LANSING – Michigan will likely see some changes in its air quality rules and its energy costs as a result of President Barack Obama’s new climate action plan, but exactly what those changes will be remains unclear, various sources told Gongwer News Service.
Environmental groups hoped the plan, as it is fleshed out, would encourage more renewable energy use, while business groups raised some fears it would mean higher energy costs in the state. The two major utilities said they had already made some strides toward reducing carbon and other emissions as the president is urging.
Obama’s announcement last week did not include much detail, leaving design of the plan to the U.S. Environmental Protection Agency. But he did say much of the emphasis would be on power plants.
“Today, about 40 percent of America’s carbon pollution comes from our power plants,” he said in a speech at Georgetown University last week. “But here’s the thing: Right now, there are no federal limits to the amount of carbon pollution that those plants can pump into our air. None. Zero.”
The new program is meant, though, to be flexible in how states meet the standards, Obama said.
For Michigan, the plan will mean further moving away from coal as a primary energy source, Hugh McDiarmid with the Michigan Environmental Council said.
“Michigan has an aging fleet of power plants,” McDiarmid said. “It’s not good news for those plants. It will make it less attractive to keep limping along with those plants.”
James Clift, policy director for the MEC, said the policy would mean more energy efficiency efforts.
“That’s probably the primary way you can reduce that greenhouse gas number,” he said. “That’s a sweet spot where we can be completely consistent with what the president is asking for and provide benefits for Michigan families and businesses.”
But he said the state also needs to diversify its energy portfolio. “As coal is required to cover its actual costs, renewables become more attractive,” he said.
The president’s plan could also play into efforts by Governor Rick Snyder to increase renewable power use in the state, Clift said.
“The question that the governor’s process is asking, and we need to be asking, is what’s the next step in that transition,” he said of moving from fossil fuels to renewable.
Diversification was one highlight from the president’s plan, Jason Geer with the Michigan Chamber of Commerce said.
“One of the positives we heard from his speech was an emphasis on natural gas and continued exploration,” Geer said. “Moving toward a fuel that is cleaner and helps Michigan to be more energy independent is great.”
The chamber also welcomed the president’s commitment to work with industry, Mr. Geer said. But the group is also concerned about putting too many restrictions too quickly on coal.
“Energy costs are high right now and coal is one of the primary energy providers in the Midwest,” he said. “We can’t just turn it off; we have to transition.”
Charles Owens, state director for the National Federation of Business-Michigan, said the plan would not likely be anything new.
“This is the cap and trade stuff that we’ve dealt with,” he said. “This is going to drive up energy costs for everybody … for a questionable benefit which is global warming.”
Owens said the new federal health care law had already thrown enough uncertainty into the economy, and the climate action plan would only damage the economy further.
The state’s two major utilities withheld comment on the plan itself until there was more detail, but said they had already made substantial efforts toward reducing emissions.
Randi Berris with DTE Energy said the utility reduced emissions 4.5 percent just between 2011 and 2012, with overall emissions down 17 percent since 2000.
The emissions control equipment in place on the utility’s power plants is designed to capture other pollutants, but can also capture carbon emissions, she said.
Berris said DTE Chief Executive Officer Gerry Anderson was chair of a workgroup working with the EPA to limit greenhouse gas emissions.
The utility is also working to build a new nuclear plant as a way to reduce carbon emissions, she said.
Dan Bishop with Consumers Energy said his utility also was working to limit emissions.
“Currently, we’re investing $1.1 billion at our existing sites,” he said. “That investment is paying off. Michigan’s air is the cleanest it’s been in at least 20 years.”
Bishop said Consumers is also moving away from coal and toward natural gas to reduce emissions.
But he said any plan that would further limit emissions would increase costs.
“There little question that this would mean increased costs,” he said. “Exactly what that will be is not known at this point.”
McDiarmid said the plan in the end would stabilize rates because renewable power has been more stable than coal in recent years.
And without details on the federal plan, it would be difficult to say how Michigan’s regulations might change in response, most said.
“We’ll work closely with the regulatory bodies in Michigan to come up with a plan that works for Michigan,” Berris said. “We want to ensure reliable and affordable energy.”
A key concern for business groups is that Obama is addressing the issue on his own.
“One of our biggest concerns is it going to be set through agencies,” Greer said. “Energy policy should be set by Congress.”
U.S. Rep. John Dingell (D-Dearborn) has agreed that Congress should act on the issue.
“The very fact that the White House’s approach contemplates no role for Congress is a sad commentary on the dysfunction of our country’s legislative branch, particularly the House of Representatives,” Mr. Dingell said in a statement. “It is high time that Congress acts on its mandate and works with the President in a common sense, bipartisan manner to protect our air, land, and water.”
Obama said he would like to see federal legislation on the issue, but could not wait for Congress to act.
“In my State of the Union address, I urged Congress to come up with a bipartisan, market-based solution to climate change, like the one that Republican and Democratic senators worked on together a few years ago. And I still want to see that happen. I’m willing to work with anyone to make that happen,” he said in the address. “But this is a challenge that does not pause for partisan gridlock. It demands our attention now.”
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