Obama’s War on Coal has already taken a remarkable toll on coal-fired power plants in America.
Last week the U.S. Energy Information Administration reported a shocking drop in power sector coal consumption in the first quarter of 2012. Coal-fired power plants are now generating just 36 percent of U.S. electricity, versus 44.6 percent just one year ago.
It’s the result of an unprecedented regulatory assault on coal that will leave us all much poorer.
Last week PJM Interconnection, the company that operates the electric grid for 13 states (Delaware, Illinois, Indiana, Kentucky, Maryland, Michigan, New Jersey, North Carolina, Ohio, Pennsylvania, Tennessee, Virginia, West Virginia and the District of Columbia) held its 2015 capacity auction. These are the first real, market prices that take Obama’s most recent anti-coal regulations into account, and they prove that he is keeping his 2008 campaign promise to make electricity prices “necessarily skyrocket.”
The market-clearing price for new 2015 capacity – almost all natural gas – was $136 per megawatt. That’s eight times higher than the price for 2012, which was just $16 per megawatt. In the mid-Atlantic area covering New Jersey, Delaware, Pennsylvania, and DC the new price is $167 per megawatt. For the northern Ohio territory served by FirstEnergy, the price is a shocking $357 per megawatt.
Why the massive price increases? Andy Ott from PJM stated the obvious: “Capacity prices were higher than last year’s because of retirements of existing coal-fired generation resulting largely from environmental regulations which go into effect in 2015.” Northern Ohio is suffering from more forced coal-plant retirements than the rest of the region, hence the even higher price.
These are not computer models or projections or estimates. These are the actual prices that electric distributors have agreed to pay for new capacity. The costs will be passed on to consumers at the retail level.
House Energy and Power Subcommittee Chairman Ed Whitfield (R-Ky.) aptly explained: “The PJM auction forecasts a dim future where Americans will be paying more to keep the lights on. We are seeing more and more coal plants fall victim to EPA’s destructive regulatory agenda, and as a result, we are seeing more job losses and higher electricity prices.”
The only thing that can stop this massive price hike now is an all-out effort to end Obama’s War on Coal and repeal this destructive regulatory agenda.
The Senate will have a critical opportunity to do just that when it votes on stopping Obama’s most expensive anti-coal regulation sometime in the next couple of weeks. The vote is on the Inhofe Resolution, S.J. Res 37, to overturn the so-called Utility MACT rule, which the EPA itself acknowledges is its most expensive rule ever.
This vote is protected from filibuster, and it will take just 51 votes to send a clear message to Obama that his War on Coal must end.
Of course, Obama could veto the resolution and keep the rule intact, although that would force him to take full political responsibility for the massive impending jump in electricity prices.