Bush Team Announces Last Phase of Pollution Control Plan

Announcing the second of its two steps to overhaul the way the Clean Air Act forces power plants to cut pollutants, the Bush administration on Wednesday proposed a market-based, cap-and-trade system to reduce emissions from electric utilities in the East and the Midwest.

“The pollution cuts we propose today will help states and cities across the nation achieve national, health-based air-quality standards,” Environmental Protection Agency Administrator Michael O. Leavitt said after signing the proposed rule in St. Louis.

The proposed “Interstate Air Quality” rule, which is scheduled to take effect in 2005, is intended to curb power-plant emissions that significantly pollute the air in states downwind, causing respiratory illnesses and smog.

The rule would reduce sulfur dioxide by 72% and nitrogen oxide by 64% from current levels in 29 states and the District of Columbia by about 2018, the EPA said.

Wednesday’s action follows an announcement in August that the Bush administration was easing a provision of the Clean Air Act that forced power plants to install modern pollution controls whenever they made any significant modifications that would result in increased pollution.

The two actions, neither of which required congressional approval, represent an effort by the Bush administration to accomplish through regulation what it has been unable to gain legislatively. The administration’s clean-air legislation, known as “Clear Skies,” has stalled in Congress because many Democrats and some Republicans say it is too weak.

The utility industry generally endorsed the administration’s approach, but it was cautious about some of the details and stressed that a legislative solution would be preferable.

“The best course of action will guarantee significant and quick emissions cuts, while minimizing the footprint left on consumers’ electricity bills,” said Dan Riedinger, a spokesman for Edison Electric Institute, a Washington-based utility association that lobbies on behalf of the industry. “In that regard, ‘Clear Skies’ remains preferable to the new rules.”

Environmentalists said the policy changes would result in a slower cleanup of the air than current law requires.

“The transport rule does not provide deep and timely enough pollution cuts to enable states to achieve clean air by the time the Clean Air Act requires,” said John Walke, a lawyer for the Natural Resources Defense Council, a national environmental group.

Most states will be required to improve their air quality over the next decade to meet new health-based standards for ozone and fine particulates.

Under the proposal, states could choose to reduce emissions by requiring power plants to participate in an interstate cap-and-trade program or by adopting their own pollution-reduction plan. The states would be required to meet the first emissions reduction target in 2010 and the second in 2015.

The EPA estimated that the rule would cost utilities more than $5 billion in pollution controls but would result in more than $80 billion in health and environmental benefits.

If they opted for the trading program, EPA would give each state emission allowances for each pollutant. The states would distribute those allowances to power plants, and plants that reduced pollution faster could trade their allowances for cash with plants that lagged.

The utility industry likes the cap-and-trade approach, but it prefers that it be adopted as part of a legislative initiative that would provide them with relief from existing Clean Air Act regulations.

While urging the EPA to make even deeper cuts in pollution, some environmental activists acknowledged that the proposal was a move in the right direction.

“EPA’s proposal to cut interstate power-plant air pollution must be strengthened to fully protect public health,” said Fred Krupp, president of Environmental Defense, a national environmental group. “However, EPA is taking an important step forward in the nation’s fight against air pollution by moving to require substantial reduction” of nitrogen oxides and sulfur dioxides.

Jeffrey Holmstead, assistant EPA administrator for air programs, said the agency projected that the proposed rules would enable 90% of the affected counties to meet the air-quality standards by the 2015 deadline. Most of the other counties would be able to meet their deadline by additionally controlling local pollution sources, he added.

California, which does not receive much pollution from other states, is not expected to take more time to meet the new air-quality standards.

“This is the biggest thing we could ever do,” Holmstead said in an interview. “This is far and away the biggest reduction of air pollution that EPA has ever done through regulation.”

Earlier this week, the administration announced a cap-and-trade program aimed at reducing mercury emissions from coal-fired power plants, another piece of the “Clear Skies” proposal.

Efforts to control power-plant pollution are important for public health; as of 2001, the EPA said, power plants were responsible for 69% of the sulfur dioxide and 22% of the nitrogen oxide emissions nationwide.

Emissions of nitrogen oxide and sulfur dioxide can be transported by wind, causing environmental and health problems hundreds of miles from the sources. They contribute to fine particles, which pose serious health risks, including exacerbating asthma and causing tens of thousands of early deaths annually among people with heart and lung ailments, the EPA said.

Power-plant pollution also contributes to ground-level ozone, a respiratory irritant that aggravates asthma and other lung illnesses.