49 States Making Plans for EPA Carbon Rule—Even the Ones That Hate It

Twelve states have sued the EPA, 12 others have created legislative hurdles. Still, most are planning to meet EPA's carbon reduction targets.

EPA Administrator Gina McCarthy addresses climate advocates at the 2014 meeting of the activist network RE-AMP in Chicago. Nearly every state, even those suing the EPA, has made efforts to begin complying with the agency's Clean Power Plan to dramatically cut carbon emissions from power plants. Credit: Eugene Kim

Editor's note: This article is part a series of stories by InsideClimate News reporters exploring the future of the coal industry, Coal's Long Goodbye.

The Environmental Protection Agency's plans to finalize the rules on carbon emissions from power plants are still several months away. But most states, even those challenging the agency in court, are already investigating ways to comply.

The EPA expects 49 states to submit plans once the rules are finalized. The non-partisan group Great Plains Institute for Sustainable Development, which has been organizing talks in the Midwest on the Clean Power Plan, says 41 states have joined regional groups exploring options to comply with the rule.

"My guess would be all 49 are," said Doug Scott, a vice president at the Great Plains Institute. "Whether they're part of formalized groups or not, all the states are trying to figure out what the best options are."

Many of these states have been staunchly opposed to the rule. Twelve have sued the EPA, claiming the rule is unlawful and amounts to a federal power grab. And at least half a dozen other states have set up legislative hurdles for the environmental agencies in charge of putting together a compliance plan.

Yet, the vast majority of state agencies charged with drafting a compliance plan have sidestepped these political fights and begun work on plans that might meet the EPA's carbon reduction targets.

"Even the reddest states have recognized that while the political leadership may want to go ahead with challenging the rule, if those challenges don't prevail the governors will come back and say, 'We lost, now what are we going to do?'  It would be irresponsible for the agencies to not have a Plan B developed," said Ken Colburn, a senior associate at The Regulatory Assistance Project, a nonprofit providing technical assistance on energy and the environment.

Obama's Climate Rule Under Attack

State environmental and utility agencies have been busy laying the groundwork: organizing meetings with the coal industry, power companies and clean energy groups; consulting models to evaluate carbon reduction strategies; participating in workshops; and discussing options with neighboring states to submit a regional plan.

Some states, such as California, New York and its Northeast neighbors, are ahead of the curve. Having spent years establishing a carbon trading program, the Northeastern states already have mature and sophisticated plans to reduce emissions that will likely satisfy the EPA's requirements. And on the West Coast, California's legislative efforts have ensured that the state is on track to cut carbon emissions.

Others, however, are starting from scratch. Coal states, most of which are suing the EPA over the rule, have little experience in cutting carbon emissions. Few have overarching climate policies or strategies to encourage investments in renewables, such as solar and wind energy.

The federal carbon rules, unveiled in June 2014 and expected to be finalized this summer, aim to decrease carbon dioxide emissions from the nation's power plants. The EPA, the agency that formulated the rules and is leading the effort, has assigned state goals for emission reductions reductions for every state except Vermont because it does not have fossil-fired plants. The targets range from 11 percent (North Dakota) to 72 percent (Washington) by 2030. Once the final rules are announced, states are expected to submit compliance plans for meeting those targets. They have one year to submit the plans, with the possibility of extensions.

An analysis by the Union of Concerned Scientists, a nonprofit environmental group, found that 31 states are well on their way to meet the EPA's interim targets. In fact, states like coal-heavy Kentucky will likely be able to meet their final targets without initiating significant changes, due to coal plant retirements triggered by other federal regulations and competitive pressure from natural gas.

An Encyclopedia of Compliance Options

As states begin to explore their options, a host of national organizations, consulting firms and regional utility and environmental associations have been holding talks and workshops to evaluate models, discuss options and engage with groups affected by the energy transition.

Groups such as the National Governors Association and the National Association of Clean Air Agencies (NACAA) have taken an early lead to help states navigate the regulations.

Last month the NACAA released a 465-page encyclopedia of options that states could pursue to meet their targets. The report explores 25 approaches to reduce carbon emissions and discusses their regulatory impact, reduction in carbon levels and costs.

"There are enough...entrees in our menu that can whet the appetite of any state who is hungry to reduce greenhouse gas," said Bill Becker, executive director of the NACAA, which represents most of the state environmental agencies charged with carrying out the rule. "These are all the things we can think of that...a state or locality can adopt either in complying with the Clean Power Plan or any state or local climate action plan."

The strategies in the report range from those already cited by the EPA in its rule––promoting clean energy, retiring aging power plants and switching fuels––as well as innovative options such as trying to reduce power loss during transmission and improving coal quality. The report also listed controversial programs such as carbon capture, which currently does not exist on a commercial scale, and carbon trading, which is still gaining political support.

Becker said his organization covered every option that could possibly reduce emissions, regardless of whether it is considered politically or economically feasible at this point.

NACAA has joined forces with two other national organizations that have skin in the game: the National Association of Regulatory Utility Commissioners and the National Association of State Energy Officials.

Becker said the three groups have been meeting every six months to share information and "better appreciate each other's responsibilities."

The National Governors Association has also launched an initiative to help states study ways to comply with the carbon regulations. In March, the organization selected four states––Utah, Pennsylvania, Missouri and Michigan––to participate in what it called a "policy academy."

"The goal of this effort is to help states examine cost-effective strategies for meeting the potential requirements of forthcoming federal regulations," said Jodi Omear, director of communications and marketing for the association. The participating states will receive guidance and technical assistance from NGA, consultants from the private sector, federal agencies, research organizations and academia, she said.

Only one state so far has publicly refused to submit a plan: Oklahoma. Gov. Mary Fallin issued an executive order in April directing state agencies not to come up with a plan to cut carbon pollution.

If Oklahoma ultimately refuses to submit a plan, the EPA will require the state to comply with a federal plan.

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