United States: President Obama Unveils Much Anticipated Climate Change Plan

On June 25, in a much anticipated speech at Georgetown University, U.S. President Obama unveiled The President's Climate Action Plan, a comprehensive strategy to reduce greenhouse gas emissions and prepare for the impacts of global warming. Frustrated by partisan gridlocks in Congress, Obama is using his executive powers to advance the policy landscape on climate change.

This blog post aims to highlight some of the salient aspects of the Plan. We will publish further posts on this topic as the Plan develops in the coming months.

The Plan rests on three key pillars: cutting carbon pollution, preparing the U.S. for the impacts of global warming and leading international efforts to combat climate change.

Cutting Carbon Pollution

In 2007, the U.S. Supreme Court, in Massachusetts v EPA, held that the Environmental Protection Agency has the authority to regulate greenhouse gases under the Clean Air Act. As such, in a controversial move, Obama is directing the EPA to impose carbon pollution standards on new and existing power plants. Obama has set a deadline of June 1, 2014 for the EPA to issue its proposals and June 1, 2015 for the EPA to issue final standards, regulations and guidelines. Currently, power plants account for approximately 33% of all U.S. greenhouse gas emissions, with no federal rules governing the amount of carbon pollution existing power plants can release.

Moreover, the Plan calls for several other significant action items, including an end of government subsidies to U.S. companies that build coal plants overseas, a doubling of renewable energy generation by 2020, the issuance of permits for 10 gigawatts of renewable energy sources on public lands by 2020 and an increase in funding for clean energy technologies in the Fiscal Year 2014 budget by 30%, to approximately U.S.$7.9 billion.

Preparing the U.S. for the Impacts of Climate Change

The impacts of climate change have been felt in the U.S. for quite some time; last year was the warmest year ever recorded, and the 12 hottest years on record have all come in the last 15 years. In fact, the Sustainable Energy and Environment Coalition of the House of Representatives suggests that extreme weather events stemming from climate change in 2011 and 2012 alone cost U.S. taxpayers approximately U.S.$136 billion, or U.S.$1,610 per taxpayer. To this end, the Plan seeks to "prepare for the impacts that are too late to avoid."

Obama will direct federal agencies to support climate-resilient investments, establish a task force on climate preparedness and boost the resiliency of buildings and infrastructure, among other things, that will help prepare the U.S. for the adverse effects of climate change.

Leading International Efforts

Recognizing that no single country can combat climate change alone, the Plan highlights the importance of working closely with large foreign emitters of pollution to address climate change on a global scale. For example, the U.S. will work with its trading partners to initiate negotiations at the World Trade Organization for global free trade in environmental goods and clean energy technologies. Obama also plans to eliminate U.S. fossil fuel tax subsidies in the Fiscal Year 2014 budget.

Debate Ensues

Obama's Plan is not without a long list of critics. Most notable is the fierce opposition from the U.S. coal industry, now facing great uncertainty given the looming regulations to be imposed on the country's power plants. Obama is even accused of waging a war on coal. House Speaker John Boehner, for example, called the Plan "essentially a national energy tax", adding that it would be especially harmful for jobs in his home state of Ohio, where the majority of electricity is generated by coal. The Plan will put "thousands and thousands of Americans out of work", he said, while increasing the costs of electricity to consumers.

Obama, on the other hand, remains firm in his belief that moving away from coal to cleaner sources of energy will not kill jobs nor hurt the economy. Calling his critics' outcries "tired excuses for inaction", Obama's confidence in American businesses' ability to innovate was evident throughout his speech, where he argued that "a low-carbon clean energy economy can be an engine of growth for generations to come."

Canada's Approach

Obama has certainly set the bar high for Canadian Prime Minister Stephen Harper, who had previously elected to take a wait-and-see approach prior to committing further action on climate change. In fact, the EPA's new mandate will likely put the U.S. far ahead of Canada in terms of addressing power plant emissions. Currently, Canadian rules allow any coal plant built after 1975 to remain operational until 2030 without any emissions restrictions, at which time they would have to close unless equipped with carbon capture and storage technology. Under the Plan, all operational coal power plants will be subject to EPA regulation starting in early 2015.

It will be interesting to see how the Plan influences Canadian action and policy development on climate change. The ball is in our court now. We will report on any similar policies that follow the announcement of the U.S. Plan by the Canadian federal government.

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