EPA Announces Proposed Standards for Greenhouse Gas Emissions for New Power Plants

Today the EPA announced proposed standards to limit greenhouse gas emissions from new power plants. The move was hailed by environmental groups and it is expected to largely impact the construction of new coal-fired power plants by essentially requiring their emissions output to mirror those of efficient natural gas units - either through capture or storage of CO2 emissions. Industry advocates opposed the new rule because of cost impacts to states heavily reliant on coal for electricity production and that the Administration is essentially mandating new technology which is not yet commercially feasible. 

According to a fact sheet developed by the EPA, "This common‐sense step under the Clean Air Act would, for the first time, set national limits on the amount of carbon pollution power plants, built in the future, can emit. EPA’s proposed standard reflects the ongoing trend in the power sector to build cleaner plants that take advantage of American‐made technologies." The agency's new rule would not apply to power plants currently in operation or those that begin construction over the next 12 months and would apply only to future fossil-fuel power plants that are 25 megawatts or larger in size. In addition, the rules would not apply to proposed power plants in Hawaii or US Territories, biomass projects, or units that are part of a Federal demonstration project. New projects would require new fossil-fuel plants to meet an output‐based standard of 1,000 pounds of CO2 per megawatt‐hour, a standard that nearly 95% of most natural gas units can meet. EPA's rationale for issuing the proposal "reflects the ongoing trend in the power sector to build cleaner plants that take advantage of American-made technologies, including new, clean-burning, efficient natural gas generation, which is already the technology of choice for new and planned power plants."

Congressional opponents, including Senator Jim Inhofe, have strongly opposed the new proposed rule and announced intentions to use the Congressional Review Act - which requires 30 cosponsors - to thwart the standard from going forward. Inhofe was quoted in a Greenwire article saying the Congressional Review Act will allow Senators, ""the opportunity to decide whether they will stand with President Obama and his destructive war on affordable energy, or their constituents back home, who will suffer the most from hundreds of thousands of lost jobs and the skyrocketing electricity and gas prices this agenda will impose on them." Industry critics contend that the rule runs counter to the President's "all of the above" energy strategy by effectively making new coal-fired power plants impossible to produce as Carbon Capture and Sequestration technologies are not yet commercially viable on an industry-wide basis. The CEO of the National Mining Association said in a release, ""Requiring coal-based power plants to meet an emissions standard based on natural gas technology is a policy overtly calculated to destroy a significant portion of America’s electricity supply. This is a movie we have seen before, and the script remains unchanged. Volatile natural gas prices will, once again, expose millions of households to higher utility bills, threaten hundreds of thousands of workers with unemployment and weaken both the competitiveness of basic industries and the reliability of the nation’s electricity grid."