EPA repeals and replaces power plant CO2 rule

The US Environmental Protection Agency (EPA) today repealed the centerpiece of former president Barack Obama's efforts to cut CO2 emissions from power plants, putting in its place a scaled-back regulation the agency says will give states greater flexibility and allow coal to remain a key part of the country's power mix.

The agency formally ended the Obama-era Clean Power Plan while finalizing its replacement, the Affordable Clean Energy (ACE) rule. EPA says the two moves will serve rein in the previous administration's regulatory overreach while continuing to reduce emissions from power plants.

"ACE will continue our nation's environmental progress and it will do so legally and with proper respects for the states," Wheeler said as he announced the agency's actions in front of an audience of Trump administration officials, members of Congress and coal miners

The final ACE rule mirrors the proposal EPA put out last year. It relies on encouraging heat-rate improvements to cut CO2 emissions from coal-fired plants, rather than the broader suite of measures, including emissions trading, the Clean Power Plan would have allowed. It also gives states significant flexibility in determining where to set standards for each coal unit, taking into account factors such as how much longer a generator may be in operation.

Wheeler said the final rule will lead to a 35pc reduction in power plant CO2 emissions, although most of that decline is already baked into the power grid, given the falling use of coal and increases in natural gas and renewables in the US. EPA has previously projected that ACE rule on its own would cut emissions by just 1.5pc from expected levels.

The additional reductions may not be seen for some time. EPA plans to give states three years to submit their compliance plans and then the agency will take another year to finalize them.

The opponents of the Obama-era regulation, ranging from US industry groups to major coal states, applauded EPA's repeal of the Clean Power Plan.

"President Trump has been a friend of our state, and of coal, and the Affordable Clean Energy rule allows our state the autonomy to regulate energy and air quality without much of the unlawful federal overreach of the so-called Clean Power Plan," West Virginia attorney general Patrick Morrisey (R) said.

Morrisey led 27 states in challenging the Clean Power Plan in 2015, ultimately leading the US Supreme Court to put the regulation on hold while the DC Circuit Court of Appeals considered its legality. The appeals court has yet to issue a decision.

The new regulation, and the Clean Power Plan repeal, will be considered by the DC Circuit in the near future. Opponents, including a host of environmental groups and states, are already promising to challenge the legality of EPA's actions.

New York attorney general Letitia James (D) called the ACE rule "a clear violation of the Clean Air Act."