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In an ever-changing landscape, Co-ops ask for stability in any Climate Change Legislation

 

 

NRECA CEO outlines Co-op Consumer Needs

In a letter sent to Senator Boxer, Chair of the Senate Environment and Public Works Committee, NRECA CEO Glenn English called on the Senate to deliver a climate change bill that is “more affordable, more workable, and more technologically achievable.”

Expressing concern about the disproportionate impact of the legislation on low- and fixed-income households, on specific economic sectors, and among regions, English urged the Senate to include the following:

Achievable emission caps and timelines. Targets during the first 15 years of a climate program should reflect the expected availability of technology. Legislation should also allow sufficient time for the EPA, other agencies, and covered sectors to establish regulations and prepare for the implementation of the program.

Protection of electricity consumers by allocating allowances to local distribution companies based on carbon content of fuel mix. The most efficient method of minimizing the costs of a carbon reduction program to our electric consumers is to freely allocate allowances to local distribution companies on the basis of emissions.

In the case of not-for-profit, member-owned electric cooperatives, it is impossible for “the utility” to profit from the free allocation of allowances. Our member-consumers directly bear all costs resulting from efforts to reduce emissions to cap levels and acquire allowances. Likewise, our member-consumers directly save on their electric bills when costs are avoided. A program design that requires cooperatives to purchase allowances will raise costs to our consumer-members for compliance, redirecting funds that they could have otherwise invested in low-carbon technologies. Allocating allowances based on the carbon content of the fuel mix recognizes regional differences in generation and will ensure fairness and affordable electricity for all American consumers.

Robust cost containment measures to promote economic sustainability. The best method of assuring cost certainty is the inclusion of an economic safety valve. A safety valve limits the potentially destabilizing impacts of a cap-and-trade program on energy prices and ensures affordability of electricity to our member-consumers.

Offset credits to provide flexibility. The inclusion of workable domestic and international offset credit programs will provide covered sectors flexibility in planning cost-effective investments in low-carbon technologies and reduce costs to consumers. Workable domestic and international offset programs are critical to protecting consumers, particularly in the early years of a climate program.

Establish a single, integrated program. A workable piece of legislation will ensure that regulated entities understand the “rules of the road” and know who the “traffic cop” is on that road. To make new legislation workable, it should not simply be layered upon existing law at the federal, state, or local level. Therefore, climate change legislation should establish a single, organic new law that establishes the sole legal and regulatory requirements for reducing greenhouse gas emissions.

Technology Development and Deployment Incentives. To make greenhouse gas reduction requirements achievable, we will need new, cost-effective technologies to reduce emissions. Including significant incentives for new technologies (including carbon capture and sequestration, plug-in hybrid electric vehicles, renewable and nuclear power, etc) will be critical to the sustainability of any new legislation and the achievability of the emissions reductions.

Where NRECA stands

As cost-effective technology is not currently commercially available to capture and store CO2 produced by coal-based power plants, NRECA believes that any realistic policy must include a substantial, prolonged research and development program.

The Electric Power Research Institute (EPRI) has identified seven critical areas for research and development in the electric power sector:

  • renewable energy
  • energy efficiency
  • nuclear power
  • advanced clean coal generation
  • carbon capture and sequestration
  • distributed energy
  • plug-in hybrid electric vehicles. (MORE)