Clean-energy debate pitted ambition against legal worries

By Joby Warrick August 2 at 7:42 PM

Four weeks before the official rollout, the news for President Obama’s signature regulation on climate change suddenly went from bad to abysmal.

Already, the Senate’s top Republican was urging a nationwide boycott of the carbon-cutting proposal known as the Clean Power Plan. Fourteen states had joined in a lawsuit seeking to block the rule even before it became final. Then came a blow from the Supreme Court: a surprise June 29 decision blocking the White House’s previous attempt at curbing pollution from coal-burning power plants.

By July 7, the head of the Environmental Protection Agency was testily deflecting questions over whether the Clean Power Plan — a pillar of the White House’s climate-change strategy — could survive the gantlet of legal and political challenges it faced.

“We certainly know how to defend against lawsuits, for crying out loud,” EPA Administrator Gina McCarthy told reporters at a Washington news conference.

White House officials pressed ahead with the proposal, ultimately deciding on an altered version that will be formally adopted at a ceremony Monday. But while the revised rule expresses lofty aims, the details reflect real, practical concerns about the battles still to come: an expected onslaught of litigation and legislation designed to derail the rule.

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The final shape of the Clean Power Plan was hashed out over months of often contentious meetings as administration officials debated how to balance two competing objectives. On one side were advocates who pushed for the deepest possible cuts in U.S. greenhouse-gas pollution to help build momentum for international climate talks this December in Paris. On the other were experienced regulators and lawyers who saw trouble ahead as the proposed rule picked up growing numbers of opponents in Congress and in the utilities industry.

As expected, some of the opponents went on the attack Sunday, hours after elements of the revised regulation were made public. Critics called the new version badly flawed and liable to be tossed out by judges.

“The EPA still has created an untested foundation for the rule,” said Scott Segal, director of the Electric Reliability Coordinating Council, an association of power companies that will be subject to the regulation. “It has tread upon established constitutional principles and undermined the sense of federalism that is essential to the Clean Air Act.”

But other observers said the administration appeared to have gotten exactly what it wanted. Supporters said the revisions to the regulation undercut the most salient legal and political objections raised by critics, including the claim that the plan will unfairly burden poor people or will lead to disruptions in the power supply. At the same time, the plan appears capable of achieving its goals of encouraging greater adoption of renewable energy as well as dramatic reductions in heat-trapping carbon pollution over the next 15 years, said S. William Becker, executive director of the National Association of Clean Air Agencies, an independent group that represents state regulators.

“EPA has struck the right balance,” Becker said. “The agency has strengthened its legal defense of the program without sacrificing environmental integrity.”

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The Obama administration is toughening rules that force states to cut pollution from coal-burning power plants. (Erin Patrick O'Connor/The Washington Post)

First proposed a year ago, the Clean Power Plan is the administration’s boldest attempt to date to reduce emissions blamed for climate change. The rule takes aim at coal-fired power plants and requires every state to reduce pollution from electricity generation, the biggest single source of greenhouse-gas emissions.

The revised plan sets a goal of cutting carbon pollution from power plants by 32 percent by the year 2030, compared with 2005 levels — a 9 percent jump from the previous target of 30 percent — while rewarding states and utility companies that move quickly to expand their investment in solar and wind power.

The original proposal introduced in June 2014 drew skepticism from many states and furious opposition from congressional Republicans, particularly lawmakers from coal-producing states. In March, Senate Majority Leader Mitch McConnell (R-Ky.) wrote a letter to all 50 governors urging them to ignore the EPA rule, calling it “extremely burdensome and costly” and on “shaky legal grounds.” Six states vowed to boycott the rule, and Democratic governors joined Republicans in lawsuits to block its implementation.

Against a backdrop of rising criticism, EPA and White House officials convened a series of private meetings to determine whether and how to change the proposal. At the EPA, McCarthy, a former Massachusetts environmental official and veteran of numerous fights over pollution laws, presided over daily meetings in the agency’s wood-paneled Alm conference room to hash out possible revisions with the agency’s air-quality officials and lawyers. Later the sessions moved to the Old Executive Office Building, where White House and State Department officials grappled over the rule’s final form.

“It is an understatement to say that the administrator and the agency were under tremendous pressure to get the rule done and, more importantly, to get it right,” said an administration official who attended many of the sessions.

While all the participants expressed support for a robust rule, McCarthy would face the additional burden of having to defend the proposal in front of skeptical congressional panels and, ultimately, in court, said the official, who spoke on the condition of anonymity to describe internal deliberations.

“She recognized the amount of scrutiny this rule will be under, both politically and legally,” the official said. “She has been leading the charge to ensure that it is airtight, that all the legal t’s are crossed and i’s dotted, and that it adheres strictly to the Clean Air Act.”

Among those pushing for the strongest possible rule was Secretary of State John F. Kerry, who will represent the United States in talks later this year on a proposed international climate treaty. Kerry “pushed very hard internally” for a tough regulation, according to a diplomatic official familiar with the private discussions, arguing that the United States needed to set a strong example if it expected other countries to join in a global pact to reduce greenhouse-gas pollution blamed for accelerating Earth’s warming.

“He wanted to make the rule as strong as possible to keep the United States on track for meeting its commitments,” said the official, who also spoke about the deliberations on the condition of anonymity.

The discussions were nearing the homestretch when the Supreme Court issued its June 29 ruling blocking the EPA’s 2011 regulation curbing emissions of mercury and other toxins from coal-fired power plants. The court’s 5-to-4 decision did not overturn the EPA’s regulation but said the agency erred in failing to properly consider the cost imposed on businesses and ratepayers.

The court’s decision cheered opponents of the Clean Power Plan while casting a pall over the now thrice-weekly gatherings of White House and EPA officials to draft the final version of the rule.

“While the court decision was hardly a resounding defeat, it made clear what was at stake,” said the administration official who participated in the internal discussions.

The court decision was an impetus for a number of changes that softened the rule’s impact on states. In the end, White House officials agreed to extended compliance timelines, giving states an additional two years and increased flexibility to help them meet pollution-cutting targets.

A “safety valve” feature was added so states could appeal for additional extensions if disruptions to the power supply appeared likely. Whole sections of the proposal were cut because of concerns that they made the rule vulnerable to court challenges.

But while the regulation was softened in some ways, it was strengthened in others. Pollution-cutting goals were toughened, and a new Clean Energy Incentive Program was added to reward states for acting quickly to invest in renewable energy. The end result was a rule that was both technically strong and legally solid, said Paul Bledsoe, who was a climate-change aide in the Bill Clinton White House.

“The final regulations clearly show the administration walking a fine line,” Bledsoe said. “For the moment they seem to have struck a remarkable balance, providing a secure position from which to negotiate forcefully with other nations in Paris later this year.”

Joby Warrick joined the Post’s national staff in 1996. He has covered national security, intelligence and the Middle East, and currently writes about the environment.