Do states and local air agencies have enough flexibility to implement tighter air standards than what the federal government requires? During today's OnPoint, William Becker, executive director of the National Association of Clean Air Agencies, discusses the results of a new survey by his organization on state flexibility on Clean Air Act regulations. He also previews steps his group is taking to help states prepare for Clean Power Plan compliance and comments on the American Legislative Exchange Council's efforts to influence the future of the plan through model laws and regulations.
Monica Trauzzi: Hello, and welcome to OnPoint. I'm Monica Trauzzi. With me today is Bill Becker, executive director of the National Association of Clean Air Agencies. Bill, nice to have you back on the show.
William Becker: Thanks for having me.
Monica Trauzzi: Bill, your organization recently released the results of a survey focused on the ability of states and local air agencies to implement tighter air standards than what the federal government requires. What are you contending the Clean Air Act allows for and what are you actually seeing on the ground?
William Becker: Well, the Clean Air Act allows, almost without exception, for states under Section 116 of the act to adopt more stringent than the federal government, and states historically have used this in many instances. But what we're finding is, according to this survey, about half the states, notwithstanding Section 116, are constrained by state law, state policy or state regulation from adopting regulations more stringent than the federal minimum.
Monica Trauzzi: So which rules, regulations does this specifically apply to?
William Becker: It's mainly toxics. It's smog-forming emissions and their criteria pollutants. Most of the core programs that we implement are affected by this, and there's an important practical implication. It's important that EPA recognize that when they develop a federal rule, that they not stop short of what is technologically feasible and cost-effective and assume that the states are going to be able to fill the gap that's created by stopping short. Rather, they need to understand that about half the country are going to be stuck with the rule they adopt, and therefore, it's important that they take that extra step to fill those gaps.
Monica Trauzzi: So all the focus right now, or most of the focus here in Washington, is on the Clean Power Plan. Is there a tie-in to the Clean Power Plan?
William Becker: There may be a little tie-in, but to EPA's credit, they are providing states, under the Clean Power Plan, maximum flexibility. Gina McCarthy the other day said, "We do not want to be Big Brother to the states. We are not going to second-guess the states' decisions." So in this particular instance, states are going to have, hopefully, full flexibility and are going to take advantage of that flexibility.
Monica Trauzzi: The agency, the administrator have all pointed to regional trading schemes as an effective tool for complying with the Clean Power Plan. Do you think all of that flexibility could make it difficult for regional trading schemes to come together?
William Becker: You know, I actually think it will make it easier. EPA is promoting that as one idea. They're not demanding that it be done. The states have been engaged in many, many discussions amongst themselves and with stakeholders, and what they're finding is that there are opportunities for regional programs, for mass-based interstate programs that will make it far more easier in the long run and administratively expedient to implement the program. I don't know how many in the end will take advantage of this, but the opportunity is provided, and a lot of states are talking about it now.
Monica Trauzzi: What are the state and local air agencies that your organization represents looking for from the agency as it crafts its final rule?
William Becker: We're looking for a number of changes to be made that will make this rule easier and fairer to implement. We're looking for some certainty on the phase-in, the interim requirements. Many states have said that it's front-end-loaded in 2020, and EPA has acknowledged that they may try to fix that. We're looking for resources from the EPA and the federal government to implement this program. It can't be implemented without additional resources, and this is part of the congressional appropriation that is going to affect our ability to implement. We're looking for guidance in many of the programs under the Clean Power Plan. Certainty is really important, and it's very, very important for EPA to answer its states' questions as quickly as possible so that we can plan accordingly.
Monica Trauzzi: Does the resources element tie into some of the economic concerns that we're hearing about the Clean Power Plan?
William Becker: The resources tie in in one regard. Industry is really concerned about certainty, about knowing what their requirements are and so that they can plan accordingly. If the states don't have sufficient resources to develop the plans and provide industry the certainty, then the impacts could be far more severe than they otherwise would be.
Monica Trauzzi: So what are you working on right now that you hope will help tee things up for the states come June?
William Becker: We have two very exciting projects that we're working on, and the common denominator of these projects are to make this implementation phase far easier than it otherwise would be. We're developing a menu of options that will identify literally every technological programmatic measure that could be adopted by a state and included in their plan, and for each of those 27 chapters in our report, we're going to be talking about the cost-effectiveness, the greenhouse gas reductions, the collateral benefits, the experiences and so forth. In addition, we're developing a model plan, a set of pathways for implementation, and we will be providing regulatory language for each of these pathways. So if somebody wants to pursue a rate-based approach, we're going to have language for that; a mass-based approach, same. We're going to put together model regulatory language for a statewide plan and for an interstate plan, and we'll have model regulatory language for demand-side energy efficiency and many of the other building block components of compliance. So this is intended to help states meet these requirements quickly and not have to reinvent the wheel every time someone decides to develop regulatory language.
Monica Trauzzi: Many states in their public comments pointed to serious economic and reliability challenges resulting from the rule. How aggressive do you expect the litigation will be?
William Becker: Litigation will be aggressive irrespective of reliability issues. Just a point on reliability, we also are working with NARUC, the utility commissioners, and NASEO, the state energy officials ... to address the kinds of problems that could arise under implementation of the Clean Power Plan. And we are mindful, very mindful of the potential impacts of reliability concerns, and we are trying to address them head-on. We think that industry is being given, you know, 15 years to get this right, to comply, and if EPA addresses the interim phase and phases it in as opposed to front-loading it, it'll even be easier and we'll be able to avoid those reliability impacts.
Monica Trauzzi: How big of a role should FERC be playing in that conversation?
William Becker: We don't have a position on that. I know that EPA talks to FERC. I don't know if they need to have any, you know, additional formal approach, but we have no comment on that.
Monica Trauzzi: I want to get one final question in. The American Legislative Exchange Council, ALEC, they're having an impact with model laws and regulations. How does your organization and how do your members handle the pressure that ALEC is placing on state legislatures?
William Becker: Well, here's what I don't get. Whether it's ALEC or some other groups, these groups are shopping around model legislation to tie the hands of states from addressing compliance options beyond just Building Block 1. And instead of giving the states, as state legislatures should, full flexibility as to which options they select in complying, some of these groups are constraining the compliance options to just what's inside the fence line, and it seems to me and to many of our members that this takes away any ability to look at other measures that can achieve these targets cost-effectively and much more easily than if you have to achieve the targets just within a narrow framework.
Monica Trauzzi: And they would argue that they are trying to limit the government's role overall.
William Becker: Well, and others would argue that they're trying to make this program far more costly than it needs to be and perhaps fail when it shouldn't have to.
Monica Trauzzi: All right, Bill. We'll end it there. Thank you for coming on the show. Nice to see you again.
William Becker: Nice to see you. Thanks very much.
Monica Trauzzi: And thanks for watching. We'll see you back here tomorrow.
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