Blogs - Blogs
February 1, 2011

Posted by David Lungren


President Obama's executive order on regulatory reform calls for an examination of existing regulations.  But what about those in the pipeline?  More specifically, what about the mass of EPA rules hovering over coal-fired power plants throughout the Midwest? What about their affect on people's jobs and livelihoods?  On this, the President says nothing. 

Such inattention will be costly-and this is not mere opinion but now conventional wisdom.  Whether it's Credit Suisse, FBR Capital Markets, the Brattle Group, the North American Electric Reliability Corporation, or ICF Consulting-all conclude that EPA's proposed and soon-to-be proposed regulations could force 30 to 75 gigawatts of coal-fired electricity to shut down, starting in 2013. 

Put another way, that's the potential elimination of more than 20 percent of America's coal fleet, along with thousands of jobs throughout the middle of the country.  And this is not counting potential EPA rules to reduce carbon emissions. 

Consider where the pain will hurt most: West Virginia ("the top coal producing state east of the Mississippi River," according to EIA), 90 percent coal-fired; Ohio, 80 percent coal-fired; Michigan, 60 percent coal-fired; Minnesota, 60 percent coal-fired; and Wisconsin, 66 percent coal-fired.  Don't forget Pennsylvania, which, according to the Energy Information Administration, is "a major coal-producing State" that "sells about one-half of its coal output to other States throughout the East Coast and Midwest." 

According to an analysis by Eugene Trisko, a consultant to Unions for Jobs and the Environment (UJAE), an umbrella group of labor unions including the United Mine Workers, 16 coal-fired plants in West Virginia, 38 in Ohio, 32 in Michigan, 24 in Indiana, 21 in Pennsylvania, and 21 in Wisconsin are "at risk" of shutting down because of EPA rules.

What of the jobs?  Trisko estimates the "potential loss of 54,000 direct jobs" from EPA's regulations. These are jobs in the Heartland.  And when these jobs go away, they won't come back. 

The driver of these job losses is EPA's soon-to-be proposed maximum achievable control technology (MACT) standard for mercury and other emissions from power plants.  This rule will require plant-by-plant emissions reduction technology.  But there's more beyond mercury MACT.  As Trisko notes, EPA also has "63 air rules in the pipeline," including potential revisions to every national ambient air quality standard (NAAQS), and the potential classification of coal combustion materials as "hazardous waste."  The total cost to meet these requirements, according to the Brattle Group, could reach $180 billion.

This barrage of EPA rules is aptly referred to as the "train wreck."  Chris Korleski, former director of Ohio EPA, spoke to this when he said EPA's proposed ozone revision is creating "chaos" for Ohio, including for citizens that "feel the financial strain and economic impact" of EPA's actions.

EPA objects to the train wreck epithet, but has done nothing to dispel a basic truth: it's moving too far, too fast. 

President Obama's executive order curiously permits agencies to, "where appropriate and permitted by law," consider "human dignity," "equity," and "fairness."  These are values that, the President concedes, are "difficult or impossible to quantify."  One wonders whether EPA will consider the "human dignity" of the boiler engineer, the electrical technician, the maintenance supervisor, the operations manager, and many others who will lose their jobs and their livelihoods.  One wonders, too, about the "equity" and "fairness" of a regulatory agenda directed squarely at the middle of the country.


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