US to weaken carbon limits on new coal plants: Update

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President Donald Trump's administration is trying to make it cheaper to build coal-fired power plants by rolling back a rule that effectively required new plants to capture and store a portion of their carbon dioxide emissions.

The US Environmental Protection Agency (EPA) today proposed to relax a 2015 emissions rule that industry saw as a de facto ban on new coal plants, given the high cost of building and operating carbon capture equipment. The revised emission limit would be 35-43pc weaker than existing standards for most coal plants and could be achieved without capturing any carbon emissions.

EPA acting administrator Andrew Wheeler said the proposal would replace "onerous regulations" with achievable standards that would enable the construction of coal plants if there were enough market demand. Relaxing the existing rule would also improve public health, he said, by keeping the price of electricity used for heating, cooling and other uses affordable across the US.

"Coal is one of the cheapest forms of electricity," Wheeler said today at an event at EPA headquarters in Washington, DC. "And having cheap electricity, affordable electricity, helps human health absolutely."

The proposal marks another attempt to deliver on Trump's campaign pledge to protect coal jobs. But even EPA's own regulatory analysis projects that no new coal plants are likely to be built through 2035, as market forces support the construction of new gas plants and renewables. Wheeler said it was not EPA's role to decide what types of power plants will be built.

"Whether or not new coal plants will be built in this country is a decision that the utility industry will make," Wheeler said. "We are not trying to pick winners or losers."

The existing 2015 standards were issued under former president Barack Obama and required new coal plants to achieve a carbon dioxide emissions rate of 1,400 lbs/MWh. That rate would require conventional coal plants to capture about 35pc of their carbon, which could then be used for enhanced oil recovery or stored deep underground in aquifers.

The revised standards proposed today instead set a carbon dioxide emissions rate of 1,900 lbs/MWh for large "supercritical" coal plants, 2,000 lbs/MWh for subcritical coal plants, or a 2,200 lbs/MWh emissions rate for plants that burn coal refuse. EPA today proposed similar emission standards for coal-fired power plants that are heavily modified, which would trigger the regulations.
Electric utilities and independent power generators have shown almost no interest in building coal plants because of their high costs compared with other resources and the looming prospect of policies such as a carbon tax. But environmentalists say although market forces make it unlikely coal plants will be built, the weaker standard still sends the wrong signal about climate change.

"This is just one more foolhardy move by a misguided administration that will be judged harshly by future generations," Natural Resources Defense Council senior strategic director David Doniger said.

The all-in cost of electricity from a new coal plant in the US is expected to range between $60-$143/MWh over its lifetime, according to a study published by the financial consultancy Lazard that was updated last month. That compares to $41-$75/MWh for a combined-cycle natural gas plant, $29-$56/MWh for onshore wind and $32-$44/MWh for utility-scale solar photovoltaic.

The proposal was cheered by Republicans who accused Obama's EPA of overreaching with its earlier carbon restrictions on coal plants. US Senate majority leader Mitch McConnell (R-Kentucky), whose state accounted for 5pc of US coal production last year, said the Obama-era regulations would have made it "nearly impossible" to build coal plants.

"This is a crucial step toward undoing the damage and putting coal back on a level playing field," he said.

EPA's new proposal will be less consequential than a separate agency proposal, named the Affordable Clean Energy rule, that would weaken greenhouse gas restrictions that apply to the existing fleet of coal-, gas- and oil-fired power plants. That rule is projected to increase US power sector carbon emissions by 3pc by 2030, when compared with the emission cuts that would occur if regulations issued under Obama were enforced.

The proposal's release comes a day after the release of research showing a surge in climate-warming emissions around the globe. Carbon dioxide emissions from fossil fuels are set to increase by 2.7pc globally and 2.5pc in the US this year, according to research from a major scientific initiative named the Global Carbon Project. Coal last year was the largest source of fossil fuel emissions at 40pc of the total.