Climate 411

Supreme Court Decision Leaves Greenhouse Gas Permit Requirements for Large Industrial Polluters in Place

By Pamela Campos / Published: June 23, 2014

(This post was written by EDF Senior Attorneys Pamela Campos and Peter Zalzal)

Source: Daderot (Own work) [Public domain], via Wikimedia Commons

This morning the Supreme Court issued a 7-to-2 decision confirming that the U.S. Environmental Protection Agency (EPA) may continue to require large industrial sources of climate pollution to use the best available control technology when building or rebuilding plants.  A 5-to-4 majority also determined that such pre-construction permits would not be required for the many smaller sources that EPA had concluded would pose significant administrative problems.

Today’s decision is good news for all of us exposed to the health and climate impacts of new industrial plants. It also leaves the vast majority of already-issued greenhouse gas permits untouched.

While there are a handful of permits potentially impacted by today’s decision, an EPA database shows that the vast majority of permits issued between 2011 and 2013 cover both greenhouse gases and other pollutants.

A separate EPA update from March 2014 shows that the large majority of permits issued are for exactly the type of plants Congress, and the Supreme Court, had in mind – large industrial sources such as power plants, oil and gas-related plants, chemical plants, and cement plants.

By design, EPA’s tailoring rule applied only to the largest sources of air pollution. For the first six months of implementation, the rule explicitly applied only to sources emitting large amounts of both greenhouse gases and other air pollutants. In the last 3 years, permits have been required only for the largest sources of greenhouse gas pollutants – the types of sources that also emit large amounts of non-greenhouse gas pollutants. (See slides 26 and 27 of this EPA presentation)

Since 2011, more than 160 new and modified large industrial sources have incorporated the best available technologies for limiting greenhouse gases.

As a result, we have new and updated power plants in California that have improved efficiency by up to 88 percent, gas plants in Maryland that are using high-efficiency combined cycle turbines that reduce facility costs, and cement kilns that have cut greenhouse gas pollution by 40 percent while reducing energy costs. (See pages 38 and 39 of this legal brief filed by the states)

Today’s decision means that the Clean Air Act will continue to play a role in advancing use of efficient, cost-effective technologies that cut both global and local air pollution from large polluters. And that’s good news for all of us.

Posted in EPA litgation, Greenhouse Gas Emissions, News, Policy / Comments are closed

The Clean Power Plan: Protecting Health and the Climate While Ensuring Electric Reliability

By Cheryl Roberto / Published: June 20, 2014

(This post is by EDF Associate Vice President for Clean Energy Cheryl Roberto, with EDF Senior Director of Clean Energy Collaboration Diane Munns and legal fellow Peter Heisler)

Source: Chris J Dixon via Wikimedia Commons

The U.S. Environmental Protection Agency’s (EPA) new Clean Power Plan will empower states to design customized, cost-effective programs to reduce climate-destabilizing pollution while ensuring continued electric system reliability.

States will be able to deploy flexible compliance mechanisms such as:

  • renewable energy
  • demand-side energy efficiency
  • shifts in utilization away from higher-emitting and towards lower-emitting generation sources
  • measures at specific plants to secure reductions in carbon pollution

And states will be able to do all of this while designing their compliance plans to make sure that generation resources are fully sufficient to ensure reliability.

The “bottom line,” according to Analysis Group, is that “there is no reasonable basis to anticipate that EPA’s guidance, the states’ [plans] and the electric industry’s compliance with them will create reliability problems for the power system.”  On the contrary, “[t]o date, implementation of new environmental rules has not produced reliability problems”—despite industry’s history of crying wolf.

Case in point: before Congress enacted the Acid Rain Program in 1990, electricity producers warned that it could “increase the cost, risk the reliability of electric service, [and] disrupt the long-range planning of utilities.”  Yet they quickly found solutions that reduced pollution more than required, and at much lower cost than expected — taking advantage of the program’s flexible trading system to maximize the results of conventional pollution controls.

With the Clean Power Plan, states would not only be able to implement market-based mechanisms, but also to deploy cost-effective solutions like energy efficiency, renewable energy, and shifts in utilization to lower-emitting plants.

Yet electricity producers are at it again.

American Electric Power (AEP) CEO Nick Akins recently said that a shortage of natural gas and above-average levels of coal generation during this winter’s polar vortex should raise a “red flag” about limits on carbon pollution from power plants. (See SNL Energy, April 7, 2014)  But this is in fact a red herring.

Here are some key facts about the 2014 cold weather event referred to as the polar vortex:

  • In the PJM Interconnection, unexpected outages at coal-fired power plants with operational problems were more to blame for the scarcity of power than outages of gas plants or a shortage of natural gas.
  • Renewable energy and energy efficiency are key resources during periods of high demand. ISO New England said that renewable energy was an “important part of our energy mix” during the polar vortex, and that distributed generation resources “performed well and were a valuable part of maintaining reliability during the winter season.”

And new studies demonstrate that incorporating renewable energy and energy efficiency into the electric system to reduce carbon pollution is consistent with maintaining reliability.

For example, PJM’s Renewable Integration Study found that the system can accommodate up to 30 percent wind and solar generation without significant issues.

The real threat to reliability is inaction. The Third National Climate Assessment predicts significant impacts on energy supply and use if we do not curb carbon emissions. Year-round net electricity use will increase due to burgeoning peak loads in the summer, water scarcity will hamper various kinds of generation, and sea level rise and extreme storm surge events will inundate coastal power plants and energy infrastructure.

The choice is clear.

EPA’s Clean Power Plan will protect public health and reduce dangerous carbon emissions. Through the Carbon Pollution Standards for new and existing power plants, we can achieve significant reductions in climate-destabilizing emissions while sustaining access to affordable, dependable electricity.

Posted in Clean Power Plan, Energy / Read 1 Response

America’s coal-producing states weigh their options

By Jim Marston / Published: June 19, 2014
A coal train rolls through a town in West Virginia, which produces more coal than any other state except for Wyoming.

Nobody was surprised to hear political foes of President Obama and leaders from several coal-dependent states blast EPA’s proposal to limit carbon pollution from America’s power plants.

The Clean Power Plan, released June 2, represents a big change in the way America will generate and use energy in the coming decades. We understand: Big changes are scary.

So it’s interesting to ponder which political leaders in states dependent on coal-fired power will, in the end, seize this historic opportunity.

Who will use the flexible policy tools offered in the Clean Power Plan to diversify their energy economies and unleash innovation to help their states grow? Who will show political courage?

Clean(-er) power for Texas

Just imagine if a state like Texas, my home state, used the plan to fully leverage its robust natural gas, wind and solar resources. It would be a game changer.

Texas power plants, and the state as a whole, continue to lead the nation in carbon dioxide emissions.

Texas also leads the nation in producing more than 12,000 megawatts (MW) of wind energy. That’s impressive.

According to data from the National Renewable Energy Laboratory, however, this represents less than 1 percent of Texas’ onshore wind potential.

What’s more, Texas is at the top in solar potential, yet solar energy in Texas lags far behind wind at 213 MW of installed capacity. This spells tremendous opportunity.

So does Texas’ natural gas industry, which may be the biggest winner under EPA’s plan. The American Natural Gas Association predicts the new emission standards will increase natural gas demand by 45 percent – much of which will be produced by Texas with little impact to electricity prices.

In fact, the flexibility of EPA’s proposed plan offers Texas and other states dozens of ways to comply while improving public health and the state economy.

West Virginia: Rich in energy

Take West Virginia, where king coal has reigned for decades. It’s among several coal-producing states that got a break by the Clean Power Plan.

West Virginia only needs to cut emissions from power plants by 20 percent by 2030, when the overall target for all 491 plants nationwide is 30 percent, and some states face cuts of 40 percent or more.

This has not kept West Virginia from threatening to sue the EPA over the rules, even as several of the state’s utilities said they’re already well on their way to meeting EPA’s rules.

But amid such noise there’s also optimism. The West Virginia University College of Law has already teamed up with a consulting firm to analyze EPA’s plan and to develop strategies some West Virginians hope will help the state transition to a cleaner future.

“West Virginia has an abundance of energy resources – including coal, natural gas, biomass, wind, solar and energy efficiency,” noted James Van Nostrand, director of the university’s Center for Energy and Sustainable Development.

Finding the right mix, he said, will be the main challenge.

Meanwhile, other states enjoy a head start thanks to politically courageous decisions taken years ago. Colorado, a purple state and the seventh largest coal-producer in the country, is one such state.

Colorado blasts ahead

Voters in the Rocky Mountain State approved a renewable energy standard a decade ago and in 2010, the legislature adopted the “Clean Air, Clean Jobs Act.” It requires utility companies to get 20 percent of their energy from cleaner sources by 2020, speeding up the retirement of aging coal-fired plants.

Then in late 2013, Colorado became the first state in the nation to propose new methane limits for its oil and gas operations.

By reining in this highly potent greenhouse gas, and thanks to the steps it took over the past decade, Colorado may already be ahead of the curve when it comes to meeting EPA’s proposed standards.

And what does all this energy progress cost? According to one Colorado utility, Xcel Energy, the Clean Air, Clean Jobs Act will cost the company $1 billion, with an annual rate impact of only about 2 percent over the next decade.

Yet the benefits to Coloradans are significant: $590 million in averted health costs and 1,500 construction jobs.

My guess is that not even in states such as Texas or West Virginia will they be able to deny for long the billions in cost-savings, millions in health benefits, and hundreds of new jobs that the Clean Power Plan promises.

Posted in Clean Power Plan, Energy, Greenhouse Gas Emissions, Policy / Read 2 Responses

EPA’s Authority to Limit Carbon Pollution from Power Plants Is Well Established and Widely Recognized

By Megan Ceronsky / Published: June 17, 2014

Gavel_iStock000003633182Medium(This post was written by EDF attorney Megan Ceronsky and legal fellow Peter Heisler)

The bedrock legal authority underlying the U.S. Environmental Protection Agency’s (EPA) Clean Power Plan is broadly recognized — by our nation’s highest court, states, power companies, academic experts and the EPA General Counsel serving during the President George H.W. Bush administration.

Our recent Climate 411 post chronicles the Supreme Court’s decisions affirming EPA’s authority to address carbon pollution from power plants under section 111 of the Clean Air Act.

In Massachusetts v. EPA (2007), the Court held that carbon dioxide is a pollutant under the Clean Air Act.  Then, in AEP v. Connecticut (2011), the Court explicitly recognized EPA’s authority to limit emissions of carbon dioxide from power plants pursuant to section 111, and acknowledged the agency’s ongoing efforts to do so.

Even before AEP was decided, however, legal researchers and academics had identified section 111 as a promising avenue for regulating carbon pollution from power plants and industrial facilities:

  • A 2009 report by the Congressional Research Service found that “Section 111 appears to provide a strong basis for EPA to establish a traditional regulatory approach to controlling greenhouse gas emissions from large stationary sources.”
  • A 2010 paper by Duke University’s Nicholas Institute for Environmental Policy Solutions observed that “[S]ection 111 appears to provide the EPA with the best means to create a system that … implements a cost-effective program that delivers meaningful emissions reductions, is consistent with both the statutory language of the Act and legal precedent, and is politically viable.”
  • A 2011 survey of the academic community found “widespread agreement” that “[section] 111 authorizes the use of many types of flexible approaches” to regulating carbon pollution.

Indeed, states, power companies, and other stakeholders have all recently analyzed and supported EPA’s authority to limit carbon pollution from power plants:

  • Kentucky recognized EPA’s role in setting the benchmark that states will have to meet under section 111.
  • Pennsylvania said that section 111 was the “most appropriate” provision for regulating carbon dioxide emissions from power plants.
  • The nine Northeastern and Mid-Atlantic states participating in the Regional Greenhouse Gas Initiative “recommend[ed] that EPA use its authority under section 111 of the Clean Air Act to ensure significant overall reductions in carbon emissions.”
  • Fifteen states from across the country agreed that “EPA needs to seize [the] opportunity [for pollution reduction] because Section 111(d) standards are to be based on the ‘best system of emission reduction,’” including energy efficiency and renewable energy.
  • The Clean Energy Group, whose members include some of the largest generators of electricity in the country, noted that “EPA has significant discretion under section 111(d) in determining both the appropriate level of the standards for existing power plants, as well as the form of the regulations.”

Environmental law experts have also analyzed and endorsed EPA’s authority to regulate carbon pollution from power plants:

  • UCLA Law Professor Ann Carlson said “[I]t is important to be clear here: the President is required to issue the rules, required by law and by the interpretation of the law by the highest Court in the land.”
  • Harvard Professor Jody Freeman called critics’ claims to the contrary “weak,” explaining that “[t]he record clearly shows that Congress intended to ensure that harmful pollutants from existing power plants could not entirely escape regulation. These emissions qualify for regulation under 111(d) because they are not covered elsewhere in the law and account for nearly 40 percent of the nation’s total emissions of carbon dioxide, the principal driver of global warming.”
  • E. Donald Elliott, EPA General Counsel under President George H.W. Bush, noted that “the Supreme Court and other courts have upheld EPA’s authority to address this issue,” and “[a] system-wide approach provides needed flexibility and reduces costs, as well as encouraging investment in lower-emitting generation. EPA has wisely left the states a lot of discretion rather than mandating specific measures as some had wanted…”
  • Carol Browner, EPA Administrator during the Clinton administration, wrote that “EPA has authority under the 1990 Clean Air Act, an authority affirmed by the U.S. Supreme Court, to set these public health protections against carbon pollution.”

Finally, Leon G. Billings, who was the principal staff author of the Clean Air Act of 1970, shared his personal knowledge of the statute:

Critics of the move say that President Obama is making an end run around Congress, stretching the law to achieve by executive action what he could not accomplish through the legislative branch … This is flat wrong. More than four decades ago, Congress expressed its clear desire to regulate pollution from power plants, in the form of the Clean Air Act. I know, because I worked on the legislation, including the key part of the act — Section 111 — that the Obama administration is using to justify its move.

The legal community broadly recognizes EPA’s authority and obligation to address carbon pollution emitted by power plants. This is perhaps unsurprising, as all these statements simply echo what the Supreme Court has already held — that EPA’s efforts to reduce carbon pollution from power plants are firmly grounded in the law.

Posted in Clean Air Act, Clean Power Plan, EPA litgation / Read 3 Responses

The cheapest way to cut climate pollution? Energy efficiency

By EDF Blogs / Published: June 16, 2014

This blog post was co-authored by Lauren Navarro, California Senior Manager, Clean Energy and Kate Zerrenner, an EDF project manager and expert on energy efficiency and climate change.

On June 2, the U.S. Environmental Protection Agency made a historic announcement that will change how we make, move and use electricity for generations to come.

For the first time in history, the government proposed limits on the amount of carbon pollution American fossil-fueled power plants are allowed to spew into the atmosphere.

There are two clear winners to comply with the plan while maintaining commitment to electric reliability and affordability: energy efficiency and demand response.

We’re already seeing pushback from some of our nation’s big polluter states, such as West Virginia and Texas. But the truth is that while the proposed limits on carbon are strong, they’re also flexible.

In fact, the EPA has laid out a whole menu of options in its Clean Power Plan – from power plant upgrades, to switching from coal to natural gas and adopting more renewable energy resources. States can choose from these and other strategies as they develop their own plans to meet the new standards.

That said, there are two clear winners on the EPA’s menu that offer low-cost options for states that seek to comply with the plan while maintaining their commitment to electric reliability and affordability: energy efficiency and demand response.

Energy efficiency our lowest-hanging fruit

Simply saving energy is the most cost-effective way to reduce demand and carbon pollution from power plants. The cheapest, cleanest and most reliable electricity, after all, is the electricity we don’t use.

The benefits of energy efficiency are vast. It helps people and businesses save money, it boosts job creation (as many as 274,000, one source estimates), and it reduces harmful power plant pollution.

From a utility perspective, energy efficiency improves the reliability of our electric grid and lowers costs for infrastructure maintenance.

Plus, in states such as Texas and California, which face extreme drought, energy efficiency can save scarce water sources. Remember that coal-fired power plants are thirstyand less water is consumed when these plants are used less (or not at all).

Half of the states already have mandatory energy-efficiency targets, so we have the knowledge and experience across the country to advance this undeniably beneficial resource.

Same as taking all cars off road

McKinsey & Co. estimates that by 2020, the United States could reduce its annual energy consumption by 23 percent by adopting energy-efficiency measures. This could save us more than $1 trillion dollars and cut greenhouse gas emissions by more than a gigaton—the equivalent of taking the entire U.S. fleet of passenger vehicles and light trucks off the road.

That’s why Environmental Defense Fund is working with policymakers, investors and utilities throughout the country to understand the full benefits of energy efficiency, and to explore paths for implementation, for when they’re crafting state plans under EPA’s new Clean Power Plan.

Demand response: everyone wins

Demand response is another way to introduce greater efficiency into the nation’s electricity system and help reduce carbon emissions. It’s an invaluable tool that can help conserve electricity when supplies run thin, and to bring more clean energy onto the grid.

On a hot summer day, for example, when electricity demand is high, utilities can ask permission of select customers to lower their thermostats a couple of degrees. In exchange, these customers receive credit on their next electricity bill.

It also helps utility companies better manage stress on the electric grid and it can help them integrate wind, solar and other renewables to replace aging coal-fired power plants.

Demand response relies on people, not power plants, to meet energy demand and reduce carbon pollution from our electricity sector.

Proven strategies

In Southern California, for example, they’re about to replace a large chunk of electric capacity – at least 550 megawatts – from the recently closed San Onofre Nuclear Generation Station with renewable energy, energy storage – and demand response. This will help minimize a need for gas-fired plants and other polluting facilities that might replace the nuclear plant.

Best of all, demand response is more affordable than building new power plants. In fact, if just 50 percent of Southern California Edison’s customers participated in time-of-use rates – a type of demand response program – energy demand would plummet so much that 66 percent of San Onofre’s former generating capacity would no longer be needed.

As a bonus, customers across the territory would also collectively see cost savings of $357 million, a 15-percent decrease.

As a result of smart decisions such as the one involving the San Onofre plant, California’s utility sector’s greenhouse gas emissions have and will continue to decline. This proves that demand response can and should be a core tenet in the nation’s push to diversify its energy mix and cut pollution in order to usher in a clean, sustainable and healthy future.

As EPA Administrator Gina McCarthy noted last week, these clean energy solutions are not new ideas. They’re based on proven technologies and approaches that “are already part of the ongoing story of energy progress in America.”

“We’re not doing cutting-edge work here, folks,” she said. “We are just opening the door to cutting-edge.”

This post first appeared on EDF Voices

Posted in Clean Power Plan, Energy, Greenhouse Gas Emissions, Policy / Read 3 Responses

Saving Billions While Cutting Climate Pollution

By Jason Mathers / Published: June 12, 2014

More fuel efficient, lower emission heavy trucks are good for business, good for consumers, and good for combating climate change. By deploying existing and emerging technologies to improve truck efficiency, the U.S. can save billions in fuel expenses while cutting harmful climate pollutions by millions of tons.

EDF is calling on the Obama Administration to set new fuel efficiency and greenhouse gas standards for heavy trucks that cut fuel consumption by 40 percent compared to 2010 levels. These standards would apply for freight trucks and heavy-duty work trucks, such as box delivery trucks, bucket trucks, beverage delivery trucks and refuse trucks.

Analysis by leading environmental and energy efficiency advocates, including EDF, demonstrates that bold heavy truck standards are technically feasible and will be effective in cutting oil consumption and climate pollution.

Strong standards will be good for American business and consumers too.

EDF and Ceres examined how strong standards would affect the cost of moving freight by trucks. The results are unequivocal — strong standards will save companies money.

For example, an owner of a new tractor-trailer unit stands to save between $21,000  and $36,000 during the first year the truck is in service.

By 2030, the combination of both phases of standards will cut fuel use by 1.4 million barrels per day and reduce carbon pollution by 270 million metric tons, compared to the fuel use and emissions that would occur without fuel efficiency improvements.

Companies stand to save nearly $8 billion dollars in 2030 too, as the cost-per-mile to move freight will decrease by $0.07 a mile as a result of the second phase rules alone.

By 2040, these savings could grow to $25 billion annually, as the net effect of the second phase of the standard alone could be to reduce the per-mile cost of moving freight by 21 cents.

Our finding of significant financial benefits of strong fuel efficiency and GHG standards is consistent in magnitude with previous analysis. A recent report by the Consumer Federation of America looked at similar Phase 2 standards and found net savings of $250 to consumers, rising to $400 per household in 2035 as fuel prices and transportation services increase.

With such savings at hand, a natural question is why do we need new standards in the first place? We need new standards because well-designed federal standards foster the innovation necessary to bring more efficient and lower emitting trucks to market.

Strong standards break down barriers that keep technologies from moving from the test track to the assembly line.

Manufacturers need to be confident in market demand in order to develop and launch efficiency improvements. Strong standards give them the certainty they need.

Fleets are often weary of investing in advanced technologies; as such capital investments could put them at a disadvantage if fuel prices drop suddenly, like they did in 2008. For-hire trucking fleets also directly pass on a large percentage of their fuel bill through fuel surcharges to their customers, thus distorting the economic incentive to invest in efficiency.

Manufacturers and fleets can benefit significantly from strong standards. As the EDF analysis demonstrates, manufacturers will have a market for more valuable equipment; while fleets will achieve significant overall savings.

In fact, this is just the type of impact we are seeing from the first phase of heavy trucks standards, which went into effect at the start of this year. Fleets and Manufacturers are praising the rule and new, cost-effect offerings have come onto the market.

Moving forward on strong heavy-truck efficiency and emissions standards is a step that our country needs to take.

Posted in Cars and Pollution, News / Comments are closed