AIMED AT OBAMA ADMIN., NRDC PLAN SEEKS TO CUT EMISSIONS FROM EXISTING SOURCES

Tamar Hallerman
GHG Monitor
12/7/12

The Natural Resources Defense Council released a proposal this week aimed at compelling the Obama Administration to reel in carbon emissions from existing power plants under Clean Air Act authority. Based on modeling from the consulting group ICF International, the environmental NGO says its plan—which calls on the Environmental Protection Agency to work with individual states to set up carbon emissions reduction rates based on the current fuel mix of each—would reduce carbon emissions from the country’s power plants 26 percent by the end of the decade and 34 percent by 2025. “The President put climate change on the national agenda, and NRDC’s plan shows how the United States can make big reductions in carbon pollution that drive climate change, with a flexible approach that promotes clean energy investments and delivers big benefits for Americans’ health,” NRDC Executive Director Peter Lehner said in a statement.

Under a settlement agreement between EPA, NRDC and others, the Obama Administration proposed greenhouse gas emissions performance standards for new fossil fuel-fired power plants last spring. By setting an emissions cap of 1,000 pounds of CO2 per MWh of electricity, the rulemaking essentially requires power generators to switch to natural gas or install carbon capture and storage technology. The rulemaking has angered many Congressional Republicans and coal industry groups, which argue that the Administration is picking technology winners and losers and unfairly disadvantaging coal. While the Obama Administration is expected to finalize that proposal soon, it has yet to introduce widely-expected guidelines for existing sources. Earlier this year, EPA Administrator Lisa Jackson said the Agency has “no plans” to place emissions limits on existing sources—required under the same settlement agreement as the new sources—and environmental community has since made the issue one of its top goals for Obama’s second term in office.

EPA Would Look at Each State’s Energy Mix

In a press conference this week in Washington, NRDC officials said the plan does not require states or power generators to use any specific technology to reduce emissions, but allows them the flexibility to choose their own suite of technologies to comply with the rulemaking. Under the plan, EPA would use data about each state’s fuel mix, as well as national average emissions rate benchmarks, to hammer out individual standards for each particular state. From there, states would then be able to develop their own implementation plan regarding how they will meet those benchmarks through the energy technologies of their choice. States could also opt to participate in alternative schemes such as state and regional cap-and-trade programs as long as they ultimately achieve the same level of carbon reductions, NRDC said. As with other Clean Air Act rulemakings, if a state does not provide EPA with an acceptable proposal, the Agency could issue its own federal plan for the state, according to the NGO.

NRDC said that the plan would unleash billions in clean energy investments and help save the economy more than $25 billion in climate and public health costs. “We are overturning the conventional wisdom that reducing carbon pollution through the Clean Air Act would be ineffective and expensive,” the report’s main author Dan Lashof, NRDC’s director of Climate and Clean Air programs, said in a statement.  “We show that the EPA can work with states and power companies to make large pollution reductions, by setting system-wide standards, rather than smokestack-by-smokestack ones, and by giving power companies and states the freedom to choose the most cost-saving means of compliance.”

Plan Would Cost Industry $4 Billion in 2020

NRDC said the proposal, which carries a price tag of about $4 billion in 2020, would lead to $25 billion to $60 billion in environmental and public health benefits while prompting the investment of more than $90 billion in efficiency efforts and renewable sources by the end of the decade. Whether the plan has any legs, though, remains uncertain. The proposal offers the Obama Administration the distinct advantage of being able to effectively bypass Congress regarding the regulation of greenhouse gases, but the move would also likely prompt additional outrage from Republicans as well as a slew of lawsuits, as other EPA Clean Air Act rulemakings have in recent years. Opponents in the past have described EPA’s regulation of CO2 under the Clean Air Act as government overreach.

But environmental groups argue the fight is worth it. The nation’s power plants are the source of 40 percent of the country’s carbon pollution, NRDC said, spewing about 2.4 billion tons of CO2 into the atmosphere annually. While the country’s electricity generation fleet has seen a monumental shift from coal to natural gas in recent years, the reforms would provide the nation with one of its best chances of cleaning up emissions in one shot, the group said. “This recommended proposal can deliver the health and environmental benefits of reducing emissions from power plants without interfering with reliable and affordable electricity supplies. Establishing such CO2 emission standards now will boost investments in energy efficiency and will give the power industry the investment certainty it needs to avoid billions of dollars of stranded investment in obsolete power plants,” according to the report.