The U.S. Environmental Protection Agency’s proposed carbon dioxide ban by 2042: Implications for power plant operations and climate and environmental policy

Overall, the agency says that the rule could curb US emissions of CO2 by more than one billion tonnes by 2042 — equivalent to the annual carbon emissions of Japan — while racking up as much as US$85 billion in climate and health benefits. “The public health and environmental benefits of this proposed rule will be tremendous,” said EPA administrator Michael Regan at a press conference on 10 May, and it will have minimal impacts on electricity prices.

The most ambitious plan to address climate change of any major party candidate in U.S history was submitted by President Biden.

Scientists say we need to limit warming to 1.5 Celsius over pre-industrial levels to avoid the worst effects of climate change. Global average temperatures have already risen about 1.1 degrees Celsius.

Dallas is an economist with Resources for the Future, a nonpartisan research organization that focuses on energy and environmental policy.

One of the core questions will be whether CCS is an economically viable technology — or whether the new EPA rule has actually been designed to push electric utilities away from fossil fuels and towards cleaner energy sources. At the press conference, Regan addressed the concern. He acknowledged that some power plants will be closing due to the rule, but said that it was up to the company to make the decision.

The US Environmental Protection Agency issued a regulation on 11 May which lays out requirements for power plants powered by natural gas and coal, which are currently responsible for over 1.5 billion carbon dioxide emissions annually in the United States. Large coal-fired power plants that plan to operate beyond 2040 would need to use carbon-capture and sequestration technology (CCS) to reduce their emissions by 90%, for instance; major gas-fired plants could deploy either CCS or transition to clean hydrogen (produced with minimal carbon emissions) as a fuel source. The EPA will accept comments on the proposal for 60 days.

Patrick Morrisey is the attorney-general of West Virginia. The new rule, he said “just seems designed to scare more coal-fired power plants into retirement”. West Virginia has a large coal industry and last year helped to bring the case against the EPA to the Supreme Court. He expected that we would be able to prevail in court against the agency.

Only one power plant in the US is currently equipped with carbon capture and it will only be able to keep operating for a few years before suspending operations. According to a report by the Government Accountability Office, $684 million was burned on that carbon capture project and five other planned coal plants that never got off the ground.

For more than a century, owners of these plants have been allowed to release greenhouse gasses into the atmosphere. If these proposed regulations are finalized, they would come close to putting a stop to that practice.

The rules are almost certain to be challenged in court by the fossil fuel industry and its allies.

Reducing other air pollutants such as particulate matter would bring health benefits, according to Regan. The EPA projects that in 2030, the proposed rules would prevent 1,300 premature deaths, more than 800 hospital and emergency room visits and more than 300,000 cases of asthma attacks. While the rules could increase electricity prices a “negligible” amount, the agency values the net climate and health benefits would be up to $85 billion.

The coal industry and its allies were criticized even before the proposed rules were announced.

“This Administration is determined to advance its radical climate agenda and has made it clear they are hell-bent on doing everything in their power to regulate coal and gas-fueled power plants out of existence,” said Sen. Joe Manchin, D-WV, in a statement released by his office. The Manchins own a coal company, and they are also the people of the state where coal remains a powerful business. Manchin said he would oppose the Biden administration’s EPA nominees until the White House halts “their government overreach.”

Preserving coal-fired electricity is a priority for people in West Virginia, which is home to the major industry of coal. State regulators recently approved a $3 million per month surcharge on customers’ bills to keep a coal plant from shutting down at the end of May. Customers will pay the subsidy even if the plant doesn’t generate electricity, though it will keep the facility’s 146 employees on the payroll.

Patrick Morrisey is the Attorney General of West Virginia, who is also running for governor. He’s expected to lead a similar legal challenge to these rules, once they are finalized next year.

David Doniger, the climate and clean air programme leader for the Natural Resources Defense Council in New York City, is very pleased with the new framework. Nonetheless, Doniger says that his group will push the EPA to implement tougher measures in the final regulation.

Whether the rule holds up to court challenges will hinge in part on the argument that CCS is ready for prime time. It is, experts say, due to new tax incentives that are supposed to drive down the cost of technology. Howard Herzog is an engineer at the Massachusetts Institute of Technology who studiesCCS and says economics is the biggest barrier to widespread use of CCS.

McNamara says that the current EPA proposal is just one piece of a larger puzzle with other regulations on hazardous pollutants, as well as massive public health incentives for low-carbon energy. The question facing regulators, utilities and communities will be what makes the most sense: investing in CCS technologies to prolong the life of a fossil-fuel industry with enormous impacts on climate and public health, or investing in clean energy? “We feel very strongly clean energy will be the superior choice,” McNamara says.

The technology is ready to be implemented at a reasonable cost according to officials from the EPA. Many people agree with them. Doniger says that the technology has not been more used in the past because there are no regulations, and it is cheaper to dump emissions into the atmosphere.

How things play out will vary by plant. John Thompson, an energy analyst for the Clean Air Task Force, says that some gas fired plants that run frequently might be candidates for a CCS retrofit as electric utilities will probably close down older coal-fired power plants. The scales could be tipped by a combination of economic incentives that lower the cost, and regulations that require action, he adds.

The synergy between the rule that says “Thou shalt do this” and the tax credit that says “This isn’t very expensive” is what you get. “The potential is there for deep reductions in emissions.”