The federal regulation of greenhouse gases from coal-powered plants called “New Source Performance Standards” has been delayed several times but is now set to be released in early 2012.
We submitted a detailed letter today in the hopes of influencing the proposal. We strongly suggest not grandfathering existing plants under the rule. Doing so can have the unintended effect of nullifying the regulation altogether.
Grandfathering requires different standards for new and existing plants, which can make new construction relatively more expensive while keeping an older plant in operation becomes relatively cheaper. This “old plant effect” creates problematic incentives that delay the timely closure of old, inefficient facilities, possibly leading to greater overall emissions than an absence of regulation entirely.
There are further steps the EPA could take to maximize net benefits. As discussed in our letter, these include establishing NSPS for natural gas-fired power plants as well as coal-fired power plants and including flexible compliance mechanisms in the final rule so that businesses can identify and take advantage of low-cost emissions reduction opportunities.
Courts have ordered EPA to issue these rules because public health and welfare is at stake. It would not make sense to implement them in a way that works against the desired outcome—cleaner air.