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Summary:

With the EPA proposal, the cleantech sector cheers.

The Environmental Protection Agency has just proposed the most aggressive plan to fight climate change to come from the U.S. to date. On Monday, in a speech by EPA Administrator Gina McCarthy, the EPA proposed rules to reduce carbon emissions from power plants by 30 percent by 2030.

While the plans will take a long time to implement (if it doesn’t get blocked along the way) and will face protests from power plant companies that own a lot of coal plants, one thing is clear: the news is a large and historic push for clean energy and energy efficiency technology in the U.S. This is a major step for the cleantech sector, which has faced hard times over the past few years.

coal

Essentially, the EPA’s plan means that power plant owners and utilities over the coming years will need to reduce their reliance on carbon-emitting coal plants, which provide 39 percent of the nation’s power. They’ll have to add more cleaner burning natural gas and  zero-carbon energy sources like solar and wind, and increase the use of energy efficiency. There are close to 600 coal plants in the U.S.

The ruling lets states control how they want to meet those targets. This is particularly important for energy efficiency technologies because reducing energy use is the cheapest way to lower carbon emissions, compared to building new generation capacity. States that can’t swiftly close coal plants, or build out new generation immediately, will likely choose to make buildings run more efficiently.

States can also implement cap-and-trade programs, like the one California introduced in 2012. Cap-and-trade programs set a cap on greenhouse gas emissions and create a marketplace where companies can trade allowances (a pretty good explanation here).

NRG Energy CEO David Crane and Energy Secretary Ernie Monitz cutting the ribbon at solar farm Ivanpah, just outside of Las Vegas

NRG Energy CEO David Crane and Energy Secretary Ernie Monitz cutting the ribbon at solar farm Ivanpah, just outside of Las Vegas

McCarthy noted in her speech that the EPA proposal will be important to investors focused on clean energy and energy efficiency. She said the ruling “gives entrepreneurs and investors more options”:

“Our plan pulls private investment off the shelves and into our clean energy revolution, and sends it in every direction, not just one or two. The opportunities are tremendous.”

To cleantech entrepreneurs and investors, this proposal is huge. Phil Giudice, the CEO of grid battery company Ambri, says:

“I fully expect we will look back on these rules as an important milestone in moving our country and our planet to a lower carbon energy future. Further I suspect the cost of this transition will parallel the move to reducing sulfur emissions (e.g. acid rain)  which through the innovation of the private sector was accomplished at much much less than the expected cost.”

Colin lu Duc, a partner with Generation Investment Management, tells me that the EPA proposal “signals that dirty energy is yesterday’s business model and that clean innovation is tomorrow’s.”

“This plan will take time to implement and will be subject to significant push back from incumbents, but we believe it will eventually be implemented and create larger markets for clean solutions.”

Nest ad screenshot

Beyond the effects of the proposal within the U.S., the plan will also help the U.S. meet its international carbon emissions goals. Le Duc says the rule “allows the USA to participate in international climate negotiations with significantly more credibility.” Generation has its headquarters in London and invested in companies like smart thermostat maker Nest and solar installer SolarCity.

Billionaire Tom Steyer, who’s pumped millions into clean energy and efficiency, said in a statement:

“The Administration’s plan to end this carbon pollution loophole will establish a level playing field for advanced energy solutions that are cleaner, affordable and more secure. Now, more than ever, the United States must be a global leader in addressing climate change.”

Expect the EPA ruling to get significant pushback over the coming months, particularly from states that might see electricity prices rise through the energy rehaul. Senate minority leader Mitch McConnell, a Republican, tells Bloomberg that he plans to introduce legislation in the Senate to block the rules from taking effect.

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  1. Over the past 6 years of the Obama Administration has continued to give the Oil and Gas Industry what they want. Climate Change is real and a solution must include a new type of large-scale power plant that’s cleaner, cheaper and safer than fossil fuel or nuclear power plants. The EPA is aware that congress will block their proposal, and things will be dramatically worst by 2030. The amount of campaign contributions to the President Obama and congress ensures that a policy of great speeches will be followed with little or no action. The EPA Proposal may sound good, but like other Obama Promises, it will fall short of being implemented if it requires moral courage to do so.

    Allen Hydro Energy Corporation offers the world an alternative power plant that’s cleaner, cheaper and safer than burning fossil fuels. AHEC Hydro Power Plants can be constructed and operational in 9 to 12 months using a rapid. However the Obama Administration is not interested in discussing this type of innovative solution. I guess you have to be a campaign contributor like to Solyndra Solar to get access.

    Charles E. Campbell, Founder & CEO
    Allen Hydro Energy Corporation (AHEC)
    ahecgreen@live.com
    614-668-0327
    http://www.ahecEnergy.com

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    1. (97 pct of all scientists state that climate change is bogus .

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  2. Do the math.
    Clean energy is great, but what is currently being touted by folks simply cannot meet the demand – it will only drive up the cost of electricity.

    It is 2014, and we need to start thinking clearer, and shed ourselves of those old biases and scare tactics that have dominated us in the past — take, for example, a open-minded look at FLIR Thorium Nuclear — safe, cheap, no weapons-grade residue, will actually use our existing piles of current technology nuclear fuel waste in the process……..

    The only downside is the reluctance of many to even LOOK and CONSIDER nuclear……time to change our preconceived ideas – this isn’t your grandfathers system!!

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    1. @Kyle: Today’s nuclear is no better than your grandfather’s nuclear. Last year, Progress Energy (Duke Energy) bungled a reactor retrofit and delaminated the containment vessel, then scrapped the whole plant. The plant was Crystal River in Florida. This was a first in the industry — nobody had ever botched that procedure in the history of US nuclear energy. So as long as humans are in the loop, accidents will happen.

      Secondly, renewable energy sources don’t need to replace all existing dirty sources today. The existing technologies can already make a huge dent in dirty power generation. Once we have even lower costs and better storage, we can complete the transition. Kennedy didn’t ask for a trip to the moon within a month :)

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    2. Look at the history of the promises of Nuclear. In the 50’s they were talking about electricity so cheap, metering it would cost more than what would be sold through the meter. It also promised to be safe. 50 years later, nuclear continues to be the most expensive form of energy we have and waste management continues to be it’s greatest challenge. Not to mention repeated failures of world class facilities. They don’t fail often, but they don’t have to fail often to be a very serious threat.

      You want to talk about “only driving up the cost of electricity”? That’s exactly what nuclear has done for us.

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      1. That might be the case here, but do your research and see what it costs in France, where, as far as I know, they have never had a nuclear accident. I believe a few years ago that the’r electricity costs were in the region of 4 cents per kilowatt hour! Thai is CHEAP! Nuclear is the ONLY way to go for cheap energy!

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        1. @Pete: “Do your research” you say? “France never had a nuclear accident” you say? How about a dozen of them, amounting to a few hundred million $. Next door in Germany (where folks are quite decent with their engineering skills too) had accidents that set them back a cool billion $.

          http://en.wikipedia.org/wiki/Nuclear_accidents_by_country#France

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          1. Correction on Germany: Nuclear accident costs *only* $ 720 millions so far.

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      2. if nuclear power had been allowed to thrive and be innovative in the early days the bugs would have been worked out years ago. instead we have pumped untold billions of tons of co2 thanks to the hysterics and propaganda produced by the anti nuke crowd. they scared away investors so research dwindled and sadly, nuclear power became the albatross it is today

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  3. This Dem/Obama proposal does very little to reduce emissions, but better something than nothing, which is what the Republicans want. Increasing renewable’s to a greater mix of the energy production can only do the US good, even if renewable’s can only cover some of our energy needs. My personal energy bills went from $240 a month when I bought the house to $45 after insulating, passive solar improvements, changing my 1976 heating system and getting solar water heater and PVC panels. Not perfect, but an awful lot better. Payback on the upfront costs: 7 years.

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  4. Dave Castro Tuesday, June 3, 2014

    This will increase the cost of energy, which is a terrible idea. It’s basically a new regressive tax on the poor and middle class. Climate stasis isn’t worth harming our economy and hurting people, not that this plan will actually deliver climate stasis.

    These schemes are violations of First Amendment protections of freedom of religion. Environmentalism is clearly a religion, and many of us don’t subscribe to it. I don’t subscribe to any religion, and I certainly don’t worship the earth, Gaia, Nature, or ecological stasis.

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    1. Which planet do you come from? Remember the 60s and 70s before the EPA cleaned up all the pollution. Pollution is a religion of which you are indeed a follower

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      1. I remember those days. Big V8 cars got 20+ mile to the gallon then all of a sudden that dropped to 7 to 8 mpg. The EPA caused the CO2 crisis if their is one. Probably the same it true for coal fired power plants. And now instead of driving your car you have to ride a bike or walk. The human being is the most inefficient transportation system there is.

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  5. It would help if Cleantech or others did a better job of depicting and documenting the cost decline record of solar, etc. by sub-segment of the industry. Currently, this cost profile information is limited to update reports from leading solar companies to analysts. Recent and projected cost reductions would help a lot of people and new investors visualize the changes that drive industry restructuring.

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  6. What this headline SHOULD say is “EPA’s new plan is a HUGE boon for Crony Capitalists and lobbyists who will now milk the system for all they can get, while raising old people’s electric bills to do it!”

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  7. As always there will be a few winners but the working stiffs as usual will be the losers. For those that don’t already know google ” Germany failed green” and find out how this is going for them.

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  8. This is just another EPA abomination which will increase the cost of energy dramatically, do NOTHING for the environment because you can’t change the climate and will result in even more job losses! The EPA needs to be disbanded NOW! They are a bunch of unelected bureaucrat THUGS who make up laws as they see fit!

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  9. Alert!!! Alert!!! Alert!!
    From Democrat Headquarters: All democrats and supporters here and abroad, we must flood the media with hysterical climate change & global warming alarms to take the heat off Dem candidates in the November 2014 and 2016 elections due to the train wreck of Obamacare! Shout, scream, cry, make outlandish claims and don’t stop till after the elections!!!
    Alert!!! Alert!!! Alert!!!

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  10. Did this writer research the “clean” energy disasters in Germany and Spain? So we are supposed to follow like zombies who can’t learn from ACTUAL experience, not romantic fantasy? Pitiful display of ignorance over truth.

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