EPA CO2 Regulation Effectively Bans New Coal Facilities

Romina Boccia
March 27, 2012 at 5:40 pm
Heritage.Org

The Environmental Protection Agency (EPA) released a new rule to regulate CO2 emissions from power plants, which would effectively ban new coal power plants, as its emissions standards are too low to be met by conventional coal-fired facilities.

This stands in stark contrast with the President’s supposed “all of the above energy approach” and sends a strong signal that coal is not part of the President’s energy vision for America. In combination with other EPA regulations that contribute to the premature shutdown of existing coal plants, the EPA’s actions represent one of the greatest threats to the electric sector and America’s energy supply.

The new rule requires power plants to meet an output-based standard of 1,000 pounds of CO2 per megawatt-hour of electricity produced. Other than natural gas-fired power plants built in recent years, most power plants, and especially coal-fired ones, would fail to meet that standard.

Bloomberg reports:

The average U.S. coal plant emits 2,249 pounds of carbon dioxide for each megawatt hour of power produced, compared with 1,135 pounds for a natural gas plant, according to the EPA.

While existing power plants and those holding EPA permits for upcoming construction would be excluded, the rule would prevent any new coal-fired power plants from being built unless they were outfitted with carbon-reducing technology, such as carbon capture and storage (CCS). CCS is still a very expensive technology, and questions remain about where to store the captured carbon.

Although the EPA’s CO2 regulations rest on a shaky “endangerment” finding, they would have far-reaching effects on the American economy. Heritage Foundation research studying the economic impact from EPA’s CO2 emissions restrictions found:

Regulating CO2 emissions under the Clean Air Act will burden the economy with higher energy costs, higher administrative compliance costs for businesses, higher bureaucratic costs for enforcing the regulations, and higher legal costs from the inevitable litigation.

For average Americans, the expensive EPA rule would mean higher energy costs, fewer jobs, and a less prosperous economy. A recent video by Energy for America shows the real-life impact of regulations and subsidies for alternative energies—designed to reduce coal’s contribution to the nation’s energy supply—on the residents of Craig, Colorado, an economy fueled by coal.

It’s important to remember that the greatest progress toward environmental protection has not been accomplished by government regulation but through greater economic growth. Economic freedom and freer trade promote economic growth and prosperity, which provides society with the wealth and resources to pursue sound environmental policies. Increased government regulation, on the other hand, would stifle economic growth and could lead to counterproductive environmental results. As Heritage’s Terry Miller and Anthony Kim explain:

Policy efforts aimed at imposing stricter environmental standards…undercut the economic growth necessary for greater efforts to protect the environment. Such regulations only serve as feel-good actions, without generating real “change” that could mitigate climate change and its possible negative impacts.

Case in point: regulations subjecting existing coal plants that wish to make upgrades to costly and exhaustive New Source Review requirements, which actually discourage energy efficiency and safety improvements that plants would undertake on their own accord.

Congress should step up and stop the EPA from bypassing Congress’s sound rejection of cap and trade. The EPA regulations on CO2 are just one of those other ways to skin the cat, as President Obama famously promised.