Yep. It can happen.
How does this affect you? Well, that depends on where you live and the outcome of lawsuits that have not been heard in court, yet. There is no guarantee that the lawsuits will go forward now that they have the green light. If the plaintiffs (which are states) win (meaning the power companies are found to be a public nuisance for emitting carbon), you can expect to see higher electric prices and possibly declining investment values (the companies are shareholder owned). We may also witness a fundamental change in the way we use energy services. Of course, the result will depend a lot on the actual decision, and getting to that decision could take awhile.
In 2005, a district court decision determined that the public nuisance cases against some large power companies for carbon emissions were political. Hence, the determination was that the suits couldn’t go ahead because the cases were being brought to make a political statement, and the court did not want to enter a political battle.
However, the plaintiffs appealed the lower court’s ruling, and the federal court of appeals panel assigned to the case has ruled that the suit can go forward even without federal laws against carbon emissions. Although Congress has yet to legislate reductions in carbon emissions, the issue seems to be gaining ground in the courts. You may recall the 2007 Supreme Court decision that the EPA could indeed regulate greenhouse gases under the Clean Air Act.
Let’s think about this
I am fine with the ruling that these suits can be heard. I think it is good for people to get to argue their cases in public. However, I think the idea of bringing a lawsuit against power companies as a ‘public nuisance’ is misguided at best. Remember, the plaintiffs are STATES! Of course, they may not follow up at all since so much has changed, and even more appears poised to change, with the electric generating industry since 2005.
Assuming that they do go forward, what would they like for these power companies to do? Named defendants: American Electric Power, Southern Company, the Tennessee Valley Authority, Xcel Energy and Cinergy Corporation
Plaintiff states:California (re-regulated), Connecticut (deregulated), Iowa (regulated), New Jersey (deregulated), New York (deregulated), Rhode Island (deregulated), Vermont (regulated) and Wisconsin (regulated). [NOTE: regulated states are as much responsible - through their Public Utility Boards or Commissions - for their mix of power as the companies providing it because they approve construction, operation, and rates. Deregulated states are not as hands off as they might appear, either.
What can they do?
These companies are a bit wedged. *between a rock and a hard place* Their customers don't want to volunteer to pay more for green power (enrollments in such programs are really small), sometimes state regulators won't let them raise rates to pay for new power plants or improved transmission, the existing laws favor holding on to aging power plants as long as possible because new ones face more stringent regulations, they operate in a capital intensive world, AND they face additional hurdles to build new green or nuclear power. [Note: The above companies are electric generators which are different, legally and practically, from electric utilities which are regulated in most states -- however, the two are intertwined.]
What is already being done?
Laws and regulations already in place will usher in a new era of power generation. However, there is a delay. It takes time to site, permit, and build new generation. It also takes transmission – which is in a sore condition in this country.
Companies already have filed to build new nuclear, new wind, new solar, etc…it just takes time.
Companies have a good deal of capital invested in their existing power plants. When these plants are retired (and replaced by new plants which are not paid off), the costs of operation to the company (read: the costs of electricity to consumers) will rise. That’s okay, it is fine for prices to rise to cover the costs. However, state limits on prices make this a difficult subject.
Whose fault is it?
If I drive my car more than necessary, and I cause the emissions of more pollutants than my auto manufacturer or the gasoline company (assuming I only used one) planned that I would, is that my fault or the fault of the companies enabling me? It’s my fault If you make cookies, and your friend eats all of them and gets a)fat or b)sick is that your fault? NO!!!
My point is that these companies are providing a service to willing buyers. They should not be held up as the bad guy just because they have a popular service. AND…I bet some of the folks lined up behind their states, chanting, “Big, bad, carbon emitting power company!!!,” left their lights on, left their vampire electronics plugged in, and probably drove in a single-occupancy vehicle.