TaEPHONE: 502·564-3350 

TEI.l!FAX: 502-564-7484 

http://eec.ky .gov 

July 27, 2015 

The Honorable Gina McCarthy, Administrator 

United States Environmental Protection Agency 

Ariel Rios Building 

1200 Pennsylvania Avenue, N.W. 

Washington, DC 20460 

Dear Administrator McCarthy: 

In the waning days before the release of the final Clean Air Act 111 (d) rule regulating 

greenhouse emissions from existing electric generating units, I wanted to take one last 

opportunity to reiterate a few important points about Kentucky's environment and energy future. 

I feel this is necessary to ensure that you and others truly understand the transition that 

Kentucky's energy profile is now undergoing; this will result in tremendous carbon dioxide 

reductions from this sector, with or without the Clean Power Plan. 

Since the 111 (d) proposal in June of 2014, complaints have been voiced by some about 

the perceived leniency of the carbon dioxide reduction target that Kentucky and other coalheavy states received. I'm sure you have received those comments as well. However, the 

perception that Kentucky has not implemented any measures to reduce greenhouse gases, nor 

will have to take any actions under the proposed Clean Power Plan (CPP), is not only unfair, it 

is incorrect. 

As you are aware, Kentucky's electricity generation is approximately 93% coal-fired. 

However, that is changing rapidly and is changing at a considerable economic cost. Kentucky 

ratepayers will have to absorb approximately $4.5 billion in pollution control and retirement costs 

due to the Mercury and Air Taxies Standards (MATS). That is a cost of $1,000 for every man, 

woman and child in the commonwealth. The MATS rule alone has a carbon dioxide reduction 

benefit of an estimated 22 million short tons, annually. Our utilities and our regulatory agencies 

(Division for Air Quality and Public Service Commission) have been very aggressive in meeting 

these requirements in a timely and effective manner. So, we have not been "doing nothing"; 

rather, we have been moving forward. 

When most people think of Kentucky, they probably don't think of energy efficiency. 

That is both unfortunate and unfounded. While we do not have a mandatory energy efficiency 

resource standard, we do in fact have many programs that are achieving significant tangible 

reductions in energy use and carbon emissions. Just as one example, I refer you to: 

http://www. forbes.com/sites/peterdetwiler/2012/12/1 0/net-zero-schools-in-kentucky-models-for· 

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Kentucky's energy future, like the rest of the country, is yet to be determined. Changes 

are occurring as a result of both market forces and other regulatory mechanisms. In Kentucky, 

this shift is coming in the form of new natural gas combined cycle plants; therefore, dispatch to a 

cleaner fuel is occurring commensurate with building block 2 of the CPP. As far as fuel costs, 

natural gas is competitive with coal; but Kentucky's ratepayers are picking up the capital costs 

to build new gas-fired generation. As I've said on numerous occasions, our manufacturing 

economy is vitally important to the nation as a whole, and it is imperative that our remaining coal 

units are not forced to close before the end of their useful lives. Stranded coal assets do not 

serve the interests of Kentucky or the nation. 

I appreciate the effort EPA gave toward recognizing the unique differences among all 

states in its proposed CPP rule. I hope this consideration has withstood the unfounded criticism some have lodged against the EPA regarding the different rates assigned to states. You wisely 

accounted for differences in such things as population, economic base, and natural resources in 

determining emissions rates. Please do not lose sight of these key variables with the final rule. I 

truly appreciate your openness in discussing these complex issues as you work to reduce 

greenhouse gas emissions. 

Sincerely yours, 

Leonard K. Peters 

Secretary