(Montana Standard, October 19) – The EPA’s new “clean power rule” would impose new limits on carbon emissions that would devastate our coal industry. As a result, these rules will increase energy costs, hamstring job creation and economic growth and reduce the amount of revenue available for Montana’s infrastructure and schools. In the long-run, this rule may even have the opposite impact of what is intended.
Under the rule proposed by President Obama’s EPA, our state is facing a federal mandate to cut carbon emissions by more than one-fifth from 2012 levels. These reductions would have a negligible impact on carbon emissions. Even the president’s former-EPA administrator Lisa Jackson admitted that “U.S. action alone will not impact world CO2 levels.” Another analysis concluded that the “U.S. could shut down all coal-fired plant and global carbon emissions would only be reduced by less than 1 percent.”
However, the rule would have far-reaching negative implications for Montana businesses and working families. More than 5,000 good-paying jobs with an annual payroll of $273 million would be at stake. The unemployment rate on the Crow Indian Reservation alone would “skyrocket from 47 percent to 80 percent” without coal revenue.
These new rules would require Montana to either join an expensive regional “cap and trade” program, compel coal plants to buy expensive retrofitting equipment, or force them to shut down. All of these options are bad. Each of them impose new costs on energy producers which will be passed onto consumers as higher utility bills.
These rules threaten funding for Montana’s infrastructure and needed programs. Montana’s coal industry contributes over $100 million in tax revenue to the state’s economy, with $35.5 million going toward infrastructure, $15.6 million for schools, and $3 million to libraries and parks.
Montana is home to one-third of all coal in America, with reserves that could meet America’s energy demand for over 100 years. Currently, Montana’s coal industry supplies over one-half of the state’s electricity needs. Coal remains the most cost-effective and reliable option for electricity generation in the state, and is a key reason that Montana has the 14th lowest electricity prices in the nation.
The ramifications of the EPA regulations would not be restricted solely to jobs in Montana’s energy sector. As the Montana Chamber of Commerce has stated, “higher energy input prices will also be a big hit to other industries, like agriculture and manufacturing that use a lot of electricity and fuel.” One analysis projects a 26 percent increase in energy prices directly attributable to these regulations. And higher energy costs mean increased prices for products and services.
Struggling Montana families who will be the hardest hit by higher electricity bills. Lower income families spend an estimated average of 22 percent of their after-tax family budgets on energy. If the President’s EPA regulations are approved, these families may be forced to choose between heating their homes and putting food on the table.
In the long run these regulations could have the opposite impact intended. Kenneth Green, author of “Abundant Energy: The Fuel of Human Flourishing,” says that encouraging prosperity and economic growth is the best way to ensure the development of clean environmental technology. “The single best thing we could do to minimize energy’s impact on the environment is to not only maximize our own economic growth but also help developing countries to increase theirs, letting them switch to every cleaner, less polluting forms of energy,” writes Green.
Gov. Bullock is currently developing a plan to adopt these new rules. For the sake of our state’s economic growth, good-paying jobs, revenue for infrastructure, and affordable clean energy, Bullock should oppose not adopt these wrong-headed bureaucratic rules.