Wyoming Infrastructure Authority

It prefers state control to EPA regulations

By DUSTIN BLEIZEFFER - Star-Tribune energy reporter trib.com, September 22, 2010

JACKSON — An executive of Wyoming’s largest electrical utility is urging lawmakers to regulate greenhouse gases — or at least tell federal regulators that Wyoming can regulate its own industrial greenhouse gas emissions.
MidAmerican Energy Holdings Co., parent company of utility giant Rocky Mountain Power, hopes Wyoming doesn’t have to actually regulate greenhouse gases for a long time. But it would prefer that Wyoming and other states take on the duty rather than the U.S. Environmental Protection Agency.

“I have no confidence in how long it will take EPA to issue a permit for greenhouse gas emissions. … It’s not clear how that permitting process would work,” said Cathy S. Woollums, senior vice president and chief environmental counsel for MidAmerican Energy.
Woollums testified before the Legislature’s Minerals, Business and Economic Development Interim Committee on Tuesday. The committee took no action on the issue.

Toward the end of the George W. Bush administration, EPA was forced by the U.S. Supreme Court to recognize greenhouse gases as pollutants and therefore subject to regulation under the Clean Air Act. In the absence of a climate and energy policy by Congress, EPA officials continue retooling agency rules in preparation to regulate greenhouse gases.

A key piece of the EPA’s plan, the “Tailoring Rule,” is scheduled to begin Jan. 1, requiring large industrial facilities to obtain permits for greenhouse gas emissions. The Tailoring Rule attempts to delay regulation requirements for small businesses, agriculture and other sources. Last week, Gov. Dave Freudenthal told EPA that Wyoming is statutorily prevented from regulating greenhouse gases, referring to a 1999 provision in state statutes originally intended to shield Wyoming from taking part in the Kyoto Protocol, an international climate treaty.

But Woollums warned that Wyoming — and 13 other states that say they either cannot or will not regulate greenhouse gases — are in EPA’s crosshairs. Although the agency might not have wanted the highly complex and politically volatile job of regulating greenhouse gases, it is determined to carry out the task unless Congress finally addresses the issue through climate legislation.
Woollums likened the situation to Cinderella’s ugly step-sister trying to stuff her foot into the glass slipper, “and that ugly step-sister is not going to stop,” she said.

Rob Hurless, Freudenthal’s telecommunications and energy policy adviser, said EPA’s plan to regulate greenhouse gas is very unpopular among industry and environmental groups alike. Industry fears unintended consequences and being forced to shutter some facilities, while environmental groups say the regulatory thresholds don’t go far enough.

And even the states that say they’re willing to regulate greenhouse gases under the Clean Air Act seem to agree that they need much more time to figure out how to do it.

For these reasons, and the fact that the country is in a highly contentious election season, Hurless said he believes EPA will delay implementation of the Tailoring Rule.

“There are probably 150 institutions in some 30-odd lawsuits,” Hurless said. “Some folks have argued that this is kind of a big game of chicken between the (Obama) administration and Congress about who is actually going to regulate these gases.”

Hurless said a bill by Sen. Lisa Murkowski, R-Alaska, to strip EPA’s authority to regulate greenhouse gases at all was too extreme politically and likely won’t survive. However, a draft bill by Sen. John Rockefeller, D-W.Va., that would put EPA’s plans on hold for two years will likely gain traction.

Yet the situation remains “a colossal mess,” Hurless said.

For now, it appears coal-heavy utilities including Rocky Mountain Power will be subject to dual permitting authorities: EPA for greenhouse gases and individual states for other pollutants. Additionally, EPA is moving forward with plans to reduce the maximum threshold regarding ozone, another regulation that may require significant changes for industrial activities.

“These are all the issues we have to deal with in the very near term, and my organization does long-term planning, 10 years and further,” Woollums said. “It’s going to force us into a situation where some investment in existing facilities is not going to be viable. It’s probably going to mean that smaller, older units are going to have to shut down.”

Energy reporter Dustin Bleizeffer can be reached at (307) 577-6069 or dustin.bleizeffer@trib.com. Go to http://tribtown.trib.com/DustinBleizeffer/blog to read Dustin’s energy blog.