US EPA Power Plant Pollution Rules to Generate Billions in Economic Benefits.
by Ruben Aronin, Assistant Director, California Business Alliance
Last month, the U.S. EPA followed California’s lead and released new rules to reduce the greenhouse gas emissions from power plants that significantly contribute to climate change. As with many successful regulatory initiatives, the EPA took a page from the business play book and set the ultimate targets without an overly prescriptive plan of how to achieve them.
By allowing states significant flexibility to implement innovative and varied approaches to reach the goal of reducing carbon pollution from power plants to meet a 30 percent reduction by 2030, the EPA is providing a roadmap to unleash the entrepreneurship and creativity that have always been the best attributes of American companies.
Recently, I had the opportunity to hear Dan Utech, Director for Energy and Climate Change at the White House Domestic Policy Council, share some of the particulars of the new power plant rule and the myriad economic benefits that will result from its implementation. Utech briefed business leaders from across the country about the impacts of the plan and called it a “big deal” that will help make businesses and our economy become more energy-efficient and more productive.
Since energy efficiency and renewable energy generation are key pieces of the plan, we can expect to see a significant increase in jobs. California has already benefitted from job growth from the clean energy industry for more than a decade, however other states are beginning to reap significant job benefits as well. Energy efficient investments also create a virtuous cycle of local economic benefits. Local jobs are created to conduct energy efficiency improvements in homes or businesses which results in monthly utility bill savings that then get invested right back into the local economy.
The power plant reduction rule is especially helpful for businesses for the following reasons:
- It establishes a national policy. Only 29 states currently have a renewable portfolio standard (for generating a percentage of power from sources such as solar and wind); this EPA rule will be a national standard, thus creating certainty that investors and businesses can rely on.
- The plan isn’t prescriptive – it emphasizes state empowerment and focuses on outcomes.
- States that have been working on clean energy, energy efficiency and emissions reductions (like California) are ahead of the game as they already offer a predictable business investment environment around their commitment to renewable energy and emissions reductions strategies.
- The plan will likely incentivize states to invest in additional renewable energy production and energy storage that will be key drivers of future growth.
- The existing and emerging business opportunities for clean energy companies also are likely to significantly increase as a result of this policy as it provides certainty by favoring investments in renewables and energy efficiency that help reduce carbon pollution.
Utech concluded the briefing by reminding the business community that the new EPA rule represents a massive economic opportunity, with health and economic benefits for businesses, employees and the general public estimated to be $55 – $93 billion in 2030 compared to estimated costs of just $7.3 – $8.8 billion. Fortunately for our state’s businesses and the public at large, the EPA rule only improves upon California’s strong foundation created by its forward-thinking clean energy policies already in place.