It has been just over three years since President Obama announced his extensive climate change agenda, called the Climate Action Plan.
The plan was his answer to Congress' failure to pass comprehensive climate legislation, after action stalled in the Senate during his first term. Instead of relying on Congress, with its increased Republican opposition, Obama decided to enact regulations using his executive authority to meet his climate goals.
The Climate Action Plan directed the Environmental Protection Agency, the Energy Department and other Cabinet-level agencies to begin working on new regulations, while speeding up existing programs to reduce greenhouse gases, which many scientists blame for driving man-made climate change.
The most notorious piece of the president's plan is the rules for existing power plants, called the Clean Power Plan. The regulations for the first time use the EPA's authority to hold states accountable for regulating carbon dioxide emissions, rather than just the owners and operators of power plants. While the EPA says it is not the most expensive of Obama's climate rules, many critics beg to differ.
In addition to the Clean Power Plan, the president implemented rules that place a de facto ban on building new power plants by making the cost of compliance so high, no utility would want to build a coal-fired facility.
Meanwhile, the Department of Energy was charged with expediting energy-efficiency standards for appliances, placing more stringent requirements on manufacturers.
Increasingly stringent regulations for building low-emission vehicles are also a big part of the president's agenda, including new rules that go into effect when model-year 2017 cars hit showroom floors.
The cost of the regulations is high, with critics arguing that the rules won't do much to keep the Earth's temperature from rising.
Other rules outside of the president's climate plan, such as those for smog-forming ozone emissions, have been criticized by business groups as the most costly regulations in history because of their potential far-reaching impact on cities' and regions' economic growth. But there is no government pricetag for the rules, because the EPA said in the final 2015 rule that it does not have to assess their cost.
Below is a list of seven of the most expensive rules that have been finalized under Obama's climate plan, even though court action has put some of the major moves on ice for now.
1. Vehicle rules, $156 billion
Is there a Prius in your future? Automakers hope there is, and the EPA is counting on it to meet its new fuel efficiency and emissions standards. But if you do buy into a hybrid-electric future, it is likely to cost you more, because the technologies needed to meet Obama's goals come at a premium.
As part of his Climate Action Plan, Obama wants passenger vehicles, from sport utility vehicles and pickup trucks to compact cars and convertibles, to emit less carbon dioxide, responding to what he describes as "the country's critical need to address global climate change and to reduce oil consumption." That comes at a total cost of $156 billion — on top of the previous $51.8 billion from earlier in his administration (more on this below).
Once implemented in the 2017 model year fleet, which will start hitting sales lots any day, the EPA rules will seek to reach emission reductions of 163 grams per mile of carbon dioxide (CO2) by 2025. That's equivalent to 54.5 miles per gallon if the reductions were achieved solely through improvements in fuel efficiency. The reductions would be met by hitting the per-gallon target by the time the program finishes in 2025.
The rules build on the first phase of the program, which applies to vehicle model-years 2012-16, and are key to meeting the country's obligations under the Paris climate change deal to stave off a global temperature rise of 2 degrees Celsius.
The auto rules for the first time include a "midterm review," which the automakers asked the EPA to include, to assess whether or not they can achieve the standard based on the level of technological advancement required and market factors, such as demand for fuel-efficient and electric cars.
The rule also lets auto manufacturers obtain bigger compliance credits based on the number of electric cars they build. The EPA believes more battery-electric cars will be needed to meet the emissions target over the next eight years. The rules are designed to encourage the quick adoption of low-emission electric cars, while making more hybrid designs available in larger gasoline-consuming vehicles such as pickup trucks.
The problem for the administration and automakers is that sales are weak for vehicles with higher fuel efficiency and lower emissions, as cheap gasoline drives consumers toward larger, gas-guzzling sport utility vehicles. And the automakers and the Energy Department have expressed concern about their ability to meet the targets.
2. 2012 auto rules, $51.8 billion
One of the costliest rules since 2009, the regulation was the first to combine the corporate average fuel-efficiency standard, known as the CAFE standards and measured in miles per gallon, with a greenhous-gas-reduction target measured in grams per mile.
Implemented for model year 2012, the rules sought to reduce carbon dioxide emissions from 326 grams per mile in 2011 to 250 grams in 2016. The fuel-efficiency equivalent is 34.1 miles per gallon fleet wide in model-year 2016 vehicles and is based on a 5 percent improvement for each vehicle year. The 2012-16 standards were meant to dovetail with the phase two standards applying to model-year 2017-25.
The 2012 rules introduced the first compliance credits for electric cars to encourage the commercialization of low-emission vehicles. It also continued credits for alternative fuel vehicles, or flex-fuel vehicles, that burn renewable fuel up to 85 percent ethanol. The ethanol vehicle credits have since been phased out.
The problem with incentivizing alternative-fueled vehicles, such as 85 percent ethanol flex-fuel cars, is accounting for fuel use. The cars can run on blends of 85 percent ethanol, but they can also run on regular gasoline. Since the greenhouse gas reductions that the EPA seeks are supposed to come from using the highest blend of biofuels, not being able to account for when 85 percent ethanol fuel is being used has become an issue.
Ford and GM make the most flex-fuel cars and had sought to keep the alternative fuel credit in the 2017-25 vehicle rules. But the EPA pulled back from the credits in favor of electric cars.
3. Refrigerators, $27.3 billion
Refrigerators are becoming more expensive. That's because manufacturers have been complying with new efficiency standards that are driving costs higher.
The rules went into effect in fall 2014 and will be entering the second year of implementation at the end of September.
The rules are seen as one of the costliest among the efficiency standards being established, based on its annual cost. Devised by the Energy Department, the rules were finalized in 2011 at a total cost of $27.3 billion, which comes to $1.6 billion annually.
The rules were developed to improve the efficiency of residential refrigerators, as part of the Obama administration's goal of reducing homeowners' demand for electricity and, hence, emissions. Less demand for electricity reduces the need for large, centralized coal plants and helps stabilize the power grid to help the transition to more solar and wind.
When the Energy Department finalized the standards, it called them "more stringent," but said they are technologically feasible and economically justified.
The efficiency standards are supposed to improve most parts and components of a home refrigerator, including the freezer, crisper drawers, etc. They don't apply to wine coolers, found in some models.
The industry had not had to comply with tighter efficiency rules since Bill Clinton's administration, when the Energy Department finalized an updated standard in 1997, using the authority it acquired under the Carter administration after the Arab oil embargo.
Appliance manufacturer General Electric and trade groups representing appliance manufacturers resisted the standards when they were proposed, saying the agency had not disclosed the basis for its conclusions, an issue the appliance industry is still facing with other rules.
The Energy Department says the standards will save about three times the total energy used each year for home refrigeration from 2014-43.
Meanwhile, the industry is expecting shortages of refrigeration chemicals called hydrofluorocarbons, or HFCs, as the EPA phases them out. The supply constraints will get worse as the agency continues to ratchet down the use of HFCs, which are commonly used in the air conditioners and refrigerators.
HFCs were phased in by the agency in the 1980s under a global compact to rid the world of other chemicals that were blamed for depleting the Earth's protective ozone layer. Now, the HFCs are being blamed for exacerbating global warming by increasing greenhouse gases that are blamed for causing the Earth's temperature to rise.
HFCs are a far more potent form of greenhouse gas than the more prevalent carbon dioxide. Eliminating the use of the chemicals is part of Obama's plan in his final year in office.
4. Coal ash rules, $23.2 billion
The Environmental Protection Agency's rules for disposing of coal ash — think of the pile of ash left in your barbecue grill, but a lot more toxic — is one of many expensive agency regulations for coal-fired power plants.
The rule was finalized in 2015, with an estimated total cost of $23.2 billion. The annual cost of the regulation is $509 million.
The EPA estimates the total annual compliance burden would cost utilities about 358,957 hours per year in document filings and dealing with other aspects of the bureaucracy. The total estimated burden over the three-year compliance window is 1.1 million hours.
Coal residuals are generated from burning coal to generate electricity. Some common types include fly ash, bottom ash, boiler slag and flue gas desulfurization waste. Over the last decade, new regulations for coal residuals have come into focus as a result of major spills of the waste, which is usually stored wet in large containment ponds.
The 2008 coal-ash containment pond spill at the Tennessee Valley Authority's Kingston Fossil Plant helped put coal waste on the map, with calls for the EPA to establish new regulations governing how the waste is stored. The accident spilled 1.1 billion gallons of coal-ash slurry and covered the surrounding area in 6 feet of the ashy sludge.
In early 2014, an estimated 39,000 tons of coal ash spilled from Duke Energy's Dan River Steam Station into the Dan River in Eden, N.C. The extent of the spill forced state regulators to ask the administration and the EPA for help in managing the response and cleanup.
The rules affect the owners and operators of coal waste containment facilities and landfills, requiring millions of dollars in construction costs and retrofitting to enable continued operation of the facilities.
The rules were labeled by the utility industry as part of a regulatory "train wreck," illustrating the increased burden of a major wave of regulations, which were all coming within a few years of each other.
5. Air conditioning, $15 billion
The Energy Department finalized energy conservation standards this year for commercial air conditioning and heating equipment at a total cost of $15 billion and annual cost of $711 million.
The standards require increased efficiency for large, commercial HVAC systems and have been a source of friction between the Energy Department and equipment manufacturers over the pace and stringency of the regulations.
The manufacturers say they face a suite of these type of regulations from the Energy Department, which wouldn't be such a big problem if they weren't being rushed out to meet the goals of the Climate Action Plan before Obama leaves office.
Instead, the slate of rules are "a huge problem," said Frank Stanonik, chief technical adviser for the Air-Conditioning, Heating and Refrigeration Institute.
The specific concern industry groups have is the manner in which the Energy Department is proposing the rules, which is based on withholding information until the rules are made final, rather than being inclusive about the methods it is using to devise the rule.
The agency "has a process rule that says they are supposed to finalize test procedures ... before they finalize rules," Stanonik said. He said it's a "significant issue" because it doesn't disclose the agency's thinking in devising the regulation until the rule is final. That places manufacturers at a disadvantage because they don't know what is coming.
The air conditioning rule, at least, was something the industry favored because the process included negotiations, Stanonik said. But for the most part, the Energy Department has taken a significantly different course that doesn't have broad buy-in.
"It certainly appears to us that there is a drive to get things done by the end of this year or by the end of this administration," said Stanonik. The test procedure issue "is a clear example of that."
It's an issue that the industry has taken to court, and likely will do so again.
Overall, the Energy Department has been moving quickly to propose and finalize new rules to drive greater efficiency into the electric system by shrinking demand, thereby using less power and cutting carbon dioxide emissions.
The air-conditioning rules by themselves would save 14.8 quadrillion British thermal units, or "quads," of energy through 2048, according to the agency. That means the new standards would raise efficiency by 24 percent. The rules also would reduce carbon dioxide, which would shrink the nation's impact on global warming, the agency says.
The regulations would result in greenhouse-gas-emission reductions of 873 million metric tons of carbon dioxide over 30 years, as well as significant reductions in standard pollutants such as sulfur dioxide, nitrogen oxides, methane, nitrous oxide and mercury.
The cumulative reduction in carbon emissions by 2030 would be 77 million metric tons, the equivalent of taking 10.6 million homes off the grid. The rules line up with the compliance period for the EPA's separate climate rules for power plants.
The climate change benefits of the rule were calculated using a controversial metric the Obama administration has applied for many of its regulations, called the social cost of carbon. The metric has sparked criticism from industry groups and congressional Republicans who say the administration has not been open about how it developed it.
The social cost of carbon equates carbon dioxide reductions to a monetary value, which then is applied to a cost-savings analysis to justify the rule. For heating and air conditioning, the Energy Department says the social cost is between $5 billion-$76 billion.
6. Fluorescent lights, $13.5 billion
These are the lights you see while walking through Wal-Mart or Costco or in your office, the long, tube-like glowsticks that provide much of the nation's artificial light.
Fluorescent lighting accounts for 60–70 percent of the total amount of electricity used for lighting in commercial and industrial buildings, according to the environmental coalition the Appliance Standard Awareness Project.
The Energy Department's stringent energy-conservation standards for the lights were finalized in 2015, costing $13.5 billion or $841 million a year. The standards require the output of more light from the lamps by using less electricity and consequently producing less heat.
The cost of the bulbs will certainly increase for consumers, but also for big box stores and, of course, the bulb manufacturers. The Obama administration sees the standards eating into profits, up to 21 percent, but not enough to cause factories to shutter and eliminate jobs.
The agency said the new standards will result in significant energy reductions, while being technologically feasible and economically justified.
The energy savings over the 30-year lifetime of installed light fixtures would amount to 2.5 quadrillion British thermal units, or quads. That represents a 7.1 percent improvement over current lamps.
The standards also would result in "significant environmental benefits," resulting in greenhouse-gas-emission reductions of about 160 million metric tons of carbon dioxide. It also would significantly reduce methane, which is a much more potent greenhouse gas than carbon dioxide.
"The cumulative reduction in CO2 emissions through 2030 amounts to 90 metric tons, which is equivalent to the emissions associated with annual electricity use of approximately 12 million homes," the Energy Department says.
7. Clean Power Plan, $11.9 billion
The Clean Power Plan is considered the centerpiece of President Obama's effort to battle climate change. And while it is the most publicized of all his actions, its cost, estimated by the EPA to be $11.9 billion, is a source of dispute.
Under the plan, states must cut their greenhouse gas emissions one-third by 2030. To do that, the EPA expects them to cut back on their use of coal-fired power plants.
It is expected that it will take state officials a total of 821,000 hours to file the paperwork to comply with the regulations.
Most of the cost will come in the several years leading up to the final compliance year in 2030, according to the EPA. States have two options for cutting emissions: by the rate of emissions or by a mass-based standard such as an emissions cap.
Under the agency's rate-based scenario, which is seen as the default for achieving the targets, it would cost states $8.4 billion a year to comply in 2030.
But the conservative American Action Forum, which has compiled the cost of all EPA rules, says the EPA's assessment of the Clean Power Plan is limited and conservative at best.
By adding the annualized cost estimated by the agency beginning in 2020 at $2.5 billion, before leveling to $1 billion for 2021-25, and then jumping to $8.4 billion in 2026-30, the total cost of the rule is $11.9 billion, based on the think tank's Regulation Rodeo database and the EPA's final rule.
The cost estimates for the years 2020, 2025 and 2030 are derived from the EPA's Integrated Planning Model, which provides one-year cost estimates in five-year increments, said EPA spokeswoman Melissa Harrison.
"This is a problem throughout the regulatory world, where there is not really a standard way to control for cost," said Sam Batkins, the group's regulatory policy director. For example, another expensive EPA rule for coal ash gives a total cost figure over the next 100 years, while the Energy Department provides a total cost over 30 years.
"In this particular rulemaking, EPA didn't give a net present value of cost, and all indications are this $11 billion figure is not going to be the total cost of the rule."
Batkins said that in other documents, the agency said that just one of the rule's "building blocks," which lay out the types of resources states can use to comply, could cost $30 billion.
Other ways exist to evaluate cost, he said. "There are industry costs that are much higher, and there are industry costs that are probably lower as well. Even within an agency you won't get a standard, with the exception of the Department of Energy, figure for [cost]," where the total cost and benefits of a regulation are broken down by year and made available to the public.
EPA cost figures should be looked at only as milestones that give an idea of what the cost would be, he said.
In fact, some industry studies suggest the Clean Power Plan could surpass the cost of all other major electric utility rules combined.
A study done by NERA Consulting for the coal industry shows that the annual cost of the rule could be $39 billion per year, "far outpacing the costs of compliance for all EPA rules for power plants in 2010 ($7 billion) and the annual cost of the Mercury and Air Toxics Standards rule ($10 billion)," the American Coalition for Clean Coal Electricity said.
The Congressional Research Service, the legislative branch's nonpartisan research arm, also looked at various industry reports that examine the cost of the rule in a guide to the Clean Power Plan it issued in June.
The guide cites the NERA study, but also a study by the National Mining Association that "projected sharp increases in the cost of both electricity and natural gas as a result of the rule, with a cumulative increase in wholesale electricity costs of $214 billion between 2022 and 2030."
"Others, including electric power producers and regional transmission organizations, argue that it is too early to arrive at cost estimates," the CRS guide said. "Much depends on decisions to be made by the states as to how they will structure their regulatory programs and on projections of the cost of natural gas, coal, renewable power and end-use efficiency measures between now and 2030."
The agency is encouraging states to use emissions trading schemes or participation in regional cap-and-trade programs to comply with the plan. The final rule also includes a clean energy incentive program, which provides states with special credits for ramping up renewable energy development before they must begin complying with the plan in 2022.
The plan has been put on hold by the Supreme Court until the D.C. Circuit Court of Appeals reviews lawsuits filed by dozens of states and industry groups. The challengers argue that it oversteps the EPA's legal authority under the Clean Air Act and is an unconstitutional power grab over states' rights to regulate their own energy supplies.
The appeals court is set to hear oral arguments on Sept. 27, and they will be heard by the entire court, instead of a normal three-judge panel. That is meant to expedite the hearing process and move the court to a final decision before the end of the year. After that, it is expected to go to the Supreme Court no matter what the judges decide.