EPA Action on Sulfur Dioxide Points to Future Under Cap-and-Trade

The U.S. Environmental Protection Agency has announced it is drastically lowering the standard for sulfur dioxide under the Clean Air Act.

SO2 emissions come primarily from coal-fired power plants and are a primary cause of acid rain. The current standard for SO2 of 140 parts per billion averaged over 24 hours will be lowered to 75 parts per billion measured hourly (one part per billion is equivalent to one second during 33 years). The EPA claims the new standard will prevent 54,000 asthma attacks per year. Cost estimates for utilities to comply with the new standard range from $1.5 billion to $3 billion, which will result in higher energy bills for households and businesses.

Advocates of cap-and-trade legislation to limit greenhouse gases frequently point to the program of trading SO2 credits has a huge success, which they believe could  be replicated for CO2. That begs the question: If the SO2 trading program is such a success, why does the EPA find it necessary to significantly lower the SO2 standard through new rule making? Apparently the cap portion of cap-and-trade is much more important to the agency than is the trade portion.

The EPA's current action regarding SO2 emission standards is a good predictor of what the agency's approach would be if proposed national cap-and-trade legislation for CO2 becomes law.  President Obama has stated "electricity rates will necessarily skyrocket" if cap-and-trade becomes law. EPA through rule making will ratchet down the CO2 standards under such a system while consumers pay the bill.

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