Obama's EPA Waging War on Fossil Fuels

Sen. Inhofe: Obama's EPA Waging War on Fossil Fuels
by John Rossomando
10/03/2011

Job creation has been all over President Obama’s lips in the past few weeks, but GOP opponents say his Environmental Protection Agency’s regulatory war on fossil fuels is costing the economy far more than the estimated $447 billion price tag of his jobs proposal.

“The President of the United States wants to destroy American energy,” said Oklahoma GOP Sen. James Inhofe, the ranking member of the Senate Energy and Public Works Committee. “His intention is to kill fossil fuels, which we rely on for 99% of the energy in America.

“All of this killing of our energy supply is not by accident. It’s on purpose.”

According to Inhofe, the administration’s proposed CO2/greenhouse gas-emission regulations—due out in November—could chop $300 billion to $400 billion alone off the nation’s gross domestic product (GDP) each year. Estimates from the Senate Energy and Public Works Committee's Republican staff estimates this regulation could cost in excess of the 2 million jobs that would have been lost as a result of Waxman-Markey Climate Change Bill.

Other estimates suggest that the EPA’s Utility MACT and Transport Rule could cost $184 billion and 1.4 million jobs. Statistics Inhofe provided suggest the rule could shutter hundreds of coal-fired power plants around the country—equaling as much as 20% of the nation’s total energy output.

The Utility MACT rule would increase the technology requirements imposed on utility companies for removing pollutants such as mercury from the emissions from their coal-fired power plants. It could necessitate the retrofitting of as many as 600 scrubber units across the country, according to industry estimates.

“We are relying on coal for as much as 45% of our nation’s energy,” Inhofe said. “He’s intentionally passed a rule that will shut down coal in America, and there are lots of jobs that either directly or indirectly rely on coal. It’s going to make it a lot much more expensive.”

These increased costs are underscored by a Bernstein Research report that found: “We expect the loss of this generation to translate into higher wholesale energy and capacity prices. … We estimate that this will raise the price of electricity during on-peak hours by $3 to $5 per MWh.”

The rule’s impact hit closer to home for 120 workers at a Cincinnati-area coal-fired power plant when Duke Energy announced it would be closing the plant if the rule is approved in November.

“The anticipated retirement date is contingent on potential changes to the implementation [of the] EPA’s MACT rule and other environmental regulations,” Duke Energy said in a statement released in July.

And Texas-based Luminant followed suit last week, announcing it would be laying off 500 workers in anticipation of the implementation of the EPA’s cross-state air pollution rule, set to take effect on Jan. 1, 2012.

This rule would require 23 states to reduce sulfur dioxide and nitrous oxide emissions from their power plants to reduce their effects on neighboring states.

The National Associations of Manufacturers estimates the Utility MACT and cross-state air pollution rules will cost its members $18 billion annually, and drive its members’ electricity costs up by 11.5%. It also shares Inhofe’s analysis that these regulations could cost 1.4 million jobs annually.

“There’s no question here that the EPA is overstepping their bounds,” said House Natural Resources Committee Chairman Doc Hastings (R.-Wash.) “The President says he wants us to utilize American resources, but his actions are 180 degrees from what he has said, and that seems to be pretty consistent when you are talking about energy.”

Hastings called on the Obama administration to start taking the effect of EPA regulations on jobs into consideration when it issues regulations.

Inhofe agrees. “We have a political problem here because the politicians won’t let us use our own resources.” But reports in National Journal suggest the Obama administration could be considering a retreat on the Utility MACT rule even as congressional Republicans continue hearings examining the economic impact of these EPA regulations until after the 2012 election.

“The only decision metric that matters for the next 14 months is, ‘Will this help us get reelected?’ ” an insider told National Journal. “If a regulatory decision is a liability, we should fully expect the administration to delay until Nov. 7 of 2012—the day after the presidential election.”

Inhofe and others suggest the administration will delay implementing other controversial rules, such as the possible regulation of fracking—a procedure used to extract natural gas. Environmentalists have been lobbying the administration to crack down on fracking, claiming it harms drinking water.

Fracking, he says, has created more than 1.5 million jobs over the past 60 years without a single documented case of groundwater contamination.

But the claim is disputed by a May 2011 Duke University study that found methane levels were 17 times higher than normal in areas around fracking wells.

Other regulations that could wait until 2013 include those governing the use of coal ash, the residue of coal combustion, which could have a negative impact on the economy of coal-producing states such as Pennsylvania, Ohio, West Virginia and Missouri.

Coal ash regulations would touch countless industries, such as concrete, road construction, plastics and petrochemicals, among others. The Partnership for Affordable Clean Energy estimated in a June 2011 study that the EPA’s coal ash regulations could cost 316,000 jobs and cost the economy around $110 billion.