On Tuesday, a federal appeals court struck down the EPA’s “good neighbor rule” that would have placed additional restrictions on emissions from coal-fired power plants in certain states in the South and Midwest in order to protect downwind states in the East. Michigan was one of 28 states that would have been affected by the rule. The court ruled that the states needed more time to devise their plans before the EPA issued its standards.
This is one of the four rules that would require major retrofitting and retirement of older coal-fired power plants, many of which are concentrated in the Midwest. Industry describes the rules collectively as a “train wreck,” with multiple layers of new requirements on coal plants.
The EPA has yet to decide whether to accept the ruling or appeal it. Utility planners—trying to determine future investment strategies—are in limbo while the ongoing regulatory and legal saga continues. Studies show that compliance with the new rules could create real challenges in maintaining power supply in the Midwest due to the implementation timelines.
We know plants in Michigan will need to be shut down and retrofitted in the coming years. Approximately half of our generation capacity in Michigan is at least 40 years old and one-quarter is at least 50 years old. Some utilities such as Consumers Energy have already announced retirement decisions on the oldest, most inefficient plants.
We could continue to drag our feet and wait for final decisions on a maze of federal environmental requirements. But wouldn’t it be better if Michigan looked proactively at its existing power plant fleet and identified the best way to serve customers with reliable power, protect the environment, and keep costs and utility rates manageable? It is time to take off the Band-Aid and deal with the aging infrastructure. Michigan can and should take action without federal rules or other mandates.
Details on Tuesday’s court decision (LA Times, 8/22/2012)
Court ruling (United States Court of Appeals, 8/21/12)
By Sally Talberg