Good afternoon. My name is Brad Campbell. I am Commissioner of the New Jersey Department of Environmental Protection. I speak today for the eight Northeast states that make up the Northeast States for Coordinated Air Use Management (NESCAUM). I understand that many of the views I will offer are also shared by the states of the larger Ozone Transport Commission. I appreciate the opportunity to testify before the Committee today to present a Northeast states' perspective on the critically important issue of federal action to reduce power plant pollution.

I want to begin by emphasizing that the Northeast States strongly support efforts to enact multi-pollutant legislation, and have so testified before this Committee in the past. We applaud the Administration and this Committee for making passage of such legislation a priority for the 108th Congress. It has been over a decade since the last Clean Air Act Amendments, and the time has clearly come for a new national policy to address the broad array of public health risks and environmental harms caused by power plant emissions.

In the Northeast, where sulfur dioxide and nitrogen oxides emissions from upwind power plants contribute significantly to problems ranging from fine particle and ozone pollution to acid rain, eutrophication of surface waters, and poor visibility in our parks and wilderness areas, we have long appreciated the need for concerted federal action. With mercury contamination necessitating fish consumption advisories for most of our lakes and rivers, we see an urgent need for new measures to curb the continued buildup of this persistent, potent neurotoxin in our environment. And we see the problem of climate change as presenting unprecedented challenges for our ecosystems and quality of life, but also great economic opportunity for those who develop and provide the clean energy technologies of the future.

For all of these reasons, the Northeast States have followed with keen interest the development of several multi-pollutant initiatives now before Congress, including the Administration's "Clear Skies" proposal. In evaluating each initiative, we have asked three core questions:

? Is it comprehensive?

? Is it adequate to address the significant public health and environmental challenges we face?

? Does it strengthen our ability to ensure continued clean air progress, not only at the national level, but also at the local, state and regional levels?

Recognizing Clear Skies as a starting point for the Committee's deliberations, I want to focus my remarks today on where and how we believe Clear Skies needs to be improved to meet these tests.

First, emissions reductions can and must happen sooner. As you know, many areas of the country need to attain new, more stringent health-based federal standards for ozone and fine particles in the next 4-7 years. Yet the emissions caps in Clear Skies won't be fully implemented until 2018. Delaying necessary cuts for another 15 years is problematic for states trying to reach attainment, but it's even more problematic for the tens of thousands of people who experience serious health effects associated with unnecessarily high levels of fine particle and ozone pollution.

Second, we can and must do more to reduce mercury emissions. Given the persistent, bioaccumulative threat posed by this neurotoxin and the availability of highly effective control technologies, power plant mercury emissions should be capped at levels at least 50% lower than the 15 ton figure proposed in Clear Skies.

Third, national multi-pollutant legislation must address the intractable problem of interstate pollution transport in a concrete and effective manner, and must not weaken or remove crucial regulatory tools that States rely on to improve air quality at the local, state, and regional levels.

Clear Skies offers no guarantee that long-standing regional transport concerns will be solved under a new national emissions trading program, yet states would be prohibited from petitioning for federal action to address transport until after 2012. Even then, the new hurdles Clear Skies establishes for federal intervention would make the current transport provisions of the Clean Air Act practically unenforceable.

States support constructive reform of the Clean Air Act, provided it genuinely advances our clean air objectives and is strictly tied to the actual implementation of new reduction requirements. Clear Skies appears to go too far in the name of regulatory reform, however, proposing to substantially weaken or even eliminate several provisions of the current Clean Air Act. A list of several such concerns - including New Source Review, regulation of non-mercury toxins, potential local impacts, and protection of states' rights - is attached to my written testimony. The bottom line is that when it comes to protecting public health, it is far better to have too many tools and not need some than to have too few tools and come up short regarding our citizens' quality of life.

The final issue I want to address is carbon dioxide. We believe it belongs in multi-pollutant legislation because without it, the market signals and business certainty needed to promote sound long-term resource choices and investment decisions by the electric power industry will remain absent. The inevitable long-term result is greater climate risk - and higher costs - for both industry and consumers. The Northeast States feel so strongly about the need to act on climate change that many have made state-level commitments to reduce greenhouse gas emissions and/or have included carbon in their own, more aggressive 4-pollutant initiatives. The several such efforts already in effect show that the Northeast states are willing to lead by example, but as downwind states, we can't do it all by ourselves.

In short, we support multi-pollutant legislation that cost-effectively does both more and less than Clear Skies proposes. More - and sooner - in terms of pollution reductions; less in terms of changing the Clean Air Act.

This is precisely how the "Straw Proposal" that EPA originally drafted as the Administration's multi-pollutant initiative could be described. The Straw Proposal called for emissions reductions closer to 85% (compared to Clear Skies' 70%) and, importantly, for reductions to be fully implemented by 2010-12. Moreover, EPA's own analysis showed that the health benefits of this substantially more aggressive approach far outweighed its costs. EPA's analysis showed that implementing the Straw Proposal would cost $3.5 billion more than Clear Skies in 2020, but it would produce $59 billion in additional health benefits. We urge the Committee to re-visit EPA's Straw Proposal and other current legislative alternatives that go further toward capturing these benefits.

In closing, let me thank you for considering our views and again commend the Administration for pushing forward on multi-pollutant legislation. The issues are complex, and the debate will no doubt be intense. But the Northeast states look forward to playing a constructive role, and we hope all sides can agree that the opportunity and need for real progress on these issues is as great as the public health, environmental and energy challenges we face are daunting.

Technical Concerns of the Northeast States Regarding S.485, the Clear Skies Act of 2003

• Clear Skies diminishes or repeals entirely some of States' most important tools for achieving federal, health-based air quality standards:

• New Source Review (NSR)

• The utility Maximum Achievable Control Technology (MACT) rule as it applies to hazardous air pollutants (HAPs) other than mercury

• Residual risk requirements for mercury

• Lowest Achievable Emission Rate (LAER) and offset requirements and conformity for most areas of the country

• Use of Section 126 until 2012, and only then under a higher burden of proof

• Some Prevention of Significant Deterioration (PSD) requirements

• Protection of visibility in Class I airsheds.

• Clear Skies appears to undermine, if not preempt entirely, state and local authority to adopt and to take State Implementation Plan (SIP) credit for more stringent requirements for power plants.

• Clear Skies provides no protections against adverse local health and environmental impacts that could arise, and does not require even a minimum level of control at each power plant.

• Regulatory relief under Clear Skies is provided expeditiously, but corresponding emission reduction requirements are delayed for years - a serious unbalancing of these dual policy objectives.

• Clear Skies' approach to allocating allowances appears to continue the practice of rewarding past high emitters, rather than encouraging economic efficiency through output-based allocation approaches and/or approaches that reward combined heat and power (CHP) applications.