The approaching electricity crisis

Charles Steele Contributor
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Last week, the U.S. Energy Information Administration reported that electricity prices in July 2010 were 3 percent higher than the previous month and 1.5 percent higher than the previous year.

And with winter coming — a colder-than-average winter for the eastern third of the country, according to the Farmer’s Almanac — Americans will require more electricity to heat and light their homes, adding on to the devastating recession.

If the soaring electricity prices weren’t bad enough, the Environmental Protection Agency (EPA) is on the verge of imposing burdensome regulations on electricity providers, which will have a widespread effect on the cost and reliability of electricity for everyone. Since Americans — especially low-income families, minorities, and senior citizens — continue to experience economic hardship, the last thing the country needs are higher electricity costs and reduced electricity capacity just when families will need electricity the most.

On January 2, the EPA’s greenhouse gas regulations will go into effect, hitting electricity providers including traditional coal-fired plants, renewable biofuels producers, and other so-called emitters.  As the Wall Street Journal recently explained in an excellent editorial, the regulations are “mostly obscure, ranging from traditional pollutants such as mercury and sulfur to new regulation of coal ash and even water intake structures, which power plants use to cool down equipment.”  These regulations will cause an energy crisis of new proportions, as costs will skyrocket and the overall reliability of our electricity will be damaged.

The potential cost impacts are well documented. The Affordable Power Alliance released a study showing the disproportionate cost impacts of the EPA’s regulations on minority families, as these families spend disproportionately more of their income on electricity bills. The study found that by raising household electricity costs as much as 50 percent, the EPA’s regulations would cause the poverty rate for Hispanic and African-American households to increase 20-22 percent by 2030. We’d see the effects within a few years, too, because by as early as 2015, we could see minority household incomes decrease by as much as $630 per year.

With winter coming, however, I’m equally concerned about the reliability impacts — not just for minority families, but also for senior citizen households and other families that require heat and light to survive a harsh winter. The Wall Street Journal editorial cited a new study by the North American Electric Reliability Corporation (NERC), which found that the regulations will “subtract between 46 and 76 gigawatts of generating capacity from the U.S. grid by 2015,” which equals about 7.2 percent of our electricity capacity. The majority of the lost capacity will be from our reliable and affordable coal-fired plants that supply more than half of the country’s electricity. According to the NERC study, Ohio, Pennsylvania, and West Virginia will be particularly hard hit by “brownouts and shortages” due to lost electricity capacity — and these are states that will likewise be hard hit by a cold winter.

It appears that, come January, we’ll not only face continually rising electricity prices, but we’ll also be much more likely to have unreliable electricity just as the winter storms come. When you add the expected loss of jobs and household income, it appears that the EPA’s greenhouse gas regulations will cause an electricity and economic crisis of epic proportions.

I urge the EPA to take a close look at the regulations — and listen to the Affordable Power Alliance study, the NERC study, and the numerous U.S. governors, senators, representatives, and scientists who have all said that the greenhouse gas regulations on both traditional and renewable fuel sources will cause major problems with the cost and reliability of our electricity grid. The EPA must reverse their regulations before it’s too late.

Dr. Charles Steele Jr. founded Working People for Fair Energy, a non-profit organization devoted to fighting for energy laws that are fair and affordable to working people and low-income families. He has served in the Alabama state Senate, and re-elected three times before resigning to become president of the SCLC in November 2004. He has been inducted into the Martin Luther King, Jr. Board of Preachers of Morehouse College and the Tuscaloosa Civic Hall of Fame.