Tuesday, March 15, 2005

EPA Limits Mercury Emissions

NewsHour with Jim Lehrer

The Environmental Protection Agency released the first regulations that limit mercury emissions from coal-fired power plants Tuesday. Two energy experts debate the implications of the new "cap and trade" initiative which allows companies to trade pollution allowances.

SPENCER MICHELS: With the new EPA rule announced today, the United States became the first country to regulate mercury emissions from power plants. The nation's 450 coal-fired power plants are the main culprits. They emit some 48 tons of mercury into the atmosphere each year. The new regulations aim to cut those emissions to 38 tons in five years, and to 15 tons by 2018. Environmental Protection Agency officials announced the new rules at a Washington press conference this afternoon.

JEFFREY HOLMSTEAD, Environmental Protection Agency: Mercury is emitted from power plants in different forms. About half of that mercury is oxidized mercury which actually can deposit locally and regionally and cause those types of concerns. And these rules are specifically designed to reduce that type of mercury the most.

SPENCER MICHELS: Under the new rule, the EPA will permit heavy polluters to choose whether to reduce their own emissions, or to buy credits from companies who don't pollute in order to meet the targets, a practice known as "cap and trade." In addition, states can also opt out and set their own, stricter emission levels.

JEFFREY HOLMSTEAD: A cap-and-trade approach enables the power sector to achieve these reductions more cost effectively, helping to ensure a steady flow of affordable electricity for American consumers and businesses. The mandatory declining emissions caps in the rules, coupled with very significant penalties for noncompliance, will ensure that mercury reduction requirements are achieved and sustained.

SPENCER MICHELS: Mercury naturally occurs in the environment, but many people are exposed to high concentrations of the metal by eating fish after mercury has settled into the air and water. Especially high levels accumulate in tuna and swordfish. The dangerous toxin can cause neurological damage in the developing brains of fetuses and young children.
The EPA's actions on the mercury rule have spurred intense criticism. Environmentalists and public health advocates say the new regulations don't go far enough and fast enough to reduce mercury emissions. In addition, the agency's own inspector general issued this statement last month. "We concluded that the EPA's rule development process for this case was inconsistent with expected and past EPA practices, including a failure to fully assess the rule's impact on children's health..."

This is the second action the EPA has taken in recent weeks to curb pollutants. Last week, the agency issued the Clean Air Interstate Rule, also known as CAIR, which is aimed at reducing sulfur dioxide and nitrogen oxide emissions from power plants in 28 Eastern and Midwestern states.

The EPA said the new CAIR rules and Mercury regulations comprised a multi-pollutant strategy to reduce emissions. The regulations were issued after the Bush administration failed to pass similar air pollution legislation in Congress known as the Clear Skies Act. That bill has stalled in a senate committee. The new mercury regulations are scheduled to go into effect in 60 days. But environmental groups have already vowed to challenge the new rule in court.

MARGARET WARNER: And for more on this new rule and the controversy over it, I'm joined by Scott Segal, director of the Electric Reliability Coordinating Council. Most of its members are coal- fired electric utilities and Frank O'Donnell, president of the environmental group Clean Air Watch. Welcome, gentlemen. So, Mr. Segal, it's your members who are going to be hit hardest by this rule. Are you ready? What do you think of it and are you ready to do what you have to, to make it work?

SCOTT SEGAL: Well, the rule is going to be a tough chore. I mean, any way you look at it, it is the first time ever mercury has been regulated from power plants. It - the rule calls for very deep cuts, 70 percent cuts in emissions by the final implementation of the second phase of the rule. That's significant any way you cut it. But we think the rule is good news and it's good news because a cap and trade program, which is what the rule calls for, is a more certain way, a better way, a more cost effective way and avoids the case by case litigation-heavy analysis which really is a threat to the energy diversity of this country, the energy security of this country and the continued use of coal. Coal is 55 percent of U.S. electric generating capacity; it's important to keep it viable. It's a domestic resource. It's important to keep it viable in our economy.

MARGARET WARNER: All right. And, Mr. O'Donnell, most environmentalists don't like this but to someone sitting at home listening to this, they'd say 70 percent cut. That's pretty big. Make your case for why this isn't enough.

FRANK O'DONNELL: Sure, Margaret, thanks again. One of the reasons is that this rule allows too much mercury in the air for too long. Mercury is a very toxic substance; it is a real threat to pregnant women and to the unborn as some people would call them fetuses, certainly. And the real story here is that a child born today would be in college, assuming the mercury didn't mess up their brain and make it hard for them to learn, before this rule finally takes effect.
The story here is that it will be a 70 percent reduction. But the EPA's own analyses show that won't happen until around the year 2026. What we really have here is a delay that goes way into the future, allows far too much mercury into the system, something that will poison the brains of babies. It's unconscionable.

We can clean up mercury in the next three or four years-we can clean up probably 80 to 90 percent of the mercury in that time if we simply enforce the current law and tell the power companies to clean up. The Bush administration doesn't want to enforce the law, tried to rewrite the law as your piece noted. They failed to do that; now they're trying to ignore the law. And it's not just environmental groups and health groups that are upset. State agencies, state environment protection officials are absolutely livid about this. They think this undermines their attempt to protect the public and they're very upset.

"Cap and trade" reduction programs
MARGARET WARNER: Why not do this more rapidly, Mr. Segal? Thirteen years is a long time.
SCOTT SEGAL: Well, first of all, one thing you need to know about a cap and trade program is when you set up that type of trading program, there is a substantial incentive to make early reductions in mercury emissions well before the full implementation of the cap.
MARGARET WARNER: Now, let me stop you right there. Let's just explain - a cap and trade program is basically a company that owns many power plants could say, okay, we're going to clean up these five and maybe not clean up these other five which would be more expensive but then the clean ones, they can kind of trade that, I don't know what the term of art is, in return for having the dirty ones, is that right?

SCOTT SEGAL: It's almost right. Let me just give it a little bit of a different cast. If you had ten power plants under a cap and trade program, you would clean up all ten of those power plants. But for some, let's say five of them, you couldn't quite meet the goal, and for the other five you exceed the goal. To the extent that you exceed the goal, you can trade the amount of pollution that you exceed the goal and you can trade it to a plant that does not quite meet the goal.
Why not have faster reductions?

MARGARET WARNER: So answer Mr. O'Donnell's question. Why couldn't you do this a lot more rapidly even under cap and trade?

SCOTT SEGAL: Well, two reasons. The first is cap and trade does cause rapid change because as soon as you set up the cap and trade program, you can start to make those trades and it creates a substantial financial incentive to have early reductions in mercury. But the second point, the reason you don't want to mandate it right from the get go or in three years as Frank has suggested, the technology is simply not there.

We hear arguments time after time again that folks that make pollution control equipment will tell you oh, we could help you get down to 90 percent reduction. But when we ask those manufacturers, will you guarantee that you can actually get a 90 percent reduction? They say no, we won't put on it paper. We won't guarantee it. And the reason is the technology that Frank refers to has not been demonstrated across all configurations of power plants and for all coal types. And so you might be mortgaging 55 percent of U.S. electric generating capacity. It's not responsible.

FRANK O'DONNELL: Well, I think we ought to avoid some of the scare tactics and try to not scare people. We are going to continue to burn coal. The question is: Are we going to clean it up so it doesn't poison the brains of babies? And I've got to say, you know, this administration has made a great point about talking about moral issues and talking about the unborn and things like that. Here is a case where they are turning their back on moral issues. They're turning their back on babies. And I think I know why. Babies don't make big campaign contributions; big energy companies do.

MARGARET WARNER: All right. Let's go back to the effectiveness instead of the politics, if we could. Are you troubled by the fact that there is not an equal standard set on all power plants? In other words, under cap and trade, that you can have some plants that the company decides they can't quite make the standard and others don't.

FRANK O'DONNELL: Absolutely because the result of this is that in some areas, residents are going to still have polluted waters. They're still going to have toxic fish. Look, we have got literally 45 states in this country have put out advisories saying there is so much mercury in the fish, we don't want you all to eat much of it because it will poison you and it may threaten your babies. We ought to be able to clean up all those 45 states, not just let some of them clean up and let others of them still have a problem.

SCOTT SEGAL: But everyone agrees that mercury is a neurotoxin and ought to be reduced. The only question here is: what is the best way to reduce mercury emissions? The best way is a cap and trade program because we talk about certain areas that might have greater exposure to mercury. The fact is that when we implemented a cap and trade program back in 1990 to address acid rain we saw the facilities that emitted the most of the emission we were targeting had the greatest incentive to reduce the fastest. So these programs like today's mercury rule brings relief to the areas that need it the most the fastest. That is the ample historical record of cap and trade. So if you are very concerned about the neurotoxicological effects of mercury, the best thing to do is to support a cap and trade program like this regulation.

Impact on public health
MARGARET WARNER: Let me ask you about something, Mr. O'Donnell, that the EPA fellow mentioned in his press conference. He said, you know, most people are still getting their mercury in their bodies. You don't really get it from the air. You get it from mostly fish.


MARGARET WARNER: Most of the fish sold in this country, not caught but sold, comes from overseas and there are no controls at all. Even if there this were to go to 80 percent, is this going to really have a measurable effect on people's health?

FRANK O'DONNELL: Sure. Mount Sinai Hospital did a study just last week that came out and said that the power plants in this country are causing more than a billion dollars in health damage in this country. So if we take aggressive action against our own power companies, not only will we be setting a standard that the rest of the world ought to be able to emulate but we will be protecting our own people. Just because that some of the pollution comes in from overseas doesn't mean we shouldn't clean up what we can clean up. We can't cap volcanoes but just because people in Bangladesh don't get paid much, we shouldn't abolish the minimum wage in this country. What we need to do is take care of our people, take care of the women, pregnant women and children. And we can make aggressive strides to really help it and clean up some of these--

MARGARET WARNER: But Americans will still be warned not to eat things tuna and swordfish if they're at risk, for a long time.

FRANK O'DONNELL: But if this plan holds and I think it will be overturned in court because it is flatly illegal, if this plan holds, those warnings will continue many more years than they should.

SCOTT SEGAL: What Frank is not telling the listener is that only a tiny percentage of the mercury load comes from the power plants in the United States. The vast majority of it comes from sources like -- sources in China and Korea where we have that type of manufacturing facility.

MARGARET WARNER: Last quick question. There was some suggestion today that electricity rates will rise as a result of this. Will they and by how much?

SCOTT SEGAL: Well, there is no doubt that the less flexible the mercury rule is....

MARGARET WARNER: Now, but let's deal with this mercury rule. We only have a second.

SCOTT SEGAL: I understand. The less flexible we implement the rule, the tougher that Frank's group tries to make the rules through court actions, the more difficult it will become to keep diverse fields in the marketplace and the tougher it will be for those living on fixed incomes like the elderly and those living at or near the poverty level.

MARGARET WARNER: But my question is: If this rule went into effect and he had no success in court, can you say now whether electricity rates will rise and, if so, by how much?

SCOTT SEGAL: Well, we do believe that there will be substantial economic impact associated with the rule. $50 billion in compliance cost. How much that translates directly to electricity rates, it's very hard to say.

FRANK O'DONNELL: This rule won't require any mercury specific cleanup until at least 2018 so there can't possibly be an impact on electricity rates.

MARGARET WARNER: All right. Gentlemen, we have to leave it there but we'll know by 2018. Thank you both.



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