Taking Action to Reduce Carbon Pollution

An overview of the EPA Clean Power Plan and Montana’s implementation pathways

For a printable version of this factsheet, click here

 The Clean Power Plan and its Four Building Blocks

In June 2014, the U.S. Environmental Protection Agency (EPA) proposed its “Clean Power Plan” – the first-ever limits on carbon pollution for the nation’s existing electricity generating plants.

Coal and natural gas-fired power plants are the largest sources of human-caused carbon pollution today, emitting about one-third of U.S. greenhouse gases. Because of this, President Obama directed EPA to reduce carbon pollution from those facilities. EPA’s proposed plan calls for a nationwide reduction of 730 million metric tons of carbon pollution by 2030 – a 30% reduction from America’s 2005 carbon pollution levels.

EPA held many public meetings and stakeholder roundtables and was asked to design a rule that is flexible, state-specific, and gives states the authority to design their own carbon reduction programs. Each state can decide how it will meet its target. States could meet their goal by relying entirely on energy efficiency programs, or renewable energy development, or whatever combination the state decides is best.

 Montana’s Clean Power Plan Goal

Montana’s carbon reduction goal is a 21% reduction from 2005 carbon pollution levels by 2030. This is the second weakest carbon reduction goal in the nation.

Montana can easily meet this carbon pollution reduction goal and strengthen our economy. Montana has the second-best wind resource potential in the country, and great untapped solar energy potential. We also have the opportunity for vast energy efficiency gains – improved efficiency is by far the most affordable electricity resource available.

 Governor Bullock and DEQ’s “Options for Montana’s Energy Future”

Gov. Bullock asked the Montana Department of Environmental Quality (DEQ) to analyze potential ways to comply with the EPA’s proposed Clean Power Plan. The DEQ released an initial white paper in September 2014 to explore different alternatives to reach Montana’s carbon-reduction goal.We appreciate the Governor and DEQ taking leadership on this issue.

Read the Governor’s open letter to Montanans >>

Read the DEQ report “Options for Montana’s Energy Future” >>

The DEQ’s white paper, Options for Montana’s Energy Future, lays out five pathways that Montana could take to comply with the Clean Power Plan. The potential scenarios show that we can reduce Montana’s carbon pollution while improving our economy.

Those five scenarios include:

  • Scenario 1: Existing Energy Generation plus Heavy Energy Efficiency
    • Also includes increase in Renewable Energy
  • Scenario 2: Existing Energy Generation plus  Lewis and Clark Co-fired Power Plant
    • Also includes increase in Renewable Energy
  • Scenario 3: Existing Energy Generation plus Moderate Energy Efficiency and Heat Rate Improvement at Existing Power Plants
  • Scenario 4: Existing Energy Generation plus Heavy Renewable Energy
    • Also includes energy efficiency
  • Scenario 5: Existing Energy Generation plus Carbon Sequestration at Colstrip
    • Also includes energy efficiency

Significantly, none of the options include closure of Montana’s eight existing coal-fired power plants, though the white paper does assume the impending closure of the Corette power plant in Billings.

 How can DEQ’s pathways to carbon reduction in Montana be supported and improved?

  • Pursue energy efficiency first and foremost. Not only is energy efficiency the best way to reduce carbon, with no downsides, it also results in significant job creation for Montanans. Montana can make great gains in this area, reducing energy bills with each renovation.
  • Include small-scale renewables like rooftop solar in the mix. Small-scale  generation of renewable energy, distributed across the state, provides the greatest benefits to the most people:
    • Citizens have the freedom to choose their energy source and lock in their future cost of power,
    • Transmission line loss is minimized, and
    • Fewer new transmission lines are required.
  •  Heat rate improvements make sense. Power plants can put people to work making modest but important efficiency gains on-site.
  • Stay away from a solution that relies on Carbon Sequestration. Carbon sequestration is not a reliable technology or a viable option for carbon reduction. It is still unclear whether carbon sequestration works at all, or how it might affect landowners and aquifers. Montana cannot afford to bet the future of its economy and its citizens’ quality of life on an unproven and costly experiment. The DEQ plan admits that it is cost-prohibitive at this time and would likely raise electricity rates.

Concluding Recommendations

Northern Plains Resource Council commends the DEQ for taking this very important step to get people thinking about how to reduce carbon pollution. The vast majority of what is outlined in Options for Montana’s Energy Future is visionary, yet practical, would reduce carbon pollution and electricity rates, and would create jobs.

Northern Plains recommends one scenario above the others, and has a suggestion to make it even better:

Scenario 1 focuses on energy efficiency, which has no downsides. The lowest-cost energy is the energy you don’t have to use. Scenario 1 also includes a modest increase in renewables, which we believe can be done via distributed generation and not necessitate new large transmission lines which would create property rights problems. Both increased energy efficiency and renewable energy will create new job opportunities in Montana.

Improvement: Why not also make heat rate improvement at existing power plants in Scenario 1? This is an efficiency gain that will also create jobs—something everyone can support.

All scenarios would most likely represent more up-sides than downsides, with the exception of Scenario 5, which is risky, expensive, and a threat to landowners and aquifers. It is unlikely that the projected carbon reductions from carbon sequestration can actually be achieved.

 

Great Policy Ideas for all Montanans

Energy efficiency demand side management. Use technology that allows consumers to make informed energy use decisions based on the true cost of power at that time and on overall energy demand across the entire system. By incentivizing consumers to use less energy when there is the greatest system wide demand, peak load for utilities is reduced.

An energy efficiency standard. As of April 2014, twenty-five states have policies in place that establish specific energy savings targets that utilities or non-utility program administrators must meet through customer energy efficiency programs.

Rural Electric Co-ops are not currently regulated and therefore aren’t team players in our state’s effort to reduce carbon pollution. Co-ops should be brought into the plan for carbon reductions.

Community Solar, or Neighborhood Net Metering, would allow renters, multi-family units, and homeowners with shaded rooftops to purchase part of a large solar array located off their property. Businesses or schools could also lease out their rooftops for these large solar arrays as a source of income.

Eliminate the net metering cap (currently set at 50 kW) in order to allow larger businesses and other entities like farms, hospitals, schools, and universities to offset their entire energy load with on-site renewable energy. Instead of an arbitrary limit, everyone should have the freedom to net meter a renewable energy system that produces up to 115% of their average annual energy load.

Allow aggregate net metering. Currently, a net metered renewable energy installation can only offset one meter. This is needlessly prohibitive for people with more than one meter on their property, such as farmers who have separate meters for their house, barn, water pump, and irrigation system. Aggregate net metering would allow one renewable energy installation to offset multiple meters on one’s own property.

 

 

Costs and Benefits of the DEQ’s Five Scenarios[1]

Scenario Description Lbs of Avoided CO2 Emissions Annually by 2030 Potential Energy Efficiency Savings on Montana Utiltiy Bills (2017-2030) Potential Cost of Energy Efficiency Programs (2017-2030) Net Benefit of Energy Efficiency Programs (2017-2030) Net Jobs per Year from Energy Efficiency Development Net Jobs Due to Spending from Lower Energy Bills Temporary Construction Jobs Due to New Renewable Energy Development Permanent Jobs Due to New Renewable Energy Development
1 Heavy Energy Efficiency 7.0 Billion $1.71 Billion $0.85 Billion $0.85 Billion 130 530 685 34
2 L&C Co-Fire 7.5 Billion $0.57 Billion $0.28 Billion $0.29 Billion 7 -40 1505 75
3 Moderate EE & Heat Reduction 6.8 Billion $0.85 Billion $0.43 Billion $0.43 Billion 38 105 945 47
4 Heavy RE 8.8 Billion $1.14 Billion $0.57 Billion $0.57 Billion 68 245 1645 82
5 Carbon Sequester 13.4 Billion $1.14 Billion $0.57 Billion $0.57 Billion 68 245 600 30
EPA Goal 6.8 Billion $1.14 Billion $0.57 Billion $0.57 Billion 68 245 600 30

 

[1] Options for Montana’s Energy Future. Department of Environmental Quality. September 2014. Pg 8.

NORTHERN PLAINS RESOURCE COUNCIL
220 South 27th Street, Suite A
Billings, Montana 59101
(406) 248-1154
info@northernplains.org