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Kentucky Resources Council, PO Box 1070, Frankfort, KY 40602 Phone [502] 875-2428

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PO Box 1070, Frankfort, KY 40602  Phone 502.875.2428, Fax 502.875.2845

KRC Statement On Beshear Administration Energy Plan  Posted: November 20, 2008
Statement of Tom FitzGerald, Director,
Kentucky Resources Council, Inc.
In Response to Release of
"Intelligent Choices for Kentucky’s Future – Kentucky’s 7-Point Strategy for Energy Independence"

The Council has reviewed the proposed Beshear Administration Energy Plan, and appreciates the effort that has been expended to produce the plan by the Energy and Environment Cabinet staff under the direction of Dr. Peters. The Council understands that this is the beginning of a discussion and that public input will be solicited on the strategy and its components, and we look forward to providing input on behalf of a constituency who has historically borne the “off-budget” impacts of our “cheap” power in the form of air, land and water pollution.

There are many aspects of the plan with which the Council agrees, particularly the emphasis on the significant progress that can be made in the near-term in mitigating Kentucky’s contribution to climate change, while saving money for Kentucky utility ratepayers and moving us toward a sustainable energy future, and creating new, durable employment by significant investment in energy efficiency on both sides of the meter, and from deployment of a range of renewable technologies.

The Council also appreciates the engagement of the Beshear Administration in a conversation that has been occurring in the General Assembly during the 2007 Special Session and the 2008 Session, which under the leadership of Rep. Adkins, Moberly, Pullin, Pasley, Webb, and Senators Leeper, Harris, Stivers and the membership of both chambers, have provided a broad array of policy changes to create incentives for renewable energy, energy efficiency, and reforms of utility regulatory policy.

Kentucky’s “cheap” power has lulled us into wasteful use of energy resources to meet our needs. The failure to have required full-cost life-cycle accounting for the real cost of our fuel choices has led us to this time – where Kentucky is at “ground zero” for climate change, with our 98% dependence on carbon-emitting fuels to provide our electricity, almost no diversity in our energy portfolio, and with a population that is already hard-pressed to meet utility costs and will be even harder-pressed to afford the steep increases in utility rates from the coming cost of fully accounting for the pollution burden from this supposedly “cheap” fuel. President-Elect Obama indicated to the Governor’s Climate Summit earlier this week that he will seek a federal cap-and-trade system for greenhouse gases with an interim target of reduction by 2020 to 1990 levels, and an additional 80% by 2050. Substantial investment by the Commonwealth in energy efficiency, in demand management, and in renewable energy within the next decade is the best hedge to protect Kentucky’s low- and fixed income citizens, businesses and industries against rising costs, and towards meeting the interim greenhouse gas reduction target that will likely be enacted within the next two years.

With respect to the strategy points encouraging greater deployment of coal gasification, coal liquefaction and nuclear technologies, it is no secret, and the Beshear Administration is well-aware of the Council’s belief that without an effective carbon capture and management strategy, and absent significant reduction from current levels of the unnecessary damage inflicted on coalfield communities from radical mining methods, investment of public monies in deployment of coal-to-liquid and coal gasification technologies is unsound public policy, since it moves us no closer to addressing our contribution to our climate crisis, but instead appears to be aimed at enhancing the value of the coal industry’s holdings at the cost of climate damage.

The Council believes that full-cost, life-cycle accounting of the “footprint” of energy choices, from mine to beneficiation, transportation to combustion, and resulting waste management, is essential, whether assessing coal combustion, gasification or liquefaction, nuclear power or renewable energy sources. Had we, as part of the process of approving a generation of coal-fired power plants, required that such “externalities” be monetized and evaluated, we might not be so vulnerable to the climate crisis, because we would have a diverse, flexible portfolio of energy sources, and a lower rate of usage of power to meet the same needs. Ironically, whether considering sulfur dioxide, nitrogen oxides, particulates, mercury, or carbon dioxide, externalities become internalized in the cost of energy eventually, often at much greater cost than had they been considered in the initial energy choice.

The Council continues to believe that expansion of reliance on energy from nuclear power, absent a strategy for permanent management of spent fuel rods and other high-level nuclear wastes, is imprudent, since it creates significant vulnerability to host communities from indefinite “temporary” storage of such waste on site. Safer, less inexpensive, and less problematic energy sources can be developed and should be the focus of our strategy.

Kentucky is not an island, and while reduction in dependence on fuels from unstable regions is a laudable goal, energy independence does not mean that each state must produce 100% of its energy needs. Kentucky is well-positioned to take advantage of significant solar, hydro, and biomass technologies that can provide carbon-free or carbon-neutral energy, and to work with other states to develop sustainable energy supplies to meet anticipated growth in energy demand, from other renewable sources. Expansion of reliance on fossil fuel sources that excavate sequestered geologic carbon and contribute to atmospheric releases of that carbon, is a path away from rather than towards a sustainable economy and a habitable environment.

We appreciate the Administration’s recognition of climate change as a significant challenge facing our state, and look forward to working with the Administration and the General Assembly to help transition Kentucky past crisis towards prosperity in a carbon-constrained world.


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