How EPA plans will implement Cap & Trade, increase federal spending, negatively impact state/municipal budgets, eliminate jobs, and hurt industry/businesses

1. Endangering Our Economic
Environment
How EPA plans will implement Cap &
Trade, increase federal spending,
negatively impact state/municipal
budgets, eliminate jobs, and hurt
industry/businesses

2. Presentation Overview
• New EPA regulations
• Impact of new EPA regulations on states
• EPA goals and budgets
• Congressional oversight structure
• What we can do
• Q&A

3. Cost of Regulation
Business “..total regulatory costs amount to about $1.75 trillion annually,
nearly twice as much as all individual income taxes collected last year. “
• 2009: 23 new
regulations - $13B
• 2010: 43 new
regulations - $28B
– 10 EPA $23.2B
– 15 Financial
– 5 Obamacare
Source: Heritage Foundation – “Red Tape Rising: Obama’s Torrent of New Regulation” Oct 26 2010

4. ”…the White House and the EPA
are clearly targeting fossil fuels,
and coal in particular, to achieve
via rule-making what even the
Democratic 111th Congress has
rejected as legislation.”
Source: Wall Street Journal – “The Unseen Carbon Agenda” Oct 27 ‘10

5. The Next Big Scam:
Carbon Trading Markets
• “the white collar crime of the future”
-Deloitte Forensic
• “a fraudster’s dream come true”
-Kroll, a business risk subsidiary of Marsh & McLennan
Source: Financial Post, Jan 13, 2010-10-28

6. New EPA Regulations
Propose mandates to either invest in new environmental controls or close
facility
1. Clean Air Transport Rule (CATR) – minimizing ozone and fine particle distribution
geographically
• Includes proposals for “trading” emissions and/or emission caps
2. Cooling water intake structures – recirculating water systems
3. Coal Combustion Residuals (CCR) disposal regulations
• Reclassify coal ash as hazardous waste or require investment in lining of disposal sites
• Could impact recycling of coal ash in production of cement, concrete, roadbed material,
drywall, etc.
4. Maximum Achievable Control Technology (MACT) – national emission standards for
hazardous air pollutants
Source: EPA

7. MACT
• “Maximum achievable” standards = 12% of industry can already achieve
– Today, less than1% can meet the proposed rules
• Emission levels can barely be detected with existing instruments
• Manufacturers of new equipment cannot guarantee compliance
• Affects many manufacturers and segments, including universities, food
product processors, furniture makers
• Compliance costs are estimated as high as $50 billion
• Likely to result in the closure of many facilities
• Could kill hundreds of thousands of jobs
• 41 Senators and 106 Representatives and at least 50 industry associations
sent letters to the EPA regarding their concern on the negative economic
impact
Source: various news publications and impacted industry publications/studies

8. Impact of EPA’s Pending Electric Utility
Regulations
• North American Electric Reliability Corporation (NERC) - highly regarded
federal energy advisory body
– Issued a special assessment on EPA’s pending electric utility regulations
– Regulations, as proposed, will reduce national power generation by 7.2% by
2015
• Mostly coal-fired plants
– Produce about half of all US electricity
– Produce 63% of Georgia’s electricity
• Credit Suisse estimates $150 billion in capital investment by 2019 in order
to comply with new regulations
Sources: NERC, Credit Suisse

9. RESPONSES FROM EPA
• “The NERC report offers doomsday speculations
from industry lobbyists, and in no way reflects
the EPA’s common-sense efforts to reduce
harmful pollution.”
- Lisa Jackson, EPA Administrator
• “The sky isn’t falling.”
- Jon Wellinghoff, Chairman of Federal
Energy Regulatory Commission (FERC)

10. Tougher Regulations for Heavy-duty Vehicles
• New fuel-efficiency regulations for medium and heavy duty vehicles
manufactured from 2014-2018
– 10-20% reduction in fuel consumption and emissions, depending on vehicle
size
• Cover big-rig tractor-trailers, garbage trucks, transit buses, school buses,
work trucks such as heavy-duty versions of the Ford F-Series, Dodge Ram
and Chevrolet Silverado
• Standards drawn from 2010 study issued by the National Academy of
Sciences
– Organization accused of distortion of global warming stats, “Climategate”
• EPA and DOT expect the prices of heavy-duty trucks to increase by nearly
$6,000
Source: EPA

11. Tougher Regulations for Heavy-duty Vehicles
“The Environmental Protection Agency proposed emissions regulations for
long-haul trucks Monday, the first ever to limit greenhouse gases. It was an
early example of sweeping regulations the agency is set to unveil next year.”
“The announcement underscored how much the EPA is acting unilaterally on
greenhouse gas emissions. With cap-and-trade stalled in Congress, the agency
has moved ahead under a 2007 Supreme Court ruling that gives it authority to
enact its own regulations.”
Source: Investors.com – “Acting On Its Own, EPA Sets New Rules On Truck Emissions”, Oct 25, 2010

12. 2007 Supreme Court Ruling on EPA
Massachusetts et al vs EPA et al
• Massachusetts, 11 other states, and others sued the EPA for not regulating 4
greenhouse gases, including CO2, from the transportation sector
– Claim human-influenced global climate change was causing adverse effects,
such as sea-level rise, on Massachusetts
• EPA (along with 10 states, auto mfgs and utilities) argued
– EPA lacks authority under the Clean Air Act to regulate GHG or fuel economy standards
(DOT)
– CO2 not ruled a pollutant
– No causal relationship between CO2 and climate change
• Supreme Court ruled
– CO2 fits the definition of an air pollutant
– EPA has the authority to regulate CO2 and other greenhouse gases
– Written by Justic Stevens, signed by Kennedy, Souter, Ginsburg, Breyer
– Dissents from Roberts, Alito, Scalia, Thomas
Source: US Supreme Court

13. More Work, Less Funds to Do It:
Issuance of EPA Rules with State/Local Impacts
2000-2011
Source: Environmental Council of the States (ECOS)
Note: ECOS is the national non-profit, non-partisan association of state and territorial environmental agency leaders

14. The EPA has
more pending
actions that have
significant impact
on states than any
other federal
agency
Source: Environmental Council of the States (ECOS)

15. Source: Environmental Council of the States (ECOS)

16. EPA Organizational Structure
More than 18,000 employees
Administrator
Deputy Office of Congressional and Intergovernmental Relations
Administrator (Asso. Admin)
Office of Policy,Economics and Innovation Office of Public Affairs
(Asso. Admin) (Asso. Admin)
Office of Administration and Resources Management Office of Air and Radiation
Office of Enforcement and Compliance Assurance Office of Environmental Information
Office of the Chief Financial Officer Office of General Counsel
Office of International and Tribal Affairs
Office of Inspector General
(was Office of International Affairs until April 2010)
Office of Chemical Safety and Pollution Prevention
Office of Research and Development
(was Prevention, Pesticides, and Toxic Substances until April 2010)
Office of Solid Waste and Emergency Response Office of Water
PLUS 10 Regional Administrators

17. EPA Regional Offices
Source: EPA

18. Lisa Jackson’s Seven Priorities for EPA’s Future
Fiscal Year Budget 2011: $10.02 billion in discretionary spending
$618mm for enforcement
Expanding the
Conversation on Building
Taking Action Assuring the Cleaning Up Protecting Environmentalism Strong
Improving
on Safety of Our America’s and State and
Air Quality
Climate Change Chemicals Communities Waters Working for Tribal
Environmental Partnerships
Justice:
“We will carry out our mission by respecting our core values of
science, transparency and the rule of law. “
Source: EPA

19. Expanding the
Conversation on Building
Taking Action Assuring the Cleaning Up Protecting Environmentalism Strong
Improving
on Safety of Our America’s and State and
Air Quality
Climate Change Chemicals Communities Waters Working for Tribal
Environmental Partnerships
Justice:
• Continue greenhouse gas reduction initiatives
• Ensure compliance with the law
• Finalize mobile source rules (compounds emitted from highway vehicles and non-road equipment which are
known or suspected to cause cancer or other serious health and environmental effects)
• Expand cost-saving energy conservation and efficiency programs, i.e, Energy Star
• Develop common-sense solutions for reducing greenhouse gas emissions from large
stationary sources like power plants
Source: EPA

20. Expanding the
Conversation on Building
Taking Action Assuring the Cleaning Up Protecting Environmentalism Strong
Improving
on Safety of Our America’s and State and
Air Quality
Climate Change Chemicals Communities Waters Working for Tribal
Environmental Partnerships
Justice:
• Stronger standards for ozone
• Cleaner and more efficient power sector
• strong but achievable emission reduction goals for SO2, NOx, mercury and other air
toxics
• Stronger standards for pollutants such as PM, SO2 and NO2
• achieve reductions from a range of industrial facilities
• Improved monitoring, permitting and enforcement

21. Expanding the
Conversation on Building
Taking Action Assuring the Cleaning Up Protecting Environmentalism Strong
Improving
on Safety of Our America’s and State and
Air Quality
Climate Change Chemicals Communities Waters Working for Tribal
Environmental Partnerships
Justice:
• Modernizing the Toxic Substances Control Act
• Address high-concern chemicals and filling data gaps on widely produced chemicals in
commerce
• First-ever chemical management plans for four groups of substances, and more plans are in
the pipeline for 2010
• Rigorous, peer-reviewed health assessments on dioxins, arsenic, formaldehyde, TCE and
other substances of concern

22. Expanding the
Conversation on Building
Taking Action Assuring the Cleaning Up Protecting Environmentalism Strong
Improving
on Safety of Our America’s and State and
Air Quality
Climate Change Chemicals Communities Waters Working for Tribal
Environmental Partnerships
Justice:
• Accelerating Superfund program
• Risk reduction
• Stronger partnerships with stakeholders
• Confronting significant local environmental challenges
• Asbestos Public Health Emergency in Libby, Montana
• Coal ash spill in Kingston, Tennessee
• Maximizing brownfields program to spur environmental cleanup and job creation in
disadvantaged communities

23. Expanding the
Conversation on Building
Taking Action Assuring the Cleaning Up Protecting Environmentalism Strong
Improving
on Safety of Our America’s and State and
Air Quality
Climate Change Chemicals Communities Waters Working for Tribal
Environmental Partnerships
Justice:
• Address complex challenges, from nutrient loadings and stormwater runoff, to invasive
species and drinking water contaminants
• Comprehensive watershed protection programs for the Chesapeake Bay and Great Lakes
• Post-construction runoff, water quality impairment from surface mining, and stronger
drinking water protection
• Recovery Act funding will expand construction of water infrastructure
• Work with states to develop nutrient limits and launch an Urban Waters initiative
• Revamp enforcement strategies to achieve greater compliance

24. Expanding the
Conversation on Building
Taking Action Assuring the Cleaning Up Protecting Environmentalism Strong
Improving
on Safety of Our America’s and State and
Air Quality
Climate Change Chemicals Communities Waters Working for Tribal
Environmental Partnerships
Justice:
• New era of outreach and protection for communities historically underrepresented in EPA
decision-making
• Building relationships with tribes, communities of color, economically distressed cities and
towns, young people
• Include environmental justice principles in all of our decisions
• Children’s Health Office is bringing a new energy to safeguarding children through all of our
enforcement efforts

25. Expanding the
Conversation on Building
Taking Action Assuring the Cleaning Up Protecting Environmentalism Strong
Improving
on Safety of Our America’s and State and
Air Quality
Climate Change Chemicals Communities Waters Working for Tribal
Environmental Partnerships
Justice:
• States and tribal nations bear important responsibilities for the day-to-day mission
• Declining tax revenues and fiscal challenges are pressuring state agencies and tribal
governments to do more with fewer resources
• Strengthened oversight, ensure that programs are consistently delivered nationwide

26. NOTE: Does NOT include $7.22 billion from the American
Recovery and Investment Act (ARRA) of 2009
Source: EPA

27. Reductions in
Superfund, state
grants, Great Lakes,
recycling, nat’l security
Source: EPA

28. Compliance &
Environmental Clean Air & Global
Stewardship Climate Change
Healthy
Communities
& Ecosystems
Land Preservation Clean & Safe
& Restoration Water
Source: EPA

29. State & Tribal
Assistance
Grants
Science &
Technology
Environmental
Programs & Mgt
Superfund
Source: EPA

30. Chairman: Jon Wellinghoff
Secretary: Dr. Stephen Chu
(apptd by Obama)
Chairman: Henry Waxman (D-CA) (apptd by Obama)
Oversees Committee on Oversees
FERC Energy & DOE
Commerce
National energy policy ; generation of power;
independent gov’t agency that regulates interstate reliability, transmission and ratemaking; siting;
power generation and transmission to provide general mgt of DOE and FERC
consumers with reliable, efficient and sustainable
energy at a reasonable cost
Oversees
NERC
Administrator: Lisa Jackson
Chairman: Edward Markey (D-MA) (apptd by Obama)
Subcommittee
on Energy
And
Environment
Self regulatory org to ensure bulk power National energy policy; energy regulation
reliability; Has legal authority to enforce and utilization; Superfund, Resource
reliability standards Conservation and Recovery Act, Safe
Drinking Water Act; The Clean Air Act

31. WHAT CAN WE DO?

32. “Regulatory costs will rise until
policymakers appreciate the burdens
that regulations are imposing on
Americans and the economy, and
exercise the political will necessary to
limit—and reduce—those burdens. “
Source: Heritage Foundation – “Red Tape Rising: Obama’s Torrent of New Regulation” Oct 26 2010

33. Promote Action in US Senate
• Deny the EPA powers over carbon emissions
– Sen. Jay Rockefeller, D-W.Va., sponsored a bill to put a two-
year halt on any EPA rules - six Democratic co-sponsors
– A similar bill by Alaska GOP Sen. Lisa Murkowski got 53 votes
this summer
• "Even in the face of the president's veto threat, we must send a
clear message that Congress — not an unelected regulatory agency
— must set our national energy policy," Rockefeller said in a
September statement

34. Promote Action in US House
• Deny EPA funding
– House controls purse strings (now in Republican control)
• Ensure fiscal conservatives are elected to chair important
committees
– Committee on Energy & Commerce
– Subcommittee on Energy & Environment

35. Revive Georgia Legislation Started in 2010
Bill
Title Bill number & summary Bill status sponsor
Georgia S. 401: Permits governor to delay implementation Passed Seabaugh Senators Mitch Seabaugh
Energy of federal greenhouse gas programs until an Senate, (R) (28th), Chip Rogers (21st), Bill
Freedom Act assessment is made that the implementation will got thru Heath(31st), Bill Cowsert
of 2010 benefit Georgians. 2nd House (46th), Jeff Chapman (3rd)
Reading and Jeff Mullis (53rd) and
others
S.R. 958: Requests that U.S. Congress adopt Got Pearson Senators Chip Pearson (51st),
legislation to postpone EPA's efforts to regulate through (R) Jack Murphy (27th), Jeff Mullis
greenhouse gases using the Clean Air Act. 2nd (53rd), Chip Rogers (21st)
Senate Ross Tolleson (20th)
reading
H.R. 1357: Requests that U.S. Congress adopt Got Stephens 164th
legislation to postpone EPA's efforts to regulate through (R)
greenhouse gases using the Clean Air Act. 2nd House
reading
Is responsible for programs under four federal laws:
• Clean Air Act
• Resource Conservation and Recovery Act Commissioner Chris Clark
• Safe Drinking Water Act
• Clean Water Act FY11 Budget: $254.1 million

36. Participate in Public Comment
• Continue debate on scientific proof of global warming
• Continue debate on relationship of greenhouse gases to climate
change
• Continue debate on classification of CO2 as hazardous pollutant
• Make comments, testify when public hearings are held
• GET ENGAGED IN GTPI’S FEDERAL AND STATE TASK FORCES

37. While the EPA is
the worst offender
relative to costly
new regulation,
other agencies
are regulating, too
Source: Environmental Council of the States (ECOS)

38. Questions?