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The US Environmental Protection Agency (EPA) is currently accepting comments on a proposed new rule to set more stringent greenhouse emission limits on certain fossil fuel powered power plants.

The rule, promulgated under the legislative purview of s. 111 of the Clean Air Act (CAA), is concisely entitled “New Source Performance Standards for Greenhouse Gas Emissions from New, Modified, and Reconstructed Fossil Fuel-Fired Electric Generating Units (EGUs); Emission Guidelines for Greenhouse Gas Emissions from Existing Fossil Fuel-Fired EGUs”. Its initial notice was signed on May 8th by EPA Administrator Michael S. Regan.

If accepted in its current form, the rule may require coal and gas-fired power plants, both new and old, to use carbon and capture sequestration (CCS) and hydrogen-fueled generation technologies to reduce emissions and achieve an up-to 90% CO2 capture rate by 2035 (for natural gas plants) or 2040 (for existing coal plants scheduled to operate past that date).

A revised EPA emission standards regime has been expected since a 2021 D.C. Court of Appeals decision struck down the watered-down Trump-era Affordable Clean Energy rule as being in violation of the CAA.

However, even though - as Bloomberg reports - the plan targets “less than a fifth of US natural gas-based power generating capacity,” provides generous time limits for implementation (the more stringent requirements do not come into force until 2032), and allows for considerable flexibility in how emission reductions are to be achieved, the new rule should expect its own legal contests.

The US Supreme Court, currently dominated 6-3 by conservative Republican appointees, has already proven willing and able to interfere with long-established limits on EPA’s authority to regulate carbon emissions under the CAA.

In West Virginia v EPA (which we discussed here), the court held that a requirement to switch electricity-generation from fossil fuels to renewable sources was outside the EPA’s power to set emission standards based on the “best system of emission reduction” under section 111 of the CAA. The court’s majority interpreted the EPA’s power under section 111 as being confined to setting requirements for “best systems” that can be implemented by individual power plants, rather than those that necessitate re-organizing the electric power industry as a whole.

The EPA’s new proposals appear designed to comply with this constraint, relying heavily on the aforementioned new technologies, such as CSS, that individual plants can employ to achieve the required reductions in emissions.

Unfortunately, these technologies are not yet in widespread commercial use – a point that opponents of the proposed rule can seize upon to challenge its legality under section 111, which requires “best systems” to be “adequately demonstrated.” Whether the new rule can survive a legal challenge before the Supreme Court might therefore turn on the reliability of the EPA’s prediction that these technologies will be commercially viable by 2030 – the date that the first of the new emission standards are set to take effect.

A web page summarizing the proposals, along with a number of explanatory fact sheets and links to informational webinars to be held in early June, is available here.

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