EPA Regulations: A Step in the wrong direction

Lance Brown Contributor
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Despite the many energy plans proposed over the past year—ranging from carbon caps to renewable energy standards to gas taxes—it seems unlikely that an energy bill will be passed this year. Majority Leader Harry Reid (D-NV) put the climate bill on hold until September, and by all accounts it will be nearly impossible to pass a comprehensive bill. Congress has realized that proposals like cap-and-trade or a federal renewable energy standard will not adequately address our country’s energy problems and will do more harm than good to the economy.

Congress is taking a step in the right direction.

However, any step in the right direction could be undermined by the Environmental Protection Agency’s (EPA) regulations, which will be extremely detrimental to energy costs, jobs, and the economy. We may have avoided costly and unwieldy energy legislation (for now), but the EPA regulations could prove to be even more costly and unwieldy.

Given the evidence so far, it’s clear that the EPA’s plans are a step in the wrong direction for our energy future and the economy.

In January, the EPA released its endangerment finding that greenhouse gases have a “dangerous” impact on the health of Americans, but it appears that the regulations will have an even more dangerous impact on the health of the economy.

The EPA plans to regulate a number of sources, ranging from power plants to community institutions like farms, schools, and hospitals. By July 2011, the EPA would start regulating large emitters, such as coal plants, refineries, and cement manufacturers. By 2016, would start regulating smaller sources of emissions.

These regulations will have a severe impact on the economy. According to a Reason article by Jonathan Adler, “a permit for a new or modified source can cost hundreds of thousands of dollars for the applicant.” It’s clear that many businesses could go bankrupt in attempt to comply with the regulations, taking needed jobs with them. In addition, entire industries could go bankrupt, too—such as the Portland Cement Association, who said compliance with the EPA’s proposed mercury and other particle standards will cost “several billion dollars.”

These companies will pay the compliance costs if they need too—but they’ll raise prices and cut jobs, too.

The EPA’s regulations will have an equally severe impact on consumers. As companies face exorbitant compliance costs and/or close, prices will rise on everything from energy bills, to vehicles (as much as $1,000 per vehicle) to cement, which the cement producers say will need to be imported at higher costs.

We may be shifting away from Congress’s misguided plans for carbon caps and federal renewable energy standards, but we’re moving toward an even larger “train wreck” for the economy, to use the words of Sen. Lisa Murkowski (R-AK).

As the EPA regulations debate begins, I urge Congress to continue to seek solutions to our energy problems that don’t bankrupt businesses and consumers. We have so many unique sources of energy in our unique states, so it should be possible to find a solution that is affordable, reliable, and clean, too. If Sen. John D. Rockefeller’s (D-WV) bill to stop the EPA’s regulations comes up for a vote, I urge the Senate to support it so they can get back to work on finding a real energy solution.

Furthermore, I urge the EPA to take care that they don’t destroy our already struggling economy, just as we are beginning to see the light at the end of the recession’s tunnel.

Lance Brown is the Executive Director of PACE.