Utilities More Concerned About Carbon Emissions: Survey

(Corrects executive’s name and title in fourth paragraph.)

Concern about carbon emissions increased last year among U.S. utility executives, who also expressed apprehension that customers won’t tolerate higher rates for power generated from renewable sources, according to a report.

Carbon emissions increased to third from sixth among the top environmental concerns of 543 managers and engineers, said Black & Veatch Corp. The Overland Park, Kansas-based engineering and consulting firm conducted the survey from Feb. 22 through March 23 and posted the results on its website today.

Utilities produced 42 percent of their electricity from burning coal last year, the industry’s top source of carbon emissions, and the need to reduce production of greenhouse gases is outstripping their ability to cut the amount of power they get from coal.

“There’s still a significant investment in coal assets, and it’s not economically reasonable to assume you could just jump off of that into a new technology,” Dean Oskvig, president of the company’s Black & Veatch Energy unit, said in a telephone interview.

More than 52 percent of respondents said complying with regulatory and environmental mandates to reduce emissions will require them to “significantly” raise customer rates, while 40 percent expected rates to increase “slightly,” according to the report.

About two-thirds of them said a rate increase of 5 percent to 10 percent would prompt customers to “object to further investment in renewables.”

Carbon-emissions legislation and water supplies remained the top two concerns among survey participants.

“A good way to think about water is that it’s another fuel,” Oskvig said. “It’s something that’s going to be used in a plant along with energy.”

To contact the reporter on this story: Justin Doom in New York at jdoom1@bloomberg.net

To contact the editor responsible for this story: Reed Landberg at landberg@bloomberg.net

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