By Jocelyn Durkay
President Donald Trump on Tuesday issued the Promoting Energy Independence and Economic Growth Executive Order “promoting [the] clean and safe development of our nation’s vast energy resources, while at the same time avoiding regulatory burdens that unnecessarily encumber energy production, constrain economic growth, and prevent job creation.”
Of greatest interest to states, the executive order directs the Environmental Protection Agency (EPA) to begin the process of reviewing (and potentially revising or rescinding) its Clean Power Plan Final Rule.
Should EPA decide to take any action, it would be accomplished via the Administrative Procedures Act and would likely take months, if not years, to complete the formal process.
Many of the actions described in the order either begin a formal administrative process to review and potentially revise regulations, or rescind climate related actions taken by President Barack Obama.
A complete overview of the EO can be found in this NCSL info alert.
Wasn’t there litigation too?
Yes, see State & Local Legal Center Executive Director Lisa Soronen’s blog on how the executive order may affect litigation.
What are states’ immediate reactions?
Forty-seven states have been involved in litigation over the Clean Power Plan—29 oppose the regulations while 18 states and Washington, D.C., support it.
Immediately following the executive order announcement, a coalition of attorneys general from 16 states and Washington, D.C, publicly supported and vowed to defend the Clean Power Plan. The 16 states include California, Connecticut, Delaware, Hawaii, Illinois, Iowa, Maine, Maryland, Massachusetts, New Mexico, New York, Oregon, Rhode Island, Vermont, Virginia and Washington.
Several other municipal and state coalitions released public statements on the executive order.
What are the consequences for states’ energy decisions?
Taking a step back from government actions, energy policy decisions occur in the larger context of interstate markets, global energy prices and increasing customer demands for lower carbon sources.
While the executive order may provide reprieve for states with coal generation in their current energy mixes, larger market forces—mainly cheaper and cleaner alternatives to coal—are gaining momentum. Price competition and aging coal fleets mean coal made up more than 80 percent of retired electricity generating capacity in 2015 and a majority share in 2016 as well, according the U.S. Energy Information Administration. This is a consequence of multiple circumstances, including required compliance with previous EPA regulations—not for carbon dioxide—and rapid rise in low cost natural gas electricity generation. The cost of wind and solar has continued to drop rapidly as well, increasing their market share.
In a recent survey, utility executives project coal generation’s downward trend to continue, but see the election of Trump as affecting the fuel’s outlook positively.
And what about state policies?
The Clean Power Plan’s absence could provide states and electric utilities with increased flexibility—but how that affects decisions may vary by state.
For example, states that supported the Clean Power Plan are continuing their carbon reduction efforts:
- Twenty states and Washington, D.C., have state-level greenhouse gas emission reduction efforts and 29 states and Washington, D.C., have renewable energy standards.
- California and Hawaii are considering legislation this session that would align state law with Obama-era federal environmental regulations.
- Cap-and-trade or carbon tax legislation has been introduced in California, Massachusetts, New Jersey, New Mexico, New York, Oregon, Rhode Island and Washington this session.
See NCSL’s webpage for state responses to the Clean Power Plan from 2014 to 2016.
What does this mean for future carbon emission regulations?
If the EPA begins formal action to rescind the Clean Power Plan regulations, it will take months or years to complete the process—and it will likely be followed by further litigation.
This is because the foundation of the Clean Power Plan is a 2009 endangerment finding by EPA, which determined carbon dioxide emissions endanger human health and mandate EPA regulatory action. This finding remains intact, leaving the possibility for future federal regulations on carbon dioxide.
The only thing that’s clear at this point is that it will be a long time before anything is set in stone.
Jocelyn Durkay is a senior energy policy specialist in NCSL’s Energy Program.