September 12, 2018 Read More →

EPA coal plan not likely to change utility plans—S&P

S&P Global Market Intelligence ($):

After years of shying away from building new coal-fired generation, U.S. electric utilities remain cautious about investing in their existing coal fleets, despite the Trump administration’s proposal to roll back Obama-era restrictions on carbon dioxide emissions.

Responses from about 20 electric utilities had several common themes: they already completed many improvements, remain cautious about the timing of the rule and are committed to shifting to cleaner generation.

The ACE rule is the Trump administration’s replacement for the Clean Power Plan, a proposal introduced by the Obama administration to address climate change. Instead of directly placing limits on total power sector emissions, ACE instead encourages states to require efficiency improvements tailored to individual sources at existing coal-fired power plants to lower the emissions per unit of power generated.

However, several coal plant owners have said the rule does not change plans to retire existing units or encourage them to build new ones. Comments received from utilities suggest the new rule may also not do much to promote investment in the existing fleet.

“We will continue to focus on retiring older, less-efficient, coal-fueled units; building advanced-technology natural gas units; and investing in cost-effective, zero-carbon renewable generation,” WEC Energy Group Inc. spokeswoman Amy Jahns said. WEC serves four states in the Upper Midwest.

Even utilities with coal-heavy generation portfolios are shying away from new investment in the fuel. AEP “has no plans to invest in new coal-fueled generation,” company spokeswoman Melissa McHenry said. Duke Energy said it currently has no plans to invest in new coal plants either.

Many power generators are simply reacting to customer demand to shift from coal generation to cleaner fuels. For example, CPS Energy, Xcel Energy Inc., Southern and Ameren Corp. subsidiary Ameren Missouri, known legally as Union Electric Co., all responded to S&P Global Market Intelligence’s inquiry by highlighting a push to renewable or otherwise low- to no-carbon energy sources regardless of the ACE proposal.

More ($): Trump power plan unlikely to make case for coal, utilities say

 

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