September 29, 2020 - The Federal Energy Regulatory Commission (FERC) has announced a Technical Conference to be held on September 30, 2020 to discuss considerations related to state adoption of mechanisms to price carbon dioxide emissions, commonly referred to as carbon pricing, in organized electricity markets.

The “Saving US Coal Team” in conjunction with the Center for the Study of Carbon Dioxide and Global Change fully recognizes this massive threat to the coal industry and has responded to FERC by submitting a filing in opposition to FERC adopting “a price on carbon”. The text of the document follows which includes attachments:

Submission in Docket No. AD20-14-000, September 28, 2020

Frederick D. Palmer, Esq.

Senior Fellow, CO2 Policy,

Center for the Study of Carbon Dioxide and Global Change,

www.co2science.org

To the Federal Energy Regulatory Commission (FERC), this is a submission with attachments in opposition to FERC adopting “a price on carbon”:

Fred Palmer

In the above docket, FERC is exploring the “general legal issues” that may arise under the Federal Power Act if the Commission considers adoption of a “price on carbon” where a  state singularly or in concert with other states sets an explicit carbon price and how that price intersects with RTO/ISO-administered markets. Should FERC allow the RTO/ISO to impose such a price in the relevant market, a negative rate value would result first for coal plants, then natural gas, promoting wind and solar and accelerating the closure of more coal plants to zero over time. At the same time, the risk profile for nationally higher electricity rates and reliability risks would increase, maybe dramatically so, through current trends in states like California and increased natural gas prices as accelerating NG production declines continue, or even accelerate. 

The Commission is well aware of its mission to ensure jurisdictional electricity rates are reasonable, and neither discriminatory nor preferential. If proposed rates and terms of service do not meet these criteria, they are unlawful no matter the business reasons advanced by a state, jurisdictional entity or utility. 

Before proceeding to seriously consider a carbon tax as a part of jurisdictional rates, it is submitted that the Commission needs to first examine de novo the science justification and environmental impact for various states adopting a carbon tax, no matter its structure. The reality is that none of the states are regulating CO2 to avoid specific environmental impact or harm to their citizens from coal or natural gas plant CO2 emissions in any of the states. Nor could it be otherwise as CO2 is generated by people and the earth in real time everywhere all the time. CO2 is a benign gas required for all life on earth, humans, animals and the biosphere itself. Such an examination by FERC will show no environmental benefits locally or globally from limiting CO2 emissions, only higher electric rates and increasing reliability risk locally.

As stated, CO2 emissions are world-wide and a 100% removal of all CO2 emissions in the US would have no climate impact in any state of the United States under the global theory of catastrophic global warming advanced by environmental and business proponents of a carbon tax. The US and EU combined are just over 10% of total world population at a little over 800 million people. China and India combined approach 3 billion people and are building new coal and natural gas plants as we consider these issues before FERC. Neither country has any plans to reverse course for decades and oil use will follow electricity use. 

Too, China is a leading development partner in Africa with 1.3 billion people and in the Asian countries of 600 million people. Both African and Asian countries are building coal plants and will use ever more heavy oil as they urbanize and develop. 

For our individual states and the United States, a reminder of the saying used in the 1990s in successful resistance to the US Senate ratifying the so-called Kyoto Protocol, “It’s not global and it won’t work”. That saying applies to each and every state that purports to “do something” about climate change no matter their motives and intentions, even as electric rates for ordinary people increase and accelerate to punitive levels. And California is Exhibit A, again. 

Assuming these carbon tax state actions are legal under each state constitution and the US Constitution, which has never been litigated, this reality doesn’t make it binding on this Commission in any way, shape or form. To the contrary, the Commission must first identify where its jurisdiction comes from to impose a phantom cost through a carbon tax on coal and natural gas plants. And assuming such jurisdiction, which at the moment is opaque to the undersigned, the Commission must determine if the resulting rate is just and reasonable, non-discriminatory, beneficial to the environment and people and effective in carrying out the overarching rational of the Federal Power Act creation of FERC. Which is the “Regulation and Development of Power”. 

Many in society, business and industrial interest groups in Washington DC have abandoned any meaningful scientific resistance to imposition of the anti-fossil fuels, cap tax or eliminate CO2 emissions agenda, as we proceed down a path to eliminate fossil fuel use entirely, a very troubling proposition but a very real one. This reality notwithstanding, there remains very serious disagreement in the scientific community with respect to the conventional wisdom of a looming climate apocalypse continually pushed by the media and through robust commercial and environmental advertising. But the Commission must be impervious to all of this, as statutory mandates are in place against unreasonable rates through a phantom tax on a benign gas and discrimination against coal and natural gas-generating sources operating in interstate commerce meeting all state and federal rules and regulations. 

Our recommendation then is that FERC table this proposal and do nothing. In support of the recommendation, we advance the concept that using fossil fuels generally and coal for electricity generation specifically, are a positive good both from a people standpoint and from a CO2 emissions standpoint. In support of that proposition, we submit a 2014 study by the American Coalition for Clean Coal Electricity in connection with a President Obama initiative in setting a “social cost of carbon”. The study is very powerful in showing why the concept is pernicious on its face. The study’s demonstration of the absolute and obvious benefits to people, society, agriculture and the biosphere from coal, oil and natural gas use and resulting CO2 emissions are a complete answer to any attempt to tax and then eliminate fossil fuel use now or at any point in our future. 

And the study is even more pertinent today than it was when issued as the passage of 6 years shows through observation how correct the thesis was and is. From 2104 to today, more  people are living longer and better, we use more fossil fuels, economic growth (pre pandemic) has been very strong, agriculture production sets record production levels, atmospheric CO2 content is greater, per NOAA satellite pictures the earth is greener and warming remains modest as shown by satellite temperature records found at drroyspencer.com.

At the CO2 Center, we believe all governments have the obligation to pursue policies that allow more people to live longer and live better. We also believe that observations, not flawed, flux adjusted computer models, should inform energy and environmental policy, particularly when it comes to CO2 emissions. Applying these principles, we conclude that fossil fuels, led by coal, should remain our foundational source of energy.

See also CoalZoom's Saving US Coal section, for further discussion of CO2.

With respect and gratitude for the opportunity to be heard. 

Fred Palmer