By Starla Yeh, Natural Resources Defense Council
EPA Administrator Andrew Wheeler has just unveiled what his agency calls the Affordable Clean Energy Rule, which is all about propping up dirty coal-fired power plants at the expense of clean energy and climate protections, and nothing about being honest with the American people.
The EPA’s Dirty Power Scam has three enormous flaws Wheeler isn’t talking about: it’s not affordable or clean; it cooks the books to justify increasing harmful air pollution; and it puts Americans’ health at serious risk.
Under the ACE Rule, Americans stand to lose big time. Americans could see:
- An added $10 billion in climate and health harms from pollution exposure;
- up to 1,630 premature deaths; and
- the loss of $11 billion in climate and health benefits from the Clean Power Plan the ACE Rule proposes to replace.
We’ve conducted an analysis that sorts through Wheeler’s efforts to obscure the harmful impacts of the ACE rule and reset the accounting fallacies to estimate the value of climate and health harms that the Trump administration didn’t want you to see. Our calculations are based on the modeling projections given in the RIA of the ACE rule, supplemented by per-ton values for climate and air pollution reductions taken from the RIA supporting the 2015 Clean Power Plan. Not surprisingly the CPP looks better and the ACE rule worse, when you straighten out the EPA’s misleading analysis.
For more background, my colleagues have reviewed the ACE rule, exposed the fiction in the EPA’s talking points, as well as surveyed the history of the Clean Power Plan and the Trump Administration’s efforts to unwind it.
The Trump administration’s analysis justifying the ACE rule is faulty and littered with inconsistencies designed to present the ACE rule in a favorable light. After all, the ACE rule suggests only minimal limits on power plant emissions premised on minor efficiency improvements at coal plants, and grants states substantial latitude to further weaken the limits that would apply.
Administrator Wheeler is up to the same tricks his predecessor Scott Pruitt employed last fall with the proposed repeal of the Clean Power Plan. The approach to accounting for the benefits of pollution reductions devalues future generations, contradicts the latest and best science on exposure to air pollution, and discounts the role U.S. climate pollution plays abroad (as well as the impact that pollution from other countries has on the U.S.).
ACE RULE ANALYSIS BUILT ON INCONSISTENCIES
Let’s start with how the Wheeler EPA analyzed the impact of the ACE Rule. The agency examined a total of six scenarios in its analysis of the ACE rule. These included two base cases representing two outlooks on business as usual (one including assumptions to represent the CPP, the other excluding the CPP altogether), one base case sensitivity assuming energy efficiency savings, and three variations to characterize notional requirements of the ACE rule. The cases were:
- Base Case, No CPP
- Base Case, CPP (no EE)
- Base Case, CPP with EE
- ACE Rule Illustrative Approach 1: 2% Heat Rate Improvement, Cost = $50/kW
- ACE Rule Illustrative Approach 2: 4.5% Heat Rate Improvement, Cost = $50/kW
- ACE Rule Illustrative Approach 3: 4.5% Heat Rate Improvement, Cost = $100/kW
In each of the ACE rule cases, EPA assumed all coal plants would adopt heat rate improvements consistent with the 2% and 4.5% levels. This scenario would require all states to set limits reflecting these levels for all coal plants. With the discretion afforded states under the ACE rule, it is unlikely that all states would impose these requirements uniformly for each plant, leading to higher levels of emissions than EPA modeled. EPA also neglected the expanding list of coal plants that have either retired or announced retirement. This is a way of biasing the available opportunity for reductions and overstating the total potential for efficiency improvements. Many of the improvements that EPA assumed would not be possible for plants that have already retired or installed more efficient systems and controls. Without defined standards in the proposed rule and without an accurate portrayal of the status of the coal fleet, even a 2% heat rate improvement is optimistic.
Another way in which EPA intentionally skews the analysis is it relies on the CPP mass-based targets applying only to existing coal plants. By contrast, the leading analyses of the CPP from EIA, M.J. Bradley & Associates and Rhodium Group have adopted the mass-based targets covering both existing plants and new plants as the intended outcome. The EPA’s selection of the existing-only targets allows coal generation that would otherwise have retired to continue operating, inflating the CPP emissions forecast and narrowing the gap between the CPP and ACE.
The ACE Rule Allows CO2 Emissions to Increase, with Unmeasured Potential for More
Next, let’s look at the impact on emissions. EPA’s analysis projects that 2030 emissions in the three variations of the ACE rule would reach 32 – 34 percent below 2005 levels. As illustrated below, emissions levels in the suite of ACE cases are bounded by the alternative base cases; ACE emissions are lower than emissions in the base case with no CPP but exceed emissions levels in the base case with CPP.
2030 emissions levels are essentially equivalent between the 2% and 4.5% HRI cases at $50/kW, at 1,798 million short tons, compared with 1,737 short tons in the base case with CPP. That amounts to a total emissions increase of 3 percent. The graph above is a detail of the emissions projections for the three modeled years to show how the ACE rule cases compare with the Clean Power Plan. You can see how minimal the differences are in the context of electric power sector CO2 emissions trends:
Carbon emissions from power plants have been on a continuous decline for the past five years. In 2017, power sector emissions sank to a 20-year low, according to the Energy Information Administration. A number of factors, including rapidly declining renewable technology costs, competitive natural gas prices, stronger environmental and public health standards, flat electricity demand due in large part to increased investments in energy efficiency, as well as anticipation of the Clean Power Plan, have contributed to the downward emissions trend. While these dynamics show no signs of abating, the Clean Power Plan must be updated and strengthened to reinforce this progress.
Updating the CPP targets with the latest available data demonstrates the significance of the declining emissions pattern. If we were to apply the latest generation projections to the 2015 CPP methodology for setting emissions limits, the final limit would be a national mass-based target in 2030 of 1,071 million short tons, equivalent to a 60 percent reduction from 2005 levels and a 44 percent reduction below current levels (see Estimated CPP Target Update in the figure above). Wheeler’s proposed ACE rule abandons the climate, health and economic upside of clean energy development in favor of polluter interests.
CLIMATE AND HEALTH HARMS OF THE ACE RULE COULD REACH $10 BILLION
We have previously reviewed the numerous practices that EPA employs to cook the books in estimating costs and benefits of the CPP when the EPA proposed to repeal it last fall. EPA commits all of the same errors again, diminishing the importance of future generations, disregarding the global impacts of U.S. climate pollution, and flouting the best available science on the health risks of exposure to harmful air pollution.
To fix the flaws, we developed estimates comparing the climate and health benefits of the CPP and the ACE rule using data taken from the EPA’s analysis of the ACE rule, along with current estimates of the global Social Cost of Carbon and the EPA’s per-ton values for benefits associated with cutting criterial pollutants sulfur dioxide (SO2) and nitrogen oxide (NOx). Our total benefits estimate is made up of climate benefits, which include a range of anticipated improvements in agricultural productivity, human health and other changes, and health benefits, which include avoided premature deaths and morbidity effects. Reduced emissions will lead to positive climate and health benefits. By contrast, increasing emissions will produce negative climate and health impacts, or harms.
Based on our calculations, the value of climate and health benefits from reducing climate and air pollution under the CPP totals $6-11 Billion ($2016) in 2030. The value of climate and health benefits could in fact be even greater because the analysis assumed a minimal representation of the potential for CPP emissions reductions.
By contrast, the ACE rule would expose Americans to climate and health harms of at least $5-10 Billion ($2016) in 2030. Similar to the estimated benefits of the CPP, these harms are likely even worse due to EPA’s overly favorable outlook on the potential for heat rate improvements across the coal fleet.
THE ACE RULE PUTS THOUSANDS OF LIVES AT RISK
Based on the EPA’s own calculations, an estimated 1,400 premature deaths would occur as a consequence of increased exposure to particulate matter (PM2.5) in 2030 if the ACE rule were in place. Particulate matter is a category of extremely small particles affect the heart and lungs and cause serious health effects when inhaled. In addition to the estimated 1,400 premature deaths resulting from PM2.5 exposure, the Dirty Power Scam will result in an additional 230 deaths tied to ozone. That is a total of 1,630 premature deaths directly attributed to this rule.
Here is what all of this means: Wheeler and the Trump administration are making the clear declaration that polluter profits matter more than 1,630 American lives. That’s appalling. That’s not in line with American values. And it’s also a 180 degree shift from the impact on public health from the Clean Power Plan, which was projected to prevent2,700 to 6,600 premature deaths and 140,000 to 150,000 asthma attacks in children.
And the death toll from the ACE rule could be even higher if air pollution increased more than the EPA forecasts. Other public health impacts from the ACE Rule in 2030 are (and it’s notable that these numbers are also buried in EPA’s documents):
- 750 heart attacks
- 200 hospital admissions for cardiovascular illness
- 210 hospital admissions for respiratory illness
- 530 emergency room visits for asthma
- 96,000 cases of exacerbated asthma
- 1,100 cases of acute bronchitis
- 26,000 cases of respiratory symptoms
- 48,000 lost work days
- 48,000 school absence days
In total, that is nearly 221,000 occurrences in one year, or about 605 daily occurrences. Not only are Trump and Wheeler putting polluter profits ahead of thousands of American lives, they are also denying our families the opportunity for better everyday health and more productivity.
EPA’s maneuvers to present the most positive outcomes of the ACE rule fall short of hiding the undeniable fact that it will do nothing to ensure the continuation of the downward trend in power sector emissions. It forgoes the opportunity for climate, health and economic benefits of clean energy development, and exposes Americans to $5-10 billion dollars in climate harms, and likely more. It also dismisses 1,630 American lives for the sake of polluter profits and downplays hundreds of thousands of health cases that would affect the wellbeing of Americans in 2030 alone.
The EPA cannot obscure the deficiencies of the ACE rule and the accrual of climate and health harms that will threaten our families even with the most favorable formulation of its analysis.
A Note: EPA Analysis of ACE Rule is Incomplete
The EPA’s analysis of the ACE rule was engineered to reflect the most optimistic scenarios. It took a biased approach to both the CPP and the ACE, minimizing the differences between the two forecasts. The EPA started to take a step in this direction with a case analyzing the impacts of including energy efficiency in the CPP base case, but fails to recognize that this more realistic scenario should have formed the basis of the rest of the analysis. The EPA should have also analyzed a CPP case adopting the targets covering both existing and new plants to acknowledge the potential for a lower- emissions forecast than in the single CPP approach represented in the analysis. NRDC will include these supplements as well as additional views on the proposal in analysis we are preparing to support our comments that we’ll submit in the public comment period on this disastrous ACE Rule.