The Environmental Protection Agency announced Thursday (yesterday) that it was taking the unprecedented step of directly issuing air permits to Texas industries, citing the state's unwillingness to comply with greenhouse gas regulations that take effect January 2, 2011.Sounds like a face-off.
EPA officials indicated that they were taking over Clean Air Act permits for greenhouse gas emissions because "officials in Texas have made clear ... they have no intention of implementing this portion of the federal air-permitting program."
Comment: Even before the regulation goes into effect, the federal government takes a preemptive shot across the bow. The story goes on to say that the EPA plans to issue greenhouse gas permits in Arizona, Arkansas, Florida, Idaho, Kansas, Oregon and Wyoming. But those states have indicated they were revising their permitting process to comply with greenhouse gas emission regulations.
(Since North Dakota was not mentioned in the article, it sounds like North Dakota will comply with the EPA's mandate.)
Texas and the rest will have a tough fight, against the Supreme Court, which has *ordered* the EPA to regulate GHGs as part of its duty. I suspect the Supreme Court wins this one.
ReplyDeleteI agree with you. The question is whether the House / Senate get involved, and what happens under a new administration. Going forward, this is just another uncertainty for companies trying to plan whether to make new investments now or wait until after 2012. We saw much the same thing with some companies selling their assets in late 2010 (this year) concerned that the Bush tax cuts would not be extended.
ReplyDeleteI personally don't see the permitting as any big deal for investors. It just means that the moat has gotten bigger for some companies, making investments in those companies a better deal. Xcel, for example, says they meet the new requirements, and thus may be a better investment than in a company who cannot meet the requirements.
Regardless, the costs will be passed on to consumers in a regressive manner.
I have other concerns, but as an investor, not a problem.