On June 2, 2014, EPA, under President Obama’s Climate Action Plan, released the long-awaited draft greenhouse gas (GHG) rule for existing power plants across the nation. Officially called “The Clean Power Plan,” the proposed rule establishes state-by-state 2030 GHG goals (except for Vermont, which doesn’t have any fossil-fuel-fired power plants). The three most important questions about how EPA would handle the regulation were 1) what the baseline year would be, 2) how deep the reductions would cut, and 3) what alternatives would be counted toward that reduction. In sum, the proposed regulations call for carbon emissions cuts from the power sector of 30 percent below 2005 levels by no later than 2030 and virtually all existing state programs to reduce GHG should be able to be counted toward the reductions.
The program is to be administered under EPA’s authority under Section 111 (d) of the Clean Air Act (CAA). Accordingly, EPA is not proposing emissions rate goals or guidelines for the four affected sources located in Indian country at this time, but rather has committed to working with those Tribes and sources in the future. This action is a continuation of the Obama Administration’s pledge to use executive powers under existing CAA authority to implement his Executive Branch Climate Action Plan. Combining a state-by-state approach with a broader “outside the fence line” view of GHG reductions, U.S. EPA has attempted to craft a reduction scheme which flexibly addresses the wide variety of emission profiles in the nation’s largest source of GHG emissions, its power sector, but inevitably requires reduction from coal burning power plants. The four main reduction components to the plan are:
- Reducing the carbon intensity of generation at individually affected EGUs (Existing Generation Units) through heat rate improvements. [On-site efficiency improvements]
- Reducing emissions from the most carbon-intensive affected EGUs in the amount that results from substituting generation at those EGUs with generation from less carbon-intensive affected EGUs (including Natural Gas units under construction). [Grid management]
- Reducing emissions from affected EGUs in the amount that results from substituting generation at those EGUs with expanded low- or zero-carbon generation. [Increased renewables and nuclear]
- Reducing emissions from affected EGUs in the amount that results from the use of demand-side energy efficiency that reduces the amount of generation required. [Increased energy efficiency, or reduction in electricity demand]
One of the main questions leading up to this release was, “What would the federal government do with existing state GHG programs?” Turns out they listened to the hundreds of stakeholders who commented as demonstrated by the following excerpt from the published rule.