Obama Climate Plan Seen Making Coal Plants Less Efficient

The Obama administration’s plan to cut carbon emissions may force many coal plants to run only when energy demand peaks, making them less cost-effective, the group that oversees the U.S. electric system said.

The North American Electric Reliability Corp., a nonprofit that assures adequate voltage and power reserves, in an assessment Tuesday asked the Environmental Protection Agency to delay the 2020 deadline to start implementing the Clean Power Plan, saying pipelines, transmission lines and plants are needed to prevent the cuts from disrupting electric service.

“The generation mix in the North American power market is going through a fundamental change,” Thomas Burgess, vice president of the group, said on a conference call. “The Clean Power Plan is expected to accelerate some of those changes.”

President Barack Obama’s plan to combat global warming is built around the EPA’s carbon proposal, which would require a 30 percent cut in emissions by 2030. The plan is designed to replace coal as the main source to generate electricity with increased use of natural gas, renewable power and efficiency measures.

The emissions plan will have wide-ranging effects on utilities, forcing changes that will upend models used for a century for generation and distribution of electricity. The EPA has said 40 years of clean-air actions have never caused power outages, and other analysts have said cheap alternatives such as natural gas and renewable energy will mean the decline in coal won’t cause major disruptions.

State ‘Flexibility’

The EPA said the power-plant proposal is designed to protect domestic power supplies.

“The agency’s plan will provide states and utilities the time and flexibility needed to continue their current and ongoing planning and investing to modernize and upgrade the power system,” the EPA said in a statement. “We have a long- standing commitment to safeguard not only public health and the environment but also a reliable and affordable supply of electricity for all Americans.”

To meet the outlines of the EPA’s proposed plan, the industry would need to build natural-gas power plants producing an additional 46 gigawatts by 2020, said John Moura, the group’s reliability director. Those would replace shuttering coal plants.