Denying the costs of coal regulation
In a recent Facebook interview, EPA Administrator Gina McCarthy acknowledged the obvious—that she supports the Environmental Left’s “Keep it in the Ground” policy. In an online “Mashable” discussion with science editor Andrew Freedman, McCarthy said of anti-coal activists, “I think we share the same goal.” She also admitted that the economies of coal states are “in trouble,” and even allowed that EPA’s regulations “steepen the curve” of their decline.
But like a Formula One driver veering from a collision, McCarthy quickly dodged responsibility for this “trouble” by blaming market competition. “Frankly, the coal industry has been going downhill since the 1980s,” she told Mashable.
This is nonsense. Coal production rose steadily from 1980 until 2009. Production in 1980 was 830 million tons and in 2008 it was 1.2 billion tons. Coal employment climbed from 2000 through 2011, reaching a level not seen since 1994. And so, before the Obama Administration decided to destroy it, coal’s share of the nation’s power generation market hit 51 percent—higher by far than competing fuels. Coal also broke records for exports and drove increasing high-wage employment, supporting hundreds of thousands of jobs paying an average of $84,000 per year with great benefits.
But beginning with a “MATS rule” in 2011, coal lost half of its entire power generating fleet — sparking a gradual decline in market share that soon accelerated, thanks to a regulatory barrage capped by the Clean Power Plan. In fact, the Energy Information Administration estimates the CPP will shut down another 56 coal plants nationwide. McCarthy and others might point a finger at the market impact of expanding natural gas production, but a recent study by the King University business school showed that natural gas had only a modest effect on coal production. That analysis found EPA regulations actually destroyed five times as much coal demand. And, a Duke University study concluded that less than 10 percent of America’s coal fleet was threatened by natural gas before EPA’s regulations kicked in.
In exchange for leaving the nation with a less diverse energy supply, and global CO2 levels that will remain virtually unchanged, EPA’s climate regulations have contributed to the loss of 68,000 jobs in coal communities — with more layoffs to come. The resulting “trouble” is serious enough that McCarthy’s own administration has proposed a $3 billion aid package to repair the damage. Presidential candidate Hillary Clinton believes the damage merits $30 billion in federal aid.
In short, coal’s distress is not the result of market competition. The MATS rule, the Clean Power Plan, renewable fuel standards, New Source Performance Standards, the retroactive vetoes of mining permits, hefty federal subsidies for competing fuels — none of these is the result of “market conditions.” They are government decisions.
Coincidentally, the same week that McCarthy was denying the cost of her regulations, a federal judge sought to clarify them. In a summary judgement against EPA, Judge John Preston Bailey berated EPA for ignoring its legal obligation to weigh regulatory costs. “EPA cannot redefine statutes to avoid complying with them,” he said. “Nor can EPA render them superfluous or contrary to their original purpose by simply defining them to be.”
Not to be outdone, McCarthy has claimed that she can’t find “one single bit of evidence” of job losses stemming from her climate change regulations. Maybe she hasn’t bothered to look.
Point is, if we’re going to agree on enduring environmental solutions, we need an honest discussion about the costs as well as the science. And that begins by acknowledging the importance of advanced technologies that can make coal cleaner, rather than poorly designed and costly federal measures. It’s time let America’s engineers find climate solutions, not Washington’s regulators.
Luke Popovich is a spokesman for the National Mining Association.