When the U.S. Supreme Court remanded the Environmental Protection Agency’s (EPA) Mercury and Air Toxics Standards recently, it set a clear precedent that costs matter and that the EPA does not have a blank check on the wallets of energy consumers. The EPA’s claim that the $10 billion pricetag was “irrelevant” failed to withstand judicial review.
The ruling is not likely to deter the EPA from finalizing its even more costly regulations on carbon emissions from coal plants this summer. Thus, states must be ready to ask the courts to block the implementation of a regulatory scheme that, according to independent economic consultants, will cost energy consumers up to $479 billion, likely the most expensive in the history of the Clean Air Act.
But they will accomplish only a minute reduction of worldwide carbon emissions.
The rules will, however, produce double-digit electric rate increases in Colorado, according to NERA Economic Consulting. Rural Colorado — with mines already facing shutdown because of decisions and policies that push the envelope of climate activism — will suffer economic devastation. Jobs paying average wages and benefits exceeding $122,000 annually will be destroyed.
And Colorado, which at one time ranked second only to Wyoming in the payment of federal coal royalties, will lose an important source of revenue for public schools and governments. Clean coal, which meets 60 percent of the state’s electricity needs, would be displaced by more expensive sources.
The rule fundamentally alters the way that states provide electric power through a series of “outside the fence” measures that the EPA itself lacks authority to implement. These include unrealistic directives to significantly expand the use of renewable energy and natural gas. It is this expansion of federal power, however, that may prove to be the rule’s ultimate undoing. In its mercury rule decision, the Supreme Court challenged the EPA’s claim to deference in the agency’s interpretation of the Clean Air Act. The EPA’s scheme to restructure the nation’s electricity grid through the carbon rules will likely raise additional arguments on the degree to which courts should accept agency interpretations of law.
Thus, it comes as no surprise that more than 30 states have questioned the legal basis for the EPA’s sweeping changes, and many are planning to file suit. Colorado must do the same. We cannot afford to rely on past assurances. Once the rules become final, Colorado must join other states in asking the courts to stop its implementation pending appeal.
The court only acted on the mercury rule after power plants had spent billions on unnecessary controls. The stakes are even higher here. Staying the rules will remove the EPA straitjacket, and avoid saddling Coloradans with higher rates, shuttered plants and a shattered economy.
Stuart Sanderson is president of the Colorado Mining Association.