President Barack Obama announced sweeping rules aimed at reducing the use of coal in power plants, setting himself for a political and legal fight akin to the one he’s still waging over his signature health care program.
Obama on Monday said the new Environmental Protection Agency regulations to reduce U.S. power-plant emissions are the single most important step the country has taken to address climate change.
“There is such a thing as being too late when it comes to climate change,” Obama said at the White House. “This is one of those rare issues, because of its magnitude, because of its scope, that if we don’t get it right we may not be able to reverse” the impact on the earth.
The rules, estimated to cost $8.4 billion, drew fire from opponents even before they were released. As states have challenged requirements under the Affordable Care Act, Senate Majority Leader Mitch McConnell urged states to reject the power-plant regulations. States may be joined by coal producers and coal-reliant utilities in challenging the Environmental Protection Agency’s rule.
The administration will proceed with the rules in the face of opposition even if it means court challenges, White House press secretary Josh Earnest told reporters Monday, saying he’s “not aware of any specific plan” to delay them while court cases play out.
The impact of the rules will go beyond U.S. power industry as Obama uses them as leverage to pressure other countries to do more during the leadup to global climate talks in Paris in December.
The plan, to be put into place in the next couple of months, puts the U.S. on a path to cut emissions by 26 percent to 28 percent by 2025, according to the White House.
As the White House puts its cards on the table, the second-largest U.S. coal producer is folding its current hand and reshuffling.
Alpha Natural Resources declared bankruptcy this morning to get out from under $3.3 billion in debt accumulated over the past several years.
Several factors converged to bring about coal's collapse, of which Obama is only the easiest for coal industry leaders to blame. There's the U.S. natural gas boom, which gave power producers a cheaper, less-polluting alternative. Coal companies took on debt around 2011, when Chinese demand pushed prices up globally, according to Bloomberg. That binge has wound down since then, taking coal prices with it, and coal companies like Alpha Natural Resources are left holding the bill.
"The change and challenges the U.S. coal industry has experienced over the last several years are greater than any in the past three decades," said Alpha's chairman and chief executive officer, Kevin Crutchfield, in a press release. "There is no doubt more uncertainty ahead, but also transformational opportunity in the coal sector for those who make proactive, strategic decisions." Alpha sells its coal, from 50 mines, to power generators, steelmakers, and industrial companies.
While Alpha turns its attention inward, its peers are bracing for a fight. They have been for a while. Closely held Murray Energy today announced that it will file five lawsuits against the the Clean Power Plan, which, the company said in a release, "will adversely restructure the electric power system in America and will force every State to radically change their energy policies." Murray sued the EPA unsuccessfully last year, but the case was thrown out because the rules had not yet been finalized.