The Illogic of EPA Carbon Regulations

The Obama administration continues its push to drive up energy prices.

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Daniel Simmons is the director of state affairs at the Institute for Energy Research.

President Obama is getting what he hoped for in 2008—higher energy prices. By having his Environmental Protection Agency, known as the EPA, implement regulations that contribute to higher energy prices through new burdens on power plants, the agency is now effectively responsible for numerous plant closures and the cancellation of new power plants across the country. Of course, the agency claimed its rules would not impact the development of new power plants, and yet here we are. This week, plans to build an 850-megawatt plant in Georgia were scrapped because of the EPA's proposed greenhouse gas rule.

In 2008, President Obama uttered his now infamous statement that, "Under my plan of a cap-and-trade system, electricity rates would necessarily skyrocket." He worked with many in Congress to pass a carbon dioxide cap-and-trade bill (also referred to as "cap-and-tax") but failed. After cap-and-trade proponents lost control of the House of Representatives in the last election, he remained unrepentant about working to increase the price of electricity. "Cap-and-trade was just one way of skinning the cat," he said at a press conference two days after the election. And he is still working to increase the price of electricity.

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One of the means of "skinning the cat" is the EPA's new regulation that essentially bans new coal-fired power plants. Coal-fired power plants generate some of the lowest-cost electricity currently produced as attested by the fact that coal produces the largest share of electricity in eight of the 15 states with the lowest electricity prices. But this will not continue into the future because EPA regulation bans new coal plants unless a power plant can halve its carbon dioxide emissions. The problem is that the technology is not commercially available to cost-effectively capture carbon dioxide emissions, and the agency says the rule won't reduce carbon dioxide!

But the worst part of the regulation is its dishonesty. The EPA claims the rule has no costs—because it has no benefits. In other words, the agency is arguing that power companies would not build new coal-fired power plants and therefore there is no cost to this rule. But the EPA cannot possibly believe this. If they did, why would they waste their time or taxpayer money on a regulation banning something that would not be built?

The EPA's justification of this rule is also faulty. The agency claims it is regulating carbon dioxide because of global warming. But if global warming is a problem that the EPA needs to address, why does the agency spend its time on a regulation it says will not impact carbon dioxide emissions?

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The EPA says that greenhouse gases "endanger public health and public welfare." If greenhouse gases such as carbon dioxide "endanger public health and welfare" shouldn't the EPA do something about it? Should the agency work to actually reduce the danger? Isn't that the point of regulation—to reduce some of the alleged harm?

But the EPA isn't reducing any danger here because according to the agency (here on Page 49), "This proposed rule also will not have a direct impact on U.S. emissions of greenhouse gases under expected economic conditions."

If global warming is a problem that the EPA needs to address, then why are they working on imposing rules that the agency admits "will not have [a] direct impact of U.S. emissions of greenhouse gases?" It's tough to see how EPA regulation makes logical sense. Does the EPA not really care about global warming or are they working to end America's use of coal? Does the EPA only want to increase the price of energy by making it harder to build low-cost electricity generation? What explains the EPA's actions? And why are taxpayers paying for this nonsense?

The only thing we know for sure is that the EPA claims that global warming is a problem and then announces rules that the agency admits does nothing about it. Draw your own conclusions.

  • Read: Lisa Jackson's EPA Goes Rogue
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