As leaders of your Kansas Senate and House of Representatives, we are gravely concerned about the statewide impact of the Sebelius administration's recent decision to reject an air quality permit for two coal-fired plants in the state.
We believe our state energy policy decisions should be based on sound scientific and economic analyses that accurately and honestly address costs and benefits. However, the Sebelius administration rejected just such analyses conducted over the past several months by the professional staff of the Kansas Department of Health and Environment (KDHE). Instead the decision was based on KDHE Secretary Rod Bremby's opinion that additional carbon dioxide (CO2) in the atmosphere presents a "substantial endangerment" to public health. The governor's public position and her administration's decision are misleading and misguided.
In spite of the KDHE secretary's concerns, neither the federal Environmental Protection Agency nor current state statutes consider CO2 a pollutant. Kansas law does not give KDHE, its secretary or the governor the authority to limit an unregulated emission. In fact, the most recent KDHE Air Quality Report (2004-2005) makes no mention of CO2, the impact of CO2 or any monitoring efforts by the state.
Negative impact on state
We are deeply troubled by the Sebelius administration's failure to comprehend the effects of its denial of air quality permits for coal-fired plants, and its attempt to regulate CO2. These actions have a considerable negative impact on our state budget, other Kansas industries, economic development and the security of our state's energy future.
The Kansas economy relies on several key industries - including cattle, oil and gas, aviation, construction - all of which produce CO2. Do the governor and her administration intend to regulate the CO2 output of those industries as well? We hope not. Any attempt to mandate carbon reductions below natural market levels will increase energy costs for Kansas consumers and businesses. We have already heard from a number of concerned business interests; companies considering locating or expanding in Kansas may reconsider if a reliable source of reasonably priced energy is not available.
Here are the facts: Had the application for an air quality permit for the project in western Kansas been approved, the $3.6 billion infrastructure investment would have created more than 320 direct and indirect full-time positions earning more than $16 million. It would have increased employment at the plant by more than 100 positions to a work force of 265. During the construction phase, some 2,400 jobs would have been created, paying more than $78 million per year, increasing tax collections by more than $9.3 million.
It would have provided an opportunity to build more transmission lines which would have promoted additional wind energy development in western Kansas. Renewable energy such as wind and solar power require a significant infrastructure of transmission lines that cost about $1 million per mile to build. Without new coal plants, some energy companies may be hesitant to add those lines because of the low rate of return on their investment.
A highlight of the proposal was the development of the only fully integrated bioenergy center in the country. The center was to include a biodiesel and ethanol plant, an anaerobic digester, a dairy farm and a microalgae reactor. The reactor would have utilized CO2 to grow algae for renewable fuels production. This new technology and integration would have rendered the expansion nearly carbon neutral.
Environmental groups are even beginning to realize that capturing the energy of the sun and the wind leaves an incredibly large environmental footprint. Many individuals and communities have begun to protest wind or solar projects in their neighborhoods. The governor herself banned the placement of wind farms in the Flint Hills, and an attempt to locate a wind farm in Ellis County was defeated.
These are but a few of the reasons Kansas must carefully balance renewable energy sources with the continued growth of baseload (energy that can be produced at peak times at a low cost) coal and nuclear energy resources. There are no plans to build a new nuclear plant in Kansas. Natural gas is a finite resource. However, the federal Energy Information Administration projects coal prices will remain relatively stable - between $20-$22 a ton over the next 25 years - making it a reliable, cost-effective source for future energy needs.
Energy demand in Kansas is expected to grow by 50 percent in the next 25 years - a demand that cannot be met by current production. We believe the state's energy policy must include a balance of baseload energy, renewable energy and conservation efforts.
We sincerely hope the Sebelius administration will reconsider its position. In the meantime, we intend to continue exploring our legislative options in the wake of KDHE's disastrous decision and we commit ourselves to redoubling our efforts to form wise, responsible energy policy for the state of Kansas.