NERA Economic Consulting Releases Study on Combined Impacts of EPA Utility MACT Rule and Clean Air Transport Rule

by Marlo Lewis on June 9, 2011

in Features

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File this one under regulatory trainwreck. NERA Economic Consulting has just published a study on the combined economic impacts of EPA’s Clean Air Transport (CATR) Rule and Utility Maximum Available Control Technology (MACT) Rule.

NERA estimates the rules will impose $184 billion in cumulative costs on the electricity sector, increase average U.S. electricity prices in 2016 by 12%, and reduce net U.S. employment by 1.4 million jobsduring 2013-2020.

“It is important to note that this report only covers CATR and Utility MACT,” comments Brandon Plank of the Republic Policy Committee. “It does not include the costs of EPA’s greenhouse gas regulations under the Clean Air Act, New Source Performance Standards for refineries and utilities, ozone and particulate matter standards, reclassification of coal ash, etc.” (See chart below.)

Here is the NERA study’s summary of key results:

  • Coal unit retirements would increase by about 48 GW
  • Electricity sector costs would increase by $184 billion (present value over 2011-2030 in 2010$) or $17.8 billion per year
    • Includes coal unit compliance costs (including $72 billion in overnight capital costs), fuel price impacts, and costs of replacement energy and capacity
  • Coal-fired generation in 2016 would decrease by about 13% and electricity sector coal demand in 2016 would decrease by about 10%
  • Natural gas-fired generation in 2016 would increase by about 26% and Henry Hub natural gas prices 2016 would increase by about 17%
    • Increased natural gas prices would increase natural gas expenditures by residential, commercial, and industrial sectors by $85 billion (present value over 2011-2030 in 2010$) or $8.2 billion per year
  • Average U.S. retail electricity prices in 2016 would increase by about 12%, with regional increases as much as about 24%
  • Net employment in the U.S. would be reduced by more than 1.4 million job-years over the 2013 – 2020 period, with sector losses outnumbering sector gains by more than 4 to 1.

BobRGeologist June 11, 2011 at 4:17 pm

Here we go again with the our politicians persuing the policy of weakening the only protection we have against the likelyhood of the onset of Pleistocene glaciation #6 by closing coal fired power plants. It appears that our ruling class does not realize our planet is still in a glacial mode with ice in our polar regions, or that our sun has weaker phases during which it is dependent on a robust greenhouse gas to prevent Earth from becoming iced to the equator, a condition that has existed twice in the distant geologic past. There is no record of our planet overheating, that is a Green pipe dream.

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