Setting the Record Straight on Mercury and Air Toxics Standards

Dear Journalist,

As you know, EPA today unveiled its final rules for emissions of mercury and air toxics from power plants, known as utility maximum achievable control technology, or Utility MACT.  An opponent of the ruling, lobbyist Scott Segal of Bracewell & Giuliani, released a set of talking points about the new rule this morning. The policy experts at Environmental Defense Fund would like to set the record straight.

Segal:   "Utility MACT will undermine job creation in the United States in several different ways.  It will result in retirement of a significant number of power plants and either fail to replace that capacity or replace it with less labor-intensive forms of generation.  It will increase the cost of power, undermining the international competitiveness of almost two dozen manufacturing industries, and it will reduce employment upstream in the mining sectors.  All told, it is anticipated that the rule will result in the loss of some 1.44 million jobs by 2020.  While some jobs are created by complying with the new rule, the number and quality of those jobs is far less than those destroyed.  We estimate that for every one temporary job created, four higher-paying permanent jobs are lost.  The bottom line:  this rule is the most expensive air rule that EPA has ever proposed in terms of direct costs.  It is certainly the most extensive intervention into the power market and job market that EPA has ever attempted to implement."

EDF Response: Segal's doomsday numbers simply do not hold water. A report from the Economic Policy Institute http://www.epi.org/publication/a_life_saver_not_a_job_killer/

examined the employment impacts of the Mercury and Air Toxics rule, finding that it would have a positive net impact on overall employment, likely leading to the creation of 28,000 to 158,000 jobs between now and 2015.  As Josh Bivens of the EPI recently pointed out in his testimony to the U.S. House of Representatives, “. . . calls to delay implementation of the rule based on vague appeals to wider economic weakness have the case entirely backward – there is no better time than now, from a job-creation perspective, to move forward with these rules.”

Segal:  "Most of the benefits EPA claims to the rule come from reducing soot emissions.  But EPA also is on the record saying that most of these soot benefits come in areas already achieving the Agency’s prescribed standards for soot.  EPA has said that soot emissions in those areas are already so low that they pose no threat to human health and the environment, even for very susceptible populations.  Therefore, the rule is expected to have almost NO incremental health benefits over and above what current law is achieving"

EDF Response:  Mercury is a toxin that causes nerve and brain damage, especially in young children and developing fetuses. Mercury from coal-fired power plants can be locally deposited, causing “hotspots” in lakes and streams around the country. The claim that drastically reducing mercury will not deliver benefits simply beggars belief.

We see here again the oft-cited argument that EPA should not be counting the benefits to Americans of reduced heart attacks and lung disease from reducing pollution.  An argument that any American with lung or heart disease would have a hard time agreeing with.  The parents of the 400,000 children a year born in the U.S each year with more mercury in their blood than will permit a healthy brain development as they grow -  such that these children’s capacity to see, hear, move, feel, learn and respond is compromised – may also question the utilities’ health claims.

Segal: "There is no direct relationship between today’s action and children’s asthma.  EPA has reported that “between 1980 and 2010…total emissions of the six principal air pollutants dropped by 67 percent.”  See http://epa.gov/airtrends/aqtrends.html#comparison  Over this same period – as soot (or particulate matter) emissions have fallen sharply, childhood asthma rates have increased – likely as a result of better-insulated homes or other indoor exposures"

EDF Response: The causes of increases in asthma rates are not fully understood.  But what is fully understood is that for children and adults with asthma, more air pollution causes more asthma attacks. The pollution reductions resulting from this rule are expected to avoid 130,000 asthma attacks a year. 

What's more, Segal entirely ignores the crippling health effects of mercury on children.  Mercury concentrates in a developing fetus such that it’s concentration in an unborn child’s blood is on average 70% higher than in its mother’s bloodstream. Some 400,000 children are born in U.S each year with so much mercury in their blood that healthy brain development is impaired. As they grow, these children’s capacity to see, hear, move, feel, learn and respond is severely compromised.

Segal: The American Lung Association endorsement of the final Utility MACT was offered before they could have possibly reviewed EPA’s work, [so]  their views must be met with some skepticism.   Indeed, seven physicians that serves in the US House of Representatives wrote the EPA Administrator complaining that EPA’s rule has few health benefits and may even injure public health due to its high costs and impact on employment. 

EDF Response: EPA’s rulemaking materials included over 130 peer-reviewed scientific and health studies.  The health basis for this rule is unimpeachable. 

Segal: "Some power companies [supported this rule because they] have business models that allow them to charge more for the power they provide as the wholesale clearing price for energy increases – even if they are spending no more money on compliance with new regulations.  For these companies, the more expensive environmental regulations are for their competitors in other regions, the higher the clearing price will be, and the more money they will make."  

EDF Response: The truth is that some power companies acknowledged years ago that this rule was coming, and that it would bring health benefits to their customers, so they made investments and got started cleaning up their emissions.  Further delay of the Mercury and Air Toxics rule we have been awaiting for 20 years just rewards bad actors and punishes good actors.

Segal: "The rule suffers from statistical errors, inaccurate technological assumptions, and inadequate economic and reliability analysis.  Given that the rule is one of the most expensive air rules ever, the American public deserves better.  As for relying solely on EPA to grant discretionary amounts of additional time, that can be dangerous from a planning and reliability perspective.  As the nation’s grid operator – the NERC – observed, it is better to address the timing and scope of the regulation at the front end.... Concern with reliability is widely shared by some 27 states as reflected in briefs filed in the deadline case regarding Utility MACT, letters from governors, and rulemaking comments filed by public service commissioners and other state officials."

EDF Response: It is truly sad that in their attempt to the delay the rule, some utilities have stirred up unfounded fears of a national electricity reliability crisis.

Recent analysis by the U.S. Department of Energy, the Congressional Research Service, the North American Electric Reliability Corporation, Michael J. Bradley and Associates and The Analysis Group, and testimony before Federal Energy Regulatory Commission all put to rest the claims by laggard utilities that the EPA Mercury and Air Toxics Rule would cause national electricity reliability problems.  Lisa Jackson, EPA Administrator, recently said, “In 40 years, the Clean Air Act has never caused a reliability problem.  I am confident that this rule can be implemented in a way that lets businesses make the decisions that they need but doesn’t sacrifice public health.”

Furthermore, in a Presidential Memo released today, the president has instructed federal agencies to work with utilities, RTOs and others to “Promote early, coordinated, and orderly planning and execution of the measures needed to implement the MATS Rule while maintaining the reliability of the electric power system.”

The history of utility predictions on cost and economic impact shows they are not to be believed.  In the 1980s and 1990s, for example, industry overestimated the cost of the Acid Rain program by a factor of four to ten—even claiming it could lead to “the potential destruction of the Midwest economy (AEP).”

Here's the simple truth about the EPA's new mercury rule: It will saves lives and prevent human tragedy across the country. We have been preparing for it for more than 20 years. And we can afford it. The rule’s benefits more than outweigh its costs.

Segal: "These rules are NOT the "first-ever" mercury standards for power plants.  In 2003, the Bush EPA... proposed and then finalized the first-ever mercury standards for power plants.  Of course, they were eventually litigated and stayed when environmental groups opposed them because they were achievable and had a trading program.  It should be remembered that the only reason we haven't had mercury rules over the past six years is because the environmentalists blocked them."

EDF Response: Segal's history leaves out an important fact: The Bush-era standards were thrown out by a federal judge because they would have avoided the level of control required under the Clean Air Act for the most toxic air pollutants. Here's a bit more historical background:

• In August 2001, the Bush Administration's EPA established a Work Group with representatives from Industry, States, and Environmental organizations.  The group worked to develop recommendations for a Mercury MACT.  In April 2003, the Bush Administration's EPA dismantled the panel unexpectedly and without explanation.
• In December 2003, the Bush Administration's EPA proposed two regulatory alternatives to address this source category, one regulating the source under Section112, and a second which would remove Electric Generating Units from the list of sources and allow companies to use a cap-and-trade system instead of plant-specific emission limitations. Not requiring mercury reductions at each plant would perpetuate local mercury ‘hotspots” often near our most disadvantaged communities.
• In 2005, the Bush Administration decided to “delist” coal-fired EGUs and allow a cap-and-trade program rather than maximum achievable control technology, further subjecting local communities to harm. 
• Fifteen states, several Native American tribes, and a variety of public health and environmental organizations sued the EPA over this decision to not require maximum achievable reductions at each facility.

On February 8, 2008, U.S. Court of Appeals for the D.C. Circuit overturned the Bush Utility Mercury rule which would avoid controls at each power plant. Because power plants are such a large source of air toxics, the law requires each power plant to install the Maximum Available Control Technology.  Later, the District Court issued a Consent Decree calling for EPA to propose a new rule no later than March 16, 2011 and of the final rule no later than November 16, 2011.

EDF experts Mark MacLeod, Vickie Patton, Gernot Wagner, Kritee, Megan Ceronsky and Mandy Warner contributed to this response. To reach them, or for any further information, contact:

Sharyn Stein
EDF
202-905-5718
sstein@edf.org

Thank you