U.S. EPA's plan to crack down on toxic air pollution is too strict and will lead to a spike in electricity prices, top executives from two major power companies testified on Capitol Hill today as they asked lawmakers to have the agency rework its rules.
Thomas Fanning, the head of the coal-heavy utility Southern Co., said his company would need to spend up to $4.1 billion over the next three years to comply with new EPA rules -- costs that would translate into a 25 percent rise in electricity prices for its customers in the Southeast.
Similar rate increases were predicted by Anthony Earley, executive chairman of Detroit-based DTE Energy Co., who said the utility would need to retire coal-fired plants with between 20 and 30 percent of its power-generating capacity over the next four years.
The executives were speaking at a House Energy and Commerce subcommittee hearing on EPA's new toxic pollution rules for power plants, industrial boilers and cement kilns. By setting limits on the amount of acid gases, mercury and toxic metals that each individual plant is allowed to release into the air, the regulations would save tens of thousands of lives per year, the agency says (Greenwire, March 16).
Fanning and Earley both urged Congress to overhaul the rules, or at least, give industry more time to comply. EPA plans to finish its rules for the power sector by November, but it's "unrealistic" to expect companies to upgrade all their power plants by 2015 as the Clean Air Act would require, Fanning said.
"As the CEO of a company that has installed more pollution controls than any other utility, I tell you that this cannot be done in three years," he said.
According to EPA estimates, about 10 gigawatts' worth of coal-fired power plants would shut down because of the rules, and electricity prices would increase by an average of 3.7 percent. Though the agency predicts that the rules for power plants, boilers and cement kilns would cost about $14 billion per year, it estimates that the health benefits would be worth more than 10 times as much.
EPA didn't send an official to speak at today's hearing, leading to finger-pointing from both sides of the aisle.
Democrats said the committee's Republican leadership hadn't given the agency enough warning about today's hearing, so top officials were already booked to speak elsewhere by the time it was announced. But Republicans said the absence of an EPA witness was a slight to the committee, with former Energy and Commerce Chairman Joe Barton (R-Texas) quipping that the agency's name should be the "Evaporating Personnel Administration."
Republicans are hoping to have an EPA official on hand for another hearing on the topic next month as they discuss legislative proposals to delay or tweak the rules. The release date for a bill on that topic "has not been set in stone," Robert Sumner, a spokesman for Energy and Power Subcommittee Chairman Ed Whitfield (R-Ky.), said in an email.
Energy and Commerce Chairman Fred Upton (R-Mich.) said today that he wants the toxics rules to be crafted so they cut pollution without slamming manufacturers, hurting employment and causing other "undue hardships."
"The goal is not to repeal these regulations," he said. "It is to advance them in a reasonable way."
That goal was assailed by Democrats, who say Congress ordered the toxic pollution rules to be in place a decade ago. Rep. Henry Waxman of California, the top Democrat on the Energy and Commerce Committee, described today's hearing as "one of a series of assaults on the Clean Air Act."
Since the Republicans took control of the House last fall, environmentalists and their allies on Capitol Hill have used similar language to fight back against Republican efforts to stop EPA's new climate change rules. Upton and his fellow Republicans vigorously denied that they were rolling back the Clean Air Act when a bill to overturn the greenhouse gas regulations was debated in March, insisting that the legislation wouldn't stop EPA from enforcing laws that deal with soot, smog and toxic pollution.
"Well, that was last month," Waxman said today. "This month, they're directly targeting EPA's ability to protect the public from these very pollutants. And let's be clear, delaying these rules will hurt a large number of people, especially children."