Selected category: Clean Air Act

EPA SmartWay and Clean Truck Standards Save U.S. Businesses Millions

(This post originally appeared on EDF+Business)

American businesses benefit tremendously from the robust voluntary and regulatory programs of the U.S. Environmental Protection Agency. These programs are now under threat of massive budget cuts and regulatory rollbacks.  In the coming weeks and months, the experts at EDF+Business will examine what a weakened EPA means for business.

 

It’s safe to say that the EPA isn’t having the best week. Whether it was new administrator Scott Pruitt vowing to slash climate and water protections at CPAC or this week’s reveal that President Trump wants to slash a reported 24 percent of its budget, the EPA has taken a beating recently. However, what may not be as obvious is that slashing EPA’s budget and reducing funding to key programs actually hurts businesses that have greatly benefitted from EPA programs.

A key example of how the EPA bolsters business is freight. In the freight world, the EPA has done a lot for companies’ bottom lines while protecting human health and that of the planet. Companies seeking to reduce freight costs and achieve sustainability goals across supply chains receive immense value from the EPA.  Two key programs that provide this value are the U.S. EPA SmartWay program and the Heavy-Duty Truck Greenhouse Gas Program.

A compelling value proposition for business

SmartWay was created in 2004 as a key part of the Bush Administration’s approach to addressing clean energy and climate change. The program has grown from fifteen companies at its start to nearly 4,000 companies today. The program attracts strong private sector participation because it offers a clear and compelling value proposition: freight shippers gain access to information that enables them to differentiate between freight carriers on emissions performance.

This saves shippers money and cuts carbon emissions. Freight carriers participate in the program to gain access to large shippers, such as Apple, Colgate-Palmolive and Target.

The EPA SmartWay program is not only a popular program that is delivering billions of dollars of annual savings to the U.S. economy, it is also a core strategy for companies to reduce their freight emissions. The agency has calculated that since 2004, SmartWay partners have saved:

  • 8 million metric tons of carbon emissions
  • Over 7 billion gallons of fuel
  • $24.9 billion in fuel costs

To put it in perspective, the reduction of 72.8 million tons of emissions is roughly the equivalent to taking 15 million cars off the road annually. The $25 billion in aggregate savings from this one program is more than three times the annual budget of the entire EPA.

Given the strong value proposition of the program, it is no surprise that many companies with existing science-based targets on climate emission reductions participate in EPA SmartWay, including: Coca-Cola Enterprises, Dell, Diageo, General Mills, Hewlett Packard Enterprise, Ingersoll-Rand, Kellogg Company, Nestlé, PepsiCo, Procter & Gamble Company and Walmart.

Clean fuel driving a healthy U.S. economy

Another key program that is saving companies billions is the Heavy-Duty Truck Greenhouse Gas Program. This program supports long-term cost savings and emission reductions through clear, protective emission standards with significant lead time.

The first generation of this program, running from 2014 to 2017, was finalized in August 2011 and will cut oil consumption by more than 20 billion gallons, save a truck’s owner up to $73,000, deliver more than $50 billion in net benefits for the U.S. economy, and cut carbon dioxide pollution by 270 million metric tons.

The program was created with the broad support of the trucking industry and many other key stakeholders. Among the diverse groups that supported the standards were the American Trucking Association, Engine Manufacturers Association, Truck Manufacturers Association, and the United Auto Workers. The industry has embraced the new and improved trucks too.

The success of the first generation effort spurred the agency to launch a second phase that was finalized in August 2016. This effort stands to be a major success as well. The program is estimated to save:

  • 1.1 billion metric tons of carbon pollution
  • 550,000 tons of nitrous oxides and 32,000 tons of particulate matter (aka: harmful air pollutants)
  • 2 billion barrels of oil
  • $170 billion in fuel costs

This latest phase is also big hit with leading companies. More than 300 companies called for strong final standards during the rulemaking process, including PepsiCo and Walmart (two of the largest trucking fleets in the U.S.), mid-size trucking companies RFX Global and Dillon Transport, and large customers of trucking services General Mills, Campbell’s Soup, and IKEA. Innovative manufacturers, equipment manufacturers, and freight shippers have also called for strong standards.

The corporate support for these standards was so impressive that the New York Times issued an editorial illustrating a rare agreement on climate rules.

Every company that sells goods in the market benefits immensely from these two programs and many others from the U.S. EPA. Programs like EPA SmartWay and the Heavy Truck Greenhouse Gas Standards are saving companies and consumers billions of dollars annually, and are integral to corporate efforts to cut carbon emissions.

Looking ahead

In his remarks to EPA employees on his first day on the job, Pruitt acknowledged that “we as an agency and we as a nation can be both pro-energy and jobs and pro-environment…we don’t have to choose”. My hope is that this is a signal of open mindedness to a path forward would allow further improvements to the environment and the economy rather than roll-backs on vital programs and protections.

Perpetuating the belief that the EPA and business are at odds will not only hurt the environment, but would endanger American prosperity.

Also posted in Cars and Pollution, Greenhouse Gas Emissions, Policy, Setting the Facts Straight| Comments are closed

EPA by the Numbers — Longer, Healthier Lives Across America

The Environmental Protection Agency has restored healthier air and cleaner water for millions of Americans, bringing our country back from the brink of far-reaching – and dangerous – industrial pollution. All Americans in red, purple and blue states alike have benefited profoundly from the balanced safeguards EPA has put in place.

Gutting EPA, as proposed by some, imperils American lives, puts our children and communities at serious health risk, and will have lasting public health and environmental consequences for future generations.

Here is a snapshot of EPA by the numbers:

 

1970

EPA established with bi-partisan support by Republican President Richard Nixon

67

Percent of Americans across the country who think EPA should stay the same or be strengthened

230,000

Lives saved each year by EPA’s implementation of the Clean Air Act in 2020

2.4 million

Asthma attacks prevented each year by EPA’s implementation of the Clean Air Act in 2020

22.4 million

Avoided lost school or work days each year due to EPA’s implementation of the Clean Air Act in 2020

30:1

Ratio of benefits to costs– the Clean Air Act provides $30 in health benefits for every $1 invested in compliance

1,308

Number of enforcement actions concluded in fiscal year 2016 under the Clean Water Act and Safe Drinking Water Act

62 billion

Pounds of hazardous waste EPA enforcement actions required companies to commit to treat, minimize, or properly dispose of in fiscal year 2016

190 million

Cubic yards of contaminated soil and groundwater cleanup commitments secured in fiscal year 2016 alone (enough to fill the Empire State Building over 138 times)

13,500

Number of compliance inspections and evaluations EPA conducted in fiscal year 2016

15,376

EPA staff in 2016 – already down from 18,110 staff in 1999

11,532

EPA staff under the Trump Administration’s proposed draconian budget cuts (assumes a 25 percent cut in EPA staff). This would put staff near 1984 levels

40,000

Pounds of toxic mercury cut from coal plants by the Mercury and Air Toxics Rule

1

EPA Administrator who laughed about dismantling the EPA – 1 in over 40 years

 

EPA has saved and improved millions of Americans’ lives while our nation has also had tremendous economic growth and prosperity, as the graphic below demonstrates. Gross Domestic Product, population, vehicle miles traveled, and energy consumption have risen dramatically while the U.S. has reduced lethal particulates, lead, sulfur dioxide, smog, and other contaminants.

Unfortunately, many Americans still struggle with dirty air and unclean water supplies. And we are all at risk from the threat of climate change. The progress that EPA has made in protecting Americans needs to be continued and strengthened, not cut back. We need EPA operating on all cylinders – fully staffed — to protect human health and the environment for all Americans.

 

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EPA Has the Responsibility and the Tools to Address Climate Pollution Under the Clean Air Act

(EDF Attorney Ben Levitan co-authored this post)

It’s barely a week since Scott Pruitt was confirmed as EPA Administrator, and he has already provided yet another indication of why he has no business leading the agency.

In an interview with The Wall Street Journal, Pruitt says he wants to undertake a “careful review” as to whether EPA has the “tools” to address climate change under the Clean Air Act. Pruitt further states that EPA should withdraw the Clean Power Plan – a vital climate and public health measure to reduce carbon pollution from the nation’s power plants – and instead wait for Congress to act on the issue of climate change.

Those statements are contrary to the law and disconnected from reality. As Pruitt surely knows, the federal courts – including three separate decisions of the Supreme Court – have made it abundantly clear that the Clean Air Act requires EPA to protect the public from dangerous pollutants that are disrupting our climate. The courts have repeatedly rejected Pruitt’s theory that climate pollution is an issue that only Congress can address through new legislation.

Over the last eight years, EPA has demonstrated that the Clean Air Act is an effective tool for addressing the threat of climate change — by putting in place common sense, highly cost-effective measures to reduce climate pollution from cars and trucks, power plants, oil and gas facilities, and other sources. These actions under the Clean Air Act are saving lives, strengthening the American economy, and yielding healthier air and a safer climate for our children.

Pruitt’s casual willingness to abandon that progress based on a discredited legal theory demonstrates deep contempt for the laws he is charged with administering and the mission of the agency he now leads.

EPA Is Legally Obligated to Address Climate Pollution

The Supreme Court has repeatedly held that EPA clearly has the authority and responsibility to address climate pollution under the Clean Air Act:

  • In Massachusetts v. EPA (549 U.S. 497, 2007), the Supreme Court held that climate pollutants plainly fall within the broad definition of “air pollutants” covered by the Clean Air Act. The Court ordered EPA to make a science-based determination as to whether those pollutants endanger public health and welfare (a determination that EPA ultimately made in 2009, and that has been upheld by the federal courts).
  • In American Electric Power v. Connecticut (564 U.S. 410, 2011), the Supreme Court held that the Clean Air Act “speaks directly” to the problem of climate pollution from power plants.
  • In Utility Air Regulatory Group v. EPA (134 S. Ct. 2427, 2014), the Supreme Court held that the Clean Air Act obligated EPA to address climate pollution from new and modified industrial facilities.

In Massachusetts v. EPA, the Bush Administration’s EPA made — and the Supreme Court rejected —Pruitt’s same argument that EPA lacks the authority and tools to address climate pollution.

The Supreme Court said in no uncertain terms that:

The statutory text forecloses EPA’s reading … Because greenhouse gases fit well within the Clean Air Act’s capacious definition of ‘air pollutant,’ we hold that EPA has the statutory authority to regulate the emission of such gases from new motor vehicles. (emphasis added)

The Supreme Court went on to explain that – contrary to what Pruitt is now saying – Congress intended to provide EPA with the tools it needed to address new air pollution challenges, including climate change:

While the Congresses that drafted [the Clean Air Act] might not have appreciated the possibility that burning fossil fuels could lead to global warming, they did understand that without regulatory flexibility, changing circumstances and scientific developments would soon render the Clean Air Act obsolete. The broad language [of the Act] reflects an intentional effort to confer the flexibility necessary to forestall such obsolescence. (emphasis added)

The Court also found that nothing about climate pollution distinguishes it from other forms of air pollution long regulated under the Clean Air Act. It rejected the Bush Administration’s attempt to argue that climate pollution is somehow “different,” saying that theory was a “plainly unreasonable” reading of the Clean Air Act and “finds no support in the text of the statute.”

That was the law under the Bush Administration – and it remains the law today. It is a binding, rock-solid precedent regardless of who is running EPA at any given time.

Pruitt ought to know all this, because he was one of the Attorneys General who joined polluters and their allies in challenging EPA’s determination that climate pollution endangers public health and welfare.

That 2009 determination was in response to Massachusetts v. EPA, and it was based on an immense body of authoritative scientific literature as well as consideration of more than 380,000 public comments. Yet in their legal challenge to the determination, Pruitt and his allies again argued that EPA should have declined to make an endangerment finding based on the supposed difficulty of regulating climate pollution under the Clean Air Act.

A unanimous panel of the D.C. Circuit rejected those claims, finding that:

These contentions are foreclosed by the language of the statute and the Supreme Court’s decision in Massachusetts v. EPA … the additional exercises [state and industry challengers] would have EPA undertake … do not inform the ‘scientific judgment’ that [the Clean Air Act] requires of EPA … the Supreme Court has already held that EPA indeed wields the authority to regulate greenhouse gases under the CAA. (Coalition for Responsible Regulation v. EPA, 684 F.3d 102, D.C. Cir. 2012, emphasis added)

The Supreme Court did not even regard further challenges to the endangerment finding as worthy of its review. (See Order Denying Certiorari, Sub Nom Virginia v. EPA, 134 S.Ct. 418, 2013)

Pruitt’s suggestion that EPA should stop applying the Clean Air Act’s protections to an important category of pollutants – greenhouse gases – amounts to a repeal of Congress’s core judgment that all air pollutants that cause hazards to human health and the environment need to be addressed under the Clean Air Act. It is an audacious and aggressive effort to alter the Clean Air Act in a way that Congress has never done (and has specifically declined to do when such weakening amendments have been proposed).

EPA Has Established a Strong Record of Successful Climate Protections

Pruitt’s statements also ignore the pragmatic way in which EPA has carried out its legal obligations to address climate pollution. Since Massachusetts v. EPA was decided, EPA has issued common sense, cost-effective measures for major sources of climate pollution – including power plants; cars and trucks; the oil and gas sector; and municipal solid waste landfills.

These actions demonstrate that Pruitt is flatly wrong to suggest that EPA lacks the “tools” to address climate change under the Clean Air Act. They include:

  • The Clean Power Plan will reduce carbon pollution from the nation’s power plants to 32 percent below 2005 levels by 2030, while providing states and power companies with the flexibility to meet their targets through highly cost-effective measures – including shifting to cleaner sources of generation and using consumer-friendly energy efficiency programs that would reduce average household electricity bills by $85 per year. The Clean Power Plan will protect public health too, resulting in 90,000 fewer childhood asthma attacks, 300,000 fewer missed school and work days, and 3,600 fewer premature deaths every year by 2030. The value of these health benefits alone exceeds the costs by a factor of four, and the climate benefits are roughly as large.
  • EPA’s standards for cars and other light-duty vehicles, will save the average American family $8,000 over the lifetime of a new vehicle through reduced fuel costs – while saving 12 billion barrels of oil and avoiding 6 billion metric tons of carbon pollution. A recent analysis by EPA and the U.S. Department of Transportation found that manufacturers are reaching these standards ahead of schedule and at a lower cost than originally anticipated.
  • The most recent Clean Truck Standards, which were finalized in August 2016, will save truck owners a total of $170 billion in lower fuel costs, ultimately resulting in $400 in annual household savings by 2035 – while also reducing carbon pollution by 1.1 billion tons over the life of the program. These benefits are one reason why the Clean Truck Standards have broad support from manufacturers, truck operators, fleet owners and shippers.
  • EPA’s methane emission standards for new and modified oil and gas facilities, finalized in June 2016, will generate climate benefits equivalent to taking 8.5 million vehicles off the nation’s roads – while having minimal impact on industry.

When Scott Pruitt suggests that the Clean Air Act is a poor fit for regulating climate pollution, he overlooks the clear command of the statute, as confirmed repeatedly by the Supreme Court. He also ignores EPA’s successful history of issuing regulations that protect the environment while promoting significant health and economic benefits.

Pruitt might try to distort the truth in an effort to wipe climate protections off the books — subjecting our children and grandchildren to the dire health, security and economic effects of unlimited climate pollution in the process. But the law and the facts are not on his side.

EPA must address climate pollution under the Clean Air Act, and it has the tools to do so effectively.

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Investments to Meet Emissions Goals are Driving Innovation and Growth in U.S. Auto Industry

15261010832_b13a8d395c_kThe past couple of weeks have seen a whirlwind of announcements related to the U.S. auto industry.

The century-old industry has been hailed as the fastest U.S. job creator – expanding payroll by “nearly 35 percent” in recent years. Manufacturers have introduced dozens of new, fuel-efficient models. Technology companies and automotive manufacturers are collaborating more than ever to add features, and to get the world ready for self-driving vehicles.

The need for climate action has been a critical driving factor in each of these trends.

The Clean Car Standards have been focusing auto industry investment and innovations since they were finalized in 2010. Over that time, the automobile industry has made a dramatic return to profitability and added jobs – all while exceeding the Clean Car Standards. The industry has also started to bring to market a new generation of fuel-saving solutions.

Confirmation of these trends could be found at the recent Consumer Electronics Show and the Detroit Auto Show, where manufacturers paraded out their latest developments.

  • Ford stated that it expects sales of electric vehicles will overtake sales of gas-fueled vehicles within 15 years. Ford showcased its ability to improve conventional vehicles by unveiling the 2018 model Ford F150 – the best selling vehicle in the U.S. – with options for a more fuel efficient 3.3 liter six cylinder engine and automatic stop-start technology. It also announced new hybrid versions of the F-150 and Mustang by 2020. The company promised a new fully electric SUV vehicle with 300-mile range by 2020.
  • General Motors (GM) celebrated having the fully-electric, 238-mile range Chevy Bolt awarded the North American Car of the Year or Truck of the Year. The Chevy Bolt was previously awarded Motor Trend Car of the Year. The Bolt, which came to market last month, is also at the center of GM’s work on self-driving vehicle technology
  • Nissan announced a new generation of its LEAF electric vehicle, with “autonomous drive functionality" for highways.
  • Honda publicized its plan to introduce a new, U.S.-made hybrid vehicle in 2018 and roll out its Clarity Electric and the Clarity Plug-In Hybrid vehicles.
  • Toyota appointed its president (grandson of the company’s founder) to lead their newly formed electric car division, in an effort to “speed up development of electric cars.” 
  • Volkswagen – unveiled a prototype electric van capable of a 270-mile range and with room for eight-passengers. The company has committed to have at least 25 percent of its global sales be electric vehicles by 2025.
  • Samsung introduced a new lithium-ion battery cell for electric vehicles. The battery promises over 350 miles of range and a 20-minute fast charge. The battery is slated for production in 2021.
  • Tesla declared that its gigafactory for battery production was open for business. The Reno, Nevada facility already employees almost 3,000 workers, and is ultimately expected to employ 6,500 in full-time positions.
  • Mercedes announced in Paris last year that electric cars would account for 25 percent of the company’s deliveries in 2025, backed by plans to invest $1.1 billion in battery technology.

As these developments show, automakers and their suppliers are investing and bringing to market clean vehicle solutions beyond what even the Clean Car Standards require.

These companies are making these investments because there is a robust domestic market for clean cars. Electric vehicle sales in the U.S., for example, were up more than 50 percent in the second half of 2016 (compared to 2015).

Companies are also making these investments to stay competitive in a global race that will define the next chapter of mobility. GM, for example, had a third of its global sales in China in 2016. China is the largest market worldwide for electric vehicles and plug-in hybrid electric vehicles, and if U.S. automakers want to be competitive there they will need to stay on the leading edge of the technology curve. Autotomy and electrification will be the hallmarks of this new, global chapter.

By driving more investment in future offerings, the Clean Car Standards help position U.S. manufacturers to win this race at home and abroad.

This perspective was recently voiced by the United Auto Workers, which noted:

“Our competitors around the globe are working to strengthen environmental standards and it would be counterproductive to enact policies that provide disincentives for investing in advanced technologies and improving efficiency. History has taught us that a diverse fleet is essential for strong export sales and keeping jobs in the United States. Efficiency and emission standards can and must continue to be a win-win for the environment, working families, domestic manufacturing and the overall economy.”

We couldn’t agree more.

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2016 Wrap-Up: States, Power Companies Lead in Cutting Carbon; Election Not Slowing Expected 2017 Progress

(This post was co-authored by EDF Associate Charlie Jiang. It was revised on January 6, 2017)

The new Block Island Wind Farm in Rhode Island -- one of many examples of clean energy progress in 2016. Photo courtesy Deepwater Wind

The new Block Island Wind Farm in Rhode Island — one of many examples of clean energy progress in 2016. Photo courtesy Deepwater Wind

2016 was a big year for progress in the U.S. power sector. Renewable energy sources provided 16.9 percent of the country’s electricity in the first half of 2016, up from 13.7 percent for all of 2015. The country’s first offshore wind farm opened off the coast of Rhode Island. Most importantly, carbon emissions from the power sector are projected to continue to decline and hit levels not seen since 1992.

Strong leadership by forward-thinking governors, policymakers, and power company executives who recognize the imperative of lower-carbon generation and the promise of clean energy, powerful market forces intensifying the push to lower-carbon resources, and the critical federal regulatory overlay of the Clean Power Plan — which has made clear that unlimited carbon pollution is a thing of the past — have all combined to deepen a trend towards cleaner electricity production at this dynamic moment in time.

Even with any possible political maneuverings in Washington, D.C. to reverse clean energy and climate progress, it is clear that the transition to a low-carbon future is well under way.

States and power companies are surging ahead — and given the favorable economics of clean energy and the urgent need to reduce climate-destabilizing pollution it would be foolish to turn back.

  • More than 21 gigawatts of wind and solar power (utility-scale and rooftop) are projected to have been installed in 2016, accounting for 68 percent of new U.S. capacity additions. That’s according to analyses by FERCSNL EnergyEIA, and SEIA/GTM Research.
  • Some of the country’s oldest and least efficient power plants were scheduled to close in 2016, transitioning 5.3 gigawatts of capacity, in no small part due to increasingly favorable economics for low-carbon generation.
  • Since 2014, solar installation has created more jobs than oil and gas pipeline construction and crude petroleum and natural gas extraction combined. According to recent reports, there are now more than 400,000 jobs in renewable energy.

Together, these trends indicate the U.S. power sector is well-positioned to continue to reduce carbon pollution at a significant pace. And because of the favorable economics for low-carbon generation and the urgent need to protect against climate risks, hundreds of major corporations are on record supporting the Clean Power Plan and the achievement of emission reduction targets.

Power sector carbon emissions declined to 21 percent below 2005 levels in 2015, and are expected to drop again in 2016, meaning the power sector is already two-thirds of the way towards meeting its 2030 pollution reduction goals under the Clean Power Plan.

Notably, this de-carbonization of the electric sector has proceeded while the U.S economy has grown. In addition, recent analysis by the Brookings Institution shows that as of 2014, at least 33 individual states have also decoupled their economic growth from carbon pollution — continuing to grow their gross domestic product while significantly slowing their rate of greenhouse gas emissions.

Heading into 2017, companies from coast to coast are well-positioned to secure ongoing reductions in carbon emissions from their fleets – thereby helping the United States to achieve international commitments under the Paris Agreement, delivering greater value to customers and shareholders while ensuring state or municipal policy objectives will be achieved, and sharpening their ability to meet declining emissions limits in accordance with a federal regulatory framework.

Even the vast majority of states litigating against the Clean Power Plan can comply with the CPP targets by optimizing the carbon pollution benefits from already planned investments and compliance with existing state policies. The Clean Power Plan is crucial to making certain that states and companies take advantage of the opportunity to ensure the carbon reduction potential of these investments are fully realized, so they can in fact achieve these reasonable protections.

The shift to a lower-carbon future should continue, as power companies recognize both the imperative to reduce emissions and the benefits of moving in this direction despite changing political winds in Washington.

For example, shortly after the November election, a number of executives from historically coal-intensive companies convincingly reaffirmed their commitment to de-carbonization:

  • No matter who occupies the White House, “[coal is] not coming back,” said American Electric Power CEO Nick Akins. “We’re moving to a cleaner-energy economy and we’re still getting pressure from investors to reduce carbon emissions. I don’t see that changing.”
  • “It can't just be, ‘We're going to get rid of these regulations, and you guys can party until the next administration comes,’” Cloud Peak Energy Vice President Richard Reavey said. “There are serious global concerns about climate emissions. We have to recognize that's a political reality and work within that framework.”
  • “Markets are driving a lot of the behavior,” said Tom Williams, a spokesman for Duke Energy. “[W]e’ll continue to move toward a lower carbon energy mix.”
  • “We've always had a point of view at Southern that there's a reasonable trajectory in which to move the portfolio of the United States to a lower carbon future,” said Southern Company CEO Tom Fanning. “There's a way to transition the fleet now.” In a later interview, Fanning added: “It's clear that the courts have given the EPA the right to deal with carbon in a certain way.”
  • “Regardless of the outcome of the election,” said Frank PragerXcel Energy’s Vice President of Policy and Federal Affairs, “Xcel Energy will continue pursuing energy and environmental strategies that appeal to policymakers across the political spectrum because we are focused on renewable and other infrastructure projects that will reduce carbon dioxide emissions without increasing prices or sacrificing reliability.”

Acting on these commitments, many power companies are continuing to expand their renewable investments while phasing out high-carbon generation, putting them in a solid position to comply with robust carbon pollution regulations.

Here are a few recent highlights just from the last months:

  • At the end of December, Florida Power & Light (FPL) showed strong leadership when announcing plans to shut down the recently-acquired 250-megawatt Cedar Bay coal plant at the end of the year. “I'm very proud of our employees for proposing this innovative approach that's environmentally beneficial and saves customers millions of dollars,” said CEO Eric Silagy. FPL plans to replace the retired power with natural gas and solar — the company added 224 megawatts of solar capacity in 2016. FPL also noted that their system is now “cleaner today than the 2030 carbon emissions rate goal for Florida outlined by the Clean Power Plan,” while average residential bills are about 30 percent lower than the national average.
  • On December 30, Southern Company announced an agreement with Renewable Energy Systems America to develop 3,000 megawatts of renewable energy scheduled to come online between 2018 and 2020. The agreement comes as Southern Company continued to boost its renewable portfolio with the acquisition of 300 megawatts of wind power in late December, bringing its total to more than 4,000 megawatts of renewable generation added or announced since 2012.
  • Duke Energy acquired its first solar project in Colorado on December 8. The purchase advances Duke’s goal of owning more than 6,000 megawatts of renewable energy projects by 2020.

After the election, a number of power companies reiterated their commitment to reducing air pollution and meeting their obligations under the federal Clean Air Act by transitioning aging coal plants.

  • PNM Resources spokesman Pahl Shipley said the company has no change in plans for retiring two units at a New Mexico plant, totaling 837 megawatts of capacity, in 2017. PNM will replace the retired capacity with solar and nuclear power.
  • The Tennessee Valley Authority is moving forward with plans to retire two coal plants in 2017, as well as a third in 2018.
  • Colorado-based electric cooperative Tri-State Generation will move forward with plans to retire its 100-megawatt Nucla coal plant and Unit 1 of the Craig coal plant. “We are moving forward with retirement activities and developing a transition plan for the employees and communities,” said Tri-State spokesman Lee Boughey after the election.

These announcements follow one of the biggest clean energy leadership stories of 2016 – commitments by two midcontinent utilities, Xcel Energy and Berkshire Hathaway Energy, to go big on cost-effective investments in new wind resources.

  • This past year, Minnesota regulators approved a plan for Xcel Energy to construct as much as 1,800 megawatts of new wind power and 1,400 megawatts of solar in the state by 2030. Xcel also received approval to build a 600 megawatt wind farm in Colorado.
  • Berkshire subsidiary MidAmerican Energy secured approval to construct a massive 2,000 megawatt wind farm in Iowa that will be the “largest wind energy project in US history.” Said CEO Bill Fehrman: “Our customers want more renewable energy, and we couldn’t agree more.”

State policymakers have not stayed on the sidelines, either. 2016 sustained progress as states moved forward with commonsense efforts to reduce emissions of harmful air pollutants. And even with promises to roll back critical clean air, climate, and clean energy progress coming out of Washington, D.C., states made clear after the election that they will not be slowed down by potential federal backsliding:

  • On December 7, Illinois enacted a comprehensive new energy bill that will in part double the state’s energy efficiency portfolio and allow for 4,300 megawatts of new solar and wind power while providing for continued operation of zero-emission nuclear facilities. These measures are expected to reduce the state’s carbon emissions 56 percent by 2030.
  • On December 15, Michigan lawmakers approved a new bill to increase the state’s renewable portfolio standard to 15 percent by 2021, up from 10 percent. Republican Governor Rick Snyder touted the bill in a statement: “What we’re in is a huge transition in how we get our energy. We’ve got a lot of aging coal plants that are beyond their useful life, and it’s not worth investing in them anymore … We can transition to both natural gas and renewables and let the markets sort of define the balance between those two, so we’re moving away from an old energy source [where] we had to import all of this coal.”
  • Also in December, Washington Governor Jay Inslee proposed the state adopt a first-of-its-kind carbon tax of $25 per metric ton of carbon pollution. The proposal supplements the state’s innovative Clean Air Rule, adopted in September, which caps carbon emissions from individual polluters.
  • Nine states comprising the Regional Greenhouse Gas Initiative are engaged in a stakeholder process designed to establish new, more protective, standards for climate pollution.
  • In Oregon, regulators are evaluating options for a market-based mechanism that could link to the California-Quebec carbon market, releasing a partial draft report on November 21.
  • Governors such as Colorado’s John Hickenlooper continue to display strong leadership and a keen understanding of the imperative to move to a low-carbon future. After the election, Hickenlooper said he remains committed to fulfilling the goals of the Clean Power Plan, no matter what happens to the rule.
  • In Pennsylvania, a spokesman for Governor Tom Wolf’s Department of Environmental Protection (DEP) noted that: “Pennsylvania’s carbon footprint has been shrinking rapidly due to market based decisions being made in the state’s electric generating sector … It is likely that this trend will continue.” He added that the DEP “will continue to seek ways to continue addressing climate change.”
  • In California, Governor Jerry Brown mounted a vigorous defense of California’s climate leadership and the role the state will continue to play in setting the stage for ongoing progress and defending the important progress of the last eight years. “We’ve got the scientists, we’ve got the lawyers and we’re ready to fight. We’re ready to defend,” he said.

The momentum that power companies and states have generated towards achieving a clean energy future is powerful and encouraging.

Looking to 2017 and beyond, market trends are expected to continue to help facilitate de-carbonization of the electric sector, while federal and state policies must continue to provide certainty about the pace and depth of emissions reductions needed to address the threat of climate change. These policies will help companies plan clean energy investments in a way that maximizes benefits for consumers and facilitates optimal deployment of available resources.

The Clean Power Plan remains crucial to achieving these goals. Any disruption in the Clean Power Plan’s implementation could put long-overdue and readily achievable emission reductions at risk.

As we ring in the New Year, EDF will keep working with a diverse set of stakeholders across the country — including many state officials and power companies — to defend these critical environmental safeguards. At the same time, we will work vigorously to ensure that we achieve the reductions in carbon pollution envisioned by the program.

 

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EPA Responds to States, Provides Useful Information for Developing Cost-Effective Programs to Reduce Carbon Pollution

By Pam Kiely and Nicholas Bianco

Earlier today the U.S. Environmental Protection Agency (EPA) released several draft  documents designed to provide additional information for states and other stakeholders as they work together to reduce emissions of carbon pollution from power plants.

EPA notes that making these working drafts available:

[A]llows us to share our work to date and to respond to the states that have requested information prior to the end of the Administration.

The materials provide valuable insights that can be used by states currently implementing or considering developing their own programs for reducing carbon pollution, and can be leveraged as states evaluate ongoing state policy efforts to achieve pollution reductions under the Clean Power Plan.

The Clean Power Plan establishes America’s first ever limits on carbon pollution from power plants. Once implemented, it will provide essential protections for public health and the environment – saving up to 3,600 lives each year and delivering up to $54 billion in annual climate and health benefits – while also reducing electricity bills for American families.

These documents reflect extensive public input and engagement as well as decades of practical experience reducing air pollution at the state and federal level. They provide constructive information in response to direct requests for this type of material made by states who are interested in having the best information available as they undertake their own planning, public engagement, and regulatory initiatives.

A letter submitted to EPA by 14 states  requested “additional information and assistance” to help states “prudently plan for and implement a variety of state and federal obligations” because many states, as well as their stakeholders, understand that continuing to navigate the dynamic transition underway today in the power sector requires comprehensively evaluating and integrating state policy priorities with their best understanding of existing and future federal policy.

While the Supreme Court has stayed enforcement of the Clean Power Plan, EPA’s provision of helpful information in response to this letter is entirely consistent with actions taken by past Republican and Democratic Administrations to provide clarification and information on Clean Air Act rules that had been stayed by the courts.

States such as Pennsylvania and Colorado have recently underscored their commitment to continuing state-driven efforts to address climate change and greenhouse gas emissions, while more than a dozen power companies have continued to affirm that the transition to cleaner energy resources and progress toward de-carbonization of the electric sector is ongoing.

State officials and many companies keenly understand that prudent evaluation of the federal policy landscape, and ongoing deployment of no-regrets strategies and investments that well-position them to meet declining limits on carbon pollution, make sense. Additional information about options for Clean Power Plan implementation will only facilitate sensible alignment of state efforts already underway.

EPA released four draft documents today:

  1. Draft state models to help policymakers and regulators develop state-specific strategies to realize the benefits and achieve the emissions reduction targets in the Clean Power Plan. The draft models outline two highly flexible approaches for reducing carbon pollution in a cost-effective manner. By providing these models, EPA is helping to facilitate state innovation and the realization of pollution reductions aligned with state policies and prerogatives. These models provide greater clarity about practical implementation considerations so that states have the best information available about cost-effective opportunities to reduce climate pollution as they move ahead navigating, and helping to facilitate, the transition underway in the power sector.
  2. Draft EM&V Guidance for Demand-Side Energy Efficiency. EPA published draft guidance that states can use if they decide to implement demand-side energy efficiency projects. This guidance details methods for ensuring that project developers deliver high quality projects by providing options for monitoring and verification procedures that states can adopt if they are interested. Such support is extremely valuable, particularly when one considers that energy efficiency projects routinely deliver $2 in savings for Americans for every $1 invested, and in some cases up to $5 for every $1 invested.
  3. Draft Clean Power Plan Tracking Systems White Paper. EPA released draft materials designed to further assist states by providing information about how a tracking system could be designed to facilitate administration of the program. In so doing, EPA further demonstrates the relative ease with which a state can administer a flexible, cost-effective program to achieve carbon pollution reductions.
  4. Draft Technical Support Document: Leakage Requirement. If choosing to adopt a mass-based emission budget trading program instead of other program alternatives, this document  provides valuable information for addressing emissions leakage and securing the emissions reductions contemplated by the Best System of Emission Reduction. In addition to the streamlined approach for leakage mitigation that EPA finalized in the Clean Power Plan (using larger state budgets with the “new source complement” and including all fossil sources in the program), the working draft helpfully outlines a set of sample strategies that states could potentially use to guarantee the expected emissions outcome of their program, depending on particular state circumstances. The draft document notes the expectation that any strategy will include a process for performing periodic evaluations and look-backs that states and EPA could use to ensure the effectiveness of those measures. It also discusses the value of establishing mechanisms to address any shortcomings in performance. Together these measures underscore the importance of continuing to ensure on an ongoing basis that state program design secures the expected level of emissions reductions, and highlights the many options available to do so.

These draft materials build on decades of experience that EPA and states have in successfully implementing flexible compliance programs to reduce air pollution and drive innovation, and they show how these approaches can be applied for the Clean Power Plan. These same flexible frameworks have been used to reduce emissions under other Clean Air Act standards at a fraction of the cost that opposing parties have claimed –  and there is strong evidence that this will hold true for the Clean Power Plan as well (for examples see here, here, and here).

Climate pollution from the electricity sector has already fallen 21 percent below 2005 levels – which means America is already almost two-thirds of the way towards the 2030 Clean Power Plan emission targets. Emissions reductions and clean energy investments are widespread across states and power companies – even those that may be opposed to the Clean Power Plan itself. Analysis conducted for EDF by M.J. Bradley & Associates found that all 27 litigating states can comply with the Clean Power Plan just by leveraging already planned investments coupled with flexible compliance programs. Many of the power companies litigating against the Clean Power Plan are also well positioned to reach their targets, thanks to the increasingly low cost of lower- and zero-carbon generation.

While this progress is encouraging, the analyses also show that the Clean Power Plan has an essential role to play in ensuring that reasonable protections from climate pollution are realized. With the release of today’s draft documents, EPA is responding to the request by states, power companies, and other stakeholders to share lessons learned for flexible cost-effective implementation of the Clean Power Plan. These insights will prove to be valuable to states at all stages of planning for a low-carbon future.

 

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