Oklahoma’s Largest Utility Confused As U.S. Supreme Court Scuttles EPA Rule

  • Logan Layden
OG&E's coal-fired power plant in Muskogee, Okla.

gmeador / Flickr

OG&E's coal-fired power plant in Muskogee, Okla.

In a 5-4 decision, the U.S. Supreme Court on Monday blocked the U.S. Environmental Protection Agency’s attempt to curb mercury and other toxic emissions from coal-fired power plants across the country.

Oklahoma joined nearly two dozen other states in the lawsuit against the EPA, claiming the federal agency failed to consider the high cost of complying with the Mercury and Air Toxics Standards (MATS), as The Washington Post‘s Robert Barnes reports:

The issue comes down to what Congress meant when it ordered the EPA to study whether it was “appropriate and necessary” to regulate the pollutants from power plants. The directive was silent on whether that study should include the costs of regulation.

Objecting states and the industry contended that costs traditionally are a part of such decisions.

The highest court in the land agreed. The question is what happens now. Oklahoma Gas & Electric — the state’s largest utility company — was facing an April 2016 deadline to comply with the standards by installing new equipment at its existing power plants, namely activated carbon injection equipment (ACI) that would cut mercury. The cost of those upgrades are included in the utility’s current rate increase request at the Oklahoma Corporation Commission.

Spokeswoman Kathleen O’Shea tells StateImpact OG&E isn’t sure exactly what to do going forward.

“We haven’t actually put any of these ACIs in service yet, but we’ve been doing testing and engineering and getting contracts on the equipment,” O’Shea says. “If MATS isn’t going to be there right now do we continue down this path, or do we stop?”

O’Shea says she expects the cost of compliance with MATS to be $26 million for equipment, with an annual operating cost of about $37 million.

“If we can be compliant, and not have to install this equipment, that’s probably better for our customers, in the sense of their rates.”

But the Mercury and Air Toxics Standards aren’t disappearing. A press release from the New York School of Law’s Institute for Policy Integrity explains:

Today, the Supreme Court ruled that the Environmental Protection Agency (EPA) did not consider costs at the appropriate stage of the regulatory process before crafting the Mercury and Air Toxics Standards. This rule, which regulates toxic emissions from power plants, will now be sent back to the U.S. Court of Appeals for the D.C. Circuit, where the judges will decide how the EPA should proceed.

“It is very likely that the mercury rule will ultimately be upheld, and that it will remain in place as the legal process continues,” said Richard Revesz, director of the Institute for Policy Integrity and dean emeritus of NYU Law School.

The release says the Court of Appeals can either vacate the rule entirely, or keep “the rule in place while the EPA makes required changes.”

Whitney Pearson, with the Sierra Club’s Beyond Coal Campaign, says she’s disappointed in the ruling, but expects MATS to live on.

“Given the dangerous amount of toxic mercury pollution emitted by coal-fired power plants, and the massive public health benefits of curtailing that pollution, we expect that EPA will be able to promptly complete the analysis demanded by the five-judge majority,” Pearson tells StateImpact.

Oklahoma Gov. Mary Fallin is also weighing in, calling the Supreme Court’s decision a “victory for American families and businesses that would have faced skyrocketing costs because of unreasonable rules and regulations.”