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The Real Math on MATS: Delaying Cleaner Energy Just Doesn’t Add Up

Posted by Dan Bakal at Jun 19, 2012 01:45 PM |
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Tomorrow, the U.S. Senate will decide whether to repeal a new rule that reduces toxic emissions from coal-fired power plants. The case against toxics seems clear, but the resolution at hand argues that the new Mercury and Air Toxics Standards (MATS) will increase costs and threaten reliability in the electric power sector.
by Dan Bakal, Director, Electric Power Program Ceres Posted on Jun 19, 2012

Tomorrow, the U.S. Senate will decide whether to repeal a new rule that reduces toxic emissions from coal-fired power plants. The case against toxics seems clear, but the resolution at hand (S.J. Res 37), which was proposed by Oklahoma Senator James Inhofe, argues that the new Mercury and Air Toxics Standards (MATS) will increase costs and threaten reliability in the electric power sector.

His math doesn’t add up. And it doesn’t match what businesses, investors and electric power companies themselves are saying.

Here’s the real math on the support for MATS:

  • More than 125,000 businesses and more than 300,000 individual business leaders, entrepreneurs and investors. That group sent a letter to Senators saying, “…we believe the timely implementation of MATS for power plants is a meaningful step towards economic growth and investment.” Collectively, they represent assets totaling more than $9.5 trillion.
  • 23 businesses representing 500,000 U.S. jobs and annual revenue of more than $100 billion also support MATS. Those companies are members of BICEP, a Ceres-led coalition of name-brand corporations, which has urged Senate leadership to support MATS. “Shifting to lower emissions technologies and resources while upgrading our nation’s electric generation infrastructure will help drive economic growth and create jobs,” the coalition wrote in its letter to the Senate.
  • 34 investors with more than $200 billion in assets under management. That’s the coalition of investors led by Calvert Investments who have argued that “issuing the MATS rule will provide investors and companies the certainty they need to make long-term capital allocation decisions.”
  • The nation’s third largest public pension fund with $150 billion in assets. That’s run by New York State Comptroller Thomas DiNapoli, who recently wrote to Senate leadership about MATS. DiNapoli argued that funds like his are interested in the long term, and that MATS will support his fund’s long-term aims by minimizing exposure to risk.


Then there are the public health benefits MATS was designed to achieve. EPA estimates that that mercury and air toxics reductions will save 11,000 lives and prevent more than 100,000 asthma and heart attacks each year, resulting in tens of billions of dollars in annual savings on medical care.

In addition, states like Virginia and Pennsylvania stand to gain thousands of jobs from the transition to cleaner power. Overall, a report from Political Economy Research Institute at the University of Massachusetts and Ceres estimates that emissions and pollution controls will create more than 1.4 million jobs in the manufacturing, installation and construction sectors.

Are there threats to power supply reliability? The latest research from Analysis Group shows that every major system operator across the nation’s electric grid expects to have adequate resources after implementing MATS. What about cost? Customers in the Mid-Atlantic region, the nation’s largest electricity market, just purchased power capacity at lower than expected prices for 2015, the crucial year when MATS goes into effect.

Utilities themselves are indicating that they are well positioned to comply because of early investments in their generating fleets. Take for example PPL and Ameren, two utilities with sizable coal plant fleets who are on track for compliance. Here’s what they had to say to shareholders during recent earnings calls:

  • Martin Lyons, CFO of Ameren, echoed that statement saying, “We’ve got a lot of controls in our plants, and those controls, those investments are positioning us well in our merchant business for compliance with MATS.”

The transition to reliable, cost-effective and clean power is already underway -  a transition that is unleashing investment, reducing emissions, generating jobs and creating a cleaner electric power fleet to power our homes, businesses and communities.

By defeating Inhofe’s misguided proposal, Senators can ensure that the benefits of MATS and a cleaner power grid will continue to add up.

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Meet the Expert

Dan Bakal

Dan oversees Ceres’ electric power and coal research, shareholder engagement, and furthers the understanding of environmental risks, with a particular focus on climate risk. He works closely with Ceres coalition members, including environmental, investor, labor and public interest groups, to engage in dialogues with electric power companies, which often involve a comprehensive review of environmental policies, performance, and disclosure practices.

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