Snyder invites a federal energy takeover
Gov. Rick Snyder has announced he intends to help President Barack Obama impose national carbon regulations, the so-called “Clean Power Plan.” In a statement, Snyder claims implementing the federal rule is the “best way” to ensure Michigan “retains control of its energy future.”
The governor has it backwards. Implementing Obama’s carbon rule before the courts weigh in ensures Michigan’s energy decisions end up “in the hands of bureaucrats in Washington, D.C.”
Unfortunately, Snyder seems to have succumbed to Obama’s false choice: submit a state plan or have a federal plan foisted on you. The actual choice is whether to begin implementing this federal scheme before the serious legal challenges have a chance to play out.
Snyder should know better. After all, our state was the lead plaintiff in Michigan v. EPA, in which the U.S. Supreme Court remanded Obama’s mercury rule because EPA failed to adequately consider costs. Even though the courts ruled against EPA, it didn’t matter: in May, Consumers Energy announced it planned to close seven coal-fired power plants—32 percent of its coal fleet—by April 2016, exactly one year after the mercury rule took effect, since “it doesn’t make economic sense to spend more to keep them running.” The damage was already done.
Michigan is also taking EPA to court over the Clean Power Plan, joining 16 other states challenging the rule. Implementation before legal resolution harms the state’s effort to protect Michiganians from “yet another executive action taken by President Obama and the EPA that violates the Clean Air Act and causes the price of electricity to increase, placing jobs at risk and costing Michigan families more,” as Attorney General Bill Schuette puts it.
Other legal experts agree with our attorney general. Harvard law professor Laurence Tribe has described the regulation as “a total overhaul of each state's way of life” that amounts to “burning the Constitution.”
Beyond its legal infirmities, the rule is an economic disaster. Implementing it will require Michigan to uproot our electricity system, replacing low-cost coal that comprises almost half of our power with more expensive sources. An economic analysis of the proposed rule found it would raise electric rates on Michigan households by 12 percent, or about $140 per year. The final rule is even more severe, so costs will likely be higher.
By rushing to help Obama implement his rule, Michigan has little to gain but much to lose. It will ensure Obama’s EPA gets to mandate its favored energy sources while inflicting huge economic costs on Michiganians that cannot be undone if the courts later invalidate the rule.
Christopher Douglas is associate professor and chair of the economics department at the University of Michigan-Flint and is a member of the board of scholars at the Mackinac Center for Public Policy.