Politics & Policy

Obama’s Power Plan versus Economic Reality


This month, the Environmental Protection Agency released its new guidelines for the states to follow in reducing emissions from the power plants that provide reliable electricity for our homes, schools, offices, and hospitals. These regulations will do little to improve the environment, but will significantly increase our monthly electric bills, cause frequent power outages, destroy millions of jobs, and shut down entire companies at a time when the economy needs a boost, not a brake.

The EPA’s “Clean Power Plan for Existing Power Plants” requires states to cut carbon-dioxide emissions from power plants by almost a third from what they were in 2005 — and to do it in just 15 years. Coal-burning power plants and even the cleaner-burning natural-gas-fired plants are the targets, and the Obama administration intends for “green” energy sources like wind and solar to replace them.

There are two huge technical problems with the government’s plan. The first is that the technology hasn’t been developed yet for existing power plants to fully comply, and the EPA knows it. That means plants will face huge fines or will have to shut down entirely, as is already happening in the coal industry. The second is that the technology doesn’t yet exist for wind, solar, and other green sources to produce energy as reliably and inexpensively as coal and natural gas. Solar has potential in the decades to come, but it’s doubtful that wind power will ever be able to scale up to the extent needed to power our $18 trillion industrial economy.

As power plants are forced to shut down or scale back in favor of less reliable, more costly alternatives, the impacts of the new regulations will be harsh. Such regulations act like a regressive tax, raising energy prices for those who are already hurting the most financially. A report prepared for the National Black Chamber of Commerce says that the impact of these regulations “on low-income groups, Blacks, and Hispanics would be especially severe. The EPA rules would: 1) Significantly reduce U.S. GDP every year over the next two decades — over $2.3 trillion; 2) Destroy millions of jobs; 3) More than double the cost of power and natural gas to over $1 trillion; 4) Require the average family to pay over $1,225 more for power and gas in 2030 than in 2012.”

RELATED: The Cynicism of the Clean Power Plan

With all these drawbacks, what benefits will the American people see? Perhaps a small reduction in a mere fraction of America’s carbon-dioxide emissions. And with our emissions accounting for such a small part of current global emissions, the rule will probably have no discernible impact on the planet’s surface temperature. Any reasonable weighing of the costs and benefits of these new rules would tell us that they are just about all pain, no gain. That’s especially true because China, India, Japan, and other nations are building new coal-fired plants at three to four times the pace at which we are closing them.

The EPA and other federal agencies are usurping Congress’s power, and President Obama has been a willing accomplice when it serves his purpose.

In addition, the Obama administration’s continual illegal overreach in areas like this is a threat to our liberty. The EPA and other federal agencies are usurping Congress’s power by effectively making laws that Congress did not pass, and President Obama has been a willing accomplice when it serves his purpose.

Indeed, in the case of the Clean Power Plan, the EPA is making a law that a Congress controlled by the president’s own party rejected just a few years ago. The Obama administration couldn’t get what it wanted through the people’s representatives in Congress, so the EPA is trying to impose regulations by executive fiat.

This means that the Supreme Court may well strike the rule down in a few years, just as it struck down the EPA’s mercury-emissions rule this June. The problem is, the mercury rule was in effect for three years, and during that time the EPA got what it wanted, regardless of the court’s ultimate ruling — electric plants had already installed expensive emissions-control technology.

EDITORIAL: The EPA’s Emissions Overreach

The EPA appears to be using the same strategy with the Clean Power Plan: force states to make essentially irrevocable decisions on issuing permits, mandating new equipment, and closing plants before the Supreme Court has a chance to strike down the rule.

Cheap and abundant energy is the wellspring of modern life on earth. The use of fossil fuels has done more to reduce poverty — by providing affordable energy — here and across the planet than all the government welfare programs put together.

#related#The Obama administration’s attack on fossil fuels under the guise of preserving health and welfare ironically undermines one of the most critical reasons for the rapid increase in human flourishing the world has witnessed over the past 200 years.

Congress cannot be a passive observer sitting on the sidelines, watching as this regulation is implemented. It must rein in the EPA and other overreachers of the administrative state. This is doubly important since the EPA is also trying to shut down natural-gas production in the United States.

Congress must be willing to use the power of the purse to prevent the EPA from using funds for any program — such as this so-called Clean Power Plan — that violates laws Congress has passed. That is the constitutional solution to an unconstitutional problem.

— Stephen Moore is a senior fellow at the Heritage Foundation. Dave Brat (R.) represents Virginia’s 7th District in the U.S. House of Representatives. He is a member of the House Budget Committee, the Education and the Workforce Committee, and the Small Business Committee.



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