On August 21, 2018, the Trump Administration released its proposed replacement for the Clean Power Plan (CPP), called the Affordable Clean Energy (ACE) Rule. https://www.epa.gov/sites/production/files/2018-08/documents/frn-ace-proposal_8.20.2018.pdf

What’s interesting is that the USEPA’s own analysis open demonstrates that the ACE will result in fewer benefits than the rule it replaces, such as GHG and criteria pollutant emission reductions. So this is a “step backward” in terms of environmental impact. See the ACE Fact Sheet: https://www.epa.gov/sites/production/files/2018-08/documents/ace_overview_0.pdf. ACE is projected to reduce GHG emissions by one-tenth that the CPP is projected to: up to 30 million short tons of CO2e by 2025, compared to 300 million short tons under CPP. Interestingly, the Fact Sheet states that ACE will result in a “monetized domestic climate benefit” of $1.6 billion, compared to no rule at all. This is an interesting admission by this Administration that climate change is real and tangible and also that reducing GHG emissions will result in financial benefits. In addition, if these numbers are true, then reducing GHG emissions by 300 million tons should result in a greater economic benefit to the U.S. Why would the Administration go against such economic logic?

In addition, the Regulatory Impact Analysis prepared for the proposed ACE states that replacement will result in hundreds of additional premature deaths per year due to higher particulate emissions rates allowed by ACE. Most of these deaths will occur in U.S. regions downwind of coal-powered power plants. Proposing a rule change that will reduce reductions of GHG emissions (at a cost to our economy) and raise the number of premature deaths goes against USEPA’s stated priority of protecting public health.

Other changes in the proposed rule include:

• Reducing the USEPA’s authority to regulate and letting more GHG regulation in the hands of states, going against the recent recognition that impacts of air emissions do cross state lines and is, therefore, a federal responsibility.

• ACE applies only to coal-fired power plants, while CPP applies to both coal and gas-fired plants.

• ACE encourages improved efficiecy, rejects carbon capture and sequestration.

• Removal of cumulative GHG emission reduction targets or limits for power plants.

• Trading of GHG credits will not be allowed, although averaging among units in a single facility will be allowed. It is unclear how that may affect an existing trading program, like RGGI.

• While ACE contains USEPA-approved guidelines for reducing GHG emissions, a state’s standards may be less stringent than the USEPA guidelines. The state must explain why meeting USEPA guidelines for GHG emissions is a hardship.

The proposal to implement ACE was published in the Federal Register on August 31, 2018, beginning a public comment period. Comments are due by October 30.

CCES has the experts to help you develop an energy and a GHG emission reduction program to provide you maximum financial benefits and operating flexibility. Contact us today and we can help. karell@CCESworld.com or 914-584-6720.