A Unique Opportunity for Rural Electric Cooperatives

1. A Unique Opportunity
for Rural Electric
Cooperatives
Alex Keiser, Tulane University Law School
Lawrence Kahn, Tulane University Law School

2. Introduction: Welcome to Christine, Texas

3. Background:
Rural America, RECs, and decarbonization efforts
● Before RECs developed, 90% of rural Americans did not have access to
electricity
● Today, there are about 900 RECs across the country
● 46 million Americans live in rural areas serviced by RECs
● RECs service over 90% of America’s persistent poverty communities
○ There are about 21 million people living in persistent poverty communities
○ About 60% of the people living in persistent poverty communities are racial and ethnic minorities
● RECs maintain approximately 42% of the country’s distribution lines covering a
whooping 75% of the country’s landmass
● RECs meet about 11% of the country’s electricity demand

4. Legal Background:
Federal Environmental Statutes
● There are several critical federal statutes in the suite of pollution control
laws: the Clean Water Act, The Clean Air Act, the Resource Conservation and
Recovery Act, The Oil Pollution Act, and the Comprehensive Environmental
Response, Compensation, and Liability Act
● Clean Air Act governs air pollution and emissions and offsets
● In June of 2022, the Inflation Reduction Act Amended the Clean Air Act to
include carbon dioxide as a criteria pollutant
● The Comprehensive Environmental Response, Compensation, and Liability
Act governs the clean up and cost recovery of hazardous substances

5. Close Up: The Clean Air Act
● Originally passed in 1970 with a unanimous vote
● 4 goals of the CAA
● Regulates emissions from mobile and stationary sources
● Summer 2022 Clean Air Act turbulence
● NAAQS, SIPs, FIP, BACT, LAER and Attainment classifications
○ NAAQS = National Ambient Air Quality Standard
○ SIP = State Implementation Plan
○ FIP = Federal Implementation Plan
○ BACT = Best Available Control Technology
○ LAER =

6. Close Up: CERCLA
● Passed in 1980
● Governs the cleanup of hazardous substances
● Strict liability
● Limited Defenses
● Four enforcement options and the expense of liability
● What is the significance of CERCLA in this context?
○ Environmental Justice priorities of the current administration
○ EJScreen and how EPA and DOJ screen cases as environmental justice concerns

7. UVM and Carbon Credits:
a Proposal for RECs
● Carbon credits are bought and sold through cap-and-trade programs such as the
California Cap and Trade Program and the Regional Greenhouse Gas Initiative
● 1 carbon credit = one metric ton
● Carbon credit pricing → the cap and trade system is designed so that the credits
become more expensive as time passes
● How can UVM and forest management in the REC context can create access to
the carbon credit market
○ The land available to RECs is substantial
○ Growth potential
○ Federal funding
● Carbon Credits are not the only option!
○ Endangered Species Act protected habitats and conservation banks
○ Federal funding for conservation and environmental protection, especially under the recently
passed Inflation Reduction Act

8. Conclusion
● The significance of the position of RECs in decarbonization efforts
● The environmental, economic, health, and legal costs of pollution and business
as usual
● Environmental stewardship and economic growth do not have to be at odds with
each other
● RECs should capitalize on the use of UVM to enter the carbon credit market and
explore funding options from other federal programs to help them get started
● Because there are so many RECs, they are fantastic innovation labs for such
work
● This new capital stream can help bring new economic opportunity and even help
start the funding toward a renewable transition for RECs