Monday, June 4, 2012
Washington, D.C. – This evening, Senator James Inhofe (R-Okla.), Ranking Member of the Senate Committee on Environment and Public Works, gave a speech on the Senate floor highlighting a new video of Environmental Protection Agency (EPA) Region 1 Administrator Curt Spalding admitting that due to EPA’s barrage of rules, “if you want to build a coal plant you got a big problem.” Administrator Spalding goes on to explain that the decision to kill coal was painful “because you got to remember that if you go to West Virginia, Pennsylvania, and all those places, you have coal communities who depend on coal. And to say that we just think those communities should just go away, we can’t do that. But [Administrator Jackson] had to do what the law and policy suggested. And it’s painful. It’s painful every step of the way.”
This new video is the second in a series revealing the truth about the Obama-EPA’s extreme agenda to kill fossil fuels. It follows a video Senator Inhofe highlighted in April, which showed former EPA Region 6 Administrator admitting that EPA’s “general philosophy” is to “crucify” and “make examples” of oil and gas companies.
Tonight on the Senate floor, Senator Inhofe urged his colleagues to join him in the effort to stop President Obama’s war on fossil fuels and affordable energy. In the next two weeks, the Senate will vote on a resolution by Senator Inhofe that requires a simple majority of those voting and present; this resolution would overturn the Obama EPA’s Utility MACT rule, which is specifically designed to shut down coal plants across the country. It would send EPA back to the drawing board to craft a rule that balances environmental protection and economic growth, instead of killing coal in American electricity generation.
Remarks as Prepared for Delivery
Utility MACT Resolution: Stopping President Obama’s War on Coal
Mr. President, this month, the United States Senate will have the opportunity to put a stop to the second most expensive EPA regulation in history – a rule known as Utility MACT. Let me tell you what Utility MACT is. That’s what the Obama-EPA calls it so people won’t know what it is and how much it costs. It is the first step to kill coal in the United States. Right now 50% of our electricity comes from coal, so you can imagine what will happen to your energy costs as well as millions of lost jobs. I have introduced a resolution to kill it. By voting for my resolution, SJR 37, members of the Senate can prevent the Obama EPA from causing so much economic pain for American families. It requires only a majority vote in the Senate and House and then would have to be signed by the President. I don’t believe President Obama would veto it right before an election.
Utility MACT is the centerpiece of President Obama’s effort to kill coal: Utility MACT is specifically designed to close down existing plants, while the Obama-EPA’s greenhouse gas regulations are specifically designed to prevent any new coal plants from being built.
The goal behind these policies is not surprising. But what is surprising is that while President Obama goes around pretending to be for an “all-of-the-above” approach on energy, members of his green team administration just can’t help but tell us the truth about what’s really going on at EPA.
Mr. President, you may remember that several weeks ago I came to the Senate floor to bring attention to a video of EPA Region 6 Administrator Al Armendariz admitting that EPA’s “general philosophy” is to “crucify” and “make examples” of oil and gas companies. Today, I would like to highlight another video. It’s a video of EPA Region 1 Administrator Curt Spalding admitting that the Obama EPA consciously and deliberately made the choice to wage a war on coal. Now, I’m going to quote exactly what he said so everyone can have the full effect. He said,
“But know right now, we are, we are struggling. We are struggling because we are trying to do our jobs. Lisa Jackson has put forth a very powerful message to the country. Just two days ago, the decision on greenhouse gas performance standard and saying basically gas plants are the performance standard which means if you want to build a coal plant you got a big problem. That was a huge decision. You can’t imagine how tough that was. Because you got to remember that if you go to West Virginia, Pennsylvania, and all those places, you have coal communities who depend on coal. And to say that we just think those communities should just go away, we can’t do that. But she had to do what the law and policy suggested. And it’s painful. It’s painful every step of the way.”
Let me repeat the key part of Administrator Spalding’s quote just for emphasis – he said: “if you want to build a coal plant you got a big problem.” Even more stunning, he’s admitting that the Obama EPA’s decision to kill coal was “painful every step of the way” because West Virginia, Pennsylvania, and all the coal states depend on coal development for their jobs and livelihoods – but that they’re just going to kill coal anyway. Trust me, Administrator Spalding and President Obama, it’s far more painful for those who will lose their jobs and have to pay skyrocketing electricity prices, than for you.
Spalding’s statement that “if you want to build a coal plant you got a big problem” reminds us a lot of President Obama’s own statement about coal in 2008 when he wasn’t so afraid to explain his real intentions. Remember he said, “if somebody wants to build a coal-powered plant, they can. It’s just that it will bankrupt them.”
Of course, this war on coal comes from the same administration that put the “crucify them” Administrator Al Armendariz in charge of the biggest oil and gas producing region of the country. In fact, EPA’s crucifixion philosophy is so obvious now that even the left leaning Washington Post said that the Obama EPA is “earning a reputation for abuse.” But I think Kim Strassel of the Wall Street Journal put it best when she said that Armendariz was “a perfect general for Mr. Obama’s war against natural gas” and “on the front lines” of President Obama’s battle to end fossil fuels and affordable energy.
As this most recent video of Region 1 Administrator Spalding confirms, there are plenty of green generals like Armendariz going into battle for the Obama EPA. We have several more videos of EPA officials making similar statements, but I will talk about those at a later date, because today I would like to focus my remarks specifically on President Obama’s war on coal and what members of this body will choose to do about it.
The fundamental question before the United States Senate will be whether my colleagues will have the courage to stand up to President Obama and put the brakes on his abusive, out of control EPA that has openly admitted that “if you want to build a coal plant you got a big problem” – or if they are going to stand with President Obama and his administration’s “crucify” agenda.
War on Coal
One of the most interesting and telling aspects of President Obama’s disingenuous attempt to rebrand himself as a supporter of fossil fuels is that he never mentions coal. He doesn’t even pretend.
In fact, up until very recently President Obama’s campaign website had a section devoted to the President’s goals for every energy resource except coal. Only after facing intense criticism, and disappointing primary results in coal states, the Obama campaign attempted quietly to add a “clean coal” section to its site.
Well, apparently President Obama’s definition of “clean coal” is no coal. In his 2013 budget request, the President cut funding for coal research and development at the National Energy Technology Laboratory (NETL) by nearly 30 percent. This is at the same time EPA has proposed greenhouse gas standards for coal-fired power plants that require Carbon Capture and Sequestration (CCS) – a technology that is not ready to operate on a commercial scale. So on the one hand we have Obama issuing standards in which utilities can’t comply without using CCS. On the other, we have him handicapping that very technology.
After cap-and-trade was thoroughly rejected by the American people and defeated in a Democrat controlled congress, President Obama promised that he wouldn’t give up in his efforts to stop coal development. He also said “Cap-and-trade was just one way of skinning the cat. It was a means, not an end. I’m going to be looking for other means to address this problem.”
And he has found other ways to skin the cat – by imposing regulations that have exactly the same effect of killing coal. I don’t have time to go into every action EPA is taking but I would like to highlight a few of their key coal-killing regulations.
Front and center, of course, is the Utility MACT rule, a rule with such strict standards, they cannot be met, which means that, along with EPA’s other air rules, up to 20% of America’s coal fired capacity will be shuttered and around 1.6 million jobs will be lost. Utility MACT’s price tag is second only to the Obama EPA’s greenhouse gas regulations which are designed to prevent any new coal plants from being built in this country. Like the Waxman-Markey cap-and-trade bill, these regulations will cost $300 to $400 billion dollars a year and destroy over two million jobs. It may even cost more if the courts throw out EPA’s “tailoring rule” – a rule that EPA is attempting to create to subvert the law in order to avoid the “absurd results” that would ensue if the agency regulates greenhouse gases under the thresholds required by the Clean Air Act. That means every church, every school, every restaurant and coffee shop, will have to be regulated or put out of business by the EPA.
EPA is also waging this war on the permitting front, and this is a problem that we’ve been tracking for a long time. As my EPW Minority Report from January 2010 showed, EPA at that time was obstructing 190 coal mining permits, putting nearly 18,000 jobs at risk. And not much has improved since then.
Last November a report by the Office of Inspector General that I requested confirmed that EPA, through its own actions, has been deliberately and systematically slowing the pace of permit evaluations for new plants in Appalachia. These findings were concerning enough that Inspector General did a follow up review – and again, in February of this year, OIG found that EPA did not have a consistent, official recordkeeping system, which was exacerbating permit delays.
Not only is EPA continuing to stall the permitting process, they are trying to stop permits that have already been granted. In January 2011 EPA took the drastic and unprecedented step of revoking a lawfully issued mining permit that the Bush Army Corps of Engineers had granted to the Spruce Mine project in Appalachia. Fortunately, the courts recognized EPA overreach in this case. March 23, 2012 the U.S. District Court ruled that EPA exceed its authority – and as the Judge said, EPA’s claim that it can veto a permit already issued by the Army Corps of Engineers is a “stunning power for an agency to arrogate to itself.”
States Are Weighing In
After four years of this aggressive barrage of rules designed to kill coal, many in the heartland, states that rely most heavily on coal, are not amused.
Just last month, 24 state attorneys general, including one quarter of all Democratic state attorneys general, filed suit to overturn Utility MACT because of the devastating effects it will have on jobs and their states’ economies; these are Democrats from Arkansas, Kentucky, Mississippi, Missouri, West Virginia, and Wyoming. In other words, it appears that Democrat AG’s from several states are trying to save coal, while the Democratic Senators from these same states are carrying out President Obama’s war on coal.
Let’s take a look at what’s happening in West Virginia. The state government just sponsored a three-day forum last week on “EPA’s War on Coal.” Larry Puccio, the Democrat Party Chairman in West Virginia said, “A lot of folks here have real frustration with this administration’s stance on coal and energy.” Also recently, on a West Virginia radio show, Cecil Roberts, president of the United Mine Workers of America famously said that EPA Administrator Lisa Jackson “shot [the coal industry] in Washington” just as the Navy SEALs shot bin Laden. As Roberts expanded, “We’ve been placed in a horrendous position here. How do you take coal miners’ money and say let’s use it politically to support someone whose EPA has pretty much said, ‘You’re done’?”And let’s not forget that West Virginia is the state where President Obama lost several counties to a convicted felon in the primaries.
Workers in Kentucky are also weighing in. As Politico Pro reported, President Obama lost to an “uncommitted” vote in 38 counties representing the Kentucky Coal Coalition and won just 44 percent of over 49,000 votes; he only carried 14 of the 38 coal counties; and overall carried the state as a whole with just 58 percent of the vote. In Arkansas, President Obama won the primary with less than 60 percent of the vote. In Ohio it’s the same story. When Vice President Biden visited that state recently he was faced with over 100 workers who will lose their jobs because of this administration’s aggressive regulatory regime. Their message to the Obama administration: “stop the war on coal.”
These states have good reason to be concerned. Let’s take a look at how Utility MACT will impact some of the most coal dependent states.
– ARKANSAS – 40% of electricity; $70 million in annual payroll
– LOUISIANA – 9th cheapest electricity; $100 million in payroll
– MICHIGAN – 60% of electricity; 10th in coal use
– MISSOURI -80% of electricity; 6th in coal use
– MONTANA -60% of its electricity; 5th in coal production
– NORTH DAKOTA – 85% of electricity; 9th in coal production
– OHIO -85% of its electricity; more than 19,000 jobs
– PENNSYLVANIA – 52% of electricity; 5th in coal use
– TENNESSEE – 62% of electricity; $220 million in annual payroll
– VIRGINIA – more than 31,000 jobs; 13th in coal production
– WEST VIRGINIA – 2nd in coal production; more than 80,000 jobs
These are real jobs that will be lost state by state.
Utility MACT: Electricity Prices will “Necessarily Skyrocket”; Jobs will be lost
Now I would like to take a moment to go into detail about why Utility MACT would be so devastating. Just to put this rule in perspective, even Democrat Representative John Dingell, author of the Clean Air Act amendments, said Utility MACT is “unparalleled in its size and scope” and it “presents a set of new regulations with possible wide-reaching impacts on the way our country generates and consumes electricity.”
Utility MACT has an unprecedented price tag – EPA puts the cost of their rule at nearly $10 billion a year, while other sources project it will cost even more, making it the second most expensive rule in the Agency’s history. This is second only to global warming cap and trade, which would be $300-400 billion tax increase. Can you believe it? This tax increase would cost the average family that pays federal income taxes over $3,000 each year. Now Utility MACT would tax each family over and the above cap-and-trade tax. Further, the rule will shutter 20 percent of America’s coal-fired power capacity; this will inevitably result in higher electricity prices for every American.
It’s not just me saying this. As the Chicago Tribune reported on May 18, in 2015 “electric bills are set to be about $130 more than they are now.” It went on to say that prices have already significantly risen in the heartland. To quote this article again, “Prices were higher in northern Ohio and the Mid-Atlantic region, at $357 per megawatt and $167 per megawatt respectively.”
Now let’s look at jobs: Utility MACT and other EPA regulations on the electric power sector have resulted in over 24,000 megawatts of announced power plant retirements located in 20 states. According to the National Economic Research Associates, Utility MACT will destroy 180,000 to 215,000 jobs in 2015. And with other, new EPA regulations on the electric power sector, the economy stands to lose approximately 1.65 million jobs by 2020.
Manufacturers will be particularly hard hit due to their reliance on low cost electricity and because of their dependence on natural gas as a raw material, as both electricity rates and natural gas prices increase. According to Nucor steel, a 1 cent increase in electricity rates costs the firm $120 million. These extra costs could endanger a million manufacturing jobs outside of the coal and utility industries. Utility MACT will also have a negative ripple effect. Just to bring up one example, in Avon Lake, Ohio, the closure of the local GenOn power plant will cost the school system 11% of its budget annually. Besides the 80 high-quality jobs lost at the plant and many indirect jobs lost in the community, the city will have fewer resources for its paramedic and firefighting services. This story will be replicated at communities across the country.
The Natural Gas Myth
It’s not surprising that instead of taking credit for the dire results of this coal-killing agenda in an election year, the Obama administration is claiming that lower natural gas prices are the reason utilities are switching from coal to natural gas.
But there’s one major problem: while President Obama poses in front of pipelines in Oklahoma, pretending to be a friend of oil and natural gas, he has given marching orders to his administration to do everything possible to end hydraulic fracturing. Remember, as I mentioned earlier, Armendariz was the one who was caught on tape admitting the EPA’s “general philosophy” is to “crucify” and “make examples” of oil and gas companies, specifically targeting hydraulic fracturing.
If the crucifixion scandal isn’t enough of a revelation of this war on natural gas, remember that the Sierra Club – which recently gave the President its most enthusiastic endorsement – has just rolled out its newest campaign: “Beyond Gas,” a spin-off of its decade-old “Beyond Coal” campaign to phase out coal-fired power plants. As Sierra Club Executive Director Michael Brune explained “As we push to retire coal plants, we’re going to work to make sure we’re not simultaneously switching to natural-gas infrastructure. And we’re going to be preventing new gas plants from being built wherever we can.”
So natural gas supplies may be plentiful now, but the Obama Administration’s “crucify them” agenda on oil and gas development is designed to change that. Its whole purpose is to decrease access to these resources through increased regulations from the federal government.
Now I’d like to address one more myth that’s being perpetrated by Utility MACT proponents, which has to do with their public health argument. The truth is that the health benefits EPA claims are exaggerated and misleading. That’s because EPA’s analysis shows that over 99 percent of the benefits from the rule come from reducing fine particulate matter, not air toxics. Of course, fine particulate matter is regulated under the National Ambient Air Quality Standards program, and in fact 90% of Utility MACT’s purported particulate matter benefits occur in air already deemed safe in the NAAQS program.
Not only is EPA double miscounting benefits, it is also dismally failing the cost/benefit test. The agency itself admits that Utility MACT will cost an unprecedented $10 billion to implement – and it also admits that the $10 billion in costs will yield a mere $6 million in direct benefits. That means that EPA’s best case scenario yields a ludicrous cost/benefit ratio of 1600 to one.
In reality, Utility MACT will harm the public by increasing unemployment, a well-established risk factor for elevated illness and mortality rates. In addition to influences on mental disorder, suicide and alcoholism, unemployment is also a risk factor in cardiovascular disease and overall decreases in life expectancy. Further, higher electricity bills act like a regressive tax, hurting the poor and elderly the most by diverting funds from living expenses such as food, rent and medical care to pay for more expensive electricity. To be sure, those who won’t feel any of this economic pain are President Obama’s Hollywood elites.
Republicans the First to Introduce Mercury Reduction Legislation
I know what my environmentalist friends are saying: they’re already accusing me of allowing mercury going into the air – so today I would like to remind them that it was Republicans who first put forth a real plan to reduce mercury emissions from power plants.
In 2003 and 2005, I was working to pass the Clear Skies bill, which was the most aggressive initiative in history to reduce emissions of sulfur dioxide, nitrogen oxides, and mercury – in fact, this bill would have reduced mercury emissions by 70% by 2018. So in just 6 years from now, we would already have had a 70% reduction. It was a plan that would have improved our air by reducing utility emissions faster, cheaper, and more efficiently than the Clean Air Act as it still stands today. And it would have done all this without harming jobs.
So why did Clear Skies fail? In 2005, then Senator Obama served with me on the Senate Committee on Environment and Public Works, and it was his vote that killed the bill. As Senator Obama himself admitted, “I voted against the Clear Skies bill. In fact I was the deciding vote despite the fact that I’m a coal state and that half of my state thought I’d thoroughly betrayed them because I thought clean air was critical and global warming was critical.”
Clear Skies apparently didn’t cause enough economic pain. It reduced real pollutants; it didn’t address President Obama’s pet cause of climate change. It did not achieve the goal they really want to impose: ending coal. So now instead of having a reasonable and effective mercury reduction plan already in place and working for the American people, President Obama wants to implement EPA’s Utility MACT rule in order to kill coal.
We Still Need Coal
The bottom line is that we still need coal, and all those who dream of doing away with it will not be able to escape the reality that coal will continue to provide much of our electricity for the foreseeable future. So we need to be implementing policies that improve air quality without destroying coal and millions of good American jobs, and imposing skyrocketing electricity costs on every American.
That’s why my Resolution to stop Utility MACT is so crucial. Contrary to what my critics are saying, this resolution does not prevent EPA from regulating mercury under the Clean Air Act – it simply requires EPA to go back to the drawing board to craft a rule in which utilities can actually comply; a rule that does not threaten to end the coal in American electricity generation but helps utilities reduce emissions without having to shut their doors.
Before I end, I’d like to add that in the fight to hold EPA accountable and stop the regulatory onslaught, no one has been a stronger legislative partner than Congressman Fred Upton. As the Chairman of the House Energy and Commerce Committee, he’s on the front lines each and every day scrutinizing the EPA’s actions and advancing legislation to keep the agency in check. Fred and I partnered up in the opening weeks of the 112th Congress to introduce the Energy Tax Prevention Act, a bill that would stop EPA in its tracks in the misguided effort to transform the Clean Air Act into a greenhouse gas regulatory tool. We’ve continued to work closely together, and I believe our work has not only put EPA on notice that Congress won’t stand for its overreach, I also believe we’ve made a real difference in forcing them to stand down on issues like the ozone reconsideration. The House recently passed bipartisan legislation to rein in Utility MACT with 19 Democrats supporting the measure, so now it’s time for the Senate to act.
I’d like to remind my colleagues that this resolution will likely be the vote on coal for the year so this is our one chance. Many of my Democrat colleagues have gone on record saying they want to rein in the Obama-EPA. The senior Senator from Missouri is one of them: she said back home that she is determined to “hold the line on the EPA.” Does that mean she, and other Senate Democrats who have made similar statements, will vote to stop the centerpiece of Obama’s war on coal?
Today I have talked a lot about Utility MACT. Let’s be sure we understand what it means one more time. Utility MACT is a rule by the EPA to end coal in America and cause electricity rates to skyrocket. My resolution, SJR 37, will allow the elected members of the Senate to stop the Obama-EPA. It is as simple as that.
The vote on my resolution will clearly demonstrate to the American people which Senators will “hold the line” and stand with their constituents for jobs and affordable energy, and which Senators want to kill coal in favor of President Obama’s radical global warming agenda that will be devastating to people in their states.
To borrow a phrase from Administrator Spalding, to choose latter will be painful, “painful every step of the way” for their constituents. I hope they make the right choice. With that Mr. President, I yield the floor.