Our Opportunity

Under this plan, Kentucky must slash our rate of CO2 emissions from power plants by 40% or reduce the actual tons of CO2 emitted by 31% in 2030, compared to 2012 levels. Our Commonwealth has already made significant progress towards these goals due to recent coal plant retirements. With careful work, we can design ways to meet or exceed those goals in ways that are good for all of us.

The Clean Power Plan allows states to use creative, home-grown strategies to meet the targets. For example, Kentucky could:

• Direct utilities to expand renewable energy production and energy saving programs.

• Help local governments, businesses and residents slash energy use and control bills.

• Modernize state laws (including expanding net-metering, allowing community solar, and renewing state tax credits) to encourage the growth of renewable energy in every Kentucky community.

• Advocate for debt relief for rural electric cooperatives that significantly expand their energy efficiency programs and renewable energy capacity.

• Invest in our economically distressed communities and displaced workers to ensure all Kentuckians have access to new jobs, energy savings, and improved health during this time of transition.

Of course, Kentucky’s political leaders could also make other choices. They might chose to meet the new rule by burning more gas, garbage, or even wood from our forests to generate electricity – all of which create additional risks for our health and climate. Many Kentucky politicians say they will refuse to submit a plan at all. In that case, the EPA will require utilities in our state to pay for excess pollution using a complicated trading system. Kentuckians would then pay higher rates without the benefits of local clean energy jobs, energy savings, or improved health.

The energy choices Kentuckians make today will affect our lives and future generations. That’s why your voice and vision are urgently needed to Empower Kentucky.

• Kentucky’s homes and industries use a lot more electricity than in most other states. In 2013 we had the 3rd highest per capita electricity usage in the nation, making our economy and pocketbooks especially vulnerable as rates rise. Fortunately, that means we also have good opportunities to save money by improving the efficiency of our homes, buildings and factories. (Source) 

• Today the cost of our coal-fired power is rising sharply. Kentucky’s electricity rates have historically been among the lowest in the nation. However, our rates have climbed steeply in recent years, up 82% from 2000 to 2013. (Source)

• Meanwhile, the cost of renewable energy is dropping steadily. The cost of electricity from utility-scale wind and solar in the US declined by 58% and 78%, respectively, from 2009 to 2014.[1] (Source)

• Kentucky consistently ranks near the top of states with high rates of premature death linked to power plant pollution. Emissions from coal-fired power plants contribute to our high rates of asthma, lung cancer and chronic obstructive pulmonary disease (COPD). Nationally, three out of four African Americans in the US lives within 30 miles of a coal-fired power plant, and African American children are three times more likely to be admitted to the hospital for an asthma attack and twice as likely to die of asthma. (Source)

• Kentucky’s 21 coal-fired power plants released 91 million tons of carbon dioxide, a powerful greenhouse gas, into our atmosphere in 2012. That’s nearly 70% as much CO2 as all of the volcanoes on earth emit in a year. (Source)

• Kentucky lags behind many states in efforts to promote energy efficiency, renewable energy, and clean energy jobs. A majority of states require their utilities to gradually expand energy efficiency programs and renewable energy production. Kentucky does not. We are one of four states to ban solar leasing. We cap the size of grid-tied solar energy systems at a level too small for many businesses and schools. Our state tax credits for energy efficiency and renewable energy expire at the end of 2015. The list of missed opportunities goes on and on. (Source)

• A utility in Benham, KY and a number of Kentucky’s rural electric cooperatives help customers weatherize homes without upfront costs. Those home improvements are paid for over time using money people save by cutting their energy use.

• In Berea, KY, residents can lease solar panels from their utility. The panels are located on city property. Customers get a credit on their bills for the power their panels generate.

• In Glasgow, KY, the local utility is installing in-home batteries on many buildings to help reduce energy costs and pollution associated with times of peak energy demand. 

• In Bowling Green, KY, elementary students learn about energy by studying their own school building, which uses energy efficiently and relies on solar energy. Their school was the first net-zero school to be built in the US.

• The Fort Knox Army base in Central Kentucky has installed many advanced energy systems, including geothermal heating and cooling, efficient combined heat and power (CHP) systems powered by natural gas, and a 2.1 MW solar generating system.

• The Tennessee Valley Authority offers some Kentuckians a premium for solar energy they produce and contribute to the grid. This benefit is available to Kentuckians in TVA’s service territory in southern and western Kentucky, and has been especially popular among farmers.

• A proposal in the Kentucky legislature seeks to make these kinds of clean energy solutions widely available across Kentucky. The Clean Energy Opportunity Act would create 28,000 net new jobs and lower average energy bills by 8-10% over the next 20 years, compared to a business-as-usual scenario.

You may notice that lots of innovation is happening in Kentucky’s municipally owned utilities and rural electric cooperatives. Those smaller utilities can - sometimes - be more responsive to their customers’ demands for better options for energy efficiency and renewable energy. But improved public policies - in the form of new laws and regulations - are needed to grow these programs to scale and ensure they are available to all Kentuckians, including people served by our big investor-owned utilities.

• Sets state-specific pollution reduction goals, based on each state’s energy system.

• Requires states to begin cutting CO2 emissions from their power plant sector in 2022 and meet benchmarks on the way to achieving their 2030 emissions reduction goals.

• Directs states to submit plans for meeting goals in September 2016 or ask for a 2-year extension.

• Gives states many pathways to achieve goals, including expanding energy efficiency and renewable energy; generating more electricity from gas or fuels with lower CO2 emissions (including nuclear, garbage or biomass); improving power plant efficiency; taxing pollution; or participating in pollution trading.

• Offers incentives for states that take early action to expand renewable energy production and offer energy efficiency programs for low-income residents.

• Requires states to demonstrate they listened to many people and groups, including affected workers and low-income and vulnerable communities, during the planning process.

• Imposes a complex cap-and-trade system on utilities (and their ratepayers) in states that do not submit an approvable plan.

Additional information about the Clean Power Plan can be found here.

In August, the EPA released a draft Federal Implementation Plan showing what it will do if a state does not submit an approvable plan. The agency will soon take comments on that draft, and the details could change. But the proposal is a good indication of what we can expect. 

In broad terms, the EPA will require utilities in non-complying states to meet the new standard or pay a penalty for their excess pollution. Kentucky’s utilities would have to buy pollution credits from utilities or energy developers elsewhere who are generating clean energy. This complex carbon trading system will transfer wealth from places that discourage clean energy to places that have embraced it. In Kentucky, our coal-fired utilities might choose to do very little to expand renewable energy and energy efficiency programs, as long as they find it easier to pay the penalty and pass along the costs to ratepayers. Meanwhile, Kentucky ratepayers would face higher rates without getting the benefits of local job creation or improved health.

Many economists and mainstream environmental groups are fond of carbon trading systems, often called cap-and-trade, because they allow the market to sort out the least cost way to limit emissions. For example, if a wind developer in Oklahoma can generate lots of cheap, carbon-free power, they argue, it could be more efficient for coal-fired utilities in Kentucky to buy up those renewable energy credits than to take more expensive steps to transform our energy system here at home.

But environmental justice organizations and communities on the frontlines have grave concerns about a cap-and-trade approach, since it allows big polluters to continue endangering the health of nearby communities. Cap and trade programs are vulnerable to corruption and efforts to game the system. And they are likely to result in an unjust distribution of costs and benefits, with rate-payers in heavily polluting states paying for new clean energy jobs and better health conditions developed elsewhere. That outcome isn’t inevitable. But it is likely, given that so many laws and regulations in places like Kentucky act as barriers to clean energy development within our own borders.

A far better alternative is for Kentuckians to face forward and develop our own homegrown strategies for complying with the Clean Power Plan. There are good options that could allow us to strengthen our economy and create new jobs, protect our health, and do our part to address climate change.

• As part of our state strategy, Kentucky could direct utilities to gradually expand renewable energy and energy efficiency. Proposed legislation to do that would create 28,000 net new jobs and lower average energy bills by 8-10% over the next 20 years, compared to a business-as-usual scenario. (Source)

• By maximizing energy efficiency, Kentucky can improve economic and housing security and drive job creation and retention. Kentucky homes are generally not well insulated, and the cost of heating and cooling is a major monthly expense for most of us. Our manufacturers are also among the nation’s most energy intensive. Kentucky ranked third in the US for per capita electricity consumption in 2013. Fortunately, improving the efficiency of our homes, businesses and factories is one of the cheapest strategies complying with the Clean Power Plan – and it can be a major source of good new jobs. (Source)

• The Clean Power Plan will reduce by more than 25% several forms of power plant pollution that make Kentuckians sick, especially children and the elderly. Cutting emissions from Kentucky’s coal-fired power plants will lower our high rates of premature death, asthma, lung cancer and chronic obstructive pulmonary disease (COPD). (Source) 

• A study found the Clean Power Plan would increase US jobs by 360,000 by 2020, while displacing about 24,200 jobs in the mining and utility sectors nationwide. The EPA’s own analysis of the final rule says it will create tens of thousands of net new jobs in the US, despite some job losses.

• When fully implemented in the US, the rule will result in 1,500 to 3,600 fewer premature deaths, 90,000 fewer asthma attacks in children, 180-1,700 fewer heart attacks, and 300,000 fewer missed work and school days annually. (Source)

• The CPP is expected to generate $155 billion in electricity savings between 2020 and 2030. Residential electric bills in the US will be $85 lower under this plan than without it in 2030, due to increases in energy efficiency. (Source)

• Average global temperatures are rising as a result of higher concentrations of greenhouse gases in our atmosphere, primarily caused by the burning of fossil fuels and forests. Nine of the ten warmest years on record have occurred since 2000. 2014 was the warmest year ever recorded, and 2015 is on track to beat it. (Source)

• Rising global temperatures are contributing to more severe and frequent extreme weather, such as dangerous heat waves, floods, storms, droughts, and fires. Warmer temperatures are leading to sea level rise; ocean acidification; displacement of large populations of people; costly damage to infrastructure; increased water shortages and food insecurity; expanded range of insect-borne diseases; intensification of conflict and violence; and the mass extinction of species. (Source)

• There is time to implement policies, investments, and cultural and economic changes and avoid worst-case scenarios. However, further delay greatly limits our options and chances of success, and increases the costs. (Source) 

• Comprehensive actions and investments are needed now to reduce greenhouse gas pollution and prepare communities to deal with changing conditions. Many meaningful climate actions can also produce other co-benefits, including healthier air and water, energy savings, improved infrastructure, reduced poverty and inequality, and job creation. (Source)