Publications

In May 2023, EPA proposed new limits for carbon dioxide emissions from fossil fuel-fired power plants. The proposed rule reflects a decade of careful development from EPA and embraces an approach consistent with the Supreme Court’s ruling in West Virginia v. EPA. In order to follow that approach, EPA based the limits for certain natural gas-fired turbines on the emission reductions achievable through hydrogen co-firing (i.e., burning a blend of natural gas and hydrogen). Unlike fossil fuels, hydrogen does not release CO2 when burned, but producing hydrogen can cause significant greenhouse gas (GHG) emissions depending on how its produced. Given these potential emissions, it is important to consider what type of hydrogen a power plant will co-fire with—otherwise this approach to reducing emissions could exacerbate climate change. This report explains the role of hydrogen co-firing in EPA’s proposed rule, discusses how EPA should design its final rules to achieve the specified GHG-reduction goals, and highlights additional actions that EPA and other regulators can take to further minimize the emissions (and the resulting climate harm) from hydrogen co-firing.

Governments are catching up with economic theory and practice by increasingly integrating ecosystem service values into national planning processes, including benefit-cost analyses of public policies. Such analyses require information not only about today’s benefits from ecosystem services but also on how benefits change over time. We address a key limitation of existing policy guidance, which assumes that benefits from ecosystem services remain unchanged. We provide a practical rule that is grounded in economic theory and evidence-based as a guideline for how benefits change over time: They rise as societies get richer and even more so when ecosystem services are declining. Our proposal will correct a substantial downward bias in currently used estimates of future ecosystem service values.

Multiple federal and state regulators must coordinate their efforts to ensure electric grid reliability, particularly during a period of major transition, and it is important to understand what role each of them plays. This report reviews the respective roles of FERC, RTOs/ISOs, other transmission operators, state public utility commissions, and state environmental regulators. EPA’s duty to reduce GHG emissions that endanger public health and FERC’s duty to steward grid reliability will require them to coordinate each other’s respective expertise as they work with RTOs/ISOs, state regulators, and utilities to implement EPA rules.

Gas provides nearly a quarter of the world’s total energy supply. As part of that supply chain, gas is shipped between continents in the form of liquefied natural gas (LNG). The United States is now the world’s largest LNG exporter following a surge in gas exports since 2016, but these exports have generated controversy due to their climate effects.This policy brief provides an analysis to support an effort to balance the full range of impacts from LNG exports. Using DOE’s own published studies, we compare the climate cost per unit of LNG export to the economic benefit (measured using consumer welfare). We find that climate costs likely exceed economic benefits. While the precise difference depends on several factors, gross climate damages greatly exceed economic benefits under all scenarios evaluated. These findings provide useful insights as DOE prepares to re-evaluate the LNG export program.

Natural gas plays an outsized role in the U.S. economy. Under the Natural Gas Act, the Federal Energy Regulatory Commission (FERC or the Commission) is responsible for overseeing the orderly development of interstate natural gas pipelines, which facilitate the transmission of natural gas throughout the country. FERC can approve the pipeline only if it finds that it is required by the “public convenience and necessity.” Although FERC should consider a range of factors to determine whether a pipeline will serve the public interest, in practice, it looks primarily to the contracts between a developer and its customers for the purchase of pipeline capacity. If a developer can demonstrate that there is a party willing to pay to use its pipeline, FERC rarely asks questions and almost always finds “public” need. This pipeline-by-pipeline approach to natural gas transmission build-out leads to the construction of unnecessary, underused pipelines, which in turn increases ratepayer costs and decreases consumer welfare. Climate change further increases the risk that pipelines will become obsolete as cities and states move toward electrification. Relying on economic theory, legal history, and policy analysis, we make the case in this paper—pulished in the Columbia Journal of Environmental Law— for FERC’s adoption of regional gas transmission planning.