    [House Hearing, 112 Congress]
    [From the U.S. Government Publishing Office]

                 H.R. ___, THE ENERGY TAX PREVENTION ACT OF 2011

    =======================================================================

                                    HEARING

                                   BEFORE THE

                        SUBCOMMITTEE ON ENERGY AND POWER

                                     OF THE

                        COMMITTEE ON ENERGY AND COMMERCE
                            HOUSE OF REPRESENTATIVES

                          ONE HUNDRED TWELFTH CONGRESS

                                 FIRST SESSION

                                   ----------

                                FEBRUARY 9, 2011

                                   ----------

                                Serial No. 112-2

          Printed for the use of the Committee on Energy and Commerce

                            energycommerce.house.gov
                H.R. ___, THE ENERGY TAX PREVENTION ACT OF 2011

                H.R. ___, THE ENERGY TAX PREVENTION ACT OF 2011

    =======================================================================

                                    HEARING

                                   BEFORE THE

                        SUBCOMMITTEE ON ENERGY AND POWER

                                     OF THE

                        COMMITTEE ON ENERGY AND COMMERCE
                            HOUSE OF REPRESENTATIVES

                          ONE HUNDRED TWELFTH CONGRESS

                                 FIRST SESSION

                                   __________

                                FEBRUARY 9, 2011

                                   __________

                                Serial No. 112-2

          Printed for the use of the Committee on Energy and Commerce

                            energycommerce.house.gov

                      U.S. GOVERNMENT PRINTING OFFICE
    65-734                    WASHINGTON : 2011
    -----------------------------------------------------------------------
    For sale by the Superintendent of Documents, U.S. Government Printing Office,
    http://bookstore.gpo.gov. For more information, contact the GPO Customer Contact Center, U.S. Government Printing Office. Phone 202�09512�091800, or 866�09512�091800 (toll-free). E-mail, gpo@custhelp.com.

                        COMMITTEE ON ENERGY AND COMMERCE

                              FRED UPTON, Michigan
                                     Chairman

    JOE BARTON, Texas                    HENRY A. WAXMAN, California
      Chairman Emeritus                    Ranking Member
    CLIFF STEARNS, Florida               JOHN D. DINGELL, Michigan
    ED WHITFIELD, Kentucky                 Chairman Emeritus
    JOHN SHIMKUS, Illinois               EDWARD J. MARKEY, Massachusetts
    JOSEPH R. PITTS, Pennsylvania        EDOLPHUS TOWNS, New York
    MARY BONO MACK, California           FRANK PALLONE, Jr., New Jersey
    GREG WALDEN, Oregon                  BOBBY L. RUSH, Illinois
    LEE TERRY, Nebraska                  ANNA G. ESHOO, California
    MIKE ROGERS, Michigan                ELIOT L. ENGEL, New York
    SUE MYRICK, North Carolina           GENE GREEN, Texas
      Vice Chair                         DIANA DeGETTE, Colorado
    JOHN SULLIVAN, Oklahoma              LOIS CAPPS, California
    TIM MURPHY, Pennsylvania             JANE HARMAN, California
    MICHAEL C. BURGESS, Texas            JAN SCHAKOWSKY, Illinois
    MARSHA BLACKBURN, Tennessee          CHARLES A. GONZALEZ, Texas
    BRIAN BILBRAY, California            JAY INSLEE, Washington
    CHARLIE BASS, New Hampshire          TAMMY BALDWIN, Wisconsin
    PHIL GINGREY, Georgia                MIKE ROSS, Arkansas
    STEVE SCALISE, Louisiana             ANTHONY D. WEINER, New York
    BOB LATTA, Ohio                      JIM MATHESON, Utah
    CATHY McMORRIS RODGERS, Washington   G.K. BUTTERFIELD, North Carolina
    GREGG HARPER, Mississippi            JOHN BARROW, Georgia
    LEONARD LANCE, New Jersey            DORIS O. MATSUI, California
    BILL CASSIDY, Louisiana
    BRETT GUTHRIE, Kentucky
    PETE OLSON, Texas
    DAVID McKINLEY, West Virginia
    CORY GARDNER, Colorado
    MIKE POMPEO, Kansas
    ADAM KINZINGER, Illinois
    MORGAN GRIFFITH, Virginia

                                      (ii)
                        Subcommittee on Energy and Power

                             ED WHITFIELD, Kentucky
                                     Chairman
    JOHN SULLIVAN, Oklahoma              BOBBY RUSH, Illinois
      Vice Chair                           Ranking Member
    JOHN SHIMKUS, Illinois               JAY INSLEE, Washington
    GREG WALDEN, Oregon                  JIM MATHESON, Utah
    LEE TERRY, Nebraska                  JOHN D. DINGELL, Michigan
    MICHAEL C. BURGESS, Texas            EDWARD J. MARKEY, Massachusetts
    BRIAN BILBRAY, California            ELIOT L. ENGEL, New York
    STEVE SCALISE, Louisiana             GENE GREEN, Texas
    CATHY McMORRIS RODGERS, Washington   LOIS CAPPS, California
    PETE OLSON, Texas                    MIKE DOYLE, Pennsylvania
    DAVID MCKINLEY, West Virginia        JANE HARMAN, California
    CORY GARDNER, Colorado               HENRY A. WAXMAN, California (ex
    MIKE POMPEO, Kansas                      officio)
    MORGAN GRIFFITH, Virginia
    JOE BARTON, Texas
    FRED UPTON, Michigan (ex officio)

                                 C O N T E N T S

                                  ----------
                                                                       Page
    Hon. Ed Whitfield, a Representative in Congress from the
      Commonwealth of Kentucky, opening statement....................     1
        Prepared statement...........................................     3
    Hon. Bobby Rush, a Representative in Congress from the State of
      Illinois, opening statement....................................     4
    Hon. Fred Upton, a Representative in Congress from the State of
      Michigan, opening statement....................................     6
        Prepared statement...........................................     7
    Hon. Joe Barton, a Representative in Congress from the State of
      Texas, opening statement.......................................     7
        Prepared statement...........................................     8
    Hon. Henry A. Waxman, a Representative in Congress from the State
      of California, opening statement...............................     9
    Hon. John D. Dingell, a Representative in Congress from the State
      of Michigan, prepared statement................................    23
    Hon. John Sullivan, a Representative in Congress from the State
      of Oklahoma, prepared statement................................   308
    Hon. David McKinley, a Representative in Congress from the State
      of West Virginia, prepared statement...........................   309
    Hon. Cory Gardner, a Representative in Congress from the State of
      Colorado, prepared statement...................................   309
    Hon. Lois Capps, a Representative in Congress from the State of
      California, prepared statement.................................   311

                                   Witnesses

    James Inhofe, U.S. Senator, State of Oklahoma....................    10
        Prepared statement...........................................    13
    Lisa Jackson, Administrator, Environmental Protection Agency.....    26
        Prepared statement...........................................    28
        Answers to submitted questions \1\...........................
    Greg Abbott, Attorney General, State of Texas....................    72
        Prepared statement...........................................    74
    Harry C. Alford, President and CEO, National Black Chamber of
      Commerce.......................................................    89
        Prepared statement...........................................    91
    Steve Rowlan, General Manager, Environmental Affairs, Nucor
      Corporation....................................................    99
        Prepared statement...........................................   101
    James Pearce, Director of Manufacturing, FMC Corporation.........   104
        Prepared statement...........................................   106
    Steve Cousins, Vice President, Lions Oil Company.................   113
        Prepared statement...........................................   115
    Lonnie N. Carter, President and CEO, Santee Cooper...............   129
        Prepared statement...........................................   131
    Betsey Blaisdell, Senior Manager of Environmental Stewardship,
      The Timberland Company.........................................   146
        Prepared statement...........................................   149
    Peter S. Glaser, President, Troutman Sanders LLP.................   185
        Prepared statement...........................................   188
    Margo Thorning, Senior Vice President and Chief Economist,
      American Council for Capital Investment........................   227
        Prepared statement...........................................   229
    Philip Nelson, President, Illinois Farm Bureau...................   241
        Prepared statement...........................................   243
    Fred T. Harnack, General Manager, Environmental Affairs, U.S.
      Steel Corporation..............................................   251
        Prepared statement...........................................   253
    James N. Goldstene, Executive Officer, California Air Resources
      Board..........................................................   277
        Prepared statement...........................................   279
        Answers to submitted questions...............................   656
    Lynn R. Goldman, American Public Health Association..............   287
        Prepared statement...........................................   289

                               Submitted Material

    ``Comments on Draft Technical Support Document for Endangerment
      Analysis for Greenhouse Gas Emissions under the Clean Air
      Act,'' report by Alan Carlin, submitted by Mr. Barton..........   312
    EPA White Paper, dated February 8, 2011..........................   408
    Letter of February 9, 2011, signed by 1,800 professionals from
      all 50 States, submitted by Ms. Capps..........................   420
    ``American Lung Association Urges Congress to Reject Chairman
      Upton's Clean Air Act Bill, press release, dated February 2,
      2011, submitted by Ms. Capps...................................   438
    Communication from former EPA Administrator Stephen Johnson to
      former President George W. Bush, submitted by Mr. Waxman.......   442
    Statement of Mark Z. Jacobson of Stanford University, submitted
      by Mr. Inslee..................................................   486
    Statement of David Gardiner, Executive Director, Alliance for
      Industrial Efficiency, submitted by Mr. Waxman.................   497
    Statements and letters from various organizations, submitted by
      Mr. Rush.......................................................   504
    Statement of National Association of Realtors, submitted by Mr.
      Whitfield......................................................   646

    ----------
    \1\ Ms. Jackson did not respond to submitted questions for the
      record.

                H.R. ___, THE ENERGY TAX PREVENTION ACT OF 2011

                                  ----------

                           THURSDAY, FEBRUARY 9, 2011

                      House of Representatives,
                      Subcommittee on Energy and Power,
                              Committee on Energy and Commerce,
                                                        Washington, DC.
        The subcommittee met, pursuant to call, at 9:38 a.m., in
    room 2123 of the Rayburn House Office Building, Hon. Ed
    Whitfield (chairman of the subcommittee) presiding.
        Members present: Representatives Whitfield, Sullivan,
    Shimkus, Walden, Terry, Burgess, Scalise, McMorris Rodgers,
    Olson, McKinley, Gardner, Pompeo, Griffith, Barton, Upton (ex
    officio), Rush, Inslee, Matheson, Dingell, Markey, Engel,
    Green, Capps, Doyle, and Waxman (ex officio).
        Staff present: Mary Neumayr, senior energy counsel; Peter
    Spencer, professional staff member; Maryam Brown, chief
    counsel, Energy and Power; Elizabeth Lowell, legislative
    clerk;, Ben Lieberman, counsel; Cory Hicks, policy coordinator,
    Energy and Power; Phil Barnett, democratic staff director; Greg
    Dotson, democratic chief counsel, Energy and Power; Alexandra
    Teitz, senior democratic counsel; and Caitlin Haberman,
    democratic policy analyst.

      OPENING STATEMENT OF HON. ED WHITFIELD, A REPRESENTATIVE IN
               CONGRESS FROM THE COMMONWEALTH OF KENTUCKY

        Mr. Whitfield. I would like to call this hearing to order
    this morning. The topic of our hearing, it is a legislative
    hearing on the Energy Tax Prevention Act of 2011. I certainly
    want to welcome the members of the subcommittee. I look forward
    to working with all of you as we seek to craft an energy and
    environmental strategy and policy that will be in the best
    interest of the American people, and I believe that can best be
    accomplished by Congress and the EPA working together. Congress
    intends to reassert itself in the statutory and regulatory
    process at EPA.
        I am pleased to be serving again with my friend and
    colleague, the ranking member, Mr. Rush. We served on the CTCP
    Subcommittee in the last Congress, and I look forward to
    working with him as well as all members of the subcommittee.
        I also want to thank our witnesses today and thank them for
    being here to help us look at this very important issue. We are
    going to have four panels of witnesses today, and all of them
    are going to provide us with information that is going to be
    helpful as we move forward.
        Today's hearing is going to focus on greenhouse gas
    rulemaking within the Environmental Protection Agency that many
    of us believe attempts to address an issue properly within the
    purview of the Congress, and then we are also going to be
    talking about legislation that has been introduced that would
    restore the proper balance to decision-making affecting
    greenhouse gases.
        The Obama Administration has been the most aggressive in
    recent memory. As a matter of fact, six rules were issued on
    Christmas Eve and there is a pipeline full of regulations
    waiting to be issued, and States frequently are not being given
    adequate time to reexamine and rewrite State implementation
    plans to respond to this aggressive pace. I, like others, have
    been besieged with calls from entities all over the country
    complaining about EPA's attempt to regulate greenhouse gases.
    Congress has made its will crystal clear on this issue. Our
    esteemed colleague, Chairman Emeritus John Dingell on the
    Democratic side, who led the negotiations on the 1990 Clean Air
    Act Amendments, wrote, ``I would have difficulty concluding the
    House-Senate conferees who rejected the Senate greenhouse gas
    regulatory provisions contemplated regulating greenhouse gas
    emissions or addressing global warming under the Clean Air
    Act.'' As recently as 2008, Mr. Dingell warned that regulating
    greenhouse gases under the Clean Air Act rather than new
    legislation would lead to, as he said, glorious mess. And then
    on July 25, 1997, Senate Resolution 98 expressing the sense of
    the Senate that the United States not be a signatory to the
    Kyoto Protocol that would have required the United States to
    reduce greenhouse gas emissions was approved by the Senate by a
    vote of 95 to nothing. And when the 111th Congress revisited
    this issue last year, it responded with a resounding no to
    regulating greenhouse gases by not passing the so-called cap-
    and-trade bill.
        Although Congress has made its position abundantly clear
    not to regulate greenhouse gases, we now have a bureaucracy,
    unelected staff at EPA and the courts pushing the United States
    down a path that in my opinion will cost jobs and make us less
    competitive in the global marketplace. Furthermore, what is
    worse about this is that technology is not available to capture
    greenhouse gases, and we do not have any idea what the cost
    versus the benefits will be. And if the tailoring rule is
    determined to be a violation of the Clean Air Act, which is
    certainly possible, EPA applying the statutes permitting these
    thresholds has estimated that over 6 million sources in our
    country would need to obtain Title V operating permits and also
    it would lead to 82,000 permitting actions annually under the
    preventing significant deterioration formula, and it has also
    been estimated at EPA that doing that would estimate a cost of
    $22.5 billion it would cost permitting authorities in the
    United States.
        So good energy policy is about expanding choices. All of us
    know that our energy demands are going to basically double by
    the year 2035 and we are going to need energy from all sources
    to meet the demands of this country. We are going to
    renewables, we are going to need natural gas, coal, nuclear,
    everything, and I do get the sense that sometimes those people
    who are pushing this country down a quick pathway to green
    energy are more interested in putting fossil fuels out of
    business than they are working to solve this problem. We
    recognize that we have to have energy from all sources.
        So I am delighted that you are here today. We look forward
    to the testimony of all of you.
        [The prepared statement of Mr. Whitfield follows:]

                    Prepared Statement of Hon. Ed Whitfield

        Good morning, and welcome to Members of the Subcommittee. I
    look forward to working with all of you as we seek to craft
    energy and environmental policies that will be in the best
    interests of the American people. That can best be accomplished
    by Congress and EPA working together. Congress intends to
    reassert itself in the statutory and regulatory process at EPA
    and specifically the Clean Air Act.
        I am pleased to be serving again with my friend and
    colleague, the Ranking Member, Mr. Rush. We served on the CTCP
    subcommittee in the last Congress and I look forward to working
    with him and all members of this subcommittee.
        I would also like to welcome our witnesses, and thank them
    for being here and for their contributions to today's
    discussions.
        Today's hearing will focus on a greenhouse gas (GHG)
    rulemaking within the Environmental Protection Agency that many
    of us believe attempts to address an issue properly within the
    purview of the Congress, and legislation that would restore the
    proper balance to decision-making affecting it.
        The Obama Administration EPA has been the most aggressive
    in recent memory. Six rules were issued on Christmas Eve and
    there is a pipeline full of regulations waiting to be issued
    and states are not being given adequate time to examine and re-
    write state implementation plans to respond to this aggressive
    pace.
        I have been besieged with calls from entities all over the
    country complaining about EPA's attempt to regulate greenhouse
    gases. Congress has made its will crystal clear on this issue.
    Our esteemed colleague, Chairman Emeritus John Dingell, who led
    the negotiations on the 1990 Clean Air Act amendments wrote,
    ``I would have difficulty concluding that the House-Senate
    conferees, who rejected the Senate (greenhouse gas) regulatory
    provisions.contemplated regulating greenhouse gas emissions or
    addressing global warming under the Clean Air Act.'' As
    recently as 2008, he warned that regulating GHG's under the
    Clean Air Act rather than new ...legislation would lead to a
    ``glorious mess."
        On July 25, 1997, S. Resolution 98, expressing the sense of
    the Senate that the United States not be a signatory to the
    Kyoto Protocol that would have required the United States to
    reduce greenhouse gas emissions was approved by a vote of 95 to
    0.
        When the 111th Congress revisited this issue last year, it
    responded with a resounding no to regulating greenhouse gases
    by not passing the so called ``Cap and Trade'' bill.
        Although Congress has made its position abundantly clear
    not to regulate GHG's, we now have unelected staff at EPA and
    the Courts pushing the United States down a path that in my
    opinion will cost jobs and make us less competitive in the
    global market place. Furthermore, the technology is not
    available to capture greenhouse gases and we do not have any
    idea what the cost vs. benefits will be. If the tailoring rule
    is determined to be a violation of the Clean Air Act, EPA
    applying the statues permitting thresholds has estimated that
    over 6 million sources would need to obtain Title 5 Operating
    Permits and also that it would lead to 82,000 permitting
    actions annually under PSD, resulting in an estimated cost of
    22.5 billion dollars to permitting authorities.
        President Obama and Administrator Jackson have said their
    efforts to regulate GHGs will be considerably costlier and less
    workable than the legislation Congress rejected last year.
        Good energy policy is all about expanding choices -
    including allowing the increased use of coal if the American
    economy needs it. There's a role for alternatives, but only to
    the extent they can compete on a level playing field with
    conventional energy and don't drive up energy costs for
    consumers and businesses. Many of us are concerned that EPA's
    regulations are all about artificially raising the cost of
    using coal and other fossil fuels in order to drive them out of
    the marketplace - in other words, reducing energy choices.
        There's a reason other manufacturing nations, including
    China, are not considering anything even remotely like these
    EPA regulations. They recognize the obvious fact that higher
    energy costs at home will send jobs abroad. Manufacturers in
    China are doing just fine without us handing them a comparative
    advantage with these EPA regulations.
        Let's face it, these regulations and others from EPA amount
    to a war on domestic coal. Coal is the energy source America
    possesses in the greatest abundance. It provides half the
    nation's electricity and 92 percent in my home state of
    Kentucky, and it does so because it is affordable.
        Without coal, residential electric bills would be higher,
    and many energy-using manufacturers would be at a global
    disadvantage compared to other nations that don't hesitate to
    use it.
        For example, in Webster County, Kentucky, we have an
    aluminum manufacturing company, which molds aluminum for
    various products around the world. This facility employs 500
    people in a county with a population of roughly 15,000. EPA's
    regulations will most certainly raise electricity rates to a
    point where these smelters and those jobs will move overseas.
        In addition, without coal, hundreds of thousands of miners
    and others who derive their livelihoods from coal would be out
    of work, and many communities would suffer. In Kentucky, miners
    represent 17,000 people and the indirect impacts of coal keep
    the Commonwealth's economic engine running.
        EPA's global warming regulations are tailor-made to raise
    energy costs for customers of any utility or manufacturer that
    wants to use coal as a fuel source. But EPA's war on coal goes
    beyond that. The agency's decision to revoke a mine permit in
    West Virginia that had already been approved, coupled with
    burdensome new regulations under the Clean Water Act, raise
    troubling questions whether EPA has lost sight of its
    environmental protection role and is trying to set industrial
    policy.
        Of course, in order to meet our energy demand and continue
    to grow our economy, we need all energy sources, including
    coal, natural gas, oil, nuclear and renewables.
        I'm not going to support anything that threatens our
    economic recovery and I will oppose anything that will weaken
    our economy or make us less competitive in the global market
    place. For these reasons, I support the Energy Tax Prevention
    Act, which will properly reassert Congress' authority in this
    area.
        I look forward to hearing from our witnesses and I now
    recognize the Ranking Member of the Subcommittee, Mr. Rush.
                                  ----------

        Mr. Whitfield. At this time I would like to recognize the
    gentleman from Illinois, the ranking member of the
    subcommittee, Mr. Rush, for 5 minutes for his opening
    statement.

       OPENING STATEMENT OF HON. BOBBY RUSH, A REPRESENTATIVE IN
                  CONGRESS FROM THE STATE OF ILLINOIS

        Mr. Rush. Thank you, Mr. Chairman, and I want to thank you
    very much for this opportunity. I want to congratulate you on
    your selection to become chairman of the Energy and Power
    Subcommittee. As you have indicated, I too enjoyed very much
    working with you when you were the ranking member of the
    Subcommittee on Commerce, Trade, and Consumer Protection. You
    and I worked together hand and hand to move a lot of
    legislation through the subcommittee in the 111th Congress, and
    I look forward to the same outcomes in the 112th Congress.
        Unfortunately, I can't say that the discussion draft that
    we are taking up today exemplifies good legislation. Before
    delivering my opening statement, Mr. Chairman, I want to get a
    few things off my chest. I really have a bone to pick. I know
    that this is a new Congress and a new majority has come in with
    it. That said, our committee rules, procedures and decorum have
    remained substantially the same. Mr. Chairman, if we are not
    careful to set the right course of action moving forward, we
    will find ourselves lost in a sea of confusion, and we get our
    sea legs underneath us, we must try to do better.
        I am extremely troubled by the Majority's stubborn
    resistance to inviting credible witnesses at this hearing who
    think and believe the EPA has a duty and the authority under
    the Clean Air Act to regulate greenhouse gases. Stacking
    different cards with the same suit will rig the outcome before
    the first hand is even dealt. But that isn't what the American
    people and the American taxpayer want, and that is certainly
    not what they deserve. This is the House of Representatives. We
    represent all the American people and all businesses and public
    interest, not just some of them or the ones who support what we
    and our little circles want to do and desire to do.
        As I said earlier, this hearing's focus is on a legislative
    draft known as the Upton-Inhofe Energy Tax Prevention Act. The
    draft bill will eviscerate the EPA by repealing indispensable
    responsibility and authority the agency holds under the Clean
    Air Act to preserve and protect human health, our environment,
    and to promote more efficient use of energy. It would further
    overturn a Supreme Court decision affirming a lower court's
    ruling that the EPA has the authority to regulate greenhouse
    gases and it would prohibit the State of California from
    regulating greenhouse gas emissions from automobiles as well as
    stop the EPA from taking further steps in reducing tailpipe
    emissions. Mr. Chairman, it goes without saying that this
    proposal before us overreaches by large limits, and Mr.
    Chairman, this gets me to what my big rub is today. What
    irritates me the most is the Majority's refusal to invite the
    Administrator of the EPA, Ms. Lisa Jackson, to testify at
    today's hearing. The only reason that Administrator Jackson is
    appearing before us today is because we here in the Majority
    had to kick and scream and scratch so that Madam Administrator
    could have her day and the opportunity to defend her agency's
    findings and judgments here in the halls of Congress. How can
    we formulate good public policy or look at ourselves as fair
    and decent lawmakers if Congress as a body doesn't solicit the
    expert views of the EPA on this legislation? And as a Member of
    Congress, I want to hear as many pertinent viewpoints as I am
    able to hear before deciding how to cast my votes on pieces of
    legislation that are critical to the welfare of our economy,
    our own safety as human beings and preservation of our planet.
        Mr. Chairman, it goes without saying that we should not
    have to push this hard to get key officials and important
    witnesses invited to hearings of this magnitude, and that is
    one reason why, Mr. Chairman, I ask for unanimous consent to
    enter into the record a response dated December 8, 2010, to a
    Wall Street Journal editorial entitled ``The EPA Permitorium.''
    Mr. Chairman, with that said, I yield back the balance of my
    time.
        Mr. Whitfield. I thank the gentleman for that opening
    statement, and we do look forward to hearing Ms. Jackson. She
    will be here on the second panel, and we all will look forward
    to her testimony.
        At this time I would like to recognize for 5 minutes the
    chairman of the committee, Mr. Upton of Michigan.

       OPENING STATEMENT OF HON. FRED UPTON, A REPRESENTATIVE IN
               CONGRESS FROM THE COMMONWEALTH OF MICHIGAN

        Mr. Upton. Well, thank you, Mr. Chairman. It is a delight
    to be here, and I would just open my remarks by saying that it
    was the Minority that asked for Administrator Lisa Jackson to
    come, and we are delighted to have her, and with nature, she
    has got a good parking place right outside the door as well. In
    all seriousness, that was the Minority's request and we are
    certainly delighted to make sure that it happened.
        This hearing really is about job creation. It is a simple
    goal but unfortunately one that Washington lost sight of in the
    last few years. No more. Cap-and-trade legislation failed in
    the last Congress in that it did not get through the Senate or
    to the President's desk but now we face the threat of the EPA
    bureaucrats imposing the same agenda through a series of
    regulations. Like cap and trade, these regulations would boost
    the cost of energy not just for homeowners and car owners but
    for businesses large and small. EPA may be starting by
    regulating only the largest power plants and factories but we
    will all feel the impact of higher prices and fewer jobs.
        These regs go after emissions of carbon dioxide, the
    unavoidable byproduct of using coal, oil and natural gas that
    provides the Nation with 85 percent of its energy. These fossil
    fuels are such an important part of our energy mix because they
    are often the most affordable choice. EPA regs seek to take
    away that choice by making the use of these fuels prohibitively
    expensive. It is worth noting that for all the mentions of
    clean energy in the President's State of the Union, he never
    once mentioned keeping energy affordable. Affordable energy is
    what keeps our economy moving.
        We live in a global marketplace filled with manufacturers
    working to produce high-quality goods at the lowest cost. I
    know American manufacturers can compete but not if they are
    saddled with burdensome regs that put us at a distinct, unfair
    disadvantage.
        Needless to say, the Chinese government and other
    competitors have no intention of burdening and raising the cost
    of doing business for their manufacturers and energy producers
    the way EPA plans to do here in America. Our goal should be to
    export goods, not jobs.
        To do that, we released a draft, and it is a draft, called
    the Energy Tax Prevention Act. This is a bill that would
    protect jobs and preserve the intent of the Clean Air Act. It
    is narrowly crafted. It specifically targets the EPA's regs
    under the Clean Air Act that regulate carbon dioxide and other
    greenhouse gases as related to climate change. It allows States
    to continue setting climate policy as they please, but prevents
    those actions from being imposed or enforced nationally. It
    leaves in place the tailpipe standards for cars and light
    trucks from model years 2012 through 2016, and allows NHTSA to
    continue to regulate fuel economy after 2016.
        I have mentioned what this proposal does, but let me also
    emphasize what it does not do. It does not weaken the Clean Air
    Act. It does not limit EPA's ability to monitor and reduce
    pollutants that damage public health. I have looked back at the
    comments made by the authors of the revisions to the Clean Air
    Act in the early 1990s, and I am confident that our bill
    actually restores the Clean Air Act to its intended purpose.
        I yield the balance of my time to Chairman Emeritus Joe
    Barton from Texas.
        [The prepared statement of Mr. Upton follows:]

                     Prepared Statement of Hon. Fred Upton

        Job creation. It's a simple goal, but unfortunately, one
    Washington lost sight of in the last few years. Well, no more.
        Cap and trade legislation failed in the last Congress, but
    now we face the threat of Environmental Protection Agency
    bureaucrats imposing the same agenda through a series of
    regulations.
        Like cap and trade, these regulations would boost the cost
    of energy, not just for homeowners and car owners, but for
    businesses both large and small. EPA may be starting by
    regulating only the largest power plants and factories, but we
    will all feel the impact of higher prices and fewer jobs.
        These regulations go after emissions of carbon dioxide -
    the unavoidable byproduct of using the coal, oil, and natural
    gas that provides this nation with 85 percent of its energy.
    These fossil fuels are such an important part of our energy mix
    because they are often the most affordable choice. EPA
    regulators seek to take away that choice by making the use of
    these fuels prohibitively expensive.
        It's worth noting that for all the mentions of ``clean''
    energy in the President's State of the Union, he never once
    mentioned keeping energy ``affordable.'' ``Affordable'' energy
    is what keeps our economy moving.
        We live in global marketplace filled with manufacturers
    working to produce high quality items at the lowest cost. I
    know American manufacturers can compete - but not if they are
    saddled with burdensome regulations that put us at an unfair
    disadvantage.
        Needless to say, the Chinese government and other
    competitors have no intention of burdening and raising the cost
    of doing business for their manufacturers and energy producers
    the way EPA plans to here in America. Our goal should be to
    export goods, not jobs.
        To do that, we have released a draft proposal called the
    Energy Tax Prevention Act. This is a bill to protect jobs and
    preserve the intent of the Clean Air Act.
        Our proposal is narrowly crafted.
        It specifically targets the EPA's regulations under the
    Clean Air Act that regulate carbon dioxide and other greenhouse
    gases as related to climate change.
        It allows states to continue setting climate policy as they
    please, but prevents those actions from being imposed or
    enforced nationally.
        It leaves in place the tailpipe standards for cars and
    light trucks from model years 2012 through 2016, and allows
    NHTSA to continue to regulate fuel economy after 2016.
        I've mentioned what this proposal does, but let me also
    emphasize what it does NOT do. It does not weaken the Clean Air
    Act. It does not limit EPA's ability to monitor and reduce
    pollutants that damage public health. Let me repeat that: this
    bill does NOT impact EPA's ability to reduce pollutants that
    damage public health. I have looked back at the comments made
    by the authors of the revisions to the Clean Air Act in the
    early 1990s, and I am confident that our bill actually restores
    the Clean Air Act to its intended purpose.

       OPENING STATEMENT OF HON. JOE BARTON, A REPRESENTATIVE IN
                    CONGRESS FROM THE STATE OF TEXAS

        Mr. Barton. Well, thank you, Chairman Upton.
        Welcome, Senator Inhofe, former House member and good
    friend and senior member of the other body. We are glad to have
    your comments. I also want to welcome my Attorney General, Greg
    Abbott, my good friend from Austin, Texas, and the General
    Manager for Environmental Affairs of Nucor Corporation, Mr.
    Steve Rowlan, who has several manufacturing facilities in my
    district.
        The great Joe Louis, the heavy champion of the mid-1900s,
    was facing a difficult test with another heavyweight contender,
    and made the comment, ``He can run but he can't hide.'' Well,
    today we are going to use that in the legislative arena. The
    Environmental Protection Agency and the Obama Administration
    have decided basically just because they have the ability to
    decide as the executive branch that they want to put the
    American economy in a straitjacket and cost us millions of jobs
    and hundreds of billions of dollars a year with these
    greenhouse gas regulations. They couldn't get it through the
    legislative process. The Markey-Waxman bill in the last
    Congress barely passed the House and it did not go anywhere in
    the Senate so they tried to do it by a regulatory approach. It
    is not going to work. Chairman Upton and Subcommittee Chairman
    Whitfield have introduced this draft legislation, and I fully
    expect in the next month or two that it is going to pass the
    subcommittee and the full committee.
        So today we are going to start that legislative process. I
    am going to put into the record some comments from one of the
    EPA officials who had the authority at the time to take a look
    at the proposed endangerment finding, and I am going to read
    from the executive summary one sentence and then yield back the
    balance of Mr. Upton's time. It says, ``In many cases, the most
    important arguments are based not on multimillion-dollar
    research efforts but by simple observation of available data
    which has surprisingly received so little scrutiny. In the end,
    it must be emphasized that the issue is not which side has
    spent the most money or pushed the most peer-reviewed papers,
    the issue is whether the greenhouse gas CO2
    hypothesis meets the ultimate scientific test: conformance with
    real-world data.'' What these comments show is that in this
    case the ultimate test, the hypothesis fails. That is why we
    have put this legislation forward and that is why at the
    appropriate time it is going to pass and go to the House floor.
        With that, I yield back.
        [The prepared statement of Mr. Barton follows:]

                     Prepared Statement of Hon. Joe Barton

        Thank you Chairman for holding this important hearing. As
    Chairman Emeritus, I stand with Chairman Upton and Subcommittee
    Chairman Whitfield in support of denying bureaucrats at the
    Environmental Protection Agency (EPA) the right to regulate
    greenhouse gases under the Clean Air Act; and beginning to
    rebalance the power between the executive and the legislative
    branches.
        For the past 2 years, the Obama Administration has been
    using the EPA as the means to create an end that I, along with
    the majority of Americans, strongly oppose. This end results in
    a world where affordable, reliable, and American-based energy
    is no longer freely available. This end results in the loss of
    innovation and job opportunities at home and sends American-
    owned companies and their jobs overseas. This end results in
    increasing the cost of fuel, electricity, and other goods and
    services to the American public.
        For the past 2 years, the decisions of executive branch
    bureaucrats at the EPA have not been subject to congressional
    oversight and I am glad that this Committee is beginning to
    remedy that situation starting today. I hope this hearing is
    just the first in a series of hearings discussing legislation
    that addresses several of my concerns, including: the many
    flaws in the EPA's endangerment finding for greenhouse gases;
    the unjustifiable economic harm being passed on to the American
    public at little to no proven benefit, health or otherwise; and
    the inconsistencies in the EPA's approach and attack on
    individual states' air quality standards and permitting
    requirements.
        I would like to offer a special welcome to Texas Attorney
    General Greg Abbott. Attorney General Abbott, along with the
    Texas Commission on Environmental Quality and countless other
    private sector and state representatives, has been fighting a
    good fight and asking the EPA to explain and reconsider
    specific regulations regarding greenhouse gases and permitting
    issues and I look forward to hearing from Mr. Abbott and the
    other witnesses about their interactions and relationships with
    the EPA.
        I, like all Americans, want to breathe clean air and make
    sure that our children and future generations inherit the same
    beautiful country that we enjoy now. We already have laws on
    the books that protect our air and before Congress or federal
    agencies enact new laws we must examine the facts, the science,
    the needs of the American public, and the economic impact of
    new regulations.

        Mr. Whitfield. At this time I recognize the ranking member
    of the full Energy and Commerce Committee, the gentleman from
    California, Mr. Waxman.

    OPENING STATEMENT OF HON. HENRY A. WAXMAN, A REPRESENTATIVE IN
                 CONGRESS FROM THE STATE OF CALIFORNIA

        Mr. Waxman. Thank you very much, Mr. Chairman.
        Today we hold a hearing on legislation that would rollback
    the Clean Air Act and block the Environmental Protection Agency
    from regulating dangerous carbon emissions from power plants,
    oil refineries and other large polluters. The underlying
    premise of this bill is that climate change is a hoax. That is
    the view of the chief Senate sponsor of this bill and it is
    also the view of our former chairman of this committee, Mr.
    Barton, and that is the foundation of this bill. This
    legislation says carbon emissions do not endanger public health
    and welfare.
        Mr. Chairman, you and the new Republican majority have a
    lot of power to write the Nation's laws but you do not have the
    power to rewrite the laws of nature, and that is the
    fundamental problem with this proposal.
        In 2009, EPA found that carbon emissions endanger public
    health and the environment. That was a scientific conclusion
    that is supported by the National Academy of Sciences, the
    premier scientific organizations of all the world's major
    economies.
        This legislation would overturn EPA's endangerment finding.
        Now, this won't stop carbon pollution from building up in
    the atmosphere. It won't stop the droughts and floods that are
    spreading like an epidemic across the globe. It won't protect
    the air quality of our cities when summer temperatures soar to
    record levels, and it won't stop the strange weather patterns
    that have locked much of our Nation in a deep freeze this
    winter.
        What it will do, though, is gut the Clean Air Act and
    prevent EPA from addressing this enormous threat to public
    health and welfare.
        Protecting public health and preventing climate change
    should not be a partisan issue. In January 2008, Stephen
    Johnson, the former EPA Administrator under President Bush,
    sent a letter to President Bush. Administrator Johnson wrote,
    ``The latest science of climate change requires the Agency to
    propose a positive endangerment finding. It does not permit a
    credible finding that we need to wait for more research.'' And
    he said that the Bush Cabinet agreed with this position.
        The science hasn't changed in the last 2 years, in fact, it
    has only gotten stronger. Yet somehow belief in science has
    become another partisan battleground.
        This legislation is called the ``Energy Tax Prevention
    Act.'' This title is total nonsense because EPA has no
    authority to levy energy taxes.
        What this bill should be called is the ``Big Polluter
    Protection Act.'' The only beneficiaries of this legislation
    are the Nation's largest polluters. The biggest backer of this
    bill is Koch Industries, an oil company that spent millions of
    dollars to elect Republicans to Congress.
        Now, members can have different ideas about how to reduce
    carbon pollution. I believe the steps that EPA Administrator
    Lisa Jackson is proposing under the Clean Air Act are moderate
    and appropriate. They are also remarkably similar to the
    measures that former Administrator Johnson recommended to
    President Bush. But I understand that members could reasonably
    have different views. Indeed, I preferred the market-based
    approach recommended by utilities and manufacturers that was
    the basis for the House-passed clean energy legislation last
    Congress.
        But what doesn't make sense is the extreme approach in this
    bill. It will repeal the only authority the Administration has
    to protect our health and the environment without providing any
    alternative. That is another repeal but no alternative to
    replace it. Why replace it? The science is a hoax, we don't
    need to solve the problem, there is no problem. That is the
    underlying assumption. Well, that will only make the problem
    worse.
        History will not judge this committee kindly if we become
    the last bastion of the polluters and the science deniers. When
    carbon emissions rise to record levels and our weather system
    goes haywire, the American people will ask why we acted so
    irresponsibly. I hope we will be able to tell them that we
    stood up for science and public health and rejected this
    extreme proposal. I yield back my time.
        Mr. Whitfield. Thank you, Mr. Waxman.
        At this time we will introduce our first witness, who
    really needs no introduction. Senator James Inhofe from
    Oklahoma is the ranking member of the Senate Committee on
    Environment and Public Works. Of course, he served in the House
    of Representatives. He is recognized as a real expert in the
    field of energy as well as other areas. We are delighted to
    have him with us today, and I might say that he is floating a
    discussion draft over on the Senate side very similar to our
    legislation we have on the House side. So Senator Inhofe, we
    are delighted to have you with us today and we recognize you
    for an opening statement.

       STATEMENT OF JAMES INHOFE, U.S. SENATOR, STATE OF OKLAHOMA

        Mr. Inhofe. First of all, let me thank you for the
    invitation to be here. It is a joy. The only disappointment I
    have is that I am not sitting at the same table with
    Administrator Jackson. I know it surprises and disappoints a
    lot of people that she and I are really very good friends. I
    find her--a lot of liberals aren't this way but in her case,
    she responds to a question, she gives you an honest answer, and
    I have always appreciated that.
        Much to the chagrin of my staff, I am not going to use my
    opening statement that they prepared, but so that they won't be
    completely overlooked, I would like to ask that it be made a
    part of the record, and I will go ahead and ramble just for a
    few minutes.
        Let me share a couple of thoughts that I have with you.
    First of all, this issue is a new issue to the House,
    relatively new. We have been dealing with it since Kyoto, since
    the middle 1990s, and I was in the middle of it back then and
    you are right, you quoted the statement that was made by some
    95 to nothing in the Senate. Now, that statement to refresh
    memories here, was that we are not going to ratify anything
    that doesn't treat developing nations like developed nations or
    that is devastating to our economy. However, most of the
    Senators at that time were believers, and I use the word ``the
    alarmists.'' I think most of them would fit that.
        And so we--and I have to admit, you know, confession is
    good for the soul. When I was the chairman of the subcommittee,
    I believe the Clean Air Subcommittee of EPW, I thought too that
    catastrophic global warming was caused by anthropogenic gases
    because everybody said it was, and it wasn't until the Wharton
    School came out with, I think it was called the Wharton
    Econometric Survey, the question was this: should we ratify the
    Kyoto treaty, what would it cost the people of America, and the
    result was a range. That range was between $300 billion and
    $400 billion a year. Then I happened to think, you know, when
    you got up in the billions and trillions, it is kind of hard.
    You have to bring this back home. I remembered how outrageous
    it was when the Clinton-Gore tax increase of 1993 came through,
    and that was a $30 billion tax increase. I thought wait a
    minute, this is 10 times greater than that. So I thought at
    that time, let us at least look and be sure that the science is
    there, and I remember at that time there was a scientist by the
    name of Tom Wigley. Tom Wigley was commissioned, I believe, by
    then-Vice President Al Gore to answer the question that if all
    nations, all developed nations were to get together and agree
    to the Kyoto treaty and live by their emission standards, how
    much would that reduce the temperature in 50 years. The answer
    was something like seven one-hundredths of 1 degree Celsius.
    Well, of course, that was something that wasn't even
    measurable.
        So when we started questioning the science, all of a sudden
    the scientists came out of the woodwork and they were coming in
    and giving testimonials about how they, the IPCC, would not
    consider any views that anyone had unless they themselves were
    an alarmist. Well, we started talking about that and then
    obviously we did not ratify. By the way, it is important to
    note that the ones who were really pushing the Kyoto treaty,
    that would have been the Clinton-Gore Administration, they
    never submitted to the Senate for ratification. So it is not
    our fault that we never had that before us but they wisely did
    not do it.
        Then we started coming up with the bills. We had McCain-
    Lieberman of 2003, McCain-Lieberman of 2005, the Waxman-Markey
    bill, the Lieberman-Warner bill, the Sanders-Boxer bill. Now,
    they were all very similar. Cap and trade is cap and trade.
    Now, you could argue, well, wait a minute--and I am sure
    Congressman Waxman would disagree with this--but all these
    bills along with the Kyoto treaty would cost in that range of
    somewhere between $300 billion and $400 billion a year. It is
    not just Wharton. MIT, Penn State and others have come in and
    talked about that.
        I am going to mention too, I want to end my opening
    statement with two quotes or responses to questions by Lisa
    Jackson that I have a great deal of respect for. Well, we have
    made a decision some time ago as we were trying to defeat and
    successfully did defeat all the bills that I mentioned on the
    Floor of the Senate, and one of the things I did since at best
    the science is mixed, there is nothing conclusive in the
    science, but it is mixed, let us go ahead--and I did this, it
    might have been when we were debating the Waxman-Markey bill or
    it might have been the Sanders-Boxer bill, I can't remember
    which one, but I said even though I don't agree the science is
    there, let us stipulate to it so we can talk about the
    economics, and so we did, and then is when we started talking
    about the cost of this thing.
        I think that maybe in response to questions I can be more
    specific but this bill that I will be the sponsor in the
    Senate, it will be the same wording, I say to Chairman
    Whitfield, that is just one of the problems we are having right
    now with the overregulation of the Environmental Protection
    Agency. We have such things as the boiler and utility MACT--
    that is the maximum achievable control technology--ozone, the
    PM 10 dust, hydraulic fracturing, all these things to put
    American jobs either overseas or just kill them and destroy our
    economy. These things are happening right now. This is one part
    of it but a very important part of it.
        Now, what I am going to say within my time frame here and
    make two observations, and this came from Administrator
    Jackson. In one of our committee hearings, and I will tell you
    when it was, it was in December, a year ago December, right
    before, the day before I was going to go to Copenhagen. I was
    the one-man truth squad in Copenhagen, I might add, and before
    I left I said in a hearing, Mr. Chairman, I said, Madam
    Administrator, I understand and I believe that once I leave
    town you are going to have an endangerment finding, and she did
    not deny that and she kind of nodded and with her very pleasant
    smile like she always has, and I said when you do this, it has
    got to be based on some kind of science, what science would you
    base this on, and she said well, primarily it is the IPCC. That
    is the United Nations. Well, that was right in the middle of
    the time that they had been totally debunked. Now, they try to
    say that Climategate wasn't a real thing. It was. They tried to
    play it down. Let me just real quickly, so it is in the record,
    talk about it. Atlantic magazine said the close-mindedness of
    these supposed men of science, their willingness to go to any
    length to defend a preconceived message is surprising even to
    me. The stink of intellectual corruption is overpowering. The
    statement in the Daily Telegraph, this is the largest one in
    London, the scandal could well be the greatest scandal in
    modern science. So we have all of the facts that this is the
    science on which this is based, and I am hoping that people are
    going to keep this in the dialog, let people know how phony
    this was.
        The other thing was, and I am speaking now to the many
    people out not just in my State of Oklahoma but throughout
    America who think I am wrong on this issue, people who really
    believe, people who think that the alarmists are right, that in
    fact that anthropogenic gases are causing catastrophic global
    warming. To them I say this: If they are right, what difference
    does this really make? Because when I asked the question to
    Administrator Jackson, I said if we were to pass this bill, I
    don't know, I say to my good friend, Mr. Waxman, whether it was
    the Waxman-Markey or which bill it was, but I said if we pass
    this, will this have a reduction, result in reducing greenhouse
    gases. Her answer was no, because this only applies to the
    United States.
        I will carry it one step further. If we cause our jobs to
    go overseas as a result of having something like this, those
    jobs are going to go places like China and India and Mexico
    where they don't have any restrictions at all, and so those
    people who say well, we have to set the example in America,
    that China is anxious to follow our great example. I say they
    are laughing at us right now. They are not going to do it. They
    are waiting for those jobs to come over.
        So with that, I would only say that I hope we will get a
    chance to realize that even if this ends up, those people out
    here that really believe this, what we take, the action we take
    whether it is through regulation or whether it is through
    legislation here in the United States is not going to reduce
    the greenhouse gas emissions. Thank you, Mr. Chairman.
        [The prepared statement of Mr. Inhofe follows:]

                          Testimony of James M. Inhofe

        Thank you, Chairman Upton, Chairman Whitfield, and Ranking
    Member Rush for the opportunity to speak to the subcommittee
    this morning. It is an honor to provide testimony to the
    subcommittee on the Energy Tax Prevention Act of 2011.
        The draft bill, sponsored by me, Rep. Upton, and Rep.
    Whitfield, would repeal EPA's authority to regulate greenhouse
    gases under the Clean Air Act. We're doing this for one simple
    reason: EPA's regulations will impose enormous costs for no
    meaningful benefits-in other words, all pain for no climate
    gain.
        I have great respect for Administrator Jackson-she is doing
    what she thinks is right. But I think EPA is taking the wrong
    course. Let me explain.
        Congress didn't allow EPA to regulate greenhouse gases
    under the Clean Air Act. Administrator Jackson even agreed with
    the statement two years ago that the Clean Air Act ``is not
    specifically designed to address greenhouse gases''.
        We also know that EPA's own analysis shows its actions
    won't affect climate change, and the scientific basis of its
    endangerment finding, which the Administrator confirmed to me
    is the UN's Intergovernmental Panel on Climate Change, or IPCC,
    is flawed.
        Now I'm not here to debate science. So let's assume-as I
    did during the Lieberman-Warner debate in the Senate-that
    predictions of more droughts, more floods, more intense storms,
    and more cases of disease are true. What we know is that EPA's
    regulations won't affect any of this.
        EPA's analysis of the Lieberman-Warner bill shows that,
    without aggressive action by China and India, cap-and-trade
    won't reduce greenhouse gases by any meaningful amount. The EPA
    also found that its regulations covering CO2 from cars would
    reduce global temperatures by 0.006 degrees Celsius by 2100. In
    other words: no effect.
        Now what if we added actions by other countries? Dr. Tom
    Wigley of the National Center for Atmospheric Research found
    that full implementation of Kyoto, including action by the
    U.S., Europe, Canada, Russia, and others, would reduce global
    temperature by, at most, 0.21 degrees Celsius by 2100. In other
    words, the Earth would warm about 6 percent less than it
    normally would.
        We know from Wharton, MIT, and others that Kyoto would cost
    about $300 to $400 billion annually through higher gas, food,
    and electricity prices. In fact, that's about the cost of all
    the cap-and-trade bills we've seen since 2003. EPA's
    regulations will be no different.
        The point is this: it is unfair and unacceptable to ask the
    steel worker in Ohio, the chemical plant worker in Michigan,
    and the coal miner in West Virginia to sacrifice their jobs so
    we can reduce temperature by a barely detectable amount in 100
    years.
        Yet this is exactly what the EPA is doing. The Energy Tax
    Prevention Act would stop EPA and protect those jobs. It would
    ensure that America's manufacturers can stay here and compete
    against China. And it would put Congress back in charge of
    deciding the nation's climate change policy.
        EPA's actions under the Clean Air Act are part of the cap-
    and-trade agenda. That agenda wants higher energy prices for
    consumers, higher taxes for citizens, more regulations on small
    businesses, more restrictions on choices, and ultimately less
    freedom. Supporters believe these things will stop global
    warming. They won't.
        EPA claims the Supreme Court forced it to act. Not so; the
    Supreme Court ruled that EPA possessed the discretion under the
    Clean Air Act to decide whether greenhouse gases endanger
    public health and welfare. EPA was given a choice, and it made
    the wrong choice. The Energy Tax Prevention Act is the right
    choice for jobs, for consumers, for a growing economy, and for
    the future of America.

        Mr. Whitfield. Thank you, Senator Inhofe. We appreciate
    your testimony.
        Mr. Waxman in his opening statement referred to this letter
    by former EPA Administrator Steve Johnson to President Bush
    about the endangerment finding, and I don't know all the
    details about it so I am going to ask you about it, but it was
    my understanding that once they really got into the process of
    looking at that, a number of federal agencies came out very
    much opposed to an endangerment finding including Ag, Commerce,
    Transportation and Energy. Do you have any recollection of the
    letter that Mr. Waxman was referring to?
        Mr. Inhofe. I do, because first of all, I have a great deal
    of respect for Steve Johnson and I supported his being put in
    the position he was in. I would only say this. Those who want
    to quote him as was quoted in the opening statement here in
    this meeting need to talk about what he said since then. I want
    to quote him now. He said, ``One point is clear. The potential
    regulation of greenhouse gases under any portion of the Clean
    Air Act could result in an unprecedented expansion of EPA
    authority that would have a profound effect on virtually every
    sector of the economy and touch every household in the land.''
    He went on to say, ``I believe the ANPR demonstrates the Clean
    Air Act, an outdated law originally enacted to control regional
    pollutants that caused direct health effects, is ill-suited for
    the task of regulating global greenhouse gases.''
        Mr. Whitfield. Thanks.
        Mr. Inhofe. And this by way, you mentioned the Departments
    of Energy, Transportation, Commerce, Agriculture and probably
    some others have made this statement.
        Mr. Whitfield. I was looking at the EPA Web site actually
    last night, and there was a comment on there right at the very
    main page. It said ``We are working across the nation to usher
    in a green economy.'' Now, we all recognize, as I said in my
    opening statement, to meet our energy demands, we are going to
    have to have renewables, we are going to have to have
    everything, but this Administration seems to be so focused on
    pushing a green economy, and I know that President Obama in his
    State of the Union address talked about this green economy is
    going to stimulate the economy and create the jobs. And I know
    from the research that I have done personally, one of the
    countries that has been a leader in green energy has been
    Spain, and I read an article just a couple of days ago that
    they have the highest unemployment rate in the industrialized
    world, approaching 20 percent. Do you have the same concerns
    about this all-out push for green energy and the impact that
    that could have on our employment levels in America?
        Mr. Inhofe. Chairman Whitfield, it goes even further than
    that. One of the--I would have to, for the record, give you the
    name of which one of the Administration said this, I think it
    might have been the Under Secretary of Treasury, made the
    statement that we are going to have to do, they say take away
    the perks that are out there for the energy industry so that we
    can force people to concentrate on green energy. I think
    everyone here, I think every Republican and Democrat or the
    Republicans, anyway, they want all of the above. We want gas,
    oil, coal, nuclear, renewables, green, we want it all, but what
    is available now to run this machine called America? We have
    oil and gas.
        This is new information. As of just a year ago, we in the
    United States have the greatest, largest number of recoverable
    reserves in coal, oil and gas of any country in the world. We
    are not number 2, we are number 1. Now, if you look at the
    shale opportunities that are out there and the fact that these
    are close formations, we have enough natural gas to take care
    of this country for 110 years. Now, yes, during that time
    perhaps technology will be here, we will have all kinds of
    green opportunities. That is great. I am all for it. But until
    then, you have got to run this country.
        The thing that bothers me over in the Senate, I hear from
    my good friends John Kerry, Barbara Boxer, they all talk about
    our dependence on foreign countries, for our oil, our energy,
    as if, you know, we shut down fossil fuels and somehow not be
    as dependent upon them. Just the opposite. You know, we have to
    run this machine called America and we can't do it now without
    fossil fuels. If we could release all the political pressures
    that are on our resources out there, we wouldn't have to be
    dependent upon any foreign country or the Middle East for one
    barrel of oil. I forgot what your question is but that is the
    answer.
        Mr. Whitfield. Thank you. I thought it was a good answer.
        I recognize Mr. Rush for 5 minutes.
        Mr. Rush. I thought it was a good question but I didn't
    think it was a good answer.
        Senator, I have the utmost respect for you. I want to thank
    you for taking the time out to come to this hearing. As you
    know, there are some vociferous and very disagreement with some
    of your conclusions, especially as it relates to job creation
    and also electric reliability. Administrator Jackson, she has
    pointed out in her White Paper that she released earlier that
    the environmental, technology and services sectors generated
    under the Clean Air Act an estimated $300 billion in revenue--
    that is $300 billion in revenue--and supported nearly 1.7
    million jobs, and I think those are real jobs. That is
    certainly not chump change. Do you have any comments or any
    reaction to her conclusion?
        Mr. Inhofe. Yes, I do, Congressman. First of all, I have a
    Web site , Inhofe.Senate.gov, and if you go there you will
    find, I have talked about the money and the jobs that all these
    overregulations would cause. Now, you are addressing only the
    greenhouse gas, what is happening with the regulations that are
    subject of this committee. But I had mentioned in my opening
    statement, there is also all the MACT laws, the utility MACT,
    the boiler MACT, trying to stop hydraulic fracturing, the
    ozone, all of these issues that are there, the PM10 dust, if
    you add those up, each one has a price tag in terms of dollars
    and the amount of the jobs that would be lost. Those jobs, that
    information comes from most of the labor unions in the United
    States along with, I might add, the National Black Chamber of
    Commerce, who will be testifying, I don't know whether he is on
    today, but he is great. He has testified before our committee.
    And I want you to ask him that question because I think it is
    very specific. The jobs that would be lost, the costs that
    would be there are something that we can't sustain in this
    country.
        Mr. Rush. Thank you, Senator. Senator, let me ask you, as I
    think you are the ranking member on, which committee now?
        Mr. Inhofe. Environment and Public Works.
        Mr. Rush. I wanted to make sure I got it right. And as
    ranking member and during the course of that committee's
    hearings, I am sure you had a number of different hearings on
    this particular subject. Is that correct?
        Mr. Inhofe. We have had hearings.
        Mr. Rush. Has your committee conducted hearings with no
    scientists among the witnesses? Have scientists been included
    in your hearings?
        Mr. Inhofe. Yes, we have scientists there on both sides, as
    you well know, because you are going through this now. When you
    are a minority, you don't get as many witnesses.
        Mr. Rush. But do you find it strange that this hearing is
    being conducted with no scientists at all?
        Mr. Inhofe. We had scientists in our hearing. I would just
    use one, Richard Linzen, for example, from MIT is recognized as
    one of the very top individuals. He testified and----
        Mr. Rush. Senator, which I do understand, but do you find
    that it is strange that at this hearing of this importance that
    we have no scientists on the witness list at all for this
    hearing? Do you find that strange?
        Mr. Inhofe. I don't know. You would have to ask the
    chairman that question. I do know that the Rules of the House
    and the rules of the Senate do provide for minority witnesses
    and so I don't know how this was constructed.
        Mr. Rush. All right. And lastly, Senator, Chairman Waxman
    and I on February 7th sent a letter to the chairman and asked
    him that the Republicans and the Democrats work together to
    write bipartisan legislation to establish a clean energy
    standard. Do you support similar activity in the Senate?
        Mr. Inhofe. Well, yes. We have been trying to do that for a
    long period of time. Unfortunately, CO2 has held
    hostage all kinds of opportunities. We had the Clear Skies
    bill. That would have been SOx, NOx,
    mercury. We could have passed the most restrictive bill in
    terms of emissions, of pollutants but it was held hostage
    because we don't care about all that, we want to make sure that
    CO2 is there. So I do support programs that affect
    kinds of emissions and I strongly support it. I would say this,
    that we are going to go through the process, and I am hopeful
    that I can get my bill passed in the Senate and this bill
    passed here and we will see what happens. It could be we would
    have to override a veto. I don't know. But we may end up--
    things are going to change in a couple years so we will have to
    wait and see.
        Mr. Rush. Thank you. I yield back the balance of my time.
        Mr. Whitfield. Thank you, Mr. Rush.
        At this time I recognize Mr. Upton.
        Mr. Upton. Thank you, Mr. Chairman, and again Senator, I
    appreciate you being here, especially on a day that the Senate
    doesn't have votes and I know you are trying to get back to
    snow-laden Oklahoma where they have, I am told, cross-country
    skiing. I am not sure you have got any hills for downhill but
    you have got a good 10 inches last night, and people at least
    can go straight forward.
        Two questions that I want to ask. One is, I mentioned in my
    opening statement, and I wanted you just to comment on, as
    regards to some groups that are offering criticism toward this
    discussion draft. In your view, does it in any way undermine
    the Clean Air Act?
        Mr. Inhofe. No, it is not going to weaken the regulation of
    air pollution that, you know, people are concerned about,
    asthma and heart attacks and all these long list of things,
    lung cancer. The Clean Air Act has reduced air pollution and
    has done so in conjunction with a period of economic growth.
    That is significant because during that period of time all
    these things have actually reduced, and I can't see that this
    would have any effect on that. I did mention that things like
    the Diesel Regulation Act, Clear Skies, these are things that
    we have been trying to do and have done successfully, so we are
    addressing that and have been addressing that with such
    legislation as I just mentioned.
        Mr. Upton. Now, I know that you are writing a book, and----
        Mr. Inhofe. Guess what the name of it is?
        Mr. Upton. Well, you can tell me in a second. I just want
    to know if you are going to talk in your book or you are
    planning to write in your book whether EPA has calculated the
    further reduction in temperature from the tailpipe rule at
    about one-hundredth of a degree Fahrenheit by the year 2100.
        Mr. Inhofe. I think what you are getting to here confirms
    what I said in my opening statement about the Tom Wigley report
    on the Kyoto treaty, that it is hardly detectable. I will tell
    you about my book. I did finish it last week on the 5th,
    although now I see we are going to have to go forward with it a
    little bit further. I won't tell you what it is about but the
    name of the book is The Hoax. Yes, there have been a lot of
    things that--Don Rumsfeld is not the only one writing a book.
        Mr. Upton. Thank you. I yield back, Mr. Chairman.
        Mr. Whitfield. Thank you. At this time I recognize the
    gentleman from California, Mr. Waxman.
        Mr. Inhofe. And he will be the first to receive an
    autographed copy.
        Mr. Waxman. I will be greatly honored. I receive a lot of
    books. In fact, I just got one that pointed out that Jack
    Abramoff was railroaded into prison by the establishment, so I
    am looking forward to reading both books.
        Senator Inhofe, it is my understanding you have said, and I
    think you said it very clearly a minute ago, that this climate
    change idea is just a hoax being perpetrated on the American
    people. Is that right?
        Mr. Inhofe. That is right.
        Mr. Waxman. I am a lawyer, and I don't have a scientific
    background. I understand your degree was in economics and you
    ran small businesses before you were elected to public office.
    Like me, you are not a scientist by training. Isn't that right?
        Mr. Inhofe. That's correct.
        Mr. Waxman. Now, I want to read you a quote from our
    Nation's premier scientific organization, the National Academy
    of Sciences. According to the National Academy of Sciences,
    ``Climate change is occurring, is caused largely by human
    activities, and poses significant risks for and in many cases
    is already affecting a broad range of human and natural
    systems.'' Senator, you disagree with the National Academy of
    Sciences. Is that right?
        Mr. Inhofe. Well, I disagree with that particular
    interpretation. I would add that there are several members,
    former members of the National Academy of Sciences, who are not
    there anymore because they disagreed----
        Mr. Waxman. Well, that is their conclusion and you disagree
    with it.
        Mr. Inhofe. And----
        Mr. Waxman. No, Senator, it is my turn now. You are in the
    House and this is a 5-minute round so you know how that goes.
        Mr. Inhofe. Yes, sir. It hasn't been that long.
        Mr. Waxman. Now, you disagree with that and the National
    Academy of Sciences. The National Academy of Sciences is our
    Nation's premier scientific institution. I don't know why they
    would want to mislead the American people. But they are not
    alone. The American Association for the Advancement of Science,
    the American Geophysical Union, the American Meteorological
    Society along with 15 other leading scientific organizations
    have concluded, and I want to quote, ``If we are to avoid the
    most severe impacts of climate change, emissions of greenhouse
    gases must be dramatically reduced.'' Thirteen federal
    departments and agencies including NASA, the National Science
    Foundation, the Department of Defense have reported that global
    warming is ``unequivocal and primarily human induced.'' And the
    leading scientific organizations in England, France, Germany,
    Russia, Japan, China, Brazil and India have all reached the
    same conclusion.
        Now, Chairman Upton and you have gone to the point where
    you say that this is not something we need to deal with. I
    think Mr. Upton says it is a problem that is occurring but he
    doesn't accept it as human emissions that are causing climate
    change. Well, Mr. Rush raised this point. I think it would be
    important and I would request that we hold hearings on this
    fundamental issue of science before we vote on this
    legislation. The premise of the Inhofe-Upton legislation is
    that carbon emissions don't endanger public health. Before we
    proceed, we should call the best scientists in the Nation
    before the committee so we can understand whether Senator
    Inhofe's views or Chairman Upton's are supported by the
    science. But it seems to me what you are saying is, even if
    climate change is real, we can't do anything about it so we
    shouldn't even try, and if that is the situation, I find that
    quite amazing.
        Now, the reason this is under the Clean Air Act is because
    the Supreme Court by 5-4 said EPA must regulate if they have an
    endangerment finding. The Supreme Court by 5-4. There are a lot
    of Supreme Court decisions that went 5-4 that I didn't like but
    this is one where the Court said that this is part of the Clean
    Air Act.
        I think that there is a fundamental flaw in one of the
    arguments that I have been hearing. When you calculate the
    benefits of action, there is an assumption that the United
    States and other nations will take only minimal steps to
    control emissions, but when you calculate the cost, there is an
    assumption, there is a completely different scenario that the
    United States will implement draconian control measures. I
    don't think that is fair. A fair analysis will show that the
    modest measures that EPA is currently proposing will have
    little impact on the economy. In fact, EPA's analysis shows our
    economy grows because we become more energy efficient. In other
    words, we are making a small step forward on climate change at
    virtually no cost to the economy. A fair analysis will show
    that if we adopt more far-reaching measures, we could have a
    major impact on climate change at a manageable cost.
        Last year the House passed the Waxman-Markey bill, passed
    out of this committee as well. That would have reduced U.S.
    emissions by 80 percent by 2050. Modeling of that bill proved
    that we could dramatically reduce pollution for only a postage
    stamp per day while cutting the deficit. Well, I think if we do
    nothing, and this bill is a repeal and no replacement. No
    replacement for dealing with this problem. If it is a real
    problem, let us acknowledge it and figure out a way to deal
    with it and resolve our differences on how to approach a
    constructive resolution. But if it is not a problem, then I
    think what we are doing is saying that we can't do anything
    about the droughts, the floods, the storms, the public health
    and economic misery climate change will cause, so we simply
    should give up trying, and I don't think that is the American
    way. Yield back my time.
        Mr. Inhofe. Mr. Chairman, I know his time has expired but
    he asked me three questions and I can answer them real quick.
        Mr. Whitfield. OK.
        Mr. Inhofe. First of all, I knew you were going to end up
    with the droughts and the floods and all that. It is the fear
    that has been driving this for so long. Let me just answer the
    three questions.
        First of all, the fact that if we were--the reason in my
    opening statement----
        Mr. Waxman. What are the three questions you seek to
    answer?
        Mr. Inhofe. Well, I am answering them right now. One was
    about the reductions. The fact is----
        Mr. Waxman. I asked you whether you disagree with the
    National Academy of Sciences. I asked you very specific
    questions.
        Mr. Barton. Mr. Chairman, we should let our witness make a
    statement. Mr. Waxman talked for 4 minutes----
        Mr. Waxman. Mr. Chairman----
        Mr. Barton. He basically gave an opening statement.
        Mr. Waxman [continuing]. The time now goes to whoever on
    your side is next, and they can yield their time for that
    purpose. But I will go along with whatever the----
        Mr. Barton. We always let the witness answer a question----
        Mr. Waxman. Well, I didn't have a question pending.
        Mr. Inhofe. Yes, you did.
        Mr. Waxman. If the gentleman wants to respond to my
    statements, then that is up to the Chair whether that comes out
    of my time.
        Mr. Whitfield. I will tell you what let us do, Senator
    Inhofe. I am going to go to Mr. Barton and he can ask
    questions. We have a lot of other people, and I am sure that--
    --
        Mr. Inhofe. That is fine.
        Mr. Whitfield [continuing]. We will get to the issues. Mr.
    Barton, I recognize you for 5 minutes.
        Mr. Barton. Thank you, Chairman. We do give our witnesses
    the courtesy at the end of their--when somebody gives a
    soliloquy or monolog like Chairman Waxman did to at least make
    a comment on it.
        Senator, you have participated in dozens of hearing on this
    issue in the other body, some as chairman and some as ranking
    member. Is that not correct?
        Mr. Inhofe. That is correct.
        Mr. Barton. And you would consider yourself at least in
    that body to be knowledgeable on this issue?
        Mr. Inhofe. Not scientifically, as pointed out by Mr.
    Waxman, but yes.
        Mr. Barton. You mentioned in your opening statement
    millions of jobs and hundreds of billions per year and studies
    that have been done by independent groups. I think the U.S.
    Chamber has done a study, Heritage has done a study. You
    mentioned MIT. Have any of those studies been refuted by the
    EPA or any other executive branch authority in the Obama
    Administration?
        Mr. Inhofe. No, they haven't. The interesting thing is that
    there is a consistency here. It doesn't matter whether you are
    talking about the Kyoto treaty or any of the other issues or
    bills that we considered including the Waxman-Markey bill, the
    amount is always in that range, $300 billion to $400 billion,
    and that is pretty consistent.
        Mr. Barton. So there has been no refutation of those type
    order of magnitude numbers?
        Mr. Inhofe. I can remember when we have had witnesses from
    the EPA who have agreed with that. Some will not, of course.
        Mr. Barton. And obviously if cap and trade had been
    implemented like Mr. Markey and Mr. Waxman wanted, or if these
    pending greenhouse gas regulations are implemented, we could
    expect that type of an impact and that would certainly be a
    tax, if not explicitly, implicitly, on the U.S. economy. Would
    you agree with that?
        Mr. Inhofe. I would say precisely the same difference in
    what they are attempting to do with regulations and what they
    are attempting to do with legislation so I think it would be
    the same, yes, sir.
        Mr. Barton. Now, you indicated that you have got a draft
    bill that is either identical or very similar to Chairman
    Whitfield and Chairman Upton's bill. Is that correct?
        Mr. Inhofe. That is correct.
        Mr. Barton. Does your legislation or this pending
    legislation that is in draft form, does it change the standard
    on ozone under the Clean Air Act?
        Mr. Inhofe. No.
        Mr. Barton. Does it change the standard on particulate
    matter?
        Mr. Inhofe. No, it doesn't.
        Mr. Barton. Does it change the standard on carbon monoxide?
        Mr. Inhofe. No.
        Mr. Barton. Does it change the standard on nitric oxide?
        Mr. Inhofe. No.
        Mr. Barton. Does it change the standard on sulfur dioxide?
        Mr. Inhofe. No.
        Mr. Barton. Does it change the standard on lead?
        Mr. Inhofe. No.
        Mr. Barton. Those are the six criteria pollutants that are
    regulated under the Clean Air Act. Is that not correct?
        Mr. Inhofe. That is correct.
        Mr. Barton. So if you don't change any of those standards,
    to paraphrase former Chairman Waxman, you are certainly not
    gutting the Clean Air Act, are you?
        Mr. Inhofe. No, sir.
        Mr. Barton. What you are doing, though, Senator, is saying
    that the Clean Air Act and its amendments were never intended
    to regulate CO2 as a pollutant. Is that not correct?
        Mr. Inhofe. Which is also what Mr. Johnson said, yes, sir.
        Mr. Barton. And I think this is a true statement. I was on
    this committee when was passed the Clean Air Act Amendments of
    1990. I was a cosponsor. I participated in the debate. Chairman
    Dingell was the full committee chairman and was very fair in
    allowing what was then the Minority that I was a member of to
    be a full participant in those debates. I don't remember that
    we put CO2 in any way in the Clean Air Act
    Amendments. Is that your recollection?
        Mr. Inhofe. That is correct.
        Mr. Barton. Are you familiar with the comments of a
    scientist or at least a senior staffer at the EPA who has since
    retired named Mr. Alan Carlin?
        Mr. Inhofe. Yes, I am.
        Mr. Barton. And are you cognizant of the report that he
    attempted to publish that was suppressed for some time by the
    EPA that basically said the endangerment finding put forward by
    the Obama Administration was totally incorrect? Now, I am
    paraphrasing when I say totally incorrect but he pointed out
    seven or eight basic flaws that says the hypothesis is not
    supportable.
        Mr. Inhofe. It was a career ender, yes.
        Mr. Barton. He has since retired?
        Mr. Inhofe. Yes.
        Mr. Barton. I am going to submit that statement, this
    report for the record, Mr. Chairman.
        Mr. Whitfield. Without objection.
        [The information appears at the conclusion of the hearing.]
        Mr. Barton. It is about 50 pages, so I don't know what the
    rules are on that lengthy of a statement being put in the
    record, but I would hope the Minority would allow us to.
        And with that, I again thank Senator Inhofe and we look
    forward to working with you, and I yield back, Mr. Chairman.
        Mr. Whitfield. Thank you.
        I am going to call on the chairman emeritus, Mr. Dingell,
    for questions, but before, Mr. Dingell, you ask your questions,
    Senator, it is my understanding that you are going to have to
    leave relatively soon.
        Mr. Inhofe. Well, we are having a problem now. I am trying
    to get back to Tulsa but there is a record snow and maybe they
    are canceling the flights, but yes, I do have to try.
        Mr. Whitfield. OK. Well, then Mr. Dingell, I am going to
    allow you----
        Mr. Dingell. Mr. Chairman, I thank you for your courtesy.
    This will comfort you and I am sure Senator Inhofe. I have no
    questions. I wanted to welcome the senator.
        Mr. Inhofe. Could I use some of your time to answer the
    question from Mr. Waxman?
        Mr. Dingell. Well, all I really wanted to do, Senator, is
    welcome you back.
        Mr. Inhofe. Thank you very much, sir.
        Mr. Dingell. Good to see you again.
        Mr. Inslee. Mr. Dingell, would you mind yielding your time?
        Mr. Dingell. I am sorry?
        Mr. Inslee. Would you mind yielding your time to a fellow
    over here?
        Mr. Dingell. No, I really don't want to.
        [The prepared statement of Mr. Dingell follows:]
        [GRAPHIC] [TIFF OMITTED] T5734.096

        Mr. Inslee. Thank you very much.
        Senator Inhofe, welcome to the committee. You were right on
    one thing. You were right on one thing. The alarmists should
    not be listened to because the alarmists are those pessimists
    who figure out that Americans aren't smart enough to innovate
    our way out of this pickle, and we are in a pickle. And
    Senator, thank you for telling about your book. I am going to
    suggest a book you might want to look at. It is called Apollo's
    Fire, a book I coauthored, and it tells you how we are going to
    grow our economy, an economy that the evidence shows we can
    grow.
        Now, the Americans are against this ``Dirty Air Act,'' and
    that is what it is, and I will explain why in a minute. They
    are against this Dirty Air Act three to one, and the reason is,
    they know that the Clean Air Act reduced pollution 60 percent
    over the last 40 years while we grew our economy 207 percent.
        Mr. Inhofe. I agree.
        Mr. Inslee. Americans get it that we can innovate our way
    out of this pickle. Now, this is why this is the Dirty Air Act.
    I hear my friends saying we don't have anything against the
    Clean Air Act, we are not gutting the Clean Air Act. It is like
    saying they are not against the Antiterrorism Act, all we are
    doing is passing a bill saying the FBI can't enforce it. Now,
    when you gut the EPA's ability to enforce the law, you turn the
    Environmental Protection Agency into the environmentally
    pathetic agency, and that is not what Americans want. They want
    something rather than dirty air, and this Dirty Air Act hurts
    kids with asthma, it hurts seniors with respiratory problems
    and it hurts our economy.
        Now, I want to suggest to you there is a fundamental
    problem here. That problem is that we are not listening to the
    scientists, and I am going to ask you a question when I am done
    here in a minute and I hope I give time you to answer. But the
    scientists are telling us that we have got a real health
    problems on our hands. We got a letter from 1,800
    scientifically trained medical professionals yesterday. It says
    communities across the nation will suffer, not maybe, will
    suffer from poor--excuse me--still suffer from poor air
    quality. Low-income families face the impacts of toxic air
    pollution every day from smog causing asthma attacks to toxic
    mercury harming children's neurological development. Far too
    many people face a constant threat from the air they breathe
    and the impacts of climate change. Now, that letter is signed
    by, among others, doctors, Dr. Guillermo Arnaud of Tahlequah,
    Oklahoma, Dr. Therese Kwan of Kingston, Oklahoma, Dr. Warren
    Teal of Carney, Oklahoma. Doctors across this country and
    scientists across this planet know that our health is adversely
    affected by these chemicals, and by the way, carbon dioxide is
    in the Clean Air Act. It is in section 103, if you folks want
    to look at it. Carbon dioxide is in the Clean Air Act. And yet
    you are trying to take away the ability of Uncle Sam to protect
    our kids from asthma, and I have got a problem with that, and I
    am going to ask you this question because I think it is
    fundamental to this disagreement. I respect your opinion and
    right to have an opinion. But the National Science Foundation,
    these doctors, the IPCC, depending on science from the U.S.
    Navy, from Nobel Prize winners, none of whom are going to be
    called by this committee, by the way, and I think it is too bad
    we don't have real scientists up here, all of these people say
    that these things are bad for our kids' health, and yet this
    committee, their first witness calls somebody, rather than
    listening to Nobel Prize winners, thinks somehow that he is
    smarter than the 2,500 scientists that are telling us this is a
    problem.
        Now, I want to ask you this question. You have got, I
    think, grandkids, and I trust that if your grandkids were
    having a health problem, if they couldn't breathe, if asthma is
    affecting them, that you wouldn't take them to a lobbyist for
    the fossil fuel industry, you would take them to a
    pediatrician. You would take them to a scientist. So the
    question I ask you is, shouldn't we listen to the scientists
    here rather than the politicians and shouldn't we trust people
    of science that have an overwhelming conclusion about this
    issue? And I will yield to you for an answer.
        Mr. Inhofe. Thank you very much. And that is essentially
    the same question asked, so I will respond to it. Yes, in the
    very beginning when people were listening just to the IPCC, as
    I said in my opening statement, that has been pretty much
    debunked now. I don't know how anyone with a straight face is
    going to say that that should be the leading science. When you
    mention scientists, yes, many of them are saying this. If you
    go to my Web site , I have given five speeches on this science,
    very long ones, I might add. We started out with some 50
    scientists, went up to 100 and up to several hundred. And so
    there are many scientists that have varying views. That is why
    I say, the science on this issue is mixed. The economics are
    not mixed.
        The last thing I want to mention, because somehow it has
    got to be in this record, and this is responding to Mr. Waxman,
    the Court did not mandate that the EPA regulate CO2,
    and this is words of the Court. The EPA can avoid promulgating
    regulations if it determines that greenhouse gases do not
    contribute to climate change or if it provides some reasonable
    explanation as to why it cannot. Well, what they are saying is,
    they have three choices: either regulate it, don't regulate it
    or do nothing, and that was not a mandate from the Court, and I
    believe that has to be in here at some point.
        Mr. Whitfield. I might say that we did invite a scientist
    to testify. Mr. Chu was invited, and he declined our offer.
        Now, Senator Inhofe, do you have to go now or can you take
    more questions?
        Mr. Inhofe. I think I need to.
        Mr. Whitfield. You need to go?
        Mr. Inhofe. Yes.
        Mr. Whitfield. All right. Well, we appreciate very much
    your taking time to be with us, and we may very well have
    another hearing----
        Mr. Inhofe. Let me thank you, because this is only the
    third since 1984 when I left this that I have been invited to
    appear----
        Mr. Rush. Point of order, Mr. Chairman.
        Mr. Inhofe [continuing]. And I appreciate it.
        Mr. Rush. Point of order, Mr. Chairman.
        Mr. Whitfield. Yes, sir.
        Mr. Rush. Mr. Chairman, I just want to make sure that the
    record accurately reflects that Secretary Chu indicated that he
    had a conflict in scheduling. He didn't decline. It was just a
    conflict in his schedule.
        Mr. Whitfield. Well, we advised Secretary Chu but he had a
    conflict in his schedule. Thank you.
        OK. We will now call our second witness. Thank you, Senator
    Inhofe. And our second witness is the Honorable Lisa Jackson,
    Administrator of the United States Environmental Protection
    Agency, and we are looking forward to her testimony. Ms.
    Jackson, thank you very much for taking the time to join us
    today. We are looking forward to your testimony and the
    opportunity to ask questions. With that, I am going to go on
    and recognize you for an opening statement. I will say that
    Senator Inhofe ended up taking almost 7 minutes in his opening
    statement, so we would be happy to give you 7 minutes in your
    opening statement, so you are recognized.

        STATEMENT OF LISA JACKSON, ADMINISTRATOR, ENVIRONMENTAL
                           PROTECTION AGENCY

        Ms. Jackson. Well, thank you, Mr. Chairman. I will try not
    to take all seven.
        To you, Mr. Chairman and members of the Committee, thank
    you for inviting me to testify about Chairman Upton's draft
    bill to eliminate portions of the Clean Air Act, the landmark
    law that all American children and adults rely on to protect
    them from harmful air pollution. The bill appears to be part of
    a broader effort in this Congress to delay, weaken or eliminate
    Clean Air Act protections of the American public. I
    respectfully ask the members of this committee to keep in mind
    that EPA's implementation of the Clean Air Act saves millions
    of American children and adults from the debilitating and
    expensive illnesses that occur when smokestacks and tailpipes
    release unrestricted amounts of harmful pollution into the air
    we breathe. Last year alone, EPA's implementation of the Clean
    Air Act saved more than 160,000 American lives, avoided more
    than 100,000 hospital visits, prevented millions of cases of
    respiratory illness including bronchitis and asthma, enhanced
    productivity by preventing millions of lost work days, and kept
    American kids healthy and in school.
        EPA's implementation of the Act also has contributed to
    dynamic growth in the U.S. environmental technology industry
    and its workforce. In 2008, that industry generated nearly $300
    billion in revenues and $44 billion in exports. Yesterday the
    University of Massachusetts and Ceres released an analysis
    finding that two of the updated Clean Air Act standards EPA is
    preparing to establish for mercury, soot, smog and other
    harmful air pollutants from power plants will create nearly 1.5
    million jobs over the next 5 years.
        As you know, Mr. Chairman, the Supreme Court concluded in
    2007 that the Clean Air Act definition of ``air pollutant''
    includes greenhouse gas emissions. The Court rejected the EPA
    Administrator's refusal to determine whether that pollution
    endangers Americans' health and welfare. Based on the best
    available peer-reviewed science, EPA found in 2009 that manmade
    greenhouse gas emissions do threaten the health and welfare of
    the American people. EPA is not alone in reaching that
    conclusion. The National Academy of Sciences has stated that
    there is a strong, credible body of evidence based on multiple
    lines of research, documenting that the climate is changing and
    that the changes are in large part caused by human activities.
    Eighteen of America's leading scientific societies have written
    that multiple lines of evidence show humans are changing the
    climate, that contrary assertions are inconsistent with an
    objective assessment of the vast body of peer-reviewed science
    and that ongoing climate change will have broad impacts on
    society, including the global economy and the environment.
        Chairman Upton's bill would, in its own words, repeal that
    scientific finding. Politicians overruling scientists on a
    scientific question: that would become part of this committee's
    legacy.
        Last April, EPA and the Department of Transportation
    completed harmonized standards under the Clean Air Act and the
    Energy Independence and Security Act to decrease the oil
    consumption and greenhouse gas emissions of model year 2012-
    2016 cars and light trucks sold in the United States. Chairman
    Upton's bill would block President Obama's plan to follow up
    with Clean Air Act standards for cars and light trucks of model
    years 2017 through 2025. Removing the Clean Air Act from the
    equation would forfeit pollution reductions and oil savings on
    a massive scale, increasing America's debilitating oil
    dependence.
        EPA and many of its State partners have now begun
    implementing safeguards under the Clean Air Act to address
    carbon pollution from the largest facilities when they are
    built or expanded. A collection of 11 electric power companies
    called EPA's action a reasonable approach focusing on improving
    the energy efficiency of new power plants and large industrial
    facilities. And EPA has announced a schedule to establish
    uniform Clean Air Act performance standards for limiting carbon
    pollution at America's power plants and oil refineries. Those
    standards will be developed with extensive stakeholder input
    including from industry. They will reflect careful
    consideration of cost and will incorporate compliance
    flexibility.
        Chairman Upton's bill would block that reasonable approach.
    The Small Business Majority and the Main Street Alliance have
    pointed out that such blocking action would have negative
    implications for many businesses, large and small, that have
    enacted new practices to reduce their carbon footprint as part
    of their business models. They also write that it would hamper
    the growth of the clean energy sector of the U.S. economy, a
    sector that a majority of small business owners view as
    essential to their ability to compete.
        Chairman Upton's bill would have additional negative
    impacts that its drafters might not have intended. For example,
    it would prohibit EPA from taking further actions to implement
    the Renewable Fuels Program, which promotes the domestic
    production of advanced biofuels.
        I hope this information has been helpful to the committee,
    and I look forward to your questions. Thank you.
        [The prepared statement of Ms. Jackson follows:]

        [GRAPHIC] [TIFF OMITTED] T5734.097

        [GRAPHIC] [TIFF OMITTED] T5734.098

        Mr. Whitfield. Ms. Jackson, thank you very much.
        Before you came in, I had mentioned in my opening statement
    that Congress had specifically looked at regulating greenhouse
    gases on three different occasions: one in 1990 when the last
    Clean Air Act Amendments were adopted. They rejected it then.
    Number two, 1998, when the Senate voted 95 to 0 not to take up
    the Kyoto Protocol, objecting to the greenhouse gas regulations
    in the Kyoto Protocol, and then last when the U.S. Congress
    refused to adopt the cap-and-trade bill. So Congress on three
    separate occasions has spoken very clearly that in its opinion
    we do not need to regulate greenhouse gases. So I would ask you
    the question just your personal opinion, do you object to
    Congress having an up or down vote approving or disallowing
    EPA's greenhouse gas regulations?
        Ms. Jackson. Sir, I am here to explain the impact of our
    greenhouse gas regulations and then Congress is obviously going
    to make a determination whether----
        Mr. Whitfield. So you wouldn't object to Congress having an
    up or down vote on your regulations then, correct?
        Ms. Jackson. Sir, I would not presume to tell Congress its
    business.
        Mr. Whitfield. Thank you. Now, I want to ask you, did your
    agency conduct an overall comprehensive assessment of the cost
    of the greenhouse gas regulations?
        Ms. Jackson. We conducted assessments of costs of
    regulations. We did not conduct an assessment of the cost of
    the endangerment finding because it is a scientific finding.
        Mr. Whitfield. But do you have any idea what the costs of
    the greenhouse gas regulations would be?
        Ms. Jackson. As we propose regulations, for example, the
    cars rule that I mentioned in my opening statement, we do a
    regulatory impact analysis that is required----
        Mr. Whitfield. And by the way, on the car thing, it is my
    understanding that cost $52 billion. Is that correct?
        Ms. Jackson. The cost of the cars and trucks rule, I don't
    have the exact number in front of me, but----
        Mr. Whitfield. Well, my understanding----
        Ms. Jackson [continuing]. We also did----
        Mr. Whitfield [continuing]. The light-duty vehicle rule,
    according to the information I have, cost $52 billion and will
    increase in 2016 the cost of one of those vehicles by $948.
    Now, we recognize cost goes along with regulations but it is
    also the information that we have that by the year 2100, the
    greenhouse gas standards for the light-duty vehicle is expected
    to reduce global temperatures by .006 degrees Centigrade, $52
    billion, and that is about mobile sources, and I don't think
    anyone has any idea what the regulation of stationary sources
    will be. Would you give us a guess on what the cost would be on
    that?
        Ms. Jackson. Mr. Chairman, just two points. The auto rules
    that you speak about were hailed by the industry, consumers,
    and environmentalists because of cost savings. There are
    efficiency rules for automobiles and trucks and so they pay for
    themselves, and as the price of gas increases, they pay for
    themselves in shorter and shorter periods. I believe at the
    time the estimate was somewhere between 3 and 4 years. So the
    money you save on gasoline----
        Mr. Whitfield. You know, another understanding that I have
    is that there really is no technology available to really
    reduce greenhouse gases other than efficiencies. Would you
    agree with that?
        Ms. Jackson. There are emerging technologies for stationary
    sources but energy efficiency is thought to be the low-hanging
    fruit in terms of----
        Mr. Whitfield. And that is my understanding, that we are
    getting ready to implement this tremendous greenhouse gas
    regulation. In fact, your air chief indicated that if your
    tailoring rule is determined to be illegal, that EPA is going
    to require 6 million sources to obtain Title V operating
    permits and would have to have 82,000 permitting actions under
    the PSD program resulting in an estimated $22.5 billion just
    for the permitting authorities.
        Ms. Jackson. It sounds like you agree with me, that the
    tailoring rule is a good idea to protect small businesses
    from----
        Mr. Whitfield. But it----
        Ms. Jackson [continuing]. Unneeded regulation.
        Mr. Whitfield. Doesn't it explicitly violate the language
    of the Clean Air Act which says specifically if it is 100 or
    250 tons per year emitting, that it must be regulated?
        Ms. Jackson. No, sir, I don't see it as a violation. I see
    it as looking----
        Mr. Whitfield. But that is what the language says, doesn't
    it?
        Ms. Jackson. The legal theory----
        Mr. Whitfield. And your tailoring rule says what, 25,000
    tons, or is it 75,000 tons?
        Ms. Jackson. It is 100,000 tons, equivalent of a railroad
    car----
        Mr. Whitfield. Tell me about this--well, my time is
    expired. Thank you, Ms. Jackson.
        I recognize at this time Mr. Rush.
        Mr. Rush. Well, Administrator Jackson, I am certainly glad
    to see that you finally arrived. It wasn't easy getting you
    here but you are here.
        First of all, do you have a scientific or a technical
    background?
        Ms. Jackson. Yes, sir, I am a chemical engineer by
    training. I have a master's degree in chemical engineering from
    Princeton University and an undergraduate degree from Tulane
    University.
        Mr. Rush. Well, I am glad to know that. I am glad to know
    that we do finally have someone with a scientific background
    here on the panel.
        Do you find it as amazing as I do that the subcommittee has
    not called any scientists, medical professionals, biologists,
    ecologists or any other scientists to consider this draft
    legislation? What do you think about that?
        Ms. Jackson. Sir, I think if this is going to be a
    referendum on a scientific question, it would be important to
    hear from the best scientists in our country.
        Mr. Rush. Thank you very much. The legislation we are
    considering today overturns your scientific determination that
    carbon emissions are dangerous, and I am concerned about the
    precedent that this would set. Whether carbon pollution is
    dangerous or not is fundamentally, I agree with you, a
    scientific question and not a political question. I believe
    that we should leave these types of decisions to expert
    scientists. Are you aware of any precedent for Congress to
    overrule EPA or any other agency on a question of science like
    this?
        Ms. Jackson. I am not aware of it, sir.
        Mr. Rush. Chairman Upton said yesterday that he does not
    believe that climate change is caused by human pollution. That
    certainly is an extreme view that has been rejected time and
    time again by scientists, so now he is trying a different
    approach. He is asking this committee to approve legislation
    that says he is right and the scientific community has made a
    glaring mistake. I don't believe that is the right way for us
    to proceed. We should be telling you to listen to America's
    best scientists and not ignore them because Chairman Inhofe or
    Chairman Upton have decided that they don't like their
    conclusions. Senator Inhofe testified earlier just a few
    moments ago that the science on climate change is mixed but
    that the economics are not. As I stated during my questioning
    of the Senator, the Clean Air Act has been the catalyst for
    creating close to 2 million jobs and creating an industry
    generating $300 billion in revenues. Are the economics as mixed
    as Senator Inhofe suggests, in your opinion?
        Ms. Jackson. Sir, the history of the Clean Air Act's
    implementation I think is consistent with what we would see for
    its implementation with carbon dioxide and greenhouse gas
    pollution, and that is that our economy can grow and thrive
    because of innovation while we reduce pollution and increase
    energy efficiency.
        Mr. Rush. Thank you, Mr. Chairman. I yield back.
        Mr. Whitfield. At this time I recognize the gentleman from
    Michigan, Mr. Upton, for 5 minutes.
        Mr. Upton. Thank you. Mr. Chairman, and welcome,
    Administrator. You found a parking place okay?
        Ms. Jackson. I didn't find a parking place but I am here.
        Mr. Upton. We had one right out there in the horseshoe. I
    checked with the police in advance.
        Ms. Jackson. Thank you.
        Mr. Upton. I want to ask one quick question on maybe an
    unrelated topic first, and that is the boiler MACT rules. As
    you know, you all asked for a 15-month extension back in
    December, and the court said no, we want them done by, I want
    to say the 21st of February. Would it be helpful, useful,
    constructive if we gave you a little assistance legislatively
    to extend that deadline? Yes or no.
        Ms. Jackson. The EPA argued that we will need to make
    administrative re-proposal of the rule in order to increase the
    amount of transparency in the time that we have, and I am
    disappointed that we have to get the rule out but we will use
    the current administrative processes under the Clean Air Act to
    ensure that the American public and industry gets a chance to
    look at these new rules. They will be significantly different.
        Mr. Upton. So would you like a little, sort of like----
        Ms. Jackson. I believe the Clean Air Act is strong enough
    to allow for that kind of transparency.
        Mr. Upton. OMB is not here. You can say whatever you want.
    You can give the truth. Never mind.
        Let me go to this hearing. You have petitioned to set GHG
    standards for agriculture emissions. We have the Farm Bureau
    coming on a later panel this afternoon. Do you intend to act on
    the agriculture emissions as part of GHG?
        Ms. Jackson. The number of agricultural sources subjected
    to EPA's reporting rule is zero. The number of agricultural
    sources that would face any regulation for greenhouse gas
    emissions under Clean Air Act permitting before July, 2013 is
    zero, sir.
        Mr. Upton. There are GHG emissions from non-road vehicles,
    ships, boats, planes, railroads. Do you intend to set any
    standards for those types of vehicles?
        Ms. Jackson. We have certainly, sir, been petitioned to do
    so. We have made no determination on a regulatory calendar that
    I have been briefed on.
        Mr. Upton. My State of Michigan, there have been some
    reports that the implications of EPA GHG regs for the Michigan
    economy would do a number of things: reduce Michigan GDP by $18
    billion, destroy 96,000 jobs, reduce household incomes by
    nearly $1,600 and reduce Michigan manufacturing output by $2.3
    billion. Those are independent estimates. Has EPA done an
    analysis of what the full costs of regulating GHGs under the
    Clean Air Act would be by State or by the entire country?
        Ms. Jackson. We have done impact analysis and economic
    analysis as we propose and finalize regulations, sir, but the
    analysis you are referring to is of regulations we have yet to
    propose and implications that therefore would be unfair. We
    would actually have to go to industry and ask them to tell us
    what it is they are planning to do in order to tell them what
    the impacts might be so that is a very difficult hurdle and
    probably not one that industry would welcome.
        Mr. Upton. A number of us have commented about the
    regulations that could be imposed in this country versus on
    employers overseas. Does EPA intend to look at the potential of
    jobs leaving the United States and going someplace else? Is
    that going to be a factor that is going to be considered as the
    regulations are pursued?
        Ms. Jackson. Certainly part of our economic analysis is an
    impact on jobs, both jobs that could be lost but also jobs that
    could be gained, and you heard in my opening statement that
    there are potentials for our environmental and air pollution
    control industry jobs to actually have increases.
        Mr. Upton. And that figure, what was it? How many jobs? I
    know you cited--did you say 96,000?
        Ms. Jackson. I believe there was a study yesterday that
    talked about nearly 1.5 million jobs over the next 5 years.
    That was not an EPA study, that was University of Massachusetts
    and CERES. That is an independent study.
        Mr. Upton. So if the Continuing Resolution which might be a
    funding freeze at 2008 levels is adopted, that would be--you
    would have a pretty difficult reaching that number of
    inspectors. Would these be EPA government jobs?
        Ms. Jackson. Sir, this was an independent----
        Mr. Upton. Would they be contracted out?
        Ms. Jackson. No, no. These are not government jobs in any
    way, and with respect to your question on budget, the EPA's
    regulatory authority incentivizes and promotes innovation in
    the private sector. It promotes investments here. There are
    estimates that there is almost $2 trillion waiting to be
    invested in this country, and that is what that study is----
        Mr. Upton. I mean, what I am interested in is the net
    increase or decrease in jobs, and you may have more inspectors
    that are out there but at the same time you might not have
    nearly as many companies still producing goods here because
    they might go someplace else. I am more concerned about a
    dramatic net loss of jobs rather than an increase based on the
    proposal.
        So I see my time is expired. Thank you, Mr. Chairman.
        Ms. Jackson. I just want to clear up for the record, I
    don't know what net increase in inspectors you are speaking of.
    I do believe that we remain committed to enforcing the Clean
    Air Act but none of the jobs numbers that I speak about are
    public sector employment, they are private sector employment.
    Thank you.
        Mr. Whitfield. The gentleman from California is recognized
    for 5 minutes.
        Mr. Waxman. Thank you, Mr. Chairman.
        Administrator Jackson, the Republicans have made the
    argument that you don't have the authority under the Clean Air
    Act to do this regulation of greenhouse gases. Are they right?
        Ms. Jackson. No, sir, they are not.
        Mr. Waxman. The Clean Air Act requires you to regulate
    carbon emissions?
        Ms. Jackson. Yes. As the Supreme Court said, greenhouse gas
    emissions fit within the definition of pollution under the
    Clean Air Act.
        Mr. Waxman. Republicans further have made the argument that
    public health is not at risk from these greenhouse gases. Could
    that be true?
        Ms. Jackson. No, sir, I don't believe that to be the case.
    The endangerment finding is about that very issue, and in that
    finding, we determined that unchecked greenhouse gas emissions
    increase the intensity and duration of heat waves. That
    increases heat-related mortality and morbidity, especially
    among children, among the elderly, among the sick, people who
    work outdoors, people who can't afford air conditioning or have
    never needed it because their climate was temperate enough. By
    raising temperatures, you also exacerbate the impact of smog,
    and we know the life-threatening impacts of smog on people who
    have compromised lung function, especially people with asthma
    and other lung diseases. Unchecked emissions are said by our
    best scientists to increase the severity of flooding, and
    having grown up in New Orleans and seeing the impacts of
    flooding on just one small part of the town, the part I know, I
    know that that also means more contamination, more pollution,
    more disease as we deal with the impacts of our changing
    climate.
        Mr. Waxman. So this is really a threat to the public
    health, and if we don't regulate we are allowing that threat to
    become greater?
        Ms. Jackson. That is the nexus of the endangerment finding.
    It is a threat to our public health as Americans and our
    welfare, sir.
        Mr. Waxman. You have been criticized for this finding that
    greenhouse gases endanger the public. Mr. Abbott, the Texas
    Attorney General, claims that the finding is arbitrary and
    legally flawed. We learned yesterday, however, that your
    predecessor in the Bush Administration looked at the science
    and apparently reached the same conclusion you did. In a
    private letter to President Bush, Administrator Johnson stated,
    and I quote, ``The latest science on climate change requires
    the Agency to propose a positive endangerment finding as was
    agreed to at the Cabinet-level meeting in November.'' According
    to Mr. Johnson, ``The latest climate change science does not
    permit a negative finding nor does it permit a credible finding
    that we need to wait for more research.'' And I gather Mr.
    Johnson didn't like to have to say that because he is not happy
    about the proposals that you have made, but as a matter of
    fact, what you have proposed is very similar to what he would
    have had to propose as well. Are you surprised that the
    predecessor in the Bush Administration privately reached the
    same conclusion that you have?
        Ms. Jackson. I think that the letter which I saw yesterday
    when it was released is proof that it is not me sitting in the
    administrator's chair who looks at the science and makes a
    finding of endangerment but clearly past administrators have
    felt and have believed the same based on their----
        Mr. Waxman. Well, once you have reached those findings,
    once you have reached the conclusion that this is not a hoax
    but that public health and welfare are endangered, then the
    question is, what do we do about it? And the Republican
    approach is not to let anything be done, not to pass
    legislation--they didn't offer an alternative to our bill last
    year--not let EPA act. In fact, they would go so far as to say
    that you can't even allow some of the voluntary efforts to
    report and try to reduce carbon emissions. You are being
    vilified for proposing the same measure that your Republican
    predecessor called ``prudent, responsible, cost-effective, and
    practical.'' Both Republican and Democratic Administrators saw
    the same science and reached the same conclusion.
    Unfortunately, President Bush and his people told Administrator
    Johnson don't move forward on it. You represent a President
    that wants to protect the public health, safety, and well-being
    and he has allowed you to do your job. I think that Congress
    ought to allow you to do your job as well. And if we have an
    alternative, let us hear what it is, but saying there is no
    problem, it is all a hoax, is not a responsible answer.
        Thank you, Mr. Chairman.
        Mr. Whitfield. I recognize the gentleman from Texas for 5
    minutes.
        Mr. Barton. Thank you. Thank you, Mr. Chairman.
        The Minority seems to be of the impression that we didn't
    want you to attend, Madam Administrator. We are delighted you
    are here. If I knew you better, I would come down and hug you.
    I can assure you that Chairman Upton and Chairman Whitfield and
    Chairman Stearns are going to invite you numerous times, you
    and your deputies, to come before this committee and its
    various subcommittees for the next 2 years. So welcome, and we
    do appreciate your attendance.
        I need to educate the subcommittee briefly before I start
    asking my questions because there is an attempt by Chairman
    Waxman and perhaps by yourself to rewrite history. The Clean
    Air Act does not specifically mention CO2 as a
    criteria pollutant. The reference that Mr. Inslee made talks
    about ozone, not carbon dioxide. The court case in
    Massachusetts v. EPA was a 5-4 decision in which the majority
    of the Supreme Court said that since it did not explicitly
    prohibit CO2 being regulated under the Clean Air
    Act, it might could be, and the EPA needed to--I don't think
    the EPA needed to but it said the EPA could make a decision.
        As you well know, when your Administration, Mr. Obama,
    President Obama, came into office very quickly issued an
    endangerment finding, saying that CO2 should be
    regulated. Mr. Waxman alluded to a private letter that has
    miraculously come forward in the last day or so for this
    hearing, and I would emphasize the term ``private.'' I would
    hope that maybe we could get Carol Brown's private
    correspondence and some of the other Obama officials' private
    correspondence. We do have some e-mails from the direct
    supervisor of Mr. Carlin back and forth to people in the White
    House in which Mr. Carlin is explicitly told stop investigating
    whether CO2 is a danger, the decision has been made,
    the White House has decided that they are going to issue a
    endangerment working, stop working on this report. I don't have
    those e-mails with me but they are available.
        So I am going to ask you the same question that I asked
    Senator Inhofe. Under the Clean Air Act, which is the law of
    the land, as amended, does anything in Mr. Whitfield's and Mr.
    Upton's pending legislation change the standard on ozone?
        Ms. Jackson. The----
        Mr. Barton. The answer is no.
        Ms. Jackson. Would you like me to answer, sir?
        Mr. Barton. Well, I am willing if you will go through it
    quickly. I have got a minute and 50 seconds here.
        Ms. Jackson. I see. Well, what I would say is that I am
    concerned that there needs to be an analysis to ensure that
    there aren't unintended consequences. My belief is that there
    is no intention in the legislation----
        Mr. Barton. But the legislation does not change the
    standard on ozone, it does not change the standard on
    particulate matter, it does not change the standard on carbon
    monoxide, it does not change the standard on NOx, it
    does not change the standard on sulfur dioxide and it does not
    change the standard on lead, does not change the enforcement
    criteria, does not change the quantities, does not change any
    of the Clean Air Act on the criteria pollutants that this
    committee amended and passed back in 1990. Is that not correct?
        Ms. Jackson. I believe the intent is only to gut portions
    of the Clean Air Act, sir, not----
        Mr. Barton. That is the Clean Air Act.
        Ms. Jackson. But it is changing, gutting portions of the
    Clean Air Act----
        Mr. Barton. How?
        Ms. Jackson [continuing]. For certain pollution, some of
    which is pollution----
        Mr. Barton. CO2----
        Ms. Jackson [continuing]. Not only because it is a
    greenhouse gas.
        Mr. Barton. Madam Administrator, CO2 is not
    mentioned in the Clean Air Act. It is a 5-4 decision that it
    might be. It is your Administration's position that it should
    be. I respect that. I respect that. But that doesn't mean that
    it has to be, and unless you can refute all these cost-benefit
    analyses that have been done independently about the millions
    of jobs and hundreds of billions of dollars per year, I would
    say that the Congress as an independent arm of the Federal
    Government has an obligation to clarify what the Clean Air Act
    really does regulate. That is our obligation. Do you have an
    objection to that?
        Ms. Jackson. Again, sir, I would not presume to tell the
    Congress its business in any way.
        Mr. Barton. Well, my time is expired. I am going to yield
    back. I am going to ask you some specific questions in writing
    about what you are doing in Texas. You have denied every
    existing air permit issued since 1992, and we are going to ask
    some specific questions about that. Thank you.
        Mr. Whitfield. I recognize the gentleman from Michigan for
    5 minutes of questions.
        Mr. Dingell. Mr. Chairman, I thank you.
        Madam Administrator, welcome to the committee. I have a
    number of questions on which I would like, if possible, to get
    yes or no answers, and I say that with respect.
        EPA has already issued regulations under Title II of the
    Clean Air Act. It has issued its determinations for regulations
    under the Title V permit program and it is also for under
    sections 111 for the prevention of significant deterioration,
    and in addition to that, it would appear that EPA can issue
    regulations under the National Ambient Air Quality Program. Is
    that correct?
        Ms. Jackson. Yes, sir.
        Mr. Dingell. So we have a potential here then for at least
    four different sets of regulations plus State implementation
    plans which could also cover these questions?
        Ms. Jackson. Yes, sir.
        Mr. Dingell. So you have an unholy complicated mess here if
    you are going to regulate greenhouse gases. Is that right?
        Ms. Jackson. Pursuant to the Clean Air Act, those are all
    requirements, sir.
        Mr. Dingell. Now, Madam Administrator, what other
    provisions of the Clean Air Act can EPA use to issue
    regulations in the next 5 years in terms of greenhouse gas
    emissions?
        Ms. Jackson. Sir, did you mention the new source
    performance standard provisions of the Clean Air Act? EPA has
    already announced the schedule to put forth new source
    performance standards for utility sector and for the refinery
    sector. I know you said 5 years, but those are in the next 2
    years.
        Mr. Dingell. This gives you an unbelievably complicated
    process, especially if you are going to bring the States into
    the matter as required under the state implementation plans.
        Now, Madam Administrator, how many different regulations to
    introduce greenhouse gas emissions could this add up to? I
    don't think you can tell us here this morning, and I am not
    sure anybody including the prophet Esau can give us that
    number. But would you please submit for the record the number
    of potential regulations and the number of potential regulatory
    sources under the statute that are going to be used here.
        Now, Madam Administrator, so it is clear that these
    regulations could add up to a great multiplicity of stationary
    and mobile source controls. Isn't that right?
        Ms. Jackson. Yes, sir, but I do want to point out that the
    purpose of tailoring rule was to manage that workload in a way
    that ensures that the vast majority of sources would not be
    caught----
        Mr. Dingell. Madam Administrator----
        Ms. Jackson [continuing]. Under the Clean Air Act.
        Mr. Dingell [continuing]. This is not to criticize you, it
    is to try and dig you out of an intolerable hole in which I
    find you, and I am looking forward to your help in achieving
    that very important purpose.
        Now, under the provisions of the bill before us, should
    this legislation become law, it would repeal the endangerment
    finding. Does that put the national standards at risk? Yes or
    no.
        Ms. Jackson. Yes, sir, I would think it would invite
    litigation on past standards, and future standards are
    explicitly prohibited under the draft.
        Mr. Dingell. Now, Madam Administrator, do you and the
    Administration firmly support a national standard for auto fuel
    economy and greenhouse gas emissions, and are you committed to
    a single national standard for the model years 2017 to 2025?
        Ms. Jackson. Yes, sir, we are very much committed to
    working collaboratively with the industry and the States and
    staying at the table as we did for the standards that we put
    out in May of 2010.
        Mr. Dingell. Now, does the draft legislation prevent EPA
    from enforcing greenhouse gas reporting rule which contains
    information that could inform the Congress relative to the
    Congress's future action? Yes or no.
        Ms. Jackson. Yes, sir.
        Mr. Dingell. Now, Madam Administrator, EPA's endangerment
    finding, let us refer to that, was that or is that a scientific
    finding or a political finding?
        Ms. Jackson. It is a scientific finding, sir.
        Mr. Dingell. Now, Madam Administrator, could EPA have found
    otherwise than it did?
        Ms. Jackson. No, I do not believe so, sir.
        Mr. Dingell. Madam Administrator, did your predecessors in
    the previous Administration, that of Mr. Bush, find or propose
    otherwise than you have done?
        Ms. Jackson. An endangerment finding was prepared and sent
    to the White House but the White House did not open the e-
    mails.
        Mr. Dingell. OK. We have done it with 7 seconds overrun.
    Thank you.
        Ms. Jackson. Sir, may I correct one inaccuracy in my
    answer? National ambient air quality standards and State
    implementation plans are not required for greenhouse gases at
    this time. We have been petitioned with respect to that matter.
    Thank you.
        Mr. Dingell. But I should be somewhat concerned that a
    court which would make a finding that the Clean Air Act
    affected greenhouse gases, that they might insist that that
    also be used on the State implementation plans. Isn't that so?
        Ms. Jackson. Yes, sir. I just wanted to be clear on the
    current state of----
        Mr. Whitfield. I recognize the gentleman from Illinois, Mr.
    Shimkus.
        Mr. Shimkus. Thank you, Mr. Chairman.
        Welcome, Administrator Jackson. Just so we don't get into a
    debate next week when we have our hearing on the environment
    and job creation, I am formally asking you if you would like to
    return to talk, to address my subcommittee that deals with a
    huge portion of the portfolio and also jobs. This hearing is
    about jobs, and that is why we are focused on it. So I will
    give you time to think about it, but I am formally asking you
    if you would like to join us next week at our hearing.
        This hearing is about jobs, and there is a chart on the
    screen, and I don't know if you have ever seen it, the National
    Environmental Policy Act and Environmental Protection Agency
    were both first authorized in 1970. Have you ever seen this
    char? Has it ever occurred to you that there appears to be a
    cause and effect between U.S. oil imports and these policies?
    If you look, what it is up there is production and imports, and
    as we have been involved with, and a lot of us would agree,
    important Clean Air Act amendments, it has affected jobs and
    our reliance on imported crude oil. Have you ever seen that,
    and do you think there's a relation?
        Ms. Jackson. Sir, it is the first time I am seeing this
    particular chart, and what I do know is that the energy
    efficiency and ability----
        Mr. Shimkus. But you wouldn't dispute that our importation
    and our ability to produce has declined? I mean, those are just
    Energy Information Agency. Timeliness with the Clean Air Act
    and Clean Air Act Amendments, it has had an effect on our
    energy production. Well, let me move on. I will give you a
    chance to look at that, and maybe next week----
        Ms. Jackson. I don't see anything on that chart that talks
    about the Clean Air Act, sir, but I would be happy to----
        Mr. Shimkus. Well, it is related to the time frame on the
    bottom with 1970, so this is a timeline from 1920 to 2000, so--
    --
        Ms. Jackson. I am sure there are a lot of things that
    happened in 1970 that can't be attributed----
        Mr. Shimkus. Let me just go back now to other issues. This
    is about job creation and the effect that the Environmental
    Protection Agency has, and we are going to hear the testimonies
    when we have the next panel. Let me--you recognize these folks,
    right? And my friends on the other side. These are the folks
    that were affected by the 1992 Clean Air Act Amendments. This
    is from Kincaid Mine in my district. One thousand miners' jobs
    were closed because of the Clean Air Act. The reason why we
    could not pass into law through the Senate Waxman-Markey is
    because we successfully made the argument that this would
    create higher cost energy and jobs would be destroyed, and
    these folks should be awarded a medal for stopping the job-
    destroying aspects of the Waxman-Markey bill. Illinois lost
    14,000 jobs during the last round, and Ohio lost 35,000 jobs
    during the Clean Air Act Amendments.
        And so this hearing is about jobs and the effects of jobs,
    and I think we can make an argument on carbon dioxide not being
    a criteria pollutant under the Clean Air Act and that we have
    gone around the legislative ability by using the courts and
    using regulatory authority to regulate something that should
    not be regulated but let us assume you all are successful. I
    have in front of me a power plant that is being built, 1,600
    megawatts. If we mandate them to reduce carbon dioxide
    emittance by 60 percent, what amount of the energy that they
    produce will have to be used to capture that carbon? Do you
    know what that is?
        Ms. Jackson. Sir, I am sure you are going to give me the
    number.
        Mr. Shimkus. It is 22 percent. The energy that they are
    going to put on the grid will now have to capture. If they go
    to 85 percent, do you know how much energy that would require?
    Thirty percent of what they were going to put on the grid to
    sell. Do you believe in the law of supply and demand?
        Ms. Jackson. Do I believe in the law of----
        Mr. Shimkus. Supply and demand, economics 101.
        Ms. Jackson. The economic principle of supply and demand?
    It is not a tenet of faith, sir. It is a----
        Mr. Shimkus. No. Do you believe it?
        Ms. Jackson [continuing]. An economic model, and I was
    trained in it.
        Mr. Shimkus. Do you believe it?
        Ms. Jackson. Yes, I believe that it is generally----
        Mr. Shimkus. That if you constrain a product and there is a
    high demand, that costs go up?
        Ms. Jackson. It depends on the elasticity of the cost
    curves.
        Mr. Shimkus. And I would say that here is an example of us
    having power on the grid that this regulation is now going to
    constrain because we are going to have to use energy to capture
    carbon which is not energy we can put on the grid so the people
    who are going to buy this have to buy, what, higher power. You
    know what the capital expense for this power plant is if they
    are going to build new facilities to capture carbon, what is
    the new capital expense at 60 percent? It is $1.8 billion. If
    it is 85 percent, their capital expense, this is new spending,
    $2.3 billion.
        Ms. Jackson. Sir, under the----
        Mr. Shimkus. Do you know where they have to go to pipe the
    carbon capture and sequestration, how far? We think the closest
    might be 70 miles. Who is going to pay for the pipeline? And
    then how big a sequestering facility has to be there? The point
    is, this regulation is going to skyrocket electricity costs,
    which will destroy jobs.
        I yield back my time, Mr. Chairman. Thank you.
        Mr. Whitfield. Thank you.
        Ms. Jackson. Sir, may I respond to just a few things for
    the record?
        Mr. Whitfield. Sure.
        Ms. Jackson. The first is, under the Clean Air Act, which
    is a public health----
        Mr. Shimkus. Mr. Chairman, I would like to, if she would
    yield, I would address this the same way that Chairman Waxman
    addressed Senator Inhofe and not allowing him, so if my
    colleagues on the other side want to give her time, they should
    do it on their time.
        Mr. Whitfield. Very good point.
        Mr. Inslee, you are recognized for 5 minutes.
        Mr. Inslee. Thank you. I think this is interesting, a 5-4
    Supreme Court decision was good enough in Bush v. Gore to be
    settled law. A 5-4 decision in United Citizens was good enough
    to allow corporations to run America. But all of a sudden a 5-4
    decision of the Supreme Court that you expect the EPA and us to
    just ignore.
        Now, I want to make sure that we are clear about this. The
    Supreme Court, which binds all of us who have taken an oath to
    the Constitution at the moment, says, ``Carbon dioxide,
    methane, nitric oxide and hydrofluorocarbons are without a
    doubt physical and chemical substances which are emitted into
    the ambient air. The statute is unambiguous.'' The statute is
    unambiguous. Madam Administrator, is it clear that you are
    bound by this decision and that we have got to regulate
    CO2?
        Ms. Jackson. Absolutely, sir.
        Mr. Inslee. And I want to tell you the last witness,
    Senator Inhofe, we appreciate him coming here. We know he is a
    person of strong beliefs. He tells us he is writing a box
    called The Hoax. Now, I haven't seen it but I think it is about
    the alleged Apollo moon landing on the lunar surface because we
    know there are people that are still out there doubting that.
    They are doubting that the National Academy of Science has
    confirmed we landed on the moon. They are doubting the IPCC
    that confirmed we have landed on the moon, but there are still
    those who doubt.
        And I want to ask you about the status of science on this.
    Could I have the picture of the Arctic put up, please? This is
    a picture, I am afraid it is not as visible as I would have
    liked. This is a picture of the current status of the Arctic
    ice cap in September. It is difficult to view, but there is a
    red line showing what the Arctic ice cap used to look like
    before we started dumping millions of tons of carbon dioxide
    into the atmosphere, and what it shows, that the Arctic ice cap
    has now shrunk about 40 percent by mass. Now, several years ago
    thought it was going to disappear in its entirety, and this is
    the air conditioner for the world. This is what controls the
    ambient air, bounces light back, and it is going to disappear.
    Now, scientists thought it was by 2040. Now we think it might
    be within this decade actually being gone.
        Now, my understanding of the status of the science,
    National Science Foundation, National Academy of Science,
    International Panel on Climate Change, 2,500 sciences who sent
    this committee a letter dated a couple days ago saying that
    this science is clear by compelling, cogent and consistent
    evidence in the peer-reviewed literature that we are having an
    impact on climate, visibly in many, many manifestations, this
    being just one of them.
        I have not been able to find--and I understand for
    political purposes people are trying to drum up questions about
    this. I understand politics. But I have not been able to find a
    peer-reviewed scientific study that challenges this finding of
    the consensus of scientists in America, including those who
    work for the United States Navy, and they do a pretty good job
    on our submarines. Is it a fair statement that there is wide,
    wide consensus about the science upon which you have made this
    finding?
        Ms. Jackson. Yes, sir, it is very broad and based on
    multiple lines of research.
        Mr. Inslee. And are you aware of any single peer-reviewed
    scientific journal which has questioned the foundations of the
    relationship between our actions on earth and the increase in
    CO2 in the atmosphere? Because I am not.
        Ms. Jackson. I am not, sir.
        Mr. Inslee. Now, I tell you what, I hear a lot of political
    flacks, I hear a lot of people on television saying the science
    is questionable, but we can't find one single peer-reviewed
    research study that has questioned this science, and I hope the
    people who are distributing information at this hearing will
    point out that the Republican Party that wants to pass this
    Dirty Air Act will not produce one single peer-reviewed
    scientific piece of literature which questions the finding of
    the Environmental Protection Agency. I think that is pretty
    stunning that they want to put our kids' health at risk and
    won't produce one peer-reviewed piece of research to support
    their conclusion.
        One last question on the economy. In fact, the research has
    shown that we increase our economy by a factor of three or four
    every time we make an investment under the Clean Air Act, and I
    want to put in the record, and you made reference to this. It
    is a study by industry and institutional investors. It is
    called New Jobs, Cleaner Air, and it finds as a result of your
    proposal, there will be an estimated job gain in Illinois of
    122,695 jobs associated with the new construction jobs, the new
    scientific jobs, the new jobs in utilities associated with
    making the air cleaner. Is it a fair thing to believe that as
    we make our air cleaner, we can grow our economy?
        Ms. Jackson. Yes, sir.
        Mr. Inslee. Thank you.
        Mr. Whitfield. I recognize the gentleman from Oklahoma, Mr.
    Sullivan.
        Mr. Sullivan. Thank you, Mr. Chairman, for holding this
    hearing. I would like to state that this hearing is not about
    science, it is about the destructive economic impacts of the
    EPA trying to use the Clean Air Act for what it was never
    designed to do: regulate greenhouse gases.
        Administrator Jackson, thank you for being here today. I
    have several companies my district ranging from chemical
    companies, manufacturing, energy companies, and they are scared
    to death of the EPA's pending rules on greenhouse gas. The
    energy industry in my State employs over 320,000 workers, and I
    intend to see that number grow by vigorously supporting this
    legislation. The Oklahoma Farm Bureau is also concerned with
    the GHG rule as they are the second largest industry in my
    State. Heck, Administrator Jackson, I even have churches that
    are concerned about this.
        You have been petitioned to set GHG standards for
    agriculture emissions. Do you intend to act on this?
        Ms. Jackson. Sir, as I stated earlier, there are no
    agricultural sources subject to EPA's mandatory reporting rule
    and no agricultural sources that need to address greenhouse gas
    emissions in Clean Air Act permits before July of 2013.
        Mr. Sullivan. So that would be no, just no?
        Ms. Jackson. Yes.
        Mr. Sullivan. Has EPA done an analysis on how much
    greenhouse gas regulations will impact the cost of producing
    food on farms and the price that American families will have to
    pay at the grocery store? We have a lot of people concerned
    that spend a lot of their money on groceries, you are taxing
    the food they eat that keeps them alive.
        Ms. Jackson. Sir, I just mentioned that we are not going to
    be regulating agricultural sources. They are not even subject
    to our mandatory reporting rule for greenhouse gases.
        Mr. Sullivan. But did you do any analysis on how it would
    affect the price of food at all? You don't do any of that, huh?
        Ms. Jackson. No, sir. When we analyze our regulations or,
    for example, as we analyzed legislation pending before this
    committee last year, we analyzed changes in potential energy
    costs, and of course its impact on the economy.
        Mr. Sullivan. Do you think it would be a good idea to
    require an economic analysis on how these rules impact family
    farms and the price of groceries? Is it that you don't know
    what the total economic impacts will be on the agricultural
    sector? All tolled, 17,000 farms nationwide are impacted by the
    EPA's greenhouse gas regulations.
        Ms. Jackson. Sir, we will do economic analysis of
    regulations as they are proposed and finalized. That is a
    process required under the Clean Air Act already.
        Mr. Sullivan. I am concerned that we have no idea what the
    avalanche of greenhouse gas rules will cost, costs that could
    shift and shatter the economy. The Obama Administration has
    come out recently with an initiative for regulatory reform
    seeking to be more business-friendly, stating that our
    regulatory system must take into account benefits and costs. On
    paper, we agree. Has the EPA done an analysis of what the full
    costs of regulating greenhouse gas under the Clean Air Act will
    be?
        Ms. Jackson. We do regular analyses, and of course, we will
    be complying with the Executive Order to do a cumulative review
    of all of our regulations. Under the Clean Air Act, we know
    that the benefits to costs of the Clean Air Act are 30 to 40 to
    one cumulatively, and in the regulations recently proposed are
    oftentimes at least double if not an order or two of magnitude
    higher. The benefits are higher than the cost.
        Mr. Sullivan. So you will be doing analysis. When will you
    be doing it? Do you know?
        Ms. Jackson. We will do economic analysis as part of the
    rulemaking process, sir.
        Mr. Sullivan. Has the EPA looked at the impact on jobs?
        Ms. Jackson. Yes. Just yesterday EPA put out a White Paper
    in response to a question from a member of this committee on
    jobs and the Clean Air Act, and it confirms that which we heard
    earlier today which is that having regulatory certainty allows
    businesses to innovate and give us clean air and grow our
    economy at the same time. That is the history and legacy of the
    Clean Air Act, sir. It is a very powerful piece of legislation.
        Mr. Sullivan. Have you looked at the risk of manufacturing
    jobs overseas? I hear that all the time, that people are going
    to do it if this happens. Do you look at that?
        Ms. Jackson. We do do an economic and jobs impacts analysis
    on regulations as part of the regulatory process, sir.
        Mr. Sullivan. But you haven't done that yet?
        Ms. Jackson. We do them for the regulations as they come
    out so----
        Mr. Sullivan. When will you be doing it?
        Ms. Jackson. The regulations are proposed for, for example,
    new source performance standards, we will do analysis as part
    of the regulatory process.
        Mr. Sullivan. Thank you. I yield back.
        Mr. Rush. Mr. Chairman?
        Mr. Whitfield. Yes?
        Mr. Rush. I respectfully request that the White Paper that
    the Secretary mentioned be entered into the record.
        Mr. Whitfield. Without objection.
        [The information appears at the conclusion of the hearing.]
        Mr. Whitfield. I recognize at this time Mr. Markey of
    Massachusetts.
        Mr. Markey. I thank the gentleman.
        This bill that we are considering, the Polluters Protection
    Act of 2011, repeals the scientific finding that global warming
    pollution is dangerous. It ties EPA's hands and prevents it
    from moving forward with any regulations to reduce global
    warming pollution. It even prevents EPA from thinking about
    global warming pollution as part of its other duties under the
    Clean Air Act. In George Orwell's 1984, Big Brother's faceless
    minions at the Ministry of Truth dispose of politically
    inconvenient facts by pitching them down a memory hole. Today,
    Big Oil and Big Coal have been working with the Republican
    thought police to comb through each and every reference to
    global warming pollution in the Clean Air Act and then
    disappear them, sending scientific consensus down the memory
    hole at the expense of public health and welfare. But their
    bill will create new jobs. The oil and the goal and the utility
    lobbyists who are here today and watching on the Web all across
    America, there are new people being hired in those industries
    to make sure that the EPA cannot do its job, and we
    congratulate you for that purpose.
        But what this bill also does is to bar EPA from doing
    anything further to reduce oil from cars, trucks, planes, boats
    or other sources. The legislation might even nullify the
    progress we have already made over at EPA in reducing demand
    for oil. The Republican bill could result in an increase in our
    dependence of more than 5 million barrels of oil per day by the
    year 2030, more than we currently import from OPEC. So that is
    what we are doing today. Tomorrow, in this very same
    subcommittee, we are holding a hearing on the impact of Middle
    East unrest and its impact on U.S. energy prices for consumers.
    That is like holding a hearing on repealing FDA's authority to
    regulate tobacco and then holding a hearing the very next day
    on the dangers of tobacco in creating lung cancer. Five million
    barrels of oil per day. At $90 per barrel, that is $164 billion
    a year we would send to OPEC if the Republicans are accurate.
    That would fund al-Qaeda. That would fund Hamas. That would
    fund Hezbollah. That would fund the Muslim Brotherhood. That is
    what this money would be used to accomplish. That is what their
    bill makes possible.
        Now, I understand why Arab oil sheiks and Oklahoma oilmen
    want the price of a barrel to continue to rise and to rise and
    to rise, but the consequences for American young men and women
    that we would have to send over there, the impact on our
    geopolitical status around the world would be devastating.
    Instead of holding the line so that we continue to back out
    that imported oil, the Republicans have offered us a unilateral
    disarmament policy that al-Qaeda and other groups around the
    world will be able to exploit as we send more money over there
    to import oil into our country.
        By repealing the endangerment finding, Republicans are
    endangering the current standards by opening up a litigation
    loophole in the current standards to reduce oil use in cars and
    light trucks, and Republicans are barring EPA from moving
    forward with any new standards at all. Do you agree, Madam
    Administrator, that this legislation would increase our
    dependence on foreign oil if you are prohibited from
    promulgating additional regulations to reduce our dependence
    upon that imported oil?
        Ms. Jackson. Yes, sir.
        Mr. Markey. Doesn't this bill also undermine the renewable
    fuel standards, which is driving the production of homegrown
    biofuels that will further our imports of oil from OPEC by 1.6
    million barrels of oil per day?
        Ms. Jackson. Yes, sir, I believe it does.
        Mr. Markey. Doesn't this bill also prevent EPA from setting
    standards to reduce oil use in trains, boats, planes, large
    trucks and other industrial sources, sources that account for
    almost 40 percent of all oil that we use each day?
        Ms. Jackson. Yes, sir, I believe it would.
        Mr. Markey. So basically what we have here then is
    legislation that is a regulatory relief bill for oilmen in
    Oklahoma and at OPEC that would allow for a tightening of the
    noose around the neck of American foreign policy and consumers
    that will come back to haunt us in years ahead because we did
    not use America's greatest strength, our technological genius,
    to improve the vehicles that we drive, improve the appliances
    which we use, improve the efficiency of the buildings within
    which we live so that we reduce dramatically the amount of
    energy that we have to consume and tell OPEC we don't need
    their oil anymore than we need their sand. That is what this
    hearing is all about and that is why this bill has an historic
    place in terms of its undermining of our national security.
        Mr. Whitfield. The gentleman from Oregon is recognized for
    5 minutes.
        Mr. Walden. Thank you, Mr. Chairman.
        Woody is back in town. I want to talk to you about biomass
    first off. You testified, and the Administration testified in
    support of the Waxman-Markey bill, and I would just like to
    know your scientific underpinning for supporting the provision
    that treated biogenic carbon emissions as if they were oil or
    gas when used in the production of renewable energy.
        Ms. Jackson. Sir, I recently wrote a letter saying that we
    believe that there is only limited climate impact through the
    combustion of certain biomass.
        Mr. Walden. Now, that is interesting because the scientists
    at the State University of New York, College of Environmental
    Science and Forestry contend that woody biomass is a
    substantial CO2-neutral renewable resource that can
    be used as a fuel for a variety of sustainable, environmentally
    sound energy applications. Do you disagree with that finding?
        Ms. Jackson. No, Mr. Walden. What I said is that I
    substantially agree that we need additional science because it
    may well be that many sources of biomass are neutral when it
    comes to greenhouse gas emissions.
        Mr. Walden. Do you think that there is a difference between
    woody biomass that is used for renewable energy that is
    produced on private, State or county land versus that comes off
    federal land?
        Ms. Jackson. Sir, I don't know what the difference would be
    except its source, and it would depend on the type of biomass.
        Mr. Walden. But if it were the same tree source, right? If
    you have a fir tree on one side of the line----
        Ms. Jackson. Scientifically, there is no difference on
    whose land the trees are.
        Mr. Walden. Right. So that is what perplexed me about your
    support for the Waxman-Markey bill that said woody biomass off
    federal land was different than the woody biomass off other
    lands when treated--when used to create renewable energy. It is
    a flaw.
        Now, in your tailoring rule--people in my district are real
    upset because there are a lot of rules, not just this one but
    others coming out that do affect the price of oil. I understand
    your agency just pulled the air permit on a Shell drilling
    operating Alaska that would have potentially reached into 35
    billion barrels of oil. They have gone through 35 other
    permits. That one has been pulled. If you want to talk about
    accessing America's great energy reserves, didn't you pull that
    air permit?
        Ms. Jackson. No, sir, actually we issued the permit. The
    courts--the Environmental Appeals Board ruled against the EPA-
    issued permit, sir.
        Mr. Walden. So what is your plan going forward there?
        Ms. Jackson. We have a motion to the Environmental Appeals
    Board for reconsideration, and we are working with the permit
    applicant to perfect the application and move forward as
    quickly as we can in response to the application.
        Mr. Waxman. Will the gentleman yield?
        Mr. Walden. No, I won't. I only have a minute ten, Mr.
    Chairman. Otherwise I would.
        Let us go back to the biomass issue because in the--a lot
    of us wrote you in a bipartisan way asking you to not move
    forward with the rule on biomass in the tailoring rules
    affecting biomass. You responded and said you are going to
    delay this for a couple of years. Now, the practical impact in
    a district like mine is, we have got a lot of people that want
    to invest in new high-tech biomass facilities, to turn woody
    biomass into renewable energy. They are concerned that you are
    going to come back in 2013 or later on with a rule that treats
    biomass as if it were coal or oil. Can you give us any
    indication that you won't do that?
        Ms. Jackson. I do know, sir, that the American Forest
    Products Association hailed the decision to defer for 3 years--
    --
        Mr. Walden. I am aware----
        Ms. Jackson [continuing]. To get the science, like the
    science you mentioned, to show the carbon neutrality of biomass
    fuel.
        Mr. Walden. But I want to get to my question. I know what
    they said. I know what I said. I was glad except I think we
    create this delay process where you are stifling investment.
    The President wants to see $2 trillion in private sector
    investment come off the shelves and get invested. It is rules
    like this that are causing the people trying to make those
    decisions to wait because they don't know what your agency is
    going to do in a couple of years that might affect them if they
    make that investment today. Because you could go back under the
    new source performance standards, could you not, and say no,
    actually we are going to regulate the burning of woody biomass
    as if it were----
        Ms. Jackson. I support the delay to get the best science,
    sir, to give scientists a chance to do the studies to determine
    how best to deal with biomass and to determine whether all
    biomass is created the same. It was a delay to review
    scientific----
        Mr. Walden. So you can't give us any certainty. So we are
    on delay for a couple years?
        Mr. Waxman. Mr. Chairman, I would ask unanimous consent
    that I be given 30 seconds to make a statement for the record.
        Mr. Whitfield. Does anybody object?
        Mr. Waxman. I just wanted to point out to the gentleman
    from Oregon that his criticism of our bill would have applied
    to its initial formulation, but by the time we passed the House
    floor, the biomass provisions were changed, and I think even in
    Oregon the industry was for it. But your criticism was of the
    draft bill that was in the committee, not the bill that passed.
        Mr. Walden. Well, Mr. Chairman, if I might respond to that?
        Mr. Waxman. I would be happy to yield.
        Mr. Walden. Indeed, there was criticism of the original
    language. However, the language that was adopted by this
    committee still left a real problem when you accept--if you go
    to section 15, I believe it is, and the new language still
    precludes material that would come off all kinds of federal
    lands--roadless areas, old growth, late successional stands--
    except for dead, severely damaged or badly infested trees.
    Those definitions, those were never defined. I had Forest
    Service employees ask me what is a severely damaged tree, what
    is a badly infested tree, because they said we are the ones who
    are going to get sued because--and so it still is not workable
    language in the real forest.
        Mr. Waxman. We thought we had corrected the problem. I just
    wanted to make that point.
        Mr. Whitfield. Ms. Jackson, maybe we will have you back and
    we will talk about woody biomass in detail, at length.
        This time I will recognize Ms. Capps of California.
        Ms. Capps. Thank you. Before I get to my questions, I ask
    unanimous consent to place into the record a letter, and it is
    signed by more than 1,800 physicians, nurses and other health
    professionals from all 50 States calling upon Congress to, and
    I quote, ``resist any efforts to weaken, delay or block
    progress toward a healthier future for all Americans.''
        Mr. Whitfield. Without objection.
        [The information appears at the conclusion of the hearing.]
        Ms. Capps. Thank you. I also ask unanimous consent to place
    into the record statements from a number of public health
    organizations including the American Lung Association and the
    Trust for Americans' Health rejecting the draft bill under
    consideration today.
        Mr. Whitfield. Without objection.
        [The information appears at the conclusion of the hearing.]
        Ms. Capps. Thank you, Mr. Chairman.
        Administrator Jackson, thank you for your testimony and for
    your patience this morning. I want to talk about the very real
    consequences for our public health, and you know my background
    as a public health nurse, if we do not act to control
    greenhouse gas emissions. One of the best documented impacts of
    climate change is the in ground-level ozone smog
    concentrations. This is a big problem for many of our
    metropolitan and suburban areas. Now, I know you were asked
    about and already talked about some of the harmful effects of
    this carbon pollution on people but can you be more specific or
    give some examples, if you will, from your data collection on
    kids' respiratory health being impacted, the cases of asthma or
    heart problems or cancers?
        Ms. Jackson. EPA's work under the Clean Air Act to address
    smog is directed primarily at reducing ground-level ozone,
    which we know, which science does not dispute, increases the
    risk of asthma attack and premature death for people who have
    lung disease.
        Ms. Capps. Thank you. I know in my years of being a school
    nurse, we saw a dramatic increase in the number of children
    with asthma, which is the case today as well.
        Two years ago when you issued the endangerment finding, you
    considered these effects on human health. They were a part of
    your decision-making process, right?
        Ms. Jackson. Absolutely. The unchecked emissions of
    greenhouse gas emissions would change the climate, thus
    exacerbating the effects of smog on asthmatic children and
    people with lung disease.
        Ms. Capps. Can you please also share with this subcommittee
    some of the other public health research and science that you
    reviewed in making this decision? I know that it was an
    extensive and thorough decision-making process in which you
    didn't ask a few selectively chosen groups, that you went
    broad-based. Maybe we need to know how broad-based your
    research was.
        Ms. Jackson. Yes, it was based on the peer-reviewed work of
    multiple research programs, both public research as well as
    private and academic research. The U.S. Global Change Research
    Program, for example, projects that the impacts we would see in
    America from unchecked carbon dioxide and global warming
    pollution would be tremendous. They would not be limited to
    urban areas. They would not be limited to arid areas. The Great
    Plains would experience more drought and increased infestation
    of pests. That means more disease. The Southeast would
    experience declines in livestock production. The Great Lakes
    would have more frequent spring flooding and more frequent
    drought. That's in addition to the more traditional public
    health impacts to people who oftentimes are least able to
    defend themselves: our children.
        Ms. Capps. Exactly. And, you know, we have heard today
    about the costs of implementation of the EPA and your
    endangerment findings and all the rest, but I have been able to
    make the case, and I wonder if you wouldn't agree, that the
    benefits of the programs that you have implemented really do
    exceed and add greatly to balance over the costs of
    implementation, far and away.
        Ms. Jackson. That is right. We are talking about the Clean
    Air Act today and history. Facts show numerous studies, 30 to
    one, 40 to one, the health benefits for every dollar invested
    in this country in clean air technology.
        Ms. Capps. And finally, as your agency continues to do the
    work that you are doing, you are going to be making decisions
    based on the best public health research and science, I am
    sure, and I just want to make sure that we have, because it is
    in the record now as I have introduced, one quote from the
    letter that these 1,800 health professionals submitted, and
    they say, ``As health and medical professionals, we are keenly
    aware of the health impacts of air pollution.'' Air pollution
    is linked to a wide range of health consequences including
    cancer, asthma attacks, heart attacks and strokes. The Clean
    Air Act guarantees all Americans, especially those most
    vulnerable, that the air be safe and healthy to breathe.
    Despite air pollution reductions, more progress is needed to
    fulfill this promise, and maybe you will close it out with 3
    seconds illustrating that.
        Ms. Jackson. I don't know what better way to say it or from
    a more credible source. I like a recent quote I saw from a
    physician in the Missouri area who said it is just not
    conceivable that we wouldn't our require not to pollute our
    air, not to make our air dirtier and our families less healthy
    in order to increase their profit margins.
        Ms. Capps. Thank you. Thank you, Mr. Chairman. I yield
    back.
        Mr. Whitfield. Thank you. At this time I recognize the
    gentleman, Mr. Terry, 5 minutes.
        Mr. Terry. Thank you, Madam Administrator. Do you like
    puppies?
        Ms. Jackson. Do I like puppies?
        Mr. Terry. Yes.
        Ms. Jackson. Yes, as long as somebody trains them for me,
    but I have a dog.
        Mr. Terry. I just wanted to ask you because I felt like
    joining Mr. Waxman and Mr. Markey in asking you questions.
        Now, could you point to the area where in the Clean Air Act
    it lists--because I have looked at the Clean Air Act and it
    sets out rather lengthy lists of what is covered. So within the
    Clean Air Act, could you point to which section CO2
    is listed?
        Ms. Jackson. That determination was made by the Supreme
    Court, sir.
        Mr. Terry. OK. Let us go to Massachusetts v. EPA. And by
    the way, I want to refute, not refute, but Mr. Inslee read a
    portion of or a paragraph of the Court's decision,
    Massachusetts v. EPA, that recognizes the fact that--I just put
    CO2 into the air and I appreciate that the Supreme
    Court recognized that when I exhale or there is CO2
    emissions. I am not going to comment on any contribution by me
    of methane. That is humor, by the way, Ms. Jackson. Larry the
    Cable Guy is from Nebraska so we have a certain level of humor.
        But here is a compelling part or part of the Massachusetts
    v. EPA that is really the subject of the debate over this issue
    of whether or not the EPA has the power to do this, and I am
    going to read the full paragraph like Mr. Inslee did. It is in
    the order part, and it just says, ``In short, EPA has offered
    no reasoned explanation in its refusal to decide whether
    greenhouse gases cause or contribute to climate change. Its
    action was therefore arbitrary, capricious or otherwise not in
    accordance with law. We need not and do not reach the question
    whether on remand EPA must make an endangerment finding or
    whether the policy concerns can inform EPA's actions in the
    event that it makes such a finding. We only hold that EPA must
    ground its reasons for actions or inaction in the statute.''
        The issue here is whether or not this Administration is
    grabbing power without congressional approval, and I would
    submit to you that the language in Massachusetts v. EPA does
    not say that the EPA has the power to start regulating
    CO2. Science and issues, as Mr. Sullivan from
    Oklahoma, where all evil oil men evidently reside, made the
    point, this isn't a debate about science, this is a debate
    about whether the EPA has authority. Next week we are going to
    do the same thing with the FCC on whether they have
    unilaterally sua sponte performed a power grab without
    congressional authority. So that is what we are here to do
    today. And then I want to get to the Clean Air Act. If the
    Clean Air Act was amended and just added carbon dioxide to the
    section that lists all the pollutants specifically, isn't it--
    well, then would you be able to say well, we are only going to
    apply CO2 if there is more than 100,000 tons emitted
    within a calendar year? Would you be able to do that?
        Ms. Jackson. Sir, are you asking about a potential change
    to section 111 of the Clean Air Act?
        Mr. Terry. Well, I will have to look at 111, but the issue
    is that you said earlier in your testimony that the emissions
    that you would regulate would be for CO2 would be
    over 100,000. You said that in answering Mr. Whitfield's
    question.
        Ms. Jackson. Pursuant to the standards under the tailoring
    rule that we----
        Mr. Terry. Under the tailoring rule, but when reading the
    Clean Air Act under what triggers it, it is either 100 or 250
    tons per year, 250 being cited exemptions of which
    CO2 is not or its type of industry, so let us say
    coal industry.
        Ms. Jackson. Right. So the United States Supreme Court,
    whose job it is under the Constitution to interpret our laws,
    ruled on whether or not EPA could ignore its need to make a
    finding----
        Mr. Terry. OK. So since you are saying that the EPA has
    already ignored that Congress didn't give you the authority and
    now you are interpreting they did, that you can just continue
    to interpret----
        Ms. Jackson. I am not interpreting. The United States
    Supreme Court----
        Mr. Terry [continuing]. Different sections saying that
    you----
        Ms. Jackson [continuing]. Ruled that----
        Mr. Terry [continuing]. Are going to redo the standards
    where you are able to regulate, i.e., 100 or 250, and you can
    arbitrarily set it at 100,000 for a coal-fired plant, correct?
        Ms. Jackson. Sir, in an attempt to ensure that we----
        Mr. Terry. OK. You are not going to answer the question.
        Ms. Jackson [continuing]. Minimize the number of----
        Mr. Terry. Thank you for your testimony.
        Ms. Jackson [continuing]. Sources that were regulated, we
    have proposed and summarily adopted after public comment a rule
    that is intended to ensure that only the very largest sources--
    --
        Mr. Terry. Madam Administrator, the Clean Air Act does not
    give you that authority.
        Ms. Jackson. The United States Supreme Court says it does.
        Mr. Whitfield. I recognize the gentleman from Texas, Mr.
    Green, 5 minutes.
        Mr. Green. Thank you, Mr. Chairman.
        Welcome, Madam Administrator. I know there is an image here
    that there are only oilmen in Oklahoma. We have a couple in
    Texas and Louisiana and Alabama and Alaska and other places in
    our country.
        My first question was talking about new source performance
    standards, and you have answered that. I guess my concern is
    that there was a consent decree signed but there was no
    economic analysis except during the rulemaking process. It
    seems like we ought to look at that ahead of the rulemaking,
    but I know you have already answered that question.
        My question, though, concerns what happens if only the
    United States acts to reduce these emissions while major
    emitters like China or India, and China may overtake us if they
    haven't already, do not follow suit? Can we really address
    climate change without strong mandatory reductions by other
    major emitters in other countries?
        Ms. Jackson. We will not ultimately be able to change the
    amount of CO2 that is accumulating in the atmosphere
    alone, but that does not mean we should all start at the exact
    same time.
        Mr. Green. I am concerned that the regulations put our
    smaller manufacturers' plants and refineries at an economic
    disadvantage compared to similar industries overseas, a
    disadvantage that several of our witnesses later on will
    outline, and what specifically can your agency do to address
    the concerns of these smaller facilities?
        Ms. Jackson. Well, the tailoring rule which I just
    mentioned was intended to give certainty that those facilities
    would not be subject to regulation. We are talking about
    facilities that emit more than 100,000 tons of CO2
    or its equivalent per year. You get that by burning over a
    railroad car of coal every single day. That is how large these
    facilities are. It was intended to be a reasonable first step,
    to start with the large sources, not with the small ones, and
    to rely heavily on energy efficiency because the belief was
    that if we are going to invest and make ourselves more
    competitive, making ourselves more energy efficient will help
    our bottom line and put more money in the economy for us to
    spend on something besides oil, especially foreign oil, of
    course.
        Mr. Green. Well, I have to admit the hearing today is on
    potential legislation that would actually remove the EPA's
    authority. I think we have to address carbon in our country. I
    just prefer it to be on the legislative level. And we made an
    effort last Congress. We know cap and trade didn't pass during
    a Democrat Congress so it is not going to pass during a
    Republican Congress. But I would like to see Congress take that
    effort and maybe EPA doing it will push us.
        Would you agree that with the measures your agency is
    undertaking in an attempt to curb greenhouse gases, it will
    still be necessary to increase environmentally responsible
    production of domestic natural gas supplies to meet the short-
    term carbon reduction goals and keep these manufacturing jobs
    in the United States? Is natural gas part of the solution to
    carbon?
        Ms. Jackson. Natural gas is much less carbon-intense than
    some other forms of fossil fuels, particularly coal, which is
    used for baseload electricity generation in this country. So it
    can certainly be a help, a very useful step in the right
    direction.
        Mr. Green. Well, and I have said it before and I think this
    is something we can agree on across party lines, is that the
    other side is nuclear power. Our country compared to both
    France and Japan is so far behind in utilizing nuclear power,
    but as we know, nuclear power has no carbon emissions except
    for the construction. But natural gas emits 30 percent less
    carbon dioxide than oil does. For our New Englanders who still
    use fuel oil to heat their homes, maybe they need to put a
    pipeline there for the natural gas. But it is 50 percent less
    than coal. So I would hope this Congress would look at
    empowering cleaner burning fuels including the substantial
    expansion of nuclear. We are struggling, as you know, to get
    loan guarantees that were passed in the 2005 energy bill for
    the expansion of nuclear power in our country, yet here we are
    in 2011 and we still don't have it.
        So I share your concern about carbon. I just am concerned
    that we need to do it in a legislative effort so we can do that
    economic analysis from the members, elected members instead of
    the agency.
        With that, Mr. Chairman, I yield back my time.
        Mr. Whitfield. I recognize the gentleman from Texas, Mr.
    Burgess, 5 minutes.
        Dr. Burgess. Thank you, Mr. Chairman.
        Thank you, Administrator Jackson, for being here. I am
    going to ask you a series of, I think, six questions. They are
    detailed and complicated and I know they are going to require
    answers in writing. Some of these I submitted to you before. We
    are still awaiting answers. So what I am interested in this
    morning is getting affirmation that some type of response will
    be coming from your office on these issues.
        Now, north Texas, where I live, last week, a week ago
    today, we were subject to rolling blackouts of electrical
    power. Businesses, schools, hospitals were all affected. This
    was not because of tree branches weighted down by the ice and
    cutting power lines. This was simply an effect of the very cold
    temperatures that were in place in Texas last week. We do all
    recognize there are new regulations coming down the pike, and
    can you assure us here at the subcommittee that these rules
    will not make instances of rolling blackouts more common? We
    would also be interested in the studies that are underway to
    look at the cumulative effect of all of the EPA regulations on
    electrical reliability, not just in Texas where we have our own
    reliability council, but across the country.
        A second area. Did the EPA consult with anyone at Office of
    Management and Budget or the White House before moving forward
    in taking over the Texas flexible permitting program under the
    Clean Air Act? The EPA is now issuing its own permits to
    utilities in Texas, displacing the State agencies that have
    been responsible for that historically, the first time to my
    knowledge that the EPA has taken over a State system. And did
    the EPA consult with Office of Management and Budget on
    regulations for the permits it is issuing in lieu of the State-
    based permits? And I would be interested in your development of
    that answer in light of President Obama's recent Executive
    Order calling for greater scrutiny of regulations and
    streamlining of problems encountered with bureaucracy so areas
    where you and the EPA have identified regulations for
    streamlining. I would like to have your thoughts on that.
        Gene Green mentioned natural gas. It is a big industry. In
    my part of Texas, there is of course some controversy over the
    production of natural gas and there are issues that are being
    worked out at the federal, State and local level. Still your
    administrator in region 6 has made public statements that he is
    going to be much more actively involved in the regulation of
    this industry. It employs 100,000 in my area of north Texas. So
    my question that I would like for you to provide some insight
    is, are there active discussions within the EPA to take over--
    we are talking about the Clean Air Act today but this could
    also involve the Clean Water Act. Is there going to be greater
    involvement at the federal level in these activities and how
    are you going to justify that with the President's call for
    greater streamlining of burdensome regulations?
        The ethanol mandate that was accelerated in December of
    2007--E15 is now, we are told, going to be mandated by the EPA,
    15 percent ethanol. Can you provide us with the testing that
    has been done in both vehicles and small engines utilizing 15
    percent ethanol? Can you provide us with information on the
    testing done to date and the testing methodology that was
    employed? And again, I am particularly interested in older
    engines, cars produced between 2001 and 2007, and the small
    engine--the snow blower, the weed eater and that type of
    activity.
        Under Title 42 of the United States Code, the section for
    the Department of Health and Human Services, it does allow for
    increased salaries for limited positions requiring specialized
    expertise, and I get that and that is not necessarily a bad
    thing, but it appears that EPA is also utilizing some of those
    42 exemptions. Can you provide for the committee how many EPA
    employees are receiving pay under Title 42 exceptions? Have you
    placed a limit of pay under Title 42 and what is the total
    amount of the Title 42 program costing the federal taxpayer
    within the Environmental Protection Agency's budget?
        Now, this last question, perhaps you can address this while
    we are here today. The Business Roundtable in June of this year
    under the President's request submitted to the President some
    issues that they thought might help in job creation because
    this was an issue last June that the President was concerned
    about, and the Roundtable specifically mentioned the
    Environmental Protection Agency's moves against Texas flexible
    permitting program as one of the major examples of the
    Administration's hostility--their words--towards growth. So 6
    months, what has your office, Office of Management and Budget,
    the White House done in response to the Business Roundtable's
    suggestion to remove the EPA's restrictions on the Texas
    flexible permitting program?
        Ms. Jackson. Sir, I will answer all the other questions in
    writing for the record, and I am happy to do that. I just want
    to point out one important fact. It was the Bush EPA, the Bush
    Administration that found out that under the Clean Air Act the
    Texas flexible permitting program was not legal. So when I
    became Administrator, I found a situation where businesses in
    Texas have no certainty that the permits they have protect them
    from lawsuits for emitting excessive pollution. We have worked
    individually with businesses in Texas to bring their permits
    into compliance with the law and that process will take some
    amount of time. But the answer certainly could not have been to
    look the other way as these businesses got permits that weren't
    worth the paper they were printed on.
        Dr. Burgess. If I may point out in the Business Roundtable
    report prepared for the President, similar rules exist in other
    States which have not been challenged by the EPA. This appears
    to be Texas specific, and if it is, that is wrong and I would
    like you to look into it, and I will await your answers. Thank
    you.
        Mr. Whitfield. At this time I recognize Mr. Engel from New
    York for 5 minutes.
        Mr. Engel. Thank you very much, Mr. Chairman.
        As my colleagues have discussed, this legislation would
    repeal EPA's scientific determination that greenhouse gases
    threaten public health and welfare, known as the endangerment
    finding. I happen to believe that carbon emissions are a
    serious threat to our Nation's welfare. I mean, I know that
    some of us might wish that the earth is flat, and I understand
    that different districts have different needs, I understand my
    colleagues trying to protect industry in their districts, but
    the bottom line is, this is scientific research. This is
    proven, and we have decisions and we are supposed to abide by
    them.
        Ms. Jackson, let me first of all thank you for the
    excellent job that you are doing, and your testimony here this
    morning has just affirmed in my mind what a grasp you have of
    the issues, how determined you are to be on the right track,
    and I just want to thank you for your good work.
        Legislatively repealing that scientific determination
    directly conflicts with the consensus of climate scientists,
    including President Bush's EPA Administrator, Stephen Johnson,
    and the world's most authoritative scientific organizations
    which use words like ``indisputable'' and ``unequivocal.'' We
    talk about it killing jobs. Well, this is an interesting
    statistic. Since its adoption, the Clean Air Act has reduced
    key air pollutants by 60 percent while at the same time the
    economy grew by over 200 percent. So I don't think that that
    shows that jobs are being killed. From 1990 to 2008 alone, the
    Clean Air Act reduced key air pollutants by over 400 percent,
    and the economy grew by almost 65 percent. These pollution
    reductions save lives, improve health, particularly among
    children and seniors, and in 2010 alone, last year, according
    to a peer-reviewed EPA analysis, the Clean Air Act prevented
    over 160,000 premature deaths, 130,000 cases of heart disease,
    1.7 million asthma attacks, 86,000 hospital admissions and
    millions of respiratory illnesses. So I wanted just to state
    that for the record.
        I would like to explore with you, Madam Administrator, one
    question on the impacts of this legislation on the renewable
    fuel standard. As you know, in order to promote renewable fuels
    and reduce greenhouse gas pollution, Congress has required EPA
    to issue regulations to ensure that transportation fuels sold
    in the United States contain certain volumes of renewable fuel:
    advanced biofuel, cellulosic biofuel and biomass-based diesel.
    The volume of each type of fuel is established annually by the
    EPA and based in part of the availability of the fuel. Now, it
    appears to me that the new section 330(b)(1)(A) would prevent
    the EPA from establishing these required annual volumes in
    subsequent years because it prohibits EPA from taking actions
    related to greenhouse gases. Do you have the same
    interpretation that I do of section 330(b)1)(A), and if so,
    what do you think that means for the renewable fuel standards
    specifically and the future of biofuels generally in the United
    States?
        Ms. Jackson. Sir, as I said in my opening statement, I
    believe the draft bill would likely prohibit EPA from taking
    further actions to implement the renewable fuels program in the
    United States.
        Mr. Engel. Well, I think that that is something that is
    really, really important and we really need to think twice
    before we want to do such a thing. I mean, I think that nobody
    at this point should conclude that carbon emissions are not a
    serious threat to our Nation. I mean, they are, and we ought to
    not put our heads in the sand. We ought to figure out a way
    where we can have cleaner air and at the same time have the
    least impact on business and creation of jobs but we shouldn't
    eliminate all these restrictions just because we are concerned
    about these things with jobs. We don't want our children to
    breathe filthy air. We don't want it to go back to the bad old
    days. There are countries all around the world where literally
    people, the cancer rates are up because they don't have the
    rules that we have adopted to prevent these things, and I don't
    think we want to go back to the Stone Age.
        So I thank you for your testimony, and I look forward
    continuing to work with you, and I yield back, Mr. Chairman.
    Thank you, Mr. Chairman.
        Mr. Whitfield. A number of people have mentioned this
    renewable fuels issue, and as we move forward with this
    legislation, we are certainly going to try to address some of
    the concerns that you all have brought about it.
        At this time I recognize the gentleman from Louisiana, Mr.
    Scalise, for 5 minutes.
        Mr. Scalise. Thank you, Mr. Chairman, and welcome back, Ms.
    Jackson.
        Ms. Jackson. Thank you.
        Mr. Scalise. I appreciate you coming to testify. And of
    course, today's hearing is specifically focused on the Energy
    Tax Prevention Act and especially its impact on jobs and how if
    we are able to prevent, truly prevent your agency from going
    into an area where it hadn't been before, we would also be able
    to save thousands of American jobs, potentially millions of
    American jobs along with billions of investment.
        First I want to go back to some comments and statements
    that the President made when he was a candidate. President
    Obama on multiple occasions has talked about cap and trade and
    this kind of regulatory scheme increasing the cost of
    electricity, and I will read one of his quotes. ``Under my plan
    of a cap-and-trade system, electricity rates would necessarily
    skyrocket.'' That was then-Senator Obama as a candidate for
    president. Do you agree with that statement?
        Ms. Jackson. No, sir. I think that statement is----
        Mr. Scalise. You disagree with the President's statement
    that a cap-and-trade scheme would necessarily----
        Ms. Jackson. I believe his larger point was that a market-
    based program could ensure that energy rates while producers
    had the certainty they needed to move forward, the market
    through innovation would allow it to happen in a gradual
    fashion.
        Mr. Scalise. A gradual fashion where electricity rates
    skyrocketed, though. That is the key point. The President said
    this. I am not saying this. I will give you Tim Geithner's
    statement. Tim Geithner said cap and trade would increase the
    cost of energy. Do you agree with that statement? Yes or no.
        Ms. Jackson. Controlling pollution is not free.
        Mr. Scalise. It is a yes or no question. Tim Geithner made
    the statement, President Obama made the statement.
        Ms. Jackson. Sir, I don't know what cap and trade you are
    asking me to speculate about. We are here to talk about the
    Clean Air Act and----
        Mr. Scalise. We are talking about the regulatory scheme
    that your agency is currently undergoing that is costing jobs--
    --
        Ms. Jackson. No, that is not true. There is no cap-and-
    trade scheme----
        Mr. Scalise [continuing]. And the effects it would have on
    electricity rates.
        Ms. Jackson [continuing]. Planned or provided----
        Mr. Scalise. Do you think that this wouldn't have----
        Ms. Jackson [continuing]. For in the Clean Air Act.
        Mr. Scalise [continuing]. Any impact on electricity rates?
        Ms. Jackson. There is no cap-and-trade scheme provided for
    under the Clean Air Act----
        Mr. Scalise. Your regulatory scheme for greenhouse gases--
    --
        Ms. Jackson [continuing]. For greenhouse gases, I should
    say.
        Mr. Scalise [continuing]. Which your agency is currently
    doing. Are you currently doing this?
        Ms. Jackson. What we are doing is----
        Mr. Scalise. Yes or no.
        Ms. Jackson [continuing]. Enforcing the Clean Air Act----
        Mr. Scalise. I hate to put you on the spot. I know Mr.
    Dingell----
        Ms. Jackson [continuing]. To reduce the emissions----
        Mr. Scalise [continuing]. Got a lot of good yes or no
    answers.
        Ms. Jackson [continuing]. Of greenhouse gases.
        Mr. Scalise. I would appreciate the same courtesy to a yes
    or no question.
        Ms. Jackson. Well, no, if you are asking me about cap and
    trade for greenhouse gases because there are no plans for cap
    and trade at EPA, and there are no plans----
        Mr. Scalise. So is it safe to say you disagree with the
    President when the President said when cap and trade would
    increase, skyrocket the cost of electricity?
        Ms. Jackson. Sir, what I do know is that we are not
    planning any cap-and-trade regulations or standards. That is
    not----
        Mr. Scalise. We both have limited time, and I appreciate
    that maybe you want to evade the question. It is a direct
    question. It is a pretty simple question that many in this
    Administration have been comfortable acknowledging. Many in
    business have acknowledged that this would increase the cost on
    families. It seems like for whatever reason you don't want to
    acknowledge it, but if you then go to the next step of
    regulating greenhouse gases, do you think that if you regulate
    greenhouse gases in your agency that it would cost jobs?
        Ms. Jackson. I agree with the President that investing in
    clean energy will make our economy stronger, will help our
    economy----
        Mr. Scalise. And I see you have made statements these
    standards will help American companies and create good jobs.
    The problem is, that flies in the face of what the Nation's
    employers in America are saying about what you are doing, and I
    don't know if there is a parallel universe going on but I will
    point to you a number of companies, and I have conversations as
    I am sure most of my colleagues do. The biggest impediment our
    job creators in this country tell us about is the threat of
    regulations coming from your agency and a few other agencies in
    this Administration as the impediments to creating jobs. So
    maybe you think that these policies will help create jobs.
        I will just read what one of our later panelists is talking
    about in terms of how it is costing American jobs. Nucor, which
    is a plant, a company based in America that is preparing to
    build a major steel plant in Louisiana, in our State, the CEO
    of that company--that is a $2 billion investment that right now
    is going to America hopefully. It was on hold during the whole
    debate on cap and trade. They said, and this is a comment from
    the CEO, ``We are waiting to see what Congress does with global
    warming legislation.'' They were holding back on a $2 billion
    investment. And then I will go on to say what the testimony
    that the environmental manager of the company who is here today
    is talking about. He said, ``But this project is not as large
    as the $2 billion investment we initially intended due to the
    uncertainty created by these regulations.'' He is talking about
    your department, the uncertainty created by these regulations.
    ``We made the difficult decision to delay the $2 billion
    investment also delaying the creation of 2,000 construction
    jobs and 500 permanent jobs that average $75,000 a year. Now,
    this is a company.
        Ms. Jackson. Sir, respectfully----
        Mr. Scalise. This isn't theory.
        Ms. Jackson [continuing]. Based on EPA----
        Mr. Scalise. Do you recognize that----
        Ms. Jackson [continuing]. The proposed Nucor iron and steel
    facility in Louisiana has actually received the first-ever
    State-issued Clean Air Act construction permits----
        Mr. Scalise. Do you recognize that that costs jobs?
        Ms. Jackson [continuing]. That will require control for
    greenhouse gases. They are a permitted facility----
        Mr. Scalise. And they said they haven't created as many
    jobs----
        Ms. Jackson [continuing]. For greenhouse gases, so that
    would seem to be----
        Mr. Scalise [continuing]. Because of your agency, and I
    just want to talk about that.
        Ms. Jackson [continuing]. Exactly the opposite of them
    being held up. They have----
        Mr. Scalise. But finally, you made a statement about
    Katrina and flooding. You tried, to I guess, infer that
    flooding----
        Mr. Waxman. Point of order, Mr. Chairman.
        Mr. Scalise [continuing]. Was related to----
        Mr. Waxman. Point of order, Mr. Chairman.
        Mr. Scalise [continuing]. Greenhouse gases.
        Mr. Waxman. Point of order.
        Mr. Scalise. I just want to point out the failure of the--
    --
        Mr. Waxman. Point of order, Mr. Chairman.
        Mr. Whitfield. Hold on just one minute. OK, Mr. Waxman, you
    had a point of order.
        Mr. Waxman. Look, she was asked a question. The gentleman's
    time has expired. She ought to be able to answer it.
        Mr. Scalise. I asked her to answer yes or no, and she
    refused to answer a yes or no question multiple times.
        Mr. Whitfield. I think that----
        Mr. Scalise. She did it for Mr. Dingell. I appreciate that.
    I just would like the same courtesy.
        Mr. Whitfield. Are you going to have any questions that you
    are going to submit to her in writing?
        Mr. Scalise. I will be happy to submit in writing the
    remaining questions, especially as it relates to the comment
    you made about flooding having an attribution to greenhouse
    gases as opposed to the federal levies in New Orleans, which I
    know you are aware was the real cause of flooding.
        Ms. Jackson. Let me be clear because this is my hometown. I
    did not say that Katrina was due to greenhouse gas emissions.
        Mr. Whitfield. OK. At this time I recognize----
        Mr. Scalise. Thank you.
        Ms. Jackson. I said it was horrible flooding----
        Mr. Whitfield [continuing]. Mr. Doyle for 5 minutes.
        Ms. Jackson [continuing]. Impacted that area in a way that
    is tragic.
        Mr. Whitfield. Mr. Doyle, 5 minutes.
        Mr. Doyle. Thank you, Mr. Chairman.
        Administrator Jackson, welcome, and thank you for your
    patience today. As most members of this committee know, I have
    long been concerned about manmade climate change and how it
    affects our climate, but this committee also knows how
    concerned I am that as we make efforts to address this serious
    problem that we don't harm the competitiveness of American
    industry. During the comprehensive energy legislation that the
    House considered and passed last year, I introduced amendments
    to safeguard many of our industries from some of the effects of
    the bill because we are concerned that this not result in jobs
    being shipped overseas, and if I thought that was what was
    going to happen, I would be very concerned too.
        You know, initially many of us were concerned because the
    Clean Air Act had the potential to require numerous sources to
    obtain permits for greenhouse gas emissions, but EPA acted
    promptly and effectively to issue a tailoring rule and limit
    these requirements only to the largest sources. Administrator
    Jackson, could you just briefly explain what that tailoring
    rule did?
        Ms. Jackson. The potential universe of sources could have
    been 6 million. The tailoring rule took it down to a universe
    no larger than about 15,000 potential, but since you are only
    regulated if you are building a new facility or substantially
    increasing your emissions, we expect that there are a couple
    hundred additional permits that would be required a year, but
    that was intended to be a deregulatory action.
        Mr. Doyle. So does this rule affect every large facility?
        Ms. Jackson. It will only affect very, very large
    facilities, those that emit more than 100,000 tons a year and
    only if they are new, or 75,000 tons a year if they are going
    to have a significant increase in their greenhouse gas
    emissions.
        Mr. Doyle. So right now if you are an existing factory or
    steel mill and you don't expand or increase your greenhouse gas
    emissions by a significant amount, you don't need to spend any
    capital or labor on controlling your greenhouse gas emissions.
    Is that correct?
        Ms. Jackson. That is right, sir.
        Mr. Doyle. So let us say a steel company or other
    manufacturer does want to build out on an existing facility or
    bring an entirely new one online. What do they actually have to
    do? Have you issued guidance on this to let sources know the
    rules of the road?
        Ms. Jackson. Yes, we have issued that guidance, primarily
    for States, who are the permitting authorities, and they are
    implementing it. As you heard, Louisiana just recently
    implemented it to issue a permit there.
        Mr. Doyle. So the permitting authority then basically
    selects the best available control technology through whatever
    options there are. Is it your statement that I heard earlier
    that in most cases the best available technology for reducing
    greenhouse gas emissions is likely to be efficiency?
        Ms. Jackson. That is right.
        Mr. Doyle. So to be clear, you expect that almost all new
    sources, the main thing they are going to have to do is just
    become more energy efficient?
        Ms. Jackson. That is right.
        Mr. Doyle. So couldn't that actually save money over time
    as sources have fewer inputs and reduce their energy use?
        Ms. Jackson. Absolutely. It could increase the profits
    because you costs are lower going forward.
        Mr. Doyle. Yes, I mean, it just seems to make sense to me
    that when we build new facilities, they should be efficient,
    and I think that is something that industry is striving for
    because they realize it is good for their bottom line, and it
    certainly doesn't appear that it would be too costly or drive
    new facilities overseas.
        But the other concern we have is, what if it takes too long
    for new facilities to get permits? Now, that could have cost
    implications even if the requirements are reasonable. So
    Administrator Jackson, what is the EPA doing to help ensure
    that these requirements don't lead to permitting delays?
        Ms. Jackson. The reason we got the guidance out to the
    State permitting authorities earlier is so that there would be
    no time lapse between when these requirements took effect on
    January 2nd and when people would be applying for and need
    these permits, and so EPA is offering technical assistance and
    guidance to step in for those States, and there are several who
    for whatever set of rules or legal obligations back home are
    not yet ready to implement the permitting requirements for
    greenhouse gases. But almost all States are moving in that
    direction. Many have already gotten to that point.
        Mr. Doyle. Now, the Upton bill here aims to stop you from
    issuing minimum standards for the two largest sources of
    greenhouse gas emissions, fossil fuel-powered plants and oil
    refineries. Is EPA currently developing minimum standards for
    any other sectors of the economy such as manufacturers?
        Ms. Jackson. No, sir.
        Mr. Doyle. OK. Thank you, Administrator Jackson. I am
    acutely aware of the challenges that our manufacturers are
    facing today, and I have to tell you that I was skeptical at
    first when investigating how this Clean Air Act would be used
    to regulate greenhouse gases, but it seems to me that when you
    strip away the rhetoric and the scare attacks that the approach
    and the scare tactics that the approach that you are taking to
    date seems extremely reasonable. We know our manufacturers are
    facing tough challenges but I really don't see how repealing
    the Clean Air Act authority for greenhouse gases would help
    them in any way. In fact, the legal uncertainties actually make
    things a little bit worse.
        Mr. Chairman----
        Mr. Markey. Would the gentleman yield briefly?
        Mr. Doyle. Well, if I can, I will.
        Mr. Whitfield. His time is expired and we have a lot of
    witnesses, so Mr. Olson from Texas, you are recognized for 5
    minutes.
        Mr. Olson. Thank you, Mr. Chairman, and thank you,
    Administrator Jackson, for coming here today. I am going to
    follow up on some questions from my colleague, Mr. Burgess from
    Texas, about EPA's taking control of the permitting process for
    refineries and power sources in my home State of Texas. This is
    a fundamental change. The feds under the Clean Air Act, the
    feds set the standards and the States and local governments are
    the ones who implement them through the SIPs, and to justify
    this change, EPA says it erred in the original approval of the
    SIP back in 1992, nearly 2 decades ago, three Presidential
    Administrations because the SIP didn't contain the authority to
    regulate greenhouse gases, and that must be corrected. The
    mechanism to establish this correction was unilateral EPA
    authority to correct ``minor technical errors.'' The feds'
    takeover of States' authority to issue permits under the Clean
    Air Act is not a minor error. It is a radical departure from
    existing law, and under the Constitution that is not your job.
    That is our job.
        So the first question I have for you is twofold. Has any
    previous Administration used an error correction to overturn
    State authority to implement its SIP after it has been approved
    for 18 years?
        Ms. Jackson. Sir, I am happy to get you an answer, but
    again, I will point out that it was the previous Administration
    that determined that parts of Texas's permit rules did not meet
    the requirements of the Clean Air Act. It is EPA's job to
    enforce the Clean Air Act and EPA stepped in because if we
    didn't, Texas businesses would not be able to build or expand
    because they could not get a greenhouse gas emission permit in
    the State of Texas that was legal so they would have been
    subject to any number of lawsuits.
        Mr. Olson. Yes, ma'am, but the previous Administration did
    come in with a couple of month deadline for the Texas companies
    to comply. Usually this happens when there is a change in the
    SIP. As I understand it, there is about a 3- to 4-, 5-year
    process for the States to come through and propose what they
    are going to do to EPA. We are given less than a year, less
    than 6 months to do it, and that is something that is on this
    Administration. Is that----
        Ms. Jackson. We would prefer that Texas issue the
    greenhouse gas permits themselves but if Texas refuses to do
    it, as I am sure you will hear from the next witness, then EPA
    is stepping in to do so because the businesses in Texas still
    need permits under the Clean Air Act, sir.
        Mr. Olson. Once again, how is changing the Clean Air Act
    with just using the technical corrections legislation, how is
    that not usurping the legislative branch's authority to pass
    laws and regulate our environment? I mean, why do you get to
    be--under the Constitution, we should be doing that, not the
    EPA. How can you justify that?
        Ms. Jackson. Sir, under the Clean Air Act, EPA's job is to
    enforce the law and ensure that permits are the same all over
    the country, so a business in Texas gets a Clean Air Act
    permit, it is the same as Louisiana next door, and so what EPA
    has done is move in to ensure that just like the Nucor steel
    facility just got a permit from the State of Louisiana, if they
    wanted to build the exact same facility in Texas, they would
    need a permit for greenhouse gases and they cannot get one
    because Texas has refused to consider those permits at this
    time.
        Mr. Olson. Yes, ma'am. Well, there is one other question I
    have for you. Again, we have talked about what is happening in
    my home State and we have talked about, the other side of the
    aisle has been very vocal about scientifically based actions
    here, and I agree with that. We should do this if we are going
    to do it scientifically based. I think the science right now is
    very much in doubt. But the one thing that I am really
    concerned about from the other side of the aisle, at the end of
    the day the argument rests on what five Supreme Court justices
    decided, and that case did not say that you had to regulate
    greenhouse gases. That was not what the decision said. I will
    read from the decision. The Court did find that EPA has the
    authority to regulate carbon dioxide as an air pollutant but
    they said only if the EPA makes a finding of endangerment under
    that provision, section 202(a)(1). And the Court further stated
    that EPA must ground its reasons for action or inaction in the
    statute. So basically they gave you the ball. I guess my
    question to you is, was Massachusetts v. EPA a mandate for the
    EPA to implement global greenhouse gas control or not? Yes or
    no.
        Ms. Jackson. Sir, it was a mandate that we consider the
    science, and that only if we could come up with reasonable
    science, which I do not believe exists, that shows that
    greenhouse gases do not endanger public health and welfare,
    could we ignore it. They said it was arbitrary and capricious
    to simply ignore the science and choose to make no decision. So
    it did give us the ball in that it said we could not stick our
    heads in the sand. We had to, per the law, make a
    determination, and in making that determination, I reviewed our
    Nation's best science by its best scientists and made a finding
    of endangerment.
        Mr. Olson. Basically you have taken something else. It was
    EPA that made that decision, not the Court, and those comments
    here are erroneous. EPA did it, not the United States Supreme
    Court. Thank you for your time.
        Mr. Whitfield. The gentleman from Utah, Mr. Matheson, is
    recognized for 5 minutes.
        Mr. Matheson. Thank you, Mr. Chairman. Thank you,
    Administrator Jackson, for coming today.
        I do think it is important that this subcommittee hold
    hearings on this issue. I think the challenge of climate change
    is real and I think that the legislative branch ought to be
    engaged. I have some concerns about legislation like Chairman
    Upton's draft bill which does disprove the EPA's endangerment
    finding and bans the EPA from regulation greenhouse gas
    emissions. I am concerned because I think it could
    substantially weaken the effectiveness of the Clean Air Act,
    and I think everyone in this room would argue that the Clean
    Air Act over the last few decades has been an undeniable
    success. It has been a success in providing cleaner air and
    contributing to public health interests.
        I also have concerns that the bill overrides the ability of
    the EPA to regulate emissions from motor vehicles, weaken the
    current fuel economy standards for cars and light trucks, which
    is important to reducing our dependence on foreign oil. But I
    do hear from folks in my State who are concerned about the
    implementation of the greenhouse gas regulations and other
    regulations coming down the pike from EPA and the potential
    costs associated with this uncertainty and growing regulatory
    burden, especially as we seek to grow our economy out of this
    economic recession.
        Administrator Jackson, I have heard from our State
    department of environmental quality, and I know you discussed
    this in response to Mr. Doyle's questions, but the Utah DEQ has
    said that despite the best available control technology
    guidance issued to the States last fall, there remains a lot of
    uncertainty over what BACT decisions by States will ultimately
    be accepted by the EPA. In particular, I have been told that
    the BACT is still too vague to provide any certainty to sources
    who are trying to plan for new construction or modifications.
    In his testimony, Mr. Carter with Sandy Cooper also made
    similar remarks. Can you elaborate on how EPA is working with
    States to implement best available control technology?
        Ms. Jackson. Certainly, sir. Through our regional offices,
    we are offering technical assistance as States work through
    permit by permit. This is a permit-by-permit decision under the
    Clean Air Act, and essentially what you do is, you lay out the
    options for controlling greenhouse gases and you look at
    whether they are commercially available, whether they are
    available at reasonable cost and whether they are effective,
    and oftentimes we believe that is going to lead people straight
    to energy efficiency, which is a very much available way and
    certainly cost-effective way to reduce and make a real start on
    reducing greenhouse gases.
        Mr. Matheson. Do you think there is a way to create
    additional certainty or predictability that you can provide to
    State permitting agencies?
        Ms. Jackson. We are certainly happy to try and to continue
    working with Utah and the professionals there.
        Mr. Matheson. Do you believe that your regional offices
    have the necessary resources, whether it is funding or staff,
    to work with the States on implementing these rules?
        Ms. Jackson. We have made it a priority that the
    implementation of these rules for our air staff is priority
    number one, and I do believe, sir, that we have resources
    available to any State that needs them.
        Mr. Matheson. Do you agree with assertions by many in
    industry and the utility sector that permitting uncertainty in
    conjunction with the additional EPA rules coming down the pike
    over the coming months and years is affecting current and
    future investments in plant modifications, upgrades and
    construction?
        Ms. Jackson. I agree that one thing I hear often from
    industry is that they need certainty of regulation. I think the
    clean cars rule and the nationwide standard is a great
    demonstration of how knowing what the road ahead looks like
    from a Clean Air Act perspective has helped them to move
    forward and do what they do best, which is make cars.
        Mr. Matheson. I will ask another question. The EPA has
    already announced the delay in implementation of efficiency
    rules for biomass facilities. Do you anticipate any delays in
    other covered sectors will be announced?
        Ms. Jackson. I have nothing to announce right now, sir. We
    are trying to do what I said, which is move in a series of
    moderate steps that give people lots of warnings so there are
    no surprises about regulations that may come down the pike, and
    what we have announced so far is that the only two sectors that
    we are looking at for additional standard setting are the power
    sector, utilities, and refineries because they account for such
    a large percentage of our Nation's greenhouse gas emissions.
        Mr. Matheson. OK. Thank you, Mr. Chairman. I will yield
    back.
        Mr. Whitfield. I recognize the gentleman from West
    Virginia, Mr. McKinley, for 5 minutes.
        Mr. McKinley. Thank you, Mr. Chairman.
        I am trying to keep most of my questions to yes or no
    answers to the extent you can, and I have got a lot of others
    if you could submit some responses back to those at the
    appropriate time. Last summer, Senator Reid made a remark that
    said coal makes us sick and oil makes us sick. Do you agree
    with that?
        Ms. Jackson. Only in that pollution makes us sick, so if
    they are the source of pollution, then yes, but it is the
    pollution that makes us sick.
        Mr. McKinley. I have heard a lot today about the health
    benefits, and I don't want to diminish those concerns about the
    health benefits, but I have come to Congress 34 days ago with a
    bigger concern that there are 15 million out of work today in
    America, and a lot of it is attributed back to the actions of
    the EPA and some of their activities or overregulation. I am
    seeing in West Virginia a mine shut down that had a permit 3
    years ago. Now 250-some people are out of work. I saw a mine
    just close in Pennsylvania by the EPA action. I have seen the
    issues of water quality in West Virginia and all other States
    east of the Mississippi that are more stringent than bottled
    water you can buy in a supermarket. I have seen fly ash being
    under attack and people using less of it and recycle. I am just
    so concerned that the EPA is, with all due respect, out of
    touch with what is going on in America, and I would like if you
    could please just cite one example of where the EPA has
    collaborated with a major industrial employer and they have
    increased their jobs in a significant way. Can you cite one
    example?
        Ms. Jackson. Yes, sir. The car industry has reduced their
    overall emissions over 40 years while the number of cars on our
    roads has continued to increase as our population got larger,
    and that is because of technological innovation that insisted
    that we not grow their profits at the expense of our health.
        Mr. McKinley. I am looking for one company that you have
    worked with, you collaborated with them and they have increased
    employment.
        Ms. Jackson. Certainly, sir. Any time an industry invests
    in pollution control, they are hiring workers, everything from
    engineers to technicians to people who design and implement and
    put on scrubber so that when you burn coal in a power plant,
    the emissions are clean. All of those jobs are part of the
    legacy----
        Mr. McKinley. The remark you made earlier----
        Ms. Jackson [continuing]. Of the Clean Air Act and EPA's--
    --
        Mr. McKinley [continuing]. Madam Administrator, that----
        Ms. Jackson [continuing]. To protect the public health.
        Mr. McKinley [continuing]. There were thousands of
    scientists and physicists across America that support this
    matter but yet there are thousands equally in opposition to
    that, such as physicist Hal Lewis, people within NOAA, people
    within the United Nations' climate control panel. There are
    others that are supporting that and they conveniently seem to
    be ignored in this. Was Hal Lewis wrong when he said this was
    one of the greatest frauds being perpetrated on the people of
    America?
        Ms. Jackson. Well, I do not know Mr. Lewis, sir, but I will
    say that our best scientists in the country have reached a
    consensus, and it is unequivocal, that the science is clear
    that manmade emissions of air pollution and global warming
    gases are changing----
        Mr. McKinley. Anthropogenic global warming----
        Ms. Jackson [continuing]. Our atmosphere.
        Mr. McKinley [continuing]. Is still an issue that the
    scientists are still debating, and you know it and I know it.
        Ms. Jackson. No, I do not agree with that.
        Mr. McKinley. I am an engineer and I----
        Ms. Jackson. I absolutely do not agree with that.
        Mr. McKinley [continuing]. Can tell you, it has not been
    determined.
        Ms. Jackson. I am an engineer as well, and I know to look
    to scientific experts to make decisions like this. I am not an
    expert on the climate so what we have done is look at people
    like the National Academies across----
        Mr. McKinley. Let me go back to a comment that perhaps it
    wasn't worded, because I found the answer a little humorous. It
    said something to the effect that you didn't presume to direct
    Congress how to act, so I am going to maybe--would you favor,
    do you support the idea that Congress may very well want to
    take action to--do they have the right to vote up or down on
    any major EPA regulatory offering?
        Ms. Jackson. Sir, the laws passed that I implement were
    passed by Congress. The Clean Air Act was passed by Congress.
    So I understand and recognize that under the U.S. Constitution
    Congress makes laws and then the executive branch executes the
    laws, absolutely.
        Mr. McKinley. So you would think Congress should have the
    right to approve any regulations before they are implemented?
        Ms. Jackson. No, sir. Congress already has the
    congressional Review Act, which allows it to review every
    regulation that is adopted by not just my agency, so that is
    certainly already the law of the land.
        Mr. McKinley. Ma'am, I will get back with the other
    questions to you. Thank you very much.
        Ms. Jackson. Thank you.
        Mr. Whitfield. The chairman recognizes Mr. Gardner of
    Colorado for 5 minutes.
        Mr. Gardner. Thank you, Administrator Jackson, for your
    time here today. I appreciate your willingness to be here, and
    I too have only been here for 34 days and it continues to amaze
    me how the scare tactics are thrown out as if everybody is
    speaking from the same page but the problem is, they are not,
    and I want to talk a little bit about criteria pollutants
    versus greenhouse gases. I think a lot of the scare tactics
    that we have heard in terms of the health concerns are criteria
    pollutants and greenhouse gas is not a criteria pollutant, and
    I think that is important to recognize, that a lot of the
    health concerns that have been raised here as scare tactics are
    based on criteria pollutants, and this bill does nothing
    dealing with criteria pollutants, the bill that we are
    discussing now.
        I want to follow up another question that some of the other
    members have asked. I met with a CEO of a company in Colorado
    who employs a thousand people directly, 2,000 people
    indirectly, and he mentioned to me at our meeting, this was
    just this past Friday, that he is very concerned about
    regulations because he is worried that the cost and reliability
    of energy and the energy and power infrastructure, he is
    worried about the energy infrastructure and he is worried about
    the ability of our country to continue to produce affordable
    energy for consumers and for businesses, and that being said, I
    believe Chairman Upton asked an earlier question regarding
    whether or not the EPA had done an cost-benefit analysis of the
    impact of EPA regulations. I believe your response was that the
    EPA had not done so because such analysis would have required
    the EPA to reach out to businesses in order to gather
    information regarding the impact of the EPA's regulations.
    Well, isn't that the right thing to be doing is to reach out to
    businesses in terms of the impact of this regulation?
        Ms. Jackson. No, I think that is not an accurate assessment
    of how the conversation went. I am happy to recount it for, it
    is in the record, but what I said was----
        Mr. Gardner. You don't think you ought to be talking to
    American businesses about these regulations first?
        Ms. Jackson. We talk to American businesses all the time,
    and I think that is the way to make smart commonsense
    regulations.
        Mr. Gardner. And so the American business community agrees
    that this regulation is the way to move forward?
        Ms. Jackson. The American business community has commented
    on the regulations as we move forward, and I would say that
    there are varying opinions. We have heard from small businesses
    who support the regulation because they believe it will help
    the clean energy sector. We have heard from several, I think 11
    utility company, who said that this is a commonsense,
    reasonable approach to----
        Mr. Gardner. Have you heard from some----
        Ms. Jackson [continuing]. Help to make them efficient.
        Mr. Gardner [continuing]. That they will lose jobs as a
    result?
        Ms. Jackson. I think all businesses talk about, when I talk
    to them, they want to make sure that they have regulatory
    certainty, and they are worried about their bottom line.
        Mr. Gardner. And they are worried about job losses?
        Ms. Jackson. Certainly I have seen studies----
        Mr. Gardner. Do you think they need to worry about job
    losses?
        Ms. Jackson. I think the President has made it clear that
    jobs are an absolute focus, sir, absolutely. Jobs are our
    absolute focus and we believe the clean energy sector is a
    place to grow jobs----
        Mr. Gardner. But what if they are not in the clean energy
    sector? Should they worry about jobs? I mean, this sounds like
    we are picking winners and losers and saying some jobs are
    better than others.
        Ms. Jackson. I do know this, sir: the Clean Air Act is
    supposed to relieve their minds about pollution in the air that
    might make them and their families sick.
        Mr. Gardner. That is a criteria pollutant, not greenhouse
    gas.
        Ms. Jackson. No, no, no. The endangerment finding makes
    clear that greenhouse gases also endanger public health and
    welfare.
        Mr. Gardner. But I think again we are confusing the issue
    of criteria pollutants and greenhouse gases. You mentioned
    earlier that ag would not be--there would be no imposition on
    agriculture, agricultural sources. I believe you put a timeline
    of 2013 on that. Will there be ag sources put under this rule
    after 2013?
        Ms. Jackson. I can't speculate to that. I have made a
    commitment that there will be no regulations for permitting for
    agricultural sources until July 2013.
        Mr. Gardner. But after that, there may be permitting
    requirements brought into this rule?
        Ms. Jackson. Yes. It is my hope still that Congress will
    look towards legislation at some point.
        Mr. Gardner. And on agriculture, I think it is important
    too when we talk about that agriculture is not affected by
    these rules and jobs in agriculture aren't affected by these
    rules, I want to point out a letter that talked about the cost
    about running a sprinkler for farmers in my district. The
    estimated cost of certain greenhouse gas emission controls
    would cost the farmer in this particular rural electric
    association nearly $2,000 a year per meter. Do you think that
    will affect their ability to hire people and to grow their
    operation?
        Ms. Jackson. Sir, I don't know what you are referring to. I
    am happy to review it, and I am also happy to again state what
    I said before, that as we put these regulations out, they are
    meant to be commonsense moves that in general will rely on
    energy efficiency and other moderate steps that will add up,
    that will get us started in moving towards reducing greenhouse
    gas pollution.
        Mr. Gardner. Do you believe that agriculture is affected by
    increased costs of energy?
        Ms. Jackson. Certainly.
        Mr. Gardner. Do you believe agriculture is impacted by the
    increased cost of fertilizer?
        Ms. Jackson. Certainly, sir.
        Mr. Gardner. Do you believe that these regulations will
    increase the cost of farming equipment?
        Ms. Jackson. No, sir, I don't necessarily believe that
    because I am not sure what regulations we are talking about. We
    have regulations on the board right now, for instance, for cars
    that make clear that they pay for themselves essentially
    because of the savings in fuel. There are tremendous
    opportunities in rural America for the economy to continue to
    grow as it has thrived over the past several years and we are
    not looking to regulate----
        Mr. Gardner. The economy has thrived over the past several
    years?
        Ms. Jackson. Rural America's economy has done fairly well
    as the rest of the country has seen the housing market and
    economy really do poorly.
        Mr. Gardner. Administrator Jackson, I would invite you to
    my district to meet with people who believe the economy has not
    thrived over the past few years.
        Ms. Jackson. I would be happy to do that, sir.
        Mr. Whitfield. I recognize the gentleman from Kansas, Mr.
    Pompeo.
        Mr. Pompeo. Thank you, Mr. Chairman.
        Thank you, Ms. Jackson, for coming today. In the 4th
    district of Kansas, we do lots of things. We have agriculture,
    and we make airplanes, a lot of airplane stuff, manufacturing.
    I came from that industry. The cost of manufacturing has driven
    lots of jobs. We have got unemployment in our aircraft
    manufacturing industry that is enormous, and families are
    hurting. I heard Mr. Waxman and Mr. Markey talk about children.
    I have seen the impacts on families from what the regulatory
    environment that this Administration has put forward has
    caused.
        I want to ask you in response to something you said to Mr.
    Shimkus, a question. You acknowledged the existence of the law
    of supply and demand or the economic principle, and then you
    joked about price elasticity because you wouldn't answer his
    question yes or no about what the price elasticity of something
    was. Tell me what you think the price elasticity of energy is
    as it relates to supply and demand.
        Ms. Jackson. The price----
        Mr. Pompeo. Is it zero? Does energy stay--as you impose
    regulations, does energy cost stay fixed?
        Ms. Jackson. Sir, I want to state here, I have not said
    that there are not potential costs to move to cleaner energy.
    What is at stake is making reasonable decisions on how to move
    to cleaner energy, less-polluting forms of energy but do it in
    a way that does not harm our economy, and I am committed as
    head of the EPA to enforcing and implementing the Clean Air Act
    to protect our public health but doing it in a way that is
    modest and moderate and that is mindful of our economy at the
    same time.
        Mr. Pompeo. I appreciate that. I will tell you that the
    folks that I talk to in the 4th district of Kansas don't
    believe there is anything moderate or modest about the
    proposals that your agency has put forward.
        I will ask you this. You earlier cited statistics that said
    that the benefits of the Clean Air Act have been about 40 to 1.
        Ms. Jackson. That is correct.
        Mr. Pompeo. It would seem to me then if we would just
    appropriate a trillion dollars, we could take out all the
    deficit because we get a 40 to one return on that investment.
    Is that what you are proposing in terms of return on invested
    capital?
        Ms. Jackson. No, sir. What I am trying to propose is that
    for every dollar invested to control pollution and protect
    public health, that is $40 of health costs that the American
    people are avoiding. They are healthier and more productive
    because they don't have to worry about increased asthma attacks
    and premature death as a result of----
        Mr. Pompeo. Right, and if your analysis is therefore right,
    what do we spent on health care a year, we just pick 40 of that
    number and we would invest that amount of money and we would
    solve the health care problem. That is what your analysis
    suggests. Am I misunderstanding something?
        Ms. Jackson. Yes, you are, sir.
        Mr. Pompeo. OK. Help me understand what it is I am
    misunderstanding.
        Ms. Jackson. You are misunderstanding the point that the
    Clean Air Act is a public health statute. It is designed to
    protect the health of Americans through preventive medicine, if
    you will. It removes pollution from the air that causes asthma
    attacks, that causes lung disease, that make us and our
    children----
        Mr. Pompeo. I understand. I have one more question. I want
    to clean up a couple things you said earlier. You spoke to the
    fact that you appreciated regulatory certainty being important,
    and then you just told Mr. Gardner that our agricultural
    community gets something less than 2 years of certainty with
    respect to greenhouse gas regulation. I will tell you that
    their return on invested capital calculations go far past 24
    months, and so I am trying to understand how you can argue that
    you think regulatory certainty is important and yet tell us
    that our agriculture folks in the 4th district get just a
    little less than 24 months before you will chase them too.
        Ms. Jackson. Well, sir, I am not here to tell your
    constituents or anyone else for that matter that greenhouse
    gases are not a problem or are not something that we should be
    addressing as a country. I believe that we should be
    incentivizing and innovating to move to cleaner forms of energy
    and reduce the accumulation of greenhouse gases in our
    atmosphere, and that is something that is out there not because
    I sit in this seat, sir, but because----
        Mr. Pompeo. If you believe----
        Ms. Jackson [continuing]. They are a challenge for our
    country.
        Mr. Pompeo. Fair enough. If you believe that these
    regulations were going to have a net loss of jobs, would this
    change your view of how the EPA ought to proceed?
        Ms. Jackson. Certainly, sir. If I was seeing regulations
    that I thought----
        Mr. Pompeo. Thank you.
        Mr. Whitfield. The gentleman from Virginia, Mr. Griffith,
    is recognized for 5 minutes.
        Mr. Griffith. Thank you, Mr. Chairman.
        Massachusetts v. EPA, last line, the holding, ``We hold
    only that the EPA must ground its reasons for action or
    inaction in the statute.'' Can you tell me where in the statute
    it allows you to create a tailoring rule?
        Ms. Jackson. The tailoring rule is based on our belief that
    the statute does not speak to the fact that there be too many
    sources to regulate all at once. It is an absurd result. That
    is the theory of the law----
        Mr. Griffith. And I don't disagree with you, ma'am.
        Ms. Jackson [continuing]. On which we based the rule.
        Mr. Griffith. It is an absurd result but that is what the
    law says, and isn't it the right of the elected officials, this
    Congress to make that decision and not unelected officials in
    the EPA?
        Ms. Jackson. Sir, the United States Supreme Court held that
    the Clean Air Act----
        Mr. Griffith. You had to do something, but it said you had
    to follow the statute----
        Mr. Rush. Mr. Chairman.
        Mr. Griffith [continuing]. You followed the statute----
        Mr. Rush. Mr. Chairman, Mr. Chairman. We have sat here and
    watched the questions from the members on this subcommittee and
    they ask questions and the witness attempts to answer, and they
    won't allow her the opportunity to complete her answer. So
    would you admonish members to allow the witness to complete her
    answer before they interrupt her?
        Mr. Whitfield. Mr. Rush, thank you for that. These members
    have waited a long time, and you have been very patient to be
    here, but I am going to allow them to continue to ask questions
    and----
        Mr. Rush. And can the witness please answer? She has been
    here for a long time also.
        Mr. Griffith. I will make it a yes or no question. Do you
    believe that EPA should follow law as written or request
    Congress to change it or ask Congress to relieve them of that
    obligation when the result of the law would be an absurd
    result? Yes or no, please.
        Ms. Jackson. I believe EPA should follow the law as
    interpreted by the United States Supreme Court and the rules
    that we have on the books are designed to avoid the absurd
    result. That is the basis for the rulemaking we have made. That
    is the basis for our attempts to be as reasonable as we can.
        Mr. Griffith. In regard to certainty, and I am doing a
    little cleanup too. In regard to certainty, you indicated that
    there were no plans for a cap-and-trade program. How long can
    you give me certainty----
        Ms. Jackson. I should have said for greenhouse gases
    because we have a cap-and-trade for----
        Mr. Griffith. OK. For greenhouse gases cap and trade, you
    said you had no plans, do you have any ability to give the
    businesses, the industries and the folks that produce in my
    district any certainty how long can they count on that?
        Ms. Jackson. They will see proposed rules long before for
    public comment and we have agreed to do industry listening
    sessions to hear from the industries how best they think we
    should approach future regulations. So there will be a
    transparent process. There will be no secrets. I do not believe
    there will ever be a cap-and-trade program authorized under the
    Clean Air Act.
        Mr. Griffith. Thank you. And then let me ask you, when you
    talked about health and safety of the American folks in looking
    at the endangerment ruling, I am wondering if you all looked at
    the fact, because you mentioned something about the heat being
    higher, causing folks to have strokes or heart attacks, etc.,
    and I am wondering if you looked at the fact that with the
    electric rates going up, the heating bills going up, fuel oil
    going up, that there are a lot of folks in my district who are
    having a hard time paying for their heat, and what is the
    offset on the other side? Did you look at what is going to cost
    those folks and the danger to their health by not having
    sufficient heat?
        Ms. Jackson. Sir, I am absolutely not asking people to
    freeze to death or be very warm in the summer. I am not sure I
    understand your question.
        Mr. Griffith. Well, you said in your opening statement that
    one of the things that you looked at in making the endangerment
    ruling was the fact that increased heat when folks--if the
    planet warms that folks are going to suffer more disease as a
    result of overheating and heart attacks, I think you mentioned
    heart attacks or strokes. And I am just asking if the counter
    side to that was looked at and the fact that we are going to
    raise the cost for Americans to buy fuel, therefore some of
    them are not going to have sufficient heat to heat their homes.
        Ms. Jackson. The actions we have taken under the greenhouse
    gas regulations are not intended to make less fuel available to
    Americans, sir, so these are commonsense steps that actually in
    the case of the car rule means we will need less oil. They are
    energy efficiency. They are meant to make us get every drop of
    energy we can out of every drop of gasoline or fuel that we
    use. So perhaps I am not understanding. The endangerment
    finding----
        Mr. Griffith. All right. Are you unaware that the
    regulations already imposed and additional regulations that are
    being placed on the power plants of the United States of
    America will make it more difficult to use coal, which is now
    50 percent of our source, and if you eliminate that as a
    source, you are going to raise the cost of electricity,
    therefore making it harder for people to heat their homes.
        Ms. Jackson. We are not intending to eliminate coal as a
    source of fuel. That is not the goal of reducing greenhouse gas
    emissions. What we are saying is that we can use the Clean Air
    Act to make a start in reducing greenhouse gas emissions.
        Mr. Griffith. And I am wondering if you all have looked at
    the possibility that since I believe that you will send a
    number of jobs overseas that the Chinese and the Indians and
    even the Ukrainians are going to use coal from my district and
    other districts around the United States that the impact of
    that is that we actually have more manufacturing in areas where
    they are not doing even the reasonable things that we are doing
    at this point, therefore contributing to the global environment
    additional pollutants in the air which will actually harm
    Americans more than what you believe your actions will solve.
        Ms. Jackson. As I said earlier, sir, changing the future
    with respect to climate change for our planet is going to
    require all nations to do something but I do not believe that
    means that we all therefore must start at the same time. Parts
    of Europe have already started, so clearly it is not----
        Mr. Whitfield. Well, I think everyone has had an
    opportunity to ask questions. Ms. Jackson, we appreciate your
    taking time to be with us. We are going to be having some
    hearings on the air transport rules, new source review, fly
    ash, some other issues, and so we look forward to your coming
    back to have additional discussions with us.
        I know throughout this questioning period with you, a
    number of members said they were going to be submitting written
    questions for you to answer. Who on your staff should we be
    particularly focused on to deal with that issue?
        Ms. Jackson. Well, I always accept correspondence from
    members but the head of my Office of Congressional and
    Intergovernmental relations is David McIntosh, if you would
    prefer to direct your staff towards him.
        Mr. Whitfield. David McIntosh?
        Ms. Jackson. Yes, Mr. Chairman, but I will take any
    questions you have.
        Mr. Whitfield. Well, thank you very much, and at this time
    I would like to call up the third panel, and that is the Hon.
    Greg Abbott, who is Attorney General of the State of Texas; Mr.
    Steve Cousins, Vice President of Lion Oil Company; Mr. Harry
    Alford, President and CEO, National Black Chamber of Commerce;
    Mr. Lonnie Carter, President and CEO of Santee Cooper; Mr.
    Steve Rowlan, General Manager, Environmental Affairs, Nucor
    Corporation; Betsey Blaisdell, Senior Manager of Environmental
    Stewardship, the Timberland Company; and Mr. James Pearce,
    Director of Manufacturing for FMC Corporation.
        OK. I want to thank all of you. You have been very patient
    today, and yet this is an issue of great importance. It has
    significant impact on our country in a lot of different ways,
    so we look forward to the testimony of all of you. Mr. Abbott,
    you are the Attorney General of Texas. We are going to start
    with you. We will recognize you for 5 minutes for your opening
    statement, and then we will go right down the line, and before
    we ask any questions we will have all of you complete your
    opening statements, so Mr. Abbott.

     STATEMENTS OF GREG ABBOTT, ATTORNEY GENERAL, STATE OF TEXAS;
     HARRY C. ALFORD, PRESIDENT AND CEO, NATIONAL BLACK CHAMBER OF
    COMMERCE; STEVE ROWLAN, GENERAL MANAGER, ENVIRONMENTAL AFFAIRS,
    NUCOR CORPORATION; JAMES PEARCE, DIRECTOR OF MANUFACTURING, FMC
    CORPORATION; STEVE COUSINS, VICE PRESIDENT, LIONS OIL COMPANY;
    LONNIE N. CARTER, PRESIDENT AND CEO, SANTEE COOPER; AND BETSEY
      BLAISDELL, SENIOR MANAGER OF ENVIRONMENTAL STEWARDSHIP, THE
                           TIMBERLAND COMPANY

                        STATEMENT OF GREG ABBOTT

        Mr. Abbott. Thank you, Mr. Chairman, for the opportunity to
    appear before this subcommittee. As you noted, my name is Greg
    Abbott and I am the Attorney General of the State of Texas, and
    I want to first point out that in my submitted remarks I have
    more detail about this but Texas has strived to work very
    effectively with the EPA to enforce environmental laws. Texas
    also strives to prevent political before it occurs. Ozone and
    NOx emissions have been on a steady decline in Texas
    since 2000. Texas has installed more wind power than any other
    State and achieved one of the largest declines in greenhouse
    gas emissions of any State in the Nation. Texas remains
    committed to working with the EPA to improve air quality and to
    hold polluters accountable, but Texas cannot support the EPA's
    regulation of greenhouse gases. Texas believes the EPA has
    ignored the plain language of the Clean Air Act, violated
    notice and comment requirements, and attempted to rewrite
    federal laws written by the United States Congress by the
    administrative rulemaking process.
        Texas lodges several challenges to the EPA's regulation of
    greenhouse gases. For now I will try to plug in just three of
    them that reveal legal problems with the EPA's regulations. One
    that you all talked about already a lot this morning is the
    tailoring rule. The Clean Air Act defines in precise numerical
    terms the emission thresholds that trigger permitting
    requirements for stationary sources. The EPA concedes that
    regulation of greenhouse gases at these statutory thresholds
    produce results ``inconsistent with the congressional intent
    concerning the Clean Air Act'' by subjecting thousands of
    schools, churches, farms, small businesses to Clean Air Act
    regulation. These admittedly absurd results indicate that
    greenhouse gases simply are not the kind of substance the Clean
    Air Act was designed to regulate. Well, dissatisfied with
    Congress's clear instructions, the EPA attempted to amend by
    administrative fiat the Clean Air Act. EPA calls the revised
    language its tailoring rule and we believe that the EPA has
    violated the Clean Air Act by its tailoring rule.
        Texas also challenged the EPA's SIP call rule. The Clean
    Air Act empowers the EPA to require States to amend their
    permitting programs by issuing a SIP call. The Act gives States
    up to 3 years to bring their regulatory program into compliance
    with major federal mandates such as the greenhouse gas
    regulations. When the EPA issued the SIP call rule on September
    2, 2010, it gave States just 15 months until December 2, 2011,
    to change their laws and regulations to comply with the new
    greenhouse gas mandate. The EPA shortening the time frame
    violates the Clean Air Act by giving States just 15 months,
    rather than the congressionally mandated 36 months.
        Texas also challenged the EPA's FIP rule. In August 2010,
    we informed the EPA that Texas would not satisfy the EPA's
    greenhouse gas demands. A few months later in late October
    2010, an assistant EPA administrator filed a sworn statement in
    federal court swearing that the EPA could not take over Texas
    air permitting program until December 2, 2011, at the earliest,
    meaning almost 10 months from this very day. Well, despite that
    sworn statement, the EPA did a 180-degree turn on December 23rd
    and issued an emergency FIP rule in an attempt to immediately
    federalize Texas's air permit program. When it suddenly changed
    courses, the EPA not only acted duplicitously, it also violated
    the Administrative Procedures Act, which requires the EPA to
    solicit notice and comment from the public. The EPA's FIP rule,
    however, was issued without notice and comment period at all in
    direct violation of federal law.
        Not only did the FIP rule violate the notice and comment
    required by the APA, it was promulgated just before the
    Christmas and New Year's holidays in an obvious attempt to
    minimize public scrutiny. The EPA had known for more than 4
    months that Texas would not comply with the SIP call rule and
    yet it waited until just before Christmas to announce without
    public comment or notice that a supposed emergency required it
    to seize control of the air permitting system in Texas just 2
    weeks later on January 2, 2011. These are some of the reasons
    why Texas is lodging its legal challenges against the EPA.
        [The prepared statement of Mr. Abbott follows:]

        [GRAPHIC] [TIFF OMITTED] T5734.134

        [GRAPHIC] [TIFF OMITTED] T5734.135

        [GRAPHIC] [TIFF OMITTED] T5734.136

        [GRAPHIC] [TIFF OMITTED] T5734.137

        [GRAPHIC] [TIFF OMITTED] T5734.138

        [GRAPHIC] [TIFF OMITTED] T5734.139

        [GRAPHIC] [TIFF OMITTED] T5734.140

        [GRAPHIC] [TIFF OMITTED] T5734.141

        [GRAPHIC] [TIFF OMITTED] T5734.142

        [GRAPHIC] [TIFF OMITTED] T5734.143

        [GRAPHIC] [TIFF OMITTED] T5734.144

        [GRAPHIC] [TIFF OMITTED] T5734.145

        [GRAPHIC] [TIFF OMITTED] T5734.146

        [GRAPHIC] [TIFF OMITTED] T5734.147

        [GRAPHIC] [TIFF OMITTED] T5734.148

        Mr. Whitfield. Thank you, Mr. Abbott.
        At this time I recognize Mr. Alford with the Chamber of
    Commerce.

                      STATEMENT OF HARRY C. ALFORD

        Mr. Alford. Chairman Whitfield, Mr. Vice Chairman,
    distinguished members of this committee, thank you for having
    me. I am Harry C. Alford, President and CEO of the National
    Black Chamber of Commerce.
        After failing to persuade the American public of its
    intentions to pass a cap-and-trade program through the
    legislative process, the Obama Administration has now unleashed
    its Environmental Protection Agency to tackle climate change
    with non-transparent, burdensome regulations. This bureaucratic
    zeal is not only disastrous for American consumers and
    businesses at large but also particularly threatening to the
    future of prosperity of black communities.
        The Energy Tax Prevention Act of 2011, introduced by
    Representatives Upton and Whitfield and Senator Inhofe, offers
    our Nation a much-needed reprieve from this EPA overreach and
    it is my hope that both Democrats and Republicans will join
    this new effort to stop the agency's power grab of our domestic
    climate policy. Congress must be in charge of policymaking for
    such a serious issue, one that touches the lives and welfare of
    virtually every American, not unelected officials with zero
    accountability.
        The Act aims to protect American jobs and businesses,
    especially in light of increasing competition from developing
    nations such as China. Again, for the African American business
    community and black workers nationwide, EPA's regulatory
    overreach will kill their competitiveness and innovation and
    impose significant burdens to new employment.
        Back in 1979, manufacturing employment here in America
    reached its high point, providing jobs to roughly 19.6 million
    Americans. Since then, we have lost more than 8 million
    manufacturing jobs. Now, many of the factories that once
    employed our workers here in the United States are now popping
    up in China, Indonesia and other Asian countries.
        When I was a young man, I began my career in Detroit. Upon
    revisiting throughout the years, I can attest to how cumbersome
    government regulations have come to destroy small businesses
    and starve families. EPA's plan to implement emission
    regulations will sadly result in far greater strife. This
    strife will be borne particularly hard by the African American
    labor force, one that has not only been underrepresented in the
    workforce historically but also badly wounded since the
    financial meltdown. Today 16.5 percent of African American men
    and women are out of work and the situation is only getting
    worse. According to a new study by the Economic Policy
    Institute, the black unemployment rate is projected to hit a
    25-year high by the third quarter of this year.
        Additional EPA proposals that have sought to tighten air
    quality standards with regard to ozone exemplified mammoth
    business-destroying implications as well. For instance, the
    National Federation of Independent Business found that as many
    as 675 counties across the United States would violate the
    proposed standards, triggering job-killing mandates, costly
    compliance fees and financial penalties for businesses in those
    areas. Just imagine how businesses would be forced to close and
    how many workers would be laid off if EPA's broader proposal to
    implement a regulatory cap-and-trade scheme is successful.
        Long story short: the environment belongs to everyone. For
    EPA to think that it can use the Clean Air Act to now ram
    through cost-prohibitive climate regulation is something I will
    not stomach and it certainly is not something that the African
    American business community is prepared to accept either. While
    paying a higher heating bill this month or doling out money for
    gasoline on the way into the office from McLean or Bethesda may
    mean little to government bureaucrats, people living paycheck
    to paycheck and small businesses trying to get by simply cannot
    afford it, especially now.
        I applaud all members of the legislature who are working
    hard to make sure that EPA does not enact a cap-and-trade
    scheme and therefore are standing up for not only America's
    economic future but also for the well-being of our Nation's
    African American community specifically.
        Again, thank you for this opportunity to testify here this
    morning on the important of the Energy Tax Prevention Act and
    halting EPA's regulatory overreach. I look forward to answering
    any questions you may have.
        [The prepared statement of Mr. Alford follows:]

        [GRAPHIC] [TIFF OMITTED] T5734.149

        [GRAPHIC] [TIFF OMITTED] T5734.150

        [GRAPHIC] [TIFF OMITTED] T5734.151

        [GRAPHIC] [TIFF OMITTED] T5734.152

        [GRAPHIC] [TIFF OMITTED] T5734.153

        [GRAPHIC] [TIFF OMITTED] T5734.154

        [GRAPHIC] [TIFF OMITTED] T5734.155

        [GRAPHIC] [TIFF OMITTED] T5734.156

        Mr. Whitfield. Thank you, Mr. Alford.
        Mr. Rowlan with Nucor Corporation, you are recognized for 5
    minutes.

                       STATEMENT OF STEVE ROWLAN

        Mr. Rowlan. Thank you. I am Steve Rowlan, General Manager
    of Environmental Affairs for Nucor Corporation. Thank you,
    Chairman Whitfield and Vice Chairman Sullivan, for this
    invitation to testify today on the impact of greenhouse gas
    regulations on our industry and other industries in our
    Nation's economy.
        Nucor is the largest steel producer and recycler in the
    United States. We employ over 20,000 teammates in 23 States and
    produce steel products for use in road, bridges, automobiles,
    appliances, buildings and a range of other markets.
        The impact of the great recession on the steel industry was
    swift and severe. In August of 2008, steel capacity utilization
    was over 90 percent. By January 2009, capacity utilization had
    plummeted to 36 percent. In a mere 5 months, the industry went
    from experiencing strong growth and excellent market conditions
    to the worst economy many of us in the industry have ever seen.
    Despite how bad that market got, Nucor did not lay off a single
    worker.
        The economic conditions for the steel industry are
    improving. Capacity utilization has increased and we are seeing
    a return in demand. However, the strength and duration of the
    economic recovery remains to be seen. Greenhouse gas
    regulations are adding to this uncertainty.
        U.S. steel producers are in a highly competitive global
    market that will only get more competitive in the future. We
    face unfair practices from steelmakers in countries like China,
    and increasingly, we are not competing against other companies,
    but against governments, governments who bring their full
    weight to bear to ensure the success of their domestic industry
    through the use of subsidies, generous loans and other
    protectionist measures. I would say that is a pretty strong
    headwind to compete against. And the uncertainty created by our
    government's many regulatory proposals only adds to that
    headwind and diminishes the competitiveness of many U.S.
    industries.
        From an environmental perspective, America is the best
    place in the world to make steel. Our industry has reduced its
    energy-intensity by 30 percent since 1990, and reduced
    greenhouse gas emissions by 35 percent over the same time
    period while increasing overall production. This significantly
    exceeds the Kyoto Protocol targets. In fact, the U.S. steel
    industry has the lowest CO2 emissions per ton in the
    world. What is more, companies like Nucor have made steel the
    most recycled product in the world. As the Nation's largest
    recycler, Nucor kept more than 17 million tons of scrap metal
    from cars, appliances, and other discarded products out of
    landfills in 2010. The recycled scrap is then melted down
    through the use of electrical energy and made into new steel
    products.
        Because greenhouse gas emissions are a global issue,
    regulation through the Clean Air Act threatens both our
    competitiveness and the environmental benefit that results from
    making steel so cleanly in the United States. Ironically, these
    very regulations and practices that are intended to improve the
    environment actually result in increased global emissions and
    more environmental impact than if the industry had remained in
    the United States.
        The problems these regulations create manifest themselves
    in the permitting process and other ways. Everyone expresses
    concern about permitting and the impact these rules have on our
    ability to build industrial projects that create jobs and
    improve people's livelihoods. However, this is not a new
    problem. Over time, we have created a system that is comprised
    of endless reviews, hearings, allegations, lawsuits and
    continued modeling that has turned our permitting process into
    a slow, frustrating experience that has eliminated the
    certainty necessary for the expenditure of capital. I have been
    quoted as saying it is like being in a hamster wheel. The lack
    of availability of affordable energy also remains a real
    obstacle.
        Due to the continual halting of permits for new,
    traditional sources of energy generation and constantly
    promoting the development of expensive so-called green energy,
    we as a Nation are essentially pricing ourselves out of the
    industrial market. Mechanisms such as greenhouse gas rules,
    regional cap-and-trade programs, renewable energy standards and
    other permit battles are creating an environment where
    affordable energy, the lifeblood of industry, is becoming a
    rare commodity. For example, I modeled a facility that would
    recycle a million tons of steel and I looked at it in areas
    that had a renewable energy standard versus areas that had no
    renewable energy standard, and the difference in electrical
    cost was $52 million a year. As I presented that to the people
    in that particular State, I asked where we would build that
    facility, and they said not in our State. That is why you see
    industry moving to areas that have affordable and abundant
    energy.
        It looks like I am about out of time. We have something
    said about a permit that was recently issued to Nucor. I will
    tell you that we did receive a permit for a significantly
    diminished project versus the $2.1 billion we were going to
    invest. That permit, however, for that project, which will be
    phase 2, is still not fully issued. It is stayed pending some
    further actions. Thank you for your time.
        [The prepared statement of Mr. Rowlan follows:]

        [GRAPHIC] [TIFF OMITTED] T5734.157

        [GRAPHIC] [TIFF OMITTED] T5734.158

        [GRAPHIC] [TIFF OMITTED] T5734.159

        Mr. Whitfield. Thank you, Mr. Rowlan.
        At this time I recognize Mr. Pearce for 5 minutes, and Mr.
    Pearce is Director of Manufacturing for FMC.

                       STATEMENT OF JAMES PEARCE

        Mr. Pearce. Mr. Chairman, Ranking Member Rush and members
    of the committee. My name is Jim Pearce, and I am the
    Manufacturing Director for FMC's Alkali Division, and I thank
    you for holding the hearing on this important topic.
        FMC is a diversified chemical company manufacturing
    products for the food and pharmaceutical industries, for
    lithium batteries and energy storage. Our FMC products are used
    in a wide range of industrial usage and new applications to
    improve the environment.
        In Green River, Wyoming, where I live and work, we are the
    world's largest producer of sodium carbonate, better known as
    soda ash. The largest use of soda ash is in glass
    manufacturing, including food, juice, beer and wine containers,
    fiberglass, and flat glass for autos, houses, and buildings. It
    is also used in a number of household products such as a water
    softener, and it is the primary ingredient in powdered home
    laundry detergents. In Wyoming, we produce soda ash from
    naturally occurring trona ore that is mined from underground
    deposits. The four companies that comprise the so-called trona
    patch in Sweetwater, Wyoming employ over 2,100 people and
    account for roughly 90 percent of the domestic soda ash
    production in the United States and 25 of total global soda ash
    production. In addition, there are some 100 dockworkers in
    Portland, Oregon, and we estimate an additional 8,300 jobs
    nationwide that are dependent on our industry.
        Mr. Chairman, today American soda ash production is one of
    the good news stories in manufacturing. Our industry is a prime
    example of how government trade and lands policies can work to
    help sustain a U.S. manufacturing base. At FMC, we have
    improved our energy efficiency of our soda ash operations by 10
    percent over the past 10 years, and as an entire company we
    have met our commitment to the Chicago Climate Exchange Program
    reducing our greenhouse gas emissions by 10 percent from 2003
    to 2010. For FMC, energy efficiency simply represents smart
    business.
        The current U.S. approach to regulating greenhouse gases
    not only fails to incentivize us to achieve greater energy
    efficiency, but over time it may lead U.S. natural soda ash
    producers to lose business to our off-shore rivals, mainly the
    Chinese, who produce their soda ash synthetically. Synthetic
    soda ash generates an average of 30 percent greater greenhouse
    gas emissions per ton than does soda ash mined from natural
    resources.
        Mr. Chairman, our jobs growth in the natural soda ash
    industry is fueled by exports. The U.S. natural soda ash
    industry contributes over $875 million in surplus to the
    overall U.S. balance of trade, and our export sales have grown
    at 6\1/2\ percent per year over the last 28 years. This
    represents a significant contribution to the President's goal
    of increasing U.S. exports. It also contributes to job growth.
    FMC recently announced that we will be adding 100 new jobs in
    Green River as a result of export growth, directly exports.
    Domestic soda ash producers export 52 percent of what we
    produce, 52 percent. That means that one of our every two jobs
    is directly attributable to export sales.
        Keeping our lead is not something that we take for granted,
    nor has Congress. For example, the Congress saw fit to reduce
    the royalties that we pay on soda ash, realizing that the
    export increase would result in higher Treasury revenues, yet
    the pressure to remain competitive continue to grow. As an
    example, in 1990 China imported about 1 million tons per year
    of soda ash. Today, they are the world's largest producer of
    soda ash and export about 2.5 million tons per year.
        We have serious concerns about our future and our
    competitive position if not required to make non-economic
    decisions based on domestic regulations that our international
    competitors do not have to comply with. We do not understand
    why U.S. manufacturers should be required to make costly
    changes when less-efficient and higher greenhouse gas-emitting
    foreign competition does not.
        A Southeast Asian glass manufacturer will not buy from a
    U.S. soda ash producer whose prices are high simply because of
    U.S. regulations. Rather, they will buy from the lower-cost
    foreign competition that produces more greenhouse gas
    emissions.
        We ask Congress to take the long view on this matter and
    understand that acting in isolation may place the domestic soda
    ash industry at a significant competitive disadvantage while
    increasing the overall greenhouse gas global emissions. We
    would hope that Congress would fully debate the energy policies
    and drive energy efficiency in a way that not only maintains
    jobs but grows them along with exports.
        Thank you very much for this opportunity.
        [The prepared statement of Mr. Pearce follows:]

        [GRAPHIC] [TIFF OMITTED] T5734.160

        [GRAPHIC] [TIFF OMITTED] T5734.161

        [GRAPHIC] [TIFF OMITTED] T5734.162

        [GRAPHIC] [TIFF OMITTED] T5734.163

        [GRAPHIC] [TIFF OMITTED] T5734.164

        [GRAPHIC] [TIFF OMITTED] T5734.165

        [GRAPHIC] [TIFF OMITTED] T5734.166

        Mr. Whitfield. Thank you, Mr. Pearce.
        Mr. Cousins, you are recognized for 5 minutes, of Lion Oil
    Company.

                       STATEMENT OF STEVE COUSINS

        Mr. Cousins. Chairman Whitfield, Ranking Member Rush,
    members of the subcommittee. My name is Steve Cousins. I serve
    as Vice President of Lion Oil Company. I am a chemical engineer
    and I have spent my 33-year career at Lion Oil.
        My company's survival and our employees' jobs are
    threatened by the Environmental Protection Agency's moves to
    regulate greenhouse gas under the Clean Air Act. We believe
    these actions by the EPA are contrary to the plain wording of
    the Clean Air Act, are unwise and endanger America's economic
    and national security. This is why it is so important that you
    approve the Energy Tax Prevention Act of 2011 to stop EPA from
    moving forward with its regulations.
        Lion Oil is in El Dorado, Arkansas. We have been in
    business for 88 years. We produce 80,000 barrels a day of
    gasoline, diesel and asphalt. We sell to customers in seven
    States, and we have 600 people at our unionized El Dorado
    plant. We employ indirectly approximately 1,800 other people
    that support our company. We are in rural Delta County, where
    unemployment runs about 10 percent.
        I can give you one personal example of how EPA's current
    regulatory path has already inflicted real pain on the people
    in our small town. Lion Oil undertook a major expansion,
    several hundred million dollars, starting in 2007. The
    projected created 2,000 construction jobs in a town with only
    20,000 people in it. It was a real shot in the arm for our
    economy. Unfortunately, economic risk prevented us from
    reaching our goal. It left us with a much smaller project that
    provided much fewer jobs. The uncertainty and the potentially
    prohibitive costs associated with both at that time cap-and-
    trade legislation and also EPA's looming greenhouse gas
    legislation were critical factors leading us to delay
    completion of this expansion.
        Ironically at the very same time construction jobs were
    being terminated in El Dorado, Arkansas, in India, more than
    75,000 workers were embarking on a 3-year project to build a
    brand-new state-of-the-art refineries 15 times larger than our
    plant. It is designed purely for export purposes. Every drop of
    gasoline and diesel they produce is going to end up in the
    United States or the European Union. And while our Arkansas
    union workers average over $23 an hour in wages, in India those
    same workers make about $5 an hour.
        It is going to take a crystal ball to determine exactly how
    the EPA enforces efficiency standards on refineries. We think
    that that is a likely thing we heard the Administrator testify
    to, and it sounds like a great idea but it sets up a scenario
    that we see where a small plant like ours is compared to plants
    five to ten times our size. Economies of scale always favor
    larger plants, the same way a 747 airliner uses a lot less fuel
    per passenger mile than a Piper Cub because it is larger and
    can be designed at far higher efficiency standards. Our plant,
    if we are held to the largest plants in the world to the same
    efficiency standards, then there is no cost that will allow us
    to achieve this. It would be out of reach and it will put us
    out of business. EPA has traditionally not shown the kind of
    flexibility that you would have to have to allow for those
    differences.
        In spite of our alarm at EPA's current path, Lion Oil is
    not in favor of turning back to the clock on environmental
    progress. We are very proud of what we have done. Since 1996,
    we reduced emissions from our facility by 73 percent while
    actually increasing plant throughput but it has come at a very
    high cost. Expenditures at our small facility has topped $200
    million in that time period in new environmental equipment with
    more than $19 million in increased operating costs. These costs
    are for the most part things that foreign refineries do not
    have to bear, and while many of these improvements offer real
    tangible environmental benefits, that is not true for EPA's
    plan to regulate greenhouse gases. Reducing U.S. greenhouse
    gases unilaterally, which is all EPA has the ability to do,
    will not reduce global concentrations of greenhouse gases at
    all, not significantly, and will most likely result in the
    export of U.S. jobs to countries not interested in greenhouse
    gas limits. This is exactly why the EPA does not need to be in
    the greenhouse gas regulation business.
        Under the Energy Tax Prevention Act of 2011, our elected
    representatives in Congress will have the ability to create a
    balanced and workable energy policy that does not disadvantage
    American workers. Thank you.
        [The prepared statement of Mr. Cousins follows:]

        [GRAPHIC] [TIFF OMITTED] T5734.167

        [GRAPHIC] [TIFF OMITTED] T5734.168

        [GRAPHIC] [TIFF OMITTED] T5734.169

        [GRAPHIC] [TIFF OMITTED] T5734.170

        [GRAPHIC] [TIFF OMITTED] T5734.171

        [GRAPHIC] [TIFF OMITTED] T5734.172

        [GRAPHIC] [TIFF OMITTED] T5734.173

        [GRAPHIC] [TIFF OMITTED] T5734.174

        [GRAPHIC] [TIFF OMITTED] T5734.175

        [GRAPHIC] [TIFF OMITTED] T5734.176

        [GRAPHIC] [TIFF OMITTED] T5734.177

        [GRAPHIC] [TIFF OMITTED] T5734.178

        [GRAPHIC] [TIFF OMITTED] T5734.179

        [GRAPHIC] [TIFF OMITTED] T5734.180

        Mr. Whitfield. Thank you, Mr. Cousins.
        At this time I recognize Mr. Carter for 5 minutes.

                       STATEMENT OF LONNIE CARTER

        Mr. Carter. Chairman Whitfield, Ranking Member Rush and
    members of the subcommittee, my name is Lonnie Carter and I am
    the President and Chief Executive Officer of Santee Cooper, the
    South Carolina Public Service Authority. While I am currently
    serving as the Chairman of the Board of Directors of the
    American Public Power Association, my comments and presence
    here today solely represent those of Santee Cooper.
        Santee Cooper has been a resource for improving the health,
    welfare, and material success of the residents of South
    Carolina. Santee Cooper is guided----
        Mr. Upton. Excuse me. Is that----
        Mr. Whitfield. Is your microphone on?
        Mr. Carter. It has got a little green light that says it is
    on. Is that better?
        Mr. Whitfield. That is better. Thanks.
        Mr. Carter. It may be that slow southern accent that is
    slowing you down.
        We are still handling our mission for improving the quality
    of life for the people of South Carolina by providing low-cost,
    reliable power and water to our customers while being good
    environmental stewards. As South Carolina's State-owned
    electric and water utility, we have served 2 million customers
    either directly or indirectly. We are accountable for keeping
    electricity affordable and the lights on.
        Our industry is at a time of unprecedented change and
    challenge, the likes of which I have not seen in my 28 years in
    this industry, bringing with it uncertainty and high cost to
    customers. I am very concerned about the many proposed EPA
    regulations and what they may mean in the short and long term.
    As a public power entity, we have no shareholders to share the
    cost of regulations. We are literally where the rubber meets
    the road. We are the State's leader in renewable energy with
    197 megawatts of renewable generation already online or under
    contract. They are voluntary business decisions that
    successfully balance low cost, reliability and care for the
    environment.
        Santee Cooper has been a leader in installing environmental
    control technology and in fact already reduces nitrogen oxide
    by over 90 percent and sulfur dioxide by as much as 90 percent
    through SCRs and scrubbing at our generating stations. We
    launched a $113 million comprehensive energy efficiency
    campaign for our customers in 2009. We are also a leader in
    this Nation's reentry into the nuclear energy arena on tap to
    build two new nuclear facility in 2016 and 2019 with our
    partner, SCANA.
        If I were not here today, I would be at an economic
    development announcement. One of our largest industrial
    customers, Showa Denko Carbon, Inc., is announcing a multiple-
    hundred million dollar investment to expand their facility.
    This project will create approximately 100 new jobs. Here is my
    point. By far the biggest concern going forward with this
    project is the uncertainty created by EPA's greenhouse gas and
    non-greenhouse gas regulations. This example highlights the
    issues with greenhouse gas regulations. The proposed
    regulations will result in higher costs and greater uncertainty
    for my customers.
        EPA also announced its desire to address greenhouse gases
    for the power sector through new source performance standards
    that will set emission guidelines for existing facilities.
    There is currently no off-the-shelf technology available to
    address greenhouse gas emissions at a commercial scale, making
    it different in like and kind from other emissions regulated
    under the Clean Air Act. New construction projects will likely
    be significantly delayed because there is no clarity in how to
    address greenhouse gases and PDS permits. EPA's failure to
    provide the necessary tools, information and direction will
    lead to permits being delayed and complex legal challenges to
    permits.
        The Clean Air Act simply is not designed to address
    greenhouse gas emissions. The policy to limit greenhouse gas
    emissions should be set by Congress. Setting a path forward
    regulating greenhouse gas emissions under the Clean Air Act
    would stifle an already slow permitting process, raise costs,
    limit economic development and industrial growth around our
    country at a time when we need jobs the most.
        EPA also plans to adopt numerous new rules over the next
    few years including coal ash, maximum available control
    technology standards, cooling water intake rules, air quality
    standards for ozone, lead and particulate matter. Individually,
    they represent sizable cost impacts. Together, they could be
    enough to significantly curtail the economic development and
    force many premature closings of low-cost, reliable power
    facilities that keep our Nation running.
        I support Chairman Upton's proposal that would remove
    regulation of greenhouse gases from Clean Air Act. The secret
    to success is a balanced and thoughtful approach that factors
    in the cost impacts of these proposed regulations to customers.
        Thank you for this opportunity and for your attention, and
    I am happy to answer any questions you may have.
        [The prepared statement of Mr. Carter follows:]

        [GRAPHIC] [TIFF OMITTED] T5734.181

        [GRAPHIC] [TIFF OMITTED] T5734.182

        [GRAPHIC] [TIFF OMITTED] T5734.183

        [GRAPHIC] [TIFF OMITTED] T5734.184

        [GRAPHIC] [TIFF OMITTED] T5734.185

        [GRAPHIC] [TIFF OMITTED] T5734.186

        [GRAPHIC] [TIFF OMITTED] T5734.187

        [GRAPHIC] [TIFF OMITTED] T5734.188

        [GRAPHIC] [TIFF OMITTED] T5734.189

        [GRAPHIC] [TIFF OMITTED] T5734.190

        [GRAPHIC] [TIFF OMITTED] T5734.191

        [GRAPHIC] [TIFF OMITTED] T5734.192

        [GRAPHIC] [TIFF OMITTED] T5734.193

        [GRAPHIC] [TIFF OMITTED] T5734.194

        [GRAPHIC] [TIFF OMITTED] T5734.195

        Mr. Whitfield. Thank you very much.
        Ms. Blaisdell, you are recognized for 5 minutes.

                     STATEMENT OF BETSEY BLAISDELL

        Ms. Blaisdell. Thank you. Good afternoon, Chairman
    Whitfield, Ranking Member Rush and distinguished members of the
    subcommittee. I appreciate the opportunity to testify at
    today's hearing. I am here on behalf of the Timberland Company,
    which produces boots, clothing and gear for the outdoors.
        I am also here on behalf of BICEP, which stands for
    Businesses for Innovative Climate and Energy Policy. We are a
    group of major consumer household brand companies such as Nike,
    Starbucks, Levi Strauss and Co., Best Buy, Target, Symantec,
    Gap, Aspen Ski Company. Timberland and the other BICEP
    companies believe that we need strong energy and climate
    policies to protect our supply chain, ensure market certainty
    as well as to help create jobs, level the playing field among
    businesses, enhance economic development and ensure global
    competitiveness as we move into the future.
        While we prefer congressional action to executive branch
    regulation, the latter is necessary when Congress leadership is
    lacking. Current EPA regulations as well as those under
    development would help protect our economy as well as human
    health and the environment.
        Mr. Chairman, we couldn't agree more with a couple of
    statements you made in your press releasing highlighting your
    premises for introducing the legislation that is the topic of
    today's hearing. That is, number one, Congress, not EPA
    bureaucrats, should be in charge of setting America's climate
    change policy, and secondly, a 2-year delay of EPA's cap-and-
    trade agenda provides no meaningful certainty for job creators,
    fails to protect jobs and puts decision-making in Congress on a
    critically important economic issue past voters and the
    election year.
        Indeed, Congress should be setting America's climate
    policy, and the 2-year delay would create more uncertainty and
    lead to other problems, as you correctly point out. I will come
    back to these points in a moment.
        You are probably wondering why Timberland and the other
    BICEP companies care about climate and energy policies. We care
    because our supply chains are affected by current and projected
    climate impacts while materials for Timberland products as well
    as Levi and Gap jeans, Nike Sneakers, Starbucks coffee
    plantations, they all depend on water. If there is less water
    due to the projected climate change impacts, we all struggle to
    produce our products and meet the demands of our consumers and
    we will continue to suffer as weather events grow in severity
    and frequency, which interrupt our ability to move products to
    consumers. This costs us both time and money. Moreover, and
    this is very important, our employees and consumers are
    demanding that we take actions to reduce greenhouse gas
    emissions.
        For a global company, addressing climate change is no small
    task. We need policies hat will create long-term market
    certainty that parallels our planning timelines. I realize some
    entities want no action at all. However, many more companies
    recognize that we need to act to address this critically
    important economic issue we are facing right now, and acting
    sooner rather than later is more prudent and cheaper in the
    long run and will help avoid the worst potential projected
    impacts and hopefully help avoid more costly scenarios down the
    road that might occur if we do nothing in the near term.
    Failure to act would be more costly to our businesses and
    consumers down the road. Thus, for Timberland and other BICEP
    companies, acting to address climate change is a business
    imperative.
        Timberland is taking steps to be a leader in
    sustainability. In 2006, we actually voluntarily capped our own
    greenhouse gas emissions. Since then we have reduced our
    emissions for our facilities and operations by more than 40
    percent, which has saved us over $1 million a year, which is a
    significant savings for a company like ours during this tough
    economy. Investing in renewable energy in States like
    California has proven to be an effective hedge for rapidly
    rising utility costs. Energy efficiency in our corporate
    facilities and stores has cut energy consumption by more than
    30 percent with a payback of under 2 years, usually under one.
    Nutrition labels on our product communicate our progress to
    consumers. These labels combined with Earthkeepers footwear,
    which is designed to have a smaller climate impact, have helped
    drive remarkable growth while many of our competitors have
    struggled to survive.
        In your home State of Kentucky, Mr. Chairman, after several
    years of conversation with the local utility, we finally
    negotiated a deal to source electricity from a certified small-
    scale hydropower facility on the Kentucky River. We pay a
    premium for that power, but the benefits far outweigh the
    costs. Our climate impact is dramatically reduced and the local
    community benefits from having an emissions-free renewable
    source of power that is a scenic learning lab for children in
    and around Danville.
        While Congress could be creating America's climate policy
    and while most businesses prefer this route, because Congress
    has failed to do so, we must fall back on EPA's authority and
    regulations. Preventing EPA from exercising its authority or
    rolling back any of its actions would cost the economy in human
    health in terms of illness and often results in lost work days
    and more. More specifically, in 2005 alone the Clean Air Act
    protections helped avoid 13 million lost work days, thereby
    helping maintain our Nation's economic productivity.
        On the second point in your press release, again, we agree,
    a 2-year delay on EPA's regulation of greenhouse gas emissions
    would enhance uncertainty in the marketplace and hinder job
    creation as well as delay critical decisions that Congress
    should in fact be making. So rather than going after EPA's
    ability to regulate including repealing a number of its current
    actions, Congress should act responsibly and develop sound
    energy and climate policy. Some of America's largest businesses
    stand ready to work with you, to work with Congress to develop
    responsible policies in this area. In lieu of such action,
    however, EPA must be allowed to do its job, and let me
    reiterate, we would like to be here. Many U.S. businesses
    including the BICEP companies in fact do prefer EPA regulation
    to no protections at all, as I previously mentioned.
        I look forward to constructive policy debates moving
    forward that focus on the best ways in which businesses can
    work with you to develop sound energy policies, policies with
    which many business would resoundingly agree. Let us work on a
    bipartisan basis to produce sound energy policies we can all be
    proud of and which virtually everyone on and off Capitol Hill
    recognize will help move us toward a better path for job
    creation, economic growth and global competitiveness.
        Thank you, Mr. Chairman.
        [The prepared statement of Ms. Blaisdell follows:]

        [GRAPHIC] [TIFF OMITTED] T5734.196

        [GRAPHIC] [TIFF OMITTED] T5734.197

        [GRAPHIC] [TIFF OMITTED] T5734.198

        [GRAPHIC] [TIFF OMITTED] T5734.199

        [GRAPHIC] [TIFF OMITTED] T5734.200

        [GRAPHIC] [TIFF OMITTED] T5734.201

        [GRAPHIC] [TIFF OMITTED] T5734.202

        [GRAPHIC] [TIFF OMITTED] T5734.203

        Mr. Whitfield. We have two votes on the House floor. We
    have about 3 minutes left to vote, so we are going to go over
    there. We are going to take a break and hopefully be back by
    2:00 and then we will get to the questions and then we will go
    right to the third panel. So why don't you all go have a glass
    or lemonade or something.
        [Recess.]
        Mr. Whitfield. I would like to call the hearing back to
    order, please, and I am very sorry you all had to wait a little
    bit longer while we finished these votes, but I want to thank
    you for your testimony, and I will start off with questioning
    here and then we will go on down the line.
        First of all, Mr. Rowlan, I just want to follow up one
    thing. You mentioned something about $52 million a year in
    additional costs in renewable mandate States versus non-
    renewable mandate States. Would you clarify that for me one
    more time?
        Mr. Rowlan. I was speaking to a business group, and I was
    showing the impact of a renewable energy standard on their
    utility rates, which is something that concerns us
    significantly.
        Mr. Whitfield. Right.
        Mr. Rowlan. Economical power is the lifeblood of industry,
    and I looked at several northeast States and some other States
    scattered throughout the country that had an RES standard, and
    then I compared that with, I think it was South Carolina and
    Arkansas without an RES standard, took the average commercial
    rate that we would have been charged, and the difference from
    the high end to the low end was $52 million annually.
        Mr. Whitfield. Wow.
        Mr. Rowlan. And that is just for the average amount of
    power for what we would be considered a medium-sized facility
    for us.
        Mr. Whitfield. Well, I know in Kentucky we do not have a
    renewable mandate, and our electricity rates are around 7 cents
    per kilowatt hour, which is pretty good. But you point out a
    good issue because the key for the United States and our
    growing economy is to maintain a global competitiveness, be
    competitive in the global marketplace, and if we unilaterally
    start adopting some of these rules like Ms. Jackson has on
    greenhouse gases, which even she admitted is not going to have
    any dramatic impact on greenhouse gases, and other countries
    are not taking any action, so it is really putting us at a
    disadvantage.
        Ms. Blaisdell, I know that you support her actions, and you
    came up and we talked a little bit about Danville, Kentucky. Do
    you all have a plant in Danville, Kentucky?
        Ms. Blaisdell. We have a distribution center.
        Mr. Whitfield. Oh, a distribution center. How many plants
    do you all have in the United States?
        Ms. Blaisdell. Are you talking about how many facilities or
    how many----
        Mr. Whitfield. Where you actually make the product.
        Ms. Blaisdell. We do not own a manufacturing plant in the
    United States. Most of the products that we manufacture come
    from factories we outsource from.
        Mr. Whitfield. From which countries?
        Ms. Blaisdell. All over the world. We do source from the
    United States as well.
        Mr. Whitfield. Oh, okay.
        Ms. Blaisdell. We just don't own any in the United States.
        Mr. Whitfield. Oh, okay. Well, time is running out here,
    but I just want to summarize in my view what Ms. Jackson said.
    She placed a lot of emphasis on the importance of certainty,
    and she also placed a lot of emphasis on being reasonable, and
    I really find myself puzzled by that because she also said
    really there is no technology available to control greenhouse
    gases, and then she said so the only thing we can do is that we
    can deal with efficiency, and then our friend Mr. Doyle from
    Pennsylvania said well, that seems perfectly reasonable, but in
    my view, companies are going to try to be as efficient as they
    can be in order to compete in the marketplace, and basically
    what we are doing here is, we are having government bureaucrats
    go in and say this is what you need to do to be efficient. And
    even if the State implementation plan or State enforcers say
    you do this, this and this to be efficient, there is not
    anything to preclude EPA from coming back and overruling them
    or changing it or whatever. And then you get to under the
    preventing significant deterioration the best available control
    technology, and it is my understanding that the State
    implementers or State regulators could conceivably even require
    you to switch your fuel; instead of coal or oil or natural gas,
    whatever, we want you to use wind power, that there was not
    anything in there that would prohibit that.
        And I just find it almost impossible to believe that she
    would refer to that as being certain, there is certainty here,
    and so the business people like that. I mean, the real issue
    is, we have a high unemployment rate. We are trying to compete
    in the global marketplace. We do want certainty, and in my
    view, there is not any way--at least she did say this. She said
    we have to have coal, for example, and natural gas and nuclear
    and all of that because as I said in my opening statements, our
    energy demands are going to double by the year 2035. And so I
    am assuming you all would agree with what I am saying. Ms.
    Blaisdell may not agree. Yes, sir.
        Mr. Rowlan. I will give you a real interesting example. We
    heat our steel up to roll it into a shape, and that is called a
    reheat furnace, and the Clean Air Act BACT for the burners in
    that is what is called reduce NOx or low
    NOx burner, which requires us to actually be less
    efficient. We actually limit the heat on it so that we create
    less NOx. So we are using more energy in order to
    keep NOx down. As we get into a greenhouse gas rule,
    are faced with the exact opposite of that. We are tied up in,
    do you raise NOx so that you lower CO2 or
    do you raise CO2 so that you keep NOx
    down. And that is the paradox that we are in.
        We also are caught up with that in CO, our CO emissions.
    Typically we put some oxygen with them as they come out of our
    furnace and convert them to CO2 so now if we limit
    our CO2 by not putting the oxygen in and burning it
    off afterwards, we are going to raise our CO, which is a
    criteria pollutant. So there is a lot of really difficult
    questions that would have to be asked if this were to go
    forward under the Clean Air Act, and frankly, I don't think
    some of the people are prepared to give us answers on it or
    make the decision.
        Mr. Whitfield. Right. Well, I agree with you.
        Mr. Rush, I will recognize you for 5 minutes.
        Mr. Rush. Thank you, Mr. Chairman.
        Attorney General Abbott, first of all, I want to
    congratulate you on some of the standards and your activities
    and your accomplishments as it relates to alternative energy. I
    understand from your testimony that your State is number one in
    the use of wind energy, and I certainly want to congratulate
    you and your State for those efforts. I know that you have a
    cheerleader here in Mr. Barton and so I am not going to
    congratulate you too much because I don't want to take some of
    his thunder away from.
        Suffice it to say that in spite of scholarly debates over
    the proper standards of judicial review of agency action or
    inaction under section 706 of the APA, in light of the Chevron
    Doctrine, the federal courts including the Supreme Court have
    been deferential to an agency's statutory interpretation where
    those interpretations are reasonable. This Chevron level of
    deference exceeds even the level of deference an appellate
    court must accord to trial courts under the de novo standard.
    De novo can be triggered when trial courts interpret laws like
    the Clean Air Act. Can you explain how the Supreme Court, that
    the outcome is wrong in the Massachusetts v. EPA decision? Were
    they deferring to the EPA's interpretation? Can you explain why
    and how the Supreme Court got it wrong?
        Mr. Abbott. Will I explain how the Supreme Court got it
    wrong?
        Mr. Rush. Yes, your interpretation, from your point of
    view, how is the Supreme Court's decision wrong?
        Mr. Abbott. Well, I think the Supreme Court decision is
    wrong because I don't think that it requires the EPA to
    regulate greenhouse gases but the fact of the matter is, I
    think under the Supreme Court's decision, it still did not
    mandate that the EPA must conclude that greenhouse gases pose
    an endangerment and it still provided certain other latitude
    for operating room for the EPA to operate as has been discussed
    in testimony throughout the course of the day.
        Mr. Rush. So are you saying that they were wrong because
    they did not mandate it? Is that what is wrong with the Supreme
    Court decision?
        Mr. Abbott. Well, yes.
        Mr. Rush. The reason why I ask that question is because you
    say on page 7 of your testimony that in Massachusetts v. EPA,
    the Supreme Court said it need not and does not reach the
    question whether carbon dioxide is the kind of air pollutant
    the EPA must regulate under the Clean Air Act, but my copy of
    the Supreme Court's decision says something a little different.
    I will bring your attention to section 7, paragraph 2 on page
    32. It says, ``In short, the EPA has offered no reasoned
    explanation for its refusal to decide whether greenhouse gases
    cause or contribute to climate change. Its action was therefore
    arbitrary, capricious or otherwise not in accordance with
    law.'' This is the matter that I am referring to. ``We need not
    and do not reach the question of whether on remand EPA must
    make an endangerment finding or whether policy concerns can
    inform EPA's action in the event that it makes such a
    finding.'' So you said that they did not and they are saying
    something altogether different.
        Mr. Abbott. Actually what I am hanging my hat on is that
    very sentence that you read, and I may have articulated
    inappropriately but what I meant to articulate is exactly word
    for word what that sentence says.
        Mr. Rush. OK. All right.
        Mr. Abbott. And that is that they basically don't reach the
    question whether or not the----
        Mr. Rush. But you conclude that----
        Mr. Abbott [continuing]. EPA must----
        Mr. Rush. But you are concluding that the Supreme Court was
    somehow wrong? I don't understand. I am trying to----
        Mr. Abbott. I disagree with the Supreme Court's ruling but
    it is the Supreme Court's ruling, and so we must operate under
    it.
        Mr. Rush. Thank you.
        Mr. Rowlan, on Friday EPA--no, that is quite all right, Mr.
    Chairman. I yield back.
        Mr. Whitfield. I recognize Mr. Upton of Michigan for 5
    minutes.
        Mr. Upton. Thank you again, Mr. Chairman. I regret I wasn't
    here for many of your presentations. We have another
    subcommittee that is meeting at the same time and so a number
    of us were there, and as you know, we had votes on the House
    floor as well.
        In the previous panel, I talked about the impact on
    Michigan with the job impact. In fact, there has been
    independent study that showed that Michigan's GDP would drop by
    $18 billion, destroy 96,000 jobs, reduce household incomes by
    nearly $1,600, and the concern that many of us have is if we
    allow EPA to pursue these regulations, we would have added
    cost. We heard from your testimony in terms of the impact on
    you all but I just wonder if you can summarize for me from your
    individual and somewhat unique perspective, I know it will be
    tougher for Illinois Farm Bureau because I don't know where
    those farmers--you are not going to go someplace else, you are
    going to keep the land there in Illinois, I would imagine. But
    as it relates to your industry, if these regulations are
    imposed, where do you think things are headed for your
    particular industry as it relates to the jobs that are
    provided? Are they going to go to India and China? Are they
    just going to close down? What is your individual opinion in
    terms of what will happen to the groups of similar industries
    as it relates to us having these regulations and not having
    them in other places around the world?
        Mr. Alford. Yes, sir. There is definitely going to be a
    transfer of wealth. I think there is a national security issue
    here where we Americans are number one in the world
    economically now but we could go to sixth, seventh, eighth, or
    ninth, and if we go to ninth, we are vulnerable to new enemies
    who look at us as someone who could be taken over, and I think
    we are at a fork in the road here. We better take the right
    way, and I think the EPA view or attitude towards the American
    worker is that of a pawn on a chessboard: expendable and no
    need to worry. I think that is a terrible attitude.
        Mr. Rowlan. I would say that it is already happening. I
    hear a lot of people ask for examples of companies going
    overseas. I explained it this way one time to some economic
    development people when EPA said that non-attainment would not
    impact them, and EPA said we have never heard of a company
    picking up and leaving an area because it was non-attainment,
    and I said that is because you don't even make the first cut.
    You are cut out and you are excluded, and that is what this
    lack of decisiveness and this constant 2 years, 1 year, when is
    this coming, when is this rule hitting, when is PM 2.5, when is
    ozone. That constant barrage causes you to take your capital
    and move someplace where you have got a level of certainty.
    This facility that I have worked on in Louisiana, in the time
    it has taken me to not completely get a permit, a full facility
    of that size has been constructed, permitted and is operating
    in China.
        Mr. Cousins. When I first started working in the refining
    industry, there were about 350 U.S. refineries. Today there are
    about 150. There hasn't been a single refinery built in this
    country in 30 years. There have been many built in the Pacific
    Rim, China, India. I mean, there is no guesswork. That is what
    is going to happen.
        Mr. Carter. I would turn your attention really to two
    areas. One is, as I have had the opportunity to meet with CEOs
    in a class actually for a weeklong class where the majority or
    the vast majority, out of 25, I think only six of us were U.S.
    citizens, which probably should be very telling in itself, and
    one of the things I learned from that group, much to my dismay,
    was just how they look down on us and when they look at making
    investments because of our permitting process and the fact that
    is lengthy and litigious and very poorly defined as it relates
    to almost every aspect of the way you permit a new plant, which
    makes us very uncompetitive, and what I have put in my
    testimony today is just another example of that, not just
    limited to what we deal with with EPA.
        A good solid example as it relates to what we are dealing
    with here is the issue over biomass. As I indicated in my
    testimony, we have contracted for a number of biomass
    facilities but they are having difficulty getting financing for
    those projects because they don't know what the permitting
    requirements are going to be for their facilities. Now, that is
    real. That means those jobs aren't going forward.
        Mr. Upton. And I know my time is expired so that just means
    why we need a real decision which this draft legislation does
    versus a simple extension where you sit on pins and needles. I
    yield back my time.
        Mr. Whitfield. Mr. Inslee for 5 minutes.
        Mr. Inslee. Thank you. Mr. Rowlan, thank you for being here
    with Nucor. We have a facility in Seattle. You run a very
    efficient business. You have found ways to make steel with
    great efficiencies. I will compliment you on that, and that is
    all this proposed regulation does for power companies was to
    ask them to be efficient like Nucor has been, the kind of
    decisions you have made to make cost-effective investments in
    efficiency. You have done that at Nucor. All this regulation
    does is ask utilities to do the same thing. That is why eight
    major utilities wrote a letter to the Wall Street Journal last
    month urging the adoption of these regulations so that they
    could have certainty so that they could move forward.
        I want to talk about this Dirty Air Act and bring it to
    real life. I want to show a brief video of an 11-year-old young
    lady named Megan Foster from North Carolina. She is a child
    with asthma who is a very, very fast runner but has difficulty
    when her asthma is triggered, which we know can be done by
    ozone. Can we just play this clip briefly, and then I want to
    ask you gentlemen a question.
        [Video shown.]
        Mr. Inslee. Thank you. Now, the Environmental Protection
    Agency pursuant to law and the U.S. Supreme Court and common
    sense has fulfilled their obligation to people like Megan to
    try to protect her and millions of other kids from pollutants
    that exacerbate asthma, and we are here today to consider a
    bill that would eliminate the ability of the Environmental
    Protection Agency to help children like Megan Foster, and I
    would like to know about your views and what science you can
    present to us about this issue. The EPA has determined that the
    science shows that pollutants, carbon dioxide and a variety of
    other climate-changing gases, have the capacity to injure human
    health including gases that exacerbate asthma including
    exacerbating ozone conditions.
        So I just want to quickly go down the road and ask you if
    you can present to this committee a single peer-reviewed
    scientific journal that shows that these gases that are subject
    to this regulation do not result in damage to human health
    associated with climate change, and if you give us a yes or no,
    if you say yes, I am going to ask you what it is. But let us
    just first go down yes or no. Mr. Abbott, do you have a single
    peer-reviewed study like that?
        Mr. Abbott. I haven't conducted that research.
        Mr. Inslee. Do you know of any, anywhere in the world?
        Mr. Abbott. I haven't looked into it.
        Mr. Inslee. Thank you. Mr. Alford?
        Mr. Alford. I haven't looked. Don't know.
        Mr. Inslee. Mr. Rowlan?
        Mr. Rowlan. I am not aware of it.
        Mr. Inslee. Mr. Pearce? Thank you.
        Mr. Pearce. I'm not aware.
        Mr. Inslee. Mr. Cousins?
        Mr. Cousins. No.
        Mr. Inslee. Mr. Carter?
        Mr. Carter. No.
        Mr. Inslee. Ms. Blaisdell?
        Ms. Blaisdell. No.
        Mr. Inslee. Now, I think this is pretty intriguing because
    this story gets written like ``he said, she said'' stuff by the
    press all the time. He said these gases are bad, these changes
    change the climate, she said they didn't, or in this case
    ``he'' meaning Senator Inhofe. It is time to start writing the
    truth about the science on this issue.
        You gentlemen that represent the effort to repeal the Clean
    Air Act and pass the Dirty Air Act can't produce one single
    peer-reviewed scientific journal, and you are asking the United
    States Congress to eliminate the ability of the Environmental
    Protection Agency to protect kids like Megan Foster. Now, I
    think that is preposterous that you would come in and ask us to
    do this without presenting some science to us. Now, if you can
    find some, you can send it to me. I am interested in it. I have
    looked for it, so have the scientists that we have hired to do
    this including those at the U.S. Navy, and you know what? They
    can't find any because there is none, and I just hope that we
    eventually will do what the law requires, which is to follow
    science and protect the Megan Fosters of the world and do a
    very commonsense thing, which is to do just what Nucor Steel
    has done and that is about the efficiencies in the utility
    business, and if we do that, we are going to do some good
    things.
        Thank you. I would yield back.
        Mr. Whitfield. I recognize the gentleman from Texas for 5
    minutes.
        Mr. Barton. Thank you.
        I hate to take up too much of my 5 minutes but I have got
    to respond to what my good friend from Washington just said.
    CO2 is not an irritant for asthma. My good friend
    just asked if there was any peer-reviewed science that showed
    the negative. There is no peer-reviewed science that shows the
    positive, okay? Now, CO2 is a component of ozone,
    and ozone is a regulated criteria pollutant under the Clean Air
    Act, but if you are intolerant to ozone, you are going to be
    intolerant to ozone at one part per billion. If you are not
    ozone intolerant, you can be subjected to a thousand parts per
    billion and not be affected, and there is just as much
    scientific evidence that asthmatics are much more affected by
    rat feces and roach infestments in tenements as there is of the
    actual air quality. So it may be politically correct to show a
    figure of a young, innocent asthmatic child. My son when he was
    growing up was asthmatic, so I know a little bit about this
    from a personal perspective.
        But to use that and then somehow say that what we are
    trying to do here in protecting the American economy and
    keeping jobs in America is somehow going to hurt the public
    health is just flat not true. We are not changing one standard
    in the Clean Air Act. We are not changing the definitions of
    the criteria pollutants. We are simply rectifying a 5-4
    decision of the U.S. Supreme Court that gave the EPA the right
    to look at CO2 if they wanted to. The Obama
    Administration wanted to. They put out their endangerment
    finding, which I think is fatally flawed, and the result is, we
    are trying to do the legislative intent which is clarify what
    the Clean Air Act actually meant. If Chairman Upton and
    Subcommittee Chairman Whitfield want to come back at a later
    date and regulate CO2, they will put that bill
    before the subcommittee and the full committee. But first let
    us make sure that we express the will of the people through the
    Constitutional authority that we have on CO2.
        Now, I want to go to Mr. Abbott, the great Attorney General
    from the State of Texas. You are the chief law enforcement
    officer of the state. Is that correct?
        Mr. Abbott. Yes, sir.
        Mr. Barton. And I know you are not a clean air expert but
    you are knowledgeable about it. There are six criteria
    pollutants under the Clean Air Act. Is the State of Texas
    noncompliant on lead anywhere in the State?
        Mr. Abbott. Not that I know of.
        Mr. Barton. Are they noncompliant in SO2
    anywhere in the State?
        Mr. Abbott. Not that I know of.
        Mr. Barton. Are they noncompliant on nitric oxide anywhere
    in the State?
        Mr. Abbott. Not that I know of.
        Mr. Barton. Are they noncompliant on carbon monoxide
    anywhere in the State?
        Mr. Abbott. Not that I know of.
        Mr. Barton. Are they noncompliant anywhere in the State of
    Texas on particulate matter?
        Mr. Abbott. Not that I know of.
        Mr. Barton. Now, ozone, they are in non-attainment ozone.
    Where are the three areas in Texas that are noncompliant for
    ozone?
        Mr. Abbott. I am not sure.
        Mr. Barton. Well, I do. I know. Houston is in
    noncompliance, Port Arthur is in noncompliance, and the Dallas-
    Fort Worth area is in noncompliance under the new standard.
    Now, under the Clean Air Act of 1992 or 1990, the EPA put out
    regulations for air quality that Texas began to comply with,
    and since that time Texas has issued over 100 permits to
    private industry in Texas. They all got invalidated in December
    of this year. Is that not correct?
        Mr. Abbott. That is correct.
        Mr. Barton. Were they invalidated because they were in
    noncompliance for any of these criteria pollutants including
    ozone?
        Mr. Abbott. No.
        Mr. Barton. Why were they invalidated?
        Mr. Abbott. Well, they were invalidated because of the SIP
    call and FIP calls that were issued by the EPA.
        Mr. Barton. So they were invalidated because the EPA
    changed their mind or just didn't like the way Texas was doing
    things?
        Mr. Abbott. They were invalidated because the EPA basically
    took over the Texas air permit system.
        Mr. Barton. They took over, but they didn't take it over
    because we are in noncompliance?
        Mr. Abbott. Correct.
        Mr. Barton. OK. Has EPA alleged that we are in
    noncompliance?
        Mr. Abbott. Not that I am aware.
        Mr. Barton. I am not aware of that either. So there are two
    issues with regards to what is happening in Texas. One is
    compliance with the existing Clean Air Act, and we have just
    shown that with the exception of ozone in three areas, we are
    in compliance. The other is, these new greenhouse gas
    regulations. Why has the State refused, or maybe I should say
    what has the State of Texas done with respect to the EPA
    mandate on these new CO2 regulations?
        Mr. Abbott. Well, I can tell you from the legal
    perspective. I can't tell you from the TCEQ perspective.
        Mr. Barton. Well, tell me from the legal perspective.
        Mr. Abbott. From the legal perspective, there are basically
    six different rulings that were made by the EPA, and as a
    result there are six different legal actions filed by the State
    of Texas in response. One involves the endangerment finding.
    Another involves the tailoring rule. Another involves the
    timing rule. Another involves the tailpipe rule, and one
    involves the SIP call and the sixth would involve the FIP call.
        Mr. Barton. I will ask the rest of my questions in writing.
    Thank you, Mr. Chairman.
        Mr. Whitfield. Yes, sir.
        Mr. Green, 5 minutes.
        Mr. Green. Thank you, Mr. Chairman. I would like to welcome
    our panel and particularly our Attorney General. You will all
    have a little different questions from this side of the aisle
    but you at least have the same Texas accent that Joe and I
    have.
        I want to welcome you to the committee, and we heard, the
    topics we are discussing today at the hearing are complicated
    and these are a wide range of views. Some of our views are
    similar, and neither of us believes that the EPA regulation of
    greenhouse gases is the right solution to our energy and
    climate change challenges. We are both interested in improving
    the economy and creating jobs, specifically keeping those jobs
    in Texas. I would like to talk to you about an area where our
    views may diverge a little bit. On December 23rd, EPA issued an
    interim final order that allowed EPA to assume responsibility
    for the Texas air permit program with regard to greenhouse
    gases. EPA has stated it took the action because under your
    guidance, the State of Texas indicated it would not include
    greenhouse gas and emissions pollution in air permits. Is that
    correct? Was it only greenhouse gases?
        Mr. Abbott. Would you state the predicate again?
        Mr. Green. Texas took this action and indicated it would
    include greenhouse gas emissions pollution in the air permits.
        Mr. Abbott. Right.
        Mr. Green. And it is my understanding that Texas is the
    only State that refused to modify its air program. Is that
    true?
        Mr. Abbott. That is my understanding.
        Mr. Green. That the other 49 States, including some who are
    suing the EPA like Texas is over the endangerment finding, have
    taken some action to move forward to comply with the new
    requirements.
        Mr. Abbott. Well, I can't be clear about what the other
    States are doing. Here is my understanding, and that is the EPA
    sent out a letter requesting responses from all the States.
    Many States responded. Maybe some States said they would go
    along. I can't guarantee you that all States responded and all
    States said they would comply. Texas is the only State that
    made clear that we would not comply with the greenhouse gas
    regulations.
        Mr. Green. I think, at least our information is the other
    49 said yes, they would, and believe me, I explained to people,
    we are up here all the time about American exceptionalism
    issues worldwide. Come to Texas and we will explain to you
    Texas exceptionalism, and that is something we all have.
        Mr. Abbott. I could make clear, Texas is not the only State
    that is challenging the EPA's greenhouse gas regulations.
        Mr. Green. That is true. Yes, there are a number of States
    that are filing suit. Given your position, I understand the
    consequences would have been if EPA had not assumed
    responsibility for these air permits, if Texas wasn't willing
    to start it, even though the lawsuit is filed and that is the
    way you do it, you go to the courthouse, and for decades the
    Clean Air Act has required certain sources to obtain air
    permits before construction begins on a new facility. These
    permits, called PSD permits, were required to start building.
    My question is, would it be legal to build a facility without
    one of these permits when the law requires it? So if Texas was
    not enforcing it--I have the Houston ship channel. I have five
    refineries and more chemical plants than I can count. My
    concern was, Texas is not enforcing it. If we wanted to expand
    those plants, and thank goodness over the last 15 years most of
    the plants have been expanded, that we would not without having
    a permit processed whether it is through the State of Texas
    enforcing a regulation that they don't agree with and going to
    court or the EPA taking over those air permits. Is that
    generally what would happen?
        Mr. Abbott. Well, I think generally what you are saying may
    be true. This is outside my area of expertise. However, what I
    think is that had the EPA not issued the SIP and FIP calls, it
    is my understanding Texas would have been able to continue on
    with the permitting process.
        Mr. Green. Well, we will figure that out, but my concern
    was that if Texas would not do it--and I have plants that are
    always in the process of trying to expand. And you know how
    competitive the chemical industry is, for example, that, you
    know, if they are trouble with--if they are not going to build
    a facility in East Harris County if they are worried they won't
    have that permit available, you know, pr they won't be able to
    get permission to build it, they would build it someplace else
    and ship those chemicals back to us. That is where I don't mind
    going to the courthouse. That is what a lot of us did for a
    living. I just worry that I don't want to put my plants at a
    disadvantage because of the battle between the State and EPA.
        Mr. Abbott. Right.
        Mr. Green. That is my concern.
        Mr. Abbott. I want to make clear that we stand foursquare
    with you on that proposition. We want the businesses in your
    district as well as the businesses across the State of Texas
    not to be at any disadvantage whatsoever. We want to make sure
    they have access to the permits they need in order to operate
    their business. We want to make sure that we continue to
    attract jobs to the great Houston and Texas area but, as you
    know. Texas has done a better job of creating jobs than all of
    the other States in the country. One reason why we have been so
    successful in that regard is because Texas has a more
    reasonable regulatory system and has not had to deal with every
    evolving changing rule like what they are seeing coming out of
    the EPA now.
        Mr. Green. I am out of time and I know the Chair is going
    to gavel me, but I served 23 years in the legislature, and we
    always enforced our clean air permits even when I was there
    based on the EPA saying the State of Texas could enforce it. We
    always had to jump through hoops from the Federal Government,
    you know, 18 years ago and 20 years before that, and I know it
    is frustrating but EPA has had that authority over Texas I know
    for the last 38 years.
        Thank you, Mr. Chairman.
        Mr. Whitfield. Mr. Shimkus, 5 minutes.
        Mr. Shimkus. Thank you, Mr. Chairman. The full committee is
    named the Energy and Commerce Committee, so our focus is energy
    issues and commerce issues. The Democrats who want to make this
    into a science argument ought to go to the Science Committee.
    That is why we have a Science Committee. If they want to debate
    science, go to the Science Committee. We want to talk about
    energy. We want to talk about commerce. That is why I hold up
    my coal miners. One thousand of them in one mine, 1,000 coal
    miners in one mine lost their jobs. This is replicated in
    Illinois, 14,000, State of Ohio, 35. These are real job losses.
    If you want to talk about public health, the worst thing you do
    for public health is not have a job and be poor and in poverty.
    The best thing for human health is to have a job and maybe a
    job that provides health care, although we are attacking that
    too in those provisions.
        So this hearing is focusing on jobs, and as I laid out in
    the previous panel that when you raise energy costs, you hurt
    the ability to create jobs and sustain jobs. I do believe in
    supply and demand. I do believe that if more capital is
    required to produce that electricity that cost gets passed on.
        Now, it is curious that Ms. Blaisdell is here, and I have
    your testimony, and you are not only here with respect to
    Timberland but also BICEP. Is that correct? And BICEP is the
    Business for Innovative Climate Energy Policy, so you all like
    this climate debate, right? I mean, you are supporting----
        Ms. Blaisdell. Sir, we don't like climate change. We are
    here to support aggressive legislation.
        Mr. Shimkus. OK. Right. So you would have supported Waxman-
    Markey, putting a price on carbon and addressing climate.
        Ms. Blaisdell. We support addressing climate.
        Mr. Shimkus. Great. OK. Now, it is curious that you and
    these folks do that because in articles in May 2002, many
    companies that are in this Business for Innovative Climate and
    Energy Policy, guess where your products are produced? China. I
    will quote this article May 9, 2002: ``While companies such as
    Gap, Guess, and Ralph Lauren have long farmed out production
    overseas in China,'' also Levis they mention here. Now, your
    company is not immune from this. In an article by Business
    Daily Update, except for your answering to the question, March
    27, 2006, article is, ``Unbeknownst to many''--talking about
    Timberland--``actually operated 45 factories throughout the
    country since the 1990s.'' Forty-five factories throughout the
    country, that country being China. So wouldn't it be to your
    advantage to force higher utility rates on manufacturers in
    this country while taking advantage of low power rates in China
    along with low labor rates, along with low environmental
    standards? In fact, following up on an article August 7, 2009,
    on Timberland, who you represent, ``Two mainland suppliers of
    outdoor clothes manufacturer Timberland have consistently
    breached environmental regulations, two NGOs said yesterday.''
    This is Chinese environmental regulations. You have to be
    pretty bad to violate Chinese environmental regulations.
        Now, I find it just incredible that you would come here
    supporting hard action on climate change, raising the cost of
    doing business while your production is in these very same
    countries that will never comply, do not pay the same wage
    rate, and do not have any environmental standards, and I am
    glad that the Minority asked you to come because it highlights
    the hypocrisy of this debate, that you can stand here and you
    can call for increased regulations and costs while your company
    outsources manufacturing and we don't have jobs, and with that,
    Mr. Chairman, I yield back my time.
        Mr. Whitfield. Thank you, Mr. Shimkus.
        Ms. Blaisdell. May I please reply?
        Mr. Whitfield. I want to ask unanimous consent that we
    enter into the record at this point, these are documents
    relating to Mr. Waxman's introducing into evidence the Stephen
    Johnson issue on the endangerment finding, and these are the
    complete set of documents from the government, and then I
    understand Mr. Inslee had a document he would like to enter
    into the record.
        Mr. Inslee. Yes. Thank you. I just would like to introduce
    two documents. One is actually the endangerment finding that
    reads, ``Climate change is expected to worsen regional ground-
    level ozone pollution. Exposure to ground-level ozone has been
    linked to respiratory health problems ranging from decreased
    lung function and aggravated asthma to increased emergency
    department visits, hospital admissions and even premature
    death.'' That is one. The second is this letter I referred to
    in my questioning from 1,800 doctors, and the third is
    testimony by Dr. Mark Jacobson of Stanford, who presented
    testimony in April to the Select Committee that specifically
    addressed the health impacts of CO2 on respiratory
    illness. Thank you, Mr. Chair, for your courtesy.
        Mr. Whitfield. Without objection.
        [The information appears at the conclusion of the hearing.]
        Mr. Whitfield. At this time I recognize Mr. Walden for 5
    minutes.
        Mr. Walden. Mr. Chairman, I thank you for that, and I am
    going to yield my 5 minutes to the distinguished gentleman from
    Texas, Mr. Barton.
        Mr. Barton. I thank the gentleman from Oregon, and I will
    root for the Ducks at least one time next year because you are
    yielding to me.
        Mr. Walden. If it is in the BCS, I will especially
    appreciate that.
        Mr. Rush. Mr. Chairman, let me just ask a question.
        Mr. Whitfield. Excuse me just one minute.
        Mr. Rush. The previous member made some pretty significant
    and strong remarks to Ms. Blaisdell, and she did not have a
    chance to respond at all on the record, so I think that she
    should be allowed to respond to some of the sharp remarks.
        Mr. Whitfield. Do you want to respond, Ms. Blaisdell?
        Ms. Blaisdell. Yes, please.
        Mr. Whitfield. All right.
        Ms. Blaisdell. So my first response would be that
    addressing our own greenhouse gas emissions hasn't created
    additional costs for our company. In fact, as I mentioned in my
    testimony, it saved us over $1 million a year, which makes us
    more competitive, and we do employ close to 2,000 people in the
    United States, so all those jobs he talked about in China, he
    is denying the fact that we actually do employ quite a few
    people here and in fact in many of the States that you
    represent.
        One of the concerns I have about the conversation we have
    had so far is that we have talked about the cost of action and
    we haven't talked about the cost of inaction, which I why I
    believe I am here. Our industry is very different than the
    industries represented. There is a significant cost of inaction
    in the outdoor industry and for brands whose supply chain rely
    on raw materials that we can't necessarily source in this
    country, so I would like to bring that to light.
        Mr. Whitfield. Well, I would just say that we appreciate
    your comments but I think most of us certainly agree with Mr.
    Shimkus, that if you are doing work in China and you are
    violating environmental regulations in China, to be coming over
    here and saying we need stronger regulations is a little bit--
    --
        Ms. Blaisdell. Sir, I don't understand what violations he
    is talking about so I will have to explore what he submitted.
        Mr. Whitfield. We will try to get that to you and maybe you
    can get back to us in writing about that.
        Ms. Blaisdell. I would be happy to.
        Mr. Whitfield. Mr. Walden.
        Mr. Walden. Thank you, Mr. Chairman. Again to Mr. Barton.
        Mr. Barton. Thank you.
        Attorney General Abbott, is Texas air quality improved or
    diminished during the period since Texas implemented its
    flexible permitting program under the Clean Air Act Amendments
    as implemented by regulation in 1992?
        Mr. Abbott. I don't have the information on Texas health
    quality.
        Mr. Barton. You don't have information that our air quality
    is actually improved?
        Mr. Abbott. I thought you said health quality.
        Mr. Barton. Air quality.
        Mr. Abbott. Absolutely air quality has improved.
        Mr. Barton. Significantly?
        Mr. Abbott. Significantly, yes.
        Mr. Barton. So we have not diminished our air quality under
    our permitting program?
        Mr. Abbott. I will tell you the information I do have, and
    that is the information that as I understand, it was provided
    by TCEQ, the Texas Commission on Environmental Quality, as well
    as information that we received from the governor's office. One
    point is that industrial ozone and NOx have steadily
    declined since 2000. Another is that ozone is down 22 percent
    while NOx is down 46 percent. Another is that
    electricity generators in Texas have the 11th lowest
    NOx emissions in the United States. But I think
    equally important, and that is without any kind of greenhouse
    gas mandates from D.C., Texas on its own has since 2004, no
    other State has cut more power sector CO2 output
    than the State of Texas. Also, as you know very well, we have
    installed wind power at a rate more than any other State in the
    United States and I think we would rank either fourth or fifth
    of all the countries in the entire world, and, as I understand
    it, Texas has one of the two largest absolute declines in
    greenhouse gas outputs of any State.
        Mr. Barton. I just want the record to show that Texas has
    issued all these permits since 1992. They have been in
    compliance with the Act. Our air quality has improved yet our
    economy has grown, and just arbitrarily here in the last 6
    months they have come in and invalidated the existing permits.
    We are not talking about new permits under the CO2
    regulations, we are talking about existing permits.
        Now, specifically, Attorney General, with regard to this
    pending legislation, do you support the draft Energy Tax
    Prevention Act of 2011?
        Mr. Abbott. There are reasons why we think this legislation
    is a good idea. First and foremost, in the big picture we are a
    Nation of laws, and that is one thing that has separated this
    country from all other countries in the world, in fact, made
    the United States the envy of all countries in this world, and
    that is that we as a Nation base our decisions on the law, not
    the whims of different people, and a challenge that the State
    of Texas is having with the EPA is that we feel that the EPA is
    acting in a way unconstrained by the Clean Air Act passed by
    the United States Congress, unconstrained by other laws such as
    the APA, and causing industry as well as States to have to deal
    with a moving target, and we think that the rule of law is
    essential in this country and we want to see the EPA comply
    with the rule of law. And along those lines Texas has six
    lawsuits on file right now challenging the legality of the
    greenhouse gas rules that were created by the EPA.
        Mr. Barton. If this bill were to become law, how would that
    impact the litigation that the State currently has against the
    EPA?
        Mr. Abbott. As the Attorney General of Texas, I am here to
    tell you that if your legislation passes, it will mean that
    Texas will be dismissing those six lawsuits against the EPA.
        Mr. Barton. And that is a good thing?
        Mr. Abbott. Anything that gets rid of lawsuits is a good
    thing.
        Mr. Barton. I agree with that.
        My last question is to the general panel. If we had to
    implement these greenhouse gas regulations which hopefully we
    won't but if we did, is there the technology currently on the
    shelf to cost-effectively implement the greenhouse gas
    regulations as proposed by the EPA?
        Mr. Alford. I daresay no.
        Mr. Rowlan. No.
        Mr. Cousins. For our industry, we looked at the 2008 ANPR
    that the EPA released as a guide for possible greenhouse gas
    regulations, and we have evaluated every one of those
    technologies at various times in the past to do efficiency
    improvements. Those things are all cost-prohibitive for us.
        Mr. Barton. My time has expired. I again want to thank my
    friend from Oregon for his courtesy.
        Mr. Whitfield. At this time I recognize Mr. Burgess for 5
    minutes.
        Dr. Burgess. Thank you, Mr. Chairman, and Attorney General
    Abbott, thank you for spending the day with us. I think there
    was some--I know it is difficult because the Administrator is
    not here any longer but it seems like there was some confusion
    when we were talking about the problem that Texas is having
    currently with the flexible permitting and her discussion of
    regulating greenhouse gases under the Clean Air Act. Those are
    two very serious issues but they are separate issues. Is that
    not correct?
        Mr. Abbott. That is correct.
        Dr. Burgess. And currently when I was discussing with her
    the report of the Business Roundtable, they pointed out that
    this would be one thing that would be extremely deleterious to
    Texas. Similar conditions exist in other States and no other
    State is being required to perform what Texas is being required
    to perform under their removal of the flexible permitting. Is
    that correct?
        Mr. Abbott. That is my understanding.
        Dr. Burgess. And then to the issue of regulation of
    greenhouse gases, she is correct that Texas right now is not
    proceeding with setting up those guidelines. Is that correct?
        Mr. Abbott. That is correct also.
        Dr. Burgess. And so as a consequence, the EPA feels it is
    necessary for that job to be done, and we can argue about the
    rightness or wrongness of that but that is indeed a separate
    issue when she says that since Texas wasn't doing its job, the
    EPA had to do the job for Texas but that in no way applies to
    the flexible permitting process that is going on down in the
    Gulf Coast area?
        Mr. Abbott. That is correct.
        Dr. Burgess. And these are difficult concepts to deal with.
    Mr. Barton talked about the air quality issues that have
    occurred since the enactment of the Clean Air Act, and while to
    be certain there are still significant challenges for us in the
    Dallas-Fort Worth metropolitan area, there are challenges in
    the Houston metropolitan area. When you look at the overall air
    quality, there has been improvement since 1992.
        If you look as what has happened to population growth,
    particularly in the Dallas-Fort Worth metropolitan area, with
    which I am most familiar, you have only got to look at what is
    happening with congressional redistricting and the fact that
    Texas is going to have four more seats in the next Congress to
    understand what is happening to our population in the Lone Star
    State. It is exploding. I have the 10th largest congressional
    district in the country, 280,000 residents over and above what
    I should have with the normal congressional allotment, so it is
    a phenomenal development that air quality has improved while
    our population has in fact expanded many times over what it was
    in 1992. Do you think that is a fair assessment?
        Mr. Abbott. Based on information I have, you are exactly
    right and that is that air quality in Texas has continued to
    improve despite the growing population.
        Dr. Burgess. Well, just in your experience in working with
    the EPA, is that an easy situation or a difficult situation?
    Has the EPA been open to your suggestions and your observations
    or is it a closed door and the cake is already baked, we don't
    need your input?
        Mr. Abbott. For more than a decade, I would say Texas has
    had a fairly collaborative, cooperative working relationship
    with the EPA. I can tell you that my office directly has been
    working side by side with the EPA to hold polluters accountable
    and has been quite successful in that regard. It seems as
    though over the past 18 months or so the challenges in dealing
    with the EPA have escalated dramatically and it has been a lot
    more difficult.
        Dr. Burgess. And that has just been my observation as well,
    and I was wondering if other people were noticing that as well.
        Mr. Rowlan, if I could, let me ask you a question, and
    again, I appreciate you being here. You are headquartered in my
    hometown in Denton, Texas, and we are all so grateful for your
    great efforts there. We are grateful for your great efforts
    with the University of North Texas and the research program
    that you have there. I think you have developed the largest
    frame testing machine west of the Mississippi. Is that an
    accurate statement? Well, we heard from Administrator Jackson
    that there are so many of these things that--and I am a
    believer in efficiency, and no one, I think, should be in favor
    of wasting energy but can you really capture the return on
    investment necessary to do the things that you are going to be
    required to do by simply latching on to those increases in
    efficiency? Are they going to pay for themselves over time?
        Mr. Rowlan. Well, we pursue those continually. We actually
    have energy intensity goals within our own company. We are
    pursuing improving our efficiency constantly, because if we
    don't, we are going to run into problems with our international
    competition. There are projects throughout the country, and I
    am aware of one steel mill that was shut down, however, for
    tenths of a cent per kilowatt-hour. When you consume as much
    energy as we do, the cost of energy becomes a huge impact for
    us and so as that starts to escalate, we are no longer able to
    compete because we are really close to the physical reality of
    what we can do with the equipment that we have got and the
    technology that presently exists and even the technology that
    is coming on now.
        Dr. Burgess. Thank you for your answer. I yield back my
    time. Thank you, Chairman.
        Mr. Whitfield. Mr. Waxman is recognized for 5 minutes.
        Mr. Waxman. Thank you, Mr. Chairman. We have heard quite a
    bit of criticism of EPA at today's hearing. We have heard that
    EPA is out of control and that simple commonsense measures like
    requiring newly built facilities to be energy efficient will be
    burdensome to the economy. But there are other voices who are
    not fairly represented here today. Many in industry believe
    that EPA is acting reasonably and taking modest first steps to
    combat a serious problem.
        On Friday, EPA held the first of a series of five listening
    sessions on New Source Performance Standards that it plans to
    propose later this year for power plants and refineries. I
    think it is worth pointing out that EPA is beginning the
    process of crafting these new standards by hearing from
    industry. At Friday's session, Eric Svenson of PSEG, a major
    utility company, said this about climate change: ``We obviously
    would prefer to have seen legislative action but absent
    legislative action, we support regulatory action,'' which by
    the way is my view.
        Mr. Rowlan, were you aware that this major utility supports
    EPA's regulation?
        Mr. Rowlan. Was I aware that they support regulation?
        Mr. Waxman. Yes.
        Mr. Rowlan. Yes, I would be aware of that.
        Mr. Waxman. Don Neal of Calpine, another utility, said
    this: ``Calpine has been a long supporter of EPA regulating
    greenhouse gases under the Clean Air Act and certainly the NSPS
    is an extension of doing that so we applaud EPA in doing
    this.''
        Mr. Carter, were you aware that at least one major utility
    is applauding EPA's program?
        Mr. Carter. Yes, sir.
        Mr. Waxman. OK. Well, the public wouldn't have known about
    these statements either, because these witnesses weren't
    invited to testify. In fact, we wanted these companies to come
    and testify but we were told by the Majority that they would
    not allow our request to hear from a coalition of businesses
    who develop energy-efficiency projects at major manufacturing
    facilities like, for example, steel plants. One member of this
    coalition recently helped a northern Indiana steel plant
    install technology to capture and harness the manufacturer's
    waste heat to generate 220 megawatts of power. That is more
    clean electricity than all of the solar panels connected to the
    U.S. electric grid, and that recycled energy saves the plant
    $100 million every year. Since we can't hear this testimony for
    ourselves, Mr. Chairman, I would ask that the written statement
    of the Alliance of Industrial Efficiency be placed in the
    record.
        Mr. Whitfield. Without objection.
        [The information appears at the conclusion of the hearing.]
        Mr. Waxman. Thank you.
        Ms. Blaisdell, in your testimony you say that EPA
    regulations would help protect the economy. By the way, I heard
    earlier in this hearing you were accused by one of my
    colleagues on the Republican side of the aisle, that you would
    be at a competitive advantage if these EPA regulations go
    through. Do you have any comment on that? Would you be at a
    competitive advantage if we regulate as EPA is proposing to do
    here in the United States?
        Ms. Blaisdell. I am not familiar with how we would be----
        Mr. Waxman. Press your mic.
        Ms. Blaisdell. It is on. I am sorry. I don't know how we
    would be at a competitive advantage.
        My other concern about his remarks is, he implied that
    energy costs drove our jobs overseas, and that is not the case
    in our industry, so I want that to be clear for the record as
    well.
        Mr. Waxman. Well, your company has been abiding by a self-
    imposed limit on its carbon pollution, and I would like you to
    tell the committee about your company's experience. Have your
    investments in efficiency produced cost savings, and if so, do
    you think other companies are likely to experience similar
    savings?
        Ms. Blaisdell. Our initiatives which have involved
    investing in renewable energy and in energy efficiency have
    saved our company money, over a million dollars a year, which
    is significant. We are a $1.4 billion company, so especially
    during a tough economy, that has been significant for us. And I
    do believe that other companies can benefit by taking a more
    critical look. I am sad to say that without leadership from
    Congress that many companies just aren't looking hard enough,
    and this could help.
        Mr. Waxman. And when somebody comes forward to suggest that
    maybe we can look harder to save money by doing what is right
    in efficiency which would make the company even more
    competitive, you are bullied by saying that you are part of
    some international conspiracy because you also have activities
    offshore. I don't think that is right.
        EPA has acted reasonably so far. We have heard from
    Administrator Jackson that the Agency plans to continue working
    with business to develop commonsense standards. Let us allow
    the Clean Air Act to do what it has always done: improve the
    air we breathe and make our families healthier while the
    economy grows. Thank you, Mr. Chairman.
        Mr. Whitfield. Yes, sir.
        Mr. Sullivan, you are recognized for 5 minutes.
        Mr. Sullivan. Well, I thought it was interesting, Ms.
    Blaisdell, that you said that your company did these things
    voluntarily, and I think that is great, and you have
    efficiencies and everything. That is what these business people
    do voluntarily. They do a lot of things like that too. You
    weren't mandated to do things, and I think that is the big
    difference, and that is what we are talking about here today.
        I appreciate all of you coming. I am sure you like the
    people in my district in Oklahoma are scared to death about
    what could happen to your businesses and the people that you
    work for, that you know their families and you know them very
    well, and it is frightening.
        I would like to ask you, Mr. Cousins, a question. You
    mentioned that while you were having trouble expanding your
    refinery, in India a refinery was built 15 times larger than
    your refinery and it took about 3 years. Could we build such a
    refinery in the United States today, in today's regulatory
    climate? And how long would the permitting for such a facility
    take? You mentioned the Indian refinery took 3 years to build.
    Would it take you longer?
        Mr. Cousins. Oh, I am not an expert on obtaining permits
    but I don't believe it would be possible to permit that
    refinery in the United States if you had all the time in the
    world, and I would--they have been trying to build a refinery
    at least at one time outside of Phoenix. I know that project
    has been going on for 10 years. I don't believe they have
    permits.
        Mr. Sullivan. And we haven't built a refinery in this
    country in, what, 30 years?
        Mr. Cousins. Over 30 years.
        Mr. Sullivan. And we probably need some, don't we?
        Mr. Cousins. Well, you would think. Actually we either need
    them here or they are just going to keep building them
    overseas.
        Mr. Sullivan. Have we ever domestically produced oil that
    we had to actually send somewhere else to be refined in this
    country?
        Mr. Cousins. I am not sure if any--we don't drill any oil.
    We just buy oil on the market. It could be that some Alaskan
    crude was sold. I don't know, but I am not aware of any
    significant oil exports.
        Mr. Sullivan. Your company has delayed a major project due
    to EPA's greenhouse gas regulations. Can you please explain how
    this business decision was made? How were the costs of these
    regulations calculated?
        Mr. Cousins. It is business uncertainty. We went about
    halfway through an expansion project of several hundred million
    dollars. In the climate of Waxman-Markey at the time and the
    fact that even if it was defeated as it was--well, Waxman-
    Markey wasn't, but if climate change was defeated, we didn't
    perceive the demand or the margins to justify the expansion we
    were in, not sure enough to bet our entire company's survival
    on it, and the debt load we would have carried would have put
    us in that situation. We actually had to terminate the project
    at the cost of 14,000 man-weeks of construction that was not
    completed in our town, so that is a couple of thousand jobs for
    weeks and weeks.
        Mr. Sullivan. I will start this with all the witnesses.
    What potential EPA regulations coming down the pike are you
    most concerned about from a business perspective? General
    Abbott?
        Mr. Abbott. From a business perspective, what regulations?
        Mr. Sullivan. Yes.
        Mr. Abbott. Well, the greenhouse gas regulations are the
    ones that are posing a huge problem.
        Mr. Sullivan. And in Texas, you are hearing that from
    everybody, huh?
        Mr. Abbott. Well, as I visit with people across the State,
    frankly, it is the overall uncertainty that seems to be
    emanating from the EPA, not knowing what the standards are
    going to be and how to plan for the future.
        Mr. Sullivan. Mr. Alford?
        Mr. Alford. Congressman, I am also a member of the board of
    directors of the U.S. Chamber of Commerce, and I chair the
    regulatory affairs committee for them, and this greenhouse gas
    business is about 70 percent of the discussion, and I believe
    the Chamber has filed a series of lawsuits against EPA
    concerning that.
        Mr. Sullivan. Mr. Rowlan?
        Mr. Rowlan. While I agree that greenhouse gas is a big
    issue and has a lot of impact, I would not discount or put
    anything below that with respect to the new one-hour criteria
    pollutant standards that we are getting along with several MACT
    standards. We are getting hammered from every which direction.
    So I think they are all right there. If one doesn't catch you,
    the other one does, and it is almost like a game of gotcha.
        Mr. Sullivan. And the economy is bad enough, with all this.
    Mr. Pearce?
        Mr. Pearce. I would say the greenhouse gas.
        Mr. Sullivan. Mr. Cousins?
        Mr. Cousins. With my written testimony, I included a slide
    that showed a blizzard of EPA regulatory initiatives. We are
    concerned about all of them, but the PSD and the NSPS portions
    of the greenhouse gas regulations are the most immediate
    concern.
        Mr. Sullivan. Mr. Carter?
        Mr. Carter. I would say the greenhouse gas regulations but
    we should not ignore the other items that are coming out of EPA
    today because some of them may actually have a faster impact on
    utilities in the immediate term. And the reason is, is that we
    do not have commercially available technology to look at our
    plant, and what we have created is a system where there is a
    great deal of uncertainty because even if Ms. Jackson, who I
    have a lot of respect for, even if she goes forward, she does
    not prevent the legal challenges much like we saw on the CARE
    rule. If you are familiar with the CARE rule, it was in place
    for years and then it got vacated and now it is being
    completely rewritten. That is pretty scary if you are in my
    business.
        Mr. Sullivan. That is a very good point.
        Ms. Blaisdell, are there any regulations that concern you
    and your company?
        Ms. Blaisdell. They don't. Actually the EPA has been quite
    helpful to our company, not hurtful.
        Mr. Sullivan. There are no regulations that concern you at
    all about EPA?
        Ms. Blaisdell. The greenhouse gas regulations do not
    concern our company. They don't apply. We don't emit over
    100,000 tons.
        Mr. Sullivan. Thank you, sir.
        Mr. Whitfield. Mr. Scalise, you are recognized--no, I am
    sorry. Mr. Terry, you are recognized for 5 minutes.
        Mr. Terry. Thank you, Mr. Chairman.
        Ms. Blaisdell, thank you for being here, and I don't know
    what, somebody on our side of the aisle evidently insulted you,
    but that is not the way it is supposed to work here. I
    appreciate that Timberland is voluntarily undertaken, and I
    know several businesses in the Omaha metropolitan area that I
    represent that have voluntarily undertaken a variety of energy
    efficiencies in their business too, and we like that. I love
    it. What I don't like is the EPA just assuming that they have
    legislative powers, and that that is what this is about.
        But I do want to make it clear, Betsey, that unlike the
    gentleman that was asking you questions, I am not going to call
    your boss and ask that you be fired for coming here and
    speaking your mind nor like somebody else on the Minority side,
    I am not going to write a letter to a regulatory agency asking
    that they investigate Timberland because you are here. I
    actually think it adds, and I want to state that for the record
    because that is exactly what happened to one of our Minority
    witnesses at a cap-and-trade global warming hearing, and it was
    a constituent of mine so I am always going to stick up for that
    person.
        Getting to Nucor, Mr. Rowlan, thank you. Nucor facility,
    not in my district, but an hour-and-a-half drive and I have
    been up there, I have seen the operation, and would join with
    Mr. Inslee in saying thank you for the efficiencies. I think it
    is a well-run business. Like Timberland, I appreciate that you
    have undergone voluntary measures to reduce your energy costs
    and emissions. Likewise, let me ask you this question under the
    clean air law. Even with all of the efficiencies that you have
    adopted, will one of your recycling plants like the one in
    Norfolk emit more than 250 tons of CO2 in a calendar
    year?
        Mr. Rowlan. Most definitely. We are caught up, all of our
    steel mills like the one in Nucor are caught up.
        Mr. Terry. Is there any way of getting your plants
    considering the smelting, melting processes, to be under 250
    tons of CO2 in a given calendar year?
        Mr. Rowlan. There is no physical law I am aware of that
    could ever cause that to happen.
        Mr. Terry. And you are aware that that is what your
    company, Nucor, would be under the exempted area where it would
    be not 100 tons in a year but 250 tons would be what is
    currently written in the Clean Air Act?
        Mr. Rowlan. We are already a major stationary source.
        Mr. Terry. You understand that rule very well.
        Mr. Rowlan. I understand and live that rule.
        Mr. Terry. And probably, since you understand the rule,
    know that EPA directors just can't willy-nilly change that part
    of the statute. Is that your understanding?
        Mr. Rowlan. I would believe that that was the case, and I
    hope Congress----
        Mr. Terry. If an EPA director can just start willy-nilly
    throwing out, okay, the statute says very clearly and your
    history has been that under the major emitter rule that you
    would qualify under the exemption of 250 tons and then she
    comes around and says something different and enforces that.
    Does that give you more or less certainty in the industry?
        Mr. Rowlan. If we use the 250 tons?
        Mr. Terry. No, if someone, the EPA, this EPA director says
    it is 100,000, the next one starts saying it is 50,000 or 10,
    if that is the power that they have, does that provide you
    certainty?
        Mr. Rowlan. It gives me no certainty at all. I defer to
    what the Attorney General from Texas said. We are a Nation of
    laws and I don't see that it is consistent with the law at that
    point.
        Mr. Terry. I appreciate that.
        And then Mr. Alford, I have some charts regarding the study
    that you have done or your organization that shows the job
    losses, and I am just wondering what the criteria were
    generally to determine that in 2015 you would have a million
    and a half jobs lost and by 2030 it would be pushing 2,500,000
    jobs lost just due to this rule. Because we heard from
    Administrator Jackson that it is going to be actually a job
    creator, but you are showing job losses. How do we jibe those
    two?
        Mr. Alford. Well, we spent some good money on that study
    from Charles River Associates. That is a very reputable firm
    based here in Washington, D.C., and that was done early 2009.
    We have shown it to the world, and we have not had one person
    or entity challenge those studies that are in that study, the
    charts.
        Mr. Terry. So you are standing behind your study?
        Mr. Alford. Absolutely.
        Mr. Terry. All right. Thank you very much.
        Mr. Whitfield. Thank you, Mr. Terry.
        At this time I recognize Mr. Scalise for 5 minutes.
        Mr. Scalise. Thank you, Mr. Chairman.
        Mr. Rowlan, I first want to thank you for the commitment
    you made to create jobs in America but specifically in
    southeast Louisiana, and we really appreciate the presence of
    Nucor. I think you were here when I had a conversation with Ms.
    Jackson about her report, that she stated that these
    regulations will create jobs, and I think she tried to use
    Nucor as a poster child for how these new regulations will
    actually grow the economy and yet I know in your testimony, you
    talked about the opposite, and believe me, yours is not an
    isolated example. I hear this day in, day out of companies that
    talk about the burdens of EPA and how it runs more jobs out of
    the country, and I know in your testimony you talked about the
    larger presence of American jobs that would have been created
    here if not for the threat of EPA. So I wanted to first thank
    you, of course, but also give you an opportunity to talk about
    that specifically in her comments of using you all as the
    poster child for how this is working so well yet it seems to
    contradict what is actually happening in reality.
        Mr. Rowlan. Well, are you speaking of our Nucor Louisiana
    project, and yes, we had originally planned to build, I think
    it was the first two blast furnace operation permitted under
    the Clean Air Act along with coke ovens and cinder plants and
    produce 6 million tons of pig iron. We now have reduced that
    project and that is moved off to phase 2 if we do get the final
    permit on that.
        Mr. Scalise. So you are still waiting on a permit from EPA?
        Mr. Rowlan. That permit has been issued but it is stayed
    until the litigation over it is completed. There are a couple
    of lawsuits going on right now against Louisiana Department of
    Environmental Quality. The replacement project was a direct
    reduced iron project, and so that people can understand, if you
    say we were going to build pickups at the original facility,
    what we ended up making are, I don't know, bicycles or
    something like that. This is a different product. It is still
    iron but it is a different product, and it is significantly
    different in the overall employment impact. I think we had----
        Mr. Scalise. Can you touch on that? What would the jobs
    have been versus what they will be here in America?
        Mr. Rowlan. I believe the original was around 1,000 jobs
    when the full project was in, and we are around 150 jobs right
    now. I think that is right. And then there was about 2,000
    construction jobs originally and we are at about 500
    construction jobs right now, around 2.1 billion and we are
    around 750 million right now.
        Mr. Scalise. So you are talking about well over a billion
    and a half dollars roughly that was lost in investment, 1.25
    billion maybe that was lost in investment----
        Mr. Rowlan [continuing]. Not moving forward with it at this
    point. It is still in phase 2. We would hope to be able to do
    that at some point.
        Mr. Scalise. What is the average pay for those jobs, the
    thousand you were originally anticipating versus the 150 now?
    What is the average pay of those jobs?
        Mr. Rowlan. Our publicized average pay at a Nucor facility
    is $70,000 a year.
        Mr. Scalise. Gee, whiz. Well, these are great jobs, and
    unfortunately, a lot less of them right now because of the
    regulations. Again, I have heard the story time and time again
    and EPA will come out and say the regulations are creating
    jobs. Maybe what they are not realizing is, it is jobs in China
    and India that they are creating, not here in America. So I
    appreciate what you are doing. I share your frustration, and we
    are going to continue to work through and get real clarity so
    that businesses can go forward.
        Mr. Cousins, there was some comment earlier by another
    member talking about how the Energy Tax Prevention Act would
    somehow lead to increased dependence on Middle Eastern oil. Of
    course, this Administration's policies have led to an increased
    dependence on Middle Eastern oil and higher gas prices. The
    bill, in my opinion, would actually at least give some
    sustainability and hopefully we can then get to a point where
    we reduce our dependence, but do you see anything in the
    legislation that would increase this country's dependence on
    Middle Eastern oil?
        Mr. Cousins. No, not at all. I think acts already carried
    on by Congress and by the EPA, CAFE standards increase have cut
    fuel use quite a bit. Renewable fuel standard is putting 36
    billion gallons of non-gasoline into the gasoline and diesel
    supply through the next few decades. I think everything is
    tending toward a reduction.
        Mr. Scalise. And in fact, when Administrator Jackson agreed
    with that comment, I thought it undermined the credibility to
    say that a bill that prevents EPA from shutting jobs out of
    America, running more refineries to India and other places, for
    her to suggest that that increase our dependence on foreign oil
    when actually it is EPA's actions that increase the dependence.
        And the final question, can you talk in terms of the jobs
    that you haven't been able to create, the expansion that you
    haven't been able to do because of EPA's regulations?
        Mr. Cousins. Well, as I said earlier, we were partway
    through a multi-hundred million dollar expansion in a small
    town. There were about 14,000 man-weeks, which would be one
    person working for 14,000 weeks on the job to complete the
    construction, or 2,000 people working for 2 months. We just had
    to stop, and those people were terminated, and that is a big
    hit in a county where we lost 2,000 jobs out of 40,000 workers
    in a poultry operation that shut down.
        Mr. Scalise. Well, hopefully we can pass this legislation
    and save those jobs. I appreciate your testimony. I yield back.
        Mr. Whitfield. Thank you.
        Mr. Olson of Texas for 5 minutes.
        Mr. Olson. Thank you, Mr. Chairman, and I can assure the
    witnesses and all the people here watching this hearing that I
    am the last Texan that is going to speak today, and we are
    Texans, we are very proud and please bear with us.
        But I would like to speak to General Abbott, and first of
    all, sir, I would like to thank you for what you have done for
    our State to create an environment that we do have some
    stability, some predictability, some certainty, and I greatly
    appreciate that.
        One of the things all of us when we go back home, one of
    the biggest concerns our constituents have is jobs, jobs, jobs,
    and as my colleague Gene Green said, our State has had the good
    fortune of creating half the private sector jobs since our
    economy went into a recession, half the ones here in America.
    My colleagues Joe Barton and Mike Burgess have told us about
    the success of the flexible permitting system. Our air is
    demonstrably cleaner. There is no doubt about that. We have the
    facts. And I know personally because I moved to Houston in
    1972, and our general grew up in Houston as well and it wasn't
    such a clean town. I mean, you could not see downtown from 20
    miles out when I came out of Clear Lake and headed towards
    downtown. Now that is the exception maybe one or two days
    during the summer that that exists. Most every day you can see
    downtown, so that is just demonstrably cleaner from my own
    personal experience. Our process has worked. You would think we
    would be a role model for the country, here is how we can get
    through this, here is how we can have a cleaner environment and
    a good environment for business and be clean. But it concerns
    me that what is doing with this excessive regulation, how that
    is coming into our economy in Texas.
        Attorney General Abbott, do you see a tipping point here? I
    mean, if they keep going forward down this line with all this,
    the flexible permitting, some of the hydraulic fracturing
    issues, some of the other issues, the ozone standards, do you
    see a turning point here where the environment that the Federal
    Government creates starts killing jobs in our State?
        Mr. Abbott. Well, a couple things. If I could pick up on
    one of your earlier comments, first of all, to help people
    understand, people see Texas challenging the EPA both
    regulatorily and with lawsuits, but I want to emphasize a point
    that you made, and that is that Texas takes pride in trying to
    achieve the best. That includes achieving the best possible
    environment and health environment for our citizens, and as a
    result, that is one reason why we have worked so hard and
    achieved so much in improving air quality in your district and
    across the State of Texas, and we stand committed to continuing
    to achieve improvements in air quality and the environment, but
    that doesn't meant that we are going to stand aside or roll
    over if we believe that the EPA is imposing its will in a way
    that is contrary to the law.
        You mentioned a tipping point, and there is another phrase
    you could also use in tandem, and that is a slippery slope. We
    are very concerned about the slippery slope. I think it was
    Representative Terry who brought up earlier in the context of
    the tailoring rule, and we are very concerned about what the
    tailoring rule could turn into once it starts moving on a
    slippery slope where it gives latitude to the EPA to decide
    what the standards may be. It could shift from today to 5 years
    from now to 10 years from now and it could very well bring in
    Nucor and some other industries within the gambit of what they
    are able to emit.
        But I think we are at a tipping point also because if these
    greenhouse gas regulations by the EPA go into place or upheld,
    we are a tipping point in two ways. One, it means that the EPA
    does have carte blanche to make up its own rules as they go
    along and that they are saying they are not confined by the
    terms of the Clean Air Act that was passed by the United States
    Congress. But also we are at a tipping point in the sense of
    what it is going to mean for our jobs, our economy and the
    future of this country when we have out-of-control regulations
    that are crushing the attempt to expand our economy at a time
    that we most desperately need it to grow.
        Mr. Olson. Thank you for that answer, Mr. Attorney General.
    You are a great public servant.
        I have about run out of time. Thank you to all the
    witnesses. I appreciate your views and perspectives.
        Mr. Whitfield. Mr. McKinley, you are recognized for 5
    minutes.
        Mr. McKinley. Thank you. I am coming from the perspective
    of the coal fields of West Virginia and what the EPA has done
    in the coal fields, the uncertainty that is coming to them from
    water, fly ash, dust, revoking retroactively permits. Then I
    see the next fight looming on the horizon is not going over
    into another segment with the EPA and the uncertainties that
    they bring with their regulatory extremism. We have all heard
    in West Virginia job killers, the extreme, irrational lack of
    common sense. It is bad enough for us in the coal fields. What
    happens when it sweeps across America controlling the
    greenhouse gases? So you all have--understand, there are still
    15 million people unemployed and until the uncertainty is
    removed, I have got to think you are reluctant to take on more
    responsibility. So we are going to continue having 15 million
    people unemployed in America. That is not where I want us to be
    as a country.
        So now, having framed that, you have all been listening for
    hours here of testimony today. I am just curious, are any of
    you more confident in what you have heard from either the other
    side or here that things are going to be okay, allow the EPA to
    continue down this path of regulating the greenhouse gases? Can
    each of you just, are you more comfortable now after you have
    heard 2 hours?
        Mr. Abbott. Let me say that I grew more comfortable when I
    saw this bill, this Act being proposed by this subcommittee.
    The concern that we had in Texas was the imposition of the
    greenhouse gas regulations. We perceive that the most
    meaningful way, the most meaningful pathway in order to protect
    the future was not by our litigation fights in the courthouse
    against the EPA but by action by this body. The promise of the
    future rests with regard to this potential legislation, and we
    hope that it passes because we believe it will provide
    certainty and clarity for the environment regulation side of
    the world.
        Mr. McKinley. Thank you. Mr. Alford?
        Mr. Alford. I have optimism in that Carol Brown has left
    the Administration, which I believe was pulling or pushing Ms.
    Jackson, who is a fine lady and a fine American, but the cap-
    and-trade bill died. The American people rejected it. It is
    gone. You can't have it. So you can't go around through
    chicanery or deception or end around or making the EPA a
    runaway freight train to make it happen, and we have got to
    stand tall and be resolved to fight it again.
        Mr. Rowlan. I can't say that I have more certainty. I think
    I will watch for the votes. I think my issues always go back to
    this, and it is whether--I am a technical person and an
    engineer by training, and when I look at it, I always look at
    what is the end result that you are trying to achieve, and
    everything that I have seen with respect to the regulation of
    greenhouse gases, nothing ever accomplishes the end goal of
    lowering the global concentration, and so the question I ask
    is, why do we do it if it not going to accomplish what we state
    is the end goal? And I have gone on record as saying if we are
    doing it and we are just doing it to hurt ourselves and we
    don't accomplish a lowering of the global concentrations, we
    are on a fool's errand.
        Mr. McKinley. Thank you.
        Mr. Pearce. I am encouraged by what this legislation and I
    am encouraged by the support that we have heard for it today,
    but I am concerned that if we don't pass this, if it is not
    legislative, what kind of ticket that does that write for the
    EPA and other areas? It sets a precedent.
        Mr. Cousins. The Energy Tax Prevention Act gives us a
    fighting chance. Without it, the future is quite grim.
        Mr. Carter. I am encouraged because we are considering this
    piece of legislation. That is why I am here today. I would
    point out that there are things that we can do that could be
    done if we want to adopt policy that will allow electric
    utilities to move forward fewer emissions like the things that
    we are doing--new nuclear plants, which still have a great deal
    of hurdles in front of them, not from a technology perspective
    but from a regulatory perspective. I can speak directly to that
    as being part of that restart.
        Also, industry or entities like us, we need to make sure we
    have the comparable incentives so that we can move into what I
    would call other green types of resources and clear some of the
    regulatory hurdles associated with those also.
        Ms. Blaisdell. I think this legislation encourages
    inaction, and I don't believe that that creates more certainty,
    and in fact, it could lead to more patchwork of State
    regulations, which I can't speak to greenhouse gas patchwork of
    State regulations because that hasn't applied to our company
    yet other than to say I know from experience with other
    patchwork of regulations that that is not good for our company.
    I imagine that wouldn't be good for the companies that are
    represented here as well.
        Mr. Whitfield. Mr. Gardner, you are recognized for 5
    minutes.
        Mr. Gardner. Thank you, Mr. Chairman, and thank you to the
    witnesses for being here today, taking time away from work and
    for participating in this hearing. I really appreciate it.
        Mr. Cousins, I have a question for you from your testimony
    earlier today. During Administrator Jackson's testimony, she
    said that the economy was doing great, and when I pushed back a
    little bit on that question, she said just the rural economy is
    doing great, and you had mentioned that in your county you are
    facing some significant unemployment. Could you describe that
    again?
        Mr. Cousins. Well, our county has about 43,000 people in
    it, and we lost almost 2,000 jobs in one blow when a poultry
    operation shut down in our area. Our unemployment is double
    digit, and that is hardly thriving to our way of thinking.
        Mr. Gardner. And is it your view, Mr. Cousins, that
    regulations like this will hurt rather than help the employment
    situation in your county?
        Mr. Cousins. Absolutely.
        Mr. Gardner. And a question for Mr. Rowlan or Mr. Pearce.
    There was some discussion during the Administrator's testimony
    that these regulations are actually creating jobs, that the
    more we have regulations, the more jobs are created, and she
    also mentioned, and I think it was $2 trillion in money that is
    sitting out waiting to be invested and she believe that because
    of this regulation that that money would start moving back into
    the economy and being invested. Are any of you planning on
    investing because of this regulation? Ms. Blaisdell?
        Ms. Blaisdell. The cost of inaction for us means that our
    supply chain will suffer and our ability to deliver products to
    our consumers will suffer as well.
        Mr. Gardner. Mr. Carter or Mr. Alford, anybody else want to
    comment on that?
        Mr. Alford. Some of my stronger members are going to Ghana,
    Kenya, China. I have got a board member going to Mongolia next
    month. They are looking elsewhere, and I think that is sad.
        Mr. Gardner. And a question, do you believe that
    regulations create jobs?
        Mr. Alford. Regulations, I believe, are intended to prevent
    crime and fraud and adherence to good corporate responsibility.
    That is it.
        Mr. Gardner. I thank you. And I wanted to ask a few more
    questions based on some statements that were made here in the
    committee, following up on that last question. The EPA analysis
    mentioned by some on this committee had said that just one of
    EPA's Clean Air Act standards has kept about 200,000 people
    occupied, 200,000 person-years of labor over the past 7 years,
    and in your opinion, doesn't this mean that this means the EPA
    is keeping people employed? I mean, what would you say to
    somebody who actually is trying to bring capital investment
    into this country, given the regulatory structure that we are
    facing today? Mr. Abbott or Mr. Alford?
        Mr. Abbott. Along that line, it is good for jobs in the
    legal sector. We will need more lawyers to handle more legal
    work. But other than that, of course, with the way that
    greenhouse gases work and if we have regulations here in the
    United States and there are not similar regulations around the
    world, logically it seems like it is going to force industry,
    jobs, employers across the border into Mexico or Canada or to
    China and India and other parts of the world.
        Mr. Gardner. Thank you, Mr. Chairman. I yield back my time.
        Ms. Blaisdell. Can I respond as well?
        Mr. Whitfield. Sure.
        Ms. Blaisdell. I think without a lack of certainty, what
    ends up happening is what we are seeing right now in China
    where they are actually producing renewable energy systems
    because we didn't create any certainty here, a long-term demand
    for those alternative energy sources. We haven't talked about
    those jobs today. That could have been U.S. jobs.
        Mr. Whitfield. Mr. Griffith, you are recognized for 5
    minutes.
        Mr. Griffith. I think Mr. Rowlan wanted to add something to
    that comment, I will ask you to say whatever it is you were
    thinking.
        Mr. Rowlan. As you know in my testimony I said that
    affordable energy is the lifeblood of industry, and renewable
    energy has to be affordable. If it isn't affordable, then all
    it does is displace a job because the price of your energy goes
    up as we talked about, and I was privy to some research that
    should be coming out shortly that in the last couple of years
    there has been 333 projects, energy generation projects that
    have been stalled, shut down, or otherwise abandoned in this
    country, 111 coal-fired power plants, 22 nuclear plants, 21
    transmission projects, 38 gas and platform projects and 140
    renewable projects that haven't even gotten through. Eighty-
    nine of those were wind, four were wave, 10 were solar, seven
    were hydro and 29 were biomass. Now, if you sit and we said we
    got all that energy and let us just take the affordable part of
    it and not the renewable unaffordable part of it, if we got
    that energy, look at the jobs that would begin to create
    because that energy goes out and that creates industry which
    builds things, which makes jobs and that just continues to roll
    forward.
        But the sad part of this is, 45 percent of those 333
    projects are renewable projects and we can't even get them
    permitted without the greenhouse gas rules. Now, let us add
    another brick onto that burden and let us see if that mule can
    walk.
        Mr. Griffith. Thank you.
        General Abbott, I am a lawyer or a recovering lawyer. Now
    that I am doing this, I can't practice anymore. But I have read
    the Massachusetts v. EPA decision, and you obviously have too,
    and I looked at that next-to-last sentence where it says ``We
    hold only that the EPA must ground its reasons for action or
    inaction in the statute.'' Now, earlier today when I was
    speaking with Ms. Jackson, she indicated that the reason that
    they had changed instead of it being 100 of 250 to 100,000 in
    their tailoring was because if they had enforced the law as
    written, it would be absurd, and I agreed with her on that. But
    I guess my question to you is, is that she said that they felt
    that because it was going to be an absurd result, that they had
    the authority to change the rule, so to speak, and I went to
    law school, I never got that class, and I am just wondering if
    I missed something over the years or maybe you knew, is there
    authority for a bureaucracy to change the law because they end
    result would be absurd or is that the duty of the legislative
    branch of government?
        Mr. Abbott. As I understand it, their legal argument is
    based upon what would be called the absurdity doctrine. As
    understand it, the absurdity doctrine is not a valid legal
    doctrine for them to base their decision on and it is more like
    a hope and a prayer that they can get away with changing the
    clear language established by Congress in the Clean Air Act.
    This is a way in which there is an evasion of the law and a
    creation of new law by the EPA.
        Mr. Griffith. And in that vein, am I not correct that once
    she made the determination that there was an endangerment, she
    needed to apply the rules to all 6 million businesses that
    would come under the 100 or 250 regulation and that by not
    doing so if someone were to sue, all 6 million in that universe
    would come under the law and that that would create chaos, I
    mean, not just damage the economy but create sheer chaos in the
    economy, and isn't it then better that we pass this legislation
    so that we can then have that argument in the halls of Congress
    instead of having the fear that at some point in the future a
    court is going to rule that you have to apply it to all--
    whatever rules they come up with apply to all 6 million in the
    universe and that 6 million is of course her number.
        Mr. Abbott. Right. You are absolutely correct. Our great
    concern is that the tailoring rule is going to be challenged,
    not just from our side but also from those who really want to
    decrease those thresholds, thereby making schools, farms,
    hospitals, small businesses, literally thousands upon thousands
    of job creators and employers across the country suddenly
    subject to these limitations, almost stifling overnight our
    economy.
        Mr. Griffith. And the solution would be passage of this
    bill?
        Mr. Abbott. The solution has to be the passage of this
    bill.
        Mr. Griffith. I thank the gentleman and yield back whatever
    time I have left.
        Mr. Whitfield. Mr. Griffith, thank you very much, and I
    want to thank the panel. We genuinely appreciate your taking
    time to come and talk to us about practical issues as we try to
    balance environment protections, health care and economic
    development, and your testimony on job creation was very
    important and we appreciate it, and so I will dismiss this
    panel. Ms. Blaisdell, I asked them to get these newspaper
    articles that Mr. Shimkus referred to, if you all would like to
    see them.
        We will call up the fourth panel, and on the fourth panel
    we have Peter Glaser, a partner with Troutman Sanders; Dr.
    Margo Thorning, Senior VP and Chief Economist, American Council
    for Capital Formation; Mr. Philip Nelson, President of the
    Illinois Farm Bureau; Mr. Fred Harnack, General Manager, U.S.
    Steel Corporation; Mr. James Goldstene, Executive Officer,
    California Air Resources Board; and Dr. Lynn Goldman, American
    Public Health Association. I want to thank you all very much
    for being with us. We appreciate your patience. We are going to
    declare you honorary members of the Energy and Commerce
    Committee because you have been here so long. And then at this
    time Mr. Glaser, I will call upon your for your 5-minute
    opening statement, and then we will get to questions after
    that. Mr. Glaser, thank you for being here.

    STATEMENTS OF PETER S. GLASER, PRESIDENT, TROUTMAN SANDERS LLP;
    DR. MARGO THORNING, SENIOR VICE PRESIDENT AND CHIEF ECONOMIST,
        AMERICAN COUNCIL FOR CAPITAL INVESTMENT; PHILIP NELSON,
       PRESIDENT, ILLINOIS FARM BUREAU; FRED T. HARNACK, GENERAL
     MANAGER, ENVIRONMENTAL AFFAIRS, U.S. STEEL CORPORATION; JAMES
       N. GOLDSTENE, EXECUTIVE OFFICER, CALIFORNIA AIR RESOURCES
        BOARD; AND DR. LYNN R. GOLDMAN, AMERICAN PUBLIC HEALTH
                              ASSOCIATION

                      STATEMENT OF PETER S. GLASER

        Mr. Glaser. Thank you very much, Mr. Chairman. Members of
    the committee, I appreciate the opportunity to testify here
    today. My written testimony, which is very detailed, provides
    an analysis from a legal standpoint of why the Clean Air Act is
    such a poor vehicle for addressing greenhouse gas emissions,
    and I will just summarize some of my points there.
        I want to emphasize at the outset that I am not
    representing any of my clients here today. I am not being
    compensated for this testimony, and the views I express here
    are my own and do not necessarily reflect the views of my
    clients.
        I also want to say at the beginning that my testimony has
    nothing to do with the science. Whatever you feel about the
    science either way, if you believe in the science one direction
    or another, my testimony still works.
        The main problem with regulating greenhouse gas emissions
    under the Clean Air Act, even if you think that greenhouse
    gases is something that the country needs to regulate, is that
    the statute was not designed for that purpose, and as a result,
    EPA's regulatory aims do not comfortably fit within the
    programs that are in the Clean Air Act. We know this because
    EPA itself has said that regulating greenhouse gases under the
    literal language of the statute, as we have heard many times
    today, creates an absurd result. If you use the statute, you
    get an absurd result, and the only way to avoid this is for EPA
    to tailor the statute itself. You have to change the statute.
        Just putting aside legal arguments about whether or not EPA
    could do that, the problem is that EPA has been forced to
    engage in this kind of creative legal interpretation in this
    area and in several other areas that are set forth in my
    testimony, and all of this shows is that EPA is trying to make
    the statute do something that it was not designed to do. And so
    what you get from this are lawsuits and you get regulatory
    uncertainty, and in the end what might happen if EPA is wrong
    is that you end up unleashing regulation on a very, very large
    number and variety of small emitters.
        Indeed, we may be facing more absurd consequences of trying
    to regulate under this statute. As EPA confronts a petition to
    regulate greenhouse gases under the National Ambient Air
    Quality Standards. I actually thought the single most
    disturbing thing that I heard today having sat here all day was
    the Administrator's statement that in fact they may get forced
    into establishing a greenhouse gas National Ambient Air Quality
    Standard. Unfortunately, the only legal precedent on the books
    on this would seem to be point to a necessity that they do
    that. This is set forth in more detail in my testimony. That
    would create truly severe economic consequences under a program
    that could never be complied with. That is very concerning.
        Now, importantly, and there has been some discussion of
    this today, EPA has not done an overall comprehensive
    assessment of the cumulative costs and benefits of all of the
    greenhouse gas regulation that it has in mind nor has EPA set
    forth its overall plan of regulation where it lists out in
    advance for everybody to see what the requirements will be,
    what categories of sources that they intend to regulate, what
    programs they intend to regulate under and what the full
    regulatory timetable is. We heard the Administrator say today
    that they are taking this on a rule-by-rule basis but that they
    can't anticipate what all the rules will be because they don't
    know what all the rules will be. We heard her say that they got
    petitions, multiple petitions to regulate different sources.
    They don't know how they are going to act on that. We heard her
    say that they are going to be doing cost-benefit analysis but
    only in the context when they get to actual rules.
        Now, all this is despite the fact that they have a 5-year
    plan. EPA has a 5-year strategic plan, and goal number one of
    the 5-year strategic plan is taking action on climate change
    and air quality. So presumably they have a plan but they have
    not told us in advance what the specific elements of the plan
    are. As a result of all of this, we are in the process, we have
    started down this path of one regulation after another, but
    before we decided to do that in the first place, we never
    assessed what the overall cost and consequences and benefits
    were going to be, and this to be should be very concerning
    because it contributes to the large uncertainty of where
    exactly the Nation is going.
        You know, one flaw with proceeding on a rule-by-rule basis
    and trying to determine what the costs and benefits of
    regulation are can be seen in their first foray into greenhouse
    gas regulation. Their first foray, of course, was the motor
    vehicle, the tailpipe rule. In the tailpipe rule, they assessed
    the costs of the tailpipe rule on the motor vehicle industry.
    They also said that the tailpipe rule automatically and as a
    matter of law triggers greenhouse gas regulation of large,
    stationary sources. But there was no study as to what those
    regulations were going to be and what the cost was going to be.
    So as we have started out as of January 2nd in regulation
    greenhouse gases under these programs, we still have no overall
    assessment of whether the benefit will exceed the cost.
        Mr. Whitfield. If you would summarize, Mr. Glaser?
        Mr. Glaser. Sure. I think the overall question for this
    committee is what part of government should make the critical
    policy choices that are inherent in determining how the Nation
    uses energy. To me, this is the main issue before this
    committee. Should it be EPA under a statute that they are
    relying on that was enacted in 1970 or should it be Congress?
    Thank you.
        [The prepared statement of Mr. Glaser follows:]

        [GRAPHIC] [TIFF OMITTED] T5734.266

        [GRAPHIC] [TIFF OMITTED] T5734.267

        [GRAPHIC] [TIFF OMITTED] T5734.268

        [GRAPHIC] [TIFF OMITTED] T5734.269

        [GRAPHIC] [TIFF OMITTED] T5734.270

        [GRAPHIC] [TIFF OMITTED] T5734.271

        [GRAPHIC] [TIFF OMITTED] T5734.272

        [GRAPHIC] [TIFF OMITTED] T5734.273

        [GRAPHIC] [TIFF OMITTED] T5734.274

        [GRAPHIC] [TIFF OMITTED] T5734.275

        [GRAPHIC] [TIFF OMITTED] T5734.276

        [GRAPHIC] [TIFF OMITTED] T5734.277

        [GRAPHIC] [TIFF OMITTED] T5734.278

        [GRAPHIC] [TIFF OMITTED] T5734.279

        [GRAPHIC] [TIFF OMITTED] T5734.280

        [GRAPHIC] [TIFF OMITTED] T5734.281

        [GRAPHIC] [TIFF OMITTED] T5734.282

        [GRAPHIC] [TIFF OMITTED] T5734.283

        [GRAPHIC] [TIFF OMITTED] T5734.284

        [GRAPHIC] [TIFF OMITTED] T5734.285

        [GRAPHIC] [TIFF OMITTED] T5734.286

        [GRAPHIC] [TIFF OMITTED] T5734.287

        [GRAPHIC] [TIFF OMITTED] T5734.288

        [GRAPHIC] [TIFF OMITTED] T5734.289

        [GRAPHIC] [TIFF OMITTED] T5734.290

        [GRAPHIC] [TIFF OMITTED] T5734.291

        [GRAPHIC] [TIFF OMITTED] T5734.292

        [GRAPHIC] [TIFF OMITTED] T5734.293

        [GRAPHIC] [TIFF OMITTED] T5734.294

        [GRAPHIC] [TIFF OMITTED] T5734.295

        [GRAPHIC] [TIFF OMITTED] T5734.296

        [GRAPHIC] [TIFF OMITTED] T5734.297

        [GRAPHIC] [TIFF OMITTED] T5734.298

        [GRAPHIC] [TIFF OMITTED] T5734.299

        [GRAPHIC] [TIFF OMITTED] T5734.300

        [GRAPHIC] [TIFF OMITTED] T5734.301

        [GRAPHIC] [TIFF OMITTED] T5734.302

        [GRAPHIC] [TIFF OMITTED] T5734.303

        [GRAPHIC] [TIFF OMITTED] T5734.304

        Mr. Whitfield. Thank you very much.
        Dr. Thorning, we look forward to your testimony.

                      STATEMENT OF MARGO THORNING

        Ms. Thorning. Thank you, Mr. Chairman, and thank you,
    Ranking Member Rush, and I apologize for misidentifying in you
    my written testimony. I would like to correct that for the
    record.
        Thank you very much for the chance to appear before you. I
    just want to talk about five points in my testimony. First, the
    U.S. economy is recovering sluggishly. GDP grew only at 2.9
    percent last year. The unemployment rate remains stubbornly
    high at 9 percent. And investigation right now is about $354
    billion less than it was in the fourth quarter of 2007.
    Investment spending is responsible for most of the drop in
    gross domestic product over the last 2\1/2\ years or so. So
    clearly that is a key issue.
        Looking at the historical data, each $1 billion drop in
    investment spending is associated with a job loss of 15,500
    jobs, and vice versa. Each $1 billion increase is responsible
    for over 15,000 new jobs.
        The second point, regulating greenhouse gases under the
    Clean Air Act is likely to have a negative impact on overall
    business spending. When a business is contemplating a new
    investment, they look at the risk of that new investment. They
    may add a risk premium to their cost of capital, anywhere from
    zero to as much as 50 percent or more, assuming that the risk
    premium associated with investments that are in industries
    regulated by EPA might be 30 to 40 percent. We looked at the
    impact of that on business investment in the quarter or so of
    investment that is accounted for by these regulated entities
    that are regulated by EPA. We conclude that there could be a
    fall in investment spending annually of between $25 and $75
    billion. When you feed those numbers into IMPLAN, input-output
    model, you get--it is an input-output model that accounts for
    all the dollar flows across all sectors in the United States.
    When you feel those drops in investment which we assumed either
    $25 billion annually or $75 billion, you get a decrease in jobs
    of approximately 476,000 to, on the high side, 1.4 million
    fewer jobs annually and you get a loss of GDP of between 47
    billion and 141 billion annually. Interestingly, the job
    numbers that we obtained by looking at the historical data were
    about 15,5000 jobs tabulate very nicely with the IMPLAN results
    which suggest that for each $1 billion drop in investment, we
    lost about 17,000 jobs. So using two completely different
    approaches, we get the same impact for this drop in investment
    spending that we expect will occur as a result of these
    regulations.
        Fourth, mandating energy efficiency, as EPA seems to want
    to do under the BACT guidelines is unlikely to lead to job
    growth. First, as many companies testified in the panel just
    before us, they have already made energy efficiency
    investments. They do it when it makes economic sense, and when
    it is time to replace their capital stock if they can a more
    energy-efficient investment that makes sense, they do it. They
    don't need a government mandate to make them increase energy
    efficiency. And second, the argument that market failures and
    inefficiencies or technical barriers are responsible for
    companies not taking up energy-efficient investment is, I
    think, unfounded. Companies do make those investments. Overall,
    the results suggest that mandating energy efficiency is not
    going to be a net job generator.
        And fifth, the BACT guidelines issued in November are not
    likely to reduce uncertainty and they will not reduce the risk
    premium in the cost of capital that companies contemplating
    investment or expansion face because, for example, the specific
    standards for BACT are not established by the new guidelines.
    That means industries don't really know what will be required.
    And another example, the permitting agencies are required to
    retain discretion to determine BACT on a case-by-case basis
    subject to EPA or court review. Thus, regulated entities will
    encounter different requirements depending on the individual
    State regulator's approach.
        So in conclusion, I think using economic analysis, it
    suggests that regulating GHGs under the Clean Air Act is likely
    to slow investment, slow job growth and not have any impact on
    global greenhouse gas concentrations. Consequently, it makes
    little sense for EPA to proceed down this path. Thank you.
        [The prepared statement of Ms. Thorning follows:]

        [GRAPHIC] [TIFF OMITTED] T5734.305

        [GRAPHIC] [TIFF OMITTED] T5734.306

        [GRAPHIC] [TIFF OMITTED] T5734.307

        [GRAPHIC] [TIFF OMITTED] T5734.308

        [GRAPHIC] [TIFF OMITTED] T5734.309

        [GRAPHIC] [TIFF OMITTED] T5734.310

        [GRAPHIC] [TIFF OMITTED] T5734.311

        [GRAPHIC] [TIFF OMITTED] T5734.312

        [GRAPHIC] [TIFF OMITTED] T5734.313

        [GRAPHIC] [TIFF OMITTED] T5734.314

        [GRAPHIC] [TIFF OMITTED] T5734.315

        [GRAPHIC] [TIFF OMITTED] T5734.316

        Mr. Whitfield. Thank you, Dr. Thorning.
        Mr. Nelson, you are recognized for 5 minutes.

                       STATEMENT OF PHILIP NELSON

        Mr. Nelson. Mr. Chairman, members of the subcommittee, good
    afternoon. I am Philip Nelson. I am a fourth-generation grain
    and livestock farmer from Seneca Illinois. I am also President
    of the Illinois Farm Bureau and a member of the Board of
    Directors of the American Farm Bureau Federation. I am
    appearing today on behalf of the American Farm Bureau
    Federation.
        I am pleased to testify in support of the Energy Tax
    Prevention Act of 2011. It is one of several bills from both
    sides of the aisle in both the House and the Senate that are
    designed to allow our elected representatives in Congress to
    decide how and to what extent our Nation will address
    regulation of greenhouse gases. Farm Bureau opposes the
    regulation of greenhouse gases by the Environmental Protection
    Agency under the Clean Air Act and we commend the chairman for
    giving this matter a high priority.
        Farmers and ranchers receive a double economic jolt from
    the regulation of greenhouse gases from stationary sources.
    First, any costs incurred by utilities, refiners,
    manufacturers, and other large emitters to comply with the
    greenhouse gas regulatory requirements will be passed on to
    consumers of those products, including farmers and ranchers. To
    a large degree, farmers and ranchers cannot pass along these
    increased costs of production. Farmers and ranchers will also
    incur direct results as a result of the regulation of
    greenhouse gases by EPA. For the first time, many farm and
    ranch operations will likely be subject to direct new source
    review/prevention of significant deterioration construction
    permits and Title V permit requirements under the Clean Air
    Act. For example, Title V of the Clean Air Act requires that
    any stationary source including farms and ranches that emits or
    has the potential to emit more than 100 tons of a regulated
    pollutant per year must obtain an operating permit. To meet
    this requirement, thousands of farms and ranches will be
    required to obtain the Title V operating permits. EPA itself
    estimates that just at the expense of obtaining Title V
    operating permits, it will cost production agriculture $866
    million. That does not include other associated permit costs.
        Livestock producers would be especially impacted by these
    permit requirements. The USDA has stated that approximately 90
    percent of the livestock produced in this country are above the
    permitting thresholds and will be required to obtain operating
    permits. Under the EPA tailoring scheme, farmers and ranchers
    would still incur costs passed down from utilities and larger
    emitters upon which they depend for energy and fuel. Farmers
    and ranchers that meet the low Clean Air Act thresholds will
    also eventually be required to obtain permits.
        On the other hand, this costly and burdensome regulatory
    scheme will produce very little, if any, environmental benefit.
    Greenhouse gases are distributed evenly around the globe so
    that a ton of greenhouse gases emitted in Illinois is no
    different than a ton of greenhouse gases emitted in China.
    Regulation of greenhouse gases emitted in Illinois means little
    if emissions in China are not similarly regulated. Unless and
    until the countries of this world agree on an international
    treaty on greenhouse gas emissions, unilateral regulation of
    greenhouse gases by EPA will have little environment effect, a
    fact publicly acknowledged by the EPA Administrator. Both the
    President and the Administrator of EPA have stated that the
    regulation of greenhouse gases by EPA under the Clean Air Act
    is not an effective way to address the issue. Most state that
    they prefer that the issue be addressed by Congress.
        The Energy Tax Prevention Act recognizes this fact and
    applies the brakes to this process, thus restoring the
    jurisdiction of Congress to develop climate policy. Thank you.
        [The prepared statement of Mr. Nelson follows:]

        [GRAPHIC] [TIFF OMITTED] T5734.317

        [GRAPHIC] [TIFF OMITTED] T5734.318

        [GRAPHIC] [TIFF OMITTED] T5734.319

        [GRAPHIC] [TIFF OMITTED] T5734.320

        [GRAPHIC] [TIFF OMITTED] T5734.321

        [GRAPHIC] [TIFF OMITTED] T5734.322

        [GRAPHIC] [TIFF OMITTED] T5734.323

        [GRAPHIC] [TIFF OMITTED] T5734.324

        Mr. Whitfield. Thank you, Mr. Nelson.
        Mr. Harnack, you are recognized for 5 minutes.

                      STATEMENT OF FRED T. HARNACK

        Mr. Harnack. OK. Good afternoon. Mr. Chairman and members
    of the committee, thank you for this opportunity to testify. I
    will briefly summarize my remarks, and I am pleased to have
    supplied a detailed written statement for the record.
        My name is Fred Harnack and I am General Manager of
    Environmental Affairs for United States Steel Corporation. My
    career spans over 30 years in steel technology and
    manufacturing facilities, some of which are located in Mr.
    Dingell's and Mr. Doyle's districts. I have witnessed
    environmental management practices developed in tandem with
    implementation of the Clean Air Act. On balance, the Clean Air
    Act has been a force for positive change across industrial
    America.
        Today, I am especially proud to represent our company and
    over 21,000 domestic and 42,000 total employees at U.S. Steel.
    My company provides employees and their families good-paying
    jobs and benefits that make the American dream attainable. We
    also support pension and health benefits for more than 100,000
    retirees and their dependants. Ours is an industry worth
    fighting to keep.
        I assure you every one of us wants to work, live and raise
    our families in a clean and safe environment. We are committed
    to making steel with that in mind and install environmental
    stewardship through all our business processes. That said, we
    believe the time has come to reassess the complex framework of
    rules and regulations that hamstring responsible manufacturers
    and inhibit economic growth and job creation.
        U.S. Steel is an integrated steel producer. Our process
    begins with iron ore, carbon in the form of coke, and
    limestone. We transform these materials through a highly
    efficient, high-temperature blast furnace to create iron which,
    with the addition of recycled steel scrap metal, is converted
    to cast steel. We produce flat roll sheet and tin products and
    seamless and welded pipe that is used in automotive,
    construction, container and energy industry applications.
        As Congress looks for ways to reduce unemployment and
    attempt to recover more than 8 million manufacturing jobs lost
    since the year 2000, the regulatory burden will be a target-
    rich environment. The recent spate of new rules to regulate
    greenhouse gas emissions under the Clean Air Act is a good
    place to start because these rules have not yet had the chance
    to inflict their harm on jobs and the economy.
        Greenhouse gas emissions are not like the pollutants
    targeted under the Clean Air Act. Regulating these emissions
    from stationary sources under the existing Clean Air Act will
    not yield the past successes achieved for other pollutants. In
    fact, the Clean Air Act makes no provision to address the
    anticompetitive regulatory costs imposed on domestic
    manufacturers of globally traded goods. This will likely lead
    to a perverse outcome that puts the most efficient American
    manufacturers at a disadvantage to unburden foreign producers
    while actually contributing to a net increase in global
    greenhouse gas emissions. I am convinced that jeopardizing
    American jobs for a worse environment is not in our best
    interest.
        Our substantial experience complying with the Clean Air Act
    tells us that Title I and Title V programs were probably never
    intended to regulate global greenhouse gas emissions. In our
    world, this is the proverbial attempt to stick a square peg in
    a round hole. The committee's discussion draft dated February
    2, 2011, would prevent substantial economic harm by removing
    greenhouse gas emission regulations under the Clean Air Act.
        Over the coming months, we urge Congress to hold hearings
    on other aspects of the Clean Air Act. In this regard, we would
    suggest five areas worthy of your further study and
    investigation. These include first of all the cumulative impact
    of Clean Air Act regulations, and I just wanted to note that my
    written statement provides a detailed list of the many new and
    emerging air pollution rules applicable to and affecting the
    steel industry, and you have heard them many times referred to
    also today; secondly, the role and expectations including costs
    of technology in controlling various pollutants; third, the
    efficiency and effectiveness of U.S. EPA's guidance and testing
    methods; fourth, the best strategies for addressing multimedia
    and multipollutant impacts; and finally, staffing levels and
    competencies in the responsible State and federal regulatory
    agencies to ensure permitting can move with the pace of
    commerce.
        As Americans, we all understand that government regulation
    is designed to impose certain responsibilities on targeted
    entities. Our collective challenge, however, is to achieve an
    optimal balance of cost and benefit. When companies like mine
    are required to spend the lion's share of our capital budgets
    on infrastructure and satisfying compliance obligations, it is
    no wonder that job creation and America's global
    competitiveness are handicapped. We believe, as President Obama
    recently stated in his State of the Union address, that we have
    to make America the best place on earth to do business, and we
    at U.S. Steel are eager to help you achieve this worthy and
    rewarding goal.
        [The prepared statement of Mr. Harnack follows:]

        [GRAPHIC] [TIFF OMITTED] T5734.325

        [GRAPHIC] [TIFF OMITTED] T5734.326

        [GRAPHIC] [TIFF OMITTED] T5734.327

        [GRAPHIC] [TIFF OMITTED] T5734.328

        [GRAPHIC] [TIFF OMITTED] T5734.329

        [GRAPHIC] [TIFF OMITTED] T5734.330

        [GRAPHIC] [TIFF OMITTED] T5734.331

        [GRAPHIC] [TIFF OMITTED] T5734.332

        [GRAPHIC] [TIFF OMITTED] T5734.333

        [GRAPHIC] [TIFF OMITTED] T5734.334

        [GRAPHIC] [TIFF OMITTED] T5734.335

        [GRAPHIC] [TIFF OMITTED] T5734.336

        [GRAPHIC] [TIFF OMITTED] T5734.337

        [GRAPHIC] [TIFF OMITTED] T5734.338

        [GRAPHIC] [TIFF OMITTED] T5734.339

        [GRAPHIC] [TIFF OMITTED] T5734.340

        [GRAPHIC] [TIFF OMITTED] T5734.341

        [GRAPHIC] [TIFF OMITTED] T5734.342

        [GRAPHIC] [TIFF OMITTED] T5734.343

        [GRAPHIC] [TIFF OMITTED] T5734.344

        [GRAPHIC] [TIFF OMITTED] T5734.345

        [GRAPHIC] [TIFF OMITTED] T5734.346

        [GRAPHIC] [TIFF OMITTED] T5734.347

        [GRAPHIC] [TIFF OMITTED] T5734.348

        Mr. Whitfield. Thank you very much.
        Mr. Goldstene, you are recognized for 5 minutes.

                    STATEMENT OF JAMES N. GOLDSTENE

        Mr. Goldstene. Thank you. Good afternoon, Chairman
    Whitfield, Ranking Member Rush, members of the committee. I
    appreciate the invitation to speak today on the proposed Energy
    Tax Prevention Act of 2011.
        My name is James Goldstene. I am the Executive Officer of
    the California Air Resources Board, the primary body charged
    with protecting the air quality and air-related public health
    in California, and charged with speaking for the State on air
    quality and climate change issues. I am also a member of the
    Board of Directors of the National Association of Clean Air
    Agencies, or NACA, an associate of State and local clean air
    agencies across the country.
        Today I would like to share with my perspective as a State
    agency administrator and as an air quality regulator.
        The issue before us today concerns the preemption of the
    Clean Air Act, one of the most successful environmental laws in
    the history of the United States. For 40 years, the sensible
    pollution limits established under the Clean Air Act have
    dramatically improved air quality and public health, saving
    hundreds of thousands of lives and generating over $2 trillion
    in economic benefits for the American people. Let me start with
    vehicles. Passenger vehicles are not only responsible for 20
    percent of carbon pollution but the majority of our oil
    dependence. Preempting the authority for EPA to regulate the
    greenhouse gas emissions of vehicles would rob this country of
    one of its most powerful tools, not just to reduce carbon
    pollution but also to reduce our dependence on foreign oil, and
    to save consumers money.
        Simply maintaining the U.S. Department of Transportation's
    authority to regulate fuel efficiency is not adequate. While
    the fuel economy standards can complement long-term mobile
    source greenhouse gas reduction strategies, they are in no way
    a substitute for them. The combined fuel economy and vehicle
    greenhouse gas emission standards promulgated by EPA and DOT
    last year represent an important and unprecedented partnership.
    This approach leverages the strengths of both agencies and
    combines the related but different aspects of fuel economy and
    greenhouse gas emission standards. As a result, the combined
    standards achieve 35 percent less pollution and 25 percent less
    fuel consumption, compared to relying on CAFE standards alone.
        California embraced these joint standards and the national
    program wholeheartedly, accepting the federal program as
    equivalent to our own program for model years 2009 to 2016. We
    have continued to carry on this unprecedented spirit of
    cooperation and collaboration following the historic May 2009
    Rose Garden agreements, working with both federal agencies and
    automobile manufacturers to develop the next round of
    standards. California remains committed to the process of
    working closely with our partners to do everything we can to
    repeat that success for the 2017 to 2025 standards.
        We are building on a firmly established precedent and
    foundation of national environmental policy. Since the early
    1960s, California has established pollution standards for new
    vehicles sold in the State predating even the Federal
    Government's effort in this arena, and the pattern has
    continued. Since the 1980s, each successive California standard
    has gone on to become the national standard. In that time cars
    have become 99.7 percent cleaner, all while the auto industry
    has innovated to continue providing consumers with the amazing
    diversity and quality of affordable vehicles that we enjoy
    today. And of course, in this we are joined by our other
    States, the so-called section 177 States who have acted like
    California to address their own quality and public health
    concerns with our cost-effective standards. Preempting
    California's ability to set carbon pollution standards for
    vehicles would also increase costs to California consumers.
    These vehicle standards are one of the most cost-effective
    measures in California's clean energy plan, saving consumers an
    average of $2,000 over the life of a vehicle.
        With regard to pollution from electricity generators and
    factories, EPA is utilizing the tried-and-true framework for
    reducing pollution. Far from overreaching, EPA is responding to
    the clear mandate of the Clean Air Act, the dictates of the
    Supreme Court and fulfilling the clear intent of Congress that
    newly identified public health risks from air pollutants not
    listed in the Act be addressed. The obligation is clear and
    unambiguous.
        Contrary to claims of a rush to regulation, EPA has been
    proceeding methodically. Clearly, EPA has moved forward in the
    past 2 years with a tailored, measured approach. This
    permitting process is business as usual for State and local air
    quality agencies across the country who are using a well-known
    process that has been used for decades. EPA has provided
    flexibility for State and local agencies in how to run the
    permitting program so that the local regulators can work with
    the permit applicants. The claim that permitting would grind to
    a halt is simply false. All we want is to provide certainty for
    industry to invest and create jobs.
        This legislation, however, would forestall needed and
    available investment in the energy sector now and threaten the
    competitiveness of the American economy in the long run. We
    know that when government provides clear signals and a
    predictable regulatory environment, industry is quick to adapt,
    seize investment opportunity and create good jobs along with
    profits. For example, in the face of the current recession,
    clean technology has been the fastest-growing sector in
    California. Thank you, sir.
        [The prepared statement Mr. Goldstene follows:]

        [GRAPHIC] [TIFF OMITTED] T5734.349

        [GRAPHIC] [TIFF OMITTED] T5734.350

        [GRAPHIC] [TIFF OMITTED] T5734.351

        [GRAPHIC] [TIFF OMITTED] T5734.352

        [GRAPHIC] [TIFF OMITTED] T5734.353

        [GRAPHIC] [TIFF OMITTED] T5734.354

        [GRAPHIC] [TIFF OMITTED] T5734.355

        [GRAPHIC] [TIFF OMITTED] T5734.356

        Mr. Whitfield. Thank you, Mr. Goldstene.
        Dr. Goldman, you are recognized for 5 minutes.

                      STATEMENT OF LYNN R. GOLDMAN

        Dr. Goldman. Mr. Chairman, thank you so much for the
    opportunity to testify about this Act. My name is Lynn Goldman.
    I am Dean of the George Washington University School of Public
    Health and Health Services, a pediatrician and a professor of
    environmental and occupational health. Today I represent the
    American Public Health Association, or APHA. APHA is the
    Nation's oldest and most diverse organization of public health
    professionals in the world dedicated to protecting all
    Americans and their communities from preventable serious health
    threats and assuring community-based health promotion and
    disease prevention activities that are universally accessible
    across the United States. With your consent, I will place my
    written statement in the record.
        For 40 years, the Clean Air Act has safeguarded the health
    of all Americans including the most vulnerable. By EPA's
    estimate, the first 20 years of the Clean Air Act has prevented
    more than 200,000 premature deaths, 672,000 cases of chronic
    bronchitis, 843,000 asthma attacks and 189,000 cardiovascular
    hospitalizations, making it one of the most successful public
    health laws of our time.
        As you know, in 2007 the U.S. Supreme Court directed EPA to
    assess the science in order to decide whether or not to move
    forward with efforts to protect the public's health from the
    impacts of greenhouse gases. They did so, and they developed an
    endangerment assessment. It is because of this endangerment
    assessment and our knowledge about the public health effects of
    climate change that APHA opposes this legislation, and we are
    not alone in this position. In a December 6, 2010, letter to
    all Members of Congress, APHA was joined by the American Lung
    Association, the American Academy of Pediatrics, the American
    College of Preventive Medicine and other leading national and
    State public health, medical and clean air advocates in urging
    Congress to support moving forward with protective clean air
    standards and to oppose any measure that would delay or block
    progress toward a healthier tomorrow for all Americans.
        Climate change is a public health issue, and over time it
    is one of the greatest threats to human health. Scientists from
    across the globe have stated in the strongest possible terms
    that the climate is changing and that human activity is to
    blame. Scientists have unequivocally concluded that greenhouse
    gas is causing global warming and the United States is the
    leading contributor to these gases. The average increase in
    earth's temperature is causing extreme weather events and
    increases and decrease in temperature and rainfall. These
    regional weather changes may create environmental conditions
    like floods, heat waves, droughts and poor air quality that are
    not healthy. Some of the health effects we may be concerned
    about are strokes, injury, malnutrition, respiratory disease
    and asthma, and infections such as vector- and rodent-borne
    diseases. Huge costs and human suffering are associated with
    these outcomes. We are already beginning to see the health
    impacts worldwide. Impacts will only worsen if we continue to
    ignore this problem.
        I can recite more statistics, but let us take childhood
    asthma as an example. Already in the United States, asthma is
    the largest cause of hospitalizations and lost days of school
    for children but as a pediatrician, I also know the impacts of
    this disease on an individual child: a child who grows up
    unable to breathe without medication, unable to play outdoors
    like other children. Climate change is creating conditions that
    not only cause more asthma attacks but also can cause rates of
    asthma to rise in children. Moreover, the same activities that
    emit carbon dioxide also emit a wide variety of other
    pollutants that are harmful to health, pollutants like nitrogen
    oxides, air toxics and fine particulate matter. These
    pollutants also contribute to various diseases. Along with
    global warming, they contribute to formation of ground-level
    ozone. That is also unhealthy.
        So we do need regulations that control greenhouse gas
    emissions but these need to be written and implemented
    intelligently in a manner that also reduces exposure to other
    pollutants that might come from coal-fired power plants, that
    might come from automobiles. Control of pollution from power
    plants also increases the healthfulness of air in communities
    that are near those plants. These facilities are often closer
    to low-income communities that suffer disproportionately from
    air pollution.
        Measures to control air pollutants under the Clean Air Act
    need to work together as a whole to protect health. Cherry
    picking among these ignores the fact that health effects are
    associated with multiple classes and sources of pollution and
    is not consistent with science. Another way we can improve is
    by increasing energy efficiency. When we reduce our use of
    energy, we reduce emissions of the pollutants associated with
    energy and other harmful substances.
        In closing, I should say that this bill would do nothing to
    reduce uncertainty. There is a problem, a clear and present
    public health threat from climate change. There are no answers
    to this problem in this legislation. Until Congress is putting
    forward solutions, there will be a to of uncertainty in this
    country about where we are heading with this problem. Thank you
    very much.
        [The prepared statement of Dr. Goldman follows:]

        [GRAPHIC] [TIFF OMITTED] T5734.357

        [GRAPHIC] [TIFF OMITTED] T5734.358

        [GRAPHIC] [TIFF OMITTED] T5734.359

        [GRAPHIC] [TIFF OMITTED] T5734.360

        Mr. Whitfield. Thank you very much for your testimony. We
    appreciate once again your taking the time to be with us today.
        I would say, Dr. Goldman, that all the testimony I heard
    today made it very emphatically clear that there would be great
    uncertainty by EPA continuing to try to regulate greenhouse
    gases, and I would also say that on the light-duty motor
    vehicle standards which EPA has promulgated, this legislation
    would not change and affects model years 2012 through 2016.
    Now, the testimony has shown that that regulation is going to
    cost $52 billion to consumers in America and it is going to
    lower the temperature 90 years from now by maybe one one-
    hundredths of a degree. So what we are trying to do here is
    balance. We want to protect health, we want to protect
    environment, we want to protect jobs. We want to provide
    incentives for investment and we want to be competitive in the
    global marketplace.
        And Mr. Nelson, when Administrator Jackson was sitting
    right there, she said that the greenhouse gas regulations would
    really not impact the farming community, but from your
    testimony, I think you made it pretty clear that you would not
    agree with her statement. Is that correct?
        Mr. Nelson. That is correct. She made a couple comments
    that at this point in time it didn't impact it but our
    understanding, there are over 100 farm entities that do report
    to EPA at the present time, and----
        Mr. Whitfield. Well, as you said, it will certainly affect
    our electricity costs. There is no question about that. It will
    affect your fertilizer costs. There is no question about that.
        Now, the tailoring rule certainly would exempt many of you,
    but Mr. Glaser, that tailoring rule, Mr. Glaser, the tailoring
    rule is an explicit violation of the specific language of the
    Clean Air Act, isn't it?
        Mr. Glaser. I don't see how you could be any more clear in
    the statute than by using a number.
        Mr. Whitfield. Yes, and the number says 100 or 250 tons per
    year.
        Mr. Glaser. One hundred or 250. It doesn't say 100,000.
        Mr. Whitfield. And she says 100,000. Now, have lawsuits
    been filed against the tailoring rule?
        Mr. Glaser. Yes, they have.
        Mr. Whitfield. And have lawsuits been filed against EPA's
    allegation that the fact that they were required by the Supreme
    Court to look at this issue on mobile sources because they
    found an endangerment finding there that they are automatically
    required to regulate stationary sources. Has there been a
    lawsuit filed on that?
        Mr. Nelson. Yes. I mean, I have to say that what has gone
    on is again, as one of the witnesses said, when you try to jam
    a square peg into a round hole, you end up with a great deal of
    legal uncertainty and you end up with a great number of
    lawsuits including EPA's contention that by finding that
    automobile emissions endanger public health and welfare and
    therefore regulating automobiles, you then automatically have
    to regulate stationary sources. That is also uncertain and
    doesn't seem to be a logical reading.
        Mr. Whitfield. And I might say, we are certainly not trying
    to gut the Clean Air Act in any way. We are trying to break the
    logjam which was written by a former legal counsel for the
    National Resources Defense Council, and he says in this book
    that the Clean Air Act was never meant to regulate greenhouse
    gases and it does not work in doing so.
        Now, Ms. Jackson also admitted today that there is no
    technology available to deal with greenhouse gases and that her
    rules would not in any way meaningfully reduce greenhouse
    gases. But she did say we are going to require efficiencies to
    be adopted by stationary sources, and then some people have
    said well, there is nothing wrong with that, that is
    reasonable, and that is reasonable. I am assuming, Mr. Harnack,
    that most businesses want to be as efficient as they can be and
    they don't need government bureaucrats telling them to do that.
    Is that correct or not?
        Mr. Harnack. I mean, in our case, that is correct. We have
    done a lot of energy efficiency projects. We have a corporate
    energy efficiency initiative that has been in place for many
    years now, and we think that we have captured a lot of the low-
    hanging fruit. Some of the challenges now is that some of the
    projects that we have just do not have suitable return for us
    to invest very limited capital in based on our situation and
    the business climate right now.
        Mr. Whitfield. But they seem to be working on the premise
    that in order to be efficient, the government regulators have
    to tell you to be efficient and how to do it, and if the State
    regulators make a ruling that you should do it this way to meet
    these standards, EPA is not precluded from coming back later
    and disagreeing with that and making you even change that. Is
    that right, Mr. Glaser?
        Mr. Glaser. Yes, I completely agree with that. Yes, sir.
        Mr. Whitfield. Well, my time has already expired, so Mr.
    Rush, I recognize you for 5 minutes.
        Mr. Rush. Mr. Nelson, as a fellow Illinoisan and as a
    supporter of Illinois farms, I certainly want to welcome you
    here to this subcommittee, and I understand your concerns about
    potential impacts on small agricultural operators if EPA had
    not adopted the tailoring rule. Requiring permits for these
    sources makes no sense. That is why I was pleased to hear
    Administrator Jackson assure us earlier today that the
    tailoring rule avoids any energy and greenhouse gas
    requirements on small sources including farms. Did you hear her
    say that?
        Mr. Nelson. She did allude to that, but I think the one
    thing to keep in mind when she was talking about agriculture,
    we are big consumers of energy and we rely on energy so if
    indeed you were to put undue regulations on some of the inputs
    that we utilize in agriculture, it has a tremendous impact on
    production agriculture.
        Mr. Rush. Well, and being consistent with her testimony,
    does any farm have to report under the greenhouse gases
    reporting rule?
        Mr. Nelson. Well, it would depend on a number of things. If
    you were not reclassified, and we looked at stationary sources,
    livestock would fall under that category as it stands right
    now. We have asked that of the EPA of whether they are going to
    reclassify stationary sources as it relates to agriculture.
    They have not done it as of now. Being a livestock producer, it
    creates a huge burden when you look at the dollars that we are
    talking of assessing livestock operations just to stay in
    business.
        Mr. Rush. But as of today, there is no farm that you are
    aware that has to report under the greenhouse gas reporting
    rule as of today, as it stands right now?
        Mr. Nelson. As it stands right now, some of those that fall
    into a certain category, there are approximately 100 based on
    what we know that do report to the EPA.
        Mr. Rush. The regs went into effect on January 2nd of this
    year. You said there are at least 100 farms who are now subject
    to these rules. Is that what you are saying?
        Mr. Nelson. Yes, and if you require a manure management
    system, they do report as of now.
        Mr. Rush. I want to switch my questioning to Dr. Goldman.
    Dr. Goldman, do you believe that it is appropriate for Congress
    to pass legislation that substitutes Congress's views that
    carbon pollution does not endanger public health for your and
    other scientists' interpretation that carbon pollution does
    endanger public health?
        Dr. Goldman. No, I don't believe that would be appropriate.
        Mr. Rush. Can you be more concise and tell the subcommittee
    why you support the Clean Air Act and the steps that the EPA is
    taking to put limits on carbon pollution?
        Dr. Goldman. I support it because at this point in time it
    is the only method that the EPA has for being able to deal with
    this very clear and present threat, and that is the Clean Air
    Act and the emissions that cause global warming are air
    emissions and they can be regulated under the Clean Air Act,
    and EPA has been able to make clear public health findings that
    indeed they are threatening the Nation's health.
        Mr. Rush. Thank you. Mr. Chairman, I yield back.
        Mr. Whitfield. Yes, sir. Mr. Shimkus, you are recognized
    for 5 minutes.
        Mr. Shimkus. Thank you, Mr. Chairman, and I am just going
    to go quick, but in response to Dr. Goldman's response to the
    question, the elected representatives have never passed any
    piece of legislation that has been signed into law to regulate
    greenhouse gas. I am not asking for a response, I am just
    telling you, the elected representatives, the people who send
    us here from our districts, we have never, we have never passed
    legislation that has gone into law to regulate greenhouse gas
    emissions.
        If you would put up the picture on the slide there, this is
    for my colleague from Illinois, my friend, Mr. Nelson. This is
    kind of going off script on greenhouse gases. But Phil, tell me
    what is going on there.
        Mr. Nelson. That is a harvest operation, I believe
    combining soybeans.
        Mr. Shimkus. And that smoke in the back, what is that? Is
    that dirty petroleum product?
        Mr. Nelson. No, that is dust.
        Mr. Shimkus. Dust made up of?
        Mr. Nelson. Basically material coming off the plant after
    it is----
        Mr. Shimkus. Dried leaves, stems. They keep the beans and
    spread out the chaff, what we would call it.
        Mr. Nelson. That is correct.
        Mr. Shimkus. Is there not a fear from the agricultural
    community that the EPA is moving to regulate that activity?
        Mr. Nelson. Yes, there is, and as a matter of fact, I made
    the comments many times if you look even at the Kyoto Protocol,
    we would have to equip our harvest machines with dust
    collectors if you were going to take it to the nth degree.
        Mr. Shimkus. Which would be additional capital expense or
    maybe a water trailer and water it down to collect chaff,
    chaff. This is dust from leaves and stems in agriculture. That
    is pretty close to my home, and I took that as I was driving
    back from taking my kids. He was in the field. I pulled off on
    the side, took about five photos. I took that around in
    October, the election year, to the Farm Bureau meetings and
    held it up on my phone and said this is what--this is what we
    have in an EPA gone awry when they are going to spend time,
    effort, energy regulating chaff, and of course, in my
    congressional district, the people are just unbelievably
    astounded that we would do such a thing. So thank you for that.
        Let me just ask, does uncertainty raise the cost of
    capital? This is just a traditional, just a business question.
    Dr. Goldman, does uncertainty raise--you may not know. Does
    uncertainty raise the cost of borrowing money?
        Dr. Goldman. Not in my area.
        Mr. Shimkus. The answer is, it definitely does. It raises
    the interest, the rate on raising capital. So the reason why I
    ask this question is because certainty is what everybody is
    talking about. Mr. Goldstene says this produces more certainty.
    This greenhouse gas regulation is good for business. We have
    more certainty. That is correct, right? That is your testimony?
        Mr. Harnack, do you want to respond? Do you have more
    certainty today in U.S. steel production or less?
        Mr. Harnack. Definitely less, and the one thing----
        Mr. Shimkus. So the cost of capital increases for
    expansion?
        Mr. Harnack. The cost of capital is something that we know
    that there is not an alternative to the integral steel process
    presently, and the fact that we require carbon to create new
    steel, and the integrated process is slightly different than
    the electric furnace process because the electric furnace
    process----
        Mr. Shimkus. Go quickly.
        Mr. Harnack [continuing]. Requires recycled scrap. We mine
    ore that is required to make new steel, and there is not enough
    recycled scrap in the world to provide steel for all the
    applications.
        Mr. Shimkus. So this creates more uncertainty for your
    business?
        Mr. Harnack. Yes.
        Mr. Shimkus. And is there more uncertainty for the Chinese
    steel mill or less?
        Mr. Harnack. It doesn't apply to them.
        Mr. Shimkus. So there is less uncertainty, lower cost of
    capital for Chinese steel which would make Chinese steel more
    competitive in this country, another aspect.
        Mr. Nelson, in the agriculture community, more uncertainty
    or less?
        Mr. Nelson. Absolutely more, and you look at our
    competitors in South America and Europe that we compete
    against, and you just--the fear of the unknown about how many
    more undue regulations are going to make us more uncompetitive
    in the environment that we are a part of.
        Mr. Shimkus. Let me go to our economist. More uncertainty,
    less, Dr. Thorning, this premise on how we create jobs, how do
    we raise capital?
        Ms. Thorning. Well, I think definitely more uncertainty,
    and the BACT rules released in November really don't help, so I
    think it is pretty clear that this regulation will have a
    negative impact on jobs and economic growth.
        Mr. Shimkus. Thank you very much.
        Mr. Whitfield. Thank you, Mr. Shimkus.
        I recognize the gentleman from Michigan, Mr. Dingell, for 5
    minutes.
        Mr. Dingell. Mr. Chairman, I thank you for your courtesy.
        This question is to Mr. Goldstene. Does CARB plan on
    finalizing California GHG emissions standards before the
    federal standards are finalized? Yes or no.
        Mr. Goldstene. Yes.
        Mr. Dingell. Thank you. Now, would you tell me and explain
    for the record how you and your staff have already stated fuel
    economy goals of 50 to 62 miles per gallon before the
    information and analysis that is available to complete that
    process has been made available to the commission?
        Mr. Goldstene. Congressman, we have made a public
    commitment just recently that we are going to wait to propose
    our rule until the beginning of September, which is the same
    time that DOT and EPA will propose their rules. We have not
    made any public announcements that we have chosen or predecided
    what the standard should be. We have been discussing a range of
    standards in public workshops, and I think that is maybe where
    you are hearing that.
        Mr. Dingell. So what you are telling me is, you have stated
    the fuel economy goals are going to be 50 to 62 miles per
    gallon before you have gotten the information and the analysis
    necessary to complete the process. Is that right?
        Mr. Goldstene. No, sir, that is not what I am saying. I am
    saying that----
        Mr. Dingell. Well, what are you telling me then, please?
        Mr. Goldstene. What I am saying that is that we are working
    with DOT and EPA on a series of studies. We are waiting to
    complete those studies, which are going through peer review,
    and we will use all the information----
        Mr. Dingell. I only have 34 seconds here.
        Mr. Goldstene. Sorry.
        Mr. Dingell. Have you gotten the information and the
    scientific work done to support those numbers? Yes or no.
        Mr. Goldstene. We have a lot of information that is being
    peer reviewed.
        Mr. Dingell. Do you have the information that would support
    that statement in proper form to stand a judicial review?
        Mr. Goldstene. We may. It depends on what the final peer-
    reviewed studies say and what we----
        Mr. Dingell. Thank you very much.
        Mr. Goldstene [continuing]. Propose as a regulation with
    DOT and EPA.
        Mr. Dingell. We had a little trouble getting the answer but
    I do thank you for your kindness. Now, does CARB conduct
    analysis on job impact and economic consequences of the
    standards that it is considering?
        Mr. Goldstene. Yes.
        Mr. Dingell. Would you please submit that analysis on the
    fuel efficiency standards that you are suggesting for purposes
    of the record, please?
        Mr. Goldstene. We would be happy to. We haven't completed
    them for the new set of standards. We have them for the prior
    standards.
        Mr. Dingell. Now, would you tell us about the extent of
    CARB's safety expertise? What safety expertise do you have? Do
    you have any responsibility under the California statutes to
    deal with the question of safety or not?
        Mr. Goldstene. No, but that is why we are working with DOT.
        Mr. Dingell. Thank you.
        Mr. Goldstene. And we have jointly funded a study on this
    issue.
        Mr. Dingell. Thank you very much. Now, 2 days ago, CARB
    sent letters to the CEOs of all the automobile alliance asking
    them to distance themselves from the alliance's complaint in a
    letter to Chairman Darrell Issa that the CARB was moving
    unilaterally forward in regulatory process. CARB disputes that
    claim by saying, ``We recently issued a joint statement with
    EPA and NHTSA promising that we would release proposals for the
    next set of GHG standards and NHTSA's on the same date
    September 1, 2011.'' Now, yes or no, isn't it true that CARB
    made a joint statement on timing with EPA and NHTSA only after
    the alliance sent the aforementioned letter to Chairman Issa
    and only after CARB received a letter and only after the Obama
    Administration in response to the letter asked CARB to stop
    getting out in front of the federal process? Yes or no.
        Mr. Goldstene. There are a lot of questions there. We have
    been working with EPA, DOT and the White House on the next
    round of standards, and all along we have been making public
    statements and commitments that we would not get out ahead of
    our partners at EPA and NHTSA.
        Mr. Dingell. Let me read this again. Two days ago, CARB
    sent letters to CEO members of the auto alliance asking them to
    distance themselves from the alliance's complaint in a letter
    to Chairman Darrell Issa that the CARB was moving unilaterally
    forward in the regulatory process. Is that true or false?
        Mr. Goldstene. We sent a letter to the CEOs----
        Mr. Dingell. Good.
        Mr. Goldstene [continuing]. Saying--being critical of the
    alliance letter to Congressman Issa. Yes.
        Mr. Dingell. The answer to that is yes. Please, I have
    limited time. Now, CARB disputes that claim by saying, ``We
    recently issued a joint statement with EPA and NHTSA promising
    that we would release proposals for the next set of GHG
    standards and NHTSA's on the same date September 1, 2011.'' Is
    that true?
        Mr. Goldstene. That is true.
        Mr. Dingell. OK. Now----
        Mr. Goldstene. But that is not new. That was just putting
    in writing what we have been saying all along.
        Mr. Dingell. Please. May I continue?
        Mr. Goldstene. Yes, sir.
        Mr. Dingell. Isn't it true that CARB made the joint
    statement on timing with EPA and NHTSA only after the alliance
    sent the aforementioned letter to Chairman Issa and only after
    CARB received the letter and only after the Obama
    Administration in response to the letter asked CARB to stop
    getting in front of the federal process?
        Mr. Goldstene. It is true that we sent the letter after the
    alliance sent their letter.
        Mr. Dingell. Thank you. Now, would you tell us if it is
    your view that global warming problems should be dealt with
    under the Clean Air Act or is there a better way of dealing
    with it?
        Mr. Goldstene. The Clean Air Act is the tool we have, the
    tool that EPA has.
        Mr. Dingell. But is it going to be simple and easy to do?
    Is it going to be relatively free from litigation and questions
    or is it going to be a very complex grind where you will have a
    number of different options and might wind up with quite
    different standards for different things in different States?
        Mr. Goldstene. I think that the EPA is hoping to avoid that
    by using their power under the Clean Air Act.
        Mr. Dingell. I know, but are they going to be able to, in
    your opinion?
        Thank you, Mr. Chairman.
        Mr. Goldstene. I think there is a way to make sure that you
    make the rules as easy to understand nationally as possible,
    and we have proven that over and over again through the
    adoption of our clean car standards in California that get
    adopted then by other states and ultimately the Federal
    Government.
        Mr. Whitfield. I recognize the gentleman from Michigan for
    5 minutes.
        Mr. Dingell. You have been very kind, Mr. Chairman. Thank
    you.
        Mr. Upton. Thank you, Mr. Chairman. I will confess that
    several years ago I voted against cloning, and days like today,
    I wonder why as I have been in a number of different events and
    I was sad to miss the testimony by all of you during this
    panel, but I have a couple of questions.
        Dr. Thorning, you indicated--and I talked to the earlier
    panels, in Michigan these regulations have been predicted to
    reduce our GDP by $18 billion, destroy 96,000 jobs, reduce
    household incomes by nearly $1,600. In your testimony, I
    believe, or in response to a question, you talked about a model
    that showed by 2014 that $25 to $75 billion decrease in capital
    investment would in fact result in an economy-wide job loss of
    somewhere between 476,000 and 1.4 million when direct and
    indirect and induced effects are included, and as a result, GDP
    would be $47 billion to $141 billion less in 2014. Can you
    expound a little bit about how you came up with those numbers?
        Ms. Thorning. Yes. Looking at the regulated industries that
    are initially going to come under EPA's regulations, we
    concluded that those represented about--that the investment in
    those industries normally represents about 25 percent of all
    U.S. investment on an annual basis, and then we did some
    research on how the risk premium for investment in those
    industries might be impacted by the uncertainty surrounding EPA
    regulations, the tailoring rule, whether it will stand, so
    forth, and we concluded that the risk premium probably would
    increase between 30 and 40 percent for those industries.
    Therefore, if those industries represent approximately 25
    percent of all investment, we concluded that that would
    represent looking at historical data a decrease in investment
    of between $25 billion a year and $75 billion a year.
        Now, remember that overall gross private domestic
    investment is like $1.7 trillion, so we thought that was a
    pretty conservative estimate and we used a conservative
    estimate of the elasticity of response to investment to changes
    in the cost of capital, and we ran through that the IMPLAN
    model, which is a near-term model good for short-term
    predictions, not good for long-term predictions, it produced
    results with the direct, the induced and the ancillary impacts
    of nationwide job reduction compared to the baseline forecast
    of between 476,000 fewer jobs to as many as 1.4 million fewer
    jobs in the year 2014, and of course, some industries are more
    impacted than others, and GDP of approximately $47 billion
    smaller to $141 billion smaller, and this is just targeting
    these industries right now that are impacted and the large ones
    that are included in EPA's current regulatory regime.
        Mr. Upton. Thank you.
        Mr. Goldstene, in announcing his new Executive Order on
    regulations, President Obama cited one national program as a
    good example of eliminating a tangle of regulations. The tangle
    was the result of three different agencies--NHTSA, EPA and
    CARB--trying to regulate basically the same thing. One national
    program eliminated the tangle for 2012 through 2016 by getting
    EPA and NHTSA to coordinate with each other and by California
    agreeing to defer to the federal regulations. It now appears
    that for 2017 and beyond, we are in the process of re-creating
    the tangle that the one national program eliminated since
    California is planning to promulgate a new set of GHG regs. Why
    shouldn't it be that California agree that from now on there
    will be a national program consisting of NHTSA and EPA
    regulations only? Why does California need to duplicate or move
    forward with a different plan?
        Mr. Goldstene. Mr. Upton, as you know, California has a
    special mention in the Clean Air Act because our air quality
    problems have been so severe over the years and they are still
    severe in certain areas of the State like in Los Angeles and
    the central valley. So from the perspective of a State that
    still has significant air quality problems, we have to fight to
    keep our authority to promulgate the rules that are needed to
    protect the public health, and these vehicle standards are one
    of the ways that we do that. We are sometimes or often joined
    by other States under section 177 that can use our rules if
    they choose to and that sometimes creates what the auto
    industry had called a patchwork quilt, but the fact is, at most
    you would only have two standards, and over the past 40 years
    what we have seen over and over again is that if the two
    standards become one relatively quickly, and that is what just
    happened with the 2012-2016 standards, and this time unlike
    before, we are working very closely with EPA and DOT, using the
    same information, relying on the same peer-reviewed studies,
    and working hand in hand on developing and designing our rules.
    They may come out slightly differently. Our process is slightly
    shorter, so we may complete our process before EPA and NHTSA
    finish their processes but we are fully committed to
    harmonizing them as soon as they are done.
        Mr. Whitfield. Ms. Capps, you are recognized for 5 minutes.
        Ms. Capps. Thank you, Mr. Chairman, and I want to start
    out, I have questions for you, Mr. Goldstene, and also one for
    Dr. Goldman, and as someone who represents a district in
    California where we can look out to see whether the brown haze
    is coming up from the L.A. basin on certain days and have lived
    there long enough to notice the rise as a former school nurse
    of school-age asthma and being aware that there were certain
    days in the L.A. basin when frail adults were told to stay
    inside and kids couldn't go out on the playground. That is one
    of the special things about living in our State and why I am so
    appreciative of the work that you as Executive Officer of the
    California Air Resources Board, or CARB, and I want to tell
    you, I appreciate the regulation of the marine vessels, which
    have added a great deal to their air quality in my part of the
    State and all along the coastal areas.
        You have some--we have been hearing today about the fact
    that addressing climate change will destroy the economy. You
    have some practical experience because California is well
    underway in implementation of a State law to conduct carbon
    pollution. Can we cut carbon pollution, Mr. Goldstene, without
    harming the economy? In a few words.
        Mr. Goldstene. Yes, we can. We have also run economic
    analysis like the kind that Dr. Thorning described using
    macroeconomic models, and we have used a model called EDRAM and
    BEAR. I am sure Dr. Thorning knows those models. And what we
    have shown overall in the California economy is there is a very
    slight net positive with climate regulations under our plan
    economically.
        Ms. Capps. Thank you. And a very brief assessment of how
    workable EPA's approach is.
        Mr. Goldstene. I think it is very workable. I have been
    here all day, and I have seen the complaints, but the fact is,
    I think most of the claims and worry while the worry is real, I
    think when you look at the specific details, for instance, the
    cost of capital, the cost of capital is influenced by many,
    many factors, not just by the possibility of a regulation.
        Ms. Capps. And you are also a member of the board of
    directors for the National Association of Clean Air Agencies.
        Mr. Goldstene. Yes.
        Ms. Capps. Just a couple words on your understanding of
    whether other States are finding EPA's approach to be workable
    as you talk with people from other States.
        Mr. Goldstene. Yes. There are many States that are
    embracing EPA's process and effort. Of course, there are States
    that are also concerned about it but I think on the whole----
        Ms. Capps. Overall, are we moving in the right direction?
        Mr. Goldstene. Overall, it is moving in the right
    direction, but I do think people in other States, my colleagues
    and the governors in many other States see the potential for
    the great economic innovation that can come from this and job
    creation that can come from this kind of rulemaking.
        Ms. Capps. Thank you, Mr. Goldstene.
        Dr. Goldman, I recently heard a story about back when the
    Clean Air Act was first being debated on the House floor. One
    Congressman quoted a mayor, and this is the quote: ``If you
    want to make this town grow, it has got to stink.'' I think
    that has been proven wrong. Our economy has not shriveled over
    these past years of trying to improve the air quality. Instead,
    the GDP has grown 207 percent. My question to you representing,
    as you do, the American Public Health Association, can you
    please share with us the health benefits and really the
    economic benefits as a result of responsible limits to
    greenhouse gases, the approach the EPA is taking?
        Dr. Goldman. The benefits are potentially quite enormous,
    and what we are looking at in terms of threats from climate
    change have to do with health impacts from adverse weather
    events like flooding and drought, adverse health impacts from
    dirty air, and also adverse health impacts form changing the
    distribution of disease-bearing vectors like insects and
    rodents, and these are all enormous threats. I think the most
    immediate ones that we are seeing have to do with the
    increasing frequently of severe weather events which have a
    major impact on people's health.
        Ms. Capps. And with that, I am going to yield back the
    balance of my time.
        Mr. Whitfield. Thank you, Ms. Capps.
        Mr. Scalise, you are recognized for 5 minutes.
        Mr. Scalise. Thank you, Mr. Chairman. First a question for
    Mr. Nelson with Farm Bureau. I appreciate you being here to
    discuss the importance of the impact of greenhouse gas
    regulations and how they would impact specifically the
    agriculture industry. I know you know the essential role that
    the agriculture industry plays in America's way of life but
    also especially as it relates to our economy and the small
    businesses that are such the heart of the agriculture industry.
    I represent a part of southeast Louisiana. We have a larger
    presence of dairy farmers, in my district, and really concerned
    about the impact that EPA regulations would have on these small
    businesses, you know, especially as Administrator Jackson has
    talked about potentially down the road doing some things there.
    The dairy industry in Louisiana contributes about $115 million
    to Louisiana's economy, and those proposed EPA regulations
    would devastate many of these small businesses who literally
    are operating on the margins. I think you were here when the
    Administrator was giving her statements, but since the EPA
    Administrator has left the door open to regulation of the
    agriculture industry, can you speak specifically to how it
    would potentially affect especially those small dairy farms in
    districts like mine and yours in Illinois and throughout the
    country?
        Mr. Nelson. Well, really I would address it two different
    ways. You have to look at the livestock industry and what is
    being proposed or thrown out there in regards to a Title V
    permit if isn't reclassified. It will have a tremendous impact
    on the dairy industry. I think the numbers that we are looking
    at, you know, are $175 for a dairy cow, which you just cannot
    make any money----
        Mr. Scalise. But it would cost an additional $175 per dairy
    cow if those EPA restrictions were put in place?
        Mr. Nelson. That is correct.
        Mr. Scalise. Gee, whiz.
        Mr. Nelson. And not only that, then you look at the
    production side of things as Congressman Shimkus alluded to,
    the threats are out there as far as dust permits. We have got a
    couple States right now that can't even deal with the dust
    standards as it is proposed today, let alone try to make those
    twice as stringent as what we are hearing coming out of the
    Administration. So it really impacts a number of facets of
    agriculture if these regulations proceed forward and are put in
    place.
        Mr. Scalise. And that seems to actually go in sync with
    some of the statements that were made on the previous panel.
    Mr. Alford, who is the President and CEO of the National Black
    Chamber of Commerce, had given some testimony and he talked
    about a number of impacts, and they had done a study, and one
    thing he looked at, on the poorest 20 percent of our
    population, he said this kind of scheme by EPA would increase
    the cost of home energy by 45 percent, motor fuel by 25
    percent, and he said it would also increase groceries by 35
    percent on our Nation's poorest families. So can you talk
    about, especially from the agriculture industry, what would the
    impact of a 35 percent increase in food prices on our poorest
    families in this country have?
        Mr. Nelson. Right now, consumers have probably the best
    bargain in the entire world where we spend about 10 cents out
    of every disposable dollar for food. You look at Japan and some
    of the other developed countries that do have regulatory
    frameworks that could parallel some of the things that are
    being proposed by this Administration, so you could easily make
    the case of doubling what we pay for food.
        Under Waxman-Markey, we had a lot of sensitivity with that
    bill as it related to what it would do to food prices, what it
    would do to energy prices if you didn't sight the nuclear power
    plants, if you took almost 59 million acres out of production,
    row crop agriculture, what that would do to the consumer and
    the grocery store. So, you know, it is going to have a dramatic
    impact if indeed we don't use some common sense to try to look
    at a regulatory framework that is workable without really
    impacting our industry to the degree that----
        Mr. Scalise. Thank you. And I know we are trying to get EPA
    to look at the job loss impact of all of the things that they
    are doing in these regulations but I would be curious to see if
    EPA is going to do an impact on the lives that would be lost if
    you had a 35 percent increase in the food that our poorest
    families by where you literally would be taking food of the
    table of American families because of these regulations on the
    agriculture industry.
        Ms. Thorning, I know I am running low on time but Ms.
    Thorning, I am not sure if you had seen the study that we have
    seen on the Spain experiment with this kind of, you know, this
    cap-and-trade scheme where they regulate and they talked about
    all the green jobs that I would create, and of course it turned
    out in Spain after they looked at it, all of the promises of
    those new jobs turned out to be a mirage and they ended up
    losing two jobs for every job they created and in fact for each
    new job they created, only 10 percent were actually permanent
    jobs, so in essence, you lost 20 full-time jobs for every real
    job that you created in this industry. Have you looked at any
    of those studies?
        Ms. Thorning. Yes, I have seen that study. There is also
    one done by a German think tank that looks at the cost of solar
    energy and electricity prices in Germany. There is one in
    Denmark that shows the same thing. The issue is, when you
    substitute more expensive energy for cheaper energy, you might
    gain some jobs in that sector, you know, the green energy
    sector but you are going to lose them overall because you are
    making other products, other producers pay a lot more for
    energy, and that finding is mirrored in the work that groups
    like ours have done with the Department of Energy's own NIMS
    model analyzing Waxman-Markey, Kerry-Lieberman. We always get
    some more green jobs because, you know, we are forcing quicker
    uptake of energy efficiency but overall the macro models show
    job loss, and that is a similar conclusion that you have got--
    --
        Mr. Scalise. Thank you, and I yield back, Mr. Chairman.
        Mr. Whitfield. Mr. Doyle, you are recognized for 5 minutes.
        Mr. Doyle. Thank you, Mr. Chairman. First, let me commend
    you and the ranking member for your stamina and the panel for
    your patience, and welcome to all of you. I want to especially
    welcome Fred Harnack from U.S. Steel. Just by way of full
    disclosure, Fred and I go back quite a bit. He started out at
    Edgar Thompson, where my father worked for 30 years. Then over
    to the Homestead Works plant, an urban plant in West Mifflin
    and Mon Valley Works, and Fred probably has an incredible
    knowledge of my congressional district and the steel industry,
    which are two things that I hold near and dear to my heart, and
    I suspect that we were both crying in our Iron City beers a
    little bit on Sunday after that game was over, but Fred, it is
    good to have you here.
        You know, I follow the steel industry's performance
    closely, and I am certainly aware of the current difficulties
    that integrated steel mills face. We know the cost of raw
    materials has gone up greatly and that continues to affect the
    performance of manufacturers, and also it is an industry that
    is uniquely affect by it has international trade pressures too.
    This is why as we were trying to develop a comprehensive energy
    bill, that we were particularly sensitive about those things
    and tried to put language in the bill that would address some
    of the pressures that industries like steel had that were
    carbon intensive but had trade pressures too.
        On the earlier panel, I talked to Administrator Jackson and
    I asked her how this new greenhouse gas permitting process
    would affect facilities like steel mills, and Fred, I wonder if
    you can tell me right now what capacity U.S. Steel is currently
    operating at?
        Mr. Harnack. Presently we are probably somewhere between 75
    and 80 percent. We do have one plant idled and a number of
    other facilities are not as full as we would like them to be.
        Mr. Doyle. So, you know, all of us are hoping that the
    industry reaches a point where you are able to ramp up to 100
    percent of our operating capacity but assuming you were able to
    ramp up to 100 percent of your operating capacity, would U.S.
    Steel be required to apply for a greenhouse gas permit to cover
    the increased activity?
        Mr. Harnack. Presently, we are doing the greenhouse gas
    report that is required. We only need to file for the permits
    that are above the threshold, and right now that exists only in
    our expansion plans in our Minnesota ore operations. The
    balance of the facilities are permitted for the capacity that
    we publish, and there would not be any additional needs to
    permit for that at this time.
        Mr. Doyle. Right. So in other words, any existing facility
    right up to your full capacity, you wouldn't be affected by
    this, only if you had an addition, if you put up a new plant or
    if you expanded a current facility and got over that limit that
    would require a permit?
        Mr. Harnack. That is right, based on the present regulatory
    requirements.
        Mr. Doyle. So your plants that are currently operating in
    the United States, are any of them going to have to apply for
    renewals under their Title V permits for non-greenhouse gas air
    pollutants under the Clean Air Act?
        Mr. Harnack. There is--yes, we do have periodic permit
    renewals. Actually we are working on two in Allegheny County
    right now as well as have just recently obtained them in our
    Alabama operation.
        Mr. Doyle. Now, when you apply for these renewals, will
    your new permit have to include any pollution controls for
    greenhouse gases?
        Mr. Harnack. We will be required to provide all the
    regulatory information and regulatory requirements as it
    develops, you know, by the EPA and the government.
        Mr. Doyle. So you have to report your emissions but you are
    not required to implement any new control technologies as long
    as you are not expanding your current capacity?
        Mr. Harnack. Only on the newly permitted facilities that
    are above the threshold.
        Mr. Doyle. So as we speak today, even though you are going
    through Title V permit renewals, this would not require you in
    your existing facilities other than to report to EPA wouldn't
    require you to implement any new control technologies?
        Mr. Harnack. That is right.
        Mr. Doyle. So it seems to me as we look at these rules and,
    you know, today we are focusing--I mean, this rule focuses
    primarily under the tailoring provision coal-fired and fossil-
    fired utility plants and oil refineries. Right now this has no
    direct impact on the steel industry unless you would put up a
    new plant or expand an existing plan. Is that correct?
        Mr. Harnack. Based on the present language on the
    greenhouse gas requirements but there are other requirements
    coming out from EPA that are going to require substantial
    modifications.
        Mr. Doyle. Right, but we are focused today and this bill
    focuses on the GHG emissions, not other things. That is what
    this focus is.
        Mr. Harnack. Right.
        Mr. Doyle. OK. Thank you very much, Mr. Chairman. I see I
    have 8 seconds, and I will yield it back.
        Thanks, Fred.
        Mr. Whitfield. Thank you. Mr. Gardner, you are recognized
    for 5 minutes.
        Mr. Gardner. Thank you, Mr. Chairman, and again, thank you
    to the witnesses for being here today.
        And Mr. Nelson, I would like to direct this question to
    you. In my conversation with Administrator Jackson on
    agriculture and agriculture's exemption so what she phrased it
    as from this going until 2013, what happens after 2013?
        Mr. Nelson. Well, that is the good question that probably
    needs to be asked because the rules have not been put into
    place so there is a lot of speculation as to where we will be
    as it gets to that time frame.
        Mr. Gardner. And so as of 2013 and beyond, this very well
    may be a situation where EPA comes in and starts requiring more
    permits in agriculture.
        Mr. Nelson. We believe that that probably will be the case,
    I can tell you, and we are not talking about the Clean Water
    Act today but just as a for instance, the amount of regulations
    that are coming out with nutrient management plans, MPDES
    permits, numeric standards, there is a whole tidal wave of
    regulatory challenges staring us in the face, so I think we
    would expect more of that.
        Mr. Gardner. And particularly too the greenhouse gas
    emissions regulation, and it goes a little bit to the question
    directed to Mr. Harnack as well. Costs of direct regulations,
    the indirect costs versus direct costs. When we say that
    agriculture--when Administrator Jackson says that agriculture
    is exempt, your energy costs will increase as a result of GHG,
    correct?
        Mr. Nelson. Yes.
        Mr. Gardner. The cost of fertilizer will increase as a
    result of regulation, correct?
        Mr. Nelson. Yes.
        Mr. Gardner. The cost of farm equipment will increase as a
    result of the regulation?
        Mr. Nelson. Yes.
        Mr. Gardner. Mr. Harnack, will you see costs increase as a
    result of the GHG regulation?
        Mr. Harnack. Yes, we will.
        Mr. Gardner. And so there are costs that you are facing
    whether direct or indirect which goes directly to your ability
    to create new jobs in the steel industry or to expand farms to
    future generations. Is that correct?
        Mr. Nelson. That is right.
        Mr. Gardner. And to Dr. Thorning, I don't know how familiar
    you are with the economy of California, but based on your
    experience as an economist, what you have seen in the State of
    California, the fact that 650 CEOs have said that it is the
    least desirable place to do Business, some of the regulations
    that we have seen, is California the kind of business model job
    creation market that we would like to export to the rest of the
    country?
        Ms. Thorning. I think one would have to look very carefully
    at what the impact of AB32 may have had on companies' desires
    to stay and manufacture in California. I think you have to look
    at the size of their budget deficit, their very high
    unemployment rate, their, you know, low relatively difficulty
    in the housing market. I don't think California is a poster
    child for how we want to go forward.
        Mr. Gardner. Mr. Goldstene, do you think California is a
    jobs creation model for the rest of the United States?
        Mr. Goldstene. I think there are many aspects of what is
    going on in California that should be copied by other States.
    We are the technology leader in the country. We are seeing a
    huge spike in investment since the passage of AB-32. People are
    coming here looking to have us move forward on our rules,
    provide the certainty that businesses want and also provide the
    certainty that creative, inventive Americans have proven over
    and over again to come up with the great ideas that are adopted
    here and other places.
        Mr. Gardner. Dr. Thorning, will the investments that are
    required to comply with these kind of regulations, greenhouse
    gas regulations, to produce these kinds of jobs, will they
    produce enough jobs in the green industry to offset the jobs
    lost elsewhere?
        Ms. Thorning. Well, I think it is highly unlikely because
    you are making investments that don't really add anything to
    the bottom line. They are being made, you know, to reduce
    greenhouse gases. So that is money that can't go into
    productivity enhancement investments.
        Mr. Gardner. So the bottom line is, does this regulation
    that we have been dealing with, what this bill deals with, does
    it affect our ability to be competitive globally?
        Ms. Thorning. I think it does in a negative fashion.
        Mr. Whitfield. Mr. Griffith, you are recognized for 5
    minutes.
        Mr. Griffith. Mr. Chairman, I just want to thank all the
    folks here for going through the day with us. I was not up here
    the whole time. At 4 o'clock I finally decided that I had to
    break down and eat something, so I went out in the other room
    and I was listening to your testimony, and I appreciate you all
    being here. I think all the questions have been asked, Mr.
    Chairman, so I yield my time back to the Chair.
        Mr. Whitfield. Thank you, Mr. Griffith. I want to thank all
    of you once again for your valuable testimony and your time,
    and we all have a lot of challenges before us. We don't agree
    on everything but that is what America is all about, so
    hopefully from hearings like this we can craft the best
    policies to move forward. So thank you very much.
        Mr. Rush. Mr. Chairman, before we adjourn, first of all, I
    want to thank all the witnesses on this panel and all the
    witnesses that preceded this panel, and I certainly want to let
    them know that they have really enlightened us. I haven't
    agreed on most of the testimony but at least I feel as though I
    am better informed, so I really appreciate the investment of
    your time. Thank you so very much.
        And before we adjourn, I do have an unanimous consent
    request but I guess you can dismiss the panel first. They don't
    want to hear a unanimous consent request.
        Mr. Whitfield. Well, without objection, we will----
        Mr. Rush. I have----
        Mr. Whitfield. I hate for them to leave before we leave.
        Mr. Rush. Well, I just have an unanimous consent request
    that statements and letters from the following organizations be
    placed in the record: the American Sustainable Business
    Council, the Calpine Corporation, the National Council of
    Churches, 68 faith communities throughout this Nation, the
    Natural Resources Defense Council, the Northeast States for
    Coordinated Air Use Management, the Truman National Security
    Project, the Union of Concerned Scientists, who also sent a
    letter that was also signed by 2,505 scientists and economists,
    and lastly, yesterday's letter from Mr. Waxman to Mr. Upton.
        Mr. Whitfield. And then we would like to enter this record
    from the National Association of Realtors, so without any
    objection, so ordered.
        [The information appears at the conclusion of the hearing.]
        Mr. Whitfield. The members will have 10 days to submit any
    questions for the record, and the record will be open for 30
    days. Thank you.
        [Whereupon, at 5:26 p.m., the subcommittee was adjourned.]
        [Material submitted for inclusion in the record follows:]

                    Prepared Statement of Hon. John Sullivan

        Chairman Whitfield: thank you for holding this legislative
    hearing today on the Energy Tax Prevention Act of 2011. This
    important legislation will help protect American jobs and
    businesses of all kinds from the regulatory onslaught of EPA's
    job destroying greenhouse gas regulations (GHGs) by prohibiting
    EPA from regulating GHG's under the Clean Air Act (CAA) and
    repeal the steps the agency has already taken to do so.
        I have several companies in my district ranging from
    chemical, manufacturing and energy companies that are scared to
    death of EPA's pending rules on GHGs. The energy industry
    employs over 320,000 workers in my state, and I intend to see
    that number grow by vigorously supporting this legislation.
        Today, I want to make special mention of the concerns of
    the agriculture interests in Oklahoma, since it is the second
    largest industry in my state. The Oklahoma Farm Bureau is
    deeply concerned that the costs imposed by EPA's GHG rules on
    utilities, refiners and manufactures to comply with these new
    regulations will trickle down the farming and ranching
    community, resulting in higher costs of production and food
    costs for American families, exactly what we don't need in a
    struggling economy!
        Additionally, many farmers and ranchers will have to obtain
    Title V operating permits that will cost agriculture interests
    close to $900 million. All told, 17,000 farms nationwide are
    impacted by EPA's GHG regulations. The point here is that even
    with EPA's so-called ``tailoring rule,'' which unilaterally
    raised CAA statutory thresholds to require GHG permitting for
    only the largest industrial sources of GHG emissions,
    industries of all stripes and consumers from every economic
    back grounds will suffer under the weight of EPA's excessive
    regulatory scheme.
        The Energy Tax Prevention Act is about protecting American
    jobs by preventing the EPA from unilaterally imposing a costly
    cap and trade style regulatory tax on the American people.
    Simply put, what the EPA and the Obama Administration has been
    unable to legislate through a cap and trade system, they are
    seeking to do it through backdoor regulation. This has to stop
    and I believe this legislation is the right approach. It is
    narrowly written to focus only on greenhouse gases related to
    climate change, and EPA's authority to monitor and regulate
    pollutants remains intact.
        Mr. Chairman, the Energy Tax Prevention Act of 2011 is
    important legislation to protect jobs, keep our nation
    competitive in foreign markets and provide economic certainty
    to the millions of American workers employed by industries that
    will be impacted by this backdoor national energy tax. This
    hearing marks our opening salvo to show the American people we
    mean business when it comes to growing our economy and
    identifying and removing job destroying regulations.
        I look forward to the testimony of our witnesses and I
    yield back the balance of my time.
                                  ----------

                  Prepared Statement of Hon. David B. McKinley

        Good morning. Chairman Whitefield and Ranking Member Rush,
    thank you for holding this hearing today to discuss the draft
    discussion of the Energy Tax Prevention Act of 2011.
        I look forward to hearing from our witnesses today,
    particularly the testimony and discussion of Environmental
    Protection Agency Administrator Lisa Jackson. Representing West
    Virginia's First Congressional District, it is my duty to
    ensure the citizens of West Virginia are protected not only for
    their health and safety, but to ensure that the current
    Administration's Agencies do not eradicate the industries they
    work in, and that they will be able to put food on the table
    for their families.
        With that being said, many of the EPA's regulations,
    whether in effect or proposed, will be detrimental to not only
    the State of West Virginia but to our entire Nation. We
    continue to see an EPA which circumvents the Congressional
    process by allowing bureaucrats to make decisions that should
    be left up to federal and state lawmakers.
        On January 13th of this year, the EPA took an unprecedented
    step to retroactively revoke a lawfully issued, four-year old,
    Section 404 permit for the Spruce No. 1 surface mine in Logan
    County, West Virginia. The implications of this action prompted
    me to file legislation to combat this blatant overreach by a
    federal agency, which is detrimental to the local businesses
    and hundreds of workers.
        This was not a regulation issued by the EPA, but rather was
    a permit issued under the Clean Water Act and approved by the
    Army Corps of Engineers in January 2007. For nearly a decade
    prior to 2007, the Army Corps of Engineers worked with the EPA
    to rigorously review the Spruce Mine project before it was
    approved. The permit was issued after an extensive 10-year
    environmental review, including a 1600 page Environmental
    Impact Statement (EIS) in which the EPA full participated and
    agreed to all terms and conditions included in the authorized
    permit. The EPA had every opportunity to address any concerns
    prior to when the permit was issued. Because of the EPA's
    chilling actions in revoking the permit, they prohibited the
    creation of 253 mining jobs and 298 indirect jobs, in addition
    to an investment of $250 million into the local community.
        I firmly believe that our states need a consistent and
    predictable regulatory program that will protect the jobs we
    have and create the jobs we need in an environmentally
    responsible manner. It is impossible for companies to take the
    necessary steps to move forward and create jobs if they have to
    live with the threat of unilateral retroactive revocation of
    the very permits that allow them to do business. The EPA cannot
    continue to punish the coal, manufacturing and natural gas
    industries. These are the industries vital to the survival of
    West Virginia and families will continue to suffer and be
    impoverished under this Administration.
        Any decisions from any agency or government entity should
    stem from the congressional review process, extensive studies,
    public input, review by other federal agencies, and peer review
    by experts.
        I look forward to hearing from the today's witnesses, and
    look forward to working with Subcommittee Chairman Whitfield
    and Chairman Upton in the full committee to ensure that lives,
    jobs, industries, families and our economy are protected.
        Thank you and I yield back.
                                  ----------

                    Prepared Statement of Hon. Cory Gardner

        Just the other day, my staff asked a fairly large electric
    corporation in my district how exactly these greenhouse gas
    regulations would affect Colorado. Their response was something
    to the effect of, ``With all the regulations coming down on our
    heads from EPA, we stopped doing a full-blown analysis of what
    each regulation would do to our customers.'' It is simply
    impossible to gauge exactly the job losses, exactly the rate
    increases, and exactly the effect on service to cities in my
    district. However, they know with all these regulations put
    together, it will be large.
        They, along with so many other businesses all over the
    country, cannot keep track of all the regulations they are
    going to have to abide by - but they are bracing themselves
    nonetheless, especially with regard to GHG regulation. They are
    anticipating having to absorb higher costs which will lead to
    job losses and less innovation among many other things. What's
    worse, these rules have the potential to affect even more
    businesses in the future if we don't stop it now.
        The Energy Tax Prevention Act does a couple key things. It
    prevents the EPA from regulating GHGs under the Clean Air Act
    (CAA), which it does not have the authority to do anyway. It
    also repeals steps that EPA has taken over the last two years
    to achieve the goal of GHG regulation. The bill does not,
    however, prevent the EPA from continuing its other obligations
    to protect the environment.
        The CAA was never meant to be a means to regulate GHGs. In
    fact, EPA was forced to change the CAA in order to make it work
    for the GHG regulations. The CAA as it existed before the
    infamous ``tailoring rule'' allowed for regulation of various
    ``conventional pollutants.'' This includes things like lead and
    nitrogen dioxide. However, the threshold laid out in the CAA
    was far too low for greenhouse gases. If the CAA was
    interpreted to regulate GHGs under its original thresholds,
    virtually no businesses that emitted any sort of GHG would be
    able to avoid serious federal regulation. This change has
    proven that the CAA was never meant for regulating GHGs.
        Despite these facts, here we are. The EPA has done no
    thorough analysis of how this will affect industry, jobs, and
    energy prices but that has not stopped them from moving right
    along with their agenda. And they are continuing this
    regulatory scheme despite failed attempts to pass a similar cap
    and tax bill in both houses of Congress. This is nothing but a
    runaround attempt at a national energy tax - forcing consumers
    to pick up the bill for an agenda that hurts jobs and
    businesses, and not allowing for a thorough vetting process.
    Further, states simply are not prepared for the new permitting
    requirements laid out in the regulation, which are likely to
    delay new energy projects from being built.
        Mr. Chairman, this is just the beginning of what EPA will
    do if we continue to let them. If we do not change our course
    now, businesses will do what they do best - they'll find
    another market, and it's likely that market will have little or
    no regulation on GHGs. This will cost us jobs and lead us down
    a path that does not end at energy independence. I support this
    bill as a solution to the future job losses and energy price
    increases that our nation will experience if we allow these
    regulations to move forward. I yield back my time.
                                  ----------

                          Statement of Hon. Lois Capps

        Mr. Chairman, I'm troubled we're here this morning.
    Americans still are facing staggering unemployment rates, and
    our economy has not yet fully recovered.
        But instead of holding hearings on ways to generate more
    clean energy jobs and improve the health of American families,
    we're reviewing an extreme proposal that would block EPA from
    doing its job: protecting our health from air pollution.
        Mr. Chairman, not allowing the EPA to address carbon
    pollution under the Clean Air Act is flat-out dangerous.
        Climate change is a serious problem. The scientific
    evidence is clear. The debate is over. Climate change is real.
    It's happening. And, human beings are largely to blame.
        2010 was the hottest year on record. And in the last decade
    the Earth experienced 9 of the 10 hottest years since data has
    been recorded.
        We're also starting to see the irreversible damage to our
    economy and our environment.
        Sea levels are rising. The world is witnessing increased
    rainfall, floods, droughts, and wildfires. And, our fresh water
    supplies and capacity to grow enough food will be severely
    challenged in the years ahead.
        Mr. Chairman, the longer we delay taking action to address
    climate change, the more difficult and expensive the solutions
    will be.
        That's why the EPA is taking a cautious, flexible and
    balanced approach to addressing carbon pollution. And each of
    the steps they've taken so far has followed the letter of the
    law.
        For four decades, the Clean Air Act has protected the
    health of millions of Americans - including our children, our
    seniors and the most vulnerable among us - from all kinds of
    dangerous air pollutants.
        The law also has a tremendous track record in providing
    certainty to business and delivering economic benefits.
        For example, since the Clean Air Act was enacted overall
    air pollution has dropped while U.S. GDP has risen 207 percent.
    And we've also seen major health benefits, including asthma
    reduction, lower lung cancer rates, and much greater
    productivity.
        In fact, by 2020 the benefits of the Clean Air Act are
    expected to reach $2 trillion, exceeding any costs by more than
    30 to 1.
        All of these benefits, Mr. Chairman, are jeopardized by
    this proposed rollback to the Clean Air Act.
        And that's why groups ranging from the American Lung
    Association to the American Sustainable Business Council have
    decried the harm of this proposal to people's health and
    economy. And it's why I stand with them today in opposing this
    extreme proposal.
        Here's what this proposed bill would do.
        First, it would declare that carbon pollution is not an air
    pollutant and repeal the EPA's science based endangerment
    finding, throwing the findings of the National Academy of
    Sciences, federal government agencies and countless other
    scientific experts out the window.
        Second, it would also repeal every action the EPA has
    already taken and block every action EPA is developing to limit
    carbon pollution from power plants and oil refineries, giving
    the nation's biggest polluters a free pass for unlimited carbon
    pollution.
        Third, it would tear up the historic agreement reached by
    the Obama administration, the nation's automakers and states to
    cut carbon pollution and fuel consumption in new cars and
    trucks. This means more air pollution and higher fuel bills for
    all Americans in the future.
        Mr. Chairman, this is an unprecedented, extreme proposal
    and it should not go forward.
        Last month, President Obama stood on the House floor and
    talked about ``winning the future'' through innovation. And he
    used clean energy as his central example.
        We know that clean energy will help our economy grow. It
    will help America compete in the global marketplace. And it
    will help protect Americans' health and quality of life.
        Let's not obstruct the EPA from doing its job of protecting
    the public's health and environment.
        This is a crucial issue, Mr. Chairman, for the public and
    our planet.
        It's our duty here to ensure both are protected from
    harmful carbon pollution. And unfortunately, this extreme
    proposal just doesn't meet this crucial test.
                                  ----------

    [GRAPHIC] [TIFF OMITTED] T5734.001

    [GRAPHIC] [TIFF OMITTED] T5734.002

    [GRAPHIC] [TIFF OMITTED] T5734.003

    [GRAPHIC] [TIFF OMITTED] T5734.004

    [GRAPHIC] [TIFF OMITTED] T5734.005

    [GRAPHIC] [TIFF OMITTED] T5734.006

    [GRAPHIC] [TIFF OMITTED] T5734.007

    [GRAPHIC] [TIFF OMITTED] T5734.008

    [GRAPHIC] [TIFF OMITTED] T5734.009

    [GRAPHIC] [TIFF OMITTED] T5734.010

    [GRAPHIC] [TIFF OMITTED] T5734.011

    [GRAPHIC] [TIFF OMITTED] T5734.012

    [GRAPHIC] [TIFF OMITTED] T5734.013

    [GRAPHIC] [TIFF OMITTED] T5734.014

    [GRAPHIC] [TIFF OMITTED] T5734.015

    [GRAPHIC] [TIFF OMITTED] T5734.016

    [GRAPHIC] [TIFF OMITTED] T5734.017

    [GRAPHIC] [TIFF OMITTED] T5734.018

    [GRAPHIC] [TIFF OMITTED] T5734.019

    [GRAPHIC] [TIFF OMITTED] T5734.020

    [GRAPHIC] [TIFF OMITTED] T5734.021

    [GRAPHIC] [TIFF OMITTED] T5734.022

    [GRAPHIC] [TIFF OMITTED] T5734.023

    [GRAPHIC] [TIFF OMITTED] T5734.024

    [GRAPHIC] [TIFF OMITTED] T5734.025

    [GRAPHIC] [TIFF OMITTED] T5734.026

    [GRAPHIC] [TIFF OMITTED] T5734.027

    [GRAPHIC] [TIFF OMITTED] T5734.028

    [GRAPHIC] [TIFF OMITTED] T5734.029

    [GRAPHIC] [TIFF OMITTED] T5734.030

    [GRAPHIC] [TIFF OMITTED] T5734.031

    [GRAPHIC] [TIFF OMITTED] T5734.032

    [GRAPHIC] [TIFF OMITTED] T5734.033

    [GRAPHIC] [TIFF OMITTED] T5734.034

    [GRAPHIC] [TIFF OMITTED] T5734.035

    [GRAPHIC] [TIFF OMITTED] T5734.036

    [GRAPHIC] [TIFF OMITTED] T5734.037

    [GRAPHIC] [TIFF OMITTED] T5734.038

    [GRAPHIC] [TIFF OMITTED] T5734.039

    [GRAPHIC] [TIFF OMITTED] T5734.040

    [GRAPHIC] [TIFF OMITTED] T5734.041

    [GRAPHIC] [TIFF OMITTED] T5734.042

    [GRAPHIC] [TIFF OMITTED] T5734.043

    [GRAPHIC] [TIFF OMITTED] T5734.044

    [GRAPHIC] [TIFF OMITTED] T5734.045

    [GRAPHIC] [TIFF OMITTED] T5734.046

    [GRAPHIC] [TIFF OMITTED] T5734.047

    [GRAPHIC] [TIFF OMITTED] T5734.048

    [GRAPHIC] [TIFF OMITTED] T5734.049

    [GRAPHIC] [TIFF OMITTED] T5734.050

    [GRAPHIC] [TIFF OMITTED] T5734.051

    [GRAPHIC] [TIFF OMITTED] T5734.052

    [GRAPHIC] [TIFF OMITTED] T5734.053

    [GRAPHIC] [TIFF OMITTED] T5734.054

    [GRAPHIC] [TIFF OMITTED] T5734.055

    [GRAPHIC] [TIFF OMITTED] T5734.056

    [GRAPHIC] [TIFF OMITTED] T5734.057

    [GRAPHIC] [TIFF OMITTED] T5734.058

    [GRAPHIC] [TIFF OMITTED] T5734.059

    [GRAPHIC] [TIFF OMITTED] T5734.060

    [GRAPHIC] [TIFF OMITTED] T5734.061

    [GRAPHIC] [TIFF OMITTED] T5734.062

    [GRAPHIC] [TIFF OMITTED] T5734.063

    [GRAPHIC] [TIFF OMITTED] T5734.064

    [GRAPHIC] [TIFF OMITTED] T5734.065

    [GRAPHIC] [TIFF OMITTED] T5734.066

    [GRAPHIC] [TIFF OMITTED] T5734.067

    [GRAPHIC] [TIFF OMITTED] T5734.068

    [GRAPHIC] [TIFF OMITTED] T5734.069

    [GRAPHIC] [TIFF OMITTED] T5734.070

    [GRAPHIC] [TIFF OMITTED] T5734.071

    [GRAPHIC] [TIFF OMITTED] T5734.072

    [GRAPHIC] [TIFF OMITTED] T5734.073

    [GRAPHIC] [TIFF OMITTED] T5734.074

    [GRAPHIC] [TIFF OMITTED] T5734.075

    [GRAPHIC] [TIFF OMITTED] T5734.076

    [GRAPHIC] [TIFF OMITTED] T5734.077

    [GRAPHIC] [TIFF OMITTED] T5734.078

    [GRAPHIC] [TIFF OMITTED] T5734.079

    [GRAPHIC] [TIFF OMITTED] T5734.080

    [GRAPHIC] [TIFF OMITTED] T5734.081

    [GRAPHIC] [TIFF OMITTED] T5734.082

    [GRAPHIC] [TIFF OMITTED] T5734.083

    [GRAPHIC] [TIFF OMITTED] T5734.084

    [GRAPHIC] [TIFF OMITTED] T5734.085

    [GRAPHIC] [TIFF OMITTED] T5734.086

    [GRAPHIC] [TIFF OMITTED] T5734.087

    [GRAPHIC] [TIFF OMITTED] T5734.088

    [GRAPHIC] [TIFF OMITTED] T5734.089

    [GRAPHIC] [TIFF OMITTED] T5734.090

    [GRAPHIC] [TIFF OMITTED] T5734.091

    [GRAPHIC] [TIFF OMITTED] T5734.092

    [GRAPHIC] [TIFF OMITTED] T5734.093

    [GRAPHIC] [TIFF OMITTED] T5734.094

    [GRAPHIC] [TIFF OMITTED] T5734.095

    [GRAPHIC] [TIFF OMITTED] T5734.099

    [GRAPHIC] [TIFF OMITTED] T5734.100

    [GRAPHIC] [TIFF OMITTED] T5734.101

    [GRAPHIC] [TIFF OMITTED] T5734.102

    [GRAPHIC] [TIFF OMITTED] T5734.103

    [GRAPHIC] [TIFF OMITTED] T5734.104

    [GRAPHIC] [TIFF OMITTED] T5734.105

    [GRAPHIC] [TIFF OMITTED] T5734.106

    [GRAPHIC] [TIFF OMITTED] T5734.107

    [GRAPHIC] [TIFF OMITTED] T5734.108

    [GRAPHIC] [TIFF OMITTED] T5734.109

    [GRAPHIC] [TIFF OMITTED] T5734.110

    [GRAPHIC] [TIFF OMITTED] T5734.111

    [GRAPHIC] [TIFF OMITTED] T5734.112

    [GRAPHIC] [TIFF OMITTED] T5734.113

    [GRAPHIC] [TIFF OMITTED] T5734.114

    [GRAPHIC] [TIFF OMITTED] T5734.115

    [GRAPHIC] [TIFF OMITTED] T5734.116

    [GRAPHIC] [TIFF OMITTED] T5734.117

    [GRAPHIC] [TIFF OMITTED] T5734.118

    [GRAPHIC] [TIFF OMITTED] T5734.119

    [GRAPHIC] [TIFF OMITTED] T5734.120

    [GRAPHIC] [TIFF OMITTED] T5734.121

    [GRAPHIC] [TIFF OMITTED] T5734.122

    [GRAPHIC] [TIFF OMITTED] T5734.123

    [GRAPHIC] [TIFF OMITTED] T5734.124

    [GRAPHIC] [TIFF OMITTED] T5734.125

    [GRAPHIC] [TIFF OMITTED] T5734.126

    [GRAPHIC] [TIFF OMITTED] T5734.127

    [GRAPHIC] [TIFF OMITTED] T5734.128

    [GRAPHIC] [TIFF OMITTED] T5734.129

    [GRAPHIC] [TIFF OMITTED] T5734.130

    [GRAPHIC] [TIFF OMITTED] T5734.131

    [GRAPHIC] [TIFF OMITTED] T5734.132

    [GRAPHIC] [TIFF OMITTED] T5734.133

    [GRAPHIC] [TIFF OMITTED] T5734.204

    [GRAPHIC] [TIFF OMITTED] T5734.205

    [GRAPHIC] [TIFF OMITTED] T5734.206

    [GRAPHIC] [TIFF OMITTED] T5734.207

    [GRAPHIC] [TIFF OMITTED] T5734.208

    [GRAPHIC] [TIFF OMITTED] T5734.209

    [GRAPHIC] [TIFF OMITTED] T5734.210

    [GRAPHIC] [TIFF OMITTED] T5734.211

    [GRAPHIC] [TIFF OMITTED] T5734.212

    [GRAPHIC] [TIFF OMITTED] T5734.213

    [GRAPHIC] [TIFF OMITTED] T5734.214

    [GRAPHIC] [TIFF OMITTED] T5734.215

    [GRAPHIC] [TIFF OMITTED] T5734.216

    [GRAPHIC] [TIFF OMITTED] T5734.217

    [GRAPHIC] [TIFF OMITTED] T5734.218

    [GRAPHIC] [TIFF OMITTED] T5734.219

    [GRAPHIC] [TIFF OMITTED] T5734.220

    [GRAPHIC] [TIFF OMITTED] T5734.221

    [GRAPHIC] [TIFF OMITTED] T5734.222

    [GRAPHIC] [TIFF OMITTED] T5734.223

    [GRAPHIC] [TIFF OMITTED] T5734.224

    [GRAPHIC] [TIFF OMITTED] T5734.225

    [GRAPHIC] [TIFF OMITTED] T5734.226

    [GRAPHIC] [TIFF OMITTED] T5734.227

    [GRAPHIC] [TIFF OMITTED] T5734.228

    [GRAPHIC] [TIFF OMITTED] T5734.229

    [GRAPHIC] [TIFF OMITTED] T5734.230

    [GRAPHIC] [TIFF OMITTED] T5734.231

    [GRAPHIC] [TIFF OMITTED] T5734.232

    [GRAPHIC] [TIFF OMITTED] T5734.233

    [GRAPHIC] [TIFF OMITTED] T5734.234

    [GRAPHIC] [TIFF OMITTED] T5734.235

    [GRAPHIC] [TIFF OMITTED] T5734.236

    [GRAPHIC] [TIFF OMITTED] T5734.237

    [GRAPHIC] [TIFF OMITTED] T5734.238

    [GRAPHIC] [TIFF OMITTED] T5734.239

    [GRAPHIC] [TIFF OMITTED] T5734.240

    [GRAPHIC] [TIFF OMITTED] T5734.241

    [GRAPHIC] [TIFF OMITTED] T5734.242

    [GRAPHIC] [TIFF OMITTED] T5734.243

    [GRAPHIC] [TIFF OMITTED] T5734.244

    [GRAPHIC] [TIFF OMITTED] T5734.245

    [GRAPHIC] [TIFF OMITTED] T5734.246

    [GRAPHIC] [TIFF OMITTED] T5734.247

    [GRAPHIC] [TIFF OMITTED] T5734.248

    [GRAPHIC] [TIFF OMITTED] T5734.249

    [GRAPHIC] [TIFF OMITTED] T5734.250

    [GRAPHIC] [TIFF OMITTED] T5734.251

    [GRAPHIC] [TIFF OMITTED] T5734.252

    [GRAPHIC] [TIFF OMITTED] T5734.253

    [GRAPHIC] [TIFF OMITTED] T5734.254

    [GRAPHIC] [TIFF OMITTED] T5734.255

    [GRAPHIC] [TIFF OMITTED] T5734.256

    [GRAPHIC] [TIFF OMITTED] T5734.257

    [GRAPHIC] [TIFF OMITTED] T5734.258

    [GRAPHIC] [TIFF OMITTED] T5734.259

    [GRAPHIC] [TIFF OMITTED] T5734.260

    [GRAPHIC] [TIFF OMITTED] T5734.261

    [GRAPHIC] [TIFF OMITTED] T5734.262

    [GRAPHIC] [TIFF OMITTED] T5734.263

    [GRAPHIC] [TIFF OMITTED] T5734.264

    [GRAPHIC] [TIFF OMITTED] T5734.265

    [GRAPHIC] [TIFF OMITTED] T5734.361

    [GRAPHIC] [TIFF OMITTED] T5734.362

    [GRAPHIC] [TIFF OMITTED] T5734.363

    [GRAPHIC] [TIFF OMITTED] T5734.364

    [GRAPHIC] [TIFF OMITTED] T5734.365

    [GRAPHIC] [TIFF OMITTED] T5734.366

    [GRAPHIC] [TIFF OMITTED] T5734.367

    [GRAPHIC] [TIFF OMITTED] T5734.368

    [GRAPHIC] [TIFF OMITTED] T5734.369

    [GRAPHIC] [TIFF OMITTED] T5734.370

    [GRAPHIC] [TIFF OMITTED] T5734.371

    [GRAPHIC] [TIFF OMITTED] T5734.372

    [GRAPHIC] [TIFF OMITTED] T5734.373

    [GRAPHIC] [TIFF OMITTED] T5734.374

    [GRAPHIC] [TIFF OMITTED] T5734.375

    [GRAPHIC] [TIFF OMITTED] T5734.376

    [GRAPHIC] [TIFF OMITTED] T5734.377

    [GRAPHIC] [TIFF OMITTED] T5734.378

    [GRAPHIC] [TIFF OMITTED] T5734.379

    [GRAPHIC] [TIFF OMITTED] T5734.380

    [GRAPHIC] [TIFF OMITTED] T5734.381

    [GRAPHIC] [TIFF OMITTED] T5734.382

    [GRAPHIC] [TIFF OMITTED] T5734.383

    [GRAPHIC] [TIFF OMITTED] T5734.384

    [GRAPHIC] [TIFF OMITTED] T5734.385

    [GRAPHIC] [TIFF OMITTED] T5734.386

    [GRAPHIC] [TIFF OMITTED] T5734.387

    [GRAPHIC] [TIFF OMITTED] T5734.388

    [GRAPHIC] [TIFF OMITTED] T5734.389

    [GRAPHIC] [TIFF OMITTED] T5734.390

    [GRAPHIC] [TIFF OMITTED] T5734.391

    [GRAPHIC] [TIFF OMITTED] T5734.392

    [GRAPHIC] [TIFF OMITTED] T5734.393

    [GRAPHIC] [TIFF OMITTED] T5734.394

    [GRAPHIC] [TIFF OMITTED] T5734.395

    [GRAPHIC] [TIFF OMITTED] T5734.396

    [GRAPHIC] [TIFF OMITTED] T5734.397

    [GRAPHIC] [TIFF OMITTED] T5734.398

    [GRAPHIC] [TIFF OMITTED] T5734.399

    [GRAPHIC] [TIFF OMITTED] T5734.400

    [GRAPHIC] [TIFF OMITTED] T5734.401

    [GRAPHIC] [TIFF OMITTED] T5734.402

    [GRAPHIC] [TIFF OMITTED] T5734.403

    [GRAPHIC] [TIFF OMITTED] T5734.404

    [GRAPHIC] [TIFF OMITTED] T5734.405

    [GRAPHIC] [TIFF OMITTED] T5734.406

    [GRAPHIC] [TIFF OMITTED] T5734.407

    [GRAPHIC] [TIFF OMITTED] T5734.408

    [GRAPHIC] [TIFF OMITTED] T5734.409

    [GRAPHIC] [TIFF OMITTED] T5734.410

    [GRAPHIC] [TIFF OMITTED] T5734.411

    [GRAPHIC] [TIFF OMITTED] T5734.412

    [GRAPHIC] [TIFF OMITTED] T5734.413

    [GRAPHIC] [TIFF OMITTED] T5734.414

    [GRAPHIC] [TIFF OMITTED] T5734.415

    [GRAPHIC] [TIFF OMITTED] T5734.416

    [GRAPHIC] [TIFF OMITTED] T5734.417

    [GRAPHIC] [TIFF OMITTED] T5734.418

    [GRAPHIC] [TIFF OMITTED] T5734.419

    [GRAPHIC] [TIFF OMITTED] T5734.420

    [GRAPHIC] [TIFF OMITTED] T5734.421

    [GRAPHIC] [TIFF OMITTED] T5734.422

    [GRAPHIC] [TIFF OMITTED] T5734.423

    [GRAPHIC] [TIFF OMITTED] T5734.424

    [GRAPHIC] [TIFF OMITTED] T5734.425

    [GRAPHIC] [TIFF OMITTED] T5734.426

    [GRAPHIC] [TIFF OMITTED] T5734.427

    [GRAPHIC] [TIFF OMITTED] T5734.428

    [GRAPHIC] [TIFF OMITTED] T5734.429

    [GRAPHIC] [TIFF OMITTED] T5734.430

    [GRAPHIC] [TIFF OMITTED] T5734.431

    [GRAPHIC] [TIFF OMITTED] T5734.432

    [GRAPHIC] [TIFF OMITTED] T5734.433

    [GRAPHIC] [TIFF OMITTED] T5734.434

    [GRAPHIC] [TIFF OMITTED] T5734.435

    [GRAPHIC] [TIFF OMITTED] T5734.436

    [GRAPHIC] [TIFF OMITTED] T5734.437

    [GRAPHIC] [TIFF OMITTED] T5734.438

    [GRAPHIC] [TIFF OMITTED] T5734.439

    [GRAPHIC] [TIFF OMITTED] T5734.440

    [GRAPHIC] [TIFF OMITTED] T5734.441

    [GRAPHIC] [TIFF OMITTED] T5734.442

    [GRAPHIC] [TIFF OMITTED] T5734.443

    [GRAPHIC] [TIFF OMITTED] T5734.444

    [GRAPHIC] [TIFF OMITTED] T5734.445

    [GRAPHIC] [TIFF OMITTED] T5734.446

    [GRAPHIC] [TIFF OMITTED] T5734.447

    [GRAPHIC] [TIFF OMITTED] T5734.448

    [GRAPHIC] [TIFF OMITTED] T5734.449

    [GRAPHIC] [TIFF OMITTED] T5734.450

    [GRAPHIC] [TIFF OMITTED] T5734.451

    [GRAPHIC] [TIFF OMITTED] T5734.452

    [GRAPHIC] [TIFF OMITTED] T5734.453

    [GRAPHIC] [TIFF OMITTED] T5734.454

    [GRAPHIC] [TIFF OMITTED] T5734.455

    [GRAPHIC] [TIFF OMITTED] T5734.456

    [GRAPHIC] [TIFF OMITTED] T5734.457

    [GRAPHIC] [TIFF OMITTED] T5734.458

    [GRAPHIC] [TIFF OMITTED] T5734.459

    [GRAPHIC] [TIFF OMITTED] T5734.460

    [GRAPHIC] [TIFF OMITTED] T5734.461

    [GRAPHIC] [TIFF OMITTED] T5734.462

    [GRAPHIC] [TIFF OMITTED] T5734.463

    [GRAPHIC] [TIFF OMITTED] T5734.464

    [GRAPHIC] [TIFF OMITTED] T5734.465

    [GRAPHIC] [TIFF OMITTED] T5734.466

    [GRAPHIC] [TIFF OMITTED] T5734.467

    [GRAPHIC] [TIFF OMITTED] T5734.468

    [GRAPHIC] [TIFF OMITTED] T5734.469

    [GRAPHIC] [TIFF OMITTED] T5734.470

    [GRAPHIC] [TIFF OMITTED] T5734.471

    [GRAPHIC] [TIFF OMITTED] T5734.472

    [GRAPHIC] [TIFF OMITTED] T5734.473

    [GRAPHIC] [TIFF OMITTED] T5734.474

    [GRAPHIC] [TIFF OMITTED] T5734.475

    [GRAPHIC] [TIFF OMITTED] T5734.476

    [GRAPHIC] [TIFF OMITTED] T5734.477

    [GRAPHIC] [TIFF OMITTED] T5734.478

    [GRAPHIC] [TIFF OMITTED] T5734.479

    [GRAPHIC] [TIFF OMITTED] T5734.480

    [GRAPHIC] [TIFF OMITTED] T5734.481

    [GRAPHIC] [TIFF OMITTED] T5734.482

    [GRAPHIC] [TIFF OMITTED] T5734.483

    [GRAPHIC] [TIFF OMITTED] T5734.484

    [GRAPHIC] [TIFF OMITTED] T5734.485

    [GRAPHIC] [TIFF OMITTED] T5734.486

    [GRAPHIC] [TIFF OMITTED] T5734.487

    [GRAPHIC] [TIFF OMITTED] T5734.488

    [GRAPHIC] [TIFF OMITTED] T5734.489

    [GRAPHIC] [TIFF OMITTED] T5734.490

    [GRAPHIC] [TIFF OMITTED] T5734.491

    [GRAPHIC] [TIFF OMITTED] T5734.492

    [GRAPHIC] [TIFF OMITTED] T5734.493

    [GRAPHIC] [TIFF OMITTED] T5734.494

    [GRAPHIC] [TIFF OMITTED] T5734.495

    [GRAPHIC] [TIFF OMITTED] T5734.496

    [GRAPHIC] [TIFF OMITTED] T5734.497

    [GRAPHIC] [TIFF OMITTED] T5734.498

    [GRAPHIC] [TIFF OMITTED] T5734.499

    [GRAPHIC] [TIFF OMITTED] T5734.500

    [GRAPHIC] [TIFF OMITTED] T5734.501

    [GRAPHIC] [TIFF OMITTED] T5734.502

    [GRAPHIC] [TIFF OMITTED] T5734.503

    [GRAPHIC] [TIFF OMITTED] T5734.504

    [GRAPHIC] [TIFF OMITTED] T5734.505

    [GRAPHIC] [TIFF OMITTED] T5734.506

    [GRAPHIC] [TIFF OMITTED] T5734.507

    [GRAPHIC] [TIFF OMITTED] T5734.508

    [GRAPHIC] [TIFF OMITTED] T5734.509

    [GRAPHIC] [TIFF OMITTED] T5734.510

    [GRAPHIC] [TIFF OMITTED] T5734.511

    [GRAPHIC] [TIFF OMITTED] T5734.512

    [GRAPHIC] [TIFF OMITTED] T5734.513

    [GRAPHIC] [TIFF OMITTED] T5734.514

    [GRAPHIC] [TIFF OMITTED] T5734.515

    [GRAPHIC] [TIFF OMITTED] T5734.516

    [GRAPHIC] [TIFF OMITTED] T5734.517