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Battle Lines: 2011 Law and Lawyers Report

Generators fight back against EPA’s new regulations

Fortnightly Magazine - November 2011

to eliminate the Clean Air Act,” Akins says. “We’re weighing the significant, real-world issues, and trying to come out with a rational yet aggressive plan to achieve the environmental objectives. The difference between our 2020 plan versus the EPA timetable is the equivalent of one year’s worth of emissions, because we’d be reducing emissions every year.”

Such claims, however, seem doubtful to environmental advocates who have watched AEP and other coal-burning companies wage a perennial battle against EPA. “Over the years and even decades, we’ve seen a pattern of actions meant to delay, weaken, or overturn regulations that would require power plants to clean up,” MacLeod says. “AEP has used these same tactics for years.”

He refers to an EDF document titled “There They Go Again: AEP Seeks Delay in Health Protections for Children and Elderly.” In that document, EDF cites AEP executives and corporate communication materials, going as far back as 1974, denying the health effects of air pollution; asserting that compliance requirements simply can’t be met; and claiming environmental regulations will cost countless jobs and even destroy the Midwest economy.

“The Midwest economy was not destroyed,” MacLeod observes. “And the SO 2 standards were met at far less cost than people expected. AEP is no longer credible on these issues.”

Scorched Earth Strategy

In the battle over EPA’s new environmental regulations, advocates on both sides of the debate seem to have drawn a line in the sand. EDF, which traditionally has been known for legal advocacy efforts and not emotionally charged publicity campaigns, has taken a more aggressive stance in AEP’s case. And regulated companies have ratcheted up the hyperbole in their arguments against what some call EPA’s “job-killing,” “train-wreck” regulations. But whether their plant-shutdown decisions are based on rhetoric or reality, companies like AEP and Luminant have defined the effects of the new environmental regulations in a dramatic way that policy makers can’t ignore.

“When you have PUCs and ISOs saying, ‘Hold on, we need to keep the lights on,’ it creates a lot of political pressure,” says Jeff Holmstead, a partner with Bracewell & Giuliani, and former EPA assistant administrator. “There’s been a huge uptick in efforts in the courts and in Congress to overturn EPA’s decisions.”

At the same time, however, some experts suggest blackout fears are overblown.

In testimony on September 14, for example, Susan Tierney, managing principal at the Analysis Group and a former DOE assistant secretary, told members of the House Energy & Power Subcommittee that the EPA regulations appear manageable, and that major coal burners like TVA, NRG, Duke and Xcel expect to comply without undue cost or difficulty. Moreover, even in specific locations where a company’s decision to close plants could affect reliability, measures exist to address the problem.

“Congress has already provided the tools needed to ensure that implementation of regulations designed to protect public health do not end up in a clash with other critical objectives, such as reliable electricity supply,” Tierney stated. She cited as examples: EPA’s authority under the Clean Air Act to extend compliance deadlines for individual