Thursday, May 13, 2010

EPA Ups the Ante on Climate Legislation

On the heels of yesterday's introduction of the Kerry-Lieberman bill to the Senate (see here), the Environmental Protection Agency announced today that it is preparing to finalize a substantive rule under the Clean Air Act to control greenhouse gas emissions from major sources. The completely transparent purpose of this announcement is to increase political support for the climate bill, which is regulated industries are likely to prefer  - because of the compliance-cost advantages of the bill's cap-and-trade regime - to traditional forms of regulation under existing statutory authorities. Quoted in today's Washington Post (here), co-sponsor Joe Lieberman makes no bones about the coordination of the bill's introduction and the EPA's  announcement:

Lieberman told reporters that he believes the prospect of EPA imposing a carbon cap could help mobilize 60 votes in support of climate legislation, since any regulation the agency issues would lack their bill's flexibility and generous incentives for different forms of energy production.


"The gun being held up in the air by EPA is having an effect," he said. "That's a genuine worry, and that's different this year than we've had before, and that's what makes me feel we can get to sixty" votes.
 It is unfortunate that the Obama Administration and Senate Democrats have to play such political games to pass climate legislation, but this is hardly the first time threats of regulation have been used to motivate political support for new legislation. Moreover, there is no question that EPA possesses authority to regulate greenhouse gases under the Clean Air Act (although particular aspects of its proposed regulation are legally questionable and will certainly be subject to legal  challenge).

A fact sheet on EPA's new rule is here. The full final rule is here.

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