Understanding State Goals under the Clean Power Plan

The Clean Power Plan is about getting all the power we need, with less of what we don’t need: pollution.  Many people are now looking more closely at the plan and want to know a little more about how it all works, especially about what role their state will play in reducing carbon pollution.

Because the agency is looking for well-informed comments and input on the proposed plan, I wanted to explain a few key aspects of the proposal.  By answering a few questions such as – 1) what’s the baseline? 2) how is EPA using the Clean Air Act? 3) how can the power sector cut carbon pollution?  4) how did EPA set goals for each state? and 5) what flexibilities do states have? – I hope you’ll come away with a better understanding of the Clean Power Plan and how it will achieve significant air pollution reductions. As more questions come up, we’ll use this space and epa.gov/cleanpowerplan to answer them.  Now, on to the questions!

What baseline did EPA use to determine how much pollution must be reduced?

EPA did not set a baseline. Remember, the plan is about generating the power we need, but with less pollution.  So instead of setting a baseline, the Clean Power Plan works by setting state goals to reduce the “pollution-to-power ratio” of the covered fossil-fuel fired power plants in a given state.  EPA projects that by 2030, when states meet these goals, the U.S. power sector will emit 30 percent less carbon pollution than it did in 2005.  But 2005 – or any other year – is not used as a “baseline” year for a fixed percentage of reductions.  We are using that statistic only because people need to know how much pollution we’ll reduce by when and compared to what, so we’re just comparing where we will be in 2030 to where we were in 2005.

How does the Clean Air Act work to cut carbon pollution from existing power plants?

EPA is proposing carbon pollution guidelines using section 111(d) of the Clean Air Act.  Basically, this part of the law requires EPA to identify the best and cheapest ways to reduce pollution from a given source – in this case, power plants that burn fossil fuels.   The key to reducing carbon pollution from the power sector is to generate and use power more efficiently.  Put another way, the goal is to reduce the carbon pollution emitted for each megawatt-hour of electricity generated. That provides power with less pollution. The amount of carbon pollution per megawatt-hour produced is called an emission rate.  It is the rate at which pollution is emitted per unit of power generated.  If a source emits a lot of carbon dioxide but produces relatively little energy, then its “carbon intensity” is considered high. Using section 111(d) of the Clean Air Act, EPA is proposing that states develop plans to reduce the carbon intensity of the power sector.  The goal is not to limit the amount of power we produce.  It’s about reducing the overall amount of carbon pollution from power plants, while still producing the energy we  need.

How can the power sector reduce carbon emissions?

EPA found that there are a wide variety of commercially available, technically feasible, and cost-effective ways that states, cities and businesses across the country are already using to reduce carbon pollution from the power sector.  EPA identified four measures–that are the commonly used, technically sound,  affordable, and that result in significant reductions in carbon intensity.  They are – 1) improving efficiency at existing coal-fired power plants, 2)increasing utilization of existing natural gas fired power plants, 3) expanding the use of wind, solar, or other low- or zero-emitting alternatives, and 4) increasing energy efficiency in homes and businesses. By applying some or all of these measures a state can reduce the carbon intensity of its power system.  These aren’t the only approaches that states can use, but EPA determined that—taken together—they are the best system of emission reduction, as that term is defined in the Clean Air Act.

How did EPA set goals for each state?

By looking at the mix of power sources and the ability of each state to take advantage of any of the four carbon pollution reduction measures, the EPA calculated goals for each state. The proposed state goals are based on a consistent national formula and calculated using specific information about the state or its region’s individual power profile.  The result of the equation is the state goal.  Each state goal is a rate – a pollution-to-power ratio – for the future carbon intensity of covered existing fossil-fuel-fired power plants in a given state.  States can meet their goal using any measures that make sense to them—they do not have to use all the measures EPA identified, and they can use other approaches that will work to bring down that carbon intensity rate.  I hope this explanation makes clear that EPA is not setting goals based on percentage reductions against a baseline year. But when states meet their goals in 2030, EPA projects that the increased efficiency and reduced carbon intensity will result in a 30 percent less carbon pollution when compared with 2005 levels.

How do the state goals give states flexibility?

EPA has set a goal for each state based on an analysis of the best system of reductions, based on estimates of the potential in each state for efficiency improvements and increased utilization of cleaner generation.  Once the state has a goal, however, it is free to meet that goal in the way that works best for that state.  It can rely more or less heavily on specific measures such as efficiency or renewable energy, or even pursue others such as increases in transmission efficiency or new gas generation.  The state can also choose the policy or portfolio of policies that works best to achieve the goal.

Learn more about the Clean Power Plan

The Clean Air Act and the state planning process offer enough time and flexibility for every state to cut wasted energy, improve efficiency, and reduce pollution – while still having all the reliable and affordable power we need to grow our economy and maintain our competitive edge. In the coming months, we’ll be seeking comments and feedback on the proposed Clean Power Plan, and I encourage you to learn more and join the discussion: http://www2.epa.gov/carbon-pollution-standards

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