## MississippiManufacturersAssociation July 30, 2014

The Honorable Gina McCarthy Administrator U.S. Environmental Protection Agency Ariel Rios Building 1200 Pennsylvania Avenue, NW Washington, DC 20460

Dear Administrator McCarthy:

The Mississippi Manufacturers Association (MMA) represents over 2,000 manufacturing companies and affiliated businesses in the State of Mississippi. Among its members are a numberofthe significant generators and consumers ofelectric powerwithin the state. All ofour members are concerned that EPA's proposed rule, which would institute a new regulatory framework on Mississippi and otherstates thatwould transform howelectricity is generated, distributed, transmitted and used, could eliminate the critical competitive advantage that affordable and reliable electricity provides to theAmerican economy. Although MMAwill continue to review EPA's proposal and to submit additional comments ifpermitted, it is already clearto us thatthe proposal will be disruptiveto and is fundamentally incompatible with numerous practical and technical aspects ofthe electricitysystem in Mississippi and all otherstates. It is evidentthatthe proposal is based on aflawed interpretation ofthe Clean AirAct. We therefore urge EPA to withdrawthe current proposal and substantially revise this rule. In the meantime, we wantto highlight five high-level issues thatare representative ofour more detailed objections to EPA's proposal.

1. Electricity price increases and economic impacts. While EPA's proposal must be thoroughly and independently analyzed to better understand its costs and electricity market implications, it is clearthatthe rule presents asignificantthreatto American jobs and the economy. EPA itselfestimates that its rule will increase electricity prices between 6 and 7 percent nationally in 2020, and up to 12 percent in some locations. These increases will place a heavy burden on businesses in Mississippi and across the U.S. for which affordable energy provides acritical operatingadvantage in competitive global markets. This is particularlytrue for MMA memberswho are energy-intensive and trade-exposed industries.

2. Rule Structure and Scope. EPA is pursuing a regulatory standard on one industrysource (fossil-fuel power plants) based on potential actionstaken well beyond the source's physical location and controlling authority, and in many cases by entitiesthatare not directlysubject to regulation underSection 111 ofthe Clean AirAct. This structure raises significant legal and practical questions regarding the viability ofthe rule. EPA has to date failed to answer such questions, and has provided little to no information regarding whatauthority it is relying upon to institute such an expansive regime, and how it intends to proceed if it does not approve ofindividual state implementation plans. This is critical information that EPA should disclose in the interest of maximizing transparency and continued cooperation with states and stakeholders.

3. Technological achievability. As noted above, EPA has asserted that each ofthe individual targets assigned to states under EPA's proposed regulations are based on "reasonably achievable ratherthan maximum

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4. Follow-on Regulations. EPA's proposed regulation for power plants is onlythe first step ofthe Administration's broader greenhouse gas regulatory agenda. As the agency has committed to a numberof follow-on rules, MMA members will be impacted twice-both as electricity customers and also as industries "next in line" for subsequent rules that EPA has committed to pursuing. For example, last month EPA proposed new rules restricting emissions from municipal landfills, and the agency's current budget request to Congress notes itwill soon begin considering new greenhouse gas (GHG) regulations on thefollowing sectors: refineries, pulp and paper, iron and steel production, livestock operations, and cement manufacturing. The substance, process, and ultimate outcome ofthe initial proposed regulations on power plants are certain to influencethe regulations thatwill be subsequently proposed.

5. Process and timeline. As stated earlier, states and stakeholders continue to struggle to interpretand react tothe rule's more than 1,600 pages of highly technical materials. Despite this ongoing confusion, and despite EPA's repeated emphasis on responding to stakeholder concerns and ensuring a robust and transparent public deliberation process, the agency has scheduled public hearings in onlyfour locations, and has provided few if any opportunitiesfor stakeholders and other interested parties to publicly ask the agency direct questions regarding the design and potential impacts ofits rule. Our concerns with these limited opportunitiesforopen and interactive communication with the agency are compounded by what appears to be a rushed regulatory implementation timeline. A regulation as complex and far-reaching as the one proposed must prioritize a robust, inclusive rulemaking process over meeting arbitraryand rushed deadlines.

MMA recognize thataddressing each ofthese significant issues will require substantial time and effortofthe EPA, states, and stakeholders alike. However, as afirst step, we respectfully askthat EPAtake two critical actions to enhance the public involvement process associated withthis rule:

1. We request that EPA hold additional public hearings on the rule in orderto enable agreater numberof citizens and stakeholders representing a broader range ofviewpoints and geographic locationsto provide input on the rule. Further, and perhaps most important, we ask thatat least some component ofthese public meetings be interactive, so impacted stakeholders can ask EPA direct questions regarding the intent and implications of its proposed rule. Such aformat will help bring clarity to an immensely complicated regulatory proposal, and greatly enhance the public-private and federal-state cooperation thatyou have emphasized are essential to the success ofthe rule.

2. We request that EPA extend the currently-planned 120-day comment period by at least 60 days to ensure thataffected stakeholders have sufficienttimeto assess the rule and consider feedback provided at theforthcoming public hearings.

We appreciate the opportunityto provide these comments and stand ready towork cooperativelyto ensure EPA's proposed regulation addresses these critical issues. Sincerely,

Jay 

### C. Moon, CEcD, FM, HLM President and CEO