Monday, March 14, 2011

WSJ: EPA tangles with a new critic: labor

Several unions with strong influence in key states are demanding that the EPA soften new regulations MARCH 14, 2011  By STEPHEN POWER

WASHINGTON—The Obama administration's environmental agenda, long a target of American business, is beginning to take fire from some of the Democratic Party's most reliable supporters: Labor unions.

Several unions with strong influence in key states are demanding that the Environmental Protection Agency soften new regulations aimed at pollution associated with coal-fired power plants. Their contention: Roughly half a dozen rules expected to roll out within the next two years could put thousands of jobs in jeopardy and damage the party's 2012 election prospects.

"If the EPA issues regulations that cost jobs in Pennsylvania and Ohio, the Republicans will blast the President with it over and over," says Stewart Acuff, chief of staff to the president of the Utility Workers Union of America. "Not just the President. Every Democratic [lawmaker] from those states."

A range of American companies that depend on fossil fuel—from coal and oil firms to manufacturers—have complained about the Obama EPA, one reason the administration has had tense relations with business. In meetings in recent days, representatives of electric power utilities that rely heavily on coal-fired plants, and some large unions, have taken their concerns to the White House. The companies and the unions have said a new regulation targeting mercury and other toxic pollutants, due to be proposed this week, could lead to higher electric bills, billions of dollars in new costs and the closing of plants that employ thousands of workers.

Now that labor unions are joining the chorus, the pressure on the agency is intensifying. Some Democrats, worried about potential job losses in industrial states, are already urging the EPA to slow down its push to combat climate change.

EPA officials say such criticisms are premature, since some of the rules in question have yet to be proposed, and that history shows the benefits of tougher environmental rules greatly outweigh the costs.

But on some issues, the EPA has begun to slow the pace of its efforts, saying publicly that it needs more time to consider the science behind them or review comments from affected groups.

EPA Administrator Lisa Jackson, or her top aide on air quality, Regina McCarthy, has recently spoken with representatives of several unions that collectively have given tens of millions of dollars over the years to Democratic candidates. Among them: the International Brotherhood of Electrical Workers, the International Brotherhood of Boilermakers, the Utility Workers Union and the United Mine Workers.

The EPA rule stirring the most anxiety will be proposed this week: It seeks to reduce emissions of toxic air pollutants, including mercury, which can cause neurological disorders in children.

An analysis by the miners' union says the proposal, along with others targeting coal-related pollution, could put at risk as many as 250,000 jobs. Many of those would come from the utility, mining and railroad sectors, with the heaviest impact falling on Rust Belt states that have many old coal plants—and electoral votes.

"These are the same doomsday scenarios we hear whenever we take steps to protect Americans from dangerous air pollution," responded EPA spokesman Brendan Gilfillan. He said it's too early for the union to calculate possible job losses. A study released by the agency this month said EPA regulations put in place between 1990 and 2005 and aimed at reducing soot and smog will yield $2 trillion in benefits in 2020, largely from fewer premature deaths.

"I think we have a really solid history of doing the rules in a way that makes sense," said Ms. McCarthy, the agency's assistant administrator for air and radiation. A White House spokesman says any proposed regulation will be consistent with a recent presidential order directing agencies to "consider regulatory approaches that reduce burdens and maintain flexibility" while still protecting public health.

Companies that stand to benefit from tougher curbs on emissions from coal-fired power plants, including utilities that have invested heavily in wind, solar power and nuclear, are pushing the White House not to weaken the rules.

Chief executives of utilities that support stronger standards for coal-fired plants, including Baltimore-based Constellation Energy Group Inc., Florida-based NextEra Energy Inc. and Chicago-based Exelon Corp., the nation's largest owner of nuclear-power plants, met last week with White House Chief of Staff William Daley.

These companies, and some unions that see the rules as a potential economic catalyst, say that the industry has had years to prepare for tougher regulation and that the rules will generate jobs for workers who make, install or operate pollution control equipment.

Under President Barack Obama, the EPA has been one of Washington's busiest agencies. Responding to a 2007 Supreme Court decision, Ms. Jackson has invoked the Clean Air Act to regulate carbon dioxide and other gases linked to climate change. Those moves have prompted lawsuits from the U.S. Chamber of Commerce, the National Association of Manufacturers and other industry groups.

Ms. Jackson has also sought to tighten regulations covering traditional pollutants associated with coal. Some of her proposals have come in response to federal court decisions that invalidated regulations set under President George W. Bush.

Nevertheless, the EPA has slowed its timetable for action on some issues in recent months. Ms. Jackson late last year delayed a decision on whether to tighten the government's limits on ground-level ozone, a primary ingredient in smog. A coalition of labor groups including Boilermakers, Mine Workers and Utility Workers warned her in a letter that tightening the standard would lead to "significant job losses across the country." A group of Democratic senators from Missouri, Indiana and Louisiana said in their own letter such a move would "have a significant negative impact on our states' workers."

Ms. Jackson has said she delayed her decision not in response to pressure, but to ensure the regulation is grounded in "the best science."

Last month, the EPA unveiled a scaled-back version of regulations it proposed last year targeting emissions of pollutants from industrial boilers after being deluged with letters and comments.

The United Steelworkers said in an August letter that "tens of thousands" of jobs at factories whose employees are represented by the Steelworkers "will be imperiled" by the rule, along with other related jobs.

A spokeswoman for the Steelworkers says the union hasn't fully assessed the new version of the rules. "We've been trying to work with the get to a place where the rules are a bit more mindful of the costs," says Roxanne Brown, the union's assistant legislative director.

The EPA said the rules will avert up to 6,600 premature deaths in 2014, while costing affected industries $2.1 billion a year, about half the cost of its initial proposal.

Not all unions take a dim view of the EPA's moves. William Hite, general president of the United Association of Plumbers and Pipe Fitters, says that while his union is "certainly concerned" about the potential for job losses, the mercury rule could also create thousands of jobs for workers who build and install pollution control equipment.

At the same time, a delicate alliance has emerged between the unions and companies wary of the EPA. In February, representatives of the Boilermakers union and the IBEW met in Washington with Mike Morris, the CEO of American Electric Power Co. AEP, of Columbus, Ohio, is one of the nation's top coal burners and stands to be among the companies hardest hit by tougher EPA rules.

In January, Mr. Morris met with the president of the IBEW, Ed Hill, and the new chairman of the House Energy and Commerce Committee, Fred Upton, (R., Mich.).

Rep. Upton, who has introduced legislation to strip the EPA of its authority to regulate greenhouse-gas emissions, said in an interview that AEP's Mr. Morris requested the meeting, and that the three discussed concerns about the impact of new EPA regulations.

The unions lobbying the EPA are longtime Democratic Party supporters. Through its employees and political action committee, the IBEW has given $32.9 million to federal candidates and political parties since 1989, according to the Center for Responsive Politics, a Washington-based group that tracks campaign donations.

Nearly all of that money went to Democrats, according to the center, which ranks the union as the seventh-biggest "heavy hitter" on a list of the 100 biggest givers in federal politics.

Mr. Obama's relationship with organized labor, however, has been uneven.

He initially lent his support in recent fights with Republican governors over public-sector collective bargaining, but avoided plunging into the fray.

And while Mr. Obama has made many pro-union policy decisions and appointments, some union leaders remain disappointed that the White House didn't push harder for the "Employee Free Choice Act," a bill that would have made it easier for unions to organize.

All this could come into play in 2012. Nine states Mr. Obama won in 2008—home to more than a fifth of Electoral College votes and a third of the country's greenhouse-gas emissions from coal-fired power plants—replaced Democratic statewide officeholders with Republicans in 2010. Four of those states have Democratic senators facing reelection in 2012, including Ohio, which relies on coal for more than 80% of its electricity.

Greg Haas, a Democratic political strategist based in Columbus, and Jerry Austin, a Democratic political consultant based in Cleveland, say EPA regulations could determine which presidential candidate wins Ohio's critical electoral votes.

"Environmental issues aren't going to be the No. 1 issue on the table, but they're going to be a factor with enough voters that in a tight election, it can tip the scales." Mr. Haas said.

Mr. Haas said that while labor leaders would still support Democrats in next year's races, the EPA's actions could complicate the unions' efforts to generate enthusiasm and turnout among members.

In the House, senior Democrats on the chamber's Agriculture and Transportation committees recently endorsed legislation to block EPA regulation of greenhouse gases. In the Senate, a group of Democrats led by Jay Rockefeller of West Virginia has introduced legislation that would forbid the EPA for two years from regulating greenhouse gases from power plants, and other stationary sources.

Among those pushing the measure: Missouri's Claire McCaskill. Ms. McCaskill, a Democrat who is facing reelection next year, was among the senators who also complained in a joint letter last year about the EPA proposal to tighten the definition of unhealthy ozone levels.

"The people in my state want clean air and clean water, but farmers and businesses in our state don't want nonsensical regulations that harm their ability to make a living," Ms. McCaskill said in an interview.

The EPA has said tightening the standard would save thousands of lives and is "long overdue."

The pending EPA proposal to limit mercury emissions stems from a long-running struggle between public-health groups and America's coal industry. Coal-fired power plants aren't currently subject to federal controls on their mercury emissions. Each year, they emit about 48 tons of mercury, a toxic element.

Under President Bill Clinton, the EPA declared in 2000 that mercury emissions from power plants pose "significant hazards to public health" and must be reduced. During the George W. Bush administration, the EPA established a national cap for mercury emissions and permitted power plants running on coal or oil to purchase credits from less-polluting plants.

In 2008, a federal court said the EPA's approach violated a requirement of federal law that power plants be outfitted with the best available antipollution technology.

The EPA's Ms. Jackson, in response, began drafting a rule expected to give power plants three years to meet standards for mercury and other hazardous air pollutants. Owners would have to choose between buying new pollution equipment, switching to cleaner fuels or retiring the plant.

The EPA's supporters say the new regulation will level the playing field between companies that have invested in pollution controls and those that haven't. The agency and its supporters also predict the rule will create jobs.

"It will be the biggest public-health achievement of the Obama administration," says John Walke, an attorney for the Natural Resources Defense Council.

But a report last September from bank Credit Suisse said the mercury rule, along with another regulation in the works targeting sulfur dioxide and nitrogen oxide, could lead to the closure of nearly 18% of the nation's coal-fired generation capacity, mainly facilities more than 40 years old that lack emissions controls.

Unions, which have many members in Michigan, Ohio, Indiana and Pennsylvania, want the EPA to base the new standards on the performances of different coal types. Many coal plants in the eastern U.S. rely on bituminous coal, which when burned emits higher levels of acid gases than sub-bituminous coal, commonly found in western states. The unions' approach would mean a slower timetable for reducing emissions, a trade-off many environmentalists are reluctant to accept.

"We understand they have a legal obligation" to issue the rule, says Mr. Acuff, chief of staff of the utility-workers union. "But they also have an obligation to make sure that these regulations don't hurt the administration and workers."

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