The White House will finalize one of the most far-reaching regulations of the Obama administration Monday, a rule which will transform the way Americans receive their electricity, if it survives expected legal challenges.
The Environmental Protection Agency rule limiting carbon emissions from power plants, Obama's signature climate change policy, would require steeper greenhouse gas cuts than a version proposed in June 2014. It aims to curb electricity sector emissions nationwide 32 percent below 2005 levels by 2030, compared with the earlier version's 30-percent target.
The measure will be cheered by the president's supporters and those on the Left who say it's time for the president to address climate change in the face of GOP congressional opposition.
GOP and industry critics will deride the rule as an abuse of executive authority that threatens to hike energy costs and kill the coal industry. The rule, which would regulate carbon pollution for the first time, is likely to face immediate legal challenges from industry and red states.
"Even in the face of damning analyses and scathing opposition from across the country, EPA's final carbon rule reveals what we've said for months – this agency is pursuing an illegal plan that will drive up electricity costs and put people out of work," Mike Duncan, president of industry group American Coalition for Clean Coal Electricity, said in a statement.
Obama, who has increasingly come to view climate change as a legacy issue, called the regulation in a video posted on Facebook, "The biggest, most important step we've ever taken to combat climate change."
Changes between the draft and final version include a greater emphasis on renewable power, less reliance on energy efficiency, and more time for states to phase in emissions cuts, according to White House officials. It expects the average United States consumer will pay $85 less annually on electricity in 2030 as a result of the rule.
"The administration is doing what science and the law demand, and it's now up to the states. The smart ones will see this as an opportunity, not a threat – a chance to modernize their economies and energy infrastructure," Bob Perciasepe, a former EPA deputy administrator under Obama who now is president of the Center for Climate and Energy Solutions, said in a statement.
The White House says it will be easier to comply with the rule due to changes in the rule's structure and that there's less variation between individual state emission reduction targets. But administration officials declined to disclose any specific state goals or how they might have changed.
"The range between states will be much more narrow," EPA Administrator Gina McCarthy said during a Sunday conference call with reporters.
The Obama administration will attempt to sell skeptics on the plan and rally supporters in the coming weeks, viewing the rule as key for getting other nations to sign onto an international climate deal in late November negotiations in Paris. Congressional Republicans are trying to undermine the regulation and those talks.
Rather than require most of the emissions cuts to occur by 2020 as was proposed in the draft version, states would now have until 2022 to begin shifting their electricity systems away from more carbon-dense sources of emissions, like coal. States had complained that the earlier version resulted in a "regulatory cliff" that would have them shutter massive amounts of coal-fired electricity without enough generation sources to replace it.
Renewable power will play a much bigger role in satisfying the emissions targets for individual states compared with the proposed rule. States will receive extra credit toward complying with the rule for adding renewable energy in 2020 and 2021, helping incentivize early and more widespread adoption of zero-carbon energy sources, the White House said. If states take full advantage of the credits, renewable power would make up 28 percent of the electricity mix in 2030, compared with 22 percent under the earlier version.
States would also receive double the credit toward meeting emissions goals for undertaking energy efficiency measures for low-income residents in 2020 and 2021.
Compared with the proposed regulation released last summer, natural gas, which produces half the carbon emissions as coal in power generation, won't be as central a factor for satisfying emissions cuts. McCarthy said that's because the agency expects states will take advantage of the early credit for clean energy, thereby limiting the amount of new natural gas generation they'd need to add.
"I don't want you to get the impression that we are putting our finger on any type of energy generation," McCarthy said in response to a question about whether the administration was dropping its support of natural gas as a "bridge fuel" to zero-carbon energy sources.
McCarthy said expectations for the amount of renewable power states could add to their systems increased because the final rule views renewable potential on a regional scale, rather than by what states can achieve within their own borders. She said that alteration more closely resembles the interstate flow of electricity on the power grid.
The rule also would no longer call on emissions reductions customer-side energy efficiency — states can use energy efficiency programs to meet emissions cuts, but the final rule doesn't assume an average 1.5 percent efficiency improvement as in the draft form. Coal- and natural gas-fired generators will also be treated differently in terms of how utilities can boost energy efficiency within those power plants.
To address concerns about potential power blackouts as states implement changes, the rule also will add a "reliability safety valve" to ensure sufficient backup power exists as states transition their electricity systems.
In the new rule, states would be allowed to participate in marketplaces with each other to utilize energy efficiency and emissions trading schemes without signing interstate agreements. McCarthy said that the EPA would publish a model system for trading such services, but added that states could set up independent energy efficiency and emissions credit marketplaces that the EPA could monitor as a way to meet emissions goals.