Election-eve study shows potential job losses from coal shutdowns

A new analysis of U.S. Environmental Protection Agency regulations that would impact the coal-based electricity industry projects that seven rules would reduce U.S. employment by 1.5 million jobs over the next four years.

The analysis was conducted by National Economic Research Associates (NERA) on behalf of the American Coalition for Clean Coal Electricity. It is described in a 129-page report, “Economic Implications of Recent and Anticipated EPA Regulations Affecting the Electricity Sector.”

The report comes out a time that is close to the November presidential election amid Republican complaints that the Obama Administration is waging a “war on coal” and Republican presidential nominee Mitt Romney has declared “I like coal.”

“If the EPA is allowed to continue its aggressive anti-coal agenda, the American economy will lose another 1.5 million jobs in the next four years,” said Mike Duncan, president and CEO of ACCCE. “The EPA does not consider the economic consequences of their actions, which in this case will not only erase American jobs; it will raise annual costs to families by hundreds of dollars, the equivalent of a monthly grocery bill.”

Key findings of the NERA analysis include:

  • EPA regulations will cause employment losses totaling 1.5 million jobs over just the next four years, with a quarter million of those job losses occurring in the Midwest. Employment losses will continue beyond that timeframe, averaging 544,000 to 887,000 jobs annually.
  • Electricity consumers will spend as much as $67 billion more for electricity.
  • The average family’s income will drop by $200 to $500 annually, which is equivalent to a family’s monthly grocery bill.
  • An unprecedented number of coal-fired power plants will be forced to shut down. Between 54,000 MW and 69,000 MW of coal-fueled  generation will be shut down, mostly because of the EPA regulations. This is roughly equivalent to the combined electricity supplies of Ohio, Virginia and Iowa. This is also more than the total electricity supply of either Pennsylvania or Florida.
  • The electric sector faces enormous compliance costs. Electricity generators would be required to spend $15bn to $16.7bn annually on compliance costs over the next two decades.

ACCCE is a non-profit, non-partisan partnership of companies involved in producing electricity from coal. Members include coal producers Alpha Natural Resources (NYSE: ANR) and Arch Coal (NYSE: ACI), and power companies American Electric Power (NYSE: AEP) and Basin Electric Power Cooperative.

About Barry Cassell 20414 Articles
Barry Cassell is Chief Analyst for GenerationHub covering coal and emission controls issues, projects and policy. He has covered the coal and power generation industry for more than 24 years, beginning in November 2011 at GenerationHub and prior to that as editor of SNL Energy’s Coal Report. He was formerly with Coal Outlook for 15 years as the publication’s editor and contributing writer, and prior to that he was editor of Coal & Synfuels Technology and associate editor of The Energy Report. He has a bachelor’s degree from Central Michigan University.