The Clean Power Plan's largest obstacle is how its cost is distributed disproportionately among the states.
David Bellman is Founder and Principal for All Energy Consulting. Contact him at email@example.com.
The largest obstacle looming within the Clean Power Plan proposed in June by the U.S. Environmental Protection Agency (EPA) will not be the overall cost of the program, but how that cost is distributed disproportionately among the states. As a nation, the overall impact may not seem large for many. But in some states, it will severely alter the current economic surroundings. This plan becomes a test of the federal power versus states' rights. Using EPA's supplied analysis and our advanced highly sophisticated power market models, we will demonstrate that the cost of the plan is more onerous in some states than others.
On June 2, 2014, the U.S. EPA proposed rules to reduce CO2 emissions from existing power plants through Section 111(d) of the Clean Air Act (CAA). The rule is also commonly called the "Clean Power Plan." There are some key nuances that should be immediately understood.
The proposed rule covers existing power plants only - meaning that new units built would not be impacted by this ruling. The new plants are subject to 111(d), which essentially supports building natural gas combined-cycle plants. Given that EPA is targeting only existing units, it is proposing a state-by-state rate target, or pounds of CO2 per MWh.