With or Without the Clean Power Plan, It’s Up to the States to Transition to Clean Energy

Environmentalists are understandably wringing their hands over the likely post-election demise of the Clean Power Plan, the Obama administration's rule to reduce greenhouse gas emissions from power plants, which are the nation's single biggest source of carbon emissions. But, with or without the Clean Power Plan (the Plan), the states hold the cards to a clean energy transition. 

Even if the fossil fuel interests intent upon perpetuating a profitable status quo end up dominating Congress and federal energy and environmental agencies, states will still have the power to steer the energy sector away from fossil fuels. By promoting renewable energy, like solar and wind power, and by promoting energy efficiency, states can and should lead the way. In so doing, they can transform the energy sector from a system that benefits vested fossil fuel interests and toward a sustainable infrastructure that benefits everyone through new jobs, cleaner air, and reduced risks from climate change. 

To be sure, the Clean Power Plan was an important initiative, and losing it will be a blow to national climate policy. Its most important feature was its recognition that reducing emissions from sources requires more than tinkering with pollution controls at existing power plants. In developing the Plan, the Environmental Protection Agency (EPA) recognized that, due to the interconnected nature of the transmission grid, power plant emissions could also be reduced by shifting power generation from the most-polluting facilities, usually coal-fired power plants, to less-polluting facilities, like underutilized natural gas plants, and by developing zero-emission sources, like wind and solar power. EPA gave the states, which were responsible for implementing the Clean Power Plan, considerable flexibility in choosing among these mechanisms to meet the targets EPA calculated for each state. The Plan provided a national framework for addressing existing source emissions and signaled the national commitment to mitigating climate change.  

So will the expected collapse of the Clean Power Plan prevent the achievement of necessary emissions reductions? Not necessarily. First, the Clean Power Plan did not ask for much; real progress has always relied on states and regional entities doing more. And second, the Plan arguably laid a foundation that can help states and regions achieve reductions as great as or greater than the Plan required. 

Particularly over the next decade, the current trend away from coal, driven by market forces, is expected to reduce emissions at least as much as the modest targets set by the Plan. Utilities are shutting down or reducing generation at coal-fired power plants as natural gas becomes a cheaper alternative and as favorable tax incentives spur investments in renewable energy. 

Moreover, there is a significant gap between the Plan's targets and the reductions EPA thought were achievable. So, even with the Plan in place, it was up to the states to fill that gap. EPA's research indicated that existing, underutilized, natural gas plants and new renewable energy resources could replace most existing coal-fired power generation in the Western Interconnection, the energy grid serving the western states. However, the Plan did not impose region-specific targets; instead, EPA took a uniform approach that reflected the more restricted opportunities available in the eastern states, not the greater opportunities available in the west. So, with or without the Plan, it is up to the western states to take advantage of the opportunities EPA identified but did not include in the Plan. 

Ironically, the demise of the Plan could actually increase the efficacy of state actions that go beyond the reductions the Plan anticipated. The Plan encouraged interstate emissions allowance trading, in which states reducing emissions by more than required could sell allowances, and states that chose to maintain emissions could purchase allowances to cover their emissions rather than reducing them. The catch is that if one state's extra reductions led to more emissions in other states, then that state's extra reductions might not have any effect. If the Plan falls, however, so will the associated interstate trading, so one state's extra reductions won't simply enable more emissions in other states. This is not to say that we're better off without the Clean Power Plan or that trading would not have had some important benefits, but it is worth noting this potential silver lining. 

Moreover, even if the Plan is axed, the planning processes, inter-agency coordination, and public participation it triggered established connections and momentum that could continue in some states. Most states responded to the Plan by taking a new approach to pollution control, one that recognizes that reducing energy sector emissions requires not just imposing pollution controls, but also addressing the underlying energy supply decisions that determine where electricity is generated and what facilities are built. The Plan led to unprecedented planning and coordination between control-focused environmental agencies and supply-focused public utility commissions. In addition, many states initiated public hearings to comply with Plan requirements. Even if formal implementation planning stops, the interagency relationships and coordination, and the increase in public awareness, could spark ongoing environmental and energy planning. 

Lastly, the Clean Power Plan reflects an awareness of the regional nature of the grid and highlights the importance of regional approaches to energy supply. Although the demise of the Plan will reduce the pressure to engage in regional approaches, interested states have the potential to continue regional planning efforts and to make the most of regional, not just state-based, reduction opportunities.  

Although the Clean Power Plan no longer creates an imperative for clean energy planning, it highlights the opportunities that states could achieve, on their own and in regional collaborations – whatever happens in Washington. Rather than maintaining reliance on heavily-polluting fossil fuels that cause climate change and impair public health, states have the authority and capacity to steer themselves to a more sustainable energy future. They can engage in comprehensive planning that shifts to clean energy, reducing greenhouse gases and other harmful emissions, and that helps citizens transition from jobs in the fossil fuel industry to new jobs in a cleaner energy economy. 

Kaswan is the co-author, with Kirsten Engel, of the CPR paper, Untapped Potential: The Carbon Reductions Left Out of EPA's Clean Power Plan.