House panel, McCabe face off on ‘just say no’ bill 

Source: Jean Chemnick, E&E reporter • Posted: Monday, April 13, 2015

A key House Energy and Commerce Committee subpanel will hear testimony this week on draft legislation to allow states to opt out of U.S. EPA’s Clean Power Plan.

EPA air chief Janet McCabe will headline today’s hearing on a draft bill sponsored by Energy and Power Subcommittee Chairman Ed Whitfield (R-Ky.), which would grant all states a reprieve from deadlines to submit state implementation plans (SIPs) for the existing power plant carbon rule until judicial review has concluded. It would also let governors refuse to comply even then if they decide the rule will drive up electricity rates or harm grid reliability (E&E Daily, March 24).

The measure would bar EPA from implementing a federal plan to regulate power plants in states that do not comply. McCabe and her Office of Air and Radiation staff are crafting a federal model now for release this summer.

Whitfield has offered his bill as a more moderate alternative to simply scrapping the rule. The subcommittee chairman told reporters last month that he hoped the approach would garner Democratic support, including in the Senate. He plans to move it quickly through regular order, with a markup expected soon. But he said it would also play a role in focusing public attention on the rule’s impacts.

“We are going to do everything possible so that the American people are aware of the effort made by EPA to control the electric generating system in each state,” he said.

But EPA Administrator Gina McCarthy said last week at the University of Chicago that the draft rule is a perfect example of cooperative federalism as embodied in the Clean Air Act. States have wide discretion to meet the federally set targets through whatever means they choose, she said, and EPA is eyeing tweaks to the final version that would make it even more responsive to state concerns.

The rule as proposed would require power plants to cut emissions by 30 percent nationwide by 2030, often by shuttering coal units. It is set to be final this summer.

The Clean Power Plan’s proponents say states will have more control if they choose to plot their own course on compliance, but Republican lawmakers led by Senate Majority Leader Mitch McConnell (R-Ky.) advise states that are skeptical of the plan not to do so. EPA’s rule is likely to be knocked down in court, they say — a point Whitfield’s bill seeks to underline with its provision delaying the SIP deadline until litigation ends.

Murray Energy Co. and 13 states aim to put the Clean Power Plan to an early test, suing to prevent EPA from finalizing it on the grounds that the statute bars EPA from regulating power plants for greenhouse gases because it is already regulating them for mercury and other air toxics. A three-judge panel of the U.S. Court of Appeals for the District of Columbia Circuit will hear arguments Thursday.

But McCarthy dismissed the challenge last week, saying, “I am entirely confident that we are on the right side.”

Even if the rule survives court challenges, its opponents say a federal plan may still be less stringent than the plans EPA hopes to persuade states to write themselves because the federal agency has fewer compliance tools at its disposal.

Many of the witnesses who will join McCabe on the dais tomorrow support this “just say no” strategy and legislation to bar EPA from implementing the rule itself.

The witnesses include Eugene Trisko, who will speak on behalf of the American Coalition for Clean Coal Electricity and who called the rule “a neutron bomb aimed directly at the heart” of the coal industry at a recent Senate field hearing.

Lisa Johnson, CEO and general manager of Seminole Electric Cooperative Inc., will represent the National Rural Electric Cooperative Association. Rural electric co-ops, which are heavily invested in coal, have been almost as staunchly critical of the EPA rule as the industry has been.

Kevin Sunday, manager for government affairs at the Pennsylvania Chamber of Business and Industry, and Paul Cicio, president of the Industrial Energy Consumers of America, are the other Republican-invited witnesses.

Cicio said in a recent interview that the power plant rule will harm manufacturing, not only by driving up the cost of energy but by setting precedent for restrictions on other sectors.

Under the power plant rule, he said, states would have to “re-engineer their power grids” and enact numerous laws to support state plans that might never go into effect if the courts invalidate the rule. That argues for a stay on state plans until litigation is settled, he said.

But environmentalists note that plaintiffs can already ask courts to stay rules if certain conditions are met — including if they are likely to be overturned and would cause irreparable harm in the meantime. Courts are unlikely to see the obligation to craft a compliance strategy by deadlines beginning next year as a threat sufficient to warrant a stay, they say.

Susan Tierney, senior adviser for the Analysis Group, will round out the hearing. Tierney has authored several analyses arguing that the rule would pose no threat to grid reliability, and she said during a recent appearance on E&ETV that states would be better off promulgating their own SIPs (Greenwire, Feb. 19).

Schedule: The hearing is Tuesday, April 14, at 10 a.m. in 2123 Rayburn.

Witnesses: Janet McCabe, acting assistant EPA administrator for the Office of Air and Radiation; Eugene Trisko, energy economist and attorney on behalf of the American Coalition for Clean Coal Electricity; Lisa Johnson, CEO and general manager of Seminole Electric Cooperative Inc. on behalf of the National Rural Electric Cooperative Association; Kevin Sunday, manager for government affairs at the Pennsylvania Chamber of Business and Industry; Paul Cicio, president of the Industrial Energy Consumers of America; and Susan Tierney, senior adviser for the Analysis Group.