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US EPA's mercury proposal ignores science, actual compliance costs, critics say

The U.S. Environmental Protection Agency's bid to rescind the legal basis for an Obama-era rule targeting mercury emissions from coal- and oil-fired power plants ignores new science and lower-than-previously-estimated compliance costs, critics argued March 18.

The comments were delivered at the only public hearing for the EPA's December 2018 proposal to revoke the legal justification for the Mercury and Air Toxics Standards, or MATS, rule.

The standards, which in effect forced older coal plants to install modern pollution controls or retire, have coincided with a nearly 82% reduction in mercury emissions from the power sector since they were introduced in 2011. Top EPA officials repeatedly have stressed that the agency is not proposing to rescind the MATS rule altogether. However, it did propose to revoke the Obama administration's finding that regulating power plants for mercury emissions was "appropriate and necessary" under Section 112 of the Clean Air Act, prompting legal observers to speculate that doing so could allow opponents to challenge the standards themselves.

At issue is how the EPA weighed the regulation's public health "co-benefits" in a 2016 supplemental finding issued in response to a Supreme Court ruling that held the agency failed to adequately consider cost. That finding included a cost-benefit analysis based on the EPA's 2011 regulatory impact analysis, which estimated total annual compliance costs at $9.6 billion compared to $37 billion to $90 billion in annual public health benefits.

Most of those benefits are considered co-benefits because they are attributable to a reduction in fine particles and sulfur dioxide emissions, which are regulated under a different section of the Clean Air Act, with only approximately $4 million to $6 million in annual benefits directly related to mercury cuts.

'Excessively constrained approach'

Instead of defending the 2016 "appropriate and necessary" finding against a pending legal challenge in federal appeals court brought by Murray Energy Corp., the Trump administration has proposed to find that the determination was "flawed" because the cost of compliance "dwarfs" the monetized benefits of mercury emission cuts.

But the EPA's December 2018 proposal failed to account for new cost-benefit information, Hayden Hashimoto, a legal fellow with the Clean Air Task Force, asserted March 18.

Hashimoto noted that more recent analyses have shown the annual monetized benefits of mercury reductions from MATS to be in the billions, rather than millions, of dollars — a 2017 Harvard University study put the societal cost in the U.S. of neurocognitive damage due to mercury exposure at $4.8 billion per year. He also said the actual cost to the utility industry of MATS compliance in 2015 was $2 billion, or far less than EPA's original $9.6 billion estimate for that year.

"Even under EPA's excessively constrained approach, this small subset of the benefits justifies the actual implementation cost of the regulation," he said. Hashimoto was joined by groups including the Sierra Club, Earthjustice, and the Environmental Defense Fund in testifying against the proposal.

In contrast, Tawny Bridgeford, deputy general counsel at the National Mining Association, said the EPA was right to use the cost-benefit analysis that was required "at the outset" of the EPA's original rulemaking. And Cody Nett, assistant general counsel for Murray Energy, went further by stating the company was "extremely disappointed" the EPA has proposed to leave the MATS rule intact. "We urge EPA to take the only reasonable action flowing from its repudiation of the legal basis for MATS, and rescind the rule immediately," he said.

Joseph Goffman, senior legal counsel in the EPA's Office of Air and Radiation for the Obama administration, said he expects environmental and public health groups to submit written comments that call attention to the latest mercury science and compliance costs. "The fact that they're arguing their statutory interpretation is more reasonable than others' will probably force them to defend, and in a way that's not particularly advantageous, the proposition that they can ignore the more recent science," he said in a March 18 interview.

A bipartisan group of senators also signed a letter dated March 18 urging EPA Administrator Andrew Wheeler to withdraw the proposal. "Utilities have already spent rate-payer dollars to fully comply with the mercury rule," Sens. Lamar Alexander, R-Tenn.; Tom Carper, D-Del.; Susan Collins, R-Maine; Joe Manchin, D-W.V.; Thom Tillis, R-N.C.; and Sherrod Brown, D-Ohio, wrote. "Keeping the 'appropriate and necessary' finding in place and protecting the rule provides much-needed regulatory certainty for the electric power industry and consumers."

Written comments on the proposal are due April 17.