The Supreme Court and CO2 Regulation

David Bernell

 

The Supreme Court decision in West Virginia v. the EPA said that the Clean Power Plan established under the Obama Administration exceeded the authority of the EPA to regulate CO2 emissions from existing power plants. It did not take away the authority of the EPA to regulate greenhouse gas emissions, but it placed constraints so that regulations can only cover individual power plants, not the entire electric power sector as a whole.

 

The Clean Power Plan never went into effect. In 2016 the Supreme Court put a stay on the rule until the courts could sort out the question of the EPA's legal authority. The issue became moot because the Trump Administration scrapped the Clean Power Plan in favor of its own rule on CO2 emissions from power plants: the Affordable Clean Energy (ACE) Plan. But the West Virginia case continued to work its way through the courts. Then the day before Trump left office, the DC Circuit Court invalidated ACE. What this meant is that the incoming Biden Administration had a clean slate when it came to regulating CO2 emissions from existing power plants. 

 

The Biden Administration still hasn't proposed a specific CO2 regulation for power plants, and whatever it chooses to propose will now be constrained by the Supreme Court ruling.  

 

However, in spite of the disappointment expressed by many at the Supreme Court ruling, it's unlikely that the ruling will have much of an impact on CO2 emissions. That's because coal remains a bad bet. First, solar, wind and natural gas make more sense economically. Second, the regulatory burden on coal isn't likely to get any lighter over the long term. And third, the public in general prefers cleaner energy sources over dirtier ones -- poll after poll confirms this. 

 

Two graphs from the US Department of Energy tell the story. The first shows all the planned closures of power plants in 2022. About 85% all of the generating capacity going away comes from coal plants. 

 

 

 

 

 

 

 

 

 

 

The second graph, on the other hand, shows all the planned power plant additions in 2022. Solar, natural gas, and wind make the cut. There isn't a single coal plant in the bunch.

 

 

 

 

 

 

 

 

 

This isn't just for one year. It's not an anomoly. This has been the case for several years, and the plans for the next several years look similar. It's because coal plants are a not a promising investment. If you had money to invest, would you put it into building a coal plant? I didn't think so.  

 

Trump couldn't save coal plants, the Supreme Court won't either. The market is killing them off.