STATES

A Q&A with an official who hopes to be among the first to comply with the Clean Power Plan

John Quigley is secretary of the Pennsylvania Department of Environmental Protection. Under Gov. Tom Wolf (D), Quigley will craft Pennsylvania's compliance path for the Obama administration's Clean Power Plan, a sweeping regulation to reduce U.S. carbon emissions from the power sector 32 percent from 2005 levels by 2030.

Under the Clean Power Plan, U.S. EPA is requiring Pennsylvania to lower its emissions rate from power plants by 33 percent from 2005 levels by 2030. Pennsylvania's plan will have repercussions beyond the state's borders. It is the top electricity exporter in the United States, according to DEP, and also is a major producer of both coal and natural gas.

Complying with the Clean Power Plan will also present political hurdles for Quigley; Act 175 of 2014, signed into law by then-Gov. Tom Corbett (R), requires DEP to submit its state plan to the now Republican-led General Assembly for a vote before turning it in to EPA (Greenwire, Oct. 16, 2014).

Nevertheless, the Wolf administration aims to submit a final plan to EPA in September 2016 rather than seeking a two-year extension, a course many other states are expected to take. DEP recently completed a series of 14 listening sessions that, in addition to a public comment period, allowed the agency to hear how Pennsylvanians want the agency to approach EPA's climate rule. Quigley says DEP is now writing a first draft of its plan. He spoke with ClimateWire about the challenges -- and opportunities -- Clean Power Plan compliance presents for his state. This conversation has been edited slightly for length and clarity.

ClimateWire: You have said one of the big challenges for Pennsylvania in writing its state plan is maintaining its status as a net energy exporter. Why is that a challenge, and what are the consequences if Pennsylvania loses this status?

Quigley: The energy sector is a very important sector in Pennsylvania's economy. There are a lot of folks in Pennsylvania employed in the generation of electricity; Pennsylvania is the No. 1 energy-exporting state in the United States. ... Governor Wolf has tasked us to maintain that position as an energy exporter while meeting the requirements of the Clean Power Plan. So it's an additional hurdle, basically, that we have to get over, but I'm confident that we'll be able to do that.

CW: Looking over the comments the Pennsylvania DEP has received, it looks like many energy companies are pushing for mass-based carbon trading as a compliance option. Is that consistent with what you are seeing? Do you see any advantages in that approach?

Quigley: We haven't made any decisions yet. Certainly, in the course of the listening sessions and looking at the volume of comments, we heard a significant amount of support for mass-based [trading]. It is easier, relatively speaking, to administer. It could be less costly overall and could facilitate interstate trading. So it has a number of attributes that lend itself to consideration. We have to do some sophisticated modeling and make sure that is the right course for Pennsylvania.

CW: Pennsylvania's coal industry is urging DEP to delay the submittal of its state plan until 2018. Can you bring them on board with your desire to submit a plan in 2016?

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Quigley: We heard very significant comments from the generating community urging us to submit a plan in September [2016]. The argument there was, "We want business certainty. The sooner we know what the rules of the road are, the longer we will have to plan for the implementation of those rules." So there are compelling arguments on all sides of this. It's not to say that anybody has a monopoly on the best argument. We have to take into account all of the input we received and try to balance it. Certainly, the governor wants us to maintain a role for coal in our future energy mix. We are looking at ways that we will be able to do that. In addition, looking at how we can perhaps become a leader in developing some of the technologies that will be needed in the longer term -- things like carbon capture and storage, carbon capture and utilization. At the end of the day, it's a balance.

CW: Could submitting a state plan to EPA next September be an advantage because Pennsylvania would therefore likely influence which carbon trading system -- either mass-based or rate-based -- other states would choose to participate in?

Quigley: There are incentives for states to really take out a leadership position, and clearly, because of Pennsylvania's footprint in the energy world, being the nation's No. 1 energy-exporting state, we certainly have some influence. There's an opportunity on multiple levels for us to lead and ultimately, I think, to demonstrate sustainability to the nation.

CW: Do you anticipate any political efforts, like in Pennsylvania's Republican-led General Assembly, to try to prevent you from submitting a plan in the time frame you're contemplating?

Quigley: It's our intention to share a draft plan with the General Assembly well in advance of submission to EPA. We will do this open-book. The options are, does Pennsylvania want a plan handed to us by EPA? Or do we want a plan that is developed for Pennsylvania, by Pennsylvanians? I think the work will speak for itself and we will prepare a plan that is compelling, that shows how we can maintain the state's energy economy -- indeed, grow our economy -- and cut our emissions at the same time.

CW: Are there any unknowns that present a challenge when it comes to writing a plan? For example, some critics have said that because Pennsylvania doesn't know what EPA's federal plan will look like because it hasn't yet been finalized, the state should wait to file its plan until 2018.

Quigley: There are variables that we have to pay attention to. Another one, for example, is that PJM Interconnection's modeling of the final rule might not be available until the summer of next year. We would be on track to have a plan drafted by Memorial Day. So we have to look at that timing and determine whether or not any of those variables requires us to adjust our timing and our goal. The goal is to submit a final plan that is not an absolute; we're going to have to respond to some of these conditions and information as it develops. But we intend to stay on track to shoot for final submission in September.

CW: The Pennsylvania Public Utility Commission noted in its comments to DEP, "the successful compliance with [Clean Power Plan] requirements within the PJM region may largely depend on the survival of the existing nuclear fleet." Is there anything Pennsylvania might do to ensure nuclear energy's role is maintained?

Quigley: We think there is, at least, as strong argument to be made that the effect of this rule will provide some incentives to nuclear power. It is an important part of our energy generation in Pennsylvania; about 36 percent of electricity generated in Pennsylvania comes from nuclear power. We are the No. 2 nuclear power state in the nation. And nuclear power, in fact, represents about 95 percent of the carbon-free generation in Pennsylvania. So it's a huge asset to the commonwealth, as well as being a significant employer, and we need to figure out how to preserve that.

CW: Are you seeing interest in EPA's Clean Energy Incentive Program (CEIP), which provides early credit to wind, solar and energy efficiency built before the Clean Power Plan compliance period begins? Is that something Pennsylvania is considering?

Quigley: Yes. When you look at the comments that we received in the course of our 14 listening sessions, there was very strong support for the CEIP, for energy efficiency and renewable energy, generally -- in fact, I'd say overwhelming support. We're trying to see, as that plan still comes into focus, what is the appropriate role for both of those tools. Clearly, the cleanest megawatt-hour is the one you don't have to generate. And I think there's a lot of juice left to be squeezed out of our Act 129 -- Pennsylvania's energy-efficiency law.

We will come up with a plan that resides within the four squares of the Clean Power Plan, but we're very likely also to come out with a companion document of the "should-do's" that aren't necessarily needed for compliance, but are things Pennsylvania should do as a matter of good public policy: to grow the renewable energy economy, to advance the cause of energy efficiency.

Reporter Rod Kuckro contributed.

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