Will carbon rules hurt economy?

Moderated by Rick Badie

Recent rules announced by the Environmental Protection Agency to fight climate change will require states to develop and implement plans to cut power plant emissions of carbon dioxide. Today, a spokesman for an advocacy organization hails the state-specific pollution rules and say they will improve Georgia’s environment and public health. Meanwhile, two other guest writers predict job losses and higher electricity prices for everyone.

EPA rules boost economy

By Steve Valk

Listening to the reaction to the Environmental Protection Agency’s new rules to limit carbon dioxide pollution at power plants, one might think it’s the end of civilization as we know it: Jobs disappearing, utility bills skyrocketing, old people shivering in the dark.

A quick review of recent history, however, finds such predictions of doom and gloom over EPA regulations never come to pass, and our nation and our economy are all the better for them.

In 1990, the EPA installed a cap-and-trade program to reduce sulfur dioxide emissions that cause acid rain. Critics at the time predicted spikes in electrical rates and economic fallout. Instead, economic growth remained steady, and the cost of electricity declined through the late 1990s. We also stopped poisoning our lakes and killing fish.

Similar pushback came in the 1980s with steps to reduce chlorofluorocarbons in aerosols that were eating up the earth’s protective ozone layer. Again, no economic disaster occurred, and we prevented millions of cancer deaths.

The current hand-wringing over the EPA’s carbon rules is similarly misplaced, especially in Georgia. For starters, the EPA has set the bar relatively low by choosing 2005 as the benchmark year for measuring reductions, since emissions have already fallen 15 percent since then. On top of that, Georgia Power’s recently announced commitment to solar and wind energy, along with nuclear power scheduled to come online, will make it fairly effortless to comply with the standards.

When we reduce CO2 pollution, we also reduce other pollutants that cause health problems. The EPA estimates the proposed rules will annually prevent up to 6,000 deaths and 150,000 asthma attacks by 2030.

What may have critics crying “foul” is that the EPA rules represent an expansion of government. Given the urgent need, however, to reduce the risk posed by global warming, critics cannot demand cancellation of EPA rules without proposing an alternative solution.

The approach favored by a wide array of conservative economists — most recently former Treasury Secretary Hank Paulson — is a carbon tax.

As with carbon regulations, prophecies of economic disaster surround the pricing of carbon: It’s a job killer!

A new study from Regional Economic Models Inc., however, turns that specious assumption on its head. The study looked at a steadily increasing tax on carbon — $10 per ton of CO2, rising $10 a ton each year. By returning all of the revenue from that tax to households in equal shares, it provided an economic stimulus that added 2.1 million jobs in the first 10 years.

Given that the EPA is currently batting 1.000 in the Supreme Court, efforts to block the new carbon rules are destined to fail.

Want to avoid more regulation? Embrace the market-based approach of a carbon tax that gives revenue back to households.

Steve Valk is communications director for Citizens’ Climate Lobby.

Regulation couuld exceed EPA authority

By Tim Echols

When I was a kid, we sang a song in Sunday school about the wise man building his house upon the rock. The second verse was about the foolish man building his house upon the sand. I think the president’s energy policy advisers are building that second house, and their latest efforts will do little more than cost our country billions.

The Environmental Protection Agency recently announced the long-awaited policy on carbon dioxide at existing power plants across the country. I spent a weekend reading and posting on social media the most egregious parts of the document. As an energy official for Georgia, I should advise you to open a new savings account, because this EPA rule is going to hurt.

It is not completely clear the EPA can actually implement a carbon policy. Remember, the president was unable to get his “cap and trade” policy through Congress, and that was all about carbon. I also believe this “reduction” in carbon approach goes well beyond what the Clean Air Act intended, which was originally designed to regulate power plants, not set energy policy.

The EPA rule further erodes state powers and the Georgia Public Service Commission’s responsibility to determine how power is produced. This is not the first time our president has encroached on state sovereignty.

As AJC columnist Kyle Wingfield points out, the rule would create a “perverse” incentive to burn more coal elsewhere, “because absent a ban on exports, American coal will still be mined, shipped overseas in massive quantities, and probably sold at cheaper prices, to countries whose power plants have virtually no regulations on them.”

When you read the 1,640-plus pages of the EPA rule, you will hopefully conclude what I did. This rule is about philosophy, politics and legacy, not science. On page 66, the document states that carbon concentrations “by the end of the century would increase to levels that the Earth has not experienced for millions of years.” We have heard this before.

Before the government enacts another energy rule, why doesn’t it first keep its promise about handling nuclear waste? Nuclear waste is harmful for 10,000 years or more, yet not a single ounce of it has been dealt with properly. We are not allowed to do anything else with it, such as recycling. After we get the waste issue safely resolved, then we can look at other issues.

“Climate talk” is en vogue right now and is receiving unprecedented media coverage. That doesn’t give the EPA the right to exceed its authority. Historically, the EPA has focused on the power plant itself and little else. Until Congress expressly authorizes it to do so, the EPA has no business impacting energy efficiency, solar and even the power plants we get to turn on.

I’m not sure even Congress can rein in this agency at this point in our country’s development. Here’s hoping for a very big wave.

Tim Echols is a commissioner on the Georgia Public Service Commission.

EPA rules will hurt Georgians

By Tom Pyle

 President Barack Obama once promised he would make electricity prices “necessarily skyrocket.” Earlier this month, he delivered on his word. Starting next year, the Environmental Protection Agency will force Georgia’s power plants to cut carbon emissions by 44 percent.

The administrations claims this rule will save the planet and even create jobs, but its real effects will be job losses, higher prices for electricity and everyday goods, and less economic growth. The EPA itself admits it will do almost nothing for the climate — reducing temperatures by a meager 0.02 degrees Celsius by 2100, a long time to wait for something so insignificant.

The environment won’t be better off, but the economy will be ravaged. It is unclear what the actual reductions are in the convoluted rule. One study by the U.S. Chamber of Commerce looks at the impacts of a 42-percent (nationwide) reduction. The EPA says its reduction is smaller.

Either way, in Georgia, there will be a mandatory 44-percent reduction in carbon dioxide emissions, which brings it close to the chamber’s estimates.

Georgia generates 37 percent of its electricity from coal. To meet the 44-percent goal, the state will have to close low-cost power plants and force utilities to purchase electricity from new, more expensive sources.

This also affects small businesses. When employers pay more for energy, they have less money to spend on employees. With the EPA rule, the chamber estimates Georgia and its immediate neighbors could lose up to 59,700 jobs a year.

Higher costs and fewer jobs mean less wealth for the middle class. Over the next decade, the EPA rules will annually eliminate as much as $10.5 billion in new wealth in the south Atlantic region. Nationally, the country could be $50 billion poorer every year.

The EPA’s and the president’s lack of transparency on this question mean the effects could be even worse. But it is undeniable the EPA rule will mean less income, fewer jobs and less wealth for Georgians. And it is equally undeniable that your pain will not be the climate’s gain.

Remember that the next time Obama or any other politician claims they’re saving the world and protecting our children. This is as false as, “If you like your health care plan, you can keep it.” The EPA regulations are a war on middle-class jobs, the economy and affordable energy. No matter what you call it, Georgians will be the casualties.

Tom Pyle is the president of the American Energy Alliance.

 

 


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