Kansas, Texas Lead States Challenging EPA Cross-State Rule

Published September 26, 2011

Kansas and Texas are leading a group of eight states suing the U.S. Environmental Protection Agency over EPA’s planned implementation of the Cross-State Air Pollution Rule. The Cross-State rule will impose costly new restrictions on power plants in 27 states. EPA argues the new restrictions are necessary for states not targeted by the new rule to meet federal air quality standards. 

Kansas and Texas filed suit on Sep. 21, with six other states filing suit by Sep. 26. Analysts expect other states to file against EPA during the weeks ahead.

Little Time to Adjust

EPA finalized the Cross-State rule on July 6 of this year, and it is scheduled to take effect on Jan. 1, 2012. According to the lawsuits, EPA’s new standards are based on faulty science and are being implemented too rapidly, with power plants in affected states not being allowed sufficient time to come into compliance with the new rule.

Additionally, Texas objects that when EPA belatedly added Texas to the list of states subject to the new rule, the agency did not provide sufficient notice and opportunity for affected parties to respond. 

Severe Economic Harm

The states also note the new restrictions will force power providers to implement expensive new technology, purchase power from out-of-state sources, and shut down existing plants. As a result, consumers will have to pay higher electricity prices and run the risk of being exposed to rolling blackouts during peak demand periods.

The Brattle Group economic consulting firm estimates the Cross-State rule could cost consumers up to $120 billion and reduce the nation’s power supply by almost 4 percent. 

The North American Electric Reliability Council (NERC), a nonprofit organization charged by the Federal Energy Regulatory Commission to ensure the reliability of the nation’s electric transmission grid, estimated the Cross-State rule could idle up to 10 percent of the nation’s electric power supply. 

The impact will be especially severe in Texas because of the type of coal used in some power plants in the state. The Electric Reliability Council of Texas (ERCOT) reports as much as 6,000 megawatts of power could be lost.

Reinforcing ERCOTs analysis, Luminant, the largest electricity supplier in Texas, has announced that in January it will close down two coal-fired boilers and three lignite mines that supplied them with fuel. This will result in a loss of 500 high-paying jobs.  

Just One Monitor Cited

“From 1999 to 2009, total point source SO2 emissions in the state of Texas have decreased by 44 percent,” the Texas Commission on Environmental Quality (TCEQ) observed in a statement explaining the state’s position.

“EPA’s justification for including Texas in this rule lies with a single linkage to a monitor in Granite City, Ill., a monitor that has been in attainment of the PM2.5 standard since 2009,” TCEQ explained. “Further, EPA’s own modeling for 2014 predicts this monitor will attain the [new] standard in 2014, without any additional reductions required.”

“EPA’s own data showed Texas power plant emissions have no negative impact on downwind states,” TCEQ chairman Bryan Shaw observed on the TCEQ Web site. “Therefore, EPA’s decision to include Texas in the PM2.5 portion of the rule is not based on sound science and will result in additional federally mandated regulation of Texas’ SO2 emissions that are not necessary for public health protection, and only result in negative consequences.”

“EPA’s justification for this rule that undermines the integrity of the electric power supply in Texas is thin as air,” said Kathleen Hartnett White, former TCEQ chairman and current director of the Armstrong Center for Energy and the Environment at the Texas Public Policy Foundation. “EPA concludes that Texas should reduce SOX emissions by 47 percent within a few months because of the possibility that emissions from Texas power plants might influence one monitor in Madison County, Illinois—a monitor that currently shows attainment of the air quality standard in question.” 

H. Sterling Burnett, Ph.D., ([email protected]) is a senior fellow with the National Center for Policy Analysis.