Week In Review

State Capitol Week in Review

            LITTLE ROCK – The big news in government last week, at both the federal and local levels, was the announcement by the federal Environmental Protection Agency (EPA) of proposed new restrictions on carbon dioxide emissions by power plants that burn coal.

            Two state agencies will be responsible for implementing the new rules in Arkansas. They are the Arkansas Department of Environmental Quality (ADEQ) and the Public Service Commission (PSC).

            Officials of ADEQ and the PSC have already begun working on the new carbon dioxide emission standards, and will continue to hold meetings regularly with utilities and businesses directly affected by the proposed rules.

            The state ADEQ enforces environmental regulations and the state PSC has regulatory jurisdiction over rates and other utility operations.

            The EPA seeks to reduce carbon emissions throughout the United States by 30 percent from 2005 levels, by the year 2030. However in Arkansas, because of our reliance on coal to generate electric power, initial estimates are that the new EPA rules would require a 44 percent reduction in emissions of carbon dioxide.

Instead of proposing a uniform set of regulations for the entire country, the EPA’s proposal gives individual states flexibility to come up with a plan that best suits local needs.

            The proposed new clean air standards quickly generated a storm of controversy, with opposition coming from utilities that rely heavily on coal, utilities that own a lot of older plants that are not as efficient as newer plants, and elected officials of both political parties who represent coal-producing states.

According to the EPA, Arkansas generates about 44 percent of its electrical energy from coal and 26 percent from natural gas. Nuclear power provides 24 percent and the remainder comes from alternative sources like hydropower and wind.

            Producers of natural gas stand to benefit from the EPA’s regulations because it burns cleaner than coal.  Also likely to benefit will be companies that produce alternative energy – such as wind and solar power. The reason is that states and utilities will be able to comply with the stricter new standards through variou8s methods besides reducing carbon dioxide emissions at existing power plants.

For example, they can invest in renewable energy sources that don’t emit carbon dioxide.  Also, they can reduce consumption of electric power through energy conservation programs.

Business groups that oppose the new emission standards argue that they will cost hundreds of millions of dollars in higher electric power costs, thereby weakening the economy and risking the loss of thousands of jobs. 

On the other hand, supporters of the tighter regulations point to the health problems caused by carbon dioxide. They claim that the new rules will save millions in lower medical care costs for asthma and chronic lung disease.

Political observers predict that the controversy generated by the EPA’s new rules will be long-lived and acrimonious, similar to the controversy that erupted over health care reforms in the federal Affordable Care Act. 

As with the federal health care reforms, state agencies will play an important role in the implementation of stricter carbon dioxide regulations.  That means the issue will be debated not only in Washington, D.C. but in all 50 state capitals.