Clearing the Haze Could Mean Rate Hikes for Electric Bills

By Alex Cameron, Oklahoma Impact Team

OKLAHOMA CITY -- Just a couple of months ago, it wasn't looking good -- for our electric bills, anyway. Oklahoma's two biggest providers of electricity were talking about significant rate increases. One of them, in fact, was talking about a record-setting increase.

That sort of talk has generally faded away, although, until the Environmental Protection Agency weighs in, it can't go away completely.

What does the EPA have to do with what your electric bill? Well, possibly, a lot.

Eleven years ago, as part of the federal Clean Air Act, the EPA promulgated what's known as the Regional Haze rule. The rule requires that each state comes up with a State Implementation Plan (SIP) to reduce the emissions that cause haze.

The goal -- and it certainly qualifies as "long-term" -- is to restore the visibility at the nation's 156 class 1 wilderness areas to "natural conditions" by the year 2064.

In Oklahoma, there is one such wilderness area: the Wichita Mountain Wildlife Refuge, near Lawton.

The Refuge is home to enormous and striking beauty. Massive bolders and rocky outcroppings mark one of the oldest geologic formations on earth. Buffalo and elk roam the refuge's sweeping tall-grass prairie.

Sadly, on some days, it can be difficult to see it all clearly -- because of the haze.

"There are days where the wind is down and perhaps a storm front has cleared the air out and you can see for a hundred miles from up here," said local resident Bill Cunningham, standing atop Mount Scott, the refuge's highest point. "Not today."

Cunningham and his wife, Maryruth Prose, have been hiking in the Wichita Mountains for 35 years. They get their exercise there, but also something more.

"It really changes you out here," Cunningham said. "It's a spiritual experience, it's renewal."

But he said, more and more, the experience is being diminished by pollution.

"Today's a hazy day, and you wonder why," Cunningham said.

Two hundred miles to the north, near Ponca City, sits OG&E's Sooner Power Plant. It is one of four coal-fired power plants in Oklahoma that state environmental officials determined to be the state's major contributors to haze. They, thus, became the focus of the state's Regional Haze plan.

"Regional haze is an artifact of air emissions, particularly sulfur emissions," said Steve Thompson, Executive Director of the Department of Environmental Quality.

Even though Sooner and the other plants burn only low-sulfur coal, Thompson and DEQ were preparing to submit a SIP to the EPA early this year that would have required OG&E and AEP-PSO, which owns the other plants, to install extremely expensive sulfur scrubbers on their coal units.

At a December 2009 public hearing on the plan, OG&E officials formally came out in opposition to the SIP, but put their opposition in language they hoped everyone would understand.

"The proposal will result in the single largest rate increase for our customers in the company's 108-year history," said  Paul Renfrow, OG&E's Vice President for Public Affairs.

While AEP-PSO was been looking at about a $700 million outlay for two scrubbers, OG&E was staring at an expense of more than a $1 billion for four scrubbers -- an expense that utility officials said most likely would have been passed through to ratepayers.

"The impact of adding the scrubbers could have been as much as a 20 percent increase on the average residential bill," said OG&E spokesman Brian Alford.

The state quickly regrouped and, with the utilities' help, submitted a far less expensive plan. It relies on the continued use of low-sulfur coal and increased use of natural gas to achieve the EPA's desired emissions reductions. If the EPA rejects that plan, they included an alternative that involves half as many scrubbers.

Read the state's State Implementation Plan submitted to the EPA last month.

"So we tried to build a belt and suspenders into this thing for EPA to consider," Thompson said.

Still, all agreed that whatever plan the EPA eventually approves for reducing Oklahoma's haze-producing emissions, there will be a cost, and EPA officials feel it will be justified.

"We think that it is an investment in health, as well as, in being able to enjoy the national parks," said Carl Edlund, director of the EPA Region VI Air Division.

And Cunningham said he couldn't agree more.

"I take a firm stance that too often we place our short-term economic prosperity ahead of our long-term quality of life. It's that simple, when are we ever gonna wake up?" Cunningham said.

Oklahoma environmental officials submitted their SIP two weeks ago. The EPA will consider it and announce whether they accept or reject it in May 2011. If they reject it, they could implement their own plan, requiring scrubbers on all units, and that record rate hike might again be part of the conversation.