Clean Power Plan Released

John At a press conference earlier today, President Obama and Environmental Protection Agency (EPA) Administrator Gina McCarthy released the agency’s final Clean Power Plan, unquestionably the most consequential and far reaching environmental regulation of this administration.

We’ve written extensively in this space about the many concerns with the proposed version of the Clean Power Plan – the staggering costs, the potential impacts on grid reliability, and the fundamental change in the relationship between the federal and state governments as it pertains to regulating local electricity sales and distribution, just to name a few. Although EPA did make a few modest tweaks to the proposed version (ostensibly in response to comments submitted to the agency) early analysis suggests that many of the chief concerns with the proposed rule remain.

There are some interesting changes from the proposed rule to the final version worth mentioning.

• The proposed rule called for a 30 percent reduction in CO₂ emissions from fossil fuel-fired power plants from 2005 levels by 2030. The final rule calls for a 32 percent reduction by 2030.

• Despite this relatively modest increase in emissions reduction level, the dollar value of the purported benefits of the final rule is significantly lower than that of the proposed version. The benefits are now pegged somewhere between $34 billion and $54 billion annually, down from between $55 billion and $93 billion.

• Although state implementation plans (SIPs) will still be due to EPA in 2016, states can request extensions of two years. States are, however, rewarded for early investments in renewables and efficiency programs.

• Carbon capture and sequestration (CCS) requirements for new coal-fired units remain, but at slightly lower rates. This CCS requirement will likely be just one of many angles used to challenge the legality of the rule.

• EPA will count nuclear power reactors currently under construction not as existing sources, but as new, emissions-free power. This should help Georgia, South Carolina and Tennessee where reactors are currently being constructed.

More to come.