President Obama’s War on Western Coal Demand

by William Yeatman on March 15, 2011

in Blog, Features

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The Environmental Protection Agency is using an obscure aesthetic regulation in the Clean Air Act to run roughshod over western states.

East of the Mississippi, President Barack Obama’s regulatory crackdown on coal threatens to shutter up to 40 gigawatts of electricity generation. Yet due to a variety of factors (the low sulfur content of western coal, low population density, and newer plant stock), coal-fired plants west of the Mississippi are in a much better position to withstand the regulatory onslaught .

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. In practice, eastern states are exempt from Regional Haze requirements, because the EPA allows states to meet this aesthetic regulation in the course of complying with health-based regulations.

Here’s a bare bones timeline of the Regional Haze regulation:

  • In 1977, the Congress amended the Clean Air Act to include, among other things, a Regional Haze provision to improve visibility at national parks and wildlife areas.
  • At the time, however, the science of visibility was highly uncertain. In 1980, EPA deferred promulgating substantive regional haze regulations until the science improved.
  • In 1990, the Congress again amended the Clean Air Act, and, in so doing, appropriated funds for a scientific study of visibility that could be used to create Regional Haze regulations.
  • In 1999, the EPA promulgated a substantive regional haze regulation. It set forth a national goal of achieving “natural” air quality conditions by 2064.
  • In July 2005, the EPA issued a guidance document to assist states in implementing regional haze controls.
  • December 17, 2007, was the deadline for states to submit State Implementation Plans to achieve BART. Only a couple states bothered to submit a plan.
  • On January 9, 2009, the EPA made a finding of failure to submit all or a portion of their regional haze State Implementation Plans (SIPs) for 37 states. This notice started a two-year countdown to a new deadline for regional haze state implementation plan submissions.
  • January 9, 2011 was the second deadline.

And here’s a barebones breakdown of what regional haze regulation entails

  • Unique among Clean Air Act provisions, states are accorded primary authority to achieve regional haze rules.
  • Regional haze applies to stationary sources, although there is no prohibition of regulating mobile sources.
  • The regulation of stationary sources is performed through the “BART” process (Best Available Retrofit Technology).
  • A stationary source is subject to regional haze emissions controls if it was built between 1962 and 1977, and if it worsens visibility at a national park by at least .5 deciviews. A deciview is loosely defined as a 10% attenuation of visibility, and peer reviewed scientific research suggests that there is a 17%-35% chance that a human would notice a 1 deciview improvement.
  • For BART eligible sources, the state has great latitude in choosing a pollution control, especially for power plants that are less than 750 megawatts.

Despite the fact that states have primacy over this aesthetic regulation, the EPA is aggressively imposing an anti-coal agenda. In so doing, the EPA has engendered a backlash in many western states, but the battle lines are starkest in Oklahoma, where public officials are waging a public battle against the EPA’s Regional Haze machinations.

In late 2010, the Oklahoma Corporation Commission approved a Regional Haze implementation plan that would switch fuels from coal to natural gas in six power plants. Fuel switching is a drastic response, especially for an aesthetic regulation, but it wasn’t good enough for the EPA, which is demanding that the switch take place 10 years sooner. If not, the EPA is requiring pollution controls that would increase electricity prices in Oklahoma by 10 to 12 percent.

Oklahoma public officials are balking at the EPA’s proposed cost—roughly $2 billion—of complying with an aesthetic regulation. In December, Corporations Commission Chair Dana Murphy issued a public letter accusing the EPA of trying to impose a plan that “needless jeopardizes our economy.”

Neither the EPA nor Oklahoma appears willing to back down, so this dispute likely will end up in court.

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