10 Myths Behind Submitting a State Implementation Plan (SIP)

Now that the so-called “Clean Power Plan” is finalized, the EPA is pressuring states to develop implementation plans (SIP). States should not submit implementation plans. Attorneys left and right believe EPA’s carbon regulations are likely illegal. Therefore, before saddling their residents with higher electricity costs and consigning their states to a federal energy takeover, states should wait for the courts to decide the legality of this regulation before filing implementation plans.

The Supreme Court’s decision about EPA’s Mercury and Air Toxics rule shows what happens when states comply with a regulation before courts have had their say. The Supreme Court found flaws with the regulation but more than 40 gigawatts of power generation, (enough to power the homes of over 30 million people) had already closed to comply with the regulation. States do not lose any options by waiting for the courts, but there are huge costs to developing plans prematurely.

Below, we shed light on some of the myths EPA supporters have offered about state plans:

Myth #1: Filing a SIP protects states’ rights.

Fact: Filing a SIP locks the state into complying with the SIP.

Rushing to file a SIP leaves states with less control over their energy future. If EPA’s regulation is overturned, costly actions taken to comply with the SIP cannot easily be reversed. Moreover, the history of the Obama Administration shows that submitting a SIP is not the end of the story. On 52 occasions, the Administration has rejected state plans, said they aren’t good enough, and turned them into federal plans. The previous three Administrations did this only 7 times.

Myth #2: The choice is a state plan or non-compliance.

Fact: This is a false choice—the real choice is whether to implement a legally dubious rule before the courts have a chance to decide its legality.

States have at least three options: 1. File a SIP. 2. Wait for EPA to impose a Federal Implementation Plan (FIP). 3. Wait for EPA to impose a FIP, but then file a SIP later if the courts uphold the rule. The Clean Air Act grants states the legal right to submit their own implementation plans or not. The governors who have stood up to fight implementation are acting well within their legal right and protecting their most vulnerable citizens from Obama’s illegal rule.

Myth #3: Filing a state plan will be a backstop if the court challenge fails or the new Administration stands by the Carbon rule.

Fact: Waiting to submit a SIP preserves options; rushing to file forecloses options.

States can submit a SIP even after EPA’s accelerated deadline and even after a federal plan has been imposed. As a matter of practice, EPA strongly prefers that states implement their own plans. It’s also worth noting that the imposition of a federal plan is a lengthy process that can involve litigation and requires participation from several interested parties. 

Myth #4: State plans can be tailored to a state’s needs.

Fact: States must pick from a limited menu—and all the options are bad.

All states need affordable, reliable electricity. EPA’s regulation is designed to increase the cost of generating electricity. It relies on building massive amounts of new wind and solar electricity generation, sources that are at least three times as expensive as existing average coal generation. This means the plan will unavoidably drive up the cost of electricity—regardless of the need for affordable electricity. 

Furthermore, the plan limits state’s options. There is a reason Laurence Tribe charged the EPA proposal with “treating [states] like marionettes dancing to the tune of a federal puppeteer.” The ultimate objective (and result) of the carbon rule is the same under a state plan or a federal plan: Take affordable energy off the table and create a national energy policy dictated by Washington bureaucrats.

Myth #5: Submitting a state plan is the best way to protect state residents.

Fact: As designed, the rule will make prices rise under any state or federal plan—the only chance to avoid this fate is to resist implementation.

President Obama’s promise that electricity prices would “necessarily skyrocket” did not refer just to a federal plan. Under a state plan, states will see dramatic increases in energy costs and lose control over their ability to use the most affordable energy sources. The illusion of state control will not save states from higher energy costs. 

Myth #6: Submitting a state plan preserves future options for a state.

Fact: Submitting a state plan closes doors and gives EPA the keys.  

As we witnessed with the MATS rule, submitting a SIP before its legality is determined virtually guarantees the regulation will be implemented. It puts states on an irreversible course that undercuts the lawsuit and discounts the value of waiting for the next Administration, which could withdraw or stay the rule.

Myth #7: Submitting a state plan does not undermine legal challenges.

Fact: The regulation is illegal, but that doesn’t matter if states begin implementing before the courts decide its fate.

As many experts point out, the rule is illegal under both the Clean Air Act and Constitution. EPA has no basis calling on states to implement this illegal rule and no authority to impose a federal plan. For this reason, the most prudent stance for states to take is to not submit a SIP until legal resolution.

Myth #8: State plans are an economic opportunity for a state.

Fact: Shutting down the most affordable and dependable energy options will have devastating consequences.

The rule will unambiguously raise electricity rates. Replacing our reliable, affordable generation with politically preferable—and more expensive—energy sources will leave consumers and low-income communities with less disposable income to pay for basic necessities like housing and health care.

Myth #9: Governors and their agencies have sole authority over this decision.

Fact: The regulation requires a fundamental restructuring of the power grid, which cannot be done without new legislative input.

The carbon rule requires state regulators to do more than they currently have authority to do. This means, in most cases, new statutory authority will be needed from state legislatures to submit a SIP. Emphasizing this point, the final rule relies heavily on emission reductions from renewable energy sources, yet refuses to grant credit to states for these “emission reductions” if they are not codified (read: mandated) by state law. State legislatures should protect their constituents from higher energy prices by rejecting attempts to expand regulators’ statutory authority.

Myth #10: Submitting a plan is the responsible thing to do.

Fact: There is nothing responsible about rushing to implement a legally dubious regulation that will burden your state residents with job losses and higher energy bills.

Prudence dictates a wait-and-see approach. State leaders have a duty to protect their constituents from federal overreach. At this point, refusing to submit a state plan is the only way to retain state control and ensure continued access to affordable, abundant, and reliable energy.

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