EPA Regulations Wreak Havoc on Ohio Coal, Electric Companies
The Utility Maximum Achievable Control Technology (MACT) rules imposed by the U.S. Environmental Protection Agency (EPA) are taking a toll on Ohio’s coal industry and are expected to increase citizens’ electricity costs. Utility MACT, a series of bureaucratic regulations created under the Clean Air Act with the support of President Obama and U.S. Senator Sherrod Brown (D-OH), has already caused coal-fired plant closures and layoffs.
Even as natural gas production ramps up in the state, the fact that 82 percent of Ohio’s electricity is generated using coal suggests Utility MACT will also increase energy costs statewide. Natural gas prices paid by utility companies hit a 10-year low of under $2 per million British thermal units in April 2012, but Reuters reported on October 24 that prices have risen substantially as national production has flattened and an expected cold winter approaches.
American Electric Power, which is headquartered in Columbus and has 5 million customers in Ohio, announced in June 2011 that it planned to shutter plants in response to Utility MACT. “Among the sites that would close is the Picway plant south of Columbus; plants in Conesville and Beverly would partially close. The net job loss for the state would be 157,” The Columbus Dispatch reported.
The Dispatch quoted a statement from the EPA which read, “These reasonable steps taken under the Clean Air Act will reduce harmful air pollution, including mercury, arsenic and other toxic pollution, and as a result protect our families, particularly children.” Refer to Ohio Watchdog for a detailed explanation of EPA’s bizarre rationale for the rules included in Utility MACT.
Duke Energy announced on July 15, 2011 that it would close the W.C. Beckjord plant near Cincinnati by January 1, 2015 due to Utility MACT. A company release indicated some workers may be relocated to other Duke Energy plants, but up to 120 jobs will be lost when the coal-fired plant closes.
On January 6, 2012, the Dayton Daily News reported that a Dayton Power & Light plant with 50 employees may close as a result of the new regulations, depending on the outcome of a study into the feasibility of converting the facility for natural gas.
“Ohio utilities are facing the dilemma of closing plants versus refitting them following EPA rules issued in December,” reporter Steve Bennish added. “With an estimated $9.6 billion price tag, the rules rank among the most expensive in the EPAs history. Utilities have until 2015 to 2016 to comply.”
“Lacking an energy bill from Congress, the Obama administration plans to attack climate change and boost the emerging renewable energy industry with stepped-up regulations,” Bennish wrote in a Springfield News-Sun story published two weeks later.
At the end of January, the Akron Beacon Journal reported that Utility MACT would cause Akron-based FirstEnergy to partially or completely shut down operations at four Ohio plants by September 1, 2012, resulting in as many as 529 layoffs.
The Beacon Journal reported in May that FirstEnergy had delayed most of the closings until 2015 after the company managing the region’s high-voltage grid warned, “FirstEnergys initial closure plan would cause major voltage inadequacies and equipment problems affecting the multistate regional grid.”
A February 2 Associated Press story opined that there was a silver lining to the EPA regulations – at least from the perspective of FirstEnergy and other electrical plant operators. “With the closure of four plants in Ohio, there will be less power available to meet demand. That is expected to drive prices for capacity higher,” Jonathan Fahey wrote.
In February 2012, GenOn Energy announced several pending coal-fired power plant closures in Ohio and Pennsylvania. A plant in Niles, Ohio employing 40 workers would close in June, prompting Niles Mayor Ralph Infante to tell the local Tribune Chronicle, “It’s a shame. Everyone feels the impact from the EPA mandates.”
The Tribune Chronicle also reported that the city had increased electricity rates two years earlier after EPA regulations prompted to closure of another nearby plant, adding that surrounding cities were still paying for the plant closed in June 2012.
A GenOn coal-fired plant in Avon Lake is scheduled to close in April 2015, taking nearly 80 jobs with it. “The Avon Lake plant was determined to be the countys biggest greenhouse gas polluter in 2010, when it emitted about 2.4 million metric tons of greenhouse gas, mostly carbon dioxide, according to the federal EPA,” The Chronicle-Telegram in Elyria reported.
Citing a combination of increased competition from natural gas and the burden of EPA regulations, a subsidiary of Murray Energy laid off 29 employees of a Belmont County coal mine in July 2012.
In neighboring West Virginia, where mine layoffs have been more pervasive, the unintended consequences of Utility MACT are already creating a ripple effect among Appalachian small businesses reliant on miners’ patronage to stay afloat.