In St. Paul, EPA chief touts energy efficiency to cut greenhouse gases

In a glimpse into the Obama administration's approach to curbing greenhouse gas emissions from power plants, the U.S. Environmental Protection Agency administrator said Wednesday that state programs like Minnesota's that advance energy efficiency need to be copied elsewhere.

"Minnesota has been aggressive on this issue," EPA Administrator Gina McCarthy said on a tour of the Science of Museum of Minnesota's new, highly efficient heating and cooling system. "We don't need to start from scratch. People get this. We just need to learn from what's already happening and figure out how to jump-start that in other places."

The EPA is set to announce on Monday proposed regulations to curb carbon emissions at U.S. coal-burning power plants, which contribute about 40 percent of the nation's greenhouse gases.

In visits to St. Paul and Burnsville, McCarthy also met privately with executives of Minnesota utilities, including Xcel Energy Inc., the state's largest power company and the nation's leading wind power utility, and Great River Energy, the state's second-largest power company and a proponent of a multistate carbon pricing plan.

McCarthy didn't offer details of the draft power plant rule, which already is being attacked by critics as a "war on coal." Her visit to the museum focused on energy efficiency, which is expected to play a part in any plan to reduce carbon dioxide emissions linked to climate change.

Unlike smog-causing pollutants, carbon dioxide can't be reduced using standard smokestack controls. So carbon regulation likely means replacing some coal plants, making others more efficient or running them less, investing in no-­carbon power sources like wind, hydro and solar and offering utility customers more incentives to conserve.

"She emphasized that the rule will be reasonable and flexible," said Jack Ihle, director of environmental policy for Xcel, who attended the private meetings.

He said it was clear from the meetings that the EPA rule will allow states like Minnesota to continue with policies promoting wind and solar power, energy efficiency and power-plant modernization. Xcel already has replaced two Twin Cities coal power plants with lower-carbon natural gas units.

At the Science Museum in St. Paul, McCarthy visited the boiler room to see an $840,000 heat-recovery system that recycles waste energy and is expected to reduce heating and cooling costs by $205,000 a year. The technology, manufactured by Trane in La Crosse, Wis., cuts the museum's overall energy use by 40 percent, said Patrick Hamilton, director of the museum's global change initiatives.

"The big value in coming out is that we see this stuff is happening," said McCarthy, who was joined by St. Paul Mayor Chris Coleman. "We don't need to reinvent the tools to get there. We need to give states the flexibility to build on the tools that they already have been using, the work that's already ongoing, the energy that already has been generated in places like this."

Focus of carbon rule

David Thornton, assistant commissioner for air policy at the Minnesota Pollution Control Agency, said Minnesota utilities' investments in clean energy and conservation programs under a 2007 state law have lowered greenhouse gases 12 percent to 13 percent from what they would have been without such programs. The law requires power companies to reduce customers' electric use by 1.5 percent each year — and allows investor-owned utilities to earn a profit on conservation investments.

"Everything I have heard from the EPA is that they want this to be a flexible rule and give states a lot of leeway," Thornton said. "It is not just how you go in and tinker with your boiler and your turbine."

Duluth-based Minnesota Power, which a decade ago relied on coal for 95 percent of its power to serve northern Minnesota, is on track this year to meet the state mandate to get 25 percent of electricity from wind, a decade earlier than the law requires. The utility's energy efficiency program has been shaving 2 percent off customers' power use annually.

Minnesota utilities have announced plans to shutter 12 older, mostly smaller coal-burning power plants rather than make new investments in them. Xcel has said it is waiting for the carbon rules before deciding the fate of two large, 1970s-era coal generators in Becker, Minn.

Great River Energy, a wholesale power supplier based in Maple Grove owned by 28 local power cooperatives, has offered a plan to include carbon costs in the price of electricity as utilities sell it on the electric grid. With such market incentives, the utility contends that only the most-efficient coal plants would get to sell power into the grid.

"We think that market solutions are a really great way to implement regulation to maximize reliability," said Eric Olsen, vice president and general counsel for the wholesale cooperative.

Great River Energy gets 67 percent of its power from coal power plants but has made them more efficient partly by recovering waste heat and selling the energy to nearby industries.

David Shaffer • 612-673-7090 Twitter: @ShafferStrib