EPA's Impact on New Mexico: Higher Prices, Fewer Jobs
February 6, 2015
New Mexico residents already face high electricity rates compared to others in their region, and those prices will only rise. In a report from the Rio Grande Foundation, the Beacon Hill Institute has analyzed the impact of new EPA regulations on New Mexico. The results? Lost jobs and higher electricity bills for New Mexico's residents.
The EPA has proposed new rules to limit carbon dioxide emissions as well as mercury emissions from coal-fired power plants -- to meet the goals, plants will have to shut down or purchase expensive new equipment to meet the federal standards. While the agency claims billions in health benefits from these rules to offset costs, the report notes that the agency has been criticized for its cost-benefit calculations.
According to the study, New Mexico is especially dependent on coal -- 68 percent of its electricity comes from coal today. And while the state's reliance on coal has fallen by 9 percent from 2007 to 2012, electricity prices have skyrocketed 19 percent during that time.
Using its State Tax Analysis Modeling Program model, the Beacon Hill Institute estimated how these new rules would impact New Mexico's economy. It found:
- Cutting carbon dioxide and mercury emissions will cost the state $185 million in 2030.
- Electricity prices will rise 18 percent by 2030.
- The state would lose 5,170 jobs by 2030.
- Real disposable income would drop by $578 million per year by 2030.
- Investment in New Mexico would drop by $58 million.
Source: "The Economic Effects of New EPA Rules on the State of New Mexico," Beacon Hill Institute/Rio Grande Foundation, January 2015.
Browse more articles on Environment Issues