State regulators are still including EPA carbon rules in the permits they issue for new gas-fired power plants, despite the federal agency’s plans to repeal the rules.
But how they’re doing that varies from state to state.
States usually take the lead in issuing air quality standards for power plants within their borders. So even states that sued to stop the Biden greenhouse gas rules from taking effect are responsible for ensuring that their fossil fuels generators have a plan to meet those standards when they’re granted an operating permit — unless and until EPA finalizes their repeal.
“The law that’s on the books is what’s on the books right now, so that’s what folks have to comply with,” noted Miles Keogh, executive director of the National Association of Clean Air Agencies, which represents those state regulators.
And they are.
Georgia joined 24 other GOP-led states in 2024 in challenging the Biden-era rule that would require coal- and some new gas-fired power plants to retrofit with carbon capture and storage by 2032. Those fossil fuels plants that weren’t prepared to start capturing 90 percent of their carbon by that year would have to commit to a retirement schedule, in the case of existing coal. New gas would be required to run below 40 percent capacity.
The Trump EPA proposed repealing the standards last year, and a final rule is currently under White House review.
Still, when the Georgia Department of Natural Resources issued a so-called Title V permit for the Plant Bowen combined-cycle natural gas project in January, it required Georgia Power to retain records of fuel usage and take other steps to comply with the Biden rules and a 2015 greenhouse gas standard “as applicable.”
It also required the project to keep greenhouse gas emissions to a 12-month average of 905 pounds of carbon dioxide equivalent — in line with the first phase of the 2024 rules before the CCS requirement kicks in.
Another litigant — the state of Ohio — did the same.
The Ohio Environmental Protection Agency in its draft permit for the Chestnut Run Energy project in January acknowledged that the proposed 1,300-megawatt combined-cycle natural gas power plant would have to comply with the 2024 rule. It would use “high efficiency combustion technology” to keep emissions to 800 lb CO2e per megawatts per hour when running at full load — again, a level in line with the rule’s preliminary phase before the 2032 CCS requirements take effect in 2032.
The Homer City Generation Station — under development at a decommissioned coal-fired power plant in Pennsylvania — includes both combined-cycle and simple-cycle units. A revised application for the project that was submitted to the Pennsylvania Department of Environmental Protection last July, after EPA’s repeal was proposed, states that the combined-cycle units would “have to meet an emission limitation of 800 lbs CO2/MWh based on gross energy output or 820 lbs CO2/MWh, based on net energy output.”
Pennsylvania isn’t among the states that sued EPA over the 2024 rules.
But North Dakota did join the lawsuit. Its method for implementing the standard also stands out from other permits and drafts POLITICO reviewed for this story.
In a permit last December allowing Basin Electric Power Cooperative to construct its new Bison Generation Station combined-cycle natural gas plant, the North Dakota Department of Environmental Quality acknowledged it would need to meet EPA’s greenhouse gas rule. But the permit included no emissions limit or compliance strategy for that rule, and instead pointed in a footnote to EPA’s June proposal to repeal it.
“If the rule is repealed, subjectivity to this standard, as referenced in the permit, will be eliminated,” it stated.
David Stroh, an official with the department’s Division of Air Quality who worked on the permit, said in an email that as things currently stand, the facility would need to comply with the greenhouse gas rules when it starts up in 2027 or 2028.
“However, due to impending regulatory uncertainty and the variety of available compliance pathways — such as carbon capture or operational restrictions — the North Dakota Department of Environmental Quality did not mandate a specific methodology,” he said.
In a follow-up call, Stroh said that the department ordinarily would have included a numerical limit on emissions as part of its permit. But it didn’t do so for the greenhouse gas rules because EPA has signaled it plans to roll those back. Including them in the permit to construct might have required a revision, he said.
“We felt it was just most simple at this stage in the game to reference ‘they must comply,’” Stroh said. “But we thought we’d be a little bit vague at this stage about how they’re going to do that, because there are a lot of moving parts.”
If the 2024 carbon rules are still on the books when the Bison plant begins operations in a year or two, he said, the state will issue an operating permit within a year that would include a numerical limit on greenhouse gases in line with the EPA’s requirements.
“They’ll have to comply with it,” Stroh said, adding that he’d already discussed compliance options with Basin Electric Power Cooperative, including carbon capture and storage and reducing capacity.
If EPA repeals the 2024 standards in the coming months, that move is likely to be litigated, perhaps all the way to the Supreme Court.
But even if the Trump regulatory rollback is overturned, that won’t mean challenges to the Biden rule are at an end. The uncertainty might carry some risk for utilities and their customers as they seek to bring new gas plants online.
But Keogh said a state’s perception of that risk “depends strongly on what your theory of the future is.”
“I don’t think North Dakota has made much of a secret of its theory of the future,” he said. “They and a number of other states have weighed in pretty heavily, saying they don’t think that EPA had the authority to issue these things.”
Advocates for the utility industry say it’s unlikely that gas plants will have to retrofit with CCS to operate at full capacity after 2031, as the Biden rule demanded.
“Everyone is aware that the Trump efforts to revoke the endangerment finding for power plants may not hold up in court and that there’s risk that a future EPA may try to regulate CO2 emissions from fossil fuel power plants aggressively,” said Jeff Holmstead, who represents industry clients at Bracewell. “But that’s a long way into the future, and it’s not at all clear that CCS will be required.”
