CLIMATEWIRE | The Biden administration will release four pollution rules Thursday that could largely remove coal from the U.S. power grid by the early 2030s.
EPA Administrator Michael Regan said the coordinated release of standards for carbon dioxide, mercury, wastewater and legacy pollution would give utilities and regulators clarity about the pollution controls power plants will need in the long run.
It's a strategy, Regan noted, that he previewed two years ago at an industry conference in Houston.
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“On that day, I committed to maintaining transparency and an open dialogue so that state and federal energy regulators, power companies and grid operators would have the information they needed to make long-term investments in the transition to a cleaner energy economy,” he told reporters in a Wednesday night briefing. “And today, I'm proud to announce that we're following through on that commitment.”
The four rules — which use Clean Air Act and Clean Water Act authorities — are legally separate. But they all involve compliance deadlines that kick in in the 2020s and 2030s — years when the power sector will face decisions about when to retire aging coal units and how to compensate for that lost generation.
They are the last major pieces of EPA's power sector strategy for President Joe Biden's first term — a regulatory push centered on coal-fired power. Three of the rules are focused on coal plants — cracking down on toxic coal waste near aging and former power plants, curbing the release of toxic heavy metals from coal plants into waterways and setting mercury emission limits for plants that burn a particularly high-polluting form of coal known as lignite.
EPA's carbon standard is a pillar of Biden's climate plan, setting limits on planet-warming pollution from future gas plants and existing coal-fired units. EPA has delayed standards for existing gas plants for a future rulemaking — and signaled that its focus in Biden's potential second term will be on natural gas generation.
The final rule, which Regan will debut at Howard University, a historically Black university in Washington, D.C., makes several changes from last year’s draft. But Regan said it would be “equally as stringent, if not more.”
Under the final rule, coal plants that plan to operate long-term will get two additional years to install carbon capture and storage systems relative to the proposal’s deadline of 2030. New combined-cycle natural gas plants that run frequently will also need to use CCS by 2032 — three years sooner than EPA originally proposed. And fossil fuel plants that aren't retrofitted with pollution controls must exit the grid by 2039 — rather than the proposed 2040.
The final rule also eliminates "clean" hydrogen as a benchmark technology for setting the natural gas pollution standards. And it applies the toughest standards to more gas plants, redefining "baseload" plants as those that run 40 percent of the time (rather than the proposed rule's 50 percent threshold).
EPA said the rule would slash heat-trapping emissions by 1.38 billion metric tons of carbon pollution through 2047 — the equivalent of taking 328 million gasoline-powered cars of the road.
Regan said Thursday’s joint release would allow utilities and regulators to pursue a “consolidated planning process” that would ensure that the “power sector has the information needed to prepare for the future with confidence.”
Utilities will be able to make informed investments, he said. And regulators and states will have ample time to plan for any power plant retirements and avoid supply and reliability problems.
'Proactive planning'
The power sector is the nation’s second-largest source of greenhouse gases, responsible for about a quarter of all U.S. emissions. It has slipped from first place in the last two decades as coal-fired power lost its dominance to cheaper natural gas.
But environmentalists say that if the U.S. is to meet Biden’s goal of a zero-carbon grid by 2035, the role gas plays must change too.
“These are very significant and important rules for the general transition of this sector,” Tim Profeta, EPA’s former power sector regulations lead, said in an interview.
Profeta, a senior fellow at Duke University’s Nicholas Institute for Energy, Environment & Sustainability, said EPA’s regulatory strategy creates a “glidepath” to allow utilities to opt to take plants offline “so they don't have to expend unnecessary capital to clean them up in a very short time horizon.”
But the rules also provide certainty that fossil fuels plants that are built now “are not going to become stranded assets for the lack of the ability to control that pollution in the future, but will actually be built with a plan to control it," he said.
There are currently 148 coal-fired power plants in the U.S. that aren’t slated for retirement by 2030, according to the Sierra Club. The U.S. Energy Information Administration estimated that EPA's proposed power plant carbon rule would result in 155 gigawatts of coal unit retirements not currently planned by 2032.
EIA has also estimated that 20 GW of natural gas is slated to be built in the coming years.
That generation could be impacted by Thursday's new climate rules. EPA will release analysis Thursday or in the coming days that will show whether it thinks the standards will spur utilities to change their resource plans.
The National Mining Association expects the rules’ impact on coal-fired generation to be dramatic and intentional.
“Today’s announcement is the culmination of the Biden administration’s yearslong plan to force the closure of well-operating coal plants — a plan that is completely at odds with America’s energy reality,” said Rich Nolan, the industry group’s CEO.
“As we look ahead, with grids already strained to their max, the repercussions of this reckless plan will be felt across the country by all Americans,” he said.
NMA released a white paper recently that said there was a “gap growing between the power supply the nation needs and what it will soon have,” and predicting that “shortages are imminent.”
The white paper pointed to ballooning power demand from the electrification of new sectors — like transportation — and the expansion of power data centers and crypto mining. Nolan said the rules expose the economy to a host of power supply and grid reliability risks.
But a senior administration official told reporters in Wednesday's briefing that EPA included new flexibilities in the final rule to ensure that it wouldn’t lead to supply disruptions.
That includes a provision for short-term supply emergencies that allows gas plants to operate at a less stringent emissions rate — allowing new gas units, for example, to run more and provide more power temporarily without having to meet tougher pollution standards.
“So, it essentially sort of holds units harmless when they're providing service to the grid during these defined emergencies,” the official said.
The final rule also allows states to keep online retiring power plants for an additional year if they can demonstrate the unit's retirement threatens grid reliability. The aim is to address concerns that fossil fueled power plants might exit the grid before their generation can be replaced.
Michelle Solomon, a senior policy analyst at Energy Innovation, said the long lead times EPA is providing for its rules should prevent supply shocks.
“What's happening right now is that because of the poor economics of coal, coal plants are retiring unexpectedly, and it's leaving grid operators, utilities, etc., kind of caught flat-footed without having planned for the new capacity and the new transmission needed to stabilize the grid in that area for when that coal plant retires,” she said. “So what we really see as missing right now is that proactive planning for these retirements that are going to be inevitably coming.”
Reprinted from E&E News with permission from POLITICO, LLC. Copyright 2024. E&E News provides essential news for energy and environment professionals.