Trump’s Clean Power Plan Replacement Is WORSE Than Nothing

The Clean Power Plan replacement proposed today by Acting EPA Administrator Wheeler demonstrates the Trump EPA’s unflagging commitment to propping up polluters. The proposal is designed to require power plants to do nothing to reduce their carbon pollution, and it could even result in greater climate-polluting emissions—a worse than do-nothing replacement for the Clean Power Plan.

To prop up failing coal-fired power plants, the proposal sets paltry pollution limits based on minimal “tune-ups” at those power plants and then authorizes states to weaken the standards even further—or even eliminate them altogether. On top of that, the proposal would create new loopholes by gutting New Source Review permitting requirements, enabling power plants to increase their emissions.

To try to justify the CPP rollback, the proposal exaggerates the compliance costs and underestimates the health and environmental benefits of reducing power plant pollution. But despite these accounting gimmicks, EPA’s own calculations show that the compliance costs of the Trump proposal will barely save any compliance costs compared to the CPP, and could even cost more.

The Clean Power Plan was a critical first step toward reducing power plants’ climate changing pollution. In the face of record heat waves, raging wildfires, and rising seas, Trump and Wheeler are proposing increased carbon pollution and higher compliance costs – a giveaway to polluters that will exacerbate climate change and threaten our health and safety.

Last week, David Doniger posted a run-down of the Clean Power Plan’s history and the Trump administration’s efforts to unwind it, and yesterday I rebutted Wheeler's misleading talking points spinning the proposal. Here, I’ll give a quick overview of the proposed CPP replacement that came out today:

Setting a Low Bar

The Clean Air Act requires EPA to set limits for existing sources of pollution based on the reductions achievable by the “best system of emission reduction.” Acting Administrator Wheeler is proposing now that the best system of emission reduction (BSER) for power plants should be limited to only the most minimal improvements to the efficiency of coal-fired plants, known as “heat rate improvements.” That’s it. This means investments in wind and solar power, or switching plants to burn lower-carbon fuels, are off limits under this proposal.

The Wheeler proposal is based on a legal theory, advanced in former Administrator Pruitt’s proposed CPP repeal, that the best system of emission reduction is limited to measures that “can be applied to or at a single source.” We’ve repeatedly shown that the Clean Air Act sets no such restriction on the best system of emission reduction. Moreover, even if one were limited to an “applied to” or “at” the plant restriction, there are a several additional such measures and emission reduction strategies that EPA barely considered in the proposal, including co-firing with natural gas or deploying carbon capture and sequestration.

Nevertheless, Wheeler proposes only to identify “heat rate improvements” as the best system of emission reduction for coal power plants, and nothing for gas plants. The proposal provides a list of heat rate-improving measures, and then leaves it up to the states to consider those measures in setting standards for each coal plant. Most of the listed measures have a heat rate improvement potential of less than one percent.

Heat-rate improvements can even backfire. Miniscule efficiency improvements may slightly reduce a coal plant’s emission rate (that is, the quantity of CO₂ emitted per megawatt hour of generation), but a coal plant that operates more efficiently may be called upon to run more hours, increasing the total amount of CO₂ emitted overall. The proposal acknowledges the possibility of this “rebound effect.” Instead of trying to prevent the rebound effect, Wheeler proposes a loophole to encourage it by revising the New Source Review program so that these increased emissions would not trigger requirements for installing the “best available control technology” under another portion of the Clean Air Act, as discussed below.

With little justification, the proposal simply rules out all other emission-reducing measures that can be implemented “at” a power plant, including carbon capture and storage and co-firing of natural gas at coal-fired power plants. The proposal also entirely declines to regulate natural gas-fired plants, concluding that making heat rate improvements to such plants would be too expensive and achieve minimal emission reductions.

Letting States Lower the Bar Further

Under the guise of cooperative federalism, Wheeler proposes to simply abdicate EPA’s obligation to set the level of emission reduction that existing sources must achieve.

Flouting EPA’s longstanding practice, the CPP replacement proposal asserts that EPA’s only role in regulating existing pollution sources under Clean Air Act section 111(d) is to provide information to the states about the degree of emission reduction that the “best system of emission reduction” might achieve, leaving the rest up to the states.

Here, EPA proposes to provide states a list of measures and their heat rate improvement potential, and then let each state decide how to limit each coal-fired power plant’s emissions. States are also free to give their plants a total pass under the guise of considering their “remaining useful life.” EPA will let states set weaker standards—or no standards at all—letting old, inefficient coal-fired power plants continue to emit carbon pollution unchecked.

Moreover, the proposal seeks to provide flexibility for power plants in complying with the lenient standards set by states, while refusing to consider those compliance flexibilities in setting the stringency of the standards. If flexible measures like trading or averaging are available for compliance, those measures must also be considered in identifying the BSER and setting the emission standards based on that system.

Creating a Loophole to Allow for More Pollution

The proposal acknowledges that a power plant that makes heat rate improvements may end up increasing its annual emissions such that the modification would require a major New Source Review (NSR) permit. Under the NSR program, the Clean Air Act requires existing power plants to obtain a permit when it undertakes “any physical change in . . . a stationary source which increases the amount of any air pollutant emitted.”

To enable coal-fired power plants to increase their emissions without triggering NSR requirements, Wheeler proposes to revise the NSR applicability regulations to add an “hourly emissions test”—only if a modification increases the plant’s hourly emissions rate would the plant need to assess whether its annual emissions will increase, and therefore whether a major NSR permit is required.

This proposed loophole illustrates the absurdity of the CPP replacement proposal—Wheeler proposes that the best system of emission reduction is heat rate improvements only, but those modifications may indeed increase the power plant’s annual emissions, triggering NSR requirements. Given everything we know about how the power sector is reducing carbon pollution by shifting to cleaner forms of generation, how can this proposal possibly be the best system?

More Pollution…AND More Expensive?

Under every illustrative scenario Trump’s EPA analyzed, the proposed CPP replacement would result in increased emissions of CO₂ and other key pollutants—sulfur dioxide (SO₂), and nitrogen oxides (NO_X) relative to the Clean Power Plan. EPA also estimates there will be “forgone climate benefits and forgone ancillary health co-benefits” under every analytical scenario—that is, the proposed replacement would dramatically reduce the benefits of reducing CO₂ and other power plant pollution as compared with the CPP.

Furthermore, EPA concludes that, under some illustrative scenarios, the compliance costs of its replacement proposal are in fact greater than those of the original Clean Power Plan. You read that right: Trump’s EPA is proposing to replace the CPP with a scam that is less protective, but more costly. Wheeler’s proposal begrudgingly acknowledges that, as the power sector has become less carbon intensive in recent years, the projected compliance costs of the CPP are now significantly lower than what was estimated back when the CPP was finalized.

In the Regulatory Impact Analysis accompanying the proposal, Trump’s EPA cooks the books with the same accounting gimmicks as it used in the Clean Power Plan repeal proposal last year to inflate the CPP’s costs and hide its benefits. For example, the RIA underestimates the climate benefits of the Clean Power Plan by using an “interim domestic social cost of carbon” that ignores the global impacts of climate change. 

This is especially troubling today when we’re seeing climate impacts across the country and around the world in unprecedented heat waves, wildfires and weather extremes. Trump and Wheeler turn a blind eye to these impacts to put corporate polluters ahead of our health and environment.

NRDC will have plenty to say in our comments on the proposed CPP replacement. If Trump finalizes this worse-than-do-nothing replacement, we’ll see them in court.