carbon pollution standards

EPA's Clean Power Plan puts states in the driver's seat

The finalization today of EPA’s Clean Power Plan offers Americans a clear, realistic roadmap for addressing planet-warming emissions that threaten the environment and the U.S. economy.

Most importantly, it puts states in the driver’s seat to devise innovative strategies to reduce emissions efficiently and cost-effectively. Now it's time for states to work together with businesses and cities to craft the approaches that work best for them.

Climate change is a critical challenge, and the impacts will only grow more costly if we fail to act. Last year was the warmest on Earth since we started keeping records over a century ago. During the first half of this year, it got even hotter. Climate change impacts include more extreme heat, which can exacerbate drought and wildfires, more frequent and intense downpours that can lead to destructive floods, and rising sea levels that threaten coastal cities.

Many cities, states, and companies recognize climate risks. And many are taking steps to reduce greenhouse gas emissions.

New federal standards are already reducing heat-trapping emissions from the second-biggest source, transportation, by increasing the fuel economy of cars and trucks. The Clean Power Plan takes the next logical step by addressing the largest source: the electric power sector, responsible for nearly 40 percent of U.S. carbon dioxide emissions.

Carbon Pollution Standards

Carbon Pollution Standards

The U.S. Environmental Protection Agency (EPA) issued final rules in August 2015 to limit carbon pollution from existing and new power plants. Electric power generation accounts for 40 percent of U.S. carbon emissions, making it the largest source. 

Reducing power sector emissions is a key part of President Obama’s Climate Action Plan, which aims to reduce overall U.S. greenhouse gas emissions 17 percent below 2005 levels by 2020. In addition, the U.S. contribution to the upcoming international climate agreement in Paris sets an economy-wide target of reducing greenhouse gas emissions by 26-28 percent below 2005 levels by 2025.

Under the Clean Power Plan for existing power plants, each state has its own target (due to regional variation in generation mix and electricity consumption). Overall, the rule is designed to cut emissions 32 percent from 2005 emission levels by 2030.

EPA's “Carbon Pollution Standard for New Power Plants” finalizes a standard first proposed in March 2012 that was modified and proposed again in September 2013. States would apply the standards for new coal- and natural gas-fired plants (measured as tons of greenhouse gas emissions per megawatt-hour of elec­tricity produced) at each regulated plant.

Explore the issues and options involved in reducing carbon pollution from power plants through the following resources:

C2ES Resources

Additional Resources

 

Carbon Pollution Standards Map


In its final rule (Clean Power Plan) to reduce carbon dioxide emissions in the power sector, EPA has set a unique target emissions rate for each state to achieve by 2030. Targets are based on the “best system of emission reduction” (BSER), which use three “building blocks” or potential pathways to cost-effectively and efficiently reduce CO2 emissions:

  1. Make coal-fired power plants more efficient;
  2. Shift generation from existing fossil steam plants to existing natural gas combined cycle plants (NGCC) up to a maximum utilization of 75 percent; and
  3. Use more zero-emission renewable power, including onshore wind, utility-scale solar photovoltaic (PV) and concentrating solar power (CSP), geothermal and hydropower.

State Target Calculation Steps

To calculate a state’s target, EPA first determined a CO2 emissions baseline (using 2012 data) based on each state’s level of CO2 emissions from fossil-fired power plants divided by its total fossil-fired electricity generation (including coal steam plants, oil and natural gas steam plants and natural gas combined cycle plants). Next, the state level data was aggregated to the regional level (Eastern, Western and Texas Interconnections). Then, “emission performance rates” were established for years 2022-2030 for two subcategories of existing fossil-fired power plants (1) fossil steam (generally, coal-fired plants), and (2) natural gas combined cycle units, based on the capacity of each region to achieve reductions using the identified building blocks.

Finally, state target emission rates (pounds of CO2 per megawatt-hour of electricity generated) were calculated based on a weighted average of the states’ baseline fossil fuel mix (percentage of fossil steam and natural gas combined cycle plant generation) and the two emission performance rates (see sample calculation below).

In 2030, the emission performance rate for all fossil steam plants was determined to be 1,305 lb CO2/MWh, and the emission performance rate for all natural gas combined cycle plants was calculated to be 771 lb CO2/MWh. All state target emission rates in 2030 fall between these two values.

Sample calculation for Alabama

State target (weighted average) = (% fossil steam generation in 2012 x fossil steam plant rate in 2030) + (% natural gas combined cycle generation in 2012 x natural gas combined cycle plant rate in 2030)

In Alabama in 2012, total fossil generation was 46 percent from fossil steam generation and 54 percent from natural gas generation, therefore

Alabama state target CO2 emissions rate in 2030 (lbs CO2/MWh) = (0.46 * 1,305) + (0.54 * 771) = 1,018 lb CO2/MWh

Each state can meet its established target however it sees fit, and does not need to leverage each building block to the extent that EPA projects. The EPA has also converted state target emissions rates to a mass-based standard (tons of CO2 emitted per year) to better enable trading of carbon pollution credits.

EPA’s proposed carbon standard for power plants is stringent and flexible

The Obama Administration today took a major step toward reducing the carbon dioxide emissions that are impacting our climate. The Environmental Protection Agency (EPA) released its “Clean Power Plan,” which leverages existing authority in the Clean Air Act to propose carbon pollution standards for existing power plants, the largest single source of U.S. carbon emissions. The proposal would cut emissions in the power sector by 30 percent by 2030, based on 2005 levels. We reviewed the basics of the Clean Power Plan with four critical questions in mind:

1. Is the standard based on emission reductions outside the power plant fence line?

The short answer is “yes.” EPA cannot require states or power plant operators to take any specific measures, but it can set the emissions target stringent enough so that it would be challenging to achieve unless certain measures are taken. EPA is proposing state-specific targets based on the capacity of each state to leverage four “building blocks.” They are:

  1. Make fossil fuel power plants more efficient.
  2. Use low-emitting natural gas combined cycle plants more where excess capacity is available.
  3. Use more zero- and low-emitting power sources such as renewables and nuclear.
  4. Reduce electricity demand by using electricity more efficiently.

Although “outside-the-fence-line” measures are not specifically required under the proposal, states would be hard-pressed to meet their targets without using programs to reduce the demand for fossil electricity, by, for example, increasing energy efficiency and encouraging renewable energy.

Looking to Figure 1, EPA has chosen the System-level Option.

Figure 1: Scope of reduction requirements

What to watch in EPA’s power plant carbon emissions proposal

On June 2, the Environmental Protection Agency (EPA) is expected to release its proposal to cut carbon dioxide (CO2) emissions from existing power plants. This proposal is a key element of President Obama’s Climate Action Plan, and will be critical to reducing U.S emissions of CO2, the most common greenhouse gas contributing to climate change.

The proposed rule, being developed under EPA’s authority under Section 111(d) of the Clean Air Act, could be groundbreaking for at least two reasons. First, it has the potential to drive major reductions in the highest emitting sector in the United States – the power sector – which is responsible for nearly 40 percent of U.S. carbon emissions.  Second, EPA has indicated that the proposal will include a number of novel policy provisions to advance low-emitting generation and energy efficiency.

At C2ES, we’ll be looking for answers to four key questions as we read through EPA’s proposal. These questions are expanded upon in our new brief, Carbon Pollution Standards for Existing Power Plants: Key Challenges.

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