The Clean Power Plan proposed
by the Environmental Protection Agency (EPA), and strongly backed by
the Obama administration, sets a carbon intensity limit on electricity
production by existing power plants. The limit is set per US State,
taking into account the actual energy mix of each State. Each State has
to develop a Plan with measures and a timeline showing how this limit
will be reached in 2030.
The reduction plans can include 4 different
types of ‘ building blocks’: optimization of existing power plants,
shifting power production to less carbon-intensive power production
(e.g. from coal to gas) or to low- or zero-carbon generation (e.g.
renewables, coal with CCS, nuclear) and reducing emissions by
demand-side energy efficiency measures, reducing the total amount of
generation required. Measures can also include emissions trading, such
as the system that is already operational in California.
In response to the plan, many commentators have pointed out that
its effects will be rather limited. Indeed, the EPA itself stresses
that the plan will not have disruptive effects, but mainly reinforces
existing trends. However, what most critics have missed is that the way
the plan is set up, is fundamentally different from how for example the
EU approaches climate policy in the energy sector. The US plan seems
well thought through. It avoids policy mistakes made in Europe and could
form an example for EU policy making, introducing the ‘missing link’
between CO2 emission trading, energy efficiency and renewable energy
policies in Europe.
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