How Much are You Willing to Pay for EPA’S Rules?

Now that some of the costs associated with the EPA plan are becoming evident, it’s no surprise that public support is waning

By Bob Lake

How much are you willing to pay for EPA’s rules?

Too little attention has been paid to the costs and benefits of the EPA’s proposal to regulate emissions from power plants. A recent series of presentations by Gov. Steve Bullock’s office on his plans for implementing the EPA’s rules focused on the technical aspects of different compliance scenarios – but there was virtually no discussion of the costs of those scenarios nor what the EPA’s rule would accomplish overall.

It’s really putting the cart before the horse to figure out how best to comply with the EPA’s rule before we have a real discussion about what the costs will be for Montanans.

Recent polling bears this out. In a survey conducted this month by the Partnership for a Better Energy Future (PBEF), 74 percent of Montana voters agreed that the “government should weigh all costs/benefits” when creating a rule like the EPA’s proposed emissions regulation. Only 15 percent thought that government should confront climate change “at any cost.”

Yet it seems that the “at any cost” crowd is in the driver’s seat both at the national level and in Montana.

PBEF’s polling shows that in Montana and in the nation overall, the EPA’s proposal has very little support. Only 39 percent of Montanans surveyed supported the rule. For the rest, the costs were the driving forces behind their opposition. Costs both in monetary terms – higher energy prices – and in terms of lost jobs and economic opportunity for our state.

It’s notable this much opposition has formed before the full magnitude of those costs has really been examined. Exactly how big is the burden that Montanans can expect to result from the rule?

In a recent study conducted by NERA Economic Consulting, it’s estimate that the EPA’s plan could lead to double digit electricity price increases in 43 states, costing the U.S. economy over $350 billion in lost production. Montana is among the hardest-hit states in terms of energy price hikes – the study forecasts a 20 percent increase in the price we’ll pay for our electricity.

The magnitude of the job losses for Montana has not been calculated yet. But consider that the coal industry alone supports 5,000 jobs in our state – and these are high-wage jobs with the average wage and benefit package at Montana coalmines in the six-figures.

Two recent coalmine expansion proposals are predicted to lead to nearly 5,000 new jobs each. Those projects are highly unlikely if the EPA’s rule goes into effect, and all of our existing coal-related jobs are at risk.

So far, nothing has been proposed to replace the jobs we’d lose as a result of the EPA’s rule. There would be a few jobs created in the wind industry, for example, but nothing that would provide even a fraction of the jobs in the coal industry.

And we have to remember that for all the higher energy prices that would be forced upon Montana consumers, and for all the jobs that we could lose in our state, the benefit is tiny. The most optimistic projections are that the EPA’s proposal would lead to a 1.5 percent reduction in global emissions.

PBEF’s polling results also show a very real concern that the EPA’s plan could undermine our power grid, leading to brownouts and blackouts. That would be a further hit to our state economy – it’s hard for any business to thrive when their electricity supply is in question.

Now that some of the costs associated with the EPA plan are becoming evident, it’s no surprise that public support is waning. There’s little doubt that we need to address climate change, but we have to do it within a framework of reasonable costs – not at any cost. Those costs are an essential part of the discussion – it’s time our elected officials started giving them the attention they deserve.

Bob Lake, public service commissioner

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