|EPA’s New Rule Kills Coal, Makes Natural Gas King|
|BY ASHTON ELLIS |
THURSDAY, MARCH 29 2012
Move over, Steven Chu and the Department of Energy. The Environmental Protection Agency’s Lisa Jackson wants a crack at being the Obama Administration’s latest energy sector dictator.
Recently, Energy Secretary Chu distanced himself from remarks he made in 2008 that “somehow we have to figure out how to boost the price of gasoline to the levels in Europe,” so that Americans will be forced to switch to alternative energy. When asked during a Senate committee hearing two weeks ago whether he still believes that, Chu responded, “I no longer share that view.”
Yet a few days before he flipped in the Senate, Chu was still flopping on the side of using his governmental powers to limit consumption of gasoline. Under questioning from a House panel about making lower gas prices his top priority Chu retorted, “No, the overall goal is to decrease our dependency on oil.”
But with President Barack Obama’s approval ratings falling and gas prices spiking near $5 a gallon well before the usual summer demand surge, Chu needed to get out of the spotlight.
After all, Chu is the Energy Secretary who put taxpayers on the hook for the failed $535 million Solyndra loan, plus as many as nine other suspect loans that have been put on an internal watch list by an independent investigation into the Department’s handling of the $8.3 billion renewable energy finance program.
From his perch at the Energy Department Chu isn’t able to directly affect the price of gasoline. Instead, he uses the power available to him to reward green technology ideas that no private investor will touch. Call it venture crony capitalism with your money.
This week, the EPA’s Lisa Jackson upped the ante.
In a move that codifies into law Obama’s “we can’t wait” mantra, Jackson announced on Tuesday a sweeping new emissions rule that will effectively kill the coal industry by halting construction on any new plants.
Of course, the rule doesn’t specifically prohibit companies from building new coal plants. That would be, well, illegal. Instead, the stringent emissions caps hit coal plants harder than other energy producers because the technology for cleaning coal enough to meet the new standards is both prohibitively expensive and unproven.
For this reason, the EPA says, “Energy industry modeling forecasts uniformly predict that few, if any, coal-fired power plants will be built in the foreseeable future.”
EPA’s confidence in this prediction is simple. Implementing the new emissions rule will make operating a natural gas power plant much less expensive than using coal. Within a decade, coal operators will either switch to natural gas or go out of business. In one fell swoop, EPA has put the coal industry on a death march while driving investment toward natural gas.
The irony of EPA elevating natural gas at the expense of coal is breathtaking. Just last year, the Obama Administration was warning the public about contaminated ground water due to a new extraction method called fracking that blasts water into underground rock formations to release natural gas deposits.
But the greenies in the Obama administration ran into three problems. First, ground water contamination from fracking is minimal. Second, natural gas is a cleaner form of energy than coal or oil. And third, the amount of natural gas now recoverable thanks to fracking from shale rock alone is estimated to be 750 trillion cubic feet; which, when combined with other domestic supplies of natural gas is enough to supply America’s natural gas needs for more than 100 years.
Faced with Chu’s failure to fund alternative energy into existence, an inability to dictate gas prices and a glut of natural gas, Jackson did what ideologically driven bureaucrats do best – regulate a disfavored industry out of existence.
It may be that fracking has ushered in a “golden age of gas,” but EPA central planners can’t predict the future.
Nor should they be allowed to.
As energy analyst John Kemp points out, “Just seven years ago the [natural gas] industry was gripped by panic about gas production peaking and thought America stood on the brink of needing to import increasing quantities of expensive gas.”
Congress writes the laws and cuts the checks that give Chu, Jackson and their ilk power. It’s time to rein them in before entire an entire industry disappears by bureaucratic fiat.