Honourable Commissioners :
The purpose of regulations such as the present one is to shape public and private activities so as to achieve some public purpose. For that reason, they must be evaluated based on two criteria, firstly the soundness of the purpose, secondly the suitability of the regulation to achieve the purpose. I intend to address only the second question.
The objective of this rule is admirably stated by the following sentences :
“This rule, as proposed, would continue progress already underway to lower the carbon intensity of power generation in the United States. … Nationwide, by 2030, this rule would achieve CO 2 emission reductions from the power sector of approximately 30 percent from CO 2 emission levels in 2005.”
In fact, however, no such result can be anticipated. The proposed method for calculating carbon intensity of electric generation fails to account in any reasonable way for hydroelectricity and nuclear fission, the two largest carbon-free sources of electricity. Together, these account for something like a quarter of the nation’s electric power, but a much larger share in some States, such as Washington.
What is the consequence of this omission? Many hydroelectric generating stations are approaching or have already reached one hundred years of age, and may require correspondingly large investments to keep them in operation. If hydro plants are closed, and replaced by fossil-fuel stations of modern efficient types, the States where this change occurs will show a reduction in carbon emissions under the proposed method of calculation, whereas in reality emissions will increase ; likewise, no credit will be given for new additions of hydro capacity. It may be supposed that this latter is irrelevant, because most possible hydro sites have already been developed, but in fact retrofitting of hydroelectric capacity to existing dams is already being undertaken. The growth potential of nuclear energy, especially when new reactor technologies and advanced fuel cycles are taken into account, suffers from no such limitation. A nuclear generating station can, in effect, be directly substituted for any fossil-fuel plant. At present, however, the opposite is occurring, as several nuclear stations have been shut down in recent years, owing to electricity-market regulations which do not adequately value baseload supply. Undervaluing this source of carbon-free electricity, by a factor of nineteen to one, will only exacerbate the trend.
An examination of the proposed rule suggests that its main purpose is to direct investment in new electric generating capacity toward solar and wind generation. The variability of these sources is, as a general rule, compensated for by fossil-fuel plants operating in an inefficient mode, so that the reduction in carbon emissions over all-fossil-fuel generation is small. This is well illustrated by Germany and Denmark, which for all their vaunted investment in solar and wind have among the highest carbon intensities of electric generation in Europe ; and we see it in microcosm at the Ivanpah concentrated-solar station, which is now burning enough fossil fuel to account for the majority of its electrical output. The two countries mentioned also have among the highest electricity prices in Europe, and Ivanpah cost far more to install than a fossil-fuel station of comparable output. There is every reason to suppose that these particular cases illustrate a general trend.
A further criticism arises in respect of “emission reduction … taking advantage of opportunities for lower-emitting generation and reduced electricity demand across the electricity system’s interconnecting network or grid.” Sources of carbon dioxide emissions which do not fall within the scope of the present rule include home space- and water-heating, and motor fuel for automobiles and railway trains. Again, a reduction of emissions within the scope of the rule could be obtained at the cost of increasing real emissions, by shutting down railway electrifications, replacing domestic electric appliances with gas- or even coal-burning equivalents, and operating “plug-in hybrid” automobiles exclusively on motor fuel. All of these measures, while opposed to the nominal intent of the present rule, are promoted by the manner in which it is framed.
To the extent that this rule will impose significant costs while not achieving the purpose to which it is addressed, it can scarcely be called anything less than a fraud upon the public. It is your duty to find some more adequate approach to the problem. A proper accounting for the most reliable and economical sources of clean energy now known, and for the role of electricity in displacing dirtier forms of energy, must be part of that.
