Vitter Summary Statement for Lake Charles Field Briefing on EPA's Upcoming Ozone Standards
U.S. Senate Committee on Environment & Public Works EPW Republican Field Briefing “Louisiana Jobs and Economic Growth in Jeopardy: How EPA’s Upcoming Ozone Standards Will Harm Project Development”
August 22, 2014
Thank you everyone for being here today to discuss a topic critical to the economic opportunity and the future of Louisiana. Today's witnesses are here to speak on the challenges facing Louisiana and Lake Charles from EPA's Clean Air Science Advisory Committee (CASAC) recommended compliance range on ozone. We are fortunate today to have an especially credible panel who can speak competently on the job loss, opportunity loss, and other challenges a new standard will present. Let me thank Larry DeRoussel from the Lake Area Industry Alliance, Mike Walls from the American Chemistry Council, and Grant Bush from the Imperial Calcasieu Regional Planning and Development Commission for coming out this morning. Also, thank you to my colleagues, Congressmen Bill Cassidy and Charles Boustany, for being here today.
As most of us know, EPA is currently in the process of reviewing the ozone National Ambient Air Quality Standard, which was last set at 75 parts per billion in 2008. EPA is required under a court ordered deadline to propose the revised standard in December, likely reducing the current standard to a range within 70 to 60 parts per billion. Setting the standard at 60 changes the map considerably, placing almost the entire country in violation, including pristine national parks like Yellowstone and the Grand Canyon. This range, especially the lower end, presents a variety of problems for Louisiana.
Lowering the standard would put practically the entire state of Louisiana in violation. The Lake Charles area has attained the ozone standard for many years, making it a very attractive place for companies to expand and locate to. But this will change if EPA lowers the ozone standard. Being out of attainment could keep companies from locating in Louisiana and could even result in some industries electing to shut down their facilities and move out of state or even out of the country to places where there are fewer compliance restrictions. Since the main economic driver of the state and the largest industry presence is manufacturing, our local manufacturing renaissance will likely grind to a halt.
According to LSU's Louisiana Economic Outlook for 2014 and 2015, the Lake Charles area is about to enter the finest growth period in its history, with 7,800 new direct jobs projected over 2014-2015. The Greater Baton Rouge Regional Industrial Managers Association has documented a monumental $46.6 billion in announced industrial expansions in this region. The Lake Area Industrial Alliance projects construction labor demand to jump from about 6,000 now to 14,000 in 2016. These numbers represent huge successes for this area, but also significant challenges for maintaining attainment - particularly under a lower ozone standard.
Last month, the National Association of Manufacturers released a study on the costs and economic impacts of a 60 parts per billion ozone standard, finding that it would be the single most expensive regulation in history. It would reduce GDP by $270 billion each year and as much as $3.4 trillion by 2040. The average U.S. household would lose $1,570 per year, while job impacts in the form of fewer hours worked, lower pay, and lost jobs averaged 2.9 million per year. The study also examined the potential impact of new oil and gas production being significantly restricted in areas of the country designated nonattainment, potentially driving up energy costs for families and manufacturers by 15 and 23 percent, respectively. Louisiana would suffer from potentially 116,000 lost jobs per year, $53 billion in gross state product loss from 2017 to 2040, a $2,360 drop in average household consumption per year, and the shuttering of 80% of Louisiana's coal fired power plant capacity.
All of this economic destruction will result from EPA reducing the standard - even though the current standard of 75 parts per billion hasn't even been fully implemented across the nation, so the full measure of its benefit has yet to be experienced. But for some reason, EPA is insisting on jumping the gun and leading us down a path of destruction, stunting growth at the Port of Lake Charles and punishing the state by driving away businesses and essentially halting all economic development in the area.
With that being said, I turn to my colleagues in Congress. Thank you.