## ESPS Rule - Washington Hearing, July 30, 2014

Comments from Floyd Gilzow, Vice President for Environmental Affairs

Missouri Joint Municipal Electric Utility Commission 1808 1-70 Dr SW Columbia, MO 65203 573-445-3279 fgilzow@mpua.org

My name is Floyd Gilzow, Vice President of Environmental Affairs for the Missouri Joint Municipal Electric Utility Commission, a state entity representing over 60 municipal electric utilities ranging in size from over 120,000 meters to as few as 200. Coincidentally I also happen to be the former Deputy Director of the Missouri Department of Natural Resources. The EPA guidelines as written under Section 111(d) regrettably ignore well established economic principles in the U_S and don't provide enough time to implement the most effective solutions. The EPA admits in their Regulatory Impact Analysis that growth in the availability of electric power in this country has closely paralleled the growth in our economy for decades(at section 2.9 Page 2-251. Yet they also now claim economic growth does not require commensurate electric energy growth today. To whatever degree that assertion may be true nationally at a macro level, and may be differentially true for states with economies weighted toward finance, software, entertainment and tourism, it is not accurate for states such as Missouri that still build cars, produce aluminum, process meat and lumber or have other energy intensive industries. Regulatory fiat cannot divorce the connection between baseload electric power and the growth in the economy. Further the draft guidelines envision an electric generation and transmission system that will be revolutionary, not evolutionary, in the near term. For instance we may not know the details of what Missouri will require until sometime in 2018. However we will be required to start complying with the rules by 2020, achieving over 82% of the final goal in the first nine years. A period of less than two years is not long enough to make and implement decisions that will change one of the nation's largest industry sectors forever and raise customer rates by more than simple double digits for decades in the future. We need at least five years from a final approved State Plan to the implementation of the glidepath toward final compliance.
In closing, I'd also like to pose five unanswered questions not found in the draft rule that I hope that EPA will consider and address in the final rule:1. The Supreme Court appears to say that EPA has the legal authority to limit the amount of CO2 emission coming from an electric generating unit. But what state or federal legal authority can EPA cite that can force the owner of a Combined Cycle Natural Gas Plant to operate their unit at 70% of capacity if they decide not to? And if you can't cite that law, how can we have a Best Available System of Emission Reductions that is both enforceable and measureable as EPA requires?

How expensive does EPA believe that electric power has to become before it curbs the general public's insatiable desire for more and more electric power? And what are the Environmental Justice implications of this approach for financially disadvantaged populations since even EPA admits that the rule will raise electric bills in the short-run.

3. The nation's natural gas system of production and distribution could not meet demands for fuel during weather extremes this past winter. What changes in drilling rates and trenching for new natural gas pipelines does EPA foresee that will allow it to meet the additional demand for NG to generate millions of inegawatt hours of electricity in 2020 and beyond? And what economic and environmental impacts will those shifts have on those who use NG for other purposes such as residential heating?

4. Do cash-strapped state environmental agencies have the financial and personnel resources to implement this multi-level administrative system which must account for generation, transmission, and end-use patterns of electricity across all geographic and demographic boundaries?

5. How does EPA propose that states mitigate the increased exposure to extended electric power outages caused by natural disasters during hurricanes, storms and earthquakes as pipelines are severed and pipeline pump stations are closed down by floods? You see coal plants generally keep 45 days or more of fuel on site to deal with delivery outages, while natural gas plants have only seconds of on-site storage after a disaster. This administration is poised to make the same major policy error that another administration made 40 years ago when they insisted that federal action rather than the marketplace should decide whether we relied on more or less natural gas to generate electricity. Today's reliance on coal for electricity is in large part because utilities were prohibited from building natural gas plants in the 1970's. It is ironic that many of the coal plants these guidelines will force to close are the same ones built when it was illegal to build natural gas plants.
Thank you for your time and attention.