Op-Ed: The Interstate Power Compact

Editor’s Note: This Op-Ed was written and submitted to Breitbart Texas by the Honorable Doug Domenech, director of the Fueling Freedom Project at the Texas Public Policy Foundation.

Most people are unaware of the unconstitutional expansion of federal authority to take control of electric generation in this country.

States and the Congress are starting to recognize this grave threat to electric reliability, safety, and cost. They are holding hearings and passing bills. More than half of the states have filed legislation to push back against the Environmental Protection Agency’s (EPA) Clean Power Plan (CPP). However, the states now have new tool to respond: The Interstate Power Compact.

Interstate Compacts are powerful Constitutional mechanisms that permit states to work together to maintain their sovereignty by allowing them to act collectively outside the confines of federal legislation or regulation.

The Constitution establishes the authority for compacts in Article 1, Section 10, and more than 200 have been enacted. Examples of compacts include states agreeing to build an interstate transit system and ensuring educational opportunities for military children across all 50 states.

Interstate compacts are also highly effective in resisting and shielding against federal overreach. The Interstate Power Compact would protect states’ systems of electric generation from the unconstitutional expansion of federal power.

Last year, the Environmental Protection Act (EPA) issued proposed guidelines, known as the Clean Power Plan (CPP), directing all states to limit carbon dioxide emissions from power generation, purportedly in accordance with Section 111(d) of the federal Clean Air Act. In spite of the costly new rule, EPA identifies no impact on the global climate as a result. The proposed rule infringes on states’ police powers and violates federal law granting states the authority to regulate intrastate activities regarding electricity markets.

The impact of the CPP has widespread significance. The proposed Section 111(d) carbon rule will dramatically reduce the efficient operation of state and regional electricity markets, reduce the reliability of the markets, and greatly increase the cost of electricity to consumers.

If the EPA is allowed to proceed with the unconstitutional Clean Power Plan, it won’t be long before Americans feel the ruinously expensive changes to our system of electric generation.

Under the CPP, NERA Economic Consulting estimates that U.S. electricity prices will increase by an average of 12 to 17 percent. The Heritage Foundation estimates a loss of $2.5 trillion in GDP and more than 1 million lost jobs from this flawed plan.

The effects of the CPP will be significant to every business and family. The poor, who are most unable to absorb the added costs, will feel acutely the effects of increased electricity prices. Polls conducted by the National Black Chamber of Commerce and the Texas Public Policy Foundation reveal widespread opposition to any federal plan that raises the cost of electricity, as the CPP would surely do.

EPA uses a strategy of “divide and conquer.” It puts states that are strenuously opposed to the proposed rule in a “prisoner’s dilemma” whereby each state fears the consequences of “going it alone” against the EPA.

The consequences threatened by the EPA are the shutdown of a significant portion of the state’s electrical capacity. Over half of Texas’ coal fired plants will be forced to close under the plan.

The Interstate Power Compact provides a way for states to break out of this stranglehold by working together to resist the rule. If EPA confronts a large group of resisting states, it will be much more difficult for EPA to use its strategy of “divide and conquer.”

One of the nation’s preeminent Constitutional scholars, Dr. Laurence Tribe at Harvard Law School, has denounced the rule calling it a “lawless EPA proposal.” States need to rise up against the egregious federal overreach.

Thanks to the Interstate Power Compact, states will now have the tools necessary to push back against this egregious federal abuse of power. 

The Honorable Doug Domenech is director of the Fueling Freedom Project at the Texas Public Policy Foundation. Domenech most recently served as secretary of natural resources for the Commonwealth of Virginia and served as deputy chief of staff at the U.S. Department of the Interior.