The EPA recently announced a proposed rule to reduce carbon emissions from existing power plants to 30 percent below 2005 levels by 2030. We interviewed Tom Vinson, vice president of Federal Regulatory Affairs for the American Wind Energy Association, to learn how wind energy can help states respond the EPA proposal to cut power plant emissions.
TriplePundit: Is wind energy uniquely suited to help utilities comply with the new proposed EPA regulation?
Tom Vinson: The deployment of wind energy has grown significantly over the last decade, and a variety of energy sources have been displaced as a result of that, including coal. This is evidence that we can grow the deployment of wind energy and maintain a reliable, affordable electric system for consumers.
There are 11 different states that have achieved emission reductions of 10 percent or more because of wind and another three states that are just below 10 percent. Twenty percent wind in the eastern U.S. would yield emission reductions of 25 percent. Wind energy can be a significant player in the draft requirements that the EPA just issued.
3p: Many interest groups are creating ads for or against the proposed rules. What message would you like to send to the American people?
TV: One of our messages is that there is no need to panic. There are effective emission reduction options that are available now. We think the EPA rules are achievable with wind energy and other options.
3p: Does wind have the ability to displace the baseload power that is currently generated by coal?
TV: All power plants on the system back up all other power plants. Displacing coal provides wind an opportunity to meet that demand, that would otherwise go unmet. Natural gas and other plants on the system will help balance things out when the wind isn’t blowing.
3p: Do you think the EPA proposal could help mitigate the impact of the removal of the Production Tax Credit and Investment Tax Credit that were not renewed in 2014?
TV: We’re confident that the PTC and ITC will be renewed and fully expect that it will help. The EPA rule will have an impact in the mid and long term, but certainly [isn't] a replacement for them in the short-term.
3p: Natural gas has been competing with wind energy. How could the proposed rules impact this competition?
TV: We already compete with natural gas in many regions. What the rule does is that various zero and low-carbon generation resources will have to compete to serve the market, including efficiency, natural gas, nuclear and renewables. The EPA doesn’t take a position on which of those options should be used by states, so it’s up to each individual state which they should use. Wind energy is reducing emissions in almost every state today, and to a significant degree in many states.
3p: Who will be some of the big players in reaching these proposed emission reduction rules?
TV: The EPA sets up the overall framework and all the compliance options, which are primarily efficiency, natural gas, renewables and nuclear. [Companies] will all now work at the state level on the state plans and compete for the market that results from the requirements.
We do believe that wind energy is an affordable, reliable and widely available compliance option that will be attractive to states. Given the 43 percent cost reduction [in the average power purchase price of wind energy] over the last four years with more to come, the speed with which wind energy projects can be deployed and scaled up, and the value that wind energy provides by locking in a price for 20 or more years, which isn’t available by the fossil technologies.
3p: Does wind energy have advantages over efficiency in complying with the proposed EPA rules?
TV: One of the advantages of wind is the utility-scale aspect of it, that you can get in one shot by building a 100-, 200- or even 300-megawatt wind farm. We’ve seen wind capacity grow from doing a couple thousand megawatts [of new installed capacity] a year to 13,000 megawatts a year, with the DOE calculating that we can do even more.
3p: Do you think both a health economy and a healthy climate are possible, or do you think the two are mutually exclusive?
TV: They are both possible. A healthy climate goes hand in hand with a healthy economy. Look at states like Iowa, that have deployed a lot of wind power and had relatively robust economies. The wind energy industry supports 50,000 jobs today across the country, roughly 550 manufacturing facilities in more than 40 states, and utility-scale wind turbines installed in 39 states and Puerto Rico — which pay rent to land owners and taxes to local communities and states. There are definite upsides to the deployment of wind energy, and if you look at the EPA analysis, they project the net economic, health and climate benefit is very large.
3p: How quickly do you expect these EPA proposed rules will impact the wind energy market?
TV: The EPA is saying they will finalize the rule in June of 2015, and they want state plans submitted by June of 2016. They are offering extensions in certain circumstances to June of 2017, if a state needs it. They are offering extensions to June of 2018 if they are working on plans that encompass multiple states in the same plan. The EPA gives itself one year to review plans after they are submitted. State plans could be approved as soon as 2017 and as late as 2019. Utilities and others will see the writing on the wall and start making decisions between 2017 and 2019.
Sarah Lozanova is a regular contributor to environmental and energy publications and websites, including Mother Earth Living, Green Building & Design, Triple Pundit, Urban Farm, and Solar Today. Her experience includes work with small-scale solar energy installations and utility-scale wind farms. She earned an MBA in sustainable management from the Presidio Graduate School and she resides in Belfast Ecovillage in Midcoast Maine with her husband and two children.