[House Hearing, 113 Congress]
[From the U.S. Government Publishing Office]





       EPA'S PROPOSED CARBON DIOXIDE REGULATIONS FOR POWER PLANTS

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

                                HEARING

                               BEFORE THE

                    SUBCOMMITTEE ON ENERGY AND POWER

                                 OF THE

                    COMMITTEE ON ENERGY AND COMMERCE
                        HOUSE OF REPRESENTATIVES

                    ONE HUNDRED THIRTEENTH CONGRESS

                             SECOND SESSION

                               __________

                             JUNE 19, 2014

                               __________

                           Serial No. 113-155


      Printed for the use of the Committee on Energy and Commerce

                        energycommerce.house.gov

                                     ______
                                     
                    U.S. GOVERNMENT PUBLISHING OFFICE 

92-469 PDF                     WASHINGTON : 2015 
-----------------------------------------------------------------------
  For sale by the Superintendent of Documents, U.S. Government Publishing 
  Office Internet: bookstore.gpo.gov Phone: toll free (866) 512-1800; 
         DC area (202) 512-1800 Fax: (202) 512-2104 Mail: Stop IDCC, 
                          Washington, DC 20402-0001
                          
                          

                    COMMITTEE ON ENERGY AND COMMERCE

                          FRED UPTON, Michigan
                                 Chairman

RALPH M. HALL, Texas                 HENRY A. WAXMAN, California
JOE BARTON, Texas                      Ranking Member
  Chairman Emeritus                  JOHN D. DINGELL, Michigan
ED WHITFIELD, Kentucky               FRANK PALLONE, Jr., New Jersey
JOHN SHIMKUS, Illinois               BOBBY L. RUSH, Illinois
JOSEPH R. PITTS, Pennsylvania        ANNA G. ESHOO, California
GREG WALDEN, Oregon                  ELIOT L. ENGEL, New York
LEE TERRY, Nebraska                  GENE GREEN, Texas
MIKE ROGERS, Michigan                DIANA DeGETTE, Colorado
TIM MURPHY, Pennsylvania             LOIS CAPPS, California
MICHAEL C. BURGESS, Texas            MICHAEL F. DOYLE, Pennsylvania
MARSHA BLACKBURN, Tennessee          JANICE D. SCHAKOWSKY, Illinois
  Vice Chairman                      JIM MATHESON, Utah
PHIL GINGREY, Georgia                G.K. BUTTERFIELD, North Carolina
STEVE SCALISE, Louisiana             JOHN BARROW, Georgia
ROBERT E. LATTA, Ohio                DORIS O. MATSUI, California
CATHY McMORRIS RODGERS, Washington   DONNA M. CHRISTENSEN, Virgin 
GREGG HARPER, Mississippi            Islands
LEONARD LANCE, New Jersey            KATHY CASTOR, Florida
BILL CASSIDY, Louisiana              JOHN P. SARBANES, Maryland
BRETT GUTHRIE, Kentucky              JERRY McNERNEY, California
PETE OLSON, Texas                    BRUCE L. BRALEY, Iowa
DAVID B. McKINLEY, West Virginia     PETER WELCH, Vermont
CORY GARDNER, Colorado               BEN RAY LUJAN, New Mexico
MIKE POMPEO, Kansas                  PAUL TONKO, New York
ADAM KINZINGER, Illinois             JOHN A. YARMUTH, Kentucky
H. MORGAN GRIFFITH, Virginia
GUS M. BILIRAKIS, Florida
BILL JOHNSON, Ohio
BILLY LONG, Missouri
RENEE L. ELLMERS, North Carolina

                                 _____

                    Subcommittee on Energy and Power

                         ED WHITFIELD, Kentucky
                                 Chairman
STEVE SCALISE, Louisiana             BOBBY L. RUSH, Illinois
  Vice Chairman                        Ranking Member
RALPH M. HALL, Texas                 JERRY McNERNEY, California
JOHN SHIMKUS, Illinois               PAUL TONKO, New York
JOSEPH R. PITTS, Pennsylvania        JOHN A. YARMUTH, Kentucky
LEE TERRY, Nebraska                  ELIOT L. ENGEL, New York
MICHAEL C. BURGESS, Texas            GENE GREEN, Texas
ROBERT E. LATTA, Ohio                LOIS CAPPS, California
BILL CASSIDY, Louisiana              MICHAEL F. DOYLE, Pennsylvania
PETE OLSON, Texas                    JOHN BARROW, Georgia
DAVID B. McKINLEY, West Virginia     DORIS O. MATSUI, California
CORY GARDNER, Colorado               DONNA M. CHRISTENSEN, Virgin 
MIKE POMPEO, Kansas                      Islands
ADAM KINZINGER, Illinois             KATHY CASTOR, Florida
H. MORGAN GRIFFITH, Virginia         JOHN D. DINGELL, Michigan (ex 
JOE BARTON, Texas                        officio)
FRED UPTON, Michigan (ex officio)    HENRY A. WAXMAN, California (ex 
                                         officio)

                                  (ii)
                                  
                                  
                             C O N T E N T S

                              ----------                              
                                                                   Page
Hon. Ed Whitfield, a Representative in Congress from the 
  Commonwealth of Kentucky, opening statement....................     2
    Prepared statement...........................................     3
Hon. Henry A. Waxman, a Representative in Congress from the State 
  of California, opening statement...............................     4
Hon. Joe Barton, a Representative in Congress from the State of 
  Texas, opening statement.......................................    10
Hon. Bobby L. Rush, a Representative in Congress from the State 
  of Illinois, opening statement.................................    11
Hon. Fred Upton, a Representative in Congress from the State of 
  Michigan, prepared statement...................................    70

                               Witnesses

Janet McCabe, Acting Assistant Administrator, Office of Air and 
  Radiation, Environmental Protection Agency.....................    12
    Prepared statement...........................................    15
    Answers to submitted questions...............................    81

                           Submitted Material

Report of June 2014, ``The Clean Air Act's Track Record: Clean 
  Air and Economic Growth,'' committee Democratic staff, 
  submitted by Mr. Waxman........................................     6
Letter of June 18, 2014, from American Lung Association, et al., 
  to Senators and Representatives, submitted by Mrs. Capps.......    40
Statement of June 19, 2014, American Forest & Paper Association 
  and American Wood Council, submitted by Mr. Griffith...........    72
Report, ``A Legislative History of the Clean Air Act Amendments 
  of 1990,'' Volume I, Book 2, Chapter 2 excerpts, submitted by 
  Mr. Whitfield..................................................    75

 
       EPA'S PROPOSED CARBON DIOXIDE REGULATIONS FOR POWER PLANTS

                              ----------                              


                        THURSDAY, JUNE 19, 2014

                  House of Representatives,
                  Subcommittee on Energy and Power,
                          Committee on Energy and Commerce,
                                                    Washington, DC.
    The subcommittee met, pursuant to call, at 9:31 a.m., in 
room 2123, Rayburn House Office Building, Hon. Ed Whitfield 
(chairman of the subcommittee) presiding.
    Members present: Representatives Whitfield, Shimkus, Pitts, 
Terry, Burgess, Latta, Cassidy, Olson, McKinley, Gardner, 
Pompeo, Kinzinger, Griffith, Barton, Upton (ex officio), Rush, 
McNerney, Tonko, Yarmuth, Engel, Green, Capps, Doyle, Barrow, 
Matsui, Castor and Waxman (ex officio).
    Staff present: Nick Abraham, Legislative Clerk; Gary 
Andres, Staff Director; Charlotte Baker, Deputy Communications 
Director; Leighton Brown, Press Assistant; Allison Busbee, 
Policy Coordinator, Energy and Power; Annie Caputo, 
Professional Staff Member; Patrick Currier, Counsel, Energy and 
Power; Tom Hassenboehler, Chief Counsel, Energy and Power; Ben 
Lieberman, Counsel, Energy and Power; Brandon Mooney, 
Professional Staff Member; Mary Neumayr, Senior Energy Counsel; 
Graham Pittman, Staff Assistant; Chris Sarley, Policy 
Coordinator, Environment and the Economy; Peter Spencer, 
Professional Staff Member, Oversight; Tom Wilbur, Digital Media 
Advisor; Jean Woodrow, Director of Information Technology; Jeff 
Baran, Democratic Staff Director, Energy and the Environment; 
Phil Barnett, Democratic Staff Director; Caitlin Haberman, 
Democratic Policy Analyst; Bruce Ho, Democratic Counsel; 
Elizabeth Letter, Democratic Press Secretary; Karen Lightfoot, 
Democratic Communications Director and Senior Policy Advisor; 
and Alexandra Teitz, Democratic Chief Counsel, Environment and 
Energy.
    Mr. Whitfield. I would like to call the hearing to order 
this morning, and today we will be discussing EPA's proposed 
regulations targeting carbon dioxide emissions from existing 
electric power plants, which was proposed on June 2nd.
    Before I recognize myself for an opening statement, I want 
to welcome Ms. McCabe. We appreciate her being with us this 
morning.
    It is also my understanding that we have a number of 
interns here today, some from offices here in the Congress, but 
I know we have quite a few also from EPA, so we welcome the EPA 
interns as well as the interns from Capitol Hill. And with 
that, I will recognize myself for a 5-minute opening statement.

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

    Ms. McCabe, we are delighted that you are here today. All 
of us view this as a significant, in many ways unprecedented, 
regulation, and pursuant to the Constitution, I can assure you 
that Congress is going to do its role and look very closely at 
this over 600-page regulation that would dramatically change 
the way electricity is produced in America.
    And it is certainly a lot more than about coal. This is one 
of those regulations that will affect every person in America, 
whether it be a manufacturing plant, electric generator, a 
consumer of electricity, or whatever it might be, so we--and 
this will be the first of many hearings on this regulation.
    Now, this proposal looks similar to the cap-and-trade 
legislation that the Obama administration advocated for a long, 
long time. They attempted to pass it in 2009. It passed the 
House, but it was not successful in passing the Senate. Now, 
the President, as he has said, is going to act unilaterally, 
and he has directed EPA to set rules and regulations that are 
essentially, and many of us believe, the majority of us believe 
on this committee, at least, they are unworkable and will not 
even have an impact on our future emissions of greenhouse gases 
or affect global temperatures.
    Former EPA Administrator Lisa Jackson confirmed this when 
she testified before this subcommittee: We will not ultimately 
be able to change the amount of CO2 that is 
accumulating in the atmosphere alone. And then the EPA 
Administrator Gina McCarthy summed up the views of this 
administration when she testified before this subcommittee, 
saying that EPA does not measure whether its regulations and 
the tens of billions of dollars spent by the administration 
will actually affect future climate change. It is simply part 
of an overall strategy to demonstrate the President's global 
leadership. So these actions appear to be about removing coal 
as an energy source in America and promoting President Obama's 
leadership perception in the international community.
    Now, beyond the President's unwillingness to listen to the 
American people, this proposal raises serious policy and legal 
questions. EPA has never been this extreme under 111(d) before. 
Instead of the States establishing a performance standard for 
units within the source category, EPA is now dictating to the 
States the level of emission reductions that each State must 
make, so statewide rather than individual units. In essence, 
they are requiring the States to alter the way in which 
electricity utility systems make power, and in our experience 
with oversight of this agency, the proposed rule rarely changes 
significantly before it is finalized, so we are talking about a 
proposed rule that was just introduced a few--a couple of weeks 
ago, but our experience is that even after the comment period, 
that rule really becomes final.
    Now, the original Clean Air Act respected the appropriate 
role for States and local governments. In fact, the statute 
begins with the congressional finding that air pollution 
prevention is the primary responsibility of State and local 
governments. This policy is also reflected in the language of 
section 111(d), which has previously been used by EPA in a very 
limited and very deferential manner. But with this proposed 
rule, as I said earlier, EPA appears to be casting aside all 
precedent and expansively interpreting its authority under this 
section as a justification to force States to redesign their 
electricity-generating systems even though two previous EPA 
Administrators have said it will not have any impact on global 
warming.
    So, is this a power grab? It seems to demonstrate once 
again that this administration is getting the reputation that 
we hear repeatedly of being a unilateralist; that the President 
will decide what is best for America as he did when he went to 
the Copenhagen conference in 2009 and unilaterally committed 
America to certain emissions without discussing it with the 
Congress, without discussing it with job creators.
    So we welcome this opportunity to talk to you in depth 
about this proposal, and thank you again for being with us.
    [The prepared statement of Mr. Whitfield follows:]

                Prepared statement of Hon. Ed Whitfield

    This morning we will be discussing EPA's proposed 
regulations targeting carbon dioxide emissions from existing 
electric power plants. On June 2nd the long-anticipated carbon 
dioxide regulations for existing power plants were proposed.
    This is the first opportunity Congress has had to hear 
directly from the agency exactly why it thinks it can issue 
this proposal, what it thinks the proposal should do, how the 
proposal will be implemented, and what it will accomplish. And 
I welcome our witness, Janet McCabe, EPA Acting Assistant 
Administrator for Air and Radiation, who has come to explain 
the rule and answer our initial questions today. This will not 
be our only opportunity to take testimony on the proposal or to 
hear from the agency. This is just the beginning of what we can 
assure to be a deliberate, careful oversight of the agency's 
regulatory action.
    I have strong concerns at the outset that this proposal 
looks very similar to the cap-and-trade legislation the Obama 
administration tried to ram through Congress in 2009. Now, the 
President is acting unilaterally in directing the EPA to set 
rules and regulations that are essentially unworkable and will 
not even have an impact on our future emissions of greenhouse 
gases or global temperatures. Former EPA Administrator Lisa 
Jackson confirmed this when she testified before this 
subcommittee and said ``We will not ultimately be able to 
change the amount of CO2 that is accumulating in the 
atmosphere alone.''
    And, EPA Administrator Gina McCarthy also summed up the 
views of this administration when she testified before this 
subcommittee saying, that her agency (EPA) does not measure 
whether its regulations and the tens of billions of dollars 
spent by the administration will actually affect future climate 
change, it is simply part of an ``overall strategy'' to 
demonstrate global leadership. These actions are all in an 
effort to destroy coal as an energy source in America and 
become a ``leader'' in the international community.
    Beyond the President's unwillingness to listen to the 
American people, this proposal raises serious policy and legal 
questions. This proposal is like nothing EPA has ever proposed 
before as a performance standard--even more so than any of the 
agency's controversial actions targeting the Nation's coal-
based electricity generators. Instead of calling on the States 
to establish a performance standard for units within the source 
category, it appears that EPA is dictating to the States the 
levels of emissions reductions that each State must make, in 
essence proposing to require States to alter the way in which 
their electric utility systems make power. And, in our 
experience with oversight of this agency, the proposed rule 
rarely changes significantly before it is finalized.
    In its rollout of this proposal, the EPA has repeatedly 
emphasized the rule's ``flexibility.'' What EPA describes as 
flexibility is really the agency giving itself arbitrary 
authority to regulate electricity generation and use as it sees 
fit. We don't know for certain what this proposal would require 
of Kentucky and other States, but we do know that EPA will make 
the final decisions in approving or denying each State's 
implementation plans. Further, EPA has made clear in their 
proposal that ``[o]nce the final goals have been promulgated, a 
State would no longer have an opportunity to request that the 
EPA adjust its CO2 goal.'' And all of this 
regulatory control would be coming from an agency that has no 
energy policy-setting authority whatsoever, no energy-planning 
expertise, and no real accountability should things go badly 
for the citizens of these States.
    The original Clean Air Act respected the appropriate role 
for State and local governments. In fact, the statute begins 
with the Congressional finding that air pollution prevention is 
the primary responsibility of State and local governments. This 
philosophy is also reflected in the language of section 111(d), 
which has previously been used by EPA in a very limited and 
deferential manner. But with this proposed rule, EPA appears to 
be casting aside all precedent and expansively interpreting its 
authority under this section as a justification to force States 
to redesign their electricity systems.
    Coal faces a devastating one-two punch from EPA. First, the 
proposed New Source Performance Standards for electric 
generating units have all but outlawed new and more efficient, 
state-of-the-art coal-fired capacity. And with this new 
proposed rule, the agency can begin shuttering existing coal 
facilities. EPA implies that a coal unit can become 6 percent 
more efficient, but there are many doubts about the real world 
achievability of this figure. There are also doubts about EPA's 
assumptions that States can simply shift away from using that 
coal plant to using natural gas, nuclear or renewables, because 
many States such as Kentucky rely on coal to generate over 90 
percent of our electricity and do not have an abundance of 
resources to rely on. But, if coal can no longer be a 
significant part of a diverse energy supply, it will be the 
customers and the business community who will feel the very 
serious implications that these regulations will have for 
electricity affordability and reliability.
    There are a great many questions and concerns about this 
proposed rule. And, I said, today is only the subcommittee's 
first step in its examination of EPA's actions and of potential 
consequences of this administration's plans. We look forward to 
the testimony of the Acting Assistant Administrator Janet 
McCabe and we hope to learn more about what this rule really 
means for our country.

    Mr. Whitfield. And at this time I would like to recognize 
the gentleman from California for his 5-minute opening 
statement. Mr. Waxman.

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

    Mr. Waxman. Thank you, Mr. Chairman.
    On June 2nd, Administrator McCarthy released a central 
piece of President Obama's Climate Action Plan: proposed carbon 
pollution limits on power plants. In time historians may 
identify this as the moment that America got serious about 
tackling climate change.
    We know that carbon pollution from fossil fuels is 
accumulating in the atmosphere, trapping more heat and warming 
the climate. We are experiencing the result all around us in 
every part of the country. We also know that power plants are 
our largest source of carbon pollution, yet today there are no 
limits at all on the amount of carbon pollution they can emit.
    The good news is that there are many cost-effective ways to 
reduce the pollution. As the proposed rule demonstrates, the 
power plants can operate more efficiently, production can shift 
from the dirtiest and oldest coal-fired plants to modern 
natural gas plants, retirements of nuclear power plants can be 
postponed, investments can be made in clean renewable energy, 
and we can all contribute by becoming more energy efficient. 
The path outlined in the proposal is the path to cleaner air, 
better health, a safer climate, and a stronger economy. If we 
make these investments in cleaner energy, the United States can 
be the world leader in the industries of the future. That is 
not just a perception; that can be a reality.
    But you would never know that from the House Republicans. 
They are using the same scare tactics that opponents of clean 
air have always used. The fossil fuel industry and House 
Republicans have a credibility problem when it comes to claims 
about the economic impacts of the Clean Air Act. I have been in 
Congress for almost 40 years, and for 40 years industry has 
made doomsday claims that clean air regulations would shut down 
businesses, destroy jobs, drive prices skyward, and cripple 
economic growth, and they have been wrong every time. This 
morning I released a fact sheet that documents some of these 
inaccurate claims, and, Mr. Chairman, I ask that this be made 
part of the record.
    Mr. Whitfield. Without objection.
    [The information follows:]
    
    [GRAPHIC] [TIFF OMITTED] 
    
    Mr. Waxman. In 1990, when Congress last amended the Clean 
Air Act, electric utilities widely overestimated the cost of 
acid rain controls under a cap-and-trade program that we 
adopted, and which has been tremendously successful. They 
projected allowance prices of 1,000 to $1,500 per ton. The 
actual prices were less than $150 per ton.
    Ford Motor Company testified that, quote, ``we just do not 
have the technology to comply,'' end quote. Not even with 
technology, quote, ``on the horizon,'' end quote. In fact, the 
industry began making vehicles that met the new standards in 
just 3 years. Dupont testified that the provisions to protect 
the ozone layer would cause, quote, ``severe economic and 
social disruption,'' end quote, while Mobil Corporation 
predicted that the requirements for reformulated gasoline would 
cause, quote, ``major supply disruptions,'' end quote.
    Well, these dire predictions never happened. Today House 
Republicans claim that the Clean Power Plan will cause a surge 
in electricity bills and effectively end coal use in America. 
This is just the same old scare tactic. We heard that it is not 
enough to deal with the climate change problem. Well, it is not 
in and of itself, but you don't take the--you don't refuse to 
take a step in that direction because you haven't taken all the 
steps yet.
    We have air pollution reductions at the State and local 
level. That is the way the Clean Air Act has always worked 
under the EPA rules. The Clean Power Plan is eminently 
reasonable and achievable. It gives the States the flexibility 
to choose how to achieve the reductions. The goals are State-
specific and cost-effective. Polls show the public supports 
proposals by large majorities.
    It is time for this committee to stop its partisan 
obstruction. If my Republican colleagues have a better idea for 
protecting our planet for our children and grandchildren, they 
should speak up, but just saying no, shortchanging American 
ingenuity and condemning the next generation to a world wrecked 
by heat waves, droughts, wildfires, and extreme storms is not 
an option. If you have another idea, let us hear it, but all we 
hear from Republicans is, there is no problem, this is not 
enough to solve it, we shouldn't do anything at all, and that 
is why I am supporting the President's plan.
    Mr. Whitfield. The gentleman's time is expired.
    I might respectfully say to the gentleman that we did 
present what we viewed as a better plan, the Manchin-Whitfield 
bill, that passed the House of Representatives with a large 
margin of victory.
    Mr. Waxman. Mr. Chairman, if you would yield to me, that 
plan simply said EPA may not act.
    Mr. Whitfield. No, it did not say that. It said EPA could 
set the standard for existing plants, that Congress would set 
the effective date, and it also set a standard for now coal-
powered plants. But anyway, we did submit a proposal. It is 
waiting in the U.S. Senate for action now and----
    Mr. Waxman. Do you think that will solve the problem of 
greenhouse gases?
    Mr. Whitfield. You said we are not submitting a proposal. 
That was one of our proposals.
    Mr. Waxman. Did your proposal accomplish solving the 
problem?
    Mr. Whitfield. We feel quite confident--by the way, our 
energy emissions are the lowest today they have been in 20 
years, and our Manchin-Whitfield bill would even be--make it 
even better.
    At this time I would like to--the gentleman from Michigan 
Mr. Upton, chairman of the full committee, is not here, so I am 
going to recognize Mr. Barton of Texas, and if he does not 
utilize all of his time, if he wants to yield to someone else, 
that would be great.
    Mr. Barton. Does the chairman know if there are other 
Members on our side that wish time?
    Mr. Whitfield. Is there anyone that would like time? You 
want any time, Mr. Shimkus?
    OK. All right. Then I will recognize the gentleman from 
Texas, Mr. Barton, for 5 minutes.

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

    Mr. Barton. Well, thank you.
    Mr. Chairman, members of committee, and our witness and 
folks in the audience, one could argue that the audacity of 
this proposal is so breathtaking that--in and of itself, it is 
a health hazard because it literally takes my breath away 
that--what they have proposed.
    In the case of my State, Texas, if Texas were to implement 
this in its entirety between 2012 and 2030, we would have to 
reduce CO2 emissions by 41 percent. Forty-one 
percent. We would also, in terms of the national total, have to 
reduce CO2 emissions--our CO2 emissions 
would be 25 percent of the national total in one State.
    Now, I understand that Texas is somewhat unique because we 
still are creating jobs in our State. We still have an economy 
that is growing. In fact, over half of all the net new jobs 
created in the country in the last 10 years have been created 
in Texas. Most people think that is a good thing, but 
apparently the Obama administration thinks that is a bad thing, 
so it is punitive in its nature.
    As Chairman Whitfield has pointed out, there are no health 
claims. There is nobody claiming that this actually improves 
the public health, which is the number one goal of the Clean 
Air Act. There is no net environmental benefit. Even if one 
were to be a global warming believer, which I am not, this 
doesn't allege or--that there are any net benefits to changing 
global warming.
    What it is is an exercise in political arrogance that the 
EPA has the power, I believe, and that is debatable, under the 
Clean Air Act. All these power plants that are currently in 
operation are regulated under section 112 of the Clean Air Act. 
This claims that we can now regulate those same power plants 
that are already regulated under section 111(d). That is a 
questionable legal standing, and I believe that the courts will 
overturn this proposed regulation, if it comes to that, on that 
basis alone.
    My good friend from California in his opening statement 
referred to carbon pollution. Well, actually what this is, what 
we are regulating, is CO2, carbon dioxide, which I 
am creating as I speak, and which every person in this room is 
creating as you breathe in and out. Now, I don't know about the 
rest of the people, but I don't believe everybody that is alive 
and breathing is a CO2 mobile source polluter. That 
may be the stance of the Obama administration, but it is 
certainly not my stance.
    So, calling CO2 to be pollution doesn't make it 
so. I could call Mr. Waxman a conservative, but that would not 
make him a conservative; or he could call me a liberal, but 
that would not make me a liberal.
    Mr. Chairman, we need to seriously review this proposal, 
and I think, as the subcommittee does, and, if necessary, the 
full committee does, we will come to the conclusion that this 
is more of a political proposal than it is an environmental 
proposal. And again, I pointed out Texas has to reduce its 
CO2 emissions from the baseline of 2012 by 41 
percent; Louisiana, 50 percent; Florida, 28 percent; 
Pennsylvania, 25 percent; Arizona, 45 percent; Oklahoma, 40 
percent; Illinois, 20 percent; New York, 49 percent; Alabama, 
24 percent; Arkansas, 46 percent.
    What is glaring about this list, and that is the top 10 
States, the State with the greatest population base and the 
State with the largest environmental problems, at least in the 
Los Angeles Basin, the Golden Gate State of California is not 
even on the top 10 list, and they are the number one State in 
terms of population.
    So I could go on and on, Mr. Chairman, but I have only got 
29 seconds. Simply let me say that we have great respect for 
the EPA. I voted for the Clean Air Act amendments in the early 
1990s. This proposal does not comport with my understanding of 
what the Clean Air Act amendments were when we passed them in 
this committee over 20 years ago.
    With that, I would yield back to the chairman.
    Mr. Whitfield. The gentleman yields back, and at this time 
recognize the gentleman from Chicago, Ranking Member Mr. Rush, 
for his 5-minute opening statement.

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

    Mr. Rush. I want to thank you, Mr. Chairman, for this 
important hearing on the EPA's clean power rule. As part of 
President Obama's climate action plan to cut carbon pollution 
and help mitigate the disastrous effects of climate change, 
this rule would allow EPA to use its existing authority under 
the Clean Air Act to control carbon pollution from existing 
fossil fuel-fired power plants.
    And, Mr. Chairman, I must say that this rule cannot be more 
timely as these power plants account for the largest source of 
greenhouse gases from stationary sources in this country, and 
they are responsible for about one-third of the total U.S. 
greenhouse gas emissions with no current Federal limits on 
their emissions of carbon pollution.
    This new proposal seeks to cut emissions by 30 percent 
compared with the 2005 levels by 2030, and it gives States 
great flexibility with implementing the rule based on their 
existing utility infrastructure and policies.
    Mr. Chairman, while we hear from some industry groups and 
opponents of any type of regulation that these new rules will 
be costly and overburdensome, the newly released report by the 
Office of Management and Budget contradicts that claim. From 
the annual OMB reports to Congress, we know that for the 34 
major EPA rules issued between 2003 and 2013, the benefits have 
greatly exceeded the cost.
    In fact, Mr. Chairman, it was two rules issued under the 
George W. Bush administration, the clean air interstate rule 
issued in 2005 and the particle pollution rule issued in 2007, 
that brought about the highest estimated benefits.
    More importantly, the science, Mr. Chairman, is settled. 
Climate change is real, and it is negatively impacting the 
lives and livelihoods of the American people. You see this in 
extreme weather events and everything from extensive flooding 
on our coasts to relentless wildfires in the West, to costly 
drought and crop loss in the plains and in my beloved Midwest.
    That is why, Mr. Chairman, four former Republican U.S. EPA 
Administrators who served under Presidents Nixon, and Reagan, 
and George H.W. And George W. Bush all praised the agency's 
climate change rule in a Senate hearing just yesterday. As 
George W. Bush's first EPA Administrator Christine Todd Whitman 
told the Senate Clean Air and Nuclear Safety Subcommittee, and 
I quote, ``The issue has been settled. EPA does have the 
authority. The law says so; the Supreme Court has said so 
twice. That matter, I now believe, should be put to rest, Mr. 
Chairman,'' end of quote.
    The American people expect their legislators to address 
this serious threat not only to our environment, but to our 
national security. Even President Reagan's former EPA 
Administrator Lee Thomas agreed that the science is settled on 
this matter, telling the same panel just on yesterday, I quote, 
``We know that carbon dioxide and other greenhouse gases are 
warming the atmosphere. We know they have contributed to a more 
than 1.5 degree Fahrenheit rise in temperature,'' end of quote.
    Mr. Chairman, if Congress refuses to address this issue as 
the American people demand, at the very least we should allow 
EPA to do its rule, do its job, and act accordingly, then this 
rule will go a long way in helping us to begin to address this 
dire issue.
    I look forward to hearing from our witness today, and I 
yield back.
    Mr. Whitfield. Thank you, Mr. Rush.
    The gentleman yields back, his time is expired, and at this 
time I am going to recognize Ms. McCabe, because we are going 
to give her 5 minutes to give her views on this issue.
    And as I said in the beginning, we do look forward to your 
testimony and the opportunity to ask you questions. So, Ms. 
McCabe, you are recognized for 5 minutes.

  STATEMENT OF JANET MCCABE, ACTING ASSISTANT ADMINISTRATOR, 
  OFFICE OF AIR AND RADIATION, ENVIRONMENTAL PROTECTION AGENCY

    Ms. McCabe. Thank you, Chairman Whitfield and Ranking 
Member Rush.
    Mr. Whitfield. I am not positive that your microphone is 
on.
    Ms. McCabe. There we go.
    Thank you, Chairman Whitfield, Ranking Member Rush, members 
of the subcommittee. Thank you for the opportunity to testify 
today on EPA's recently issued Clean Power Plan proposal.
    Climate change is one of the greatest challenges of our 
time. It already threatens human health and welfare and 
economic well-being, and if left unchecked, it will have 
devastating impacts on the United States and on the planet. The 
science is clear, the risks are clear, and the high costs of 
inaction are clear. We must act. That is why President Obama 
laid out a Climate Action Plan, and why on June 2nd the 
Administrator signed the proposed Clean Power Plan to cut 
carbon pollution, build a more resilient Nation, and lead the 
world in our global climate fight.
    Power plants are the largest source of carbon dioxide 
emissions in the United States, accounting for roughly one-
third of all domestic greenhouse gas emissions. While the 
United States has limits in place for the level of arsenic, 
mercury, sulfur dioxide, nitrogen oxides, and particle 
pollution that power plants can emit, there are currently no 
national limits on carbon pollution levels.
    EPA's proposed Clean Power Plan will cut hundreds of 
millions of tons of carbon pollution and hundreds of thousands 
of tons of other harmful air pollutants from existing power 
plants. Together these reductions will provide important health 
benefits to our most vulnerable citizens, including our 
children.
    The Clean Power Plan is a critical step forward. Our plan 
is built on advice and information from States, cities, 
businesses, utilities and thousands of people about the actions 
they are already taking to reduce carbon dioxide emissions.
    The plan aims to cut energy waste and leverage cleaner 
energy sources by doing two things. First, it uses a national 
framework to set achievable State-specific goals to cut carbon 
pollution per megawatt hour of electricity generated; and 
second, it empowers the States to chart their own customized 
path to meet their goals.
    We know that coal and natural gas play a significant role 
in a diverse national energy mix. This plan does not change 
that. It builds on action already under way to modernize aging 
plants, increase efficiency, and lower pollution, and paves a 
more certain path for conventional fuels in a clean energy 
economy.
    The EPA's stakeholder outreach and public engagement in 
preparation for this rule was unprecedented. Starting last 
summer, we held 11 public listening sessions around the 
country. We participated in hundreds of meetings with a broad 
range of stakeholders across the country and talked with every 
single State.
    Now, the second phase of our public engagement has begun. 
We have already had dozens of calls with States and other 
stakeholders, and the more formal public process, both a public 
comment period and public hearings, will provide further 
opportunity for stakeholders and the general public to provide 
input. These are not mere words. That is a proposal, and we 
want and need input from the public. That is why we have 
already engaged States, utilities, and other stakeholders to 
get their feedback.
    To craft State goals, we looked at where States are today, 
and we followed where they are going. Each State is different, 
so each goal and each path can be different. The goals spring 
from smart and sensible opportunities that States and 
businesses are taking advantage of right now.
    Under the proposal, the States have a flexible compliance 
path that allows them to design plans sensitive to their needs, 
including considering jobs and communities in a transitioning 
energy world. It allows them enough time, 15 years from when 
the rule is final until compliance with the final target, to 
consider and make the right investments, ensure reliability, 
and avoid stranded assets.
    Our plan doesn't just give States more options, it gives 
entrepreneurs and investors more options, too, by unleashing 
the market forces that drive innovation and investment in 
cleaner power and low-carbon technologies.
    All told, in 2030, when States meet their goals, there will 
be about 30 percent less carbon pollution from the power sector 
across the U.S. when compared to 2005 levels, 730 million 
metric tons of carbon dioxide out of the air. In addition, we 
will cut pollution that causes smog and soot by 25 percent. The 
first year that these standards go into effect will avoid up to 
100,000 asthma attacks and 2,100 heart attacks, and the numbers 
go up from there.
    In 2030, the Clean Power Plan will deliver climate and 
health benefits of up to $90 billion, and for soot and smog 
reductions alone, that means for every dollar we invest in the 
plan, families will see $7 in health benefits. And because 
energy efficiency is such a smart, cost-effective strategy, we 
predict that in 2030, average electricity bills for American 
families will be 8 percent cheaper.
    President Obama's Climate Action Plan provides a roadmap 
for Federal action to meet the pressing challenge of a changing 
climate, promoting clean energy solutions that capitalize on 
American innovation and drive economic growth in providing a 
role for a range of fuels, including coal and natural gas. The 
proposal sets targets and a reasonable schedule that can be 
achieved by every State using measures they choose themselves 
to suit their own needs.
    The EPA looks forward to discussion of the proposal over 
the next several months, and I look forward to your questions. 
Thank you.
    [The prepared statement of Ms. McCabe follows:]
    
    [GRAPHIC] [TIFF OMITTED] 
    
    Mr. Whitfield. Well, Ms. McCabe, thank you so much again.
    And I neglected to mention that she is the Acting Assistant 
Administrator over at EPA, and so we do appreciate your being 
here.
    At this time I would like to recognize myself for 5 minutes 
of questions and statements. I have noticed, Ms. McCabe, that 
sometimes when we have our question period, we oftentimes make 
statements, so I will probably do a little bit of both.
    The first thing I wanted to do, I want to read a statement 
by a former IPCC coordinating lead article coordinator. His 
name is Dr. Stephen Schneider. Of course, that is the 
International Panel on Climate Change, which I think is 
recognized as the world leader in this issue of climate change. 
But Dr. Schneider made this statement. He said, on one hand, as 
scientists, we are ethically bound to the scientific method, in 
effect promising to tell the truth, which means we must include 
all the doubts, the caveats, the ifs, and the buts. On the 
other hand, we are human beings, and we want a better world, 
and to do that, we must have media support, so we must offer up 
scary scenarios, make dramatic statements, and do not mention 
any scientific doubt. And then he concluded by saying, so we 
decide what must be done to be most effective in getting our 
message out.
    And I say that because you were really positive in your 
statement, and it is our responsibility to raise doubts about 
these kinds of regulations that have such an impact everywhere. 
And so I just wanted--Dr. Schneider is not the only lead 
coordinator that has made these statements. Others have said we 
have to make them dramatic to put political pressure on 
political leaders. Others have said we use the worst-case model 
scenarios.
    So, as I said in the beginning, our responsibility is to 
try to focus in and see really what is going on here. And so 
the first question I would like to ask you this morning, I 
touched on it in my opening statement, EPA's carbon dioxide 
regulations for power plants are being pursued under section 
111(d), and it is my understanding that you all issued 
regulations under that section on five occasions. And now 
section 111(d) has traditionally focused, and, in fact, of 
those five times it has always focused, on emissions standards 
for specific sources, specific units, and it has never been 
attempted to do it in a statewide way, and that is what your 
recent proposal does. It sets a standard that can be achieved 
only statewide.
    What precedent under section 111(d) is there for this type 
of standard setting which has never been done before?
    Ms. McCabe. There actually have been six regulations issued 
under 111(d), the last one being the clean air mercury rule in 
2005, which addressed this sector, and that took an approach 
that allowed utilities to trade among themselves to reduce 
emissions. But the fact is that what we have done in this rule 
is completely within the four corners of 111(d), which directs 
us to identify the best system of emission reduction that has 
been adequately demonstrated for the particular sector that we 
are looking at. And in the case of the power sector, it is a 
fully integrated system that encompasses the kinds of 
technologies that we included in the rule, and we know that 
because that is what we heard from States and utilities. These 
are the things they are already doing to reduce carbon from 
fossil power plants.
    Mr. Whitfield. But, you know, in this rule, you, for the 
first time--I mean, you basically are directing the States on 
setting up renewable mandates. You are setting the efficiency 
of the coal plants. You are determining the natural gas 
capacity, what percent of the capacity must be run. You are 
setting consumer demand. You are going further than you have 
ever done before, in my opinion.
    Ms. McCabe. We are not actually setting any mandates in the 
rule.
    Mr. Whitfield. But you set this out in the regulation.
    Ms. McCabe. But they are not mandates. The States have 
absolute flexibility to use whatever method----
    Mr. Whitfield. Don't they have to meet those four 
standards?
    Ms. McCabe. They do not have to meet those four standards. 
Those were the----
    Mr. Whitfield. You have to meet--they have to meet your 
target, though.
    Ms. McCabe. They have to meet the overall carbon intensity 
target, but they have complete flexibility to get there however 
they choose, which is what they told us they wanted.
    Mr. Whitfield. We are going to explore it some more, but I 
have 15 seconds left. I want to ask one other questions. One of 
the real concerns we have--now, this relates to the new power 
plant rule. We can't build a new plant in America because the 
technology is not there that commercially makes it feasible. 
The Kemper plant in Mississippi is like a $5 billion cost 
overrun. In Europe, they are closing down natural gas plants. 
They are mothballing them because natural gas prices are so 
high coming out of Russia, so they are building new coal-
powered plants, and last year they imported 53 percent of our 
coal exports.
    So they have the flexibility, if gas prices go up, to build 
a new plant. We don't have that flexibility. Do you think that 
that is fair to the American people?
    Ms. McCabe. I actually disagree respectfully, Chairman. We 
think that new coal plants can be built under the new rule, and 
they are going forward.
    Mr. Whitfield. At this time I would like to recognize the 
gentleman from Illinois, Mr. Rush, for his 5-minute opening 
statement.
    Mr. Rush. Thank you, Mr. Chairman. I want to commend Ms. 
McCabe, I want to commend the EPA, I want to commend all your 
colleagues for the way you have approached this proposal. I 
think that you have been extremely open during this process of 
creating this proposal, and from what I hear today, that this 
process has not concluded, that there will be more and more 
opportunities for States and stakeholders to add their voices 
and to look at this proposal and to engage in positive 
commentaries with you on this proposal. You already reached out 
and asked for suggestions and been guided by that feedback.
    I am from the Midwest, and we get a lot of our electricity 
from coal. We have a higher climate pollution, rates are--at 
the beginning, starting out at the gate, but also means that we 
have more opportunities for cost-effective reductions.
    And I want you, if you would, explain to me and to others 
in more detail how you develop the States' goals, particularly 
for the Midwest, and how the different situations and the 
different States are reflected in the individual State goals.
    Ms. McCabe. That is a very good question, Congressman Rush, 
and one that we have been getting a lot from people, and it 
really goes back to the fundamental approach that we took in 
this rule, which is to take every State from where it started. 
One of the loudest things that we heard from States was please 
don't do a one-size-fits-all, every plant across the country 
has to meet a certain emission limit. Give us flexibility and 
recognize that States are in different places in terms of their 
energy mix, the age of their plants, and all that sort of 
thing. So that is the approach that we took.
    We looked across the whole country at the power sector, and 
we looked at the things that people were already doing, and 
there are many things that can be done to reduce carbon from 
the existing fleet, but we found four that were the most 
prominent and the most promising, we thought, to satisfy the 
standard of best system of emission reduction. And those things 
are let's have the coal and gas plants be as absolutely 
efficient as they can be so that we get every--we get every 
electron, as many electrons as possible for every ton of coal 
that is burned, and we found that a lot of efficiency 
improvements are being made across the country.
    We then looked at what else are States and utilities doing 
to reduce their carbon intensity. Well, they are using their 
gas plants more than their coal plants, and that is due to a 
lot of reasons, but it results in less carbon, so that was 
number two.
    Number three was that States all across the country are 
looking at increasing the amount of energy they get from 
renewable sources, from zero-carbon-emitting sources, and that 
is a very positive trend being pursued by a lot of people. So 
that was our third element.
    And fourth was the great interest across the country, in 
almost every State, to employ energy efficiency or demand sites 
so that we are more efficient. We know there is many, many ways 
to waste less energy, and all of these things are important in 
order to bring carbon down, as well as other pollutants.
    So we came up with a national framework that set a 
reasonable and moderate expectation for each of those four, 
recognizing that those were not the only things that States 
could do. And we then looked at every State, and we took the 
most recent information that we had for the power sector, which 
was 2012, and we applied those four building blocks, we call 
them, to each State, and that generated a carbon intensity rate 
that, if those were applied, that is where that State would 
get. And these are things that we think are very reasonable to 
achieve.
    Mr. Rush. Thank you. Thank you very much.
    My constituents, when they heard about this proposed rule, 
the thing that was most important in their mind was the price 
of electricity. My friends on the other side here, they have 
been engaged in a lot of fear mongering about the cost of 
electricity is going to increase and be unaffordable by low-
income constituents. And my question to you is how will the 
Clean Power Plan affect the electricity bills for my 
constituents?
    Ms. McCabe. Well, the first and most important thing to say 
is that each State will be in charge of designing its own plan, 
so that means two things. One is that they will have the 
opportunity to take those kind of considerations into--build 
those into their plan, but also that EPA at this moment can't 
predict exactly what every State is going to do.
    We did do some illustrative examples of what States might 
do, and so in our regulatory impact assessment, we do include 
those numbers, and that we show that with the significant 
increase in energy efficiency that will be implemented as a 
result of the rule, that electricity bills in 2030, we predict, 
will go down because--electricity bills--because people will be 
using less energy. We also show that the price of electricity 
will go up a little bit, but overall, bills will come down.
    I also just want to note that low-income families are most 
at risk of the adverse effects of carbon pollution and climate 
change and can greatly--will greatly benefit from the health 
benefits that will be achieved by this rule.
    Mr. Whitfield. Gentleman's time is expired.
    Mr. Rush. Thank you, Mr. Chairman.
    Mr. Whitfield. At this time I recognize the chairman of the 
full committee, Mr. Upton of Michigan, for 5 minutes.
    Mr. Upton. Thank you, Mr. Chairman.
    Ms. McCabe, I believe a number of us have concerns with 
this proposed rule. EPA, an agency with no energy policy 
authority or expertise, and under questionable statutory 
interpretation, has now placed itself above State Governments 
and public utility commissions on electric-generation issues, 
not to mention, DOE, FERC, or other Federal agencies. Last 
month the DC Circuit ruled that absent, and I quote, ``clear 
and specific grant of jurisdiction,'' end quote, the Federal 
Government cannot regulate areas of the electricity market left 
by the Federal Power Act to the States, like electricity 
generation and intrastate transmission. But what EPA calls 
flexibilities in its proposed reg, changing dispatch rules, 
mandating efficiency, utilizing other generation sources, are, 
in fact, the very intrastate generation transmission and 
distribution matters explicitly reserved by the Federal Power 
Act for the States.
    So where do you see specifically the clear and specific 
grant of jurisdiction over intrastate electricity matters? 
Where is the cite that you can refer to?
    Ms. McCabe. Chairman Upton, this is not an energy plan. 
This is a rule done within the four corners of 111(d) that 
looks to the best system of emission reduction to reduce 
emission. No State is required to enter into any particular 
agreement or take interstate efforts. We are not controlling 
the power sectors through this.
    Mr. Upton. So you don't have a specific cite, right? Is 
that right?
    Ms. McCabe. I can----
    Mr. Upton. Because neither DOE nor FERC has the authority 
to dictate how States plan and operate their energy systems, so 
if they can't do it, what authority does EPA have to mandate 
that the States actually restructure their electric systems and 
subject State energy decisions to Federal oversight and 
control?
    Ms. McCabe. That is not what the rule does. The rule is a 
pollution control rule, as EPA has traditionally done under 
section 111(d).
    Mr. Upton. Well, assuming that you had the legal authority 
to go forward with the rule, have you identified all the 
Federal and State agencies that would have to play a role in 
the redesign of the State electricity systems under the 
proposed rule?
    Ms. McCabe. We have been talking to many agencies at State 
and Federal level, but it is State Governments, as they always 
are with respect to 111(d) plans, that will be responsible for 
putting these plans together.
    Mr. Upton. So, as we look in EPA's budget, and this year 
EPA took a reduction in appropriation levels, an agreed-upon 
amount in a bipartisan way, from the CR that was passed 6 to 1 
last January, have you identified more funding of personnel 
that is going to be required at the Federal level to conduct 
this review and oversight for existing plants?
    Ms. McCabe. These are State plans. The States will put them 
together, and EPA will act in its traditional role with respect 
to State air quality planning.
    Mr. Upton. But you still got--you know, you have got the 
hammer to go after them, so are you--is it going to be a new--
new folks engaged in that?
    Ms. McCabe. We think States will want to take a leadership 
role on this and----
    Mr. Upton. What if they don't? I heard the West Virginia 
Governor saying that every utility in his State would be 
closed. Every coal-fired facility in his State was going to be 
closed.
    Ms. McCabe. Again, I think that States are going to want to 
be in the lead on this plan.
    Mr. Upton. I think I know where they want to be.
    Ms. McCabe. I also would suggest that our plan certainly 
does not require that all coal plants be closed in that State 
or any State.
    Mr. Upton. Well, I will leave that for Mr. McKinley to ask. 
I yield back.
    Mr. Whitfield. The gentleman yields back.
    At this time I would like to recognize the gentleman from 
California, Mr. Waxman, for 5 minutes.
    Mr. Waxman. Doesn't the EPA, under the Clean Air Act, set 
standards that States have to meet which affect their energy 
resources within that State?
    Ms. McCabe. To the extent that it addresses pollution 
emissions, yes.
    Mr. Waxman. So this is not unprecedented?
    Ms. McCabe. It is not.
    Mr. Waxman. OK. I understand EPA asked a lot of 
stakeholders for input. Did the States ask for greater 
flexibility, or did they argue that EPA should just tell them 
what to do?
    Ms. McCabe. They were very strenuously arguing for greater 
flexibility and, in fact, the ability to use some of the very 
tools that we have outlined in our proposal.
    Mr. Waxman. You indicated there are a number of ways that 
the States can meet the objective of reducing the carbon 
pollution coming from the power plants, and it is up to the 
States to design how to do it, but they have to achieve that 
goal.
    Ms. McCabe. Uh-huh.
    Mr. Waxman. This isn't a mandate from Washington, how to 
accomplish the goal. It sounds to me like a mandate from 
Washington to achieve the goal.
    Ms. McCabe. That is correct.
    Mr. Waxman. Isn't that the way the Clean Air Act has always 
worked since 1970?
    Ms. McCabe. With respect to 111(d) and some other elements 
of the Clean Air Act, that is exactly right.
    Mr. Waxman. The arguments I hear from the other side is, 
one, they don't believe the science; two, they don't think 
there is anything to do; three, this is not good enough because 
it doesn't achieve the goals; four, it tells the States what to 
do. Seems like every one of those points is incorrect, and then 
they come up with an argument that this is going to have a bad 
impact on the economy. Did you look at whether this will have a 
negative impact on the economy, or do you have people who make 
the claim that it is going to help the economy?
    Ms. McCabe. Well, we looked at the expected impacts on the 
power sector, and we also looked at and heard from a lot of 
States that are moving forward aggressively with some of the 
very measures that we outlined in the proposal, and indeed 
those States are enjoying job growth and additional investment 
in innovative strategies in the creation of jobs in pursuance 
of things like energy efficiency.
    Mr. Waxman. I ask that we put in the record a paper that we 
drafted of all the quotes over the last 40 years of the 
industries who said they couldn't achieve what the EPA was 
asking them to achieve under the law passed by Congress on a 
bipartisan basis. They said they couldn't achieve it without 
closing down their businesses or suffering dire economic 
consequences.
    We hear exaggerated claims about electricity costs, job 
losses, and even impaired electric reliability. These are 
doomsday claims. We have heard them before. And in the paper we 
put out, we showed how these claims were made and how 
inaccurate they were. What has been the history of the advances 
made under the Clean Air Act to give us some guidance as to 
whether we have to choose between clean air or a strong 
economy?
    Ms. McCabe. We don't have to make that choice between clean 
air and a strong economy, and, Congressman, I think as you have 
illustrated, the history of the Clean Air Act shows that we do 
not. Air has gotten cleaner, and the economy has grown, and the 
United States has been a global leader in pollution-control 
technology, energy-efficiency investments, and we expect that 
to continue with this program as well.
    Mr. Waxman. We heard a claim on the other side of the aisle 
that this EPA proposed rule would have no impact on public 
health. Can you give us your view of that?
    Ms. McCabe. We disagree with that. In fact, as I noted, the 
rule will result in 25 percent reduction in soot and smog 
pollutants, as well as 30 percent reduction in climate carbon 
pollutants. All of these issues affect public health, and 
reducing those emissions, taking them out of the air, will 
improve public health.
    Mr. Waxman. So this isn't just to do with the global 
problem of a warming planet that leads to climate change, but 
it will have an impact on the health of people near some of 
these power plants?
    Ms. McCabe. That is right. Those are important cobenefits 
of the rule.
    Mr. Waxman. Well, I compliment you on the rule. I think it 
makes a lot of sense, it gives a lot of flexibility, and it 
achieves the goals, and it encourages entrepreneurship to 
develop the industry and technology that will make us the 
leader in the world to accomplish these goals.
    Thank you, Mr. Chairman. Yield back.
    Mr. Whitfield. The gentleman's time is expired.
    At this time recognize the gentleman from Illinois, Mr. 
Shimkus, for 5 minutes.
    Mr. Shimkus. Thank you, Mr. Chairman. It is great to be 
here and--no?
    Mr. Whitfield. I am sorry, Mr. Barton actually was on the 
list first.
    Mr. Barton. No, no, I will yield to John, and then I will 
follow up later.
    Mr. Whitfield. OK. Mr. Shimkus is recognized for 5 minutes.
    Mr. Shimkus. Thank you, Mr. Chairman.
    And I am glad Mr. Waxman is here because he and many of my 
friends on the other side have seen this poster before. These 
are the real live job losses from the last Clean Air Act. 
Kinkaid, Illinois, I have invited you all to come by there, 
1,200 miners lost their job under a flexible system controlled 
by the State. The State made the decision, this mine closed, 
1,200 miners.
    So those of us who talk about this debate, we are trying to 
save our coal miner jobs in this country, and the President 
promised to make electricity generation by coal so expensive 
that he would drive that out of our market. Promises--San 
Francisco Chronicle, well documented, he is just following up 
on his promise, so those of us in the coal region of this 
country are under attack, and we have to deal with this, with 
our constituency and the debate. So that is why there is a lot 
of emotion, as you can imagine.
    Also, part of my portfolio of areas, the nuclear portfolio, 
the nuclear side, and so there are some curious things about 
this rule that begs--that creates a problem based upon States 
that had clean-burning nuclear power or generators that have 
shut down, but still have a standard by which now they can't 
meet because we are incentivizing the closing of nuclear power, 
which, if we are into clean air, climate change, we should be 
incentivized.
    Let me give you an example. 2013, four nuclear reactors 
prematurely to close. One of those reactors was Kewaunee plant 
in Wisconsin. When you all set the reduction target for 
Wisconsin, it did so based on electricity production in 2012, a 
year in which Kewaunee was still operating. So, you are 
calculating your reductions a year when you have got a nuclear 
plant operating, no carbon emissions, that facility closed, now 
that State and many States that have nuclear power--I have one 
of the largest nuclear power-generating States in the country--
is now disproportionately harmed by these rules, extremely 
harmed. So, the result is that Wisconsin will be forced to 
compensate for the loss of this plant and reduces emissions 
even further than the EPA targeted; is that correct? Is that 
analysis all correct?
    Ms. McCabe. So let me explain, Congressman.
    Mr. Shimkus. Quickly, please, as quickly as you can.
    Ms. McCabe. Yes, yes. So this rule addresses the fossil 
fuel sector. That is our responsibility under 111(d), so that 
is where we start, and our job is to identify the best system 
of emission reduction for fossil-fired plants. That doesn't 
include nuclear. So in 2012, we looked at emissions in each 
State from their fossil generation, and we then looked at what 
that best system of emission reduction, from a national basis, 
would result in in 2030. We recognize that there are States 
that rely on nuclear power that is zero carbon emitting. That 
is very good for carbon intensity.
    Mr. Shimkus. But we are disenfranchising those States that 
have the nuclear option.
    Ms. McCabe. We are, in fact, giving States credit for some 
portion of nuclear in their compliance plan so that----
    Mr. Shimkus. But to meet the standard, they have to even 
have more cuts, especially when a plant is closed, because you 
are basing that off the emissions in 2012, but their generating 
portfolio was based upon a nuclear plant that was operating.
    Ms. McCabe. This is not an energy plan for the State. This 
is a----
    Mr. Shimkus. That is our problem.
    Ms. McCabe. But that is not our job to----
    Mr. Shimkus. But that is the problem for our ratepayers, 
and because if you--if a generating facility that has zero 
emissions drops off 1,200 megawatts, 800 megawatts, whatever 
the base load is, they have to make that up, otherwise their 
costs are going to go up. And so we are not taking into 
consideration, in this carbon debate, zero emittant. We should 
be incentivizing this; should we not?
    Ms. McCabe. We are, and for any State that uses zero-
emitting generation to replace coal-fired generation or to meet 
their needs, they absolutely will be able to count that in 
their compliance plan and move them towards their goal.
    Mr. Shimkus. OK. Let me get to these final last few 
questions, and I appreciate that answer.
    What happens if the EPA doesn't approve a State 
implementation plan?
    Ms. McCabe. There is a provision--there is a little bit of 
language in 111(d) that says if we are not in a position to 
approve a State plan, then EPA is to move forward with a plan 
for that State.
    Mr. Shimkus. You will have a Federal implementation plan?
    Ms. McCabe. We are not focused on that right now because--
--
    Mr. Shimkus. But that is what the law will be--I mean, the 
rule will be.
    Ms. McCabe. That is what the law provides.
    Mr. Shimkus. What will that Federal implementation plan 
look like?
    Ms. McCabe. We have not come anywhere near to proposing a 
Federal implementation plan.
    Mr. Shimkus. I would suggest you start looking at that and 
be prepared to answer those questions on that.
    I yield back my time, Mr. Chairman.
    Mr. Whitfield. The gentleman's time is expired.
    At this time I recognize the gentleman from Kentucky, Mr. 
Yarmuth, for 5 minutes.
    Mr. Yarmuth. Thank you very much, Mr. Chairman, and 
welcome, Administrator.
    Last fall, EPA Administrator McCarthy met with our 
Governor, Steve Beshear, to discuss the proposed rule, and, 
after that meeting in Kentucky, sent a framework to EPA with 
recommendations on ways to develop a rule that would reduce 
carbon pollution cost-effectively while offering our State the 
flexibility in meeting the new standards. My understanding is 
that EPA followed almost all of the Commonwealth's 
recommendations; is that correct?
    Ms. McCabe. I believe so, Congressman.
    Mr. Yarmuth. And those included, again, allowing States to 
reduce emissions; flexibly using measures such as energy 
efficiency, renewable energy, and fuel switching to natural 
gas, rather than forcing States to reduce emissions in any 
specific plant; also recognizing differences among States' 
resource potential, current generation portfolios, and allowing 
a variety of compliance options, including energy efficiency 
and so forth, as you said.
    But here is another example of how that flexibility can 
help. The American Recovery and Reinvestment Act established a 
rebate program that helps spur development and adoption of 
energy-efficient appliances to replace older, less efficient 
appliances. General Electric has a major manufacturing facility 
in my district, and because of that program, they were able to 
bring a manufacturing line of refrigerators from Mexico back to 
Louisville and creating hundreds of jobs in the process.
    Does the proposed rule allow States to take credit for 
reductions achieved through energy-efficient initiatives like 
this one?
    Ms. McCabe. Certainly any program that encourages, or 
incentivizes, or provides for ways for people to save energy, 
which means less carbon going up the stack, are completely 
creditable under the plan.
    Mr. Yarmuth. Well, we are happy that EPA agrees with that. 
That is a good example of how to create flexibility, and also 
create energy efficiency and help consumers save money and 
reduce emissions.
    And I am glad the chairman mentioned Waxman-Markey earlier 
in his opening remarks, because I was one of a group of 10 or 
12 or so Representatives from States that were heavily 
dependent on carbon, on coal-based energy, who went to our 
leadership at the time--Rick Boucher from Virginia led that 
effort--and we basically said to our leadership and to Mr. 
Waxman that we couldn't support the bill as it was originally 
drafted, that it would have been devastating for our consumers 
and our businesses, and they made changes in that bill.
    And before I voted for that bill, I talked to all the major 
consumers of energy in my district, General Electric being one, 
Ford Motor Company has two major manufacturing facilities, the 
University of Louisville, the Jefferson County Public School 
System, Louisville metro government, UPS, we are the global hub 
of UPS.
    And not one of those users of electricity objected to that 
law, proposed law, and said they were either for it or neutral 
on it, saying, ``We could live with it.'' I talked to our 
utility company and asked what the impact of that law would be 
on residential customers, and they said, ``We think that after 
10 years, the average residential user will have their rates go 
up 15 percent, if they do nothing else: They don't adjust their 
thermostat, they don't change light bulbs, they don't insulate, 
so forth. So if they are paying $200 a month at the beginning 
of the period, 10 years from now they will be paying $230 a 
month.''
    So, I felt pretty comfortable that I could vote on that and 
knowing that there would be minimal negative impact on my 
constituents. So I am glad that the chairman compared what the 
EPA rule does now to that law back then, proposed law back 
then, which Republicans in the Senate killed.
    But I want to get to this whole scare tactic, with 
manufacturing businesses being affected and moving out of State 
and so forth, because, again, I haven't heard from any of my 
major manufacturers and I have a lot of them in my district. 
They are not afraid of this proposed rule.
    So my question is to you, assuming--it is not easy to move 
a manufacturing company. Ford has almost a couple billion 
dollars invested in my district, in their two plants. They just 
can't pick up and leave even if the energy went up. But you 
made an estimate at what the increased potential rates would be 
even in the short term of this, and I think it was about 3 
percent. Is that correct?
    Ms. McCabe. That is correct.
    Mr. Yarmuth. So it seems hard to logically predict that a 
3-percent rise in a manufacturing company's rates would be 
enough of a financial disincentive to force them to pick up a 
major investment and move somewhere else. Is that part of the 
calculation that you did when you were creating this rule?
    Ms. McCabe. Well, energy efficiency is good for everybody 
and good for business. I think we all know that, and as you 
say, the increases in electricity prices we see are modest in 
the short term and then go down over the long term. So I think 
businesses will take that into account.
    Mr. Yarmuth. Great. Thank you.
    I yield back.
    Mr. Whitfield. At this time, recognize the gentleman from 
Texas, Mr. Barton, for 5 minutes.
    Mr. Barton. Thank you, Mr. Chairman.
    Am I not correct, Administrator McCabe, when I say that 
this proposal that we are discussing today is not actually 
required by the Clean Air Act? Isn't that a true statement?
    Ms. McCabe. No. It is required when we issue a 111(b) 
standard for a sector to then go forward with a 111(d) 
standard.
    Mr. Barton. Well, I think that is wrong. I think it is 
allowed, but I don't see any statutory authority that demands 
these proposals. I do accept that there is a Supreme Court case 
and a Presidential finding of endangerment that allows the 
Clean Air Act to be used. But I see nowhere in this statute 
that this has to happen. Do you agree with that?
    Ms. McCabe. Respectfully, no. I believe we, the Clean Air 
Act does----
    Mr. Barton. If you believe that, I want the general counsel 
of the EPA to back that up. Will you do that?
    Ms. McCabe. Sure.
    Mr. Barton. Send it to the committee?
    Ms. McCabe. Yep.
    Mr. Barton. My understanding that what you are attempting 
to propose is directed by a Presidential speech dated June 25, 
2013, that was called the climate action plan that has then 
been followed up by a Presidential memo where some of these 
requirements were directed towards the EPA to implement that. I 
would assume that you are aware of this memo.
    Ms. McCabe. I am.
    Mr. Barton. OK. Can you tell me what the legal force of the 
Presidential memo is?
    Ms. McCabe. Well, the President's memo and climate action 
plan laid out a series of steps that are within the 
responsibility of the EPA and other agencies to move forward 
with. The President gave us a schedule on which to move forward 
with this rulemaking but directed that we undertake the 
rulemakings that are within our authority under the Clean Air 
Act to address environmental challenges.
    Mr. Barton. Well, I accept that the President has the right 
to give speeches, and I even accept the fact that the President 
has the right to issue memos and, as the Chief Executive 
Officer of the Federal Government, to direct that the Executive 
Branch, in this case your agency, the EPA, to try to implement 
those Presidential memos, but I don't accept that this is 
something that absolutely has to be done, and whatever 
documentation you can provide that shows that this is a forcing 
authority, I would like to have.
    In your statement, you went to some lengths to talk about 
all the flexibility that the States are going to have. I am 
told in the case of Texas, the decisions were made before the 
State of Texas even had an opportunity to comment that they 
received a memo or a checklist almost after the fact; are you 
aware of that?
    Ms. McCabe. I am not sure what you are referring to, 
Congressman. We had many conversations with States, both 
individually and in groups, and of course, this is a proposal, 
so we are still taking comment from people. I have had at least 
multiple hours of conversation with States even since June 2. 
So there has been lots of opportunity to talk with the States.
    Mr. Barton. Well, just as an example, are you aware of the 
fact that if Texas closed down every existing fossil fuel 
generation plant in the State, every one, every coal-fired 
plant, every natural gas plant in the State of Texas, that it 
would still not meet the new proposed ESPS; are you aware of 
that?
    Ms. McCabe. The plan relies on States implementing a 
number----
    Mr. Barton. OK. I am asking if you are aware of that in the 
case of Texas. If we shut down every coal-fired plant and every 
natural gas plant in the State, every one, we can't meet these 
suggested goals.
    Ms. McCabe. I haven't done that calculation, Congressman.
    Mr. Barton. All right. Well, I suggest that you do it. 
Texas would end up with a new source performance standard that 
is below EPA's own standard. The EPA standard is 1,000 pounds 
of CO2 per million megawatts, per megawatt of 
production, and for Texas to actually meet with the EPA as 
suggesting it should, we would have to go down to 791, which is 
about 21 percent below your own standard.
    I mean, you know, the renewable standard for Texas is based 
on the energy renewable portfolio standard for Kansas. Now, I 
am not anti-Kansas. I want Mr. Pompeo to know, but Kansas' 
electricity demand and generation is 10 percent of the State of 
Texas. Texas leads the Nation in renewable generation, and 
Texas produces three times as much energy by renewable, as the 
next three States combined.
    Ms. McCabe. Texas has immense opportunities when it comes 
to----
    Mr. Barton. And we get no credit for that in your proposal. 
None.
    Ms. McCabe. Well----
    Mr. Barton. None.
    Ms. McCabe [continuing]. The State does, actually, and----
    Mr. Barton. Well, the State of Texas tells me they don't.
    Ms. McCabe. Well, we are happy to have further 
conversations with the State of Texas about the goal.
    Mr. Barton. My time has expired.
    Mr. Whitfield. The gentleman's time has expired.
    Mr. Barton. Put me down as extremely undecided on this 
proposal.
    Mr. Whitfield. Yes, I will.
    At this time, I would like to recognize the gentleman from 
California, Mr. McNerney, for 5 minutes.
    Mr. McNerney. Thank you, Mr. Chairman, and I thank you, Ms. 
McCabe, for coming here today.
    You mentioned that the EPA predicts a reduction in energy 
costs, family energy bills, I take it, by the year 2030?
    Ms. McCabe. Yes.
    Mr. McNerney. Would you elaborate on that and maybe give us 
some idea of what the reduction estimates look like?
    Ms. McCabe. Sure. Sure. So as the States implement their 
plans, we expect a large reliance on demand side and energy 
efficiency measures, that will reduce the number of kilowatts a 
family needs to consume over the course of a month, and so when 
we project that out, we show that it is about an 8 percent 
decrease in a bill, in a family's bill.
    Mr. McNerney. So an American family might look to something 
almost like 10 percent of reduction in their monthly energy 
bills by 2030 as a result of this rule, of the proposed rule?
    Ms. McCabe. That is what the proposed rule predicts based 
on our forecast. Of course, each State, as I have said, will do 
its own plan.
    Mr. McNerney. That is not too bad. Would you please 
describe the outreach that the EPA conducted to the various 
States. Give us some idea of the magnitude of that effort?
    Ms. McCabe. Sure. We started last August, well before we 
even put pen to paper on the rule. In my experience of decades 
in working, first, from the State side, most of my career from 
the State side, I am not aware of EPA ever doing this kind of 
outreach, and it was broad ranging with all stakeholders.
    But in particular, with respect to States, we met with 
States in groups, they have regional organizations. We met with 
those regional organizations. Our regional offices convene 
groups of State officials, both from the environmental and the 
energy side, as well as other stakeholders and utilities.
    Mr. McNerney. Were most States cooperative, or did they 
stand aside and give a, you know, a less cooperative stance?
    Ms. McCabe. Oh, I would say that there was great interest 
and continues to be great interest from the State officials on 
talking with us about the program.
    Mr. McNerney. Would you describe the reduction of 
conventional pollution, its projected impact on health and the 
monetary impacts of those health benefits from these rules, if 
implemented?
    Ms. McCabe. Sure. So as co-benefits of reducing carbon, 
there would also be reductions in particle pollution, nitrogen 
oxide, sulfur dioxide, which have very immediate and localized, 
as well as regional health benefits and we predict about a 25 
percent in reduction of those pollutants compared to what they 
would otherwise be in 2030 without this rule.
    So that will result in reduced asthma attacks, reduced 
emergency room visits, reduced missed days of school in the 
billions of dollars of health benefits to the American people.
    Mr. McNerney. Is there any way to talk about the return on 
investment that might have to be made by the different States?
    Ms. McCabe. Well, we do show that for every dollar invested 
there's a $7 return in public health benefits as a result of 
the program.
    Mr. McNerney. And then would these investments be made by 
States or by the private entities involved?
    Ms. McCabe. Well, they would be made by the private 
entities, the businesses investing in technology, investing in 
new workers to employ energy efficiency around the State with 
all the benefits that those bring.
    Mr. McNerney. Well, you know, I understand the four pillars 
of this are increasing upbringing efficiency of the different 
plants. What could be more reasonable than that? Using gas-
fired plants at 70 percent of their capacity, which is a good 
idea if you have a gas-powered plant. In fact, gas is more 
affordable now than many other forms, using renewable energy 
that the applicable locally to the State and using nuclear as 
long as possible, and it is encouraging user efficiency, end-
user efficiency.
    So, these are all pretty reasonable, in my mind. I don't 
see how that would be viewed, any of those, as too intrusive. 
Are there other measures that can be taken that would also help 
reduce pollution that are included in this rule, or----
    Ms. McCabe. Yes. Those are so reasonable that they are 
being done in a widespread manner, but there are other things 
that States or utilities can think about doing. There is other 
types of fuel switching they can do. They can look at their 
transmission systems and see whether there is leakage there 
that can be tightened up. So there are a number of other things 
that folks can do.
    Mr. McNerney. And the last thing is the State flexibility. 
I mean, I understand there is a great deal of flexibility the 
States have adopted and it will make it a lot easier for the 
different States to implement these proposed rules.
    Ms. McCabe. Yes, that is right.
    Mr. McNerney. All right.
    Thank you, Mr. Chairman. I yield back.
    Mr. Whitfield. At this time, recognize the gentleman from 
Ohio, Mr. Latta, for 5 minutes.
    Mr. Latta. Well, thank you very much, Mr. Chairman, and 
thanks very much for being with us today. We greatly appreciate 
it.
    Last week, the Governor of Ohio signed a piece of 
legislation citing energy costs leading our growth concern, 
that put a 2-year freeze on Ohio's renewable energy mandate 
that the State imposed on itself. I would like you to consider 
this hypothetical situation going into the future.
    Assume that the Ohio renewable energy standard was included 
in its State implementation plan, the SIP, and to comply with 
the EPA's existing plant rule. Assume also that the EPA 
approved that SIP, OK. In that scenario, would the State of 
Ohio maintain its discretion to freeze the renewable energy 
program in order to protect the interest of Ohioans?
    Ms. McCabe. The State would continue to have flexibility if 
circumstances change in the State to replace one particular 
measure with another, and the proposal lays out the process by 
which a State could do that. So there is opportunities for 
States to adjust their plans along the way.
    Mr. Latta. Let me ask then, would the State have to get 
that approval from the EPA?
    Ms. McCabe. If a State wants to replace one measure with 
another, they would come to EPA and say, this is what we are 
doing.
    Mr. Latta. OK. And how did the process overall work, and 
how much time would it take for a State to get that 
implemented, then, if they want to make a change?
    Ms. McCabe. Well, we work with States all the time in 
circumstances where they wish to change their State 
implementation plans and so we work with the State to 
prioritize those actions and try to meet the State's needs in 
terms of timing.
    Mr. Latta. And then also, would Ohio be subject to Clean 
Air Act penalties if they didn't first obtain any EPA approval 
before they make any implementation to a change at that time?
    Ms. McCabe. I don't believe so, Congressman. The provisions 
in the Clean Air Act for penalties are pretty clearly laid out 
and there is a pretty clear process for when those could be 
invoked. So I think in any circumstance like this, we would 
work with the State to make sure that they can do what they 
needed to do as long as it met the ultimate goal.
    Mr. Latta. Well, just to be on the safe side, if you can 
get that back to the committee, that they wouldn't face 
penalties if that were to occur?
    Ms. McCabe. Sure, we will answer further on that.
    Mr. Latta. And also, just talking a little bit about Ohio, 
we get about 70 percent of our generation in the State of Ohio 
comes from coal. In my district, which I have about 60,000 
manufacturing jobs, it is even higher than that--that we are a 
coal-based generating State, and up in my area of the State, I 
also have a very unique situation. I have a lot of electric co-
ops.
    So how does the EPA's Clean Power Plan avoid putting these 
small co-ops at a competitive disadvantage and especially the 
customers? Because, again, in my district, when you look who 
they are serving, you are talking about a lot of--I have 60,000 
manufacturing jobs, I also have the largest numbers of farmers 
in the State of Ohio.
    How do you put them not at a competitive disadvantage under 
the Clean Power Plan? Because, again, you have got the farmers, 
you have got these small businesses out there, you have got a 
lot of retirees----
    Ms. McCabe. Yes.
    Mr. Latta. What happens? How do we make sure they are not 
at a competitive disadvantage?
    Ms. McCabe. Well, this is where the design of Section 
111(d) and the flexibility and the plan really shows its value. 
It is because it will be up to the State of Ohio to design a 
plan that works for the State of Ohio. I come from Indiana, and 
so it is very similar in terms of the types of sources----
    Mr. Latta. Well, if I could just interrupt, because you 
coming from Indiana, you know that just a few years ago, 
especially when the President was talking about his cap and tax 
plan, that when Ohio was at about 70 percent generation of 
coal, Indiana was at about 90 percent. So they are really in 
harm's way when it comes to these new rules and standards. So 
excuse me for interrupting.
    Ms. McCabe. No, I gave you the opening. I actually don't 
think they are in harm's way. I think that the way we have 
designed the plan is very respectful of the fact that States 
like Ohio and Indiana do rely heavily on coal. They have 
different opportunities than States with a different energy mix 
and they can design a plan that addresses concerns related to 
small rural co-ops, public power, particular concerns.
    This plan works. It doesn't require any particular plant to 
meet any particular emission rate, and it looks at emissions 
over a long averaging period. So that is another way in which 
the plan gives lots of flexibility for the State to be able to 
adjust to its particular needs, its manufacturing community, 
its rural communities, cities, whatever the particular needs 
are.
    Mr. Latta. Thank you, Mr. Chairman.
    My time has expired and I yield back.
    Mr. Whitfield. At this time, I recognize the gentleman from 
Texas, Mr. Green, for 5 minutes.
    Mr. Green. Thank you, Mr. Chairman.
    And I have a little different Texas accent, and I'm sorry 
to my colleague from Texas, Joe Barton is a good friend and we 
work together on a lot of things.
    EPA does have the authority to regulate CO2 
under the Clean Air Act. Supreme Court ruled it and the rule we 
are discussing will have significant impact for decades on 
industries in my area, in Houston.
    The issue of climate change is one of the most important 
issues we should face as a Congress. The EPA has constructed a 
framework that provides States with the flexibility and 
opportunity. It is important to remember those four building 
blocks proposed by the rules are not the exhaustive list. The 
four building blocks are a prescription for success.
    States are allowed to construct a plan that matches their 
needs and those in their affected communities and as I said 
before, the EPA is legally justified in regulating carbon, and 
I would prefer Congress take the lead in doing it. I believe as 
elected officials, we have the duty to act on behalf of our 
constituents to regulate these pollutants.
    Again, Ms. McCabe, I am sure you are aware EPA in my home 
State of Texas have had some issues in the past and for more 
than 3 years, EPA was responsible for issuing GHG permits which 
caused significant problems for our industry looking to build 
and expand even new facilities. Just this last week, the 
Governor of Texas along with six other State Governors sent a 
letter to the President asking him to dispose of the carbon 
rule. It is my hope that we will not go down that path again.
    My first question, having said that, Ms. McCabe, can you 
explain to the committee what concerns your office receives 
from stakeholder groups, including States, as you prepared the 
rules, and what did EPA do to mitigate these concerns?
    And obviously, from my part of the country, I appreciate if 
Texas had some input in how you responded to it.
    Ms. McCabe. Yes. We heard a number of very specific things 
from States and other stakeholders. We heard that States wanted 
to be able to, for example, do their own plans or they wanted 
the ability to perhaps join with other States and do a multi-
State plan, and our proposal allows for that.
    States were very concerned about the time that they would 
have for two things: One, to develop a plan; and two, to 
actually achieve the carbon reductions, and so our proposal 
response to both of those, first, by giving an extended 
compliance time period all the way out to 2030 with a long 
glide path down to that, but also in response to their first 
concern, how long would they have to submit a plan. We have 
provided for either a 1- or a 2-year extension for States to 
get them some additional time to put their plans together if 
they need that.
    Another thing that we heard from States is to allow them 
the flexibility to either craft their plan around a rate-based 
approach or a mass-tons-of-carbon-emitted approach, if that is 
the way they wanted to manage their plan, and so our plan 
allows for both of those approaches.
    Mr. Green. OK. I have reviewed the rule and the four 
proposed building blocks. EPA has estimated that the majority 
of the carbon reductions from the State of Texas would come 
from building blocks, two of them, utilize utilization of the 
existing natural gas, combined cycle power plants; however, 
there are other additional reductions calculated under building 
blocks three and four.
    And you may know, Texas has more wind generation than any 
other State. Texas is the first State in the Nation to pass 
legislation establishing energy efficiency resources standards.
    My concern is, EPA has proposed that Texas is capable of 
meeting higher renewable energy and energy efficiency demands. 
My next questions have to do with the studies conducted 
included by EPA to meet these demands. EPA states these 
estimates are subject to significant limitations and market 
barriers, including consumer behavior.
    My next question: Are EPA estimates in the proposed rule 
expected to overcome these limitations and barriers?
    Ms. McCabe. Well, the estimations that we use for each 
building block are based on a national framework. So they are 
not individualized to every State, but of course, the State, as 
I have said, has the ability to apply them in any way that it 
wishes and that it makes sense for them. So if there are market 
barriers, for example, to additional renewable energy 
efficiency, the State can look to other more reasonable, more 
appropriate measures for them to employ.
    Mr. Green. OK. I only have 30 seconds.
    The State EPA estimates that two building blocks are 
expected to raise prices. Further, EPA estimates that 90 
percent of the efficiency, energy efficiency comes from the 
rate payers. What effect do you think these prices increase 
will have on consumer behavior? Will they actually be more 
efficient? And won't consumers be more inclined to maintain the 
status quo as opposed to paying more for new programs?
    The last thing, though, the studies that EPA is relying on, 
are they available to the public before the close of the public 
comment period so that people can respond to?
    Ms. McCabe. Yes, all of our technical support documents in 
the studies are available in the docket, which I believe opened 
yesterday when the rule was published.
    But the answer to your first question is that, we have seen 
in States that have very proactive and forward-looking energy 
efficiency programs that they are quite successful and that 
measures do get implemented and consumers do save money.
    Mr. Green. Thank you, Mr. Chairman.
    Mr. Whitfield. At this time, we recognize the gentleman 
from Louisiana, Mr. Cassidy, for 5 minutes.
    Mr. Cassidy. Thank you, Mr. Chairman.
    Ms. McCabe, I will also first make a statement and then ask 
some questions.
    When you say that utility bills are going to go down by 8 
percent, it reminds me of candidate Obama saying that, under 
his health care plan, insurance premiums would decrease by 
$2,500 per family without increased taxes and without a 
mandate. Of course, now they are up by $2,500 per family. When 
you say that you are going to give States flexibility, it 
reminds me of, ``If you like your doctor, you can keep it.''
    Now, I will tell you, I know of a family losing their home. 
They have refinanced their mortgage and so it is actually 
paying less for that. But their cost of food, gasoline, 
insurance is all going up. They have been denied the economic 
benefits of projects like Keystone XL pipeline, which now 
Canada is going to ship their oil to China to create Chinese 
jobs and you want to raise their utility prices.
    Now, you may say that conservation will not decrease, but 
let's be clear, let's not mislead. The reality is poor people, 
those who are lower income are less able to invest in those 
conservation measures. This is just going to be a bull's eye on 
other families' ability to do things such as keep their homes.
    Now, there has been a lot of, this administration has 
raised to an art level misleading the American people by doing 
certain things, manipulating statistics. But let's at least be 
honest about it. Now, I will go to Mr. Yarmuth's question 
earlier. If Ford has a decision to invest in Kentucky or to 
invest in Mexico, and we are raising their input cost of 
energy, we are going to tilt them towards investing elsewhere. 
Is that a fair statement?
    Ms. McCabe. There are many things that go into people's 
decisions.
    Mr. Cassidy. Is it a fair statement? If one of your key 
inputs is energy costs and you are raising that cost, we can't 
compete on labor. So our energy costs have been lower, so 
people have been reshoring jobs. Reality is now you wish to 
increase those energy costs. Now, that said, doesn't it just 
make sense, we will tilt them towards doing further economic 
development elsewhere?
    Ms. McCabe. I don't think I can agree with that statement.
    Mr. Cassidy. I have got to tell you. Somehow, at some 
point, we have to be honest with each other. Now, on the other 
hand, if you say this is not an energy plan, and you are not 
saying any State has to cut down their coal usage or decrease 
or eliminate coal usage, but the only way to achieve this goal, 
which, if they do not, you will come in with your own plan, is 
to eliminate coal-fired plants.
    You may say you don't demand something, but the inherent 
nature of the rule, the only way it can be reached without the 
Federal Government squeezing the State will be to shut down 
coal. Do you deny that?
    Ms. McCabe. I do, actually, Congressman. The plan predicts 
that in 2030, coal will provide 30 percent of the energy----
    Mr. Cassidy. So we have something here which is based upon 
an analysis of Washington State, which has to have a 90 percent 
decrease in their use of carbon, and the only way they get it 
is to completely shut down coal.
    Now, you may say Washington State does not have this 
mandate to shut down the coal, but the only way they get there 
is to shut down the coal. So, again, I just feel like there is 
a lack of openness.
    Let me ask you something else. Has the EPA examined the 
ripple effects of this throughout the economy?
    Ms. McCabe. The EPA has focused on the impacts in the power 
sector.
    Mr. Cassidy. But throughout the economy, the users of that 
power, the Ford motor plant or Louisiana has $90 billion in 
announced construction projects involving polymers, 
petrochemical, gas to liquids, industry that will create great 
paying jobs for working Americans. Have you analyzed the impact 
of this regulation upon that $90 billion of announced expansion 
to manufacturing base?
    Ms. McCabe. No. No, we haven't.
    Mr. Cassidy. Yes. Yes. So these jobs are on the bubble. 
There are more families that will lose their homes, and you 
have not done the analysis. Now, if you call me skeptical, I 
will join Mr. Barton in being incredibly skeptical.
    Now, what else do I have here? I am sorry if I seem so 
aggravated, but I keep on thinking of that family losing their 
home. Their food is going up, their gasoline is going up, their 
insurance is going up after they were told it would decrease, 
and now we are told that their electricity bill will go down 8 
percent. By the way, a coal-fired plant supplies their 
electricity. This administration is so busy saving the Earth 
they are willing to sacrifice the American family.
    Now, I am sorry to be so aggravated but I keep on thinking 
of them, and I can't imagine the insensitivity of this 
President and this administration to their plight, but it is 
evident to see.
    I yield back.
    Mr. Whitfield. Gentleman yields back.
    At this time, we recognize the gentlelady from California, 
Ms. Capps, for 5 minutes.
    Ms. Capps. Thank you, Mr. Chairman. And may I ask 
permission to include in the record a letter from several 
public health organizations in favor of this ruling by the----
    Mr. Whitfield. Without objection.
    [The information follows:]
    
    [GRAPHIC] [TIFF OMITTED] 
    
    Ms. Capps. Thank you, Mr. Chairman, for holding this 
hearing.
    And I thank you, Ms. McCabe, for being here today and for 
your hard work on these clean power rules.
    I know climate change is a critical issue, and it demands 
action, and EPA's clean power rules, I believe, are a major 
step forward. Climate change, as we know, is already having 
such a wide range of impacts on weather, on food and water 
supplies, ocean, health, air quality and so much more. My 
background as a public health nurse, I am particularly 
concerned about climate change's impacts on public health.
    EPA's analysis show that there will be significant health 
benefits from implementing these clean power rules, and as I 
understand it, these health benefits come on two levels; this 
is what I would like to ask your confirmation on.
    One, the primary benefit of reducing the greenhouse gas 
emissions that are driving climate change; and two, the coal 
benefits of reducing emissions of other harmful air pollutants 
like sulfur dioxide, nitrogen oxides and particulate matter. Do 
you affirm that this is accurate?
    Ms. McCabe. That is correct.
    Ms. Capps. And some have criticized the methodology used to 
evaluate these coal benefits, and they accuse EPA of double 
counting. Can you respond at this point, how did EPA calculate 
the health benefits of this rule?
    Ms. McCabe. Yes, when we look at the health benefits of any 
given proposal, we build those on top of the health benefits 
that have already accrued from rules that are already on the 
books.
    Ms. Capps. Right.
    Ms. McCabe. So we don't include those benefits. These are 
all additive on top of that, incremental.
    Ms. Capps. OK. Now opponents of these rules frequently cite 
the cost of compliance as a reason not to pursue them, and of 
course, we have to acknowledge, there will be compliance costs. 
There will also, though, however, be significant benefits and I 
would like to argue that the benefits are particularly there 
for children and for families.
    Ms. McCabe. Yes.
    Ms. Capps. Can you add to our discussion here about how the 
health benefits of these rules compare to the estimated 
compliance cost; in other words, what is that cost benefit 
ratio?
    Ms. McCabe. Uh-huh, yes. So and, again, the costs that will 
be incurred by the rule ultimately will be decided by how the 
States choose to go forward with their plans.
    Ms. Capps. Right.
    Ms. McCabe. But in our assessment, we estimate a $7 to $9 
billion cost compared to up to $90 billion health benefits and 
in particular, with respect to the health code benefits, each 
dollar spent on the rule will generate $7 in health benefits.
    And I should note in response to that and in partial 
response to the previous question then, that State programs 
that will be used to implement these, many of them build in 
assistance to low income, rate payers and, again, those are the 
citizens and the families that are most at risk and most 
vulnerable to the health impacts that we see from air pollution 
and from climate change.
    Ms. Capps. OK. It is clear that these clean power rules 
will have some significant benefits for the American people. I 
believe they deserve our support. I hope we can find a way to 
work together to get these rules implemented as soon as 
possible. I, for one, really don't believe we can afford to 
wait any longer.
    You know, there are States like California, where I am 
from, that have seen some great economic benefits from 
renewables and energy efficiencies. As these are implemented, 
there are cost savings just in putting people to work on 
efficiencies and on developing new resources for renewables.
    There is a minute left, if you would like to use it to 
outline some of the economic benefits, as these could offset 
the cost of a change over.
    Ms. McCabe. Yes. So California, clearly, has been a leader 
on renewables and investment in energy efficiency, and these 
create good jobs that are localized jobs, machining equipment, 
installing insulation, weatherizing homes, whether it is 
existing homes or new construction. So these are jobs that 
happen in our communities and result from these sorts of 
programs.
    Ms. Capps. Thank you. Just in the quarter of a minute that 
I have left, you remind me of some programs that went into 
effect with some of our low-skilled workforce during the 
recession to get them to weatherize and put in efficiency 
opportunities for some of our low-income housing, reducing 
energy costs for the occupants of the housing, putting people 
to work, learning some new skills that could continue, and this 
is, frankly, an ongoing process that as technology advances 
will never slow down or stop.
    And thank you for your answers.
    And thank you, Mr. Chairman. I yield back.
    Mr. Whitfield. This time, recognize the gentleman from 
Nebraska, Mr. Terry, for 5 minutes.
    Mr. Terry. Thank you, Mr. Chairman. I appreciate that.
    And I am humored by the argument that this is not a 
mandate. I mean, if the Federal agency said I live in Omaha but 
I have to make it to Lincoln at a certain time, and I can only 
take 45 minutes to get there, that is a mandate. Even if you 
left me up to my own imagination of how I would get there, it 
is still a mandate, and so it is interesting that we can play 
word games, but it is still a mandate and it will have cost.
    We are a State that is 72 percent reliant on coal. We are a 
State where you take 6 to 7 hours at 75 miles an hour to get 
across. So, some of this doesn't make a lot of sense, but I 
have reached out to our major public power entities. We are an 
all-public-power State, so Omaha public power, Nebraska public 
power, as well as our, NDEQ, NPA, our National Power 
Association and some of our rules. They are all working 
together, that is the good news. Bad news is they are 
completely panicked in how to actually do the plan and how to 
actually meet the 26 percent mandated reduction. Because we are 
72 percent relying upon coal.
    So in reaching out to them, they are frustrated in the lack 
of direction, what they see as conflicting information from the 
EPA on how to move forward. But one of the areas that they 
would like to have nailed down is the percentages for 
reductions are based on, is it 2012 numbers or 2005 numbers?
    Ms. McCabe. Where we look to start to see where States were 
was the data, most recent data, which is 2012 so----
    Mr. Terry. So that is the baseline, is 2012. Why would they 
get confused about 2005?
    Ms. McCabe. There isn't really a baseline, but 2012 is 
the----
    Mr. Terry. How is there no baseline?
    Ms. McCabe [continuing]. Is the starting carbon intensity. 
The reason that people are confused about 2005 is because 2005 
is a year that people have been using a lot to talk about our 
progress towards reducing greenhouse gases.
    And so in describing the impacts of the rule, EPA has 
compared the reductions that will be achieved into 2030 to that 
2005 number. But the starting point for this rule is 2012.
    Mr. Terry. So bottom line, then, just like you finished, 
2012 is the date that the State of Nebraska has to use to 
calculate the 26 percent reduction on, correct?
    Ms. McCabe. That is the date that we used to calculate 
their goal that they need to meet in 2030.
    Mr. Terry. So, again, if they are using 2012 as their 
baseline to reduce 26 percent, they are OK with the EPA?
    Ms. McCabe. As long as their plan shows that they will get 
to the goal that is set forth in the rule.
    Mr. Terry. For 26 percent?
    Ms. McCabe. For 2030.
    Mr. Terry. By 2030?
    Ms. McCabe. And if that is 26 percent, I don't know the 
Nebraska target off the----
    Mr. Terry. That is the stated reduction that was told to 
the State of Nebraska.
    Ms. McCabe. Yes.
    Mr. Terry. So now, is there any flexibility in the States 
of using a different year as the baseline?
    Ms. McCabe. Well, no.
    Mr. Terry. OK.
    Ms. McCabe. We need to start the States at a----
    Mr. Terry. OK.
    Ms. McCabe [continuing]. Where they are.
    Mr. Terry. No is a solid answer. That is clear. Clear is 
sometimes good even if you disagree with it.
    Now, if States include a renewable portfolio standard in 
their State implementation, does that make it a Federally 
enforceable mandate?
    Ms. McCabe. So the----
    Mr. Terry. De jure or de facto.
    Ms. McCabe. Right. The plans will be Federally approved. We 
actually lay out an extensive discussion on this issue in the 
preamble that we are very interested in getting people's 
feedback on because we heard this question a lot, and we are 
looking for feedback on how to design that.
    But the plan itself would be enforceable so that to make 
sure that the reductions would get done.
    Mr. Terry. All right. I have got four pages of questions 
from our NDEQ in power districts, but we will submit those in 
writing to you.
    Ms. McCabe. Please do. And we have had a number of 
conversations with officials from your State and certainly 
would be happy to set up other opportunities.
    Mr. Terry. Well, I will state for my last few seconds that 
I have talked to some of the board directors of OPPD and NPPD, 
and they said the only conclusion they have come to so far is 
it is going to cost them, quote, ``a hell of a lot of money,'' 
end quote.
    Mr. Whitfield. And we are going to have more hearings, so 
you will have the opportunity to ask more questions, as well.
    At this time, recognize the gentleman from Pennsylvania, 
the manager of the Democratic baseball team, Mr. Doyle, for 5 
minutes.
    Mr. Doyle. Thank you, Mr. Chairman.
    Welcome, Ms. McCabe.
    Ms. McCabe. Thank you.
    Mr. Doyle. As you know, Pennsylvania generates significant 
amount of our electricity from coal, and over the last few 
years, we have seen several coal plants retired in Pennsylvania 
to be in compliance with the MATS standard. I have heard this 
type of early action will be acknowledged, and EPA officials 
said on a recent conference call that it is their intent to 
credit plant retirements forced by the MATS rule.
    So I am curious, how will States and generators get credit 
for plants they retire or will retire between 2012 and the 
final rule?
    Ms. McCabe. So anything that a State does that reduces the 
amount of the carbon intensity of the generation in the State, 
will be eligible to be part of their plan. So if a State is 
closing a coal plant, for whatever reason, and there are many 
reasons why coal plants are being closed around the country, if 
that power is replaced with either lower carbon natural gas, or 
zero carbon renewables, or not as much generation as needed 
because of energy efficiency, that will all work to the State's 
advantage in building their glide path towards the goal that is 
required.
    Mr. Doyle. But they will get credit for--I mean, basically 
we want to make sure that we are getting credit for doing the 
right thing in advance of the final ruling, whenever that final 
ruling comes out.
    Ms. McCabe. Right.
    Mr. Doyle. And you are saying that that will be the case?
    Ms. McCabe. Yes.
    Mr. Doyle. OK. Can you talk specifically about some of the 
opportunities my State might have to reduce carbon pollution 
from our power sector? I mean, do you anticipate that coal will 
continue to be a big part of our power mix going forward?
    Ms. McCabe. I do expect and, in fact, we show across the 
country that coal will continue to be about a 30 percent share 
of production, and although I don't have the Pennsylvania 
figures in front of me right now, a coal intensive State like 
Pennsylvania, we presume, would continue to have a significant 
amount of its power generated from coal.
    And the targets that we calculated, in fact, very much took 
that existing energy mix into account and we think that 
Pennsylvania, like other coal intensive States, has things that 
they can do, and the target was designed to capture the things 
that Pennsylvania can reasonably do.
    Mr. Doyle. Uh-huh. I want to talk to you a little bit about 
the flexibility options in this in terms of the potential for 
increased flexibility. So my understanding is that State 
specific emission goals were derived from one calendar year of 
actual operations, 2012----
    Ms. McCabe. That is right.
    Mr. Doyle [continuing]. Which people are calling the 
baseline year. You know, in the past rules, an average of 
several years were used in order to smooth out any anomalies, 
and it seems that a 1-year snapshot might yield an inaccurate 
starting point, especially if the State had several plants on 
extended outages, for example, or some anomalies existed in 
2012 that didn't exist in other years.
    Would the EPA be willing to consider more flexibility of 
sorts, like averaging a few years to establish a more accurate 
starting point or baseline?
    Ms. McCabe. Yes. I know we will get comment on that issue, 
and it is something we certainly would consider and talk with 
States about.
    Mr. Doyle. And finally, let me ask you about nuclear, too. 
Several nuclear generating stations have closed recently, and 
it is common knowledge that others are on the bubble and I 
realize the main culprit is market conditions, but market rules 
in competitive markets disadvantage base load power including 
nuclear.
    Can we meet the greenhouse gas rules goals if more nuclear 
plants close? And since most nuclear plants operate in 
competitive deregulated markets, did you consider this in your 
analysis?
    Ms. McCabe. So the nuclear question is an interesting and a 
complicated one, and we did recognize what you have just 
reflected going on in the market with respect to nuclear 
plants. So we actually have tried to send some signals in the 
proposal to encourage the retention of that nuclear generation 
that, as you say, is kind of on the bubble. So we definitely 
would like to work with States to see how the plan can help 
encourage the continued operation of those zero emitting carbon 
sources.
    Mr. Doyle. And finally, let me ask you about reliability, 
too. I mean, one of the most important duties that State 
regulators have is to maintain a reliable electric system and 
that is vital to our economy, obviously. How does the EPA's 
proposal ensure that States can achieve carbon pollution 
reductions while maintaining reliability?
    Ms. McCabe. Yes, it is a very good question and one that 
was paramount in our minds as we worked through the proposal 
and also as we consulted with FERC and DOE and other agencies 
that have this as a chief responsibility. So there are a couple 
of things that we think make it clear that reliability will not 
be threatened.
    One is the length of time for implementation here. There is 
a long period of time for people to plan, and the utilities 
sector, this is what they do. They know how to do this, and if 
you give them enough time, they can plan accordingly.
    The flexibility in the plan, the fact that no particular 
plan is required to meet any particular emission rate over any 
particular time period is another way in which reliability will 
be protected, because States have the flexibility to plan their 
resources accordingly, and the fact that we have an annual 
averaging periods and longer averaging periods, again, provides 
a lot of flexibility. If somebody needs to bring a plant up to 
deal with a short-term issue, an annual average allows them to 
do that without compromising their compliance with their own 
plan.
    Mr. Doyle. Thank you.
    Thank you, Mr. Chairman.
    Mr. Whitfield. At this time, recognize the gentleman from 
Texas, Mr. Olson, for 5 minutes.
    Mr. Olson. I thank the Chair.
    Ms. McCabe, I hope you have the same concerns I hear back 
home about President Obama's announcement on new regulations 
for coal power, carbon regulations. There is a common theme 
back home: Why does the EPA that works for me want to kill my 
job? Why does that same EPA that works for me want to hurt my 
family? Those questions can't be answered here. They will be 
answered in November.
    I do have a few questions you can answer today. The first 
few follow the example of Chairman Emeritus Dingell that 
require a yes-or-no answer.
    Question one: EPA added a grid safety valve in the 2011 
mercury rule as a way to slow implementation if reliability is 
threatened. Now America's impartial grid operators, including 
the ones that keeps the lights on at your headquarters, have 
asked your staff about a similar valve here. My question is, 
Will you commit to including a reliability valve in the final 
carbon rule? Yes or no.
    Ms. McCabe. I can't commit to anything in the final rule. 
We haven't even gotten the public comments yet, but it is 
something we will certainly consider if people comment on it.
    Mr. Olson. It is important, ma'am. We will follow up later 
on this.
    Second question is: EPA has justified these new rules to 
the public with up to $90 billion in, quote, ``climate and 
health benefits,'' unquote. Health benefits is an important 
phrase. According to the EPA's impact analysis, the vast 
majority of this rule's benefits come from cutting traditional 
pollution, not carbon. Mostly microscopic dust, PM. We already 
regulate PM. In fact, you are just now starting to implement a 
brand new ambient air quality standard. My question, being yes 
or no, is, Do EPA's national ambient air quality standards 
fully protect human health with, quote, ``an adequate margin of 
safety,'' unquote? Yes or no.
    Ms. McCabe. Yes, they do.
    Mr. Olson. That is what I thought. That complies with the 
law.
    The second question: The entire country would have to apply 
with the existing PM 2.5 standard in the coming years, yes or 
no?
    Ms. McCabe. I am sorry. Can you repeat that?
    Mr. Olson. The entire country, all of America, will have to 
comply with the existing 2.5 PM standards in the coming years, 
yes or no?
    Ms. McCabe. That is the air quality standards that States 
need to meet, yes.
    Mr. Olson. Yes, ma'am. Many parts of the country already 
meet the new PM rule. Is that correct? Yes or no.
    Ms. McCabe. Yes.
    Mr. Olson. OK. That begs the question, your scientists have 
just approved a rule designed to push us to perfectly safe 
levels of PM. Existing rules will protect America's health and 
then some, and yet this new rule says that there will be 
billions in new PM protection benefits for EPA to trumpet to 
the public, and that begs the question, Is EPA giving this 
carbon rule credit for what it is already doing? Are you double 
counting?
    Ms. McCabe. Well, there are two answers to that, 
Congressman.
    One is that the PM rule that was just finalized is the 
standard. It is not the path to get there, and so States will 
need to implement measures in order to reduce PM to meet that 
standard, and this proposed plan would be one way for them to 
do that. So it could be a critical element of a State's PM 
compliance plan.
    The second answer to your question, Congressman, is that 
the scientists show that there are health benefits from 
reductions of PM even below the standard. We set the standards 
to protect from a public health perspective at the national 
level, but there continue to be health benefits, real health 
benefits that are experienced by people when those particle 
pollution levels go down, and so it is appropriate, in our 
view, to reflect the benefits that will accrue from those 
further reductions.
    Mr. Olson. I have a letter here that you put out in 
December 2012 and January of 2013, a fact sheet on the PM 
standard. I want you to square your comments with this 
language. It says, and this is your document: ``Emission 
reductions from EPA and States rules already on the books will 
help 99 percent of counties with monitors meet their revised PM 
2.5 standards without additional emission reductions.'' You are 
already there. Why do the standards? You have said it. You are 
there.
    Ms. McCabe. Well, these standards are not driven by PM 
reductions. These standards are driven in order to reduce 
carbon, which is a climate change pollutant causing significant 
health and welfare and economic impacts in this country. The 
benefits that we reflected in terms of PM are additional health 
benefits that will be achieved as a result of implementing this 
carbon pollution rule and but will be real health benefits that 
Americans will experience.
    Mr. Olson. My time is expired.
    Mr. Whitfield. The gentleman's time has expired.
    At this time, recognize the gentlelady from California, Ms. 
Matsui, for 5 minutes.
    Ms. Matsui. Thank you, Mr. Chairman, and thank you for 
having this hearing today.
    Ms. McCabe, I want to applaud the administration in the EPA 
for the release of this critically important proposed rule to 
cut carbon emissions from existing plants. Now, we already set 
limits for other air pollutants, but we let power plants 
release as much carbon pollution as they want, yet the effects 
of climate change are already being felt across the Nation. 
Droughts are becoming more severe, which is putting an 
incredible strain on water supply in California, and 
specifically my district in Sacramento, where we have 
experienced historic drought. In addition, extreme weather from 
hurricanes to heat waves is hitting communities across the 
country. We can't wait any longer. We have to do something.
    In California, as you know, we have made great strides with 
a cap-and-trade program, energy efficiency programs and 
renewable energy portfolio standards. Nationally, we have 
already made progress by moving to cleaner sources of energy 
and improving the energy efficiency of our cars, trucks and 
buildings. Now, EPA is setting carbon standards for power 
plants to protect public health and welfare, and I support 
these efforts in making our communities and planet a cleaner 
and safer place.
    Now, my State has a lot of companies who have invested in 
other States. How will EPA determine who gets credit towards 
compliance when one State or company has invested in renewable 
energy, and clean energy production in other States? I know 
that EPA has asked for comment, but we are hoping that the EPA 
encourages a fair way of assigning credit.
    Ms. McCabe. Yes, we look forward to the public comment on 
this and to discussions with people. Basically, we start from 
the perspective of States being responsible for the carbon 
emissions in their States, but we recognize that there are 
programs like renewable energy programs where systems are set 
up so that States or companies will invest in renewable 
resources that are outside State boundaries. So the proposal 
does contemplate letting those States take account of those 
investments as part of their plan.
    Ms. Matsui. So does California get credit, then, for energy 
efficiency programs that deal with imported electricity?
    Ms. McCabe. The energy efficiency is a little bit different 
from renewable energy. So we are focused there in the proposal 
on energy efficiency that takes place in the States that 
reflects reductions in use in that State.
    Ms. Matsui. OK.
    Ms. McCabe. But, again, I am sure we will get lots of 
comment on this issue because it is a complicated one, and you 
want to make sure that, both, you are not double counting, but 
also that all energy efficiency is being counted somewhere in 
the right place.
    Ms. Matsui. Absolutely. Now, will the EPA have ongoing 
oversight of State plans or multi-State plans?
    Ms. McCabe. Like we do throughout the Clean Air Act, we 
will provide oversight to the State implementation of approval 
and implementation of plans as we normally do with State 
implementation plans for other pollutants.
    Ms. Matsui. OK. Now, California would have to convert EPA's 
rate-base standard to a mass-based standard due to programs it 
has in place. Will this conversion affect this reduction 
target?
    Ms. McCabe. It should work out to be just exactly the same; 
that is the whole point. And we have a technical support 
document that walks States and others through how you would do 
that conversion.
    Ms. Matsui. OK. Now, would California get credit towards 
compliance for its new Pacific coast collaborative with Oregon, 
Washington, and British Columbia. The leaders of all four 
jurisdictions have agreed to account for the cost of carbon 
pollution and that where appropriate and feasible make programs 
to create consistency and predictability across the rejudge of 
53 million people?
    Ms. McCabe. Yes. So if States choose to join with other 
States in a plan, they would be able to pool their resources 
and pool their targets and be able to put in a joint plan that 
we could review and approve. That provides a lot more 
flexibility, those can be very attractive arrangements.
    Ms. Matsui. OK. Great. Now, did EPA find any parts of the 
country that don't have the potential to boost their use of 
cleaner energy?
    Ms. McCabe. No, every State has many opportunities.
    Ms. Matsui. OK. If a State does not comply or create a 
plan, can it affect a neighboring State's reduction target?
    Ms. McCabe. No, I don't believe so. Each State is 
responsible for its own target, and as I said, if they go in on 
a joint plan with others, then we would look at that as a joint 
plan, but each State is responsible for itself.
    Ms. Matsui. OK. There is an interim reduction goal that 
must be met by 2020. What happens if the State does not meet 
the interim standard?
    Ms. McCabe. Well, actually the interim standard needs to be 
met on average over the decade between 2020 and 2029, so they 
can kind of plan that out.
    Ms. Matsui. All right.
    Ms. McCabe. They don't have to have a straight trajectory. 
There can--there is some States, for example, that know they 
are going to have plant closures later in the decade so they 
can do less in the first part.
    Ms. Matsui. OK.
    Ms. McCabe. So, each State's plan will lay out what it 
expects to do over that 2020 to 2029 period and show how it is 
getting that average.
    Ms. Matsui. OK.
    Ms. McCabe. And then we will work with the States to help 
them along the way.
    Ms. Matsui. Great. Well, thank you, Ms. McCabe.
    I yield back.
    Mr. Whitfield. The gentlelady's time is expired.
    At this time recognize the gentleman from Kansas, Mr. 
Pompeo, for 5 minutes.
    Mr. Pompeo. Thank you, Mr. Chairman.
    I want to follow up on a question from Mr. Whitfield. He 
asked you for precedent about going beyond the source under 
111(d), and you cited the Clean Air Mercury Rule. Are there 
other precedents that EPA has for going beyond regulating 
existing sources?
    Ms. McCabe. Well, we actually don't think this is going 
beyond existing sources because it is focused on the fossil 
generation, and all----
    Mr. Pompeo. But you gave that example where you have gone 
beyond the actual source, and you cited the Clean Air Mercury 
Rule. Do you have other examples like the Clean Air Mercury 
Rule, yes or no?
    Ms. McCabe. No. The other examples, though, are industry 
specific like this one is.
    Mr. Pompeo. Right. And under the Clean Air Mercury Rule, 
there is nothing outside of regulated sources that you attempt 
to regulate. You could trade among the regulatories.
    Ms. McCabe. Correct.
    Mr. Pompeo. But you couldn't go beyond that to appliances 
as you are proposing here; is that correct? It is a yes or no 
question.
    Ms. McCabe. That is right.
    Mr. Pompeo. And my recollection is the Clean Air Mercury 
rule was overturned.
    Ms. McCabe. But not on that basis.
    Mr. Pompeo. But it is no longer in effect.
    Ms. McCabe. It is no longer.
    Mr. Pompeo. Right. So, it is gone. It was unlawful, it was 
lawless, much like you are proposing here. Yes.
    Let me talk about--but have you met with John Podesta in 
the course of developing these regulations?
    Ms. McCabe. I have.
    Mr. Pompeo. How many times?
    Ms. McCabe. I don't recall.
    Mr. Pompeo. One time, three times, five times, do you have 
an estimate?
    Ms. McCabe. Not that----
    Mr. Pompeo. Do you have a parking----
    Ms. McCabe. Not----
    Mr. Pompeo [continuing]. Spot at that building? Is it 
infrequent?
    Ms. McCabe. It is infrequent.
    Mr. Pompeo. OK. How many times has your staff met with him 
or someone else at the White House on this set of regulations?
    Ms. McCabe. Not to my knowledge, or infrequently.
    Mr. Pompeo. And Ms. McCarthy, has she met with Mr. Podesta 
as well on this set of regulations?
    Ms. McCabe. I expect that she has.
    Mr. Pompeo. Can you give me the information about the 
frequency of those meetings, the location of the meetings, and 
the subject matter of those meetings?
    Ms. McCabe. I will take that back.
    Mr. Pompeo. No, that is not the question. The question is 
can you get me the information?
    Ms. McCabe. I know. I will take the question back.
    Mr. Pompeo. Great. I mean, this is about politics, right? 
That is why Mr. Podesta is over at EPA working on this. This 
isn't about law, we talked about that. It is about politics. It 
is also not about science, and I want to turn to science now.
    I talked with Ms. McCarthy about this. I want to make sure 
nothing has changed in your view. So you have now 30 
indicators. You have gone from 26 to 30 indicators on your Web 
site about how you measure impact of what you all call climate 
change today.
    So I want to ask you a series of yes-or-no questions about 
this set of regulations, these carbon regulations, and what you 
think they will do to the indicators that EPA uses.
    So, yes or no, will this set of rules, when fully 
implemented, reduce sea surface temperatures.
    Ms. McCabe. I can't answer that. I don't know.
    Mr. Pompeo. Will this reduce ocean acidity?
    Ms. McCabe. It will contribute to reducing ocean acidity.
    Mr. Pompeo. Do you have the data to support that, and can 
you tell how much and when we will see reduced ocean acidity as 
a result of these regulations?
    Ms. McCabe. You can't predict the climate this way.
    Mr. Pompeo. I will take that as you have no idea. Is that a 
fair statement? You don't know. You have no data. Do you have 
any science to support the reduction in ocean acidity connected 
to these rules?
    Ms. McCabe. We have science to show that increased carbon 
in the atmosphere leads to things like ocean acidity, and if 
you have less carbon in the atmosphere, you will----
    Mr. Pompeo. Decreases in the lake ice. How much--how much 
less lake ice will there be as a result of this set of rules?
    Ms. McCabe. Same answer I gave you before.
    Mr. Pompeo. Right. You don't know. The answer is you can't 
show me how much less lake ice. I would just like to see the 
data. If you are proposing a set of rules and you have 
indicators, it would seem reasonable for the citizens of 
America to demand that you say, ``Hey, we think this is the 
impact, and so we will--this is what you are going to get in 
exchange for all the costs that we have all talked about this 
morning, this is what you are going to get. You are going to 
get this much less--or this much more of something that is 
really good.''
    Ms. McCabe. But that is not the way climate science works.
    Mr. Pompeo. Right. Yes. Science used loosely.
    Have you met with FERC in connection with electrical 
reliability and talked to them about the impact?
    Ms. McCabe. Yes.
    Mr. Pompeo. And tell me about those discussions. Did you--
were there memos? Are there written materials where FERC 
provided you information about what they thought the impact of 
these rules would be on electricity reliability?
    Ms. McCabe. So, I or my staff have consulted with staff at 
FERC. They are part of the interagency review process that we 
always go through, and so they have given us their input on 
electric reliability.
    Mr. Pompeo. And do you have--when you say their input, is 
there a memo? Do you have a document? Or did you just pass in 
the hallway and talk? There has got to be a written document.
    Ms. McCabe. I don't believe there are written documents, 
but it was more than passing in the hallway. We had discussions 
with them.
    Mr. Pompeo. They were just discussions about something that 
is critical as electrical reliability. We have such a radical 
rule, and you didn't ask them to put anything in writing or you 
didn't demand and say, hey, tell us what you think in a formal 
scientific manner. You just said, hey, let's sit at a table and 
talk about it?
    Ms. McCabe. We had substantive discussions with them.
    Mr. Pompeo. Mr. Chairman, I yield back.
    Mr. Whitfield. The gentleman yields back.
    At this time I recognize the gentleman from New York, Mr. 
Tonko, for 5 minutes.
    Mr. Tonko. All right. Thank you, Mr. Chair, and 
Administrator McCabe, welcome, and thank you for your work on 
EPA's Clean Power Plan.
    The President and EPA are doing exactly the right thing by 
placing the limits on the amount of carbon pollution that can 
be emitted from power plants. Climate change is a serious 
threat, as we all know, and we cannot address it without 
addressing the biggest source of carbon pollution in the United 
States.
    In the 2 weeks since the release of EPA's proposed rule, we 
have heard a lot of attacks on the Clean Power Plan, so I want 
to give you a chance, Administrator, to clear up some of these 
misunderstandings. One of the claims is that no one goes to the 
hospital for breathing in carbon pollution so there can't be 
any real public health benefits from limiting carbon pollution. 
Could you please explain how this rule will help protect the 
public health from the effects of both conventional air 
pollution and carbon pollution?
    Ms. McCabe. Yes, thank you. People do go to the hospital 
for breathing issues and for other ailments that are caused or 
exacerbated by air pollution, so this rule will--by reducing 
both carbon but also other ancillary pollutants that are 
emitted by coal-fired and other fossil fuel-fired power plants, 
will reduce the amount of air pollution in the air, that means 
fewer asthma attacks, fewer visits to the emergency rooms, 
fewer premature deaths, and fewer heart attacks resulting from 
exposure to those pollutants.
    Mr. Tonko. Right. There is also talk about the impact on 
modest income households. I can tell you representing 
households that saw their life savings washed away when their 
homes were totally destroyed is an effect that is never totally 
recovered, and so, the inaction here can be very expensive.
    We have also heard repeatedly that the Clean Power Plan is 
a heavy-handed attempt by EPA to regulate the power system and 
to tell States exactly how much efficiency in renewable energy 
they must achieve. This charge must particularly be--must be 
particularly frustrating for you. As I understand it, the 
proposal is designed to offer flexibility, as you have 
mentioned here today. The proposal sets a target, but it is 
left, is it not, to individual States to choose how to achieve 
it? Can you respond to this misrepresentation of the proposal?
    Ms. McCabe. Yes, it is absolutely left to States, and we 
know that States will pick and choose the things that make the 
most sense for them, and if energy efficiency is where they 
want to put their investment, then they have the ability to do 
that. If investing in their existing coal-fired generation can 
make it just as efficient as possible is where they want to put 
their investment, then the plan allows them to do that.
    Mr. Tonko. Right. Thank you. And then, Administrator 
McCabe, I am sure that you are aware that New York is a member 
of the nine State compact of Regional Greenhouse Gas 
Initiative, or RGGI in the Northeast. Our nine State coalition 
has agreed to a cap on carbon pollution, and we have a regional 
trading market for carbon pollution credits.
    The revenue from the sale of those credits has allowed us 
to fund a wide variety of initiatives, including efficiency and 
renewable energy, investment in education and training for 
jobs, new jobs in clean energy, transitioning of jobs, and 
support businesses and initiate plans for climate adaptation. 
In short, the RGGI States have accomplished much already.
    In fact, since 2009, the nine member State compact has had 
an emission reduction by 18 percent, while our economies grew 
by 9.2 percent. By comparison, the emission in the remaining 41 
States of our Nation, saw that emission reduced by 4 percent 
while their economies grew by 8.8 percent. So the track record 
is not intimidating. It is actually quite rewarding.
    It appears to me that what States are doing under RGGI is 
consistent with EPA's proposal. So the States in our coalition 
are already on their way to meeting your proposed target. Is 
that the case, or are we going to have to rework our 
initiatives?
    Ms. McCabe. No, that is the case, and the approach that 
these States have taken is certainly one approach that States 
can choose to take, and as you say, has been very beneficial to 
those States and very workable.
    Mr. Tonko. OK. Well, I appreciate that because I was 
involved in the early discussions about the formation and 
implementation of RGGI from my seat at NICERTA. I heard many of 
the States claim--the same claims about threats to reliability 
and affordability of electricity, job losses, and predictions 
of everything short of returning to the days of reading by 
candlelight. It didn't happen. I won't say these aren't 
challenges. There are challenges, but they are manageable, and 
the effort is yielding significant benefits for public health 
and the economy.
    Ms. McCabe, proponents of action to address climate change 
say that requiring coal-fired power plants to control their 
carbon pollution is a part of a war on coal. Is the Clean Power 
Plan going to eliminate the use of coal?
    Ms. McCabe. Absolutely not. In fact, coal will remain 
roughly a third of our power supply in this country in 2030 
under this proposed plan.
    Mr. Tonko. OK. Well, my time has been exhausted, so I will 
yield back, and I thank you for, again, appearing before us 
today and offering clarification.
    Mr. Whitfield. At this time, recognize the gentleman from 
Virginia, Mr. Griffith, for 5 minutes.
    Mr. Griffith. I have to just say, representing a coal 
district where lots of jobs have been lost and more expected to 
be lost because of these rules, we certainly feel like we are 
under attack from Washington, DC, and if it is not a war, it 
sure is something that is pretty close to hell. Thank you.
    That being said, it is my understanding--and if I could get 
yes or no answers, I would appreciate it. It is my 
understanding that you are a lawyer by training; is that 
correct?
    Ms. McCabe. I am.
    Mr. Griffith. And it is also my understanding that the 
Attorney General of West Virginia, Patrick Morrisey, wrote a 
letter to Gina McCarthy on June 6, 2014, regarding these new 
rules. In there, I understand the EPA agrees in its technical 
documents filed with this proposal that under the plain reading 
of the statutory language of section 111(d) found in the U.S. 
Code, EPA has no legal authority to regulate CO2 
emissions from power plants under section 111(d). In 
particular, section 111(d) of the U.S. Code provides that if 
the EPA is already regulating a source under section 112 of the 
Clean Air Act, the EPA cannot also establish standards under 
section 111(d) for those same sources.
    Isn't it true, that in 2012, EPA started regulating power 
plants under section 112 under its Mercury and Air Toxics Rule? 
Yes or no.
    Ms. McCabe. We did issue a regulation under section 112.
    Mr. Griffith. Under section 112. So, under the plain 
reading of the U.S. Code, and by the way, a plain reading of 
the legislation reported from this committee and the 
substantive provisions of law enacted by the House and the 
Senate, this decision by the EPA foreclosed, the decision to 
regulate under 112 foreclosed the agency's ability to regulate 
greenhouse gases under section 111. Isn't that correct?
    Ms. McCabe. That is not correct.
    Mr. Griffith. And you base that upon your new understanding 
that the EPA takes the position that they don't read the 
provisions of the U.S. Code literally because there was a 
technical conforming amendment included in the 1990 Clean Air 
Act amendments that you all assert, you and the EPA assert 
creates ambiguity in what is the law or about what the law is; 
is that your position, ma'am?
    Ms. McCabe. This is not a new interpretation. This is the 
interpretation that the agency took in 2005 also in the Clean 
Air Mercury Rule, that reading of the statute.
    Mr. Griffith. And do any of the following still work for 
the EPA: Carol Holmes, Howard J. Hoffman, or Wendy L. Blake?
    Ms. McCabe. Yes, some of them.
    Mr. Griffith. So then the court, in its ruling, made an 
error when it said that your position was the opposite of what 
you have said just. I read from the opinion that you 
referenced, that would be New Jersey versus EPA, 2008 opinion. 
For all the lawyers listening in, 517 F.3d 574, quote, ``This 
requires vacation of CAMRs regulations, for both new and 
existing EGUs. EPA promulgated the CAMR regulations 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 section 112. EPA thus concedes that if 
EGUs remain listed under section 112, as we hold, then the CAMR 
regulations for existing sources must fall. EPA promulgated the 
CAMR regulations for new sources under section 111(b) on the 
basis that there would be no section 112 regulation of the EGU 
emissions and that new source performance standards would be 
accompanied by a national emissions cap and voluntary cap-and-
trade program,'' end quote.
    From the opinion that you just said where your people 
argued the opposite, the courts seem to think they argued what 
I think, and that is, you don't have authority if you regulated 
greenhouse gases under 112, you don't have the authority--not 
greenhouse gases, but regulated the existing coal-fired power 
plants, you don't have the authority under 111. How do you 
reconcile those two, your thought that this was your position 
before and now finding that your lawyers had previously argued 
the opposite, at least if the court is not mistaken,and I note 
that the case was appealed on other grounds but cert was not 
granted?
    Ms. McCabe. The CAMR decision was based on a completely 
different basis, the decision to vacate the rule.
    Mr. Griffith. I understand that, but you just stated here 
today that your position--this was not a new position for the 
EPA because of this case. This case says the opposite. How do 
you reconcile that?
    Ms. McCabe. I am not intimately familiar with the court 
decision that you are reading. I will be happy to respond to 
this, and I am sure we will.
    Mr. Griffith. I appreciate that. Let's just talk about good 
basic lawyering then. You know what a scrivener's error is. You 
have been around the process for a long time, you have gone to 
law school, you understand that when a bill passes, and this 
committee does it all the time, when we say at the end, our 
chairman will say that, you know, closes by saying the staff 
can make technical conforming amendments, what the EPA is 
hanging their hat on is a scrivener's error that was a 
confirming amendment, and you are saying that a scrivener's 
error and the conforming amendment should trump the law of the 
United States? Really. With your background and your education, 
I would expect a better argument.
    Thank you very much, Mr. Chairman, I yield back.
    Mr. Whitfield. The gentleman yields back.
    At this time I recognize the gentlelady from Florida, Ms. 
Castor, for 5 minutes.
    Ms. Castor. Thank you very much, Mr. Chairman, and welcome.
    I think it is very heartening that America is moving 
forward to tackle the challenges of the changing climate and 
carbon pollution. We are already making great progress when it 
comes to the cars we drive and fuel efficiency. We have reduced 
emissions substantially and put money back into the pockets of 
American families. That has been very positive.
    Then look at what has happened with the appliances in our 
homes. They are more efficient than ever, and we can do even 
better, the building codes are better. New technology is out 
there so you can control with your smart phone what is going on 
in your own home and save money that way. Again, the new 
technology is improved by leaps and bounds, and this is part of 
American ingenuity, and we are going to bring that same 
ingenuity to tackling carbon pollution from the largest 
emitters.
    Back home, all I have to do is look around the Tampa Bay 
area on top of the huge Ikea store, we have got large solar 
arrays, they are saving on their electric bills, the largest 
beer distributor in the area has a major warehouse. They said 
this makes sense for us now to put solar panels on the roof. 
Our local governments have done it at courthouses, and there is 
a corresponding benefit that we have created jobs and clean 
energy, and we have created new businesses, and we are boosting 
small businesses all across my community and all across 
America.
    So now comes another important piece in the climate action 
plan focused on the largest sources of carbon pollution, and 
when you review the proposed rule by EPA, I think the hallmark 
of it is the flexibility granted to the States. So, by the year 
2030, it is almost hard to imagine where we will be at 2030, 
but by 2030, States will have to meet these overall pollution 
reduction goals.
    Now, some people expressed to me, Madam Administrator, that 
the rule grants too much flexibility. A State like mine in the 
State of Florida at the State level, we don't have much State 
leadership right now, surprisingly. The State, I would argue, 
that could be the most impacted by the changing climate, the 
leaders at the State level had receded from energy efficiency 
standards. We don't have any renewable goal at all, so some 
folks say, gosh, couldn't have EPA done a little bit better by 
setting some targets on energy efficiency and renewables? But I 
mean, Mr. Barrow, Georgia is producing more solar power than 
the Sunshine State. That is pretty ridiculous. So----
    Mr. Barrow. It is a point of pride.
    Ms. Castor. Point of pride for you in the Peach State but 
not so much from the Sunshine State, but there is progress at 
the local level. Like in my home county in Hillsborough County, 
they have a waste energy plant that has been expanded, they are 
getting greenhouse gas credits. The city of St. Petersburg is a 
leader nationally in what they are doing in lighting and solar 
power and eliminating methane and waste energy, so here is a 
question.
    What will States be able to do to harness the improvements 
at the local level? And it is not just local governments. It is 
nonprofits and it is businesses. How will that count towards 
our goal, our State goal of reducing overall carbon pollution?
    Ms. McCabe. This is a great point. I think there is 
something like a thousand mayors across the country that have 
pledged to address carbon emissions in their cities, and it is 
just so encouraging and so positive, and the way these programs 
will fit into a State's plan is that any measure that helps the 
State reduce the amount of energy it needs to produce from its 
high carbon sources will be able to be counted in the State's 
progress towards their goal. So, all these local programs, 
weatherization programs, building efficiency programs, they all 
will be able to count.
    Ms. Castor. But you all have a State organization that will 
able to bring all of that data together; isn't that right?
    Ms. McCabe. Well, the State Government is responsible for 
the plan under the Clean Air Act, as they always are, and they 
know how to do these things, and so we are working with the 
State agencies that are definitely thinking about how they will 
do this and asking lots of questions, and I think they have the 
opportunity to work with their mayors and their utilities and 
their local businesses and utilities to make sure they know 
what is going on and----
    Ms. Castor. It is really a call to action to everyone. We 
all have a responsibility to do this, and I think there is a 
great potential for cost savings for consumers. It is 
interesting that you have identified a potential for reduced 
electric bills because of energy efficiency. If you can save, 
you save money, but one of the problems, though, is the State 
incentives, do not encourage energy efficiency and 
conservation. Hopefully we can do better there, don't you 
think?
    Ms. McCabe. We think States will find that energy 
efficiency is a very positive program for them to invest in as 
some other States that are further along that path have found.
    Ms. Castor. Thank you very much.
    Mr. Whitfield. At this time, recognize the gentleman from 
Texas, Mr. Burgess, for 5 minutes.
    Mr. Burgess. Thank you, Mr. Chairman. I appreciate you 
having the hearing.
    I appreciate our witness being here so long with us this 
morning and your forbearance through our questions.
    I want to go back, I think it was Mr. Barton or maybe it 
was Mr. Shimkus who asked the question to which you responded 
that there would be an 8 percent reduction in electricity 
prices in Texas; did I hear that correctly?
    Ms. McCabe. Electricity bills. We predict that electricity 
bills will go down. This is a national average, not----
    Mr. Burgess. Can you provide us with the formula and the 
data that you put into the formula to come up with that answer?
    Ms. McCabe. Sure. That is all laid out in our regulatory 
impact assessment, and the attachment is in the record, so we 
will be happy to point you to where that is.
    Mr. Burgess. You also said in your opening statement, that 
we will avoid 100,000 asthma attacks under these rules. Can you 
tell us, since the passage of the Clean Air Act, when I wasn't 
here then--I mean, that was before the earth cooled the first 
time, it has been so long ago--but how many asthma attacks have 
been prevented under the Clean Air Act?
    Ms. McCabe. I don't know that figure, but we will be glad 
to get you some more information on that.
    Mr. Burgess. Does this figure of 100,000 include those 
asthma attacks that would have been avoided simply because of 
the passage of the Clean Air Act?
    Ms. McCabe. The health benefits that we predict from this 
rule are associated with the pollution reductions that are 
required by this proposal.
    Mr. Burgess. Well, now you say pollution reduction, but of 
course, this all was predicated on the endangerment finding for 
carbon dioxide, and now carbon dioxide has become a regulated 
pollutant; is that correct?
    Ms. McCabe. That is correct.
    Mr. Burgess. So is regulation or reduction of carbon 
dioxide in the atmosphere going to result in 100,000 fewer 
asthma attacks?
    Ms. McCabe. The asthma attacks that we associate with this 
rule in our analysis are due to reductions in other pollutants 
that will happen as the carbon is also reduced.
    Mr. Burgess. Can you provide us with the journals that back 
up the 100,000 figure as well as the reductions that you are 
asserting.
    Ms. McCabe. We will be happy to point you to where in the 
record we lay out our expectations on the benefits.
    Mr. Burgess. I am really not interested, but what I really 
would like to see are, are there publications in refereed 
journals that will attest to this fact? The ones that I have 
been able to find really are rather nebulous about the finding 
that reduction of carbon dioxide means a lower number of asthma 
attacks.
    Ms. McCabe. We will be glad to follow up with you.
    Mr. Burgess. And in note planning, I brought my Harrison's 
Principles of Internal Medicine with me this morning just in 
case we wanted to look at it. I don't see carbon dioxide listed 
as a trigger for inciting reactive airway disease.
    Ms. McCabe. So, let me clarify because I think I didn't 
quite see where you were going. So, there are certain airborne 
pollutants that are very clearly associated with exacerbation 
of asthma attacks. The impacts that we are seeing from climate 
change also can create conditions in which asthma can be 
exacerbated, so----
    Mr. Burgess. May I stop you there for just a moment because 
you seem to conflate climate change with carbon dioxide. My 
understanding of the purpose of this rule was because of an 
endangerment finding from carbon dioxide, and the asthma 
reductions that you are asserting in your testimony this 
morning are as a result of reductions in carbon dioxide.
    Ms. McCabe. No, that is not correct, so let me be really 
clear. The endangerment finding found that emissions of 
greenhouse gases, including carbon dioxide, created adverse 
impacts to public health and welfare, and that is through a 
variety of impacts that a changing climate has, increasing 
heat, increasing bouts of----
    Mr. Burgess. Again, I need to stop you because of time 
considerations, but those are relatively nebulous. And when I 
review the literature, I don't see the--I mean, this is a 
fairly assertive statement that you have made for the record 
here in your opening statement, and I don't see the data to 
back that up.
    But I would just ask that you be careful about the language 
because the language--I think I see why that language is being 
used, but I don't think it is fair to use that, and I think, 
you know, we are oftentimes accused of using fear to motivate 
people to be against some of these principles, but here, I 
believe you are using fear, who wants more asthma attacks? No 
one. But your assertion that asthma will be reduced by 100,000 
because of reductions of carbon dioxide in the rule that you 
promulgated as a result of a court opinion, I am sorry, it just 
doesn't follow.
    Ms. McCabe. If I could be really clear then. The health 
benefits that we describe as a result of this rule, the asthma 
attacks, in particular, are the result of the reductions in 
other pollutants that will happen accompanying the reductions 
in carbon.
    Mr. Burgess. So, I would just simply ask, what have you 
been doing? Why haven't you reduced those other pollutants? Why 
did it take this activity to motivate the EPA to reduce those 
other pollutants if it was within their power to do so all 
along under the Clean Air Act?
    Ms. McCabe. EPA and the States have been working for many 
years to reduce air pollution that results in asthma attacks 
and other health effects and has made a lot of success along 
the way.
    This is an additional program that will result in 
additional pollution reductions, and there are real health 
benefits associated with those.
    Mr. Whitfield. The gentleman's time is expired.
    Mr. Burgess. Mr. Chairman, I have some additional 
questions. I will submit those for the record. I appreciate 
your indulgence.
    Mr. Whitfield. Absolutely, yes, we do have some other 
questions, and we are going to have some more hearings.
    At this time I recognize the gentleman from Georgia, Mr. 
Barrow, for 5 minutes.
    Mr. Barrow. Thank you, Mr. Chairman.
    Thank you, Ms. McCabe, for being here.
    I am sort of in a lonely place in this committee, you know. 
Sometimes I think a lonely place is the only honest place to be 
in this town, but you be the judge.
    I accept the scientific evidence of a climate change. I 
accept the scientific evidence and the common sense that tells 
me if you take all the carbon that God put down in the ground 
and belch it in the air, we are going to have an impact on 
climate sooner or later. I accept that.
    But I reject previous legislative attempts to address this 
problem, and I don't accept and don't agree with the current 
administration's efforts to do this by regulation, mainly 
because I don't think that it will work, but they will 
definitely hurt. They won't work, especially when you consider 
it in isolation or when you consider it against the backdrop of 
what is taking place in the rest of the world, and so I think 
we need to take another approach in this basically.
    And the debate between those folks that say we need to put 
mandates out that in the hopes that technology will arrive, you 
know, on time, to the rescue, and those who think you ought to 
invest in technology, I am firmly in the technology first camp, 
and I don't think we are doing that with these regulations.
    But, you talk about a number of things that we are doing 
that some folks are doing someplace, everybody ought to try and 
use those tools to try and get where we need to be. You talk 
about things like making coal plants more efficient, talk about 
shifting from coal to natural gas, talk about more renewables, 
you talk about consumer efficiency in a variety of different 
ways. Nowhere in there did I hear you talk about shifting from 
coal to nuclear.
    Of the existing technologies that are on the shelf, nuclear 
is the only one that can provide significant base load capacity 
with zero emissions. My question is, does shifting from coal to 
nuclear count? Should it count?
    Ms. McCabe. It should and it does.
    Mr. Barrow. All right. In Georgia and in South Carolina, we 
are the only ratepayers I know of in the Nation making 
significant investments in shifting from coal to nuclear. In my 
district at Plant Vogtle, we are adding the two next nuclear 
power generators to come online in this county. Vogtle 3 is 
going to come online in 2017. Vogtle 4 is going to come on in 
2018. How are they going to get counted toward the goals they 
are going to be held to in 2020 of getting down to 891 pounds 
per kilowatt hour?
    Ms. McCabe. So when those megawatts are produced by a 
nuclear plant with zero carbon and they replace megawatts that 
were produced by a plant that emitted carbon, those will be 
counted for the State, and they will help it get towards its 
final goal.
    Mr. Barrow. So, you are telling me the time between these 
come online in 2017 and 2018, the reductions that take place 
then will be counted toward the goal that you set for us of 
getting 891 as the adjusted average?
    Ms. McCabe. They will, and with those plants as part of 
Georgia's----
    Mr. Barrow. Base.
    Ms. McCabe [continuing]. Base and how they produce their 
power, that it will help address, or achieve the carbon 
intensity goal, absolutely.
    Mr. Barrow. Well, let me put this in context. In 2005, 
Georgia utilities were belching about 2,000 pounds per kilowatt 
hour into the atmosphere, and we have already achieved a 25 
percent reduction in that amount, getting down to about 1,500 
as of 2012. So in the 7 years between 2005 and 2012, we have 
already achieved a 25 percent reduction.
    Now, against the President's goal of achieving a 30 percent 
reduction for 2005 to 2030, how come we haven't already gotten 
there? Why are we still being required to cut it from 1,500 
down to 891 in 2020 and 834 in 2030?
    Ms. McCabe. Well, each State is in a different place and 
they have made different progress, but what we did in our rule 
was we looked at these reasonable and existing technologies 
that people can use and how much more is reasonably able to be 
done.
    Mr. Barrow. My point is, though, we are already achieving a 
25 percent reduction and are shifting from coal to natural gas. 
One of tools in the toolbox you say we have got, and we have 
got plans to shift even more from coal to nuclear in 2017 and 
2018. We have already achieved 25 percent of the starting goal 
of reducing what we were producing in 2005 to 2030 by 30 
percent. We are most of the way there. Why do we have to cut it 
in half even further?
    Ms. McCabe. This rule was not set up to achieve a specific 
goal of reduction. That is not the way it works. It was set up 
to look at what the available technologies are, and for each 
State, that results in a different trajectory and a different 
ultimate goal.
    Mr. Barrow. But we are utilizing two technologies, one you 
specifically list and one you haven't listed, need to add it to 
the mix, shifting from coal to nuclear, and we are already most 
of the way there.
    Let me put it another way. Let me put it another way. It 
makes no sense to me that a little old itty bitty State like 
Wyoming is going to be held to producing, belching, 1,700 
pounds per kilowatt hour into the atmosphere while a big old 
State like Georgia is going to be required to belch out no more 
than 834 pounds of CO2 per kilowatt hour.
    Makes even less sense to allow a little old itty bitty 
State like North Dakota to do 1,783 pounds in 2030, whereas a 
big old State like Texas has got to do no more than 700-and-
something. That makes no sense to me in terms of whatever you 
want to do, whatever the existing technologies are, and that is 
a problem I have got with this whole approach.
    Ms. McCabe. We would be glad to spend more time with you, 
Congressman, and explain how those targets got----
    Mr. Barrow. This will take a lot explaining. Thank you, 
ma'am.
    Mr. Whitfield. The gentleman's time is expired.
    At this time I recognize the gentleman from West Virginia, 
Mr. McKinley, for 5 minutes.
    Mr. McKinley. Thank you, Mr. Chairman.
    I would like to try to keep this issue in perspective and 
maybe have to get at the 30,000-foot level to look at this, 
because you know, according to the EPA's own Web site, it says 
that 82 percent of all manmade CO2 comes from areas 
outside the United States, and so, to me, it is kind of 
ludicrous, as we have this discussion, to think that we are 
going to improve--we are going to have health benefits to 
America and we are going to start reversing the climate change 
when 82 percent of those contributing to CO2 are 
exempt around the world.
    It just--I can't think of any other way that we are going 
to make this policy work than by engaging the rest of the world 
into this discussion. But this experiment that he wants at 30 
percent is just--it doesn't seem to be working. If we go back 
to the Kyoto protocol, it called for a 5.2 reduction in 
CO2 emissions, but by the end of that protocol, the 
globe had already, had increased by 10 percent and just ignored 
what was being documented.
    So, while we want to experiment, while this administration 
wants to experiment by reducing 30 percent, the International 
Energy Agency is already predicting that by 2030 the rest of 
the world is going to be producing 40 percent more 
CO2 around the world.
    While we are experimenting with reduction, the rest of the 
world is not following our lead, they are going to 40 percent. 
Just consider China and India alone. With this chart, you can 
see that, this is what they are going to be doing. Over this 
time period, China is going on the introducing 557,000 more 
gigawatts of coal-fired power house; India, 519,000. In that 
time period, by 2030, China is going to increase their 
CO2 output by 60 percent while we are decreasing 30 
percent. India is going to increase by 50 percent their 
CO2 output while we are decreasing our 30 percent.
    This administration just seems to be ignoring that China 
burns more coal than the rest of the world combined, and no one 
is following this lead. We seem to be operating in a vacuum.
    Just recently the EPA Administrator, former Administrator--
EPA Administrator Lisa Jackson said U.S. action alone will not 
impact world CO2 levels. Do you agree with that?
    Ms. McCabe. I----
    Mr. McKinley. Yes or no.
    Ms. McCabe. I take your word that she said it.
    Mr. McKinley. She said that just yesterday. Former EPA 
Administrator William Riley said, absent action by China, 
Brazil, and India, what we do will not suffice.
    Ms. McCabe. I don't think anybody disagrees that action is 
required by many countries to address climate change.
    Mr. McKinley. So what we are doing--so, with these 
regulations, we are ignoring the global reality that the rest 
of the world is not following us. We are going to affect our 
American economy. We are going to put it at risk where already 
the numbers are predicting that anywhere from $9 to $40 billion 
annually we are going to pay for this experiment.
    We are going to be increasing our utility bills. We are 
going to be putting Americans out of work. We are going to 
disrupt our manufacturing base. We are ignoring the advice of 
the predecessors with EPA over this thing, so I am going ask 
you a quick--a year from now, if China and India and Japan have 
not reduced their CO2 emissions, will you withdraw 
this regulation?
    Ms. McCabe. We are not----
    Mr. McKinely. Just yes or no.
    Ms. McCabe. No.
    Mr. McKinley. OK. How about 2 years from now? If no one is 
following, will you withdraw it?
    Ms. McCabe. Congressman, this rule----
    Mr. McKinley. Is that no?
    Ms. McCabe. I can't speak to what----
    Mr. McKinley. So, I would say in the final rule then, since 
you mention it earlier, in the final rule, you said that it is 
not final. We have--final language has to be worked out, so 
will you agree to insert metrics into this? Engineers, we deal 
with metrics. We want to see how you measure success, so will 
you put into the final bill a metric that says that if 
America's economy is tanking because of this or the world isn't 
following and they are continuing to increase their 
CO2 emissions, that this will void this rule? Just a 
yes or no.
    Ms. McCabe. I don't believe that would be an appropriate 
thing to do under a Clean Air Act rule, Congressman.
    Mr. McKinley. OK. So, again, trying to paint the final 
picture here as we go with this. This experiment in working 
separate from the rest of the Nation is kind of--and you 
yourself have mentioned, efficiency. As an engineer, I agree 
with you about efficiency, but when I think of it, what comes 
to mind is someone insulating their home and then opening all 
the windows. What have we accomplished with this? We are not 
working in concert with the rest of the world. They are not 
following us.
    So for us to expect to have health benefits from something 
while 82 percent of the rest of the world are exempt from this 
is ludicrous.
    I have to--my time is expired. I am sorry. I hope we can 
have more of a dialogue and follow back up with this. Thank 
you.
    Ms. McCabe. Happy to. Happy to. We are absolutely not 
ignoring other countries, and we have many activities focused 
on it.
    Mr. McKinley. You and I both know they are not joining us.
    Mr. Griffith [presiding]. The gentleman's time is expired.
    The gentleman from New York, Mr. Engel, is recognized for 5 
minutes.
    Mr. Engel. Thank you, Mr. Chairman. I want to welcome and 
thank you, Administrator McCabe, for joining us here and for 
your testimony.
    I want to give you a chance to perhaps answer some of the 
things--questions that Mr. McKinley asked because there are a 
couple of arguments that we hear over and over again from those 
who oppose U.S. action on climate change.
    First, they say this is a global problem so why should the 
U.S. act first, and secondly, they say even if America acts, it 
is not going to solve the problem anyway because other 
countries are going to ignore it, so why bother. As far as I am 
concerned, there is no question that climate change is a global 
problem, and it demands a global solution, and it doesn't mean 
that we wait for other countries to act first.
    So, to the contrary, I would say progress on big global 
problems almost always requires United States' leadership, and 
I don't think anyone would claim that the world will 
meaningfully make a slow climate change without U.S. leadership 
and action.
    I wanted to give you a chance to answer some of the 
specifics because it is hard when you have to answer just yes 
or no to say what you really feel, so----
    Ms. McCabe. Yes. I appreciate it, Congressman, and I agree 
with the way you have characterized this.
    There is no question it is a global issue. There is no 
question that countries beyond the United States are going to 
have to take action. This has been the case with other 
environmental problems in the past. I also agree and the 
President agrees that the United States has a responsibility to 
act here both because we are a significant contributor. We are 
the second largest, I believe, contributor, and because we are 
a world leader, and we work in the international community with 
other countries, with China, with India, with other countries, 
and are working with them to get them to look at similar sorts 
of approaches so that we can together address this global 
environmental problem.
    Mr. Engel. So on the specific issue of climate change, can 
you tell us why American leadership is particularly critical on 
this particular issue?
    Ms. McCabe. Well, the global impacts of climate change 
affect us here in the United States, they affect our citizens 
and our families, and so we have a responsibility to do 
everything that we can to encourage and work with other 
countries to have them take the kinds of steps that we 
ourselves are showing we have the leadership to take here at 
home.
    Mr. Engel. Well, and also, as you mentioned, the United 
States is one of the world's top emitters of carbon pollution, 
and in order to be a credible negotiator, I think we need to be 
able to urge and approach other countries to do more. We need 
to take action ourselves, you know, walk the walk.
    Ms. McCabe. That is correct. That is absolutely correct.
    Mr. Engel. Not just talk the talk. So how will EPA's 
actions to cut carbon from power plants, in particular, 
strengthen the United States' ability to influence the 
direction of international negotiations on climate change?
    Ms. McCabe. It already is having an impact when we meet 
with other countries in these discussions to see that a major 
world leading economy is putting its money where its mouth is, 
so to speak, and taking affirmative steps to address carbon. 
And so that shows that it can be done, it shows that a country 
has moved forward in that regard, and that puts pressure on 
other countries to do similar or explain why they can't.
    Mr. Engel. Now, power plants are the largest single source 
of our emissions and the source of huge emissions worldwide, 
and so obviously, to be credible, we need to address power 
plants, and by doing so, we can help other countries understand 
that it can be done. I would assume you agree with that 
statement?
    Ms. McCabe. I do agree, and by moving forward with our 
power companies, we can be on the forefront of technologies and 
the types of methodologies that we can then help other 
countries with which will benefit our manufacturers and our 
innovators here at home.
    Mr. Engel. So let me ask you, you have talked about it, but 
I want to give you again you know, a chance to enhance your 
statement. When those who oppose action say that this rule 
won't solve the problem so why should we bother, why should we 
bother?
    Ms. McCabe. It is an extremely important step to help solve 
the global problem for the United States to move forward with 
real meaningful reductions in carbon.
    Mr. Engel. So I would just like to say, and I assume you 
agree, and tell me if you do, no single action to reduce carbon 
pollution will ever stop climate change but we will never 
address this problem without many individual actions, so these 
actions do add up to a meaningful difference.
    Ms. McCabe. That is absolutely correct.
    Mr. Engel. OK. Thank you.
    Thank you, Mr. Chairman.
    Mr. Griffith. The gentleman yields back. Thank you.
    And now recognize the gentleman from Pennsylvania, Mr. 
Pitts, for 5 minutes.
    Mr. Pitts. Thank you, Mr. Chairman.
    Madam Administrator, many coal-fired power plants have 
spent millions of dollars to comply with the EPA's final 
Mercury and Air Toxics rule MATS. Despite the retrofits, many 
of these plants would operate significantly less or potentially 
retire under EPA's proposed rule which contemplates greater 
utilization of natural gas. My question is, how does the 
proposed rule prevent the problem of stranded assets?
    In other words, for coal plants that have made millions of 
dollars of investments to be compliant with MATS, but may not 
be able to meet the requirements of this rule, there are plants 
in my State that have spent hundreds of millions or even 
billions of dollars to comply with the Mercury and Air Toxics 
rule. Do generators and their customers and their investors 
just have to eat these costs?
    Ms. McCabe. It is a good question, Congressman, and 
hopefully I can give you a couple of answers to it. So, one way 
in which we anticipated avoiding this kind of situation is 
providing a very lengthy trajectory for compliance. So, going 
all the way out into 2030, that gives utilities the time to do 
two things. One is to plan carefully so that the plants in 
which they have made significant investments, they can get all 
the value out of those investments and also to plan to make 
sure that their fleet is being managed over time.
    The other thing is that where the coal-fired fleet in this 
country is aging, as I am sure you know right now half of the 
plants are in their 40s, I think, and 10 percent or so are 60 
years old or older, so, so there is a transition going on in 
the industry already, quite apart from MATS and quite apart 
from this rule.
    And the flexibility that this rule provides will allow 
States to focus on and utilities to focus on investing in the 
plants that have a long life ahead of them and make the most 
sense in order to continue to be key parts of the portfolio and 
perhaps not to invest in the oldest plants, the ones where it 
doesn't make as much sense economically to put investments into 
them. So that is how this rule helps avoid those kinds of 
situations, which we agree is a very important thing to do.
    Mr. Pitts. In your calculations in developing the rule, did 
you take into account the loss of jobs as a result? Did you 
quantify these as to the impact by State?
    Ms. McCabe. Well, again, as I said before, since the States 
will ultimately decide exactly what their plans are, all we 
could do was to do some illustrative examples, and in our 
regulatory impact assessment, we did look at the potential job 
losses and job gains associated with the rule. That is all laid 
out there.
    Mr. Pitts. Now, under the proposed rule for existing power 
plants, EPA is requiring of each State develop a State 
implementation plan and to submit it to EPA for approval. What 
if a State chooses not to participate? Would EPA impose a 
Federal implementation plan in that regard?
    Ms. McCabe. The Clean Air Act does provide that if a State 
doesn't submit a plan, that EPA would do one. I will tell you 
right now that we are not focused on that right now. We are 
focused on making sure that States understand the opportunity 
is here for them, and we are confident that States will want to 
be in the lead on this program.
    Mr. Pitts. Well, we saw that many States didn't want to 
establish their own programs to implement Obamacare and trying 
to implement that at the State level. If EPA were to impose a 
Federal implementation plan in their State, what does EPA 
envision that plans would look like?
    Ms. McCabe. We really haven't thought that through, and any 
proposed Federal plan, we would go through a public process to 
get people's views on that.
    Mr. Pitts. Would you take over energy planning for the 
States and decision making like about their electricity mix, 
would you take over planning that electric rates for consumers?
    Ms. McCabe. No, Congressman. Our job is to look at the 
emitting facilities, the coal-fired power plants, and look at 
ways to reduce the emissions from those power plants, and any 
proposed plan would be squarely within our authority.
    Mr. Pitts. All right. Combined heat and power facilities 
are already inherently efficient. What has EPA done to prevent 
those facilities from being swept into the 111(d) rule? Will 
you take measures to ensure that those facilities are not 
adversely impacted by this proposal?
    Ms. McCabe. Actually, combining power is a very efficient 
way of generating electricity, so those kinds of facilities 
will be very helpful to States in putting their plans together.
    Mr. Pitts. My time is expired. Thank you, Mr. Chairman.
    Mr. Griffith. The gentleman's yielded back.
    We now recognize the gentleman from Illinois, Mr. 
Kinzinger, for 5 minutes.
    Mr. Kinzinger. Thank you, Mr. Chairman, and thank you for 
being here on a long day, and thanks for your service.
    The EPA has recognized in the past, and I believe they have 
tried to recognize in this current rule that retaining nuclear 
power generation is a cost effective means in reducing carbon, 
and I appreciate that. As we, unfortunately, witnessed in 
Wisconsin, 8 years of carbon emission reductions brought about 
by the construction of renewable energy were wiped out with the 
closure of a single small nuclear reactor.
    I believe it is important to talk about this, given the 
fact that nuclear is the only base load power supply that runs 
around the clock without producing carbon. Understanding the 
current outlook on the nuclear industry, I have some concerns 
with the direction our regulatory agencies have been taking in 
regards to allowing them to operate and would like to ask you a 
few questions on the EPA's outlook for nuclear power going 
forward.
    In past models of climate change compiled by your agency, 
major questions surrounding the degree to which nuclear power 
is technically, politically, and socially feasible have been 
raised. Does the EPA still consider the use to be a major area 
of uncertainty?
    Ms. McCabe. I don't know that I can speak to that, 
Congressman. We do recognize that nuclear power is an important 
aspect of clean generation, and as I said before, we have tried 
to signal in a proposal and encouragement towards retaining 
existing, and we know that new is being planned and built, and 
that squarely will be advantageous to a plant, but we recognize 
that there are existing challenges beyond our control for the 
industry.
    Mr. Kinzinger. And I understand the proposed rule relies on 
an EIA study that shows 6 percent of the nuclear fleet being at 
risk, but they are still expected to continue their operations 
going forward. In addition to this, economic modeling of 
climate legislation by EPA, EIA, and others has consistently 
shown that dramatic growth in nuclear energy is necessary to 
reduce carbon emissions and that constrained development of 
nuclear energy dramatically increases the cost of compliance.
    What will happen if the EPA's assumption that these plants 
currently at risk will continue to operate with that assumption 
is incorrect, what will happen?
    Ms. McCabe. Well, it depends on what a State would choose 
to do to replace the nuclear generation, so we hope and expect 
that there would be opportunities for States to go with lower 
or other zero emitting generation renewables and also rely 
significantly----
    Mr. Kinzinger. Make a ton of windmills or something, right?
    Ms. McCabe. There is a lot of wind power being built in the 
country, significantly a growth area, and energy sufficient----
    Mr. Kinzinger. Takes a lot of wind, though, to replace a 
nuclear power plant.
    Ms. McCabe. It does.
    Mr. Kinzinger. Does the EPA have the legal authority to 
compel those plants to continue their operations?
    Ms. McCabe. Not that I am aware of.
    Mr. Kinzinger. Do you know, does any agency currently have 
that authority?
    Ms. McCabe. I couldn't speak to that, Congressman.
    Mr. Kinzinger. OK. And so a recent modeling done by EPA 
determined that 44 new reactors would be necessary to satisfy 
performance standards based on the Lieberman and Warner bill 
from 2008, and another showed that an additional 96 gigawatts 
of new nuclear power capacity would be needed by 2030 to meet 
standards set out in another proposed piece of legislation from 
2009.
    Does the EPA believe we can make meaningful reductions in 
carbon dioxide emissions from baseload power generation while 
still ensuring reliable and affordable power without 
substantial growth in nuclear power generation?
    Ms. McCabe. Well, I do, and I will note that the--that our 
proposal here is not legislation like you have described. It 
takes a very different approach, which is what is reasonable to 
expect the existing fossil plant to do and for States to do to 
reduce the carbon intensity, and it takes every State where it 
is. So if we see nuclear coming on the ground, we consider it. 
We are not counting it. We are not assuming other nuclear 
construction that is not already contemplated.
    Mr. Kinzinger. Do you know how many new--under the proposed 
rule, do you know how many new nuclear reactors would be needed 
to meet those standards?
    Ms. McCabe. Well, I think we are aware of maybe 5 that are 
under construction now, and so we took account of those, and we 
didn't take account of others that aren't yet built.
    Mr. Kinzinger. OK. And currently there is eight licenses 
under review by the NRC right now. I just want to reiterate 
that 100 percent of nuclear power generation is carbon free, 
and not only will every plant be necessary to ensure compliance 
with any future mandates but many more will need to be brought 
on to ensure affordable and reliable energy is available 
throughout the country. And I think that the key is we want to 
talk about affordable and reliability, we need a lot of nuclear 
power plants to come online.
    I thank you for your time and your patience today, and I 
yield back.
    Mr. Griffith. All right. In closing, let me note that the 
committee has outstanding document requests relating to our 
investigation of EPA's adherence to the Energy Policy Act of 
2005 and its rulemaking for new plants. It has been 4 months 
since we initiated these requests, but the EPA has been 
decidedly slow in its document production. Can you tell me who 
at the EPA ultimately is accountable to the committee for 
responding to its requests?
    Ms. McCabe. The agency will respond, and we are working on 
them. We have responded to various requests, and responses are 
under way.
    Mr. Griffith. All right. And will you commit on behalf of 
the Administrator that the EPA will produce outstanding 
documents and fully comply with our requests?
    Ms. McCabe. I won't make a commitment on behalf of the 
Administrator, but we will certainly do what we need to do to 
be responsive.
    Mr. Griffith. Will you commit to have your staff work with 
our staff to ensure the committee has what it determines is 
necessary to fulfill its oversight obligations?
    Ms. McCabe. Our staffs work very well together, and again, 
we will do what we need to do in order to be responsive.
    Mr. Griffith. Thank you. We will have questions for the 
record forthcoming. I would ask that you provide your response 
in a timely fashion, particularly given this rule appears to be 
on a very fast track with the administration. Will you commit 
to providing us responses to these questions within 60 days?
    Ms. McCabe. Right now I can't commit to a timeframe because 
I don't know how many questions there will be or what will be 
involved, but we will do our best to be as expeditious as 
possible.
    Mr. Griffith. All right. With that, I want to thank you for 
being here today and for the testimony that you have given us 
and the members for their devotion to this hearing, and that 
will conclude our hearing.

    [Whereupon at 12:23 p.m., the subcommittee was adjourned.]
    
    [Material submitted for inclusion in the record follows:]
    
    [GRAPHIC] [TIFF OMITTED] 

                                [all]