EPA Will Regulate CO2 and Other Greenhouse Emissions

EPA Administrator Lisa Jackson (image: reznetnews.org)

The EPA now has the ability to regulate greenhouse gases, the Associated Press reported on April 17th, a decision that could affect the price of heating oil.

The EPA determined “that greenhouse gases contribute to air pollution that may endanger public health or welfare.” Under the rules of the Clean Air Act, the agency now has the ability to regulate the amount of emissions coming from power plants and vehicles.

Said EPA Administrator Lisa Jackson: “This finding confirms that greenhouse gas pollution is a serious problem now and for future generations. Fortunately, it follows President Obama’s call for a low carbon economy and strong leadership in Congress on clean energy and climate legislation. This pollution problem has a solution – one that will create millions of green jobs and end our country’s dependence on foreign oil.”

Details about the EPA regulations have not been released, and any EPA-mandated changes to existing policy are at least several months away from implementation.

However, the EPA’s announcement may force Congress to play its hand on any proposed legislation regarding greenhouse gases. Currently, Congress is debating legislation that would place a “cap and trade” system on producers of greenhouse gases. The EPA’s move may force Congress to vote on the issue soon.  According to Congressman Ed Markey (D-MA), who sits on the Energy and Commerce subcommittee: “The (EPA) decision is a game changer. It now changes the playing field with respect to legislation. It’s now no longer doing a bill or doing nothing. It is now a choice between regulation and legislation.”

Heating oil prices would most likely be affected if Congress passes the proposed legislation, or if EPA regulations are similar to those being debated by legislators. But what is not known is exactly how those prices would change.  Some have argued that the move would lower demand for crude oil, from which heating oil is refined. The European Federation for Transport and Environment recently released a study that said a 1 percent drop in worldwide oil consumption would lead to a nearly 2% drop of the price of crude oil.  However, others argue that cap-and-trade legislation would cause skyrocketing energy costs.  In a 2008 study that looked at how legislation would limit carbon emissions, the Heritage Foundation stated that heating oil costs would rise by more than 20 percent over an 18-year period.  EPA Administrator Lisa Jackson, testifying before Congress, said that limits on greenhouse gas emissions would lead to a “quite modest” increase in electricity costs for homeowners. She added that most households would pay between $98 and $140 more for energy per year.

Despite the possibility of higher energy costs, many environmentalists have hailed the EPA’s findings as a major step toward curbing global warming. As one environmentalist wrote in the Detroit Free Press: “Decades of science have proved that CO[2] regulation is necessary, and sober economic analysis shows that its costs can be more than offset by huge economic growth and job creation opportunities in clean energy and efficiency industries.”

Any measures to limit greenhouse gas emissions will also be met with a fight from business interests, particularly from manufacturers. A spokesperson for the American Chemistry Council, a trade association which represents chemical manufacturers, said that the greenhouse gas emission limits would “impair the chemical industry’s access to affordable, reliable supplies of natural gas” and would also “force energy-intensive industries like chemistry, steel, aluminum and paper, to re-evaluate their presence in the US. “