Policy: Environment & Energy

Missouri bracing for higher energy costs due to EPA regulations

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Beltway Confidential,Opinion,Missouri,EPA,Ashe Schow,Energy and Environment,Coal

States are starting to get the memo that the Environmental Protection Agency's new coal regulations will increase electricity prices - and they're not happy.

The Buffalo Reflex (subscription required), a local paper in Missouri, published a story saying that electricity costs could double thanks to the EPA regulations.

“Are you prepared to spend 75 to 100 percent more dollars for electricity in your home or business?” the story begins. “That may be the result of proposed regulations on coal plants by the [EPA] in order to curb carbon emissions, utility officials say.”

The EPA regulations in question would limit the carbon emissions that new coal-fired power plans could produce, requiring them to use expensive, unproven carbon capture and storage technology. The move is essentially a ban on new coal plants, as the rule would make them prohibitively expensive to build.

Eighty percent of Missouri’s energy comes from coal, and the cheap cost of the energy makes the state’s electric bills lower than much of the nation – 10.2 cents compared to the national average of 11.9 cents.

The EPA's new regulations would change that. A 2012 report from the Congressional Budget Office predicted that electricity generated by coal plants built with CCS technology would initially “be about 75 percent more costly” than electricity produced traditionally. And as the technology develops, the generation costs would be about 35 percent more expensive.

But again, that's if the coal plants could even be built. Earlier this month, the deputy assistant secretary for clean coal at the Department of Energy admitted to Congress that the price of electricity would increase by 80 percent if the regulations are put in place.

Other states need to take a look at what these regulations mean for their residents.

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