Assessing the Final Clean Power Plan: Key Changes Relative to the Draft Rule and Their Implications for Stringency

On August 3, 2015, the Environmental Protection Agency released the final Clean Power Plan (CPP), a regulatory action under the Clean Air Act (CAA) that establishes guidelines for states to limit carbon dioxide emissions from existing power-generation units. The plan differs in a number of important ways from a draft version released in June 2014. This research note, the first in a series on the final CPP from CSIS and Rhodium Group, outlines the key changes between the draft and final rules and analyzes the impact of those changes in terms of stringency—that is, the emission reductions required by the rule. A few key takeaways:

• The final rule adheres more closely to traditional regulatory approaches under the CAA’s Section 111 and eliminates some of the more novel regulatory proposals of the draft rule.
• The rule retains significant flexibility for states to craft an implementation plan tailored to their specific circumstances.
• In aggregate, the emission-performance targets that states are required to achieve in 2022 are higher than in the draft rule but the 2030 standard is stricter compared to the draft. This may lead to higher cumulative greenhouse gas emissions compared to the draft; however, ultimate emissions reductions and energy-sector impacts are highly dependent on state-level implementation decisions as well as technology and fuel costs.