President Donald Trump is scaling back sweeping Obama-era curbs on greenhouse gas emissions from power plants burning coal, his biggest step yet to fulfill his campaign promise to stop a “war” on the fossil fuel.
But analysts say the Environmental Protection Agency’s rewrite of the Clean Power Plan, unveiled Wednesday in Washington, will do little to halt a nationwide shift away from coal and toward less expensive electricity generated by the wind, the sun and natural gas.
The U.S. is experiencing “a wave of coal retirements — and we don’t think we’re near the end of it,” said Nicholas Steckler, head of U.S. power for BloombergNEF. “Coal is inferior to natural gas in many ways today — it’s less flexible, it’s higher cost, even its fuel is generally more expensive, and, of course, it’s dirty. It has so many reasons stacked against it.”
The EPA’s final “Affordable Clean Energy” rule focuses cutting carbon dioxide emissions by encouraging efficiency upgrades at individual power plants, replacing an Obama-era approach of driving wholesale changes to the power sector. The final rule empowers states to develop performance standards for plants based on assumptions about the kind of efficiency gains — known as heat-rate improvements — that can be eked out by plugging duct leaks, installing advanced soot blowers and making other upgrades at the sites.
EPA Administrator Andrew Wheeler touted the final regulation at the agency’s headquarters in Washington, in front of industry lobbyists, conservative activists and a group of workers in hard hats and neon-striped jackets. Wheeler signed the rule flanked by Mick Mulvaney, the acting White House chief of staff, Rep. David McKinley, a Republican from coal-rich West Virginia, and other Trump administration officials.
The new rule “will continue our nation’s environmental progress, and it will do so legally and with proper respect for the states,” without using the “heavy hand” of government, Wheeler said. “These provisions will give states and the private sector the regulatory certainty they need,” while encouraging “cleaner and more affordable energy for the American public.”
A new battle
The measure that the Trump administration is replacing — former President Barack Obama’s Clean Power Plan — aimed to drive broader changes in the U.S. electric mix and threatened to spur a wave of coal plant closures. That measure compelled states to make system-wide changes in the name of cutting emissions, from bolstering energy efficiency and adding renewables to shutting coal-fired plants altogether and even displacing natural gas.
Environmentalists have vowed to battle Trump’s replacement rule in federal court, arguing the EPA is shirking its responsibility to protect public health and the environment. The power plant measure comes as the agency separately moves to ease rules curbing greenhouse gas emissions from automobiles and oil wells.
“The EPA should be strengthening the Clean Power Plan, not scrapping it,” said David Doniger, senior strategic director of the climate and clean energy program at the Natural Resources Defense Council. Trump’s EPA is implementing a “do-nothing” rule and “blowing off the chance to save thousands of lives every year,” he said.
The rule is “an unlawful life-extension program for coal plants masquerading as a climate rule,” said Conrad Schneider, advocacy director for the Clean Air Task Force, an environmental advocacy group. “The ACE rule simply checks the box of a Trump campaign promise in a futile attempt to save the coal industry by calling for investments in old, dirty coal plants that will run harder and longer, resulting in increased pollution.”
The agency had predicted its initial plan would unleash more particulate matter pollution, or soot, and the asthma attacks, respiratory diseases and premature deaths tied to it. The EPA said Wednesday that its final rule is projected to reduce carbon dioxide emissions in 2030 by about 11 million short tons over what would happen without the Clean Power Plan in place.
Industry advocates say the Trump administration is curbing federal government overreach and leveling the playing field.
‘A fighting chance’
“It won’t necessarily be the saving grace for coal,” but “this regulation gives coal a fighting chance,” said Nick Loris, an economist with the Heritage Foundation. The EPA is following the rule of law and removing “government-imposed barriers that will lead to increased innovation, competition and efficiency that will ultimately drive down pollution.”
The EPA’s new approach is rooted in Clean Power Plan foes’ arguments that the agency does not have legal authority to regulate emissions beyond the boundaries of existing plants. In some cases, efficiency gains spurred by the new rule could encourage utilities to run their coal power plants more often, undercutting the potential environmental benefits and actually leading to more emissions at the sites
The flexibility for states in the final rule should help stave off premature coal plant closures, said Michelle Bloodworth, president of the American Council for Clean Coal Electricity. “These improvements to coal plant competitiveness will help to increase the longevity of the existing fleet,” she said.
On the campaign trail in 2016, Trump promised to revive the coal industry and restore mining jobs — a message that resonated with the working-class voters who helped elect him. In coal-rich West Virginia, a once reliably Democratic state, Trump won 68% of the vote.
The Clean Power Plan rewrite is the Trump administration’s most tangible move to deliver on that promise, though the EPA has also proposed lifting a de facto requirement that any new coal power plants be built with expensive carbon-capture technology. The agency also has proposed that limits on mercury pollution from power plants are no longer “appropriate and necessary.”
“This is another example of the president doing exactly what he said he would do when he ran for office,” Mulvaney said. Not only was Obama’s Clean Power Plan “illegal,” Mulvaney said, “it’s a tax” on Americans.
State regulations are also encouraging utilities to adopt more renewable wind and solar power. At the same time, the lower cost and cleaner-burning profile of natural gas has encouraged a shift toward that fossil fuel.
Power plant owners are unlikely to make dramatic shifts in their plans and portfolios based on the Trump administration policy change, especially given the prospects a new president could reverse course as soon as 2021 and amid competing pressure from state policies, said Bloomberg Intelligence analyst Kit Konolige.
“The economics and the desire in many jurisdictions for clean power continue to be the strong drivers of what gets done on the ground,” Konolige said.
While states and utilities with a significant amount of coal will have “more flexibility,” under the Trump administration approach, “everyone’s moving in the direction of eventually eliminating coal plants,” he said.
Some 65 gigawatts of coal-fired electric generating capacity have gone offline since 2011 — with another 41 gigawatts pending retirement and 105 gigawatts at risk of closure, according to BloombergNEF.
The Clean Power Plan never actually went into effect, having been halted by the Supreme Court in February 2016. Even without it, the U.S. is on track to meet its original goals of reducing greenhouse gas emissions 32% from 2005 levels by 2030, BNEF’s Steckler said.
For now, the Trump administration is jettisoning a separate plan that would have made it easier for companies to modernize power plants without triggering requirements for costly pollution control systems. That change will come later, as the EPA works to overhaul its so-called New Source Review program governing pollution controls at power plants and industrial facilities.