Obama rule for power plants to compel steeper emissions cuts

WASHINGTON | Aiming to jolt the rest of the world to action, President Barack Obama moved ahead Sunday with even tougher greenhouse gas cuts on American power plants, setting up a certain confrontation in the courts with energy producers and Republican-led states.

The Obama administration estimated the emissions limits will cost $8.4 billion annually by 2030. The actual price won’t be clear until states decide how they’ll reach their targets. But energy industry advocates said the revision makes Obama’s mandate even more burdensome, costly and difficult to achieve.

“They are wrong,” Environmental Protection Agency Administrator Gina McCarthy said flatly, accusing opponents of promulgating a “doomsday” scenario.

Last year, the Obama administration proposed the first greenhouse gas limits on existing power plants in U.S. history, triggering a yearlong review and more than 4 million public comments. On Monday, Obama was to unveil the final rule publicly at an event at the White House.

The final version imposes stricter carbon dioxide limits on states than was previously expected: a 32 percent cut by 2030, compared to 2005 levels, the White House said. Obama’s proposed version last year called only for a 30 percent cut.

Immediately, Obama’s plan began reverberating in the 2016 presidential race, with Hillary Rodham Clinton voicing her strong support and using it to criticize her GOP opponents for failing to offer a credible alternative.

“It’s a good plan, and as president, I’d defend it,” Clinton said.

But Republican presidential candidate Marco Rubio, a Florida senator, predicted electricity bills would go up for millions of Americans and called Obama’s policies on power plants “catastrophic.”

“They will do nothing to address the underlying issue that they’re talking about, because as far as I can see, China and India and other developing countries are going to continue to burn anything they can get their hands on,” Rubio said at a conservative conference Sunday organized by billionaire industrialist Charles Koch.

Obama’s rule assigns customized targets to each state, then leaves it up to the state to determine how to meet them. Prodded by Senate Majority Leader Mitch McConnell, R-Ky., a number of GOP-led states have said they simply won’t comply. If states refuse to submit plans, the EPA has the authority to impose its own plan, and McCarthy said the administration would release a model federal plan that states could adopt right away.

“They don’t have to use our plan. They can cut carbon pollution in whatever way makes the most sense of them,” she said.

Another key change to the initial proposal marks a major shift for Obama on natural gas, which the president has championed as a “bridge fuel” whose growing use can help the U.S. wean itself off dirtier coal power while ramping up renewable energy capacity. The final version aims to keep the share of natural gas in the nation’s power mix at current levels.

Under the final rule, states will also have an additional two years — until 2022 — to comply, yielding to complaints that the original deadline was too soon. They’ll also have an additional year to submit their implementation plans to Washington, the White House said.

In an attempt to encourage states to take action earlier, the federal government plans to offer credits to states that boost renewable sources like wind and solar in 2020 and 2021. States could store those credits away to offset pollution emitted after the compliance period starts in 2022.

Scott Segal, a lobbyist with the firm Bracewell and Giuliani who represents utility companies, said 20 to 30 states are on track to join industry groups in challenging the rule in court as soon as it’s formally finalized. The Obama administration has a mixed track record in fending off legal challenges to its climate rules.

In Congress, GOP leaders were weighing various legislative maneuvers to try to block the rule, although those efforts face a steep hurdle to overcome Obama’s veto.

By clamping down on emissions, Obama is also working to increase his leverage and credibility with other nations whose commitments he’s seeking for a global climate treaty to be finalized later this year in Paris. As its contribution to that treaty, the U.S. has pledged to cut overall emissions 26 percent to 28 percent by 2025, compared to 2005.

“We’re positioning the United States as an international leader on climate change,” said Brian Deese, Obama’s senior adviser.

Power plants account for roughly one-third of all U.S. emissions of the heat-trapping gases blamed for global warming, making them the largest single source.