Utilities warn of higher rates because of pollution rules
From an article by Tom Content published in the Milwaukee Journal Sentinel on August 19:
Two state utilities said this week new federal pollution rules will lead to higher electricity costs come January.
Wisconsin Public Service Corp. of Green Bay said its residential customers can expect an increase of more than $4 a month next year, including about $2 linked to the new rules designed to limit air pollution from coal-fired power plants.
The utility said it would see higher costs of about $32.6 million in 2012 from the Cross-State Air Pollution Rule that was finalized recently by the U.S. Environmental Protection Agency. That will result in rates going up by 6.8% instead of 3.4%, the utility said.
The U.S. Environmental Protection Agency last month finalized stronger regulations for Wisconsin and 26 other states aimed at curbing air pollution from long-distance sources.
Environmental groups praised the new rule because it would reduce acid rain and air pollution as well as help curb health effects from dirty air linked to coal plants. The EPA projected the rule will save up to 34,000 lives a year and prevent more than 400,000 asthma attacks as well as 19,000 admissions to hospitals. . .
The new rule has been in development for several years but the first phase of compliance hits utilities in 2012. WPS said it won’t have time to install pollution controls by next year at its plants, but will be able to comply by purchasing credits from other utilities that have cut emissions.
The utility also said it plans to operate its coal plants less next year than it otherwise would have, and will buy more power from the Midwest wholesale power market as a result, a move that it said is also a factor in higher costs for customers. . . .
On Thursday [August 18], Wisconsin Power & Light Co. [Alliant] of Madison said it would face an additional $9 million in costs linked to the air pollution rule. With the change, the utility is now seeking an increase in 2012 of $20 million, or 2%, utility finance manager Martin Seitz said in a filing with state regulators.
Todd Stuart, executive director of the Wisconsin Industrial Energy Group, criticized the increases, and he noted that large energy users like paper mills will see higher than average increases, compared with homeowners and small businesses. Paper mills served by WPS could see a 9% hike, he said. . . .
“Industry always cries wolf whenever EPA tries to reduce air pollution,” said Katie Nekola, lawyer with the conservation group Clean Wisconsin. “The fact is, the new rule will affect old, inefficient, unnecessary coal plants that should have been shut down long ago. The continued operation of those old units is costing ratepayers money, but you don’t hear industry complaining about that.”