By Paul Ploumis (ScrapMonster Author)

October 28, 2015 06:15:52 AM

SPOKANE (Scrap Monster): The newly introduced regulations by the US Environmental Protection Agency (EPA) may lead to drastic increase in electricity costs, noted the American Iron and Steel Institute (AISI).

The steel body along with 15 other business organizations has filed a court challenge on the newly introduced power plant regulations. As per EPA, the electricity generating utilities are required to implement necessary measures to reduce carbon dioxide emissions by as much as 32% over the next fifteen years.

According to Thomas J. Gibson, President and CEO, AISI, the country’s top steel producing states depend heavily on coal for electricity generation. The new EPA regulations will put the affordability of electricity for steel producers in these states at risk. This in turn will affect the economic growth of steel producing states and hit badly on revenues of steel sector industries.

AISI forecasts price rise for electricity to range between 6% and 7%. The regulations are feared to put US steel producers at disadvantage against competitors. The Institute noted that other steel producing countries maintain higher greenhouse gas emission rates and enjoy subsidy benefits on energy costs. The rise in production cost would impact the county’s steel industry and thousands of workers who rely on the industry.

In its court filing, the trade associations argue that the new rule exceeds the established bounds of EPA’s authority under the Clean Air Act (CAA). It also warns about creation of new bureaucracies in connection with permitting, construction, and funding of power resources and shutting of existing plants which fail to meet the criteria.

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 19 member companies, including integrated and electric furnace steelmakers, and approximately 125 associate members who are suppliers to or customers of the steel industry.