Other States Impacted by Calif. 'Clean' Power Rule

A new state policy aims to reduce California's smog "exports" by requiring out-of-state power providers to meet the same clean-air standards as in-state plants. The plan is getting a mixed reaction in states such as Wyoming, where new power plants are already on the drawing board.

ALEX CHADWICK, host:

Now to the environment in California, where energy regulators want the state's utilities to stop buying electricity from new out-of-state power plants that do not meet California's air quality standards. The policy could reshape development of power plants throughout the West. NPR's Scott Horsley reports.

SCOTT HORSLEY reporting:

Northeastern Wyoming, west of the Black Hills, might be called the Saudi Arabia of coal. Smokestacks rise along I-90 from power plants that turn that coal into kilowatts.

Mr. JASON MARSDEN (Wyoming Conservation Voters Education Fund): The Powder River basin is the muscle behind America's coal industry in many ways.

HORSLEY: Jason Marsden is executive director of the Wyoming Conservation Voters Education Fund.

Mr. MARSDEN: And as a big employer, as a big tax revenue generator, it is also an air pollution emitter.

HORSLEY: The power from these plants and others still in the planning stages could help to light cities in Wyoming, Colorado and other Western states. But the biggest potential market, California, may soon be off limits. The California Energy Commission has just adopted a policy saying utilities in the state cannot buy electricity from new out-of-state plants unless they're as clean as the most modern natural gas-fired plant. The move is part of a push by California to limit production of greenhouse gases thought to be responsible for global warming. The draft policy still needs approval from Governor Schwarzenegger and could face legal challenges. But if it sticks, Energy Commission Chairman Joe Desmond says, smoggier coal-fired plants outside California may have trouble getting off the drawing board.

Commissioner JOE DESMOND (Energy Commission Chair: We can't require other states to have the same emissions regulations that California does, but what we can do is that we hold those utilities who buy on behalf of California's consumers to a objective standard. In doing so, we're able to shape and influence the type of plants that would likely be built to serve California's needs.

HORSLEY: California has hardly any coal-fired plants of its own, but it does rely on coal-burning plants outside the state to meet nearly 20 percent of its electricity needs. California gets the kilowatts; its Western neighbors get the air pollution. Some neighbors, like Jason Marsden of Wyoming Conservation Voters, welcome California's newfound interest in cleaning up their air.

Mr. MARSDEN: You know, this is a tourism state with beautiful mountain vistas and obviously we wouldn't want to lose that just in order to sell power at a marginally cheaper rate to out-of-state customers.

HORSLEY: But others are wary. Steve Waddington runs the Wyoming Infrastructure Authority, which is working on a high-power line to carry electricity from his state to Utah, Nevada and ultimately California. He warns the policy would effectively deprive California of an abundant source of energy to meet its future needs.

Mr. STEVE WADDINGTON (Wyoming Infrastructure Authority): The practical implication of this policy is a prescription for natural gas-fired generation being the only acceptable solution. And at today's natural gas prices, that's going to be a painful prescription for consumers in California.

HORSLEY: Energy Commissioner Desmond insists California is not giving up on coal. In fact, he says the state's willing to pay a premium for power from clean coal plants, a price that would ultimately be borne by California rate payers.

Commissioner DESMOND: If we're asking for these standards, two things that we see happening. One is it moves technology forward. It also, you know, signals a willingness to say we will factor in the costs of securing that clean energy appropriately.

HORSLEY: Earlier this month, the US Energy Department announced plans to build a demonstration clean coal plant at a cost of nearly a billion dollars. Skeptics of the California policy wonder if the state's really willing to invest in similar plants. If so, power line developer Waddington says that could be the silver lining in an effort designed to reduce clouds of greenhouse gas. Scott Horsley, NPR News, San Diego.

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