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How Ambitious Is EPA's Climate Change Rule, Really?

How Ambitious Is EPA's Climate Change Rule, Really?

By allowing states extraordinary flexibility in meeting the new standards, the EPA chose not to set the bar very high for several coal states.

Jun 3, 2014
Coal-burning power plant

Brandishing her pen on Monday morning to sign proposed rules that would significantly cut carbon dioxide emissions from the nation's electric power plants, Environmental Protection Agency head Gina McCarthy said: "This is the opening of our second round of engagement."

What lies ahead is a 120-day comment period, months of additional fine-tuning, discussions with other government agencies and interest groups, and more likely than not attempts to challenge the rule in Congress and the courts. A final rule will be issued in about a year. The states, meanwhile, will come up with their own implementation plans, subject to Washington's review. Only when all that is over will the rules take full effect.

The proposed standards are highly flexible guidelines for states to follow in limiting the emissions from existing power plants. They are designed to achieve a 30 percent reduction in emissions by 2030, compared to the amount fossil fuel power plants emitted in the benchmark year 2005.

That would amount, in the end, to some half a billion tons less carbon dioxide allowed into the atmosphere each year from the nation's existing power plants.

"That's like canceling out annual carbon pollution from two thirds of all cars and trucks in America," declared McCarthy in a feisty and confident speech before a large, supportive crowd in Washington.

But how ambitious is this, really?

The industry has already cut its carbon emissions by more than 10 percent since 2005, thanks to slackening demand and ample supplies of affordable natural gas. And with more coal plants scheduled for closing, it may not be that difficult for it to meet the EPA's goals. By the time these rules are made final, the nation may be almost halfway to the target.

Michael Levi, senior fellow for energy and environment at the Council on Foreign Relations, called the administration's target "relatively deep" but also "relatively easy to achieve."

"Despite the usual grumbling from some critics, it's abundantly clear that these rules can be implemented cost-effectively," said Andrew Steer, president of the World Resources Institute.

Other environmental groups said they would seek stricter limits during the comment period.

David Hawkins, a leader of the climate program at the Natural Resources Defense Council, which produced detailed research that clearly influenced the EPA's proposal, said the draft rule's numbers "reflect a cautious assessment of our capacity to clean the power fleet." He said NRDC would present its own analysis, "which shows we can hit cleaner targets."

One reason utility companies in many states may be able to hit the targets is that EPA is allowing states extraordinary flexibility in how they choose to achieve them—by closing old, dirty and inefficient plants, by switching over to natural gas, by adding carbon-free renewable or nuclear power, or by managing demand through incentives and efficiency measures. States will be able to go it alone or to join in regional compacts like an interstate cap-and-trade arrangement that is already in effect in the northeast. Known as RGGI, for the Regional Greenhouse Gas Initiative, it has already provided striking results.

"This plan is all about flexibility," McCarthy said. "The glue that holds this plan together, and the key to making it work, is that each state’s goal is tailored to its own circumstances."

But that's another way of saying that EPA has not set the bar very high for several coal-dependent states. Each state's individual target for emissions is quantified in the number of pounds of pollution its local utilities can emit per unit of electrical power generated. Montana, Kentucky, North Dakota, West Virginia and Wyoming, the five states treated the most gently, will be allowed to emit several times as much carbon dioxide as states like Washington and Massachusetts, which have already cleaned up.

Meaningful, but Achievable

Obama has already achieved landmark fuel-efficiency standards for automobiles during his first term. If he can leave office with emissions from fossil-fuel power plants on a downward slope as well, he could be the first president to see global warming pollution trends decisively reversed on his watch. The feat would be all the more notable as a solo performance, achieved without Congress passing new legislation.

Indeed, even before the Obama plan was made public, Republican leaders in Congress denounced the proposal and said they would try to defeat it legislatively. On Monday, Rep. John Boehner of Ohio dismissed it as "nuts."

But the White House and the EPA are not shying away from that fight, which they think has broad public support as well as many sympathizers in the business world, where there would be winners as well as losers.

"Implementing the new limits on carbon emissions will be easier than some have suggested and, at the same time, provide economic opportunity in terms of investment and job creation," declared a statement from the Business Council for Sustainable Energy, a clean energy group.

The administration emphasizes that the reductions in carbon dioxide emissions will automatically result in less smog and soot pollution as well, which means more healthy air to breathe. Documents released today said there would be thousands fewer heart attacks and tens of thousands fewer asthma attacks brought on by air pollution once the rules take hold.

Combining these health benefits with estimates of avoided future costs from the drought, flood, fire and other damages associated with climate change, the EPA estimated that the total benefits from its proposal could run somewhere between $50 billion and $100 billion a year. Even though predictions of costs and benefits years in advance are never precise, the agency is making the case that here the benefits far outweigh the costs.

Pro-coal critics of the rules have argued that they will surely drive up electric bills, but McCarthy declared that this was flat out "not true."

Given the stiff opposition in some quarters, it's not clear how much more the administration might have dared to seek.

It also probably could not have gotten away with less, not while adhering to its promise to reduce nationwide emissions of carbon dioxide 17 percent by 2020, and much more in the decades to follow, as part of the global effort to fight global warming.

Nicholas Stern of the London School of Economics, long a leading voice for addressing climate change aggressively, said this proposal would keep the United States, along with China and the European Union, "approximately on track to meet the targets they agreed to" in United Nations talks. However, he said, they still "need to increase the ambition of their emissions cuts to be consistent with the overall goal of delivering a reasonable chance of avoiding dangerous global warming."

McCarthy, herself an accomplished environmental negotiator, is trying to come up with a formula that is strong enough to be meaningful but flexible enough to be achievable.

"The most costly thing we can do," she said on Monday, "is nothing."

Gina McCarthy's remarks announcing the new climate rule:

 

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