Colorado poised to meet EPA carbon pollution targets

DENVER – The U.S. Environmental Protection Agency unveiled Monday a proposal to reduce carbon emissions from power plants by 30 percent below 2005 pollution levels by 2030 as Colorado conservation groups applauded the measure and utilities appearing mixed on the proposal.

The Obama Administration also proposed reductions in particle pollution, nitrogen oxides and sulfur dioxide by more than 25 percent through the program, called the Clean Power Plan. EPA contends the proposal will help reduce carbon emissions that fuel climate change as well as cut premature deaths, asthma attacks and missed days of work and school by reducing respiratory ailments caused by pollutants.

“By leveraging cleaner energy sources and cutting energy waste, this plan will clean the air we breathe while helping slow climate change so we can leave a safe and healthy future for our kids,” EPA administrator Gina McCarthy said in a statement.

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Power plants account for roughly one-third of the nation’s greenhouse gas emissions. The EPA already limits arsenic, mercury, sulfur dioxide, nitrogen oxides and particle pollution that power plants can emit, but for the first time it will seek to reduce carbon pollution levels.

The EPA said its proposal will shrink electricity bills “roughly 8 percent by increasing energy efficiency and reducing demand in the electricity system.”

Utilities in the Boulder Valley and Northern Colorado were mixed on the proposal.

Xcel Energy Inc. (NYSE: XEL) chief executive Ben Fowke said in a statement that EPA’s rule had the potential to significantly change how electricity is produced and consumed nationwide.

“Xcel Energy has taken steps over the past decade to reduce emissions at a reasonable cost to customers, and these steps should help us respond to this rule,” Fowke said.

Xcel Energy, which provides service in the Boulder and Greeley areas, has reduced its carbon dioxide emissions by 19 percent from 2005 levels and aims to achieve a 31 percent reduction in carbon dioxide emissions by 2020.

The reduction in carbon dioxide emissions comes as the company has increased its use of renewable resources to 20 percent last year, up from 7 percent in 2004. It plans for renewables to reach 27 percent of its energy mix by 2020 by adding wind and solar generation.

Colorado has required Xcel to provide 30 percent of electricity from renewable sources by 2020. Conservationists noted that Colorado is well-prepared to follow the regulations.

“We do have a head start, certainly, on making those reductions,´ said John Nielsen of Boulder-based environmental group Western Resource Advocates during a conference call with reporters. “(Based) on the data that we’ve seen from utilities and the projections that they’re making, we’re on a path to get into that 20 to 25 percent reduction range by 2020.”

The state Legislature also has mandated that rural electric cooperatives generate 20 percent of electricity from renewables.

Fort Collins-based Poudre Valley Rural Electric Association, which supplies power to residents and businesses throughout Northern Colorado, buys electricity from Tri-State Generation and Transmission. Tri-State gets more than half of its electricity from coal-fired power plants.

Amy Holmquist, spokeswoman for Poudre Valley REA, said the distribution cooperative would have to wait until the state of Colorado acts until it knows exactly how the proposal will affect electricity rates. The EPA will task states with carrying out its proposal.

“There is definitely a possibility that Tri-State could raise rates if it has to go through drastic measures to make changes to coal plants,” she said. But, “As of right now, we really don’t know what the effects will be.”