This document is a letter from Thomas Kuhn of the Edison Electric Institute to Secretary of Energy Spencer Abraham regarding a proposal for the electric power industry to voluntarily reduce greenhouse gas emissions. The letter outlines a plan for the Electric Power Industry Climate Initiative (EPICI) to work with the Department of Energy to reduce carbon intensity in the power sector by 3-5% over the next decade through individual company actions and joint industry initiatives. It requests that the government implement policies to support low-carbon technologies and activities to help the industry meet this voluntary goal.

1. "Cobb, Al" <Al.Cobb~hq.doe.9OV>
<
7 01/21/2003 11:41 :52 AM
Record Type: Record
To: Phil Cooney/CEQ/EOP@EOP
cc:
Subject: FW: EEl letter of intent to Secretary Abraham
Phil -
Following up from our meeting here earlier this morning ..
Al
---- Original Message ---
From: Dobriansky, Larisa
Sent: Friday, January 17, 2003 6:10 PM
To: Cobb, Al
Subject: FW: EEl letter of intent to Secretary Abraham
Here are the documents.
---- Original Message ---
From: Bill Fang [mailto:BFang~eei.org]
Sent: Friday, January 17, 2003 5:37 PM
Larisa;
To: gkelly8@comcast.net; john.quiflflconstellatioflcom; Dobriansky,
mmq~nei.org
Subject: EEl letter of intent to Secretary Abraham
EEL letterhead are
The letter and enclosures are attached. Signed copies on
being delivered by messenger to DOE, CEO and EPA.
Everyone, please try to keep this to yourself until Feb. 6.
IE
-abrahamkuhnletter0l
13SO3Enclosurel,'C 601dat.o
3
~-abrahamkuhflletteroll3o3Enclosure2,0lo20 draft3.doc
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2. January 17, 2003
The Honorable Spencer Abraham
Secretary of Energy
U.S. Department of Energy
1000 independence Avenue, S.W.
Washington, D.C. 20585
Delivered by Messenger
Dear Mr. Secretary.
to support voluntary actions to reduce
The Edison Electric Institute (EEI) pcontinuies U.S.
supports the President's goal of reducing
greenhouse gases (GHGs) and specifically 1 are world
EEI and the electric utility industry
GHG intensity over the next decadel sequester GHGs. In fact, in 2000 power
leaders in voluntary actions to reduce avoid or and
of the total reductions, avoidances
sector activities comprised about 70 percent activities
Infonnation Administration. These
sequestrations reported to the EnerIgy and demand-
to nuclear plants; energy efficiency
primarily consisted of improvements' recovery,
provements to fossil-fuel plants; methane
side management (DSM) projects; i¶
renewables projects.
forestry projects and fly ash reuse; and
to
industry allies and our member companies
EEI has been working with our EICI to
sector that reflects our fair contribution
develop a joint response from the entire power umbrella
EPICI plans to enter into a cooperative
the President's goal. Accordingly, with DOE by May 1, 2003. In this
agreement or memorandum of understanding (MOUT) reduce the
industry allies and the government to
decade, EEI will work with our EPICI
equivalent of 3 to 5 percent.
power sector's carbon intensity by the
sector groups - Nuclear
action, EEl j oined with six other power
in response to President Bush's call for Council, National Rural
Po>wer Association, Large Public Power
Energy Institute (NET), American Public and Tennessee Valley
Power Supply Association (EPSA)
Electric Cooperative Association, Electric, primary
Authority (TVA) - to form the Electric
Power Industry Climate Initiative (EPICI). EPICI's and with
voluntary climate activities in cooperation with,
purpose is to coordinate the power sector's agencies. The partnership
assistance fromi, the Department of Energy (OE) and other government 3m
Partnerss. Poe Partners , along with other
between EPICI and DOE has been designae "Power for Climate Action" (also
kthe Administration's "Energy Partners
industry partnerships with DOE, constitute participating in other
Sevpa EEI member companies are also
referred to as "Business Challenges"). Protection Agency (EPA)),
Leaders (with the Environmental
voluntary climate programs, such as Cliat d Table and Partnerships for Climate Action.
Roun
Chicago Climate Exchange, Business

3. 4. ~~The Honorable Spencer Abraham
January 17, 2003
Page 2
as few sectors in the economy are likely to
Accomplishing this goal will be very diffcult,
our industry from 2000 to 2010. This goal
experience the level of growth forecast for
and their members - with government
will be achievable only if all EPICI trad groups
2 together to implement robust supply- and
support and appropriate policies _ wrk
A combination of power sector and
demand-side actions as well as offset projects.
individual company actions reflecting
government efforts will be necessaryicuig and fuel mix); government
companies' particular circumstance (iacloperating or maintenance of nuclear and
laws, regulations and policies favorn th uluiization and delivery infrastructure for
supplies
hydroelectric plant generating capacit; adequate
and the full benefits of energy
natural gas; economic incentives frrenewables;
Since individual companies face different
efficiency anid DSM as well as offset projects.
not apply to companies individually.
circumstances, the voluntary reduction gal does
exceed this goal. And, as an industry, we
Some companies individually may be ale to
However, the achievement of any goal
may be able to achieve a higher goal in the future.
affecting our industry's fuel mix, and
is dependent upon market-driven forces
government laws and policies.
IndiiulCmayAtvte steCresoe.
has strongly recommended that member
In order to reach the President's gll EEl
specific activities to reduce, avoid or
companies focus on quantitative, conreeand
sequester GHGs.
member companies may enter into
once the umbrella MOU is completed, individual
pledged in these documents will include
company agreements with DOE. A ctivities
as a member of EEI, NEI, EPSA or
individual company actions - whetlkr undertaken
(see discussion below).
anj other group - and joint, industry-wde initiatives
be the Power Partners Resource Guide,
Supporting individual company actions will
and demand-side options for companies to
which will set forth a panoply of sply-
GHGs. Among these activities will
consider in order to reduce, avoid3 adsequester
coal technology generation; additional
likely be: additional natural gas and clean
utilization, upratings and plant restarts)4
nuclear generation (through increase capacity
DSM; additional offset projects (e.g., tree
additional renewables, energy efficiec ad
5 projects and international projects); and
planting and forest management, methane
in Enclosure I to this letter.
2The critical area of government policies is addressed
See EPSA letter of January 10, 2003, to you.
4 See NEI letter of December 23, 2002,
tofou
4-5 million metric tons
The forecast for carbon sequestered inth U.S. through power sector activities is in
activities by the power sector are likely to result
of CO, in the next decade. International sequstration
similar numbers of sequestered tons.

4. The Honorable Spencer Abraham
January 17, 2003
Page 3
(e.g., additional natural
additional actions related to compliance with new air regulations
gas and less coal generation).
... .uppeete yIdutyIitaie
In addition to individual compn cinwih are the cornerstone of Power Partners s
in industry initiatives.
voluntary programs, EEI mebrcopneswl also participate
six headed by EEl and two led
Our industry currently has eight initiaties underway, with
6
by EPRIL
Other Actions
in conjunction with our EPICI idsIallies and federal agency partners, EEI also plans
SMatiiien
inutr
to issue an interim report that examines the progress of Power Partnerssatviis n
by member companies,
will seek to identify additional actions~that could be undertaken s
individually and collectively, to help meet the President's goal.
in Power Partners
Furthermore, EEI will strive to obtain full company participation
87 percent of EEI member
Companies currently participating comprise more than
company generation.
other agencies as part of the
We appreciate the opportunity to work with DOE and
look forward to participating in
Administration's Energy Partners for Climate Action, and
the kickoff event in Washington, D.C.
Sincerely,
Thomas R. Kuhn
TRK:lsf
Enclosures (2)
cc (w/ encs):
Hon. Christine Todd Whitman
Administrator
Environmental Protection Agency
Hon. James L. Connaughton, Esq.
Chairman
Council on Environmental Quality
this letter.
6The cur-rent forecast for these initiatives is contained in Enclosure 2 to

5. The Honorable Spencer Abraham
January 17, 2003
Page 4
Hon. Robert G. Card
DOE Under Secretary for Energy, Science and Environment
Hon. Vicki A. Bailey
Assistant Secretary
DOE office of Policy and International Affairs
Barton Marcois
Principal Deputy Assistant Secretary
DOE office of Policy and International Affairs;
Larisa Dobriansky, Esq.
Deputy Assistant Secretary
DOE office of Policy and International Affairs
Philip A. Cooney, Esq.
Chief of Staff
Council of Environmental Quality

6. The Honorable Spencer Abraham
January 17, 2003
Page 5
bee (w/ enes):
All CEOs
Environmental EAC
GCC Subcommittee
Washington Representatives
Power Partners representatives
BET GCC Issue Team

7. Enclosure 1
for the power sector is the
One key to the success of voluntary climate programs
Overall, increased support for
implementation of appropriate government policies.
or practices - such as renewables,
,emissions-free or less fossil fuel-intensive tbchnologies
and demand-side management
clean coal technologies, natural gas, and enprgy efficiency
- can help drive down greenhouse
gases(Hs)
infrastructure are
* Access to natural gas supply adntrlgas transportation
critical.
that the Department of Energy's
• We are heartened by the annunemntlast fall
carbon sequestration will be
nearly $50 million of annual suppor for geological
increased up to $90 million.
also be helpful.
* Funding for international power poects would
the following are necessary to help
With regard to changes in policies and regulations,
directly or indirectly decrease GHGs:
* Hydroelectric relicensing reform.
* Nuclear power plant licensing extenisions.
under th Clean Air Act (in order to
* Reform of the new source review rgulations
thereby decrease GHGs).
facilitate improvement of power pln efficiency and
(which would ease
* Transmission siting authority for te federal government
seriously constrained transmission capacity in the
U.S., which has required
additional generation or power plans).
section 1605(b) are critical to
Reporting reforms under Energy Policy Ac:t (EPAct)
February 14 presidential statement
industry participation in voluntary prograi us. The
credit and not penalizing those
articulated these reforms as the award of transferable
future climate policy (which some have
taking voluntary measures for their action's under
the July 8, 2002, four-agency letter
characterized as "baseline protection"). 1it addition,
previously reported under the
to the President recommended a placehol~ler for activities
EPAct section 1605(b) guidelines.
GHGs include accelerated
Government tax policies that would assist in reducing
equipment. Other important financial
depreciation and amortization of pollutio control
- such as wind, biomass and
incentives include production tax creditsKo renewables vehicles.
cell
solar energy - and tax incentives for hybrid and fuel

8. Enclosure 2
Contibuion fro E~ an EPRI Industrv-wide Initiatives
initiatives is as follows:
The current forecast for FEI's industry
carbon
mfIfh as 2 million metric tons of
* ForestTree Carbon Company: As projects.'
sequestered over the lifetime of the
dioxide (CO2) are expected to be
This partnership with the Environmental
*Coal Combustion Products Partnersip: of coal combustion products, and
luse
Protection Agency will increase the million
C902 avoidances from the current 16
therefore is projected to increase annually.
30 million metric tons Of CO 2
metric tons Of C02 to as much as
with the Department of
*international Power Partnerships: T his partnership tons Of
or sequester 1.8-18 million metric
Energy (DOE) could reduce, avoid depending
( GHs) annually from 2002-2010,
CO 2 -equivalent greenhouse gases n rjcs
and member compan netet
on government (DOE) funding of,
Of abandoned mine lands:
iitiaive on indbioass, and restoration
Thee
as resl fteernwbe n
Tons of GHGs reduced, avoidedo01 sequestered are developed, but are
until projects
restoration initiatives are uncertain
potentially high.
roadmap initiatives: These
EPRI's carbon capture and storage and climate technology are unlikely to yield
and depoyent programs
long-term, research, development in the short to medium term,
significant tons of GHGs reduced, avoided osequesteredis high.
GHGs in the long term
but their potential for addressing
two workshops on revision of the
'The Department of Agriculture this month is holding carbon
guidelines that may address unresolved
Energy Policy Act section 1605(b) a larger number of sequestered tons
sequestration accounting issues, such as reporting
during the early years of projects.