EPA finalises power station carbon rules, upping climate bill stakes

In what looks like an orchestrated move, the US Environmental Protection Agency (EPA) yesterday followed the unveiling of the draft US climate change bill by finalising new rules that will require large coal-fired power stations and industrial plants to obtain emission permits.

The new rules, which mark the latest phase of the EPA's efforts to regulate carbon emissions through the existing Clean Air Act, will require all power plants, factories and other facilities that emit more than 75,000 tons of greenhouse gases a year (and already need Clean Air Permits for other pollutants) to apply for an additional permit for greenhouse gases from the start of next year.

The conditions of the permit will legally require companies to demonstrate that they have used the "best available control technologies" to reduce greenhouse gas emission whenever facilities are constructed or significantly modified. It is hoped that over time they will effectively force energy firms to install clean coal technology and ensure that other industrial companies significantly improve their energy efficiency.

From July next year the permitting requirements will be extended to cover any facility with greenhouse gas emissions of 100,000 tons a year, ensuring that the new rules cover large waste landfill sites and those factories not already required to obtain permits under the Clean Air Act.

The agency said that sites that emit less than 75,000 tons a year will not be covered by the rules until 2016 at the earliest.

EPA Administrator Lisa P. Jackson said that the move would help drive investment in clean and energy efficient technologies, while the phased in approach would give businesses time to comply with the new requirements.

"After extensive study, debate and hundreds of thousands of public comments, EPA has set common-sense thresholds for greenhouse gases that will spark clean technology innovation and protect small businesses and farms," she said. "It's long past time we unleashed our American ingenuity and started building the efficient, prosperous clean energy economy of the future."

The EPA's legal right to regulate greenhouse gas emissions under the Clean Air Act is currently the subject of numerous legal challenges, but is also regarded as essential to the Obama administration's efforts to pass the comprehensive climate change bill that was unveiled by Senators John Kerry and Joe Lieberman on Wednesday.

The administration has said it regards the EPA's use of the Clean Air Act as its "plan B" for tackling carbon emissions and has hinted that it will further tighten the agency's rules if the climate bill is not adopted.

It is hoped the gambit could help to secure the handful of Republican votes required to pass the bill, as many Senators and businesses see the new legislation as a favourable alternative to using the Clean Air Act to curb emissions.

Senator Kerry, who helped shape the draft bill, yesterday issued a statement spelling out his view that Senators face a straight choice between regulating carbon emissions through new legislation or the EPA. But Kerry said polluters would get a better deal under the legislation. "If Congress won't legislate a solution, the EPA will regulate one, and it will come without the help to America's business and consumers contained in the bill", he said.