Repealing the Clean Power Plan could backfire for coal

The coal industry celebrated last week, as Environmental Protection Agency Administrator Scott Pruitt announced plans to scrap the Clean Power Plan. However, the victory cheered today may pave the way to future woes.

When the Clean Power Plan was being formulated in 2014, the Energy Information Administration expected power plant carbon dioxide emissions would top 2.2 billion tons in 2030. That made the plan’s goal of cutting emissions to around 1.7 billion tons appear ambitious.

{mosads}But while the Plan languished in court, markets evolved without it. More efficient lights and appliances thwarted growth in power demand. Natural gas, wind and solar all became cheaper than expected, outcompeting coal. And dozens of coal plants closed due to unrelated air pollution rules in 2015. All of this pushed emissions down to 1.8 billion tons last year, just above the plan’s target over a decade ahead of schedule.

That doesn’t mean the Clean Power Plan is meaningless. The Plan’s limits were set state by state. Many states, including the 14 in the United States Climate Alliance, are already curbing their emissions more aggressively than the plan requires. By forcing other states to act too, the plan may have outperformed its nationwide goal.

But those impacts may have been modest. According to analysis by the Rhodium Group, low prices for natural gas and renewables could bring most states near their caps by market forces alone. State caps would have averted upticks in emissions if natural gas prices rise. That’s not nothing, but hardly lives up to the plan’s billing as a “climate game changer”, or an “unaffordable” threat to reliable energy.

Crucially, repeal must be followed by replace. That’s because Pruitt is not reversing EPA’s “endangerment finding” that climate-warming gases endanger public health and welfare. Most analysts expect courts would reject a reversal, since science makes clear that carbon dioxide is warming the planet. With the endangerment finding in place, EPA must act, based on the Supreme Court’s interpretation of the Clean Air Act in Massachusetts vs EPA.

If EPA must act, it will do so with emissions now 10 percent lower than it expected in 2014 and trending downward. Starting from this new normal, it will be hard to justify targets as weak as originally proposed. After all, a clean power plan should spur cleaner power, not just tally market-driven trends.

Pruitt has not yet proposed a replacement, other than to say that it will be sought “carefully, properly, and with humility.” That suggests the process could be dragged out for years.

Usually, delay is coal’s ally. To paraphrase John Maynard Keynes, in the long run coal is dead. No new coal power plants are being built in this country. Many of the remainders are several decades old, and struggling to compete with cleaner, cheaper alternatives. Delaying regulation lets the coal industry eke out a bit more profits before succumbing to market forces. But delay also exacerbates the damage coal causes to our health, environment and climate. Thus, timing is everything to all sides in the so-called war on coal.

Repeal and delay may help coal for now. But it leaves a policy void if a new administration arrives in 2021. Will the next administration really settle for something as weak and slow as a nearly-met Clean Power Plan? Does the industry want someone other than Pruitt to craft a replacement, or for EPA intransigence to spur more robust solutions from Congress?

Apparent blessings can be curses, and curses blessings. The repeal and delay cheered by the coal industry today could clear the way for far tougher policies in the next administration. That would be good news for the rest of us, as more vigorous action is needed to supplement market forces and accelerate progress on clean air and climate.

Daniel Cohan is associate professor of civil and environmental engineering at Rice University.