EPA Relaxes Climate Regulation Proposal, Exempting Current Gas Plants (NYSEARCA:XLU)

4 months ago 134977

The Biden administration announced this week that existing natural gas power plants will not be included in its proposed carbon regulations for the time being. This decision represents a significant weakening of a key regulation aimed at reducing greenhouse gas emissions.

The Environmental Protection Agency (EPA) confirmed that it still intends to finalize standards by April to decrease carbon emissions from existing coal and new gas-fired power plants. Instead, the EPA plans to establish a broader rule that will target all gas plants currently operating in the United States. Last May, the EPA introduced a set of standards that were projected to reduce carbon emissions from coal and new gas plants by 617 million metric tons between 2028 and 2042, equivalent to the annual emissions of 137 million passenger vehicles.

The inclusion of standards for existing gas plants in the proposed rule was a last-minute addition last year, and utility companies raised concerns about potential impacts on grid reliability. Feedback received by the EPA questioned the legal basis for mandating the use of technologies like carbon capture and sequestration, as they are not widely adopted. Some environmental groups expressed disappointment over the EPA's decision to delay regulation of existing gas plants, viewing it as a risky move due to the likelihood that new mandates will not be in place before the presidential election in November.