US Missed An Opportunity To Cut Carbon At Lower Cost

The United States missed an opportunity to fuel its renewables revolution at a fraction of the cost when it failed to put a price on carbon, John Rowe, former CEO and chairman emeritus of Exelon Corp, said Wednesday in Chicago.
"As far as I'm concerned the renewables industry is built on the proposition that we should always do the most expensive thing first," Rowe said at the Energy Thought Summit at Chicago's Symphony Center. "Whereas a carbon tax or cap and trade would have encouraged doing the cheapest things first."
The cheapest things, Rowe has said before, would be increasing energy efficiency and increasing the capacity of existing nuclear plants.
Rowe, who retired in 2012, was among the first utility executives to focus on climate change, warning of the dangers of carbon pollution as early as 1992, when he was CEO of New England Energy Company. In 2009, as CEO of Exelon, he supported the Waxman-Markey cap and trade bill, also known as the American Clean Energy and Security Act.
That was an easy position for him to take, he said Wednesday, because Exelon has the country's largest fleet of nuclear reactors.
Utilizes that opposed cap and trade—the defeat of which delayed climate action for most of a decade—made a calculated decision to postpone the inevitable , he said.
"The utilities that dragged their feet were Southern, Duke, AEP—Duke would argue that, but I think they were," Rowe said. "Who was right? They're still running most of those coal plants. Delaying the inevitable can be a very good strategy."
I contacted all three of these companies Wednesday night.
Melissa McHenry, director of external communications for American Electric Power: "I'm actually a bit surprised that he made this statement. AEP has long lead the industry in advancing technology to address climate change."
Jack Bonnikson, spokesman for Southern Company: "Southern Company is leading the way in developing real energy solutions for a carbon-constrained future.”
Tom Williams of Duke Energy: "I'm not sure what John Rowe is referring to. He's been out of this business for a while now. We've retired more than 40 coal plants in the last few years. Our emissions have gone down 20 percent on carbon since 2005, and we're also building a huge amount of wind and solar."
Duke Energy was a member of the U.S. Climate Action Partnership (USCAP) , a coalition of businesses and environmental groups that supported the Waxman-Markey bill, which narrowly passed the House but perished in the Senate.
"Congress rejected Waxman-Markey in favor of renewable standards that cost two and three times as much," Rowe said Wednesday. According to Rowe, Waxman-Markey would have put a $25/ton ceiling on the price of carbon, but wind energy, the cheapest renewable, needs a carbon price of $50/ton to be viable.
So the state renewable standards and federal subsidies that have fueled the renewables revolution represent a far more expensive route than cap and trade would have been.
Rowe recalled Wednesday that he took some flak from Republicans for his support of cap and trade.
"Bob Corker and Jim Inhofe called me a whore for doing it," he said of Tennessee Sen. Robert Corker and Oklahoma Rep. James Inhofe, "and it took a couple of Republican fundraisers to write to them and say, 'He may be a whore but he's our whore, get off of him.'"