The Obama administration’s latest proposal to curb carbon emissions at existing power plants threatens to drive up energy costs, Murray Energy chief executive Robert Murray tells FOX Business Network’s Neil Cavuto.
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Murray and the company he founded have filed four lawsuits against the U.S. Environmental Protection Agency over regulations that target the coal industry. Four state attorneys general have joined those efforts.
Earlier this week, Murray Energy sued the EPA over a new set of rules that aim to reduce carbon-dioxide emissions by 30% from 2005 levels.
The proposed regulations raised more questions over the future of the coal industry and electricity rates. Coal, already under pressure from low natural gas prices, accounts for 40% of electricity generation in the U.S., down from 45% in 2009.
In an exclusive interview Thursday on Cavuto, Murray expressed concern over the impact the EPA’s rules will have on his company, one of the largest U.S. coal producers. Ohio-based Murray Energy also has operations in Pennsylvania, West Virginia and other states.
“It’s a human issue to me because my employees’ lives are being destroyed,” Murray said, adding that coal remains the cheapest way to generate electricity. “I grew up poor. Poverty-stricken people are going to be hurt the worst. Low-cost electricity is a staple of life.”
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Legal challenges to the Obama administration’s latest climate proposal were widely expected. Opponents say the Clean Air Act, under which the EPA wrote the rules, does not give the agency the authority to regulate carbon emissions.
“How he’s used the Clean Air Act to try to get these regulations out is totally illegal,” Murray told Cavuto. “This will be litigated for some time. But in the meantime, 411 coal-fired power plants, 100,000 megawatts of the lowest-cost electricity, are going to be shut down while it’s being litigated.”
As a result, Murray believes the new rules for power plants will harm the coal and utility industries regardless of whether legal challenges succeed. Electric rates have already gone up and will go up “a whole lot more,” he warned.
In a note sent to clients earlier this month, Goldman Sachs analysts suggested much of the compliance costs could get passed down to consumers.
“Regulated utilities are typically able to pass through the costs of complying with environmental rules to rate paying consumers,” the analysts wrote. “Some of the higher utility costs could be passed through indirectly through higher prices for other goods and services, which would increase the effect somewhat.”
Murray, who has spent 58 years working in the electric utility and coal industries, said consumers will see higher bills as utilities look to replace the electricity generated by coal with more expensive sources.
“I am scared to death for our country, as a man who grew up poor, for people on fixed incomes, for retirees, for the poverty-stricken, and for people that manufacture a product,” he added.