Assessing the Final Clean Power Plan: Emissions Outcomes
The U.S. Environmental Protection Agency’s (EPA) Clean Power Plan (CPP) is the most significant greenhouse gas (GHG) policy ever undertaken in the United States, and is expected to achieve significant emission reductions by the time it is fully implemented in 2030. However, calculating the ultimate emissions-abatement potential is more difficult than simply adding up the state reduction targets. While the EPA has set a floor on cumulative emissions from existing fossil-fuel-fired power plants, it has not set a ceiling, and projecting the actual emissions outcome on a national level is not straightforward due to the flexibility states have in implementation.
In this note, we seek to deepen the understanding of the potential emissions outcomes of the CPP and what factors could influence that outcome. We start by explaining the primary factor that has the potential to undermine EPA’s emissions floor—leakage—and how EPA is attempting to address this issue. We then turn to a quantitative analysis of two potential pathways for state implementation plans (SIPs) under optimal implementation conditions. Bearing in mind that optimal implementation is unlikely, we also explore key drivers and decisions that could result in emissions that are higher or lower than our initial projections.
Key messages from our work include:
- Both rate-based and mass-based implementation achieve similar levels of cumulative abatement under optimal scenarios.
- Mitigating leakage—defined as the migration of emissions from covered to non-covered sources—is rightly recognized by EPA as an important issue to be addressed in CPP implementation. The environmental integrity of the rule could hinge on the effectiveness of leakage-mitigation measures expected in the final model rule and federal implementation plan (FIP).
- In addition to leakage, other non-optimal implementation conditions such as significant implementation delay, mismatched and complex state plan choices, and nuclear retirements could all impact overall emissions abatement achieved by the CPP.