Evidence Mounts to Back EPA Mercury Rules, With Annual Benefits of $50 to $130 billion

by Daniel J. Weiss and Jackie Weidman

We are a week away from the December 16th deadline for the Obama Administration to issue its final toxic air pollution reduction rules for coal fired power plants.  This comes more than two decades after President George H.W. Bush signed this public health protection into law as part of the Clean Air Act of 1990.

There is escalating pressure from dirty utilities and coal companies to weaken or delay the pollution reduction standards even though they support from other companies.  Six coalitions representing 125,000 businesses, ranging from Fortune 500 companies to small businesses, sent a letter to President Obama strongly supporting a timely promulgation and implementation of the Environmental Protection Agency’s rules.  Led by Ceres and the Small Business Majority, urge that caving to the polluters’ demands would jeopardize much needed jobs and postpone innovation and investment.  These diverse businesses emphasize that “the Clean Air Act yields substantial benefits to the economy and to business, and that these benefits consistently outweigh the costs of pollution reductions.”

These pollution reductions are long overdue.  The dirtiest power plants in the U.S. account for a disproportionately large amount of toxic pollutants, according to an analysis by the Environmental Integrity Project (EIP) released on December 7th.  The report concludes that coal fired power plants in Ohio, Pennsylvania, Indiana, Kentucky and Texas have the most toxic emissions.

Ilan Levin, associate director of Environmental Integrity Project, said

The only thing more shocking than the large amounts of toxic chemicals released into the air each year … is the fact that these emissions have been allowed for so many years.  There is no reason for Americans to continue to live with unnecessary risks to their health and to the environment. “

These rules will remove millions of pounds of mercury, lead, arsenic and other dangerous pollutants from coal plants, preventing 17,000 premature deaths annually.   Although EPA estimates that it will cost utilities $10.9 billion to clean up, it will save at least $59 billion in fewer premature deaths, lower health care costs, and fewer absences from work or school.  Despite these benefits, the companies most affected by the rules– with the dirtiest power plants – and their allies are launching a serious rear guard action to weaken or delay these reductions.

Anti-pollution control forces have encouraged their allies to advocate on their behalf.  For instance, an editorial by Murdoch’s Wall Street Journal from December 6th misleadingly diminished EPA’s benefit projections for the rules.

Siding with dirty utilities, the editorial inaccurately interpreted the EPA’s Regulatory Impact Analysis from March by claiming that societal benefits from mercury reductions “max out at $6.1 million.”  These numbers isolate a specific section of the analysis rather than looking at the entire benefit-cost projections. The figure by the Journal only refers to benefits from “exposure among recreation freshwater anglers.”   In other words, the figure applies to recreational anglers, and clearly represents a very small portion of the overall health benefits.

On the contrary, EPA projects:

“Annual monetized benefits of $58 to 140 billion (3 percent discount rate) or $52 to 130 billion (7 percent discount rate) are expected for the proposed Toxics rule in 2016.”

Benefits detailed in the report are due to decreased health costs from current health ailments the public currently faces because of mercury pollution.  They include neurological problems, cardiovascular impacts, chromosomal damage, and immunologic effects, among others.

The Massachusetts Institute of Technology just released a report on December 5th, which is the latest in a long line of energy assessments that determine the air toxics rule will have little or no impact on reliability.  Study co-director Richard Schmalensee, said that, most importantly, the U.S. power grid is definitely not “on the brink of widespread failure.”  Furthermore, the study shows that our electric grid “could handle expected influx of electric cars and wind and solar generation.”

Kentucky Power announced on December 6th a $1 billion pollution control retrofit for one of its generation units of the Big Sandy Power Plant.  Greg Pauley, president and chief operation officer of Kentucky Power stated the improvement, aligned with EPA rules, is

“in the best interested of [its] communities overall, and will permit job retention, [and] a significant contribution to the tax base.”

This project is expected to “create as many as 700 jobs.”

Those who blame EPA regulations for coal plant closures both ignore unassociated reasons for shutting down, and exaggerate the impact closures will have on the U.S. electric grid.

Source: the Analysis Group Fall 2011 Update

The plants that are scheduled to retire account for just 5 percent of total coal-fired generation from 2010, and have lower than average capacity factor compared to all coal plants.

Unused capacity in natural gas plants is likely to offset coal plant closures as wholesale electricity prices from gas plants are decreasing, the U.S. Energy Information Administration concluded last year.

natural gas and coal plant capacity, 2007

Constellation Energy is another example of a utility that succeeded in economically retrofitting its facilities to reduce toxic pollution. Its Brandon Shores plant spewed the most hazardous materials of any U.S. power plant back in 2008.   But Constellation invested in clean pollution control to create one of the cleanest coal-burning power plants in the country.  It met the Maryland pollution-control deadline “without a hiccup in delivering electricity.”

Paul Allen, Constellation’s chief environmental officer, assures other utilities that “it’s entirely possible to comply with these rules and remain a profitable company.”  Active construction took just 26 months, employing 1,400 skilled construction workers. Constellation emphasizes that reliability was not compromised while constructing retrofits and that other utilities can do the same through proper planning and scheduling maintenance during non-peak hours.

Constellation is urging the White House to reject pleas from dirty utilities who claim they can’t do the same by the 2015 deadline for air toxics reductions.

All of these analyses from different sources have one finding in common: they agree that cleaning up the nation’s dirtiest coal plants can be accomplished without threatening electricity reliability.  As the December 16 deadline approaches, there is a growing body of evidence that protecting our children’s health from mercury and other toxic pollutants from dirty power plants is possible without turning the lights off.

Daniel J. Weiss is a Senior Fellow and the Director of Climate Strategy and Jackie Weidman is a Special Assistant at the Center for American Progress.



9 Responses to Evidence Mounts to Back EPA Mercury Rules, With Annual Benefits of $50 to $130 billion

  1. Risa Bear says:

    Whenever I think about mercury I think about Minamata. It’s an apt metaphor for Fukushima, as well as our world’s current dilemma, and the young man in the wheelchair quoted on the famous W. Eugene Smith poster says it all:

  2. Jay Turner says:

    Given how large the benefits are, I wish we would find a way to turn a share of that benefit into cash incentives for the power companies. If we paid them to do the retrofits, they’d stop complaining and get on wit it.

  3. Mulga Mumblebrain says:

    Jay, if you paid them, they’d trouser the money then get on with business as usual. Lock a few executives up until the job is done, and that will concentrate their minds.

  4. Doug Bostrom says:

    A couple of days ago I broke a florescent lamp here at home. Where I live, these lamps need to be disposed of at the city’s hazmat facility, so a little bit of a hassle. I found myself wondering why I was bothering to follow this plan, considering that coal plants are spewing mercury into the air in astounding quantities.

  5. Hot Rod says:

    Have any of you looked through the actual report? $100bn of net benefit from saving the projected IQ loss from the mercury content in freshwater fish? based on studies from the Faroe islands and Seychelles? Gimme a break here.

    Ok, I’ll be fair – ‘The reduction in premature fatalities each year accounts for over 90 percent of total monetized benefits.’

    So, let me get this straight, mercury in freshwater fish is killing people at a cost to the USA of $100bn?

    That’s a lot of people, and a real scandal.

  6. Ziyu says:

    Hot Rod, most mercury is inhaled. People with asthma are particularly vulnerable. The loss of $100 billion comes from a) lost productivity and b) health costs. If you’re so sure mercury isn’t that harmful to society, please, take a job as Joe Barton’s staffer. You’ll learn all about how pollution doesn’t actually hurt people.

  7. Joan Savage says:

    Mercury pollution in fish tissue (downwind of coal plants in Ohio, Indiana and Pennsylvania) is the basis for a New York state-wide health advisory about consumption of locally-caught fish. Despite the health advisory, some people still fish for subsistence consumption.
    Formerly New York state had a substantial commercial freshwater fishery, which declined for a number of reasons, but which cannot be resurrected until at minimum the fish are free of dangerous contaminants. Mercury is the most pervasive contaminant in New York fish tissue.
    The figure of billions of dollars doesn’t surprise me, given that I recently paid nearly $20 a pound for a healthy, presumably low-mercury, sample of Alaskan wild-caught salmon.

  8. Joan Savage says:

    Sorry, that conflates the health damages billions with the economic losses from mercury contamination.
    I still have hope to eat some local mercury-free fish before I die!

  9. hot rod says:

    No idea how to use my daughters iPad, but I still struggle with the passage I quoted. And I’ve never inhaled a freshwater fish.

    I have no problem with environmental cleanliness, just with the exaggerated numbers. As in I don’t want another chernobyl, but stop claiming it killed 100’000’s. Only hydro power has managed that.

    Exaggeration just weakens your position.