The Cost of Environmental Protection: Higher Electricity & Natural Gas Prices
Regardless of your measure of commitment to a clean environment, it is a fact the implementation of new legislation will be expensive. The EPA heavy hand is granted under the authority of the Clean Air Act (CAA), Clean Water Act (CWA), Resource Conservation and Recovery Act (RCRA), and Mercury and Air Toxics Standards (MATS) to tighten emissions standards at coal-fired power generation plants. According to IBISWorld market research, the cost to comply with these new EPA standards will be a 1.5% annual growth in electricity prices. The overriding intent of the EPA is to encourage coal-fired power plants to convert to natural gas. In doing so, the stimulated demand for natural gas will push prices up by 7% annually between 2014 and 2017. These price increase drivers are likely not the only price drivers consumers of electricity and natural gas will be subject to in the next three years.