WASHINGTON – Today, the Institute for Energy Research will send letters to public utility commissions in all 50 states urging them to protect American families from the imprudent costs of the EPA’s so-called “Clean Power Plan.” The letter highlights the findings of IER’s new report on electricity costs. Using data from EIA and FERC, the report finds that existing sources of electricity generation are more affordable than new sources. Electricity from even the least expensive new sources is nearly double the cost of that from existing coal power.

Public utility commissions, which have a responsibility to keep electricity rates affordable, should protect the American people from unnecessary electricity hikes by rejecting policies like the Clean Power Plan.

Below is an excerpt from the letter:

Recently, we witnessed a historic ruling by the Supreme Court in Michigan v. EPA. The court ruled that EPA illegally failed to consider the costs of the Mercury and Air Toxics Standard (MATS), which at $9.6 billion per year is one of the costliest regulations in U.S. history. The decision underscores the basic truth that the costs of regulations are critical to the rulemaking process. Unfortunately, it comes too late: utilities did not wait for the Court to weigh in and have implemented most the changes under MATS, shuttering a significant amount of coal-fired generating capacity. As AEP CEO Nick Akins said after the decision, “We’re not bringing them back. Once that ball gets rolling, it’s not going to change.”

However, states have an opportunity to learn from the MATS experience. The EPA will soon finalize its so-called “Clean Power Plan” requiring states to reduce carbon dioxide emissions—the rule is expected to be even more costly than MATS. The Clean Power Plan effectively seeks to shut down functional existing sources and replace them with new (and sometimes unreliable) sources. This warrants an honest assessment of the cost of tearing down existing sources and building new sources. State public utility commissions should stand up and protect American families from the out-of-control and imprudent costs of this regulation, before it’s too late.

Last week, the Institute for Energy Research (IER) released a report, The Levelized Cost of Electricity from Existing Generation Resources, which provides just what the Supreme Court ordered—a fresh look at the high cost of shutting down power plants. Using data from EIA and FERC, the report goes beyond standard estimates of electricity costs, which focus on new generation sources, and introduces a new measure of the cost of electricity from existing sources.

Click here to read the full letter.


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