Biden EPA Narrows Power-Plant Rule With Plan For Later Curbs on US Gas Fleet

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The Constellation Energy Handley Generating Station in Fort Worth, Texas.

The Biden administration is narrowing the scope of its pending rule to cut greenhouse gases from the electricity sector as it develops a new initiative to set stronger pollution limits for natural gas plants.

The move by the Environmental Protection Agency includes delaying requirements for some existing gas plants that environmentalists say are urgently needed to slow global warming. Instead, agency officials say they will establish an additional, broader rule targeting every gas plant operating in the US, promising it will lead to far greater reductions in toxic pollutants and greenhouse gas emissions.  

The two-fold strategy is an attempt by the administration to respond to environmentalists pushing for more aggressive climate action while also locking in strict requirements for coal plants to safeguard against future legal attacks or repeals in Congress. But the move carries risk because the new mandates are unlikely to be in place until after the presidential election. 

“This is a much more comprehensive and thoughtful approach that possibly leads to more flexibilities, more choices for control technologies, more pollution reduction — and it’s responsive to all of our stakeholders,” EPA Administrator Michael S. Regan told Bloomberg News in an interview Thursday. “It is the decision of the agency and also a conscious decision of many of our stakeholders to say, ‘Let’s do better, let’s be more comprehensive, and let’s take the time to do that.’”

The approach underscores the legal and political challenges bedeviling President Joe Biden’s push to fight global warming as extreme weather heightens the urgency for action. The EPA rule capping greenhouse gas emissions from existing coal and future gas plants is one of the administration’s most sweeping regulations and a cornerstone of Biden’s climate agenda.  

The Constellation Energy Handley Generating Station in Fort Worth, Texas.Source: Bloomberg

EPA plans to finalize the first set of standards — targeting existing coal plants and gas plants built to replace them — in April. Coal plants are the largest source of greenhouse gas emissions from the US power sector.

“Moving forward with standards for existing coal plants and new gas plants will address two burning priorities,” said Abigail Dillen, president of the Earthjustice advocacy group. “Tackling dirty coal plants is one of the single most important moves the president and EPA can make to rein in climate pollution,” and, “as utilities propose new fossil gas plants, we absolutely have to get ahead of a big new pollution problem.”

Regan promised to move “expeditiously” on the second piece of the strategy, aimed at existing gas plants. The EPA begins meeting with stakeholders on the initiative next week, but Regan did not provide a specific timeline for finalizing the rule. The measure would almost certainly come too late to be shielded from easy congressional repeal under fast-track procedures. 

It’s not clear a final rule would be done before Inauguration Day in January, heightening risks the whole effort could be quashed if Biden isn’t reelected.

Developing a rule for the nation’s existing fleet of gas plants is a potentially colossal undertaking — requiring the EPA to develop strategies for reining in a variety of pollutants from facilities with vastly different uses and operations in comparison to the relatively homogeneous US coal fleet. 

The agency was running out of time to finalize a rule to cover existing plants while ensuring it would stand up to legal challenges, according to people familiar with the matter who asked not to be identified because the deliberations were private.

Regan, however, said the shift in strategy was driven by a desire to respond to a wide range of stakeholders. Some advocates wanted EPA to cover more gas plants. Other environmental justice leaders asked the agency to better address pollutants harming air quality in communities near power plants, in addition to greenhouse gases that fuel global warming. The rule would seek to rein in toxic air pollutants, such as cancer-causing formaldehyde, too.

“We understand the urgency of this climate crisis, but we also understand the urgency of front line communities and the disproportionate impact of many pollutants that our communities are seeing,” Regan said. “There’s a lot of pressure here to move as quickly and as strategically as possible.”

The effort will capitalize on historic incentives for renewable power and clean energy in the Inflation Reduction Act. 

“President Biden’s ambitious climate and economic agenda is laying the foundation for a fully decarbonized power sector,” White House National Climate Advisor Ali Zaidi said in a statement. 

Pushing back requirements for existing gas plants is a disappointment to some environmentalists who had lobbied the administration to go further by expanding the pool of gas-fired plants in the rule that takes effect in April. The EPA Science Advisory Board — a panel of experts that reviews how the agency uses research and technical information — also has issued a draft recommendation for “substantial increases in the stringency of the proposed rule” so it is aligned with the administration’s climate goals.

“EPA already has all the information it needs to address carbon emissions from the gas fleet,” and “there is no need to wait,” said Frank Sturges, an attorney with the Clean Air Task Force. “The public needs a firm timeline and commitment to control greenhouse gas emissions from existing gas plants and we need to know how stringent those controls will be.”

Under the initial proposal unveiled last May, large, frequently run gas-fired power units would have been required to replace 30% of their fuel with hydrogen by 2032 or install carbon-capture systems by 2035. Existing coal-fired power plants could keep operating without new pollution curbs as long as they close by 2032 — or 2035, if they ran far less frequently. 

The proposal would only have applied to existing gas plants that have more than 300 gigawatts of capacity and run half the year or more. That’s less than a fifth of US gas-fired generating capacity. As a result, the biggest emission reductions under the proposal would have come from existing coal plants and new gas facilities. About 20% of the cuts would have come from existing gas plants, according to government studies

The provisions targeting existing gas plants were among the most controversial — drawing warnings from from some utilities and grid managers who warned they’d force plants to close early and make grids far less reliable. Gas plants are widely seen as necessary to back up the ebbs and flows of wind and solar on the grid until energy-storage systems and other technologies can do the job.

The Edison Electric Institute, which represents some of the nation’s largest utilities, said it welcomed EPA’s acknowledgment of its concerns about the initial proposal. “We look forward to continuing to work constructively with Administrator Regan,” said Emily Sanford Fisher, an executive vice president for the trade group.

The EPA’s work will face inevitable legal challenges — potentially before the same Supreme Court that ruled against an earlier EPA approach that sought to shift electric generation from fossil fuels to renewables. By waiting to tackle existing gas plants, the EPA’s more targeted rule focusing on existing coal and new gas facilities is potentially more legally resilient.

The measure will deliver “real and substantial carbon reductions,” but the “EPA needs to finish the job without delay,” said Manish Bapna, president of the Natural Resources Defense Council. “We can’t tackle climate change and clean up air pollution without slashing emissions from the existing gas-fired power plants already pumping huge amounts of carbon and other dangerous pollutants into the air.”

(Updates with comment from White House climate advisor in 14th paragraph.)

©2024 Bloomberg L.P.

By Jennifer A. Dlouhy


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