NAM testifies on EPA’s unreasonable GHG regulatory proposal

NAM Vice President of Energy and Resources Policy Ross Eisenberg testified before the House Subcommittee on Energy and Power on November 14 at a hearing on the Environmental Protection Agency’s (EPA) proposed greenhouse gas (GHG) standards for new power plants. Eisenberg offered the NAM’s support for draft legislation by subcommittee Chairman Ed Whitfield (R-KY) and Sen. Joe Manchin (D-WV) that would make the regulations more reasonable and protect a true “all-of-the-above” energy strategy.

“Manufacturers are deeply concerned with the EPA’s decisions in the rule for future power plants and fear that the agency is heading down a path toward a costly, unworkable set of standards for existing power plants,” Eisenberg testified.

“While over the years there have been a wide range of legislative and regulatory proposals to address GHG emissions, it is impossible to ignore the harsh reality that this policy—the one we have chosen—could be both the most expensive and least environmentally effective of them all,” he said.

“Manufacturers ultimately will be hit twice by the EPA’s GHG regulations—both as users of the energy being regulated and as industries considered ‘next in line’ to receive similar regulations from the EPA for their own plants. A poorly crafted rule on existing power plants that results in the limitation of coal or natural gas could pose serious problems for manufacturers. These fuels will remain the dominant sources of energy in the United States for many years.” Eisenberg noted that “the nexus between coal, natural gas and manufacturing is even more pronounced when viewed at the state level” in places like Indiana, Louisiana and Ohio.

Eisenberg also told subcommittee members that the establishment of federal climate change policies to reduce GHG emissions, whether legislative or regulatory, must be done in a thoughtful, deliberative and transparent process that ensures a competitive level playing field for U.S. companies in the global marketplace. “Any climate change policies should focus on cost-effective reductions, be implemented in concert with all major emitting nations and take into account all GHG sources and sinks,” he said.

The NAM has led the charge in speaking out against the EPA’s carbon dioxide (CO2) New Source Performance Standard for new fossil fuel–fired power plants, which was re-proposed on September 20. The rule sets CO2 emissions standards for both natural gas combined-cycle units and coal-fired units. The coal standard would require the deployment of carbon capture and sequestration, a technology that has a promising future but is not commercially viable. The practical impact of this rule will be a de facto ban on new coal-fired power plants.

For manufacturers that depend on an “all-of-the-above” energy strategy for low-cost, reliable energy, this rule sets a very dangerous precedent. In June 2014, the EPA is expected to roll out the next phase of the President’s Climate Action Plan with similar rules for existing power plants, followed eventually by rules directly regulating manufacturers’ CO2 emissions. It is unknown how the agency will address existing power plants and manufacturing facilities in future regulations; however, if this latest rule is any indication, the EPA is headed down the most costly and restrictive regulatory path.

The NAM will continue to call on Congress to set firm limitations on how the EPA uses the Clean Air Act to regulate GHGs and to consider all options to push back against EPA overreach.

Click here for Eisenberg’s testimony.

Read our interview with Chairman Whitfield about the harm of regulatory overreach in the July issue ofMember Focus, the NAM’s flagship monthly digital magazine.

Last month, the U.S. Supreme Court agreed to hear our case challenging the EPA’s first-ever GHG permitting regulation for stationary sources. The decision gives the Court the opportunity to limit the EPA’s overreach and requires the agency to revisit this very costly policy. This is a prime example of how our new Manufacturers’ Center for Legal Action can seek relief from the courts for excessive regulation, unfounded statutory interpretations and unconstitutional acts affecting manufacturers.