EPA chief defends price of White House plan to cut carbon emissions

GWEN IFILL: From the night he was reelected, President Obama has made clear that cutting greenhouse gas emissions was a centerpiece of his second-term agenda.

Today, his administration unveiled its biggest effort yet to tackle the issue of climate change, one loaded with political land mines and plenty of opposition about its ultimate impact.

GINA MCCARTHY, Administrator, Environmental Protection Agency: This is not just about disappearing polar bears and melting icecaps, although I like polar bears and I know about melting icecaps. This is about protecting our health and it is about protecting our homes. This is about protecting local economies and it is about protecting jobs.

GWEN IFILL: EPA Administrator Gina McCarthy laid out the carbon-cutting plan, arguing it's good for both the environment and the economy.

The 645-page proposal requires existing coal-powered plants to reduce carbon dioxide emissions 30 percent overall by 2030 from 2005 levels. And it allows states to meet the target by shifting to wind and solar energy or creating regional anti-pollution initiatives.

GINA MCCARTHY:   This plan is all about flexibility. That's what makes it ambitious, but also achievable. That's how we keep our energy affordable and reliable.

GWEN IFILL: Some coal-producing states might be allowed extra time to meet the new standards, even until as long as 2018, well after President Obama has left office.

The president made his case Saturday in his weekly radio address, shifting the argument from science to health.

PRESIDENT BARACK OBAMA: We don't have to choose between the health of our economy and the health of our children. The old rules may say we can't protect our environment and promote economic growth at the same time, but, in America, we have always used new technology to break the old rules.

GWEN IFILL: Coal and natural gas plants are responsible for nearly 40 percent of U.S. carbon dioxide emissions. But those emissions had already dropped nearly 13 percent since 2005, due in part to increased use of natural gas and more stringent vehicle efficiency standards.

But the National Association of Manufacturers warned today the new rules will threaten American jobs and investments.

Jay Timmons is the group's president.

JAY TIMMONS, National Association of Manufacturers: So the president's unilateral action could shift production to nations like China and India. And that would likely mean a rise in global greenhouse gas emissions. A better strategy would be to promote policies that support manufacturers in the United States, because we have demonstrated a commitment, a commitment to protecting the environment.

GWEN IFILL: And in a statement, House Speaker John Boehner said: "The president's plan is nuts. There is really no more succinct way to describe it. Americans are still asking, where are the jobs? And here he is proposing rules to ship jobs overseas for years to come."

Environmental groups generally welcomed the plan, although some said it doesn't go far enough. At the same time, two West Virginia congressmen, Democrat Nick Rahall and Republican David McKinley, announced they will introduce legislation to block the EPA from ever putting the plan into effect.

EPA Administrator Gina McCarthy joins me now for the administration view.



GWEN IFILL: So what is the cost here that we're talking about? We have heard a lot of numbers and there are a lot of accusations about the cost in not only electricity bills, our bills, but also in jobs.

GINA MCCARTHY: Well, we paid special attention to both achieving some significant reductions in harmful carbon pollution and protecting public health, but we also looked at the economic implications, and it's all in the package.

We are talking about allowing creative and flexible approaches by states so they can build more renewable energy, they can look at energy efficiency strategies. On the whole, we are going to get significant reductions of both carbon pollution and other traditional pollutants that directly impact public health.

This package can deliver up to $90 billion in benefits by 2030.

GWEN IFILL: Are you suggesting that the jobs that might be lost by plants closing would be gained by the creation of other things, renewables, solar…

GINA MCCARTHY: Our analysis does show that there's going to be job growth in — throughout the United States as a result of this package.

And it also shows that states have the ability to protect their coal industry, if that's most important to them, and to shift other strategies into the market that will achieve the carbon reductions we're looking for.

GWEN IFILL: Your research also shows that electricity rates would go up 4 to 7 percent by, I think it's 2020. Is that not — the prices will increase? Is that just a short-term hit?

GINA MCCARTHY: That is a short-term hit. That is — represents about $4 to $7 on a family's budget every month.

But it is very clear that that all depends on what states want to do. And so they can look at developing efficiency programs that will reduce demand. And in fact we see that as the most cost-effective strategy for most states. So, by 2030, we are actually looking at electricity bills for families going down by 8 percent.

There is a short investment opportunity that — where bills could go up a slight amount, but that's normal fluctuations of bills we see every day. And in the end, you are going to get a cleaner, more efficient energy industry across the U.S., and that's going to benefit everybody. It's going to benefit public health. It's going to benefit the climate, and it's going to benefit jobs and local economies.

GWEN IFILL: If you let states basically do what they can do to adjust depending on how much of a carbon footprint they have, how do you hold them accountable?

GINA MCCARTHY: Well, we actually will treat this as we have any other rule under the Clean Air Act. They are going to have to submit a plan, and we're going to have to track that.

And if they are falling short, they are going to have to make it up. We have ways of working with our states. But our states in this instance, they are partners. We're giving them maximum flexibility to design a plan that works for them, for their diverse fuel system, for the direction they want to head in renewables and efficiency.

We're allowing them maximum flexibility, knowing that they're going to have to come to the table. And, hopefully, that flexibility will allow them to design a plan that's meaningful for them, both environmentally and for their economy. And we will work it through. We always do.

GWEN IFILL: Well, some of — well, and you have had some success so far. Already, you're halfway toward this goal. But a lot of states say that they have already done all the hard stuff — I mean, all the easy stuff that would allow to make these cuts, and that the hard stuff lies ahead.

GINA MCCARTHY: Well, we don't disagree that states are in different places.

And that's why, in the development of this plan, we didn't just do a national one-size-fits-all. We looked at where every state was, what the diversity of their fuel mix was, how many renewables, what their intent was with renewables, what is the opportunity for efficiency, and we designed individual state goals that we thought were reasonable.

But that's the reason for a comment period. We have a 120-day comment period. And we will expect states to comment on that. But we think it's more appropriate for us to set individual state goals that are sensitive to the state's individual circumstance and look for opportunities for reductions, which will mean in some states you can get more, and other states, they have done a lot, they get credit for that, and they don't do quite as much.

GWEN IFILL: Normally, when we have conversations about climate change, it's all about the science of climate change.


GWEN IFILL: This time, it seems to be — there seems to be a shift in emphasis. So, we're talking about health benefits and economic benefits.


GWEN IFILL: Was that done on purpose?

GINA MCCARTHY: Well, I think, normally, when we talk about science, we're talking about just the science and not the actions.

Right now, the president is interested in making sure that we all go beyond the science, listen to what it says, and put that into action. EPA's rules are all about protecting public health and protecting the environment. Climate impacts public health. And we also get reductions in direct pollutants that directly impact public health.

This is really beneficial for the health and well-being of American families.

GWEN IFILL: We know what the critics say. In fact, we're going to talk to a critic in a moment. But what about the environmentalists who say that you didn't go far enough, that you could have pushed this even more?

GINA MCCARTHY: Well, I think they want to be cognizant of the fact that this is a Clean Air Act initiative where we're looking at reducing carbon in a reasonable, practical, cost-effective way.

This is what we have done. This is a long-term strategy that is going to move us to a better place for clean energy all around and a more sustainable and effective and efficient supply. But what's most important is that we didn't go outside the boundaries of the Clean Air Act. This is not a climate strategy.

This is a significant step forward that actually shows great presidential and this country's leadership, so that we can have that international discussion that is going to get us to a global solution.

GWEN IFILL: You have been traveling the country trying to till the ground, I suppose, as this was coming down the track. What do you say to Democrats like Mary Landrieu in Louisiana, or Alison Lundergan Grimes, who is running for Senate in Kentucky, or in West Virginia? What do you say to these senators from coal states who say, you're hurting us?

GINA MCCARTHY: Well, I think we need to work through the rule.

It's complicated, but we did the best job that we could to recognize that coal is in the mix today, and it is going to be in the mix almost at the same levels in 2030. But what you're going to see in 2030 is more efficient plants. And you are going to see a lot more fuel diversity, with renewables and energy efficiency investments being made. This on the whole is great for the economy and it's great for jobs.

GWEN IFILL: You don't expect — but you don't expect Democrats from coal states to be able to — to be willing to make that case?

GINA MCCARTHY: I actually think they should look at it.

We gave every state the opportunity to say where they wanted investments to happen. Some of them will invest in their coal units. They will get them more efficient and they will stay for a long time. We see the shift in coal from about 37 percent of electricity being generated by coal today to 30 percent to 31 percent in 2030.

That is not a large shift, and you will have facilities that know where they stand in a carbon-constrained world.

GWEN IFILL: Pardon me for the interruption. Do you worry that the Supreme Court or Congress could shut you down on this?

GINA MCCARTHY: Oh, the Supreme Court has spoken on this issue a number of times and told us it's perfectly appropriate — in fact, our responsibility — to look at carbon as a potential pollutant in the Clean Air Act.

We did the endangerment finding. It's done. It's been asked, it's been asked, it's been answered, it's been answered. So, we're pretty safe in that regard.

And Congress will — has every ability to look at the issue of climate itself and speak to this issue. But I'm staying in my lane. This is an act that Congress passed, that gave to EPA, and gave us both the responsibility and the authority to address pollution that endangers public health. Carbon pollution is that.

GWEN IFILL: EPA Administrator Gina McCarthy, thank you for joining us.

GINA MCCARTHY: Thank you very much.