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EPA issues carbon emissions rule

By Larry Dreiling

The Environmental Protection Agency on June 3 released a draft rule to regulate carbon emissions from hundreds of fossil-fired power plants across the United States.

The proposed rule mandates that power plants cut U.S. carbon-dioxide emissions 30 percent by 2030 from levels seen in 2005.

“That’s like canceling out annual carbon pollution from two-thirds of all cars and trucks in America,” EPA Administrator Gina McCarthy said in speech at EPA headquarters announcing the rule. “And if you add up what we’ll avoid between now and 2030, it’s more than double the carbon pollution from every power plant in America in 2012.”

The carbon framework EPA has drafted seeks what it says will be striking a balance between what environmentalists want—an ambitious overall target—with what the utility industry wants: flexibility, along with a long compliance timeline and an earlier base-year calculation from which to meet the goal.

Carbon emissions have dropped since 2005, making the overall reduction smaller than it would have been if the EPA had used a more-recent year for a baseline. Burning coal is the cheapest and most abundant source—40 percent—of the nation’s electricity, but produces more carbon dioxide than oil and natural gas. The utility sector accounts for about one-third of U.S. total carbon emissions, according to EPA.

On a conference call with the American Lung Association following McCarthy’s announcement, President Barack Obama touted the rule’s estimated public health benefits and pushed back against critics’ claim it would hurt the economy. He added it would actually help electricity users.

“It provides a huge incentive for states and consumers to become more energy efficient,” Obama said. “As a result, your electricity bills will shrink as these standards will spur investment in energy efficiency and cutting waste.”

The plan seeks to reduce 2005 emissions nationwide by an average of 25 percent by 2020 and 30 percent by 2030. However, the EPA is giving each state a goal based on the agency believes is achievable for that state, which takes into account progress individual states have made since 2005.

For example, Kansas must reduce its carbon by 23 percent—based on pounds of carbon dioxide emitted per megawatt hour of electricity produced—over the next 15 years. That’s a relatively average percentage cut compared with other states that have fossil fuel intense economies, such as Arkansas, which must cut its emissions by 45 percent by 2030, or less intensive economies, such as Iowa, at 12 percent over the next 15 years.

Other states in the region and the amount of carbon pollution needed to be reduced are: Colorado, 35 percent; Missouri, 13 percent; Nebraska, 23 percent; New Mexico, 34 percent; Oklahoma, 35 percent; South Dakota, 35 percent; and Texas, 39 percent.

The nation’s two largest farm groups offered widely differing viewpoints on the plan. The American Farm Bureau Federation said EPA’s proposal will harm the nation’s economy, rural communities and America’s farm and ranch families, if implemented.

“The EPA’s attempt to impose a 30 percent reduction in carbon dioxide on the nation’s power plants will lead to higher energy prices,” the AFBF statement said. “Farmers would face not just higher prices for electricity, but any energy-related input such as fertilizer. Rural electric cooperatives that rely on old coal plants for cheap electricity would be especially hard hit.”

AFBF President Bob Stallman said: “U.S. agriculture will pay more for energy and fertilizer under this plan, but the harm won’t stop there. Effects will especially hit home in rural America.”

“The greenhouse gas proposal is yet another expensive and expansive overreach by EPA into the daily lives of America’s farmers and ranchers,” Stallman said. “Our farmers and ranchers need a climate that fosters innovation, not unilateral regulations that cap our future.”

National Farmers Union President Roger Johnson said: “The changing climate has already begun to affect agriculture, and it is clear that weather volatility will only continue to increase in the coming years unless our policymakers proactively address this challenge. I commend the administration for its leadership on climate change mitigation.

“Agriculture stands ready to be an important part of the solution to our climate challenges. I encourage Congress and the administration to engage the agricultural community in reducing carbon pollution by creating voluntary incentives for sequestering carbon and implementing conservation strategies that preserve our limited soil and water resources.”

Johnson also said the Renewable Fuel Standard is currently the most important policy the U.S. has to address climate change.

“I hope EPA reinforces today’s announcement by withdrawing its misguided proposal to undermine the RFS, returning the 2014 biofuels target to its statutory levels,” Johnson said.

“I also urge EPA to recognize that rural electric cooperatives serve our nation’s farmers and ranchers and are a significant source of rural employment. Co-ops provide power to 42 million Americans and account for 12 percent of total U.S. electricity sales. Any regulatory action must consider the impact on rural electrics and the communities they serve.”

Relying on the four-decades-old Clean Air Act, the EPA is giving customized targets to each state, then leaving it up to those states to develop plans to meet their targets. Some states will be allowed to emit more and others less, leading to an overall, nationwide reduction of 30 percent.

Although Obama initially wanted each state to submit its plan by June 2016, the draft proposal shows states could get extensions until 2017. If they join with other states, as New York has done, they could have until 2018, kicking full implementation of the rules well into the next president’s administration.

That raises the possibility that shifting political dynamics in Washington could alter the rule’s course. Although Obama could veto action by Congress to block the rule, he can’t ensure that his successor will do the same. Scuttling the rules would also be easier if Republicans take the Senate in November.

A few Democrats joined a chorus of Republicans in vowing to obstruct the rules legislatively, Sen. Mary Landrieu, D-LA, chairman of the Senate Energy and Natural Resources Committee, issued a cautious statement, but she still opposed the overall effort.

“While it is important to reduce carbon in the atmosphere, this should not be achieved by EPA regulations,” said Landrieu, who is in a tight re-election race against Rep. Bill Cassidy, R.-LA. “Congress should set the terms, goals and timeframe.

“Greater use of natural gas and stronger efficiency measures adopted by the industry have already helped us reduce carbon emissions to their lowest levels in 20 years, and this should continue. I will work with leaders of both parties to build on the progress we have already made.”

Rep. Nick Rahall, a vulnerable West Virginia Democrat, said he would not only back legislation but also join lawsuits. Republican House of Representatives Speaker John Boehner simply called Obama’s plan “nuts.”

All regional Republican lawmakers decried the move, for example, Sen. Jerry Moran, R-KS.

“The proposed EPA rule, crafted without the input of Congress, amounts to a national energy tax that will threaten economic growth, destroy jobs, and lead to higher energy costs for Kansas families and businesses. Kansas would be especially hurt because more than 60 percent of our state’s electricity production comes from coal,” Moran said.

“At a time when our country is making progress in regaining manufacturing jobs from abroad, these regulations will again send jobs out of the United States. Washington should focus on common-sense policies to make energy cleaner and more affordable rather than more red tape and harmful regulations. This Administration continues to ignore the impact a rule like this has on average Americans.”

EPA is also taking comment on at least one other, less stringent option. Under that plan, the national average reduction in carbon emissions would be up to 24 percent in 2025, based on the same base year of 2005. Between now and June of next year, EPA will take comment on what plan it should finalize, including potentially other more ambitious proposals not included in this draft.

Another potential hitch: governors who refuse to cooperate. If a state declines to develop a plan, the EPA can create one itself. But how EPA could force a state to comply with that plan remains murky.

“A recent study conducted by the Kansas Corporation Commission has shown that Kansas homeowners, schools, and businesses are already paying an extra $227 million a year to pay for President Obama’s overregulation of energy producers, an increase of 9.4 percent since 2007,” said Gov. Sam Brownback, R-KS. Brownback was typical of Republican governors when he issued the statement that “news that the EPA will be imposing even more expensive regulations on Kansas utilities, and doing so without approval from Congress, is very troubling as it further disrupts the balance that must be achieved between protecting the environment and growing the economy.

“Furthermore, these regulations will continue to raise the cost of living for every Kansan, making the burden on those who are already struggling to pay their bills each month unnecessarily more difficult. Kansas has been working hard to do its part to protect the environment by supporting clean coal technologies at the new plant in Holcomb, as well as diversifying our energy portfolio with wind and natural gas.”

The administration said the nearly $9 billion price tag will be offset numerous times over by health savings from reductions in other pollutants like soot and smog that will accompany a shift away from dirtier fuels.

To meet their targets, states could make power plants more efficient, reduce the frequency at which coal-fired power plants supply power to the grid, and invest in more renewable, low-carbon energy sources.

The Associated Press contributed to this report.

Larry Dreiling can be reached by phone at 785-628-1117 or by email at

Date: 6/16/2014


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