Not everyone has the time or inclination to read the EPA’s 645-page proposed rule to reduce CO2 emissions rates from existing power plants, so we thought it would be useful to present answers to frequently asked questions about the rule. The following FAQ’s are distilled from EPA fact sheets, newspaper articles, and numerous webinars, white papers, and analyses that have appeared about the proposed rule since it was released on June 2, 2014.
Navajo Generating Station. Photo: EPA
What is the Clean Power Plan? On June 2, 2014, the U. S. Environmental Protection Agency (EPA) released a proposed rule that requires each U.S. state to reduce its CO2 emissions rate from existing fossil fuel plants to meet state-specific standards starting in 2020, with a final emissions reduction target date of 2030. EPA estimates that the rule will achieve a 30% reduction in CO2 emissions from the U.S. electric power sector in 2030 relative to 2005 levels. This interactive map from EPA shows CO2 emissions reduction targets by state.
What authority does EPA have to do this?
- In 1970 the Clean Air Act was enacted by President Nixon to address growing national concern over air pollution. The Clean Air Act gave EPA the responsibility for setting emission standards for certain air pollutants.
- In 2007 the U.S. Supreme Court ruled in Massachusetts v. EPA that greenhouse gases are air pollutants, so they must be regulated by EPA if they threaten or endanger public health.
- In 2009 an EPA endangerment finding declared that current and projected concentrations of six key greenhouse gases— including CO2—threaten the public health and welfare of current and future generations. With this finding, EPA’s authority to regulate greenhouse gas emissions was established.
Why all the different names: 111(d), Clean Power Plan, carbon rule?
These are all terms for the same thing.
- 111(d) is the section of the Clean Air Act that gives the EPA authority to regulate dangerous air pollutants not specifically included in the original Act. This has become a very important section of the Clean Air Act because it allows EPA to regulate pollutants that were not understood to be hazardous in 1970 when the Clean Air Act was passed. The term 111(d) is now used by some people to denote EPA’s proposed rule to control carbon pollution from existing power plants.
- EPA regulates air pollution by proposing and implementing “rules,” so “carbon rule” is another term used for the CO2 emission standards EPA is proposing.
- Clean Power Plan is the term EPA is using for the proposed rule.
Why power plants? How much do they contribute to CO2 emissions?
Power plants are the largest source of CO2 emissions in the United States, making up a third of our nation’s greenhouse gas emissions.
Does the rule regulate all greenhouse gases?
No. The Clean Power Plan only sets emissions reduction targets for Carbon Dioxide (CO2).
How are CO2 emissions measured in the proposed rule?
Emissions are measured as a rate: Pounds of carbon dioxide per megawatt hour of electricity generation, or lbs/Mwh
How will the Clean Power Plan affect Nevada?
EPA is proposing that Nevada develop a plan to lower its carbon pollution to meet a proposed emission rate goal of 647 lbs/Mwh in 2030.
EPA suggests “building blocks” for each state to meet its emission reduction goal. These building blocks consist of switching from coal generation to generation from either new or existing natural gas facilities; credit for new or existing nuclear power; using credit for renewable energy; and credit for energy efficiency improvements. Nevada will choose how to meet the goal through whatever combination of measures reflects its particular circumstances and policy objectives. A state does not have to put in place the same mix of strategies that EPA used to set the goal.
Nevada may work alone or in cooperation with other states to comply with the proposed rule. EPA estimates that states could achieve their goals most cost effectively if they work with others.
What are Nevada’s CO2 emissions now from existing power plants? What will they be in 2030?
- In 2012, Nevada’s power sector CO2 emissions were approximately 14 million metric tons from sources covered by the rule.
- Nevada’s 2012 emission rate was 988 pounds/megawatt hours (lb/Mwh).
- EPA is proposing that Nevada develop a plan to lower its carbon pollution to meet its proposed emission rate goal of 647 lb/Mwh in 2030. This is a reduction of 35%.
Is this just something EPA is imposing, or does the state have a say?
Under the Clean Power Plan, EPA sets a carbon emission reduction target for each state, then the states have flexibility in designing a plan to meet those targets. The ways states can meet their targets are broad and varied, and could include energy efficiency programs, switching from coal to cleaner-burning natural gas, expanding renewables like wind, geothermal and solar, and even joining together with other states in regional “cap-and-trade” markets. Only if states do not come up with a state plan to meet the emission reduction targets will EPA impose standards on them.
In the proposed rule, the emission reductions targets for each state are different. How did EPA determine what reduction target to assign to each state?
In determining the state-by-state reduction targets, EPA considered a wide range of potential measures to reduce CO2 emissions from existing power plants, and came up with a “Best System of Emissions Reduction” (BSER) that includes coal heat rate improvements, switching from coal generation to combined-cycle natural gas, increased deployment of renewable energy and nuclear power, and increased energy efficiency. EPA then used these four “building blocks” in a formula to calculate the emission reduction that each state could achieve. Since the existing mix of electricity generation and the capacity to switch to different fuel sources is different in each state, the reduction targets vary by state.
Though EPA relied upon these four “building blocks,” in calculating state-by-state emissions reduction targets, states have broad flexibility to use other strategies in implementing their own emissions reduction plans.
How do emission reduction requirements for Nevada compare with those for other states?
- Nevada’s emission reduction target is 647 lbs/Mwh. This is a 35% reduction from 2012 levels.
- The national average reduction target is 987 lbs/Mwh. This is a 25% reduction.
- As a comparison, South Carolina is being asked to lower its emissions rate by 51%; Wyoming is being asked to lower its emissions rate by only 19%.
This interactive map from EPA shows CO2 emissions reduction targets by state.
Is it possible for Nevada to achieve the required reduction without “freezing in the dark?” CO2 emissions from electrical generation in Nevada have already dropped significantly over the past decade, as Nevada utilities switched from coal to cleaner-burning natural gas and to renewables. In the ten years from 2002 to 2012, CO2 emissions from electrical generation in Nevada dropped from about 21 million to 14.9 million metric tons annually.
The switch away from coal in Nevada will continue, EPA rule or not. SB123, passed in the last Nevada legislative session, mandated that NV Energy close the Reid Gardner coal-fired power plant in southern Nevada and withdraw from its share of the Navajo coal plant in Arizona, replacing the coal capacity with natural gas and renewables.
With state and NV Energy initiatives including the implementation of SB123; a state Renewable Portfolio Standard mandating 25% renewable energy by 2025; the ongoing switch from coal made possible by the historically low price of natural gas as well as the plummeting costs of renewable energy; and building on energy efficiency efforts already underway, Nevada is in a good position to meet the emissions reduction target with minimal impact on ratepayers.
How much will it cost?
EPA projects that the nationwide compliance costs for this rule would be between $7.3 billion and $8.8 billion annually by 2030. This would lead to about a 3 percent increase in electricity rates by 2030.
The New York Times reports that while “Opponents attacked Mr. Obama’s plan in vociferous terms, with the claim about Americans ‘freezing in the dark’…more optimistic assessments of the plan came from utility executives and many state officers who would have to carry it out. Some independent energy experts said that electricity prices may rise by a few percentage points in some states, but even that is not a foregone conclusion. ‘I predict this will be far easier and far faster and far cheaper than most people realize,’ said Hal Harvey, chief executive of Energy Innovation…”
A study by the U.S. Chamber of Commerce puts the cost much higher, but according to an article in The New Republic, “The Chamber’s study included all kinds of shaky assumptions and its prediction of higher electricity prices was not actually that big. As Jonathan Chait observed in New York magazine, ‘Even the Chamber’s unrealistically dire number is still low enough that most people would barely notice it.’”
What are the benefits?
EPA says the Clean Power Plan will lead to climate and health benefits worth an estimated $55 billion to $93 billion in 2030, including avoiding 2,700 to 6,600 premature deaths and 140,000 to 150,000 asthma attacks in children.
What does the proposed rule say about nuclear power?
Nevada has no nuclear power plants, but in some states, nuclear power may play a role in achieving the state’s emission reduction goal. In the rule, the EPA acknowledges the role of “clean” nuclear power in achieving the state goals. The EPA assumes states will be “completing all nuclear units currently under construction, [and] avoiding retirement of about six percent of existing nuclear capacity” The EPA says that the challenge of nuclear waste disposal, contamination risks, and other environmental impacts associated with nuclear power are outweighed by its clean energy benefits.
What does the proposed rule say about energy efficiency as a way to meet emissions reduction goals?
The EPA proposes a “portfolio approach” to meeting a state’s emissions reduction goals. The portfolio could include energy efficiency measures implemented either by electrical generators or by other entities.
What difference will the proposed rule make in halting global warming?
According to the EPA, the Clean Power Plan will result in:
- By 2030, a 30% reduction in CO2 emissions from U.S. power plants from 2005 levels
- 30 million metric tons less carbon pollution
Unfortunately, this is not enough. According to the New York Times, “Climate scientists say that emissions in the developed countries need to fall 80 percent or more by 2050 if global warming is to be held to tolerable levels. Mr. Obama’s draft plan does not put the United States on a trajectory that would make such a huge cut likely to be achieved.”
But expected regulations reducing methane emissions from landfills and pipelines will also help the US reduce greenhouse gas emissions to the levels pledged by President Obama in 2009. Moreover, the Clean Power Plan sends a very strong message to the rest of the world that the US is serious about cleaning up carbon pollution. So it’s a start. And in the continued lack of congressional action on climate change, it’s much better than nothing.
What’s the timeline?
- June 2, 2014: draft rule released
- Comment period open until October 16, 2014
- Rule finalized 2015 S
- tates will have until June 2016 to submit initial state implementation plans
- State plans finalized by June 2017 for stand-alone plans, and by June 2018 for multi-state plans
- Emission reduction target date is 2030
How can I comment to the EPA about the Clean Power Plan?
Use this link to see a public meeting schedule or to comment (by October 16, 2014): This link takes you to EPA’s webpage about the Clean Power Plan where there are also many fact sheets, as well as the full 625-page rule and technical supporting documents.