EPA Imposes $370 Million Regulation on New Mexico, for Invisible Benefits

by William Yeatman on August 19, 2011

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There is a regional dichotomy to the Environmental Protection Agency’s war on coal demand. East of the Mississippi River, the EPA is cracking down on coal using the Cross-State Air Pollution Rule. Thanks to lower population density, an abundance of low sulfur coal, and newer plant stock, most states west of the Mississippi are not subject to this regulation.

In order to target western coal, the Environmental Protection Agency is leveraging a long ignored provision of the Clean Air Act designed to improve visibility, known as the Regional Haze rule. Notably, this is an aesthetic regulation, not a health-based regulation. Another facet of the rule is the unique discretion it affords states. According to the EPA’s 2005 Regional Haze guidelines, “Congress evinced a special concerning with insuring that states would be the decision-makers.” Also in the 2005 guidelines, the EPA established recommended emissions controls to comply with the visibility regulation. These recommendations are known as “presumptive limits.”

In a recent oped for the Albuquerque Journal, I explain how the EPA is abusing the Regional Haze rule to run roughshod over elected officials in New Mexico. Here’s the gist:

On June 2, the state Environmental Improvement Board unanimously approved a Regional Haze plan that would meet the EPA’s “presumptive limits” by spending $34 million to retrofit the San Juan Generating Station, a coal-fired power plant 15 miles west of Farmington.

Despite comporting with both federal guidelines and state law, these controls weren’t good enough for the EPA.

Perhaps this has something to do with President Barack Obama’s campaign promise to “bankrupt” the American coal industry.

Whatever its rationale, [on August 5th] the EPA imposed Regional Haze retrofits at San Juan that would cost New Mexico ratepayers $370 million – a nearly tenfold increase over those approved by New Mexico officials.

And what does this huge sum buy? Not much.

Based on peer-reviewed research, there is a 35 percent chance that the visibility “benefit” of the EPA’s preferred controls could be perceptible by the general population on the seventh-worst visibility day of the year at Mesa Verde, the national park closest to the San Juan Generating Station.

In other words, most people won’t even notice the difference wrought by the EPA’s ultra-expensive controls.

But New Mexicans certainly will notice the difference in their utility bills!

PNM estimates that the EIB-proposed controls would result in a rate increase of $12 a year, while the EPA-proposed controls would increase rates by $82 a year – almost seven times more.

Yesterday, I discussed the EPA’s shenanigans in New Mexico on Liberty Week, the CEI podcast, available here.

To read a primer on the Regional Haze rule, click here.

Ronald Czarnecki August 20, 2011 at 11:46 am

Great article! Totally supports what I’ve been talking about at: http://sleeplessandtired.com/?p=3487

Obama is killing jobs, industry and the consumer who, as always, picks up the tab.

His only fulfilled promise from 2008: Bankrupting the coal industry. He didn’t have any idea then, nor does he now, that he is bankrupting the consumer and the country.

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