GAP Responds to Misinformation About Merchant Allocation

WASHINGTON, Nov. 4 /PRNewswire/ -- Generators for Affordable Power (GAP) today sent a letter to key U.S. Senators responding to inaccurate information being circulated by the American Public Power Association (APPA) and the National Rural Electric Cooperative Association (NRECA). These interest groups have mounted a lobbying campaign to undo a carefully-crafted compromise designed to protect consumers and included in both the House and Senate versions of climate legislation.

The complete text of the letter is available upon request

In its letter, GAP emphasizes the need to provide emissions allowance allocations to merchant generators under the Clean Energy Jobs and American Power Act (S. 1733) to protect consumers, ensure grid reliability and promote economic growth.

If merchant generators are denied allowances, the financial burden of complying with both existing environmental regulations and new climate legislation would force plants to shut down. With fewer low-cost plants to meet demand, Americans will increasingly have to rely on more expensive energy sources, such as natural gas. A study conducted by ICF estimates that the loss of coal-fired generation and shift to other forms of power will "lead to electricity price increases of 11 to 16 percent nationally, with spikes over 30 percent in some areas."

The letter also responds directly to arguments levied against merchant generators by groups seeking a larger share of the electricity sector's emissions allowance allocation. As GAP notes in the letter, "Both the House and Senate bills demonstrate that consumer protection is eminently achievable and include numerous provisions to ensure that allowance value benefits customers."

In closing, GAP requested that the Senators "retain the consumer protection provisions associated with the allocation of emission allowances to merchant coal generators. This allocation will not only help to mitigate the increased costs that consumers will experience as a result of the legislation, but will also contribute to the nation's energy stability."

About Generators for Affordable Power (GAP)

GAP is a coalition of independent energy producers, or "merchant coal generators," who sell wholesale, coal-fired power to local distribution companies (LDCs) that, in turn, deliver power to homes and businesses. Independent energy producers operate plants nationwide with major operations in Connecticut, Delaware, Illinois, Indiana, Louisiana, Maryland, Massachusetts, Montana, New Jersey, New York, Ohio, Pennsylvania, Texas, Virginia, and West Virginia..

GAP member companies include AES, Allegheny Energy, Ameren, Constellation Energy, Dominion, Dynegy, Edison International, Energy Future Holdings, FirstEnergy, GenPower, International Power, Mirant Corporation, PPL, and RRI Energy. Merchant coal generation facilities associated with GAP companies employ over 15,000 people at 77 facilities with a generation capacity of over 60 gigawatts.