Legal & Regulatory

Wheeler: Keeping U.S. Coal Sector Alive Will Benefit ‘International Environmental Protection’

Coal power, which has seen a marked decline in the U.S., is necessary for reliability and energy affordability, and sustaining it could boost pollution technology exports and “improve lives while driving down emissions worldwide,” said Environmental Protection Agency (EPA) Administrator Andrew Wheeler in a speech last week.

Wheeler made the remarks at a 90-minute event that the EPA held on June 19 to rationalize why the final Affordable Clean Energy (ACE) rule is a better option than the Obama administration’s landmark Clean Power Plan. The event, which was streamed live, also featured a long list of speakers from the coal industry and pro-coal states, with coal miners and other stakeholders in the audience.

Like the Clean Power Plan,the ACE rule will regulate greenhouse gases (GHGs), and it will be founded firmly on the agency’s 2009 Endangerment Finding. However, the ACE rule focuses on the nation’s 600 coal-fired units and gives states leeway on deciding how they will meet “emission guidelines” stipulated in the rule.

At his nomination hearing in January, Wheeler told senators he was a former coal lobbyist who had previously represented more than 20 different clients, from companies to trade associations to non-governmental organizations. At the hearing, he also said that the world is having a “climate issue,” not a “climate crisis.” Last week, Wheeler did not address President Trump’s withdrawal from the Paris Agreement, an international accord adopted in 2015 to address climate change, and in which U.S. engagement has waxed and waned depending on the administration.

However, Wheeler noted that from 2005 to 2017, total energy-related COemissions fell by 14%. “We owe much of this progress to the genius of the private sector and free markets—not the heavy hand of government,” he said. When the ACE rule is “fully implemented,” the EPA expects that power sector carbon emissions could fall to as much as 35% below 2005 levels. The ACE rule will also reduce emissions of SO2, NOX, and particulate matter, he said.

“And here’s the bottom line: ACE will continue our nation’s environmental progress, and it will do so legally and with proper respect for the states,” he added.

Wheeler also criticized climate measures that several Democratic lawmakers and presidential candidates have issued recently, proposals that point to the issue’s importance in the forthcoming election. He said the “contrast” between the ACE rule and the Green New Deal and other climate change proposals by Democrats was stark. “Rather than Washington telling Americans what kind of energy they can use, or how they can travel, or even what they can eat, we’re working cooperatively with the states to provide an affordable, dependable, and diverse supply of energy that continues to get more cleaner and more efficient,” he said.

The EPA’s Expanding Role in Crafting U.S. Energy Policy

But the EPA’s new rule, and repeal of the Clean Power Plan, may also serve a specific function in U.S. energy policy, Wheeler suggested.

“The importance of reliable and affordable energy cannot be understated,” Wheeler said, pointing to a recent blackout that affected tens of millions of people in South America. “Take this away and our nation’s health and safety are at risk,” he said. Echoing other Trump administration officials—and in particular, the Department of Energy (DOE)—Wheeler said: “The reality is that there are certain types of energy sources that are conducive to rapid recovery and grid stability—and there are others that are not.”

The DOE’s controversial “Grid Resiliency Pricing Rule” proposed on Sept. 29, 2017, sought “just and reasonable rates” for power plants that showed “reliability and resiliency attributes.” It was thwarted by the Federal Energy Regulatory Commission (FERC) in January 2018. Energy Secretary Rick Perry earlier this month told the Edison Electric Institute’s annual convention in Philadelphia that FERC is still the final authority that will determine whether market incentives for any energy resource are warranted, and that the DOE does not have the “regulatory or statutory ability” to establish economic incentives for struggling U.S. coal plants.

But last week, Wheeler, who heads the federal agency whose mission is to protect human health and the environment, suggested that reliability must be a key consideration for rulemaking. Citing research from the Energy Future Initiatives, a think tank led by former U.S. Energy Secretary Ernest Moniz, he said California went more than 90 days with “little to no wind generation” in 2017. “There are also days when wind and solar combined could not meet peak demand.” On top of this, California’s appetite for renewables has caused the state’s electric prices to jump roughly 25% since 2013, he said, adding: “It’s no secret that Americans want reliable energy that they can afford. That’s what we’re helping to deliver today.”

An International Obligation to Keep Coal Alive

Finally, the U.S. must foster a thriving coal industry to expand technology development in pollution controls, Wheeler argued. “We can’t deny the fact that fossil fuels will continue to be a source of energy both at home and abroad. Coal use is rising worldwide in large parts by India, China, and other Asian nations,” he noted.

However, that argument is based on an oft-repeated claim that U.S. coal technology is more advanced than in other countries. “We mine and use coal in the U.S. in a cleaner fashion than our international competitors,” Wheeler said, pointing to recent drastic reductions in emissions of SO2, NOX, and particulates. “The U.S. has some of the lowest fine particulate matter levels in the world—more than five times below the global average, seven times below Chinese levels, and well below France, Germany, Mexico, and Russia,” he said.

“Rather than punishing U.S. production, and yielding the marketplace to Chinese coal, which is what the Obama Clean Power Plan did, we are leveling the playing field and encouraging innovation and technology across the sector,” he claimed. “We set the gold standard for cleaner technology here in the U.S,” he continued. “If we don’t develop the next generation of clean coal technologies here in the U.S., no one else will.”

As POWER reported earlier in June, the U.S. lags behind China in coal technology advancements. At the recent International Conference on Clean Coal Technologies, officials from China outlined a long list of recent breakthroughs in the realm of efficiency improvements, including double reheat systems. The country has also made vast improvements to circulating fluidized bed and integrated gasification combined cycle technologies, as well as in pollution controls. (For more, see: “How China Is Improving Coal Technology.”) India is also making notable strides in efficiency improvements, as well as in pollution-control technologies that are suited to Indian coal, which has unique characteristics. (For more, see: “India’s Coal Future Hinges on Advanced Ultrasupercritical Breakthroughs.”)

In the U.S. coal power research and development, spearheaded by the DOE, will focus on three key areas: advanced energy systems; crosscutting research; and carbon capture utilization and storage. The U.S.’s existing fleet also lags behind the world in efficiency: 72% of the U.S. coal fleet is subcritical, which means their efficiencies reach only up to 38%; 27% of the fleet is supercritical; and the nation has only one ultrasupercritical plant.

The ACE rule defines the “best system of emission reduction” (BSER) for GHG emissions from existing power plants as on-site, heat-rate efficiency improvements. In the Clean Power Plan, by comparison, the EPA determined that BSER should be comprised of three building blocks: increasing operational efficiency of coal plants; shifting power generation from coal to natural gas; and increasing power generation from renewables.

But, as analysts noted this week, the ACE rule won’t change long-term pressure on power generators to reduce CO2. As Fitch Ratings told POWER on June 25, the new rule “may result in a slower decline in coal-fired generation; however, it will not change the dynamics that have driven dramatic increases in both natural gas-fired and renewable generation. Competition from natural gas, state level renewable mandates, and increasing interest in renewables from consumers, local governments, and investors are expected to drive public power issuers toward emission reduction strategies.”

Still, according to Wheeler, “It’s important to remember that our technologies are exported to developing countries and others,” he said. “The Obama administration basically froze all future clean coal technologies to the detriment of millions in China and India.”

A key goal for the U.S. is to “export our cleaner energy and technology so that we can improve lives while driving down emissions worldwide—the path to true international environmental protection,” Wheeler said.

“We can improve lives right now by exporting our technology in pollution control technology worldwide. It is precisely what President Trump and his administration are focused on.”

Sonal Patel is a POWER associate editor (@sonalcpatel, @POWERmagazine)


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