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Energy and Environment Monitor

Trump’s EPA Proposes to Roll Back Clean Power Plan

October 11, 2017

By: Robert G. McLusky

The Obama EPA finalized two rules in 2015 that comprised the Clean Power Plan (“CPP”). One established CO2 emission standards for new, modified and reconstructed power plans under Section 111(b) of the Clean Air Act.  The second, and far more controversial, established CO2 emission “guidelines” under CAA §111(d) to be used by states in regulating existing power plants.    As we have noted before, the rule created COs budgets for states that could not be met by existing power plants using any affordable technology.  Instead, the rule depended on widespread “trading” by which states could meet their budgets only if coal-fired units were not run and power was generated by a combustion of gas and renewable sources.  The rule was notable for its interpretation of the “sources” to which it applied. 

Section 111(d) requires EPA to issue emission guidelines to regulate sources of pollutants that reflect the “best system of emissions reduction” (taking costs into account). Historically, EPA has imposed a system of emissions reduction by treating each individual source of pollutants separately and considering how their emissions might reasonably be controlled.  Not so with the CPP.  Instead, because electric power sources are linked by the power grid, EPA elected to treat the entire grid as a single source of pollution.  And, by doing so, it declared that the best system of reductions included not using many of the existing coal-fired units at all and replacing their production with gas-fired or renewable units.  Almost immediately, a coalition of coal-producing and coal-burning states and industry sued EPA.  Ultimately, the Supreme Court stayed the effect of the rule pending their challenge.   Enter the Trump administration.

On April 4, 2017, EPA announced in the Federal Register that it was reviewing the CPP, as well as its prior legal memorandum justifying the expansive system of emissions reduction. 82 FR 16329 (April 4, 2017).  Then, on October 10, 2017, EPA announced that it would repeal the 2015 rule for existing power plants.   The announcement included an acknowledgement that the 2015 rule departed from EPA’s prior practice of developing measures that can be applied to individual pollution sources.  It also includes a statement that the Obama EPA’s interpretation “exceeds the bounds of the statute.”  EPA’s proposal to rescind the rule may be found here

The rescission of the CPP will not be final until EPA finalizes the newly-proposed rule, and there will surely be challenges to the proposal. And, even if the rescission rule is finalized, EPA will be obligated to issue a new rule unless it also finds a way to avoid regulating COs emissions from new sources altogether.

This article was authored by Robert G. McLusky, Jackson Kelly PLLC.

 

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