Proposed CO2 Standards: Expensive Hot Air

By Benita M. Dodd

(This commentary is the basis for testimony by Benita Dodd on behalf of the Georgia Public Policy Foundation at the EPA Listening Session on 111(d) Carbon Pollution Standards for Existing Power Plants in Atlanta on October 23 and was submitted in full to the EPA.)

BENITA DODD Vice President, Georgia Public Policy Foundation

Vice President, Georgia Public Policy Foundation

The Foundation believes that tougher standards on carbon dioxide emissions being proposed by the Environmental Protection Agency and under discussion at the EPA’s 11 listening sessions around the nation will have unfortunate consequences for the United States.

This nation holds the world’s largest estimated recoverable reserves of coal; in fact, the United States is a net exporter of coal. In 2012, 81 percent of the coal produced in the nation was used by U.S. power plants to generate electricity, providing 42 percent of the energy mix.1 The currently recoverable coal reserves represent enough coal to last 194-236 years.

The importance of coal in Georgia’s energy mix is not to be underestimated, either. According to the EIA, of the state’s electricity generation in 2011, coal accounted for 48 percent.2 The mix has changed somewhat now that natural gas factors in.3 Still, coal remains a crucial and reliable domestic source of energy.

Now comes the proposed regulation under the president’s Climate Action Plan. According to the EPA Web site, “Carbon dioxide (CO2) is the primary greenhouse gas pollutant, accounting for nearly three-quarters of global greenhouse gas emissions and 84 percent of U.S. greenhouse gas emissions.”

The EPA is working to redefine a gas that every living being exhales into a pollutant. Carbon dioxide emissions do not equate to carbon dioxide pollution. Further, water vapor is the primary greenhouse gas. And we exhale that, too. Should we regulate water vapor?

The EPA is proposing a standard not yet met by any coal plant. The EPA finds the standards “will result in negligible CO2 emission changes… by 2022.”4 And it “will result in negligible changes in GHG emissions … Even in the absence of this rule, the EPA expects that owners of new units will choose generation technologies that meet these standards due to expected economic conditions in the marketplace.”5

If the EPA believes the marketplace is heading that way, and that the standard will have no impact on emissions, why promulgate this regulation? How responsible is it that producers will be shipping coal abroad instead, where environmental standards frequently are less stringent?

This proposed standard threatens future domestic use of an abundant and reliable energy resource, which utilities have used responsibly to provide affordable energy to consumers. Just this week, the EIA announced that 2012 U.S. carbon dioxide emissions from the consumption of fossil fuels declined almost 4 percent from the 2011 level. Energy-related CO2 emissions have declined in five of the last seven years and are the lowest they have been since 1994.6 American innovation, efficiency and a mix of energy sources are providing greater air quality improvements than government can.

This future of U.S. coal-fired plants and a dependable domestic source of fuel will be endangered by this proposal, and with it, our nation’s economic prosperity. As Americans continue to recover from the Great Recession, the federal government has a responsibility to ensure that citizens and industry are not burdened by higher energy prices because of policies that it readily admits will have minimal effect.