Monthly Archives: July 2015

Coal Related News from Around the Nation

GUEST COLUMN: EPA Plan Will Lead to Fewer Jobs, Higher Rates

Via The Lufkin Daily News:

Texas’ balanced energy portfolio is what drives our state’s economic growth and provides job security to millions of Texans.

Texas energy jobs aren’t just in oil fields, mines and power plants. The affordable electricity rates provided by our diverse energy supply ensure that other employers, such as those in our vast manufacturing and technology industries, maintain and grow their operations in Texas. Our diverse energy mix also keeps residential electricity bills low, ensuring that more money stays in the pockets of hardworking Texans.

 This growth and prosperity is being put at risk by the Environmental Protection Agency. Coal, which provides more than a third of the state’s electricity generation, faces the greatest risk. Its share is decreasing due to unwise, far left environmental policies from Washington.

 EPA has taken direct aim at Texas, imposing burdens far greater than any other state. The “Clean Power Plan,” (CPP) a proposal announced last June by EPA, would require a 38 percent reduction in Texas’ carbon dioxide emissions from power plants by 2030. Though Texas’ carbon dioxide emissions rate is lower than the national average, EPA is attempting to force Texas to shoulder a disproportionate share of the nation’s reductions, which will be greater than those of 27 other states combined.

 EPA has predicted that over half of Texas’ coal generation will have to be shut down under the CPP, with plant closures across the state. What does this means for Texas? Lost jobs, higher electricity rates and greater chances of rolling blackouts.

 A 2014 University of North Texas study found that the Texas coal industry provides a total economic benefit of more than $7 billion annually, supports over 24,000 jobs that pay over $1.8 billion, and contributes more than $690 million in state and local taxes. Losing those economic benefits is only the tip of the iceberg of the impact of EPA’s rules on the Texas economy, however, as the biggest economic impact will come in the form of higher energy bills.

 By 2020, EPA’s rules are projected to increase annual power and gas prices in Texas by $42 billion and nationally by $284 billion. This will lead to a 54 percent increase in household electricity and gas bills, forcing the average Texas household to spend an additional $1,050 per year on electricity and gas. The impact to large consumers of electricity will be much more dramatic, especially in the manufacturing and petrochemical sectors of the Texas economy.

 The CPP will fail to provide any meaningful benefits to the U.S. or Texas. President Barack Obama has pledged to reduce U.S. carbon dioxide emissions by 26-28 percent by 2025, which he claims prompted China’s pledge to peak skyrocketing carbon dioxide emissions by “around 2030.” While advertised by the administration as a major step forward, China and the rest of the developing world will continue to increase carbon emissions so that reductions here will be dwarfed by increases abroad. In fact, by 2030, all of the projected CPP emission reductions will be offset by Chinese emissions in just 131/2 days.

 We do not want to return to rolling blackouts or large-scale outages, as we saw in Texas in February 2011, when a mix of a severe arctic blast and a sharp rise in electrical demand forced ERCOT to initiate rolling blackouts temporarily.

 We cannot control the weather. But we can control policy.

 Affordable and reliable electricity is the backbone of Texas’ economy and our economic prosperity is contingent upon the adoption of sensible policies that maximize the use of our state’s abundant, diverse and affordable energy portfolio, including oil, natural gas, coal and renewables. This balanced portfolio, based on free market principles and a sound regulatory framework, is critical to Texas’ continued profitability, competitiveness and economic success.

 President Obama’s unworkable CPP would be economically disastrous for Texas and poses very real electric reliability concerns. Letting Washington bureaucrats decide how Texas generates electricity will have catastrophic consequences. The Clean Power Plan is all pain, no gain.

Mike Nasi is the General Counsel for Balanced Energy Texas, a statewide coalition of energy consumers, producers and providers, committed to supporting policies that preserve and promote our state’s leading role in energy and economic development.

See the article here.

Pennsylvania Leaders Must Reject California-cation of Power Grid

Via ydr.com:

The idea of Pennsylvania doing things “the California way” doesn’t make much sense. Unfortunately, Pennsylvanians may not have a choice if the Obama administration has its way.

The U.S. Environmental Protection Agency (EPA) will soon finalize the “Clean Power Plan,” requiring states to reduce carbon dioxide emissions by 30 percent by 2030. To meet these drastic reductions, which will have no impact on global temperatures, every state, including Pennsylvania, will have to impose California-style taxes, manipulate markets, and enforce short sighted mandates — the same policies that have contributed to the Golden State’s sky-high energy prices and persistently high unemployment. Take it from a native Californian and former official with the California Energy Commission: you don’t want our energy policies.

In 2006, California passed its landmark energy mandate requiring citizens and industry to reduce greenhouse gas emissions to 1990 levels by 2020. Center to the law is California’s cap-and-trade system, a costly carbon-trading scheme that is the stuff of Enron’s dreams. Another piece is California’s renewable electricity mandate, which requires utilities to purchase 33 percent of their electricity from unreliable sources like wind and solar by 2020. This regulatory system is tortuous. California’s Database of State Incentives for Renewable Energy counts 200 different state programs in California that mandate or subsidize renewable energy production. That’s on top of the 28 federal programs that further inflate California’s renewables industry and raise consumer prices.

These programs were supposed to “drive long-term investment” in wind and solar. Instead, California’s green energy dream has turned into a nightmare. Residential electricity prices are 40 percent higher than the national average and eighth highest in the nation. Expensive energy also contributes to California’s stubbornly high unemployment rate, which at 6.3 percent sits a full percentage point higher than the national average.

Additionally, California suffers from an increasingly unreliable electric grid. California’s grid operator has warned that, with less generation from conventional sources and more from unreliable renewable sources, “the system becomes increasingly exposed to blackouts when generation or transmission outages occur.”

Despite these ill effects on the economy and the power grid, EPA and national environmental groups think policymakers in Sacramento got it right. They say California has a head start on EPA’s grid of the future. However, these observers fail to realize that California’s foolish policies make even less sense for the rest of the country.

First, California is blessed with mild temperatures, so heating and cooling expenses take less of a toll there than most other places in the U.S. Second, California currently imports much of the reliable power it needs. If Pennsylvania and every other state in the country imposed California’s regulatory scheme, we would run out of places to produce reliable electricity. Third, California’s economy does not support energy-intensive manufacturing. Part of the reason the manufacturing industry — and the jobs it supports — left California in the first place is its higher energy costs. But despite California’s failures, Washington hasn’t learned a thing. The “Clean Power Plan” calls on states to craft their own compliance plans, and EPA pretends it’s offering them flexibility. But the rule is so strict that, in reality, EPA is forcing states to impose some mix of California-style capping, taxing, and mandating.

The EPA hails California as a model for the nation, but it’s more like a cautionary tale. States that choose to comply will become accomplices in EPA’s plan to export California’s failed energy policies nationwide, and with predictable results — higher costs, less reliability, and lower standards of living. States that aren’t interested in this outcome should reject the EPA’s demands to submit compliance plans. If policymakers in Harrisburg come up with the same answers as those in Sacramento, they’re asking the wrong questions.

Tom Tanton is director of the Energy and Environmental Legal Institute and Senior Fellow with the Reason Foundation. He formerly served as principal policy adviser at California Energy Commission.

See the article here.

More States Threaten To Veto EPA’s Global Warming Rule

Via The Daily Caller:

Mississippi has become the latest of a growing number of states to suggest it might not enforce a major EPA regulation to limit carbon dioxide emissions at existing power plants — joining at least six other states already threatening to not enforce the rule.

“We do not see how it will be possible to reasonably develop a State Implementation Plan [SIP] given the burdensome requirements of EPA’s proposal in its current form,” Mississippi Republican Gov. Phil Bryant wrote in a letter to the EPA last week that was first posted online by Bloomberg BNA.

“The flaws inherent in EPA’s proposal make the development of responsible SIPs unworkable for states, including Mississippi,” Bryant added. “One of my most important duties as governor is to secure reliable access to affordable electricity for Mississippians. I am deeply concerned that the current form of EPA’s proposal could prevent me from fulfilling this duty.”

Bryant’s letter to the EPA reflects an increasing sentiment among Republican governors who worry the agency’s power plant rule will harm grid reliability and increase energy prices. If Mississippi opts not to enforce the EPA’s carbon rule, it could be subject to federal intervention.

 

Governors from West Virginia, Wisconsin, Indiana, Texas and Louisiana have suggested they may not enforce EPA’s rule to limit carbon dioxide emissions from power plants 30 percent below 2005 levels by 2030. Oklahoma has officially decided it will not enforce EPA’s rule.

 

“President Obama and the EPA are fighting a politically charged war against utility consumers across the country,” Oklahoma Gov. Mary Fallin said on her issuing of an executive order to block the implementation of the EPA’s power plant rule. “While the environmental benefits of these regulations will be minimal, the economic devastation of these overreaching and unrealistic regulations will be very real.”

 

For months, Senate Majority Leader Mitch McConnell, a Kentucky Republican, has been encouraging states to not enforce the EPA’s so-called “Clean Power Plan” until the matter has been sorted out in the courts. Implementing the Clean Power Plan prior to this could leave states heavily invested in a rule that could be struck down as unlawful.

 

“Don’t be complicit in the administration’s attack on the middle class,” McConnell wrote in March. “Think twice before submitting a state plan — which could lock you into federal enforcement and expose you to lawsuits — when the administration is standing on shaky legal ground and when, without your support, it won’t be able to demonstrate the capacity to carry out such political extremism.”

The courts have already rejected the first challenge to the Clean Power Plan by a group of states and a coal company because the agency had not finalized the rule yet. The EPA is expected to finalize the Clean Power Plan next month, and officials expect legal challenges to be filed once the rule is promulgated.

 

The EPA has warned that states that don’t submit implementation plans would be put under a federal one — thus putting their state’s environmental agenda under federal control.

 

“We hope that every state will feel it’s in their best interest to develop their own plan,” EPA Acting Assistant Administrator Janet McCabe told reporters in a January press call. “We do have an obligation under the Clean Air Act to have a federal plan available should there be states that don’t submit plans.”

 

While the EPA and environmentalists have warned that states could lose out if they don’t implement their state plans, others have pointed out the EPA doesn’t actually have the authority to enforce some aspects of the Clean Power Plan.

 

Last year, Oklahoma Republican Sen. Jim Inhofe questioned EPA Chief Administrator Gina McCarthy about how the EPA would be able to enforce aspects of the Clean Power Plan. Inhofe’s conclusion was that the EPA did lack the authority to force states to increase natural gas and green energy use.

 

“Sorry to interrupt, but you are proposing a rule that you do not have the authority … to enforce today,” Inhofe told McCarthy during a hearing last year.

 

“No, I believe we have clear authority to do the rule as we’ve proposed it,” McCarthy responded. “I don’t think we’re expanding our authority with this rule, sir, no.”

 

“Well, it appears to me you are,” Inhofe said.

See the article here.

New EPA Clean-air Rules Threaten Rural Power CAo-ops

Via AZCentral.com:

By this fall, the federal Environmental Protection Agency is expected to march the nation’s energy consumers into new territory on the frontier of controlling carbon emissions.

Representatives of the big power companies are flooding Washington, D.C., in a desperate effort to mitigate the impact of the EPA’s venture, known as the Clean Power Plan.

Debates between environmental activists and politicians over its implications are heating up.

But few have looked at the EPA’s new carbon plan with quite the riveted sense of alarm as small utility companies that serve rural customers.

The president of a small cooperative serving rural customers in Arizona, New Mexico and Nevada is blunt about that impact:

“The people throughout rural Arizona that we serve will be screwed more than anybody else in the country,” Patrick Ledger, CEO of the Arizona Generation and Transmission Cooperatives, told the Environment and Energy news service.

Unless the EPA’s plan includes substantial revisions, Ledger is not exaggerating.

His energy co-op, serving some 500,000 rural customers, operates one natural-gas-fired and two coal-fired units at the Apache Generating Station in southeastern Arizona.

One of the coal-fired units is scheduled to convert to gas in 2018 to accommodate recent EPA rules governing haze. But under the draft plan proposed by the EPA, the co-op would be forced to shutter its coal-fired unit altogether, stranding around $230 million in recent upgrades and investment.

In addition, the co-op would have to take on between $450 million and $600 million in additional debt to rebuild capacity to serve its customers.

All told, that would push the price of the energy Ledger’s cooperative sells to distributive cooperatives to 38 percent above market rates. And that, says Ledger, spells the end.

“We will be put out of business,” Ledger told the Republic editorial board last week. “We go into bankruptcy.”

Arizona Generation’s debt is owed to another federal agency. Repeat this story with multiple rural co-ops, and taxpayers will be stuck with an enormous bill.

Ledger and his colleagues understand that coal’s future is limited, so they are lobbying the EPA to give the nation’s 100 smallest utilities more flexibility in meeting the carbon goals.

Ledger doesn’t hold much hope for that, so he’s also working with Arizona’s other utilities. This state faced the most ambitious goal to reduce carbon under the draft plan; utilities are urging the EPA to give them a longer glide path to ease the transition away from coal.

Concerns over enormous amounts of stranded debt is a near-universal one as the Clean Power Plan approaches.

Arizona’s major utility companies, including Salt River Project and Arizona Public Service Co., recently invested hundreds of millions of dollars to bring their coal-fired plants into compliance with existing EPA regulations.

Much of that investment will be lost if the EPA does not revise the draconian carbon reductions written into the Clean Power Plan, much of which the agency expects to occur no later than 2020.

A battle among giants, the debate over the Clean Power Plan is scarcely considering the dire consequences for little-guy energy providers like the Arizona Generation and Transmission Cooperatives.

It needs to start.

See the article here.

Martin: EPA Plan Would Devastate Wyoming’s Economy

Via The Casper Star-Tribune:

Each year, Wyoming’s coal industry delivers more than $1.1 billion into the state’s coffers. That critical funding helps pay for everything from roads to schools. But the state’s economic health could be in peril if the U.S. Environmental Protection Agency gets its way.

The EPA, under the guise of cleaner air, has proposed a sweeping carbon reduction mandate, called the Clean Power Plan, that if approved would sap needed revenue out of the state, drive up electricity prices and raise the cost of living. The plan aims to reduce carbon emissions from the nation’s electricity sector 30 percent by 2030.

Under the EPA’s mandate, Wyoming’s electricity rates — some of the most affordable in the country — could jump 28 percent. And since the CPP targets coal consumption across the country, reduced mining in the state could mean lost jobs and lost tax revenue. The impact could be similar to the darkest days of the Great Recession, when businesses across the state closed and the unemployment rate doubled.

Sometimes economic trouble and jumps in energy prices come from factors beyond our control — think of a rise in the price of gasoline because of turmoil in the Middle East — but the economic harm caused by the CPP will be self-inflicted. As we all know too well, bad policy decisions made by bureaucrats in Washington can have painful real-world impacts.

Tax revenue and mining jobs aside, a jump in electricity prices — especially of the magnitude expected — could be devastating. While no one wants to see a higher energy bill, it’s low-income folks, including so many seniors on fixed incomes, who suffer the most.

A recent study from the Kaiser Family Foundation found that one in seven seniors is now living in poverty. For the 70,000 folks in Wyoming over the age of 60, many of whom rely on Social Security to get by, higher costs for necessities like electricity could mean choosing between paying the electric bill and buying needed medications.

As a representative for 7.2 million seniors nationwide — including more than 15,000 in Wyoming — I hear firsthand their struggles. For the sake of seniors, and every American, we should be working on ways to reduce the cost of living, not artificially raise it. While building a more efficient and cleaner energy mix is a laudable goal, federal energy regulation, never voted on by our elected officials in Congress, is the wrong approach.

Fortunately, the CPP — perhaps better called the costly power plan -– remains under review. Speak up while you can and tell Gov. Matt Mead to join other like-minded governors across the country to simply say no to the EPA’s directive. Elected officials from 32 states have expressed serious concerns about the costs of the CPP and how it might affect reliability of our electric grid. This sweeping, costly energy mandate is a mistake Wyoming can’t afford.

See the article here.

Colorado Should Fight EPA’s Carbon Emissions Power Grab

Via Complete Colorado:

When the U.S. Supreme Court remanded the Environmental Protection Agency’s (EPA) Mercury and Air Toxics Standards recently, it set a clear precedent that costs matter and that the EPA does not have a blank check on the wallets of energy consumers. The EPA’s claim that the $10 billion pricetag was “irrelevant” failed to withstand judicial review.

The ruling is not likely to deter the EPA from finalizing its even more costly regulations on carbon emissions from coal plants this summer. Thus, states must be ready to ask the courts to block the implementation of a regulatory scheme that, according to independent economic consultants, will cost energy consumers up to $479 billion, likely the most expensive in the history of the Clean Air Act.

But they will accomplish only a minute reduction of worldwide carbon emissions.

The rules will, however, produce double-digit electric rate increases in Colorado, according to NERA Economic Consulting. Rural Colorado — with mines already facing shutdown because of decisions and policies that push the envelope of climate activism — will suffer economic devastation. Jobs paying average wages and benefits exceeding $122,000 annually will be destroyed.

And Colorado, which at one time ranked second only to Wyoming in the payment of federal coal royalties, will lose an important source of revenue for public schools and governments. Clean coal, which meets 60 percent of the state’s electricity needs, would be displaced by more expensive sources.

The rule fundamentally alters the way that states provide electric power through a series of “outside the fence” measures that the EPA itself lacks authority to implement. These include unrealistic directives to significantly expand the use of renewable energy and natural gas. It is this expansion of federal power, however, that may prove to be the rule’s ultimate undoing. In its mercury rule decision, the Supreme Court challenged the EPA’s claim to deference in the agency’s interpretation of the Clean Air Act. The EPA’s scheme to restructure the nation’s electricity grid through the carbon rules will likely raise additional arguments on the degree to which courts should accept agency interpretations of law.

Thus, it comes as no surprise that more than 30 states have questioned the legal basis for the EPA’s sweeping changes, and many are planning to file suit. Colorado must do the same. We cannot afford to rely on past assurances. Once the rules become final, Colorado must join other states in asking the courts to stop its implementation pending appeal.

The court only acted on the mercury rule after power plants had spent billions on unnecessary controls. The stakes are even higher here. Staying the rules will remove the EPA straitjacket, and avoid saddling Coloradans with higher rates, shuttered plants and a shattered economy.

Stuart Sanderson is president of the Colorado Mining Association.

See the article here.

Gov: Mississippi Might Not Comply with Climate Rule

Via The Hill: 

Mississippi Gov. Phil Bryant (R) has told the Environmental Protection Agency his state might not comply with a forthcoming Obama administration rule on carbon emissions from power plants.

“We do not see how it will be possible to reasonably develop a State Implementation Plan [SIP] given the burdensome requirements of EPA’s proposal in its current form,” Bryant wrote in a Thursday letter to EPA administrator Gina McCarthy.

Bryant said the EPA’s Clean Power Plan is an “unfunded mandate” that would require the state to build new energy infrastructure in order to bring down its carbon emissions. He complained that the proposed plan set more stringent emissions goals for Mississippi than other states and that it does not credit the state for reducing its emissions in previous years.
The letter also reflected concerns shared by many opponents of the Clean Power Plan, primarily that it could hurt electricity reliability or raise energy prices by forcing coal-fired power plants to shut down.

Bloomberg BNA first posted a copy of Bryant’s letter.

“The flaws inherent in EPA’s proposal make the development of responsible SIPs unworkable for states, including Mississippi,” Bryant wrote.

“One of my most important duties as Governor is to secure reliable access to affordable electricity for Mississippians. I am deeply concerned that the current form of EPA’s proposal could prevent me from fulfilling this duty.”

The Clean Power Plan, which the Obama administration is scheduled to finalize this summer, looks to cut emissions from existing power plants by 30 percent before 2030 by setting emissions reduction goals for states.

If Mississippi declines to write a plan to reduce its emissions, the federal government will write one for the state instead.

“Governor Bryant is deeply concerned about the Obama administration’s overreach and believes [the rule] is bad for Mississippi and bad for consumers in this state,” Bryant spokeswoman Nicole Webb said in a statement.

“He is weighing all available options before determining whether Mississippi will prepare a State Implementation Plan and hopes that the EPA will responsibly consider the concerns raised by Mississippi and other states.”

Mississippi legislators adopted a resolution this year opposing the Clean Power Plan, calling for the EPA and the Obama administration to either withdraw the proposal or water it down.

Several Republican governors have threatened to ignore the Clean Power Plan. Oklahoma has formally said it will not write its own implementation plan, and governors from West Virginia, Wisconsin, Indiana, Texas and Louisiana have said they might do so as well.

In a tweet, Senate Majority Leader Mitch McConnell (R-Ky.) said, “I applaud [Bryant] for standing against EPA overreach.”

See the article here.

”Just Say No to EPA”

Via The Logan Banner:

SAVANNAH, Ga. – Del. Rupert “Rupie” Phillips, D-Logan authored a resolution adopted by the Southern Legislative Conference (SLC) calling for member states to take action against the Environmental Protection Administration’s Clean Power Plan. The resolution was adopted on July 19 by the energy and environment committee at the four-day annual meeting in Savannah, Georgia.

“Through the Clean Power Plan, the EPA has once again produced another far-reaching, overly burdensome regulation. They’re continually tying the hands coal-producing states and the effects have been absolutely devastating for southern West Virginia.”

Del. Phillips added, “It’s time to draw a line in the sand. The EPA is pushing us around like they are a bunch of punks. I just want the states to stand together and say ‘no.’”

The adopted resolution states, “The Southern Legislative Conference of The Council of State Governments finds that EPA’s Clean Power Plan interferes with the sovereign powers of the states to regulate electricity within their borders and to ensure a reliable and affordable supply of electricity for their citizens. Therefore, The Southern Legislative Conference of The Council of State Governments urges State Attorneys General to take all legal actions after EPA issues its final Plan to prevent unlawful obligations from being imposed on states, electricity providers, businesses and citizens, up to and including, at each state’s discretion, refusing to submit Clean Power Plan implementation plans to EPA.”

Del. John B. McCuskey, R-Kanawha also attended the conference and supported the measure saying, “As we pass this resolution through the SLC, I am proud to stand with Delegate Rupie Phillips to push back against harmful federal overreach which unfairly targets the hard working men and women of our state’s coal economy. The people of our state don’t want anything extra, they just want a chance to compete, and it is our hope to ensure that these proud people are given the opportunity to continue to power America. The EPA needs to realize that the jobs lost due to their policies are not just statistics, these are real people, and their suffering is real.”

Several other delegates who attended the conference also supported the measure including Del. Gary Howell, R-Mineral; Del. Woody Ireland, R-Ritchie; Del. Joe Statler, R-Monongalia and Del. Mark Zatezalo, R-Brooke.

The Southern Legislative Conference is the largest of four regional legislative groups that operate under the Council of State Governments. It comprises the states of Alabama, Arkansas, Florida, Georgia, Kentucky, Louisiana, Mississippi, Missouri, North Carolina, Oklahoma, South Carolina, Tennessee, Texas, Virginia and West Virginia.

See the article here. 

Kentucky Wins a Battle, But War on Coal Ongoing

Via The Courier-Journal:

Kentucky has won a battle in the War on Coal. Last month, the U.S. Supreme Court decision said the Environmental Protection Agency violated the Clean Air Act when it issued burdensome new regulations on power plant emissions.

The justices held that EPA was required by law to take the costs of their regulations into account as a part of the process — a statutory obligation that EPA had thus far refused to respect.

In the 5-4 decision, Justice Antonin Scalia wrote: “It is not rational, never mind ‘appropriate,’ to impose billions of dollars in economic costs in return for a few dollars in health or environmental benefits. Statutory context supports this reading.”

The EPA contends that it took the economic impact into account in later steps of the rulemaking process. But EPA grossly underestimated the full impact of the rule because it ignored indirect costs. The real question for Kentuckians is this:

Is EPA going to seriously consider the economic damage done to Kentucky’s families dependent on mining?

In the first quarter of 2015, the number of employees at Kentucky coal mines stood at 10,356, far fewer than the 19,422 who worked in the mines in the first quarter of 2009. Thousands more provide for their own families by working at small businesses that cater to these miners or support the coal industry in some way.

Yet before celebrating, those dependent on coal may want to hold onto their hats. The decision may have been a victory, but the case was only a skirmish in the larger war on coal. The Supreme Court has merely ordered EPA to consider economic impacts before enforcing its draconian rule.

EPA is required to go back and do its homework on cost/benefit analysis before the rule may become effective. But with the Obama Administration in office—with its anti-coal agenda—it will not be surprising if EPA ultimately decides to implement the rule after considering the economic impacts, which means that this ultimately remains a political issue.

So, odds are that Kentuckians can expect the assault on the coal industry to continue. Oh, there will be announcements of government programs to spend a little money on workforce training, to help the displaced miners find new jobs, but there are no jobs. Unemployment in the coal fields is still the highest in the state.

We can also count on these regulations to drive the cost of electricity up for all of our households, small businesses and industries. Low power rates are one of the strongest lures the commonwealth has in bringing new jobs and industry here. Our advantage will take a big hit.

We continue to hear about green jobs that will be created with wind and solar energy. Neither of these will produce the cheap power that Kentucky needs to create jobs. Regardless, any of these “clean energy” solutions will not generate enough jobs in eastern Kentucky to help the thousands of displaced coal industry workers.

Under the EPA’s rule, our state will be forced to levy emission reductions that will produce an 18.3 percent reduction in carbon by 2030, based on 2005 levels. That’s a pretty big number, but consider this: By using levels from a decade ago, the reduction does not take into account 10 years of industrial growth. Thus, the reduction target will be even higher.

And let’s not forget “cap and trade.” This was a major initiative of the Obama administration that failed in Congress several years ago. Soon you will hear that the United States should get in the business of selling “carbon credits.”

Just like “cap and trade,” it delineates the maximum emission level and forces businesses to “purchase” the ability to expand by buying “credits.” This is widely used in Europe, but has lead to “speculative” pricing and become quite the business.

Higher energy costs would hurt everyone, but they would be especially harmful to small businesses. According to the NFIB Research Foundation’s 2012 Small Business Problems and Priorities survey, the cost of electricity was ranked number 12 out of 75 issues, ahead of other major problems like cash flow and poor earnings.

Small businesses need affordable energy not only to stay competitive but also to simply stay open. If the government essentially mandates higher energy costs, then the cost of everything else will go up as a result, and businesses will have no choice but to pass the higher costs onto their customers, people like you and me.

In order to create an environment that supports families and small businesses and helps create jobs, this Obama administration needs to expand our energy options, not limit them. If the administration is allowed to impose these drastic new rules on coal, then I’m afraid it will be lights out for Kentucky.

Tom Underwood is the Kentucky state director of the National Federation of Independent Businessn. He can be reached at tom.underwood@NFIB.org.

See the article here.

Southern States Rally for ‘Line in the Sand’ on EPA’s Clean Power Plan

Via E&E Publishing:

SAVANNAH, Ga. — Momentum is building across the Southeast toward a “just say no” campaign for U.S. EPA’s final Clean Power Plan rule, expected to be released within weeks.

A panel of lawmakers at the Southern Legislative Conference (SLC) yesterday passed a resolution urging state attorneys general to sue EPA over the rule that targets existing power plants. Broadly, the rule calls for a 30 percent reduction in carbon emissions by 2030, but targets for states vary.

States will have to write their own plans on how they are going to reduce their power sector CO2 emissions. If they do not, EPA will write the plan for them.

Del. Rupert “Rupie” Phillips, a Democrat from West Virginia, wrote the resolution, which passed SLC’s energy and environment committee. His original measure urged states to not submit plans with EPA, but a compromise was struck to direct attorneys general to take legal action first.

“It’s time to draw a line in the sand,” Phillips said. “The EPA is pushing us around like they are a bunch of punks. I just want the states to stand together and say ‘no.'”

A chief concern about refusing to file a plan is having EPA write one instead, said Arkansas State Rep. John Baine, a Democrat.

“As a state, I’d much rather have a plan that I got to pick,” Baine said.

The SLC is the largest of four regional legislative groups that operate under the Council of State Governments. Its 15 member states stretch from West Virginia to Texas and includes Kentucky, Missouri and Oklahoma. Its policy and positions committee is expected to vote on the Clean Power Plan resolution today.

Yesterday’s discussion, part of SLC’s four-day annual meeting, was the second debate over how states should respond to the Clean Power Plan. Presenters to the Southern States Energy Board (SSEB) on Saturday encouraged members to call the White House and share the group’s concern over the pending rule.

Presenters said they were encouraged by the number of states planning to sue once the rule is released.

“We ask that you look to your states as an action of this group, to your attorneys general, to your governors to see if we can get as many states as possible to file litigation, joint litigation to the EPA on this,” said Randy Eminger, vice president of the South region for the American Coalition for Clean Coal Electricity (ACCCE). “The more we have, the better.”

Eminger said ACCCE tallied 18 states ready to sue as soon as possible. In the Southeast, that includes Alabama, Arkansas, Georgia, Kentucky, Louisiana, North and South Carolina, Texas and West Virginia, according to a map posted at SSEB’s legislator briefing.

The governors or attorneys general of roughly double that amount have at least “expressed concern” over whether the proposed Clean Power Plan, which focuses on Section 111(d) of the Clean Air Act, is legal, he said.

“There are a large group of states that are really vocal,” he said.

The nonprofit SSEB covers 16 Southeastern states as well as the U.S. Virgin Islands and Puerto Rico. Board members include governors and lawmakers from the largely conservative region.

Some states opt for legislative review plans

For a region that contains states that are dominated by the coal industry, the proposed rule has been a tough pill to swallow. That was evident all throughout Saturday’s meeting where speakers constantly referred to the Clean Power Plan as “overreaching regulation” and accused EPA of overstepping its boundaries and interfering with state authority.

Some states, including Arkansas and West Virginia, already have decided a way around that by passing laws that require a number of state agencies to review the plan. Then lawmakers have to sign off on compliance plans before sending them to EPA.

“Any attempt has to be approved by the elected officials who are closest to the people of West Virginia,” said state Del. John McCuskey, referring to West Virginia’s House and Senate. “The [Department of Environmental Protection] will create a plan, if we don’t like it, it ain’t going to Washington.”

Mack McGuffey, a partner with the Troutman Sanders law firm, urged any states that are thinking about not writing a plan to reconsider. “Just say no” should not mean “don’t file anything,” it means writing a plan that follows the Clean Air Act, he said.

“Submit a plan, but submit a plan that follows the law, not necessarily the plan that the EPA is asking you to submit,” he said.

He’s expecting lawsuits with as many as 300 to 500 petitioners.

McGuffey dismissed whether EPA is writing the Clean Power Plan in a way that would encourage citizen lawsuits that just end up giving the rule more teeth. But he said the agency likely is going to lean on environmental groups to make sure states comply with their individual plans.

This is because McGuffey doesn’t think EPA has the resources to make sure every individual state stays on target. But the army of environmental groups do, he argued.

“What EPA is going to be looking for in every state’s plan is how enforcement is going to happen, and certainly citizen enforcement is going to have to be a part of that, I think in EPA’s eyes, because they want to keep the pressure on,” he said.

One supporter

One state and SSEB member that sent EPA a letter in support of the Clean Power Plan was Maryland. That was when Martin O’Malley, a Democrat, was governor.

Gov. Larry Hogan, a Republican, has not sent anything one way or the other, said Ben Grumbles, Maryland’s environmental secretary.

“We’re waiting to see what the final rule is,” he told EnergyWire.

Maryland is a member of the Northeast’s Regional Greenhouse Gas Initiative (RGGI), which some have pointed to as a way for other states to approach the Clean Power Plan (Greenwire

, July 14). For Maryland, being a member of RGGI has led to more than $300 million in revenue for the state.

“We recognize there have been benefits to being in [RGGI], and there may be greater benefits once the Clean Power Plan is issued,” he said.

See the article here.

Stop the EPA’s Carbon Power Grab, Colorado

Via The Denver Post:

The ruling is not likely to deter the EPA from finalizing its even more costly regulations on carbon emissions from coal plants this summer. Thus, states must be ready to ask the courts to block the implementation of a regulatory scheme that, according to independent economic consultants, will cost energy consumers up to $479 billion, likely the most expensive in the history of the Clean Air Act.

But they will accomplish only a minute reduction of worldwide carbon emissions.

The rules will, however, produce double-digit electric rate increases in Colorado, according to NERA Economic Consulting. Rural Colorado — with mines already facing shutdown because of decisions and policies that push the envelope of climate activism — will suffer economic devastation. Jobs paying average wages and benefits exceeding $122,000 annually will be destroyed.

And Colorado, which at one time ranked second only to Wyoming in the payment of federal coal royalties, will lose an important source of revenue for public schools and governments. Clean coal, which meets 60 percent of the state’s electricity needs, would be displaced by more expensive sources.

The rule fundamentally alters the way that states provide electric power through a series of “outside the fence” measures that the EPA itself lacks authority to implement. These include unrealistic directives to significantly expand the use of renewable energy and natural gas. It is this expansion of federal power, however, that may prove to be the rule’s ultimate undoing. In its mercury rule decision, the Supreme Court challenged the EPA’s claim to deference in the agency’s interpretation of the Clean Air Act. The EPA’s scheme to restructure the nation’s electricity grid through the carbon rules will likely raise additional arguments on the degree to which courts should accept agency interpretations of law.

Thus, it comes as no surprise that more than 30 states have questioned the legal basis for the EPA’s sweeping changes, and many are planning to file suit. Colorado must do the same. We cannot afford to rely on past assurances. Once the rules become final, Colorado must join other states in asking the courts to stop its implementation pending appeal.

The court only acted on the mercury rule after power plants had spent billions on unnecessary controls. The stakes are even higher here. Staying the rules will remove the EPA straitjacket, and avoid saddling Coloradans with higher rates, shuttered plants and a shattered economy.

Stuart Sanderson is president of the Colorado Mining Association

See the article here.

Power Plant Cuts ‘Too Much Too Soon,’ Utilities Tell White House

Via The Washington Examiner: 

Coal utilities are urging the White House in an eleventh-hour plea to push back the Obama administration’s timeline for cutting carbon emissions at existing power plants, saying the aggressive deadlines pose a threat to electric reliability.

The Environmental Protection Agency’s proposed plan simply does not give enough time to build the transmission lines and other resources needed to make up for the power plant losses already taking place under other EPA regulations, said Melissa McHenry, director of communications for American Electric Power.

The coal utilities are already closing a significant number of power plants to comply with separate EPA rules for controlling mercury and acid gases at power stations. The Clean Power Plan, scheduled for finalization in August, would exacerbate those losses by requiring states to swiftly adapt under an overly aggressive timeframe that could lead to reliability problems and power outages, the utilities say.

The Clean Power Plan lays out an aggressive schedule for states to develop and implement plans to lower greenhouse gases beginning in 2020, to meet a 30-percent emission reduction goal by 2030. Many scientists say that greenhouse gas emissions, mainly from burning fossil fuels such as coal, are driving manmade climate change.

It’s “too much too soon,” McHenry said. The main concern is that there is not enough time to comply with the interim targets that begin in 2020, she says. That’s when the states will have to work the hardest to reduce emissions. American Elecrtric Power, states and others have raised the timing issue for months. EPA said it is planning to address the concerns once the plan is made final. Yet, McHenry and others say nothing has been recently communicated on the EPA’s plans.

Other industry advisers say they are convinced that nothing will change based on the discussions the Obama administration is holding before finalizing the rules, and that the EPA and the White House codified the basic regulations months ago with perhaps minor changes.

Big coal utilities American Electric Power and Duke Energy met Monday at the White House to discuss its concerns over the Clean Power Plan, the center of President Obama’s climate change agenda.

The White House Office of Management and Budget is conducting the meetings as part of its final review process. The final meetings on the Clean Power Plan began last month and should wrap up soon, according to officials tracking the meetings.

Once the meetings conclude, the rule could be issued at any time, making it law once it is published in the Federal Register.

Last week’s meeting was the second time big coal utilities met with White House officials in the last few weeks to discuss the problems they see with the Clean Power Plan, according to the Edison Electric Institute. “This meeting was part of our ongoing outreach efforts on the Clean Power Plan,” said Quin Shea, the group’s environmental affairs vice president. “EEI’s comments submitted to EPA in December outline several areas of industry concern with the [rule’s] guidelines as they have been proposed, and provide suggestions to address those concerns.”

The coal utilities’ CEOs and the head of the Edison Electric Institute, Tom Kuhn, sat down with President Obama’s senior climate change adviser, Brian Deese, and EPA air chief Janet McCabe to discuss the problems they see with the regulation.

McHenry noted that the administration also sat down with a number of other utilities last week, representing nuclear and natural gas companies, which don’t share the same concerns as the coal utilities.

Companies such as Calpine, the country’s largest natural gas-fired utility, and NextEra have a “little different” take on the EPA climate rules than coal utilities, she said. They tend to be “much more supportive of the end of coal-fired generation,” she said.

The meeting with the gas and nuclear utilities was held Wednesday.

The utilities were represented as a coalition, called the Clean Power Plan Initiative, and include Calpine, Exelon, NextEra, PG&E, National Grid, Dominion Energy, Austin Energy, PSEG, Los Angeles Department of Water & Power, Seattle City Light, and the New York Power Authority. The coalition in comments sent in December to the EPA said it supports the emission rules and believes the agency has the legal standing to move forward.

See the article here.

Pence Encourages States to Fight Greenhouse Gas Rules

Via The Indianapolis Star:

The rules, which are expected to be finalized this summer, are the cornerstone of the administration’s plan to curb climate change.

If states refuse to comply, the EPA has said, it will impose its own plan. But that would delay implementation, even without the legal challenge Pence says he’s committed to make.

“We think we’ve got a strong opportunity to defend ratepayers, and I think it would be worth the fight,” he said about the cost of litigation.

Under the initial proposal, Indiana would have to reduce its emissions rate 20 percent by 2030.

The EPA has estimated that could be done by increasing plant efficiency, reducing energy demand through energy efficiency programs, switching to renewable energy sources and using natural gas instead of coal — which sends more carbon dioxide into the atmosphere for the amount of energy produced than any other energy source.

Complying would raise electric rates in the region that includes Indiana by about 6 percent in 2020, the EPA estimates. By 2030, as the cost of making energy improvements and other efficiencies begins to pay off, the increase in rates due to the rule is projected to be less than 1 percent, according to the EPA.

Pence — who called Indiana a “proud pro-coal state” — said he questions the EPA’s estimates and believes electricity rates would rise dramatically. A report for industry groups says costs would rise an average of 12 percent.

Republican governors from Oklahoma, Wisconsin, Texas and Louisiana have indicated they also will defy the regulations.

On the other side of the spectrum, the Analysis Group of Boston is scheduled to release a report next week showing the economic benefits enjoyed by a group of Northeastern states that have already reduced carbon dioxide emissions through an emissions trading program. Closer to Indiana, Michigan GOP Gov. Rick Snyder is trying to make his state a national leader in revamping its energy portfolio to reduce its use of coal.

The Obama administration argues that failing to address climate change will hamper economic growth and put the health and well-being of Americans at risk from extreme weather events, wildfires, poor air quality and illnesses transmitted by food, water and disease carriers such as mosquitoes and ticks.

“Climate change is actually impacting the economy today,” EPA Administrator Gina McCarthy told a congressional panel Thursday. “If you look at action on climate and see the kind of economic benefits it can provide that will not just protect us from escalating carbon, but grow a low-carbon future with new jobs, that is the goal post that all of us are looking for.”

See the article here.

A Cautionary Tale on Energy

Via Philly.com:

The idea of Pennsylvania doing things “the California way” doesn’t make much sense. Unfortunately, Pennsylvanians may not have a choice if the Obama administration has its way.

The U.S. Environmental Protection Agency will soon finalize the Clean Power Plan, which requires states to reduce carbon dioxide emissions by 30 percent by 2030. To meet these drastic reductions – which will have no impact on global temperatures – every state will have to impose California-style taxes, manipulate markets, and enforce shortsighted mandates. These are the same policies that have contributed to the Golden State’s sky-high energy prices and persistently high unemployment.

Take it from a native Californian and former official with the California Energy Commission: You don’t want our energy policies.

In 2006, California passed its landmark energy mandate requiring citizens and industry to reduce greenhouse gas emissions to 1990 levels by 2020. Central to the law is California’s cap-and-trade system, a costly carbon-trading scheme that is the stuff of Enron’s dreams. Another piece is California’s renewable electricity mandate, which requires utilities to purchase 33 percent of their electricity from unreliable sources like wind and solar by 2020.

This regulatory system is tortuous. California’s Database of State Incentives for Renewable Energy counts 200 different state programs that mandate or subsidize renewable energy production. That’s on top of the 28 federal programs that further inflate California’s renewables industry and raise consumer prices.

These programs were supposed to “drive long-term investment” in wind and solar. Instead, California’s green energy dream has turned into a nightmare. Residential electricity prices are 40 percent higher than the national average and eighth-highest in the nation. Expensive energy also contributes to California’s stubbornly high unemployment rate, which, at 6.3 percent, sits a full percentage point higher than the national average.

Additionally, California suffers from an increasingly unreliable electric grid. California’s grid operator has warned that with less generation from conventional sources and more from unreliable renewable sources, “the system becomes increasingly exposed to blackouts when generation or transmission outages occur.”

Despite these ill effects on the economy and the power grid, the EPA and national environmental groups think policymakers in Sacramento got it right. They say California has a head start on the EPA’s grid of the future. However, these observers fail to realize that California’s foolish policies make even less sense for the rest of the country.

First, California is blessed with mild temperatures, so heating and cooling expenses take less of a toll there than in most other places in the United States. Second, California currently imports much of the reliable power it needs. If Pennsylvania and every other state in the country imposed California’s regulatory scheme, we would run out of places to produce reliable electricity. Third, California’s economy does not support energy-intensive manufacturing. Part of the reason the manufacturing industry – and the jobs it supports – left California in the first place is its higher energy costs.

But despite California’s failures, Washington hasn’t learned a thing. The Clean Power Plan calls on states to craft their own compliance plans, and the EPA pretends it’s offering them flexibility. But the rule is so strict that in reality, the EPA is forcing states to impose some mix of California-style capping, taxing, and mandating.

California is no model. It’s a cautionary tale. States that choose to comply will become accomplices in the EPA’s plan to export California’s failed energy policies nationwide, and with predictable results – higher costs, less reliability, and lower standards of living. States that aren’t interested in this outcome should reject the EPA’s demands to submit compliance plans. If policymakers in Harrisburg come up with the same answers as those in Sacramento, they’re asking the wrong questions.

See the article here.

 

States Consider Defying Obama Climate Rule

Via The Hill:

Governors of some conservative states are threatening to disregard President Obama’s signature climate rule for power plants, potentially creating a showdown with the federal government.

Opponents of the Environmental Protection Agency’s regulation hope that the decisions by the six governors could lead to a significant or complete destruction of the rule, thwarting one of Obama’s top legacy policies.

The rule, due to be made final next month, will rely on states to formulate plans to reduce their power plants’ emissions of carbon dioxide.

If states don’t comply, the EPA has asserted that it has authority under the Clean Air Act to come in and write its own compliance plans for states.

Senate Majority Leader Mitch McConnell (R-Ky.), one of the most vocal congressional opponents of the climate rule, told governors earlier this year to defy it, lest they help the Obama administration implement a costly set of regulations that he says will be struck down in court.

Some states are taking that gamble.

Indiana Gov. Mike Pence (R) declared in June that his state would ignore the rule unless it is “demonstrably and significantly improved.”

“This rule represents an effort by the administration to continue to advance a climate change agenda through the regulatory state and does not give due regard to the impact that that will have on electricity rates coming from coal-burning power plants,” Pence told reporters Thursday in a call organized by the conservative American Energy Alliance.

“I do believe this rule is on a very shaky legal foundation,” Pence said.

Oklahoma Gov. Mary Fallin (R) went further, signing an executive order in April instructing state agencies not to comply with the rule.

“While the environmental benefits of these regulations will be minimal, the economic devastation of these overreaching and unrealistic regulations will be very real,” Fallin said, saying the order “makes it clear the state of Oklahoma has no intention of implementing new regulations that run directly contrary to the interests of our citizens and our state.”

Rep. Frank Lucas, an Oklahoma Republican, said Fallin did the right thing.

“We are a state that traditionally has had reasonably priced energy,” Lucas said. “To have these mandates that many of my neighbors, constituents and industry at home think are not reasonable, I think the governor’s just a reflection of the state, which is why she’s governor.”

Wisconsin Gov. Scott Walker (R), like Pence, has pledged to defy the rule unless major changes are made. Texas Gov. Greg Abbott (R) and Louisiana Gov. Bobby Jindal (R) have identified resisting the rule as a distinct possibility, while West Virginia Gov. Earl Ray Tomblin (D) signed a bill requiring legislative approval of any compliance plan.

And both major candidates to be governor of Kentucky — a major coal-producing state — have pledged not to comply.

Defiance from the states is emerging as one of the most promising strategies for opponents of the climate rule. If enough states don’t comply, they hope that it would bolster court cases against the rule, make it more difficult for the EPA to impose compliance or at least force the Obama administration to write expensive, onerous state plans.

The rule’s opponents say that last month’s Supreme Court ruling against the EPA’s limits on emissions of mercury and other air pollutants from power plants reinforces that states should not write compliance plans.

The Supreme Court did not overturn the mercury rule, but the justice’s finding that the EPA did not consider industry costs early enough in the regulatory process came too late for power plants that have already shut down.

“While much of the damage of this regulation has already been done, the ruling serves as a critical reminder to every governor contemplating the administration’s demands to impose more regressive — and likely illegal — regulations that promise even more middle-class pain,” McConnell said after the ruling.

“Clearly, there is no reason to subject their states to such unnecessary pain before the courts have even had a chance to weigh in, especially if the Supreme Court simply ends up tossing the regulation out as we saw today.”

Supporters of the power plant regulations say that the “just say no” approach is harmful and argue the lack of a full endorsement from any state other than Oklahoma shows that it’s not catching on.

“It hasn’t gotten much pickup,” said David Doniger, the air and climate director at the Natural Resources Defense Council.

Governors are likely realizing that ignoring the rule will not actually help their state, Doniger said.

“What’s really on all of the governor’s minds is that they have an opportunity to tailor a plan to meet local conditions. But they don’t really have an opportunity to shield the power companies in their state, because if the states don’t regulate the power plants, it’s a federal responsibility to do it,” he said.

Jamie Van Nostrand, a West Virginia University environmental law professor, said that even in the states with governors bashing the rule, other agencies might be working on complying.

“The governors and political leaders are going to be out front with ‘just say no.’ But the question is, are they actually following through?”

“It’s hard to say if that work is not going on behind the scenes, versus the politically popular statements by the governors and elected officials.”

Rep. Gene Green (D-Texas) said Texas Gov. Greg Abbott (R) should work with the EPA to make the rule palpable for the state, like Green has been doing with some colleagues.

“I wish we could sit down with EPA instead of just saying ‘we’re ignoring it.’ That’s what I’ve been trying to do,” he said. “Ultimately it will be good, but we need to sit down with them.”

See the article here.

KY Race May Alter Clean Power Plan Fortunes

Via Environment & Energy Daily:

For many supporters of the Obama administration’s landmark proposal to cut greenhouse gas emissions from existing power plants, Kentucky is an example of the plan’s viability.

Even though the state is a major producer and consumer of coal, Democratic Gov. Steve Beshear’s administration thinks it can develop a plan to comply with U.S. EPA’s proposed mandates.

But the state’s posture is likely to change after this year’s gubernatorial election. Every major candidate in today’s gubernatorial primary — including the leading Democrat — has either promised or suggested they would not follow through with a plan.

“At my direction, my administration will resist EPA and their draconian regulatory agenda,” Republican hopeful Matt Bevin, who ran for U.S. Senate unsuccessfully last year, told the Kentucky Coal Association in a letter last week.
Pro-coal, anti-EPA rhetoric is common in political races in Appalachia. So the Kentucky Coal Association wanted to make sure candidates were on the record specifically about their Clean Power Plan compliance intentions.

The industry group asked the candidates one question: “If elected the Governor of Kentucky, will you submit a GHG State Implementation Plan (or SIP) or will you refuse to do so?”

Attorney General Jack Conway, the leading candidate on the Democratic side, told the KCA: “I believe the recent actions by EPA are an illegal overreach of its authority, and my administration will work to prevent further damage to our state’s economy from overzealous regulation.”

For now, the state’s Democratic governor is bucking another of its top politicians, Senate Majority Leader Mitch McConnell (R), who wants states to unify in opposing the Clean Power Plan.

Next year, after Beshear has left office, Kentucky may join the “just say no” contingent. KCA President Bill Bissett says the move would send a message to the country that the state is not divided on the issue.

“It adds another state to the solid column of [those] against” the rule, said Bissett during an interview about the significance of this year’s elections.

EPA plans on finalizing the Clean Power Plan later this year. States would then have to submit their plans or extension requests by 2016. Jurisdictions that don’t comply risk EPA implementing a plan on their behalf.

That’s where the “just say no” strategy comes in. Seeing the proposed rule as an illegal overreach, coal industry opponents and their political allies favor letting EPA carry the rule’s burden rather than states voluntarily submitting to pollution limits.
“Their ability to ramrod this through decreases by day,” Bissett said about EPA’s options in the face of states boycotting the plan. He sees litigation or a future president scaling back the rule.

‘Saying this for political reasons’

Beshear and his Energy and Environment Cabinet Secretary Len Peters are generally pro-coal. But while they don’t like EPA’s proposal, they are willing to move forward with its implementation (E&E Daily, March 4).

Peters has been optimistic about the state being able to craft a plan, despite limits passed by the General Assembly, where the Senate is under Republican control and the House is in Democratic hands.

Because the Bluegrass State is so coal reliant, EPA would only require its power sector to cut its carbon emissions by 18 percent from 2012 levels by 2030 — among the lowest targets in the nation.

“Will the next governor take that and move with it? I don’t know,” Peters said during a recent climate conference. “But we want to give him an opportunity to look at what we have been thinking the last several years.”

That’s why Kentucky political analyst Al Cross isn’t sure candidates opposing the Clean Power Plan will stand by their words when it’s time to submit a state implementation plan.

“It’s a doable thing,” said Cross about EPA’s proposal. “They’re just saying this for political reasons.” He added, “It wouldn’t surprise me to find them picking up where Peters and Beshear have done.”

Despite the “just say no” campaign by rule opponents, 41 states are considering their options and in talks with neighboring states about compliance plans (ClimateWire, May 18).

Michael Dowd, director of the air division at Virginia’s Department of Environmental Quality, lamented that West Virginia and Kentucky would likely not be part of such discussions. Dowd’s state must cut its emissions by 38 percent, according to EPA’s draft rule.

“We think that they have a competitive advantage,” Dowd said during a recent conference. A state in the same region with greater emissions reduction responsibilities will bear more cost and pass it through to its industries, he noted.
Bissett knows there’s always a risk politicians will say one thing and do another when push comes to shove. But he said, “I feel confident” about them sticking to their positions.

Conway well-positioned

A SurveyUSA poll released last week showed Agriculture Commissioner James Comer, former Louisville Metro Councilman Hal Heiner and Bevin essentially tied for the GOP nomination.

Conway enjoys a comfortable lead over primary rival Geoff Young, who is running as a progressive, pro-environmental regulations Democrat.

The attorney general, who ran for Senate in 2010 and lost to Republican Rand Paul, is also well-positioned for the general election, polls show (Greenwire, May 14).

But after today’s primary, the Republican nominee will likely escalate his attacks against Conway’s Democratic connections. President Obama remains unpopular in the state, and coal field residents blame him for the sharp downturn in mine employment.

Conway will try to inoculate himself by pointing to litigation by him and other states against the Clean Power Plan. “Conway has his line down,” Cross said. “This suit is central to his candidacy. He’s got that comeback, and it relies on a coal issue.”
But he may be more vulnerable to political attacks on stances on two other lawsuits. Conway decided against defending the state’s gay marriage ban in court or suing to overturn the Affordable Care Act.

“In the current environment, you’re just expected to be pro-coal,” said Cross. But he doesn’t see the Clean Power Plan debate as a make-or-break issue in this fall’s gubernatorial election. “This is not something most people are paying attention to.”

See the article here.

Governor Pence: EPA Climate Rule ‘A Genuine Threat’ To Cheap Energy

Via The Daily Caller:

Indiana Gov. Mike Pence is joining a growing number of states threatening not to implement the key aspects of the Obama administration’s global warming agenda, arguing pending Environmental Protection Agency regulations would impose huge costs on Americans.

“One of the advantages in our economy has always been the affordability and reliability of electricity,” the Indiana Republican told reporters in a press conference hosted by the American Energy Alliance, “so the effort by the administration in the proposed rule… represents a genuine threat to the affordability of electricity.”

Pence joins Republican governors in Texas, Louisiana and Wisconsin opposing the EPA’s “Clean Power Plan” to limit carbon dioxide emissions from existing power plants. The proposed rule forces Indiana to reduce emissions from its power sector 20 percent below 2005 levels by 2030.

“No state is obligated to adopt the president’s climate change agenda as their own,” Pence said, adding that Indiana would not comply with the Clean Power Plan if it’s not repealed or dramatically changed.

 

Indiana gets about 85 percent of its electricity from coal-fired power plants, meaning substantial amounts of coal power would have to be shuttered in order to comply with the EPA’s rule. This means ratepayers will have to pay increased costs for changing the electricity mix of the grid. The state will also have to use more green energy which could also add to residents’ energy bills.

 

“We do have a choice,” Pence said. “You can refuse to submit a state plan. You can challenge the EPA’s ability to impose a federal plan. There’s nothing illegal about saying ‘no’ on behalf of ratepayers and businesses in your state.”

 

Republican lawmakers and conservative groups are pushing states to refuse to implement the Clean Power Plan, arguing the rule could be struck down or amended by future court decisions, leaving states with billions of dollars of wasted investments.

 

Republicans have also questioned the EPA’s authority to enforce aspects of its own rule, which could create more problems for states that comply.

Last week, the Supreme Court struck down a major EPA mercury rule, called MATS, that was forcing hundreds of coal-fired power generators to prematurely retire. Even though the rule was struck down, coal plants will still be forced to shutter because utilities have already made the investments required by the rule.

 

Conservatives are already drawing parallels between the MATS ruling and the future of the Clean Power Plan.

 

“Our concern has been an attitude by the EPA that they can move forward with certain regulations without taking into account the costs and benefits,” Doug Domenech, the director of the Fueling Freedom Project at the Texas Public Policy Foundation, told The Daily Caller News Foundation.

 

“They’ve already essentially forced the utilities to make the changes they want to make,” Domenech said. “The climate rule is sort of shaping up to be the same kind of thing.”

 

The EPA argues the MATS ruling will have no impact on the Clean Power Plan. The agency says it properly considered the costs of the rule — in contrast to MATS.

 

“The Court’s conclusion that EPA must consider cost when determining whether it is ‘appropriate’ to regulate toxic air emissions from utilities under section 112 of the [Clean Air Act] will not impact the development of the Clean Power Plan under section 111,” the EPA’s Janet McCabe wrote in a blog post.

 

“Cost is among the factors the Agency has long explicitly considered in setting standards under section 111 of the Act,” McCabe added.

 

“It’ll be too late,” Domenech said, referring to what would happen if states complied with the Clean Power Plan. “The EPA will have already forced the states to change their energy.”

See the article here.

The Many Problems of the EPA’s Clean Power Plan and Climate Regulations

Via The Heritage Foundation:

No matter one’s personal opinions on the climate effects of man-made greenhouse emissions, the Obama Administration’s proposed climate-change regulations will exact a high price on Americans and have a negligible impact—if any—on global temperatures. The EPA has already put into place several greenhouse-gas regulations; however, the most far-reaching regulations are set to be finalized this summer. Known as the Clean Power Plan, these regulations have garnered bipartisan concern at all levels of government due to the threats the Clean Power Plan poses to the economy, quality of life, reliability of the national power grid, and constitutional separation of powers. Congress and the states should intervene and reject these regulations entirely before the U.S. energy system is put on a costlier and less reliable path.

This summer, the Obama Administration will finalize climate regulations for new and existing power plants under the Clean Air Act. While the regulations largely target coal-fired power plants, the costs of more expensive energy will be borne by all Americans. Higher energy bills for families, individuals, and businesses will destroy jobs and strain economic growth—and it will all be for naught. No matter one’s belief on the climate effects of man-made greenhouse emissions, the regulations will have a negligible impact—if any—on global temperatures.

The regulations for both new and existing power plants will face a number of legal challenges, and rightly so. However, waiting on the outcomes of legal battles would likely mean that states will already be on an irreversible path toward shuttered power plants, increasing energy bills, and lost opportunity. Furthermore, by placing the entire onus on the states to devise their own carbon-cutting plans, the Environmental Protection Agency (EPA) evades all accountability to Americans and leaves state officials to take the political heat for executing power plant regulations that are all economic pain and no environmental gain.

Both Congress and the states need to step forward and reject these regulations entirely, not succumb to the executive branch’s coercion. Congress should pass legislation, use the Congressional Review Act, or prohibit funding for implementation of the regulations. State officials should understand that no matter how much flexibility the EPA grants them, their citizens come out on the losing end.

The Regulations

The EPA issued separate carbon dioxide (CO2) regulations for new power plants (September 2013) and existing units (June 2014) but will finalize both jointly this summer. Under Section 111(b) of the Clean Air Act, the EPA outlined regulations for new electricity-generating units, called the New Source Performance Standards. The standards for new plants set a threshold for fossil-fuel-fired electric steam-generating units (utility boilers as well as Integrated Gasification Combined Cycle units) at 1,100 pounds of CO2 per megawatt hour (mwh).[1] For natural-gas-fired stationary combustion turbines, the EPA set thresholds of 1,000 pounds of CO2/mwh for larger units and 1,100 pounds of CO2/mwh for smaller units.[2]

Under section 111(d) of the Clean Air Act, the EPA also intends to regulate CO2 emissions from existing power plants. Known as the Clean Power Plan (CPP), the agency’s proposed regulations set state-specific emissions limits based on the greenhouse-gas-emissions rate of each state’s electricity mix. The EPA estimates that its regulations will reduce greenhouse-gas emissions approximately 25 percent below 2005 levels by 2020, and 30 percent by 2030.[3] Each state has interim targets it must meet beginning in 2020, and the EPA proposed that states use a combination of four “building blocks” to achieve the emissions reductions: (1) improving the efficiency (heat rate) of existing coal-fired power plants; (2) switching from coal-fired power by increasing the use and capacity factor, or efficiency, of natural-gas combined-cycle power plants; (3) using less carbon-intensive generating power, such as renewable energy or nuclear power; and (4) increasing demand-side energy-efficiency measures.

States will have one year to develop and submit their own compliance plan or develop regional plans with other states, though the EPA will likely grant extension waivers. After that, the EPA will take approximately one year to approve or reject the plan. The EPA is currently developing a federal “model” for states to consider and will impose a federal plan for states that do not comply.

No matter how states concoct their plans, the economic damages will be felt through higher energy costs, fewer job opportunities, and fewer choices through implementation of efficiency mandates that remove decision making from producers and consumers. The EPA’s idea of flexibility will not soften the economic blow; it merely means that families, individuals, and businesses will incur higher costs through different mechanisms.

The Costs: Higher Energy Prices, Fewer Jobs, Less Growth

Energy is a key building block for economic opportunity. Carbon-emitting fuels, such as coal, oil, and natural gas, provided 87 percent of America’s energy needs in the past decade and have been the overwhelming supplier for over a century.[4] Throughout that time, particularly during the Industrial Revolution, access to energy was a critical catalyst to improved health, comfort, progress, ingenuity, and prosperity.[5] Evidence in the United States and around the world demonstrates that the availability of energy positively impacts economic growth or, at the very least, the two jointly impact one another.[6]

On the other hand, restricting the production of carbon-emitting conventional fuels with heavy-handed regulations, such as the Clean Power Plan, will significantly harm the U.S. economy. Americans feel the pain of higher energy prices directly, but also indirectly through almost all of the goods and services they buy, because energy is a necessary component of production and service. Companies will pass higher costs on to consumers or absorb the costs, which prevents hiring and new investment. As prices rise, consumer demand falls, and companies will drop employees, close entirely, or move to other countries where the cost of doing business is lower. The result is fewer opportunities for American workers, lower incomes, less economic growth, and higher unemployment.

Without the details of the final regulations, and given the complexities of state plans, it is difficult to fully model the economic effects of the Administration’s Clean Power Plan; however, economic models can provide a snapshot of the economic losses that CO2 regulations would impose. The economic consulting firm NERA projects that whether or not a plan is state-administered or EPA-administered, electricity prices will increase considerably. If states administer the plan, electricity prices will increase by an average of 12 percent between 2017 and 2031, but if the rulemaking is left to the EPA, prices will rise an average of 17 percent during that time period.[7]

But the economic pain is felt beyond electricity prices, and the Administration’s climate agenda extends beyond power plants. The federal government has enacted greenhouse-gas regulations through fuel-efficiency standards, proposed methane regulation for hydraulic fracturing, stalled on project decisions like the Keystone XL pipeline, and spent stimulus money on inefficient and expensive renewable technology. In the U.S. climate agreement with China, President Barack Obama promised country-wide carbon-emissions cuts of 26 percent to 28 percent below 2005 levels by 2025.[8]

To provide an estimate of the broad damage that the Administration’s climate agenda would inflict, Heritage Foundation economists modeled the negative economic effects of a carbon tax. Using the Heritage Energy Model (HEM), a derivative of the model used by the U.S. Energy Information Administration, Heritage analysts quantified the economic loss based on a carbon tax equivalent to the Administration’s estimate of the social cost of carbon (SCC). The EPA defines SCC as the economic damage that one ton of CO2 emitted today will cause over the next 300 years. As dubious and subjective as the models are that calculate the SCC, they provide the foundation for the federal government’s climate regulations.[9]

Taxing CO2-emitting energy incentivizes businesses and consumers to change production processes, technologies, and behavior in a manner comparable to the Administration’s regulatory scheme. In fact, enacting a tax is much more economically efficient than a complex regulatory scheme; therefore, the Heritage analysis likely underestimates the impacts.[10] Further, to neutralize the analytical impacts of a tax’s income transfer, Heritage analysts model a scenario in which 100 percent of carbon-tax revenue is rebated to taxpayers, thereby only estimating the economic loss the tax would impose, known as the deadweight loss. By 2030, the costs would be:

  • An average annual employment shortfall of nearly 300,000 jobs;
  • A peak employment shortfall of more than 1 million jobs;
  • A loss of more than $2.5 trillion (inflation-adjusted) in aggregate gross domestic product (GDP); and
  • A total income loss of more than $7,000 (inflation-adjusted) per person.

The economic pain stemming from the EPA’s regulation would spread throughout the country, but some would be harmed more than others. Those disadvantaged the most by the EPA’s regulations are:

  • Low-income and fixed-income families. A tax that increases energy prices would disproportionately eat into the income of the poorest American families. While the median family spends about 5 cents out of every dollar on energy costs, low-income families spend about 20 cents.[11] As the number of fixed-income seniors grows in the U.S., low-income seniors who depend largely on a fixed income are especially vulnerable.[12]
  • Manufacturers. The shale revolution is driving energy-intensive industries to the United States. The Administration’s climate agenda would drive these industries away. America’s manufacturing base is hit particularly hard by higher energy prices. Over 500,000 of the jobs lost in the Heritage analysis are manufacturing jobs.
  • The Midwest. The Heritage analysis of manufacturing-job losses by congressional district finds that districts in Wisconsin, Ohio, Indiana, Michigan, and Illinois would suffer most. In fact, 19 of the top 20 worst-off congressional districts from the Administration’s energy regulations are located in the Midwest region.[13]

The Climate and Environmental Benefits: None

The trade-off that Americans receive for higher electricity rates, unemployment, and lower levels of prosperity is not an appealing one. Even though electricity generation accounts for the single-largest source of carbon dioxide emissions in the United States, the estimated reduction is minuscule compared to global greenhouse gas emissions. Using the “Model for the Assessment of Greenhouse Gas Induced Climate Change,” developed with support from the EPA, climatologists Paul Knappenberger and Patrick Michaels estimate that the climate regulations will avert a meager –0.018 degree Celsius (C) of warming by the year 2100.[14]

In fact, the U.S. could cut its CO2 emissions 100 percent and it would not make a difference in global warming. Using the same climate sensitivity (the warming effect of a doubling of CO2 emissions) as the U.N.’s Intergovernmental Panel on Climate Change (IPCC) assumes in its modeling, the world would only be 0.137 degree C cooler by 2100. Including 100 percent cuts from the entire industrialized world merely avert warming by 0.278 degree C by the turn of the century.[15]

More evidence continues to show lower climate sensitivity to increases in global CO2 emissions, meaning that emissions cuts would be even more futile.[16] However, even if one assumes the IPCC’s estimate on climate sensitivity to be accurate, the only way to stay below the IPPC’s 2-degree Celsius threshold (before the earth allegedly reaches a tipping point of irreversible climate damage) is to force damaging cuts from rapidly developing countries, such as India and China, and even that might not be enough.

Not only are these cuts unattainable; they are morally objectionable. Members of the United Nations signed the United Nations Framework Convention on Climate Change in 1992 with the goal of keeping anthropogenic greenhouse gas emissions from dangerously affecting the climate. That year, the respective GDPs per capita of China and India were $364 and $325.[17] In 1998, those figures increased to $820 per capita and $425, respectively.[18] Since 1998, there has been a hiatus in increasing global average surface temperature.[19] Throughout this time period, GDP per capita increased significantly to $6,800 and $1,500, respectively, fueled by inexpensive and reliable power from conventional fuels, such as coal, oil, and natural gas.[20] While this growth is impressive, it is by no means near the level of developed, industrialized countries. The use of carbon-dioxide-emitting conventional fuels has been a staple in such rapidly accelerating growth as China’s—now the world’s largest emitter of CO2.

Despite China’s growing need for carbon-emitting conventional fuels, President Xi Jinping committed to a peak limit on CO2 emissions in 2030. Although China has set up pilot carbon-trading schemes, there is nothing that binds China to keep its word, and the U.S. should not blindly implement any carbon-cutting regulation under the assumption those cuts will come. Simply put, much can happen in 15 years and policy interests can change rather quickly. Furthermore, China’s lack of intent to tackle true environmental problems should be a red flag. China has failed, for instance, to require the continual use of scrubbers on coal-fired power plants, causing significant health problems from black carbon soot. If China is not willing to curb industrial productivity to address a real health problem, there is little reason to believe it will do so to address CO2 emissions. With the current pressure from U.N. climate negotiations well in the past by 2030, there would be even less incentive for China to follow through with a non-binding agreement.[21]

India is even more resistant than China to commit to carbon caps and for good reason. India has hundreds of millions of people without access to electricity. The commitment and pressing issue for all developing economies should be to give their people a better standard of living, not reduce carbon emissions. Economic growth and affordable, reliable energy are a priority for the people living in China, India, and the rest of the developing world.[22] Action on climate change simply is not.

Threats to Reliability

One of the primary concerns among many electricity-grid operators across the country is the power plant regulations’ effect on grid reliability. With uncertainty looming as to which of the EPA’s building blocks will stand in court, taking a massive amount of baseload power offline could create huge strains on the grid that generates and delivers electricity to consumers. The U.S. Energy Information Administration projects that more than double the coal-fired power plants will retire as a result of the Clean Power Plan compared to a scenario without the regulation.[23] The CPP itself threatens the means to aiding such a traumatic transition from coal by causing the price of natural gas and natural gas infrastructure to increase, making it less economical to build. At the very least, the implementation of the CPP means a very expensive and unnecessary transition for ratepayers.[24] A number of regional grid operators as well as the North American Electric Reliability Corporation (NERC), an international nonprofit established to ensure the reliability of bulk power in North America, raised issues with the proposed regulation.[25]

NERC wrote in its initial report of the EPA’s regulations that “[n]ew reliability challenges may arise with the integration of generation resources that have different ERS [Essential Reliability Services] characteristics than the units that are projected to retire”—in other words, the intermittent renewables on which the EPA depends to replace retired coal electricity increase the risk of reliability problems. Further, NERC states that the “proposed timeline does not provide enough time to develop sufficient resources to ensure continued reliable operation of the grid by 2020. To attempt to do so would increase the use of controlled load shedding and potential for wide-scale, uncontrolled outages.”[26]

Regional grid operators—the Independent System Operators/Regional Transmission Organizations (ISOs/RTOs)—have expressed similar concerns. The Southwest Power Pool (SPP) warned that “[u]nless the proposed CPP is modified, the SPP region faces serious, detrimental impacts on reliable operation of the bulk electric system—introducing the very real possibility of rolling blackouts or cascading outages that will have significant impacts on human health, public safety, and economic activity.”[27]

The Midcontinent Independent System Operator (MISO) cautioned that it is already addressing threats to grid reliability as a result of the EPA’s Mercury and Air Toxics Standards, a regulation where 99.996 percent of the benefits come from including estimated benefits from reducing particulates (co-benefits) already covered by existing regulations.[28] MISO further cautioned that the shuttering of coal-fired plants will significantly reduce the operator’s reserve margin,[29] increasing the probability of using emergency procedures.[30]

Managing grid operations for the Mid-Atlantic, PJM Interconnection recommends “additional process provisions that should be in place in the Final Rule to mitigate any future potential impacts to electric system reliability and therefore be clearly available to states and entities charged with ensuring bulk power reliability.”[31]

Operators in two of the most politically opposite states, New York and Texas, also raised concerns. The New York Independent System Operator wrote in comments to the EPA that “the Clean Power plan presents potentially serious reliability implications for New York” and that “[n]o amount of flexibility afforded in the manner in which New York State may seek to comply with the Clean Power Plan can make up for requirements that are inherently unreasonable because they are based on flawed assumptions in the Building Blocks.”[32] Similarly, the Electric Reliability Council of Texas (ERCOT) wrote that cutting fossil fuel generation out of the mix quickly could reduce reserve margins significantly, “leading to an increased risk of rotating outages as a last resort to maintain operating balance between customer demand and available generation.”[33]

State public utility commissions from every region of the country have stated unequivocally that warnings about reliability issues are not fearmongering about a new regulation with which they do not want to comply. The regulations present a real threat to grid reliability.[34]

In a letter to the EPA, commissioners of the Federal Energy Regulatory Commission (FERC) recommend using a Reliability Safety Valve through which states could petition for temporary waivers from the regulation to protect reliability.[35] The federal, regional, and state concerns regarding reliability combined with the high costs and insignificant benefits should be enough for Congress and the states to reject the climate regulations entirely.

Legal Challenges

Although neither regulation has become final, the EPA’s regulations for new and existing power plants have come under legal scrutiny. Industry and states will likely challenge the legality of the New Source Performance Standards (NSPS), most likely targeting the EPA’s assumptions about carbon capture and sequestration (CCS) technology. Legal experts have also raised concerns about the constitutionality of the Clean Power Plan and the EPA’s expansion of authority well beyond its statutory limits.

New Source Performance Standards. The EPA projects negligible cost impacts and emission reductions from NSPS because the EPA assumes that even in the absence of the regulation, electricity generators will choose other technologies, and that no new coal-fired units would be built without installing CCS technology—the only way that coal-powered electricity plants could meet the standards.[36] Section 111(b) of the Clean Air Act stipulates that NSPS must reflect “the best system of emission reduction” as adequately demonstrated by the EPA administrator. It is highly questionable whether CCS meets this standard.[37] Several news outlets have reported that the EPA will not include a CCS mandate because legal experts have pointed out its indefensibility.[38]

No credible basis exists to state that CCS is adequately demonstrated today since no large-scale power plant in the United States has CCS. Further, the need for sequestering the captured CO2 imposes geographic as well as economic constraints that make it a non-option in many areas. In Mississippi, for example, Kemper County’s Integrated Gasification Combined Cycle (IGCC) plant, which the EPA has used as a model for coal-fired plants around the U.S., has had nearly half a billion dollars in cost overruns even while receiving over $400 million in taxpayer-funded grants and credits. Yet the plant has not even begun to operate, further disqualifying it as a model for the rest of the nation.

As identified by the Obama Administration’s Interagency Task Force on Carbon Capture and Storage 2010 report, implementation of CCS has a number of extremely difficult obstacles to overcome. There are questions of technical scalability, regulatory challenges, long-term liability of storing the captured CO2, and above all, cost.[39] Even with taxpayer-funded financial handouts to CCS projects, building them will be prohibitively costly, which is why the EPA’s regulation of greenhouse gas emissions will effectively ban the construction of new coal-fired generating units. Whether or not the EPA uses the availability of CCS to justify its regulation for new power plants, CCS technology should be used only if companies believe it is in their economic interest to do so—for instance, if profitable opportunities for enhanced oil recovery exist nearby.

Clean Power Plan. The EPA’s Clean Power Plan is unlike any other regulations proposed or implemented, and legal scholars have brought a number of issues to the public’s attention. Perhaps the harshest and most influential critique came from Harvard University Professor of Constitutional Law Laurence Tribe. Tribe, a “liberal legal icon” who served in the Justice Department for President Obama’s first term, stated in testimony before the House Committee on Energy and Commerce that the “EPA is attempting an unconstitutional trifecta: usurping the prerogatives of the States, Congress and the Federal Courts—all at once. Burning the Constitution should not become part of our national energy policy.”[40]

The legal and constitutional concerns underscored by Tribe and other legal scholars have demonstrated that the Clean Power Plan:

    • Grossly exceeds the statutory authority of the EPA. The “outside the fence” building blocks, the parts of the plan that would allow increased renewable energy and efficiency mandates that the EPA uses as part of its compliance options, constitute blatant regulation beyond the EPA’s jurisdiction. Past EPA regulations set emissions limits based on the actual source of emissions (the power plant), as opposed to providing alternative scenarios to reduce greenhouse gas emissions that have nothing to do with the power plant itself. By providing states with the options of using more renewable energy, mandating energy-efficiency requirements or some other means (such as a carbon tax or regional cap-and-trade), the EPA is not just regulating the emissions of a single source, but re-engineering America’s energy economy and thus interfering with decisions that the private sector should undertake and that should be regulated largely at the state and local level. Moreover, the EPA is using such wide-ranging authority in setting emissions-reduction targets by setting standards for an entire state—not just the source of emissions.[41]
    • Violates the principles of federalism. The Clean Power Plan extends far beyond the “cooperative federalism” role the states are supposed to have with the EPA. Cooperative federalism intended the EPA to set a national standard on an emissions rule and allow the states to administer and implement the regulation in the most cost-effective way. Instead, the EPA is forcing states to implement plans against their will, a clear violation of the anti-commandeering principle. As Tribe writes, the “EPA’s plan confronts the States with an unforeseeable choice and essentially remakes the agreement between them and the Federal Government that has existed since the Clean Air Act was enacted in 1970.”[42]Tribe continues, “It would require States to base their energy and emissions policies on the needs of other States (and even other nations, such as Canada) with which they are inextricably linked through the power distribution system—the national power grid.”[43]
    • Unconstitutionally coerces states with federal strings and violates the Spending Clause. In the proposed Clean Power Plan, the EPA threatens states with the loss of highway funds for failure to comply. In NFIB v. Sebelius, the Supreme Court established criteria for what constitutes coercion: The federal grant money must be substantial, the condition imposed must be on an entrenched program, and the condition imposed must affect a different regulatory program (greenhouse gas emissions from existing power plants) than the entrenched program (highway funding).[44] The EPA’s legal authority to inflict punishment on states for rejecting the agency’s climate regulations could be significantly limited.[45] As environmental legal scholar Jonathan Adler writes,

For many states, federal highway funds represent the lion’s share of their transportation budget. As a consequence, threatening to take highway funds may strike some courts as unduly coercive under NFIB. In the 1980s the Supreme Court upheld conditioning five percent of a state’s highway funds on setting a 21-years-old drinking age. Under the Clean Air Act, however, a state can lose all highway funds, save those that will reduce emissions or are necessary for traffic safety, for failure to adopt a complete pollution control plan that satisfies the federal EPA.[46]

  • Double-regulates existing power plants, which the Clean Air Act prohibits. The EPA regulates existing coal-fired power plants under section 112 of the Clean Air Act with the Mercury Air and Toxics Standards (MATS). Combined with the Cross State Air Pollution Rule, these two massive regulations have forced the retirement or planned retirement of 72 gigawatts of electrical generating capacity, enough to power nearly 45 million homes.[47] Despite the EPA’s best efforts to skirt around this issue, Section 111(d) of the Clean Air Act explicitly prohibits the EPA from regulating the same source and thus also precludes the Clean Power Plan.[48] The Supreme Court recently delivered a setback to the EPA’s MATS to regulate emissions from coal and oil-fired power plants. The Clean Air Act directs the EPA to reduce air pollutants if the agency deems the regulation “appropriate and necessary.” The Court ruled that the agency failed to consider costs in their determination.[49] The Supreme Court handed a victory to Americans concerned with unelected bureaucrats driving up energy costs by overturning a costly environmental regulation that lacks any meaningful direct environmental benefit.

Many legal concerns exist and the challenges will make their way to court; however, Congress and states should not wait on the courts to act. If states wait on a court decision, the process will already be in motion to close many of the existing fleet of power plants with little to no hope of re-opening them. Both Members of Congress and state officials should fight the entirety of the regulation, not settle for a slightly more palatable version that will still bring injurious economic results and no climate or environmental benefit.

Congress and States Should Reassert Their Power

No matter what the EPA’s final regulation looks like and no matter whether states choose to develop their own plans, states will face extraordinary challenges instituting and operating under such constraints. Many states face unworkable timeframes to implement plans and to coordinate actions among all affected parties including public utilities commissions, environmental regulators, electric cooperatives, municipal utilities, state legislative bodies, and many others. Additionally, states will have to agree on a pathway to achieve compliance, which will prove to be difficult. Inevitably, special interests will make their case for carve outs, handouts, and specific protections—dispersing the costs to the families and businesses as energy consumers.[50]

Officials in 32 states, including governors, attorneys general, and state legislators have opposed the Administration’s carbon dioxide regulations.[51] With regard to the Clean Power Plan, 18 state attorneys general warned that the “EPA, if unchecked, will continue to implement regulations which far exceed its statutory authority to the detriment of the States, in whom Congress has vested authority under the Clean Air Act, and whose citizenry and industries will ultimately pay the price of these costly and ineffective regulations.”[52] State officials should use their authority to reject the EPA’s proposal for new and existing power plants altogether, not fall victim to “flexible” state plans that would merely disguise the costs through mechanisms that increase prices and restrict choices. Furthermore, the Supreme Court’s ruling on MATS should raise a red flag for states. Why should the states go down a path similar to MATS—implementing costly plans that close power plants, destroy jobs, and curb economic growth for no direct environmental benefit—only to have a court decision rein in the regulatory overreach?

Congress must reassert its power. Senator Shelley Moore Capito (R–WV) introduced the bipartisan Affordable Reliable Electricity Now Act of 2015 and Congressman Ed Whitfield (R–KY) introduced the bipartisan Ratepayer Protection Act of 2015 that would effectively prohibit the EPA from imposing costly rate hikes on Americans and return authority to the states.[53] Congress should also:

  • Approve resolutions of disapproval (under the Congressional Review Act) of the EPA’s greenhouse gas rules for power plants.
  • Clarify in statute that the Clean Air Act does not apply to the regulation of greenhouse gas emissions or other climate-related rulemaking.
  • Prevent the EPA and all other federal agencies from regulating greenhouse gas emissions, including prohibiting funding from being used for implementation.
  • Force the EPA to withdraw its endangerment finding on greenhouse gas emissions, recognizing that greenhouse gas emissions are affecting the climate but that no credible evidence exists to suggest that the earth is heading toward catastrophic warming or that climate regulations will affect global temperatures.

Just Say No

President Obama’s climate plan would have a chilling effect on the economy, not the climate. As the EPA finalizes regulations for new and existing power plants, the restriction of opportunities for Americans to use such an abundant, affordable energy source will only bring economic pain to households and businesses, with no environmental benefit to show for it. Lawmakers and state officials should exercise leadership and reclaim their authority from the unelected bureaucrats whose regulatory ambitions threaten economic growth and individual prosperity.

—Nicolas D. Loris is Herbert and Joyce Morgan Fellow in the Thomas A. Roe Institute for Economic Policy Studies, of the Institute for Economic Freedom and Opportunity, at The Heritage Foundation.

See the article here.

Clean Power Plan Could Push Millions of Minority Americans Into Poverty

Via The Washington Times: 

This summer the Environmental Protection Agency (EPA) will finalize its carbon-dioxide emission regulations under President Obama’s Clean Power Plan. The EPA’s own data projects the regulations will reduce global carbon by less than 1 percent and sea level rise by one one-hundredth of an inch. The price Americans will pay for these “benefits” is layoffs and increased energy rates. Yet for the nation’s most vulnerable, the impacts will be far worse, pushing millions into poverty.

Proposed in June 2014, the Clean Power Plan imposes emission reduction targets on each state, with some facing targets as high as 50 percent and 70 percent. The problem is such aggressive targets are simply unattainable. This will force states to close power plants and use inefficient energy sources, causing hundreds of thousands of layoffs and double-digit rate increases in more than 40 states.

While the impacts of the regulations will harm the nation as a whole, job losses and rate increases will be particularly devastating to those already struggling under the president’s failed policies.

A recent report by the National Black Chamber of Commerce found the impact of the president’s and the EPA’s proposed regulations on minority communities would be devastating. The report focused on job losses, reductions in household income and increased poverty rates.

The chamber found that implementation of the EPA regulations would result in the loss of an increasing number of African-American and Hispanic jobs. In 2020 alone, 200,000 African-American jobs are projected to be lost, with Hispanics suffering more than 300,000 job losses. By 2035, the cumulative job losses for African-Americans would total nearly 7 million and for Hispanics over 12 million.

The report further found the EPA’s regulations would decrease median household income for African-Americans by more than $5,000 over the next 20 years. For Hispanic Americans, the losses would exceed $7,000 during the same period.

Such debilitating losses would force many African-American and Hispanic families to choose between necessities such as food, housing and medical care. For example, housing-cost burdens are 30-40 percent higher for African-Americans and Hispanics when compared to whites, a burden that will only grow under EPA rules.

Most disturbing is the impact the regulations would have on poverty rates. As a result of job losses, increased costs and declining income, the poverty rate for African-Americans is projected to increase more than 23 percent. Hispanic poverty would see an even higher increase of over 26 percent.

Thus, an overlooked consequence of the proposed regulations is millions of African-American and Hispanic Americans will be thrust below the poverty line, many of whom just recently worked their way out.

In any other scenario, such a disparate impact on minority groups in America would be cause for national outcry. Sadly, the EPA and the president conveniently overlook these impacts when their legacies are on the line.

Obviously for Mr. Obama and the EPA, a reduction in global carbon dioxide of less than 1 percent is worth forcing millions of Americans into poverty. Given the nearly non-existent benefits of these regulations, one can only ask what is really driving the issue, because it certainly isn’t the health and well-being of the American people.

See the article here.

Pence Wants States to Join EPA Rules Fight

Via Pal-Item:

Fighting the federal government over proposed greenhouse gas rules for power plants is worth the legal costs, Gov. Mike Pence said Thursday in a news conference with an industry advocacy group aimed at encouraging more states to follow his lead.

“We do have a choice,” Pence said. “You can refuse to submit a state plan. You can challenge the EPA’s ability to impose a federal plan. There’s nothing illegal about saying ‘no’ on behalf of rate payers and businesses in your state.”

If enough states do that, the Environmental Protection Agency will be forced to capitulate, said Tom Pyle, president of the American Energy Alliance.

“The sheer enormity of having to potentially deal with a dozen or so federal implementation plans would overwhelm the EPA to the point where they would probably have to throw up their hands,” said Pyle.

Pence informed President Barack Obama in a letter last month that he would refuse to comply with the pending rules, unless they are substantially changed.

The rules, which are expected to be finalized this summer, are the cornerstone of the administration’s plan to curb climate change.

If states refuse to comply, the EPA has said it will impose its own plan. But that would delay implementation, even without the legal challenge Pence says he’s committed to make.

“We think we’ve got a strong opportunity to defend ratepayers, and I think it would be worth the fight,” he said about the cost of litigation.

Under the initial proposal, Indiana would have to reduce its emissions rate 20 percent by 2030.

The EPA has estimated that could be done by increasing plant efficiency, reducing energy demand through energy efficiency programs, switching to renewable energy sources and using natural gas instead of coal, which sends more carbon dioxide into the atmosphere for the amount of energy produced than any other energy source.

Complying would raise rates in the region that includes Indiana by about 6 percent in 2020, the EPA estimates. By 2030, as the cost of making energy improvements and other efficiencies begins to pay off, the increase in rates due to the rule is projected to be less than 1 percent, according to the EPA.

Pence — who called Indiana a “proud pro-coal state” — said he questions the EPA’s estimates, and believes electricity rates would rise dramatically. A report for industry groups says costs would rise an average 12 percent.

Republican governors from Oklahoma, Wisconsin, Texas and Louisiana have indicated they will also defy the regulations.

On the other side of the spectrum, the Analysis Group of Boston is scheduled to release a report next week showing the economic benefits enjoyed by a group of Northeastern states that have already reduced carbon dioxide emissions through an emissions trading program. Closer to Indiana, Michigan GOP Gov. Rick Snyder is trying to make his state a national leader in revamping its energy portfolio to reduce its use of coal.

The Obama administration argues that failing to address climate change will hamper economic growth and put the health and well-being of Americans at risk from extreme weather events, wildfires, poor air quality, and illnesses transmitted by food, water, and disease carriers such as mosquitoes and ticks.

“Climate change is actually impacting the economy today,” EPA Administrator Gina McCarthy told a congressional panel Thursday. “If you look at action on climate and see the kind of economic benefits it can provide that will not just protect us from escalating carbon, but grow a low-carbon future with new jobs, that is the goal post that all of us are looking for.”

See the article here.

Supreme Court Decision Could Resurrect Coal Plants

Via The Washington Examiner: 

The Supreme Court’s decisive blow against the Environmental Protection Agency’s pollution rules could bring coal-fired power plants back from the brink.

But not before a lot more legal action that could take months to wrap up.

The high court on Monday ruled 5-4 that the EPA cannot simply ignore compliance costs in enacting strict power plant rules for mercury and acid gases that are forcing utilities to close dozens of coal plants.

“The decision effectively puts EPA on notice: reckless rulemaking that ignores the cost to consumers is unreasonable and won’t be tolerated,” said Hal Quinn, the National Mining Association’s president and CEO. “It recognizes what the administration has ignored: that every regulatory benefit comes with a cost, and the value of that benefit cannot be known unless its costs are considered.”

Nevertheless, the real world impact of the Supreme Court’s decision may take months to figure out. That’s because Monday’s decision begins a new legal process that most likely will be put off until after Labor Day, as the matter of EPA’s cost assessment goes back to the D.C. Circuit Court of Appeals, where the issue will have to be fought again, say mining association officials and legal experts.

“This will not be something that will happen quickly,” said Luke Popovich, the mining association’s vice president for external affairs. “We aren’t looking to see anything until Labor Day.”

After the defeat, the mining association and others asked the Supreme Court to take up the court’s decision to address the cost issue. So, although the Supreme Court decision does not kill the pollution rule, it does direct the appeals court to re-examine the matter, requiring the EPA to assess the rule’s compliance costs.

The EPA ignored the compliance costs in assessing the need for the regulations, arguing it has the discretion not to consider the costs. But the Supreme Court decision eviscerated that argument.

It gets more complicated. “Others will argue that the rule should only be stayed for plants that received compliance extensions [under the rule] and do not need to come into compliance until April 2016 — A number of plants are scheduled to be shut down at that time,” Holmstead said.

Nevertheless, he said he believes it will be difficult for the EPA to “insist that more plants should be forced to shut down before EPA goes back and reconsiders” the cost of the rule, suggesting that the agency will likely agree to some sort of stay before next year’s round of plant closures.

Jonathan Martel, a partner with the law firm Arnold & Porter, said that how far Monday’s decision goes depends on what the D.C. Circuit court does in response. “First, assuming that the D.C. Circuit vacates the rule pending an EPA ‘redo’ of its mercury regulations, any plants that have not yet invested in controls would not have to proceed.

“Many coal-fired power plant closures were announced due to the costs of compliance with this rule, and though most compliance and closure decisions may now be irreversible, there might be some for whom this will matter a lot,” Martel said.

But Popovich and others say the rule continues to be law, and although the EPA may choose to halt the rule temporarily, much remains to be seen.

Nevertheless, environmentalists say the EPA is prepared to issue a cost assessment rapidly and could wrap up the issue quickly.

Earthjustice, a nonprofit environmentalist group representing respondents in the case, said the ruling in no way affects the rule’s implementation. It does say that the EPA and the D.C. Circuit Court must take some remedial action to address the cost issues, but that the EPA should be able to deliver that in short order.

“The court decided that EPA erred, but the court did not strike down or block the MATS standards,” Earthjustice spokesman Phillip Ellis said. “The standards were already in effect, and are still in effect after today’s decision, pending further review by the D.C. Circuit and EPA. The court also left it up to EPA to decide how to consider cost on remand, as long as EPA acts reasonably.”

Conservative Justice Antonin Scalia, who wrote the majority decision, said he does not agree with environmental groups that argue in favor of EPA on the grounds that the rule’s “ancillary benefits” outweigh the cost of compliance. Ancillary benefits would include the public health benefits from reducing harmful pollution and mercury.

That is an argument that the four court justices who opposed Monday’s decision reiterated in dissenting opinions.

“Some of the respondents supporting EPA ask us to uphold EPA’s action because the accompanying regulatory impact analysis shows that, once the rule’s ancillary benefits are considered, benefits plainly outweigh costs. The dissent similarly relies on these ancillary benefits when insisting that ‘the outcome here [was] a rule whose benefits exceed its costs,'” Scalia wrote.

He reminded the dissenting justices and respondents that “we may uphold agency action only upon the grounds on which the agency acted.” The ancillary effects of the rules cannot be calculated appropriately in measuring these costs, he said.

“Even if the agency could have considered ancillary benefits when deciding whether regulation is appropriate and necessary — a point we need not address — it plainly did not do so here,” Scalia said.

Meanwhile, Republicans on Capitol Hill said they were encouraged by the decision and will continue to try to rein in the EPA.

House Science, Space, and Technology Committee Chairman Lamar Smith of Texas said the decision “is an important step towards reining in the actions of the EPA.”

Sens. David Vitter, R-Louisiana, and Shelley Moore Capito, R-W.Va., also said the decision underscores the need for greater oversight of EPA regulations, and the need to hold the agency accountable.

See the article here.

State Utility Commissions Should Fight the Clean Power Plan

Via The St. Louis Post-Dispatch: 

In my six years of service on the Missouri Public Service Commission, I fought hard to keep electricity rates affordable and stable for the people of Missouri. But the Environmental Protection Agency’s new Clean Power Plan threatens to unravel years of hard work by myself and other state commissioners and saddle electricity consumers with unreasonable costs — not just in Missouri, but across the country.

Fortunately, more and more people are recognizing the danger. Senate Majority Leader Mitch McConnell, R-Ky., is calling on state legislatures to reject the EPA’s costly and legally dubious plan. His call has been taken up by other state utility regulators as well.

I support it, too, and I urge Missouri’s current commissioners to do the same. Our primary duty is to ensure that utilities’ investments are “prudent,” which they certainly would not be under the EPA’s plan.

They must take a stand now, while there’s still time to act. As soon as the final Clean Power Plan is unveiled this summer, many utilities will start implementing it immediately despite a bevy of outstanding legal challenges to the regulation. If they are allowed to proceed, it will be impossible to put the genie back in the bottle if the courts strike some or all of the regulation down.

In gauging the prudence of the Clean Power Plan, we must ask two important questions, one economic and one legal.

First, does the rule make economic sense? State commissioners are responsible for ensuring that electricity rates are just and reasonable, meaning investments by utilities must provide positive economic value relative to the higher electricity rates it will require.

This is far from certain. Economywide, the cost of the Clean Power Plan could reach as high as $479 billion over 15 years. In Missouri, our electricity costs are estimated to increase by between 12 percent and 22 percent. Ameren, a utility company operating in our state, alone estimates an increase of $4 billion in rate hikes for its Missouri customers if the EPA’s proposed plan takes effect.

While this will cripple many working families, it is actually good news for utility companies. For them, higher costs mean higher rates and bigger profits. Given these backward incentives, it is the role of state utility commissioners to protect consumer interests.

The second question is: Do the legal challenges to the Clean Power Plan have any merit? Short answer: yes.

More than a dozen states are suing the administration over the regulation. Eminent legal scholar Laurence Tribe of Harvard Law School, who taught constitutional law to President Barack Obama, has gone to great lengths to highlight the unconstitutionality of the rule. If Tribe is right, any efforts by utilities to comply with the rule would ultimately be for naught. How could the high costs associated with a pointless effort be prudent?

This isn’t mere speculation — other legally questionable EPA rules show the danger of implementation before the courts have had their say.

The U.S. Supreme Court decision last month in Michigan v. EPA is a perfect example. Twenty-three states sued the EPA to stop its Mercury and Air Toxics Standards, a 2012 regulation that imposed unnecessarily strict limits on permissible mercury and other emissions from power plants. The court agreed the EPA failed to properly consider the regulation’s costs — which at $9.6 billion was then the most expensive regulation in history — and sent the EPA back to the drawing board.

Yet while this lawsuit was winding its way through federal court, power plants went ahead with implementation. As of January this year, it had already been credited with shutting down 61,000 megawatts of electricity — more than enough to power every home in Missouri — and raised electricity rates across the country. Thus despite the Supreme Court ruling this regulation is invalid, it is too little too late for the millions of Missourians who are already burdened with higher electricity costs.

Missouri’s public service commissioners cannot allow the Clean Power Plan to follow this pattern. They should act quickly to bar utilities from saddling their customers with higher electricity rates, at least until the various legal challenges are resolved. As a former commissioner myself, I can safely say there is no more prudent path.

Terry M. Jarrett is an attorney with Healy Law Offices LLC. He previously served as a Missouri Public Service commissioner and as chairman of the National Association of Regulatory Utility Commissioners’ Committee on Critical Infrastructure.

See the article here.

Stopping EPA Uber Alles

Via The Wall Street Journal:

The Supreme Court scolded the Environmental Protection Agency last week for bombing Dresden, albeit long after the bombs fell. In 2011, the year the EPA proposed the anticarbon mercury rule that the Court has now ruled illegal, some 1,500 fossil-fuel-fired electric units were in operation. Only about 100 have not already closed or complied at a cost of billions of dollars.

Oklahoma Attorney General Scott Pruitt is hoping to prevent a replay on the EPA’s new Clean Power Plan, which will demand another 30% carbon reduction, on average, from the states. The rule was proposed by the EPA in June 2014 and is expected to be final by the end of this summer. The challenge Mr. Pruitt filed last week is a test of whether the snail’s pace of the judicial process in response to new rules lends de facto immunity to whatever the EPA wants to do, even if the conclusion is another legal defeat that arrives too late to make a practical difference.

The EPA is counting on it. The agency knows that the Clean Power Plan’s precarious legal footing will be litigated for years, but it is trying to rush the rule out to make it a policy fait accompli before President Obama’s term expires. It also knows that the long lead time and investment decisions the plan compels—about power-plant retirements and upgrades, restructuring transmission lines, creating new green energy and efficiency subsidy programs—must begin today. Or better yet for the agency, yesterday.

Under traditional regulatory review, the appellate courts rarely put a stay on new EPA rules, even if states and utilities can show that they are causing irreparable and irreversible harm. The EPA is instructing Oklahoma to cut carbon emissions by 33% to meet an “interim goal” as soon as 2020, which means the state must begin spending despite the legal uncertainty.

So Mr. Pruitt is moving for a preliminary injunction against the Clean Power Plan. Under the 1958 Supreme Court precedent Leedom v. Kyne and a subsequent line of cases, the courts can use their powers to block federal-government actions “when an agency exceeds the scope of its delegated authority or violates a clear statutory mandate.” Plaintiffs must show that they are injured by judicial delay and that they are likely to succeed on the merits.

Leedom actions have been used to stop abuses from the National Labor Relations Board and the Federal Trade Commission, and the EPA is a promising target. The agency’s unprecedented measures to restructure the U.S. energy economy under an obscure provision of the 1970s-era Clean Air Act have zero grounding in the text of the statute, much less Congress’s consent. Mr. Pruitt also argues that under the High Court’s federalism jurisprudence the EPA is unconstitutionally commandeering the sovereign states.

If Mr. Pruitt does succeed and obtain an injunction, the Clean Power Plan would be put on ice for the rest of Mr. Obama’s term, much as the Fifth Circuit blocked his executive immigration actions. More to the point, an injunction would rebuke an agency that thinks it is above the law.

See the article here.

Walker, Jindal Poised to Stonewall EPA on New Climate Regulations

Via Hot Air:

When the EPA lost their case against Michigan in the Supreme Court last month, we talked about how the administration can win even when they lose. They manage this by setting deadlines for regulatory compliance which arrive far faster than a challenge can make its way through the court system. Then, by the time the justices settle the matter, even if the EPA is found to have been in the wrong the states and the energy industry have already spent all the cash, diverted the resources and lost the energy off the grid because they didn’t want to fall out of compliance.

There are still more sweeping energy regulations coming down the pipeline and I was wondering if any of the states would take a cue from the Michigan case and begin telling the administration to cool their heels until their court challenges are heard. As it turns out, we didn’t have long to wait. As the new Clean Power Plan approaches, several GOP governors, including two who are running for president, appear to be ready to make a stand.

As President Obama prepares to complete sweeping regulations aimed at tackling climate change, at least five Republican governors, including two presidential hopefuls, say they may refuse to carry out the rules in their states.

The resistance threatens to ignite a fierce clash between federal and state authorities, miring the climate rules in red tape for years. The fight could also undermine Mr. Obama’s efforts to urge other nations to enact similar plans this year as part of a major United Nations climate change accord.

Republican strategists say that rejection of Mr. Obama’s climate policy at the state level could emerge as a conservative litmus test in the 2016 election. Two of the governors who have said that they might defy the regulations — Scott Walker of Wisconsin and Bobby Jindal of Louisiana — are among at least four Republican governors who are expected to vie for the presidential nomination.

Other governors who have issued threats over the rules include Greg Abbott of Texas, Mike Pence of Indiana and Mary Fallin of Oklahoma.

This is pretty much exactly what Mitch McConnell was urging the states to do earlier this year, a move which had the Left tagging him with all sorts of unpleasant labels. But now that Michigan has prevailed against the overreach of the EPA, some spines seem to be stiffening. (And, yes… in the case of Jindal and Walker, the fact that they are in the POTUS bear bit probably juices them up a bit.)

Of course there’s a bit of risk associated with the move. Assuming they do stand their ground and a deadline passes, the EPA can hit them with crippling fines and penalties better suited for Russia and Iran. One assumes that if they prevail in court those penalties would go away, but what happens if you lose? It’s a significant roll of the dice for the states, but I’m guessing at least some of them will take a run at it.

“The E.P.A.’s latest attempt at imposing burdensome regulations represents an unprecedented meddling with Texas in order to push the Obama administration’s liberal climate change agenda,” said Mr. Abbott, the Texas governor, who has met with Mr. McConnell about his effort to ensure that states do not submit climate change plans, and has announced that he will support the push.

Michael Reed, a spokesman for Mr. Jindal, said in an email: “The president’s Clean Power Plan undermines the role of states in the federal Clean Air Act in an effort to realize a radical, liberal agenda that will lead to increased energy costs. While we believe the proposed rule should be immediately withdrawn, we are considering all options to mitigate the damage if it becomes final, including not submitting a plan.”

In a letter to Mr. Obama, Governor Walker wrote that he feared the “staggering costs it would inflict on Wisconsin’s homes and businesses,” and added that absent major changes to the plan, “it is difficult to envision how Wisconsin can responsibly construct a state plan.”

Bold words from one and all. But it will be a while yet before we know if they will all walk the walk in addition to talking the talk. I’d put money on Abbott and Walker going to the mat. Jindal is a possibility, but he’s yet to show me that he’s in it for the long haul. I’d love to be proven wrong, though.

See the article here.

Forum: The EPA vs. Connecticut’s Minorities

Via The New Haven Register:

With the Obama administration only two months away from releasing its so-called “Clean Power Plan,” much debate has focused on the supposed benefits of cutting U.S. greenhouse gas emissions over the next 15 years. Lost amid the rhetoric, however, is the economic hardship it will impose on millions of working families — especially the 784,000 blacks and Hispanics living in Connecticut.

That’s the finding from a new study commissioned by my organization, the National Black Chamber of Commerce. In summary, this regulation will leave minority communities with disproportionately fewer jobs, lower incomes, and higher poverty than whites. Thus, while the administration calls its regulation a “justice issue” for minorities, its actual effects will amount to a severe injustice — and state lawmakers should act before it’s too late.

It’s important to understand why the impact will be so severe. For one, the regulation — which is enforced by the Environmental Protection Agency — will shutter much of our existing energy grid. The new facilities will necessarily cost more, and also rely on more expensive energy sources. Our study estimates this transformation will increase annual electricity costs by $565 billion in the coming years.

Ultimately, these higher costs will be passed on to families in the form of higher electricity bills and higher prices at every store.

This is especially harmful to blacks and Hispanics. Right now, blacks spend 50 percent more of their family incomes on utilities than whites, while Hispanics spend 10 percent more. This regulation will exacerbate these disparities, increasing the energy burden on both blacks and Hispanics by around 35 percent.

Then there’s the matter of lost income and lost jobs.

Broadly speaking, minorities typically have lower-paying jobs that are most vulnerable to regulatory cost increases. Ours are the first to be affected when business costs rise, such as the higher electricity bills this regulation will bring about.

Our study estimates cumulative job losses for blacks and Hispanics of 2.2 million and 3.8 million, respectively, over the next decade. We also estimate reduced household incomes for blacks and Hispanics by a respective $455 and $515.

These three effects — higher energy bills, fewer jobs, lower incomes — will lead to greater hardships on families already struggling to get by. Our study estimates the regulation will increase black and Hispanic poverty rates by 23 percent and 26 percent, respectively.

We simply cannot afford this. While we’re working hard to pursue the American Dream and give our children the best shot at a better life, the EPA is pushing us even further down the ladder of opportunity.

Connecticut state lawmakers must act to prevent this from happening. Some already are: Fourteen states already have fought the regulation in federal court, where their arguments enjoy bipartisan support.

While that’s a good start, governors and state legislators should act, too. The regulation requires that un-elected state environmental agencies draft implementation plans and submit them directly to the EPA. This completely sidesteps Connecticut’s elected representatives and eliminates accountability from voters.

There are two ways to fix this problem. Governors can issue executive orders prohibiting their environmental agencies from submitting plans to the EPA. State legislators can pass legislation to the same effect. Either option ensures that elected officials, as representatives of the people, have the final say over what happens to their constituents.

These are commonsense and simple solutions that could prevent the impending burdens facing millions of black and Hispanic families: fewer jobs, lower incomes, higher costs, and more poverty. Connecticut lawmakers should do everything in their power to prevent that from happening.

Harry C. Alford is president and CEO of the National Black Chamber of Commerce.

See the article here.

 

 

Republican Governors Signal Their Intent to Thwart Obama’s Climate Rules

Via The New York Times:

WASHINGTON — As President Obama prepares to complete sweeping regulations aimed at tackling climate change, at least five Republican governors, including two presidential hopefuls, say they may refuse to carry out the rules in their states.

The resistance threatens to ignite a fierce clash between federal and state authorities, miring the climate rules in red tape for years. The fight could also undermine Mr. Obama’s efforts to urge other nations to enact similar plans this year as part of a major United Nations climate change accord.

Republican strategists say that rejection of Mr. Obama’s climate policy at the state level could emerge as a conservative litmus test in the 2016 election. Two of the governors who have said that they might defy the regulations — Scott Walker of Wisconsin and Bobby Jindal of Louisiana — are among at least four Republican governors who are expected to vie for the presidential nomination.

Other governors who have issued threats over the rules include Greg Abbott of Texas, Mike Pence of Indiana and Mary Fallin of Oklahoma.

The governors’ actions have come after the Senate majority leader, Mitch McConnell, Republican of Kentucky, opened a campaign earlier this year urging all governors to refuse to carry out the climate change rules.

Mr. McConnell sent a letter to every governor in March, and he has continued his push in meetings and phone calls. In addition, his staff has been working closely with regulators and environmental officials in many state governments, helping them shape legal strategies to block the rules.

“As governors begin to seriously look at what these plans will look like, we expect more and more governors will follow Senator McConnell’s lead,” said Robert Steurer, a spokesman for Mr. McConnell.

The fate of Mr. Obama’s climate change agenda, which he hopes will be a cornerstone of a major environmental legacy, depends heavily on the compliance of state governments.

Last year, the Environmental Protection Agency unveiled a draft regulation that stands at the heart of the president’s efforts to fight global warming. The proposed rule assigns each state a level by which it must reduce its planet-warming carbon emissions from electric power plants. Under the rule, which the administration expects to release in its final form in August, every state will have one year to draft a customized plan detailing how it will comply.

States, for example, could submit plans to shut down heavily polluting coal plants, replacing them with natural gas plants and wind, solar and nuclear power generators, and to improve energy efficiency in buildings. They could also enact taxes on carbon pollution, or join regional “cap and trade” programs, which require companies to pay for government-issued pollution permits.

The White House envisions the plan as a trigger that will prompt a transformation of the American electricity system, shifting it from dependence on fossil fuels to a reliance on renewable and low-carbon energy sources.

But some governors call the proposal a federal intrusion on their authority.

“The E.P.A.’s latest attempt at imposing burdensome regulations represents an unprecedented meddling with Texas in order to push the Obama administration’s liberal climate change agenda,” said Mr. Abbott, the Texas governor, who has met with Mr. McConnell about his effort to ensure that states do not submit climate change plans, and has announced that he will support the push.

Michael Reed, a spokesman for Mr. Jindal, said in an email: “The president’s Clean Power Plan undermines the role of states in the federal Clean Air Act in an effort to realize a radical, liberal agenda that will lead to increased energy costs. While we believe the proposed rule should be immediately withdrawn, we are considering all options to mitigate the damage if it becomes final, including not submitting a plan.”

In a letter to Mr. Obama, Governor Walker wrote that he feared the “staggering costs it would inflict on Wisconsin’s homes and businesses,” and added that absent major changes to the plan, “it is difficult to envision how Wisconsin can responsibly construct a state plan.”

Given the volatile politics, the Obama administration is preparing for some states to reject the proposal. The E.P.A. is drafting a model state-level plan to have at the ready if states refuse to submit their own plans.

Administration officials say it is in states’ interest to design their own plans, which would be customized to meet the needs of their local and regional economies.

“E.P.A. has an obligation under the Clean Air Act to develop a model federal plan, something that many states have asked E.P.A. to do so it can provide an example for states developing their own plans,” said Thomas Reynolds, a spokesman for the agency. “E.P.A.’s strong preference is to approve state plans, but we know that setting out a federal plan is an important step to ensure that our Clean Air Act requirements are fulfilled.”

Environmental policy experts say that the federal government could ultimately force a policy created in Washington on the economies of each state. But that could mean the process would be extended for years.

“If the federal government has to enforce this program if the state is unwilling or unable to comply, it will drag out the process, exacerbate the challenges, and make implementation that much more difficult,” said William Becker, the executive director of the National Association of Clean Air Agencies.

But for presidential candidates promoting their conservative credentials, highlighting the difficulties of federal regulation may be precisely the point.

Michael McKenna, a Republican energy lobbyist and political strategist, has advised governors to reject the plan.

“When this rule is final, people are going to have to say whether they’re in favor of it or against it, and political activists, voters in Republican primaries, are going to look at it,” he said. “It’s going to be on the test.”

See the article here.

EPA Rules Would Hurt Lower-Income: My Word

Via the Orlando Sentinel: 

I’m the president of the Southern Christian Leadership Conference, co-founded by the Rev. Martin Luther King, Jr. Many people forget that King advocated for poor families, regardless of their race or religion, and I believe that he would find it troubling today to see that millions of Americans are still struggling to find financial security.

As if these everyday realities weren’t enough, families may soon face an unexpected jump in their monthly utility bills. That’s because the U.S. Environmental Protection Agency is proposing new energy regulations as a step toward addressing climate change. Specifically, the EPA wants to curb carbon-dioxide emissions from coal-burning power plants, and wants governors across the country to close the coal-fired plants in their states.

This is not a climate issue. Instead, what’s at stake is access to affordable power, especially for the most vulnerable segments of society. Paying for electricity is not a discretionary expense. The poor and the elderly on fixed incomes already pay an outsized portion of their limited budgets in order to have heat in the winter and air conditioning in the summer. And they already have fewer dollars to pay for these necessities.

I understand the intentions of the EPA plan, but we already have it within our power to move toward a cleaner environment without causing harm to lower-income Americans. Advanced technologies are already helping us to achieve lower emissions. And U.S. power plants are already far cleaner than factories and power plants in Asia.

We can get to a cleaner environment without victimizing those who are already struggling financially. And so, before the EPA adopts these measures, it should think twice about pursuing extreme rules that could bring great pain to hard-working, everyday Americans.

Charles Steele Jr. is president and CEO of the Southern Christian Leadership Conference, a civil-rights organization co-founded by the Rev. Martin Luther King Jr.

See the article here.

The Lesson We Should Take from Michigan v. EPA

Via Hot Air: 

There was some partying taking place in the energy sector after the Supremes delivered their smackdown to the EPA on Monday, and rightly so. The overreach attempted by the agency which delivered a crushing economic blow to a large, vital segment of the nation’s infrastructure was a dark harbinger of things to come if extra-legislative rules were allowed to go unchallenged. But while it may provide reason for hope in the future it’s clearly too soon to celebrate. The reason is that pretty much the entire energy sector – particularly the coal industry in this case – will tell you that the damage from the EPA’s Mercury and Air Toxics Standards (MATS) was already done. Rather than facing the wrath of Uncle Sam, most producers were browbeaten into incorporating the expensive (and frequently overblown) changes to avoid penalties rather than waiting for the outcome of a court case which was anything but certain.

Environment & Energy Publishing summarized how this played out, noting how this should be a reminder to the states to not just bow down to the EPA when they know they are in the right.

“While much of the damage of this regulation has already been done, the ruling serves as a critical reminder to every governor contemplating the administration’s demands to impose more regressive — and likely illegal — regulations that promise even more middle-class pain,” said Senate Majority Leader Mitch McConnell (R-Ky.). “Clearly, there is no reason to subject their states to such unnecessary pain before the courts have even had a chance to weigh in, especially if the Supreme Court simply ends up tossing the regulation out as we saw today.”

The key point here is that much of the damage of this regulation has already been done. And if you think that the green energy warriors don’t know this already you’re missing one of the biggest weapons in their took kit. Both the EPA and the Sierra Club were still looking smug even after the ruling because they nearly knocked out the opponent before losing the decision on the judges’ cards.

EPA expressed disappointment at the ruling but noted that the regulation “was issued more than three years ago [and] investments have been made and most plants are already well on their way to compliance.”

The Sierra Club agreed that the ruling couldn’t reverse decisions energy companies have already made to comply.

“Practically speaking, today’s decision won’t revive the fortunes of Big Coal or slow down our nation’s transition to clean energy,” said Mary Anne Hitt, director of Sierra Club’s Beyond Coal Campaign. “Most utilities have long since made decisions about how to meet the standard. Only a few dozen coal plants are still operating today with no pollution controls for mercury and air toxics and no clear plans to install them.”

Make no mistake… the carbon rules are on the way. The President isn’t going to let the clock run out on his fourth quarter without trying to get some form of sweeping, anti-carbon regulations through. And having seen how many coal plants they managed to shut down through illegal regulations simply by shoving them through faster than the court system could respond, there’s no reason to think they won’t do it again on carbon. McConnell is right. Governors around the country should be taking a unified stand in light of the Michigan ruling and refusing to establish any new carbon standards until the inevitable court challenge has made its way through the system.

See the article here.

Counterpoint: A Win for Power Plants and Consumers

Via The Chicago Sun-Times:

Monday’s decision by the U.S. Supreme Court regarding power plant emissions is a welcome vindication of common sense that is missing in much of the Obama administration’s regulatory actions.  The high court effectively put the nation’s regulator ­in ­chief on notice that ignoring the costs of its actions is neither reasonable nor appropriate and won’t be tolerated.

This is precisely what the Environmental Protection Agency failed to do in its power plant regulation. As Justice Antonin Scalia noted in his majority opinion, “It is not rationale, never mind ‘appropriate,’ to impose billions of dollars in economic costs in return for a few dollars in health benefits.”

Legal scholars may debate the meaning of these words for future EPA actions. But most Americans would view them as a common sense admonition. In our everyday lives, most of us recognize what regulators too often ignore: that every benefit comes with a cost, and the value of that benefit cannot be known unless its costs are considered.

In this case, EPA was willing to impose costs of $10 billion per year on consumers for benefits worth only $4 ­to $6 million. Equally unreasonable: Half the costs come from regulating emissions for which EPA found no health risks. In fact, power plants have already achieved significant reductions in mercury and other emissions thanks to new control technologies, begging the question if this rule, among the costliest ever, was necessary in the first place.

This decision is not just a win for power plants and households that depend upon affordable and reliable electricity. It is also a timely warning to governors now being asked to accept EPA’s proposal for reducing greenhouse gas emissions. Energy experts say that rule will be even more costly for state economies; legal experts now have more reason to claim it is also unlawful.

Hal Quinn is president and CEO of the National Mining Association

See he article here. 

Oklahoma Attorney General Challenges EPA’s Clean-Air Plan

Via kjrh.com:

OKLAHOMA CITY (AP) — A plan by the U.S. Environmental Protection Agency to reduce emissions from coal-fired power plants would threaten the reliability and affordability of electricity and cause substantial economic injury to the state, Attorney General Scott Pruitt claims in a federal lawsuit filed on Wednesday.

The lawsuit in federal court in Tulsa argues the EPA’s Clean Power Plan exceeds its authority and seeks an injunction that would prohibit the federal agency from regulating coal-fired electricity plants in Oklahoma.

“The EPA is ignoring the authority granted by Congress to states to regulate power plant emissions at their source,” Pruitt said in a statement. “The Clean Power Plan is an unlawful attempt to expand federal bureaucrats’ authority over states’ energy economies in order to shutter coal-fired power plants and eventually other sources of fossil-fuel generated electricity.”

A telephone message left after hours on Thursday with an EPA spokesman in Dallas was not immediately returned.

Last year, President Barack Obama rolled out a plan to reduce earth-warming pollution from power plants by 30 percent by 2030, setting in motion one of the most significant U.S. actions ever to address global warming. Once completed this summer, the rule will set the first national limits on carbon dioxide from existing power plants, the largest source of greenhouse gases in the U.S.

The administration says the rule is expected to raise electricity prices by about 4.9 percent by 2020 and spur a wave of retirements of coal-fired power plants.

Oklahoma Gov. Mary Fallin already issued an executive order in April prohibiting the state from developing a plan to reduce its carbon dioxide emission from power plants, and Indiana’s governor has said his state also will not comply.

And last month, the Republican-controlled U.S. House approved a bill that would allow states to opt out of the plan if its governor determines it would cause significant rate hikes for electricity or harm reliability of service.

See the article here.

Editorial: Supreme Court Hands EPA a Welcome Rebuke

Via The Charleston Daily Mail:

The Supreme Court’s decision earlier this week that the Environmental Protection Agency did not properly consider economic costs in its Mercury and Air Toxic Standards rule is rightly being hailed as a needed rebuke to an out-of-control administrative agency.

The MATS rule, requiring coal-burning power plants to reduce emissions of substances like mercury, lead and arsenic, is one of the most expensive EPA regulations ever produced.

The Supreme Court held that the agency should have taken the rule’s $6.9 billion in annual compliance costs into account in determining whether the rule was “appropriate and necessary.”

That massive cost dwarfed the rule’s actual benefits, which the agency said were only $4 to $6 million.

“It is unreasonable,” wrote Justice Antonin Scalia for the court, “to read an instruction to an administrative agency to determine whether ‘regulation is appropriate and necessary’ as an invitation to ignore cost.”

But this decision comes too late for the power plants that have already been shut down and the jobs that have been lost due to a now-discredited rule.

The EPA boasted after Monday’s decision that 70 percent of the coal industry has already complied with MATS. The industry had no choice but to accept the rule’s legality — and to assume all the cost burdens it imposed — while the rule made its tortuous three-year trip through the federal court system.

In that sense, the biggest lesson from this case is that the EPA must not be allowed to continue its strategy of “regulation by inertia” — proposing legally dubious regulations and betting that even if they’re struck down years later, industry will be cowed into complying in the meantime.

Under that strategy, even when EPA loses on the law, it wins in substance. And each time that happens, the agency is emboldened to try ever more aggressive and contorted legal theories to transform the nation’s economy without legislative oversight.

When the legality of rules is questionable and challenges have a good chance of prevailing, judges should halt enforcement of the rules until they’ve been reviewed by courts and determined to be legal exercises of EPA’s authority.

The Supreme Court’s MATS decision was an important, though tardy, correction to a bad regulation. Unfortunately, it will take an even firmer judicial approach to re-direct the agency from its current misguided path.

See the article here.

EPA Raked Over The Coals

Via The American Spectator: 

Consumers and businesses won big on Monday, when the Supreme Court struck down an Environmental Protection Agency regulation on coal plant emissions because the EPA failed to consider whether the costs outweighed the benefits. Not the cost to government, mind you. The cost to us, as consumers and business owners, to comply. The Court’s 5-4 decision in Michigan v. Environmental Protection Agency is a setback for the Obama administration but an important protection for the rest of us.

Federal overregulation—of everything from automobiles to fast food and power plants — makes it more expensive for employers to hire and more expensive for consumers to buy everyday products. Amazingly, 29 percent of what the average household spends is due to regulations jacking up prices. We could afford a lot more if there were fewer regulations.

Some are needed to protect our health and safety, but Washington D.C. overdoes it. And has for decades. The Obama administration is the all-time worst offender, and its EPA imposes the most regulatory burden of any agency.

Monday’s court ruling is a red flag to regulators to measure the costs and benefits to society before deciding to pile on another regulation. But the Court cannot be counted on to protect us from overregulation, especially considering the slim victory on Monday. Every presidential candidate should be asked for a plan to tame the regulatory beast and get government off our backs.

The lawsuit against the EPA was brought by the coal industry and 21 states reliant on coal plants. Though the regulation, limiting emissions of mercury and other metals, only went into effect this April, dozens of coal plants already had closed to avoid the cost of complying, estimated at a whopping $10 billion nationwide. The high court’s ruling will not undo those plant closings. They are casualties in Obama’s war on coal.

Congress opposes the President’s crusade against coal, so the EPA found a provision in a law already on the books — the Clean Air Act of 1970 — to justify regulating metallic emissions from coal plants where “appropriate and necessary.” Scalia raged that it’s not “ even rational, never mind ‘appropriate,’ to impose billions of dollars in economic costs in return for a few dollars in health and environmental benefits.”

Requiring cost-benefit analysis originated with Ronald Reagan in 1981, but it’s only part of the remedy. Regulators will play fast and loose with the numbers to justify their regulations.

The problem, explained Justice Clarence Thomas in his concurring opinion, is that Congress gives agencies too much leeway to decide when to regulate. It’s inevitable they’ll overdo it — regulation is their business. The undemocratic result is regulation without representation.

The Obama administration is regulation on steroids. Regulations imposing more than $100 million in yearly compliance costs are up 41 percent over what the George W. Bush administration imposed, though the Bush administration also over-regulated.

These proliferating Obama regulations take money out of your pocket, adding $44 to the cost of a dishwasher, $83 to the price of a refrigerator, and $1,357 to a new car (which will soar to $3,157 in 2017) according to economists at the American Action Forum.

And there’s the cost to our democracy. Obama’s EPA is also rolling out another scheme — the Clean Power Plan — against the will of Congress. It will force states to close coal plants and change the energy mix in their state. Harvard constitutional lawyer Lawrence Tribe is urging his old student, Barack Obama, to obey the law. “Frustration with congressional inaction cannot justify throwing the Constitution overboard.”

Twelve states are now suing the EPA to halt this scheme as well. Obama’s EPA lost in the Supreme Court on Monday. But the president, ruling with a pen and phone and without Congress, bullies on.

See the article here.