The federal government's plan to lower carbon dioxide emissions across the country is actually a plan to eliminate coal plants, an executive with Entergy Arkansas said Wednesday.

On June 2, the federal Environmental Protection Agency issued its proposals to lower carbon emissions by a nationwide average of 30 percent by 2030.

"There is no reason to pretend that these rules are about anything but shutting down coal plants," said Chuck Barlow, Entergy's vice president for environmental strategy and policy. "If you are looking at EPA models in many states, not just Arkansas, you're talking about shutting coal plants."

Entergy operates two coal-fired power plants in Arkansas.

Barlow's comments were made at a meeting of representatives with power companies, environmental groups and electricity associations, among others, at the Arkansas Department of Environmental Quality office in North Little Rock.

In Mississippi, to meet the EPA's guidelines, that state would have to close all of its coal plants, Barlow said.

"They're not telling Arkansas that it has to [shut down coal plants], and there certainly could be other options," Barlow said. "Arkansas has to decide how it wants to deal with the issues and all the costs."

Arkansas needs to focus on the retirement of some of its older coal-fired plants, said Glen Hooks, senior campaign representative in Arkansas for the Sierra Club.

"About 85 percent of the [carbon dioxide] emissions in the state come from our five coal-fired power plants," Hooks said. "And we have three of those five that [were built] in the late 70s and early 80s and are approaching their normal retirement age."

Arkansas coal plants are: The 528-megawatt Flint Creek plant near Gentry, which opened in 1978; the 1,659-megawatt White Bluff plant near Redfield, with two boilers that opened in 1980 and 1981; the 1,678-megawatt Independence plant near Newark, with two boilers that opened in 1983 and 1984; the 670-megawatt Plum Point plant near Osceola, which opened in 2011; and the 600-megawatt John W. Turk plant near Fulton, which opened in late 2012.

The Flint Creek and Turk plants are operated by Southwestern Electric Power Co. Entergy operates and is a co-owner of the White Bluff and Independence plants. The Plum Point facility has multiple owners.

Because of its dependence on coal plants, which emit higher levels of carbon dioxide, Arkansas will have to reduce its emissions by 44 percent by 2030, said Stuart Spencer, an attorney with the Arkansas Department of Environmental Quality. Only five states have a percent reduction goal by 2030 greater than Arkansas', Spencer said.

There are four primary ways to reduce the emissions, Spencer said. Those include improving coal plant efficiency, using existing natural gas plants more effectively by replacing natural gas power for coal power, increasing renewable energy and nuclear power, and improving energy efficiency in other areas.

Under the EPA's formula for Arkansas to reach the 44 percent reduction in emissions, more than 68 percent of those reductions would come from replacing coal power with natural gas, Spencer said.

Entergy is "very concerned" about the "legal defensibility" of the rules, said Barlow, who called the guidelines "really another level of hell." Entergy is not planning to fight the rules in court, but it is likely some groups will, Barlow said.

Entergy's questions about the rules "run to pages, pages and pages," Barlow said.

The EPA's rule "turns the regulatory cost-recovery paradigm and decision-making paradigm on its head," said Venita McCellon-Allen, president of SWEPCO.

For the history of the Arkansas Public Service Commission, decisions have been made on the lowest-cost impact on ratepayers, McCellon-Allen said. The new rule implies that environmental decisions will be more important than the cost to ratepayers, McCellon-Allen said.

"The stakes are incredibly high for Arkansas on this issue," said Steve Cousins of the Arkansas State Chamber of Commerce.

Arkansas has lost tens of thousands of manufacturing jobs since the early 2000s, Cousins said.

"Increasing energy costs out of proportion with what U.S. competitors pay will threaten the existence of the remaining jobs," Cousins said. "That is just an economic fact."

It is too early to determine what the costs of the new regulations will be, said Colette Honorable, chairman of the Arkansas Public Service Commission.

"We have to really evaluate the undertaking that would be required [to meet the guidelines]," Honorable said. "I couldn't say for certain at this moment that there will indeed be significant costs without also considering what the benefits might be."

The next meeting, which is open to the public, will be Aug. 27 at Department of Environmental Quality offices on Northshore Drive in North Little Rock.

Business on 06/26/2014