EPA's New Power Plant Rules Are a Big Step Forward

You've got to credit the US Environmental Protection Agency. When the Supreme Court went out of its way to strike down (never-enacted) Obama-era power plant rules in last year's disastrous "West Virginia v. EPA" decision, some assumed that was that for federal regulations in this sector.

But instead, EPA went back to the drawing board and recently came back with a new set of proposed rules that are equal parts common sense and breathtaking ambition.

Common sense, because when your goal is staggeringly large – say, for example, halving emissions in the world's largest economy in less than a decade – the obvious move is to look for where you can make the biggest gains with the fewest number of actors.

And when it comes to cutting emissions, few sectors have the potential for big, big gains of the US power sector.  According to Climate TRACE, the power sector is responsible for nearly a quarter of US emissions, second only to transportation in contributing to global warming. There's no secret about where either, with the US Energy Information Administration (EIA) reporting that 55% of the sector’s CO2 emissions came from coal plants and 43% from natural gas in 2022.

To put it plainly, there's no way we can cut US emissions in half by 2030 – which the science is crystal clear needs to happen globally if we're going to have any shot at holding warming to something like livable levels – without huge cuts to power sector pollution. Fast.

The good news here  is that if enacted, EPA's new power plant rules will do just that. The rules would mean that some 600 million metric tons of CO2 – equal to about half the passenger vehicles from US roads each year  – would be avoided by 2042.

That's ambition.

The Benefits Go Beyond Climate

The climate benefits of slashing power plant pollution are immediately clear, but what's less widely understood is how other forms of pollution – harmful smog, particulate pollution, and nitrogen dioxide – that come spewing out of smoke stacks are silent killers. One recent report found that coal plant pollution contributed to as many as 3,800 premature deaths in the US each year, many happening many miles away from the plants themselves. Another study found that air pollution from burning fossil fuels in power plants and other sources caused 8.7 million deaths worldwide in 2018 - roughly one in five deaths that year.

It goes without saying that both these deaths and the long list of other health impacts stemming from exposure to this pollution – heart attacks, difficulty breathing, aggravated asthma, and more – are not equally distributed. Research shows that communities of color – and Black Americans in particular – live with significantly more air pollution from power plants and other sources than white Americans – and pay the price with their health.

EPA's rule takes aim at this glaring injustice head on and – by significantly reducing air pollution –  could help avoid by 2030:

• About 1,300 premature deaths.
• Over 800 hospital and emergency room visits.
• More than 300,000 cases of asthma attacks.
• About 38,000 school absence days.
• Around 66,000 lost workdays.

These benefits would particularly be felt in frontline communities, leading to economic savings of up to $85 billion in net climate and health benefits by 2042.

Seeing these numbers, many people will ask, “How will this affect my electricity bills?” According to EPA Administrator Michael Regan, electricity costs are expected to rise by about 2% in 2030 before essentially levelling out in the following years. That’s a small price to pay when we consider the billions we’ll save in avoided health costs. With the average US electric bill around $121 per month in 2021, that means an increase of less than $2.5o each month. (Which, as a tradeoff for clean air and a healthier climate sure buys you a lot.)

So How Does the Rule Work?

The rule sets strict limits on the amount of carbon pollution power plants can release, but gives plant operators the freedom to choose how they get there. In practice, many will likely use one or both of two methods: carbon capture and storage (CCS) technologies and mixing clean hydrogen in natural gas co-fired plants. At the moment, CCS technologies are still in the earlier stages of development and deployment and are extremely expensive.  (Currently, there’s only one power plant using CCS at scale in the world: the Boundary Dam Power Station in Saskatchewan, Canada.)

Gas plants may also choose to blend low-carbon hydrogen with natural gas to reduce emissions. At least 30% of the blend must come from low carbon hydrogen by 2032 and 96% by 2038. The rule defines low-carbon hydrogen as having a carbon intensity of no more than 0.45 kg of CO2 equivalent per every kilogram of hydrogen during the production process. How this would be determined is not part of the proposed rule, though EPA has requested public comments on the subject.

Administrator Regan argues that this rule “relies on proven, readily available technologies.”  The expectation is that implementing the rule would drive greater investment into these technologies, leading eventually to both lower costs and improved capture rates for pollution. 

Along with the energy from broader market forces, last year’s Inflation Reduction Act (IRA) updated 45Q, the tax credit for capturing CO2, from $50 to $85 per metric ton. It also made it easier to access the credits and enabled it for smaller CCS projects. Together, these measures make many CCS initiatives more cost-effective. The IRA also provided billions in support for clean energy, making it easier than ever to switch from dirty fossil fuel power plants to wind, solar, geothermal, and more.

The point to underscore here is that CCS cannot be used as a means to keep burning fossil fuels in perpetuity. Not if we're serious about a just transition to a clean energy economy. What it can do long-term is help decarbonize hard to decarbonize sectors such as cement, steel, and fertilizer production. Though other pollution not captured by CCS will remain a concern for frontline communities.

Will this rule cause coal power plants to shut down? Very likely. It may make it economically unfeasible to keep some of them running, especially since clean energy has made that a reality in most of the country already. For example, a study published earlier this year found that it’s cheaper to replace 99% of US coal plants with new local wind and solar resources. So it’s not a stretch to see why nearly a quarter of the coal fleet is already scheduled to retire by 2029.

Good but Not Perfect

The rule is a major step forward, but it’s not perfect. The current proposal includes exceptions

for coal plants that are scheduled to retire by 2032  and gas “peaker plants” that operate at less than 20% of their capacity.

Peaker plants provide backup power to the grid during times of peak demand. Think August days in the middle of heatwaves when hundreds of thousands of homes and offices simultaneously crank up the air conditioning. There are over 1,200 of these plants in the US. About 61 million people live within three miles of these plants, and about two-thirds are sited in low-income communities.

The implications of giving these plants a pass – both for the climate and any basic sense of justice – are crystal clear. No one should have to live in the shadow of a pollution factory just to keep the lights on over on the other side of town. That's why we're calling on EPA to enact the strongest possible limits on power plant pollution with zero exceptions for peaker plants.

We can do better. Market forces are already pushing us toward a cleaner power sector. EPA's new rules are a huge opportunity to speed up this process at a time when we are running out of time to stop rising temperatures. But it has to be done right. We have the tools to do it and the time is now.

Tell EPA: We Can Do Better

Take action today and tell EPA to enact strong limits on power plant carbon pollution with no exceptions for peaker plants.