The Center for Climate and Energy Solutions seeks to inform the design and implementation of federal policies that will significantly reduce greenhouse gas emissions. Drawing from its extensive peer-reviewed published works, in-house policy analyses, and tracking of current legislative proposals, the Center provides research, analysis, and recommendations to policymakers in Congress and the Executive Branch. Read More
The U.S. Department of Energy (DOE) oversees federal efforts to advance the deployment carbon capture and storage (CCS) technology. In addition to working on the research and development of CCS component technologies, DOE has provided financial support to multiple commercial-scale CCS projects in the power and industrial sectors. This brief examines DOE’s support for CCS through the American Recovery and Reinvestment Act of 2009 and through its annual budget.
This page discusses EPA's final standards for new power plants issued on August 3rd, 2015. For a discussion of the standards for existing power plants click here.
The U.S. Environmental Protection Agency (EPA) released a final rule to limit greenhouse gas emissions from new power plants on August 3, 2015. The final “Carbon Pollution Standard for New Power Plants” replaces earlier proposals from September 2013 and March 2012. It would establish New Source Performance Standards (NSPS) under the Clean Air Act to limit emissions of carbon dioxide (CO2) from coal- and natural gas-fired power plants. C2ES submitted public comments in response to EPA's proposal for new power plants from September 2013, which can be found here. EPA also simultaneously released a final rule to limit carbon emissions from existing power plants.
How would the standards work?
New Source Performance Standards set limits on emissions based on EPA’s assessment of available technologies. As with many other Clean Air Act programs, EPA establishes a standard for a given category of facility, which state environmental agencies then translate into requirements for individual facilities.
EPA’s final "Carbon Pollution Standard for New Power Plants" was developed under Section 111(b) of the Clean Air Act. Section 111(b) calls for a standard that "reflects the degree of emissions limitation achievable through the application of the best system of emissions reduction which (taking into account the cost of achieving such reduction and any non-air quality health and environmental impact and energy requirements) the Administrator determines has been adequately demonstrated." The emissions limit must take the form of a standard – in the case of power plants, maximum allowable CO2 emissions per unit of electricity – and may not prescribe a particular technology.
The Act ostensibly requires EPA to review the technological options available and, if appropriate, establish a new standard every eight years. In practice, standards have typically remained unexamined and unchanged for much longer than eight years, often because of resource constraints at EPA.
What does the standard require?
The final rule sets separate standards for new power plants fueled by natural gas and coal. New natural gas power plants can emit no more than 1,000 pounds (lbs) of carbon dioxide per megawatt-hour (MWh) of electricity produced, which is achievable with the latest combined cycle technology.
New coal power plants can emit no more than 1,400 lbs CO2/MWh, which almost certainly requires the use of carbon capture and storage (CCS) technology.
In the power sector, CCS is in use at a commercial-scale power plant in Saskatchewan, Canada, and will be employed at two commercial-scale power projects under construction in Kemper County, Mississippi, and in Thompsons, Texas. CCS technology is also in place in several industrial facilities, some of which generate as much carbon dioxide as a commercial-scale power plant.
How is this different from the standard EPA proposed in September 2013 or March 2012?
Similar to EPA’s earlier proposals, the final rule requires almost all natural gas power plants to meet an emissions standard of 1,000 lbs CO2/MWh.
In contrast to its proposed rule from September 2013, the final rule requires new coal-fired power plants to meet a less stringent emissions standard equal to 1,400 lbs CO2/MWh from the beginning of the power plant’s lifetime.
Under its proposal from September 2013, EPA would have required new coal power plants to meet more stringent standards with CCS, but a power plant could choose from two different compliance options. New coal plants could either emit less than 1,100 lbs CO2/MWh upon the beginning of operations or an average of 1,000 to 1,050 lbs CO2/MWh within the first seven years of operations.
In March 2012, EPA’s first proposal for limiting carbon emissions from new power plants would have subjected all new power plants to a uniform standard: 1,000 lbs CO2/MWh. Many of the public comments received by EPA on its initial proposal objected to the unprecedented use of a single standard for both coal- and natural gas-fired plants. EPA responded in its proposal from September 2013 by including a separate standard for each fuel.
What are the costs associated with the final rule?
EPA expects this standard to have negligible costs through 2022 (the intended time horizon of the standard), since very few new coal plants are planned, even without the proposed standard, and since developers of new natural gas plants should see minimal, if any, additional costs.
If a developer chooses to build a new coal plant, the proposed standards could add considerable costs to the project because it will have to employ CCS technology. Since CCS technology is just reaching commercial maturity for power plant applications, its costs are still relatively high. However, as with any new technology, costs will come down as developers gain experience and new innovations are made.
What effect is this proposal expected to have on carbon dioxide emissions?
In the near future, the final rule is expected to have very little impact on emissions because so few new coal plants would likely be built even without the standard. Nearly all new fossil-fuel power plants in the planning stages will be fueled by natural gas, using generation technology that complies with EPA’s final standards without any alterations. Power plant developers already have strong incentive to use the most efficient technology to maximize the amount of electricity that can be generated from each unit of fuel.
If a developer chooses to build a new coal plant, the requirement that the plant install CCS technology will drastically reduce its emissions. Increased deployment of CCS technology at power plants will very likely drive CCS costs down and make it a more viable option at other new coal plants. Through experience and innovation, CCS costs may come down enough to be viable on new natural gas power plants, or as retrofits on existing coal plants, to reduce carbon dioxide emissions from the power sector even further.
What can power plants do to reduce emissions?
New natural gas plants can reach the final CO2 standard by employing efficient generation technology. In older steam turbine plants, natural gas is combusted to heat water, which creates steam to turn a turbine and generate electricity. These plants have thermal efficiencies of 30-35 percent, meaning about one third of the chemical energy stored in natural gas is converted to electricity. In contrast, new combined cycle combustion turbines more effectively take advantage of the energy in natural gas to operate with a thermal efficiency above 60 percent.
New coal plants, on the other hand, cannot achieve the final standard through efficiency alone. The most efficient type of coal plants, using ultra-supercritical boilers or integrated gasification combined cycle technology, can currently achieve a CO2 emission rate of around 1,700 lbs/MWh.
Thus, new coal plants can only meet a standard of 1,400 lbs CO2/MWh through the use of CCS, which can capture a significant portion of a power plant's potential emissions. CCS is a multi-stage process in which potential CO2 emissions are captured from a power plant instead of vented into the atmosphere. Captured CO2 is transported via pipeline and injected into an underground geological formation for permanent storage. EPA has established certain regulatory requirements for demonstrating the permanent underground storage of CO2. Certain proposed CCS power plants are aiming to capture nearly 90 percent of potential emissions, which translates into an emissions rate of potentially less than 500 lbs CO2/MWh.
If new coal plants must use carbon capture and storage technology, what will that mean for the future of coal? How far along is CCS technology?
Even if EPA were not moving forward with this standard, very few new coal plants would likely be built, in large part because of the availability of affordable natural gas. The Energy Information Administration lists only four potential coal plants between now and 2018, compared with more than 200 expected natural gas plants.
Today, there are 13 active commercial-scale CCS projects at industrial plants around the world (eight of them in the United States). The world’s first commercial-scale CCS power plant – the Boundary Dam Power Station in Saskatchewan, Canada – has been in operation since late 2014. Two additional commercial-scale power plants with CCS are under construction. Southern Company's Kemper County Energy Facility in Mississippi is expected to come online in late 2015 or early 2016, while NRG Energy's Petra Nova project in Texas is expected to come online in 2017. All three projects are coal-fired.
Approximately 50 additional commercial-scale CCS projects in the power and industrial sectors are in various stages of development around the world. Learn more about the status of CCS technology here.
How would existing state policies, such as the Regional Greenhouse Gas Initiative, be affected?
The final rule for new power plants would likely be layered on top of existing state programs. For example, a new plant operating in the Regional Greenhouse Gas Initiative (RGGI) territory would have to achieve the final federal standard, and would also have to submit tradable emission allowances annually to comply with the requirements of RGGI.
How does the final rule relate to EPA’s work on a standard for existing power plants?
Section 111 of the Clean Air Act requires EPA to regulate greenhouse gas emissions from new and existing power plants under two separate but related provisions. Section 111(b) requires EPA to set emission performance standards for new, modified, and reconstructed power plants, while Section 111(d) requires EPA to set guidelines for existing power plants. The guidelines for existing power plants cannot be finalized until a final standard is in place for new power plants.
Section 111(b) vests relatively more authority in EPA, and is more straightforward. EPA is required to find emission-reduction technology that has been adequately demonstrated and use this to set federal, numerical performance standards that new power plants must meet. These Section 111(b) standards are implemented by the states, as are most EPA air rules, but states do not have much flexibility to alter the standards set by EPA. On the other hand, under Section 111(d), states have greater flexibility in how they implement the EPA standard. For instance, Section 111(d) allows for the possibility of market-based mechanisms to reduce emissions system-wide, rather than focusing on individual power plants.
Under what authority is EPA regulating greenhouse gas emissions?
EPA is required by the Clean Air Act to develop and enforce regulations on greenhouse gases, much in the way it regulates other air pollutants. This authority was clarified in the U.S. Supreme Court decision in Massachusetts v. EPA (2007). The decision was a result of 12 states petitioning EPA to regulate greenhouse gases from new motor vehicles in 1999. The Supreme Court ruled that greenhouse gases meet the definition of air pollutants under the Clean Air Act and must be regulated if these gases could be reasonably anticipated to endanger public health or welfare. Responding to the Court’s ruling, EPA finalized an endangerment finding in December 2009. Based on overwhelming scientific evidence it found that six greenhouse gases, including carbon dioxide, constitute a threat to public health and welfare. Thus, it is the Supreme Court’s interpretation of the existing Act and EPA’s assessment of the scientific evidence that form the basis for EPA’s regulatory actions.
Once any substance becomes a regulated pollutant under the Clean Air Act, certain other provisions of the Act automatically kick in. Greenhouse gases first became regulated under the Act with EPA’s rule setting new standards for light-duty vehicles. This, in turn, triggered the requirement that major new or modified stationary sources be subject to a handful of Clean Air Act provisions, including Section 111(b).
Has EPA regulated greenhouse gas emissions before?
Yes. In addition to its existing greenhouse gas standards for new light duty vehicles, EPA regulates greenhouse gas emissions from new, large stationary sources through a process called New Source Review (NSR). If a new emissions source, including a power plant, will emit above a certain threshold, it must acquire a permit to emit greenhouse gas. This permit will include a requirement that the source employ the Best Available Control Technology (BACT) to ensure it will take all feasible steps available to limit greenhouse gas emissions. BACT is set on a source-specific basis, and so far EPA has determined BACT for greenhouse gas emissions from power plants to be efficiency improvements. Once EPA’s proposed NSPS is finalized, new power plants will have to comply with both this NSPS and NSR, as well as other permitting requirements already in place.
Why is regulation of greenhouse gas emissions from power plants important?
Electric power generation is responsible for about 40 percent of U.S. emissions of carbon dioxide, the primary greenhouse gas.
Figure 1: 2013 U.S. CO2 Emissions
Source: Energy Information Administration
Since the federal government adopted new vehicle standards in August 2012 to reduce transportation-related emissions, the power sector represents the next opportunity to achieve significant carbon reductions.
Coal and natural gas are used to fuel around two-thirds of U.S. electricity generation, and are responsible for nearly 100 percent of power sector CO2 emissions. As shown in Figure 2, the United States currently obtains 30 percent of its electricity from natural gas. Since 2000, however, natural gas has accounted for over 90 percent of new fossil generation capacity, and most new generation planned for the next few years will be fueled by natural gas.
Figure 2: 2012 U.S. Electricity Generation
Source: Energy Information Administration
Figure 3: Proposed U.S. Fossil Generation Capacity
Source: Energy Information Administration
Congressional Testimony of Judi Greenwald on the Future of Coal: Carbon Capture, Utilization and Storage
Testimony of Judi Greenwald, Vice President for Technology and Innovation
Center for Climate and Energy Solutions
Subcommittee on Energy
Committee on Science, Space, and Technology
U.S. House of Representatives
July 25, 2013
Click here to view video of the testimony.
Hearing on The Future of Coal: Utilizing America's Abundant Energy Resources
Carbon Capture, Utilization and Storage
Madam Chairman, Rep. Swalwell, and members of the Subcommittee, thank you for the opportunity to testify on carbon capture, utilization, and storage. My name is Judi Greenwald, and I am Vice President for Technology and Innovation at the Center for Climate and Energy Solutions (C2ES – formerly known as the Pew Center on Global Climate Change).
My testimony today will focus on the most important climate and energy solution that no one knows about. I will emphasize two main points:
- Carbon capture and storage (CCS) is a critical technology for solving climate change, while allowing continued reliance on fossil fuels.
- Carbon dioxide enhanced oil recovery (CO2-EOR) can advance CCS, while boosting domestic oil production and generating net federal revenue.
C2ES is an independent, nonprofit, nonpartisan organization dedicated to advancing practical and effective policies and actions to address our global climate change and energy challenges. We perform multifaceted research and analysis of the scientific, technological, economic, and policy aspects of these issues. Our work is informed by our Business Environmental Leadership Council (BELC), a group of 34 major companies, most in the Fortune 500, that work with C2ES on climate change and energy risks, challenges, and solutions. The views I am expressing, however, are those of C2ES alone.
C2ES has been analyzing CCS for over a decade and has recently focused on how CO2-EOR can advance CCS. With the Great Plains Institute, C2ES co-convenes the National Enhanced Oil Recovery Initiative, or NEORI, a coalition of businesses, environmental NGOs, labor representatives, and state officials advocating for incentives to use captured CO2 in EOR. You can find more information on NEORI at www.neori.org. I would like to submit NEORI’s CO2-EOR analysis and consensus recommendations for the record. In addition, C2ES serves as the advisor and facilitator to the Sequestration Working Group of the North America 2050 Initiative, a collaborative of states and provinces exploring options for CCS regulations and incentives. C2ES recently completed a summary of state-level regulations and incentives that can be found at www.na2050.org/sequestration.
C2ES also has authored research and publications related to CCS and CO2-EOR. For example, C2ES developed a comprehensive framework for calculating CO2 emissions from CCS based on input from experts in industry, academia, and the environmental community. C2ES also publishes a CCS Climate TechBook, a brief report that explains in layman’s terms how CCS technology works, why its development is needed to address climate change, and how it might be advanced.
CCS is a critically important technology
The United States and the rest of the world are getting 80 percent of our energy from coal, oil and gas, and our dependence on, and overall use of, these fossil fuels globally is growing rapidly. Under a business-as-usual scenario, the Energy Information Administration expects fossil fuels will continue to provide more than 65 percent of U.S. electricity in 2040 – with 35 percent coming from coal-fired generation. Globally, coal consumption is expected to increase nearly 60 percent over the next two decades, led by developing countries like China and India, which together will comprise 62 percent of the total global coal demand in 2035. This poses an enormous challenge, because the CO2 emissions from the combustion of these fossil fuels are the major contributor to global climate change. While we can and should become more energy-efficient and shift our energy mix toward inherently zero-emitting sources like nuclear power and renewables, it will be difficult to do that fast enough and at a reasonable enough cost to avoid the worst climate impacts.
Hence the critical need for CCS, a suite of technologies that captures CO2 and stores it deep underground in geological formations. CCS can capture up to 90 percent of emissions from stationary sources, such as power plants and industrial facilities, thereby allowing coal and natural gas to remain part of our energy mix. The International Energy Agency (IEA) and others have demonstrated through detailed technology and economic scenario analyses that CCS is likely an essential component of an affordable and effective response to global climate change. In fact, IEA estimates that CCS could provide one-sixth of the requisite GHG emissions reductions by 2050.
What is needed to advance CCS?
CCS has been established and commercialized for the capture of CO2 from some industrial processes such as natural gas processing, chemical, fertilizer and ethanol production, and the gasification of coal. The use of man-made CO2 in EOR has been practiced for several decades. However, CCS in other contexts – for example, coal- and natural gas-powered electricity generation – is a relatively expensive technology that is just reaching maturity. Further R&D is important, but the key challenge for CCS is to get a sufficient number of commercial-scale projects up and running to demonstrate the emerging technologies at scale and bring down their costs. The first large-scale commercial CCS power projects are under construction. Yet, it is still unclear whether more commercial-scale CCS projects will be built after these initial projects are completed. After the collapse of climate legislation in the United States in 2010, a number of CCS projects were cancelled.
CCS is being increasingly thought of as carbon capture utilization and storage, or CCUS. Instead of seeing CO2 as a waste, utilizing and selling captured CO2, primarily for EOR, improves the economics of CCS projects and is an important market driver. Almost all of the existing or planned CO2 capture projects in the United States have been developed with the intention of marketing captured CO2 for use in EOR. Still, in many cases, additional drivers are needed. Those projects operating or underway today are being financed though some combination of U.S. Department of Energy (DOE) grants, utility cost recovery from ratepayers, private finance, sales of CO2 for EOR, other revenue streams from chemical production, and existing tax credits.
DOE’s role in CCS development has been and will remain critical. DOE is working with the private sector on the leading innovative CCS projects in the United States today. This collaboration is beginning to yield results. In late 2012, the DOE-supported Air Products’ Port Arthur CCS project, where CO2 is captured from refinery-based hydrogen production and sent for use in EOR, began operations. Through its Industrial Carbon Capture and Storage (ICCS) Program and with funding from the American Recovery and Reinvestment Act of 2009 (ARRA), DOE agreed to fund $284 million of the Port Arthur project’s $430 million total investment cost. The Port Arthur project is expected to capture up to 1 million tons of CO2 per year and enable EOR production of 1.6 million to 3.1 million barrels of domestic oil a year in East Texas.
DOE is also working on applying CCS to the power sector. Southern Company’s coal-fueled Kemper County energy facility in Mississippi is now under construction and will be the first commercial-scale CCS power project in the United States. DOE selected the Kemper project to receive more than $290 million through its Clean Coal Power Initiative (CCPI). A later round of the CCPI made possible through ARRA funding selected three additional coal-fired CCS power projects for funding. They are Summit Power’s Texas Clean Energy Project (TCEP), NRG Energy’s Washington Parish Project, and SCS Energy’s Hydrogen Energy California project. TCEP is nearing financial close and, when completed, will capture 90 percent of its emissions and supply approximately 2.5 million tons of CO2 for use in EOR.
Given the high costs and uncertainties of CCS investment for the private sector and the urgent need for CCS, it is extremely important that the federal government continue to support CCS research, development, demonstration, and deployment. Beyond DOE’s pivotal role, other forms of federal financial support, such as tax credits, should be reformed and expanded. States too can play a key role in advancing CCS through incentives and well-informed regulation.
Background on CO2-EOR
CO2-EOR is a means of commercial oil production that could play a key role in the development of CCS and in increasing our domestic energy security. CO2-EOR has the potential to increase American oil production by tens of billions of barrels, while displacing imported oil and safely storing billions of tons of CO2 underground.
How does CO2-EOR work? Even after conventional primary and secondary oil recovery, most of the oil in a typical oil field is left in the ground. When injected deep underground, CO2 can make it possible to recover more oil and extend an oil field’s life. The best available evidence indicates that by using best EOR industry practice and existing rules governing underground injection, the overwhelming majority of the injected CO2 remains underground, incidentally and safely storing CO2. Commercial injection of CO2 for EOR is regulated under EPA’s Underground Injection Control Program, and under current federal greenhouse gas reporting rules for air emissions, EOR operators may document this incidental CO2 storage through additional monitoring, reporting, and verification requirements to qualify as geologic sequestration. There is a range of views as to what additional state or federal rules are needed to ensure that CO2 is stored permanently.
The United States has been a global leader in CO2-EOR for 40 years. We currently obtain six percent of our domestic oil production through this method. While most CO2-EOR activity occurs in the Permian Basin of Texas, there are also projects in the Gulf Coast, the Rocky Mountains, Oklahoma, and even Michigan. Estimates of the potential for CO2-EOR to increase oil production and store CO2 have been increasing in recent years. According to the National Energy Technology Lab, using existing techniques, CO2-EOR could double or triple U.S. oil reserves and store 10 to 20 billion tons of CO2, which is equivalent to between five and 10 years of emissions from all U.S. coal-fired power plants. More advanced techniques could yield much higher oil production and CO2 storage.
The key role of CO2-EOR in advancing CCS
For those CO2 capture technologies that have not reached full commercialization, especially in electric power generation, selling captured CO2 for use in EOR can provide a revenue stream that helps reduce the financial risks and uncertainty of investing in emerging technology. About 75 percent of the CO2 used in EOR currently comes from naturally occurring CO2 reservoirs. The rest comes from man-made CO2 sources. Somewhat oddly, the EOR market lacks sufficient CO2. By expanding carbon capture from man-made sources, we can increase domestic oil production, promote economic development, create jobs, reduce CO2 emissions, and drive innovation in CCS technology.
It is because of these multiple benefits that we have been able to bring together the National Enhanced Oil Recovery Initiative, or NEORI, a diverse coalition favoring the reform and expansion of existing tax incentives to use captured CO2 in EOR. Among the members of NEORI are Arch Coal, Summit Power, Tenaska, the Natural Resources Defense Council, AFL-CIO, and The Wyoming Outdoor Council. Some of NEORI’s participants are primarily interested in job creation, others in increasing domestic oil production, and others in protecting the environment. But all agree that advancing the capture of man-made CO2 for use in EOR makes sense. NEORI has been briefing members on both sides of the aisle in both houses of Congress on its proposals.
EOR operators in some regions are willing to pay upwards of $30 per ton for CO2. At the same time, industrial facilities and power plants are emitting billions of tons of CO2 into the atmosphere as a waste. CO2-EOR therefore offers the opportunity to transform this waste into a marketable commodity and transform an environmental problem into an energy production solution.
In a few cases, revenue from selling CO2 for enhanced oil recovery is sufficient to pay for CO2 capture and transport. Thanks to the efforts of the private sector and DOE, many CO2 capture technologies are already commercially proven, and only a modest incentive is needed to help close the gap between the market price of CO2 and the costs to capture and transport it. In the case of emerging technologies, however, companies need a larger incentive to help shoulder the additional financial and operational risk of deploying new, pioneering capture projects for the first few times at a commercial scale.
By combining private EOR operators’ willingness to pay for CO2 with a tax incentive, society leverages its public investment. Perhaps most importantly, according to our analysis, such tax incentives would more than pay for themselves by driving increased domestic oil production and associated taxable oil revenues. Increased CO2-EOR production will generate federal revenue that more than pays for the cost of new incentives within a 10-year timeframe. Under existing tax treatment, CO2-EOR directly yields revenues from three main sources: corporate income taxes, individual income taxes on royalties from production on private land, and royalties from production on federal land. Our analysis indicates that federal revenues from incremental CO2-EOR production would exceed the fiscal cost of new incentives by more than $100 billion over 40 years.
CCS is a critical technology for reconciling our continued dependence on fossil fuels with the imperative to protect the global climate. Our best hope at the moment for CCS advancement is carbon capture, utilization, and storage, or CCUS. The best example of CO2 utilization we know of is enhanced oil recovery (CO2-EOR). Solving our climate and energy problems will require a portfolio of technologies, and all must be pursued vigorously. But we are focusing here today on CO2-EOR, because it is the most important climate and energy solution that no one knows about.
In 2009, the Obama Administration convened the Interagency Climate Change Adaptation Task Force, and the President signed Executive Order 13514, directing agencies to improve energy and water efficiency, better manage waste and pollution, and reduce greenhouse gas emissions. In addition, the Order requested that agencies identify vulnerabilities and put together a climate adaptation plan by June 2012. The plans were released in February 2013 and began implementation for FY 2013. These Adaptation Plans are often part of an agency’s broader Sustainability Plan and will be updated each year.
Highlighted Adaptation Plans
Other Federal Agency Adaptation Resources
Other federal agencies have published climate change adaptation plans as directed by Executive Order 13514. These agencies are either smaller or have provided fewer details in their adaptation plans; links to the plans are below:
In his speech on Tuesday laying out a national climate action plan, President Obama called on federal agencies to lead by example in taking actions to reduce their emissions of greenhouse gases.
In a new report today, the Center for Climate and Energy Solutions (C2ES) highlights one area where the federal government is making progress, and can achieve much more. It’s called Leading by Example 2.0: How Information and Communication Technologies Help Federal Agencies Meet Sustainability Goals.
Faced with declining budgets, federal agencies are looking for innovative ways to cut costs while meeting a growing list of sustainability mandates. Expanding the use of information and communication technologies (ICT) – metering and energy management systems for buildings, GPS-based tools for fleets, teleconferencing, e-training, teleworking, and cloud-based data storage – offer agencies new ways to reduce their energy use, cut greenhouse gas emissions and enhance productivity.
We estimate widespread deployment of ICT could help reduce greenhouse gas emissions by 12 percent, roughly half the amount called for under a 2009 executive order, and could save an estimated $5 billion in energy costs through 2020.
In his State of the Union address, President Obama promised stronger action on climate change. Today he followed up with a credible and comprehensive plan. The real issue now is how vigorously he follows through.
From a policy perspective, the president’s plan lacks the sweep, cohesion and ambition that might be possible through new legislation. With Congress unwilling to act, the president instead is offering an amalgam of actions across the federal government, relying on executive powers alone.
Taken together, the actions represent the broadest climate strategy put forward by any U.S. president, addressing the need to both cut carbon emissions and strengthen climate resilience. While many of the specific items are relatively small-bore, and quite a few are actions already underway, the plan also includes new initiatives that can significantly advance the U.S. climate effort.
Statement of Eileen Claussen
President, Center for Climate and Energy Solutions
June 25, 2013
President Obama is laying out a credible, comprehensive strategy to use the tools at his disposal to strengthen the U.S. response to climate change. His plan recognizes that the costs of climate change are real and rising, and that to minimize them we must both cut our carbon output and strengthen our climate resilience. Putting these critical issues before the American public is itself a step forward. But it will require continued presidential leadership to translate the plan’s good intentions into concrete policy.
The most cost-effective way to reduce greenhouse gas emissions is for Congress to enact an economy-wide price on carbon. As long as Congress is unwilling to act, the president is right to use his powers under the Clean Air Act to curb emissions from power plants, by far the largest unregulated source of U.S. carbon emissions. Many companies are prepared to work with the administration on pragmatic approaches that cut emissions while keeping U.S. electricity affordable and reliable. Companies want regulatory certainty and know that continued inaction exposes them to increasing climate risks.
In crafting the power plant rules, EPA should consult widely with utilities and with the states, which ultimately must implement them. We strongly encourage EPA to devise a flexible strategy that allows a variety of state-level policies, including market-based approaches, and allows utilities to cut emissions at the lowest possible cost.
With extreme weather and other climate impacts being felt across the country, the president also is right to place equal emphasis on strengthening America’s climate resilience. His plan will help communities and businesses apply the lessons learned from Hurricane Sandy and other extreme events to better cope with future climate risks.
Implementing the president’s plan will be extremely challenging. But a clear majority of the American public favors stronger climate action, and with a plan in place, the administration must now follow through with a true sense of urgency. We look forward to working with the administration as it moves forward.
Contact: Laura Rehrmann, 703-516-0621, email@example.com
The Center for Climate and Energy Solutions (C2ES) is an independent, nonprofit, nonpartisan organization promoting strong policy and action to address the twin challenges of energy and climate change. Launched in November 2011, C2ES is the successor to the Pew Center on Global Climate Change. Learn more at www.c2es.org.
Energy efficiency standards for appliances and equipment reduce energy use in residential and commercial buildings and the associated greenhouse gas emissions. In 2011, buildings, and the appliances and equipment used inside of them, accounted for 34 percent of U.S. greenhouse gas emissions (emitted either directly from the buildings or in the generation of the electricity used in the buildings).
Laws authorizing the U.S. Department of Energy (DOE) to set appliance and equipment efficiency standards were first enacted in the 1980s and have since been expanded to new categories of equipment. DOE also is required to periodically strengthen existing standards. In setting a standard, DOE must take into consideration factors including increased cost of the product, lifetime operating cost savings, total projected energy savings, the need for national energy savings, impacts on product performance, and impacts on manufacturer competition.
DOE recently set new energy efficiency standards for microwave ovens and distribution transformers:
- Automatic commercial ice makers. Automatic commercial ice makers provide large volumes of ice used in soft drinks, ice water, and other beverages, and also to keep fresh fish, salad bars, and other products cold in locations such as hotels, restaurants and cafeterias, hospitals, schools, grocery and other retail stores, and office buildings. Strengthened standards for these lamps were issued in December 2014 and will go into effect in 2018. They are expected to save consumers save $600 million through 2030 and avoid the emissions of 4 million metric tons of CO2.
- Commercial refrigeration equipment. Commercial refrigeration equipment is used for food storage and merchandising in the food retail industry (e.g., grocery stores, supermarkets convenience stores, specialty food stores) and the foodservice industry (e.g., restaurants and cafeterias). Standards for this type of equipment were first established in the Energy Policy Act of 2005. Strengthened standards were issued by DOE in a final rule on February 28, 2014. These standards are expected to save businesses between $4.9 billion and $11.7 billion by 2047 and avoid the emission of 142 million metric tons of CO2.
Conventional ovens. Conventional ovens are home cooking products that may be fuel by natural gas or electricity, standard or self-cleaning. The Energy Policy and Conservation and Policy Act of 1975 gives DOE the authority to set energy conservation standards for residential conventional ovens, and the National Appliance Energy Conservation Act of 1987 set prescriptive standards for certain cooking products. The most recent standards were established in 2009. A pre-publication notice of proposed strengthened standards was issued by DOE on June 1, 2015. By 2048, emissions reductions from these proposed standards would 41 million metric tons of CO2 and 221 thousand tons of methane, a potent greenhouse gas. The cumulative reduction of CO2 by 2030 would be 7.5 million metric tons. Strengthened standards are estimated to save consumers between $4.7 billion and $11 billion.
- Electric motors. Electric motors convert electric energy into rotational energy and are often used for blowers, compressors, conveyors, fans, and pumps. There are three categories of electric motors, defined, among other ways, by their voltage, power, and rotation speed. Standards for this equipment were first established in the Energy Policy Act of 1992, but the Energy Independence and Security Act of 2007 significantly expanded the scope of covered motors. In May 2014, DOE issued a final rule for electric motors that would avoid emission of 395 million metric tons of CO2 by 2044. The rule went into effect in December 2015.
- Furnace fans. Furnace fans circulate heated air through a home’s duct system. Standards for this equipment were first authorized in the Energy Policy and Conservation Act of 1975. In June 2014, DOE announced the first ever energy efficiency standard for furnace fans. This standard will avoid the emission of 181 million metric tons of CO2 by 2048 and go into effect in 2019.
- Distribution transformers. Distribution transformers transform the high-voltage electric current from power lines into lower-voltage electricity that can be used in homes and businesses. These transformers can be found in metal boxes on utility poles where power enters a neighborhood, at ground level on a metal slab, or underground. Standards for liquid-immersed and medium-voltage dry-type distribution transformers were first required under the Energy Policy Act of 1992, while standards for medium-voltage dry-type distribution transformers were set in the Energy Policy Act of 2005. Strengthened standards for all types were issued by DOE in a final rule on April 18, 2013. These standards are expected to save from $3.4 billion to $12.9 billion and prevent the emission of 264.7 million metric tons of CO2.
- External power supplies. External power supplies are the boxes on power cords that convert household electric current into direct current or lower-voltage alternating current in order to operate consumer products, such as computers or cell phones. Standards for this equipment were first established in the Energy Independence and Security Act of 2007. Strengthened standards were issued by DOE in a final rule on February 10, 2014. These standards are expected to save consumers from $1.9 billion to $3.8 billion by 2044 and avoid the emission of 47 million metric tons of CO2.
- General service fluorescent lamps and incandescent reflector lamps. These lamps are used for indoor lighting in homes, commercial establishments such as restaurants, and in industrial factories. Standards for these lamps are required under the Energy Policy and Conservation Act of 1975. Strengthened standards for these lamps were issued in December 2014 and will go into effect in 2018. They are expected to save consumers $15 billion through 2030 and cut 90 million metric tons of CO2.
- Hearth Products. Hearth products are used for heating and decoration in homes and businesses. Standards for this equipment were first authorized in the Energy Policy and Conservation Act of 1975, although the first ever standards for hearth products, decorative products, gas logs, gas stoves, and outdoor hearth products were announced in January 2015. The proposed standards would require manufacturers to eliminate continuously burning pilot lights in favor of electronic ignition. They are expected to save consumers $3 billion from 2021 to 2051. The standards would prevent the emission of 11.1 million metric tons of CO2 from 2021 to 2030 and an additional 26 million metric tons of CO2 from 2030 to 2050. A final rule is expected in December 2015 with an effective date of 2020.
- Metal halide lamp fixtures. Metal halide lamp fixtures provide lighting for parking lots and streets, flood lighting, athletic facilities, big-box stores, and warehouses. Standards for this equipment were first established in the Energy Independence and Security Act of 2007. Strengthened standards were issued by DOE in a final rule on February 10, 2014. These standards are expected to save consumers from $950 million to $3.2 billion by 2046 and avoid the emission of 22.5 to 27.8 million metric tons of CO2.
- Microwave ovens. Microwave ovens are consumer products that use microwaves to cook or heat food. Some microwave ovens also have thermal elements that allow them to cook food much like a conventional oven. Standards for this equipment were first authorized by the National Appliance Energy Conservation Act of 1987. However, the first efficiency standards for microwaves for power consumption during operation, as well as standby mode, were released on June 17, 2013. These standards are expected to save consumers from $1.53 billion to $3.38 billion and prevent the emission of 38.11 million metric tons of CO2.
- Walk-in coolers and freezers. The coolers and freezers covered by the new standards are used to store refrigerated or frozen food or other perishable goods, and are used primarily in the food service and food sales industry. Coolers and freezers covered by the regulations are enclosed storage spaces that can be walked into, have a total chilled storage area of less than 3,000 square feet, and do not include products designed and marketed exclusively for medical, scientific, or research purposes. The 2013 standards for walk-in coolers and freezers set a minimum R-value* for insulating panels, as well as requirements for doors, door closures, motors and lighting. Standards for this equipment were first established in the Energy Independence and Security Act of 2007. In May 2014, DOE issued a final rule that would avoid the emission of 159 million metric tons of CO2 by 2046. The rule will go into effect in 2017. (*R-value is a measure of the amount of insulation provided. For example, insulation panels with a higher R-value will allow less heat to pass through them.)
DOE is currently considering establishing or strengthening energy efficiency standards for these categories of appliances and equipment:
- Portable Air Conditioners. Portable air conditioners are units that cool air and can be moved from room to room. They are distinct from window box units or central air conditioning systems. DOE is soliciting public comments on a proposed rule to include portable air conditioners as a category of consumer appliances for which standards can be established.
- Computers. Computers are devices that include (but is not necessarily limited to) desktop computers, integrated desktop computers, laptop/notebook/netbook computers, and workstations. DOE is soliciting public comments on a proposed rule to include computers as a category of consumer appliances for which standards can be established.
- Computer servers. Computer servers provide services and manage networked resources for client devices such as desktop and laptop computers. These services and resources are accessed via a network connection. DOE is soliciting public comments on a proposed rule to include computer servers as a category of equipment for which standards can be established.
- Ellipsoidal diameter, bulged reflector, and small diameter reflector lamps. Ellipsoidal diameter, bulged reflector, and small diameter reflector lamps are types of incandescent reflector lamps (IRLs). IRLs are directional lamps, such as spotlights and floodlights, which can be used in residential and commercial applications, such as recessed downlighting and track lighting. They have a reflective coating on the inside of the bulb to focus and aim the light. While most IRLs were subject to efficiency standards under the Energy Policy Act of 1992, these subcategories were excluded before enactment of the Energy Independence and Security Act of 2007, and then delayed by a rider to the FY 2012 Energy and Water Appropriations bill.
President Obama's Climate Action Plan outlines a wide array of actions his administration will take using existing authorities to reduce carbon pollution, increase energy efficiency, expand renewable and other low-carbon energy sources, and strengthen resilience to extreme weather and other climate impacts. As part of the plan, annoujnced in June 2013, the president directed the Environmental Protection Agency to set standards by June 2015 to reduce carbon pollution from existing power plants.
C2ES President Eileen Claussen calls Obama's plan "a credible, comprehensive strategy to use the tools at his disposal to strengthen the U.S. response to climate change. His plan recognizes that the costs of climate change are real and rising, and that to minimize them we must both cut our carbon output and strengthen our climate resilience."
Here are links to:
- The President’s Climate Action Plan
- President Obama’s speech at Georgetown University
- The President’s Memorandum to EPA on Power Sector Carbon Pollution Standards
C2ES Resources on Key Topics:
President Obama’s Climate Action Plan focuses on:
- Regulating Greenhouse Gas Emissions
- Energy Efficiency
- Renewable Energy
- Natural Gas
- Leading by Example
- Climate Resilience
- International Climate Change Leadership
Congress has granted the Environmental Protection Agency (EPA) authority to regulate a wide range of pollutants through several laws, including the Clean Air Act. The Supreme Court ruled in 2007 that EPA has authority under the Clean Air Act to regulate greenhouse gases. Carbon pollution standards for new power plants proposed by EPA in March 2012 have not yet been finalized. On June 25, President Obama announced a Presidential Memorandum directing the EPA “to work expeditiously to complete carbon pollution standardsfor both new and existing power plants.”
For more information, see:
- Q & A on Regulating Emissions from Existing Power Plants
- Carbon Pollution Standard for New Power Plants
- EPA Climate and Energy Action
- Overview of the U.S. Power Sector
- Climate Techbook: Carbon Capture and Storage
- Domestic Policies to Reduce the Near-Term Risks of Climate Change
- National Enhanced Oil Recovery Initiative
The president directed the Department of Energy to build on efficiency standards set during his first term for dishwashers, refrigerators, and other products. He set a goal of cumulatively reducting carbon dioxide emissions by 3 billion metric tons by 2030 through efficiency measures adopted in his first and second terms. The president also committed to build on heavy-duty vehicle fuel efficiency standards set during his first term with new standards past the 2018 model year.
For more information, see:
- Department of Energy Appliance Standards
- Federal Vehicle Standards
- Make an Impact
- Corporate Energy Efficiency
Renewable energy is the fastest growing energy source. In 2012, renewable energy was responsible for 12.7 percent of net U.S. electricity generation with hydroelectric generation contributing 7.9 percent and wind generation 2.9 percent. In the president’s climate plan, he reiterates his support to make renewable energy production on federal lands a top priority.
For more information, see:
- Renewable Energy
- Clean Energy Markets: Jobs and Opportunities
- Climate Techbook: Solar Power
- Climate Techbook: Wind Power
New drilling technologies such as hydraulic fracturing (sometimes called fracking) have vastly increased the amount of recoverable natural gas in the United States and elsewhere. These advances are projected to keep the price of this lower-carbon fuel near historically low levels, significantly altering energy economics and trends, and opening new opportunities to reduce greenhouse gas emissions. To better leverage natural gas to reduce greenhouse gas emissions, the administration will develop an interagency methane strategy to further reduce emissions of this potent greenhouse gas.
For more information, see:
In his first term, President Obama set a goal to reduce federal greenhouse gas emissions by 24 percent by 2020. He also required agencies to enter into at least $2 billion in performance-based contracts by the end of 2013 to finance energy projects with no upfront costs. In his climate plan, the president established a new goal for the federal government to consume 20 percent of its electricity from renewable energy sources by 2020—more than double its current goal of 7.5 percent.
For more information, see:
- Leading by Example: Using Information and Communication Technologies to Achieve Federal Sustainability Goals
The president wants federal agencies to support local investments in climate resilience and convene a task force of state, local, and tribal officials to advise on key actions the federal government can take to help strengthen communities. President Obama also wants to use recovery strategies from Hurricane Sandy to strengthen communities against future extreme weather and other climate impacts and update flood-risk reduction standards for all federally funded projects.
For more information, see:
- Climate Adaptation
- Building Business Resilience to Climate Change
- Climate Change Adaptation: What Federal Agencies Are Doing
- Extreme Weather and Climate Change
- Climate Change and Hurricane Sandy
The president promised to expand new and existing international initiatives with China, India, and other major emitting countries. He also called for an end to U.S. government support for public financing of new coal-fired powers plants overseas, except for the most efficient coal technology available in the world's poorest countries, or facilities deploying carbon capture and sequestration technologies.
For more information, see: