- The Washington Times - Friday, May 19, 2000

Nearly every day, the Environmental Protection Agency announces a new lawsuit or administrative action against an alleged industrial polluter.

Many people, especially those in the media, instinctively side with EPA, assuming that the government is protecting the public interest while industry is only out for itself. But what happens when the alleged polluter also is a federal agency, and feels so wronged that it turns around and sues EPA? Such intragovernmental fighting makes clear that something is awry with federal enforcement of environmental laws.

Beginning last November, EPA initiated a wave of lawsuits and administrative enforcement actions against 44 electric power plants in the Midwest and South. This includes seven administrative orders against the Tennessee Valley Authority (TVA), a federally owned utility headquartered in Knoxville Tennessee that provides power throughout a seven state region. EPA claims these coal-burning facilities have been flouting the Clean Air Act for decades, thereby creating a swath of ozone smog that stretches all the way to the Northeast.

Last week, TVA became the first of these entities to fire back, filing a petition for review of EPA's actions with the U.S. 11th Circuit Court of Appeals. After months of failure to find a resolution acceptable to both agencies, TVA Chairman Craven Crowell says that "to protect the interests of our customers, we have resorted to the courts to ensure we are treated fairly as we continue to maintain our plants while supplying low-cost, reliable power."

Both TVA and the investor-owned utilities targeted by EPA's enforcement actions claim they are victims of an ex post facto rewrite of Clean Air Act rules. Under the Act, utilities must go through a lengthy permitting process and meet numerous strict standards before building a new facility or substantially modifying an existing one. Routine maintenance, on the other hand, does not trigger such tough requirements. Through its new enforcement initiatives, EPA essentially is reinterpreting the law, arguing that dozens of facility changes plant managers thought were routine maintenance actually count as major modifications. "All of TVA's activities meet the Clean Air Act's requirements as EPA has historically interpreted it," says Joe Bynum, executive vice president of the TVA Fossil Power Group. "Now, EPA is changing the rules," he adds.

If the investor-owned power plants lose, they will be subject to fines of up to $25,000 per day for violations that had gone on for many years, in addition to the high costs of bringing facilities into compliance with EPA's newly defined requirements. If TVA loses, EPA "could require TVA to spend up to $3 billion to comply," says Mr. Bynum. Ratepayers eventually will foot the bill, with TVA predicting an increase of up to 14 percent for its customers.

In addition, an EPA victory would mean that many routine power plant repairs will henceforth be held up with months of red tape, hampering ongoing operations. TVA and the other utilities are also concerned about the impact of EPA's actions on the reliability of the electricity supply, already a burgeoning problem throughout the country. Indeed, EPA has singled out for extra scrutiny facility maintenance projects the agency believes will result in "decreases in forced outages and curtailments attributable to break down of the component being replaced."

If EPA has its way, such projects would be delayed, if not prevented, potentially resulting in more frequent blackouts. As with many environmental "solutions," these measures are chasing a greatly overstated problem. Ambient ozone levels already are declining, by more than 30 percent since 1970, according to EPA figures. Reduced power plant emissions have contributed to this trend, which is likely to continue regardless of the outcome of the agency's latest crackdown. "Smog has declined substantially over the past three decades and will continue to decline, even without these actions against coal-fired power plants," says Kay Jones, former senior adviser on air quality to the President's Council on Environmental Quality during the Ford and Carter administrations. All the usual arguments made against EPA enforcement actions the alleged violations did not really occur, the proposed remedies will burden consumers and accomplish little for the environment tend to be dismissed as cheap excuses when coming from private corporations.

But they are often true, especially in recent years as the Clinton EPA has embarked on a number of aggressive enforcement efforts of questionable merit. Indeed, as Jonathan Adler documents in a May 2000 study for the Reason Public Policy Institute titled "Environmental Performance At The Bench: The EPA's Record In Federal Court," EPA now loses a substantial percentage of its legal challenges, due to its failure to follow the law.

The message that federal environmental enforcement has gotten badly off-track is slowly gaining believers. And in the case of EPA's latest attack on utilities, even the federal government itself has become one of them.



Ben Lieberman is a policy analyst with the Competitive Enterprise Institute.

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