The Obama administration finished crafting tough new rules Friday curbing mercury and other poisons emitted by coal-fired utilities, according to several people briefed on the decision, culminating more than two decades of work to clean up the nation’s dirtiest power plants.
As part of last-minute negotiations between the White House and the Environmental Protection Agency, the regulations give some flexibility to power plant operators who argued they could not meet the three-year deadline for compliance outlined by the EPA. Several individuals familiar with the details declined to be identified because the agency will not announce the rules until next week.
The new rules will cost utilities $10.6 billion by 2016 for the installation of control equipment known as scrubbers, according to EPA estimates. But the EPA said those costs would be far offset by health benefits. The agency estimates that as of 2016, lowering emissions would save $59 billion to $140 billion in annual health costs, preventing 17,000 premature deaths a year along with illnesses and lost workdays.
The Obama administration is attempting to deliver on some key priorities for environmentalists without alienating the business community. President Obama angered environmentalists in September by pulling back stricter smog standards the EPA had proposed, and he had to make several environmental concessions to congressional Republicans late Friday as part of a deal to extend the payroll tax cut. Senate leaders agreed Friday night on a provision that would accelerate the Keystone XL pipeline permitting decision as part of a deal to extend cuts in the Social Security tax.
The administration was also making deals Friday on another environmental front: Alaska. As part of the spending bill negotiations, the administration agreed to transfer the authority to issue air permits for offshore Arctic drilling rigs from the EPA to the Interior Department, which many industry executives think would have more lax standards. Separately, the Interior Department gave conditional approval Friday to Shell Oil’s exploration plan for Alaska’s Chukchi Sea, where the oil giant hopes to drill several wells in the summer.
Several experts said the new controls on mercury, acid gas and other pollutants represent one of the most significant public health and environmental measures in years. The rules will prevent 91 percent of the mercury in coal from entering the air and much of the soot as well: According to EPA estimates, they will prevent 11,000 heart attacks and 120,000 asthma attacks annually by 2016.
“I think this will prove to be the signature environmental accomplishment of the Obama administration,” said Frank O’Donnell, who heads the advocacy group Clean Air Watch. “It will soon mean the end of the smoke-spewing coal power plant as we know it today. At the same time, the administration is trying to add a bit of flexibility to extinguish the bogus claim that these standards could mean lights out.”
The debate over the rules has also split the nation’s utility sector. Some companies, such as New
Jersey-based Public Service Enterprise Group and Illinois-based Exelon, say they could meet the new standards easily and have already spent hundreds of millions of dollars to do so. PSEG has also switched from coal to natural gas.