| WASHINGTON, June 2
WASHINGTON, June 2 The U.S. power sector will
need to emit 30 percent less carbon dioxide by 2030 than it did
in 2005, according to new federal regulations - the centerpiece
of the Obama administration's climate change strategy - to be
unveiled on Monday.
The Environmental Protection Agency's proposal is one of the
most significant environmental rules proposed by the United
States, and could transform the power sector, which relies on
coal for nearly 38 percent of electricity.
The plan has come under pre-emptive attack from business
groups and many Republican lawmakers as well as Democrats from
coal-heavy states like West Virginia. But as details leaked out
on Sunday, it looked less restrictive than some had feared, with
targets arguably easier to reach.
The Environmental Protection Agency (EPA) is expected to set
separate targets for each state to hit, first in 2020 and then
in 2030, with different starting points based on their current
electricity generation mix and other considerations.
"The sum of all the emissions when sources meet the state
targets (in 2020) works out to 26 percent less than the power
sector emissions in 2005," said one person who was briefed on
By 2030, carbon emissions from power plans should have
fallen by 30 percent.
States will be given several ways to achieve their emission
targets. Those include improving power plant heat rates; using
more natural gas plants to replace coal plants; ramping up
zero-carbon energy, such as solar; and increasing energy
efficiency, said sources briefed on the proposal.
States will also be given an option to use measures such as
carbon cap-and-trade systems as a way to meet their goals.
Share prices for major U.S. coal producers like Arch Coal
, Peabody Energy and Alpha Natural Resources
were near multi-year lows ahead of the EPA rules.
A LEGACY ISSUE
Monday's rules cap months of outreach by the EPA and White
House officials to an array of interests groups.
The country's more than 1,000 power plants, which account
for nearly 40 percent of U.S. carbon emissions, will face
limits on carbon pollution for the first time.
Climate change is a legacy issue for Obama, who has
struggled to make headway on foreign and domestic policy goals
since his re-election.
But major hurdles remain. The EPA's rules are expected to
stir legal challenges on whether the agency has overstepped its
authority. In the first instance a public comment period will
follow the rules' release.
Last week the U.S. Chamber of Commerce warned the rules
could cost consumers $289 billion more for electricity through
2030 and crimp the economy by $50 billion a year.
That assessment keyed off a more stringent proposal by the
Natural Resources Defense Council, an influential environmental
group. The NRDC had proposed cutting emissions by at least 30
percent from a 2012 baseline by 2020.
Using the 2005 starting point should make the target easier
to hit, though, since emissions by 2013 were already slightly
more than 10 percent below 2005 levels, according to the Energy
A shift toward cleaner-burning natural gas away from
coal-fired plants, and the severe economic downturn of 2008-09
helped cut emissions.
Obama countered criticism of the rules in his weekly radio
address on Saturday.
"Special interests and their allies in Congress will claim
that these guidelines will kill jobs and crush the economy.
Let's face it, that's what they always say," Obama said.
Sources briefed on the proposal were told that an economic
impact study by the EPA concluded that the health and
environmental benefits of the plan outweighed costs anywhere
from $8 to $1 to $12 to $1 by 2030.
The rules, when finalized, are expected to have an impact
that extends far beyond the United States.
The failure to pass "cap and trade" legislation in Obama's
first term raised questions about how the United States would
meet commitments the president made to reduce U.S. greenhouse
gas emissions roughly 17 percent by 2020 compared to 2005
The new EPA caps are meant to answer those questions.
They could also give Washington legitimacy in international
talks next year to develop a framework for fighting climate
change. The United States is eager for emerging industrial
economies such as China and India to do more to reduce their
"I fully expect action by the United States to spur others
in taking concrete action," UN climate chief Christiana Figueres
said in a statement Sunday.
Chinese and Indian negotiators have often argued that the
United States needs to make a more significant emission
reduction because of its historical contribution to climate
EPA Administrator Gina McCarthy will introduce the power
plant guidelines Monday morning at the agency's headquarters.
Later, Obama will hold a conference call with health
professionals hosted by the American Lung Association.
(Reporting By Valerie Volcovici and Jeff Mason; Editing by Ros
Krasny and Himani Sarkar)