May
01
2017

EPA Postpones Costly ELG Rule

Earlier this month, the EPA requested that ongoing litigation for its Steam Electric Power Generating Effluent Guidelines (ELG rule) published by the Obama administration in November of 2015 be suspended for six months. Just this past week, the United States Court of Appeals granted this motion and agreed to hold the lawsuit in abeyance until August 2017.

The ELG rule aimed to place more stringent standards on effluent or wastewater limitations from power plants. How costly was the rule? The EPA estimated the measure to cost $480 million per year and have a reported average cost of $1.2 billion per year during the first five years of compliance. Under the leadership of new Administrator Scott Pruitt, the EPA has issued a stay on the rule, postponing compliance until the lawsuit is settled.

“This action is another example of EPA implementing President Trump’s vision of being good stewards of our natural resources, while not developing regulations that hurt our economy and kill jobs,” says EPA Administrator Scott Pruitt.

The ELG rule mainly targeted coal-fired power plants of 50 megawatts or more, which would have affected as many as 500 power plants in the United States. In response, industry groups filed suit a lawsuit, Southwestern Electric Power Co., et al v. EPA, that alleged that EPA greatly underestimated the overall costs of compliance. A number of voices, including the Edison Electric Institute, the National Rural Electric Cooperative Association, and the American Public Power Association, also claimed that the costs from the ELG rule would result in job losses.

The cost of the rule would certainly have been high. For example, NRG Energy expected its costs to be around $200 million. American Electric Power faced even higher costs, with estimates ranging between $400 and $550 million. Smaller, local utilities may have had to pay even more in relation to their lower numbers of rate payers.

“Some of our nation’s largest job producers have objected to this rule, saying the requirements set by the Obama administration are not economically or technologically feasible within the proscribed timeframe. It is in the public’s best interest to reconsider the rule and assess the wide-ranging and sweeping objections that the agency received,” explained EPA Administrator Pruitt.

The delay of the ELG rule is a win for power producers and consumers. Rolling back costly regulations such as this one will ensure that low-cost, reliable power continues to remain available to the families and businesses who depend on it.