Concerns over climate change, and the prospect of limits on greenhouse gases, recently prompted major banks to add to stricter emissions standards to any financing for coal-fired power plants. Now those same worries are complicating public financing for rural electric cooperatives, which get 80 percent of their power from coal.
"The federal government is suspending a major loan program for coal-fired power plants in rural communities, saying the uncertainties of climate change and rising construction costs make the loans too risky," reports Matthew Brown of The Associated Press.
Since 2001, $1.3 billion in loans had been issued for new plant construction, but "none will be issued this year and likely none in 2009, James Newby, assistant administrator for the Rural Utilities Service, a branch of the Department of Agriculture, said Tuesday," Brown writes. Projects in Arkansas, Illinois, Kentucky and Missouri had been seeking a total of $1.3 billion in loans at the time of the suspension. (Read more) We reported on cancellation of the Missouri plant yesterday.
UPDATE, March 13: Steven Mufson of The Washington Post catches up, and expands, on the story. To read his report, click here.
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