Akins discusses proposed carbon rules on Bloomberg TV

Nick Akins (right) is interviewed by Trish Regan during a segment of Bloomberg TV’s “In the Loop” show.

Nick Akins, AEP president and chief executive officer, appeared on Bloomberg TV July 29 to discuss potential new environmental regulations on carbon dioxide, the continued growth of shale gas activities, the economy and more.

View the video segment on Bloomberg TV.

Akins noted that with the Environmental Protection Agency’s Mercury and Air Toxics Standards rule and the increased utilization of natural gas, the electric utility industry has already reduced carbon emissions by 16 percent.

 “If you remember the Waxman-Markey requirements, it was 17 percent by 2020, and we are already achieving those types of goals,” Akins said.

So what is AEP’s — and the industry’s — biggest concern about what President Obama’s administration may do on the environmental front?

“If the greenhouse gas requirements are particularly onerous, we’re going to have further impact on the coal-fired fleet and the economy itself,” Akins answered. “Electricity prices will move up if we have to retire a substantial amount of the coal-fired capacity.”

As an example of the economic impact, Akins noted that the industrial sector in AEP’s territory is already off by 12.5 percent from pre-recession levels.

“It’s very tenuous in the industrial and manufacturing sector,” he said, “and in the last quarter it continued to decline. Industrial and manufacturing companies depend on low electricity rates. When you retire this capacity, you could see rate increases on the order of 11-to-25 percent, and that’s not good for industrial and manufacturing, or for residential consumers.”

Despite EPA regulations, Akins said coal will remain in the energy generation mix of the future.

“I think coal-fired electricity will not be as dominant as it has been in the past, but it will remain a large portion of the mix that we have to supply the energy needs of this country for the next several decades,” he said. “We need to have a broad brush of everything (including natural gas and renewables) available to us, inlcuding coal.”