H.R. 1582: Energy Consumers Relief Act of 2013

H.R. 1582

Energy Consumers Relief Act of 2013

Date
July 31, 2013 (113th Congress, 1st Session)

Staff Contact
Emily Leviner

Floor Situation

On Wednesday, July 31, 2013 the House will begin consideration of H.R. 1582, the Energy Consumers Relief Act of 2013, under a rule.  H.R. 1582 was introduced on April 16, 2013 by Rep. Bill Cassidy (R-LA).  H.R. 1582 was marked up on July 16, 2013 and was ordered reported, as amended, by a vote of 25-18.[1]

Bill Summary

Prior to finalizing an energy-related rule estimated to cost more than $1 billion,[1] H.R. 1582 requires the Environmental Protection Agency (EPA) to submit to Congress a report containing the rule, its estimated costs and benefits, an estimate of when the benefits will be realized, and a description of the methodology used to develop the estimates.  The report must also estimate whether the rule would increase energy prices and describe how it would impact jobs.

H.R. 1582 also requires the Secretary of Energy to prepare an independent analysis of the rule to determine whether it would increase energy prices, impact fuel diversity, or adversely affect energy supply, distribution, or use.  If the Secretary determines that the rule would yield any of these results, he or she must consult with other relevant agencies[2] to determine whether the rule would cause significant adverse effects on the economy.  The determination must be published in the Federal Register.

H.R. 1582 prohibits the EPA from finalizing an energy-related rule estimated to cost more than $1 billion if the Secretary of Energy determines that the rule will cause adverse effects to the economy.  The bill is prospective, in that it does not apply to already finalized rules.


[1] Defined as an EPA rule that 1) “regulates any aspect of the production, supply, distribution, or use of energy or provides for such regulation by States or other governmental entities;” and 2) “is estimated by the Administrator of the [EPA] or the Director of the Office of Management and Budget to impose direct costs and indirect costs, in the aggregate, of more than [$1 billion].”  H.R. 1582, Sec. 4(2).

[2] H.R. 1582 requires the Secretary to consult with the EPA Administrator, the Secretary of Commerce, the Secretary of Labor, and the Administrator of the Small Business Administration.

Background

Since 2009, the Obama Administration has proposed or finalized thousands of pages of costly regulations, including many that impact the energy sector.[1]  “EPA currently has more significant regulatory actions under review with the Office of Management and Budget (OMB) than any other Federal agency.  OMB, moreover, has projected that nearly half the costs of new Federal regulations over the past decade come from EPA rules . . . .”[2]  In some cases, the regulations impose costs of more than $1 billion each.[3]  Collectively, their combined impact on energy costs and on the overall U.S. economy has the potential to be staggering.

A study supported by the National Association of Manufacturers found that of the many of EPA regulations proposed and finalized, the annual cost of complying with six key final or pending regulations—the Utility MACT, CSAPR, Boiler MACT, Coal Combustion Residuals, Cooling Water Intake Structures, and Ozone NAAQS rules—is estimated to reach as much as $111 billion each year, with upfront costs of more than half a trillion dollars.[4]  The same study projected that in a worst-case scenario, the six regulations could cut annual U.S. output by as much $630 billion and 4.2 percent of GDP, and result in the loss of more than 9 million jobs.[5]

In addition to increasing energy costs, EPA regulations may also adversely impact energy reliability.  For example, many coal-fired electric generating units are shutting down because of EPA’s costly regulations.  One study found that EPA regulations could lead to the retirement of 20% of the nation’s coal-fired generating capacity and could impose compliance costs on the electricity sector of $16 billion each year.[6]  As of July 2013, 294 units in 33 states were announced to be closing, at least in part, due to EPA policies.  These units represent over 41,000 megawatts of electricity.[7]


[1] See, e.g., James E. McCarthy & Claudia Copeland, EPA Regulations: Too Much, Too Little, or On Track? (Apr. 2013, Congressional Research Service); see also Major EPA Regulations Affecting Coal-Fueled Electricity, American Coalition for Clean Coal Electricity (May 2013).

[2] Committee Report 113-164 at 2.

[3] See House Energy and Commerce Committee MemorandumHearing on H.R. __, the “Energy Consumers Relief Act of 2013” (Apr. 2013) at 2.

[4] Nam D. Pham & Daniel J. Ikenson, A Critical Review of the Benefits and Costs of EPA Regulations on the U.S. Economy (Nov. 2012, ndp consulting) at 12. 

[5] Id. at 3.

[6] Committee Report 113-164 at 4.

[7] Id.

Cost

Based on CBO scoring, “implementing H.R. 1582 would cost $35 million over the 2014-2018 period, assuming appropriation of the necessary amounts.  Enacting H.R. 1582 would not affect direct spending or revenues; therefore, pay-as-you-go procedures do not apply.”

Amendments

1)         Rep. Waxman (D-CA) Amendment #10 – Amendment strikes section 2 of the bill, which allows DOE to effectively veto EPA rules.

2)         Rep. Hastings (D-FL) Amendment #4 – Amendment eliminates redundant Department of Energy oversight and analysis.

3)         Reps. Connolly (D-VA) and Kildee (D-MI) Amendment #7 – Amendment prevents Sec. 2 of the bill from applying to rules related to protecting air and water quality.

4)         Rep. Woodall (R-GA) Amendment #1 – Amendment requires EPA to make publicly available all data and documents relied upon by the Agency to develop estimates under the bill.

5)         Reps. Culberson (R-TX) and Hunter (R-CA) Amendment #2 – Prohibits the Environmental Protection Agency (EPA) from using the “social cost of carbon” formula in its benefits assessment of any energy-related rule that is estimated to cost more than $1 billion until the EPA promulgates a final rule on the social cost of carbon.

6)         Rep. Murphy (R-PA) Amendment #12 – Amendment prohibits the EPA from using the "social cost of carbon" valuation for any energy-related rule covered by this bill. On May 31, the Department of Energy announced a new rule using a speculative ‘social cost of carbon’ to estimate the economic impact of climate change between now and the year 2300.

Additional Information

For additional information, see the fact sheet on H.R. 1582 provided by the Committee on Energy and Commerce, and the Policy Feature Issue: EPA Regulations under President Obama provided by the House Republican Conference.

For questions or further information contact the GOP Conference at 5-5107.