You might have to, if the Environmental Protection Agency gets
its way in the U.S. Supreme Court on Tuesday.
The court will hear oral arguments in a case dealing with the
EPA's ability to regulate cross-state, or interstate, air
pollution. The lower court found EPA's rule, known as the
Cross-State Air Pollution Rule, illegal. So the EPA and various
environmental groups are now asking the Supreme Court to reverse
the lower court's decision. They argue that, if left in place,
the lower court's decision will "substantially delay
emissions reductions" and "thwart timely attainment of
the nation's health-based air quality standards."
But the truth is that the case has more to do with interstate cost
sharing and economics than it does with air quality improvements.
At stake are tens of billions of dollars in compliance costs, and
the question is which states will have to pay and how much.
EPA's rule regulated cross-state power plant pollution
pursuant to a short clause in the federal Clean Air Act, commonly
called the "good neighbor" provision. That provision
requires states to eliminate in-state air pollution that
significantly contributes to air quality problems in neighboring
states. For example, if the City of Chicago's air pollution is
significantly contributing to air quality problems in Wisconsin,
Illinois is required to eliminate that pollution. Otherwise,
Illinois is not being a good neighbor.
Although this sounds simple, it's not. EPA has tried for years
to regulate cross-state air pollution coming from power plants in
the eastern half of this country, and the courts have consistently
shot down EPA's attempts. The challenge for EPA is that the
more polluting states are not necessarily the states with the
cheapest plants to clean up.
For example, Illinois' power plants are more expensive to
clean up than Wisconsin's plants; yet Illinois sends more
harmful pollution to other states than Wisconsin does. Is it fair
to require Wisconsin's utilities and electric ratepayers to
spend more to compensate for Illinois' pollution, if society as
a whole is better off? EPA believes the answer is yes. As a citizen
of Wisconsin, I disagree.
EPA's rule set each state's emission reduction requirement
based on how much it would cost that state's power plants to
reduce air pollution. But the lower court found that EPA exceeded
its authority under the "good neighbor" provision because
the emission reduction requirements were not based on how much each
state is actually contributing to neighboring states' air
quality problems. EPA's rule was requiring states like
Wisconsin to be more than just good neighbors, and the lower court
said that was illegal.
The Supreme Court will now decide, and its decision could have
enormous economic impacts. On the low-end, EPA estimates an annual
cost to comply with the rule of about $2 billion, while the
non-partisan American Legislative Exchange Council estimates that
compliance costs will exceed $120 billion within the first few
years of implementation.
Under EPA's rule, Texas, South Carolina, New York, Wisconsin
and numerous other states would have to pay more than their fair
share so that other states can continue to pollute. On the flip
side, the states that are the largest contributors to downwind air
quality problems are Ohio, Illinois, Indiana, Missouri, West
Virginia and Kentucky. These states were relative winners under
EPA's rule because their contributions were offset by
reductions required in other states. If the lower court's
decision stands, however, EPA's next cross-state rule will
likely require these states to spend billions more on pollution
control technology. Residential and business consumers in the
states will face higher electric bills, thereby hurting the local
economies.
Regardless of which upwind states ultimately bear the cost, EPA
will use the "good neighbor" provision to try to fix all
downwind air quality problems. That's why this case is not
really about air quality; it's about who's going to pay to
improve it.
I, for one, don't want to pay more than my fair share. Do
you?
This article first appeared on The Hill.
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