North Dakota's response to limits on carbon dioxide emissions from coal plants will be a two-track approach — litigation and preparation.
North Dakota Department of Health will create the state implementation plan to comply with the U.S. Environmental Protection Agency's Clean Power Plan while North Dakota Attorney General Wayne Stenehjem battles the rule in court, Stenehjem told attendees of the EmPower ND Energy Conference in Bismarck Tuesday.
“It does not make sense for North Dakota to sit back and decide we’re not going to do anything,” Stenehjem said. “We need to be ready and try to comply the best we can while we continue along the litigation path …. If we do nothing, we’ll get a federal plan that will be even worse.”
Under the finalized Clean Power Plan released in August, North Dakota must reduce carbon dioxide emissions from existing power plants by 45 percent by 2020, up from 11 percent when the rules were first proposed.
Health Department Environmental Health Section Chief David Glatt said, when the proposed rules came out, companies weren’t happy but thought “there’s a path forward with this.” When the higher percentage came out in the final rules, they were astonished.
“We didn’t recognize it anymore as compared to the initial rule,” said Stenehjem, pointing out the large difference could be ruled a violation of the Administrative Procedure Act and he likes his chances in court. He said the EPA's Waters of the U.S. rule was recently stayed on these same arguments.
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Stenehjem also questions whether the rules should have been made at all since coal power plants are already regulated under section 112 of the Clean Air Act.
"I think the rule does face some real legal vulnerability,” Stenehjem said.
North Dakota has not joined in any lawsuits filed against the EPA to date, waiting for it to be published in the Federal Register, which is expected later this month. At that time, the state will file a petition for review in the U.S. Court of Appeals D.C. Circuit in hopes of getting a stay on the rule.
“We’re proceeding and ready now so we can file (when it’s published). We’ll be ready to pounce as soon as that happens," said Stenehjem, adding he also plans to file alone rather than join with other states because of North Dakota's coal industry faces unique circumstances. "We need to pursue this on our own."
Stenehjem said another thing working in North Dakota's favor is a recent U.S. Supreme Court ruling on mercury emission standards that requires the EPA to consider costs in the rule-making process.
“I can’t measure CO2 reduction if we shut down all the power plants in North Dakota,” said Glatt, adding that the air might be cleaner but he’s not convinced it will provide a better way of life for North Dakotans.
Energy costs will be higher and jobs will be lost and pay will be less, Glatt said.
“That is something that we have to look at,” said Glatt, explaining the state also was hit hard with compliance issues on renewable energy. “All those wind towers you see, we’re not going to get credit for them.”
Any wind energy installed before Jan. 1, 2013, won’t be counted toward North Dakota’s goal. That omits more than 5 million megawatt hours constructed in 2012 from consideration. New natural gas fired power plants also won’t help with compliance.
North Dakota energy production is 75 percent coal and 25 percent renewables, including 18 percent from wind.
“We have not been sitting on our hands,” Glatt said.
About 55 percent of the energy produced in North Dakota goes to other states.
“I’ve gotten phone calls from the commissioner in Minnesota asking ‘What are you going to do?’" Glatt said. “That tells me there’s a regional impact.”
North Dakota may also have to share some of the credit for wind energy installed more recently with Minnesota. Glatt said the same thing is happening to Wyoming, which houses wind towers that produce electricity sent to California. He said the same transfer did not take place for coal.
North Dakota could buy emission rate credits at an expected rate of $30, totaling as much as $400 million to $450 million to the state annually.
A model plan developed by the EPA for the state also suggests closing two power plants and units at two others by 2018 to meet goals — R.M. Heskett Station in Mandan, Coyote Station near Beulah, one unit of Milton R. Young Station near Center and one unit of Coal Creek Station near Underwood. This would not only affect the workers at these plants but those at the mines supplying their coal.
Glatt said he was unaware of who might have authority to close a plant, but, if a company was found out of compliance and penalized, "it would likely collapse under its own weight."
(Reach Jessica Holdman at 701-250-8261 or firstname.lastname@example.org)