Charts of the Week: What EPA’s Clean Power Plan Costs Visually Look Like

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In light of more than 20 states finally being able to lodge formal lawsuits against the EPA’s Clean Power Plan a month ago, the National Mining Association has commissioned Energy Ventures Analysis (EVA) to drill down into the costs of complying with the rule — for industrial users, commercial user and consumers alike.

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From a high level, EVA expects a “$214 billion increase in wholesale electricity prices, double-digit wholesale electricity price increases in 46 states, and $64 billion to replace lost power capacity serving 24 million homes.”

EPA Clean Power Plan Cost in Pictures

In a visual nutshell, here is what EVA projects the costs of the EPA Clean Power Plan to look like:

Source: Energy Ventures Analysis

Clearly, many of the hardest-to-be-hit states are also the most manufacturing-intensive. Source: Energy Ventures Analysis

US map of electricity prices under EPA CPP

Ouch for the Rust Belt. Source: Energy Ventures Analysis

US map compliance costs power capacity replacement

Source: Energy Ventures Analysis

What This Means for Industrial Manufacturers

According to EVA:

“The consequences for costs are evident in the looming price increases for electricity. EVA’s analysis projects that by 2030, when the CPP is fully implemented, the wholesale price for electricity will spike electricity prices nationwide by 21.2 percent above the non-CPP base case.

Commercial and industrial consumers of electricity will naturally experience the same price increases, which are likely to be passed on to consumers in increased prices for goods and services. Furthermore, the greater natural gas demand by the power sector will increase natural gas prices that will be felt beyond the power sector. Residential, commercial and industrial natural gas consumers’ bills would increase by $6-8 billion/year under the EPA Clean Power Plan to recover higher gas commodity purchase prices. In addition, if the industry requires additional investment in pipeline capacity to meet the power sector’s growing gas demand, these costs would also be passed onto consumers.”

Read the complete report for more context, analysis and, most importantly, EVA’s methodology.

And learn much more about EPA’s CPP and its potential costs to US manufacturers.

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