Experts: New EPA rule will not overcome 'market forces,' revive coal industry

“We are here today because the American public elected a president with a better approach. And today, we are fulfilling his directive,” EPA Administrator Andrew Wheeler, a former coal lobbyist, said Wednesday at a live-streamed announcement.

Wheeler said he expects to see CO2 emissions drop by “as much as 35 percent below 2005 levels,” once the rule is implemented.

“Yeah, because natural gas is cheap and it’s plentiful and wind and solar are now more cost-effective than coal, so the decarbonization is happening,” said James Van Nostrand, professor of law and director of the Center for Energy and Sustainable Development at the West Virginia University College of Law. “If anything, it’ll result in increased greenhouse gas emissions. In terms of the economics of a coal plant, it makes no difference whatsoever. No utility is going to build a new coal plant.”

Julie McNamara, senior energy analyst at the Union of Concerned Scientists, called the new rule a “light touch” with large loopholes.

“This will not change the market trend of coal plant retirement,” she said. “But for those laggard states not participating in this transition underway, this will lessen any need to limit emissions from the power sector.”

At the announcement Wednesday, members of West Virginia’s congressional delegation applauded the new rule and disparaged the Obama administration’s Clean Power Plan.

“Whether people like it or not — some of the extremists in Congress and around the country — coal is crucial,” said Rep. David McKinley, R-W.Va.

In a statement, Sen. Shelley Moore Capito, R-W.Va., applauded the EPA for working toward “ending the War on Coal.”

“The Obama administration’s so-called ‘Clean Power Plan’ was an unrealistic and strangling regulation that was devastating to West Virginia’s energy economy,” she said.

“Thanks to the commitment and support from this administration, my district, which was so devastated by Obama’s war on coal, is finally bouncing back. Several of our mines are reopened and our miners are working again,” Rep. Carol Miller, R-W.Va., told the room.

That likely won’t happen, Van Nostrand said. Natural gas is still too cheap and plentiful, and continues to dominate.

“It’s just that the whole state has been sold a bill of goods, because the EPA didn’t kill the coal industry,” he said.

Natural gas is expected to remain inexpensive and a significant export, according to the U.S. Energy Information Administration’s 2019 Annual Energy Outlook. Coal production will continue to decline in response to plant retirements and “competitive price pressure from natural gas and renewables.” Industry consumption will increase between 2018 and 2050 across the energy sector — excluding coal, which will decline, the report predicts.

Last week’s short-term energy outlook from the EIA predicts that electricity generation from coal — 27 percent in 2018 — will dip to 24 percent in 2019 and 23 percent in 2020. Meanwhile, CO2 emissions will decline in 2019 and 2020 as electricity generated from natural gas and renewables increases and coal decreases, the report says.

States now have three years to submit plans under the new rule. The West Virginia Department of Environmental Protection did not respond to questions about how it plans to act.

The EPA first proposed the rule last August, right before President Donald Trump was scheduled to appear at a rally in Charleston. He was stumping for Attorney General Patrick Morrisey, who ran against Sen. Joe Manchin, D-W.Va., for his Senate seat and lost. Morrisey was among a group of attorneys general to challenge the Clean Power Plan in the U.S. Supreme Court, where it ultimately was stayed.

Although the new rule likely will be challenged in court, Van Nostrand said he thinks it stands on firm legal ground.

“I don’t see anyone having any success in challenging this.” he said. “Elections have consequences; the president’s doing what he said he was going to do.”

The impact of the rule might be negligible, Van Nostrand said, but it sends a signal to the rest of the world: “We don’t care about greenhouse gas emissions reductions. We care about trying to bail out the coal industry,” he said. “There isn’t enough money to bail out the coal industry. The market forces are just so overwhelming.”