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New Rules Will Limit Coal Power Plant Emissions, But Lawsuits Expected

The U.S. Environmental Protection Agency finalized four rules on April 25 to reduce air and water pollution in the power sector that officials say would collectively result in hundreds of billions of dollars in economic and public health benefits.

But legal opponents are already lining up to challenge the most controversial of the four—which would require existing coal-fired and all new natural gas-fired plants to reduce carbon emissions by 90% or shut down.

EPA Administrator Michael S. Regan said at an event at Howard University in Washington, D.C., that the rules will not only make good on Biden administration goals to reduce carbon emissions—and premature deaths and hospital visits caused by poor air quality, particularly in environmental justice communities—but also that they will provide the certainty power companies have consistently sought.

Regan said he committed at energy industry conference CERAWeek in 2022 to work in a “clear, transparent and inclusive manner,” and in doing so, allow power companies “to make strategic, smart investments to continue to deliver reliable electricity for all Americans.”

The rules tighten and update the Mercury and Air Toxic Standards, known as MATS. They will reduce by more than 660 lb annually the amount of pollutants permitted to be discharged in wastewater from coal-fired plants, and place new requirements on coal ash impoundments, said EPA.

But the rule generating the most attention will require power plant owners to reduce carbon emissions at existing coal-fired plants and new gas-fired plants using the best available technologies. The best available technology to achieve required reductions is carbon capture and sequestration (CCS), EPA said in the rule. Agency officials say that improvements in CCS technology have demonstrated that it is now technically feasible. Also, tax incentives through the 2022 Inflation Reduction Act, as well as billions of dollars in funding through the 2021 infrastructure law specifically for CCS projects, will help offset many of the costs associated with the technology, EPA said.

Some industry groups dispute that CCS is commercially viable.

Dan Brouillette, Edison Electric Institute president and CEO, said, “While we appreciate and support EPA’s work to develop a clear, continued path for the transition to cleaner resources … CCS is not yet ready for full-scale, economy-wide deployment, nor is there sufficient time to permit, finance and build the CCS infrastructure needed for compliance by 2032.”

But others contend the technology is primed and ready for commercial-scale deployment. “Post-combustion capture, sequestration and storage is adequately demonstrated and cost reasonable on coal and gas-fired power plants,” said John Thompson, technology and markets director at the non-partisan Clean Air Task Force. “EPA correctly selected it to form the basis of emissions limits.”

Battelle, a global R&D firm, says CCS has been successfully demonstrated in large storage projects around the world, including the Sleipner project in Norway; the Quest facility in Alberta that has been in operation since 2017; and through the Midwest Regional Carbon Sequestration Partnership, which Battelle led from 2003 to 2021.

Jason Rowell, a vice president involved in new energy solutions at Black & Veatch, said in an email that his firm is involved with multiple clients on various stages of feasibility, front-end engineering design (FEED) studies involving carbon capture utilization and storage (CCUS). “Clients are certainly interested in CCUS technology,” Rowell said. “The regulations announced by EPA simply mean we must continue this effort with our clients and partners to ensure carbon capture technology continues to advance to the point where its value to the lifecycle cost of a power plant is economically viable."

High-profile Opposition

West Virginia Attorney General Patrick Morrissey, who successfully litigated in the US Supreme Court, West Virginia v. EPA, the 2022 case that challenged EPA authority to regulate power plant greenhouse gas emissions, issued a statement that he will work with industry to fight the new rule. Sen. Shelley Moore Capito (R-W.Va.), ranking member of the Senate Environment and Public Works Committee, said in a statement that she plans to lead an effort—through a Congressional Review Act resolution of disapproval in coming weeks—to overturn what she terms President Biden’s “illegal” attempt to close power plants.

The National Rural Electric Cooperative Association, a trade group with about 900 local electric cooperative members, described the path outlined by EPA as “unlawful, unrealistic and unachievable,” and pointed to analyses from the federal Energy Information Administration and the North American Electric Reliability Corp. that suggest that demand for power will only continue to escalate at the same time many plants will be shuttered.

Many environmental groups and advocates say EPA was careful to make sure that it was on solid legal ground in crafting the power plant rule. In the West Virginia v. EPA case, the majority opinion by Supreme Court justices concluded that EPA lacked the authority to require coal plants to switch to different types of power generation.

According to Frank Sturges, an attorney at Clean Air Task Force, EPA is exercising legal authorities it has under Section 111 of the federal Clean Air Act for the new rule. The group “will vigorously defend this rule against any court challenges and work with states on implementation,” he said in a statement.