Top WH Advisor Suggests "Meaningful" Climate Change Regulatory Action May Come Soon

At a forum organized by the magazine New Republic the Deputy Assistant to the President for Energy and Climate Change, Heather Zichal, said “We are poised to take meaningful action" to address climate change and that it was a "legacy" issue for the Administration's second term. The comments triggered considerable speculation in energy/environment industry and trade circles that the Administration would make good on a pledge made in the President's State of the Union address to take executive action on climate change policies - including a controversial proposal to potentially expand carbon dioxide restrictions beyond just new plants but for existing power plants as well.

In March 2012, the EPA announced proposed regulations to limit greenhouse gas emissions from newly constructed power plants. The scope of the agency's proposed rule would not apply to power plants currently in operation or those that began construction over the next 12 months. Further, the proposal would apply only to newly constructed 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 fossil-fuel plants would be required 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. In essence, it requires the emissions of coal-fired power plants to mirror those of efficient natural gas units by either through capturing or storing its CO2 emissions.  Critics of the rule in the electric and manufacturing industry oppose it because of potential cost impacts to states heavily reliant on coal for electricity production. They also suggest that the Administration is essentially mandating new technology (carbon capture and storage) which is not yet commercially feasible. EPA missed its statutory deadline to issue finalized rules last April and currently there is a group of coal-fired utilities called the Utility Air Regulatory Group petitioning the Supreme Court to overturn a DC Circuit Court of Appeals decision that upheld the rules proposed by the agency. 

According to media reports, Zichal said to expect action "in the coming weeks" and while she did not lay out specific regulatory action observers expect the focus will be on three areas: reducing carbon emissions from power plants, increased energy efficiency of appliances, and furthering the development of alternative energy projects on public lands. She was quoted in an article in today's Greenwire during the question and answer portion of the program hinting the Administration may be contemplating expanding the regulatory scope of the Clean Air act on greenhouse gas emissions to the existing coal fleet. In the story she said, ""We have never as a country put forward a regulation on new or existing coal plants before...And I think whether that's the president or the team at EPA, everyone is very focused on making sure that those policies are done the right way, that those policies are going to provide the right incentives going forward, the right policy to really drive emissions reductions, and I'm very confident that we'll land that policy in the right place." White House officials previously had stated that the Administration had "no plans" to expand the New Source Standard developed for new fossil fuel plants in 2012.