CP&L's
Roxboro plant is one of 14 coal-fired power plants in the
state
NCCBI
issues statement explaining
its concerns with clean air legislation
In
a letter distributed today to every member of the House, NCCBI
explained that the association neither supports nor opposes
clean-air legislation requiring significant reductions in
emissions from the 14 coal-fired power plants in the state.
But the association made it clear that it is concerned about
the potential economic impact of the legislation on the
business community as well as on schools and other
governmental units whose power bills would rise sharply.
NCCBI distributed the letter to the 120 members of the House
after the House Pubic Utilities Committee began hearing
testimony on the Senate-passed bill, S. 1078 Improve Air
Quality/Electric Utilities. The committee heard testimony
on the bill Tuesday and is scheduled to take it up again on
May 29. The measure would require Duke Power and CP&L to
cut emissions of nitrogen oxide from the power plants by 78
percent by 2009 and cut emissions of sulfur dioxide by 73
percent by 2013.
The utilities estimate they would have to spend $2.2 billion
on pollution-control equipment and would have to pass along
that cost to their customers. Based on information previously
provided by the utilities, the legislation would likely result
in a cost increase of between $2.50 and $3.50 per megawatt
hour. Residential customers could see their bills increase 3
percent to 5 percent; industries would face up to a 7 percent
increase. A large industrial customer using 5,000 megawatt
hours a month would see its power bill go up around $15,000.
”The concept of the bill is valid; we all want clean air,”
the NCCBI letter says. “However, there are concerns that
many businesses cannot bear another cost driver during these
tough economic times.” The letter notes that North Carolina
lost more manufacturing jobs than any other state in the
nation last year. “For some companies, the cost impact of
this legislation will not be substantial to their bottom
line,” the NCCBI letter continues, “but for others who are
hanging on to businesses by their fingernails, this additional
cost could mean plant closings and lost jobs to a
community.” The complete text of the letter is reprinted
blow.
At Tuesday’s Utilities Committee hearing, textile
manufacturers and farmers said it would be difficult for them
to afford higher electricity bills. "This may be the
straw that breaks the camel's back," said N.C. Hosiery
Association President Vance Richardson. Ronnie Jackson, a
farm-equipment dealer from Clinton and a member of the N.C.
Agribusiness Council, said farmers are pinched between lower
commodity prices and rising operating costs, including gas
prices. On the other hand, Hugh Morton, owner of Grandfather
Mountain, said that because of pollution from power plants in
Tennessee and the Midwest, "everything's dead and
gone" atop Mount Mitchell. Unless N.C. cleans up its
power plants, it can't pressure the Tennessee Valley Authority
or utilities in the Ohio Valley to act, he said. "All of
us are in this together."
In a note to House members accompanying the letter, NCCBI
President Phil Kirk said “we have been asked by many members
of the House about NCCBI’s position on this legislation.
This is a very complex issue and we have spent a lot of time
talking with and listening to our members about this bill.
Because our members are divided on this issue, at this time
NCCBI’s Executive Committee has decided to take no position
on this bill.”
Because the issue is so important, Kirk said “we urge
members of the House to take the time necessary to understand
all aspects of this proposed legislation before taking final
action on the bill.”
Text of
NCCBI letter to all House members
explaining our position on clean air legislation
On
April 19, 2001, Leslie Bevacqua testified before the House
Committee on Public Utilities regarding House Bill 1015 (the
companion bill to Senate bill 1078) and posed several
questions concerning the legislation. At that time, on behalf
of NCCBI she urged that the committee delay action on this
bill until further information could be obtained on the
potential impact of this bill.
We wish we could say today that the questions that were raised
have been answered. Although we have discussed this bill with
the bill sponsors, many other members of the General Assembly
and many of our members, there are still a number of
unanswered questions regarding this bill.
In reviewing all of the information that we have to date on
this issue, our Executive Committee is divided and, therefore,
we cannot say that NCCBI either supports or opposes this
legislation.
On April 27, NCCBI’s Environmental Concerns Committee spent
a long time discussing the bill from the perspective of its
potential impact on the environment as well as the additional
costs that will be involved for all electric utility customers
in North Carolina.
Our Environmental Concerns Committee has raised concerns that
if this legislation is enacted, North Carolina will be going
further and faster than any other state in the country in
tightening regulations on air emissions. While the goal is
laudable, without the cooperative efforts of other states in
the region, our concern is that the actual impact on improved
air quality will be minimal at best.
The concept of the bill is valid; we all want clean air.
However, there are concerns that many businesses cannot bear
another cost driver during these tough economic times.
Proponents of the bill admit that this legislation may not
improve air quality in the mountains, but will put North
Carolina in a better position to encourage other states to
take similar action. They do believe that it will improve air
quality in other parts of the state.
NCCBI’s Environmental Concerns Committee members do not
believe that the benefits of this legislation outweigh the
costs. Based on that information, they recommended to our
Executive Committee that NCCBI oppose the legislation.
NCCBI has 2,300 members, including manufacturers, large
companies, small businesses, educational institutions,
community colleges, public and private universities, local
chambers of commerce and statewide trade associations. We have
members who feel strongly on both sides of this issue,
although a majority of those who have responded to us on this
bill have urged us to either oppose the bill or take no
position.
At this point, what we would like to do is to share with you
the comments and concerns that we are hearing from our
members.
If the result of this bill will mean cleaner air for the
entire state and bringing non-attainment areas into
attainment, then it may mean real help for our travel and
tourism industry. It may also mean opportunities for
industries currently located in the state to expand or for new
industries to move into North Carolina.
However, without the cooperation of other states in the
region, we are still going to be getting air pollution from
Tennessee, the Ohio Valley and other states. Without the
cooperation of these other regions of the country, our
mountain air quality is not going to be improved. We may see
improvement in some areas of the state -- possibly the
Triangle, the Triad and Mecklenburg County -- but air travels
and without a regional approach to this issue, North Carolina
may be making a large financial investment for little result.
In addition, we know that many of the air quality problems in
the major urban areas are the result of mobile sources
(automobiles), not stationary sources.
We are aware that Senator Basnight and others delivered a
letter to President Bush expressing concerns about TVA and
encouraging the federal government to get involved with this
issue. We also know from conversations with the bill sponsors
that they hope this legislation will give us some leverage to
get other states to act. Our members continue to be concerned
that the language in the bill doesn’t really have any teeth
in it and it won’t help us with the regional problems.
People in North Carolina are concerned about clean air. We
have had calls and letters from our members saying that clean
air is important for business, health and quality-of-life and
it is a particular issue for Western North Carolina and our
travel and tourism industry. And we believe the bill sponsors are accurate when they say
that people are willing to pay more for it. However, the cost
issue is still a big question with many of our members.
The impact of the increased cost will be on all consumers --
state and local government, schools, colleges, universities,
as well as small and large businesses and manufacturers.
North Carolina lost more manufacturing jobs than any other
state in the nation last year. For some companies, the cost
impact from this legislation will not be substantial to their
bottom line, but for others who are hanging on to businesses
by their fingernails, this additional cost could mean plant
closings and lost jobs to a community.
For state and local governments, schools, universities, and
community colleges, it will mean increased costs at a time
when they are being forced to cut spending.
Cleaning up these 14 coal fired power plants could have the
benefit of keeping other industries from having to make
additional investments in their facilities relating to air
quality, but there are no guarantees in this bill. It may be
more palatable to companies who will be paying higher utility
costs if there was some assurance that the state wouldn’t
come back in a few years and increase environmental
restrictions on individual companies that would likely raise
costs again. If this bill is going to move forward, that issue
should be considered.
North Carolina competes with other states for business and for
jobs. Clearly quality of life is one of the major factors that
companies look at when they locate in a region. But they also
look at the cost of doing business, including state and local
taxes, property costs, utility rates, qualified workers, etc.
This legislation will put us out in front of other states. It
will have us meeting requirements that no other state in the
country is required to do. While this could be an advantage,
it could also put us at a competitive disadvantage with other
states at a time when we are seeing the economy slow down and
people losing jobs.
It is clear to us from the discussions with NCCBI’s
Executive Committee members and from all of the telephone
calls that we have received on this bill that there is no real
consensus on this legislation.
We urge the North Carolina General Assembly to move slowly and
cautiously on this legislation, carefully weighing what
businesses and individuals can bear in terms of cost versus
what the real benefits will be if North Carolina is the only
state in the nation to take this approach.
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