Qian Luo

Targeting one of the largest CO2-emitting sectors, the US Environmental Protection Agency (EPA) finalized new regulations on power plant emissions in 2024. However, the regulations are complex, with multiple mitigation options for compliance, making it difficult to understand their consequential effects on total CO2 emissions. We evaluate these effects by enhancing a capacity expansion model via incorporating new detailed operational constraints tailored to different technologies based on the EPA’s new rules. We show that the new rules could nearly double power sector CO2 emissions reductions through 2040, bringing emissions to about 51% below the 2022 level at low average cost per ton avoided, driven primarily by coal retirements. However, the rules omit regulations on existing natural gas generators, encouraging greater use of inefficient older gas plants. We find that emissions could be cost-effectively driven to 81%–88% below 2022 levels if the EPA’s rules were applied equally to all gas generators, regardless of vintage.

The US Inflation Reduction Act (IRA) subsidizes the deployment of clean electricity, hydrogen production, and carbon capture and storage (CCS), which could enable additional actions by other federal, state, and local policy-makers to reduce emissions. Power plant rules finalized by the Environmental Protection Agency (EPA) in 2024 are one such example of complementary policies. The rules establish emissions intensity standards, not technology mandates, meaning power plant owners can choose from a range of technologies and control options provided that emissions standards are met. This flexibility makes electricity systems modeling important to understand the potential effects of these regulations. We report below a multimodel analysis of the EPA power plant rules that can provide timely information, including for other countries and states, on emissions impacts, policy design for electricity decarbonization, power sector investments and retirements, cost impacts, and load growth. We also discuss related technical, political, and legal uncertainties. 

GenX is a highly-configurable, open source electricity resource capacity expansion model that incorporates several state-of-the-art practices in electricity system planning to offer improved decision support for a changing electricity landscape. GenX is a constrained linear or mixed integer linear optimization model that determines the portfolio of electricity generation, storage, transmission, and demand-side resource investments and operational decisions to meet electricity demand in one or more future planning years at lowest cost, while subject to a variety of power system operational constraints, resource availability limits, and other imposed environmental, market design, and policy constraints. GenX features a modular and transparent code structure developed in Julia + JuMP. The model is designed to be highly flexible and configurable for use in a variety of applications from academic research and technology evaluation to public policy and regulatory analysis and resource planning.

Taking aim at one of the largest greenhouse gas emitting sectors, the US Environmental Protection Agency (EPA) finalized new regulations on power plant greenhouse gas emissions in May 2024. These rules take the form of different emissions performance standards for different classes of power plant technologies, creating a complex set of regulations that make it difficult to understand their consequential impacts on power system capacity, operations, and emissions without dedicated and sophisticated modeling. Here, we enhance a state-of-the-art power system capacity expansion model by incorporating new detailed operational constraints tailored to different technologies to represent the EPA’s rules. Our results show that adopting these new regulations could reduce US power sector emissions in 2040 to 51% below the 2022 level (vs 26% without the rules). Regulations on coal-fired power plants drive the largest share of reductions. Regulations on new gas turbines incrementally reduce emissions but lower overall efficiency of the gas fleet, increasing the average cost of carbon mitigation. Therefore, we explore several alternative emission mitigation strategies. By comparing these alternatives with regulations finalized by EPA, we highlight the importance of accelerating the retirement of inefficient fossil fuel-fired generators and applying consistent and strict emissions regulations to all gas generators, regardless of their vintage, to cost-effectively achieve deep decarbonization and avoid biasing investment decisions towards less efficient generators.