FAIRBANKS—The head of the Golden Valley Electric Association said the Obama administration's proposed rules to slash power plant emissions will likely lead to increased rates.
GVEA CEO Cory Borgeson said that any regulation on power plants can lead to higher rates, but he said he's hopeful the Environmental Protection Agency's new rules will be beneficial for health and the environment.
"We've had many conference calls today, and we're trying to get our hands around the regulations and how they will impact us. To the extent that there's regulations of us as an industry, there will be additional costs. But I don't know if we fear additional costs for environmental regulation as long as it's tied to a reasonable benefit."
The regulations call for a 30 percent reduction across the country in emissions from power plants. Because the regulations vary by state, they call for a reduction of 26 percent in Alaska.
Borgeson said the electricity co-operative is already exploring new technologies that will capture greater amounts of greenhouse gasses from its power plants. He said reducing emissions is a worthy goal, comparing it to safety measures in a car.
"If we could produce cars without seat belts, airbags or anti-lock breaks, you could probably save a couple thousand dollars off the price of your car, but would you really want to buy a car like that?" he said.
Borgeson said GVEA is still reviewing the proposed measures to determine whether or not they achieve the desired goal. GVEA spokeswoman Corinne Bradish said GVEA will be working closely with the state and other utilities to analyze the plan.
"The rule will impact GVEA, but at this time it is premature to know the full impact," she said. "We will be working with the Alaska Department of Environmental Conservation and other utilities in the state to forge a plan forward that meets the requirements of the final rule."
Borgeson said he believes there will likely be "significant litigation" over the regulations by special interest groups but that GVEA, at this time, does not anticipate actively participating in any lawsuit.
The new regulations also come as the University of Alaska Fairbanks sets out to build a new coal plant to provide heat and power for its campus. UAF spokeswoman Marmian Grimes said the university is also reviewing the regulations but believes that it won't affect the plant.
"We'll need to review the regulations more carefully, as we haven't had a chance to do so with the most current version," she said via email. "However, from what we understand of earlier versions, the regulations will not likely apply to the UAF heat and power plant, as we are not considered a utility, do not sell power and are a very small facility."
The regulations would require the reduction to take place over the next 15 years. The regulations will be up for a 120-day public comment period once they are published in the Federal Register.
Contact staff writer Matt Buxton at 459-7544. Follow him on Twitter: @FDNMpolitics.