Proposed EPA rules threaten Pennsylvania manufacturing

They would stifle the coal and gas industries and stall the economic recovery

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The Keystone State is at the center of events that will impact our country’s future.

Pennsylvania is producing a diverse energy mix, including shale gas and coal, that is driving a manufacturing comeback in the commonwealth and across the country. Proposed federal regulations on carbon would put these jobs and the broader economic growth they support at risk. These issues will come to a head at a public hearing in Pittsburgh this week.

Pennsylvania is fueling our economic growth by providing the resources that have kept electricity affordable. The U.S. Department of Energy ranks Pennsylvania as the nation’s fourth-largest coal-producing state, with more than 54 million short tons in 2013.

The state also sits atop what the Pennsylvania Independent Oil and Gas Association has described as one of the largest natural gas fields in the world — the Marcellus and Utica shales. These gas deposits have made Pennsylvania one of the fastest-growing natural gas producers in the country, according to the Department of Energy.

Affordable electricity prices supported by Pennsylvania coal and gas are helping manufacturers compete and grow. Pennsylvania manufacturers now employ more than 563,000 men and women and contribute $70.6 billion to the state’s economy. Nationally, a resurgent manufacturing sector now employs more than 12 million workers and recently reached the $2 trillion mark for its contribution to the U.S. economy.

However, this critical manufacturing growth is about to run directly into a series of new federal regulations that threaten to grind our recovery to a halt by limiting the use of coal and, ultimately, natural gas.

The Environmental Protection Agency has proposed two regulations on new and existing power plants that would transform how electricity is generated, distributed, transmitted and used, which could eliminate the critical competitive advantage that affordable and reliable electricity provides to Pennsylvania and the nation’s economy.

These rules would set emissions standards so low that they probably could not be met by coal-fired power plants, meaning no new plants would be built and existing ones could be shut down. Coal — much of it from Pennsylvania — is affordable and abundant and provides nearly 40 percent of our nation’s power. Eliminating it as a fuel source would raise electricity prices and might even put reliable access to electricity at risk.

Eliminating coal is the beginning, rather than the end, of the Obama administration’s plans. As the administration ramps up regulations on greenhouse gas emissions, natural gas production, processing transmissions and storage could also be targeted. Pennsylvania’s natural gas could ultimately be limited as a source of U.S. power as well.

The administration doesn’t know what the full implications of this regulatory approach may be, but some outcomes are certain.

Federal regulators admit that electricity prices will go up by as much as 4 percent to 7 percent nationally and 12 percent in some locations, though many experts believe the price hikes will be much larger.

We also know these proposed regulations are the first among a suite of follow-on rules that would impact many industries twice — both as electricity customers and as industries next in line for subsequent regulations. The EPA’s budget request to Congress notes it will soon begin considering new greenhouse gas regulations on other sectors, such as pulp and paper, iron and steel production and many others.

The EPA hearing in Pittsburgh Thursday and Friday will feature companies from across Pennsylvania and the region speaking out about the negative effects of the agency’s proposed rules. More than 160 organizations from around the country have formed the Partnership for a Better Energy Future to coordinate efforts to protect businesses and the jobs they support from the EPA’s far-reaching and costly regulations.

Affordable energy fueled, in part, by Pennsylvania coal and gas supports a manufacturing comeback that is creating great jobs. We can’t sit passively on the sidelines while the administration adopts regulations that would dismantle some of the key elements of that comeback. Our case that a diverse energy supply powers economic growth begins again in Pittsburgh this week.

Jay Timmons is president of the National Association of Manufacturers.

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