CLEAN POWER PLAN

Proposal to Reduce 

Carbon Pollution From 

Existing Power Plants

January 23, 2015
This Proposal Deals With the Largest 

Source of GHG Emissions in the U.S.

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Outline

• Summary of Proposal

• Background on Clean Air Act Section 111(d)

• Pre-proposal Outreach & What We Heard

• Setting State Goals

• State Plans for Meeting Goals

• Costs and Benefits

• Next Steps

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This proposal will: 

• Reduce carbon pollution from existing power plants, for which there are 

currently no national limits.

• Maintain an affordable, reliable energy system.

• By 2030, reduce nationwide carbon dioxide (CO2) emissions, from the power 

sector by approximately 30% from 2005 levels.

• Significant reductions begin by 2020. 

• Cut hundreds of thousands of tons of harmful particle pollution, sulfur 

dioxide and nitrogen oxides as a co-benefit. 

• Provide important health protections to the most vulnerable, such as 

children and older Americans. 

• Lead to health and climate benefits worth an estimated $55 billion to $93 

billion in 2030. 

• From soot and smog reductions alone, for every dollar invested through the 

Clean Power Plan – American families will see up to $7 in health benefits. 

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Summary
• Build on actions states, cities and businesses across the country are 

already taking to address the risks of climate change. 

• Spur investment in cleaner and more efficient technologies, creating jobs 

and driving innovation.

• Require a reasonable emission reduction glidepath starting in 2020.

• Provide a flexible timeline—up to 15 years from guideline issuance—for 

all emission reduction measures to be fully implemented in 2030. 

• Recognizing that investments in infrastructure can take time to put in 

place and 

• Avoiding stranded assets.

• Provide an array of tools states can use to formulate approvable plans.

Summary (Cont’d)

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Background: Clean Air Act Section 111(d)

Best System of Emission Reduction

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• Previous EPA rules under this section of the Clean Air Act have 

considered “add-on” control technologies – like scrubbers -- that are 

technically feasible to deploy at virtually any facility. 

• In contrast, there are a wide variety of ways to reduce carbon pollution 

that are commercially available, technically feasible, and cost effective. 

• The opportunities vary from state to state, depending on how electricity 

is generated, energy infrastructure, and other factors. 

• In this proposal, EPA took an approach that viewed the Clean Air Act 

factors in determining Best System of Emission Reduction in light of the 

interconnected nature of power generation.

• BSER factors

• Costs

• Size of reductions 

• Technology

• Feasibility
• EPA conducted a robust pre-proposal stakeholder 

engagement process.

• Participated in meetings with over 300 utility, 

consumer, labor and environmental groups since 

June 2013.

• Held 11 public listening sessions around the 

country.

• 3,300 people attended.

• More than 1,600 people offered oral 

statements.

• Reached out to all 50 states.

• Some states noted their programs to address 

carbon evolved because of:

• The need to address carbon pollution;

• Electric system that is dynamic, and in the 

midst of market changes; and

• Modernizing the power sector is good for the 

economy.

• Common themes included reliability, flexibility, 

affordability, time for plans and implementation.

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Early Outreach Informed This Proposal
State Actions are Foundation of Proposal

• What we learned during the engagement process about what states are 

already doing has informed EPA’s proposal.

• State actions provide the foundation for our analysis.

• 10 states with market-based GHG emission programs .

• 38 states with renewable portfolio standards or goals.

• 47 states with utilities that run demand-side energy efficiency programs.

• 27 states with energy efficiency standards or goals.

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States and Communities with 

Programs That Reduce Carbon Pollution

State programs that reduce carbon include 

carbon cap and trade programs and energy 

efficiency and renewable energy standards or 

goals. 

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EPA Sets the Goals

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EPA Establishes a Goal for Every State

• EPA analyzed the practical and affordable strategies that states and utilities are 

already using to lower carbon pollution from the power sector. 

• Proposed goals are based on a consistent national formula, calculated with state 

and regional specific information. 

• The result of the equation is the state goal. 

• Each state goal is a rate – a statewide number for the future carbon intensity of 

covered existing fossil-fuel-fired power plants in a state.

• Encompasses the dynamic variables that ultimately determine how much carbon pollution is 

emitted by fossil fuel power plants.

• Accommodates the fact that CO2 emissions from fossil fuel-fired power plants are influenced 

by how efficiently they operate and by how much they operate. 

• The state goal rate is calculated to account for the mix of power sources in each 

state and the application of the “building blocks” that make up the best system of 

emission reduction.

• States will need to meet an interim goal and a final goal.

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States Have Flexibility

Basis for state goal –

Potential emissions 

pathway reflecting 

EPA’s analysis

 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029

 

A state can choose any trajectory 

of emission improvement as long 

as the interim performance goal is 

met on average over 10 years, and 

the final goal is met by 2030

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Carbon emissions from affected power 

plants in an example state

As an example, states could do less in the early years, and more in the later 

years, as long as on average it meets the goal

Timing of Power Plant Emission Reductions
Building Block Strategy EPA Used to 

Calculate the State Goal

Maximum Flexibility:

Examples of State 

Compliance Measures

1. Make fossil fuel-fired

power plants more 

efficient

Efficiency Improvements Efficiency improvements

Co-firing or switching to natural 

gas

Coal retirements

Retrofit CCS (e.g.,WA Parish in 

Texas)

2. Use lower-emitting power 

sources more

Dispatch changes to 

existing natural gas 

combined cycle (CC)

Dispatch changes to existing 

natural gas CC

3. Build more zero/lowemitting energy sourcesRenewable Energy

Certain Nuclear

New NGCC

Renewables

Nuclear (new and up-rates)

New coal with CCS

4. Use electricity more 

efficiently

Demand-side energy 

efficiency programs

Demand-side energy efficiency 

programs

Transmission efficiency 

improvements

Energy storage

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States Meet the Goals

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When States Plan, They Can:

• Look broadly across the power sector for strategies that get reductions. 

• Choose to rely to varying degrees on measures that EPA used to 

calculate the goal, or on other measures that were not part of the state 

goal-setting analysis. 

• Invest in existing energy efficiency programs or create new ones.

• Consider market trends toward improved energy efficiency and a 

greater reliance on lower carbon energy. 

• Tap into investments already being made to upgrade aging 

infrastructure.

• Expand renewable energy capacity.

• Integrate their plans into existing power sector planning processes.

• Design plans that use innovative, cost-effective regulatory strategies.

• Develop a state-only plan or collaborate with each other to develop 

plans on a multi-state basis.

• Decide how to treat plants nearing the end of their useful life and how 

to help plants avoid “stranded investments.”

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Flexibilities Available To States

• Timing: 

• Up to 15-year window in which 

to plan for and achieve 

reductions in carbon pollution. 

• Up to two or three years to 

submit final plans. 

• Form of goal: States can use either 

a rate-based or mass-based goal.

• Single or multi-state plans: States 

can collaborate and develop plans 

on a multi-state basis.

• Selection of measures: 

• States will choose how to meet 

the goal through whatever 

collection of measures reflects 

its particular circumstances and 

policy objectives. 

• State measures may impact and, 

in fact may be explicitly 

designed to reduce, CO2

emissions from utilities on a 

regional basis.

• EPA would support building off 

existing reduction programs. 

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States Choose How to Meet the Goals

• Demand-side energy efficiency 

programs.

• Generating electricity from 

low/zero-emitting facilities.

• Expanding use of existing NGCC 

units.

• Transmission efficiency 

improvements.

• Energy storage technology.

• Working with utilities to consider 

retiring units that are high emitting. 

• Energy conservation programs.

• Retrofitting units with partial CCS.

• Use of certain biomass.

• Efficiency improvements at higheremitting plants.

• Market-based trading programs.

• Building new renewables.

• Dispatch changes.

• Co-firing or switching to natural gas.

• Building new natural gas combined 

cycle units.

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Details About State Plans

• EPA will provide a list of about a dozen components that will need to be 

included in the plan.

• Measures to meet the state’s interim goal and final goal.

• Interim goal -- meet on average over a 10-year period from 2020-2029;

• Final goal -- meet in 2030 and thereafter.

• Individual and multi-state plans due Summer 2016. 

• Proposed timing of extensions to submit a complete plan, if justified and 

supported:

• Submit initial plan by Summer 2016;

• Individual state plans: a one-year extension (Summer 2017); and

• Multi-state plans: a two-year extension (Summer 2018).

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Benefits and Costs

• Nationwide, by 2030, this rule would help reduce CO2 emissions from 

the power sector by approximately 30% from 2005 levels.

• Also by 2030, reduce by over 25% pollutants that contribute to the soot and 

smog that make people sick. 

• These reductions will lead to public health and climate benefits worth 

an estimated $55 billion to $93 billion in 2030. 

• Proposal will avoid an estimated 2,700 to 6,600 premature deaths and 

140,000 to 150,000 asthma attacks in 2030.

• Health and climate benefits far outweigh the estimated annual costs of 

meeting the standards.

• Estimated at $7.3 billion to $8.8 billion in 2030. 

• Proposal protects children and other vulnerable Americans from the 

health threats posed by a range of pollutants.

• Move us toward a cleaner, more stable environment for future 

generations. 

• Ensures an ongoing supply of the reliable, affordable power needed for 

economic growth.

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Other Impacts

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Electricity bills down 

8% in 2030

$0

$20

$40

$60

$80

$100

$120

1990 1995 2000 2005 2010 2015 2020 2025 2030

Monthly Residential Electricity Bills (2011$)

Historical - Converted to 2011$ Base Case Clean Power Plan
After Proposal, Coal & Natural Gas Remain 

Leading Sources of Electricity Generation

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Each more than 30% of projected generation in 2030

Coal

31%

Natural Gas

32%

Other Fuel

37%
Other Impacts

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0

50

100

150

200

250

300

350

400

450

500

2012 2020 2030

Coal-Fired Generation Capacity (GW)

Year

Past and Projected Coal Generation 

in US

Base Case Proposal -- Option 1 Regional Proposal -- Option 1 State
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For More State-By-State Information

http://www.epa.gov/cleanpowerplan
Recent Developments

• The proposed rule and supporting technical information are available online at: 

http://www.epa.gov/cleanpowerplan

• The public comment period ended on December 1, 2014.

• EPA held four public hearings:

• July 29 Atlanta and Denver

• July 30 Washington DC

• July 31 Pittsburgh

• Almost 3,000 attendees, with more than 1,300 speakers

• So far, EPA has received more than 3.5 million comments on the proposal

• Notice of Data Availability (NODA)

• Supplemental Proposal for Indian Country and Territories

• Rate-to-Mass Technical Support Document

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Responding to Public Input: Notice of 

Data Availability

• Issued on October 28, 2014

• Purpose 

• Describe and seek comment on several ideas raised by multiple stakeholders 

• Bring these ideas to the attention of other stakeholders and the public so that they 

have the opportunity to consider them as the develop their comments. 

• Topics

• Glide path of emission reductions from 2020 to 2029

• Certain aspects of the building block methodology

• Stringency of building block 2

• Methodology for building block 3 and how building block 3 targets relate to 

compliance options 

• The way the state-specific CO2goals are calculated

• Goal-setting equation

• Alternatives to the 2012 data year

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Clean Power Plan Supplemental Proposal 

for Indian Country and Territories

•Issued on October 28, 2014

•Summary

• Propose Best System of Emission Reduction (BSER) and set goals for 

certain areas where we had limited information in June 2014.

• For Indian country, propose goals for each of the three areas of Indian 

country with affected EGUs: 

• Lands of the Navajo Nation, Ute Tribe of the Uintah and Ouray 

Reservation, and Fort Mojave Tribe

• For territories, propose goals for Puerto Rico and Guam only

• Uses same methodology as for states to determine the best system of 

emissions reduction and goals; applying four building blocks to 2012 

data.

•Comment period ended December 19, 2014

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Rate-to-Mass Technical Support Document

• Issued on November 6, 2014 in response to requests from states and 

other stakeholders.

• Provides two examples of how a state could translate its rate based goal 

to total metric tons of carbon (a mass-based equivalent). 

• The basic formula for translating from a rate-based goal to a mass-based 

equivalent is: 

Mass = CO2Emissions Rate * Generation

• In calculating a mass-based equivalent, EPA used each state’s proposed 

rate-based goal from the June 2nd proposal as the emissions rate. 

• The TSD describes two approaches conceptually and applies the 

calculation to an example state. 

• The first approach calculates generation from existing affected fossil fuel-fired 

sources using historical data. 

• The second approach calculates generation from existing affected and new 

fossil fuel-fired sources using a combination of historical and projected data. 

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By Summer 2016

State submits initial multistate plan and request for 2-

year extension

EPA reviews initial plan 

and determines if 

extension is warranted

by Summer 2017

State submits progress 

report of plan

by Summer 2018

States submits multistate plan

State submits Negative Declaration

State submits complete implementation Plan by Summer 2016

State submits initial Plan by Summer 2016 and request 1-year extension

State submits initial multi-state Plan by Summer 2016 and request 2-year extension

Emission 

Guideline 

Promulgation

Summer 2015

by Summer 2016

State submits negative 

declaration

EPA publishes FR notice

by Summer 2016

State submits plan

by Summer 2016

State submits initial plan 

and request for 1-year 

extension

EPA reviews initial plan and 

determines if extension is 

warranted

by Summer 2017

State submits complete plan

2015 2019

Proposed Implementation Timeline

Compliance 

period begins

2020

2020

EPA reviews plan and 

publishes final decision 

within 12 months on 

approval/disapproval

EPA reviews plan and 

publishes final decision 

within 12 months on 

approval/disapproval

EPA reviews plan and 

publishes final decision 

within 12 months on 

approval/disapproval

2016 2017 2018
Thank you!

Mike Gordon

215-814-2134

gordon.mike@epa.gov

Emily Linn

215-814-5273

linn.emily@epa.gov

Air Protection Division

US Environmental Protection Agency Region 3

1650 Arch Street

Philadelphia, PA 19103