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Groups React to Utility MACT Disapproval Resolution

Following last week’s introduction by Senator Jim Inhofe of a disapproval resolution regarding EPA’s Utility MACT rule, a number of groups have stepped forward to offer comments on the senator’s efforts. Among these are organizations are the US Chamber of Commerce, Industrial Energy Consumers of America, the National Association of Manufacturers, the Western Business Roundtable, the American Coalition for Clean Coal Electricity, and the 60 Plus Association. PACE published its own statement late last week.

“This may be our only opportunity to secure meaningful Senate debate on Utility MACT and to upend EPA’s unreasonable compliance deadline,” said U.S. Chamber of Commerce Executive Vice President for Government Affairs Bruce Josten. ”A successful Resolution of Disapproval is a strong remedy but would nonetheless allow EPA to issue new mercury-only emissions standards for power plants, and would allow Congress to address power plant mercury emissions through reasonable legislation.”

“Manufacturers are looking to Washington for policies to enable investment, growth and job creation, not more burdensome regulations from the EPA and other agencies,” said the National Association of Manufacturers in a written statement. “Sen. Inhofe’s effort to repeal the Utility MACT rule will help give manufacturers more certainty while stopping an extremely harmful regulation.”

“Utility MACT will have massive impacts on the nation’s economy and could negatively impact electricity reliability,” said Holly Propst, Executive Director of the Western Business Roundtable. “We are grateful for Senator Inhofe’s leadership on this issue and urge his Senate colleagues to join him in formally disapproving EPA’s action.”

Click below to read statements and letters regarding the disapproval resolution (listed alphabetically).

Statement from 60 Plus Association
Statement from American Coalition for Clean Coal Electricity
Letter from Caterpillar
Letter from Industrial Energy Consumers of America
Statement from National Association of Manufacturers
Petition for Review from National Black Chamber of Commerce
Statement from US Chamber of Commerce
Statement from Western Business Roundtable

Inhofe Set To Introduce Utility MACT Disapproval Resolution

According to a number of reports, Senator Jim Inhofe (OK) on Thursday, February 16th, will introduce a Resolution of Disapproval regarding EPA’s Utility MACT rule, finalized in December 2011. Under the Congressional Review Act, a resolution needs 30 supporters to be placed on the Senate calendar. If the resolution receives a simple majority in both chambers and is signed by the President, the joint resolution would nullify the Utility MACT rule.

As PACE has written about extensively, EPA’s Utility MACT rule is the agency’s most expensive regulation ever for power plants, imposing steep costs to the economy and endangering hundreds of thousands of jobs. The rule also threatens the reliability of U.S. electricity by resulting in the closure of a predicted 68 coal-fired plants that provide baseload power to American homes and businesses.

On December 21^st, Senator Inhofe announced his intention to file the disapproval resolution, issuing a statement that read, “Sadly, this rule isn’t about public health. It is a thinly veiled electricity tax that continues the Obama Administration’s war on affordable energy and is the latest in an unprecedented barrage of regulations that make up EPA’s job-killing regulatory agenda.”

Inhofe alludes to the fact that, although EPA refers to Utility MACT as a mercury rule, 99.98% of the Utility MACT benefits calculated by EPA are not a result of mercury reductions. Almost all of the $90 billion in benefits estimated by EPA by 2016 are generated by reductions in particulate matter already governed by agency rules.

“Utility MACT, as it has been designed by EPA, poses great burdens on our power generation sector with very questionable benefits,” explains Lance Brown, PACE Executive Director. “This resolution, if passed by Congress and signed by the president, can’t stop EPA from regulating mercury, but it can stop a bad piece of regulation from hurting the American people.”

Study Shows EPA Rules Will Cause Power Rate Hikes

A recent study by National Economic Research Associates (NERA) predicts what many, including PACE, have been saying for months: that new EPA rules will cause significant hikes in the price of electricity. The study, released in September 2011, finds that four major EPA rules will come with a total price tag of $127 billion through the year 2020.

The NERA study considers the cost of the EPA’s Cross-State Air Pollution Rule (CSAPR), Utility MACT, proposed coal ash regulations, and a new rule governing cooling water intake structures. The $21 billion annual price tag makes these rules the most expensive EPA has ever written for the electricity sector. The total cost includes an estimated $104 billion in capital costs to implement new environmental controls and replace lost capacity.

In addition to studying total costs from the rules, NERA also calculated retail electricity price increases in twenty-two regions of the country, finding that some regions could see price increases of as much as 16%.

The NERA study also found a pronounced impact of the EPA rules on the American economy, with the four rules costing an estimated 183,000 American jobs per year.

“While presidential candidates are engaging in rich debate about how to kick-start the American economy, it is becoming clear that one of the first steps must be to make sure EPA rules aren’t destroying jobs faster than U.S. businesses can create them,” said Lance Brown, PACE Executive Director. “We need national leaders to act quickly before energy consumers are saddled with double digit price increases on electricity.”

PACE Responds to State of the Union

In response to the president’s State of the Union address Tuesday evening, the Partnership for Affordable Clean Energy released an official statement detailing its concerns regarding energy affordability and reliability. An excerpt of that statement appears below.

“In his State of the Union preview, President Obama indicated his plans to lay out a ‘blueprint for an American economy that’s built to last.’ But unless that blueprint includes overturning recent regulations implemented by the Environmental Protection Agency, our economy will continue to suffer. While President Obama and the EPA continue to defend new rules – like Utility MACT – consumers can look forward to higher costs and less reliability.”

“Media reporting and commentary on environmental progress has overlooked glaring improvements in power sector emissions, leading the public to believe that American air is dirtier than ever when the exact opposite is true. If the president is truly serious about boosting the economy, his administration should reconsider implementing rules that will raise energy prices and cost millions of hard-working Americans their jobs.”

The president’s State of the Union address also included a number of soundbites on energy, including pledges to install renewable power on federal lands and to launch new initiatives to boost renewable power use in the military branch.

“Instead of focusing on common-sense initiatives that will lower the price of energy for Americans, the administration stubbornly continues to pursue renewable power experiments that make little sense in the current economic reality,” states PACE Executive Director Lance Brown. “If we’re going to move forward, we need energy policy based on reality rather than focus groups.”

Groups to Sue EPA Over Coal Ash

According to multiple sources, a number of environmental groups have announced plans to sue the Environmental Protection Agency (EPA) over standards for the treatment of coal ash. The lawsuit will be filed under the Resource Conservation and Recovery Act, or RCRA.

Coal ash, a natural byproduct of the combustion process for coal-fired power plants, today is typically stored onsite at power plants or sold on the open market for use in the production of concrete and other materials. In 2010, EPA proposed a pair of regulatory approaches for dealing with coal ash, one under RCRA Subtitle D that states could adopt at their discretion and another under the hazardous waste Subtitle C that would place coal ash under a federally enforceable permitting program.

“The type of lawsuit has become pattern in practice for environmental groups whose real goal is to shut down fossil power in the United States,” explains PACE Executive Director Lance Brown. “The most stringent coal ash proposals could endanger the very viability of half the nation’s power production capacity. The EPA, seemingly unconcerned with reliability or cost issues, welcomes such lawsuits.”

Groups reported to have announced their plans to file suit are Earthjustice, on behalf of Appalachian Voices; Chesapeake Climate Action Network; Environmental Integrity Project; French Broad Riverkeeper; Kentuckians For The Commonwealth; Moapa band of Paiutes; Montana Environmental Information Center; Physicians for Social Responsibility; Prairie Rivers Network; Sierra Club and Southern Alliance for Clean Energy.

PACE has written extensively about coal ash regulation, citing a study published in June 2011 that found EPA’s regulatory proposals on coal ash could cause as many as 316,000 job losses and cost $110 billion over a 20-year period. A documentary released last year by PACE, entitled Unplugged, also deals with the coal ash issue, citing officials with TVA and elsewhere who fear that classification of coal ash as a hazardous waste would severely restrict options for coal ash storage, causing either the retirement of some coal-fired facilities altogether or a drastically higher cost for burning coal for electricity.

“The public needs to understand that half of the 130 million tons of coal ash being generated each year ends up in places like our roads and our carpet. The rest is being stored under close supervision,” says Brown. “There is a way to handle coal ash that protects the public while not taking half of America’s power generation off the grid. Let’s hope the courts and policymakers have the wisdom to acknowledge that fact.”

Tea Party Weighs in on EPA Greenhouse Gas Regs

In a letter sent last week to EPA Administrator Lisa Jackson, the Georgia Tea Party outlined its concerns over the agency’s move to regulate greenhouse gases. Specifically, the Tea Party argues that EPA proposals to regulate greenhouse gas emissions from utilities “exceed the authority of that agency and, in fact, are a misapplication of the Clean Air Act.” The letter was also sent to members of Georgia’s congressional delegation.

“If implemented, these regulations would impose compliance costs reaching hundreds of billions of dollars that utilities would have to pass on to the consumer,” explains Georgia Tea Party board member Patti Gettinger. “This would have a devastating affect on the economy and particularly on low income and fixed income families throughout the country.”
(Read the Georgia Tea Party’s full press release here.)

EPA’s move to regulate greenhouse gas emissions stems from a 2007 Supreme Court case in which twelve states, including California and New York, argued successfully that EPA should be forced to regulate carbon dioxide and other greenhouse gases as pollutants under the Clean Air Act. Having missed its original regulatory deadline of July 26, 2011, EPA is now aiming to implement such regulations by May 26, 2012.

“In combination with other EPA proposals such as Utility MACT, the Cross-State Air Pollution Rule, and coal ash regulation,” the Tea Party’s letter explains, “the proposal to regulate greenhouse gas emissions from the utilities provides yet another piece of evidence that your agency has lost sight of environmental protection and is focused instead on eliminating coal from America’s energy mix.”

“The Georgia Tea Party has made a clear case that EPA’s action to regulate greenhouse gases will make energy in the U.S. less accessible and more expensive,” says PACE Executive Director Lance Brown. “We encourage others with similar concerns to make their voices heard while there is still time.”

CSAPR On Hold for Now

On Friday, December 30^th, the U.S. Court of Appeals for the D.C. Circuit ruled to delay EPA’s Cross-State Air Pollution Rule (CSAPR) until its legal merits could be determined. The EPA rule was scheduled to take effect in January.

The ruling has particular importance for Texas, one of twenty-seven states affected by the rules. Following the court’s ruling, several Texas leaders applauded the decision to delay CSAPR indefinitely.

“The Texas Attorney General’s Office will pursue every available legal remedy to prevent the EPA from imposing its cross-state air pollution rule, and the electricity disruptions and blackouts that state utility officials have said this rule will cause,” said Texas Attorney General Greg Abbott said in a statement.

Texas Governor Rick Perry also weighed in with his own statement, saying, “”The court was right to stay this highly flawed, job-killing rule that was based on inaccurate and incomplete information.”

View the court’s ruling here.

PACE Reacts to Finalized Utility MACT Rule

This week, EPA Administrator Lisa Jackson publicly released the finalized Utility MACT rule – a move that represents the agency’s first national standard for air pollutants from power plants, and its most expensive rule to date. PACE Executive Director Lance Brown issued the following statement in reaction to the rule.

“I am incredibly discouraged that – even with all the troubling information that has been brought to light since its introduction – the EPA moved forward in finalizing its controversial Utility MACT rule. I – along with a diverse group of elected officials, federal regulators, power suppliers and grid operators – have highlighted how the rule stands to put significant stress on consumers, local and national economies, and the reliability of the power grid, but our concerns have been repeatedly ignored by the EPA and the Administration. In fact, a recent Associated Press survey found that “more than 32 mostly coal-fired power plants in a dozen states will be forced to shut down and an additional 36 might have to close because of new federal air pollution regulations.”

“In moving forward with this burdensome rule, the Administration is choosing to turn a blind eye to its own Executive Order issued in January 2011 stating that the regulatory system must promote economic growth, job creation, and predictability while reducing uncertainty. The EPA has estimated the rule’s cost at nearly $11 billion annually, and numerous studies have shown it will result in the loss of more than one million jobs in the next decade. Even worse, consumers can now look forward to electricity bill increases well into the double digits, adding significant economic burden to those households already struggling to make ends meet.

“At the very least, the EPA should have recognized recent emissions improvements before implementing a rule with unrealistic deadlines for compliance. The end result will restrain domestic energy, endanger jobs, and saddle consumers with higher power bills.”

House Oversight Leaders Hammer Administration on Utility MACT Concerns

In a letter sent last week, Darrell Issa, Chairman of the U.S. House Oversight and Government Reform Chairman, and Jim Jordan, Chairman of the Subcommittee on Regulatory Affairs, Stimulus Oversight and Government Spending, expressed their serious concerns about the effects of EPA’s Utility MACT rule on national grid reliability and the American workforce. The letter was sent to Cass Sunstein, the Administration’s chief official over regulatory affairs.

“We continue to be concerned that EPA failed to perform a proper analysis of the rule’s impact on job creation, consider the rule’s impact on grid reliability, or adequately review all of the comments submitted for this rule,” the letter states. The letter asks that Sunstein’s office “immediately return the Utility MACT rule to EPA” and require that EPA and FERC complete a full assessment of the rule’s impact on grid reliability. [Read the full letter here.]

With EPA expected to release a final version of its Utility MACT rule this week, a number of details have surfaced that suggest EPA did not work cooperatively with FERC to study reliability issues related to the rule. The letter from Chairmen Issa and Jordan, for example, quotes an email from a FERC employee.

“As it has done in other responses, EPA continues to make a lot of assumptions and does not directly answer anything associated with local reliability,” wrote David Kathan, an employee with FERC’s Office of Energy Policy and Innovation. “They provide the standard response that there will be enough time and they are confident that regional processes will accommodate any local capacity deficiency problem early in the process, or they do not respond directly to the question.”

PACE will provide news and analysis of EPA’s final Utility MACT rule when it becomes available to the public.