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How Obama-Era Regulations Are Shutting Down Perfectly Good Power Plants

February 15, 2018

Coal has been a mainstay of economic growth and human well-being in the United States for more than a century.

Coal Power Station

Coal powered the Industrial Revolution and enabled the United States to electrify in the twentieth century, creating the most successful economy in human history.

Even today—135 years after the first coal-fired central power station was built in New York City—coal supplies roughly one-third of the electricity generated in the United States. But coal’s future appears uncertain. Competition from low-cost natural gas, rules imposed on coal-fired power plants by the Obama administration, and subsidies to renewable energy have forced into retirement hundreds of coal-fired power plants around the nation.

We refer to Obama-era rules and subsidies as zombie regulations: “undead” legacies of President Barack Obama’s war on coal that was ended by President Donald Trump. The legal and scientific basis of these zombie regulations was the “Endangerment Finding” issued in 2009 by the Environmental Protection Agency (EPA).

The Endangerment Finding asserted that increasing concentrations in the atmosphere of several greenhouse gases, primarily carbon dioxide, “[t]hreaten the public health and welfare of current and future generations,” and therefore those gases must be regulated under the Clean Air Act.

The Endangerment Finding was the basis for all Obama-era regulations on greenhouse gases, and it is a shaky foundation. The evidence used to justify the Endangerment Finding is weak, and global warming predictions based on that evidence have not been supported by temperature observations over the past 10 years.

In addition to imposing regulations on greenhouse gas emissions from power plants, the Obama administration promulgated more stringent regulations on traditional pollutants. The imposition of these regulations made operating coal-fired power plants more expensive, in some cases prohibitively so, by forcing owners of older power plants to install costly pollution control equipment. EPA unilaterally rewrote the Clean Air Act: Existing power plants had been statutorily exempted from emission control requirements imposed on so-called “new sources.” The Trump administration is repealing and rolling back some of these unnecessary and destructive regulations.

This Policy Study, the second in a series, offers in Part 1 a brief overview of the “war on coal” and the damage done by the Obama-era zombie regulations. Part 2 discusses two of those regulations in more depth: the Clean Power Plan and the addition of carbon dioxide to New Source Performance standards for new power plants. It then explains why the Endangerment Finding should be rescinded.

Part 3 addresses seven zombie regulations unrelated to carbon dioxide that are adversely affecting coal-fired plants: Mercury and Air Toxics Standards, New Source Review Standards, Cross-State Air Pollution Rule, Coal Combustion Residuals Rule, Effluent Limitations Guidelines, National Ambient Air Quality Standards for Ozone, and the Stream Protection Rule.

Part 4 describes how the Trump administration has begun the process of replacing Obama-era zombie regulations with policies based on real science and sound economics. It also provides concluding observations. An appendix shows coal-fired power plant retirements expected between 2016 and 2021.

NOTE: This Policy Study is the second in a four-part series. Read the first, third, and fourth parts.

Author
Isaac Orr is a policy fellow at the Center of the American Experiment on mining and energy issues and a policy advisor for The Heartland Institute.
isaac.orr@americanexperiment.org @thefrackingguy
Author
Frederick D. Palmer is a policy advisor for energy and climate at The Heartland Institute.
fpalmer@heartland.org