Since President Biden started campaigning for president in 2020, he vowed to get rid of fossil fuels. That goal has translated into over 200 ways in which the Biden Administration has made it more difficult to acquire energy from fossil fuels. One of those ways was in May 2023 when the Biden Administration proposed power plant rules that would make it more difficult for existing coal plants, existing gas plants, and new gas plants to operate. On May 9, 2024, the Biden Administration's Environmental Protection Agency (EPA) released final rules on the Federal Registrar that are to take into effect today: July 8, 2024.
The purpose of these rules is to "protect all communities from pollution and improve public health without disrupting the delivery of reliable electricity." This rule requires that existing coal plants planning to operate past 2039 and new gas plants to employ best system of emissions reduction (BSER) to control 90 percent of carbon reduction based on carbon capture and sequestration (CCS) technology. Essentially, CCS technology siphons the carbon dioxide from a plant's smokestack before reaching the atmosphere and would store the carbon underground. While this sounds fine and dandy, the proposal comes with a few major issues:
1) CCS technology is neither reliable nor able to comply with the law. In spite of the millions that the U.S. Department of Energy has spent on CCS, the technology is not fully proven. As of date, there is no power plant on the planet that is capturing 90 percent of its carbon. As this report from the Congressional Budget Office (CBO) shows, CCS can capture 10 percent on a good day. Why is the Biden Administration creating onerous regulations based on unrealistic expectations and technology that does exist according to the regulation's specifications?
2) The final rule is predicted to have negligible impact on carbon emissions. You would think that if the EPA were to enact such regulations, it would help bring down carbon emissions in a statistically significant manner. Much like with the Inflation Reduction Act and the Paris Agreement, this proposed rule will fail in that endeavor. Per EPA modeling, the proposed rule will reduce carbon by 1 percent (Chamber of Commerce, p. 6). Since power plants produce 30 percent of U.S. carbon emissions, that means that this would only reduce 0.3 percent of the United States' carbon emissions, never mind global emissions.
3) This final rule will most probably cost more than the EPA estimates. An analysis from the Chamber of Commerce found that this proposed rule has a number of flaws, one of which being cost suppression. As we see in the chart above, there is a difference between the projections from the EPA and Energy Information Administration (EIA). If the EPA is indeed rosier in their projections about coal and natural gas demand, as well as their prices, then the EPA is neglecting regulatory costs in addition to the $960 million per annum costs that the EPA is anticipating. A sensitivity analysis to better sense of the costs and benefits would solve the discrepancy between the EPA and EIA calculations.
As the libertarian Cato Institute points out in its analysis, the EPA continues to overestimate the growth of wind and solar energy, as well as the growth of technological development that makes its projections so rosy.
If that were not enough, the state of North Dakota commissioned a report to determine the effects of this EPA rule. To quote the report: "The Finalized Rule will increase costs, which, compounded with inflation, will negatively impact the affordability electric and gas services, resulting in a disproportionate effect on low-income citizens."
4) This final rule is anticipated to cause further strain to the country's electric grid. As I brought up last year, fossil fuel demand is high and is only going to get higher. To replace the increase of fossil fuel demand, renewable energy production would have to increase sixfold. Quite frankly, trying to aim for green energy without increasing nuclear power production is a fool's errand.
That is because wind and solar energy are intermittent and weather-driven forms of energy. Incentivizing renewable energy over fossil fuels will strain the electric grid and reduce grid reliability. Remember that North Dakota study from the previous point? The study determined that blackouts would be more likely if the EPA rule passes.
Postscript: Last year, Pew Research found that 50 percent of Americans disagree with Biden's climate policy and 45 percent agree. Count me among the 50 percent who disagree. I have criticized Biden's climate policy, whether it was his water heater energy efficiency standards, electric vehicle standards, the misleading Inflation Reduction Act, or his administration proposing a gas stove ban.
In his misguided attempt to lower carbon emissions, Biden's climate change policies neither help the economy nor the environment. Biden continues that pattern with his EPA power plant regulations. Not only will this power plant final rule do very little to reduce emissions, but it will make this country's electric grid more insecure by relying on intermittent energy sources. Expect higher electricity prices, brownouts, and blackouts as a result of this misguided policy.
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