Politics

Obama’s War on Coal Goes to Court

At stake is whether entire industries, and the jobs they support, can be wiped out by unilateral executive action

This week, a major chunk of President Obama’s legacy will face microscopic scrutiny when the U.S. Court of Appeals for the District of Columbia Circuit hears opening arguments regarding the Environmental Protection Agency’s “Clean Power Plan” (CPP).

Not only does this president have a stake in the outcome — so does the next one. That’s because no issue more clearly divides Hillary Clinton and Donald Trump than the coal industry’s future and the jobs it supports. And no regulation will affect that industry more than the CPP. Clinton has pledged to double down on the rule; Trump has vowed to stop it. If the court upholds the CPP, it would embolden Clinton to continue the president’s efforts to keep coal in the ground. If the court declares the CPP unlawful, it could help Trump fulfill his pledge to end the coal calamity that has already claimed 68,000 mining jobs since 2011.

It’s estimated that 40 states will see double-digit increases in wholesale power prices, and 16 states could even see prices jump by at least 25 percent.

The legal issues before the court are dauntingly complex, but the decisive issue before the nine judges can boldly be summarized as: What, if any, are the limits of executive power? The EPA and its supporters will defend the plan, relying heavily on the court’s inclination to give regulators a free hand in interpreting environmental statutes.

The counter argument, advanced by 28 states and assorted mining, utility, and manufacturing interests, is that the EPA has once again abused its discretion. Congress never authorized the EPA to transform the nation’s power supply by dictating comprehensive changes to each state’s energy grid. Nor should EPA ignore 45 years of Clean Air Act precedent that has previously limited it to regulating discrete sources. EPA’s authority to regulate pollutants under Sec. 111(d) is confined to emissions within a plant’s control or “fence line” — it doesn’t extend from the fence line to a state’s border.

And there are massive costs to be addressed. Among other things, the CPP will shutter 40 percent of America’s current coal fleet, necessitating roughly $64 billion in nationwide construction of new generating facilities and transmission infrastructure. On top of that, there’s also a projected $214 billion hike in wholesale electricity prices by 2030, prompted by the loss of so much affordable, coal-fired power generation.

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Governors, who are already bristling at the prospect of losing control over their individual power sectors, are understandably troubled by the whopping costs that would be imposed on their residents. It’s estimated that 40 states will see double-digit increases in wholesale power prices, and 16 states could even see prices jump by at least 25 percent.

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Is all this pain worthwhile? Part of any judicial test of reasonableness involves weighing the benefits of regulation against the costs. Challengers note that the CPP’s projected environmental benefits are virtually nil. A fully implemented CPP is expected to lower atmospheric CO2 concentrations by less than 1 percent, and reduce global temperatures by a theoretical 0.018 degrees Celsius by the year 2100.

The global warming issue is important and the debate over how to address it obviously has its place. But that public policy question won’t be the issue before the court. Two larger legal questions are in play: Can the administration ignore the Congress, and the plain language of law, to impose a costly rule on state economies? And, since Congress never empowered the EPA to manage the transformation of the nation’s entire power sector, by what definition does the EPA believe it now has such authority and ability?

The court should recognize the troubling overreach imposed by such hubris, and halt such a costly plan.

Luke Popovich is vice president for external relations at the National Mining Association (NMA).

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