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Energy Regs Hurt Job Creation

August 18, 2013 3 minute Read by Roger Meiners

Professional protesters can find injustice in any action taken. Build a new facility, and a business may be accused of not building it where it could provide more jobs for minorities. Build a facility where there is a large minority population, and the firm may be accused of imposing pollution on a minority population.

A volume published by Stanford, "The Political Economy of Environmental Justice," edited by Spencer Banzhaf, puts to rest the old assertion that firms build plants where they can impose environmental costs on minority and low-income populations. Never mind the facts: Unproven claims of injustice make for good copy and politics, so the EPA is pushing ahead to impose more regulations on firms wishing to construct new facilities, especially energy-using facilities.

Economic activity requires the use of energy. Even businesses we think of as “clean” need coal or natural gas to be burned to produce power. Google and other computer-based firms consume a huge amount of electricity at their server farms.

After many years in the works, EPA is putting the finishing touches on “policies and recommended procedures” for “assessment of potential EJ [Environmental Justice] concerns.” This is summarized in an 81-page publication, "Draft Technical Guidance for Assessing Environmental Justice in Regulatory Analysis." Fear not, EPA notes, these are not “regulations” that are “legally binding,” merely “guidance” as to how EPA will proceed.

EPA wishes to add EJ analysis to health and economic considerations in making regulations. This means “transparency and meaningful participation for minority, low-income and indigenous populations, and Tribes” in a rule-making process.  For example, suppose a regulation is related to mercury exposure that occurs as a result of a high rate of fish consumption. Who are the affected parties? “Laotian subsistence fishers” and “low-income African-American recreational and subsistence fishers.” Suppose a regulation concerns greenhouse-gas emissions for medium-heavy duty trucks. Who must be given special consideration? Minorities living within 500, 100, and 50 meters of roads that have such truck traffic. When considering the danger from a pesticide, one must consider if it could end up in “straw that is woven into baskets by American Indians.” You get the gist — anything is fair game for consideration, regardless of how trivial and remote the risk.

Because the EPA staff is mandated to consider every imaginable possibility, this will become a routine part of review of new regulations that apply to nearly every stitch of economic activity. There is no evidence to support the notion that businesses seek to dump pollutants on minorities or low-income people, but complying with the minutiae that can emerge from such analysis is a full-employment act for consultants and EPA bureaucrats who will impose higher costs on industry, thereby reducing opportunities for all.