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Earlier this week, the U.S. Environmental Protection Agency (EPA) unveiled its Clean Power Plan, which proposes standards to cut carbon pollution from existing power plants by 30% below 2005 levels by 2030. The rules could certainly put more pressure on some power companies and mean less coal, and as expected, reactions among utilities, renewable energy advocates, politicians, and other power industry stakeholders have been mixed.

Utility company National Grid, for example, openly supports the EPA's regulations and has commended the agency for proposing a federal-state partnership regarding compliance. According to the EPA, states will be allowed to determine the proper mix of generation using diverse fuels, energy efficiency and demand-side management to meet the goals and their own needs.

In a statement, National Grid US President Tom King calls the agency’s plan “sensible and practical.”

"The Obama Administration, through the good work of EPA Administrator Gina McCarthy and her staff, has worked in a transparent manner to craft regulation that promotes environmental and human health through a host of clean energy options,” King says. “Rather than picking winners, this proposed rule supports market-based solutions.”

National Grid notes it has long supported efforts to reduce greenhouse gas emissions from its own footprint, having established reduction goals of 45% by 2020 and 80% by 2050, from year 1990 baseline levels. In fact, the company says its total emissions in the U.S. have already dropped by 65% from 1990 to 2013.

NextEra Energy Inc., whose subsidiaries include Florida Power & Light Co. and NextEra Energy Resources LLC, also has commended the EPA for offering compliance flexibility on the state level. The company adds that it looks forward to continuing its own efforts to produce cleaner power.

"At NextEra Energy, we have positioned our business to manage the opportunities and risks presented by climate change issues, while simultaneously lowering emissions,” says NextEra Energy Inc. Chairman and CEO Jim Robo. “And for customers of Florida Power & Light Co., we have been investing billions of dollars to modernize our system, converting older, oil-fired power plants into high-efficiency energy centers that run on clean, U.S.-produced natural gas and increasing our use of emissions-free nuclear and solar energy.”

Xcel Energy, another utility company that has embraced renewables in a big way, recently reported that it has reduced its carbon dioxide emissions by nearly 20% since 2005. Furthermore, Xcel says it is already on track to achieving a projected carbon reduction of 31% by 2020.

That’s in large part due to Xcel’s increased reliance on renewable resources, which accounted for 20% of the company’s energy mix in 2013. Notably, the American Wind Energy Association recently named Xcel the top U.S. utility wind provider for the 10th consecutive year.

"Over the past decade, Xcel Energy has invested in a cost-effective clean energy strategy that is benefiting both our customers and the environment," says Ben Fowke, chairman, president and CEO of Xcel Energy, in a statement. "We are making significant progress reducing emissions at an excellent price through a combination of energy efficiency programs and coal plant retirements and conversions, and by embracing renewable energy earlier than other utilities.”

Nonetheless, some utility players have voiced their concerns about potential impacts of the EPA’s proposal. The American Public Power Association, which represents not-for-profit, community-owned electric utilities, says it believes climate change should be addressed. However, the group says that responsibility should fall on Congress, not the EPA, and the agency’s plan could lead to unnecessary and ill-planned coal plant retirements.

"Public power utilities are good environmental stewards. But we need a middle path, one that respects the needs of energy producers and the pocketbooks of energy customers," comments Sue Kelly, president and CEO of the American Public Power Association. The group also argues that the U.S. utility industry has reduced its carbon dioxide emissions by more than 12% between 2007 and 2012 - without federal rules and regulations.

Smart grid stakeholders have chimed in on the EPA’s proposal as well. The Association for Demand Response & Smart Grid (ADS) applauds the plan’s flexibility but still has some issues with the current proposal.

"We are surprised, however, to see that demand-side efficiency is described in the regulations as only being 'end-use' efficiency,” notes ADS Executive Director Dan Delurey. “States, utilities and technology companies know that traditional end-use efficiency is not the only way to reduce usage and, thus, emissions.

“With the use of demand response and smart grid technologies and practices, it is possible to manage peak load, and for efficiency to be dynamic and dispatchable on a 24/7 basis,” he continues. “It can, thus, play a greater role in optimizing our electricity system and reducing emissions. It may even be possible to consider using demand response as a dynamic emissions-reduction tool."  

Delurey says ADS looks forward to commenting on the draft regulations and making a strong case for smart grid and demand response solutions to the EPA and states.

As part of its Clean Power Plan, the EPA also seeks to shrink electricity bills roughly 8% by 2030 by increasing energy efficiency and reducing demand in the electricity system. The American Council for an Energy-Efficient Economy says it is pleased to see energy efficiency have a role in the plan.

"By including energy efficiency in its proposal, the Environmental Protection Agency has created a path for states to lower consumer energy bills through modest investments. States that take advantage of this flexibility will benefit both the economy and the environment.”

Unsurprisingly, the wind and solar industries have also welcomed the EPA rules. Because the proposal would invariably mean less coal, the sectors say renewables resources are slated for resultant growth and well positioned to help the power sector with compliance.

“The good news is that meeting this new rule is very doable,” says Tom Kiernan, CEO of the American Wind Energy Association. “Wind energy is already affordably and reliably reducing power sector emissions by more than five percent nationally - reducing carbon dioxide emissions by more than 10 percent in 11 states so far, and making some reductions in nearly every state.”

Rhone Resch, president and CEO of the Solar Energy Industries Association, adds that solar can be “a real game-changer for regulators looking to meet the changing needs of their state.” According to Resch, “The 14,800 megawatts of solar currently installed in the U.S. can generate enough pollution-free electricity to displace 18 billion pounds of coal or 1.8 billion gallons of gasoline. That’s the equivalent of removing 3.5 million cars off our roads and highways.”

In addition to power industry companies and associations, politicians have spoken out about the EPA proposal. For instance, Rep. Mike Pompeo, R-Kans., a member of the House Committee on Energy and Commerce, has blasted the plan. In a statement, he charges the regulations would represent a cap-and-trade program, though the Obama administration does not consider it one.

“The White House’s renewed efforts to push costly cap-and-trade restrictions on affordable energy will only hurt American families and their jobs,” says Pompeo. “I will continue to fight the president’s destructive none-of-the-above approach to American energy by offering bipartisan reforms that would make energy more affordable and reduce expensive regulations.”

Pompeo also argues that coal is the U.S.’ biggest source of electricity, accounting for nearly 40% of the country’s power supply, “yet this administration is systematically attempting to regulate this valuable and abundant resource out of our energy mix.” He says previous EPA actions have already led to planned closures of over 400 coal units and could ultimately kill tens of thousands of jobs.

Meanwhile, Sen. Tom Carper, D-Del., a senior member of the Senate Committee on Environment and Public Works, has lauded the EPA proposal.

“Delaware and other states feeling the impacts of climate change have already taken action to reduce local power plant carbon emissions,” Carper says in a statement. “Unfortunately, a few states cannot tackle this issue alone - all states must do their fair share to make an impact. [The] Clean Power Plan unites our country in working to take on the largest source of carbon emissions together.”

The senator later says, “Opponents to this rule will argue that we have to choose between having a cleaner, stronger environment and having a robust, growing economy. I believe this is a false choice. Not only has EPA crafted a rule that ensures the benefits far outweigh the costs - we know inaction on climate change only costs us money in the long run.”

Despite all of the industry reactions, it is still unclear how exactly the power sector could be affected by the EPA’s plan. The regulations have earned praise from some stakeholders and concern - even outrage - from others. But one thing is for sure: The EPA is now taking public comment on its proposal, which will surely lead to much more debate. 

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