RUTHFULLY YOURS

The Environmental Protection Agency’s political agenda hasn’t gotten any less reckless, but the news is that the rest of the government is beginning to notice—including a majority of the states and even other regulators. And now they are pushing back. This turn comes in the nick of time, since one of the EPA’s more destructive rules is due to be finalized next month.

At issue is the so-called utility rule that would impose new limits on mercury and other hazardous air pollutants. The regulation is the most costly in the EPA’s history in return for marginal benefits. It was rushed out to force a large portion of the country’s coal-fired power plants to shut down. On top of other such de facto anticarbon rules, this could compromise the reliability of the electric system if as much as 8% of generating capacity is subtracted from the grid.

The Federal Energy Regulatory Commission—which is charged with protecting reliability—admitted as much last year in a preliminary analysis, only to withdraw the document and refuse to update it. But now one of FERC’s five commissioners is calling out his own boss for this abdication.

In a recent letter to Alaska Senator Lisa Murkowski, who has been probing FERC, Commissioner Phillip Moeller admits, “I can’t affirm that EPA actions will not materially degrade reliability, nor can I speak for the entire Commission and how it will carry out its statutory obligations.” He added that FERC “should be involved in the rulemaking process of a federal agency if such involvement helps reduce threats to reliability.”

That’s precisely what FERC Chairman Jon Wellinghoff is refusing to do, perhaps as a favor to his political patron Harry Reid. The Chairman has broad powers over FERC’s work, much like a CEO, even if other commissioners dissent. The technical experts in the reliability office itself are also worried, as internal documents show. Mr. Moeller has repeatedly said he is “fuel neutral” but that as a Commissioner, “I cannot be neutral on the subject of reliability,” as he put it at a September hearing.

Mr. Moeller also dismisses Mr. Wellinghoff’s endorsement of a “safety valve” that would give FERC the power to overrule the EPA if it thinks its rules might lead to blackouts—but only after the fact. “I do not know what exemption process would work best for administering what may become a complex task of determining which set of power plants will need to operate for reliability purposes,” Mr. Moeller writes. In other words, no regulator has the omniscience to decide which plants are “must run” and therefore deserving of a safety-valve exemption. The only way we’ll know is after there’s a disaster.

This week FERC said it would convene a reliability conference, but by the time it arrives in November it will be too late to convince the EPA to publish a more reasonable rule. The Texas utility Luminant has already shuttered two coal plants (farewell, 500 jobs) in response to the regulatory cascade, and many more closures are on the way.

Meanwhile, 11 Governors last week wrote to the EPA to protest the utility rule, warning that “full-time power availability could be at risk.” And earlier this week 25 state Attorneys General—including four Democrats—filed suit to lift a legal document known as a consent decree that the EPA is using as a fig leaf for its political goals.

This 2008 court order says the utility rule must be issued by November, which is how the EPA justifies its aggressive political schedule. But the EPA wrote the consent decree and explicitly says, “If EPA needs more time to get it right, it can seek more time.” EPA, naturally, hasn’t done so—despite major errors in the proposal including one that confused “megawatts” with “gigawatts” and thereby set emissions standards that were incorrect by a factor of 1,000.

Between the Governors and AGs, some 27 states are merely asking the EPA to delay the final rule until the risks can be properly quantified, which is also Senator Murkowski’s request. Despite the poor quality of its work, EPA has refused to slow down. While the new protests are welcome, at this point the only thing that will pull back the throttle is a White House intervention.