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Fed court vacates Trump EPA ACE Rule, replacement for Clean Power Plan; various West Virginia leaders react

MORGANTOWN – President Biden has been undoing many Trump-era environmental measures with executive orders. But on Tuesday a D.C. Federal circuit court – with two Obama-appointees and one Trump appointee – undid Trump’s signature measure.

The U.S. Court of Appeals for the District of Columbia Circuit vacated the 2019 Affordable Clean Energy Rule (ACE Rule), which the Trump EPA put into place after repealing the Obama EPA Clean Power Plan (CPP) of 2015.

Here are a variety of West Virginia reactions to that ruling along with some background on the ACE Rule and the court’s decision.

Sen. Shelley Moore Capito first called attention to the ruling and expressed her concerns in a statement issued that same day.

She said, “The D.C. Circuit’s striking down of the ACE Rule today – timed by the panel’s liberal majority for the last full day of the Trump administration – is a disaster for regulatory certainty in the power sector, particularly for coal production and generation states. Specifically, this decision disrupts West Virginia’s regulatory program, which was nearing finalization and predicated on the ACE Rule.

“The timing precludes the Trump EPA from addressing the purported issues and provides a rationale for the Biden EPA immediately to try to advance a new rule,” she said. “The Biden EPA must not follow the path of the disastrous and so-called Clean Power Plan, which was an unrealistic, illegal regulation that would have strangled West Virginia’s energy economy before it was stopped by the Supreme Court. I will have pointed questions for the Biden administration and its nominees concerning its plans and their legality as it relates to regulating the power sector to reduce greenhouse gas emissions.”

State Attorney General Patrick Morrisey, who led litigation to end the CPP, plans to fight the D.C. court decision. He told The Dominion Post: “While we’re disappointed by the court’s decision, we have always believed these matters would land at the U.S. Supreme Court, where we won on this issue before in defeating the Obama-era Clean Power Plan, and would return with confidence that we will win again. This is a matter of crucial importance for West Virginia, its many coal miners and those who rely upon their success. Our state, the nation and the economy deserve to have this resolved once and for all.”

On the other hand, the West Virginia Sierra Club chapter is pleased with the ruling. Conservation chair Jim Kotcon told The Dominion Post: “The Sierra Club has long supported the need to reduce greenhouse gas emissions to reduce the adverse effects of climate change. The electric power industry is one of the major sources of that pollution. Unfortunately, the EPA under former President Trump lost sight of their most important role, to protect the American people from dangerous pollution.

The ACE rule, he said, “would not have reduced greenhouse gas emissions from power plants significantly, and would actually have allowed an increase in emissions in some cases. The ACE rule was based on the premise that only pollution controls at a plant could be required, and limited states from adopting alternative energy sources that had fewer emissions. Even EPA had acknowledged that the pollution allowed by the ACE rule would have killed thousands more Americans than the rules it replaced.

“The Courts found that EPA was wrong to limit the ACE rule in this way, and overturned the ACE rule,” Kotcon said. “No rational person would believe that allowing increased emissions is an adequate response to the climate crisis. This legal defeat for the fossil fuel polluters will be an important step toward finally acting with the urgency needed.”

Case background

CPP and ACE are both based on the EPA’s authority to regulate the emission of air pollution under the Clean Air Act.

The CPP was intended to cut overall carbon pollution from fossil-fueled plants by 30 percent below 2005 levels by 2030. For West Virginia, the target reduction was 20 percent. It proposed to reduce emissions through a combination of three “building blocks”: technological efficiency improvements to reduce coal consumption; substitution of gas-fired plants for coal plants; prioritizing zero-emission renewables over fossil fuels.

The second and third method, the D.C. Court said in its ruling, are called generation shifting, meaning shifting the power source from coal to gas and renewable.

When West Virginia and other states joined to challenge the CPP, the D.C. circuit court refused to put a stay on the rule, but the U.S. Supreme Court took the case and stayed it, saying the states would likely win their case when it went to trial.

So the Trump EPA repealed CPP and put ACE in its place. As we reported in 2019, the ACE rule established emissions guidelines for states to use when developing plans to limit carbon dioxide at their coal-fired power plants. States would have three years to submit plans, in line with other planning timelines under the Clean Air Act.

The EPA expected ACE, along with additional expected emissions reductions based on long-term industry trends, to see CO2 emissions from the electric sector fall by as much as 35% below 2005 levels in 2030.

In its ruling on the current case, brought by the American Lung Association and the American Public Health Association, the court said: “Because promulgation of the ACE Rule and its embedded repeal of the Clean Power Plan rested critically on a mistaken reading of the Clean Air Act, we vacate the ACE Rule and remand to the Agency. We also vacate the amendments to the implementing regulations that extend the compliance timeline.”

The Trump EPA’s fundamental mistake, the court said, was interpreting the Clean Air Act to say EPA can only address pollution controls put into place at the power plant site, eliminating any kind of generation shifting.

The court noted that ACE could have a “rebound effect,” meaning efficiency upgrades reduce production costs and create incentive to run more often, thereby increasing overall emissions.

The court focused on one line in the Clean Air Act, which says the EPA shall have each state “submit to the Administrator a plan which establishes standards of performance for any existing source for any air pollutant.”

The Trump EPA, the court said, wrongly chose to interpret “for any existing power source” to mean “at and to any existing power source,” thereby excluding generation shifting.

Complicating the ruling somewhat is the partial dissent by Judge Justin Walker, the Trump appointee. He agreed that ACE should be vacated but for a different reason: The EPA is applying the wrong section of federal code to the problem.

More reactions

Sen. Joe Manchin told The Dominion Post: “I have always maintained the ACE Rule is flawed for ruling out carbon capture and utilization technologies for coal plants. The ruling from the D.C. circuit requires EPA to start from square one and I am committed to working with the new EPA leadership to ensure energy producing states like West Virginia are not negatively impacted by the new proposed regulations.

“Elimination is not the solution,” he said, “Instead the United States must lead the world in developing new and innovative technologies that will ensure we can use all of our energy resources in the most clean and efficient manner possible while addressing the climate challenge.”

Rep. David McKinley, R-W.Va., did not comment directly on the ACE ruling. He did note that he is now ranking member of the Energy and Commerce Subcommittee on Environment and Climate Change, which oversees the Clean Air Act.

In that context, he said, the green community’s “goal of stopping the use of fossil fuels in the power sector by 2035 is not feasible and would decimate our economy. We will work to protect jobs and America’s economic competitiveness while developing alternative solutions that focus in American ingenuity and innovation.”

Criticizing Biden’s re-entry into the Paris Climate Accord, McKinley added, “America has already reduced its carbon emissions significantly over the past two decades. We need to play a leading role in developing the innovation on carbon capture and other technologies that can be deployed around the world to reduce emissions. However, entering into an agreement that fails to hold many of the largest emitters in the world accountable will only put our economy at a disadvantage for no gain.”

Sierra and Longview Power

Kotcon, in his comments on the ruling, also noted, “This issue is important here in Monongalia County, because the Longview power plant last month received the first-in-the-nation greenhouse gas permit under the ACE rule. That permit would have allowed Longview to emit even more greenhouse gas pollution than it does now, and further increase their emissions every year.”

The Dominion Post asked Longview CEO Steve Nelson if he wished to comment on Sierra’s statement.

He offered some context first. A permit, he said, isa permanent requirement that lasts the life of the asset. Good regulations must have reasonable bounds – reasonable accommodation for things that happen, such as normal degradation.

ACE, he said, was intended to preserve the overall quality of an asset and keep it efficient so it produces less CO2. But there’s natural limit to how much degradation you can economically offset on something as complex as a coal-fired power plant. ACE’s annual allowable increase due to degradation was actually very small.

And Longview has actually improved its efficiency year over year, so its CO2 output has decreased on a unit basis, Nelson said.

“Vacating the rule was an unfortunate result for us,” he said. “Longview has truly been a real leader in coal-fired power plant efficiency.”

All of the ACE Rule compliance features were already installed in the Longview plant, so getting a permit made sense, as they didn’t have to spend a lot of money to get to the intent of the rule.

In addition, he said, seeking the permit was voluntary and they can pull out of it themselves at any time. But they’re still looking at their options. “There’s a lot to unpack yet.” They want to see if the rest of the coal industry decides to challenge the ruling and bump it up to the Supreme Court. “There’s a little bit more to play out here, we’ll see where it goes.”

He observed, “There’s an admirable aspiration to get to a zero-carbon energy industry in the United States.” Some other countries and grids in the U.S. have pushed quickly to get there and that has led in those cases to soaring power prices and grid instability with supply shortages,blackouts and brownouts.

So it’s important to take a moment to look at the efficacy of moving to all-renewables too fast, he said. “Having a measured approach and understanding how this works in pieces is really important for the health and safety of the people of the United States and the overall health of our economy.”

Something like the ACE Rule, he said, is a way to look at what you expect of fossil fuels as you follow the path to the zero-carbon aspiration. “I’m hoping that there’s room for all voices in this conversation as we go forward with this new administration.”

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