A.G. Pruitt presses to clear the haze from EPA regional standards fight
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Published: 23-Aug-2013

OKLAHOMA CITY – State Attorney General Scott Pruitt is appealing a controversial Tenth U.S. Circuit Court decision slapping down an  “Oklahoma Plan” to abate regional haze.

Pruitt spoke at a Thursday forum, less than 24 hours after announcing he will ask the full appeals court to revisit federal regional haze standards first promulgated in 2011. 

Pruitt wants to give new life to the Sooner State’s approach, buying time for state regulators to advance alternatives to Environmental Protection Agency mandates. Oklahoma should follow an “all of the above” energy strategy, Pruitt says, incorporating use of coal, oil, natural gas, wind and other “renewables.” He opposes mandated fuel switching at power facilities. 

Last month, on a 2-1 vote, a three-judge appeals panel in Denver slapped down Oklahoma’s homegrown approach. Pruitt says, “Regional Haze is about aesthetics, not health, and states have a say in how the regulations are implemented. Part of that role is considering the cost to our consumers.” 

Joining Pruitt at Oklahoma City University – for “EPA Regulations and Your Pocketbook,” an Americans for Prosperity Foundation-Oklahoma forum -- were U.S. Rep. James Lankford, R-Oklahoma City, and William Yeatman, assistant director of the Center for Energy and Environment at the Competitive Enterprise Institute (CEI).

Yeatman said that EPA “overreach” will yield higher costs, less energy and greater risks. 

The feds’ haze rule, promulgated under the Clean Air Act, requires improved visibility at national parks and regional areas by the year 2064. A State Implementation Plan went to federal officials in 2010, aiming to reach haze abatement requirements by 2026.

But two years ago, EPA rebuffed the state guideline for the agency’s own. Critics contend that federal edict did not follow underlying legal strictures -- and some utility analysts project annual utility rate increases of 13 to 20 percent ($200 or more per customer) over three years.

Pruitt reflects, “Oklahoma stakeholders created a common sense plan that would accomplish that goal and improve our environment without forcing Oklahomans to pay unnecessary costs. The EPA exceeded its authority under the law by imposing their federal plan in Oklahoma.” 

Pruitt faces a Sept. 3 deadline to file the formal rehearing request, hoping that Judge Paul Kelly’s arguments will prove persuasive to a majority of the full court.

In the dissent, Judge Kelly said EPA’s actions were arbitrary in rejecting “Oklahoma’s evidentiary support with no clear evidence of its own to support its contrary conclusion.” He characterized Oklahoma’s position (to use scrubbers to clean coal emissions) as a “reasoned, detailed technical conclusion.”  

At the forum, Rep. Lankford described his frustration with scientific and economic analyses in EPA’s approach. Lankford said the event “was another opportunity to show how state and national leaders can work together to keep energy prices down by protecting the free market and state authority.”

Yeatman has criticized a utility, Public Service Company of Oklahoma, for announcing a switch from coal to natural gas at one northeast Oklahoma facility. Yeatman said state utilities are limited, because of EPA excesses, to only two options: “litigate and fight, or settle and placate.” 

PSO officials have defended their judgment in the matter, but Yeatman insists the fuel shift will result in $529 million in higher ratepayer costs in “net present value” – and reach $3 billion in nominal dollars.

The CEI analyst, in a report for AFP-Oklahoma, said the decision to change fuels will stress reserve margins for electricity through 2021, subjecting ratepayers to “rate shock.”

Days ago, the three-member state Corporation Commission bolstered Pruitt, AFP and their allies, unanimously denying pre-approval for PSO to recover fuel shifting costs from ratepayers. 

AFP’s state director, Matt Ball, contends federal haze standards – aesthetic rather than health-based -- will boost costs without improving the environment. 

Other issues are at play in the debate, including Pruitt’s efforts, in concert with other state attorneys general, to end exploitation of “sue and settle” tactics. The allied state AGs are seeking evidence to bolster contentions that EPA reacts to lawsuits from environmental groups with an inherent willingness to settle.

This pressures states, triggering missed compliance deadlines and empowering EPA to seize state functions.

Eight states, including Oklahoma, face $2.16 billion in compliance costs should the feds assume full control over haze standards. 

PSO, while not a fan of the EPA, says company policies have been guided by the best interests of ratepayers and shareholders, and not by a desire to placate the powerful federal agency. 

You may contact Patrick B. McGuigan at Patrick@capitolbeatok.com and follow us on Twitter: @capitolbeatok.

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