New Source Performance Standards for Global Greenhouse Gas Emissions From the Power and Refining Sectors: Wrong Mechanism at the Wrong Time
For those interested in the intersection of global greenhouse gas (GHG) regulation and responsible energy policy, December 23, 2010, was a day worth remembering. Over at the U.S. Environmental Protection Agency (EPA), regulators were announcing a schedule for rulemaking for new source performance standards (NSPS)1 for GHG emissions from refineries and power plants. Meanwhile, the Wall Street Journal2 ran a lead editorial reflecting upon an apparent division in the ranks among power companies. Reasoned the Journal, those without appreciable amounts of coal-fired generation were favorably disposed to potential EPA regulation of GHGs because it simply allowed them to charge more by increasing the clearing price for energy. These two developments in many ways frame the debate over NSPS. EPA proposes regulation, and self-interested sources agree, thereby reinforcing economic claims made by the Agency in defense of its decision.