How to cut U.S. carbon emissions by 10 percent — without Congress

December 4, 2012

 President Obama and his advisers keep suggesting that they'd like to do more about climate change, but Congress just won't cooperate. 


Now what about a slightly more efficient model? (Elise Amendola/AP)

Now one environmental group is arguing that the Obama administration doesn't even need Congress to make sweeping cuts to U.S. carbon emissions. On Tuesday, the Natural Resources Defense Council released a new report explaining how the Environmental Protection Agency  could enforce sharp emissions cuts at America's power plants. In the best case, the group said, the United States could reduce its overall climate pollution 10 percent by 2020 — and at relatively low cost.

Here's how this would work: Thanks to a 2007 Supreme Court decision, the EPA already has the authority to use the Clean Air Act to regulate carbon-dioxide, which causes global warming. So far, the agency has used that power to craft new fuel-economy standards for cars and light trucks, as well as to impose strict carbon limits on any future power plants that get built.

But the next step, the report says, is to cut emissions from existing plants. There are a number of ways to do this. The EPA could set a flat carbon standard for every power plant in the country, but this would be clumsy. For one, it would disproportionately hurt states that have lots of coal plants, such as Indiana or Ohio. What's more, it's hard to find a single one-size-fits-all rule. Either the EPA could ask for minor efficiency tweaks, or it could set a stringent standard that causes all coal plants to shut down. There's no real middle ground.

For those reasons, the Natural Resources Defense Council report advocates a more creative approach. The EPA would set different overall emissions goals for each state, depending on each state's existing energy mix. Coal-heavy Indiana would have a different target than renewable-rich Iowa. At that point, regulators and utilities in each state could figure out for themselves how best to meet the targets.

An electric utility could use a mix of strategies across different plants to stay below the average carbon-dioxide-per-megawatt-hour limit. The utility could make some power plants more efficient. It could run its dirtiest coal plants for fewer hours each day. It could invest more in renewable sources like wind and solar. It could come up with programs to trim wasteful energy use. The response is up to the companies. Whatever they think is best.

Meanwhile, if states wanted to come up with their own innovative policies for curtailing emissions—such as allowing utilities to trade pollution credits—that would be fine, too, so long as they met the EPA's overall carbon targets.

The Natural Resources Defense Council hired a widely used energy-modeling firm to figure out what this strategy could achieve. If the EPA's standards were ambitious, they could curtail emissions from U.S. power plants by up to 40 percent. That amounts to a 10 percent overall cut in the country's emissions. When combined with some of the other actions the United States is taking, the country could get pretty close to its climate goals, as the following chart shows.

Then there are the costs. Because this is a fairly flexible program—the EPA isn't requiring companies to adopt any specific technologies—the energy modeling suggests that the program would be cheaper than other approaches. It would cost just $4 billion per year while generating benefits of between $40 billion and $60 billion from the reduction of carbon-dioxide, sulfur-dioxide and nitrogen oxides. (Presumably, industry groups will dispute these figures once they have time to mull over the proposal.)

So how realistic is this? The lawyers at the National Resources Defense Council say that it's all quite legal under section 111(d) of the Clean Air Act, which allows the EPA to regulate existing sources. But this is fairly unprecedented territory, and if the agency took this step it would almost certainly get litigated in courts.

Now, the Obama administration isn't necessarily planning to follow this exact proposal. Yet right now, the EPA is pondering how and whether to regulate carbon-dioxide from power plants and other stationary sources of pollution. Green groups are pushing the EPA to get creative in its approach. This report can be seen as the start of that lobbying push.

Further reading:

--Here's the full Natural Resources Defense Council report and here's a shorter policy brief.

--Dave Roberts of Grist has even more detail on the NRDC proposal. He also notes that the EPA could conceivably go even further than this, though that's unlikely.

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