EPA sticks it to New Mexico electricity users

The US EPA has made its decision; it will NOT be rational, nor will it follow its own guidelines. Instead, it is going to force costly new haze controls on the San Juan Generating Station.

Read the following article on the situation from William Yeatman, an energy policy analyst at the Competitive Enterprise Institute,

The Environmental Protection Agency (EPA) is poised to run roughshod over New Mexico officials and impose nearly $340 million in unjustified costs on PNM customers—in blatant disregard of its own rules. At issue is a provision of the Clean Air Act, known as “Regional Haze.” Unlike other parts of the Act, which are meant to protect public health, the Regional Haze provision is an aesthetic regulation, intended to improve the view at national parks.

Under New Mexico law, the state cannot impose Regional Haze emissions controls that are more stringent than what the federal government requires. In 2005, the EPA published Regional Haze guidelines that established recommended emissions controls to comply with the visibility regulation. These recommendations are known as “presumptive limits.” On June 2, the state Environmental Improvement Board (EIB) unanimously approved a Regional Haze plan that would meet the EPA’s “presumptive limits” by spending $34 million to retrofit the San Juan Generating Station, a coal-fired power plant located 15 miles west of Farmington.

Despite comporting with both federal guidelines and state law, these controls weren’t good enough for the EPA. Perhaps this has something to do with President Barack Obama’s campaign promise to “bankrupt” the American coal industry. Whatever its rationale, the EPA is proposing Regional Haze retrofits at San Juan that would cost New Mexico ratepayers $370 million—a nearly ten-fold increase over those approved by New Mexico officials.

And what does this huge sum buy? Not much. Based on peer-reviewed research, there is a 35 percent chance that the visibility “benefit” of the EPA’s preferred controls could be perceptible by the general population on the seventh worst visibility day of the year at Mesa Verde, the National Park closest to the San Juan Generating Station. In other words, most people won’t even notice the difference wrought by the EPA’s ultra-expensive controls.

But New Mexicans certainly will notice the difference in their utility bills! PNM estimates that the EIB-proposed controls would result in a rate increase of $12 a year, while the EPA-proposed controls would increase rates by $82 a year—almost seven times more. In these tough economic times, New Mexicans should not be forced to pay hundreds of millions of dollars in exchange for imperceptible benefits.

If the EPA decides to reject the EIB’s plan, and impose its own, the administration of Governor Susana Martinez would have a strong case in court, thanks to the unique discretion afforded states in deciding how to protect visibility under the Clean Air Act. According to the EPA’s own Regional Haze guidelines, “Congress evinced a special concerning with insuring that States would be the decision-makers.” If the EPA chooses to ignore that fact, New Mexico should remind it in court.