With the Clean Smokestacks Bill stalled in the N.C. House of Representatives and the current legislative session winding down, the Canary Coalition has made a new proposal in an effort to revive the bill.

While the bill, S1078, passed the Senate by a vote of 43-5 in April of this year, it has failed to clear the House Committee on Public Utilities due to industrial opposition to the utility cost recovery provision. Some industries, while acknowledging the need and health benefits, have resisted the legislation because ratepayers are expected to pay the entire cost of the cleanup. This may be a difficult burden for an economically struggling industry to bear. These industries claim that power plant operators should share the cost of implementing the bill.

The Canary Coalition addresses this issue by offering a proposed variable percentage rate of cost recovery for the utility industry. Initially the proposal calls for a 50-50 split in cost between ratepayers and power plant operators. However, the plant operators can appeal to the Utility Commission to adjust this percentage to assure a reasonable return on capital investments they are entitled to under state law. Also, the cost of implementation would be financed, with payments extended 10 years beyond the period of implementation to 2023. These two provisions would considerably ease the burden on electrical rate paying industries, while allowing the highest standards of pollution control to be achieved through the use of the best available retrofit technology.

Another provision of the Canary Coalition proposal clarifies the prohibition of interstate trading of pollution credits. Federal law has created a system of trading to reduce nationwide levels of pollution. If a power plant on the West Coast, for instance, exceeds federal standards, it can sell pollution credits to a company who owns a sub-standard power plant in North Carolina. The North Carolina plant can use these credits to meet federal regulations without actually reducing emissions. This system has created “hot spots” in different areas of the country where air pollution has become worse. Large areas of North Carolina, including the western mountains and major urban areas in the Piedmont, fall within one of the worst hot spots in the nation. While the assumption until now has been that interstate trading would be banned under the N.C. Clean Smokestacks Bill, the text of the legislation does not make a definitive statement to that effect. The Canary Coalition proposal corrects this oversight.

Avram Friedman,
Canary Coalition Executive Director,
avramfriedman@hotmail.com,
Sylva

 

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