    [House Hearing, 114 Congress]
    [From the U.S. Government Publishing Office]

     EPA'S PROPOSED 111(d) RULE FOR EXISTING POWER PLANTS: LEGAL AND COST
                                     ISSUES

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

                                    HEARING

                                   BEFORE THE

                        SUBCOMMITTEE ON ENERGY AND POWER

                                     OF THE

                        COMMITTEE ON ENERGY AND COMMERCE
                            HOUSE OF REPRESENTATIVES

                        ONE HUNDRED FOURTEENTH CONGRESS

                                 FIRST SESSION

                                   __________

                                 MARCH 17, 2015

                                   __________

                               Serial No. 114-20

    [GRAPHIC NOT AVAILABLE IN TIFF FORMAT]

          Printed for the use of the Committee on Energy and Commerce

                            energycommerce.house.gov

                                  ____________

                             U.S. GOVERNMENT PUBLISHING OFFICE
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                        COMMITTEE ON ENERGY AND COMMERCE

                              FRED UPTON, Michigan
                                     Chairman
    JOE BARTON, Texas                    FRANK PALLONE, Jr., New Jersey
      Chairman Emeritus                    Ranking Member
    ED WHITFIELD, Kentucky               BOBBY L. RUSH, Illinois
    JOHN SHIMKUS, Illinois               ANNA G. ESHOO, California
    JOSEPH R. PITTS, Pennsylvania        ELIOT L. ENGEL, New York
    GREG WALDEN, Oregon                  GENE GREEN, Texas
    TIM MURPHY, Pennsylvania             DIANA DeGETTE, Colorado
    MICHAEL C. BURGESS, Texas            LOIS CAPPS, California
    MARSHA BLACKBURN, Tennessee          MICHAEL F. DOYLE, Pennsylvania
      Vice Chairman                      JANICE D. SCHAKOWSKY, Illinois
    STEVE SCALISE, Louisiana             G.K. BUTTERFIELD, North Carolina
    ROBERT E. LATTA, Ohio                DORIS O. MATSUI, California
    CATHY McMORRIS RODGERS, Washington   KATHY CASTOR, Florida
    GREGG HARPER, Mississippi            JOHN P. SARBANES, Maryland
    LEONARD LANCE, New Jersey            JERRY McNERNEY, California
    BRETT GUTHRIE, Kentucky              PETER WELCH, Vermont
    PETE OLSON, Texas                    BEN RAY LUJAN, New Mexico
    DAVID B. McKINLEY, West Virginia     PAUL TONKO, New York
    MIKE POMPEO, Kansas                  JOHN A. YARMUTH, Kentucky
    ADAM KINZINGER, Illinois             YVETTE D. CLARKE, New York
    H. MORGAN GRIFFITH, Virginia         DAVID LOEBSACK, Iowa
    GUS M. BILIRAKIS, Florida            KURT SCHRADER, Oregon
    BILL JOHNSON, Ohio                   JOSEPH P. KENNEDY, III,
    BILLY LONG, Missouri                     Massachusetts
    RENEE L. ELLMERS, North Carolina     TONY CARDENAS, California
    LARRY BUCSHON, Indiana
    BILL FLORES, Texas
    SUSAN W. BROOKS, Indiana
    MARKWAYNE MULLIN, Oklahoma
    RICHARD HUDSON, North Carolina
    CHRIS COLLINS, New York
    KEVIN CRAMER, North Dakota

                        Subcommittee on Energy and Power

                             ED WHITFIELD, Kentucky
                                     Chairman
    PETE OLSON, Texas                    BOBBY L. RUSH, Illinois
      Vice Chairman                        Ranking Member
    JOHN SHIMKUS, Illinois               JERRY McNERNEY, California
    JOSEPH R. PITTS, Pennsylvania        PAUL TONKO, New York
    ROBERT E. LATTA, Ohio                ELIOT L. ENGEL, New York
    GREGG HARPER, Vice Chairman          GENE GREEN, Texas
    DAVID B. McKINLEY, West Virginia     LOIS CAPPS, California
    MIKE POMPEO, Kansas                  MICHAEL F. DOYLE, Pennsylvania
    ADAM KINZINGER, Illinois             KATHY CASTOR, Florida
    H. MORGAN GRIFFITH, Virginia         JOHN P. SARBANES, Maryland
    BILL JOHNSON, Ohio                   PETER WELCH, Vermont
    BILLY LONG, Missouri                 JOHN A. YARMUTH, Kentucky
    RENEE L. ELLMERS, North Carolina     DAVID LOEBSACK, Iowa
    BILL FLORES, Texas                   FRANK PALLONE, Jr., New Jersey (ex
    MARKWAYNE MULLIN, Oklahoma               officio)
    RICHARD HUDSON, North Carolina
    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. Jerry McNerney, a Representative in Congress from the State
      of California, opening statement...............................     3
    Hon. Fred Upton, a Representative in Congress from the State of
      Michigan, opening statement....................................     5
        Prepared statement...........................................     6
    Hon. Frank Pallone, Jr., a Representative in Congress from the
      State of New Jersey, opening statement.........................     6

                                   Witnesses

    Laurence H. Tribe, Carl M. Loeb University Professor and
      Professor Constitutional Law, Harvard Law School...............     8
        Prepared statement \1\.......................................     9
    Allison D. Wood, Partner, Hunton and Williams, LLP...............    10
        Prepared statement...........................................    12
        Answers to submitted questions...............................   195
    Richard L. Revesz, Lawrence King Professor of Law, Dean Emeritus,
      Director, Institute for Policy Integrity, New York University
      School of Law..................................................    34
        Prepared statement...........................................    36
    Craig Butler, Director, Ohio Environmental Protection Agency.....    84
        Prepared statement...........................................    87
    Kelly Speakes-Backman, Commissioner, Maryland Public Service
      Commission, and Chair, Board of Directors, Regional Greenhouse
      Gas Initiative, Inc............................................   101
        Prepared statement...........................................   103
    Art Graham, Chairman, Florida Public Service Commission..........   111
        Prepared statement...........................................   113
    Donald Van Der Vaart, Secretary, North Carolina Department of
      Environment and Natural Resources..............................   130
        Prepared statement...........................................   132

                               Submitted Material

    Comments on EPA Proposed Rule from the Florida Public Service
      Commission, December 1, 2014...................................   156
    Comments on EPA Proposed Rule from the Florida Office of Public
      Counsel, November 30, 2014.....................................   179

    ----------
    \1\ Available at: http://docs.house.gov/meetings/if/if03/
      20150317/103073/hhrg-114-if03-wstate-tribel-20150317-u1.pdf.

     EPA'S PROPOSED 111(d) RULE FOR EXISTING POWER PLANTS: LEGAL AND COST
                                     ISSUES

                                  ----------

                            TUESDAY, MARCH 17, 2015

                      House of Representatives,
                      Subcommittee on Energy and Power,
                              Committee on Energy and Commerce,
                                                        Washington, DC.
        The subcommittee met, pursuant to call, at 10:00 a.m., in
    room 2123 of the Rayburn House Office Building, Hon. Ed
    Whitfield (chairman of the subcommittee) presiding.
        Members present: Representatives Whitfield, Olson, Barton,
    Shimkus, Pitts, Latta, Harper, McKinley, Pompeo, Kinzinger,
    Griffith, Johnson, Long, Ellmers, Flores, Mullin, Upton (ex
    officio), McNerney, Tonko, Engel, Green, Capps, Castor,
    Sarbanes, Yarmuth, Loebsack, and Pallone (ex officio).
        Staff present: Nick Abraham, Legislative Clerk; Charlotte
    Baker, Deputy Communications Director; Leighton Brown, Press
    Assistance; Allison Busbee, Policy Coordinator, Energy and
    Power; Patrick Currier, Senior Counsel, Energy and Power; Tom
    Hassenboehler, Chief Counsel, Energy and Power; Mary Neumayr,
    Senior Energy Counsel; Chris Sarley, Policy Coordinator,
    Environment and Economy; Peter Spencer, Professional Staff
    Member, Oversight; Jean Woodrow, Director, Information
    Technology; Christine Brennan, Democratic Press Secretary; Jeff
    Carroll, Democratic Staff Director; Michael Goo, Democratic
    Senior Counsel, Energy and Environment; Caitlin Haberman,
    Democratic Professional Staff Member; Ashley Jones, Democratic
    Director, Outreach and Member Services; Rick Kessler,
    Democratic Senior Advisor and Staff Director, Energy and
    Environment; and John Marshall, Democratic Policy Coordinator.

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

        Mr. Whitfield. I would like to call our hearing to order
    this morning, and today's title is EPA's Proposed 111(d) Rule
    for Existing Power Plants: Legal and Cost Issues. And we have
    two panels of witnesses this morning, and I want to thank those
    of you on the first panel. I will be introducing each one of
    you before you give your opening statement, and you will be
    given 5 minutes at that time, but before we are able to listen
    to your marvelous opening statements, you have to listen to our
    opening statements, which sometimes is not quite as exciting to
    people.
        At this time, I would like to recognize myself for a 5-
    minute opening statement.
        As I said, this morning our subcommittee will hold its
    first hearing this year on the EPA's proposed Clean Power Plan.
    We will examine specifically the circuitous and tortured
    rationale, in my opinion, of EPA that Section 111(d) of the
    Clean Air Act grants them the authority to regulate
    CO2 emissions from electric generating units that
    are already regulated under Section 112. We are also going to
    look closely at the impact on states and consumers.
        It appears that EPA is--excuse me just 1 minute. Given the
    stringency of this EPA proposed rule regarding CO2
    emissions at existing in coal plants, states are going to be
    forced to adopt state implementation plans within 1 year. And
    this regulation is so onerous for coal generation that,
    according to EPA's own projections, the amount of coat for
    electric generation in America would decline by 40 percent from
    the 2009 levels. The well-respected economic consulting firm,
    NERA, concluded that the proposal is the most expensive
    environmental regulation ever imposed on the electric power
    sector, costing between $41 to $73 billion per year, with 14
    states facing peak year electricity price increases that are
    likely to exceed 20 percent. Regional grid reliability
    coordinators have begun warning that the rule will curse
    portions of the grid to suffer cascading outages and voltage
    collapse.
        The North American Electricity Reliability Corporation
    recently produced an initial analysis that questioned the
    validity of the basic assumptions underlying the rule, and
    raised a multitude of concerns as to how the rule will affect
    the grid. This proposed rule has been described as a power
    grab, extreme, radical, unprecedented, and a violation of
    existing law. I agree with those characterizations. Even EPA
    has acknowledged that a literal application of Section 111(d)
    would likely preclude its proposal because the electric
    generating units are already regulated under Section 112. This
    proposed regulation would create turmoil in the generation,
    transmission, and distribution of electricity. It is being
    proposed because the President was unable to convince Congress
    to adopt a cap and trade legislation, and he has made
    international commitments without input or advice and consent
    from Congress, and in his Georgetown speech, he committed the
    U.S. to an extreme policy. It appears that EPA is trying to
    find a way to implement the President's plan pursuant to his
    international commitments, even though EPA has readily
    acknowledged that this proposal would not make a measurable
    difference in addressing climate change.
        So this is a significant issue that is going to have a
    dramatic impact on everything relating to electricity
    generation in America, and it is our responsibility to make all
    of this transparent, to give the American people the
    opportunity to be aware of how extreme this is, and what a
    fundamental change it would make, and to address the question
    is it really legal. And that is what we intend to do today.
    That is why we are thrilled with the panel of witnesses that we
    have.
        [The prepared statement of Mr. Whitfield follows:]

                    Prepared statement of Hon. Ed Whitfield

        This morning our subcommittee will hold its first hearing
    of the year on the EPA's proposed ``Clean Power Plan.'' At this
    point, everyone from legal scholars to state government
    officials to affected utilities has had opportunity to review
    this proposed rule. As we will learn today, many have expressed
    serious concerns whether EPA can move forward with the proposed
    rule. Given the potential adverse impacts on ratepayers, many
    also question whether the agency should do so.
        EPA's plan to commandeer from state control nearly every
    major aspect of electricity generation, distribution, and use
    is based on section 111(d) of the Clean Air Act. However, there
    is a threshold question about whether EPA has statutory
    authority to proceed with its Clean Power Plan at all under
    that provision. Even assuming authority exists; neither the
    language of this provision nor its decades-long implementation
    history suggests that it authorizes such a sweeping federal
    agenda. This is especially true of the agency's attempts to
    regulate beyond the fence line of power plants by interfering
    with state decisions on matters like renewable portfolio
    standards and energy conservation mandates.
        Equally troubling are the Constitutional issues. Federalism
    is a core principle in our system of government and has proven
    to be a key component of effective energy and environmental
    policy. Unfortunately, the Clean Power Plan presents an
    unprecedented effort to tip the federal/state balance towards
    federal dominance over state electricity systems. Not
    surprisingly, officials from more than half the states have
    questioned EPA's legal authority to pursue this regulation.
        At risk is the discretion states have always had over the
    electricity generation mix. For example, my home state of
    Kentucky has chosen to rely mostly on coal to provide
    affordable and reliable electricity for its consumers and
    businesses. As a result, we are fortunate to have some of the
    lowest electricity rates in the country. Other states have
    chosen their own paths as they see fit to best serve their
    citizens' needs. But under the Clean Power Plan, each state's
    electricity plan would have to meet EPA's criteria for reducing
    carbon dioxide emissions and be approved by the agency.
        Any state that does not have a plan approved by the
    Administrator of the EPA would be subject to a Federal plan
    being imposed on it. EPA has yet to tell us what this federal
    plan would entail, but it is unlikely to be a viable option so
    much as an approach to compel states to submit to EPA demands
    in order to get their state plans approved.
        Given the Constitutional, statutory, and other legal issues
    surrounding the Clean Power Plan, I don't believe it will
    withstand judicial scrutiny. Given the tight deadlines under
    the proposed rule, states will be facing a decision about
    whether to submit their plans and initiate costly steps towards
    compliance before judicial review is complete. This would be
    unfortunate, because whether or not the Clean Power Plan is bad
    law, it certainly is bad policy.
        Even Administrator McCarthy has admitted that none of EPA's
    climate rules would actually make a measurable difference on
    future temperatures. The Clean Power Plan will, however, make a
    difference in many areas of the country to those who pay an
    electric bill.
        Indeed, the very purpose of the proposed rule is to replace
    affordability considerations with environmental ones in each
    state's electricity system. One study by NERA puts the total
    cost at $366 billion through 2031 and estimates increases in
    electricity prices of 12 percent or more. Beyond costs, there
    are highly credible warnings that ratepayers would face
    reliability risks, which already are a concern because of
    several other EPA rules targeting coal-fired generation but
    would get worse under the Clean Power Plan. No wonder states
    are fighting back against EPA.

        Mr. Whitfield. And with that, I would like to recognize the
    gentleman from California for his 5-minute opening statement.

     OPENING STATEMENT OF HON. JERRY MCNERNEY, A REPRESENTATIVE IN
                 CONGRESS FROM THE STATE OF CALIFORNIA

        Mr. McNerney. Thank you, Mr. Chairman.
        You mentioned this is the first hearing on this issue this
    year, but it is our fourth hearing on this issue in the last
    few years. So climate change is here. I mean it is happening.
    It is not a matter of speculation. We need to take action; we
    need to take it now. The longer we wait to take action on
    climate change, the more expensive it is going to be, the more
    damaging the effects of climate change are going to be, so it
    is incumbent upon us to do something about it. But the good
    news is that if the United States takes the lead, then we are
    going to be able to develop the technology, we are going to be
    able to export jobs, I mean we are going to be able to export
    materials, it is going to be a win for the United States, so we
    might as well embrace this now. Taking steps to curb carbon
    emission will have beneficial impacts such as repairing and
    replacing aging infrastructure with very high efficiency
    infrastructure.
        Now, I know that the coal producers are worried about this,
    but my advice to them is embrace carbon sequestration. Embrace
    it, because coal is going to be reduced whether we like it or
    not, but if we embrace carbon sequestration, then we will be
    able to continue to use coal and keep those important American
    jobs. So that is my advice to the coal producers. But we are
    going to be able to increase our clean energy sources,
    renewable energy, energy efficiency and so on. So I think this
    is an opportunity for us.
        Now, the Clean Air Act does give the EPA administrator the
    authority to put in place measures to reduce carbon dioxide
    production, and authority has been upheld in the courts. Now, I
    think we are going to hear some opinions about that this
    morning, but it has already been upheld in the courts.
        Now, the EPA's proposal, in my opinion, is reasonable. It
    includes energy efficiency, it includes looking for new, more
    efficient sources of energy, and using demand issues to help us
    reduce our carbon emissions. Now, the administration does have
    the responsibility to take action to protect us from the
    effects of climate change, so that is exactly what the Clean
    Power Plan does. Fourteen states in the United States,
    including my home state of California, have embraced this
    proposal. In a letter to the EPA, they wrote that even greater
    levels of cost-effective carbon pollution reductions from the
    power sector are achievable in this time frame, using the
    system described by the EPA. The EPA found that the power
    sector could reduce its emissions by 26 percent below the 2005
    levels under this initiative. That is a lot. Twenty-six percent
    reduction of the 2005 levels. That is significant, and that has
    put us in a leadership position. It has given other countries
    like China a motive to start reducing their carbon emissions,
    which is absolutely critical if we want to reduce carbon
    emissions in time to prevent the worst impacts of climate
    change. So this is really a win-win. But another thing that is
    really important is that the level of the amount of outreach
    that was done with this proposal was really unprecedented. The
    rule that we have in front of us is not final, so it is
    important for us to continue examining this issue, and to hear
    from all the stakeholders, and work together to find something
    that is going to benefit our Nation, put is in a leadership
    position, increase the economy, economic growth, and help stop
    climate change before the worst impacts are felt throughout the
    United States and throughout the world.
        So with that, I am going to yield back, Mr. Chairman.
        Mr. Whitfield. Thank you, Mr. McNerney.
        At this time, I would like to recognize the chairman of the
    full committee, Mr. Upton, for 5 minutes.

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

        Mr. Upton. Thank you, Mr. Chairman.
        Today we continue our examination of what many folks
    believe is the most problematic of all the global warming-
    related regulations being churned out by this Administration;
    the proposed Clean Power Plan by EPA. And I welcome our
    witnesses who are going to be discussing both the legal and
    cost concerns with this proposed rule, as well as the looming
    compliance difficulties at the state level.
        The Clean Air Act has been around since 1970, and we know
    from experience that it works best when implemented in the
    spirit of cooperative federalism. We have proven that we can
    accomplish a great deal to improve air quality when federal and
    state governments work together as partners. However, this
    proposed rule yanks the rug out from underneath the states with
    EPA dictating to the states, and effectively micromanaging
    intrastate electricity policy decisions to a degree even the
    agency admits is unprecedented. This raises a broad array of
    legal issues, not to mention that it is bad policy.
        As a result, many states are sounding the alarm about the
    legality of the rule and the implications for their citizens
    and their ratepayers. In addition to significant constitutional
    and other legal questions, states have expressed concerns about
    the feasibility of EPA's proposed requirements and the likely
    impacts on electricity costs and reliability. The risks to
    ratepayers are especially serious in states that rely on coal
    for a substantial part of their electricity generation. Under
    the Clean Power Plan, states would be forced to redesign their
    electricity generation, transmission, and distribution systems
    and related laws and policies, and to do so over a short time
    frame. Longstanding policies would be essentially wiped clean,
    and jobs and family budgets could suffer as a result,
    particularly for the most vulnerable.
        Today, we are going to hear several perspectives from both
    legal experts and state environmental and energy regulators. I
    am particularly concerned about the impacts on states, such as
    Michigan, which have a significant manufacturing sector.
    American manufacturers have shown that they can compete with
    anyone in the world, unless they face an uneven playing field
    caused by unilateral regulations like the EPA's proposed plan.
        Other EPA regulations like the Utility MACT rule have
    already contributed to rising electric rates and growing
    concerns about reliability. With the economy still far from
    fully recovered, the last thing job creators need is another
    expensive regulation likely to drive up energy prices. And the
    last thing struggling families need is to see their electric
    bills go up as well.
        So I hope that today's hearing will inform our efforts to
    develop commonsense policies that will ensure that electricity
    remains affordable and reliable in the coming decades. Jobs and
    the economy certainly are very important, and they remain our
    focus, and we will continue to work to keep the lights on and
    the electricity bills affordable.
        And I yield to other Republicans wishing to speak. Seeing
    none, I yield back the balance of my time.
        [The prepared statement of Mr. Upton follows:]

                     Prepared statement of Hon. Fred Upton

        Today we continue our examination of what many folks
    believe is the most problematic of all the global warming-
    related regulations being churned out by the Obama
    administration EPA--the proposed ``Clean Power Plan.'' I
    welcome our witnesses who will be discussing both the legal and
    cost concerns with this proposed rule as well as the looming
    compliance difficulties at the state level.
        The Clean Air Act has been around since 1970, and we know
    from experience that it works best when implemented in the
    spirit of cooperative federalism. We have proven that we can
    accomplish a great deal to improve air quality when federal and
    state governments work together as partners. However, this
    proposed rule yanks the rug out from under states, with EPA
    dictating to states and effectively micromanaging intrastate
    electricity policy decisions to a degree even the agency admits
    is unprecedented. This raises a broad array of legal issues,
    not to mention that it is bad policy.
        As a result, many states are sounding the alarm about the
    legality of the rule and the implications for their citizens
    and ratepayers. In addition to significant Constitutional and
    other legal questions, states have expressed concerns about the
    feasibility of EPA's proposed requirements and the likely
    impacts on electricity costs and reliability.
        The risks to ratepayers are especially serious in states
    that rely on coal for a substantial part of their electricity
    generation. Under the Clean Power Plan, states would be forced
    to redesign their electricity generation, transmission, and
    distribution systems and related laws and policies, and to do
    so over a short timeframe. Longstanding policies would be
    essentially ``wiped clean,'' and jobs and family budgets could
    suffer as a result.
        Today, we will hear several perspectives from both legal
    experts and state environmental and energy regulators. I am
    particularly concerned about the impacts on states, such as my
    state of Michigan, which have a significant manufacturing
    sector. American manufacturers have shown that they can compete
    with anyone in the world--unless they face an uneven playing
    field caused by unilateral regulations like the EPA's proposed
    plan.
        Other EPA regulations like the Utility MACT rule have
    already contributed to rising electric rates and growing
    concerns about reliability. With the economy still far from
    fully recovered, the last thing job creators need is another
    expensive regulation likely to drive up energy prices. And the
    last thing struggling families need is to see their electric
    bills continue to go up.
        I hope that today's hearing will inform our efforts to
    develop commonsense policies that will ensure that electricity
    remains affordable and reliable in the coming decades. Jobs and
    the economy. That remains our focus. We will continue working
    to keep the lights on and the electric bills affordable.

        Mr. Whitfield. Gentleman yields back.
        At this time, I would like to recognize the gentleman from
    New Jersey, Mr. Pallone, the ranking member on the committee, 5
    minutes.

    OPENING STATEMENT OF HON. FRANK PALLONE, JR., A REPRESENTATIVE
                IN CONGRESS FROM THE STATE OF NEW JERSEY

        Mr. Pallone. Thank you, Chairman Whitfield.
        As we sit here today, unchecked climate change continues to
    reshape our world. According to NOAA, 2014 was the warmest year
    ever recorded, and 9 of the 10 hottest years have occurred
    since 2000. We know this warming is due to carbon pollution
    from fossil fuels accumulating in the atmosphere, trapping more
    heat and changing our climate. We can already see the effects
    of this warming in rapidly-melting ice sheets and glaciers,
    extreme droughts and wildfires, increased storm damages,
    shrinking coral reefs, and beyond. Globally, the cost of these
    impacts easily reach into billions of dollars each year, and
    that trend shows no sign of slowing down.
        To that end, EPA has proposed a workable plan to reduce
    emissions of carbon pollution from power plants, which are the
    largest uncontrolled source of manmade greenhouse gases in the
    U.S. Today, we will hear more about the Clean Power Plan, but
    there are few features that merit emphasizing in advance.
    First, the Clean Power Plan is not a one-size-fits-all proposal
    for reducing emissions. It uses a flexible state-based approach
    that takes account of each individual state's unique capacity
    to reduce emissions from its electricity sector. Second, EPA is
    not proposing that states act overnight. States have until 2030
    to meet their final goals, and the plan's interim goals don't
    begin until 2020. Third, the Clean Power Plan falls well within
    the legal authority and responsibility of EPA to address carbon
    pollution from power plants. This system-wide approach is based
    on the plain language of the Clean Air Act. And finally, and
    perhaps most importantly, the Clean Power Plan is just a
    proposal and is not yet finalized.
        EPA received over 3 \1/2\ million public comments on the
    Clean Power Plan, and is reviewing these comments as we speak.
    EPA can and will make adjustments to its proposal. EPA is
    looking hard at a range of issues relating to timing,
    reliability, technical, and legal issues, and EPA is working in
    close coordination with states, utilities, grid operators, and
    other federal agencies like DOE and FERC to make sure the plan
    is done right.
        And there are those who deny science. They claim that
    climate change is not real or manmade, that it is caused by
    natural cycles or sunspots, and that simply is untrue. The
    world's leading scientists have told us that climate change is
    happening, is caused by humans, and will have extremely serious
    impacts. The Republican-led Congress has not listened to the
    scientists, and has yet to take action to address these serious
    climate threats. And just saying no isn't an option anymore. We
    must reduce our carbon emissions, and the Clean Power Plan is a
    reasonable first step.
        So those who have concerns with EPA's plan have a
    responsibility, in my opinion, to not just criticize it, but
    also to propose alternative ways to achieve the same goal.
    There are always those who are willing to make absurd arguments
    on behalf of companies that profit from the status quo, and we
    will hear today from some of these that EPA's plan is not
    legal, that it is unworkable, that some states may refuse to
    participate, but I think that those making those arguments
    aren't really interested in finding solutions to our carbon
    pollution problem. They are not interested in developing a plan
    to help us reduce emissions while still maintaining a safe,
    reasonably-priced electricity system. To quote the words of EPA
    Administrator McCarthy, they are just trying to put their heads
    in the sand. They are more than welcome to do that but history
    will not treat them kindly. Keep this in mind as we listen
    today and during future hearings and debates on the Clean Power
    Plan. I think you will be able to recognize those who are
    simply arguing for inaction on behalf of entrenched fossil fuel
    interests, and compare them to those who want to act on climate
    change, and also want the development of our path forward to be
    thoughtful, sensible, and effective.
        So for my part, I am in the latter camp, and I urge all of
    my colleagues to join me. And I look forward to hearing from
    the witnesses.
        I don't think anybody on my side wanted time, is that
    correct? So I will just yield back my time. Thank you, Mr.
    Chairman.
        Mr. Whitfield. Gentleman yields back. Thank you very much.
        And that concludes our opening statements. So now we will
    turn to our panel of witnesses, and I am going to introduce
    each one of you individually before you give your opening
    statements.
        So our first opening statement will be given by Mr.
    Laurence Tribe, who is the Carl M. Loeb University Professor
    and Professor of Constitutional Law, Harvard. Professor Tribe,
    welcome, and we look forward to your testimony. You are
    recognized for 5 minutes, and be sure to turn the microphone on
    because it is not on automatically. So thank you.

       STATEMENTS OF LAURENCE H. TRIBE, CARL M. LOEB UNIVERSITY
    PROFESSOR AND PROFESSOR CONSTITUTIONAL LAW, HARVARD LAW SCHOOL;
    ALLISON D. WOOD, PARTNER, HUNTON AND WILLIAMS LLP; AND RICHARD
       L. REVESZ, LAWRENCE KING PROFESSOR OF LAW, DEAN EMERITUS,
     DIRECTOR, INSTITUTE FOR POLICY INTEGRITY, NEW YORK UNIVERSITY
                             SCHOOL OF LAW

                     STATEMENT OF LAURENCE H. TRIBE

        Mr. Tribe. Mr. Chairman, members of the committee, I am
    honored to testify about EPA's proposed CO2 power
    plant regulations. I have submitted my full written statement
    for the record.
        EPA's proposal raises grave constitutional questions,
    exceeds EPA's statutory authority, and violates the Clean Air
    Act.
        First, the plan conflicts with settled principles of
    federalism and Supreme Court precedent because it would
    commandeer state governments, treating them more like
    marionettes, dancing to the tune of a federal puppeteer, than
    like laboratories of democracy. It would dictate the
    CO2 emissions target that each state must adopt
    within a year, commanding every state to enact an EPA-approved
    package of laws meeting that target by requiring power plants
    to shut down or reduce operations, consumers and businesses to
    use less electricity and pay more for it, and utilities to
    shift from coal to natural gas and other energy sources; a
    total overhaul of the states' way of life.
        Now, reducing states to this submissive role would confound
    the political accountability that the Tenth Amendment
    guarantees. EPA's plan would increase energy costs over local
    opposition, while cloaking that increase in the Emperor's garb
    of state choice, with state governments taking the blame for
    policies actually dictated and necessitated by EPA. A state
    that submits no plan meeting EPA's approval by 2016 confronts a
    centrally-planned and administered federal scheme of uncertain
    scope, burdening the state of its citizens backed by draconian
    sanctions like the loss of federal funds under preexisting
    antipollution programs. Prominent defenders of the EPA's
    proposal necessarily concede that noncomplying states gambling
    on whatever unpredictable backup plan EPA might impose would be
    at a huge disadvantage.
        EPA's proposal also presents serious Fifth Amendment
    problems. We are all CO2 emitters, and atmospheric
    CO2 is the intermingled result of all human
    activity, but EPA would impose costs, that ought to be borne
    equitably by everyone, on a small group of power plants and
    companies after requiring those same companies to invest
    billions of dollars to reduce their non-CO2
    pollutants over the past 25 years. The Constitution demands
    just compensation to rectify that bait and switch.
        Now, courts would never assume a congressional design to
    confer such revolutionary and constitutionally dubious power on
    EPA unless Congress clearly said so. But far from it, under the
    very Clean Air Act provision that EPA invokes, Section 111(d),
    Congress expressly prohibited EPA from doing exactly what it
    proposes to do here: regulate emissions from coal-fired power
    plants under Section 111(d), when those same power plants are
    already being regulated in costly ways under Section 112. In
    1995, EPA itself read the Clean Air Act to prohibit such
    duplication, as did the D.C. Circuit Court of Appeals in 2008,
    and the U.S. Supreme Court in 2011.
        If the Clean Air Act's meaning were ambiguous, and it
    isn't, settled principles of statutory interpretation would
    mean that EPA and any reviewing court would have to interpret
    the Act to avoid the constitutional difficulties that EPA's
    interpretation raises under the Fifth and Tenth Amendments.
    Now, to circumvent that avoidance principle, EPA resorts to
    sheer fantasy. It claims that Congress enacted a law in 1990
    that never made it into the U.S. Code, and that everybody has
    been using the wrong version of the statute for the past
    quarter century. Really? Crediting that story would call into
    question dozens of similar statutory provisions throughout the
    U.S. Code. The tale is pure fiction. There is no mistake in the
    U.S. Code, but even if Congress had truly tossed two different
    bills in the air and told EPA to decide which one to catch and
    run with, that would be a power Congress could not give away,
    and EPA could not recognize and exercise. It is a law-making
    power that belongs only to you, backed by a judicial power that
    belongs only to the courts.
        EPA is attempting an unconstitutional trifecta; usurping
    the prerogatives of the states, Congress and the federal courts
    all at once. Much is up for grabs in this complex area, but
    burning the Constitution of the United States, about which I
    care deeply, cannot be part of our national energy policy to
    deal with the problems of climate change.
        Thank you very much.
        [Mr. Tribe's testimony has been retained in committee files
    and can be found at:http://docs.house.gov/meetings/if/if03/
    20150317/103073/hhrg-114-if03-wstate-tribel-20150317-u1.pdf.]
        Mr. Whitfield. Thank you, Professor Tribe.
        At this time, our next witness is Allison Wood, who is a
    partner at Hunton and Williams. And welcome. We appreciate you
    being here, and you are recognized for 5 minutes.

                      STATEMENT OF ALLISON D. WOOD

        Ms. Wood. Good morning. It is an honor to appear before
    this subcommittee to offer testimony on EPA's proposed Section
    111(d) rule.
        I have practiced environmental law for over 16 years, and
    for the past decade, my practice has focused almost exclusively
    on climate change.
        EPA's proposed rule suffers from a great many legal
    infirmities, and I will focus on two of those today. The first
    defect is that EPA is prohibited from regulating electric
    generating units under Section 111(d) because those units are
    already subject to regulation under a different provision of
    the Clean Air Act, Section 112, which regulates sources of
    hazardous air pollutants.
        Section 111(d) has always been a little-used provision of
    the Clean Air Act that was designed to catch the handful of
    sources that were not regulated under the Act's other major
    provisions. Indeed, this provision has been used to regulate
    sources only five times since 1970. The confusion over this
    point comes from two amendments that were made to Section
    111(d) during the 1990 amendments to the Clean Air Act, both of
    which appear in the Statutes at Large. EPA claims this leads to
    ambiguity, but in fact, the codifiers properly included in the
    United States Code only the House amendment; the amendment that
    clearly precludes regulation under Section 111(d) of source
    categories that are regulated under Section 112. This was
    appropriate, given that the managers of the Senate bill had
    expressly receded to the House amendment.
        The second legal defect involves EPA's overbroad
    interpretation of the term system of emission reduction in
    Section 111. In every other rulemaking under Section 111(d),
    EPA looked at existing sources to see what technology and
    processes were in place to limit pollution. EPA then based its
    determination of the best system of emission reduction for
    those types of existing sources on the known and demonstrated
    technologies and processes that were in use. States then
    applied the system of emission reduction to existing sources
    within their borders that did not yet have these pollution
    controls, while taking into account several factors including
    the source's remaining useful life.
        In this rulemaking, EPA turns this established procedure on
    its head and proposes for the first time a standard of
    performance that is based on not operating the source. EPA
    claims for the first time, based on the dictionary definition
    of the word ``system,'' that it can regulate any set of things
    that leads to reduced emissions from the source category
    overall, even if those things go beyond the fence line of the
    plant. EPA's new interpretation is fundamentally flawed. A
    system of emission reduction must begin and end at the source
    itself. EPA's interpretation would allow the agency endless
    regulation over all manner of things that are completely
    outside its purview. To use an illustration that may help
    people better understand what EPA is proposing to do here, it
    is as if EPA were requiring car owners not only to have
    catalytic converters on their cars, but also to travel a
    certain amount of days per week by bus, purchase a certain
    number of electric vehicles, and work from home one day a week.
    All of these things would reduce overall car emissions, but
    they do nothing to reduce the rate at which those cars emit
    pollutants per mile, and most people would surely agree that
    the Clean Air Act would not allow EPA to require these types of
    things from car owners, yet, this type of regulation is exactly
    what EPA is trying to do to power plants in the Section 111(d)
    rule.
        Finally, it should be noted that litigation over this rule
    will absolutely occur when it is finalized. Unfortunately,
    litigation takes time, and states are going to be forced to act
    before courts determine whether the Section 111(d) rule is
    lawful. State plans must be submitted within 1 year after the
    rule is finalized, unless a partial plan is submitted and EPA
    grants an extension. These plans will be very complex, and
    states have never before had to submit a plan under Section
    111(d) of this magnitude. Many states will need to pass
    legislation as part of their plan preparation. Regulations will
    need to be promulgated. Litigation will not be resolved before
    these things happen. Under this timing, any victory the states
    achieve will end up being hollow. A victory will not be able to
    give the states back the resources that were expended in plan
    development, nor will it solve the issue of states having to go
    through the time-consuming and uncertain process of unwinding
    legislation and regulations that were passed to put the plan in
    place.
        Thank you again for the opportunity to testify today.
        [The prepared statement of Ms. Wood follows:]
        [GRAPHICS NOT AVAILABLE IN TIFF FORMAT]

        Mr. Whitfield. Thank you, Ms. Wood.
        At this time, our third witness is Professor Richard
    Revesz, who is the Lawrence King Professor of Law, Dean
    Emeritus, Director of Institute for Policy Integrity at the New
    York University School of Law. And thank you very much for
    being with us today, Professor, and you are recognized for 5
    minutes.

                     STATEMENT OF RICHARD L. REVESZ

        Mr. Revesz. Thank you, Mr. Chairman, and thank you for
    inviting me to testify before the committee.
        My written testimony covers four main points. First, the
    Clean Power Plan is a natural extension of previous EPA
    policies stretching back decades, and promulgated under both
    Republican and Democratic administrations, that use flexible
    compliance mechanisms to address the environmental harms of
    power production. Second, the Clean Power Plan does not give
    rise to any constitutional problems. Third, EPA has clear
    authority to implement the Clean Power Plan under Section
    111(d) of the Clean Air Act. And fourth, EPA's proposed
    guidelines in Section 111(d) are authorized by the statute and
    based upon demonstrated approaches that some utilities and
    states have already taken to reduce greenhouse gas emissions.
        On the first point, for the past quarter of a century, each
    President has taken measures to regulate the emissions of
    existing power plants because they are the Nation's largest
    sources of many harmful air pollutants, including mercury,
    sulfur dioxide, and carbon dioxide. Under the Administration of
    President George H. W. Bush, Congress enacted a 1990 amendment
    which capped sulfur dioxide emissions from existing power
    plants, and established an innovative trade mechanism to
    achieve reductions as cheaply as possible. Later, the
    Administrations of President Bill Clinton, George W. Bush, and
    Barack Obama each promulgated important regulations requiring
    existing power plants to reduce emissions of smog and
    particulate precursors that negatively affect the air quality
    in downwind states, again using cost-effective flexible trading
    mechanisms. And finally, the Administrations of both President
    George W. Bush and Barack Obama issued rules limiting emissions
    of mercury from existing plants.
        Like these earlier programs, EPA's Clean Power Plan will
    cost-effectively reduce pollution from existing power plants
    through a flexible program that enables states to rely on
    traditional regulation, emissions trading, or any other tool
    that they may prefer.
        My second point on the constitutional issues. The first
    claim made by opponents is there is a problem with the way
    Congress delegated regulatory power to EPA under Section 111(d)
    because the House and Senate passed arguably inconsistent
    amendments to the provision in 1990. Both the House and Senate
    versions were then included in a conference bill that was
    passed by each chamber and signed by President George H. W.
    Bush. In all of our history, the Supreme Court has struck down
    only two statutory provisions as constitutionally impermissible
    delegations to an administrative agency, both in the mid-
    1930's, during its skirmishes with President Franklin Roosevelt
    over the New Deal. Supreme Court has never invalidated a
    federal statue on non-delegation grounds on the basis of the
    argument that opponents of the Clean Power Plan now advance:
    that a statute has arguably inconsistent provisions. Instead,
    the courts have consistently dealt with this problem by finding
    ways to develop a workable interpretation of the statute.
        Opponents of the Clean Power Plan make a similarly
    farfetched argument the plan violates the Takings Clause of the
    Fifth Amendment, which protects private property rights. A
    regulation leads to a Takings violation only if it deprives an
    owner of essentially all of the value of his or her property,
    which is not the case here. And even if it were, the
    appropriate remedy is a subsequent suit for compensation, not
    the invalidation of a nationwide rule.
        Finally, opponents claim that the Clean Power Plan runs
    afoul of the Tenth Amendment's prohibition against the
    commandeering of state institutions by the Federal Government.
    This extreme and unsupported interpretation of the Tenth
    Amendment would invalidate many of the core provisions of the
    Clean Air Act, not only Section 111(d), in fact, it is the
    basis for how the National Ambient Air Quality Standards under
    the Clean Air Act, which are the centerpiece of the statue, and
    have been its centerpiece since 1970, are administered. And
    nothing here is commandeered anyway. The states are merely
    given the option to submit plans if they choose to do so. If
    they do not, the Federal Government has the authority to impose
    federal implementation plans that give rise to no
    constitutional problem at all because they do not involve state
    institutions.
        The third point, the statutory point. Congress passed two
    amendments: the House Amendment and the Senate Amendment. The
    opponents of the Clean Power Plan would like us to ignore the
    Senate Amendment because it was not included in the U.S. Code
    by the Office of Law Revision Counsel, but everyone knows that
    a mere functionary cannot supplant the will of Congress. To do
    so would violate the principles of bicameralism and
    presentment. And in any event, even the House Amendment, which
    the opponents of the Clean Power Plan would like to credit, is
    not subject to a single interpretation; it is subject to
    multiple interpretations, and under traditional principles of
    statutory construction, the interpretation by the agency, by
    EPA, is entitled to deference in the courts.
        And finally, on the claim that the Clean Power Plan
    violates some provision of the Clean Air Act because it
    regulates beyond the fence line, the product here is
    electricity, not electricity produced by coal, and EPA has the
    authority to define the system in that way, and has done so.
        Thank you very much, and I would be delighted to answer
    questions.
        [The prepared statement of Mr. Revesz follows:]
        [GRAPHICS NOT AVAILABLE IN TIFF FORMAT]

        Mr. Whitfield. Thank you, Professor Revesz. And thank all
    of you for your statements.
        At this time, the members have an opportunity to ask
    questions, and I would like to recognize myself for 5 minutes
    at this time.
        Ms. Wood, we have heard a lot of discussion about inside
    the fence and outside the fence, and as I said in my opening
    statement, this regulation has been characterized in a lot of
    different ways; extreme, radical, power grab. Would you explain
    from your perspective of why this is so significantly different
    in that it allows outside-the-fence solutions?
        Ms. Wood. Outside the----
        Mr. Whitfield. Turn your microphone on.
        Ms. Wood. Yes, thank you. The outside-the-fence line
    nomenclature is being used a lot. Indeed, you can't even go
    beyond the source itself. So here we are talking about the
    actual electric generating unit. And the reason why people talk
    a lot about going beyond the fence line with this rule is that,
    of the four building blocks that are set forth in the rule,
    only one of them actually gets any kind of emission reduction
    at the source itself, and that is building block one that has
    to do with energy efficiency improvements that can be made.
        All of the other building blocks take place somewhere else
    beyond the source, outside the fence line. This has never been
    the case with any other rulemaking under Section 111(d).
        Mr. Whitfield. Never been the case before?
        Ms. Wood. No.
        Mr. Whitfield. I take it that a state would even be able to
    mandate the type of material used in a building under this
    regulation if it is adopted. Would that be correct?
        Ms. Wood. It----
        Mr. Whitfield. In order to meet the overall emission cap.
        Ms. Wood. Right. Exactly. You could add building block five
    that would say you have to have Energy Star buildings to try to
    reduce----
        Mr. Whitfield. Right.
        Ms. Wood [continuing]. Energy consumption. I mean that
    could also arguably fall within the building block four, which
    is designed to have consumers use less electricity.
        Mr. Whitfield. I thought your illustration was very good
    about driving to work. You could be mandated to take a bus, you
    could be mandated to this vehicle or ride a bicycle certain
    days, whatever, but it doesn't do anything about reducing the
    emission of your automobile.
        Ms. Wood. Right, and that is exactly the point of beyond
    the source or beyond the fence line.
        Mr. Whitfield. Yes.
        Ms. Wood. The emission reductions that you would get----
        Mr. Whitfield. Yes.
        Ms. Wood [continuing]. From not driving your car one day a
    week have nothing to do with----
        Mr. Whitfield. Yes.
        Ms. Wood [continuing]. The car running and getting----
        Mr. Whitfield. Yes.
        Ms. Wood [continuing]. And emitting less pollution----
        Mr. Whitfield. Yes.
        Ms. Wood [continuing]. It has to do with the car not
    running.
        Mr. Whitfield. And so, Professor Tribe, do you agree that
    this inside-the-fence, outside-the-fence is a radical change
    for EPA?
        Mr. Tribe. Mr. Chairman, I agree very much that it is a
    radical change, and it is a radical change that bears on what
    this committee needs to think about in several ways. First of
    all, I think it shows how unrealistic is the claim that, you
    know, there is nothing going on here, just move along, don't
    bother, which is, I think, the essence of Professor Revesz's
    testimony. No constitutional problem, nothing new. But it is
    radically new. I mean we should all, I think, be honest with
    ourselves. Yes, many people think that there are severe
    problems that need to be addressed, but the question is do we
    care about the rule of law and how we go about addressing them.
        Mr. Whitfield. Right.
        Mr. Tribe. Now, the way that a court, if a court gets its
    hands on this, would look at the outside-the-fence issue isn't
    just as a technical matter, inside, outside, it would look at
    it in terms of no limiting principle.
        Mr. Whitfield. Right.
        Mr. Tribe. As a number of state attorneys general have
    said, if you--if the EPA can do this, it can tell you how often
    to use your electric toothbrush.
        Mr. Whitfield. And the EPA has even had legal memorandums
    themselves saying that they didn't think they had the authority
    to regulate under 111(d).
        Mr. Tribe. Yes, that is right. In 1995, they didn't think
    they had the authority. They were told in 2008 by the D.C.
    Circuit they didn't have the authority. In 2011, the U.S.
    Supreme Court told them they didn't have the authority, and
    they say never mind.
        Mr. Whitfield. Yes. Well, why wouldn't they regulate under
    Section 108?
        Mr. Tribe. Well, 108 to 110, with respect to the National
    Ambient Air Quality Standards, really don't fit this very well
    or else you could be sure that they would go that route. The
    reason they don't fit is that they are really based on state
    designation of geographical areas within the state as
    attainment, non-attainment or unclassifiable.
        Mr. Whitfield. Right.
        Mr. Tribe. I would hate to live in an unclassifiable area.
    But the point is that CO2 comingles with everything
    uniformly throughout the global atmosphere----
        Mr. Whitfield. Right.
        Mr. Tribe [continuing]. And so you really couldn't approach
    it by making the findings. And besides the findings that you
    would have to make under 108 to 110 would be very difficult to
    make, and would require a procedure that they haven't gone
    through.
        Mr. Whitfield. And they can't do it under 112 because
    CO2 is not a listed hazardous air pollutant.
        Mr. Tribe. Right, under 112, there are 188 hazardous air
    pollutants listed by Congress. Nobody claims that
    CO2, which is essential for life, is hazardous in
    that sense. They try to----
        Mr. Whitfield. Yes.
        Mr. Tribe [continuing]. Split hairs by saying, well, it may
    not be hazardous but it is dangerous. But we are not writing a
    novel here, but we are talking about a law passed by this body,
    and I am concerned that I have cared about the environment ever
    since I was a kid, and I taught the first environmental law
    course in this country, and I have won major victories for
    environmental causes, but I am committed to doing it within the
    law. And there is a legal way to address these problems. They
    tried to get cap and trade with this Administration, didn't
    work. And I guess the EPA is now following a kind of marching
    order saying, well, if you can't do it through the lawful way,
    just take an agency and tell it to bend and twist and tear and
    rip the law.
        When I use the metaphor that burning the Constitution is
    not a good source of fuel for dealing with these problems, I
    was being metaphorical only in part. When you tear the
    Constitution apart bit by bit, and give it the death by 1,000
    cuts, what else will we sacrifice the Constitution for?
        Mr. Whitfield. Thank you, Professor Tribe. My time has
    expired.
        At this time, I recognize the gentleman from California for
    5 minutes.
        Mr. McNerney. Thank you, Mr. Chairman.
        Mr. Revesz or Professor, would you describe what the
    Supreme Court actions have been thus far with regard to the EPA
    that is applicable to the Clean Air Plan?
        Mr. Revesz. Sure. The Supreme Court has never said any----
        Mr. McNerney. Your speaker.
        Mr. Revesz. Sorry. The Supreme Court has never said
    anything that raises any questions about the legality of the
    Clean Power Plan. In fact, the case that Professor Tribe
    mentioned from 2011, the American Electric Power case, actually
    stands for exactly the opposite proposition. I mean the Supreme
    Court decided to preempt federal common-law claims because it
    said that EPA had the authority to regulate the carbon dioxide
    emissions of plants under Section 111(d). And so the Supreme
    Court has not stood in the way of this kind of regulation.
    There isn't a single Supreme Court case that raises any
    constitutional question. As I indicated, non-delegation claim
    is not a serious one. The Supreme Court has never struck any
    federal statute down on these grounds since the mid-1930s, and
    here all we have are two different conflicting approaches to a
    provision, and that is exactly where the agency gets the first
    crack at interpreting, and then the courts review the agency's
    interpretation. And that is actually already going on. There
    has been a challenge to the proposed rule that is now pending
    in the D.C. Circuit, it is going be argued on April 16, and
    then the standard way that these things are going to happen,
    the D.C. Circuit will decide whether the agency's
    interpretation is right or is wrong, but there is no real
    constitutional issue there.
        The Takings claim, again, the Supreme Court--there isn't a
    single case that would support holding this to be a Takings. If
    some firm thinks that it has been deprived of the whole value
    of its property through this regulation, which seems extremely
    unlikely, it can bring an action for compensation. If it, in
    fact, has been deprived of the value of its property, it would
    presumably prevail, but that is not a reason for striking down
    a nationwide rule.
        And on the Tenth Amendment point, and I wanted to stress
    something that was very important, the cooperative federalism
    model that is the core of the Clean Air Act provides for
    federal standards, gives the states an opportunity to come up
    with state implementation plans, and if they don't, the Federal
    Government can act and impose a federal implementation plan.
    This is the scheme under Section 108 through 110 that the
    chairman mentioned. It is the way National Ambient Air Quality
    Standards are done in this country. These are the standards
    that have saved hundreds of thousands of lives. They are the
    most successful federal environmental program ever. And if
    Section 111(d) has the Tenth Amendment problem, as Professor
    Tribe ascribes to it, Section 109 would have exactly the same
    problem because it is exactly the same cooperative federalism
    model. And, in fact, Section 111(d) uses pretty much the same
    language as Section 109.
        These are programs that have been around for 45 years, that
    were passed through a bipartisan consensus, they form the
    fabric of our environmental laws, and there is nothing
    different here than there is under Section 109.
        Mr. McNerney. Well, I was going to ask you about the Tenth
    Amendment, but you sort of wandered into that so I don't need
    to ask that question.
        So with that, I will yield back the----
        Mr. Revesz. If I could say something about the
    unprecedented nature of this regulation that Professor Tribe
    and Ms. Wood alluded to. There is nothing of that sort. I mean
    just last term, the Supreme Court upheld an important EPA rule
    that regulates the interstate emissions where the statute says
    that it prohibits any source from emitting any air pollutant
    that will significantly contribute to environmental problems in
    downwind states. And EPA authorized states to adopt trading
    mechanisms that go beyond imposing controls on particular
    sources. This issue was litigated before the Supreme Court. Its
    opponents argued EPA didn't have the authority to do that
    because the statute said refer to any source, and in the end,
    the Supreme Court upheld that regulation on a 6-2 vote with
    Justices Scalia and Thomas dissenting.
        So that is a very comparable program. It is also part of
    the same effort to control the emissions of existing power
    plants because they are such important contributors to
    pollution in this country.
        Mr. McNerney. Thank you, Mr. Chairman.
        Mr. Whitfield. Gentleman yields back.
        At this time, recognize the gentleman from Texas, Mr.
    Barton, for 5 minutes.
        Mr. Barton. Thank you, Mr. Chairman.
        I don't normally reread parts of testimony, but I am going
    to in this case read the some of the paragraphs of Professor
    Tribe because I think he lays out pretty explicitly and clearly
    what this is all about. This is at least his executive summary
    of his testimony today, and I quote, ``EPA lacks the statutory
    and constitutional authority to adopt its plan. The obscure
    section of the Clean Air Act that EPA invokes to support its
    breathtaking exercise of power in fact authorizes only
    regulating individual plants and, far from giving EPA the green
    light it claims, actually forbids what it seeks to do. Even if
    the Act could be stretched to usurp state sovereignty and
    confiscate business investments the EPA had previously
    encouraged and in some cases mandated, as this plan does, the
    duty to avoid clashing with the Tenth and Fifth Amendments
    would prohibit such stretching. EPA possesses only the
    authority granted to it by the Congress. It lacks implied or
    inherent powers. Its gambit here raises serious questions under
    the separation of powers Article I and Article III because EPA
    is attempting to exercise lawmaking power that belongs to
    Congress, and judicial power that belongs to the federal
    courts. The absence of EPA legal authority in this case makes
    the Clean Power Plan quite literally a power grab. EPA is
    attempting an unconstitutional trifecta: usurping the
    prerogatives of the states, Congress, and the federal courts
    all at once. Burning the Constitution should not become part of
    our national energy policy.''
        Now, that is pretty straightforward. Professor Tribe, I
    assume that we would stipulate that you are an expert in the
    Constitution, is that fair to say?
        Mr. Tribe. Some people have said that.
        Mr. Barton. Some people have said that, OK. I would also
    assume that the committee can stipulate that you are an expert
    in regulatory authority or environmental issues, is that also
    fair to say?
        Mr. Tribe. Again----
        Mr. Barton. Some people say that?
        Mr. Tribe. Some people say it, right.
        Mr. Barton. Some people say that.
        Mr. Tribe. Yes.
        Mr. Barton. Well, would you say, and again I want to quote
    from another Supreme Court case, this is in the Supreme Court
    case back in 2001, Whitman v. the American Trucking
    Association, that Congress does not alter the fundamental
    details of a regulatory scheme in vague terms. It does not, one
    might say, hide elephants in a mouse hole. Would you say this
    is an attempt to hide an elephant in a mouse hole?
        Mr. Tribe. I would say, Mr. Chairman, that it is an attempt
    to hide a very large constitutionally-troubled elephant in a
    very tiny mouse hole, and not a mouse hole that was accurately
    described, I might add, by Professor Revesz. Let me give you,
    if I might, just one example. He----
        Mr. Barton. Be quick because----
        Mr. Tribe [continuing]. Talked about----
        Mr. Barton [continuing]. I only have a minute and a half
    left.
        Mr. Tribe. Well, he just misdescribed the cases. The case
    of AEP v. Connecticut, he said Congress--the Supreme Court said
    that the EPA has this power, except the majority opinion in
    footnote 7 said there is an exception under 111(d), you can't
    use this power to regulate a source that is already being
    regulated under 112. Professor Revesz conveniently left out the
    only part of this case that is relevant.
        He also says that--well, I shouldn't take your time.
        Mr. Barton. Well, let me just reclaim my time.
        I was on the committee in 1990. I don't think Mr. Green
    was. I am not sure anybody else currently here was on the
    committee. Mr. Pallone may have been, I am not sure, but I
    participated in these debates. I was not on the Conference
    Committee between the House and the Senate so I can't claim
    personal knowledge, but I was on the committee and I was
    actively engaged in a bipartisan fashion in crafting this law,
    and we had a coalition of conservative Democrats, like Billy
    Tauzin and Ralph Hall and Mike Synar on the Democrat side with
    the Republicans, and Mr. Dingell, who was chairman at the time,
    kind of played us back and forth, but there was never a debate
    in the committee that would interpret the Clean Air Act
    amendments as the proponents of the Clean Power rule. Never. It
    was never. Just the opposite. Just the opposite.
        And, Mr. Chairman, I hope after the conclusion of these
    hearings, that we move legislation on a bipartisan basis that
    explicitly clarifies this point. The EPA has a right to set a
    national standard in interstate commerce to protect public
    health. It does not have the right to go in and micromanage how
    a state complies with a national standard which, as I
    understand it, is exactly what this Clean Power Plan does.
        And with that, I yield back.
        Mr. Whitfield. Thank you, Mr. Barton.
        At this time, recognize the gentleman from New Jersey, Mr.
    Pallone, for 5 minutes.
        Mr. Pallone. Thank you, Mr. Chairman.
        I am a little surprised by some of the legal arguments we
    are hearing against the Clean Power Plan, but I guess I have
    been around long enough to know that you can get constitutional
    lawyers and professors to say anything on both sides, just like
    you can get lawyers at home to say anything on both sides. So I
    just wanted to give Professor Revesz some time to comment on
    some of the comments that have been made by Professor Tribe.
    For instance, we are hearing that the Clean Air Act actually
    prohibits EPA from issuing the Clean Power Plan, however, the
    Supreme Court disagrees, citing American Electric Power v. the
    Connecticut case, if need be. An argument is also being made
    that since EPA acted to regulate mercury pollution from power
    plants, EPA does not have the authority to issue the Clean
    Power Plan. So, Professor Revesz, is this argument a reasonable
    interpretation of the law?
        Mr. Revesz. No. Several things. First, on the American
    Electric Power case that we have now been arguing, there is
    footnote 7. I am very familiar with it. Footnote 7 is subject
    to more than one interpretation. In fact, I am holding the
    Brief of the Federal Government in the D.C. Circuit case, and
    the Federal Government is interpreting this differently--the
    footnote differently. It is interpreting the footnote not to
    stand in the way of exactly what EPA is doing on the Clean
    Power Plan. On the standard techniques of statute
    interpretation, EPA, as the agency empowered by Congress to
    administer the statute, deserves deference. This is EPA's
    interpretation. EPA's interpretation is consistent with the
    argument I made, not with the argument Professor Tribe made.
        Now, Professor Tribe may, in fact, be ultimately right.
    That is for a court to decide. I believe that he is wrong. EPA
    believes that he is wrong. And we will find out, this issue
    will be argued extensively on April 16 before the D.C. Circuit.
        On the question about whether EPA cannot regulate under
    Section 111(d) because it has regulated mercury emissions under
    Section 112, that is wrong as well. There are two amendments.
    There is a House Amendment and a Senate Amendment. They were
    both passed. Now, it turns out that only one of them was
    included in the U.S. Code. That was a decision made by a mere
    functionary. This is the Office of Law--of--something or other.
    Of Legislative Counsel. That person cannot supplant the will of
    Congress, and that is well established. So EPA has, for 25
    years, under Administrations of both parties, sought to give
    meaning to both the House Amendment and the Senate Amendment.
        The opponents would like us to ignore the Senate Amendment
    entirely, and they would like to give the House Amendment a
    particular gloss, and it is a gloss that involves rewriting the
    statute. The statute uses two--twice the word or, and they
    would like us to instead supplant the word and. The word and
    would be more convenient for them, but actually, the statute
    has the word or. So not only would we have to ignore the Senate
    Amendment, which there is no basis for doing, but we also would
    have to rewrite the House Amendment, and we would have to go
    through an additional hurdle which is not giving EPA the
    deference that it is due under traditional principles of
    statutory interpretation as embodied in the Chevron case.
        If I can make one related point. On this analogy to cars, I
    don't think that the analogy to cars really works here because
    in the car example that Ms. Wood referred to, the product is
    the car, and if EPA wants to regulate cars it can regulate
    cars, and regulate the emissions of cars, as it does and has
    done since the early 1970s. Here, the product is electricity.
    It is not electricity produced by coal-fired power plants, it
    is electricity. And as you know, we have an integrated system
    for delivering usable electricity to consumers, and EPA can
    figure out what the best system of emission reduction for
    delivering usable electricity to consumers is.
        Let me give you an example. When I was growing up in
    Argentina, where I was born, when I had a fever my mother would
    give me a mercury thermometer. These things aren't sold in this
    country because they are dangerous, and instead, we use digital
    thermometers. If using the logic of the opponents of the Clean
    Power Plan, the product would be a mercury thermometer as
    opposed to a thermometer and, therefore, a regulation that
    might actually bring mercury thermometers out of business might
    be considered suspect, but we have never used a principle like
    this for regulation in this country, for good reason, because
    doing so entrenches bad technologies and stands in the way of
    innovation. The product here is not electricity produced by
    coal-fired power plants, it is usable electricity delivered to
    the consumers' home.
        Mr. Pallone. Thank you, Mr. Chairman.
        Mr. Whitfield. Thank you.
        At this time, recognize the gentleman from Texas, Mr.
    Olson, for 5 minutes.
        Mr. Olson. I thank the chair. And welcome, Professor Tribe,
    Ms. Wood, and Professor Revesz.
        This hearing is about one document; this Constitution. I
    have had this in my pocket for over 2 decades now. It is kind
    of worn, comes out by pages, but it is still is very much
    alive.
        And my first question is to you, Ms. Wood. Under EPA's
    proposed Clean Power Plan, states would have only 13 months to
    develop their state plans. Is that 13 months by statute? If
    not, where does that mandate come from?
        Ms. Wood. No, the 13 months is not from statute. The 13
    months is just a deadline that EPA has come up with in this
    proposed rule. Under the applicable regulations, the deadline
    is actually 9 months for a state to submit its plan, but the
    regulations are very clear that EPA can extend that deadline as
    it sees fit, so it has wide discretion there. So it has
    actually extended it from 9 months to 13.
        Mr. Olson. Wow, 4 more months. Now correct me if I am
    wrong, but under less complex programs don't they allow usually
    3 years to determine these standards, 3 years as opposed to 9
    months or 13 months, is that true?
        Ms. Wood. Typically, for state implementation plans, which
    are often called SIPs under the Section 110, the NAAQS Program,
    states do get 3 years.
        Mr. Olson. And this is for you, Mr. Tribe, as well as Ms.
    Wood. In light of the typical period for developing state
    implementation plans under the NAAQS Programs, does EPA's
    accelerated timeline in the Clean Power Plan for submitted
    state plans raise concerns? Constitutional concerns, can you do
    it, yes, no, reliable, whatever?
        Mr. Tribe. Are you asking whether the----
        Mr. Olson. What are your concerns, sir? What raises these
    concerns in all this accelerated development going down from 3
    years to 9 months to 13 months, what----
        Mr. Tribe. Well----
        Mr. Olson [continuing]. Are your concerns? How about----
        Mr. Tribe. Frankly, I don't know that the time change
    raises a big constitutional concern, but if I could, without
    cutting too much into your time, verify----
        Mr. Olson. No, it is your time, sir.
        Mr. Tribe [continuing]. One point which I think is
    absolutely crucial to that little document that you are
    holding, and that is the suggestion that we should defer to EPA
    on which of the 2 versions of this law, are really the law of
    the land. Let me be absolutely clear, it was not some
    functionary, it was the Senate conferees on October 27, 1990,
    who said we recede to the House version. The Senate version
    couldn't be implemented because it was just a clerical thing
    that referred to something that no longer existed. So that is
    absolutely clear. This ghost version of the law that Professor
    Revesz wants to resurrect, and I don't know why he would bother
    if the law as it really is in the books supported what they are
    doing, but I don't have time to go through the grammar to show
    why it doesn't, this ghost version doesn't exist. There may be
    ghosts, but this ghost is a nonexistent one. And now what he is
    saying is that because courts generally defer to agencies like
    EPA, when they take a statute that is ambiguous and interpret
    it one way or another, it should also somehow follow that when
    Congress tosses a law into the air, and there is another ghost
    competing with it, it is OK for the EPA to grab the ghost and
    run with it. What kind of version of the Constitution is he
    reading? Certainly not the one you have in your pocket.
        Mr. Olson. Yes, sir. I mean I am looking through this
    document. It has also the Declaration of Independence and the
    Constitution, 27 amendments, I don't see a ghost version
    anywhere in this document. So that is great insight.
        My final question is for all three witnesses. EPA has
    announced they will finalize this proposed Clean Power Plan for
    existing power plants this summer. Do you expect that will be
    challenged in the courts, and will be that be struck down or
    vacated in your humble opinion?
        Mr. Tribe. Well, it is being challenged already in a
    particular case in the D.C. Circuit, but the problem is that
    that court might not reach the merits. It might say it is
    premature because, after all, we don't have a final rule yet,
    but the real dilemma is that states are confronted with not a
    ghost but a phantom. They are confronted with some federal
    alternative that they can't yet see, and so they are under
    enormous pressure, which is what makes this a violation of the
    Tenth Amendment, under enormous pressure to revise their whole
    economy. And by the time that has happened, it might be too
    late for a court to unwind everything that has gone on. And,
    you know, maybe if that would have solved the whole climate
    problem, one would say, well, what is a little legal violation,
    but when you look at what the EPA itself says, it says that if
    this proposal were perfectly implemented and were not offset by
    what goes on abroad, what it would achieve by the year 2100 is,
    at most, reducing the rise of sea levels by \3/10\ of a
    centimeter, which is two or three sheets of paper, and reducing
    global mean temperature by under 1/100 of 1 degree centigrade.
    And I ask you, even if we could get all of that, is it worth
    that little document you are holding----
        Mr. Olson. Thank you, sir.
        Mr. Tribe [continuing]. And I would say no.
        Mr. Olson. I am out of my time. Thank you for being a
    ghostbuster.
        Mr. Whitfield. Gentleman's time has expired.
        At this time, I will recognize the gentlelady from Florida,
    Ms. Castor, for 5 minutes.
        Ms. Castor. Thank you, Mr. Chairman. And thank you to our
    esteemed panelists today. It has been very insightful.
        Professor Revesz, you have cited the Whitman v. American
    Trucking Association opinion as one of the most important
    environmental decisions overall in the history of the Supreme
    Court, and you say it has particular import for the Clean Power
    Plan. That was a case--who was the author of that case?
        Mr. Revesz. Justice Scalia.
        Ms. Castor. Justice Scalia. The central issue was the
    delegation of authority, whether it was constitutional or
    unconstitutional, is that right?
        Mr. Revesz. That is correct.
        Ms. Castor. So what did Justice Scalia say in that case
    that you think is quite analogous here, and that might be an
    issue----
        Mr. Revesz. Right.
        Ms. Castor [continuing]. In future court cases?
        Mr. Revesz. Right. Thank you. So that was a case in which
    Professor Tribe wrote a Brief, arguing that the Clean Air Act
    was--involved an unconstitutional delegation of legislative
    power to the administrative agency. Justice Scalia was widely
    regarded at the time, and still is, as the greatest friend of
    non-delegation doctrine in the Supreme Court, and Justice
    Scalia writing for unanimous court rejected the non-delegation
    argument. It was rejected unanimously by a vote of 9 to 0. And
    that case is relevant to this situation because that was the
    last time that a broad non-delegation argument was made
    challenging a major environmental provision. It was a provision
    of the----
        Ms. Castor. And that is the Clean Air Act too----
        Mr. Revesz [continuing]. Very same statute.
        Ms. Castor [continuing]. Is that right?
        Mr. Revesz. It is the Clean Air Act as well, the very same
    statute. And Professor Tribe made his argument, just like he is
    making it now, and it was unanimously rejected by the Supreme
    Court.
        If I can take just a moment to say something about ghosts.
    You know, I never knew that laws came in ghost and non-ghost
    versions. I mean they are either laws or they are not laws. If
    they are passed by both chambers and signed by the President,
    they are laws. If they are not passed by both chambers and not
    signed by the President, they are not laws. Here, there was a
    House Amendment and there was a Senate Amendment. Both the
    House Amendment and the Senate Amendment were passed by both
    chambers and they were signed by the President of the United
    States. That makes them a law.
        What the Senate manager said about receding would have been
    really interesting and very important if, in fact, they had
    carried out what they said and withdrawn the language, but the
    language was not withdrawn, it was passed by both bodies and,
    therefore, it became a law. Not a ghost law, a real law. And
    what EPA is asked to do here is not, as Professor Tribe said,
    to pick whether it likes the House Amendment better than the
    Senate Amendment, the question is whether these conflicting
    provisions of the federal statute can be properly reconciled.
    That is the business of an administrative agency, and an agency
    takes a first crack at doing that. EPA is not going to say we
    like the Senate Amendment better, it is going to say we think
    we can give both meaning to both the House Amendment and the
    Senate Amendment. And if they do it appropriately, the courts
    will defer to their interpretation. And if they don't do it
    appropriately, the courts will strike it down. And that issue
    is now being litigated, as Professor Tribe noted, before the
    D.C. Circuit, and it is going to get argued on April 16, but
    certainly, that is the standard tool of statute interpretation.
    That cannot, under any plausible guise, become a constitutional
    problem.
        Ms. Castor. And if it was unconstitutional, what would
    happen to a whole range of environmental protection laws in
    America?
        Mr. Revesz. Well, I mean if a court said that there was an
    unconstitutional delegation here because there was--there were
    separate House and Senate Amendments, and again, this would
    be--it is hard to even imagine how that could be the case,
    given the history of the non-delegation doctrine in this
    country, arguably both provisions would be invalid, and
    arguably we would go back to the preexisting law which would be
    the 111(d) provision that was in the books before 1990, which
    would, I think quite clearly, give EPA the power to do exactly
    what it is doing here.
        So even if this was all right, it is not clear the remedy
    would help opponents of the Clean Power Plan at all.
        Ms. Castor. OK, thank you.
        I yield back my time.
        Mr. Whitfield. The gentlelady yields back.
        At this time, recognize the gentleman from Illinois, Mr.
    Shimkus, for 5 minutes.
        Mr. Shimkus. Thank you for all you smart people for being
    here. This has really be educational and enlightening, and
    unfortunately, it is going to have real consequences.
        So first, I was involved in a Conference Committee, the
    2005 Energy Act, which was done here, open amendment, debated,
    and we don't do Conference Committees very much anymore, and so
    I think that is why there is confusion. So the first question
    is, if one chamber recedes to the other one, then the
    conference report has the language of the amendment that was
    accepted. There is no second amendment, is that true, Mr.--
    Professor Tribe?
        Mr. Tribe. Yes, here----
        Mr. Shimkus. Briefly.
        Mr. Tribe. No.
        Mr. Shimkus. Thank you. Ms. Wood?
        Ms. Wood. No.
        Mr. Shimkus. Professor Revesz, you seem to think there is.
    How can there be two amendments when there--when you vote on a
    conference bill with language that has been given up by the
    Senate?
        Mr. Revesz. Because they both happen to be in the statutes-
    at-large.
        Mr. Shimkus. If--typically, if a chamber withdraws its
    amendment, would you----
        Mr. Revesz. It is not----
        Mr. Shimkus [continuing]. But the chamber did withdraw the
    amendment.
        Mr. Revesz. It did not----
        Mr. Shimkus. Receded to it. Receded to the House language.
        Mr. Revesz. The House manager said----
        Mr. Shimkus. All right.
        Mr. Revesz [continuing]. That they were receding----
        Mr. Shimkus. All right.
        Mr. Revesz [continuing]. But both amendments were passed by
    both chambers, and both amendments were signed by the
    President. That is not the standard situation where a manager--
    --
        Mr. Tribe. But it is standard. Excuse me, I don't mean to
    interrupt. It happens all the time. If Professor Revesz's view
    were accepted, there would be sheer chaos because this kind of
    situation----
        Mr. Shimkus. You would have multiple definitions of the
    language that was supposedly passed by the Legislative Branch.
        Mr. Tribe. Right, and I am not----
        Mr. Shimkus. OK.
        Mr. Tribe. I am not making a delegation argument here at
    all.
        Mr. Shimkus. All right, thank you. I want to go to my
    second question.
        To Ms. Wood, Professor Revesz talked about electricity in
    the interstate commerce and the regulated entity where it is
    really--what is it, you tell me? I think I know what it is but
    you tell me.
        Ms. Wood. The confusion that you are rightfully
    experiencing is because he is convoluting that somehow the
    Clean Air Act regulates the product that is being sold, and
    that is absolutely not the case. What----
        Mr. Shimkus. And the product in this case would be?
        Ms. Wood. The product is electricity.
        Mr. Shimkus. And what should they be doing?
        Ms. Wood. But what is being regulated, and what needs to be
    regulated, is the electric generating unit, the piece of
    equipment that is generating electricity. And in my car
    example, the fact that he car, which is what is the emitting
    source, and the product is the same thing, just happens to be a
    coincidence, but what the Clean Air Act regulates are sources
    of air pollution.
        Mr. Shimkus. Yes, thank you. And I was following up on
    Congressman Olson's discussion on the 9 plus 4 equals 13
    months. Were--how long would judicial review take in a case
    like this? This is to Mrs. Wood--Ms. Wood.
        Ms. Wood. Typically, in the D.C. Circuit you would be
    looking at 1 \1/2\ to 2 years before you would get a decision.
        Mr. Shimkus. So before we have--so that is the problem that
    a lot of us have. OK, there is a constitutional debate and
    conflicting views, I think we have established that, but we are
    going to enforce standards on not just the utilities but the
    ratepayers before this decision gets rendered.
        Ms. Wood. Indeed, and that is a very real problem, and you
    can see a very real-world example of it right now with the
    Mercury and Air Toxics Standards. That case is being argued
    next week before the Supreme Court, and a victory in that case
    is probably going to be hollow for many, many electric
    utilities because they have already installed the pollution
    controls under that rule.
        Mr. Shimkus. And as we have had discussions here, the real-
    world implications are trying to comply financially. The
    difference between the Clean--some of the Clean Air Act and
    sulfur dioxide was that we had technology to do it.
        Ms. Wood. Yes. There were scrubbers that would remove the--
    --
        Mr. Shimkus. We knew the cost----
        Ms. Wood [continuing]. Sulfur dioxide.
        Mr. Shimkus [continuing]. They were--and this committee has
    been clear in our hearings that every process except for
    advanced oil recovery in a small facility in Canada is not
    financially doable, and the government has invested and
    actually pulled out of the FutureGen 2.0 because it is too
    expensive. This government has made a decision they can't do a
    carbon sequestration.
        Ms. Wood. There is another critical difference between this
    and the Acid Rain Program that I think needs to be pointed out.
    The Acid Rain Program was enacted by Congress.
        Mr. Shimkus. Yes.
        Ms. Wood. It was not done in a rulemaking by EPA.
        Mr. Shimkus. Well, thank you. And I will just end on this.
    Mercury thermometers are not dangerous, but breaking the
    thermometers and drinking the mercury might be hazardous to
    your health because I think everyone here, based upon our age,
    probably used mercury thermometers.
        And I yield back.
        Mr. Whitfield. Thank you.
        At this time, recognize the gentleman from Iowa, Mr.
    Loebsack, for 5 minutes.
        Mr. Loebsack. Well, thank you, Mr. Chair.
        I am a former college professor, I have really enjoyed this
    a lot, but I am not a constitutional law scholar. I did
    comparative politics and international politics, but I really
    do appreciate the back-and-forth and all the rest, but
    eventually we are going to have to make some decisions here as
    a legislative body. There is no question about that.
        Just one quick note. This isn't new in terms of the EPA
    taking it upon itself, if you will, or trying to implement some
    kind of legislation. I understand the arguments just how far
    they are going, whether they are going too far or not. As you
    all know, long ago, you know, Ted Lowey talked about how, you
    know, regulatory agencies often go much further than Congress
    ever intended them to go, and we are going to continue the
    debate whether the EPA is going too far or not. There is no
    question about that.
        In the meantime, I would--and, Professor Tribe, if you
    would refrain from responding unless I ask you to do so.
    Professor Revesz, would you like to respond to Professor Tribe
    and his response to you on the 2 amendments issue? Just take a
    minute, if you would.
        Mr. Revesz. Yes. I think as I have already said, you know,
    it is often the case there are conflicting House and Senate
    versions of bills and in conference, the conference decides to
    go with one of the versions. That is the version that is then
    voted on by both chambers, signed by the President, and becomes
    law. That is the standard way that conferences work.
        Mr. Loebsack. Yes.
        Mr. Revesz. Here, that is not what happened. It wasn't that
    there were conflicting House and Senate versions, and the
    conferees chose the House version. The House version then
    became the bill that was voted on by both chambers and signed
    by the President. That is not what happened. What happened was
    that both the House version and the Senate version made it into
    the bills that were voted by both Houses, they made it into the
    statutes-at-large, they were signed by the President, and they
    are both duly enacted laws of the United States.
        Mr. Loebsack. All right, thank you, Professor Revesz.
        Professor Tribe, what is the legal way to address these
    problems? In your testimony, you mentioned a legal way to
    address these problems. What are we talking about when you say
    the legal way, and what are some examples of that?
        Mr. Tribe. It seems to me that an act of Congress, or a
    series of congressional enactments, is the only legal way.
        Mr. Loebsack. Yes.
        Mr. Tribe. I mean Congress has the power, did have the
    power to pass for the United States what California has done
    within California, a cap and trade plan, but it didn't succeed.
        Mr. Loebsack. Yes.
        Mr. Tribe. Congress could fund alternative energy sources,
    put a huge amount of emphasis, as the government already is
    doing to some extent, on solar, on wind, on geothermal, but it
    really would take an act of Congress. It is just not enough for
    an agency to do it on its own. And here, even if there were, as
    Professor Revesz thinks, two laws that Congress did pass,
    assume he is right for the moment and--because both of them
    made it into the statutes-at-large, an agency would have to
    reconcile them, as he says, but you can follow both at one,
    that is, each of them precludes the EPA from regulating certain
    things. The Senate version focused on the pollutant, the House
    version focused on the source. You could obey both. There is no
    need to choose between them, and choosing between them is not
    an exercise of delegated power.
        Mr. Loebsack. And you are someone who recognizes the
    importance of climate change, the reality of climate change,
    you said, and you have the----
        Mr. Tribe. No, I think----
        Mr. Loebsack. And you have been environmental----
        Mr. Tribe [continuing]. Me personally----
        Mr. Loebsack [continuing]. Very environmentally-minded over
    the years. If you could, you mentioned cap and trade, are there
    other kinds of things that Congress could do?
        Mr. Tribe. Well, you know, if I were just to be very
    imaginative, and I am only speaking for myself here, not for
    anybody else.
        Mr. Loebsack. That is what I am asking you to do, right.
        Mr. Tribe. A lot of people think that the best solution is
    to pay countries not to do so much deforestation----
        Mr. Loebsack. Yes.
        Mr. Tribe [continuing]. And that would take an expenditure
    of money. It is not the standard thing that comes to mind, it
    is way beyond the fence, but I think if Congress were able, I
    hate to say this, to get its act together, if Congress really
    could act effectively, there are a lot of things it could do.
        Mr. Loebsack. Yes.
        Mr. Tribe. Now, there is a problem. A lot of my friends
    tell me, look, don't be an idealist, don't be utopian. Congress
    isn't going to do anything so why are you so hot about the EPA
    violating the law and the Constitution? Well, it is just, I
    guess, the way I was brought up. I think the law and the
    Constitution matter.
        Mr. Loebsack. Yes, Professor Revesz?
        Mr. Revesz. Could I--yes. So under the Clean Air Act,
    Congress made a decision in 1970 not to define some limited
    number of pollutants that could be regulated, because Congress
    understood that as science evolved, other pollutants would
    become serious. And, therefore, the Clean Air Act uses a term
    air pollutant. Typically, air pollutant, dangerous to human
    health or welfare. EPA was basically required by the Supreme
    Court, in Massachusetts v. EPA, to acknowledge that greenhouse
    gases were air pollutants, subject to regulation under the
    Clean Air Act. This is not some power grab by this
    Administration, this has been now a process that has been going
    on for almost 10 years, and the Supreme Court said yes, when
    Congress said air pollutants, it meant something pretty broad.
    It is a broad definition, and greenhouse gases are air
    pollutants. And then EPA was asked to determine whether
    greenhouse gases endangered public health, and actually, the
    Bush EPA administrator made the initial endangerment
    determination. It didn't become effective at the end of the
    Bush Administration, and then this Administration made it
    again. And so now greenhouse gases are air pollutants, endanger
    public health, and that puts them at the core of what the Clean
    Air Act is designed to deal with.
        Mr. Loebsack. Thanks to all of you.
        Thanks, Mr. Chair.
        Mr. Whitfield. Gentleman's time has expired.
        At this time, recognize the gentleman from Ohio, Mr. Latta,
    for 5 minutes.
        Mr. Latta. Well, thank you, Mr. Chairman. And thank you
    very much for our witnesses today. We appreciate your
    testimony, and it is very informative.
        If I could start, Professor Tribe, last year the Supreme
    Court cautioned the EPA against interpreting the Clean Air Act
    in a way that would bring about an enormous and transformative
    expansion of the EPA's regulatory authority without clear
    congressional authorization. In your opinion, does the proposed
    Clean Power Plan comply with this directive?
        Mr. Tribe. I think that what the court said in the case
    that you are quoting, which was Utility Air Regulatory Group v.
    EPA, would apply many times over to this plan, and in
    particular, in that very case the court addressed the point
    that Professor Revesz just made. Yes, air pollutant in the
    dictionary definition part of the Clean Air Act is a very broad
    term, and it does encompass greenhouse gases, but when the
    court, in Mass v. EPA, in 2007, found a specific provision for
    regulating greenhouse gases in connection with tailpipe
    emissions, what UARG, the decision last year, said is you can't
    rewrite clear statutory terms to extrapolate from the fact that
    something which is a greenhouse gas for purposes of a
    particular regulatory context can, therefore, be regulated
    under a different statutory provision which, it is very clear,
    prohibits the regulation under 111(d) of greenhouse gases or
    any other air pollutant from a source that has already been
    forced to spend a lot of money under 112 in order to meet the
    requirements of 112 with respect to the 188 hazardous air
    pollutants.
        Mr. Latta. Well, OK. Professor Tribe, also then, the Clean
    Air Act places limits on the EPA's authority to use the Section
    111(d) to regulate existing sources that are already subject to
    regulation for hazardous air emissions under Section 112. Does
    this prohibit the EPA from regulating coal-fired utilities
    under Section 111(d)?
        Mr. Tribe. From regulating? I am sorry, I didn't hear you--
    --
        Mr. Latta. From regulating coal-fired utilities----
        Mr. Tribe. Under 111(d).
        Mr. Latta [continuing]. Under 111(d).
        Mr. Tribe. It certainly prohibits them as long as those
    utilities are being regulated under 112 for the hazardous
    pollutants. Greenhouses gases cannot be regulated under 111.
        Mr. Latta. Well, with that then, especially from the
    testimony I have been hearing this morning, should the EPA's
    interpretation of these statutory provisions be entitled to
    deference by the courts, and if not, why not?
        Mr. Tribe. Well, two reasons. First of all, what it is
    doing is not interpretation, it is revision. It is picking a
    statute that Congress did not enact, and that is not something
    to which the courts would ever defer. Secondly, the principle
    of deference under a case called Chevron only kicks in where
    there is an ambiguity, and here there isn't an ambiguity. And
    besides, deference is trumped by a principle called
    constitutional avoidance, that is, the Supreme Court has said,
    and the D.C. Circuit has said, that when an ambiguous statute,
    and I maintain this is not ambiguous, would cause
    constitutional problems if you defer to the agency's
    interpretation of it, then you don't defer, so that even if
    deference were otherwise available, here it would be trumped by
    the serious constitutional problems that I have outlined,
    haven't had time to talk about in detail, but my statement in
    written form explains why, for example, even though the
    property is not being totally destroyed, this is a violation of
    the Fifth Amendment, and explains a number of other things. So
    given those constitutional problems, which I don't think have
    been solved----
        Mr. Latta. Well, and----
        Mr. Tribe [continuing]. Deference----
        Mr. Latta [continuing]. If I can just follow up with one
    question here because I am short on time. The Clean Air Act as
    a whole, and Section 111(d) in particular, are based on
    principles of cooperative federalism and are designed to give
    states autonomy and flexibility, and implementing emission
    control programs does the proposed rule strike an appropriate
    balance between the EPA and the states?
        Mr. Tribe. Well, I think that the EPA is not striking a
    constitutionally appropriate balance. It is basically saying,
    yes, you have some choice to meet this severe limit, but it is
    like saying your money or your life, and you can choose whether
    to pay me in cash or by check or by Bitcoin, that is, there is
    no power to command the states to do any of this stuff. And
    saying that, well, this is just optional, it is like
    cooperative federalism, completely confuses what happens
    normally under the Clean Air Act with what is happening here.
    Normally, the national goal is set and the Federal Government
    works with the states to find a way to implement it locally.
    That is not what is going on here. What is going on here is
    radically different.
        Mr. Latta. Thank you.
        Mr. Chairman, my time has expired.
        Mr. Whitfield. Gentleman's time has expired.
        At this time I will recognize the gentleman from Texas, Mr.
    Green, for 5 minutes.
        Mr. Green. Thank you, Mr. Chairman, and ranking member for
    holding the hearing. I want to thank both our panels of
    witnesses to be here today.
        I know there is some disagreements about the EPA Clean
    Power Plan, but as a lawyer, I am always interested in hearing
    the arguments from our professors. Besides this hearing, the
    EPA Clean Power Plan has been subject to a lot of debate.
    Whether EPA has the authority to regulate power plants was
    ultimately decided by the courts, and it is this issue I find
    most disappointing. I have been in Congress for some time, and
    I would like to see a solution on our climate issues offered by
    this body, and not necessary because of the Supreme Court
    ruling. We should work together and control carbon emissions.
    That doesn't mean eliminating traditional fuels, and it
    certainly doesn't mean dismantling the EPA. It means a
    reasonable approach from a legislative body that would reach
    required compromise, and that is what we have been sent here to
    do, and I look forward to both panels.
        Professor Tribe, your testimony, a portion that jumped out
    at me is on page 11 where you say it makes far more sense to
    address climate change by legislation. I couldn't agree with
    you more, but without congressional action, the federal
    agencies are acting under the existing authority given by the
    Supreme Court. Professor Tribe, in your testimony on page 14,
    you address EPA's reference to the Chevron USA case. It is my
    understanding Chevron created a two-part test to determine
    regulatory authority. There are many attorneys in Washington
    and D.C. and around the country making large sums of money
    advising clients on which version of the House or Senate
    Amendment the Clean Air Act are law. If the Supreme Court
    agrees to hear this case, is it your argument that Congress
    spoke directly to the question at issue, or do you believe the
    court will rule on the agency's interpretation?
        Mr. Tribe. Well, I don't think the court would accept the
    agency's interpretation. I think here the statute is too clear,
    and the court in the UARG case made as clear as it could
    possibly have made it that the fact that greenhouse gases may
    be a terrible problem doesn't give a blank check to any agency
    to rewrite the law.
        Mr. Green. OK.
        Mr. Revesz. If I can just for a minute--in that case, EPA
    was trying to regulate 86 percent of the carbon dioxide
    emissions of certain stationary sources. The court in that case
    allowed EPA to regulate 83 percent of those emissions. Justice
    Scalia indicates that in his opinion. It only deprived the EPA
    of the authority to regulate the last 3 percent, and that was
    because that statute had a specific numerical provision that
    would have required EPA to either regulate a much larger number
    of sources than EPA wanted to do, or else disregard the number.
    And as a result of that problem, the Supreme Court deprived EPA
    of the authority to regulate the last 3 percent of those
    emissions, but allowed EPA to regulate 83 percent of the
    emissions of these stationary sources.
        So EPA ended up getting most of what it sought--the vast
    majority of what it sought out of that case, and the statutory
    problem that arose was a very specific statutory problem under
    that particular provision that has no bearing on other
    provisions that don't have those numerical limits.
        Mr. Green. Professor Revesz, one of the other things, since
    I only have a minute and a half, would a strict reading of the
    House version exclude many if not all potential regulated
    sources, and you have written extensively on environmental law
    and regulatory policy, is Congress, while we don't interpret
    the law, it is our job and the courts to do that, we have the
    responsibility for conflicting issues in the laws that we
    wrote. Do you agree with that?
        Mr. Revesz. Absolutely. And it often happens. This isn't an
    example of Congress doing something wrong. I mean it often is
    the case that statutes get passed and they have ambiguous
    provisions that require agency interpretation. This is the
    bread and butter of what the federal courts then to do is to
    determine whether the agency interpretations are entitled to
    deference, and whether they should be upheld.
        Mr. Green. And that is the federal court's job. Let me give
    you an example of one of the legislation that we have worked on
    passing. Congressman Olson and Congressman Mike Doyle and I
    have introduced legislation, and it has actually passed the
    House, to resolve conflicting language in the Federal Power
    Act, and that is our job to be able to do that, to do the
    legislating if there is an issue that the courts may not be
    addressing in our opinion is what the law is.
        Professor Tribe, I am sorry, I don't give you any more than
    10 seconds, but----
        Mr. Tribe. Well, I agree with that allocation of
    responsibility. I also think that measuring the law by
    percentages is not exactly right. I saw those talking points
    too----
        Mr. Green. Yes.
        Mr. Tribe [continuing]. The EPA wanted to win, and they
    said why don't you point out we won 83 rather than 86. That
    wasn't the point. The point was that their approach to the law
    was totally rejected by the court.
        Mr. Green. OK.
        Mr. Revesz. No, there were two issues. EPA won on one issue
    and lost on one issue. It was not totally rejected by the
    court.
        Mr. Whitfield. Gentleman's time has expired.
        Mr. Green. Thank you, Mr. Chairman.
        Mr. Whitfield. At this time, I will recognize the gentleman
    from West Virginia, Mr. McKinley, for 5 minutes.
        Mr. McKinley. Thank you, Mr. Chairman. And thank you to the
    panel for being here. It is always enlightening to hear some of
    these discussions. I know ultimately the decision is going to
    be made by the courts, but it helps us to understand a little
    bit of these issues, particularly between 112 and 111(d), but I
    don't think the American public gives a hoot. They really
    don't. They just want to make sure that Johnny has a job, and
    their electric rates are going to be reasonable for them to be
    able to continue. And I see us getting caught up. We start
    chasing these rabbits, that they get us distracted from where
    we need to be.
        I will be the first to tell you that I--do I think climate
    change is occurring? Absolutely. I think it is. But we have
    taken this simplistic route to go this direction, and so what I
    want to do is get back more to the fundamental. You all were
    chasing this rabbit all the way down. You are arguing over 112
    and 111(d), and you are talking about phantoms and ghosts, I
    think. Don't care. What are we going to do? What are we doing
    here with this fight? I would like to get back to the more
    basic where we are, because under the United Nations it said
    that 96 percent of the CO2 emissions are naturally
    occurring. Only 4 percent of all the CO2 emissions
    of the world are anthropogenic, manmade. See, I can use the
    term like you all. Only 4 percent. And the United Nations goes
    on to say that all coal-fired powerhouses in America, if you
    shut off every one of them shut down in America, under the
    United Nations, said you only reduce the CO2
    emissions by \2/10\ of 1 percent. That is not my statistic,
    that is from the United Nations, \2/10\ of 1 percent.
        So what I am doing, I am the engineer in the room here on
    this. So now we are getting to the point, under this rule, they
    want to reduce it 30 percent, so we are talking about a rule
    that reduces 30 percent of \2/10\ of 1 percent. We are talking
    about a reduction of CO2 emissions in the globe of
    \6/100\ of 1 percent. Forget the argument over 112 or 111(d),
    we are going to spend billions of dollars, we are going to
    raise rates, jobs are going to be lost--to save \6/100\ of 1
    percent of the CO2 emissions. That doesn't make
    logical sense. From an engineering perspective, there is
    something wrong when we start chasing a rabbit over here, when
    we are putting our economy at risk over \6/100\ of 1 percent.
        Professor, could you respond to that? Are we chasing the
    right rabbit here?
        Mr. Tribe. Well, my grandchildren ask a similar question,
    which shows how wise you are, because I think my grandchildren
    are smart as whips. Grandpa, why are you worried about this 111
    and 112 stuff? Is the world going to be destroyed? And then I
    tell them, well, there is this agency and it says if you do
    what it wants, they are not going to save the world, in fact,
    maybe by the year 2100, they will prevent the oceans from
    rising as much as, well, two sheets of your paper. But they
    think that by making a start, it is good, better than nothing.
    Well, your grandpa spends his life teaching about the
    Constitution, and so I sort of put that in the balance. There
    are a lot of details there, they look like rabbits going into
    rabbit holes, but that matters because in the long run, all
    those rabbits add up to something that this country has built.
    And then they ask a different question. They say, well, if we
    make a start, isn't that good? And then I try to give them the
    old proverb, you can't leap across a chasm in two steps, you
    know. Jumping halfway or even 1 percent of the way might do a
    lot more harm, like splat on the bottom of the chasm, than not
    doing this at all and looking for something else. What would
    you do, Grandpa? And then I say I am not an expert in that
    stuff.
        Mr. McKinley. Ms. Wood?
        Ms. Wood. I wanted just to expand for a second on what
    Professor Tribe was saying about needing to make a start and
    wanting to build on something. I think it is important to
    recognize here that if these sources are not regulated under
    Section 111(d), they are regulated under Section 112, and that
    is what is prohibiting the 111(d). Under 112, these sources
    have to put on maximum available control technology, maximum.
    So it is not as though these sources are not going to be
    controlled. And more importantly, in terms of when you start
    talking about carbon dioxide, I think it is also important to
    note that EPA has said that the carbon benefits from that
    maximum available control technology are estimated to be $360
    million annually. So it is not as though there isn't a start
    being made.
        Mr. McKinley. Right. And my time has run out, but I would
    rather us be focusing on something more practical than this
    ideological--why aren't we doing energy efficiency, why aren't
    we looking at more research into clean coal technology, but to
    simply go after it and start doing this and costing us jobs I
    think is incredibly naive.
        Thank you, and I yield back.
        Mr. Whitfield. Gentleman's time has expired.
        At this time, recognize the gentleman from Kentucky, Mr.
    Yarmuth, for 5 minutes.
        Mr. Yarmuth. Thank you very much, Mr. Chairman. Thanks to
    the witnesses.
        After listening to this discussion, I am not sure I am
    happy or sad that I dropped out of law school years ago. I
    think I am happy. But I want to go back to--you mentioned the
    Massachusetts v. EPA case, and I--what we were debating the
    Waxman-Markey bill several years ago, 2009, and so forth. That
    was kind of the motivating factor, I think, for many of us at
    that point, that if the Supreme Court had said that we have to
    regulate carbon dioxide, wouldn't it be better for Congress to
    act and create a mechanism for dealing with it than trusting
    the EPA to be flexible enough to deal with states like my own,
    and Congressman McKinley's as well. So I am curious because I
    have heard some difference of opinion, and I don't want to
    start another debate, on whether that decision actually
    mandated, made it compulsory for EPA to regulate CO2
    or just basically made it permissive. You are shaking your
    head, Ms. Wood, do you want to answer that?
        Mr. Revesz. Well----
        Mr. Yarmuth. Or either one.
        Mr. Revesz. Yes, that decision held that--EPA in that case
    was arguing that greenhouse gases were not air pollutants for
    the purposes of Section 202 of the Clean Air Act. The Supreme
    Court held that they were, in fact, air pollutants for the
    purposes of Section 202 of the Clean Air Act. It did not
    mandate regulation because regulation is mandated only if the
    air pollutants endanger public health or welfare. So the next
    step was for EPA to make the determination, the court did not
    make it as was appropriate, to make the determination whether
    greenhouse gases endanger public health and welfare, which is a
    statutory term. As I indicated earlier, Stephen Johnson, who
    was the EPA Administrator at the end of the Bush
    Administration, made that endangerment finding, but the
    Administration ran out of time. It wasn't approved during the
    Bush Administration, and it was, therefore, made anew by the
    Obama Administration. And that was challenged in the D.C.
    Circuit. Many groups challenged the endangerment finding and
    said that that was--and the agency had acted inappropriately in
    making that finding. The D.C. Circuit upheld the agency's
    decision. Those same groups then petitioned the court for
    certiorari, and the court, while granting cert on other issues
    in that case, and that ended up being the Utility Air
    Regulatory Group case, denied certiorari on the endangerment
    finding.
        So now it basically is the law, or at least the agency has
    said that greenhouse gas emissions endanger public health. And
    now Massachusetts v. EPA dealt with Section 202 of the Clean
    Air Act. The definition of air pollutant and of harming public
    health is very similar across many sections of the Clean Air
    Act and, therefore, that case has now led to all these other
    rules. These rules are basically based on exactly the same
    legal principle. And EPA is proceeding accordingly with the
    Supreme Court----
        Mr. Yarmuth. They are doing their job as they see it, based
    on what the Supreme Court said----
        Mr. Revesz. Right.
        Mr. Yarmuth [continuing]. About CO2.
        Mr. Revesz. What the Supreme Court said in Mass v. EPA,
    that greenhouse gases are air pollutants. Well, the D.C.
    Circuit said, in the case that became UARG in the Supreme
    Court, is the endanger public health, and then----
        Mr. Yarmuth. In fact, there has been a considerable amount
    of at least scientific evidence that there is a connection
    between CO2 and elevated levels of asthma and so
    forth in communities. I know that is true in my community as
    well.
        I want to get to a question real quick with Ms. Wood. In
    your issue about whether or not we regulate the product or go
    outside the fence, or so forth, if under a state's plan, the
    state utilities, power companies, offered financial incentives
    for conservation to its customers, would that fit within your
    conclusion of being something that would be consistent with
    your interpretation of what EPA can regulate, even though in
    this case it would be voluntary, the states would be doing it,
    not EPA, but EPA would have to approve the plan?
        Ms. Wood. I think the key difference here----
        Mr. Yarmuth. Yes.
        Ms. Wood [continuing]. Is in how the targets are set versus
    the flexibility that you could use to meet that target. And I
    think this is a key distinction that needs to be made. And the
    issue isn't whether a power company could do what you are
    saying to meet the target, the question is should those types
    of things be considered in determining what the target is. And
    to that, my answer is no, the Clean Air Act doesn't permit
    that. 111 has always been understood to begin and end at the
    source.
        Now, in the Clean Air Mercury Rule that EPA did several
    years ago, they did have flexible cap and trade mechanism to
    meet that limit, but the target itself and the limit itself was
    based on technology that could be applied at every unit. So you
    started with activated carbon injection, and you figured out
    what the rate would be at each unit, but then you allowed
    flexibility in terms of how you would meet that.
        So in your example, I think that would be permissible in
    terms of meeting the target, but it would not be permissible
    for setting the target.
        Mr. Yarmuth. OK, appreciate that.
        I yield back. Thank you, Mr. Chairman.
        Mr. Whitfield. Gentleman yields back.
        At this time, recognize the gentleman from Virginia, Mr.
    Griffith, for 5 minutes.
        Mr. Griffith. Thank you, Mr. Chairman. Appreciate you
    having this hearing very much.
        I rarely disagree with my colleague from West Virginia, but
    in this case I do. The process and the procedures by which we
    get our laws and pass our laws may not always make sense and be
    practical in the minds of some, but it is what has allowed our
    republic to exist for the length of time it has, over 200-and--
    I guess we are closing in on 220-some-plus years, and it is
    extremely important.
        Professor Revesz, I love these things, and I am going to go
    down a different rabbit hole than the one we have been going
    over, although I am coming back to that one because I love that
    one too. The proposal that you make is a parliamentary
    procedure impossibility. It cannot happen. Doesn't matter what
    the issue is. Jefferson is very clear in the Manual of
    Parliamentary Practice. When there are differences between the
    two Houses, they get together in a conference and they work
    those differences out. If both Houses adhere to their position,
    the bill itself dies. It is not for you to say today that the
    bill should die if there is some confusion because there are
    two different versions. There are not two different versions,
    there is one version. It could not have passed out of both
    Houses, gone through a Conference Committee, and gotten to the
    President's desk unless there was one version, and one version
    exclusively.
        And then we get to the point that Professor Tribe made, and
    it is an honor for me to be in your presence. We are not always
    going to agree. There are a lot of things we are going to
    disagree on politically, but your defense of the Constitution I
    am 100 percent behind and----
        Mr. Tribe. Thank you.
        Mr. Griffith [continuing]. Agree. And even when the rules
    in the Constitution are against me on what I believe ought to
    happen, I respect that those bodies and those rulings must be
    followed.
        And so we get to that because I think that if there was
    some kind of a disagreement and suddenly it is found 25, 30
    years later, that creates a problem, and I would submit--I
    don't know about the 1995 ruling. I would ask you quickly if
    you could tell me about that. You said that it had already been
    determined in '95, '08, and '11, and I know '08 and '11.
        Mr. Tribe. Right. Well, in 1995, the EPA itself interpreted
    the Section 111(d) as I have, and as I think the courts would.
        Mr. Griffith. OK. And then we get to 2008, and you didn't
    make this point, although I am sure you are aware of it, and I
    find this language fascinating and brought this up to the EPA
    months ago. That decision, if you read it, part of it says this
    requires vacation of CAMR's regulations for both new and
    existing EGUs, electric generation units.
        Mr. Tribe. Yes.
        Mr. Griffith. EPA promulgated the CAMR regulations for
    existing EGUs under Section 111(d). This is a court opinion by
    the Circuit Court in D.C. This is what I am saying here. For
    existing EGUs under Section 111(d). But under EPA's own
    interpretation of the section, it cannot be used to regulate
    sources listed under 112.
        Mr. Tribe. Right.
        Mr. Griffith. The judge found that they had conceded, and
    he goes on to say, EPA thus concedes that if EGUs remain listed
    under Section 112 as we hold, then the CAMR regulations for
    existing sources must fail. The EPA appealed that ruling, but
    not on that point.
        Now, what is significant about that, and the question I
    have for you, and I am going back to first year of law school
    for myself, is the EPA now precluded, under either the theory
    of res judicata or collateral estoppel, having conceded the
    point in the 2008 case and not appeal to the Supreme Court, and
    having been a party in that case, albeit not a party in the
    2011 case----
        Mr. Tribe. So----
        Mr. Griffith [continuing]. Have they conceded the point,
    and are they now thrown out on their backsides because they
    have already conceded this point, and to bring it back up is a
    waste of time, as Mr. McKinley said?
        Mr. Tribe. I think, because that case was New Jersey v.
    EPA, it is only New Jersey that could make that collateral
    estoppel argument. Other people confronted by an EPA that says
    we have now changed our minds, like Robert Jackson once said,
    the matter does not appear to me now as it appears to have
    appeared to me then, other people are not going to be able to
    estop the EPA. But the EPA is free to make these arguments, I
    just think they are wrong and will lose.
        Mr. Griffith. All right. And you think they will lose also
    in looking at 2011, although they were not a party to that, you
    were correct in referencing footnote 7 that said that the
    Supreme Court specifically said in their opinion, previously
    cited approvingly by Professor Revesz, that there is an
    exception, EPA may not employ 7411(d), which is what we are
    talking about, if existing statutory sources of the pollutant
    in question are regulated under the National Ambient Air
    Quality Standard program, 7408 through 7410, or the Hazardous
    Air Pollutants Program, 7412, which is what we are talking
    about is 111 and 112, am I not correct?
        Mr. Tribe. Correct, and that use of the word or supports
    the court's reading. The courts have been consistent in
    accepting this reading all this time, and it is amazing, though
    it is not illegal as such, for the EPA to scratch its head and
    say how are we going to win this case, we have to invent a new
    statute.
        Mr. Griffith. And they have reached pretty deep to find
    something that they could hang their hat on.
        Mr. Tribe. They reached very deep, to something that
    Senator Durenberger when it was first proposed said I can't
    imagine this being used very often. It has only been used 5
    times. It is a technical little--well, it is a mouse hole, and
    they are pulling an elephant out of it.
        Mr. Griffith. Thank you. I have to yield back. I wish I had
    more time.
        Mr. Whitfield. Gentleman yields back. Thank you.
        At this time, recognize the gentleman from Maryland, Mr.
    Sarbanes, for 5 minutes.
        Mr. Sarbanes. Thank you, Mr. Chairman. And thanks to the
    panel.
        I don't know that I have a whole lot to add or more to ask,
    but we have talked about phantoms and we have talked about
    ghosts, and we are now getting to a dead horse in terms of
    beating it over this issue of the interpretation. I gather that
    the crux of this is whether the EPA's pursuit of the Clean
    Power Plan is warranted or authorized under Section 111(d), and
    that then sets to this question of whether it is seeking to
    balance and interpret the conflict between these two amendments
    is appropriate or not appropriate.
        Because you all have been debating this most of the time we
    have been here, I am assuming that while there are other parts
    of your argument, and briefs, that you point to, that you view
    that as probably being the issue upon which a court's review of
    this question is going to turn. Is that fair?
        Mr. Tribe. Well, I have tried to encapsulate the essence of
    it, but what I submitted is over a 50-page document, and I do
    think courts will pay attention to the several different parts
    of the argument. One, that even if Congress did give this power
    to the EPA, it would violate basic principles of federalism,
    and that is one reason that a court would not interpret
    Congress' having done so. Two, that there are powerful issues
    about the statute itself, and the EPA's authority to go beyond
    a statute. And three, separation of powers issues that arise
    out of the EPA's recognition that because the statute as
    written doesn't quite do what they want to do, they have
    created a magical mystery tour through the parliamentary
    procedure to say, well, there are two statutes. And although I
    have suggested, both here and in my written testimony, that if
    there really were two, which doesn't happen, they could follow
    them both by both outlawing the regulation of pollutants that
    are covered by 112, and outlawing the regulation under 111(d)
    of sources under 112.
        Mr. Sarbanes. Professor Revesz, do you----
        Mr. Revesz. Yes, if I can answer your question more
    directly. The debate we have been having here is replicated in
    hundreds of pages of briefs before the D.C. Circuit. All of
    these issues are being aired in great detail on both sides.
    Most of the positions that I have made here are made by the
    U.S. Department of Justice, by many states. Other states are
    taking the opposite position. Some industry groups are agreeing
    with my interpretation of the Constitution of the statue, other
    industry groups are on the other side. All of this, there are
    hundreds and hundreds of pages of briefs on all of the issues
    we have been talking about.
        If I can just take a moment to respond to an issue that Mr.
    Griffith raised. There is clearly only one version of the
    statute. There has to be only one version. That one version
    includes arguably inconsistent provisions. They are arguably
    consistent, and arguably inconsistent, but they were both voted
    on by both chambers and signed by the President. And the CAMR
    case is different because in the CAMR case, the problem was
    that EPA had initially sought to regulate mercury emissions
    under Section 112, then in Bush Administration decided to
    regulate under 111(d), but it was trying to regulate the same
    mercury emissions, the same hazardous air pollutant. Everyone
    concedes that EPA cannot invoke Section 111(d) to regulate a
    hazardous air pollutant that is being regulated under Section
    112. But here the issue is the greenhouse gases are not
    hazardous air pollutants regulated under Section 112, so the
    CAMR case is actually an opposite to this problem, but I am
    sorry, I took up a little bit of your time.
        Mr. Sarbanes. No, actually, I was going to ask you to add
    whatever you think is left on this question. Can you real
    briefly, in 43 seconds, just give me a little bit more of your
    perspective on why the Takings issue is not determinative here?
        Mr. Revesz. Well, because first, this is a regulation, it
    is not a physical Takings, so a regulation would have to
    deprive a property owner of almost all of the value of the
    property. And if there is a property owner for whom that is the
    case, the proper remedy is not to invalidate this regulation,
    but it is for that property owner to sue separately at a later
    time for compensation.
        Mr. Sarbanes. Thank you.
        Mr. Tribe. Could I----
        Mr. Sarbanes. Sure, Professor Tribe. You have----
        Mr. Tribe [continuing]. Add one word?
        Mr. Sarbanes [continuing]. One more second.
        Mr. Tribe. We have never suggested striking down the law.
    Compensation is all we have talked about, but ever since The
    Steel Seizure Case, the Supreme Court has said that an agency,
    and even the President is not allowed to impose a bill on the
    American taxpayers for compensation unless Congress, which has
    the power of the purse, has clearly authorized the action that
    is going to require the compensation. That is all we have been
    talking about under that part of our----
        Mr. Revesz. But there is no compensation required here.
        And one last point. On footnote 7, as we have now, I think,
    indicated, footnote 7 is subject to interpretations, and there
    are literally dozens of pages in the D.C. Circuit briefs on
    either side of that issue. I think it is pretty clear what
    footnote 7 means. Obviously, Professor Tribe thinks is it clear
    on the other side, but there are two interpretations of
    footnote 7 of the American Electric Power case that are out
    there.
        Mr. Whitfield. Thank you. Gentleman's time has expired.
        At this time, recognize the gentleman from Missouri, Mr.
    Long, for 5 minutes.
        Mr. Long. Thank you, Mr. Chairman. And thank you all for
    being here today.
        When we started this hearing, I didn't have this document
    in my hand. And I represent the Seventh District in Missouri,
    which is Springfield, Joplin, Branson, Missouri, and we have a
    lot of successful businesses that germinated there. Bass Pro
    Shops started from nothing and has become what it is today.
    O'Reilly Automotive, which is across the United States, very
    successful company. We have a great medical community there, a
    lot of successful businesses, and a lot of people that just
    want to raise their kids in a good part of the country. Have a
    good job, raise their kids, have a nice place to raise their
    family. And I saw in my notes today, my little handy-dandy
    pocket card here, that the city of Springfield was coming to
    see me today, and I thought that is great. They think enough of
    me to come and talk to me about some issues that they have
    pressing. I am glad they came to Washington to see me, but they
    didn't come to Washington to see me, they came for a
    conference. And the reason they came to this conference, there
    were two cities of the United States that were invited to the
    conference to speak on this. One was Richmond, Virginia, and
    the other was Springfield, Missouri. And the reason is they
    have done such a good job, such a forward-thinking job with
    these different issues that we are discussing here today.
        I want to read you just a little snippet of what we have,
    and then kind of ask you all's suggestion on something. But
    this is from Mayor Bob Stephens, Mayor of Springfield,
    Missouri. Affordability and unfunded environmental mandates.
    And like I say, you can think what you want about things, but I
    stepped off in a side room here and got this in our meeting, I
    couldn't run back to my office and meet him over there, so I
    was required to meet him here due to time constraints.
    Affordability and unfunded environmental mandates. As you know,
    the city of Springfield, Greene County, and Springfield City
    Utilities have been working cooperatively to develop a proposed
    integrated plan framework that would foster a more holistic
    approach to the various unfunded EPA environmental mandates
    that all communities are facing; wastewater, storm water,
    drinking water, air quality, and solid waste. Our integrated
    plan framework attempts to consider all of these issues
    together instead of each one separately, and to focus resources
    where the community can achieve the biggest bang for the buck.
    We appreciate your efforts to ensure that future unfunded
    environmental mandates must be affordable for the community and
    the citizens.
        Now, one of the things that they did in this report that
    they are in here in Washington, and were honored enough to be
    thought of highly enough for the conference to be one of two
    cities, is they did the math. I know you all are constitutional
    scholars and such, but I don't know how your math is, but the
    math that they did was over the next 15 to 20 years, these
    unfunded mandates from the Environmental Protection Agency are
    only going to cost each individual in my district a little over
    $46,000 per person over the next 15 to 20 years.
        So I guess I will start here with Professor, is it Revesz?
    Do you have any suggestions what I tell the folks back home
    about these?
        Mr. Revesz. Well, it is a little hard for me to comment on
    a document that I haven't seen, but I can tell you from my
    experience, one of my areas of expertise is a cost benefit
    analysis of environmental regulation, and I actually care a lot
    about having the benefits of environmental regulation exceed
    the cost, and I am a big proponent of the use of cost benefit
    analysis to justify environmental regulation, which sets me
    apart from actually the vast majority of environmental law
    professors in this country who don't like it as much as I do.
    But I can tell you that often, these early cost estimates turn
    out not to be accurate, and----
        Mr. Long. They are usually low, aren't they?
        Mr. Revesz. No, actually, empirical studies show that
    initial cost estimates tend to be higher than the ultimate
    costs are, and there is a good reason for that. As initial
    estimates are generally made on the basis of sort of current
    end-of-the-pipe technology, but there is a great ingenuity in
    American business, and businesses figure out ways of doing
    things more effectively and more cheaply, and for that reason,
    in the end, costs end up being lower than are predicted.
        There is a lot of debate on cost estimates. There is huge
    variance, and each of those estimates should be submitted to
    serious peer review by serious experts, and I would take well-
    conducted cost estimates very seriously. But----
        Mr. Long. So we----
        Mr. Revesz [continuing]. I would caution----
        Mr. Long. I hate to interrupt you but I am about out of
    time, but Johnny Morris, the owner of Bass Pro Shops, has a
    saying, we all live downstream. We all do live downstream. We
    want to have a clean environment to raise our family, and
    whether it is in the Ozarks or Washington, D.C., or the state
    of Washington, we all want a good clean environment, but unless
    you own Bass Pro Shops or you own O'Reilly Automotive, or one
    of these businesses, and our median income is under the $46,000
    a year, it is pretty tough to explain to the folks back home
    that you have to put a cup in the storm waters that pass
    through Springfield, and dip it and make it palatable, and some
    of these ridiculous regulations.
        I think I am over my time. I was going to yield my time
    back but I don't have any, Mr. Chairman. Thank you.
        Mr. Whitfield. The gentleman yields back.
        At this time, recognize the gentleman from New York, Mr.
    Tonko, for 5 minutes.
        Mr. Tonko. Thank you, Mr. Chair. And welcome to our
    panelists.
        Since 1970, the Clean Air Act has had several key features
    that have helped make it one of the most successful
    environmental laws in the world. Science-based, health-
    protective standards keep our eye on the prize: healthy air for
    everyone. Cooperative federalism allows EPA to set the clean
    air goals, and allows states to decide how best to achieve
    them. EPA retains backstop enforcement authority, ensuring that
    every citizen in the United States receives a minimum level of
    protection, even if their state fails to act. Some have claimed
    that this arrangement violates the Tenth Amendment, and I
    quote, ``If a state fails to formulate a plan, EPA will mandate
    a federal plan. This commandeering violates the Constitution
    under New York v. U.S.''
        Professor Revesz, does the Clean Air Act state plan/federal
    plan provisions violate the Constitution?
        Mr. Revesz. It does not, and the reason is that states are
    not required to do anything. States are given the option to
    come up with state implementation plans, and if they don't, EPA
    can impose federal implementation plans on the sources of
    pollution. And because EPA imposes those directly on the
    pollution sources and not on state institutions, there is no
    Tenth Amendment problem.
        The cooperative federalism arrangement under Section
    111(d), as I indicated earlier, is exactly the same arrangement
    that has been in place since 1970 for meeting the national
    Ambient Air Quality Standards. EPA sets the reduction
    requirements in the National Ambient Air Quality Standards to
    define the maximum permissible concentration of pollution in
    the ambient air. The states can then decide how to allocate
    that reduction requirement among their sources through state
    implementation plans. And generally, they do, but sometimes
    they don't. And when they don't, EPA imposes federal
    implementation plans. And this system has been going on for
    decades. So the reason there isn't a Tenth Amendment problem is
    because EPA does not actually require the states to do these
    state implementation plans, it merely gives them the option to
    do them. And 111(d) is exactly the same situation. Through
    its--the Clean Power Plan--the proposed rule in the Clean Power
    Plan, EPA has set a reduction requirement that applies to each
    state. Each state can now decide what to do. Each state is not
    forced in any way to do what EPA has suggested they do in the
    regulation. They can do whatever they want as long as they meet
    the reduction requirement. And if they choose not to do
    anything, and some states have said they won't, EPA can then
    impose a federal implementation plan. And the fact that some
    states have already said that they will not do it shows that
    there is no compulsion.
        Mr. Tonko. Professor, would it be fair to say that ``the
    existence of a backup federal plan takes the Clean Air Act
    outside the commandeering world,'' just as the Supreme Court
    said in the radiation case of New York v. U.S.?
        Mr. Revesz. Yes, that is exactly right. And the New York
    case was problematic because there, the federal statute was
    requiring states to either take title to certain waste or adopt
    certain regulations----
        Mr. Tonko. Well, I----
        Mr. Revesz [continuing]. Which is not the case here.
        Mr. Tonko. Thank you. And I ask about these two statements
    because they were both made by Professor Tribe, and I sensed a
    bit of conflict there. Do you see any conflict between the two
    statements?
        Mr. Revesz. Well, there certainly is conflict between the
    two statements you mentioned now and Professor Tribe's position
    in his written submissions and in his testimony today.
        Mr. Tonko. Thank you. And Professor Revesz, we are all
    hearing about these legal questions, about the EPA's ability to
    regulate greenhouse gases emitted from power plants. As you
    know, power plants are the largest source of uncontrolled
    CO2 emissions in the U.S. I am not an attorney, but
    I thought the overall question of whether EPA had the authority
    under the Clean Air Act to regulate greenhouse gases was
    considered by the Supreme Court. I believe there were three
    separate cases: Massachusetts v. EPA; American Electric Power
    v. EPA; and Utility Air Regulatory Group v. EPA, and that the
    court ruled in favor of EPA regulation of greenhouse gases. In
    fact, the court in the Utility Air Regulatory Group case,
    talking about EPA regulation of power plants said that ``the
    Act speaks directly to emissions of carbon dioxide from the
    defendant's plants.'' So I just thought we should remember that
    and put it all in context. And any comments that you have in
    response----
        Mr. Revesz. No, I----
        Mr. Tonko [continuing]. To those cases?
        Mr. Revesz. I totally agree, in the Utility Air Regulatory
    Group case that was decided last year, one of the issues was
    whether best available control technology could include the
    regulation of greenhouse gases, and the Supreme Court held that
    it could, and the reason that it could is because greenhouse
    gases were regulated air pollutants that endanger public health
    and welfare.
        Mr. Tonko. Thank you very much.
        With that, I see my time is up and I yield back.
        Mr. Whitfield. Gentleman's time has expired.
        I know that Mr. Tribe was trying to respond. Did you want
    to make a comment?
        Mr. Tribe. Right. I don't know whether you call it a point
    of personal privilege or whatever, but since I was quoted, the
    context was a statement I made in October of 2012. I was
    talking about something that bears no resemblance to the plan
    that was announced, proposed by the EPA on September 2014. I
    may have some ability to foresee the future, but not that much.
        It is true that the existence of an otherwise unproblematic
    backup plan can take something out of the normal commandeering
    world, but here we have something that is much more like what
    the U.S. Supreme Court decided in NFIB v. Sebelius, was
    impermissible pressure on the states because preexisting help
    that the states are getting from the Federal Government to deal
    with air pollution, in places like Springfield, can be yanked
    when the state is recalcitrant and does not succumb to the
    Federal Government's demand that it meet certain goals.
        In addition, the backup plan here, the reason I called it a
    phantom earlier is something that Professor Revesz said at page
    13 of his prepared statement, he says it remains to be seen
    what a backstop federal implementation plan will look like.
    Now, what kind of alternative is it to tell a state either
    achieve these goals, and you can do it in any of several ways
    but none of them are voluntary, or we will do something to you
    and we won't tell you quite what?
        Mr. Whitfield. OK.
        Mr. Tribe. It is not just putting a bullet to their head,
    it is making them play Russian roulette.
        Mr. Whitfield. Thank you, Mr. Tribe.
        Mr. Revesz. If I could----
        Mr. Whitfield. You want a personal privilege, Professor?
        Mr. Revesz. Yes, I would like that. That is the way that
    the Clean Air Act has worked for 45 years. Under the National
    Ambient Air Quality Standards, EPA can set state limitation
    plans. If they don't, the Federal Government can impose a
    federal implementation plan. The Federal Government does not
    say upfront what that federal implementation plan would look
    like----
        Mr. Whitfield. Well----
        Mr. Revesz [continuing]. It waits until the states either
    submit a state implementation plan or not. Here, EPA is
    actually doing something it has never done before, which is
    favorable to the states. It has said we are going to give you
    early guidance and we are going to do it sometime in the next
    few months so you actually have some information, which is a
    lot more information than states have had under the kind of
    bread and butter of the Clean Air Act for the last 45 years.
        Mr. Whitfield. And we have another panel coming up after
    you all that will be getting into this also.
        At this time, I would like to recognize the gentlelady from
    North Carolina, Mrs. Ellmers, for 5 minutes.
        Mrs. Ellmers. Thank you, Mr. Chairman. And thank you to our
    panelists for being here today on this subject.
        I would like to, you know, focus in, you know, we are
    talking about our states, and in North Carolina, North Carolina
    is going to be negatively impacted by the increased utility
    bills. I know we have already discussed whether or not that
    will take place over time, but as it plays out I do believe
    that will be the case, and obviously, this interpretation of
    Section 111(d) of the Clean Air Act.
        With that, I would like to ask Professor Tribe and Ms.
    Wood, the EPA maintains that the rule is very flexible. How
    would you describe the rule in just a few words, because I know
    we have kind of gone over this subject a bit, and I have a very
    particular question I would like to ask all of you in the
    remainder of my time?
        Mr. Tribe. Well, I would say that the flexibility is an
    illusion. In fact, the Attorney General of Michigan, in
    comments filed with the EPA in November of last year, warned
    that the plan really takes meaningful freedom away from the
    states----
        Mrs. Ellmers. Yes.
        Mr. Tribe [continuing]. And has just a patina----
        Mrs. Ellmers. Yes.
        Mr. Tribe [continuing]. Of flexibility.
        Mrs. Ellmers. Yes.
        Mr. Tribe. It is like the example I gave, your money or
    your life, but you can pay----
        Mrs. Ellmers. But you can pay----
        Mr. Tribe [continuing]. By cash or by check.
        Mrs. Ellmers [continuing]. You can choose any vehicle as
    long as you choose a black one, that kind of thing.
        Mr. Tribe. Right. Very much like that.
        Mrs. Ellmers. Ms. Wood, and to that one, do you feel it is
    flexible, but then also as a Clean Air Act practitioner, how
    would North Carolina or any other state be able to actually
    implement this rule?
        Ms. Wood. Yes. The flexibility is exactly as Professor
    Tribe described it, it is illusory, and the example I like to
    use in describing the flexibility is it is as if I came to you,
    the State of North Carolina, and I said I want you to give me
    change for a dollar. You can do it any way you want. It can be
    100 pennies, it can be four quarters, I don't care, you just do
    it, North Carolina, the way you want. Well, the problem is
    North Carolina only has 60 cents, and so there really isn't
    flexibility there.
        Mrs. Ellmers. Right. So in other words, with the--got it.
        Now, to that point, I want to go into something very
    specific because I think, there again, I know we have been
    debating law and the interpretation. I am a nurse and I am much
    more practical when it comes to these things. So what I would
    like to know is, based on this 111(d) provision, in building
    block number four, which is relating to the increased energy
    efficiency, how would this be enforced?
        And I will start with you, Professor Tribe, and then just
    go to each one of you.
        Mr. Tribe. I would rather defer, if I could, because she
    is----
        Mrs. Ellmers. That is fine. That is fine. Ms. Wood.
        Mr. Tribe. She is more of an expert in the intricacies than
    I am.
        Mrs. Ellmers. OK.
        Mr. Wood. That gets to the essence of the problem of this
    rule which is that it goes beyond the source, as I have talked
    about today. There is no mechanism in the Clean Air Act for you
    to go and require people to reduce their electric consumption.
        Mrs. Ellmers. And basically, what we are talking about here
    is we are not talking about the state now or penalizing the
    state, we are talking about individuals. We are talking about
    individual households, we are talking about individuals who may
    or may not be complying with these regulations.
        Ms. Wood. Exactly. So either you are going to hold the
    individuals directly responsible, which isn't permissible under
    the Clean Air Act, or you are somehow going to try to force the
    electric utility companies to make----
        Mrs. Ellmers. To----
        Ms. Wood [continuing]. Their customers do it.
        Mrs. Ellmers [continuing]. Enforce. Correct.
        Professor Revesz, would you like to comment on this?
        Mr. Revesz. Sure. As I indicated earlier, I mean the
    product here, what is being regulated is electricity delivered
    in usable form to consumers.
        Mrs. Ellmers. To consumers.
        Mr. Revesz. Consumers. Now, I don't think EPA is arguing
    that consumers should use less electricity, or take the bus one
    day a week or work at home, or anything like that.
        Ms. Wood. That is absolutely building block four.
        Mrs. Ellmers. To the point.
        Mr. Revesz. That is an interpretation of building block
    four, and we can disagree with that but I don't think we will
    resolve it in the next 52 seconds.
        Also, we shouldn't lose sight of the fact that nothing is
    being imposed on any state here.
        Mrs. Ellmers. OK, but there again, now----
        Mr. Revesz. These are very----
        Mrs. Ellmers [continuing]. Now I am just reclaiming my
    time. We have already determined it is not the state we are
    talking about. We are talking about the individuals are the
    users of this energy, the individuals. My question is how would
    you enforce this?
        Mr. Revesz. States in their plans can come up with
    reductions any way they choose. They don't have to do anything
    in particular. They can have trading schemes, they can enter
    into compacts with other states and have multistate schemes,
    they have a million different options in how they can do this.
    They don't have to do it this way.
        Mrs. Ellmers. But building block number four talks about
    the individual use.
        Mr. Revesz. The building blocks are used to determine the
    state reduction requirements. They are not imposing any
    requirement on any state or on anyone else, they are just a way
    of determining to what extent states can reduce their carbon
    dioxide emissions.
        Mrs. Ellmers. Thank you.
        And I yield back the remainder of my time.
        Mr. Whitfield. Gentlelady yields back.
        At this time, I recognize the gentleman from Texas, Mr.
    Flores, for 5 minutes.
        Mr. Flores. Thank you, Mr. Chairman. And I want to thank
    the panel for joining us today. This has been a fascinating
    discussion, particularly with respect to government overreach.
        Professor Tribe, the question of Takings has come up in the
    course of this conversation today. Professor Revesz, a few
    minutes ago, indicated that it wasn't a problem, but you
    indicate that the rule's impact raises Fifth Amendment or
    Takings concerns. Can you tell us what you mean by that, can
    you expand?
        Mr. Tribe. What I mean I think is best illustrated by
    decisions that involve not only the Takings and Compensation
    Clauses, but the Due Process Clause. As the Supreme Court has
    held in a number of cases, including one where the EPA
    initially promised confidential treatment to pesticide makers
    and then pulled the rug out from under them, and another in
    which the United States Government offered companies more
    favorable accounting treatment if they would bail out failing S
    and Ls, and then reneged, in cases like that, the Supreme Court
    has found a doctrinal basis either in the Contract Clause or in
    the Due Process Clause or in the Takings Clause for saying that
    even though you haven't wiped somebody off the map entirely,
    you have left them with some value, if you lead them to take a
    course of action and then pull the rug out from under them,
    fairness requires some kind of compensation. And in particular,
    the way the coal companies have been led on here is well known,
    this was something that was encouraged by the government, and
    in particular, when they were forced to invest billions of
    dollars in meeting the requirements under 112 with respect to
    the hazardous pollutants, they were pouring money down a hole,
    and they were not told, guess what, it is all gone, because the
    state that you live in has no choice other than to put you out
    of business.
        Mr. Flores. Well, that sort of brings me to my next
    question related to 111(d). This seems to be on shaky legal
    ground already. It is already the subject of lawsuits that
    haven't been finalized yet.
        And so, Ms. Wood, what happens if the states start
    implementing the final rule only to have the courts strike the
    rule down, and what do these states do, what if they have
    already started signing the contracts, people started breaking
    ground on investments, or making capital commitments for
    investments, what happens next?
        Ms. Wood. Yes. There are two sets of harm that can happen
    here; one is to the states and the other is to the power
    plants----
        Mr. Flores. Correct.
        Ms. Wood [continuing]. Themselves. And when you are looking
    at the states, they are having to start now to prepare these
    plans. In the litigation that is pending, the state of Alabama,
    for example, submitted an Affidavit that said that this was by
    far the most complex undertaking that the state of Alabama
    Environment Department had undertaken in 40 years. So it is a
    lot of capital being expended to come up with these plans.
        Most states are going to need to enact legislation and put
    in place regulations. So if at the end of that time period,
    this is all found to be unlawful, well, all of that effort will
    have been lost, but more importantly to the extent legislation
    and regulations have been put in place, all of that is going to
    have to be reversed, and, you know, that is also going to be
    time-consuming. And then as you said, power plants need to
    start planning now and so they can enter into contracts and
    could have financial----
        Mr. Flores. Right, but it goes unsaid here but is obvious
    is that the consumers and the taxpayers and ratepayers all bear
    the cost to that.
        Continuing on Section 111(d), it is the basis for the Clean
    Power Plan that the EPA has come up with, but this provision as
    I understand it has seldom been used in EPA's 44-year history.
    The Supreme Court also recently said it is skeptical when an
    agency claims to discover in a long, long exigent statute, an
    unheralded power to regulate a significant portion of the U.S.
    economy.
        And so, Ms. Wood, another question for you. Isn't it
    correct that in the 1990 amendments to the Clean Air Act, only
    one section of 111(d) regulation has been promulgated that
    still exists?
        Ms. Wood. Yes, that is correct. As Professor Tribe has
    talked about, there was one version of Section 111(d) that was
    actually promulgated. It is the House version, it is what is
    shown right now in the United States Code, and it precludes
    regulation of source categories under 111(d) if they are
    already regulated under 112.
        Mr. Flores. Well, and that was sort of my next question, as
    these have always had very limited reach.
        Ms. Wood. Yes, very limited reach. It really was designed
    by Congress to be a catch-all for something that slipped
    through the cracks. These sources are not slipping through the
    cracks, they are being regulated under 112 and having to
    install maximum achievable control technologies.
        Mr. Flores. Right. So there has never been an expansive use
    of 111(d) like this that we are proposing.
        So, Professor Tribe, would you like to comment?
        Mr. Tribe. I agree.
        Mr. Flores. And you have 2 seconds.
        Mr. Tribe. It has only been used for four pollutants and
    five sources. They are very specialized and localized, like
    municipal waste landfills or sulfuric acid plants, which give
    off acid mist, and the idea that it is nothing new, just
    business as usual is the most fantastic account I have heard.
        Mr. Flores. OK. Thank you very much. I yield back.
        Mr. Whitfield. Gentleman yields back.
        At this time, recognize the gentleman from Mississippi, Mr.
    Harper, for 5 minutes.
        Mr. Harper. Thank you, Mr. Chairman. And thanks to each of
    you for being here. You have been very informative, and it is a
    challenging issue to every one of our states, a very expensive
    issue and proposition that is here. And the discussion on the
    Constitution is certainly very intriguing. And yesterday I saw
    in the vault at National Archives the original handwritten
    letter that Thomas Jefferson wrote following the Louisiana
    Purchase, congratulating Congress on this new acquisition,
    which had not been approved yet. And him being a strict
    constructionist, he was obviously concerned about people
    calling it unconstitutional, and he said it was extra-
    constitutional. So, it is amazing how we have progressed in 200
    years, and how we look at things.
        But, Professor Tribe, EPA and proponents of this regulatory
    approach say Section 111(d) serves as a catch-all that provides
    regulatory authority to ensure there are no gaps in air
    pollutant regulations. And I know we have touched on it, but
    what are your thoughts about this gap-filling argument?
        Mr. Tribe. Well, it is the job of Congress to fill gaps in
    the law, and it tried to fill the little cracks, as Ms. Wood
    suggested, not in a huge gap, when it passed 111(d); little
    things that just weren't covered because they were not among
    the 188 hazardous pollutants that are regulated under 112 at
    the source. But the idea that when an agency is not satisfied
    with the coverage of a law, it can sort of squeeze the law so
    that the hole in the legal ozone layer is sort of closed up is
    just totally fantastic.
        Mr. Harper. Well, Professor Tribe, following that line,
    have you identified any evidence that Congress intended to
    provide EPA powers to expand its own regulatory authority when
    EPA identifies the need to do so, and how would that be
    possible under the Constitution?
        Mr. Tribe. Well, I think it wouldn't be possible, and I
    have found no such evidence.
        Mr. Harper. OK, thank you.
        Ms. Wood, I think everybody agrees that EPA has the
    authority under certain circumstances to set standards that
    people comply with by installing certain equipment, for
    example, catalytic converters have been added to cars to meet
    environmental regulations. How is EPA's proposed 111(d) rule
    different than that?
        Ms. Wood. Yes. Well, it is different in the ways that I
    have discussed, which is it is going beyond the source of
    pollution, and the bulk of the reductions that EPA is claiming
    from this rule are not actually coming from the source, they
    are coming from other areas.
        This is the first time in its history that EPA has ever
    tried to apply any part of 111 in this manner. Rather than
    being a standard of performance, in other words saying how a
    source should perform and at what rate it should emit, it is
    really a standard of nonperformance. Let us try to figure out
    ways where these plants don't have to run. It is completely
    backwards and upside-down. Nothing has ever been done like
    this, and in fact, if you think about it, if you are looking
    for the best system of emission reduction, which is what EPA
    does, not running it or shutting it down would always be best,
    and yet that is never what they have found before.
        Mr. Harper. Thank you very much.
        Thank you, Mr. Chairman. I yield back the balance of my
    time.
        Mr. Whitfield. The gentleman yields back.
        And that concludes our questions, and I want to thank the
    three of you for taking time to be with us and discuss this
    very important issue with a lot of profound impacts down the
    road. So, Professor Tribe, thank you. Ms. Wood, Professor
    Revesz, thank you. We look forward to continuing to work with
    you on this issue and others.
        And with that, we will release the first panel.
        Mr. Tribe. Thank you, Mr. Chairman.
        Ms. Wood. Thank you, Mr. Chairman.
        Mr. Whitfield. Thank you so much. Thank you.
        And I would like to call up the second panel now, who have
    been very patient. And on this panel, we are going to really
    zero-in on the practical impacts at the state level, and what
    their thoughts are about this proposed rule.
        And we have four witnesses: Mr. Craig Butler, Ms. Kelly
    Speakes-Backman, Mr. Art Graham, and Mr. Donald van der Vaart.
    So if you all would take your seats. And just like the first
    panel, I will introduce each one of you right before you give
    your opening statement. I do think it is important that
    everybody understand that today is Mr. Art Graham's birthday,
    so he is a fun-loving guy and that is why he is here today--to
    celebrate his birthday.
        But our first witness is Mr. Craig Butler, who is the
    Director of the Ohio Environmental Protection Agency. Mr.
    Butler, thank you for being with us, and you are recognized for
    5 minutes for a statement. And at the end of that time, we will
    have questions for you.

       STATEMENTS OF CRAIG BUTLER, DIRECTOR, OHIO ENVIRONMENTAL
        PROTECTION AGENCY; KELLY SPEAKES-BACKMAN, COMMISSIONER,
        MARYLAND PUBLIC SERVICE COMMISSION, AND CHAIR, BOARD OF
       DIRECTORS, REGIONAL GREENHOUSE GAS INITIATIVE, INC.; ART
    GRAHAM, CHAIRMAN, FLORIDA PUBLIC SERVICE COMMISSION; AND DONALD
        VAN DER VAART, SECRETARY, NORTH CAROLINA DEPARTMENT OF
                   ENVIRONMENT AND NATURAL RESOURCES

                       STATEMENT OF CRAIG BUTLER

        Mr. Butler. Good morning, Mr. Chairman, Chairman Whitfield,
    members of the committee. I do appreciate the opportunity to
    testify before the subcommittee.
        My name is Craig Butler. I am director of the Ohio
    Environmental Protection Agency, and I have been asked to
    provide testimony on Ohio's comments and interpretation of the
    Clean Power Plan.
        As reflected in our detailed comments, and extensive
    comments to U.S. EPA, the proposal seeks to overhaul the
    Nation's power generation, transmission, distribution systems,
    by reducing coal-based electricity, and instituting federally-
    mandated reliance on energy efficiency, renewable energy under
    the guise of global climate protection.
        It is no secret, as we have heard today, that many states
    including Ohio, that the Clean Power Plan is encumbered with
    significant legal problems and should not go forward. While I
    am not here and won't discuss those concerns in detail, be
    assured that Ohio will continue to pursue these challenges
    either independently or joining with other states to prevent
    the likely illegal rulemaking from moving ahead.
        U.S. EPA's request for comment on more than over 500
    different aspects of the proposed rule as it was published in
    the Federal Register, combined with the inability to answer
    basic questions throughout that comment period, clearly
    highlights that the plan has not been well designed and was
    rushed out the door to meet a predetermined schedule.
    Nonetheless, Ohio felt a strong obligation to dissect the
    proposed rule from a very technical standpoint. We took it very
    seriously. We partnered with our Public Utilities Commission of
    Ohio, and conducted an extensive outreach effort to interested
    parties during the comment preparation. Our detailed review
    produced more than 180 pages of technical comments.
        One major flaw is how U.S. EPA inexplicably ignores
    efficiency improvements already made to our coal-fired power
    plants, and instead orders sweeping new changes or
    improvements, regardless of feasibility. For example, U.S. EPA
    plan requires an achievement of 4 percent or 6 percent
    efficiency improvement at all coal plants. We know this was
    established without any site-specific assessment in Ohio. In
    reality, Ohio's coal fleet will have recognized a 5.4 percent
    heat rate improvement between 1997 and 2016, and as a result of
    additional reductions, may be very costly or if not impossible.
    In fact, carbon emissions will be reduced by 47 percent between
    2005 and early 2016 from our power plants, yet U.S. EPA's
    allocation allocates no credit in the Clean Power Plan for pre-
    2012 ``early adopters'' of energy efficiency improvements,
    increasing cost to achieve new state regulatory targets and
    threatening more closures of coal plants in Ohio.
        Ironically, after coal-fired units are required to make new
    costly upgrades, their ability to recover the costs in the
    marketplace is minimized by utilization restrictions as a
    result of the remaining EPA building blocks requiring natural
    gas plants to achieve a 70 percent utilization rate. It is
    nonsensical to force costly upgrades on one hand, and only deny
    the same units the ability to run and pay for them.
        In another example, we believe U.S. EPA has misapplied the
    economic feasibility analysis to predict the reliability on the
    bulk power system. It is not clear if U.S. EPA may have
    consulted with the Department of Energy, North American
    Electric Reliability Corporation, Federal Energy Regulatory
    Commission, or power providers to identify and use well-known
    technical modeling software to specifically design to analyze
    how changes in the transmission will be affected. However,
    these organizations currently responsible for maintaining the
    grid and stability and reliability have warned of outages and
    voltage collapse if the plan is implemented as proposed. To
    Ohio, this signals that U.S. EPA failed to consult these
    organizations in a meaningful way while formulating this plan,
    and does not fully understand the implications of the plan.
        As Ohioans discuss this issue across the state, we hear one
    overriding concern: maintaining our affordable, reliable power
    is critical to both the pocketbooks of Ohioans and continued
    economic development within our state. Ohio has been a
    manufacturing hub in the heart of this country since the
    Industrial Revolution. Fueled by electricity, which remains 9
    percent below the national average, Ohio is home to a broad
    range of energy-intensive industries, and is competitive on the
    national and global market. The Clean Power Plan, with all its
    legal and technical flaws, presents a direct threat to these
    benefits to the Ohio consumer.
        One stunning statistic I will share with you is the Public
    Utilities Commission conducted the detailed analysis of the
    Clean Power Plan and indicates that 39 percent higher
    electricity rates in calendar year '25 that will cost Ohioans
    $2.5 billion. In the last 4 years, Governor Kasich has
    supported an energy policy that is inclusive of all sources in
    generation. From our world-class energy summit in 2011, where
    we discussed developing a broad portfolio of the cost-effective
    sources, to recent legislative activity to include combined
    heat and cogeneration in our qualifying energy sources, we have
    and will continue to embrace the often overused but certainly
    relevant all-of-the-above strategy. We do it because it is
    important to affordable, reliable energy and to protect the
    environment.
        I will close by saying Ohio is willing and is very prepared
    to participate in a full national debate on carbon, the need or
    not, frankly, to regulate carbon emissions from power plants,
    and how Ohio is and remains committed to being a good steward
    of the environment. However, the Clean Power Plan is a
    seriously flawed proposal and should not be used to set
    unprecedented national policy. U.S. EPA should reconsider this
    misguided approach.
        Thank you.
        [The prepared statement of Mr. Butler follows:]
        [GRAPHICS NOT AVAILABLE IN TIFF FORMAT]

        Mr. Whitfield. Thank you, Mr. Butler.
        And our next witness is Ms. Kelly Speakes-Backman, who is
    the Commissioner at the Maryland Public Service Commission, and
    Chair of the Regional Greenhouse Gas Initiative. Thank you for
    being with us, and you are recognized for 5 minutes.

                   STATEMENT OF KELLY SPEAKES-BACKMAN

        Ms. Speakes-Backman. Mr. Chair and members of the
    committee, thank you very much for inviting me----
        Mr. Whitfield. Your microphone is on, and move it up closer
    please.
        Ms. Speakes-Backman. Thanks. I think it is with this chair.
        Thank you very much for inviting me to testify this
    morning. I am grateful for this opportunity to comment on the
    proposal's costs, feasibility, and impact on consumers and
    electrics reliability.
        As an economic regulator first and foremost, my primary
    objective is to ensure that the environmental goals of my state
    are realized in the most cost-effective way possible, while
    maintaining grid reliability. To this end, I am pleased that
    the EPA has allowed states to work within the current construct
    of our electric grid markets by encouraging a regional approach
    to compliance. As one of the nine states participating in RGGI,
    the experience of my state as well as recent analyses completed
    by several independent grid operators indicates that a regional
    path to compliance is the most efficient and cost-effective
    path forward.
        Together, our nine states continue to successfully
    implement the Nation's first fully-operational carbon market.
    The RGGI program caps emissions by first determining a regional
    budget of carbon dioxide allowances, then distributing a
    majority of the CO2 allowances through regional
    auctions, so that states may capture the allowance value for
    reinvestment in strategic energy programs.
        Our nine states represent 16 percent of the U.S. economy,
    and generate a total gross domestic product of $2.4 trillion
    U.S. The states work together within the current electricity
    markets to create a unified system for auctioning and trading
    carbon allowances so that our environmental goals are achieved
    through a least-cost, market-based solution. Although we have
    collaborated effectively for the better part of a decade, the
    RGGI region remains diverse in many aspects. We comprise three
    separate regional transmission organizations, we have different
    political landscapes, and dissimilar generation profiles. For
    example, in Maryland, our generation remains predominantly
    coal. As part of RGGI, and coupled with other state energy
    initiatives, however, we have been able to diversify our fuel
    mix and reduce our carbon footprint. Since 2005, in-state
    generation from renewables, nuclear, and natural gas as a
    percentage of total generation mix has increased from 36
    percent to 55 percent, while in-state generation from coal has
    decreased 56 percent to 44 percent. Over our entire RGGI
    region, the power sector carbon pollution has decreased by 40
    percent, while our regional economy has grown by 8 percent.
    That is from 2005 to 2013. Non-hydro renewable generations has
    increased by 47 percent, while our regional dependency on coal
    and oil has decreased. Our carbon intensity of the power sector
    has decreased at twice the rate of the rest of the country.
        So we believe that market forces, state policies, and
    programs, such as RGGI, are driving these cost-effective
    pollution reductions, while simultaneously supporting our local
    economies. Our energy efficiency, demand response, and
    renewable initiatives, as well as policies to encourage fuel
    switching and to less carbon-intensive fuels, all work in
    tandem to reduce pollution and establish long-term solutions
    for a reliable energy infrastructure. Many of the complementary
    strategic energy initiatives are funded using proceeds from
    these RGGI allowance auctions, creating a virtuous cycle of
    benefits that also serves to minimize ratepayer impact.
        I could go through the rest of my written statement, but I
    would very much prefer to just leave you with five points that
    we have learned as part of RGGI, and I would be happy to take
    questions afterwards. The five lessons that we have learned and
    what we hope will be helpful to other states as they are
    crafting their plans, either state or regional, include the
    formation of--one of the lessons stems from the formation of
    our intra and interstate agency relationships as part of the
    regional cooperative effort. These relationships and resources
    have spilled over into other initiatives such as distributed
    generation, electric vehicles, and compliance with other EPA
    and state environmental regulations. Two is the pooling of
    staff resources and budgets. Basically, we can do a lot more
    with a lot less. We have been able to complete the necessary
    regional electric sector modeling in a timely fashion with
    built-in peer review. The third is a regional mechanism
    stimulates active and productive stakeholder engagement. The
    fourth, regional consistency does not require the states to
    implement identical programs. We in Maryland have one way of
    using these proceeds. Those in New York, those in
    Massachusetts, those in the other states participating in RGGI
    base their investments on their own state policies and
    priorities. And fifth, lastly and the most important lesson
    that we have learned by the RGGI states as it applies to the
    Clean Power Plan, is that participation in a regional
    compliance effort will likely provide other states with the
    most flexibility moving forward. Initial hurdles surrounding
    the structure of the mechanism are not, in fact, insurmountable
    as demonstrated by us and in the RGGI states. Using this
    regional construct, the regional emission cap is the only
    enforceable mechanism included in the compliance plan. States
    retain jurisdiction over their own energy efficiency and
    renewable energy programs, and can continue to offer these
    initiatives as complimentary measures that help mitigate the
    cost of compliance for their ratepayers.
        Thank you very much for your time this morning.
        [The prepared statement of Ms. Speakes-Backman follows:]
        [GRAPHICS NOT AVAILABLE IN TIFF FORMAT]

        Mr. Whitfield. Thank you.
        Our next witness is Mr. Art Graham, who is chairman of the
    Florida Public Service Commission. Mr. Graham, thanks for being
    with us, and you are recognized for 5 minutes. And happy
    birthday, as I said earlier.

                        STATEMENT OF ART GRAHAM

        Mr. Graham. Thank you, Mr. Chairman. Thank you for the
    birthday wishes. And thank you and the subcommittee for
    allowing me the opportunity to come and speak today.
        My testimony is my perspective as a utility regulator. I
    believe the EPA's Clean Power Plan, the CPP, threatens the
    affordability and reliability of Florida's electric power. I am
    going to get straight to what I feel is the most troubling
    aspect of the CPP. That would be both the fairness and the
    cost.
        In Florida, we have below-average CO2 emissions
    because of the following. We shifted a lot of our generations
    to low-emission natural gas early on. We offered incentives to
    harvest the available heat rate improvements over the past 30
    years, and through energy efficiency programs that have already
    reduced consumption by 9,330 gigawatt hours. Now, all these
    things allowed us to realize a 25 percent decrease in
    CO2 emissions from 2005 to 2012, but yet none of
    these things are recognized by the current plan. However, in
    the current plan 34 states have higher CO2 emission
    rates than Florida, but only 15 states have higher reduction
    percentage required by the CPP.
        The second concern I want to express this morning is the
    cost of compliance. EPA's responsibility is economic
    protection, which is very important. I think it is very
    important. But my responsibility is protecting the consumer
    from excessive costs and the reliability of the power grid,
    which I think is equally as important. The costs of
    implementing the CPP aren't certain at this early stage, but
    the utility customers will certainly pay for EPA's dramatic
    shift away from economic planning and least cost operation. How
    much is not exactly known, but the cost analysis I will talk to
    you about this morning from our Florida Office of Public
    Counsel, and you will get some idea from there.
        OPC's job is to represent the utility customers' interest.
    They took a very conservative approach and applied EPA's own
    cost assumptions. The specifics are in my written testimony
    that I submitted earlier.
        So briefly, under building block one, applying the
    approximate midpoint of EPA's cost range to achieve
    approximately 6 percent improvement, Public Counsel identified
    a cost of $1.15 billion. Under building block two, Public
    Counsel's conservative methodology precluded costs associated
    with this building block, but the issues were as follows.
    Codifying costs for the EPA's overstatement of gas plant
    capacity, the cost for required new gas transportation
    infrastructure, i.e., pipelines, the cost for replacing
    generating units into retirement long before the end of their
    useful life, i.e., the stranded costs. I can tell you these are
    all big-ticketed items. Under building block three, using a
    U.S. Energy Information Agency's most recent costs for utility
    scale solar, replacing 10 percent of the conventional capacity
    would cost Florida $16.8 billion. Under building block four,
    for Florida EPA's 10 percent reduction equals 5,745 megawatts
    of avoided capacity. Our demand site program costs $1.48
    million per megawatt of avoided capacity. So EPA's assumption
    will cost us over $8.5 billion.
        Now, Florida's Office of Public Counsel limited itself to
    costs that can be cleanly calculated, applying EPA's numbers
    with the most basic government data. Counting only the most
    obvious and easily qualified costs, the expense to Florida
    ratepayers start at almost $27 billion. That works out to about
    $2,800 per utility customer. However, the complete cost is
    much, much higher.
        In short, if EPA wants to reduce the carbon emission by 30
    percent from the 2005 levels, well, then let us use the 2005
    levels as our baseline. It makes no sense that EPA won't
    recognize what states have done since 2005. It is unfair to
    punish early efforts with bigger and more expensive
    requirements.
        And I have some more, but I don't want to run over.
        [The prepared statement of Mr. Graham follows:]
        [GRAPHICS NOT AVAILABLE IN TIFF FORMAT]

        Mr. Whitfield. OK, Mr. Graham, thank you very much, and we
    will have an opportunity to ask questions as well, and then we
    have your full statement for the record.
        At this time, I would like to introduce Donald van der
    Vaart, who is the Secretary for North Carolina Department of
    Environment and Natural Resources. Thanks very much for being
    with us, and you are recognized for 5 minutes.

                   STATEMENT OF DONALD VAN DER VAART

        Mr. van der Vaart. Thank you. Chairman Whitfield, Ranking
    Member Rush, and members of the subcommittee, thank you for
    inviting me to testify this afternoon.
        I have the privilege of serving Governor McCrory as
    Secretary of the Department of Environment and Natural
    Resources, and I am grateful for the opportunity to share my
    views on this very important topic. I would also like to
    recognize Representatives Hudson and Ellmers, two distinguished
    North Carolina members who sit on this committee.
        The Clean Air Act specifically provides that states, not
    the EPA, have the primary responsibility for implementing
    programs that protect the resources of this Nation. It is an
    indisputable fact that states like North Carolina have been
    very successful over the past 30 years implementing programs
    that protect public health and welfare, while providing for
    economic development.
        Before I comment on the specific issues of state resources,
    I would like to note the issues that are omitted from my
    comments. First, my comments will not address the scientific
    uncertainty of the impact of human activity and greenhouse
    gases have on climate. My comments do not discuss the accuracy,
    or the lack thereof, of the IPCC models relied upon by the EPA
    to develop this rule, or the divergence between the models'
    predictions and actual temperatures over the past 15 years.
    Although these issues are critical in any decision to regulate
    greenhouse gases, my comments are limited to separate but
    equally important aspects of any final 111(d) rulemaking
    process: that is, state resources, state and utility planning
    efforts, and the legal frailty of the proposed rule.
        I will address the state resources and advocate for what
    North Carolina calls the legal trigger approach to Section
    111(d) implementation. Given the certain litigation that will
    ensue if the proposed rule under 111(d) is promulgated, states
    such as North Carolina are at risk of investing unnecessary
    time and resources, developing and enacting state 111(d) plans
    prior to the resolution of litigation. North Carolina
    recommends that the EPA amend the rule's submittal deadlines to
    require states to submit a 111(d) plan only after the
    conclusion of the judicial review process. Traditionally, when
    the EPA promulgates a new rule that sets forth requirements
    designed to address some aspect of the Clean Air Act, each
    state must take action, usually in the form of legislation and
    rulemaking, to avoid sanctions directly or avoid sanctions on
    its sources. The state then submits a demonstration to the EPA
    for approval, which can take anywhere from a few months to many
    years, during which time the states implement their rules. If
    the rule is struck down, however, the state is forced to uproot
    its earlier work and begin a new planning process; legislation,
    rulemaking, implementation and enforcement, and the process
    must often be amended again when EPA revises its illegal rule
    in an attempt to satisfy the courts.
        This is not just an academic concern. There are several
    recent cases where this study in futility has occurred. The
    EPA's attempts to address economic inequity in regional energy
    markets through interstate pollution rules, such as the
    NOx SIP Call, the Clean Air Interstate Rule, and the
    Cross-State Air Pollution Control Rule, all prime examples.
    There is universal agreement that the 111(d) rule will
    fundamentally restructure how energy is generated and consumed
    in America. I would argue that EPA's Section 111(d) rule is to
    energy what the Affordable Care Act is to healthcare. This
    fundamental change to America's electricity model will come at
    the hands of a rule that few consider legally firm. The EPA
    acknowledges in the rule that it is structured to survive even
    if portions of the rule are struck down. In my more than 20
    years of implementing air quality rules, I am not aware of any
    rule where the EPA has made an a priori acknowledgement of
    legal infirmity.
        Despite the rule's uncertain future, state plans would need
    to move forward to allow, for example, switching from a cost-
    based energy dispatch model to a carbon dioxide dispatch model.
    Under the EPA's current proposal, legislative changes, utility
    resource planning, and regulatory execution must proceed while
    111(d) is under judicial review. EPA's acknowledgement of the
    legal frailty of their creative interpretation of the Clean Air
    Act not only argues for the legal trigger, but it also calls
    Chevron deference into question. In this rule, like many other
    EPA rulemakings, the EPA characterizes statutory language as
    ambiguous to invoke Chevron deference. Unfortunately, the EPA's
    legal track record is so poor that one can only wonder if
    Chevron deference should be withdrawn because the agency has
    abused its public trust.
        Simply stated, if the EPA wants to upend the world's
    greatest power system by forcing a round peg into the square
    hole that is Section 111(d), it should have the prudence to
    allow the final rule to be reviewed by the courts before
    requiring states to undertake such a profound effort.
        Thank you for the opportunity to have testified.
        [The prepared statement of Mr. van der Vaart follows:]
        [GRAPHICS NOT AVAILABLE IN TIFF FORMAT]

        Mr. Whitfield. Thank you, Mr. van der Vaart. And thank all
    of you for taking time to give us your views on this important
    issue.
        I will recognize myself for 5 minutes for questions.
        In my opening statement, I described this proposed
    regulation as being characterized as extreme, a power grab,
    radical, unprecedented, and even unlawful. I think you can come
    to the logical conclusion that this is being implemented to
    implement the President's international agreements.
        And I would ask each of you, the EPA has given the states
    13 months to come up with a state implementation plan if this
    regulation is adopted. Is that an unusually short period of
    time from your personal experience with EPA? Mr. Butler?
        Mr. Butler. Mr. Chairman, it is a very short time frame,
    frankly, one which we don't believe we could ever meet.
        Mr. Whitfield. OK.
        Mr. Butler. And I know some states are different.
        Mr. Whitfield. OK, so it is very short. You don't think you
    can meet it.
        What about you, Ms. Speakes-Backman?
        Ms. Speakes-Backman. Well, thank you for the question. I
    would say that for my state and for the other eight
    participating RGGI states, since EPA has explicitly allowed our
    construct to exist, we already are practicing what they are
    asking for.
        Mr. Whitfield. So you are saying you could meet the----
        Ms. Speakes-Backman. Absolutely.
        Mr. Whitfield [continuing]. Proposed regulation.
        Mr. Graham?
        Mr. Graham. I agree it is short, and I don't think we can
    do it either. We would have to have several special sessions.
        Mr. Whitfield. OK. What about you, Mr. van der Vaart?
        Mr. van der Vaart. The plan that we anticipate submitting
    we could meet. It is not the plan the EPA is seeking.
        Mr. Whitfield. OK. Now, this has been described as a real
    takeover of the electric system in America--generating system.
    Why would EPA, from your personal view, would they want a 13-
    month time period to allow states to implement something this
    complicated? What would be the reason for that? Mr. Butler, do
    you have any idea?
        Mr. Butler. Mr. Chairman, I think it is--as I had pointed
    out in mine, and you had in your testimony, I think the
    President has a goal that he is trying to meet, and is asking
    the states to help him meet that goal, but a very short time
    frame.
        Mr. Whitfield. OK. Why do you think, Ms. Speakes-Backman?
        Ms. Speakes-Backman. I can't say exactly why because I
    don't agree with the premise, necessarily, that it is a
    takeover, sir.
        Mr. Whitfield. OK, what about you, Mr. Graham, do you have
    any idea why?
        Mr. Graham. Mr. Chairman, I would agree with you and Mr.
    Butler on that.
        Mr. Whitfield. OK. Mr. van der Vaart?
        Mr. van der Vaart. I believe that this fictitious sense of
    urgency is not about emission reductions. We are meeting
    emission reductions, thanks in large part to the free market
    and the low cost of natural gas.
        Mr. Whitfield. Yes.
        Mr. van der Vaart. I believe the urgency has to do with the
    fact that they sense that the veil of legal authority has been
    stripped from this rule, and it will soon meet its demise.
        Mr. Whitfield. Yes.
        Mr. van der Vaart. They want to force----
        Mr. Whitfield. Yes.
        Mr. van der Vaart [continuing]. Utility companies to begin
    their planning process----
        Mr. Whitfield. Yes.
        Mr. van der Vaart [continuing]. Which is a lot longer than
    13 months, so that they can get this ball rolling.
        Mr. Whitfield. And, you know, in our first panel, you
    listened to the constitutional arguments and so forth. How many
    of you actually believe that the average citizen out there has
    any basic understanding of the impact of this regulation and
    what it would be? Do you think the average citizen even has any
    insight into this, Mr. Butler?
        Mr. Butler. Mr. Chairman, we did an extensive outreach
    and--as we prepared our comments, and we took a lot of public
    comment on this, but irrespective of that, I think in general,
    the public does not understand any of the technical details of
    any of the legal construct here----
        Mr. Whitfield. Right.
        Mr. Butler [continuing]. That is under debate, nor,
    frankly, what the potential cost might be because we have not,
    frankly, been able to understand the plan well enough or know--
    --
        Mr. Whitfield. You probably don't understand what the cost
    implications are.
        Mr. Butler. Right.
        Mr. Whitfield. Do you think the average citizen understands
    the potential impact of this?
        Ms. Speakes-Backman. I believe that public sentiment is
    increasingly aware of climate change and the issues----
        Mr. Whitfield. I am not talking about climate change, I am
    asking you----
        Ms. Speakes-Backman. And----
        Mr. Whitfield [continuing]. Do they understand the impact,
    in your opinion, of the consequences of this?
        Ms. Speakes-Backman. The impact in our RGGI states is less
    than 1 percent for the overall----
        Mr. Whitfield. So you think they do understand----
        Ms. Speakes-Backman [continuing]. So that----
        Mr. Whitfield. OK, Mr.----
        Ms. Speakes-Backman [continuing]. Impact is not necessary--
    --
        Mr. Whitfield. Mr. Graham, what about you, do you think
    they understand?
        Mr. Graham. I don't think they have any idea. We have
    reached out quite a bit and got very little feedback. I think
    the power generators----
        Mr. Whitfield. Yes.
        Mr. Graham [continuing]. Have an idea of what this is going
    to cost----
        Mr. Whitfield. OK.
        Mr. Graham [continuing]. But I think the financial impact,
    and we really haven't put out----
        Mr. Whitfield. OK.
        Mr. Graham [continuing]. What we propose that some of the
    numbers are until we get the final plan coming back.
        Mr. Whitfield. Do you think they understand, Mr. van der
    Vaart?
        Mr. van der Vaart. No, sir.
        Mr. Whitfield. OK. Now, Mr. Graham, you talked about you
    viewed this as unfair and very costly. Is that your honest
    opinion of the impact of this regulation on the state of
    Florida?
        Mr. Graham. Without a doubt. What gets me, and you see in
    all of the EPA's data, that they said they want to decrease 30
    percent of the CO2 emissions from the 2005 numbers.
    Now, one of the things that Florida has already done from 2005
    to 2012, we have already jumped ahead of a lot of this stuff.
    We switched a lot of things over to natural gas. We are, right
    now, about 65 percent natural gas. We have done a lot of other
    improvements since then, and for you not to take into account,
    because they are using 2012 as the baseline.
        Now, the problem we run into there is that was an all-time
    low for natural gas, so we are using so much more natural gas,
    so the carbon emission that they are putting out there is so
    much lower than it was, like I said, back in '05. And so I
    think----
        Mr. Whitfield. OK.
        Mr. Graham [continuing]. It is unfair that we are not
    getting that credit.
        Mr. Whitfield. Thank you. My time has expired.
        At this time, recognize the gentlelady from Florida, Ms.
    Castor, for 5 minutes.
        Ms. Castor. Thank you, Mr. Chairman. Thank you to the
    panel.
        Mr. Graham, it recently came to light that Florida Governor
    Rick Scott has an unwritten policy that bans the use of the
    terms climate change and global warming. A number of state
    employees and scientists from the Florida Department of
    Environmental Protection, the Department of Health, the water
    management districts, the Florida Department of Transportation,
    have all come forward and said this is the case. I read your
    testimony. Nowhere in your testimony does it use the term
    climate change or global warming. Is that a product of Governor
    Scott's unwritten policy?
        Mr. Graham. Absolutely not. I was told to come here and
    talk about what the financial impact is going to be of
    implementing 111(d), and so that is why that was in my written
    testimony.
        Ms. Castor. Well, and I find your testimony very curious
    because the Florida Public Service Commission has not been on
    the side of consumers, and they have not, your words, you say
    the Clean Power Plan threatens affordability for consumers, and
    the commission will protect consumers from excessive costs, but
    let me give you a few examples of the costs that Florida has
    heaped on our customers. The PFC recently gutted energy
    efficiency initiatives, even though efficiency can meet demand
    at a much lower cost, at a fraction of the cost of building new
    power plants, and can help customers reduce energy use, put
    money back into their pocket, create jobs at the same time. I
    mean we would see larger savings on bills, but that is not the
    business model in Florida. So those stunning rollbacks in
    energy efficiency, especially at a time when we have to be
    looking for ways to save on carbon pollution and save money.
        Here is another example. The Public Service Commission has
    really worked over the past years to stifle renewable energy in
    Florida, and especially solar. You recently stated at a Public
    Service Commission hearing that Florida, sunshine state,
    branding is nothing more than a license plate slogan. Well, I
    hope everyone was watching the weather over this past winter.
    Florida is the sunshine state. We rely on tourism.
        You cited a national renewable energy lab report, but, in
    fact, that report from July 2012 said Florida is indeed ranked
    third in the nation for total estimated technical potential for
    rooftop solar voltaics in the U.S. That same report said
    Florida clearly has the best solar resource east of the
    Mississippi River, but the commission has scrapped solar
    rebates, also going to cost us money, especially with the new
    requirements of the Clean Power Plan.
        And then the best example is what the Public Service
    Commission and the legislature has done to increase bills,
    especially if you are a Duke Energy customer. And my colleagues
    might not be aware, but Florida had adopted an advance recovery
    fee that allowed the utilities to collect costs in advance for
    building power plants. And in fact, even when Duke Energy had
    to scrap a power plant and had to put another one on mothballs,
    without creating one kilowatt hour of energy, customers in my
    neck of the woods, in central Florida, are on the hook for $3
    billion, and that is modest, in costs. $3 billion, not one, not
    one kilowatt in energy.
        So when I hear you talk about affordability, and that you
    are really concerned about the consumers, the record simply
    does not support that in the state of Florida.
        I want to give you time to respond, but we have an
    obligation, we have a shared obligation, to confront these
    issues. And I am sorry, I am going to give you a little time to
    recover, but think about the state of Florida, what consumers
    are going to have to pay in storm water damage, costs to re-
    nourish beaches, what if we have a more powerful storm, that
    comes out of property taxes. You are looking at it in a very
    constrained way; a utility concentric way, and that is not
    reality in our state. Go ahead.
        Mr. Graham. Thank you. We cut back a lot on the energy
    efficiency programs because we have done so much so far. As you
    heard me say earlier, since we started this program, we have
    achieved 9,330 gigabytes worth of----
        Ms. Castor. Mr. Graham, that is simply not the case. There
    is report after report after report that says the state of
    Florida is so far behind. Now we are down to about zero in our
    energy efficiency goals because the business model is
    backwards. It is not a model that helps address the modern
    challenges. It is all about how much energy you can sell. And
    utilities now need to be compensated for helping consumers save
    money. And I really recommend that you take this obligation
    seriously and think about the cost to consumers from here on
    out.
        Thank you.
        Mr. Whitfield. Ms. Castor's time has expired.
        At this time, recognize the gentleman from Texas, Mr.
    Barton, for 5 minutes.
        Mr. Barton. Well, thank you, Mr. Chairman. I had meetings
    in my office so I have been listening to the hearing on the
    television in my office, and I want to commend all four of our
    panelists. I thought your testimony was excellent.
        I am going to start off with a basic question for each one
    of you. We will start with you, Mr. Butler.
        Are the requirements in this Clean Power Plan necessary for
    Ohio to meet any pending nonattainment areas in your state?
        Mr. Butler. No, sir. No.
        Mr. Barton. OK. Ms. Backman, from Maryland.
        Ms. Speakes-Backman. Speakes-Backman. Yes, sir. The
    programs that we already have in place in Maryland have us in
    good stead to meet the goals of the Clean Power Plan.
        Mr. Barton. So it is not necessary in Maryland, OK.
        Gentleman from----
        Mr. Graham. No, sir.
        Mr. Barton [continuing]. North Carolina.
        Mr. Graham. It is not necessary.
        Mr. Barton. And from Florida.
        Mr. van der Vaart. Florida----
        Mr. Barton. Florida. North Carolina. I have you backwards.
        Mr. van der Vaart. But the same answer, no.
        Mr. Barton. So this is not a necessary thing under the
    Clean Air Act amendments to meet any standards for
    nonattainment. In fact, is it a true statement that nothing in
    this Clean Power initiative sets a standard of emission
    reduction in your state? Is that a true statement? There is not
    a target you have to meet in terms of parts per million or
    anything like that?
        Mr. Butler. It is not, sir.
        Mr. Barton. It is not. Is it a true statement that what
    this is is social planning imposed on your state by the Federal
    Government? We will start with you, Mr. Butler.
        Mr. Butler. We believe it is an unprecedented act--
    unprecedented action that, frankly, has not--does not have any
    congressional intent behind it.
        Mr. Barton. OK. Now, Ms. Speakes-Backman, I was impressed
    with what you said in your testimony. It sounds like Maryland
    is part of a regional group that has voluntarily come together,
    set your own goals, and increased your renewable energy
    portfolio, and done quite a bit of good things, but you did
    that because the compact or the coalition that your state is a
    part of made a voluntary decision to do that. Is that not
    correct?
        Ms. Speakes-Backman. Yes, sir. We voluntarily decided to
    take control of our environment, of the reliability issues that
    we were facing, and with cost increases to our ratepayers.
        Mr. Barton. And I have no problem with that. I think that
    is good and I am glad Maryland is doing it, but how would you
    feel if we passed a law here that said Maryland had to use
    triple the amount of Texas=produced natural gas in that? Would
    you like that? Clean-burning Texas natural gas, I might add.
        Ms. Speakes-Backman. Well, seeing, sir, that we use plenty
    of Pennsylvania clean natural gas----
        Mr. Barton. I understand, and I am not here to----
        Ms. Speakes-Backman. But----
        Mr. Barton [continuing]. Knock Pennsylvania, but my point
    is----
        Ms. Speakes-Backman. But, sir, I think the issue--I think
    the question that you are asking me is about being forced to
    use one particular type of fuel or another, which is not
    necessarily how this Clean Power Plan is structured. This Clean
    Power Plan is structured----
        Mr. Barton. Well, in the case of Texas, if Texas decides to
    try to comply with this, we have to shut down 45 percent of our
    existing coal-fired power plants; two of which are in my old
    congressional district. Those two power plants are the economic
    linchpins in their counties. These are rural counties in south
    central Texas. One power plant has been there over 40 years,
    the other power plant has been there 25 years. I mean they are
    the economic mainstay in those particular counties, and they
    would be shut down. They would be shut down for no
    environmental reason. No environmental positivism. None.
        As the gentleman from West Virginia or Virginia pointed
    out, you know, \6/10\ of 1 percent decrease in CO2
    over a 30 or 40-year period. I mean it is crazy.
        The chairman asked a question about why the 13-year--month
    period to--13-month period to comply, and you all were very
    polite about giving non-answer answers, but I think the reason
    is because the Obama Administration is going to be out of
    office, and they want this thing put in while they are still in
    office. Now, that is speculation on my point, but it is
    informed speculation.
        Again, I have no problem with what any of your states are
    doing, and I am extremely impressed with what Maryland is
    doing. I think that is a good thing. I believe in states'
    rights. New York doesn't want to allow hydraulic fracturing, so
    they don't. Pennsylvania allows it, but with different
    reporting requirements than Texas. I believe in federalism, it
    is a good thing, but I don't believe in this new Clean Power
    Plan initiative that is imposing a social policy on the states,
    with no environmental benefit and no real opt-out provision.
        With that, Mr. Chairman, I yield back.
        Mr. Whitfield. Gentleman yields back.
        At this time, recognize the gentleman from New Jersey, Mr.
    Pallone, for 5 minutes.
        Mr. Pallone. Thank you, Mr. Chairman.
        Commissioner Speakes-Backman, I wanted to ask you a
    question about the Regional Greenhouse Gas Initiative.
        Ms. Speakes-Backman. Any time, sir.
        Mr. Pallone. I wasn't here for your testimony. I had to go
    to another committee hearing, but in your testimony you state
    that through 2013, RGGI states reinvested over $950 million of
    auction proceeds and energy efficiency, clean and renewable
    energy and other strategic energy programs. And you note that
    these proceeds have helped low-income families pay their energy
    bills, supported energy efficiency upgrades, and helped
    families and businesses install solar, wind, and geothermal
    systems at their properties. In fact, under RGGI, just last
    week, the sale of 15.3 million carbon dioxide allowances netted
    $82 million and set a record high price.
        So the question is, the RGGI program seems to be the most
    effective and efficient way for states to meet the standards
    set forth in the EPA's Clean Power Plan. Can you tell me about
    the environmental and economic benefits this is providing to
    the state of Maryland?
        Ms. Speakes-Backman. Yes, sir. Thank you for the question.
    And, yes, in fact, there were an additional $82 million just
    last Friday announced in our just last previous auction.
        In Maryland specifically, we have reinvested the auction
    proceeds in consumer benefit programs. It has helped more than
    215,800 low-income Maryland families to pay their energy bills.
    It has supported energy efficiency upgrades at 11,800 low-to-
    moderate income households, helped 5,206 families, and 201
    businesses in Maryland to install solar, wind, and geothermal
    systems.
        Mr. Pallone. So I mean obviously, the program has been
    tremendously effective in Maryland and other participating
    states, and these states are going to have a leg up when it
    comes to meeting the EPA standards.
        Now, I am just mentioning this in part because that is why
    I am so disappointed that, in my home state of New Jersey, our
    governor, Chris Christie, has withdrawn our state from the
    program, as you know. And not only is this going to hinder New
    Jersey's ability to meet the EPA standards, it is actually
    costing the state money. According to an analysis by
    Environment Northeast, since New Jersey withdrew from the RGGI
    program in 2011, the state has passed up more than $114 million
    in potential revenue, and the state could miss out on an
    additional $387.1 million through 2020, and those figures don't
    even account for the record price for allowances hit at the
    RGGI auction last week, which you mentioned. That is money that
    could be used to use support energy efficiency upgrades and job
    creation, like it is doing in Maryland and other participating
    states. So I know he is not with us here today, but I have
    called on Governor Christie to reconsider his decision to
    withdraw from RGGI because I think New Jerseyans deserve to
    reap the benefits of this successful, economically-efficient
    program, which is reducing carbon emissions and creating jobs
    in the northeast.
        Now, I have about a minute and a half. I know that--if you
    wanted to respond to some of the questions that were asked
    before that maybe you didn't have time for, you could use the
    time to do that, unrelated to my question.
        Ms. Speakes-Backman. Thank you very much, sir.
        May I just add that the car analogy in the panel before was
    so interesting to me in that, you know, what can be done in--
    for the car is a catalytic converter, but to me, when I think
    about a mass-based regional program such as RGGI, and taking
    that same analysis, it is like having a catalytic converter but
    then you put a variable toll on the roads that is outside the
    box. Right? It is outside the car system. And putting a toll on
    those roads, you can take the money and you can reinvest that
    in R & D so that you can further improve the equipment that is
    put on the car to reduce emissions. But in addition, you can
    take those revenues and further control traffic by putting the
    tolls on certain roads that are busy. You can do things like
    improving those roads themselves. There are ways to reinvest
    and to make this a positive.
        I don't think it is mutually exclusive to help your
    environmental goals and to build your economies.
        Mr. Pallone. All right, thank you so much.
        Thank you, Mr. Chairman.
        Mr. Latta [presiding]. Thank you very much. And before I
    recognize myself for 5 minutes, I would like to ask unanimous
    consent from the committee to enter a letter dated December the
    1st, 2014, from Director Butler of the Ohio EPA to the
    respondent and also the executive summary. And these documents
    were submitted to the U.S. EPA as part of their comments to
    oppose the Clean Power Plan.
        Without objection, so ruled.
        [The information appears at the conclusion of the hearing.]
        Mr. Latta. If I could start, Director Butler, and also to
    all of our panel, thanks very much for being here. Again, it
    has been very informative.
        But, Director, if you would, would you expand on the
    reference you made to the differences in the 2005 and 2012
    baselines, and how this would affect Ohio by not taking into
    consideration the early action that many have taken to improve
    that efficiency?
        Mr. Butler. Mr. Chairman, thanks for the question. And I
    think Mr. Graham made a couple of very relevant points in his
    testimony to this fact as well.
        Ohio has many utilities that are very early adopters in
    making sure that their plants run as efficiently as possible.
    Frankly, the hundreds of millions of dollars that they have
    invested will be left on the cutting room floor, if you will,
    if the Clean Power Plan, which talks about a 2005
    implementation date, is passed. In reality, that date of
    looking to develop a plan is all based on the year 2012. So any
    emission reductions or, frankly, efficiency improvements that
    have been made prior to 2012 will not count. We think that that
    not only disincentivizes our utilities from doing that work,
    but it, frankly, also makes it much more difficult for them to
    comply, if not exceptionally more expensive for them to comply
    going forward with meeting the new bucket 1 requirements of
    having a 4 to 6 percent energy efficiency improvement.
        Further, we have talked to our utilities as part of our
    dialog and comments on the Clean Power Plan. They think it is
    fundamentally very difficult, if not impossible, to reach that
    4 or 6 percent efficiency improvements at our existing
    utilities. Our fleet has gotten much more efficient, ironically
    because many of those units were shut down because of the
    mercury standard, others were improved because they wanted to
    be more efficient and generate more power into the grid. But
    those costs were heavy, and they think that a 1 to 2 percent
    improvement would be all that they could develop to comply with
    the Clean Power Plan.
        Mr. Latta. Thank you. If I could continue, Director, could
    you also explain the issues you foresee with the costs and the
    efficiency related to the EPA's building block number two,
    which will result in the natural gas-fired units used for base
    load power in coal-fired plants into peaking power?
        Mr. Butler. Mr. Chairman, I think the earlier reference
    about the Clean Power Plan fundamentally is changing the
    electric distribution market from really one that is based on
    cost, to one based on environmental impact, and that is a
    serious, serious problem. In addition, just the discontinuity
    between the way EPA has set up the Clean Power Plan bucket one
    on efficiencies at power plants versus bucket two where they
    are wanting to see natural gas generation run at a 70 percent
    rate. I think we see two fundamental problems. One is we will
    see significant closures and--as we already have of our coal-
    fired fleet, and we will see some, but I don't know yet how
    much natural gas generation come online. There is a disconnect
    on how those work, so we are really concerned, as many others
    are, about the power grid being able to supply power.
        Fundamentally, we also find an inconsistency here. While
    EPA is requiring or suggesting that the power plants become
    more efficient, and invest hundreds of millions of dollars to
    do that, that they not be allowed to run to recover those costs
    because they are then driving gas to take over that capacity.
        Mr. Latta. Well, when we look at Ohio, right now, is Ohio
    about 71 percent coal-fired?
        Mr. Butler. Yes, sir.
        Mr. Latta. And when you look down the road at what the EPA
    is ordering, and it was already discussed, I think, by the
    chairman, the question really comes then to, with all these
    costs being put onto these power plants, who is going to pay
    for that in the long run?
        Mr. Butler. Right. Mr. Chairman, we are very concerned
    because we think all of those costs get passed onto the
    consumers of Ohio.
        Mr. Latta. Especially when you have put out in your
    discussions with the EPA, have they even talked about what the
    consequences are? Do they look at what it would do to a state
    like Ohio with 71 percent coal generated, especially for our
    business communities and the people that work in those
    factories and businesses?
        Mr. Butler. Mr. Chairman, I believe they probably do think
    about Ohio, although we were very concerned, frankly, dismayed,
    when U.S. EPA--they do talk about they have had some extensive
    outreach across the country, and they did attend listening
    sessions across the country. We, frankly, invited, as did our
    states in West Virginia and Kentucky, to come to any three of
    our states and hold a listening session to see and hear from
    the general population that were actually going to be very much
    impacted by this Clean Power Plan, and they elected not to come
    to any of our three states.
        Mr. Latta. So you put on an invitation and they just did
    not come.
        Mr. Butler. Yes, sir.
        Mr. Latta. Thanks very much.
        My time has expired, and the chair will now recognize Mr.--
    --
        Voice. Mrs. Capps.
        Mr. Latta [continuing]. The gentlelady from California,
    Mrs. Capps, for 5 minutes.
        Mrs. Capps. Thank you, Mr. Chairman, for holding this
    hearing. And I want to thank all of our witnesses for your
    testimony.
        It is so clear that the power sector is responsible for a
    major portion of carbon dioxide emissions in the United States,
    but it is also clear that these emissions are causing our
    planet's climate to change at an unprecedented rate. We need to
    act today to curb these emissions and prepare for the
    consequences that are forecast. Fortunately, and, Ms. Kelly
    Speakes-Backman, you spoke to this, that the Regional
    Greenhouse Gas Initiative, or RGGI, has really impressively
    reduced emission rates, and has done so while also improving
    the regional economy and fostering job creation. My colleague
    from New Jersey asked you about that, and unfortunately,
    apparently, his state of New Jersey has backed away from it,
    but I hope that this momentum will build. I think it is clearly
    possible to increase energy efficiency, reduce emissions, and
    provide affordable energy for local residents.
        So in addition to carbon emissions, the power sector
    generates so many other harmful pollutants, including sulfur
    dioxide, nitrous oxide and mercury, to name a few. In addition
    to exacerbating the impacts of climate change, these pollutants
    have direct impacts on human health, leading to increased rates
    of respiratory problems, contributing to heart attacks,
    strokes, and even premature death. This has been documented,
    and is being documented. The benefits of reducing carbon
    dioxide and these other pollutants under the Clean Power Plan
    will likely have benefits that far outweigh the cost of
    implementation, especially in the health sector.
        And I wanted to ask you how this implementation of RGGI has
    affected the benefit of human health in your area.
        Ms. Speakes-Backman. Thank you for the question. As you
    know, in Maryland especially, we are a little bit downwind of
    some of the coal plants that are in the Midwest, and they have
    directly affected the health and the costs of that health to
    our citizens. And so as part of the effort that our state has
    undergone to try to mitigate those health issues, as well as to
    mitigate the reliability issues that we have had from frequent
    storms, increasing frequency and severity of storms, the costs
    our ratepayers have had to incur in order to build up
    resilience against such storms, there are lot of costs aside
    from the work that is going to be done under the Clean Power
    Plan that need to be taken into account when you are doing a
    full cost benefit scenario.
        Mrs. Capps. Yes. Thank you. Significant reductions in
    sulfur dioxide and nitrous oxide and mercury has benefitted
    over the long haul, but they are offset by downwind and other
    aspects that tell us that we are not fully where we want to be
    yet.
        Mr. Butler, I wanted to turn to you, if I could. In August
    of last year, the waters off Lake Erie, off the coast of
    Toledo, experienced a harmful algae bloom that impacted
    drinking water for about 400,000 people. Am I correct?
        Mr. Butler. Yes, ma'am.
        Mrs. Capps. The science is increasingly clear that harmful
    algal blooms will become more severe a frequent in the future
    due to climate change. This means more human health costs, more
    taxpayer dollars spent on clean-up, unless we take action to
    reduce carbon emissions. In your testimony, you focused
    exclusively on the financial costs of implementing the Clean
    Power Plan, but, you know, in the constraints of time perhaps
    you weren't able to reach any of the benefits. Would you agree
    that human health benefits such as fewer harmful algal blooms
    and cleaner air, should all be considered in doing a full
    assessment of the Clean Power Plan?
        Mr. Butler. Mrs. Capps, if you have an opportunity, in our
    extensive comments, we submitted U.S. EPA, and then were
    brought into the record today----
        Mrs. Capps. Great.
        Mr. Butler [continuing]. You will see an extensive
    summarization of our issues related to this issue about
    suggesting that there will be significant human health
    improvements by regulating carbon.
        Mrs. Capps. Yes.
        Mr. Butler. We do not believe that is the case, and do not
    believe that the science proves it. Now, however, in a lot of
    reductions that come along, we have improved our sulfur dioxide
    and ozone emissions in Ohio and in our downwind states. I mean
    we do not deny the fact that there have been many, many, many
    improvements to public health, but I think it is not
    appropriate to tie that back to CO2 emissions----
        Mrs. Capps. Perhaps that needs to be----
        Mr. Butler [continuing]. Close to the Clean Power Plan.
        Mrs. Capps. Perhaps we need to do more studies along that
    health. The EPA's proposal, I believe, the Clean Power Plan, is
    an important step forward in combatting climate change, will
    ultimately lower. How this is impacted, as your colleague
    sitting next to you indicated, it takes some time and I believe
    we should go further into studying the effects of changes that
    are being made more thoroughly as they relate to regional and
    other factors. And this is all about the health of our
    constituents.
        And I know I am out of time, so I support this plan, and I
    am going to yield back now.
        Mr. Whitfield. At this time, I recognize the gentleman from
    Virginia, Mr. Griffith, for 5 minutes.
        Mr. Griffith. Thank you, Mr. Chairman.
        The gentlelady just referenced it in her comments about her
    concerns about global warming and the health concerns, and then
    she went on to say that maybe we need to take some more time,
    we need more studies on the health. Mr. Butler, it is my
    understanding that, in fact, the EPA has not done any science
    on this particular regulation and how much it would change
    climate change, but that using the normal EPA modeling
    procedures, the American Coalition for Clean Coal Electricity
    did run an analysis on how much the rule would reduce climate
    change, and the American Coalition for Clean Coal Electricity
    found that atmospheric CO2 concentrations would only
    be reduced by less than 1 percent in 2050, the increase in
    global average temperature would only be reduced by \16/1000\
    of a degree Fahrenheit in 2050, sea-level rise would only be
    reduced by .3 mm or \1/100\ of an inch. This is the equivalent
    of a piece of paper, or a couple of pieces of paper. And so
    taking that all into consideration--well, first let me say, do
    you know of any other studies out there, other than the one
    that I have referenced, that indicate there is going to be some
    huge change to what sometimes is referred to as global warming,
    but more commonly, particularly in the east, is referred to as
    climate change, since warming hasn't happened?
        Mr. Butler. Yes, Mr. Griffith, I am unaware of any
    additional studies. We did a very extensive search when we did
    our comments on the Clean Power Plan, and the ones that you
    referenced are many of the studies that we also took a look at
    as part of our review of the Clean Power Plan.
        Mr. Griffith. OK, but you don't have any direct numbers
    from the EPA themselves?
        Mr. Butler. We do not.
        Mr. Griffith. And notwithstanding the fact that they
    haven't taken the time, that Mrs. Capps referenced, maybe to
    look at this matter and the health studies, et cetera, and
    whether or not this would affect anything, this rule is coming
    down your state's throat any day now, isn't it?
        Mr. Butler. Yes, sir, it is. We are very concerned about
    the resources that it will take on our state levels to, on the
    one had have these discussions and perhaps even legal issues
    around the implementation, but at the same time go down the
    path of having to commit our state resources to develop an
    implementation plan that, at the end of the day, one, may not
    be necessary, two, that may change significantly from where we
    started.
        Mr. Griffith. Right. And so your folks are being forced to
    go forward, even though there are all kinds of legal
    implications going on. And as you could probably tell from the
    previous panel and the debate there, I am very well versed, and
    I believe the EPA does not have authority. We will stay tuned
    to see what the courts say, but I don't think you can change
    the law just because you find some reference in the closet that
    says that maybe there was a different interpretation, because
    if either side adheres to their position, there is no bill.
    Senate said it receded.
        Without getting into all that legal argument, Secretary van
    der Vaart, your state is going to have to comply even though
    the legalities and the fight over the legalities may continue,
    you have to go ahead and get a plan out there. Isn't that true?
        Mr. van der Vaart. Well, that is right, and I think that
    that is why I am here. There are a lot of things we can say. I
    applaud Maryland and the rest for doing what they want to do.
    North Carolina has made major reductions since the 2005 date.
    America generally has dropped its carbon dioxide emissions from
    2010 to 2013 by 10 percent, and it was all done without the
    benefit of a federal action. It was done primarily by the
    revolution that is our natural gas production here in America.
        But yes, the concern we have is developing legislation,
    developing rules, our utility regulatory system has to be
    altered----
        Mr. Griffith. And you will spend a lot of money going down
    that path, and then the Supreme Court comes out a year and a
    half, 2 years, 3 years from now and all of a sudden, it all has
    to start over again.
        Chairman Graham, your power plants are facing that same
    problem, but even if this thing goes forward, a number of them
    are going to have to be shut down before their useful life
    ends, isn't that correct?
        Mr. Graham. That is correct. We are about 20 percent coal
    in Florida. Like I said, we switched to a lot of natural gas
    early on, and they are talking about closing down about 90
    percent of our coal plants.
        Mr. Griffith. And so you are going to be hurting, and also
    that means that you are going to have some stranded costs, and
    that means the increased cost we pay will go on to your
    ratepayers, isn't that correct?
        Mr. Graham. It is almost like they paid for the plant
    twice. They paid for the plant, and they have all this useful
    life left, and then we have to shut it down.
        Mr. Griffith. And the beauty of natural gas and some of the
    energy revolution is that we can attract jobs back to the
    United States but we have to have affordable energy, and this
    plan doesn't do much for the environment, and it damages our
    ability and our reputation in the world to have affordable
    energy. Isn't that true? I don't have time for an answer, but I
    assume that it is with most of you. Ms. Speakes-Backman, I
    agree you would disagree, but I recognize that, and yield back.
        Mr. Whitfield. Gentleman's time has expired.
        At this time, recognize the gentleman from New York, Mr.
    Tonko, for 5 minutes.
        Mr. Tonko. Thank you, Mr. Chair. And thank you to our
    panelists for appearing before the subcommittee.
        And Commissioner Speakes-Backman, let me address my
    comments first and foremost to you. Welcome, and thank you for
    your service as chair of the RGGI Board of Directors. As you
    have noted, New York is a member of RGGI. In my last
    workstation before service here in the House, I was president
    and CEO of NYSERDA, New York State Energy Research and
    Development Authority, which got me a seat at the RGGI table.
    And so I am very thankful for your leadership and for carrying
    forth with the mission of that plan.
        As a participant in RGGI, New York has been able to
    accomplish a great deal. Greater energy efficiency, cleaner
    air, expanded deployment of renewable energy technologies, and
    these are just a few of the benefits, many that are arising.
        EPA's proposal is just that at this stage; a proposal. I
    support its goals. As a proposal, I am sure it will evolve and
    change, perhaps, before the final rule is released. There,
    however, seems to be a number of utilities and states that are
    claiming the goals of the proposal cannot be achieved without
    severe economic hardship, and sacrificing our electricity
    reliability. You seem to take a different view. Why are you
    convinced that these predictions are wrong?
        Ms. Speakes-Backman. Well, thank you for your participation
    in RGGI as a state, and thank you for the question.
        I do take a different position, and in fact, I take the
    position that RGGI, coupled with our other state policies, has
    helped us to improve reliability. So specific to the
    reliability issue, which is very near and dear to my heart, and
    it is actually part of my legal obligation as a commissioner of
    the Maryland Public Service Commission, we have implemented
    RGGI within the construct of existing markets, and that
    includes the North American Electric Reliability Corporation's
    oversight of bulk system reliability. It includes FERC's
    retaining its authority over the market's design. It includes
    also reliable dispatch of least cost resources remaining with
    our grid operation system. So this is not an upending of the
    systems. We have been doing this for 8 years, and we have had
    fewer reliability issues because we have been able to support
    programs such as demand response and energy efficiency to help
    reduce the load in specifically load pocket areas.
        Mr. Tonko. Thank you. And also there are those who would
    argue that sound stewardship of our environment and economic
    recovery, the growth of our economy, cannot go hand-in-hand.
    Are there any stats that you can cite in terms of perhaps job
    growth in the energy areas that have enabled us to strengthen
    our economy and provide for cutting-edge new opportunities with
    innovation as it relates to the energy arena?
        Ms. Speakes-Backman. Yes, sir. I can speak specifically to
    the state of Maryland with respect to jobs. I would have to
    look up that number, but I believe it is in my written
    testimony, sir, but we have created jobs and we have improved
    our economy, while we have reduced by 40 percent our carbon
    dioxide from power plants. And I am sorry, I don't have that
    number at my fingertips.
        Mr. Tonko. Well, I am certain that you also--other
    participants at the RGGI table representing that array of
    states, but I think it can be documented that we have grown a
    new culture of job activity, all while strengthening the
    environmental outcome, and----
        Ms. Speakes-Backman. Absolutely.
        Mr. Tonko [continuing]. The sense of environmental justice
    that has been produced by RGGI accompanies that of social and
    economic justice. So, I think that there is this whole silo
    effort to look at certain impacts, needs to be looked at in a
    fuller array, a broad view that provides for a strong context
    of a better future for all of the states involved.
        Ms. Speakes-Backman. Absolutely, sir. I just recalled the
    number. In the first 3 years of our program alone of RGGI, we
    have created 16,000 job years in our region.
        Mr. Tonko. How many, sorry?
        Ms. Speakes-Backman. 16,000 job years in our region. Based
    on the further reductions that we made through a program review
    in 2014, an independent analysis by the Analysis Group has
    shown that we will add yet another 130,000 job years to our
    region.
        Mr. Tonko. Thank you very much.
        And with that, I see my time is up.
        Mr. Whitfield. Gentleman's time has expired.
        Mr. Tonko. I yield back.
        Mr. Whitfield. At this time, I recognize the gentlelady
    from North Carolina, Mrs. Ellmers, for 5 minutes.
        Mrs. Ellmers. Thank you, Mr. Chairman. And thank you to our
    panel, especially to you, Secretary van der Vaart, for being
    here from North Carolina.
        As your position as secretary of DNR North Carolina, and as
    an attorney, can you reflect a little bit about the discussion
    that took place on panel 1 about the ambiguities that exist
    between the rule--the 111 and the 112, especially focusing back
    to 1990 when it was first put forward?
        Mr. van der Vaart. Yes, ma'am. Yes, ma'am. That is a good
    point. The previous discussion, I would warn you all, maybe
    appears to me, at least, setting up a straw man, the question
    of whether the codified versus the statute at large language
    actually controls. The fact of the matter is, it doesn't
    matter. Even if you take the statute at large, there is no
    ambiguity, and the reason is in 1990, the Clean Air Act, under
    Section 112 was fundamentally changed from a pollutant-based
    program to a source category-based program. And, therefore, the
    language in the statute at large is entirely consistent with
    what happened at that point.
        Mrs. Ellmers. Yes.
        Mr. van der Vaart. And I am afraid that the previous
    discussion, for one reason or another, may have missed that.
    And so it is very good that you keep that in mind. Thank you.
        Mrs. Ellmers. And then getting back to some of the--there
    again, the discussion that took place in the first panel, one
    of my questions is really about implementation of this, and
    especially when it comes to 111, in the building block number
    4, and there again, Secretary, from your perspective, how can
    this possibly be enforced, or can you foresee a way that the
    EPA would actually be able to enforce this on North
    Carolinians?
        Mr. van der Vaart. That is a very good question, and we
    have thought very hard about it. Another misunderstanding that
    many people have about the Clean Air Act is that somehow 108
    and 110 are implemented similarly to 111. That is not the case.
    When a state fails, for whatever reason, to submit an
    approvable plan under 110, 108, to protect NAAQS, the state
    itself is subject to sanctions including highway funds removal.
    That is not the case in 111.
        Mrs. Ellmers. Yes.
        Mr. van der Vaart. If we do not submit an approvable plan,
    there is no downside for North Carolina as such as the
    government, however, the Federal Government will then enforce
    directly to the source. And so, Representative Ellmers, you are
    giving me a specter of what happens to my grandma when she----
        Mrs. Ellmers. Yes.
        Mr. van der Vaart [continuing]. Doesn't screw in a CFL bulb
    in her house. Is she going to be thrown in jail by the feds? Am
    I going to be thrown in jail because I am somehow missing my
    obligation, or is the utility executive somehow going to get
    thrown in jail, when really maybe the EPA should be thrown in
    jail. So----
        Mrs. Ellmers. Well, there again, it is part of that ongoing
    discussion of comparing apples to oranges and kind of
    alternative universes when we are talking about this issue.
        My final question for you, Secretary van der Vaart, is,
    there again, looking towards our North Carolinians, is it
    economically feasible and fiscally responsible for us to
    foresee a future where we go from a cost-based energy dispatch
    model to a carbon dioxide-based dispatch model?
        Mr. van der Vaart. We can put a man on the moon. We can
    certainly do this, but it will be at a cost, and unfortunately,
    the people who are going to bear that cost are the ones least
    able to afford it. It is going to be our lower and middle class
    folks, it is going to mean the job losses for high-paying
    manufacturing jobs because electricity prices is fundamental to
    siting of new manufacturing. So yes, we can do it. Is it legal?
    Absolutely not. And, in fact, as you heard, it is already been
    going on in a more cost-effective manner by the states
    themselves.
        Mrs. Ellmers. Yes.
        Mr. van der Vaart. So what we have here is a Federal
    Government attempt to upend, as I said, the world's greatest
    electricity system through a little-known codicil in the Clean
    Air Act.
        Mrs. Ellmers. Thank you, sir.
        And I will just close out by saying that North Carolina has
    made such strides, and thank you, a lot of it is due to your
    leadership and moving forward on clean energy. And I believe
    North Carolina, and so many other states that have taken these
    steps already, need and deserve that credit. So thank you all
    to the panel.
        And thank you, Mr. Chairman. I yield back the remainder of
    my time.
        Mr. Whitfield. Gentlelady yields back.
        At this time, recognize the gentleman from Ohio, Mr.
    Johnson, for 5 minutes.
        Mr. Johnson. Thank you, Mr. Chairman. I appreciate it. And,
    Director Butler, thank you for joining us today from the great
    state of Ohio.
        Lot of concerns there about the things that we have talked
    about this morning. Director Butler, it seems as if the
    Administration is ignoring the lawsuit that many states,
    including Ohio, are currently engaged in with the EPA, and
    instead they are solely focused on the implementation of the
    rule. Given all the legal issues surrounding EPA's 111(d)
    proposal, would you support the EPA setting aside the
    implementation planning until legal challenges are resolved?
        Mr. Butler. Mr. Johnson, thanks for that question. I think
    Professor Tribe is far more eloquent than I am on these issues
    in the previous panel, but I think to your point, I think that
    is the exact request that we would have and have made to U.S.
    EPA to have them consider. I look at it from a state resource
    application. We will likely be, if the Clean Power Plan evolves
    as a final plan, much like the draft plan, and it still has
    what we believe are its legal flaws, will be challenging that
    law with many other states. That will not, unless things
    change, relieve us from the obligation to be developing at the
    same time in a parallel path, expending state resources to
    develop a plan of implementation in a very tight time schedule
    that, as you have heard, we don't think we can meet. Those are
    scarce state resources, frankly, we cannot and should not have
    to expend. So directly to your question, I have advised and
    asked U.S. EPA, because there is no compelling deadline
    relative to this issue about carbon, that we set this
    implementation issue aside and have our requisite debate about
    the legal issues, and then go from there.
        Mr. Johnson. Well, let us expound on that a little bit.
    States like Ohio, and others that we have talked to here today,
    are implementing a number of new and older EPA regulations
    ranging from the Mercy and Air Toxics Rules, to particulate
    matter standards, to new ozone rules. So can you expand a
    little bit, doesn't this put strain on state resources, and
    what happens if, on top of all of this, states also have to
    implement a final 111(d) rule that eventually could get thrown
    out in court? And the reason I say that is because we have seen
    that scenario before. The brick industry invested hundreds of
    millions of dollars into complying with a set of standards that
    the courts threw out, and then they got virtually no credit by
    the EPA for all that investment that they did, and the EPA
    certainly was not standing there ready to give them their money
    back.
        Secretary van der Vaart, if they do get thrown in jail,
    they had better not call me for bail money because I am not
    going to be at the table.
        How do you feel about that, Mr. Butler?
        Mr. Butler. Yes. Mr. Johnson, I--thanks for that question.
    I think we have seen--we always are trying to comply with our
    delegated programs and certainly our air programs. We have made
    tremendous success in air quality in Ohio. We have seen an
    unprecedented number of regulatory requirements come down the
    road.
        So you mentioned the mercury rule. Not only does that, you
    know, add to the time commitment and planning and
    implementation for compliance, it is, frankly, having to shut
    down \1/4\ of our coal generation fleet in the state of Ohio.
    So we are concerned about that. Today, ironically, as we sit
    here is the same day that we are required to submit our
    comments on the proposed new ozone standard, and we are just on
    the cusp of, frankly, getting to the point of being statewide
    full compliance of the 2008 ozone standard. I would love to,
    frankly, declare victory on that and say--but no, we are in a
    position now where we are having to decide whether or not we
    need to drop that standard further, and whether or not the
    science is supportive of that. We are, in addition, in the
    midst of looking at both the particulate matter and
    SO2 rules, and whether or not, frankly, we move down
    the path of having additional ozone transport regulations. And
    the list goes on.
        So that puts an incredible strain on us as state regulators
    and implementers, and is, frankly, just an additional cost that
    we are requiring to our legislature to pass on to customers.
        Mr. Johnson. Well, thank you.
        Secretary van der Vaart, do you have a comment on that as
    well?
        Mr. van der Vaart. Well, I would just like to emphasize
    again, America is moving toward cleaner energy. It is moving
    that direction because of the free market and our revolution in
    natural gas exploration and production. We are all states doing
    what we think is right in cleaning up the environment, and I
    think it is not a time to rush to judgment when we have such a
    flawed proposal.
        Mr. Johnson. Thank you very much.
        Mr. Chairman, I yield back.
        Mr. Whitfield. The gentleman's time has expired.
        And I want to thank all four of you for joining us today to
    discuss this significant issue.
        I would like to also include the following documents in the
    record. Comments submitted to EPA on the proposed 111(d) rule
    by the Florida Public Service Commission, and the Florida
    Office of Public Counsel.
        [The information appears at the conclusion of the hearing.]
        Mr. Whitfield. And we will keep the record open for 10
    days. I was going to come down and say hello to each one of you
    personally, but we have a vote on the floor and it is almost 15
    minutes gone now, so I am going to rush out, but we look
    forward to working with you. Thank you very much.
        And that adjourns today's hearing.
        [Whereupon, at 1:39 p.m., the subcommittee was adjourned.]
        [Material submitted for inclusion in the record follows:]
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