Industry-backed report says EPA climate rule to cost $366B
10/16/14 12:57 PM EDT
A study commissioned by the coal industry and other business groups found that the Environmental Protection Agency’s (EPA) carbon rule for power plants could cost at least $366 billion.
The analysis, written by Nera Economic Consulting, said that people in 43 states would see double-digit percentage increases in their electricity bills, with at least 20 percent increases in 14 states.
Meanwhile, the carbon dioxide reductions would only limit global warming by 0.02 degrees and sea level rises by 0.01 inch, researchers said.
“This analysis is further confirmation that it would be irresponsible for any state to implement EPA’s costly power plan,” Hal Quinn, president of the National Mining Association, said in a statement. “Asking Americans to pay more in return for less energy and fewer jobs is not a plan that provides them the economic security they deserve.”
Mike Duncan, president of the American Coalition for Clean Coal Electricity, said the analysis shows major problems with the proposed rule.
“I have one thing to say to the president — pull this rule before irrevocable consequences hit American people and businesses,” he said.
“EPA’s proposal creates major questions about the reliability and affordability of electricity across the country while not doing much to address the problem it seeks to solve,” said the American Farm Bureau Federation.
Those three groups commissioned the study, along with American Fuel & Petrochemical Manufacturers, the Association of American Railroads, the Electric Reliability Coordinating Council and the Consumer Energy Alliance.
Nera concluded that the EPA’s rule would cost consumers and businesses $41 billion or more a year, nearly five times the costs of all Clean Air Act rules for power plants prior to 2010.
Much of that cost comes from consumers paying more than $500 billion to reduce energy use.
Nera said the proposed rule would close 45,000 megawatts of coal-fired power generation capacity, which is more than New England’s entire capacity.
The EPA maintains that its rule’s benefits would outweigh its costs.
“These benefits far outweigh the costs in terms of our health and our analysis shows that bills will decrease because we’ll be using energy more efficiently,” spokeswoman Liz Purchia said.
Purchia accused the industry of inflating the costs of past EPA rules, and said that history makes it clear that the benefits have exceeded costs.
“This is the same tired rhetoric we’ve heard for decades. We heard it about phasing out leaded gasoline, we heard it about acid rain, and we heard it about the ozone layer,” she said.
According to the agency’s analysis, compliance would cost $7.3 billion to $8.8 billion annually, much less than Nera said. It would increase electricity costs slightly, but new energy efficiency gains would save consumers money by the 2030 compliance deadline.
Among the benefits of the rule would be between $55 billion and $93 billion in public health improvements, the EPA said.
Source: The Hill
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