Tuesday, August 21, 2012

EPA Curbs on Coal Plant Pollution Overturned

A U.S. Court of Appeals in Washington today overturned the EPA's cross-state air pollution rule, which was to be used to limit harmful emissions from coal powered electrical plants.  This is a win for the coal industry and utilities with lots of coal generation and an short-term setback to the natural gas industry and people who don't like to breathe polluted air.

In the end, however, I think it is really more of a "stay of execution," as one analyst put it, for aging coal plants.  Market forces (i.e. lower, more stable natural gas prices) and the threat of future regulation (both federal, state and local) have largely convinced utilities that older coal plants are more of a burden than a benefit.  Coal generation is not going away, but it will be a smaller player on the power scene going forward. The difference is that the utility industry will have more control over timing.

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