EPA regs could cost Wisconsin 20,000 manufacturing jobs

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Wis­con­sin is poised to lose more than 20,000 man­u­fac­tur­ing jobs by 2023 because of the Oba­ma administration’s pro­posed reg­u­la­tions on cut­ting car­bon emis­sions that crit­ics say will have min­i­mal envi­ron­men­tal effects.

The 4.19 per­cent reduc­tion in man­u­fac­tur­ing jobs puts Wis­con­sin at the fifth high­est drop in the coun­try, accord­ing to a study released this week by the Her­itage Foun­da­tion, a con­ser­v­a­tive-lean­ing think tank based in Wash­ing­ton, D.C.

The only oth­er states that would expe­ri­ence a high­er per­cent­age of job loss­es are New Hamp­shire, Ida­ho, South Dako­ta and Nebraska.

Nation­wide, the pro­posed U.S. Envi­ron­men­tal Pro­tec­tion Agency guide­lines cham­pi­oned by Pres­i­dent Barack Oba­ma would elim­i­nate more than 1 mil­lion jobs, with close to half com­ing from the man­u­fac­tur­ing indus­try, the report says.

The sug­gest­ed rules would also decrease the gross domes­tic prod­uct by $2.5 tril­lion over 15 years, accord­ing to the study.

This is going to have a tremen­dous­ly dev­as­tat­ing effect on the econ­o­my, and for no envi­ron­men­tal ben­e­fits,” Her­itage Foun­da­tion fel­low Nick Loris, who co-authored the report, told Wis­con­sin Reporter.

The Clean Pow­er Plan, pro­posed by the EPA last year as part of Obama’s cen­ter­piece strat­e­gy on cli­mate change, calls for a 30 per­cent cut in car­bon diox­ide and oth­er green­house gas emis­sions by 2030. The pro­pos­al estab­lish­es dif­fer­ent tar­get emis­sion rates for each state due to region­al vari­a­tions in gen­er­al mix and elec­tric­i­ty consumption.

But some have argued the restric­tions will have lit­tle, if any, influ­ence on glob­al tem­per­a­tures or cli­mate.

Eric Bott, direc­tor of envi­ron­men­tal and ener­gy pol­i­cy for Wis­con­sin Man­u­fac­tur­ers and Com­merce, said the man­u­fac­tur­ing sec­tor is only respon­si­ble for rough­ly 4 per­cent of glob­al man­made green­house gas­es. A 30 per­cent reduc­tion would equate to approx­i­mate­ly 555 mil­lion met­ric tons in 2030 or just 1.3 per­cent of pro­ject­ed emis­sions in that year.

These reg­u­la­tions aren’t about reduc­ing haz­ardous, tox­ic pol­lu­tants,” Loris said. “It’s all about cli­mate change emis­sions and the real­i­ty is, whether you believe cli­mate change is a cat­a­stroph­ic prob­lem or not, these reg­u­la­tions won’t do any­thing to mit­i­gate glob­al tem­per­a­tures, and the cost will be significant.”

Wis­con­sin and its lead­ing man­u­fac­tur­ing indus­tries would be among those hard­est hit.

More than 458,000 Wis­con­sin work­ers have man­u­fac­tur­ing jobs, which amounts to 16 per­cent of the state’s total employ­ment, or twice the nation­al aver­age, accord­ing to data com­piled by Todd Stu­art, exec­u­tive direc­tor of the Wis­con­sin Indus­tri­al Ener­gy Group.

But 20,421 of those jobs would be elim­i­nat­ed by 2023 due to the Clean Pow­er Plan, accord­ing to the Her­itage Foun­da­tion study.heritage-map

Wis­con­sin Pub­lic Ser­vice Com­mis­sion­er Ellen Nowak esti­mates the added costs to res­i­dents and busi­ness­es will be in the range of $3 bil­lion to $13 bil­lion. That total for the entire coun­try would be $284 bil­lion in 2020, accord­ing to a Novem­ber study by Ener­gy Ven­tures Analysis.

The same report also states the aver­age Wis­con­sin house­hold would see an annu­al util­i­ty bill increase of $485 by 2020, a 28 per­cent hike. The aver­age nation­al increase would be $680 a year.

These reg­u­la­tions, in essence, act like a huge tax on, not just Amer­i­can fam­i­lies and busi­ness­es, but obvi­ous­ly the ener­gy-inten­sive ones,” Loris told Wis­con­sin Reporter.

Some man­u­fac­tur­ing com­pa­nies in the state have sev­en-fig­ure ener­gy bills every month and would have a tough time sur­viv­ing a large increase, Bott said.

Loris believes some busi­ness­es would be able to “swal­low the high­er costs,” but that like­ly would lead to less invest­ments in new equip­ment and infra­struc­ture, lay­offs and high­er prices for consumers.

A big part of the prob­lem with these reg­u­la­tions is that fam­i­lies aren’t just hit when their ener­gy bill comes in the mail,” Loris said. “They are hit again and again through all the goods and ser­vices we pay for because ener­gy is in just about every­thing we make and cre­ate. It will have a tremen­dous rip­ple effect through the economy.”

Bott also has con­cerns over the por­tion of the Clean Pow­er Plan that allows states to have dif­fer­ent emis­sion rate guide­lines. He says that pro­vi­sion is pun­ish­ing states that have already been work­ing on reduc­ing green­house gas emis­sions by giv­ing them stricter requirements.

That could force some firms to move out of Wis­con­sin, Bott said.

There’s a real inequity in terms of com­pli­ance costs cre­at­ed between states and that opens the door­way for large com­pa­nies that oper­ate in local states to ship pro­duc­tion in order to avoid those huge cost increas­es,” Bott told Wis­con­sin Reporter.

The EPA has delayed final­iz­ing the Clean Pow­er Plan until this sum­mer, a move some say was made to stave off legal challenges.

Wis­con­sin Gov. Scott Walk­er said in his State of the State Address in Jan­u­ary he plans to work with Attor­ney Gen­er­al Brad Schimel to pre­pare a law­suit against the fed­er­al gov­ern­ment over the car­bon emis­sion regulations.

Bott also indi­cat­ed it’s like­ly Wis­con­sin Man­u­fac­tur­ers and Com­merce will engage in lit­i­ga­tion on the pro­posed rules.