On Tuesday President Obama outlined his plan to address the U.S. contribution to climate change. The overarching goal of the Plan is to reduce U.S. greenhouse gas emissions 17% from a 2005 baseline by 2020. The graphic below shows the major sources of carbon pollution in the U.S.
The electricity and transportation sectors account for over 60% of U.S. carbon emissions and will be the focus of much of the plan to reduce U.S. emissions. In 2007 the U.S. Supreme Court ruled that the U.S. Environmental Protection Agency (EPA) had the authority to regulate carbon emissions under the Clean Air Act (CAA). Just a few months ago President Obama stopped the EPA from issuing regulations for new power plants. The release of the Climate Change Action plan signals that the President will have the EPA push forward with regulation for new and existing power plants, but on a longer timeline. It is expected that the new rules will be proposed in a year, finalized a year after that. When they take affect will depend on the level of litigation that takes place around the new rules. So, new regulations and implementation are 3-5 years away. The likely short-term outcome of the plan will be support for the trend of planned retirements of coal-fired power plants that was being driven by low natural gas prices and environmental regulation on mercury emissions.
The President’s Action Plan seeks to continue the momentum around the growth in renewable energy sources. The 2014 budget includes a 30% increase for clean energy technology, with the goal of doubling solar and wind generation by 2020. The Interior Department has also been directed to permit enough renewable electricity by 2020 to power 6 million homes.
In the transportation sector, the Plan calls for improving heavy duty vehicle emission standards after the current standards expire in 2018. The Plan also supports the existing Renewable Fuel Standard, and renewed research efforts to bring about the next generation of biofuels.
The full Action Plan can be found on the White House website here.