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Biden moves past Clean Power Plan, with an eye to a clean electricity standard
18 February 2021
The US Environmental Protection Agency will not seek to
resurrect the Obama-era Clean Power Plan to reduce carbon emissions
from power plants, a move that follows recent signals from a
high-level Biden administration official indicating the
administration may pursue some form of carbon pricing to achieve
emissions reductions.
The EPA sent a memo 12 February to its
regional offices in which a senior agency official noted that
reinstating the 2015 Clean Power Plan (CPP) in response to a
federal appeals court ruling in January would be pointless because
utilities already had met that rule's goal of reducing power plant
emissions by 32% compared with 2005 levels by 2030.
The memo responds to the January ruling by the US Court of
Appeals for the District of Columbia Circuit (DC Circuit), which vacated the 2019 Affordable
Clean Energy rule (ACE), a Trump administration replacement for CPP
that set no carbon limits on power plants.
Although the DC Circuit remanded the ACE rule back to EPA for a
certain death under the Biden administration, Goffman said the
court did not "expressly reinstate the CPP."
Since the DC Circuit's ruling, EPA's regional offices have
received inquiries from states wanting to know what their remaining
obligations were, if any, under the ACE rule.
At least 18 states including Ohio, West Virginia, Kentucky, and
Texas told IHS Markit in January they
were in the process of writing plans to comply with the ACE
deadline of July 2022, which is now defunct. The court's decision
leaves states in limbo, which Goffman's memo attempts to
clarify.
New Opportunity
As for the current administration's plans going forward, Michael
Regan, Biden's nominee to lead EPA, said the agency would initially
review the details of the CPP and ACE rules before setting a policy
course that he suggested would be a "significant opportunity" for
new emissions reduction strategies.
"It's my understanding that we have to take a look at what was
the plan for the [CPP] and what were the plans for the ACE rule,"
he told lawmakers at his February 3 Senate confirmation hearing.
"The reality is that it presents a significant opportunity for the
[EPA] to take a clean slate and look at how do we best move
forward."
But West Virginia Attorney General Patrick Morrisey and other
Republican attorneys general last month wrote Biden to warn they
would be closely watching the new administration for any sign of
regulatory overreach.
Biden's goal of decarbonizing the power sector by 2035 means
that whatever proposal he puts forth will need to be significantly
more ambitious than the CPP. But whether the next plan will be
another set of regulations, a legislatively approved clean
electricity standard (CES), tax policies, a national emissions
cap-and-trade system-or all of the above-remains to be seen.
Notably, some conservative and energy industry groups-including
the American Petroleum Institute-have expressed vague support for a
carbon pricing plan, but that approach appears politically
problematic in Congress.
Reviving clean electricity standard
The Democrat leaders of the US House of Representatives' Energy
and Commerce Committee floated, but never formally introduced, a
national CES as a centerpiece of climate legislation known as the
Clean Future Act. But that package went nowhere and the CES was
criticized by some Republicans. However, the CES could be one of
the most effective ways to transition the utility sector away from
fossil fuels, say some environmentalists and researchers who insist
it must be part of the solution.
During an 18 February hearing on clean energy pathways for the
US, Energy and Commerce Committee Chairman Frank Pallone,
Democrat-New Jersey, said he plans to introduce the legislation in
the coming weeks. This bill will not only set a national CES, but
also will underscore the "importance of prioritizing clean and
resilient energy infrastructure."
Environmental groups already have floated the possibility of
using the congressional budget reconciliation process to push
through passage of a CES. That approach would require only a simple
majority vote in the Senate to pass legislation, as opposed to the
60-vote bar that Democrats otherwise would have to clear to
overcome a likely filibuster by Senate Republicans.
In a February 4 report, researchers at the University of
California Santa Barbara and the think tank Evergreen Collaborative
outlined three ways by which carbon legislation could meet legal
requirements for use of the budget reconciliation process. The
report said acceptable legislation could include block grants to
states for 100% clean energy; a tax code-based clean power policy;
or a federal carbon intensity standard for electricity.
There has been speculation that Biden may seek to use the budget
reconciliation process to pass an infrastructure bill that might
prove a popular legislative vehicle that could carry carbon
proposals.
However, Democratic leaders in US Congress have made COVID-19
relief a priority. Given the tenuous 50-50 power sharing
arrangement in the US Senate, it remains unclear the extent to
which Democrats will push for the CES at the expense of a potential
agreement on the relief package.
--Original reporting by George Lobsenz. Contribution by
Amena Saiyid.
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