EPA Proposes New Carbon Pollution Standards

On May 11, 2023, the EPA announced proposed new carbon pollution standards for coal and natural gas-fired power plants that will protect public health, reduce harmful pollutants, and deliver up to $85 billion in climate and public health benefits over the next two decades.

“The proposal for coal and new natural gas power plants would avoid up to 617 million metric tons of total carbon dioxide (CO₂) through 2042, which is equivalent to reducing the annual emissions of 137 million passenger vehicles, roughly half the cars in the United States,” an Agency news release says. “Through 2042, EPA estimates the net climate and health benefits of the standards on new gas and existing coal-fired power plants are up to $85 billion.”

According to the EPA, the power sector is the largest stationary source of greenhouse gases (GHGs), emitting 25 percent of overall domestic emissions in 2021. Most of these emissions result from the combustion of fossil fuels in the electric generating units (EGUs).

The EPA Fact Sheet on the proposed rule includes the following overview information:

• The proposals would set limits for new gas-fired combustion turbines; existing coal-, oil-, and gas-fired steam generating units; and certain existing gas-fired combustion turbines. Consistent with the EPA’s traditional approach to establishing pollution standards for power plants under Section 111 of the Clean Air Act (CAA), the proposed standards are based on technologies such as carbon capture and sequestration/storage (CCS), low-GHG hydrogen co-firing, and natural gas co-firing, which can be applied directly to power plants that use fossil fuels to generate electricity.
• As laid out in Section 111, the proposed New Source Performance Standards (NSPS) and emissions guidelines reflect the application of the best system of emissions reduction (BSER) that, taking into account costs, energy requirements, and other statutory factors, is adequately demonstrated for the purpose of improving the emissions performance of the covered EGUs.
• According to the EPA evaluations, the emissions reductions, benefits, and costs of the proposals to limit CO₂ from the existing coal fleet and new natural gas units will cut 617 million metric tons of CO₂ through 2042 along with tens of thousands of tons of particulate matter (PM) 2.5, sulfur dioxide (SO₂), and nitrogen oxide (NOx)—harmful air pollutants that are known to endanger public health.
  • Between 2024 and 2042, projected net climate and health benefits from these emissions reductions range from $64 billion to $85 billion—an annual net benefit that ranges from $5.4 billion to $5.9 billion.
  • These estimates don’t include the impact of the proposed requirements for existing gas-fired combustion turbines or the third phase of the NSPS. The EPA performed a separate analysis of these proposed requirements that estimates they would reduce between 214 million and 407 million metric tons of CO₂ cumulatively through 2042.
• The proposals provide utilities with options for meeting these standards, as well as the time needed to plan for and invest in compliance and continue to support a reliable supply of affordable electricity.
• The more frequently and longer a unit operates and the greater its capacity, the more cost-effective it is to install controls for CO₂ emissions.  These proposals considered this fact to create subcategories in the standards and guidelines. For some subcategories, the proposals phase in technology standards over time, recognizing the time needed to plan for and install controls.
• The EPA is also simultaneously proposing to repeal the Affordable Clean Energy (ACE) rule.

The technology-based standards the EPA is proposing include:

• Strengthening the current NSPS for newly built fossil fuel-fired stationary combustion turbines (generally natural gas-fired);
• Establishing emissions guidelines for states to follow in limiting carbon pollution from existing fossil fuel-fired steam generating EGUs (including coal-, oil-, and natural gas-fired units); and
• Establishing emissions guidelines for large, frequently used existing fossil fuel-fired stationary combustion turbines (generally natural gas-fired).

For 2030 alone, the proposed standards are predicted to prevent:

• Approximately 1,300 premature deaths
• More than 800 hospital and emergency room visits
• More than 300,000 cases of asthma attacks
• 38,000 school absence days
• 66,000 lost workdays

Background

Because power plants are the second largest contributor to GHG emissions, they have remained a top target for emissions reductions.

Authority to set power plant GHG emissions limits was initially provided by the Obama administration’s Clean Power Plan (CPP) to establish “flexible and achievable standards to reduce carbon dioxide emissions” that included “carbon pollution reduction goals for power plants and [enabled] states to develop tailored implementation plans to meet those goals. …”

“Soon after, 18 of the 50 US [states] joined a legal challenge against the emissions limits,” reports Power Technology. “Led by West Virginia politicians, the legal case said that the Plan gave the EPA massive power to reshape the U.S. economy. Opposers often say that state governments should decide emissions limits, not federal agencies.”

The U.S. Supreme Court (SCOTUS) enacted a stay on the CPP in 2016.

Then, on June 30, 2022, in a 6–3 decision in West Virginia v. EPA, SCOTUS ruled “that the [CAA] does not give the [EPA] broad authority to regulate greenhouse gas emissions from power plants that contribute to global warming,” according to the Associated Press (AP).

The Biden administration has long promised new GHG emissions regulations for power plants but took ample time to craft the proposed regulations in preparation for scrutiny from SCOTUS, which has a conservative majority.

One big difference in the proposed regulations is they apply within power plants’ fenceline, unlike the Obama administration’s CPP, which attempted to regulate emissions beyond plants’ fenceline.

“The policy would not mandate any type of technology or fuel,” noted The Washington Post in an article published before the proposed regulations were issued. “But they said the limits it sets would be so stringent that to meet them, fossil-fuel-burning plants most likely would need to use carbon-capture technology or be capable of switching to use hydrogen, which burns without [GHG] emissions.”

What’s next?

The proposed regulations are already under fire from lawmakers in coal-heavy states and industry.

“Democratic Sen. Joe Manchin of West Virginia has already vowed to oppose any future EPA nominee in the Senate over the rule,” says CNN. “Meanwhile, Manchin’s Republican colleague Sen. Shelley Moore Capito of West Virginia called it an attempt to ‘kill American energy jobs’ and vowed to introduce a Congressional Review Act bill to attempt to overturn it.

“And though the EPA’s regulatory ability survived one Supreme Court challenge last year, it could face new attempts to squash it. West Virginia Attorney General Patrick Morrisey suggested the rules were headed for a court battle.”

“Based upon what we currently know about this proposal, it is not going to be upheld, and it just seems designed to scare more coal-fired power plants into retirement — the goal of the Biden administration,” Morrisey, a Republican, said in a statement. “That tactic is unacceptable, and this rule appears to utterly fly in the face of the rule of law. [SCOTUS] has placed significant limits on what the EPA can do — we plan on ensuring that those limits are upheld, and we expect that we would once again prevail in court against this out-of-control agency.”

However, many analysts believe the current administration has planned well for future legal challenges.

“I have confidence in its durability,” said Sam Ricketts, a former advisor to Washington state Governor Jay Inslee who now works with Evergreen Action and the Center for American Progress, according to CNN. “The EPA has learned the lessons. … I think they’re operating tightly in the bounds of what the [CAA] and [SCOTUS] allow.”

As expected, environmental groups say the proposed regulations don’t go far enough or move quickly enough to meet the climate change challenge.

“While this proposal is a vitally important first step, the EPA can do more, and faster,” says the Natural Resources Defense Council (NRDC). “One clear opportunity for securing greater emissions reductions is setting limits for more existing gas plants by lowering the unit size and capacity factor thresholds. And the EPA can—and should—adjust the timelines for compliance across all three categories to require emissions reductions sooner.”

Industry sources predict the power industry won’t be able to meet the proposed deadlines.

In response to the proposed regulations, Plant Services notes that the “National Association of Manufacturers (NAM) Vice President of Energy and Resources Policy Brandon Farris said, ‘With nearly 60% of our nation’s energy generated from natural gas and coal, this will either require deployment of still nascent technologies at an impractical pace or force those plants to shut down entirely.  With the many threats to global energy security, that is a grave risk to our economy and to our families. The U.S. cannot afford to shut down more than half of our power generation and grind our economy to a halt. The NAM looks forward to working with the administration to ensure emissions standards protect public health while allowing manufacturers to continue pioneering technologies to make our air even cleaner and our climate even healthier.”

Comments will be accepted on the proposed regulations on the Federal eRulemaking Portal under Docket #EPA-HQ-OAR-2023-0072 once they’re published. The EPA has also scheduled two public hearings. For more information on the proposed rules and registration for the public hearings, see the EPA Greenhouse Gas Standards and Guidelines for Fossil Fuel-Fired Power Plants website.