Finding nuclear case less compelling, commission caps allowable costs through 2013.

Update courtesy of Utility Regulatory News #4037: Citing last spring’s earthquake in Japan, ongoing economic woes, and faltering Congressional enthusiasm for carbon regulation, the North Carolina Utilities Commission has retreated from its prior showing of strong support for an electric utility’s proposal to further develop and expand its nuclear facilities.

The utility, Duke Energy Carolinas, had announced plans to augment its Lee Nuclear Station in South Carolina. When the project was first proffered, the utility had averred that growing demand, as well as the likelihood of carbon legislation within the foreseeable future, made it prudent to add more nuclear resources to the utility’s generation portfolio. However, given the questions about nuclear safety that had arisen since the Japan earthquake, and noting that Duke Energy has suffered continued load loss as a result of the moribund economy, the commission found that the utility’s present nuclear plans might be too ambitious.

Moreover, the commission pointed out that recent changes in the political composition of Congress made carbon regulation a more distant possibility rather than a nearer-term certainty. Consequently, the commission, while still allowing Duke Energy to proceed with certain aspects of its plan, decided that the project should have a cost cap, which the commission set at $120 million for the four-year period ending December 31, 2013. For the full story, subscribe to URN.

Posted: October 18th, 2011 under carbon regulation, nuclear.
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Holds that it may be challenged in federal court

Update courtesy of Utility Regulatory News #4027: Despite the fact that a Montgomery County, Maryland ordinance imposing a new levy on carbon dioxide (CO₂) emissions specifically refers to that levy as an “excise tax,” the U.S. Court of Appeals for the Fourth Circuit has declared it a regulatory fee instead, in that the assessment in effect is applicable to but a single generator.

The ordinance requires electric generators producing more than one million tons of CO₂ emissions per year to pay a levy of $5 per ton of CO₂ emitted. However, because only one generator meets that output threshold, the court ruled that, regardless of the terminology used in the ordinance, the assessment is in fact a fee, not a tax, because a tax is a burden that must be generally borne, whereas a fee can be more of an individual burden. Consequently, the court held that the one generator is not foreclosed by the Tax Injunction Act from appealing the ordinance in federal court. That law prohibits federal courts from exercising jurisdiction over tax rulings involving local authorities. However, because the CO₂ levy has been distinguished from a tax, and because the ordinance explicitly refers to its regulatory purpose in reducing greenhouse gas emissions in the county, the court found that the CO₂ fee structure was beyond the ambit of the Tax Injunction Act, such that the generator could proceed with its challenge of the ordinance before a federal district court. For the full story, subscribe to URN.

Posted: July 13th, 2011 under carbon regulation, energy policy, regulation.
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LOCKHEED MARTIN SPONSORS FREE ACCESS TO EXCLUSIVE CONTENT.

Vienna, Va.: Public Utilities Fortnightly magazine launched a new twice-monthly online resource today. Fortnightly’s Green Utility (http://greenutility.fortnightly.com) features content developed by Fortnightly’s editorial staff, focusing on renewable power generation technology, finance and regulatory policies in the United States and Canada. The new editorial resource is made possible with sponsorship support from Lockheed Martin.

Fortnightly’s Green Utility will feature exclusive articles, webcasts, intelligence and commentary, as well as special access to related articles from the archives of other publications at Public Utilities Reports Inc. — including Public Utilities Fortnightly, Fortnightly’s Spark and Utility Regulatory News.

“Green Utility will focus Fortnightly’s editorial analysis on the challenges and opportunities of building out North America’s renewable energy infrastructure,” said Michael T. Burr, Fortnightly’s Editor-in-Chief. “Fortnightly brings the world-class editorial expertise to look beyond the news and hype, and analyze renewable energy issues in a way no other publication does. Lockheed Martin’s support allows us to make this unique and objective analysis freely accessible online.”

Fortnightly’s Green Utility is part of Fortnightly.com’s growing inventory of online resources. In the past two years, Fortnightly.com launched two financial databases — the Utility ROE Database and the Transactions Database — providing data about utility ratemaking decisions and financial transactions, such as mergers, acquisitions and debt issues.

The March 1, 2011, installment of Fortnightly’s Green Utility, with a webcast and article developed by Fortnightly Contributing Editor Steven Andersen, features a conversation with tax-credit guru Keith Martin of Chadbourne & Parke. The second installment is scheduled for release on March 15.

PUBLIC UTILITIES FORTNIGHTLY (www.fortnightly.com), published by Public Utilities Reports Inc., in Vienna, Va., is the journal of record for the U.S. utility industry, providing authoritative, in-depth analysis of trends in generation, transmission and distribution of electricity and natural gas. For more than 80 years, Public Utilities Fortnightly has delivered exclusive interviews and expert analysis to help utility-industry executives and regulators decide where to invest, how the industry will be regulated and what the future holds. Subscription rate: $287/year.

Posted: March 1st, 2011 under IGCC, R&D, biomass, carbon regulation, climate change, efficiency, electric vehicles, geoengineering, green energy, offshore wind, regulation, renewable energy credits, renewables.
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States to defend 2nd Circuit common law ruling

Courtesy of Utility Regulatory News #3998: An appeal of a Second Circuit decision that resurrected various nuisance lawsuits against five electric generation companies has landed before the U.S. Supreme Court.

The appellate court order was rendered when Justice Sonia Sotomayor was serving on the Second Circuit. She has recused herself from associated Supreme Court deliberations. The cases originated with eight states, one municipality, and three private entities filing suit against the generating companies. Asserting that the scientific consensus is that the emissions from such fossil fuel-fired facilities are a primary cause of global warming, the complainants sought the specific remedy of abatement.

A federal district court had dismissed the cases, saying that any consideration of nuisance arguments would be premature without a prior ruling on underlying environmental policy. The Second Circuit, however, determined that environmental statutes, such as the Clean Air Act, had not preempted the common law doctrine of public nuisance. According to the appeals court, the public health dangers stemming from climate change are undisputed, and since the Environmental Protection Agency has not yet promulgated standards for carbon dioxide or other greenhouse gas emissions, there was no basis for dismissing the nuisance claims outright. For the full story, subscribe to URN.

Posted: December 23rd, 2010 under Uncategorized, carbon regulation, climate change.
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Business Roundtable asks Sen. Reid to Intervene

Fortnightly obtained today the following letter from AEP CEO Michael Morris, which was sent to Senate Energy Committee Chairman Harry Reid under the auspices of the Business Roundtable. This is especially interesting given Morris’s work to help craft workable GHG legislation in Congress.-MTB

>>>>>>>>>

The Honorable Harry Reid

Majority Leader

United States Senate

Washington, D.C. 20510

The Honorable Mitch McConnell

Minority Leader

United States Senate

Washington, D.C. 20510

Dear Majority Leader Reid and Minority Leader McConnell:

The Environmental Protection Agency (EPA) has finalized or soon will be finalizing several regulations under the Clean Air Act addressing greenhouse gas emissions from power plants and major industrial sources. While these regulations will be challenged in the courts, the lack of a clear regulatory roadmap for these and future regulations affecting greenhouse gas emissions has created additional investment uncertainty for large portions of the utility and manufacturing sectors of our economy.

EPA and most industry participants agree that the Clean Air Act is not well-designed to regulate ubiquitous pollutants like carbon dioxide emissions, whose impact is global, not local or regional. Congress never envisioned that the Clean Air Act would be used to regulate carbon dioxide emissions and EPA has struggled mightily to tailor a regulatory program for greenhouse gas emissions under the Clean Air Act that makes sense. For this reason, Business Roundtable long has advocated Congressional action and international cooperation to address the climate issue. Without comprehensive legislation and global agreements encompassing other major emitting nations, EPA regulations only will increase energy costs for U.S. companies, thereby reducing their competitiveness in international markets, and drive up consumer costs, while doing little to reduce global concentrations of greenhouse gas emissions.

Unfortunately, it does not appear that Congress will act on comprehensive energy and climate legislation this year. It does have time to enact legislation that would delay the effectiveness of EPA regulations for up to two years, as proposed by Senator Rockefeller, until the next Congress has the opportunity to address the climate issue legislatively. We urge the Senate to do so. A two year delay will give Congress and the Administration time to work with a variety of stakeholders to develop new approaches, such as those advocated by Business Roundtable in its Balancing Act and Unfinished Business studies, focusing on new technologies and efficiency, as promising ways of addressing the climate challenge. A focus on developing needed technologies not only will help reduce greenhouse gas emissions but it will also help develop the industries of tomorrow and result in a more secure energy future.

A vote to delay pending EPA greenhouse gas emissions will provide Congress the opportunity to develop sound policy approaches to address greenhouse gas emissions, rather than default to a poorly designed EPA regulatory approach that is likely to further damage U.S. competitiveness, drive up consumer costs and make an immaterial contribution to reducing global greenhouse gas concentrations. Business Roundtable respectfully urges a favorable vote on legislation that would delay the effective date of EPA regulatory action with respect to greenhouse gas emissions.

Sincerely,

Morris-1

Michael G. Morris

Chairman, President and CEO

American Electric Power, Inc.

Chairman, Sustainable Growth Initiative

Business Roundtable

C: United States Senate

Posted: September 15th, 2010 under Current News, carbon regulation, climate change, coal, energy policy, green energy, regulation.
Comments: 1