This is the third of a three-part series on energy, environment and US law in light of the launch of President Obama’s National Climate Change Action Plan. Here in Part 3, we conclude our discussion regarding US climate change legislation with Robert B. McKinstry, Jr., Practice Leader for Ballard Spahr’s Climate Change and Sustainability Initiative, and move on to discuss the ramifications of the president’s National Climate Change Action Plan with Darin Lowder, Associate in Ballard, Spahr’s Energy and Project Finance practice.
Limiting carbon, greenhouse gas emissions from existing, as well as new, power plants
Back in April 2012, the Obama administration EPA issued a proposed new rulemaking for federal standards to reduce carbon and greenhouse gas emissions from new power plants, an action that the EPA had refrained from taking during President GW Bush’s two terms in office. Though required to issue a final rule within one year, the EPA, inundated with with more than 2 million comments, has yet to do so.
Legal actions from opponents also factored into the delay, McKinstry recounted.
“EPA got a lot of adverse comments from coal industry and coal state interests. They didn’t take action on existing source standards, and sat on the new source standards published in the Federal Register. When they missed the deadline, environmental groups filed suit to force their hand.”
The President took executive action on June 25, seeking to put the EPA’s initiative back on track with the launch of his National Climate Change Action Plan. Part and parcel of the national strategic plan, a Presidential Memorandum was issued directing the EPA “to work expeditiously” to finalize carbon and greenhouse gas emissions limits not only for new, but for reconstructed and existing power plants, as well.
Setting a definitive timeline for issuing new rules governing carbon and greenhouse gas emissions, in the memorandum the President directs the EPA “to issue a new proposal by no later than September 20, 2013…and further direct you to issue a final rule in a timely fashion after considering all public comments, as appropriate.”
Furthermore, McKinstry noted, the President’s memorandum directs the EPA to:
- issue proposed carbon pollution standards, regulations, or guidelines, as appropriate for modified, reconstructed, and existing power plants by no later than June 1, 2014;
- issue final standards, regulations, or guidelines for modified, reconstructed, and existing power plants by no later than June 1, 2015; and
- require states to submit implementation plans required under section 111(d) of the Clean Air Act to the EPA no later than June 30, 2016.
The establishment of target dates for new EPA limits on carbon and greehouse gas emissions – which are also to include new limits on hydrofluorocarbons (HFCs) – will result in another surge of legal activity on the part of coal and fossil fuel power plant owners and operators, according to Darin Lowder, Associate in Ballard Spahr’s Energy and Project Finance practice.
Spurring action across government and industry
The President’s National Climate Change Action Plan will spur and renew momentum not only at EPA, but across federal government departments and agencies, and not only when it comes to reducing carbon and greenhouse gas emissions, but in terms of fostering further gains in renewable and clean energy, energy efficiency and clean technology, Lowder told GWIR.
“I’d expect HUD (the Department for Housing & Urban Development) to quickly come up with a policy to incentivize all this. The Department of Defense (DoD) has 3-gigawatts (GW) of clean energy installed on military installations.”
The military’s situation is a particularly interesting one, he continued, “because of additional value off-grid redundancy renewables provide. They’ve had a very robust discussion in the military about benefits of diversifying the energy supply chain, not only on bases and other facilities, but in the field as well.
“Grid power plus renewables makes life a whole lot easier and safer, even in the case of catastrophic attacks. The benefits are worth the additional cost, and though they don’t like to, they are authroized to pay the additional costs. Plus, they have some locations that are great for renewables.”
Fundamental shifts in mindset
The President’s climate change mitigation and adaptation initiatives have spurred a shift in the military’s mindset and attitude when it comes to energy and the environment, he continued. In traditional fashion, branches of the US Armed Forces, and units within them, are now competing to see who can be the most energy efficient, who can best minimize resource use and ecological impacts, and who can deploy the most in the way of renewable energy resources, Lowder continued.
“All of a sudden, you see competitions over who’s the most energy efficient. It’s a very fundamental shift. The way they had it done in past, you had facilities that had just one meter for an entire base. That’s changing radically now, and for a lot of reasons. One of the mechanisms pushing this is the things we’re discussing. Things like energy performance contracts push that change. Measurement is the first step.”
That fundamental change in values and attitudes towards energy and the environment needs to be replicated across the energy, industrial, financial, government and public sectors if the President’s vision of building a greener, sustainable low-carbon society and economy is to be realized. Stakeholders across the economy and society need to come together in a genuine spirit of collaboration, overcome their differences, and join forces in identifying and aggressively implementing practical solutions, Lowder said.
Such movement is already well under way, he added.
“There are huge opportunities in all this, and there are numerous examples of people trying to understand each other’s view and aggressively pursue common goals…You’re seeing a blending of diverse views and interests taking place around these opportunities. Housing authorities, for instance, have to satisfy banks and investors’ requirements. It’s not completely foreign to them, but it’s set in a new and different context.
“It’s similar with the military regarding contracting with private housing developers to install solar and renewable energy systems, which entails bringing project developers and banks into the picture, familiarizing them with federal procurement and compliance requirements in the effort to raise their overall comfort level to the point they’re willing and able to move forward proactively.”
Despite all the gains of the past decade and more, the entire movement toward building a sustainable, low-carbon society based on greater energy efficiency, less in the way of materials and natural resource use and waste, and a diversified, more decentralized mix of clean and renewable energy resources is still in its infancy, Lowder pointed out.
“Housing authorities, especially in New England have been using co-generation – capturing and using heat as well as using electricity. You can do that with natural gas. Some facilities are replacing old heating systems, fuel oil boilers that are literally 50-60 years old with new equipment and combined heat and power (CHP) systems. There are tax credits available for that. They’re less than that for solar, but the same potential exists for private developers to enter the field.
“Energy management, demand management, even fostering changes in behavioral patterns — like showing people how much power they’re using – there’s growth potential in all these areas. The same is true in the military. It seems basic in retrospect, but a fundamental shift in awareness and information availability is helping spur all this forward.”