Full Title: EPA’s Clean Power Plan: States’ Tools for Reducing Costs and Increasing Benefits to Consumers
Author(s): Paul Hibbard, Andrea Okie, & Susan Tierney
Publisher(s): Analysis Group
Publication Date: July 1, 2014
Full Text: Download Resource
Description (excerpt):
On June 2, 2014, the United States Environmental Protection Agency (EPA) released proposed rules to reduce emissions of carbon dioxide (CO2) from existing fossil power plants. EPA’s “Clean Power Plan” would require significant reductions in CO2 emissions from the power sector, while also providing each state the flexibility to determine its preferred way to comply with the new requirements.
EPA’s analysis indicates that although there will be costs to comply with the Clean Power Plan, such costs will be much lower than the benefits to public health and to the overall economy from lower CO2 and other air emissions.
Some observers have contended that consumers will experience net costs because, in those observers’ view, overall compliance costs will outweigh economic and other benefits. EPA’s analysis indicates that customers will see slightly higher electricity rates in the near term but lower electricity bills over the long run with the Clean Power Plan in place.
Based on our own analysis and experience, we believe that the impacts on electricity rates from well-designed CO2-pollution control programs will be modest in the near term, and can be accompanied by long-term benefits in the form of lower electricity bills and positive economic value to state and regional economies.