March 16, 2012

EPA rule will cost jobs

From: Pittsburgh Post-Gazette

By Cecil E. Roberts

Last December, the U.S. Environmental Protection Agency issued a final rule intended to reduce electric utility emissions of mercury and other air toxics. The EPA projected that less than 5,000 megawatts of older coal-fueled generating plants would be retired as a result of its Mercury and Air Toxics Standards rule.

The United Mine Workers of America and other unions met with EPA officials repeatedly over the course of the rulemaking to share our analysis of the rule’s potential impacts and to recommend several improvements to it. Our study suggested that up to 56,000 megawatts of electric generating capacity at smaller and older plants could be “at risk” of premature closure. We told EPA that as many as 54,000 direct jobs were at risk in the utility, mining and rail transport sectors, in addition to 200,000 jobs in related industries and communities impacted by plant closures.

We also made it clear that we supported the rule’s basic objective of reducing mercury and other harmful emissions. Our principal concerns were the inadequate time provided for compliance and the feasibility of meeting some of the proposed emission limits with different types of coal.

But the EPA ignored our concerns. Instead, the agency created a rule that not only will cause far more negative effects on the utility and coal industries than it is willing to admit; the rule will also make it next to impossible for new coal-fired power plants to be built based on current technologies.

This is bad policy and has the potential for serious repercussions for our nation’s energy security.

We are now seeing the tip of the job loss iceberg that will result from this rule. FirstEnergy, American Electric Power and other utilities have announced the closures of several plants in Ohio, Pennsylvania and West Virginia, directly affecting hundreds of plant workers and thousands of jobs in surrounding communities. Some of these plants were scheduled to be closed anyway — though not as quickly — but many were not.

More recently, PJM Interconnection announced the results of its survey of planned coal plant shutdowns. PJM coordinates utility generation in a region spanning New Jersey and Pennsylvania, south to Virginia and West Virginia and west to portions of Kentucky, Ohio, Michigan, Indiana and Illinois.

PJM reports that its member utilities plan to retire 14,000 megawatts of generating capacity by 2015 and another 4,000 megawatts by 2018. That’s a total of 18,000 megawatts, more than three times greater than the EPA’s national projection of plant closures.

PJM represents about one-fifth of coal generation affected by the EPA’s rules. So the potential magnitude of plant closures — if utilities in other regions plan to retire similar amounts of capacity — may make UMWA’s 56,000-megawatt projection a conservative estimate in the end.

The consequences for workers and communities would be devastating.

Electric generating plants are often located in rural areas, near coal supplies. They contribute substantially to local economies not only through the high wages paid to skilled workers in the utility, mining and transport sectors, but also by supporting local tax bases.

Estimates I’ve seen of lost tax revenues as a result of already-announced closures are devastating for these communities, such as more than $2 million in Oregon, Ohio, and $6.5 million in Eastlake, Ohio. That’s a lot of new police cars, fire trucks and textbooks that won’t be available where they are needed.

The new EPA rule creates another serious problem for the future of coal use and the people whose jobs depend on coal.

The Clean Air Act is intended to facilitate the transition from older, more heavily polluting facilities to new plants equipped with Best Available Control Technology. The UMWA has long supported the use of available emission control technologies on all coal plants, because it is a win-win for workers and the environment.

But the MATS rule contains a poison pill for new advanced coal development: a set of new source emission limits so stringent that equipment suppliers will not guarantee the ability of control technologies to meet them. These emission standards, based on limited short-term tests at single generating units, are simply not achievable in practice. This is a serious flaw in the rule that we intend to address further.

The UMWA has consistently agreed with those who call for cleaner air and reduced emissions. We continue to believe these are worthy goals that need to be pursued. And we believe that even the MATS rule can be modified so that it meets the goal of reducing mercury emissions from existing plants while giving the utilities the time they need to retrofit their plants with scrubbers capable of meeting the requirements.

That is why the UMWA supports the bipartisan Manchin-Coats bill, Senate Bill 1833. This bill accepts the environmental stringency of the EPA’s MATS rule, but provides an additional two years for compliance in view of the large number of facilities that will be competing for pollution control retrofits. The bill also harmonizes the compliance schedules of MATS and the EPA’s Cross-State Air Pollution Rule for reducing emissions of sulfur dioxide and nitrogen oxides.

The UMWA agrees with the “all of the above” approach for developing America’s energy resources. For instance, there is no good reason, with oil prices above $100 a barrel, why we are not utilizing our coal resources to produce gasoline and other fuels at prices well below what Americans now pay at the pump.

But America cannot afford “some of the above” policies that effectively prevent the deployment of advanced clean-coal technologies while encouraging a rush to natural gas. If “all of the above” is to be more than a political slogan, the Obama administration needs to reconsider EPA rules that stifle rather than encourage advanced coal technologies.

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