New EPA Rules Mean Higher Costs, Lost Jobs and Less for the Average Family to Spend
Four new rules from the Environmental Protection Agency would further regulate the operation of coal-fueled power plants. The most expensive of these is called the Utility MACT rule. We asked National Economic Research Associates (NERA), an independent research firm, to model the potential economic impact if all four rules are implemented. Using data from many sources, including the EPA itself and the U.S. Energy Information Administration, its models paint a very sobering picture.
Every family will lose an average of $270 a year of disposable income through 2020 under these new rules.
The Impacts of the Cross-State Air Pollution Rule, Coal Combustion Residuals, Rule 316(b) and Utility MACT Rule.
The costs for compliance are immense. The Utility MACT Rule alone comes with a cost of $11.4 billion in 2015, making it the most expensive regulation the EPA has written for coal-fueled power plants. Add in the replacement of lost capacity due to the premature retirement of certain plants, the energy sector will pay $127 billion from 2012 — 2020.
Higher compliance costs inevitably mean higher rates. Regions covering all or part of 30 states plus the District of Columbia will experience peak-year increases that will exceed 10 percent, with some as high as 19 percent.
The progression is clear. Higher costs lead to higher rates, which lead to fewer jobs. Nationwide, net loss will be 1.65 million jobs between 2012 and 2020. And those numbers account for jobs created in some sectors by the new regulations.