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Perspective On Growing EPA Environmental Mandates

Perspective On Growing EPA Environmental Mandates. David Stippler, Indiana Utility Consumer Counselor 2012 NASUCA Annual Meeting Baltimore, Maryland November 11, 2012. 1-888-441-2494 www.IN.gov/OUCC. Challenges Ahead: Growing Federal Mandates. Environmental

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Perspective On Growing EPA Environmental Mandates

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  1. Perspective On Growing EPA Environmental Mandates David Stippler, Indiana Utility Consumer Counselor 2012 NASUCA Annual Meeting Baltimore, Maryland November 11, 2012 1-888-441-2494 www.IN.gov/OUCC

  2. Challenges Ahead:Growing Federal Mandates • Environmental • Mercury and Air Toxic Standards (MATS) Rule (finalized December 21, 2012) • Cross-State Air Pollution Rule (CSAPR) (vacated by D.C. Circuit decision on August 21, 2012) • Proposed Cooling Water Intake Structures Rule-Sec.316(b) of Clean Water Act (published April 20, 2011) • Coal Combustion Residuals Rule (CCR) (late 2012-expected final rule date) • Proposed Greenhouse Gas (GHG) New Source Performance Standards (published April, 2012)

  3. Compliance Costs and Consequences • Late last year the SUFG (Purdue University) projected electricity prices to increase 20% by 2017. • SUFG then estimated earlier this year that electricity would rise another 14% due to EPA regulations over the next decade.

  4. Compliance Costs and Consequences • The SUFG’s estimates portend a significant rise in electricity prices for Indiana consumers in the near future. • Coupling the estimate as to the impact of EPA regulations with its construction cost estimates would equate to an increased residential monthly bill of about $146/month for 1,000 kWhs of consumption or about another $444/year for electricity.

  5. Compliance Costs and Consequences • Recent estimates by the Indiana Energy Association (IEA) for Indiana’s 5 largest IOUs to comply with mandates may exceed $11.5B. • Impact of capital costs on revenue requirements on Indiana alone will be in range of $1.5B annually. • An overall rate increase of about 22 per cent over time, when compared to the combined 2010 operating revenues of these 5 utilities.

  6. Challenges Ahead • Cost estimates-CPCN requests • OUCC’s ongoing concern over escalating increases in project costs and impact on rate payers. • A call for more discipline in project costs estimation. • IURC recent statements re: cost estimates to support grant of CPCN.

  7. Contact Information David Stippler Utility Consumer Counselor www.in.gov/oucc Phone: 317.232.2494 Direct: 317.233.3232 Toll Free: 1.888.441.2494

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