On April 25, 2024, EPA finalized the first-ever power plant pollution standards for the existing U.S. coal fleet and newly proposed gas plants, with most covered plants required to cut their pollution by 90 percent by 2032. Together, these rules are estimated to curb over 1.4 billion metric tons of carbon pollution and create $270 billion in climate benefits and $120 billion in public health benefits.
EPA is widely expected to propose updated carbon standards for new and existing power plants in the next few weeks. These rules are the Biden administration’s most significant opportunity to reduce carbon pollution in the wake of the Inflation Reduction Act (IRA) and drive towards the president’s climate and environmental justice commitments.
While the IRA was a historic achievement on climate, the law on its own is not enough to achieve President Biden’s commitment to a 50-52 percent reduction of economy-wide carbon pollution from 2005 levels by 2030. According to new modeling from the REPEAT project, the IRA is set to double the rate of U.S. decarbonization to help achieve a 37-41 percent reduction in carbon pollution by 2030—leaving a significant pollution gap between Biden’s commitments and his policy accomplishments so far.
To close the gap, the administration must take further action and leverage existing executive authorities. And power sector carbon standards are his single most impactful opportunity to reduce carbon pollution through executive action. Put simply: Biden will not be able to hit his climate targets without well-crafted, effective carbon standards for the power sector—EPA’s forthcoming proposal will be a cornerstone of the president’s climate legacy. The climate movement, and the voters within it that helped Biden secure the White House in 2020, will be watching.
The potential to reduce carbon pollution from the power sector using moderate and ambitious EPA power plant rules in combination with IRA tax credits. (From our paper with NRDC, Powering Toward 100 Percent Clean Power by 2035)
The power sector is at the heart of climate solutions. As other sectors like transportation and buildings decarbonize through electrification, it’s more important than ever to drive down climate pollution from the plants that produce the electricity that will be used to power more and more of our economy.
According to recent modeling from the Natural Resources Defense Council (NRDC), the IRA on its own could achieve a 66 percent reduction in power-sector carbon pollution from 2005 levels by the end of this decade, but the IRA in combination with strong carbon standards for power plants could cut that pollution to 77 percent below 2005 levels over the same time period—and reaching 80 percent clean power by 2030 is key to achieving the president’s electricity sector and economy-wide decarbonization targets. Essentially, these standards on their own could put the U.S. within striking distance of President Biden’s power sector pollution reduction targets and keep us on track to deliver on President Biden’s climate commitments to the American people and the global community.
In 2007, the Supreme Court required in Massachusetts v. EPA that EPA regulate greenhouse gasses if they were found to endanger Americans’ health and welfare—which the agency established in its 2009 endangerment finding. That means EPA is required to regulate carbon pollution under the Clean Air Act, including from power plants. Last year, in West Virginia v. EPA, the Supreme Court limited how EPA can exercise that authority, finding that the law did not give the power to regulate carbon in the power sector based on “generation shifting.” Basically, the EPA cannot dictate to industry that they must shift from polluting fossil fuel power plants to cleaner renewable energy sources. But the EPA still has broad authority to require carbon emissions reductions “within the fenceline” of power plants themselves, using abatement technologies that have been adequately demonstrated and found to be cost-reasonable.
In fact, EPA’s mandate to regulate carbon pollution in the power sector was reaffirmed by Congress after the Court’s ruling in West Virginia v. EPA, with a number of Clean Air Act amendments in the IRA that officially codified greenhouse gas emissions as a pollutant under the law, and directed the agency to set new power sector carbon pollution standards that take into account the IRA’s game changing investments and tax credits for power sector decarbonization. The IRA also provided EPA with $87 million to exercise this authority. Overall, the IRA enables EPA to set more ambitious standards at a lower cost and reinforces the agency’s authority to do so. The agency not only can regulate power sector carbon pollution—according to Congress, it must.
Effective power sector carbon standards are vital to achieve President Biden’s climate goals, but EPA will need to act fast to ensure these rules go into effect. The Biden administration is working with a razor thin margin to avoid a Congressional Review Act window that could leave their carbon standards vulnerable to repeal by a future Republican-controlled Congress. These critical rules have already faced multiple regulatory delays that have only increased the urgency to propose ambitious and legally sound standards as quickly as possible.
Climate voters helped President Biden secure the White House in 2020 based on his commitment to an ambitious whole-of-government response to the climate crisis. Passing the IRA was a historic climate victory, but recent setbacks like approving the Willow Project have sparked widespread protest and pushback from the same demographic that propelled the president to victory three years ago. Power sector carbon standards are an incredible opportunity to prove to this growing contingent of voters that he is the right choice to chart America’s climate future for four more years.
