The plant and related infrastructure has an $11 million annual payroll and is the biggest property taxpayer in Floyd County, responsible for 10 percent of the tax revenue.
“It would be a huge blow to the community to lose that plant,” Kevin Payne, the county tax commissioner, said.
Power customers, too, are worried about the EPA’s plan.
“We don’t like it,” said Ned Cochrane, vice president of Mauldin, South Carolina-based Mount Vernon Mills Inc., which operates a mill in Trion, on the Alabama border. The mill, which sells fabric to garment manufacturers in Mexico and Central America, is one of the largest consumers of electricity in northwest Georgia, and needs power prices to stay low in order to be competitive, Cochrane said.
“They put out all these predictions, but nobody really knows what the cost is going to be,” he said in an interview. “It’s going to hurt manufacturing in Georgia, and residential and commercial consumers as well.”
The rules endanger a resurgence of manufacturing in Georgia that has brought the state more than $1 billion in investment and 16,000 jobs, said Roy Bowen, president of the Georgia Association of Manufacturers. The expansion includes a Caterpillar Inc. plant in Athens and expansions at Shaw Industries Group Inc. and Mohawk Industries Inc. textile factories in North Georgia.
It’s all “driven by the advantage that we are seeing come to us in terms of energy prices,” Bowen said.
Cutting down on coal will mean greater reliance on natural gas for power, and gas prices have been volatile. With increased demand for gas by manufacturers, power producers and possibly exporters, any advantage they see now could be squandered if prices spike, Bowen said.
Another plant that regulators should look to shutter, according to Bailey, the environmental lawyer, is the McIntosh coal plant near Savannah. McIntosh, which has 58 full-time employees, didn’t run its coal unit at all in 2012, and ran only a few hours in 2013, she said. It doesn’t have modern pollution controls. Still, the plant provides a crucial power reserve, running during the winter cold spell and already this summer, Kraft said.
“The rumor mill says more of the coal plants are going to close, more than they are already doing,” said Jay Brazell, president of the local chapter of the International Brotherhood of Electrical Workers in Savannah, which represents contract employees at the plant. “I think it’s awful.”
The story there is more nuanced: an adjacent natural-gas plant is one of the state’s biggest power producers; and it could thrive with the climate rules.
“For carbon reduction, there would be additional incentive to run the gas plant over the coal plant,” Georgia Tech’s Shelton said.
According to EPA’s technical documents, Georgia’s coal and natural gas units combined for a rate of 1,500 pounds of carbon per megawatt hour in 2012, and it must cut to 834 pounds. Its coal plants could run 6 percent more efficiently, and its gas plants only ran about half the time in 2012, the base year EPA used to calculate reduction mandates.
The EPA determined that the gas plants could run 70 percent of the time. If that happened, coal use in the state would fall by about 34 percent, and natural gas use would jump about the same, the agency forecast.
The EPA calculated Georgia could make greater use of renewable energy and efficiency-boosting measures, though the combination accounts for less of a change than the boost in natural gas. In part that’s because the EPA grouped Georgia with other Southeast states where the use of renewable energy is less common than those in the Midwest and West.
The biggest reduction in Georgia, however, will come because Southern and its partners are building two new nuclear units, each 1,117 megawatts, at Plant Vogtle, about 26 miles (42 kilometers) southeast of Augusta. The EPA assumed that zero- carbon electricity into the cut required of Georgia. In fact, it alone accounts for more than a third of Georgia’s required reductions.
And then there’s solar, which Southern Chief Executive Officer Tom Fanning has identified as a growth opportunity for his company.
Under pressure from its public service commission, Georgia Power instituted two separate programs to boost solar generation in the state. In July last year, the commission approved a 525-megawatt capacity expansion, at rates that the company says won’t increase power bills for retail users.
The company had to be prodded into its embrace of solar, said Lauren “Bubba” McDonald, a member of the Georgia Public Service Commission who pressed hardest for the solar adoption.
“They should be happy,” McDonald said. “I’ve heard it said the utilities that haven’t made these kinds of moves are going to be in trouble.”
Whether Georgia Power is happy or not, solar installer Smith is. Ever since the EPA rule came out, and Georgia Power told customers their bills could rise, Smith said potential clients have been calling him for price quotes at least twice a day, up from about twice a week.
As he drove off to do a consultation with another homeowner, Smith forecast that tapping the sun for electricity will accomplish one thing that coal cannot.
“Solar will create more jobs than coal ever thought about doing,” he said.
Copyright 2014 Bloomberg
Lead image: Georgia sign via Shutterstock