In 2015, EPA proposed a rule requiring states to develop plans to cut CO2 emissions from the power sector—the Clean Power Plan (“CPP”). EPA explained the rule would result in “significant emission reductions” for that sector, from about 2,650 million tons in 2005, to 1,900 million tons in 2022, and 1,800 million tons in 2030–a 32% reduction in emissions below 2005 levels. 80 Fed. Reg. at 65,041 (Oct. 23, 2015).
Two years later, in denying petitions to reconsider and stay the final CPP rule, EPA explained that “sources covered by the CPP are well on their way toward meeting the[se] carbon dioxide (CO2) emission reductions.” By the end of 2015 (several months after the CPP was finalized), EPA reported, the power sector had already reduced CO2 emissions 24% below 2005 levels. This, EPA said, demonstrated that states and sources were well on their way to achieving the CPP a full 5 years before the program would even impose compliance obligations (i.e., in 2022). EPA, Basis for Denial of Petitions to Reconsider and Petitions to Stay Clean Power Plan (January 17, 2017), Appendix 2, pp. 4-5.
Of course, SCOTUS stayed the CPP, the first Trump Administration repealed the rule, and then issued the Affordable Clean Energy Rule (“ACE”) rule in its place. The DC Circuit struck down the ACE rule, that decision was reversed by SCOTUS, and the Biden Administration proposed a new rule replacing both ACE and CPP—what some have called “CPP 2.0.” Once again, EPA emphasized that “if finalized, [the rule] would significantly decrease GHG emission from fossil fuel-fired EGUs.” 88 Fed. Reg. at 33,243 (May 23, 2023). Not surprisingly, the final rule was challenged in the D.C. Circuit with petitions to SCOTUS expected regardless of outcome.
What’s happened with power sector CO2 emissions in the interim? Interestingly, the Regulatory Impact Analysis (“RIA”) for CPP 2.0 reports power sector CO2 emissions in 2022 at 1,539 million tons—well below the 2030 emissions level forecast under the original CPP. The RIA then forecasts that, with or without the rule, power sector CO2 emissions would drop by roughly 80% from 2005 levels by 2040–to 608 million tons in 2035 and 481 million tons in 2040 without the rule, and to 572 million tons in 2035 and 458 million tons in 2040 with the rule.
And now the wheel turns again. An Executive Order issued on the first day of the new Administration–Unleashing American Energy–directs EPA to review and undo actions that impede the energy economy. CPP 2.0 is likely due for repeal and revision with more litigation to come. But does it matter?
When I think about the resources spent on rulemaking, litigation, state plan development, and related controversy under successive rules over the past decade, and compare that with where we are now and where we’re projected to be on CO2 emission for the power sector, I wonder. This country is in the midst of an energy transition that is driving CO2 emissions lower. That transition will not follow a straight line, because it will be impacted by changing electricity demand (including the growth of data centers, AI and EVs), changing energy policies, and the deployment of new technologies. But so far, CO2 emissions from this sector have continued to decline quite dramatically. Perhaps the commitments that have been made to the new energy economy are indeed quite “sticky” and we should provide incentives to reinforce them rather than dictate emission control technologies.
