June 21, 2023

Scott Strand

Fighting Greenhouse Gases from Power Plants

Stronger Standards Mean Healthier Communities and a More Resilient Midwest

Power plants are now the second leading source of climate pollution in the U.S., falling behind transportation. We have made great strides, but there is still much work to be done. Reducing the threat of extreme climate change requires actions to cut the amount of greenhouse gases power plants emit. The good news is that the U.S. Environmental Protection Agency (EPA) is taking action. Setting rules for power plants, unfortunately, has a long and complicated history.

Reducing the threat of extreme climate change requires actions to cut the amount of greenhouse gases power plants emit.

Last week, the EPA completed a set of public hearings on its new proposed greenhouse gas standards for powerplants. The new proposed rules are EPA’s response to last year’s U.S. Supreme Court decision in West Virginia v. EPA, which struck down the Obama-era Clean Power Plan.

EPA’s proposal follows the traditional Clean Air Act standard-setting process. Under the relevant part of the Act, standards are set for new and existing sources of pollution, in this case new and existing power plants. These standards, which eventually translate into emission limits in permits, are set by assessing what the “best system of emissions reduction” (BSER) is, whether it has been “adequately demonstrated,” and how effective that BSER can be in reducing emissions.

Here’s some background

In the Clean Power Plan, the BSER was essentially to stop using coal and instead generate electricity through renewables and, in some limited cases, natural gas. The court thought that was too broad, that EPA did not have a clear congressional mandate to order “generation shifting.” In the Court’s mind, that would lead to results that were too “major” to be within EPA’s authority. So now, EPA is using a more limited “inside the fence line” version of BSER–carbon capture and sequestration (CCS) and/or “green” hydrogen co-firing-technologies which EPA documents are technologically available and quite effective in cutting GHG emissions.  And, because of the expanded tax credits in the Inflation Reduction Act (IRA), industry objections that the costs are too high are effectively muted.

The requirement is that those powerplants get their greenhouse gas emissions down, but the means they choose is up to them

It is important to understand (and some press accounts have not understood this) that EPA is not requiring coal or gas-fired powerplants to build CCS or green hydrogen infrastructure. The requirement is that those powerplants get their greenhouse gas emissions down to a level those technologies could deliver, but the means they choose is up to them and, to a considerable extent, the individual states who will actually administer the permits. Many utilities may choose simply to close their fossil plants, rather than make these investments, even with the available tax credits.

EPA’s proposed standards

EPA has, in my view, done a very good job of putting these new standards on a solid legal footing after West Virginia. EPA is still going to get sued, but unless the Court overrules decades of precedent baked into our legal system since the New Deal and truly revives a broad nondelegation doctrine eliminating most agency authority to adopt rules, these standards should survive judicial review.

EPA needs to be careful not to hand out a “get out of jail free” card

That does not mean the standards cannot be improved. In my testimony to EPA last week, I outlined some opportunities to strengthen the proposal in a final rule. The proposal contains broad “retirement exemptions” for coal and gas plants, which utilities claim they are going to retire and therefore should not have to invest in pollution reductions. That could be abused. Here in the Midwest, we have coal plants operating past their promised retirement dates, so EPA needs to be careful not to hand out a “get out of jail free” card based primarily on company representations. Environmental justice communities, in particular, have heard these kinds of promises before.

The standards also put the effective dates way off, some as late as 2040 for certain existing plants. The utilities may well take those long away deadlines as a license to keep coal and gas plants open longer than they otherwise would, which is the opposite of what EPA wants to accomplish. Any responsible utility has been planning for decades now for how they would make substantial carbon reductions if they were suddenly required to do so, so the idea that ten, fifteen, even nearly twenty years are needed for technological development and investment is dubious at best.

Furthermore, the proposed standards exempt over 80% of the natural gas plants, sometimes by asserting that the BSER for those plants is routine maintenance and upkeep. EPA can push harder, certainly on any new gas plants, and likely for many existing ones.

Conclusion

In sum, I commended EPA for its new powerplant standards, and I concurred that their approach should pass legal muster, but I urged them to reconsider the scope of the exemptions and the length of time for compliance. We need to take real, consequential action now.

EPA is currently taking written comments on the proposed standards, and recently extended the deadline to August 8, 2023. ELPC will continue to follow this closely and please look for an action alert soon. EPA needs to hear from you!