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EPA carbon plan will kill 38,000 Virginia jobs, report says

By   /   April 1, 2015  /   News  /   No Comments

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WAR ON EPA: U.S. Rep. Morgan Griffith, representing Virginia’s hardscrabble coal country, calls federal promises of new jobs “hogwash.”


By Kenric Ward | Watchdog.org Virginia Bureau

The Environmental Protection Agency’s Clean Air Plan will boost Virginia’s electric rates 25 percent and eliminate 38,000 jobs in the state, a new study predicts.

“These EPA rules are aimed at reducing carbon dioxide emissions from producers of coal power plants by either shutting them down or making their cost uncompetitive in the marketplace,” stated the report released Tuesday by the Thomas Jefferson Institute for Public Policy and the Beacon Hill Institute.

“If the electricity production from coal is eliminated, the diversity of the electricity supply sources will fall and become more dependent on natural gas and its price fluctuations. If the new expensive and untested carbon capture and sequestration technology is adopted electricity prices will increase.”

Researchers said higher electricity costs would “threaten the state’s industrial base.”

Randy Randol, a Virginia-based energy analyst, and David Botkins, spokesman for Dominion Power, said the report confirmed the State Corporation Commission’s warning of the negative economic impact of stricter EPA rules. Botkins said rate increases could run as high as 30 percent.

The 2015 General Assembly enacted some consumer protections. Senate Bill 1349, signed by Gov. Terry McAuliffe, freezes base electric rates for five years and prohibits power plant closures without prior approval of the SCC.

EPA’s proposed rules for new plants would limit CO2 emissions to 1.1 pounds per kilowatt hour of electricity production — less than half the current average. The EPA’s target reduction for Virginia is 38 percent versus a national reduction of 30 percent.

Beacon Hill concluded the carbon emission rule on new power plants will cost Virginia $336 million in 2030, and rules for existing plants will run $592 million. Separate regulations on mercury emissions will cost an additional $817 million, the study said.

The state’s projected 38,000 job losses and price increases would combine to reduce real incomes as firms, households and governments spend more of their budgets on energy and less on other goods, the report predicted.

“As a result, real disposable income would fall by $4.451 billion by 2030, and annual investment in the state would fall by $515 million. The investment losses are mildly offset by increased investment in other electricity technologies,” researchers concluded.

U.S. Rep. Morgan Griffith, R-Abingdon, called promises of offsetting economic gains “hogwash.”

“This (report) is exactly what we’ve been saying. (The air rules) will be a lot more expensive than the EPA is willing to admit,” Griffith told Watchdog.org in a phone interview.

Griffith, a member of the House Energy and Commerce Committee, said the economy of his southwestern Virginia district has been battered for decades by Washington policies.

“From textiles to tobacco to furniture, it’s not what we had 25 years ago. All we see is empty promises from the federal government,” the congressman said.

Michael Thompson, president of the free-market oriented Jefferson Institute, said, “At a time when Virginia is clawing its way out of the recession, the (EPA) costs will have a devastating impact on Virginians.

“With a major legal challenge expected immediately after the final regulations are published — and a resultant two-year court battle — the prudent course of action would be for the General Assembly to refuse to implement a state plan under the new federal regulations,” Thompson said.

Last month, EPA Administrator Gina McCarthy acknowledged her agency doesn’t have the legal authority to withhold federal highway funding from states that opt not to comply with its Clean Power Plan.

Nevertheless, state Delegate Israel O’Quinn said, “The catastrophic possibilities cannot be overstated.”

“Virginia still has an opportunity to avoid these rules, and I am hopeful we will do everything in our power to do so,” the Bristol Republican told Watchdog.

Kenric Ward is a national correspondent for Watchdog.org and chief of its Virginia Bureau. Contact him at (571) 319-9824. @Kenricward


Kenric Ward was a former San Antonio-based reporter for Watchdog.org.