Under the ominous headline “Household electricity bills skyrocket,” a recent USA Today analysis found the average American household pays $300 more a year for electricity than it did five years ago. More onerous, residential electric costs hit a record high of 11.8 cents per kilowatt hour this year and now consume a greater share of Americans’ after-tax incomes than at any time since 1996.
Such increases have been driven largely by two factors. The first is a sharp increase in demand. After dropping in 2009, the paper found electricity demand rebounded to record levels in 2010. According to the U.S. Energy Information Administration (EIA), gains in the energy efficiency of household appliances are consistently offset by the proliferation of new electronic devices such as flat-screen TVs, DVRs, computers, game consoles and smartphones.
Electric rates also have increased due to costs imposed on utilities by new EPA regulations. Those same regulations are forcing many utilities to shutter older power plants rather than spend billions of dollars for upgrades that would push rates even higher. In Georgia, the state’s largest utility has announced plans to close numerous older power plants that provide hundreds of megawatts of affordable electricity. Unfortunately, a shrinking power supply combined with increasing consumption and rapidly escalating costs is not the recipe for stable, affordable electric rates.
Technological advances in shale gas production have resulted in an abundant supply of cheap natural gas in the U.S. But as federal regulators consider greater oversight of the industry — which always adds cost — many questions remain. Further, natural gas producers have shown little willingness to lock themselves into long-term contracts to sell their product at record low prices. What business would?
Natural gas prices have been volatile historically and expecting them to stay as low as they are today is naïve. In its 2011 Annual Energy Outlook, the EIA projects that the cost of natural gas could nearly triple in coming years (to $9.99 per million BTU in 2035 from $3.62 per million BTU in 2009). Building a diverse energy portfolio that includes coal, nuclear and, where economically viable without government subsidies, even renewable resources in addition to natural gas will help shield consumers from such substantial cost increases.
Although opponents would like you to believe that virtually no one is working to develop coal-fired power plants anymore, the facts tell a different story. According to the National Energy Technology Laboratory (NETL), 11 new coal power plants became operational in the U.S. during 2010, the most since 1985. As of July, 23 new coal plants are in the permitting phase, near construction or are under construction.
Why do so many utilities want to build and operate coal-based power plants? The answer, quite simply, is that coal is cheap and plentiful (the U.S. has the largest coal reserves on the globe — we have more coal than the Mideast has oil). And inexpensive fuel means affordable electricity costs for customers. The majority of “studies” that purport to show customers bearing a cost burden due to Plant Washington were paid for by opponents of the project and contain greatly exaggerated claims.
Georgia is no longer in a position to pick and choose between energy resources we like and those we don’t. Nor should ratepayers be asked to pay more for something as basic and important as electricity simply to satisfy the agenda of so-called environmentalists. We need all presently available generation resources, and must work to make all of our energy resources cost-effective and environmentally responsible. Failing to do so only ensures that electric bills will continue to skyrocket, with the greatest impact on those that can least afford it.
Dr. Jeff Edgens is an Assistant Professor at East Georgia College and an adviser with the Committee For a Constructive Tomorrow, in Washington, D.C.
Follow us on Twitter!
What Dr. Edgens's bio fails to note is that he is a Political Science professor, which fully explains why he feels qualified, in spite of an utter lack of industry credentials, to challenge a respected energy industry veteran based on nothing more than clumsily assembled "media reports about U.S. energy demand and costs."
Edgens's irresponsible and fallacious claims (especially the outrageous suggestion that the customers of Power4Georgians member EMCs won't bear a cost burden from the planning, construction and operation of Plant Washington) are exactly what one might expect from an advisor for a lobbying organization substantially funded by fossil fuel companies and other vested interests.
In the end, this is just one more disingenuous, fact-free piece of disinformation (in the style of Dean Alford and Sam Kelly) designed to associate Plant Washington opposition with a specific, negatively-perceived political position. In reality, Plant Washington opponents span all demographics, because the issue has never been about coal but about fiscal accountability, objective due diligence, and the misappropriation of EMC member assets to line insiders' pockets.
And when the writer talks about new coal plants that have come on line in the past year (they started construction before 11/2008) he failed to that the $400,000,000 Spiritwood coal plant in North Dakota is one of those "new" completed plants and it is not running. Why is a shiny new coal plant mothballed? Simple - clean energy like wind and solar, and natural gas are cleaner and cheaper.
Cobb EMC members beware of anyone trying to sell you a coal plant, it is an expensive and unnecessary bet. The reason 161 proposed coal plants been rejected in the past decade is that any serious assessment recognizes this is a fuel of the past, not the future.
Don't get your hopes up regrading the 17 suppliers that responded to the RFP. Cobb's feigned RFPs before through Sherali's Energy Consulting Group. Somehow, the company owned by Brown's buddy Cliff Hare, always was selected despite the relative worth of other proposals. This company still does business with Cobb. It's name is EDF, formerly Eagle Energy Partners. Can you say Forensic Audit?!?!
See more comments in The Marietta Daily Journals "Cobb EMC’s pursuit cools on coal fired power plant."
@Fred from Cobb Read what I wrote to Sixer666.
I don't know if your both out of touch or plants for Dwight Brown.
I wonder how much EMC members had to pay for Brown, Alford, Kelly, Rayder, Sherali and Howell to orchestrate the drivel in this article.
@Scared2 Yes the doc does look angry!
@Elvis Costello Very good rebuttal!
And Take Back Cobb EMC? Calling for transparency but still won't publicly deny it is in fact a front for the Southern Alliance for Clean Energy whose goal is not to increase transparency at Cobb EMC but rather to kill Plant Washington. That is not very transparent.
And if you don't think the price of natural gas is going to go up, you haven't been paying attention to hundreds of years of energy history. Or is it that a barrel of oil is still $17 as it was in the mid-80s?
We all have a vested interest in clear air, clean water, and healthy communities. Pollution and bad business decisions do not adhere to county lines. This problem is bigger than Cobb EMC's.
Coal is perhaps the most environmentally destructive form of energy known to man. What we know is that the Cobb EMC membership overwhelming has rejected the current corrupt board, and we can expect the remaining board is liable to be sacked this spring--for good reason. Therefore, these decisions should be made after the members such as myself have put in a new Board, which will be responsible for dealing with this proposed plant, so it should not be handed off to a completely new board. And, if the new board wants to consider this plant, it should start with feasibility studies, which should have been done a long time ago.
You've betrayed your own lack of expertise with the industry by failing to note that what Cobb EMC needs (and has now solicited) is peaking power, not baseload power. A coal plant can't easily be cycled on and off to meet the fluctuating demands of Cobb EMC's customers and really doesn't fit our needs. I don't know about you, but I don't want to pay for something I don't need, especially when it's going to cost billions of dollars.
Furthermore, if you were as well-versed as you pretend, you'd know that new EPA rules haven't taken effect yet, so blaming the EPA for rate changes is pretty ridiculous. And you'd know something about the financial sector's assessment of coal plants, i.e. that it's getting more difficult to get a loan to build them (the US Government stopped making loans for new coal plants in 2008 because it's too risky). Or that a financial pro forma is Plant Construction 101, and the fact that one was never done for Plant Washington is an egregious error that, to me, indicates either incompetence or foul play.
Millions of dollars have already been spent on a projected $2.1 billion construction project. We shouldn't spend another dime to see Mr. Brown's dream project come true!
If Cobb EMC is bringing transparency and accountability back to our co-op, then it's time to do a real study on the feasibility of Plant Washington and finally give us facts, not opinions, on why we need to invest billions in this plant.
Not only is his commentary horribly misleading as noted by reader “Elvis Costello” but it’s researched so badly he wouldn’t get a passing grade if this was a high school paper.
Possibly my favorite part of all this is that Mr. Edgens is affiliated with an ideologically-driven organization, CFACT, that receives donations from companies that mine coal (or blast mountains apart to get at it), drill for oil (and then spill it everywhere), and generally want to maintain their stranglehold and their record profits.
Cobb EMC members aren't stupid, Mr. Edgens, and it'll take a little more substantiation to demonstrate these claims. Plant Washington is a money-making scheme, full stop.