(Bloomberg) — President Barack Obama will issue a sweeping
set of regulations to cut U.S. power-plant emissions, the
biggest carbon-pollution control effort by the world’s biggest
economy that pressures other countries heading into global
climate talks in Paris later this year.
Obama’s Environmental Protection Agency on Monday will
finalize measures that force states and utilities to use less
coal and more wind power, solar and natural gas. The plan,
estimated to cost $8.4 billion, is expected to go into effect in
the next month or two but is likely to face a legal challenge
that could stall its implementation.
Taken with other measures to curb methane emissions, spur
private companies to use more renewable power and curtail the
use of climate-warming refrigerants, the measure will transform
how electricity has been produced in the U.S. for a century. It
puts the U.S. on the path to cut emissions by 26 percent to 28
percent by 2025, according to the White House. With the U.S.
moving, others may be more likely to follow, analysts say.
This “indicates that the world’s largest economy is
providing big regulatory incentives for clean energy and
penalizing fossil fuels,” said Paul Bledsoe, an energy expert
at the German Marshall Fund who served in President Bill
Clinton’s administration. “It’s that basic underlying economic
signal that tells governments around the world that it’s time to
The U.S., the world’s largest emitter of carbon dioxide
before China supplanted it in recent years, has never
implemented a global agreement to combat climate change.
Negotiators from 195 countries are working on a deal that will
bring about meaningful cuts by rich nations and the first caps
from countries such as China. Getting all the nations to agree
is one of the top priorities of the last 18 months of Obama’s
“It’s time for America, and the world, to act on climate
change,” Obama said in a video message released on the White
House Twitter feed.
The EPA plan is the centerpiece of Obama’s climate plan,
and a year after it was first proposed it’s set to be released
Monday. Obama will introduce it at a White House ceremony.
“For too long we’ve seen Washington, D.C., putting off and
delaying serious action” on climate change,’’ White House
spokesman Josh Earnest said in an interview on MSNBC Monday. “I
have no doubt that special interests in Washington, D.C., are
going to squeal, as are the politicians who are in their
The regulations are to take effect after publication in the
Federal Register, but they may be stalled if opponents ask for
stay while challenging in court.
According to documents released in advance, the final rule
aims to accomplish a 32 percent reduction in carbon emissions
from the nation’s power plants by 2030, compared with 2005
levels, against 30 percent in the EPA’s original 2014 proposal.
Emissions are already down 15 percent from that peak.
The plan will accomplish the rest in part by giving states
credit for solar or wind projects that break ground in the next
few years, before the rule takes effect in 2022. It will also
force utilities to run natural-gas plants more or encourage
customers to use less electricity.
Power generation, specifically burning coal to make
electricity, is the biggest source of carbon pollution in the
U.S. Until now there was no cap on those emissions.
“The way electricity is being produced is being
significantly transformed,” said Michael Brune, president of
the Sierra Club. “It will amount to a move away from fossil
fuels toward clean energy.”
Power plants burning coal produce almost 40 percent of the
nation’s electricity, down from about half just a few years ago.
That’s forecast to decline to 27 percent by 2030 under these new
The general EPA plan is a set of targets for states. Each
will have to submit plans to the agency by 2018 — two years
later than called for in last year’s draft — on how it will
achieve the EPA-mandated goal. The targets will phase in between
2022 and 2030.
The EPA’s initial proposal would have forced states with a
lot of natural-gas plants, such as Arizona, to make cuts in
emissions of more than 50 percent by 2030. Meanwhile, coal-heavy
states including Kentucky, West Virginia, Wyoming and Montana
faced cuts of 21 percent or less.
The EPA tweaked its forecasts for the amount of natural-gas
and renewable-energy growth it estimates can be accomplished in
“At the end of the day, you will see state goals more
uniform,” said Brian Deese, a White House adviser on energy and
The White House says that while it’s backing off on an
initial deadline for the rule and making other changes to help
states, the final plan will lead to more reductions in
greenhouse gases because it will boost carbon-free energy and
rely less on switching from coal to natural gas. The incentive
plan will also reward states that submit plans to the White
“In today’s marketplace their best compliance option is
clearly solar,” Rick Umoff, counsel for the Washington-based
Solar Energy Industries Association, said in an e-mail. A more
flexible timeline under the plan “will only further encourage
states to act early so they can take advantage of the booming
solar economy and any compliance incentives that the EPA might
Democratic presidential candidate Hillary Clinton said the
plan is “a significant step forward” in meeting the threat of
Coal producers are not as happy.
“EPA’s final Clean Power Plan reflects political
expediency, not reality for supplying the nation with low cost
reliable power,” said Hal Quinn, president of the National
Mining Association. On Monday, the group will file a stay to try
to stop the plan from going into effect, he said.
The regulation is also expected to face lawsuits from coal-dependent states, coal producers and some utilities or power
cooperatives. They argue that the EPA is exceeding its authority
and forcing a reorganization of power generation for which it
doesn’t have the legal mandate.
Those legal challenges may mean the rule never takes
effect, Senate Majority Leader Mitch McConnell, a Kentucky
Republican, warned the U.S. negotiating partners earlier this
“Even if the job-killing and likely illegal Clean Power
Plan were fully implemented, the United States could not meet
the targets laid out in this proposed new plan,” he said in a
statement March 31. “Our international partners should proceed
with caution before entering into a binding, unattainable
To contact the reporters on this story:
Mark Drajem in Washington at
Alex Nussbaum in New York at
To contact the editors responsible for this story:
Jon Morgan at
Elizabeth Wasserman, Steve Geimann