WSJ Sees Limits On Toxic Air Pollution As A “War On Jobs”

WSJ Attacks Proposed Air Toxics Regulation As A “War On Jobs.” From the Wall Street Journal editorial titled, “The EPA's War on Jobs: Coal is from Earth, Lisa Jackson is from mercury”:

President Obama's jobs council will make its first recommendations today on lifting hiring and strengthening the economy. Too bad the message doesn't seem to be reaching the Administration's regulators, in particular the Environmental Protection Agency.

The EPA is currently conducting a campaign against coal-fired power and one of its most destructive weapons is a pending regulation to limit mercury and other hazardous air pollutants like dioxins or acid gases that power plants emit. The 946-page rule mandates that utilities install “maximum achievable control technology” under the Clean Air Act--and even by the EPA's lowball estimates, it is the most expensive rule in the agency's history.

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The power industry estimates that the true costs of the utility rule will far exceed the EPA estimates, which of course will be passed to consumers and businesses as higher prices. The International Brotherhood of Electrical Workers, normally a White House union ally, says the rule will destroy 50,000 jobs and another 200,000 down the supply chain. That's more jobs lost than if Boeing went bust. [The Wall Street Journal, 6/13/11]

Studies Find EPA Rules Will Result In Net Creation Of Jobs

UMass Study: EPA Rules Would Result In Net Creation Of Jobs. The study projected that between 2010 and 2015, the power sector would invest almost $200 billion on capital investments in pollution controls and new generation capacity to comply with the new Clean Air Act rules, which would generate an estimated 1.46 million job-years, which are defined as one year of full-time employment. The study further found that job reductions from projected coal plant closures will be “more than” offset by the number of new jobs created. [University of Massachusetts Political Economy Research Institute, February 2011]

EPI: “The Jobs-Impact Of The Rule Will Be Modest, But It Will Be Positive.” In a June 14 study, the Economic Policy Institute concluded that the job impact of the utility air toxics rule “will be modest, but it will be positive.” The study specifically found that the rule “would have a modest positive net impact on overall employment, likely leading to the creation of 28,000 to 158,000 jobs between now and 2015.” [Economic Policy Institute, 6/14/11]

CRS: 56% Of Coal And Oil Power Plants Are Already Meeting The Standards. From a Congressional Research Service Report on EPA regulations initiated since January 2009:

In 2005, EPA promulgated regulations establishing a cap-and-trade system to limit emissions of mercury from coal-fired power plants. The rules were challenged, and the D.C. Circuit Court of Appeals vacated them in 2008. Rather than appeal the ruling to the Supreme Court, EPA agreed to propose Maximum Achievable Control Technology (MACT) standards by March 2011 and promulgate final standards by November 2011. The proposed standards, released March 16, are already being met by 56% of coal- and oil-fired electric generating units; the other 44% would be required to install technology that will reduce mercury and acid gas emissions by 91%, at an annual cost of $10.9 billion. EPA estimates that the annual benefits, including the avoidance of up to 17,000 premature deaths annually, will be between $59 billion and $140 billion. Following promulgation of these standards, existing power plants will have three years, with a possible one-year extension, to meet the standards. About 20 states have already established mercury emission control standards for coal-fired power plants, and other major sources have been controlled for as long as 15 years, reducing their emissions as much as 95%. [Congressional Research Service, 3/21/11]

NY Times: “About A Third Of States” Have Already Set Mercury Standards. From a March 16 New York Times article:

Roughly half of the nation's more than 400 coal-burning plants have some form of control technology installed, and about a third of states have set their own standards for mercury emissions. But the proposed rule issued Wednesday is the first national standard and will require all plants to come up to the standard of the cleanest of current plants. [New York Times, 3/16/11]

Power Company Execs: “For Over A Decade, Companies Have Recognized That The Industry Would Need To Install Controls.” Responding to a previous Wall Street Editorial, executives representing several major power companies stated:

Your editorial "The EPA Permitorium" (Nov. 22) mischaracterizes the EPA's air-quality regulations. These are required under the Clean Air Act, which a bipartisan Congress and a Republican president amended in 1990, and many are in response to court orders requiring the EPA to fix regulations that courts ruled invalid.

The electric sector has known that these rules were coming. Many companies, including ours, have already invested in modern air-pollution control technologies and cleaner and more efficient power plants. For over a decade, companies have recognized that the industry would need to install controls to comply with the act's air toxicity requirements, and the technology exists to cost effectively control such emissions, including mercury and acid gases. The EPA is now under a court deadline to finalize that rule before the end of 2011 because of the previous delays.

To suggest that plants are retiring because of the EPA's regulations fails to recognize that lower power prices and depressed demand are the primary retirement drivers. The units retiring are generally small, old and inefficient. These retirements are long overdue.

Contrary to the claims that the EPA's agenda will have negative economic consequences, our companies' experience complying with air quality regulations demonstrates that regulations can yield important economic benefits, including job creation, while maintaining reliability.

The time to make greater use of existing modern units and to further modernize our nation's generating fleet is now. Our companies are committed to ensuring the EPA develops and implements the regulations consistent with the act's requirements. [Wall Street Journal, 12/8/10]

WSJ Forwards Claim That Pollution Limits Will Shut Down Five AEP Plants

WSJ: “American Electric Power Recently Announced That The Rules Will Force It To Shut Down Five Plants.” From the Journal editorial:

The real goal of the EPA's rule is to shut down fossil fuel electric power in the name of climate change. The consensus estimate in the private sector is that the utility rule and eight others on the EPA docket will force the retirement of 60 out of the country's current 340 gigawatts of coal-fired capacity. Reliability downgrades will hit the South and Midwest where coal energy is concentrated. American Electric Power recently announced that the rules will force it to shut down five plants in West Virginia and Ohio, a quarter of its coal fleet. [The Wall Street Journal, 6/13/11]

Three Of The Five Coal Plants Were Already Slated To Close

AEP Spokeswoman: “These Units Are Already Slated For Retirement Anyway.” From a June 9 Charleston Gazette article:

American Electric Power said Thursday it may move up the closings of three aging coal-fired power stations in West Virginia if federal regulators finalize new rules aimed at reducing illnesses and deaths caused by plant emissions.

AEP said the U.S. Environmental Protection Agency proposal could force it to retire the Kanawha River Plant in Glasgow, the Phillip Sporn Plant in New Haven and the Kammer Plant near Moundsville by Dec. 31, 2014.

West Virginia political leaders seized on the AEP announcement to further their criticism of what they call the Obama administration's “war on coal,” with Sen. Joe Manchin, Rep. Shelley Moore Capito and acting Gov. Earl Ray Tomblin all issuing statements blasting the EPA proposal.

But AEP officials pointed out that the three West Virginia plants -- all of them more than 50 years old -- were already slated to be closed between 2017 and 2020.

“These units are already slated for retirement anyway, so we don't want to overstate this,” said Jeri Matheney, a spokeswoman for AEP's Appalachian Power subsidiary in Charleston.

And while about 240 jobs could be lost at the three West Virginia plants, Matheney said many of the employees in those posts could take retirement before 2014 or be transferred to other positions within AEP. Currently, 62 people work at the Kanawha River Plant, 120 at Phillip Sporn and 60 at Kammer, Matheney said. [The Charleston Gazette, 6/9/11]

EPA: “Market For Electricity In the U.S. Will Be More Level And No Longer Skewed In Favor Of The Higher Polluting Units.” From EPA's proposed air toxics rule:

A number of EGUs operating today were built in the 1950s and 1960s, using now-obsolete and inefficient technologies. Today, new units are far more efficient in their production of electricity, their use of fuel, and the relative quantities of pollution emitted. To the extent that some of the oldest, least efficient, least controlled units are retired by companies who elect not to invest in controlling them, assessments included in the docket to today's notice of proposed rulemaking indicate that there will be a sufficient supply of electricity from newer units. In fact, one consequence of today's proposed rule, if adopted as a final rule, will be that the market for electricity in the U.S. will be more level and no longer skewed in favor of the higher polluting units that were exempted from the CAA at its inception on Congress' assumption that their useful life was near an end. Thus, this proposed rule will require companies to make a decision--control HAP emissions from virtually uncontrolled sources or retire these sometimes 60 year old units and shift their emphasis to more efficient, cleaner modern methods of generation, including modern coal-fired generation. [Federal Register, 5/3/11]

WSJ: Bush Admin's Rule Was Overturned “On Technical Grounds”

In 1990, Congress gave the EPA discretion to decide if mercury regulation is “necessary and appropriate,” and the Clinton Administration did so in its final days. The Bush Administration created a modest mercury program, only to have it overturned by an appeals court on technical grounds in its final days. The case was still in litigation when Mr. Obama took office, and his appointees used the opening to strafe the power industry, proposing a much more stringent rule. [The Wall Street Journal, 6/13/11]

Court Rejected Bush Admin Rule Because It Violated The Clean Air Act

Bush Sr. And Bipartisan Congress Directed EPA To Regulate Mercury And Other Air Toxics. From a December 2010 Greenwire report:

In the first few years after the law [Clean Air Act] hit the books in 1970, U.S. EPA cracked down on airborne lead, soot and smog. Congress had also ordered EPA to figure out the risks posed by toxic contaminants, but the agency did little to stop mercury and other rare but dangerous chemicals from being released into the air.

In two decades, the agency had applied that section of the Clean Air Act to just eight substances.

Lawmakers who wrote the pollution law were fed up; so was President George H.W. Bush. After consultations with environmentalists and industry groups, they prepared a package of amendments that changed the rules for toxic air pollution. It listed mercury and nearly 200 other substances by name and told EPA to regulate them, sparing the agency the challenge of proving that the substances posed a risk.

The amendments sailed through the House, 401-25, supported by many Republicans who are now among EPA's most vocal critics. Bush signed the amendments into law the week before Thanksgiving, saying it was time to “break the logjam that hindered progress on clean air.”

“Every American expects and deserves to breathe clean air,” Bush said at a White House signing ceremony. “And as president, it is my mission to guarantee it for this generation and for the generations to come.”

Fast forward to today. Toxic pollution limits have been set for many industries, but a generation after the last major change to the nation's air pollution laws, EPA still doesn't have standards for coal-fired power plants and other facilities that release most of the nation's mercury. [Greenwire, 12/8/10]

NY Times: Bush Admin Proposed A Rule That Its Own Lawyers Acknowledged Would “Almost Certainly Be Reversed.” The New York Times reported:

The new rules bring to a close a bitter legal and regulatory battle dating back to the passage of the 1970 Clean Air Act, which first directed the E.P.A. to identify and control major industrial sources of hazardous emissions.

By 1990, however, federal regulators had still not set standards for toxic emissions from power plants, and Congress, in the face of stiff resistance from utilities and coal interests, passed legislation directing the E.P.A. to study the health effects of mercury and other emissions, and to detail the cost and effectiveness of control technologies.

In 1998, the agency finally complied, delivering a comprehensive report to Congress detailing the health impact of numerous pollutants, including mercury, which by then had been linked conclusively in multiple studies to serious cognitive harm to fetuses.

In December 2000, in the last days of the Clinton administration, the E.P.A. finally listed power plants as a source of hazardous air pollutants under the Clean Air Act.

The Bush administration E.P.A. faced its own deadlines to devise and put into effect controls for power plant pollution. But rather than issue emissions standards in line with federal law, in 2005, top agency officials instituted a controversial cap-and-trade program for mercury, despite a warning from agency lawyers that the move would throw the issue back into the courts and almost certainly be reversed.

As predicted, a coalition of states and environmentalists sued the agency, arguing that the cap-and-trade program would not limit other toxic emissions like arsenic and would allow the dirtiest power plants to pay for the right to pollute, putting nearby communities at risk. In 2008 a federal judge ruled against the E.P.A., giving the agency three years to develop standards for mercury and other pollutants. [The New York Times, 3/16/11]

Court Ruled That Bush Administration Had Violated The Clean Air Act. From the appeals court decision vacating the Bush Administration's mercury regulation program:

In December 2000, EPA concluded that it was “appropriate and necessary” to regulate mercury emissions from coal- and oil-fired power plants under section 112 and listed these EGUs [electric utlility steam generating units] as sources of HAPs [hazardous air pollutants] regulated under that section. In 2005, after reconsidering its previous determination, EPA purported to remove these EGUs from the section 112 list. Thereafter it promulgated CAMR [Clean Air Mercury Rule] under section 111. EPA's removal of these EGUs from the section 112 list violates the CAA [Clean Air Act] because section 112(c)(9) requires EPA to make specific findings before removing a source listed under section 112; EPA concedes it never made such findings.

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For HAPs that result in health effects other than cancer, as is true of mercury, Congress directed that the Administrator “may delete any source category” from the section 112(c)(1) list only after determining that “emissions from no source in the category or subcategory concerned . . . exceed a level which is adequate to protect public health with an ample margin of safety and no adverse environmental effect will result from emissions from any source.” Id. § 112(c)(9). [U.S. Court of Appeals for the D.C. Circuit, New Jersey v. EPA, 2/8/08]

EPA Settlement Set Deadline For Air Toxics Rule. As explained in EPA's proposed air toxics rule:

On December 18, 2008, several environmental and public health organizations (''Plaintiffs'') 10 filed a complaint in the DC District Court (Civ. No. 1:08-cv-02198 (RMC)) alleging that the Agency had failed to perform a nondiscretionary duty under CAA section 304(a)(2), by failing to promulgate final section 112(d) standards for HAP from coal- and oilfired EGUs by the statutorily mandated deadline, December 20, 2002, 2 years after such sources were listed under section 112(c). EPA settled that litigation. The consent decree resolving the case requires EPA to sign a notice of proposed rulemaking setting forth EPA's proposed section 112(d) emission standards for coal- and oil-fired EGUs by March 16, 2011, and a notice of final rulemaking by November 16, 2011. [Federal Register, 5/3/11]

WSJ Claims Coal-Fired Power Plants Release “Negligible Quantities Of Air Pollutants Like Mercury”

According to the EPA's own numbers, every dollar in direct benefits costs $1,847. The reason is that electric generation--yes, even demon coal--results in negligible quantities of air pollutants like mercury. And mercury is on the decline: In 2005, the entire U.S. coal fleet emitted 26% less than the EPA predicted. [The Wall Street Journal, 6/13/11]

In Fact, Coal-Fired Plants Are A Major Source Of U.S. Mercury Emissions

CRS: Coal-Fired Utilities “Account For About 40% Of Current U.S. Mercury Releases.” From a 2006 Congressional Research Service report:

People have released mercury to the environment primarily through mining and smelting of minerals, burning of fossil fuels (e.g., coal, oil, and diesel fuel), use and disposal of mercury, certain industrial processes (e.g., chlorine production and cement production), and burning of municipal and medical wastes. In some parts of the world such activities are increasing, but in the United States, annual mercury emissions are decreasing. Most of the largest and most direct sources of U.S. mercury releases to water and air have been eliminated. Among the remaining U.S. industrial sources, coal-fired electric utilities are the most important, accounting for about 40% of current U.S. mercury releases. [Congressional Research Service, 1/19/06]

EPA: “Coal-Fired Power Plants Are Responsible For 99 Percent Of Mercury Emissions ... From The Power Sector.” From the EPA's “Fact Sheet: Proposed Mercury and Air Toxics Standards”:

Power plants are the largest source of several harmful pollutants. They are responsible for 50 percent of mercury emissions, over 50 percent of acid gas emissions, and about 25 percent of toxic metal emissions in the United States.

o Coal-fired power plants are responsible for 99 percent of mercury emissions and the bulk the other pollutants from the power sector.

o EPA expects that dozens of coal-fired plants already meet at least some part of the proposed standards, however, about 44 percent of all coal-fired plants lack advanced pollution control equipment. [EPA.gov, 5/4/11]

Greenwire: “Mercury Is Extremely Potent.” From a December 2010 Greenwire report:

The sectors subjected to new rules -- coal plants, industrial boilers, cement plants, hazardous waste incinerators, gold mines and chlor-alkali plants -- together produce about 80 of the 100 tons of mercury that American facilities release into the air each year.

That doesn't sound like much, considering the United States produces 6 billion tons of carbon dioxide per year, but mercury is extremely potent. Scientists estimate that 1 pound in the environment is enough to make about 2 million pounds of fish unsafe to eat. [Greenwire, 12/8/10]

WSJ: “Reliability Downgrades Will Hit The South And Midwest”

WSJ Cites “Reliability Downgrades” Due To EPA Rule. From the Journal editorial:

The real goal of the EPA's rule is to shut down fossil fuel electric power in the name of climate change. The consensus estimate in the private sector is that the utility rule and eight others on the EPA docket will force the retirement of 60 out of the country's current 340 gigawatts of coal-fired capacity. Reliability downgrades will hit the South and Midwest where coal energy is concentrated. [The Wall Street Journal, 6/13/11]

Reports: Electric System Will Remain Reliable

Bipartisan Policy Center: “Impacts On The Reliability Of The Electric System Due To EPA Regulations Are Manageable.” A report by the Bipartisan Policy Center found that “impacts on the reliability of the electric system due to EPA regulations are manageable” through early planning, delays in requirements and consent decrees. [Bipartisan Policy Center, 6/13/11]

M.J. Bradley & Associates Report: “Electric System Reliability Will Not Be Compromised If The Industry And Regulators Proactively Manage The Transition.” From a report conducted by M.J. Bradley & Associates for the Clean Energy Group:

We conclude that, without threatening electric reliability, the industry is well-positioned to respond to EPA's proposed road map to “help millions of Americans breathe easier, live healthier,” provided that EPA, the industry and other agencies take practical steps to plan for the implementation of these regulations and adopt appropriate regulatory approaches. In particular, we conclude the following:

1. Even though some units likely will retire in lieu of complying with the new regulations, electric system reliability will not be compromised if the industry and its regulators proactively manage the transition to a cleaner, more efficient generation fleet.

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2. Industry data counter concerns that it will cost the industry too much to comply with EPA's proposed air regulations, that pollution controls cannot be installed soon enough, or that the EPA regulations will lead to the closure of otherwise economically healthy power plants.

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3. EPA, the Federal Energy Regulatory Commission (“FERC”), the Department of Energy (“DOE”) and State utility regulators, both together and separately, have an array of tools to moderate impacts on the electric industry. [M.J. Bradley & Associates, August 2010]

CRA Report: “Electric System Reliability Can Be Maintained” With Clean Air Transport Rule And Utility MACT Rule. From a 2010 report by Charles River Associates assessing EPA's Clean Air Transport Rule and the regulation of toxic air pollutants from utilities:

Implementing these regulations will require some coal generators to install pollution control equipment in order to continue operations. However, given the recent discoveries of abundant, domestic natural gas supplies, a competing fuel for electric generation, as well as reduced electricity demand, coal plant owners may elect to retire some existing plants rather than investing the capital necessary to install pollution controls. Nonetheless, we conclude that electric system reliability can be maintained while the industry complies with EPA's air regulations.

The number of projected coal plant retirements nationwide is relatively small compared to historical US net additions of generation capacity, and the electric sector has demonstrated repeatedly the ability to expand the generation fleet at a rate well in excess of projected capacity needs. Although we predict that a handful of areas will have de minimis or modest shortfalls due to predicted retirements, adequate reserve margins can be maintained by better utilizing existing supply capacity, installing new generation, and increasing load management. Additionally, existing federal statutory, state regulatory, and regional transmission organization (RTO) market safeguards can be utilized to maintain a reliable electric system. [Charles River Associates, 12/16/10]