Cap and Trade Tax Threatens New Power Plant Development

By Bob Ellis on June 25th, 2009

PIERRE – The US House of Representatives is scheduled to vote tomorrow on Federal

legislation designed to cut greenhouse gas emissions by increasing taxes on carbon dioxide

emissions from fossil fuel sources – oil, coal, and natural gas. The legislation, which is 1201

pages, is directly threatening the development of the NextGen coal-based power plant planned

for construction near Selby, SD. Basin Electric, who voted in February 2008 to select the Selby

site, is currently re-evaluating its timeline for development of the plant due to uncertainty on

carbon emissions and renewable and energy efficiency standards and regulations. These

regulations will be included in the climate change legislation being pushed by House Speaker

Nancy Pelosi and Congresswoman Stephanie Herseth Sandlin.

The legislation, dubbed “cap and trade,” is a new tax designed to make energy produced from

coal and gas more expensive. Estimates from a South Dakota Public Utilities Commission study

have shown that under cap and trade, residential electric bills in South Dakota would increase

more than 48 percent. All South Dakotans would pay this tax, averaging $3100 per year.

The legislation also forces new regulatory requirements on energy providers. Providers will

have to update their facilities to conform to the new Environmental Protection Agency (EPA)

requirements to operate under the emissions cap. However, since Congress has failed to clearly

detail what the new requirements will be, energy providers like Basin Electric are unable to

proceed with a reasonable level of certainty that their new plant will meet the new EPA

requirements.

State Senator Corey Brown (R-Gettysburg), whose legislative district includes Selby and the

location of the planned NextGen plant, is very concerned by the lack of leadership from

Congress. “At nearly $4 billion, the NextGen plant is one of the largest economic development

opportunities our state has had in decades,” he said. “It is unfortunate that people representing

South Dakota would promote positions that threaten an issue that is so important.”Fdddd

From today’s mailbox:

FOR IMMEDIATE RELEASE
CONTACT: Lucas Lentsch 605-224-7347

PIERRE – The US House of Representatives is scheduled to vote tomorrow on Federal legislation designed to cut greenhouse gas emissions by increasing taxes on carbon dioxide emissions from fossil fuel sources – oil, coal, and natural gas. The legislation, which is 1201 pages, is directly threatening the development of the NextGen coal-based power plant planned for construction near Selby, SD. Basin Electric, who voted in February 2008 to select the Selby site, is currently re-evaluating its timeline for development of the plant due to uncertainty on carbon emissions and renewable and energy efficiency standards and regulations. These regulations will be included in the climate change legislation being pushed by House Speaker Nancy Pelosi and Congresswoman Stephanie Herseth Sandlin.

The legislation, dubbed “cap and trade,” is a new tax designed to make energy produced from coal and gas more expensive. Estimates from a South Dakota Public Utilities Commission study have shown that under cap and trade, residential electric bills in South Dakota would increase more than 48 percent. All South Dakotans would pay this tax, averaging $3100 per year.

The legislation also forces new regulatory requirements on energy providers. Providers will have to update their facilities to conform to the new Environmental Protection Agency (EPA) requirements to operate under the emissions cap. However, since Congress has failed to clearly detail what the new requirements will be, energy providers like Basin Electric are unable to proceed with a reasonable level of certainty that their new plant will meet the new EPA requirements.

State Senator Corey Brown (R-Gettysburg), whose legislative district includes Selby and the location of the planned NextGen plant, is very concerned by the lack of leadership from Congress. “At nearly $4 billion, the NextGen plant is one of the largest economic development opportunities our state has had in decades,” he said. “It is unfortunate that people representing South Dakota would promote positions that threaten an issue that is so important.”

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