News of the new rule by the EPA for coal power plants came and went over the past few weeks because of the debt ceiling battle. However, the the rules mandated by the EPA based upon environmental legislation passed by Congress will have a serious impact on homeowners and businesses across the country. The Chicago Tribune wrote about new EPA regulations a couple of weeks ago. They are designed to impact 27 states. According to this Star Tribune story, the “27 states subject to the rule are: Alabama, Arkansas, Florida, Georgia, Illinois, Indiana, Iowa, Kansas, Kentucky, Louisiana, Maryland, Michigan, Minnesota, Mississippi, Missouri, Nebraska, New Jersey, New York, North Carolina, Ohio, Pennsylvania, South Carolina, Tennessee, Texas, Virginia, West Virginia and Wisconsin.”
Wright-Hennepin is a co-op that supplies power to thousands of customers west of the Minneapolis western suburbs. In Wright-Hennepin’s July newsletter, CEO Mark Vogt discusses the ramifications in excellent detail (see pages 2-3 of newsletter). One of the more incredible items he notes is that the Denver, CO office of the EPA stepped in to oversee the MPC which is a coal fired power plant in Bismarck. They took away the authority of the State of North Dakota which according to Vogt’s newsletter article, is against the law. They are requiring a $500 million investment in Selective Catalytic Reduction (SCR) which is also known as “clean coal” technology. (For the geeks who want to read the technical details from the EPA on this new technology, enjoy reading the Clean Coal White Paper on Selective Reduction Technology). The EPA’s Fact Sheet on the new ruling is also available. I used to live in North Dakota. Their skies are quite clear up there…and they are also clear and beautiful here in Minnesota as well.
The quote I love the best is from EPA Administrator, Lisa Jackson, who is quoted in the Wright-Hennepin July newsletter as claiming:
The new standards for power plant emissions will prevent an estimated 17,000 premature deaths, 120,000 cases of childhood asthma and 850,000 days of missed work due to illness.
Does anyone else have a hard time believing these data points?
This new policy will hurt consumers and businesses by increasing prices we pay for electricity. There will also likely be rolling power outages or brownouts. This will also lead to lobbyist calling for new investment in alternative energy because of the high cost of coal based electricity.
If you have electric baseboard heat in your home, you might want to give some serious thought to figuring out how to change that out in the next year.
So how does this relate to housing? I live and work in the western suburbs of Minneapolis. We have thousands and large suburban houses that were built in the last 30-40 years. Many of these are 3,000 – 5,000 square feet. Given the continued increase in property taxes, the costs to maintain your home, and the rapidly rising utility costs, I believe people are going to opt for smaller houses. (The guys who sell the new homes might disagree and perhaps rightly so, but they are selling more energy efficient homes but there will still be a sticker shock once these utility prices hit).
So those who have been thinking your home is based upon a certain price per square foot and that if you have 5,000 square feet it must be worth a lot more than a 3,000 or 4,000 square foot house, you may need to think twice about that. We are seeing signs right now, without the utility price jacking, that the big, older houses are very difficult to sell. Yes, for now it’s likely that they are just overpriced and outdated. However, in the future, buyers will change their minds on what they will buy. By the time these price hikes hit in 2014, it’s going to be much more difficult to sell your big 5,000 square foot 10-30 year suburban house.
Good luck to us all. If you have any comments or thoughts on this, I’d love to hear them!
- The House Must Stop the EPA – Tom Borelli – Townhall Conservative (gds44.wordpress.com)
- New EPA standards for coal plant emissions already working to clear our skies (texasvox.org)
- Daily Benefactor News – Obama’s EPA Finalizes Latest Job-Killing Policies For 26 States; Will Cost Taxpayers $1.6 Billion A Year & Thousands Of Jobs (thedaleygator.wordpress.com)