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Regulate CO2 Under the Clean Air Act . . . Crash the Economy



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On Tuesday, the U.S. Chamber of Commerce released a study on the compliance burdens businesses will incur if the EPA, in response to Massachusetts v. EPA, decides to establish first-ever greenhouse gas (GHG) emission standards for new cars and trucks.

As is now widely acknowledged (see pp. 475-490 of EPA’s Advanced Notice of Proposed Rulemaking), regulating GHGs from new motor vehicles would make carbon dioxide (CO2) from “stationary sources” like buildings, farms, and factories a “pollutant subject to regulation” under the Clean Air Act’s Prevention of Significant Deterioration (PSD) pre-construction permitting program.

Under the PSD program, a facility is regulated as a “major stationary source” if it emits 100 tons per year of a regulated pollutant and is in one of 28 listed categories, or emits 250 tons per year and is any other kind of facility.

Mark and Portia Mills, the study’s authors, estimate that more than 1 million commercial buildings, nearly 200,000 manufacturing firms, and about 20,000 farms emit 250 tons per year of CO2. All of these entities would become subject to regulation, monitoring, and enforcement under the PSD program if EPA sets CO2 emission standards for cars.

Lots of entities that are clearly not big industrial polluters would get nailed. For example, the over one million commercial buildings that would become classified as new stationary emission sources include “over one-fourth of all school buildings, over two-thirds of health care facilities, one-third of office buildings, half of those in lodging, and one-fifth of food services.”

Since PSD regulates construction activity at both new and modified facilities, regulating CO2 under the PSD program could bring construction in the U.S. to a screeching halt. The combination of the PSD-induced big chill on construction, rising energy prices, the sub-prime fiasco, and consequent meltdown of major U.S. financial institutions could well become the “perfect storm” that tanks our economy.

And yet the greenhouse gang in Congress bashes Bush and EPA Administrator Johnson for pulling EPA back from the brink and carefully reviewing the issues via the ANPR process rather than racing pall-mall to regulate CO2.

Maybe the Kyotophiles on the Hill believe the public won’t perceive their responsibility for the economic fallout if EPA implements in spades the regulatory agenda they have repeatedly tried but failed to enact. If so, then they seriously underestimate both their opponents and the public.



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