Energy Realities Facing North Dakota

by Jason Schaefer
Contributing Writer

The Bismarck-Mandan Chamber, US Chamber and Chamber of Commerce of Fargo Moorhead are partnering to host an energy forum for North Dakota. The event will examine the consumer cost of implementing carbon reduction policies. The free event will be held from 6-9pm on March 18th at the Holiday Inn in Fargo.

The keynote address will be delivered by Margaret Thorning of the American Council for Capital Formation. ACCF has a conservative perspective on economic policy and advocates policies that favor big business, according to SourceWatch.org. They are affiliated with groups such as the American Petroleum Institute and American Enterprise Institute, long known for their denial of human-caused climate change.

Just recently, organizers of the event added a panelist from ND Climate, a non-profit dedicated to raising public awareness of the global warming problem and how our state can prosper by helping to solve it.

Seeing as there is no major or credible scientific organization disputing that the climate is warming and greenhouse gas emissions from fossil fuels are the primary cause, experts agree that action must be taken.

Scientists say we need a 60-80% reduction in CO2 to avoid the worst effects of climate change. Some sort of cap or fee on carbon dioxide is considered inevitable. Here’s Peter Darbee, CEO of Pacific Gas & Electric: “I believe--based on discussions that we’ve had with the experts here in Washington--the probability that we will see legislation on climate change to be about 100 percent in the next five years.”

Business knows this and many multinational companies are already dealing with carbon caps in Europe. More and more utilities and corporations are arguing for a national climate policy so that they can make long-range plans. Last January an alliance of major businesses such as Caterpillar and General Electric, along with leading environmental groups like the National Wildlife Federation called for major, economy-wide reductions in emissions.

Coal seems to be the most vulnerable to the seemingly inevitable carbon reduction policies. Coal’s carbon liability is becoming increasingly problematic. On February 4th, four major investment banks announced they were imposing new environmental standards that will make it harder for companies to get financing to build coal-fired power plants in the U.S. Last fall, the Kansas Department of Health denied permits for two large plants citing concerns over CO2 emissions. 59 coal plants were canceled, delayed or blocked in 2007. Of the 59 projects, only 15 were rejected outright by regulators, courts, or local authorities. In the remaining 44 cases, the decision was made by the sponsors themselves. At least four dozen coal plants are being contested in 29 states, according to a recent Associated Press tally.

Minnesota passed climate legislation last year and is looking at carbon fees of $9-30/ton. Governor Pawlenty and Governor Doyle of Wisconsin have formed a Midwest Carbon Exchange to regulate and trade carbon credits. Over half the electricity we produce in North Dakota is exported to Minnesota.

Currently, over 90% of the electricity produced in North Dakota comes from coal power plants. Coal plants are the leading emitter of CO2. Lignite, the type of coal we use in North Dakota, emits more CO2 than other types of coal.

Clearly, If North Dakota does not aggressively diversify its energy portfolio to renewables, such as wind, the state will be particularly vulnerable to the effects of carbon regulation. The firm, scientific consensus regarding human-caused climate change demands that these changes be made throughout our society. So far, our leaders have chosen to fight much larger states like Minnesota while stubbornly ignoring or denying the inevitable realities of carbon regulation.

North Dakota should embrace inevitable carbon regulation. We are the number one state in wind potential - enough to light up over 25% of the U.S. Wind, an $18 billion industry in 2006, is projected to grow to over $60 billion by 2016. N.D. also has potential in biofuels and other low carbon technologies.

Reality and logic dictate that North Dakota start investing in renewables more aggressively and diversify our energy portfolio. By investing in efficiency and low or zero carbon solutions such as wind, ND ratepayers will be better able to absorb inevitable increases in the cost of energy while reaping economic benefits from emerging industries.