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those actions taken prior to 2012 do not count towards compliance efforts under the Clean Power Plan and, in fact, only serve to reduce the final emis- sions target for the state. In April 2015, Gov. Mary Fallin issued an executive order forbidding the development of a state plan. Michael Teague, secretary of energy and envi- ronment, is working with local utilities and with the Southwest Power Pool, a regional transmission organization serving 14 states, including Oklahoma to further understand the implications of the rule. “The governor’s executive order prohibits us from developing a state im- plementation plan and our collective focus is to support the many challenges to the legal underpinnings of the final rule,” Teague says. “Oklahoma state agencies support the Oklahoma attorney general’s efforts as we continue to learn more about potential impacts of the Clean Power Plan from our utili- ties, stakeholders and surrounding states in the region.”


Cooperatives’ Standing Gary Roulet, chief executive officer for Western Farmers Electric


Cooperative (WFEC), a generation and transmission (G&T) cooperative based in Anadarko, Okla., says WFEC is positioned better than some to comply with incoming federal regulations brought by the CPP rule. Roulet says WFEC’s proactive measures over the years to add natural gas fired generation resources and a growing renewable energy portfolio place the power supplier in good standing with diverse generation assets. Still, Roulet acknowledges WFEC’s positioning is one part of a bigger picture and com- pliance for Oklahoma and surrounding states poses costly challenges. “While WFEC might not experience a tremendous impact, we understand we will be impacted as a region,” Roulet says. “We are at risk as to how other utilities will be forced to comply.” WFEC and other utilities in Oklahoma participate in a multi-state electric market, meaning that cost increases by utilities in the region will impact the price all consumers pay for electricity. WFEC supplies the electrical needs of 18 member cooperatives in


Oklahoma, along with Altus Air Force Base, plus four member cooperatives in New Mexico. WFEC joined the National Rural Electric Cooperative Association (NRECA) and 38 other G&Ts in a lawsuit challenging the rule. A concern shared by utility leaders is the probable early retirement of coal- fired generation plants. In most cases, G&Ts hold outstanding debt for these capital-intensive investments. If coal units close prematurely, utilities are still responsible for the debt. These costs would be passed on to consumers. According to Roulet, it is not uncommon for coal-fired plants to have a useful life of 45 to 50 years. WFEC owns one coal-fired generation plant in Hugo, Okla.; the 33-year-old plant has a generation capacity of 450 mega- watts. The Hugo plant has implemented several environmental controls to achieve cleaner coal burning. Given these enhancements, WFEC had planned for the plant to remain a part of WFEC’s generation portfolio in upcoming years. EPA’s Clean Power Plan could change those plans, though it will be WFEC’s goal to continue to operate this low-cost resource for as long as possible. KAMO Power, based in Vinita, Okla., is one of the six G&Ts that own Associated Electric Cooperative, Inc. (AECI) based in Springfield, MO. Jim Jura, AECI chief executive officer, says AECI is well suited to comply with new regulations. “We’re better positioned than most because we have taken steps to add generation in the way of combined-cycle plants and wind farms. The AECI board decided to buy power systems ahead of our needs, which gives AECI an advantage to comply,” Jura says. If the rule is in fact implemented, Jura says some of AECI’s coal-fired units will either be retired or will have their generation significantly reduced. Like WFEC, AECI is a party to NRECA’s lawsuit against the rule. When asked if the rule will impact the price of electricity for Oklahoma’s rural electric cooperative consumers, both managers agree: prices will go up.


EPA CLEAN POWER PLAN TIMELINE On Aug. 3, President Obama announced the Environmental


Protection Agency’s Clean Power Plan to slow climate change


by reducing carbon dioxide emissions 32 percent by 2030. The rule was published in the Federal Register on Oct. 23, 2015.


Below are the key dates leading to the implementation of the plan (unless they are changed by lawsuits or congressional action).


AUGUST 3, 2015


WHITE HOUSE UNVEILS CLEAN POWER PLAN


SEPTEMBER 6, 2016 STATES MUST


SUBMIT THEIR INTERIM PLANS TO MEET CARBON DIOXIDE REDUCTION GOALS


SEPTEMBER 6, 2018


STATES THAT HAVE BEEN GRANTED TWO-YEAR


EXTENSIONS MUST SUBMIT THEIR REDUCTION PLANS


JANUARY 1, 2022


STATES MUST BEGIN COMPLYING WITH CARBON DIOXIDE REDUCTION GOALS


JANUARY 1, 2030 32%


STATES MUST MEET THEIR INDIVIDUAL REDUCTION GOALS, ADDING UP TO A 32 PERCENT NATIONWIDE REDUCTION IN CARBON DIOXIDE EMISSIONS FROM 2005 LEVELS.


Source: NRECA


“If the plan survives all legal challenges—and there are many—the cost of electricity will go up. It’s difficult to pinpoint what the increase would be since there are many unanswered questions at this point,” Jura says. The CPP litigation process is expected to extend several years. Co-op lead- ers agree it is too soon to determine the range of possible rate increases. “Everything we do to lessen the carbon footprint has the potential to make electric rates go up; it’s not easy to say how much they will go up, but we can’t say they will go down. With rising fuel and transportation costs and mounting regulations, it is likely electrical rates will go up in the near future,” Roulet says. Chris Meyers, general manager for the Oklahoma Association of Electric


Cooperatives, says electric cooperatives both in Oklahoma and nationwide continue to advocate for safe, reliable and affordable electricity. “We believe the Clean Power Plan is an overreach of EPA’s authority.


Electric cooperatives are environmental stewards and show leadership in adding renewables as well as compliance of environmental rules. Yet, our mission is to ensure consumers at the end of the line continue to receive reliable and affordable power,” Meyers says. To find out more about the potential impact of EPA’s Clean Power Plan, contact your local electric cooperative.


DECEMBER 2015 7


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