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EPW POLICY BEAT: BOILING POINT
September 8, 2010

Posted by Matt Dempsey matt_dempsey@epw.senate.gov

EPW POLICY BEAT: BOILING POINT

As President Obama tries to sell his latest incarnation of economic stimulus, his own Environment Protection Agency is busily promulgating regulations that are stifling growth and threatening jobs. In the coming weeks, we will focus on the full panoply of EPA's job-crushing regulations.  Today, we will focus on one such proposal: maximum achievable control technology standards for industrial boilers, or the so-called Boiler MACT.   

We understand that readers will avert their eyes or drift into somnolence at the very sound of "Boiler MACT" - but stick with us.  While this and other EPA regulations don't grab headlines, their reach and impact are no less pervasive and damaging as other more widely known Obama Administration policies. 

The Boiler MACT has a long and tortured legal history, the details of which we won't bore you with here.  In essence, the rule seeks to reduce certain toxic air pollutants from industrial boilers, process heaters, and solid waste incinerators used by array of industries, including, among many others, refiners, cement, pulp and paper, steel, food processing, and chemicals. We support reducing such pollutants from these sources, but EPA's rule goes far beyond what is needed to protect public health. 

In short, the rule mandates emissions standards that, for many, cannot be met. The Small Business Administration's Office of Advocacy held two roundtables to discuss the rule's requirements.  As Winslow Sargeant, the office's Chief Counsel noted, "There was widespread agreement among the participants representing a large diversity of manufacturing sectors that this proposal has impractical emissions limits that will be exceedingly costly to meet for almost all facilities."

A deeper look through the public record demonstrates quite starkly how negatively employers, large and small, view this rule.  And not just employers: consider comments by the United Steel Workers (USW) union, which believes the Boiler MACT:   

...will be sufficient to imperil the operating status of many industrial plants.  Hundreds of thousands of workers in the most heavily-impacted industries, among them pulp & paper, steel, and rubber, are represented by USW. Tens of thousands of these jobs will be imperiled. In addition, many more tens of thousands of jobs in the supply chains and in the communities where these plants are located also will be at risk.

The Industrial Energy Consumers of America (IECA), which represents major manufacturers with over 750,000 employees, couldn't have been more adamant: "We cannot emphasize more forcefully the need to the EPA to completely rethink this rule."  That's because IECA's member companies "are enormously concerned that the high costs of this proposed rule will leave companies no recourse but to shut down the entire facility, not just the boiler." [Emphasis added]

The rule, IECA wrote, "threatens countless companies to spend millions of dollars per boiler and many companies have multiple boilers - all without any financial benefit and at a time they can least afford it."   This means that "when companies are forced to spend capital on projects that do not create value, there is less capital available to hire workers, invest in energy efficiency, R&D etc."

Comments were filed by companies and trade associations from every region of the country.  Take the Pennsylvania Forest Products Association, which summed up the rule this way:

At a time when all government agencies should be focused on job creation and economic recovery, EPA's currently proposed regulation will have the opposite effect, further depressing business conditions, resulting in more business closings and job losses.

Then there's Thilmany Papers, a company that employs 850 people in two specialty paper mills in Wisconsin.  "Our business, like many others," according to the company's public comments "encounters many challenges.  However, none threaten the continued existence of our business like the proposed Boiler MACT and CISWI rules." [Emphasis added]

Or take the Association of Washington Business, Washington State's chamber of commerce, representing over 7,000 businesses:

The proposed standards are far more stringent than required to protect air quality and will impose unnecessary and burdensome costs on employers, at a time when our economy is struggling to recover. And because companies located outside of the United States will not have to comply with the proposed regulations, US companies will be at an even greater competitive disadvantage than they already are.

President Obama spoke in Milwaukee on Labor Day, lamenting the fact that the "decks are all too often stacked in favor of special interests and against the interests of working Americans."  Because of Obama's EPA, that's all too true.  President Obama also said "we built this country by making things, by producing goods we could sell."   Again, true, but because of Obama's EPA, America's great manufacturing predominance is eroding before our eyes.

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