Will the Trump administration attempt to kill the Environmental Protection Agency’s recently promulgated standards designed to reduce greenhouse gas emissions from power plants? Will the courts try to kill them? Will the electric industry continue its relentless effort to hold the title of the second-biggest greenhouse gas emitter in a nation that is itself the second-biggest greenhouse emitter? We suspect that the answer to those questions in the order asked is yes, yes, and, of course, yes. As consumers, shouldn’t we rejoice? After all, everyone knows how burdensome EPA regulation is, right?
The EPA usually insists that its rules are not burdensome, but, hey, what would you expect professional regulators to say? So we took note of a newly published study in Science (10 January 2025 issue), an econometric analysis written by researchers from eleven institutions (most of them respectable) with a lead author from Electric Power Research Institute, an electric industry-sponsored institution.
The study shows that implementing the EPA rules:
Would decrease greenhouse gas emissions by at least 16 percentage points more than than previous predictions through 2035 and at least 3% points below previous projections through 2040.
Would raise the real wholesale price of power over what it would have been by 7 percentage points through 2035 and 3 percentage points through 2040. That means that prices to ultimate consumers would rise by 4% and 1% respectively, more or less. That translates to less than 0.6% per annum through 2035 and 0.1% through 2040. In a long-term study like this one, that is like a rounding error.
Reduce coal’s share of the market by 2-3 percentage points in both periods below the share coal would have had.
Increase natural gas share of generation by more than 20 percentage points over what it would have been. (So what is the industry complaining about? Isn’t this what it wanted? Preservation of the gas option as long as possible?).
Decrease coal’s share of generation by roughly 5 percentage points.
Decrease carbon capture and storage (CCS) by 2 percent through 2035 and 2040 below what it would have been otherwise. Basically, that means little or no CCS. Not that anybody pushed for it except oil and coal companies.
Now, we admit that long-term econometric models should be viewed with skepticism, but so should declarations by business people that they oppose EPA regulations in order to protect customers from excessive costs. More likely they oppose regulation because they don’t like being told what to do by Washington bureaucrats or because it will cost them money or opportunities. It looks as if the new EPA rules will reduce emissions and won’t cost a lot of money, more or less. So why not move on?
Which brings up more disturbing issues. The same issue of Science offered a long article about a technique to stabilize perovskite solar cells (highly efficient but prone to degradation). All the authors worked at Chinese institutions. (In fact, we get the impression that the bulk of academic articles on energy R&D are Chinese, but we haven’t done a count.) Why are we expending so much energy to preserve the past while the Chinese are funding the future? And why does the electric industry spend so little on R&D and so much on legal battles? Just a question.
By Leonard S. Hyman and William I. Tilles for Oilprice.com
