NCPA - National Center for Policy Analysis


January 12, 2010

A growing number of state regulators are urging the Obama Administration to slow the rollout of proposed federal rules curbing industrial greenhouse-gas emissions, saying the administration's approach could overwhelm them with paperwork, delay construction projects and undercut their own efforts to fight climate change, says the U.S. Chamber of Commerce.

Regulators from around the United States, including Kansas, Pennsylvania, Florida and California are calling on the Environmental Protection Agency (EPA) to go slowly with its new rules, and in some cases warning that they lack funding to regulate some of the new emissions sources that would be covered, says the Chamber.

  • In a Dec. 24 letter to the EPA, the California Energy Commission, which oversees energy policy in the state, said the EPA's proposal "will likely retard, rather than facilitate," reductions in greenhouse-gas emissions from its electricity sector.
  • Because California, which has been a leader among states in pursuing its own emissions efforts, plans to require electric utilities to use more renewable power than they do currently, the state needs new natural-gas-fired power plants to provide back-up power when the wind doesn't blow or the sun doesn't shine.
  • Most of those new plants aren't subject to the EPA permit process but will require permits under the EPA's proposal, the state says.

The Obama administration has said it would prefer that Congress pass legislation that would use a so-called cap-and-trade system to curb greenhouse-gas emissions:

  • Under a cap-and-trade system, the government would require companies to hold permits in order to emit greenhouse gases.
  • Over time, the government would issue fewer permits, bringing emissions down while allowing companies to buy and sell permits among themselves.
  • But prospects for that legislation passing the Senate -- at least in its current form -- are dim, leaving EPA regulation as the administration's main tool.

In order to acquire a permit, facilities would be required to demonstrate to state or local regulators that they are using the best practices and technologies to minimize greenhouse-gas emissions.  The decision on what constitutes those practices would, in most cases, be left to states, which are expected to rely heavily on guidance from the EPA. The EPA is expected to publish such guidance in the coming months.

Source: Brad Peck, "From the States -- Emissions and the EPA," U.S. Chamber of Commerce , January 11, 2010; and Stephen Power and Ian Talley, "States Want Delay on Emission Rules," Wall Street Journal, January 12, 2010.


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