Steel Industry Group Tells EPA that Power Plant Proposal Could Increase Electricity Costs for Steelmakers

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For Immediate Release
December 1, 2014

Contact: Lisa Harrison
202.452.7115 / lharrison@steel.org

WASHINGTON, D.C. – The Environmental Protection Agency’s (EPA) proposed power plan could raise electricity costs, damage competitiveness and hurt American steel jobs, says the American Iron and Steel Institute (AISI), the trade association representing three-quarters of steel capacity in North America. 

In formal comments to the EPA today, as part of the agency’s rulemaking process, AISI president and CEO Thomas J. Gibson said, “the EPA’s plan to further regulate electricity from power plants may lead to higher costs of electricity to large industrial customers like steel, while potentially lessening the quality and reliability of the electric supply that is essential for our industry to operate and succeed. In addition, the plan could put steel producers in the U.S. at a disadvantage against competitors in other nations that generally have higher rates of greenhouse gas emissions, and some of which benefit from subsidized energy costs. Such a result would not only be detrimental to the domestic steel industry and its employees, but to the larger global environment.”

Gibson said that in its proposal, EPA indicates that their plan would cause nationwide electricity prices to increase between six and seven percent. He said this electricity economic impact will be exacerbated for the steel industry due to the regional differences in current fuel mix and the cost to switch to other fuels for the generation of electricity.

“EPA’s plan will have a disproportionate impact on coal-fired utilities, many of which are concentrated in areas where steel is produced. Industrial customers, especially steel producers, will be charged to offset the cost of replacing coal capacity with other sources including the cost of new transmission infrastructure. Coupled with the global competitiveness challenges this plan presents, implementation of this plan would hit the steel industry hard,” Gibson concluded.

AISI also this week joined a group of 16 business associations in signing similar comments on the plan’s impact on manufacturing jobs. A full text of AISI’s comments to EPA are here.

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AISI serves as the voice of the North American steel industry in the public policy arena and advances the case for steel in the marketplace as the preferred material of choice. AISI also plays a lead role in the development and application of new steels and steelmaking technology. AISI is comprised of 20 member companies, including integrated and electric furnace steelmakers, and approximately 125 associate members who are suppliers to or customers of the steel industry. AISI's member companies represent over three quarters of both U.S. and North American steel capacity. For more news about steel and its applications, view AISI's website at www.steel.org. Follow AISI on Facebook or Twitter (@AISISteel).