Rumor Has It: EPA Considers Dropping CCS from Carbon Pollution Standards

“Did you hear about Walter Peck?”

In January 2014, EPA proposed the Carbon Pollution Standards, a regulation that would require new coal-fired power plants to install carbon capture and sequestration (CCS) technology. Because CCS is not yet commercially viable, it is prohibitively expensive. As a result, EPA’s Carbon Pollution Standards rule effectively bans the construction of new coal-fired power plants. Needless to say, the regulation is very controversial. It is expected to be finalized this summer.

However, for months in D.C. there’s been circulating a rumor, to the effect that EPA is second-guessing the wisdom of its CCS mandate. Per these whispers, EPA is thinking of dropping a CCS requirement because the agency recognized that the Carbon Pollution Standards’ precarious legality jeopardized the Obama administration’s #1 climate change priority—the Clean Power Plan. The two regulations share a sequentially consequential relationship under the Clean Air Act, such that the Carbon Pollution Standard (a *new* source standard) must precede the Clean Power Plan (an *existing* source standard). If the former gets struck down in court, then it undercuts the latter. By dropping the CCS, EPA also drops a legal liability for the Clean Power Plan.

Yesterday, the rumor finally went public, in an InsideEPA article ($) by the always reliable Dawn Reeves, the opening of which I’ve excerpted immediately below

EPA Considers ‘Fallback Options’ For Dropping CCS From Power Plant NSPS

EPA is analyzing scenarios that would drop its contentious carbon capture and sequestration (CCS) mandate for new coal-fired power plants under its proposed greenhouse gas (GHG) standards for new power plants, amid growing agency concern that the rule is legally vulnerable because the technology may not be “adequately demonstrated” as the Clean Air Act requires since most of the demonstration projects cited in the proposal are stymied.

However, one informed source stresses that the agency has made no decision on whether to walk away from the heart of the new source performance standards (NSPS), but says a decision — one way or the other — will need to be made soon. The source says it remains unclear how EPA decision makers would respond to a final NSPS that does not require partial CCS for coal plants as the agency’s proposal does, and that it is also unclear whether the decision will be made by EPA or the White House.

“This is a big political question,” the source says. “I just don’t know whether they’re prepared to live with [the] criticism.”

Interestingly, EPA Administrator Gina McCarthy gave a full-throated defense of the agency’s proposal to require CCS last week during an exchange with Rep. Tim Murphy. This would seem to lend credence to the notion that the decision is still very much up in the air. See their back and forth at the 1:19:40 mark in the video below.