New La. regime eyes outreach on carbon plan amid stay

By Edward Klump | 02/22/2016 07:00 AM EST

Last November’s election of a new Louisiana governor has altered the state’s discussion around U.S. EPA’s Clean Power Plan, and a key official says he will explore carbon-cutting options despite a court stay.

Last November’s election of a new Louisiana governor has altered the state’s discussion around U.S. EPA’s Clean Power Plan, and a key official says he will explore carbon-cutting options despite a court stay.

Louisiana had been focused on litigation through its attorney general and the Louisiana Department of Environmental Quality (LDEQ), as both sued over the plan last year.

A different perspective arrived after voters chose John Bel Edwards, a Democrat, to replace Bobby Jindal, the two-term outgoing Republican governor. Edwards appointed Chuck Carr Brown as secretary of LDEQ in January.


Brown, in a recent interview, said his office is starting the process of meeting with utilities and public interest groups to examine a potential state plan, even as litigation continues. That was before word spread late on Feb. 9 that the U.S. Supreme Court had decided to freeze the EPA carbon plan, forcing states to reconsider their options. Still, Brown said in a statement last week, Louisiana plans to move forward on exploring the Clean Power Plan.

"We will reach out to all our stakeholders," Brown said. "We plan to hold at least one outreach meeting" in mid-March, he said.

Not everyone has the same focus.

Ruth Wisher, press secretary for Louisiana Attorney General Jeff Landry (R), said in a statement that "Louisiana needs to take no action to come into compliance" in light of the stay. Landry also was elected last year, though he defeated a fellow Republican.

"We are pleased that our request for a stay of EPA’s rule was granted by the Supreme Court," Wisher said, adding, "This was a victory for Louisiana, who could be on the hook for the billions it would cost to implement this rule."

Ark.’s approach

Louisiana’s two-track approach has similarities to planning by Arkansas officials. Arkansas, while in litigation, pursued a process to examine its options.

"We think that they’ve kind of got a good model," Brown said, adding that Louisiana could "help other states bridge the gap" with its natural gas resources and a possible trading program.

The Arkansas Department of Environmental Quality and Public Service Commission said they were pleased to learn of the stay.

"We look forward to engagement that can now occur on a timeline and in a context that makes sense and represents good stewardship of taxpayer resources for Arkansas, for our citizens, and for our regulated community," the agencies added in a Feb. 12 note.

They asked for input on several questions in light of the stay, including how to maximize resources already invested, whether a suspension of state activity would be required, how an obligation to provide a cost estimate for a strategy would be affected and how a stakeholder group might function.

EPA’s plan aims to cut carbon dioxide emissions at power plants 32 percent by 2030 compared with 2005 levels. Targets vary by state. The plan sought to give states until Sept. 6 to turn in a plan or make an extension request or face a potential federal plan. If a state got an extension, a progress report was to have been due by Sept. 6, 2017, with a final state plan needed by Sept. 6, 2018. That timing now is uncertain.

Before the stay, Brown spoke of looking at how Louisiana could benefit, noting its gas resources. He said renewable energy also could be explored. The LDEQ secretary said he was considering a mass-based approach that could incorporate trading, though discussions would continue.

Meanwhile, a filing this year at the Louisiana Public Service Commission (LPSC) shows plans to have a stakeholder process to examine state implementation issues related to the Clean Power Plan. But the document, signed by a staff attorney for the commission, stated that the process shouldn’t be seen as support for EPA’s rule.

Seeking engagement

The filing says: "The Commission has expressed, and continues to express, significant concerns about the CPP and its impact on Louisiana ratepayers." If the process moves ahead, LPSC staff could take a proposal to the commission for a vote, which would be sent to LDEQ as a recommendation.

A number of comments were previously posted in an LPSC docket. In September, for example, the Louisiana Energy Users Group questioned the legality of the rule and raised issues in areas such as power prices and reliability. But it also said LPSC should be involved if a state implementation plan were going to be considered.

Casey DeMoss, CEO of the New Orleans-based Alliance for Affordable Energy, said last year that Louisiana had reason to support global efforts to cut CO2 emissions given its vulnerability. She saw the Clean Power Plan as a start down the right path.

In a recent interview, DeMoss said that "it’s our understanding that the governor is serious about the environment and climate change" and that Louisiana could have a state implementation plan. She said the state should move ahead despite the stay.

New Orleans-based Entergy Corp., a power company with interests in Louisiana and other states, expressed concern about the legality of EPA’s approach last year.

It also said it would be looking at the compliance timeline, the requirements for each state, a state’s ability to select a mass-based approach and create a trading-ready plan, and the possible effects on customers as well as the U.S. nuclear fleet.

Entergy Chief Financial Officer Drew Marsh, in an interview last week, said his company would like parties to stay engaged. Although Entergy sought a legal review of the Clean Power Plan, Marsh said the company has been an advocate for clean air for years.

While Marsh said investments tied to a carbon plan could help business in some ways, he said customers’ interests regarding rates and the environment also need to be considered.

"We are trying to work with all our stakeholders, including the states, so that they can make the best decision for the state," Marsh said.