CLEAN POWER PLAN

Proposal to Reduce 

Carbon Pollution From 

Existing Power Plants

Presentation to Congressional Staff

June 2, 2014
This Proposal Deals With the 

Source of GHG Emissions in th
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
This proposal will: 

• Reduce carbon pollution from existing power plants, for which t

currently no national limits.

• Maintain an affordable, reliable energy system.• By 2030, reduce nationwide carbon dioxide (CO2) emissions, fro

sector by approximately 30% from 2005 levels.

• Significant reductions begin by 2020. 

• Cut hundreds of thousands of tons of harmful particle pollution

dioxide and nitrogen oxides as a co-benefit. 

• Provide important health protections to the most vulnerable, su

children and older Americans. 

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

billion in 2030. 

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

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

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

already taking to address the risks of climate change. 

• Spur investment in cleaner and more efficient technologies, c

and driving innovation.

• Require a reasonable emission reduction glidepath starting in 

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

all emission reduction measures to be fully implemented in 2

• Recognizing that investments in infrastructure can take tim

place and 

• Avoiding stranded assets.

• Provide an array of tools states can use to formulate approvab

Summary (Cont’d)
Background: Clean Air Act Section 111

Best System of Emission Reduction

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

considered “add-on” control technologies – like scrubbers -- ttechnically feasible to deploy at virtually any facility. 

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

that are commercially available, technically feasible, and cost 

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

is generated, energy infrastructure, and other factors. 

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

factors in determining Best System of Emission Reduction in linterconnected 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.

Early Outreach Informed This Pro
State Actions are Foundation of 

• What we learned during the engagement process about what s

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 efficien• 27 states with energy efficiency standards or goals.
States and Communities with 

Programs That Reduce Carbon Pollu

State programs that reduce carbon include carbon cap and trade programs and energy efficiency and renewable energy standards or goals. 
EPA Sets the Goals
EPA Establishes a Goal for Every 

• EPA analyzed the practical and affordable strategies that states and u

already using to lower carbon pollution from the power sector. 

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

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 in

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

• Encompasses the dynamic variables that ultimately determine how much carb

emitted by fossil fuel power plants.

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

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

• The state goal rate is calculated to account for the mix of power sourc

state and the application of the “building blocks” that make up the beemission reduction.

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

Carbon emissions from affected power 

plants in an example state

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

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 

Examples 

Compliance 

1. Make fossil fuel-fired

power plants more efficient

Efficiency Improvements Efficiency improv

Co-firing or switcgasCoal retirementsRetrofit CCS (e.gTexas)

2. Use lower-emitting power 

sources more

Dispatch changes to existing natural gas combined cycle (CC)

Dispatch changenatural gas CC

3. Build more zero/lowemitting energy sources Renewable Energy Certain Nuclear New NGCC Renewables

Nuclear (new anNew coal with C

4. Use electricity more 

efficiently

Demand-side energy efficiency programs

Demand-side enprogramsTransmission effimprovementsEnergy storage
States Meet the Goals
When States Plan, They Can:

• Look broadly across the power sector for strategies that get re

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

calculate the goal, or on other measures that were not part of goal-setting analysis. 

• Invest in existing energy efficiency programs or create new on• Consider market trends toward improved energy efficiency an

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 proce• Design plans that use innovative, cost-effective regulatory stra• Develop a state-only plan or collaborate with each other to de

plans on a multi-state basis.

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

to help plants avoid “stranded investments.”
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 

the goal through whacollection of measureits particular circumstpolicy objectives. 

• State measures may i

in fact may be explicitdesigned to reduce, Cemissions from utilitieregional basis.

• EPA would support bu

existing reduction pro
States Choose How to Meet the G

• 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 

emitting plants.

*

• Market-based trading pro• Building new renewables• Dispatch changes.• Co-firing or switching to n• Building new natural gas 

cycle units.

* Measures EPA used in calculatgoals
Details About State Plans

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

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-

• Final goal -- meet in 2030 and thereafter.

• Individual and multi-state plans due June 30, 2016.

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

supported:

• Submit initial plan by June 30, 2016;• Individual state plans: a one-year extension (June 30, 2017); and• Multi-state plans: a two-year extension (June 30, 2018).
Benefits and Costs

• Nationwide, by 2030, this rule would help reduce CO

2 emiss

the power sector by approximately 30% from 2005 levels.

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

smog that make people sick. 

• These reductions will lead to public health and climate bene

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

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

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

• Health and climate benefits far outweigh the estimated ann

meeting the standards.

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

• Proposal protects children and other vulnerable Americans 

health threats posed by a range of pollutants.

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

generations. 

• Ensures an ongoing supply of the reliable, affordable power 

economic growth.
Other Impacts

Electricity bills dow

8% in 2030

$0

$20$40$60$80

$100$120

1990 1995 2000 2005 2010 2015 2

Monthly Residential Electricity Bills (20

Historical - Converted to 2011$ Base Case 
After Proposal, Coal & Natural Gas Rem

Leading Sources of Electricity Generatio

Each more than 30% of projected generation in 203

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NAME]

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Natural Gas

32%

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Other Impacts

0

50

100150200250300350400450500

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
For More State-By-State Informat

http://www.epa.gov/cleanpowerplan
Next Steps

• The proposed rule, as well as information about how to comm

supporting technical information, are available online at: 

http://www.epa.gov/cleanpowerplan

• EPA will hold 4 public hearings the week of July 28th in Denve

Pittsburgh and Washington, D.C.

• There will be a 120-day public comment period on the propos• Comments on the proposal should be identified by Docket ID 

EPA-HQ-OAR-2013-0602. 
By June 30, 2016

State submits initial multistate plan and request for 2-

year extension

EPA reviews initial plan 

and determines if 

extension is warranted

by June 30, 2017

State submits progress 

report of plan

by June 30, 2018

States submits multistate plan

State submits Negative Declaration

State submits complete implementation Plan by June 30, 2016

State submits initial Plan by June 30, 2016 and request 1-year extension

State submits initial multi-state Plan by June 30, 2016 and request 2-year extension

Emission 

Guideline 

Promulgation

June 1, 2015

by June 30, 2016

State submits negative 

declaration

EPA publishes FR notice

by June 30, 2016

State submits plan

by June 30, 2016

State submits initial plan 

and request for 1-year 

extension

EPA reviews initial plan and 

determines if extension is 

warranted

by June 30, 2017

State submits complete plan

2015 2

Proposed Implementation Timeli

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 rev

publishe

within 1

approva

2016 2017 2018