59–010 

Calendar No. 283 

114TH CONGRESS REPORT " ! SENATE 1st Session 114–159 

AFFORDABLE RELIABLE ELECTRICITY NOW ACT OF 2015 

OCTOBER 29, 2015.—Ordered to be printed 

Mr. INHOFE, from the Committee on Environment and Public 

Works, submitted the following 

R E P O R T 

together with 

MINORITY VIEWS 

[To accompany S. 1324] 

[Including cost estimate of the Congressional Budget Office] 

The Committee on Environment and Public Works, to which was 

referred the bill (S. 1324) to require the Administrator of the Environmental Protection Agency to fulfill certain requirements before 

regulating standards of performance for new, modified, reconstructed fossil fuel-fired electric utility generating units, and for 

other purposes, having considered the same, reports favorably 

thereon without amendment and recommends that the bill do pass. 

GENERAL STATEMENT AND BACKGROUND

On June 25, 2013, President Obama announced his ‘‘Climate Action Plan’’ which provided three main categories of action: cut carbon emissions in America, prepare the U.S. for the impacts of climate change, and lead international efforts to address global climate change. As a part to this plan, the President issued an Executive Order directing the EPA to set standards of emissions reductions for new and existing fossil fuel-fired power plants. 

New Source Performance Standard: On September 20, 2013, the 

EPA re-proposed CO2 emissions limits for new power plants. The 

proposal, entitled ‘‘Standards of Performance for Greenhouse Gas 

Emissions for New Stationary Sources: Electric Utility Generation 


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Units’’ would limit emissions from coal-fired power plants to 1,100 

pounds (lbs) of CO2 per mega-watt hour (MWh) and either 1,000 

or 1,100 lbs per MWh at natural gas-fired power plants. The average coal plant emits 2,249 lbs of CO2 per MWh. 

The proposed New Source Performance Standard (NSPS) was 

published in the Federal Register January 8, 2014, and had a 120- 

day comment period. EPA received around 2 million comments and 

missed the finalization deadline, which was January 8, 2015. EPA 

issued a press release stating the agency planned to finalize the 

NSPS rule by ‘‘mid-summer.’’ 

Existing Source Performance Standard: On June 2, 2014, the 

EPA proposed a rule to limit CO2 emissions from existing power 

plants, entitled ‘‘Emission Guidelines for Existing Stationary 

Sources: Electric Generating Units,’’ referred to by the agency as 

the ‘‘Clean Power Plan.’’ The proposal set emission rate targets 

each state would be required to meet in an interim period from 

2020 to 2029 and a final target to be met by 2030. Using 2012 CO2

emissions as a baseline, the proposal’s stated goal was to reduce 

U.S. greenhouse gas (GHG) emissions by 30% when compared to 

2005 levels. 

The EPA calculated a state’s emissions reduction target based on 

4 main assumptions, referred to by the agency as ‘‘building blocks,’’ 

that ranged from heat-rate efficiency improvements to expansion of 

certain low and zero-emitting power sources, primarily renewables, 

to demand-side efficiency programs. EPA proposed to give states a 

one-year deadline to submit implementation plans with a possible 

one or two year extension. 

The agency held a 165-day comment period for the proposed Existing Source Performance Standard (ESPS), which received over 4 

million public comments. On January 7, 2015, EPA announced it 

would publish the existing plant final rule by ‘‘midsummer’’ along 

with the new plant final rule and a model Federal Implementation 

Plan (FIP). 

Modified and Reconstructed Sources: On June 2, 2014, the EPA 

also announced a proposal to limit CO2 from modified and reconstructed power plants. The proposal sets the qualifying standards 

by which any qualifying modification or reconstruction made at an 

existing plant would require compliance with an emission standard 

based on a combination of best operating practices and equipment 

upgrades. After a 120-day comment period, the proposal received 

235 public comments. 

Final Carbon Rules: On August 3, 2015, the EPA announced a 

prepublication version of the final carbon standards for new, modified, reconstructed, and existing power plants. While the final 

rules, and primarily the existing source standard, represent a significant revision of the proposed rules, many of the technical, legal 

and procedural concerns remain. Further, the agency has announced it will not formally publish the final rules until ‘‘mid to 

late October’’ delaying both legal and certain legislative challenges. 

Stakeholder Concerns and Legal Status of Carbon Rules: The 

agency has embarked on an unprecedented misuse of the Clean Air 

Act (CAA) to perpetuate a presidential agenda that could not be 

achieved legislatively. The agency attempts to use creative legal arguments that would vastly expand EPA’s authority under section 

111 of the CAA. A diverse and expansive list of impacted stakeVerDate Sep 11 2014 06:23 Oct 31, 2015 Jkt 059010 PO 00000 Frm 00002 Fmt 6659 Sfmt 6602 E:\HR\OC\SR159.XXX SR159

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holders has expressed serious concerns over the proposed and final 

carbon rules. These concerns have led to multiple legal challenges 

at both the state and federal level that raise basic technical concerns and questions regarding procedural integrity of our regulatory system. 

The New Source Proposal. To comply with the proposed and final 

carbon standard, a newly constructed coal-fired power plant would 

have to install carbon capture and storage (CCS) technology. CCS 

is in the early stages of development and has yet to be proven on 

a commercial scale. Given the infancy of CCS technology, the agency failed to meet basic legal standards required under section 111— 

that the system of emission reduction be ‘‘adequately demonstrated.’’ 

Counter to restrictions in the Energy Policy Act of 2005, the 

agency cites three U.S. CCS projects heavily reliant on government 

support through the Department of Energy’s Clean Coal Power Initiative as proof that CCS is a demonstrated technology. Because of 

the government support, these projects cannot be used to make 

that demonstration. Further, since the new source standard was 

initially proposed, only one of the three U.S.-based projects continues today after DOE decided to pull support from the California 

and Illinois projects. 

Beyond legal obstacles, numerous technical experts agree CCS is 

neither technically feasible nor viable. Many experts have testified 

before House and Senate committees, including an October 2013 

hearing before the House Committee on Science, Space, and Technology where DOE’s former Assistant Secretary for Fossil Energy, 

Charles D. McConnell, testified that ‘‘it is disingenuous to state 

that the technology is ready.’’ In January 2015, the National Coal 

Council released a study assessing the state of CCS in response to 

a request from DOE Secretary Moniz. The study concluded that 

‘‘the DOE CCS/CCUS program has not yet achieved critical mass’’ 

and ‘‘without adequate demonstration there can be no commercialization.’’ Requiring use of a technology that is not available 

amounts to a de facto ban on new coal plant construction in the 

U.S. 

The Existing Source Standard: Given significant legal concerns 

raised by the proposed and now final rule, the existing source 

standard has been subject to numerous challenges. A basic threshold issue is whether EPA has authority to proceed with the rules 

under Section 111(d) at all. Per the express language of the U.S. 

Code, EPA is precluded from regulating existing power plants 

under Section 111 because they are already subject to the EPA’s 

Mercury and Air Toxics Standard under section 112. 

EPA’s existing source standard is also counter to the limited historic application of authority under 111(d). Since the establishment 

of the CAA, section 111 has only been successfully used five times. 

Previous uses assigned emission reduction responsibility to a specified source. In contrast, under the power plant existing source 

standard, the agency attempts a drastic expansion of authority ‘‘beyond the source’’ or ‘‘beyond the fence-line’’ resulting in federal regulatory control over energy generation, dispatch and use. 

The rule intrudes on state authority and undermines the concept 

of cooperative federalism whereby states and the federal government are meant to work as partners to achieve environmental obVerDate Sep 11 2014 06:23 Oct 31, 2015 Jkt 059010 PO 00000 Frm 00003 Fmt 6659 Sfmt 6602 E:\HR\OC\SR159.XXX SR159

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1 NERA Economic Consulting, ‘‘Potential Energy Impacts of the EPA Proposed Clean Power 

Plan,’’ October 2014 available at http://www.nera.com/content/dam/nera/publications/2014/ 

NERA_ACCCE_CPP_Final_10.17.2014.pdf 2See Testimony of Eugene Trisko, available at http://www.epw.senate.gov/public/Öcache/files/ 

4204e97b-87b8-4629-ab45-ac55d475fd36/spw-062315.pdf 3 Id. 

jectives. Per the Federal Power Act, states have exclusive jurisdiction over intrastate electricity matters. Under the existing source 

rule, the EPA is attempting to regulate a state’s entire electricity 

industry, from generation to consumption, thereby undermining the 

states longstanding autonomy over such matters. If a state chooses 

to submit a State Implementation Plan (SIP) it would cede to EPA 

approval authority over matters traditionally set by state legislatures, including renewable portfolio standards, building codes, and 

energy efficiency standards. Such actions raise additional questions 

about how EPA plans to enforce plans that address areas where 

EPA lacks institutional expertise and legal authority. In addition 

to state intrusion, the existing source standard potentially complicates the prerogatives of the Federal Energy Regulatory Commission (FERC), which is charged with primary regulatory jurisdiction over the interstate transmission of electricity. 

Beyond the legal arguments, technical experts at the local and 

state level have expressed concerns over the practical application 

of the existing source standard. Compliance would force a rapid 

and unnatural restructuring of local energy systems undermining 

grid reliability at exorbitant costs. A significant amount of existing 

coal-fired generation would be shut down. Separate analyses by the 

EPA and the Energy Information Administration estimate fifty 

gigawatts would retire, with the majority of retirements occurring 

well before the 2030 final deadline. Of further concern in both the 

proposed and final versions of the rule is that this massive reduction in reliable electricity generation is expected to largely be replaced by intermittent renewable generation, like wind. During the 

proposed version’s comment period, numerous stakeholders raised 

concerns about reliability including the Southwest Power Pool, 

which warned the rule would cause ‘‘cascading outages’’ and ‘‘voltage collapse.’’ 

Alongside reduced reliability, the existing source standard comes 

at a high compliance cost and will increase the price of electricity. 

In the proposed version, EPA estimated costs to range from $5.5 

billion to $8.8 with a four to seven percent increase in retail electricity prices on average. Other estimates place costs at a much 

higher range of $366 to $479 billion with double digit electricity 

price increases occurring in over 43 states.1

Committee experts testified that such increases would be especially harmful to low and fixed-income households that already 

spend a larger portion of their household budgets on energy costs.2

Various analyses and surveys have found that in the face of increased energy costs, these household make decisions adverse to 

their own health and welfare including foregoing food, prescription 

use and medical care.3 At a hearing before the Clean Air and Nuclear Safety Subcommittee on June 23, 2015, the President of the 

Black Chamber of Commerce also testified that increased energy 

costs are particularly harmful to minority communities. The existing source rule alone would increase Black poverty by 23% and increase Hispanic poverty by 26%. Unemployment rates of Blacks 


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4 American Coalition for Clean Coal Electricity, ‘‘Climate Effects of EPA’s Proposed Carbon 

Regulations,’’ June 2014, available at: http://www.americaspower.org/sites/default/files/ 

Climate%20Effects%20Issue%20Paper%20June%202014.pdf 5 American Coalition for Clean Coal Electricity, ‘‘Climate Effects of EPA’s Final Clean Power 

Plan,’’ August 2015, available at: http://americaspower.org/sites/default/files/Climate-EffectsPaper-August-6-2015.pdf 6See Testimony of Stephen Eule on behalf of the U.S. Chamber, June 2015 available at 

https://www.uschamber.com/sites/default/files/150624_steveeule_ testimony_eia_analysis_ 

of_epa_clean_power_plan_house_science_sbcmt.pdf 

and Hispanics would increase with an estimated loss of nearly 

200,000 jobs held by Black workers and more than 300,000 jobs 

held by Hispanic workers. 

Such technical, procedural and legal shortcomings are why 32 

states opposed the proposed rule and sixteen states alongside leading industry stakeholders brought multiple challenges. The final 

rule was published in the Federal Register on October 23, 2015, a 

total of 81 days after it was initially announced. The publication 

date initiated an influx of legal petitions against the rules, including challenges by over half the states. 

There are also numerous concerns from stakeholders regarding 

limited opportunities to meaningfully participate in the regulatory 

process. The final rules evolved from a settlement agreement that 

limited substantive involvement to a select group of environmental 

activists and some state and local governments. In the rush to comply with the arbitrary deadlines, the agency deviated from established policies and circumvented transparency laws and basic public participation requirements. The ensuing technical, legal and policy challenges are the result of the one-sided and insular approach 

used to develop these regulations. 

Initial findings of an ongoing Committee investigation into the 

role environmental activist organizations played in EPA’s rulemaking process further solidified these concerns. Preliminary findings were documented in a 72-page Majority Staff Report on August, 4, 2015, entitled ‘‘Obama’s Carbon Mandate: An Account of 

Collusion, Cutting Corners, and Costing Americans Billions.’’ 

Finally, while the existing source standard is being labeled as 

the core component of the President’s domestic climate agenda, the 

EPA failed to measure whether it would produce any meaningful 

environmental benefits. Industry analysis using EPA’s numbers 

and methods, found that CO2 concentrations would be reduced by 

less than 0.5 percent, global temperature rise would be reduced by 

0.016 degrees Fahrenheit, and sea level rise would be reduced by 

the thickness of three sheets of paper.4 For the final rule, the same 

analysis found CO2 concentrations would be reduced by 0.2 percent, 

global temperature would be reduced by 0.01 degrees Fahrenheit 

and sea level reduced would be reduced by the thickness of two 

human hairs.5 Even more concerning is that the CO2 reductions 

achieved over the 11-year life of the existing source rule would be 

rendered pointless by a few months of CO2 emissions in China.6

OBJECTIVES OF THE LEGISLATION

Given the range of technical, procedural and legal concerns regarding the President’s carbon mandates, S. 1324 repeals the final 

rules and sets forth new requirements the agency must follow in 

setting replacement standards under section 111. The bill reinVerDate Sep 11 2014 06:23 Oct 31, 2015 Jkt 059010 PO 00000 Frm 00005 Fmt 6659 Sfmt 6602 E:\HR\OC\SR159.XXX SR159

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states balance and a range of protections for impacted stakeholders 

through the following provisions. 

First, S. 1324 requires EPA set standards for new, modified and 

reconstructed plants based on existing technology. In particular, 

the bill requires that any new technology be used for at least 12- 

months at 6 separate power facilities throughout the country. The 

bill also prevents the EPA from using any demonstration projects— 

projects that are reliant on federal support as specified in the Energy Policy Act of 2005—from being used to set the standard. 

Second, S. 1324 requires EPA to measure the environmental impacts of any proposed standards. Specifically, the bill requires EPA 

to submit a report to Congress that includes projected domestic and 

global GHG reductions alongside measured impacts on any associated ‘‘climate indicators.’’ 

Third, the S. 1324 prevents EPA from mandating a one-size-fitsall approach to compliance. The bill requires EPA issue state-specific model plans that account for a state’s energy needs, existing 

infrastructure and local laws. 

Fourth, S. 1324 extends compliance dates. The bill would extend 

deadlines for compliance, including deadlines for state plan submissions, until after any legal challenges raised during the first 60 

days of Federal Register publication have been resolved. 

Fifth, S. 1324 provides a safe harbor for states to protect their 

ratepayers. The bill prevents a state from being forced to implement a SIP or FIP that the state’s governor determines would negatively impact economic growth, negatively impact the reliability of 

their electricity system, or negatively impact electricity costs for 

ratepayers. 

Sixth, S. 1324 prevents highway fund sanctions for noncompliance. The bill would prevent the EPA from withholding highway 

funds from any state that chooses to forego or opt-out of standards 

set under section 111. 

Finally, S. 1324 restates existing law. Existing power plants are 

already subject to regulation under the Mercury and Air Toxics 

rule. The Clean Air Act explicitly prevents this type of double regulation. This is a restatement of existing law to prevent EPA from 

attempting to rewrite the law to support their illegal and unprecedented actions. 

Despite the multitude of concerns raised by stakeholders regarding basic legal authority, costs, reliability and stakeholder input, 

the agency is pushing forward with its now final rules and associated deadlines. States have already and will continue to be forced 

to assess and develop a plan of action for rules that were developed 

with limited state involvement, lack basic legal backing, and will 

cause harm to their local communities. However these plans of action are characterized, they will be extremely complex and require 

significant time and resource investment. 

SECTION-BY-SECTION ANALYSIS

Section 1. Short title 

This section designates the title of the bill as the ‘‘Affordable Reliable Electricity Now Act of 2015’’ 


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Section 2. Definitions 

This section defines ‘‘Administrator’’ as the Administrator of the 

Environmental Protection Agency; ‘‘Demonstration project’’ as a 

project to test or demonstrate the feasibility of carbon capture and 

storage technologies that have received government funding or financial assistance; ‘‘Existing Source’’ as the meaning given the 

term in section 111(a) of the Clean Air Act; ‘‘Greenhouse gas’’ as 

any of the following: carbon dioxide, methane, nitrous oxide, sulfur 

hexafluoride, hydrofluorocarbons or perfluorocarbons; ‘‘Modification’’ as the meaning given the term in section 111(a) of the Clean 

Air Act; ‘‘Modified Source’’ as a stationary source that undergoes a 

modification after enactment of this Act; ‘‘New source’’ as the 

meaning given such term in CAA section 111(a); and ‘‘Reconstructed Source’’ as any stationary source that undergoes reconstruction as defined in section 60.15 of title 40, Code of Federal 

Regulations after the date of enactment of this Act. 

Section 3. Standards of performance for new, modified, and reconstructed fossil fuel—fired electric utility generating units 

This section provides direction relating to the establishment of 

standards for new, modified, and reconstructed fossil fuel-fired electricity generating units (EGUs). This section provides that the EPA 

Administrator must establish separate source categories for new 

EGUs fueled with coal and natural gas. This section also provides 

that for any fossil fuel-fired electric generating units, the EPA Administrator may not set a standard unless it has been achieved for 

a continuous 12-month period by at least 6 EGUs located at different power plants in the United States, which EGUs collectively 

are representative of the operating characteristics of EGUs at different locations in the U.S. and which have operated for the entire 

12-month period on a full commercial basis. This section sets a subcategory for EGUs fueled by lignite coal and restricts standards 

based on results from a demonstration project. 

Section 4. Standards of performance for existing fossil fuel-fired 

electric utility generating units, compliance extension, and ratepayer protection 

This section provides direction relating to the establishment of 

standards for existing fossil fuel-fired electricity generating units 

(EGUs). This section provides that the Administrator must submit 

a report to Congress describing the quantity of projected GHG 

emissions reductions and assessing the impacts of a rule to EPA’s 

climate indicators. The section further requires EPA to issue statespecific model plans, extends compliance dates until legal questions 

are resolved, and allows States to opt-out of compliance if the rule 

would have negative impacts on economic growth, reliability or result in electricity rate increases. 

Section 5. Limitation on effect of noncompliance 

This section provides that noncompliance by a State with any 

proposed, modified, or final rule described within shall not be subject to highway sanctions under Section 179(b)(1) of the Clean Air 

Act. 


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Section 6. Repeal of earlier rules and guidelines 

This section provides that the EPA’s proposed standards for new, 

modified and reconstructed, and existing fossil fuel-fired EGUs, 

and any substantially similar rules that do not meet the requirements of the Act, are of no force and effect. 

Section 7. Restatement of existing law 

This section provides a restatement of existing law that existing 

sources regulated under section 112 of the Clean Air Act are precluded from being regulated under Section 111 of the Clean Air 

Act. 

LEGISLATIVE HISTORY

On May 13, 2015, Senator Capito, introduced S. 1324, the 

ARENA Act. Senators Inhofe, Manchin, Alexander, Barrasso, 

Blunt, Boozman, Cassidy, Coats, Cornyn, Cotton, Crapo, Cruz, 

Daines, Enzi, Fischer, Hoeven, Isakson, McConnell, Paul, Perdue, 

Risch, Roberts, Rounds, Thune, Tillis and Wicker were original cosponsors of the legislation. The bill was referred to the Senate 

Committee on Environment and Public Works. 

On August 5, 2015, the Senate Committee on Environment and 

Public Works conducted a business meeting to consider S. 1324. 

The bill, as amended, was favorably reported out of Committee by 

voice vote. 

HEARINGS

During the 114th Congress, the Committee held three full committee hearings and two subcommittee hearings to conduct oversight and hear from stakeholders regarding concerns related to the 

proposed and now final carbon emission standards. 

2/11/2015 Full Committee Hearing: ‘‘Examining EPA’s proposed 

carbon dioxide emissions rules from new, modified, and existing 

power plants’’ 

3/11/2015 Full Committee Hearing: ‘‘Examining State Perspectives of the EPA’s proposed carbon dioxide emissions rule for existing power Plants’’ 

3/23/2015 Full Committee Field Hearing: ‘‘Regional Impacts of 

EPA Carbon Regulations: The Case of West Virginia’’ 

5/5/2015 Subcommittee on Clean Air and Nuclear Safety Hearing: ‘‘Legal Implications of the Clean Power Plan’’ 

6/23/2015 Subcommittee on Clean Air and Nuclear Safety Hearing: ‘‘The Impacts of EPA’s proposed Carbon Regulations on Energy 

Costs for American Businesses, Rural Communities and Families, 

and a legislative hearing on S. 1324’’ 

ROLLCALL VOTES

The Committee on Environment and Public Works met to consider S. 1324 on August 5, 2015. 

The committee did not agree to an amendment by Senator 

Merkley by a rollcall vote of 9 ayes, 11 nays, and 0 not voting. Voting in favor were Senators Booker, Boxer, Cardin, Carper, Gillibrand, Markey, Merkley, Sanders and Whitehouse. Voting against 


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the amendment were Senators Barrasso, Boozman, Capito, Crapo, 

Fischer, Inhofe, Rounds, Sessions, Sullivan, Vitter and Wicker. 

The committee did not agree to an amendment by Senator 

Whitehouse by a rollcall vote of 9 ayes, 11 nays, and 0 not voting. 

Voting in favor were Senators Booker, Boxer, Cardin, Carper, Gillibrand, Markey, Merkley, Sanders and Whitehouse. Voting against 

the amendment were Senators Barrasso, Boozman, Capito, Crapo, 

Fischer, Inhofe, Rounds, Sessions, Sullivan, Vitter and Wicker. 

The committee did not agree to an amendment by Senator Markey by a rollcall vote of 9 ayes, 11 nays, and 0 not voting. Voting 

in favor were Senators Booker, Boxer, Cardin, Carper, Gillibrand, 

Markey, Merkley, Sanders and Whitehouse. Voting against the 

amendment were Senators Barrasso, Boozman, Capito, Crapo, 

Fischer, Inhofe, Rounds, Sessions, Sullivan, Vitter and Wicker. 

The committee did not agree to another amendment by Senator 

Markey by a rollcall vote of 9 ayes, 11 nays, and 0 not voting. Voting in favor were Senators Booker, Boxer, Cardin, Carper, Gillibrand, Markey, Merkley, Sanders and Whitehouse. Voting against 

the amendment were Senators Barrasso, Boozman, Capito, Crapo, 

Fischer, Inhofe, Rounds, Sessions, Sullivan, Vitter and Wicker. 

The committee did not agree to an amendment by Senator Gillibrand by a rollcall vote of 9 ayes, 11 nays, and 0 not voting. Voting 

in favor were Senators Booker, Boxer, Cardin, Carper, Gillibrand, 

Markey, Merkley, Sanders and Whitehouse. Voting against the 

amendment were Senators Barrasso, Boozman, Capito, Crapo, 

Fischer, Inhofe, Rounds, Sessions, Sullivan, Vitter and Wicker. 

The committee did not agree to another amendment by Senator 

Whitehouse by a rollcall vote of 9 ayes, 11 nays, and 0 not voting. 

Voting in favor were Senators Booker, Boxer, Cardin, Carper, Gillibrand, Markey, Merkley, Sanders and Whitehouse. Voting against 

the amendment were Senators Barrasso, Boozman, Capito, Crapo, 

Fischer, Inhofe, Rounds, Sessions, Sullivan, Vitter and Wicker. 

The Committee on Environment and Public Works ordered S. 

1324 reported favorably to the Senate by voice vote with a quorum 

present. 

REGULATORY IMPACT STATEMENT

In compliance with section 11(b) of rule XXVI of the Standing 

Rules of the Senate, the committee makes evaluation of the regulatory impact of the reported bill. The committee finds that S. 1324 

does not create any additional regulatory burdens, nor will it cause 

any adverse impact on the personal privacy of individuals. 

MANDATES ASSESSMENT

In compliance with the Unfunded Mandates Reform Act of 1995 

(Public Law 104–4), the committee note that the Congressional 

Budget Office found, ‘S. 1324 contains no intergovernmental or private-sector mandates as defined in the Unfunded Mandates Reform 

Act.’ 

COST OF LEGISLATION

Section 403 of the Congressional Budget and Impoundment Control Act requires that a statement of the cost of the reported bill, 


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prepared by the Congressional Budget Office, be included in the report. That statement follows: 

OCTOBER 8, 2015. 

Hon. JIM INHOFE, 

Chairman, Committee on Environment and Public Works, 

U.S. Senate, Washington, DC. 

DEAR MR. CHAIRMAN: The Congressional Budget Office has prepared the enclosed cost estimate for S. 1324, the Affordable Reliable Electricity Now Act of 2015. 

If you wish further details on this estimate, we will be pleased 

to provide them. The CBO staff contacts are Susanne S. Mehlman 

and Jon Sperl. 

Sincerely, 

KEITH HALL. 

Enclosure. 

S. 1324—Affordable Reliable Electricity Now Act of 2015 

S. 1324 would repeal or require changes to rules and guidelines 

issued by the Environmental Protection Agency (EPA) that address 

greenhouse gas emissions from power plants that use fossil fuels. 

Under the bill, before proposing any new rules or guidance related 

to those emissions, EPA would need to meet certain standards and 

follow certain procedures. Final rules that would be affected by this 

legislation include: 

• Standards of Performance for Greenhouse Gas Emissions from 

New, Modified, and Reconstructed Stationary Sources: Electric 

Utility Generating Units, signed by the Environmental Protection 

Agency on August 3, 2015; 

• Standards of Performance for Greenhouse Gas Emissions from 

New Stationary Sources: Electric Utility Generating Units, published in the Federal Register on January 8, 2014; 

• Carbon Pollution Emission Guidelines for Existing Stationary 

Sources: Electric Utility Generating Units, published in the Federal 

Register on June 18, 2014; and 

• Carbon Pollution Emission Guidelines for Existing Stationary 

Sources: EGUs in Indian Country and U.S. Territories; Multi-Jurisdictional Partnerships, published in the Federal Register on November 4, 2014. 

Before developing any rules or guidance for existing power 

plants, the legislation would require EPA to provide a report to the 

Congress that describes the level of emissions reductions a rule is 

projected to achieve both globally and domestically, conduct modeling of the effect of the rule on climate indicators, and issue statespecific plans for reductions in greenhouse gas emissions. 

In addition, when developing any rules or guidance for power 

plants that are new, modified or reconstructed, this legislation 

would require EPA to create separate categories for power plants 

that use natural gas as a fuel source and for power plants that use 

coal as a fuel source, and to base any new emissions standards on 

actual emissions levels achieved by at least six different electric 

generating units across the United States when operating for a 

continuous 12-month period. CBO expects that under S. 1324, EPA 

would likely propose a new rule for carbon emissions from new, 


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modified, and reconstructed power plants, consistent with the requirements of this legislation. 

The bill would not prohibit EPA from continuing to work on activities related to power plants, such as developing guidance and 

providing technical assistance to states. Based on information from 

EPA, CBO estimates that implementing this legislation would not 

have a significant effect on EPA’s workload or spending related to 

power plant emissions. 

Enacting S. 1324 would not affect direct spending or revenues; 

therefore, pay-as-you-go procedures do not apply. 

S. 1324 contains no intergovernmental or private-sector mandates as defined in the Unfunded Mandates Reform Act. 

The CBO staff contacts for this estimate are Susanne S. 

Mehlman and Jon Sperl. The estimate was approved by H. Samuel 

Papenfuss, Deputy Assistant Director for Budget Analysis. 


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MINORITY VIEWS OF BOXER, CARPER, CARDIN, SANDERS, 

WHITEHOUSE, MERKLEY, GILLIBRAND, BOOKER, AND 

MARKEY ON S. 1324, AS REPORTED BY THE EPW COMMITTEE 

Power plants are the largest source of the nation’s harmful carbon pollution, accounting for nearly 31% of U.S. greenhouse gas 

emissions. The final Clean Power Plan standard that President 

Obama announced on August 3, 2015 is the first rule to limit the 

amount of carbon pollution that can be released into the air from 

existing power plants. On August 3, 2015, President Obama also 

announced final standards for carbon pollution from new, modified, 

and reconstructed power plants (NSPS). 

When it is fully implemented in 2030, the final Clean Power Plan 

will cut emissions from power plants 32% below 2005 levels. In addition, the Clean Power Plan will increase the percentage of our 

electricity generating capacity from renewables to 28% in 2030. 

S. 1324 blocks implementation of the President’s Clean Power 

Plan and the standards for new, modified, and reconstructed power 

plants. Furthermore, the bill allows states to opt out of complying 

with any future plan. The bill creates giant loopholes that make it 

nearly impossible to take any meaningful action to address climate 

change and reduce harmful carbon pollution from power plants. 

Turning away from the President’s Clean Power Plan, as S. 1324 

would do, would not only move us toward the most devastating impacts of climate change, but hurt the health of the American people. 

S. 1324 would block the climate pollution reductions and public 

health benefits of the Clean Power Plan and it would alter the 

Clean Air Act in several significant and harmful ways: • Place new restrictions on the ability of the Environmental 

Protection Agency (EPA) to issue any carbon pollution standards for both new and existing power plants; 

• Repeal all previous EPA proposals and rules controlling 

carbon pollution from new, modified, and existing power 

plants; 

• Change the way EPA is able to regulate new power plants 

by limiting the technologies EPA can consider in setting the 

standards; 

• Alter the Clean Air Act by allowing states to opt out of any 

new climate rule under Section 111 for existing power plants; 

• Delay any new carbon regulation from being implemented 

until all the lawsuits are resolved—which could take a number 

of years; and 

• Alter the Clean Air Act to require EPA to take a ‘‘pick your 

poison’’ approach by prohibiting EPA from regulating power 

plants for both air toxics, such as mercury, and carbon pollution. 


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Letters opposing this bill from dozens of public health, business, 

environmental, and religious groups were entered into the record 

at the legislative hearing. These letters criticized the damaging 

changes to the Clean Air Act that would result from S. 1324 and 

highlighted the benefits of the Clean Power Plan, which are addressed below. 

THE CLEAN POWER PLAN

Public health benefits 

The Clean Power Plan will deliver important health benefits for 

our families in 2030 and every year after. By cutting the air pollutants that are emitted along with climate pollution the Clean Power 

Plan will avoid: 

• 3,600 premature deaths; 

• 1,700 heart attacks; 

• 90,000 asthma attacks; and 

• 300,000 missed workdays and schooldays by 2030. 

In addition, for every dollar invested through the Clean Power 

Plan, American families will see up to $4 in health benefits from 

the soot and smog pollution reductions achieved. 

Employment 

The EPA estimates that the Clean Power Plan will create thousands of jobs, including jobs in the energy efficiency field. The final 

plan includes the Clean Energy Incentive Program (CEIP), which 

incentivizes early expansion of renewables and investment in energy efficiency. This program will help accelerate job growth in 

those important sectors. EPA estimates that improving demandside energy efficiency will create approximately 53,000 to 84,000 

jobs in 2025 and about 52,000 to 83,000 jobs in 2030. 

Consumer savings and benefits to low-income communities 

The Clean Power Plan will lower household electricity bills by 

encouraging energy efficiency. By 2030, the EPA estimates families 

will save, on average, $85 a year. There will also be benefits for 

low-income communities through the CEIP, which prioritizes early 

investment in energy efficiency projects in low-income communities. In addition, implementation of the plan will accelerate the 

development of clean, renewable energy and reduce pollution from 

power plants, which has a disproportionate negative effect on lowincome, minority communities. 

According to a statement issued by the NAACP on August 4, 

2015: 

‘‘Power plants are the country’s single biggest source of 

carbon pollution–responsible for up to 40% of the country’s 

emissions of greenhouse gases. According to the plan, 

these measures will reduce the pollutants that contribute 

to life-threatening soot and smog by 70% which would 

have significant implications for communities of color. 

Three out of every four African Americans live within 30 

miles of a coal-fired power plant. These communities are 

disproportionately represented among those with respiratory illnesses, such as lung cancer and pulmonary disVerDate Sep 11 2014 06:23 Oct 31, 2015 Jkt 059010 PO 00000 Frm 00013 Fmt 6604 Sfmt 6604 E:\HR\OC\SR159.XXX SR159

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1 (August 4, 2015). NAACP Statement on President Obama’s Clean Power Plan. National Association for the Advancement of Colored People. Retrieved from http://www.naacp.org/press/entry/ 

naacp-statement-on-president-obamas-clean-power-plan. 2 (August 26, 2015). Why Media Should Stop Citing NERA’s Flawed Study on the EPA Climate 

Plan. Media Matters for America. Retrieved from http://mediamatters.org/research/2015/08/26/ 

why-media-should-stop-citing-neras-flawed-study/205177. 3See, e.g., (August 3, 2015). APHA applauds the Clean Power Plan. American Public Health 

Association. Retrieved from http://www.apha.org/news-and-media/news-releases/apha-news-releases/apha-applauds-the-clean-power-plan; (August 3, 2015). National Religious Organizations 

Praise Clean Power Plan. The National Religious Partnership for the Environment. Retrieved 

from http://www.nrpe.org/uploads/2/4/4/7/24473122/nrpe_cpp_release_august_2015.pdf. 4 (August 13, 2015). Support for the Clean Power Plan. Hart Research Associates and Chesapeake Beach Consulting. Retrieved from http://www.lcv.org/issues/polling/clean-power-planpoll.pdf. 5 (August 4, 2015). Americans Strongly In Favor of Plan to Limit Carbon Emissions. Public 

Policy Polling. Retrieved from http://aufc.3cdn.net/ae95ea4da2c00733cc_9am6ib5ns.pdf. 

ease. In fact, African American children are 3 times more 

likely to be admitted to the hospital for an asthma attack 

and twice as likely to die of asthma.’’ 

The NAACP Director of Environment and Climate Justice specifically addressed the harms of carbon pollution to minorities and 

low-income communities: 

‘‘We stridently refute the contentions of those who have 

used an equity and civil rights frame to oppose regulations 

on carbon pollution by claiming undue cost burden on vulnerable communities. The cost these communities are paying from their close proximity to polluting plants and from 

choking down toxins daily is the toll that compromised 

health, negative educational outcomes and challenged 

work performance takes on community well-being and 

growth potential. Still others see the devastating climate 

change impacts from pollution including disasters, rising 

sea levels, and decreasing availability of affordable nutritious foods, all of which disproportionately affect our most 

vulnerable communities.’’ 1

Economic benefits outweigh costs 

The EPA estimates that the combined health and climate benefits of the Clean Power Plan in 2030 are worth an estimated $34 

billion to $54 billion. These benefits far outweigh the estimated 

costs of $8.4 billion. As it has with other Clean Air Act regulations, 

industry has made extreme claims about the costs of the proposed 

rule. The U.S. Chamber of Commerce analysis of the proposed rule, 

which provides the basis for industry’s criticism of the rule, has 

been roundly criticized as it applied to the proposed rule; it is not 

relevant to the final rule.2

Broad public support for the Clean Power Plan 

The final Clean Power Plan drew strong support from a broad 

range of religious organizations and public health groups 3 and is 

strongly supported by voters. An August 2015 poll shows 60% of 

voters support the plan, while just 31% oppose it. ‘‘[T]hose who 

strongly support this plan outnumber those who strongly oppose it 

by eight percentage points (27% to 19%).’’ 4 Another poll from August 2015 shows that 59% of voters say states should move forward 

and develop a plan to cut carbon pollution from power plants.5


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6Doniger, D. (March 11, 2015). 32 States, What? Senator Inhofe’s Fuzzy Math on States and 

EPA. Retrieved from http://switchboard.nrdc.org/blogs/ddoniger/ 

32_states_what_senator_inhofes.html. 7See, e.g., http://www.eenews.net/interactive/clean_power_plan/states/montana. 

The opposition to the proposed rule has been overstated and 

claims that 32 states opposed the proposed rule have been refuted.6

States, including some that express concern with the rule, (MI, GA, 

ND, MT) are moving forward with developing their plans.7

The Clean Power Plan reflects an inclusive process and incorporates 

public comments 

EPA received more than 4.3 million comments on the proposed 

Clean Power Plan. The final rule differs from the proposal in several significant ways that address issues raised in the comments. 

The final rule affords states additional time to submit State Implementation Plans to EPA, providing up to 3 years rather than 1– 

2 years. States also have additional time to begin making reductions in emissions—the initial compliance date is now 2022 instead 

of 2020. The final rule also provides for a more gradual phase-in 

of reductions to avoid concerns about the steep reductions in the 

proposed rule. 

Flexibility for states to implement the Clean Power Plan 

In the Clean Power Plan, EPA establishes specific goals for each 

state to reduce the carbon pollution from its power producing system based on separate standards for both gas and coal-fired plants. 

Each state is given broad flexibility on how it will meet its statespecific goal. Various approaches range from improving the efficiency of existing coal and natural gas power plants, expanding the 

use of renewable energy, implementing emissions trading plans, increasing energy efficiency, upgrading transmission, or including 

nuclear and hydropower uprates in their plans. 

The final rule also gives states two options for developing their 

plans—rate-based goals which apply to each power plant in the 

state or mass-based goals which set an emissions target for the 

state. These options allow states to customize a path forward for 

achieving reductions in carbon pollution. Finally, the CEIP encourages investment in energy efficiency in low income communities 

and the development of renewable energy that will begin generating power between 2020 and 2022, which will enable states to 

generate credits toward compliance. 

EPA also issued a draft Federal Implementation plan that states 

can use to guide the development of their own plans. 

Reliability is addressed in the Clean Power Plan 

Climate change is a threat to the reliability of our electricity system. According to the Department of Energy (DOE), severe weather 

is the number one cause of power outages in the U.S. and costs the 

economy billions of dollars a year in lost output and wages, spoiled 

inventory, delayed production, inconvenience and damage to grid 

infrastructure. Between 2003 and 2012, roughly 679 power outages, 


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8 (August 2013). Economic Benefits of Increasing Grid Resilience to Weather Outages. Executive Office of the President. Retrieved from http://energy.gov/sites/prod/files/2013/08/f2/ 

Grid%20Resiliency%20Report—FINAL.pdf. 9Duffy, J., & Weeks, A. (June 15, 2015). Let’s Go EPA—Remain Strong on Power Plant Rules. 

Clean Air Task Force. Retrieved from http://www.catf.us/blogs/ahead/2015/06/15/lets-go-epa-remain-strong-on-power-; see also (July 10, 2015). Technical Support Document. Environmental 

Protection Agency. Retrieved from http://www3.epa.gov/airquality/cpp/tsd-cps-literature-surveycarbon-capture-technology.pdf. 10 EPA Fact Sheet: Carbon Pollution Standards, http://www3.epa.gov/airquality/cpp/fs-cpsoverview.pdf. 

each affecting at least 50,000 customers, occurred due to weather 

events.8

The Clean Power Plan includes several provisions that are intended to ensure reliability of the nation’s electricity supply as 

states implement the rule. Some of the changes in the final rule, 

such as starting reductions in 2022 and the flexibility states and 

utilities have to plan for and achieve reductions, including trading 

and multi-state approaches to achieve emissions reductions, will 

ensure that compliance with the rule provides reliable electricity. 

In addition, state plans must consider reliability and the final rule 

allows states to revise a plan if there is an unanticipated or significant reliability challenge that arises. Further, the rule includes a 

‘‘safety valve’’ provision in the final rule for emergency situations. 

Along with the final rule EPA issued a memo of coordination 

with DOE and the Federal Energy Regulatory Commission (FERC). 

This memo describes steps that will be taken to ensure reliable 

electricity generation and transmission as the Clean Power Plan is 

implemented and provides for ongoing communication and cooperation between EPA, DOE and FERC. 

FINAL STANDARDS FOR NEW, MODIFIED, AND RECONSTRUCTED POWER

PLANTS

On August 3, 2015, the EPA also issued final standards for new, 

modified or reconstructed power plants under section 111(b) of the 

Clean Air Act. This rule complements the Clean Power Plan by setting carbon pollution standards for new coal or gas fired plants as 

well as modified or reconstructed plants that require the application of the best system of emission reduction (BSER). 

Given that the Clean Air Act calls for standards for new plants 

to be technology forcing, the final standard for new coal plants is 

based on partial carbon capture and storage (CCS) technology as 

BSER. CCS technology is being utilized at facilities in Canada and 

the U.S.9 According to EPA, the final rule is consistent with the 

current investment trends in the industry and the standards ‘‘are 

not expected to have notable costs and are not projected to impact 

electricity prices or reliability.’’ 10

LEGAL AUTHORITY FOR CARBON POLLUTION STANDARDS

Both the Clean Power Plan and the final standards for new, 

modified, and reconstructed power plants are promulgated pursuant to EPA’s established authority under the Clean Air Act to regulate carbon pollution. The U.S. Supreme Court has ruled three 

times in support of EPA’s legal authority to control carbon pollution under existing law. In 2007, the Supreme Court confirmed in 

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tion. Four years later, the Supreme Court in American Electric 

Power v. Connecticut, specifically found that the Clean Air Act has 

provisions (Section 111) in place to limit carbon pollution from 

power plants—the very provisions EPA is using in its proposed existing power plant carbon standards. Lastly, on June 23, 2014, the 

Supreme Court in Utility Air Resources Group v. EPA again confirmed that the Clean Air Act covers carbon pollution. The case 

upheld EPA’s rules requiring that if an individual industrial source 

needs a pre-construction air permit (known as a PSD permit) because of the amount of conventional air pollutants it will emit, EPA 

can require that the same source consider how it will also best control carbon pollution. 

AMENDMENTS TO S.1324

During markup, as noted in the Rollcall Votes section above, the 

Committee considered six amendments that addressed the impacts 

of climate change, the need to ensure the benefits of implementing 

the Clean Power Plan, the need for federal action, as well as the 

need to express the sense of the Senate regarding the science of climate change. 

Each amendment was rejected on a party line vote of 9 yeas and 

11 nays. 

Senator Markey offered an amendment that recognized the significant public health benefits that will come with implementation 

of the Clean Power Plan, including the prevention of 3,600 premature deaths, 90,000 asthma attacks, and the avoidance of 

300,000 missed days of work or school. The amendment stated that 

S. 1324 does not take effect before a plan is in place to achieve the 

health benefits created by the Clean Power Plan. All of the Republicans voted against the amendment; the amendment was defeated. 

Senator Markey offered another amendment to ensure S. 1324 

would not apply if the bill has a negative impact on clean energy 

jobs. The EPA estimates that the Clean Power Plan will create 

thousands of jobs, and in particular EPA estimates that improving 

demand-side energy efficiency will create the need for about 53,000 

to 84,000 jobs in 2025 and about 52,000 to 83,000 jobs in 2030. All 

of the Republicans voted against the amendment; the amendment 

was defeated. 

Senators Gillibrand and Markey offered an amendment recognizing that climate change is a threat to our coasts as sea levels 

rise. The American Meteorological Society issued its State of the 

Climate in 2014 Report noting that numerous key climate change 

indicators were at or near record levels in 2014, including a record 

high for sea levels—2.5 inches above 1993 levels. The amendment 

prohibited the Act from taking effect if its implementation contributes to an increase in sea level rise and coastal erosion. All of the 

Republicans voted against the amendment; the amendment was defeated. 

Senator Merkley offered an amendment to express the sense of 

the Senate that climate change is real and due to human activity. 

The amendment recognized that leading scientists worldwide, as 

well as our own government experts at NASA and NOAA, tell us 

that climate change is real and that human activity is causing it. 

In addition, the amendment recognized that the climate change imVerDate Sep 11 2014 06:23 Oct 31, 2015 Jkt 059010 PO 00000 Frm 00017 Fmt 6604 Sfmt 6602 E:\HR\OC\SR159.XXX SR159

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pacts that scientists predicted years ago are happening now, including record heat, droughts, wildfires, storms, and sea ice melt. 

All of the Republicans voted against the amendment; the amendment was defeated. 

Senator Whitehouse offered an amendment to create a new findings section in S. 1324 stating the sense of the Senate that climate 

change is real and not a hoax, and human activity significantly 

contributes to it; and the federal government has a responsibility 

to act. According to a Washington Post-ABC poll, a bipartisan majority of the American people want federal limits on carbon pollution. Approximately 70 percent say the federal government should 

require limits on carbon pollution from existing power plants, and 

70 percent support requiring states to limit the amount of carbon 

pollution within their borders. Further, 97% of scientists agree 

human activity is leading to dangerous climate change that threatens our families. All of the Republicans voted against the amendment; the amendment was defeated. 

The second amendment offered by Senator Whitehouse would 

have required the federal government to have another program or 

legislative proposal in place that would reduce carbon pollution by 

at least as much as the EPA’s power plant rules before the Act can 

take effect. When the Clean Power Plan is fully implemented it will 

cut carbon pollution from the power sector by 32%. These reductions are an essential element of President Obama’s Climate Action 

Plan and this amendment would require an alternative plan to be 

in place to secure equivalent reductions. All of the Republicans 

voted against the amendment; the amendment was defeated. 

BARBARA BOXER. 

THOMAS CARPER. 

BENJAMIN CARDIN. 

BERNARD SANDERS. 

SHELDON WHITEHOUSE. 

JEFF MERKLEY. 

KIRSTEN GILLIBRAND. 

CORY BOOKER. 

EDWARD MARKEY. 


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24 US Code executes the amendment as follows: ‘‘(1) The Administrator shall prescribe regulations which shall establish a procedure similar to that provided by section 7410 of this title 

under which each State shall submit to the Administrator a plan which (A) establishes standards of performance for any existing source for any air pollutant (i) for which air quality criteria 

have not been issued or which is not included on a list published under section 7408(a) of this 

title or emitted from a source category which is regulated under section 7412 of this title but 

(ii) to which a standard of performance under this section would apply if such existing source 

were a new source, and (B) provides for the implementation and enforcement of such standards 

of performance. Regulations of the Administrator under this paragraph shall permit the State 

in applying a standard of performance to any particular source under a plan submitted under 

this paragraph to take into consideration, among other factors, the remaining useful life of the 

existing source to which such standard applies.’’ 42 USC 7411(d)(1). 

CHANGES IN EXISTING LAW

In compliance with section 12 of rule XXVI of the Standing Rules 

of the Senate, changes in existing law made by the bill as reported 

are shown as follows: Existing law proposed to be omitted is enclosed in øblack brackets¿, new matter is printed in italic, existing 

law in which no change is proposed is shown in roman: 

* * * * * * * 

CLEAN AIR ACT

STANDARDS OF PERFORMANCE FOR NEW STATIONARY SOURCES

SEC. 111. (a) For purposes of this section: 

(1)* * * 

* * * * * * * 

ø(d)(1) The Administrator¿ 

(d) STANDARDS OF PERFORMANCE FOR EXISTING SOURCES; RE- MAINING USEFUL LIFE OF SOURCE.— (1) IN GENERAL.—The Administrator ;shall prescribe regulations which shall establish a procedure similar to that provided 

by section 110 under which each State shall submit to the Administrator a plan which (A) establishes standards of performance for any existing source for any air pollutant (i) for which 

air quality criteria have not been issued or which is not included on a list published under øsection 108(a) øor emitted 

from a source category which is regulated under section 

112¿øor 112(b)¿ 24 but¿section 108(a) or emitted from a source 

category that is regulated under section 112, but (ii) to which 

a standard of performance under this section would apply if 

such existing source were a new source, and (B) provides for 

the implementation and enforcement of such standards of performance. Regulations of the Administrator under this paragraph shall permit the State in applying a standard of performance to any particular source under a plan submitted 

under this paragraph to take into consideration, among other 

factors, the remaining useful life of the existing source to 

which such standard applies. 

ø(2) The Administrator¿ 

(2) AUTHORITY OF THE ADMINISTRATOR.—The Administrator shall 

have the same authority— 

(A) to prescribe a plan for a State in cases where the State 

fails to submit a satisfactory plan as he would have under section 110(c) in the case of failure to submit an implementation 

plan, and 


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(B) to enforce the provisions of such plan in cases where the 

State fails to enforce them as he would have under sections 

113 and 114 with respect to an implementation plan. øIn promulgating a standard¿ 

(3) CONSIDERATIONS.—In promulgating a standard of performance under a plan prescribed under this paragraph, the 

Administrator shall take into consideration, among other factors, remaining useful lives of the sources in the category of 

sources to which such standard applies. 

(4) PROHIBITION.—The Administrator shall not regulate as an 

existing source under this subsection any source category regulated under section 112. 

Æ 


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