The Obama administration finalized the centerpiece of President Obama's climate change agenda Monday, a move that invites significant changes to how Americans get electricity. It also sounds the starting gun on political squabbles over the future of the U.S. energy landscape, legal fights, climate policy and the country's role in international climate negotiations set to begin in November in Paris.
The regulation also will affect the average American. The Obama administration contends it will carry significant health benefits by taking older, dirtier coal-fired power plants offline, helping to avoid 3,600 premature deaths and 90,000 asthma attacks in children by the time it is fully implemented. But opponents of the rule say those figures are bogus and believe the real pain will come from potential power price increases.
Here are seven things that people should know about the power plant regulation:
What is the Clean Power Plan?
It's an Environmental Protection Agency regulation that would set the first-ever carbon emissions limits for power plants. The goal is to reduce carbon dioxide in the power sector, which largely will be accomplished by reducing coal's share of the electricity pie. Today it provides 39 percent of the nation's power, but the EPA predicts it will supply 27 percent because of the rule and a mixture of market forces such as competition from natural gas. Most climate scientists say carbon dioxide is more responsible for warming the planet than any other greenhouse gas in the electricity system.
Will it raise electricity prices?
Prices, yes. Bills, perhaps not. The EPA says consumers would save $85 annually in power costs by 2030, largely through improvements in energy efficiency that would result in less power consumption. But the agency does predict the rates customers pay will increase by as much as 3 percent in 2020 compared with a business-as-usual scenario, though power prices in 2030 would be 1 percent higher or flat under two different schemes. The effect on prices likely won't be uniform across the country. States that have more coal-fired power to replace would likely see steeper increases, at least at first.
Will it cause blackouts?
Rule proponents say it won't, but some states and power industry groups contend it would. The EPA tried to address those fears by including a new feature called a "reliability safety valve." The idea is that in states where a major transition is required — say, by quickly shuttering large amounts of coal-fired power plants before new sources are built — grid operators could run a power plant if there is a shortage of power needed to meet demand, even if doing so would conflict with meeting the emission goals.
What do the states have to do?
States have until September 2018 to submit their plans to the EPA for complying with the regulation. Each state has a different target for reducing its power sector's emissions. There is no prescription for slashing emissions — states and electric utilities can choose to emphasize energy efficiency programs, purchase and contract for more renewable energy, add natural gas-fired power or participate in credit-trading programs to achieve their goals.
Will I have to buy solar panels?
No. While renewable power is a big part of the plan — the EPA says it would account for 28 percent of electricity resources by 2030 under the rule — there are no mandates for individuals. While homeowners might not hook up rooftop solar systems, it's possible the power they get from their electric utility will be from solar as electric companies consider purchasing or operating new sources of energy to comply with the rule. Utility-scale solar power, for example, is the fastest-growing sector of the solar industry, according to the Solar Energy Industries Association.
What if the states don't comply?
States don't have to submit a plan to comply, but then the EPA can enforce a federal plan. Some state governors have threatened that they won't follow the rule because they think it's illegal and that it will be too costly to implement. But experts contend that a federal plan would force power prices even higher because it won't be tailored to individual states' needs.
Why do opponents say it is illegal?
This is the first major regulation the EPA has issued under a particular section of the Clean Air Act so there is little case law from which to draw. One of the main contentions is what the Clean Air Act means when it says the EPA should use the "best system of emission reduction" to regulate pollutants. The energy industry and Republicans say that means the EPA can regulate only individual smokestacks. But the Obama administration and environmental groups say the entire electric grid infrastructure that brings power from generators into homes is the system in question, so they say it's fair game for the EPA to call on states to add renewable power or boost energy efficiency.
Another argument, however, is that a separate regulation that limits mercury emissions from power plants that already is on the books prevents the EPA from regulating the sector again under the section of the Clean Air Act that it used in crafting the carbon emission rule. That scenario is in limbo right now, as a federal court is reviewing whether the mercury rule is legal after the Supreme Court remanded it in June because it said the EPA didn't properly consider costs. If the federal court strikes down the mercury rule, then this line of attack for carbon rule opponents disappears.