The Biden administration is expected to introduce new regulations soon, requiring natural gas-fired power plants to adopt carbon capture technology. The move is part of President Joe Biden's plan to decarbonize the power sector by 2035. The Environmental Protection Agency (EPA) could unveil the standards for new and existing power plants, which contribute to a quarter of US greenhouse gas emissions, as early as this week.
New Standards to Replace Former Trump and Obama Energy Rules
The upcoming standards will replace former President Donald Trump's American Clean Energy rule and former President Obama's Clean Power Plan, which courts invalidated. The new rules, which have been in development for over a year, are expected to be based on carbon capture and storage (CCS) technology, according to clean air law experts and industry representatives involved in discussions with the EPA.
Utilities to Choose Between CCS Tech and Renewable Energy
Utility companies must decide whether to build new baseload gas plants with CCS technology or opt for zero-emission renewable energy. States will be responsible for developing plans to bring their plants into compliance. The new standards could level the playing field between new gas plants and renewable energy sources such as solar and wind power.
Legal Developments Supporting Carbon Capture and Hydrogen
Two major legal developments will help ensure the new rules are legally defensible. A Supreme Court decision last July allowed the EPA to issue plant-specific rules, while the Inflation Reduction Act created tax credits that make carbon capture and hydrogen more affordable. The law also offers over $100 billion in clean electricity tax incentives, including a 70% increase in credits for each ton of carbon captured and sequestered.
EPA May Set Varying Standards for Different Types of Plants
The EPA could establish different standards for plants depending on their operational patterns. Stricter measures might be applied to plants that constantly run, while more lenient ones could be implemented for "peaker" plants that run during high power demand periods.
Fossil Fuels and Renewable Energy in the US Power Mix
In 2022, fossil fuels accounted for over 60% of US electricity generation, with 60% of that coming from gas and 40% from coal. Renewable sources comprised 21.5% of the power mix, with the remaining portion coming from nuclear energy. The US Energy Information Administration projected that solar power would account for 54% of new generation capacity in 2023, with natural gas contributing 14%.
Industry Concerns Over Carbon Capture and Storage Technology
Some industry representatives have expressed concerns about basing power plant standards on carbon capture and storage technology. The National Mining Association cited the failure of the Texas-based Petra Nova project as an example, claiming that CCS is not an "adequately tested technology." Utility Southern Company, which is phasing out its coal generation fleet, believes the commercial deployment of carbon capture technology is still "many years away" despite the cost-reduction potential of the Inflation Reduction Act.