EPA Administrator Scott Pruitt
EPA Administrator Scott Pruitt

Environmental Protection Agency Administrator Scott Pruitt on Tuesday proposed to repeal the so-called “Clean Power Plan” (CPP). The CPP established emission guidelines for states to follow in limiting carbon dioxide (CO2) emissions from existing power plants. The EPA determined the Obama-era regulation exceeded the agency’s statutory authority. According to the EPA, repealing the CPP would facilitate the development of U.S. energy resources and reduce unnecessary regulatory burdens associated with the development of those resources. They noted this action is in keeping with President Donald Trump’s executive order on energy independence.

“The Obama administration pushed the bounds of their authority so far with the CPP that the Supreme Court issued a historic stay of the rule, preventing its devastating effects to be imposed on the American people while the rule is being challenged in court,” Pruitt said. “We are committed to righting the wrongs of the Obama administration by cleaning the regulatory slate. Any replacement rule will be done carefully, properly, and with humility, by listening to all those affected by the rule.”

The EPA found that these regulations imposed under the Obama administration are inconsistent with the Clean Air Act. The Supreme Court issued a stay on the rule in February of 2016.

“EPA will respect the limits of statutory authority.  The CPP ignored states’ concerns and eroded longstanding and important partnerships that are a necessary part of achieving positive environmental outcomes. We can now assess whether further regulatory action is warranted; and, if so, what is the most appropriate path forward, consistent with the Clean Air Act and principles of cooperative federalism,” Pruitt added.

The Trump administration estimates the proposed repeal could provide up to $33 billion in avoided compliance costs in 2030.

The EPA said that the Obama administration’s estimates and analysis of these costs and benefits were, in multiple areas, highly uncertain, controversial, or both.  Specific areas of controversy or uncertainty in the Obama administration’s analysis of CPP they said include:

  • Domestic versus global climate benefits: The previous administration compared U.S. costs to an estimate of supposed global benefits, and failed to follow well-established economic procedures in estimating those benefits.
  • “Co-benefits” from non-greenhouse-gas pollutants:  The Obama administration relied heavily on reductions in other pollutants emitted by power plants, essentially hiding the true net cost of the CPP by claiming benefits from reducing pollutants that had nothing to do with the rule’s stated purpose.
  • Energy cost and savings accounting: The Obama administration counted “energy efficiency” results of their rule as an avoided cost, resulting in a cost estimate being considerably lower than it would have been if they used the appropriate practice of considering these effects as benefits, rather than subtracting them from costs. Had the Obama administration used the Office of Management and Budget’s longstanding requirements and accounted cost and savings accordingly, it would have presented a more accurate accounting of the total cost of the CPP.

Opponents of the Obama-era Climate Change policy celebrated the news.

“The regulation was ill-advised from the start,” Cornwall Alliance National Spokesman Dr. E. Calvin Beisner said. “It was based on the belief that carbon dioxide emissions cause dangerously rapid global warming. That was doubtful in 2009 when EPA issued its ‘finding’ that CO2 emissions endanger public health—which is the legal basis for the CPP. Since then, global temperature data have falsified that belief, so EPA has no basis for the endangerment finding and no reason for the CO2 regulation.”

“This is welcome,” Dr. Anthony Lupo, Professor of Atmospheric Science at the University of Missouri, stated. “Based on the report that questioned the endangerment finding, the regulations ill-advised.”

Cornwall Alliance Senior Fellow Dr. Craig Mitchell, an economist, engineer, and Southern Baptist theologian, said Pruitt’s decision “represents a movement in the right direction. However well-intentioned it may have been, the CPP was too costly in terms of both energy production and jobs. The American people will be well served by this decision.”

“Despite claims from environmental groups that ending the CPP is going to have catastrophic effects on climate and air quality, this simply is not true,” Dr. William Anderson, Professor of Economics at Frostburg State University, shared. “The best path to a clean environment is through increased productivity and an economically better-off society. Mr. Pruitt is overturning regulatory policies that would have made Americans poorer, but with no discernible improvements in public health. It was the right thing to do.”

“Full implementation of the CPP would cost the American economy about $2.5 trillion in lost GDP by 2035 and the average family of four $20,000,” Dr. Timothy Terrell, Associate Professor of Economics, Wofford College, Spartanburg, SC, and a specialist in environmental regulatory economics stated. “It would also increase household electricity expenditures by 13 to 20 percent and cause an annual shortfall of nearly 400,000 jobs, especially in manufacturing.”

The only way to meet CO2 emission targets EPA imposed was to shut down coal-fired power plants. That meant forgoing five, ten, twenty years or more of low-cost electricity from those plants and replacing it with higher-cost electricity from wind and solar.

“This and the Administration’s announcement in June withdrawing the United States from the Paris climate agreement are two great steps toward restoring market forces in American electricity generation. That will bring prices down and reliability up,” Lupo explained.

“Next, Mr. Pruitt and President Trump need to reverse the CO2 endangerment finding itself,” Beisner added. “As long as it stays on the books, environmental advocacy groups can use it as the basis for lawsuits to force CO2 emission regulation. Take it away, and the whole house of cards collapses.”

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