The Environmental Protection Agency ("EPA") has
proposed regulations of carbon emissions from new fossil fuel-fired
power plants under the authority of Section 111(b) of the Clean Air
Act ("CAA"). The agency proposes one set of standards for
gas-fired units and second pair of alternative standards for
coal-fired units. Most new combined cycle gas-fired units already
meet the proposed standard for gas-fired units. By contrast,
neither recently built nor recently proposed coal-fired units can
meet EPA's proposed standard without using carbon capture and
sequestration, a technology that some electric utilities are likely
to assert has not yet been deployed cost-effectively on a
commercial basis. These new source performance standards apply from
the date of publication of the proposal in the Federal Register,
requiring proposed coal plants that have not commenced construction
as of publication to meet the new performance standard.
President Obama also has directed EPA to issue emissions guidelines
for existing sources under Section 111(d). EPA rarely uses this
authority, and there are significant legal obstacles to the
imposition of direct controls on existing sources. First, it is not
at all clear that EPA has any authority under Section 111(d) to
regulate electrical generating units. Specifically, conflicting
statutory language in Section 111(d) disallows issuance of
standards for sources in categories with already existing hazardous
air pollutant standards, and electric generating units are such a
category. EPA takes the position that the specific pollutant has to
be regulated as part of the Section 112 category, which would allow
simultaneous regulation of the sources. However, it is not clear
that EPA's interpretation is consistent with the statutory
language.
Even if Section 111(d) is available to regulate greenhouse gases
from existing sources, the CAA leaves significant discretion to
states to implement the guidelines issued by EPA. Many states
already have programs in place to address greenhouse gas emissions,
and these states will champion flexibility to keep their existing
rules. Other states that do not currently have programs may also
want to take advantage of the inherent flexibility in Section
111(d) to develop rules that best suit the state's particular
circumstances. Together, the statutory language and state
flexibility indicate a lengthy process for comprehensive regulation
of greenhouse gases from existing sources.
This White Paper describes the operation of CAA Section
111 as a whole. Next, it explains the important aspects of two
major provisions, Section 111(b) and Section 111(d), by explaining
EPA's authority and responsibilities under the relevant
provisions and related regulations. As this White Paper
explains the statutory and regulatory mechanisms of Section 111, it
also highlights portions of the regulatory process that are
significant considering the proposed rule for new sources and
President Obama's direction to develop regulations for existing
sources.
Click here to view the White Paper.
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