Forging Ahead with Clean Power Plan Compliance Would Benefit Illinois

, policy analyst, Clean Energy | February 24, 2016, 8:55 am EST
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Illinois’ Governor Bruce Rauner has not confirmed whether Illinois will move forward with a Clean Power Plan (CPP) planning process following the Supreme Court’s decision on February 9 to stay the rule while legal challenges are sorted out. Yet, 16 states have already wisely stated they will continue to plan for compliance with the rule, and Illinois should follow suit. New analysis by the Union of Concerned Scientists shows that strengthening Illinois’s clean energy policies, along with participating in a national carbon emissions-trading program, would provide a cost-effective way for the state to spur economic growth, cut carbon emissions, and comply with the CPP.

Photo: tlindenbaum/Flickr

Illinois has tremendous clean energy potential. Photo: tlindenbaum/Flickr

Illinois is well positioned to be a low-carbon leader

Given its current transition from coal generation and its growing investments in renewable energy and energy efficiency, Illinois is already very well positioned to meet its CPP emission reduction targets. Staying the course towards a clean energy future will not only help cut global warming emissions but will also reap significant health and economic benefits for all Illinois residents.

The UCS analysis found that participation in a national carbon emissions trading program, along with fixing and strengthening the state’s energy efficiency portfolio standard (EEPS) and renewable energy portfolio standard (RPS) through the Illinois Clean Jobs Bill, are key strategies to comply with the Clean Power Plan and would:

  • Yield nearly 6,000 megawatts (MW) of new wind and solar capacity in Illinois by 2030, which could stimulate $6.3 billion in new capital investments
  • Save consumers more than $2.6 billion cumulatively through 2030 from reduced fuel and other costs due to the state’s renewable energy and energy efficiency policies
  • Reduce the typical Illinois household’s electricity costs by 9.4 percent in 2030, an annual savings of $100
  • Generate $603 million in average annual revenue from 2022 to 2030 from the sale of carbon allowances that could be reinvested to benefit all Illinois residents
  • Provide health and economic benefits through 2030 – by decreasing CO2, SO2 and NOx pollution, worth some $14.3 billion cumulatively

The Clean Power Plan

The CPP was finalized in August 2015 and resulted in the U.S. Environmental Protection Agency (EPA) setting the nation’s first-ever limits on carbon dioxide (CO2) emissions from power plants. The CPP establishes state-by state targets for carbon emissions reductions, and offers a flexible framework under which states can meet those targets. The CPP is a climate game changer because it would reduce national electricity sector emissions by an estimated 32 percent below 2005 levels by 2030. The target for reducing emissions in Illinois is 35 million tons, or 34 percent below 2012 levels, by 2030.

Unfortunately, on February 9, the Supreme Court placed a hold on the Clean Power Plan, which will stay in place until a lower court rules on the merits and the Supreme Court either refuses to hear the case or rules on the merits. This hold could last for 18 months or more, depending upon how quickly the appellate process proceeds. However, nothing prevents states from moving forward in the development of their compliance plans or continuing to invest in clean energy sources such as wind, solar, and energy efficiency.

Unlocking Illinois’ Clean Energy Potential

One of the primary drivers of wind and solar development in Illinois has been the state’s RPS. The standard was established in 2007 and requires investor-owned utilities to supply 25 percent of their electricity from renewable energy resources by 2025. But progress toward meeting the RPS has been hampered by flaws in the policy, including the inability of utilities to engage in long-term planning for energy resource developments. As a result, renewable energy development has disappointingly stalled in Illinois while it continues to flourish in the rest of the region and around the country.

Similarly, the EEPS has also encountered implementation barriers. Illinois utilities have fallen short of the mandated energy savings targets because state law limits utility spending on measures that will reduce energy consumption.

Fortunately, Illinois can get back on track by moving forward with a process to develop a strong CPP compliance plan that prioritizes renewable energy and energy efficiency. The Illinois Environmental Protection Agency (IEPA) should develop a strong mass-based CPP compliance plan that includes new sources, auctioning of allowances, and trading with other states.

The IEPA should also conduct a comprehensive and inclusive stakeholder process, that includes robust listening sessions throughout the state. This effort should be combined with fixing and strengthening the RPS to achieve renewable generation of 35 percent by 2030, and strengthening the EEPS to reduce electricity demand by 20 percent in 2025, as outlined in the Illinois Clean Jobs Bill.

Speak up for clean energy

Governor Rauner should follow the lead of governors from other states who have announced they will move forward with crafting their state’s compliance plans. This will ensure Illinois maintains its strong momentum transitioning to low-carbon energy while waiting for the Clean Power Plan to be legally resolved.

Tell Governor Rauner to Power Ahead on the Clean Power Plan.

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