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AT: Regulations increase prices

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AT: Regulations increase prices

The CP involves a range of flexible enforcement mechanisms that allows utilities to achieve emissions reductions at very low cost – the aff arguments assume inflexible regulation

Lashof, 12 – director of the climate and clean air program at the Natural Resources Defense Council (Daniel, “Closing the Power Plant Carbon Pollution Loophole: Smart Ways the Clean Air Act Can Clean Up America’s Biggest Climate Polluters” December, http://www.nrdc.org/air/pollution-standards/files/pollution-standards-report.pdf)
Third, the recommended program gives each source several ways to comply.

n A source may comply by meeting the emission rate standard on its own.

n A set of sources may comply by averaging their emission rates. For example, a coal plant may average with a gas plant, such that their total emissions divided by their combined electricity output meets the applicable state standard.

n A source may comply by acquiring qualifying credits derived from low- or zero-emitting electricity generation. For example, an NGCC plant would earn credits reflecting the difference between the required state fleet average standard and its emissions per megawatt-hour. A wind plant would earn larger per-MWh credits, reflecting the difference between the state standard and its zero-emission rate.

n Finally, a source may comply by acquiring qualifying energy efficiency credits, reflecting incremental reductions in power demand (sometimes called “negawatt-hours”), which earn credits at the same rate as other zero-emission sources listed above.

The EPA emission guideline document would need to specify the rules and protocols for these compliance options. Because the compliance responsibility remains with the sources in the regulated category, and because all of the eligible compliance measures reduce or avoid emissions from covered sources in that category, these compliance options are fully compatible with the definition of a standard of performance. 39

The recommended program structure allows, but does not require, states to reach agreements to allow sources in more than one state to average their emissions, or to use compliance credits generated in another state.

Building these types of emission reduction options into the emission guideline for compliance serves several important functions:

n It expands the range of compliance techniques available to each covered unit.

n It provides an incentive for early action because measures that reduce emission rates any time after the end of the baseline period automatically count toward compliance.

n It taps the most economically efficient means of reducing emissions, including energy efficiency and non-fossil supply options.

n It reduces the overall system cost of achieving any specified percentage improvement in sources’ emission rates, thus allowing achievement of the greatest possible pollution reduction within any given cost constraints.

n It equalizes the marginal cost of emission reductions for owners and operators of different types of plants within a state and eliminates the need for different standards for different types of power plants, given the ability to use emissions averaging and/or emission reduction credits, rather than meeting the standard on site.

Whether a standard of performance set at a particular level is achievable at a reasonable cost must be assessed taking into consideration all of the permissible means of compliance. An emission rate may be unreasonably expensive to achieve if the source’s only options are measures taken at the source itself to reduce its direct emission rate. If the standard allows sources the option of additional means of compliance, as this proposal does, through averaging and crediting mechanisms, then the source’s cost of compliance will be substantially lower. Thus, EPA needs to analyze the cost and achievability of potential standards on the basis of all the compliance options that are available to plant owners and operators, including these emission credit compliance options.Based on this program structure, EPA would determine the appropriate emission rates to be met in each state. The emission rate for each state must reflect the best system of emission controls that has been adequately demonstrated, taking cost into account. In this context, the key question is the impact on the integrated system of electric generating units within a state.

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