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Coal country still deaf to federal assistance talk; Kansas to halt CPP compliance

Q2: U.S. Solar and Wind Power by the Numbers

Essential Energy Insights - September 17, 2020

Essential Energy Insights September 2020

Rate case activity slips, COVID-19 proceedings remain at the forefront in August


Coal country still deaf to federal assistance talk; Kansas to halt CPP compliance

Further calls for investment and retraining efforts incoal communities most impacted by the sector downturn continue to fall flat withindustry advocates, with critics calling the efforts the equivalent of endorsingfederal regulations often cited as detrimental to U.S. coal.

Last week, U.S. EPA Administrator Gina McCarthy said thatthe federal government should do more to assist those coal communities most impactedby the downturn in coal demand and pricing over the last several years.

"Anyone interested in why Americans are frustratedand furious at Washington bureaucrats need only examine her farcical statement,"said National Mine Association spokesman Luke Popovich. "She cynically bewailsthe plight of coal communities while her agency has largely been responsible fortheir devastation. The administration boasts at the climate conference in Parishow it's effectively shut down the coal industry, then returns to the U.S. and blamesthe destruction all on natural gas. Maybe these communities wouldn't need taxpayeraid to put families and businesses back on their feet if her agency hadn't triedso hard to destroy them."

Kansas has halted all state activities to comply with federalcarbon emissions regulations on power plants. Republican Gov. Sam Brownback on May6 signed into law S.B. 318,which terminates state action on the U.S. EPA's Clean Power Plan until a stay issuedby the U.S. Supreme Court is lifted.

The Kansas House voted98-22 on March 17 in favor of the bill. It passed the state Senate 37-2 on Feb.11. All state agency activities, studies and investigations related to the planwill be postponed, but state agencies will still be permitted to communicate witheach other "in furtherance of any of the agency's statutory obligations."

The bill also defunds the Kansas Electric TransmissionAuthority, or KETA, by repealing the statutes under the Kansas Electric TransmissionAuthority Act. KETA was created to advance the state's electric transmission infrastructureand reliability and facilitate the delivery and use of Kansas energy.

Declaring that the war against the Mercury and Air ToxicsStandards is over, several generators joined the U.S. EPA, supportive states andenvironmental groups to defend against an attempt to drag the rule back before theU.S. Supreme Court.

The MATS rule has already been reviewed by the SupremeCourt, which found inJune 2015 that the EPA did not properly consider whether the regulation was "appropriateand necessary" when considering the cost of compliance. The EPA was directedto conduct a new analysis, which was completedin April. The agency found that regulating mercury and other pollutants from powerplants was indeed appropriate and necessary when cost is factored in.

But now, the rule's opponents want another crack at therule. The state of Michigan has led the charge,asking the high court to determine whether a rule can remain in place when an agencyhas not acquired the authority to regulate in the first place. The U.S. Court ofAppeals for the District of Columbia Circuit declined to stay the MATS rule whilethe EPA conducted the necessary analysis. The Supreme Court, too, passed on a requestto do the same. The petitioners argue that the D.C. Circuit should have stayed therule in the interim, and review is necessary to prevent the same situation fromhappening in the future.

The U.S. Army Corps of Engineers announced that it hashalted the permitting process for the contested Gateway Pacific Terminal coal projectin Washington in response to a challenge from the Lummi Nation regarding tribalrights. The Lummi argued that the terminal would affect fishing rights in watersprotected under tribal agreements.

"After careful consideration of all the informationavailable to him, Seattle District Commander Col. John Buck has determined the potentialimpacts to the Lummi Nation's usual and accustomed (U&A) fishing rights fromthe proposed Gateway Pacific Terminal are greater than de minimis," the Corpswrote in a statement May 9.

Earlier this year, project backer SSA Marine announcedthat it had suspended an environmental review of the terminal until the Corps couldreach a final decision on the Lummi Nation's appeal to deny a project permit amidconcerns on the tribal group's fishing practices.

The postponement was announced April 1 by the company,which owns 51% of the project. Construction of the project was estimated to cost$700 million.

EPA Administrator Gina McCarthy poked fun at her trademarkBoston accent and addressed the struggle her agency faces when trying to regulateanything, be it carbon emissions from power plants or methane emissions from theoil and gas sector, during an interview with science educator Bill Nye.

The pair chatted at the Climate Action 2016 conferencein Washington, D.C., on May 6, where climate change activists from around the worldmet to discuss the recent successful global agreementto limit temperature rise associated with climate change.

The administrator hit back at critics of the EPA's CleanPower Plan and those who she believes have mischaracterizedthe U.S. Supreme Court's February stayof the rule.

"For crying out loud, what we have is a pause in theClean Power Plan. If anybody knows anything about EPA and writing rules, we rockat it. Legally, we do them on the basis of sound science and while there is a pause,there's no pause on the action in the United States," McCarthy said. "Weare going in exactly the direction the rule demanded, and we're doing it becausethe markets are demanding it. We could not be in better shape than we are today."

Seven in 10 U.S. voters say reducing greenhouse gas emissionsfrom energy production is a high priority, but less than half of Republicans sharethat view, according to a new poll.

The Program for Public Consultation at the University ofMaryland's School of Public Policy conducted the survey, which was released May4 by nonpartisan policy group Voice of the People. Nearly 4,400 registered adultvoters participated in the online poll, held April 16-26.

Some 70% of respondents, including 91% of Democrats, saidcutting greenhouse gases from the energy sector was a high priority. Only 44% ofRepublicans held that view, with 39% of GOP participants saying that reducing greenhousegases was a low priority and 17% saying it should not be a priority at all.

Duke EnergyProgress LLC wants North Carolina regulators to set a $50 million bondfor groups looking to appeal approval of the company's Asheville combined cycle gas plant in BuncombeCounty, N.C. The North Carolina Utilities Commission on March 28 its certificate of publicconvenience and necessity, or CPCN, for the 560-MW project. Regulators Feb. 29 as partof an expedited processdesigned to meet the region's energy needs and ramp up the retirement of the utility's379-MW Asheville coalplant. (Docket No. E-2, Sub 1089)

The North Carolina Waste Awareness and Reduction Network,or NC WARN, and The Climate Times have asked for an extension of time to file anotice of appeal and exceptions to the commission's order. However, appeals of aCPCN order are subject to a statutory bond requirement. The potential appellantscontend that this bond should be set at $250 based on their argument that DEP andits customers would not suffer any damages if the appeal were unsuccessful, accordingto regulatory filings.

"By making the absurd argument that a $250.00 appealbond would provide adequate protection for DEP's customers from potential constructioncosts delays for a $1 billion generation construction project, potential appellantsare essentially attempting to argue that the law does not, or should not, somehowapply to them," Duke Energy Progress wrote in a May 2 response to the motion.