Climate change plan seen doubling coal plant closures

President Barack Obama’s signature effort to control carbon dioxide emissions would likely double the closure of coal-based power plants, according to a new U.S. Energy Department analysis.

Electricity prices would increase by an average of 7 percent by 2025, according to the analysis released by the Energy Information Administration on Friday.

Mr. Obama’s Clean Power Plan to combat climate change, released by the Environmental Protection Agency in June, would by 2020 cut carbon emissions from power plants 25 percent below 2005 levels, the EIA report shows. “Switching from coal-fired generation to natural gas-fired generation is the predominant compliance strategy,” the EIA said.

Its analysis shows that as much as 90 gigawatts of power generated by coal plants would be retired by 2040, with most of the closures coming by 2020, the first deadline proposed for carbon cuts under the EPA’s draft rule.

Without the carbon-cutting plan, 40 gigawatts of coal power would be retired in that timeframe, according to the EIA’s annual energy outlook.

Coal production will decline 20 percent by 2020 and 32 percent by 2035, from a business-as-usual case, according the latest report.

Natural-gas use initially would replace lost coal, with wind power and other renewable energy sources taking a greater share of U.S. electricity production in later years, the EIA said.

While retail electricity prices are projected to increase as much as 7 percent on average from 2020 to 2025, in some regions the costs begin to recede to the EIA’s baseline levels by 2030. Electricity costs in the Southwest and Southeast may remain high, according to the report.

Representative Lamar Smith, a Texas Republican and critic of the EPA, requested the analysis from EIA.