EPA Regulations Set To Increase Natural Gas Prices By 150 Percent

Environmental Protection Agency policies resulting in the shutdown of coal-fired power plants will contribute to a 150 percent price hike for natural gas

Natural gas prices will increase 150 percent over 2012 levels

MATS is one of the costliest EPA regulations ever crafted, costing about $10.2 billion annually. The rule aims to lower mercury emissions and other pollutants from coal plants, but the regulation is resulting in the shuttering of hundreds of coal plants across the country.

EIA says that 50 gigawatts, of the U.S. coal fleet is set to be taken offline 90 percent of these shutdowns will occur before 2016 when MATS goes into full effect. But as coal plants are shuttered, they will primarily be replaced with natural gas-fired power plants and some renewable generation. Generating more power from gas means that the price will go up from today’s low levels to much higher levels in the coming decades. This will also drive electricity prices skyward.

“The rising use of natural gas in the electric power sector results in price increases for both natural gas and electricity in all sectors,” EIA says

But it’s not only higher prices that Americans should be worried about, as retiring coal plants means the U.S. will be generating less power overall because coal provides most of the baseload power in the country. EIA notes that “removing coal capacity results in lower overall levels of generation.”
Federal energy regulators are worried that MATS could lead to “rolling blackouts” across the country because of premature coal retirements.

“We’re closing an enormous amount of coal generation, through a variety of rules, and a good number of those plants are set to retire next April,”Federal Energy Regulatory Commission commissioner Philip Moeller

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