Utilities are eager to learn more – and environmentalists don’t like what they already know – about sweeping changes in federal regs to boost America’s steadily declining coal sector.
Trump’s Clean Power Plan
The Environmental Protection Agency’s “Affordable Clean Energy” proposal would replace the Obama-era Clean Power Plan’s sweeping changes in the U.S. electricity mix with more modest emissions curbs at individual power plants. It would:
- Set pollution guidelines based on assumptions about what improvements could be eked out through efficiency upgrades at the power plants.
- Give states the latitude to design their own plans for paring carbon dioxide emissions at the sites.
- Reduce carbon dioxide emissions as much as 1.5 percent from projected levels without the Obama plan in place, as per EPA estimates.
Tens of billions of capital construction dollars may be at stake for utilities, which have retired or announced plans to retire 630 coal-fired facilities in 43 states — nearly 40 percent of the U.S. coal fleet.
Environmentalists worry that global warming will be hastened by the new energy policies announced Tuesday.
President Donald Trump’s administration on Tuesday unveiled its plan to dramatically weaken carbon dioxide limits on coal-fired power plants by shifting most of the regulatory burden to states in a further assault on the Obama climate legacy.
The Environmental Protection Agency’s “Affordable Clean Energy” proposal would replace the Obama-era Clean Power Plan’s sweeping changes in the U.S. electricity mix with more modest emissions curbs at individual power plants.
The Edison Electric Institute, which represents investor-owned utilities, said greenhouse gas emissions by coal-fired generation plans have fallen 27 percent in a decade.
“At this time, we are still reviewing and analyzing the details of EPA’s proposed rule to replace the Clean Power Plan, and look forward to working with EPA, states, and other stakeholders throughout this rulemaking process,” Brian Reil, EEI spokesman, said.
Rhea Suh, president of the Natural Resources Defense Council, said, “The world’s on fire and the Trump administration wants to make it worse.”
“What America needs instead is an even stronger Clean Power Plan, one that will further accelerate the nation’s shift to clean energy—that’s how to truly protect public health, our children and future generations, she said.”
The Bipartisan Policy Center, which strives to come up with policies that have bipartisan appeal, said there are limits to what the states can do to combat climate change without federal guidance.
Jordan LaPier, BPC spokesman, said, “without a federal emissions-reduction requirement, it’s unclear whether states have sufficient backstops in place to keep that momentum going.”
AEP, a multi-state utility, sees a slow, inexorable move to cleaner energy. It has been one of the largest generators of electricity from coal.
“AEP’s business strategy is focused on modernizing the power grid, expanding renewable energy resources and delivering cost-effective, reliable energy to its customers,” the utility said. “That strategy will not change. AEP already has cut its CO2 emissions by more than 57 percent from 2000 emission levels, and the company has established a clean energy strategy with a goal to achieve an 80 percent reduction in carbon dioxide levels from its fleet of power plants by 2050.”
Meanwhile, EPA Acting Administrator Andrew Wheeler said the proposal “would restore the rule of law and empower states to reduce greenhouse gas emissions” while providing “modern, reliable, and affordable energy for all Americans.”
“Today’s proposal provides the states and regulated community the certainty they need to continue environmental progress while fulfilling President Trump’s goal of energy dominance,” Wheeler said in a news release.
The EPA estimates its proposal could pare carbon dioxide emissions as much as 1.5 percent from projected levels without the Obama plan in place.
The move represents the latest bid by Trump to fulfill campaign promises to revive the coal industry and restore mining jobs. Although it is unlikely to dramatically alter the U.S. power mix — or give a big boost to domestic coal demand, which has flagged amid competition from cheap natural gas and renewables — industry advocates hailed the effort as curbing federal government overreach and leveling the playing field.
“The policy put forward by the previous administration was an illegal attempt to impose a political agenda on the country’s power system,” Hal Quinn, president of the National Mining Association said in an emailed statement. “The replacement rule respects the infrastructure and economic realities that are unique to each state, allowing for state-driven solutions, as intended by the Clean Air Act, rather than top down mandates.”
“Without a federal emissions-reduction requirement, it’s unclear whether states have sufficient backstops in place to keep that momentum going,” said Jordan LaPier, of the Bipartisan Policy Center.
Environmental advocates and the architects of former President Barack Obama’s ambitious plan derided the Trump administration’s proposed replacement as political pandering and said it represented a U.S. retreat from the global fight against climate change. The move dovetails with a separate administration proposal to relax Obama-era greenhouse gas emission limits on vehicles and coming efforts to ease restrictions on the amount of methane that can escape from oil wells.
The Trump proposal may open a small window for a revival of coal even as it prolongs uncertainty over the U.S. electricity mix and casts doubt on investments by utilities making decades-long choices about new plants and upgrades.
Administration officials are on track to finalize the new regulation next year, following a 60-day public comment period on Tuesday’s proposal, but critics have already vowed to battle the effort in federal court and the legal disputes could take years to resolve. As it stands, Obama’s Clean Power Plan never went into effect; amid legal challenges from opponents who said it overstepped the EPA’s authority under federal law, the U.S. Supreme Court put the initiative on hold in February 2016.
Critics are already vowing to fight Trump’s replacement.
“If the Trump administration’s proposal to dismantle the Clean Power Plan is adopted, we will work with our state and local partners to file suit to block it, in order to protect New Yorkers, and all Americans, from the increasingly devastating impacts of climate change,” said New York Attorney General Barbara Underwood.
According to the EPA, once the plan is fully implemented, power sector emissions could fall 33 to 34 percent below 2005 levels — roughly mirroring the same target as Obama’s initiative, which sought to cut those greenhouse gas emissions 32 percent relative to 2005.
Trump’s EPA says its replacement would be cheaper too, costing some $400 million less each year than Obama’s carbon dioxide curbs. The agency also forecasts a modest, potentially 0.5 percent reduction in retail electricity prices.
But there would be immediate costs to the environment and public health too. The EPA predicts its changes would mean an uptick in particulate matter pollution — and the asthma attacks, respiratory diseases and premature deaths tied to it. There could be 470 to 1,400 additional premature deaths in 2030 under the most ambitious proposed power plant efficiency improvements, EPA predicted. Hospital admissions and emergency room visits for asthma would also climb.
Under the Trump plan, the EPA would establish broad guidelines on the technologies that can be used to pare carbon dioxide emissions and then give states three years to develop their own plans for paring that pollution.
It might not be enough to dramatically alter the landscape for U.S. coal, which is losing U.S. customers as utilities increasingly turn to natural gas and renewable power to generate electricity. Although the Trump administration forecasts a 4.5 percent to 5.8 percent increase in the production of coal for generating electricity under its proposal, analysts say the shift is unlikely to reverse a spate of already announced closures of coal-fired power plants.
The proposal might have the most impact in the Midwest and Southeast, where aging coal power plants continue to be profitable for utilities, and state regulations are less likely to punish emissions, Konolige said.
The Trump administration proposal was cheered by business leaders and conservatives who said the Obama initiative illegally sought to compel more renewable power and quash coal. The proposed replacement rightly restores regulatory power to states, they said.
“Today’s announcement is an important step toward a more collaborative process that fits within EPA’s statutory authority and will result in achievable progress through more practical, state-driven programs,” said Karen Harbert, president and CEO of the U.S. Chamber of Commerce’s Global Energy Institute. “This revised approach will help continue the trend of lower electric power sector emissions while preserving America’s energy edge and respecting environmental law.”
Jim Matheson, head of the National Rural Electric Cooperative Association, said the Trump proposal is more workable. “The Clean Power Plan would have resulted in stranded assets and stranded debt, significantly increasing electricity costs for many consumers,” Matheson said by email.
— Some of the reporting in this article is from Bloomberg.