July 1, 2015

Whitfield Cites Debunked Clean Power Plan Electric Prices Study

NERA report raises concerns with misleading research

In the run up and aftermath of the House vote on HR 2042 on June 24, Representative Ed Whitfield (R-KY) cited misleading claims from a debunked NERA Economic Consulting report about electricity prices under the Environmental Protection Agency’s (EPA) Clean Power Plan. This inaccurate information permeated the broader debate about HR 2042, a bill sponsored by Whitfield that would set a dangerous precedent by allowing states to opt out of complying with the nation’s first-ever limits on power plant carbon emissions, and unfortunately made its way into Associated Press coverage. More information is provided below:

“A recent analysis of the proposed rule’s impacts on electricity prices in 31 states estimated that between 2017 and 2031, ‘Electricity prices will be 15 percent higher, on average, each year under the Clean Power Plan than they would be without the Clean Power Plan.’”

The Washington Post (WAPO) Fact Checker found similar claims that “electricity prices will increase by double digits” made by Senator James Inhofe and based on the NERA report to be “misleading.”

  • WAPO cited concerns that NERA offered overly pessimistic assumptions about the costs of energy efficiency in order to artificially inflate the costs of the Clean Power Plan. Similar concerns were raised by the Union of Concerned Scientists and Natural Resource Defense Council, among others.
  • The EPA’s own Regulatory Impact Analysis found that under the Clean Power Plan electricity bills will increase slightly in 2020, but that investments in energy efficiency will pay off and generate savings on electricity bills in 2025 and 2030.
  • The Energy Information Administration (EIA) also found that higher electricity prices do not necessarily translate into higher electricity bills, and that electricity bills will increase by a lower percentage than electricity prices under the Clean Power Plan, “because customers are using less electricity.” 
  • A recent review of energy efficiency programs in 23 states found such programs regularly save utility customers $2 for every $1 invested.
  • WAPO also correctly found the NERA estimates Inhofe cited to be “on the high end of a range of cost impacts, which are mere projections at this point.”

Notably, Whitfield’s home state of Kentucky is already on track to exceed the EPA’s 2020 benchmarks for limiting carbon emissions due to existing decisions to retire old, dirty and uneconomical power plants, according to analysis by the Union of Concerned Scientists.