The Regulations are Coming, the Regulations are Coming

Marita Noon

11/11/2012 12:01:00 AM

 

Part of the hope the Romney campaign offered was a comprehension of the role energy plays in the American economy—especially energy that is abundant, affordable, and available. He made “energy” the number one point of his five-point plan. During his now-unsuccessful bid for the White House, he met with industry leaders from a variety of sectors to determine what would unleash job growth and economic development.

Those meetings, and America’s current predicament, brought about a transformation in his thinking and resulted in specific agendas designed to roll back the Obama Administration’s onerous regulations—specifically those imposed by Lisa Jackson’s Environmental Protection Agency (EPA)

Many of the EPA regulations, such as the Mercury and Air Toxic Standards for Power Plants and Boiler MACT (Maximum Achievable Control Technology) Rule, are particularly destructive to the coal industry. Understanding the death knell the Obama Administrations’ regulations were issuing to the coal industry and, more particularly, the miners and their families in Appalachia, the region rallied around Romney.

On Friday, November 9, a coal industry newsletter stated: “In President Barack Obama’s second term, U.S. coal producers are bracing for tighter regulation of everything from emissions from coal-burning plants, to coal ash, to respirable coal dust in mines, to Appalachian surface-mining activities. … One example is the U.S. EPA’s Mercury and Air Toxics Standards, one of the most costly rules in EPA history.”

In her book Regulating to Disaster, economist Diana Furchtgott-Roth describes the regulations this way:

“The Mercury and Air Toxic Standards for Power Plants rule will make electricity generation far more complex and expensive, especially in the eastern half of the United States. It will require the closure of many coal- and oil-fired power plants, and placement of emissions control equipment on others.”

“Maximum Achievable Control Technology means that plants and boilers have to use the most stringent methods possible to get heavy metals out of the air, even if these methods cost billions and the benefits are worth far less—as the case with the new utility rule. That is why many plants will have to close.”

Furchtgott-Roth explains that the new regulations mean “higher electricity prices for these parts of the country, which are already suffering from declining manufacturing.” Interestingly, she points out that the “battleground states of Illinois, Ohio, Indiana, Florida and Michigan” will be hit particularly hard by the increased electricity rates brought about by the regulations—regulations that a Romney presidency would have likely overturned.

For example, while I did not have access to Team Romney’s plans for either the Mercury and Air Toxic Standards or Boiler MACT, I do have white papers on other blows to coal, such as the Cooling Water Intake Structures Rule—which “affects thousands of existing power plants and manufacturing facilities that generate electricity or manufacture other goods and that also withdraw at least 2 million gallons per day of cooling water.”

The Romney document states: “The proposed rule imposes a huge regulatory burden for little environmental benefit; EPA’s own estimate of total annualized compliance costs for the impingement standard alone is $384 million, while it estimates that the cost will yield only $18 million in annualized benefits. Moreover, the rule requires the power industry to bear cumulative costs that have not been analyzed by EPA.” It delineates actions to be taken through either litigation and/or executive order.

Following the Obama victory, the specifics of the Romney plan are irrelevant—other than to note that plans did exist that would have saved jobs and kept electricity rates low. In West Virginia, which has had 80% of its electricity generated from coal, regulations have already nearly doubled electricity rates in just the past few years.

Valerie Jarrett, often referred to as the brains of the White House, is reported to have threatened anyone who opposes them with punitive actions: “After we win this election, it’s our turn.  Payback time.  Everyone not with us is against us and they better be ready because we don’t forget. The ones who helped us will be rewarded; the ones who opposed us will get what they deserve. There is going to be hell to pay.”

The coal industry, already under attack, came out en masse for Romney in hopes of saving their communities and livelihoods. In the current climate, a Romney victory was their only hope.

In September, Alpha Natural Resources announced major lay-offs—with 400 jobs already eliminated and nearly 1000 more to take place in 2013, production cuts, and the closure of eight mines. Presumably, a Romney win could have reversed the economic devastation—in Eastern Kentucky alone, more than 2000 jobs have been lost in 2012.

Apparently Teco Energy also saw the writing on the wall and was hoping against hope for a Romney presidency. Two days after President Obama was re-elected, Teco Coal Company announced major lay-offs. Likewise, Murray Energy released a statement saying “it would give pink slips to 102 workers at its West Ridge Mine in Utah and 54 at its underground mine in the southern Illinois town of Galatia.”

In a prayer Bob Murray read to his staff before letting them go, he said: “My regret, Lord, is that our young people, including those in my own family, never will know what America was like or might have been. They will pay the price in their reduced standard of living and, most especially, reduced freedom. … Lord, please forgive me and anyone with me in Murray Energy Corp. for the decisions that we are now forced to make to preserve the very existence of any of the enterprises that you have helped us build. We ask for your guidance in this drastic time with the drastic decisions that will be made to have any hope of our survival as an American business enterprise.”

Wasting no time on the “payback” threat, also on Friday, the Department of Interior (DOI) “issued a final plan to close 1.6 million acres of federal land in the West originally slated for oil shale development.”

With the Jarrett threat dangling, the EPA is likely to tighten the regulatory screws on the coal industry—raising electricity rates and increasing lay-offs in an already hard-hit region. The DOI will continue to restrict oil and gas development—pumping up gasoline prices and hurting the middle class and the poor.  

Many of us hoped to wake up Tuesday, November 7, to a feeling of freedom, flexibility and fun. Instead, we find ourselves facing four more years of regulation, restriction, and rancor.