A report released last week finds that adoption of President Obama’s Clean Power Plan will actually reduce the energy costs of consumers and lower costs for states. Synapse Energy Economics released a report that found that if states use renewable energy production and energy efficiency to comply with the Clean Power Plan, they can realize large savings on electricity bills for consumers and businesses.
The Clean Power Plan aims to reduce emissions of carbon dioxide (CO2) from existing fossil fuel‐fired power plants by approximately 30 percent below 2005 levels by 2030.
If states invest in energy efficiency programs, the report states, customers could realize monthly bill savings ranging from $0.50 in Kansas to $94 in North Dakota. Likewise, investing in renewable energy will lower states’ energy costs, and states that invest early will realize the most savings. Kansas is already big in wind energy.
“For the two‐thirds of residential consumers who participate in ratepayer‐funded energy efficiency programs under this scenario, 2030 bills are expected to be $35 per month lower than in a business‐as‐usual scenario and, on average, $14 per month cheaper than residential bills were in 2012,” the report concluded.
Opponents of the Clean Power Plan have predicted if it is adopted, higher energy bills will result. The U.S. Chamber of Commerce, which has many energy and coal companies in its membership, forecasts that the direct and indirect effects of the rule would cost individual families an average of $200 more per year. The EPA and Synapse Energy Economics dispute that assertion.
Even after accounting for households’ share of the cost of energy efficiency, Synapse found, this Clean Power Plan strategy saves consumers money on their electric bills in 2030. The Clean Energy Future energy efficiency investments are aggressive, but realistic: they are based on levels already achieved in several states, the report states. In 2030, investments in high levels of energy efficiency and renewables result in $40 billion of savings in total U.S. electric‐system costs. That is money that will be spent on other goods and services that will benefit local economies.
Synapse analyzed the impacts of the proposed Clean Power Plan on electricity consumers in every state by modeling what would happen if each state invested heavily in energy efficiency and renewable energy. Analysis showed that reducing emissions through the addition of energy efficiency and renewable energy actually lowers electricity costs over the long term compared to continuing with existing practices and policies.
Customers in states that are “first movers”, meaning their states invest in new renewable energy sources early on, save the most. First mover states are able to export clean power in later years to those states that continue to depend heavily on existing fossil fuel plants, which must eventually be retired. States that exceed Clean Power Plan compliance are also able to sell compliance credits to states that miss their targets.
The Synapse scenario projects that all states will obtain higher levels of total national carbon emission reductions—58 percent below 2005 levels by 2030—compared to the 30 percent reduction achieved by EPA’s proposed Clean Power Plan.
Opposition to the Clean Power Plan from coal and energy companies and their various trade associations will continue despite the report. These companies are more concerned with their share value and profits than they are with individual consumers. Republicans and Democrats from coal states are likely to continue opposition to the president’s plan. It remains to be seen if consumers speak out.