26 Jun 2013, 6.47 pm GMT

Washington, 26 June (Argus) — Steelmakers, coal miners and utilities criticised President Barack Obama’s proposal to impose greenhouse gas (GHG) regulations on existing US coal-fired power plants within two years as the keystone to a broader effort to reduce emissions.

The critics say the proposed measures would put US industry at a disadvantage to foreign competitors and increase domestic electricity costs.

Obama’s proposals “will invariably raise electricity costs and decrease service quality for major industrial customers, like the steel industry,” said Thomas Gibson, chief executive of the American Iron and Steel Institute (AISI). “Policies, like those proposed by the president, raise energy costs on domestic companies and threaten our ability to remain competitive in the international manufacturing environment.”

“The administration’s plan makes coal-fired electricity supply less affordable and less reliable to major industrial customers, such as steel producers — which will threaten the loss of valuable manufacturing jobs in the United States,” Gibson said. AISI’s members account for 75pc of North American steelmaking capacity.

Obama yesterday directed the Environmental Protection Agency (EPA) to propose regulations by June 2014, with final rules due a year later, to lower US emissions by 17pc by 2020 from 2005 levels. States would be required to submit implementation plans to EPA by 30 June 2016. The plan sidesteps Congress, which failed to pass GHG gas cap-and-trade legislation three years ago and is now split between a Republican-dominated House and a Democratic-controlled Senate.

Obama’s order did not say how the EPA should regulate existing generating plants but directed the EPA, together with states and industry, to develop approaches “that allow the use of market-based instruments, performance standards and other regulatory flexibilities.”

Obama also set a 20 September deadline for EPA to issue a new proposal on standards for new power plants.

Peabody Energy criticised Obama’s push to cut coal-fired power generation, saying any such move would “harm Americans, who would feel the same pain at the plug that we all feel at the pump.”

Peabody said the US is “seeing a sharp rise in coal-fuelled generation in 2013 as the most economic choice, with natural gas prices doubling from 2012 lows.”

However, Peabody welcomed Obama’s proposals to boost higher-efficiency power generation and expand research in carbon capture, use and storage technologies, and to further clean coal technologies.

Consol Energy said the announcement “simply does not align with our economic or national security interests. “ Consol said it was “not aware of any credible assessment showing unilateral action or fuel switching in the US will materially change the global atmospheric concentrations of carbon dioxide.”

The Obama plan “advocates policies that induce more expensive energy which will choke off economic activity, impair our global competitiveness and ship manufacturing and other jobs overseas with no material change in global CO2 concentrations,” Consol said

Southern Co., a major utility, said it would review the GHG proposals and provide input during the process, but said that Congress was “best equipped to develop a natural energy policy that meets the needs of all sectors.”

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