October 10, 2017 / 8:25 PM / 9 months ago

Breakingviews: Trump “coal first” drive is blowing smoke

DALLAS (Reuters Breakingviews) - President Donald Trump’s “coal first” drive is under way in earnest. The U.S. Environmental Protection Agency, run by Scott Pruitt, on Tuesday formally set out plans to reverse Obama-era pollution rules. Meanwhile the Department of Energy, run by former Texas Governor Rick Perry, wants regulatory changes that favor nuclear and coal power generation. Even if both happen, the closure of a Texan coal-fired power plant shows the economic and social forces pushing the other way.

Pruitt wants to get rid of Barack Obama’s so-called Clean Power Plan on the grounds it overstepped the EPA’s authority. Though implementation was in any case held up in the Supreme Court, the goal of the CPP was to reduce the damaging smog and emissions that coal plants, in particular, produce.

Perry, meanwhile, wrote last month to the federal electricity regulator urging new rules that would, in effect, subsidize electricity providers capable of holding a 90-day supply of fuel to guard against disruptions. This would notably help coal plants as well as nuclear power installations, for example.

These initiatives may face legal hurdles of their own, and Perry’s could also run up against the Federal Energy Regulatory Commission’s inclination to do things its own way. If they make it into the rule book, however, the impact may still be mainly felt in Trump’s rhetoric as he tries to rally America’s coal country.

Economic forces, starting with low natural-gas prices, are shifting the other way. Just last week, a unit of Vistra Energy said that it would soon close one of the largest coal-powered plants in Texas even as Vistra is investing in solar facilities in the state. Profitability at the coal plant, operating for more than 40 years, has been undermined by low wholesale electricity prices, driven down by abundant gas. Meanwhile concerns about pollution and its effect on the climate are steadily rising among Americans, according to Gallup.

A recent survey by engineers Black & Veatch showed only 2 percent of utilities planned to add coal-fired generation to their power systems. Close to half aimed to add solar or wind power. Trump’s rearguard coal defense looks set to be swept away by more powerful currents.

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- U.S. Environmental Protection Agency head Scott Pruitt on Oct. 10 issued a notice to repeal the so-called Clean Power Plan, an Obama-era regulation that sought to reduce emissions dramatically. In a statement, Pruitt said the CPP had exceeded the limits of the EPA’s authority and was inconsistent with the Clean Air Act.

- Secretary of Energy Rick Perry on Sept. 28 sent a letter to the members of the Federal Energy Regulatory Commission proposing changes to rules governing the U.S. electrical grid. The proposed rules would help subsidize electricity providers capable of holding a 90-day fuel supply, effectively favoring nuclear and coal plants over, for example, renewable energy.

- Luminant, a subsidiary of Vistra Energy, on Oct. 6 said that it would retire its 1,800 megawatt Monticello Power Plant in Titus County, Texas. The plant, in operation for more than 40 years, is one of the largest coal-fired plants in the state.

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