The Clean Power Plan and a New President: What Now?

Posted by Caitlin Marquis on Jan 5, 2017 10:25:00 AM


For more than two years, AEE has been watching the Clean Power Plan (CPP) very closely; we have dissected and analyzed key aspects of the rule, followed the relevant regulatory proceedings, tracked state planning processes, and assessed modeling results. All this work has been motivated by the potential for the CPP to accelerate advanced energy deployment—an opportunity we value at roughly $20 billion annually.

On the campaign trail, President-elect Donald Trump expressed a very different view of the CPP, describing it as a threat rather than an opportunity. With Trump just over one week away from assuming his new role, there are still a number of unanswered questions about the future of the CPP. For now, we’ll steer clear of speculation and stick to what we know for certain.

First, we know that President-elect Trump has promised on the campaign trail that he would seek to reverse the CPP. In the first bullet point of his 100-day “America First Energy Plan,” released in May, Trump as a candidate promised, “We’re going to rescind all the job-destroying Obama executive actions including the Climate Action Plan and the Waters of the U.S. rule.” As a part of President Obama’s Climate Action Plan, the CPP has clearly been targeted, and Trump’s pick of climate change skeptic Myron Ebell to lead the transition team at EPA and his pick of Oklahoma AG Scott Pruitt—a vocal leader in the lawsuit against the CPP—to head the Agency indicate that he intends to make good on this promise. When announcing Pruitt’s nomination, Trump characterized EPA as having “an out-of-control anti-energy agenda,” and said that Pruitt “will reverse this trend.”

Second, we also know that there is a gap between campaign promises and policy priorities in office, meaning the order of the day is uncertainty. Since November 8, there have been some indications that the President-elect may be open to adjusting his views on certain energy-related issues. For example, Trump and his daughter Ivanka—who has reportedly listed climate change among her chief priorities—met with former vice president Al Gore to discuss climate issues in what Gore described as “a lengthy and very productive session.” Since his election, Trump has also faced pressure from more than 360 U.S. businesses to continue “investment in the low-carbon economy” to “create jobs and boost U.S. competitiveness.” And there have been some reports that Trump may be re-thinking his promise to cancel the Paris Climate Agreement. As he told the New York Times, “I’m looking at it very closely. I have an open mind to it.” These statements and actions by no means indicate that he has revised his positions; indeed, in the same New York Times interview, Trump added, “I’m not sure anybody is ever going to really know” whether climate change is real, and Reuters has reported that the Trump transition team is actively exploring options to withdraw from the Paris accord. However, his post-election interviews and meetings indicate that it is still too early to know how much time and attention his Administration will devote to unwinding the CPP.

Third, we know that undoing the CPP is not as easy as it looks. With the CPP issued as a final rule and already deeply in litigation, the CPP cannot be undone by executive fiat. The D.C. Circuit Court of Appeals could  put its decision on hold, or it may heed a request from President Trump to remand the case back to EPA. If the D.C. Circuit does issue a decision against the CPP, the Administration could opt not to appeal the decision to the Supreme Court. In that case, other intervenors (including states, municipalities, and NGOs) would still have standing to appeal. If the D.C. Circuit were to rule in favor of the CPP, these intervenors could again step in to defend the ruling, even with the government no longer in the case. In either case, the Supreme Court might decline to hear the case given the Administration’s stated intent to reconsider it, in which case the lower court’s ruling for or against the CPP would stand.

Even if the CPP does prevail through these legal “what-ifs,” President Trump would still have several options. For example, Trump could rescind the rule through the lengthy notice-and-comment process, or he could direct EPA to implement the CPP but weakly. One way or another, the Trump administration could make the CPP effectively a dead letter, at least for the course of its term in office. 

Fourth, regardless of the CPP, we know that market forces are already moving the electricity sector toward advanced energy. As we’ve written on this blog before, the industry is well on its way to achieving the emission reductions required by the CPP, due in large part to increased reliance on advanced energy. Market forces are likely to keep the electricity system more-or-less on this track even without mandatory emission reductions.  Despite campaign promises from candidate Trump to revive the coal mining industry, we expect this to be a pro-business administration that respects the market. Indeed, when testifying before Congress in May, even  Pruitt acknowledged that the shift away from coal-fired generation “didn’t happen as a result of the heavy hand of the EPA.” Instead, Pruitt cited market forces, particularly the drop in natural gas prices. No matter what President-elect Trump and EPA Administrator nominee Pruitt decide to do about the CPP, advanced energy will be on the march.

AEE and our member companies have invested a great deal of time and effort on the CPP over the past two years because we saw it as accelerating the market-driven growth of advanced energy. We plan to remain involved in any further proceedings to make the strongest case for advanced energy’s positive role in the event that the rule goes forward, now or in the future.

But the incoming Administration’s apparent intent to roll back the CPP does not mean there is no way for the advanced energy industry to continue its upward progress under President Trump. As noted in our memo to the Trump Transition Committee, our energy system is going through a transformational change – consumer preferences, dynamic new technologies, and new threats are causing the energy system as we have known it for the past century to evolve. In addition to supporting more than 2.5 million jobs in the United States, the advanced energy industry is poised to provide the technology and know-how to bring in a new era of secure, clean, affordable energy. We look forward to working with President-elect Trump and his Administration on policies that move us toward an advanced energy future.

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Topics: EPA GHG Regs



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