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Post image for Judge Kavanaugh’s Dissent in the EPA Mercury Rule Case: Will the Supreme Court Review EPA’s De-facto Ban on New Coal Generation?

Yesterday, the D.C. Circuit Court of Appeals ruled 2-1 to uphold the EPA’s nonsensical Mercury Air Toxics Standards (MATS) Rule. The MATS Rule requires electric utilities to install maximum achievable control technology (MACT) to reduce emissions of mercury and other hazardous air pollutants (HAPs) from coal-fired power plants.

The rule is nonsensical because, as explained below, although one of the most expensive regulations in history (officially estimated at $9.6 billion in 2016), its health benefits are illusory. Moreover, the Rule is a de-facto ban on the construction of new coal electric generation, a policy Congress has never approved. Indeed, even when the Democrats controlled both chambers of Congress, a bill embodying the MATS Rule’s regulatory requirements would have been dead on arrival.

In the case, titled White Stallion Energy Center LLC et al. v. EPA et al., Judge Brett Kavanaugh wrote a powerful dissenting opinion, as my colleague William Yeatman noted yesterday. Kavanaugh agreed with industry petitioners that EPA unreasonably excluded cost considerations (economic impacts) when determining whether MACT regulation of power plant HAPs is “appropriate and necessary.”

The two-judge majority partly based their opinion on the Supreme Court’s ruling in Whitman v. American Trucking Ass’ns (2001) that EPA may not take costs into consideration when setting national ambient air quality standards (NAAQS).

Kavanaugh argues the majority ‘misreads’ or ‘over-reads’ Whitman by ignoring a key difference between the Clean Air Act provisions governing NAAQS rulemakings – §108(a) and §109(b) – and the provision addressing potential MACT regulation of power plant HAPs – §112(n)(1)(A).

The NAAQS provisions clearly allow no room for cost considerations. If an air pollutant is emitted by numerous or diverse mobile or stationary sources and the associated air pollution is reasonably anticipated to endanger public health or welfare, then, pursuant to §108(a), EPA must establish NAAQS for those pollutants, and, pursuant to §109(b), the standards must be requisite to protect public health with an adequate margin of safety. Period. End of story.

In contrast, §112(n)(1)(A) requires EPA to study and issue a report on the public health hazards anticipated to occur as a result of power plant HAP emissions, and then apply MACT regulation “if” the Administrator “finds such regulation is appropriate and necessary.” The provision does not define the terms “appropriate” and “necessary.” Common sense suggests that a regulation is “appropriate” if the benefits justify the costs.

Perhaps more importantly, §112 tasks EPA to determine whether MACT regulation of HAPs is “appropriate and necessary” only for “electric steam generating units.” For HAPs from all other source categories, EPA has no discretion and is simply required to promulgate MACT regulations. The statute thus seems to contemplate that, in the special case of coal power plants, MACT regulation may not be appropriate even if the associated HAP emissions pose public health hazards. In other words, a less stringent form of Clean Air Act regulation (such as new source performance standards) or state-level regulation might be “appropriate.”

Yeatman opines that Kavanaugh’s dissent may persuade the Supreme Court to review the case. If so, the Court might rule that EPA is allowed or even required to consider costs when determining what is “appropriate” when regulating HAP emissions from power plants. That, in turn, could set the stage for litigation on whether the MATS Rule is too costly to be “appropriate” within the meaning of the statute.

Of course, EPA contends the MATS Rule is a bargain at almost any price, delivering $33 billion to $89 billion in annual health benefits. Litigation reviving public debate on such claims could be a great teaching moment.

Our June 2012 study, All Pain and No Gain, provides a detailed critique of EPA’s MATS Rule health benefit estimates. Below is a summary of key points. [click to continue…]

A new report from the non-partisan Congressional Research Service confirms what we’ve long been saying: Oil and gas production has declined on federal lands during the Obama administration. Oil production is down 6%, while gas production is down a whopping 28%. These decreases have occurred despite the revolution in drilling productivity wrought by the advent of hydraulic fracturing technology, or “fracking.” During the same period that federal output has been falling, oil production increased 61 % on state and private lands, while gas production grew 33 %. The CRS report, which I’ve re-posted below, puts the lie once and for all to the President’s false claim that he’s somehow responsible for the U.S. oil and gas boom. In fact, drilling is up in spite of the President, not because of him.

CRS report on drilling on federal lands

Yesterday, the National Association of Manufacturers announced the launch of an ad campaign targeting EPA’s pending revision of the national ozone standard. The pitch, which I’ve re-posted immediately below, is running in 10 States: Arkansas, Colorado, Minnesota, North Carolina, Virginia, Iowa, Michigan, West Virginia, Kentucky, Ohio, and Missouri.

 

The National Association of Manufacturers has every reason to fear the ozone rule, as do all Americans. The minimum standard that EPA is considering would trigger the Clean Air Act’s ultra-onerous “Part D” controls for 75% of the country; at most, this unfortunate fate would befall 96 % of the country. By EPA’s own accounting, the regulation could cost up to $90 billion a year—even though the agency concedes that only $23 billion in ozone emissions controls is known to exist. To clarify, this means that the rule could necessitate the creation, out of whole cloth, of almost $70 billion a year in control technologies.

But it’s not EPA’s fault! In fact, the agency doesn’t have the discretion to set the ozone standard. Instead, this responsibility is given to an insular group of advisers, the seven-member Clean Air Science Advisory Committee (CASAC). There are trillions of dollars at stake—that’s TRILLIONS, with a T—yet CASAC is in no way accountable to U.S. voters. Indeed, virtually no voters know of this group’s existence.  Worst of all, CASAC is uniquely ill-suited to designate a standard for a non-threshold pollutant like ozone, due to a professional bias. In this post, I will explain briefly this undemocratic, yet ultra-powerful, institution of environmental policy-making.

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Post image for MoJo Not Always Wrong on Energy

Mother Jones (“MoJo”) is a lefty rag with an unrealistic outlook on life. Once in a while, though, they get it right.

For example, MoJo hates taxpayer subsidized high speed rail in California. Well, I also hate taxpayer subsidized high-speed rail in California. And for the same reason! We both see it as being an unrealistic boondoogle.

This week, MoJo again made a modicum of sense with a well-written and good-looking interactive piece that both explains and decries tax breaks for oil and gas producers. It’s a worthwhile read. Regardless MoJo’s evident disdain for an industry that has been the only bright spot in the U.S. economy since the great global recession, the article is fact-filled and it has some neat infocharts.

And again, MoJo’s is a message with which I agree. Industry specific tax breaks—indeed, all preferential tax treatments—are inefficient and wasteful. I’m with MoJo: Let’s do away with oil and gas’s perks…

….And, at the same time, let’s do away with wind and solar and ethanol and all other “green” energy subsidies and mandates. Then, let’s wait 5 years, and here’s what I bet we’ll see: the utter absence of green energy, having been wholly vanquished on the market by conventional energy sources*. Because green energy tends to be expensive, intermittent, or both, the industry cannot exist absent political favoritism. Otherwise, no one would buy its products. On the other hand, conventional energy sources, primarily fossil fuels, aren’t wholly reliant on taxpayer handouts and mandates, as consumers would buy these products of their own accord.

Don’t take my word for it! Even the top lobbyist for the wind energy industry admits that his clients would go “bust” if the Congress fails to extend a single subsidy, despite the fact that the industry enjoys mandates forcing ratepayers to buy their energy in 30 States.

*Absent, of course, all of the expensive, long-term contracts that utilities have signed with green energy developers, in order to achieve the aforementioned green energy mandates in 30 States.

Updated: For an analysis of Judge Kavanaugh’s excellent dissenting opinion, see below the break.

Today, the D.C. Circuit Court of Appeals rendered a split 2-1 decision that upholds the Environmental Protection Agency’s Mercury and Air Toxics Standards regulation, also known as the Utility MACT. The decision in White Stallion Energy Center LLC et al. v. EPA et al. is available here.

As I explain here, the absurd justification for the mercury rule, one of the most expensive and consequential regulations of all time, is to protect a supposed population of pregnant subsistence fisherwomen, who consume hundreds of pounds of self-caught fish from exclusively the most polluted inland bodies of fresh water.

There is a “narrow” dissent by Judge Brett Kavanaugh, as described by InsideEPA. I’ll update this post when I’ve digested the decision. [See update after the break]. Below, I’ve posted an image depicting the costs and (supposed*) beneficiaries of EPA’s mercury rule.

coal retirments foto2

*EPA has never actually identified a pregnant, subsistence fisherwoman of the sort it purports to protect. Rather they are modeled to exist.

1:36 PM Updated: I’ve digested Judge Brett Kavanaugh’s dissenting opinion. As I note above, his dissent has been described in the press as being “narrow.” I disagree. In fact, it is a strong opinion, and, more importantly, it describes the exact path to obtaining Supreme Court review of the split decision.

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Post image for Bipartisanship Alive and Well in Opposition to O’s Anti-Energy Policies

We are bombarded daily with stories bemoaning the societal ills engendered by the hyper-partisanship of our present political discourse. It is, therefore, notable that both Republicans and Democrats can find common ground in opposing the worst excesses of this administration’s anti-energy policies.

Last week, for example, eleven Democratic Senators sent a letter to President Barack Obama urging him to stop dragging his feet over the Keystone Pipeline. Specifically, the letter demanded that the President make a final decision on whether to permit the pipeline by the end of May.  The signatories were Senators Heidi Heitkamp (ND), Mary Landrieu (LA), Mark Begich (AK), Mark Pryor (AR), Joe Manchin (WV), Joe Donnelly (IN), Claire McCaskill (MO), Mark Warner (VA), Jon Tester (MT), John Walsh (MT), and Kay Hagan (NC). To repeat:  twenty percent of the Senate Democratic caucus is goading the Democratic President on a Republican Party talking point. Bipartisanship lives!

Of course, the Senate is historically the more friendly of the two Chambers of Congress. The House is now widely perceived as being far more partisan, and therefore far more dysfunctional, relative to the Upper Chamber.

And yet, contrary to this perception, 15% of Democrats on the powerful House Transportation & Infrastructure Committee last week sided with ($) a unanimous Republican committee vote, and passed H.R. 524, legislation that would prohibit the Environmental Protection Agency from vetoing Clean Water Act permits that have already been issued by the U.S. Army Corps of Engineers.

The bill is a direct response to EPA’s January 2011 revocation of a Clean Water Act permit that had already been granted to a surface coal mining project in Logan County, West Virginia. (For much more, see here, here, and here). This was the first time EPA had claimed the authority to issue a retroactive veto; before, permits had been thought to have been akin to a property right (for their duration). EPA justified the veto as being necessary to protect an insect that isn’t an endangered species.

Evidently, EPA’s power grab was too much, even for members of the President’s own party. The bipartisan fear galvanizing H.R. 524 is that EPA now claims the authority to effectively end any business reliant on Clean Water Act permits, at any time, based on the flimsiest of justifications.

Thus, it was a banner week for bipartisanship. Not that you read or heard about it. To be sure, the media normally loves to trumpet whatever both parties can agree on, in this hyper-partisan age. In last week’s cases, however, the common ends (a decision on Keystone; checking the EPA) are uncomfortable for the opinion makers. I’ve noted previously media’s reluctance to acknowledge that opposition to climate change mitigation policies is also healthily bipartisan. (See here and here).

Yesterday morning, This Week with George Stephanopoulos’s humbly titled “Powerhouse Roundtable” was debating the resignation of HHS Secretary Kathleen Sebelius, when Matthew Dowd, a prominent political consultant, said this:

This is what’s wrong with our system of government…We have a cabinet that no longer operates like you would normally want in a state or in a company, so that people are given delegation and accountability is held. Today, all the power is held by the White House…and the cabinet is given very little. It’s all photo [opportunities].

I respectfully disagree. The Environmental Protection Agency, a cabinet-level federal agency with which American business is all too familiar, is doing much, much more harm than could be accomplished with mere “photo ops.” Indeed, the EPA is waging an ideological war on an entire industrial sector of the economy. Worst of all, the agency is doing so on behalf its captors—environmental special interests–rather than U.S. voters. To be precise, green groups like the Sierra Club and NRDC have “captured” EPA, in the same way that industry was thought to have done to regulators in the 1960s. These environmental organizations spend significant resources on getting their preferred candidates elected. In return, they enjoy political spoils. The most conspicuous manifestation of this capture is the continuously revolving door between the non-profit, public (i.e., EPA), and private “green” sectors of the economy. Another is “sue and settle,” by which environmental lawyers at these green special interests have seized the regulatory initiative at the agency. Thus empowered at the EPA, these organizations use the Federal State to advance their political agendas against heavy industry in general, and fossil fuels in particular.

Matthew Dowd says the cabinet is impotent, because the White House is hoarding all the control. Contrary to this assertion, EPA, in fact, is running amok, performing the policy whims of green special interests outside the Presidency.

Video of the segment is re-posted below.


ABC US News | ABC Business News

Post image for Will Cherry Blossoms Get Sucked into the Polar Vortex?

DC’s cherry trees hit their official peak blossom date last Thursday, April 10th.  That’s the latest in the year that the Capital has experienced peak blossoming in over two decades.  (For you botanical historians, the last time that peak blossoming occurred this late or later was in 1993, when the event fell on April 11.)

In 2013 the blossoms were almost as late, hitting their peak on April 9.  That was a pretty dramatic change from 2012, when the date fell on March 20. This change was most disconcerting to two groups: tourists trying to plan their trips to DC in advance, and global warming alarmists who trumpeted every earlier-than-expected cherry blossom as yet further proof of global warming.  In fact, in a sizzling multi-part blog post series last year, followed by dozens of readers, we charted peak blossom dates against global warming data.  We even had graphs.  (See Adam Sandberg, Peak Bloom Is Here – DC’s Global Warming Canary Lands with Frost on its Feet, April 15, 2013.)

The past two years of unusually late blooms largely resulted from unusually cold weather.  But unusually cold weather, in the view of White House Science Advisor John Holdren, is actually yet another sign of global warming.  Holdren explained this to a freezing yet grateful nation in a two-minute video last January entitled The Polar Vortex Explained in 2 Minutes.

We suspect that Holdren’s agency, the Office of Science and Technology Policy (OSTP), may now have a second video in the works in this Blame-Everything-On-Global-Warming series.  Perhaps they’ll call it Delayed Peak Blossoming Explained in 2 Minutes.

Regardless, we think Holdren’s first video is scientifically bogus, and so today we’re filing a formal Information Quality Act Correction Request with OSTP on that very issue.  Who knows—we may yet nip this video series in the bud.

Platts Energy Week with Bill Loveless: American Wind Energy Association CEO Tom Kiernan gave illuminating answers in an interview with Bill Loveless on Platts Energy Week. At the 2:40 mark of the video below, Mr. Kiernan explains that the wind energy industry would go “bust,” if the U.S. Congress fails to extend a subsidy that gives wind energy generators a tax credit worth $23 per megawatt electricity produced.

Mr. Kiernan’s dire warning was backed up by a report earlier this week from Energy & Environment News’s Nick Juliano, whose independent estimate that the wind energy industry would lose 30,000 jobs, virtually overnight, absent this one subsidy.

Keep in mind that thirty States have enacted Soviet style production quotas for green energy, and that wind energy meets the overwhelming preponderance of these mandates. Thus, the wind energy industry enjoys a government-guarantee for consumer demand. Few and lucky are the politically connected industries that receive such a state-sponsored perk.

And yet, despite these green energy production quotas, the industry faces imminent collapse, according to its own top lobbyists, if a single, albeit egregious, tax handout is allowed to expire.

Which brings me to my final point. In the interview, Mr. Kiernan innocently claims that the wind industry merits the $23 per megawatt tax credit, because it wants a “level playing field” with conventional energy. While I readily advocate for the elimination of all subsidies, I question whether Mr. Kiernan is sincere. Absent mandates and subsidies for all energy sources, and unless fossil fuels are regulated out of existence, wind energy would die a swift death at the hands of conventional energy on even a relatively free market. When competition matters, intermittent and expensive (i.e., renewable energy sources) simply are no substitutes for cheap and reliable (fossil fuels, that is).

The McLaughlin Group: Four months ago, I noted how John McLaughlin skewered global warming alarmists on his wonderful show, The McLaughlin Group. It was late December, and the show was having its annual awards broadcast. What prompted my attention was McLaughlin’s awarding of the “2013 Enough Already Award,” to “the theory that now masquerades under the pseudonym of climate change.” He then continued, “Even its most honest supporters now admit that there has been no increase in the earth’s surface temperatures for 15 years. It’s time to admit the theory is flawed.”

Great stuff. And it leaves no doubt as to where he stands on the issue. On this week’s show, we got more of the same. Near the end of the show, McLaughlin introduced a segment about global warming, titled “Apocalypse Now?” The question mark is operative. The topic of the segment was the recent release of an Intergovernmental Panel on Climate Change report. Before the start of the roundtable debate, there was a long video lead-in to the segment, featuring one scary IPCC prediction after another. See for yourself (it starts at the 21:55 mark): [click to continue…]

Post image for WaPo Wonkblog Makes Case that EPA’s Carbon Pollution Standard Is Illegal

On Friday, Washington Post Wonkblog published a notable article about “clean coal,” defined by reporter Max Ehrenfreund as “[t]he suite of technologies that the industry hopes could one day remove carbon dioxide from exhaust at coal-fired power.”

The most mature of these “clean coal” technologies is known as carbon capture and sequestration (“CCS”), although it has never been outfitted on a coal-fired power plant of even moderate size. The purpose of the Washington Post article was to throw cold water on recent media reports regarding the promise of clean coal. According to Mr. Ehrenfreund, the case for CCS in the U.S. is “weak,” because the technology is “exorbitantly expensive.”

Somewhat bizarrely, the Wonkblog reporter failed to mention that the Environmental Protection Agency in February proposed the Carbon Pollution Standard, a requirement for CCS on all new coal-fired power plants. Due to a unique provision of the Clean Air Act, the regulation goes into effect upon proposal. As a result, all new coal-fired power plants require “clean coal” technology—the very technology that is the subject of the Washington Post Wonkblog article. You’d think that this would qualify as “news.”

Whatever the reason for this rather conspicuous omission, I want to draw attention to the reporter’s use of language, which offers an important legal lesson. Mr. Ehrenfreund wrote that CCS is “exorbitantly” costly. This modifier is supremely apt; it is the exact word chosen by the D.C. Circuit Court of Appeals* to describe an impermissible requirement pursuant to the provision of the Clean Air Act that authorizes the aforementioned Carbon Pollution Standard. See Essex Chemical Corp. v. Ruckelshaus, 486 F. 2d 427 at 433 (D.C. Cir. 1973). As such, if the costs of carbon capture and sequestration are in fact “exorbitant,” then the regulation is illegal.

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