When Opportunity Knocks, EPA Slams Door Shut in W.Va.
Workforce regulations. Tax regulations. Safety regulations. Environmental regulations. Sometimes I feel like Washington bureaucrats are completely out of touch with the working men and women of West Virginia.
Week after week, the Environmental Protection Agency ushers in new policies – and the costs to comply with these unending regulations translate far beyond the figures of dollars and cents. I’m talking about jobs. West Virginia jobs.
The latest potential EPA rollout for ground-level ozone emissions could be the most expensive regulation in our country’s history. It would cost the economy $270 billion per year and put millions of jobs at risk, according to a recent study by NERA Economic Consulting.
Under the Clean Air Act, the EPA must review national air quality standards for ozone emissions every seven years. In 2008, the EPA lowered ground-level ozone standards from 84 parts per billion (ppb) to 75 ppb.
Any time an air quality change is made, it then becomes the responsibility of each state to ensure that all counties and metropolitan areas are abiding by the standard. Regions not in compliance or above the ppb level are labeled as “nonattainment” areas. West Virginia could easily fall into a nonattainment category with the new 60 ppb level the EPA has proposed in its draft policy for ground-level ozone standards.
So how would West Virginia get to that lower 60 ppb standard – and at what cost?
The greatest expenses to comply with ozone regulations often occur in nonattainment areas. The consequences are alarming, and if West Virginia would ever fall into that category, it would be devastating.
There are a few ways our state could comply with the new regulations and avoid nonattainment. These would include simply preventing businesses from expanding or opening operations. Another avenue would be to shut down more coal-fired power plants,
Opportunity is knocking on our door, and the EPA is slamming it shut. West Virginia has the potential to reintroduce chemical manufacturing with the variety of opportunities now available because of the Marcellus Shale. The abundance of cheap natural gas makes a significant difference in production costs. Businesses are weighing the feasibility of expanding downstream plastics industry investments with the announcement of the pending cracker plant. Constructing an ethylene cracker plant, three separate polyethylene plastic resin plants and additional facilities for water treatment and energy generation in Wood County would create thousands of jobs. These new facilities would also reinforce our manufacturing base and attract new companies to our region. However, the largest single industrial project in the history of the state of West Virginia, the cracker plant, could be in jeopardy if the new ground-level ozone standards are adopted.
We would also need to shut down even more coal-fired power plants in order to reach ground-level ozone compliance. Thousands of West Virginians count on mining jobs. Our schools and communities count on the tax funding provided by coal mining. And the U.S. counts on electric generation from fossil fuels such as coal, petroleum and natural gas. These reliable, affordable domestic energy supplies foster our nation’s energy security.
Last year, Hino Motors Manufacturing USA announced 20 new jobs and direct investments of $2.9 million for machinery, equipment and improvements at the company’s Williamstown, W.Va., assembly plant. That operation is the only U.S. plant making fuel-efficient commercial trucks. Those trucks could actually help lower ground-level ozone emissions. But ironically, the Hino plant could face incredible costs, as new regulations would force manufactures to make technical and formula changes to their products and pay for replacement equipment.
Toyota Motor Manufacturing has expanded seven times since coming to the state in 1996, and with its new investment plans, employment would reach more than 1,000 with a total investment of $1.3 billion in Buffalo, W.Va. Allevard Sogefi USA invested $5.5 million to upgrade equipment and plans to grow its workforce to over 150 employees.
These are examples of our state government and workforce partnering with the business community and making investments into our region that create jobs and that will bring billions of dollars into West Virginia’s economy.
We cannot afford to lose industries and economic developments due to unattainable EPA standards from increased prices, delays, new equipment requirements and uncertainties from restrictive permitting. According to the NERA study, new ozone regulations could cost West Virginia $21 billion Gross State Product loss from 2017-40 and 14,276 jobs.
Beyond manufacturing and coal industries, ground-level ozone restrictions would effect every single layer of our economy. Businesses in the service sector could be required to install lower-emitting equipment for space heating, water heating and air conditioning. Scrapping or replacing recently purchased landscaping equipment with lower emitting versions could be costly.
Old service fleet vehicles or high-emitting commercial trucks could be scrapped along with personal vehicles and ATVS in order to meet the requirements. West Virginia consumers could experience up to a 15 percent increase in residential electricity prices and up to a 32 percent increase in gas prices.
West Virginia has weathered many storms over the years, but our state has worked hard to create a positive business climate. We were the only state to cut taxes in 2012. West Virginia’s economy was the third fastest-growing in the nation in 2013, according to the latest report on real Gross Domestic Product (GDP) by the Bureau of Economic Analysis (BEA).
If we can keep the EPA out of our way, we can grow West Virginia by leaps and bounds.
Eddy is chief executive officer of Eagle Manufacturing in Wellsburg.