How much can the EPA cut carbon emissions? It depends on the courts.

December 7, 2012

Congress isn't likely to do much about global warming anytime soon. So if the Obama administration wants to set a national policy on greenhouse-gas emissions, it will have to lean on the Environmental Protection Agency. 


Really running out of climate change related stock art here... (Poster by Katie Moser, a sixth-grader in Anne Arundel County.)

In theory, there's a lot the EPA can do here. Thanks to a 2007 Supreme Court decision, the agency was given broad authority to regulate carbon dioxide under the Clean Air Act. And many environmentalists are already coming up with creative ways for the EPA to follow through.

This week, for instance, the Natural Resources Defense Council released a plan for the EPA to reduce carbon-dioxide from all existing power plants by setting flexible state-level targets. In the best case, this move could cut U.S. emissions some 10 percent.

But is this plan actually feasible? Over at Resources for the Future, Nathan Richardson explains in detail why the courts might be skeptical about the NRDC proposal. Here's the short summary:

The Clean Air Act gives EPA a lot of flexibility. The agency explicitly has control over how broad or narrow to draw the “source categories” for which it sets emissions standards. And “performance standards” is thinly defined. The prevailing view is that the agency could use flexible tools, including averaging, banking, and trading, as part of these standards.

But there are still limits. EPA can’t call the whole electric power sector a “source category” and by doing so give itself carte blanche to set energy policy. NRDC’s proposal doesn’t do this – but it comes close.

Let's unpack this a bit. Under the Natural Resource Defense Council's proposal to cut emissions, the EPA would set emissions targets for each state. Utilities and regulators could figure out the best way to bring their average emission rates down to the target. They could curb pollution at their coal plants. Or they could get credit for adding renewable power or by eliminating energy waste from their customers.

The first move is no problem — curbing pollution is how power plants have always met Clean Air Act rules. But what happens if a utility purchases more renewable energy as a way of "offsetting" its own pollution? As Richardson says, this is uncharted territory, and it's unclear whether the courts would strike this down or not.

It would be easy for the EPA to devise a carbon policy for power plants that was fairly uncontroversial—the agency would just require small emissions cuts at coal power plants via standard techniques, such as biomass co-firing or improved efficiency. But this would only be a small tweak. Bigger, more ambitious cuts would take some creativity. But more ambitious plans also run the risk of getting struck down.

That's just another way of saying that it would be easier to design a climate policy if Congress did it. After all, the EPA has to rely on the Clean Air Act, which was written long before global warming became a pressing concern and may not be the best possible tool for the job. But, at the moment, the EPA is all there really is.

Related: How to cut U.S. carbon emissions by 10 percent -- without Congress.

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Sarah Kliff · December 7, 2012