{"id":14614,"date":"2016-09-21T13:07:18","date_gmt":"2016-09-21T18:07:18","guid":{"rendered":"http:\/\/blogs.edf.org\/climate411\/?p=14614"},"modified":"2016-09-21T13:07:18","modified_gmt":"2016-09-21T18:07:18","slug":"compliance-with-clean-power-plan-is-within-reach-even-for-states-opposing-it","status":"publish","type":"post","link":"https:\/\/blogs.edf.org\/climate411\/2016\/09\/21\/compliance-with-clean-power-plan-is-within-reach-even-for-states-opposing-it\/","title":{"rendered":"Compliance with Clean Power Plan is Within Reach — Even for States Opposing It"},"content":{"rendered":"

(Tom\u00e1s Carbonell<\/a>, EDF Director of Regulatory Policy and Senior Attorney, and Diane Munns<\/a>, EDF Senior Director of External Affairs, co-authored this post)<\/em><\/p>\n

In one week <\/strong>\u2013 on Tuesday, September 27th<\/sup> \u2013 the U.S. Court of Appeals for the D.C. Circuit will hear oral argument in legal challenges brought by the coal industry and its allies against the Clean Power Plan<\/a>.<\/p>\n

The Clean Power Plan establishes the nation\u2019s first ever climate pollution standards for the power sector, which is the largest source of climate pollution in the United States, and one of the largest sources in the world. (According to the U.S. Environmental Protection Agency<\/a>, the next largest sector \u2013 light-duty vehicles, which includes passenger cars and most pickup trucks \u2013 accounted for roughly one-half<\/strong> the emissions of the power sector in 2014.)\u00a0 As a result, the Clean Power Plan is one of the most important measures the United States has ever taken to combat the threat of climate change.<\/p>\n

The Clean Power Plan is expected to reduce carbon dioxide emissions from the power sector by 32 percent<\/strong> below 2005 levels by 2030, yielding up to $54 billion<\/strong> in annual climate and health benefits and saving up to 3,600 lives<\/strong> each year.<\/p>\n

The good news is that the United States\u2019 power sector is already rapidly reducing emissions by transitioning toward low cost, lower carbon sources of generation. In 2015, emissions were already 21 percent below<\/a> 2005 levels. That\u2019s almost two-thirds of the way toward the 2030 emission reduction target reflected in the Clean Power Plan. The rate of emission reduction we have seen over the last decade far exceeds the rate that would be required to achieve the Clean Power Plan targets by 2030. Meanwhile, analysts are projecting that the combination of falling prices for renewable energy and the extension of federal tax credits will drive a significant surge in new renewable development (see here<\/a>, here<\/a>, and here<\/a> for just a few examples).<\/p>\n

Even though powerful market forces are already driving dramatic progress in reducing climate pollution, opponents of the Clean Power Plan have argued in court that the plan represents a dramatic \u201crestructuring of nearly every State\u2019s electric grid\u201d and have also argued that compliance with the Clean Power Plan\u2019s emission reduction goals is \u201cimpossible.\u201d \u00a0(See<\/em> Opening Brief of Petitioners on Core Legal Issues, page 6, <\/em>West Virginia v. EPA, No. 15-1363, D.C. Cir. Apr. 22, 2016, and Opening Brief of Petitioners on Procedural and Record-Based Issues, page 12, West Virginia v. EPA, No. 15-1363, D.C. Cir. Apr. 22, 2016<\/em>)<\/p>\n

To evaluate these claims, EDF commissioned an analysis<\/a> to examine how far measures already planned by power companies could go towards helping achieve the Clean Power Plan emission targets in the states that have challenged these standards.<\/p>\n

What the analysis<\/a> found stands in stark contrast to allegations by the litigating states and power companies.<\/p>\n

About the Analysis<\/strong><\/p>\n

M.J. Bradley and Associates conducted the analysis using its publicly available Clean Power Plan Compliance Tool. The analysis drew on multiple, widely-used sources of industry-provided information on investments in new generation and planned retirements, and was based on policy scenarios and assumptions provided by EDF. The analysis<\/a> is cited in a court declaration filed by EDF clean energy expert Diane Munns<\/a>, and was recently featured in a Reuters article<\/a> titled \u201cMost states on track to meet emissions targets they call burden.\u201d<\/p>\n

Finding #1: All 27 litigating states can comply with the Clean Power Plan by leveraging planned investments coupled with flexible compliance programs<\/strong><\/p>\n

The analysis found that all<\/strong> 27 states opposing the Clean Power Plan could come into compliance with their emission reduction targets all the way through 2030, without making any<\/strong> additional investments beyond those that are already planned by power companies or required under existing state law. All state regulators need to do is take advantage of the inherent flexibility provided by\u00a0the Clean Power Plan and adopt flexible compliance programs that allow power plants to fully leverage the benefits of planned investments \u2013 such as by allowing companies to average across their sources or trade compliance credits across states lines.<\/p>\n

As Clean Air Act experts have noted, this compliance approach is familiar territory<\/a> under our nation\u2019s clean air laws. The Supreme Court recently upheld<\/a> this approach in reviewing EPA\u2019s Cross State Air Pollution Rule<\/a>, and many of the litigating states have already successfully adopted these types of emissions trading programs to achieve compliance with limits on soot and smog pollution from power plants.<\/p>\n

Finding #2:\u00a0 Even if they do not take full advantage of these program flexibilities, the vast majority of litigating states can comply with Clean Power Plan goals through 2030 through planned investments alone<\/strong><\/p>\n

The analysis<\/a> also considered very conservative scenarios where states do not take advantage of these program flexibilities, and each state comes into compliance solely through in-state investments and existing state policies \u2013 without engaging in trading of compliance instruments with any other states. Such constraints seem unlikely, given that most of the litigating states are already taking advantage of interstate trading in other Clean Air Act programs for the power sector and requested that interstate trading be an option under the Clean Power Plan.<\/p>\n

Even in these very conservative scenarios, as many as 21 of the 27 states challenging the Clean Power Plan could fully achieve their emission targets through the first three-year compliance period of the Clean Power Plan (the period from 2022-2024) by relying exclusively on existing generation, investments already planned within each state, and implementation of respective existing state policies. The study also found that as many as 18 of these states could comply all the way through 2030 as a result of these measures. Also, since this analysis was completed, Arkansas announced that it was already in compliance with the 2030 emissions targets. This suggests that at least 22 of the states could comply through 2024 as a result of planned investments, and that 19 states could comply through 2030.<\/p>\n

For the minority of states that were not found to meet their Clean Power Plan emission reduction targets through planned investments alone, this analysis indicates that very modest additional measures would be sufficient to close the gap. For example, it finds that all of the states could come into compliance in the first three-year compliance period merely by deploying cost-effective energy efficiency measures and developing new clean resources at a rate comparable to the average of their neighboring states.<\/p>\n

\"mjb-graphic\"<\/p>\n

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Finding #3:\u00a0 The Clean Power Plan has an essential role to play in reducing emissions from the power sector<\/strong><\/p>\n

While the analysis<\/a> shows that these states are well positioned for compliance, it also reaffirms the importance of the Clean Power Plan in delivering the needed reductions in climate pollution over the long term.<\/p>\n

This is because building new clean generation alone is not enough \u2013 it is also vital to ensure that the benefits of these investments are fully realized. By establishing nationwide emission limits through 2030, the Clean Power Plan will provide clear market and regulatory signals to power companies that encourage them to cost-effectively deploy their generation in a manner that reduces climate pollution. However, any delay or disruption in the implementation of the Clean Power Plan would interrupt those signals and put these eminently achievable reductions in climate pollution at risk.<\/p>\n

Power companies, states, and others agree: compliance is readily achievable<\/strong><\/p>\n

We aren\u2019t the only ones who have concluded that the Clean Power Plan targets are eminently reasonable. Our results are consistent with recent, independent economic analyses by the Nicholas Institute<\/a>, M.J. Bradley & Associates<\/a>, the Bipartisan Policy Center<\/a>, and others. All of these analyses predict very low compliance costs because favorable economics for lower and zero-carbon sources of electricity are expected to continue driving sustained investment in these resources even in the absence of the Clean Power Plan. As a result, states around the country are well positioned for compliance.<\/p>\n

Notably, states and power companies from across the country have themselves<\/strong> affirmed this very point:<\/p>\n