Setting the stage for a New Year battle royale between Congress and the White House over greenhouse gas emissions, the US Environmental Protection Agency Thursday laid out a timetable for the nation's largest carbon emitters – power plants and refineries – to begin curbing those pollutants.

Republicans have said all year that they plan to pull out all the stops to keep the EPA from phasing in greenhouse gas (GHG) regulations beginning in 2011, saying they would damage the energy industry, raise prices, and cost jobs.

Rep. Fred Upton (R) of Michigan, the incoming chairman of the House Energy and Commerce Committee, has said he opposes the regulations on greenhouse gases and indicated he would lead efforts to revoke EPA regulations in the next Congress. The new regulations, he says, will likely lead to the shut down of coal-fired power plants.

"To protect jobs and fortify our energy security, we should be working to bring more power online, not shutting plants down," Mr. Upton said in a statement. "We are woefully unprepared to meet our nation's growing energy demands, yet this administration's 'none of the above' energy policy will do nothing but cost jobs, make energy more expensive, and increase our dependence on foreign sources of energy."

Environmentalists lauded the EPA's move.

“By setting timetables for issuing standards to cut dangerous carbon pollution from power plants and oil refineries, EPA is doing precisely what is needed to protect our health and welfare and provide businesses certainty at a time when some would prefer to roll back the clock," David Doniger, policy director in the Natural Resources Defense Council’s Climate Center, said in a statement.

Legal background to EPA move

The EPA’s coming standards will be "based on available and affordable measures" that would enable the two industries responsible for the lion's share of US greenhouse gas emissions to begin cleaning up, Mr. Doniger noted. Boosting pollution control standards would help the utility and petroleum industries plan their future investments and create jobs.

The EPA's move was part of a legal settlement between the federal government and a number of states, local governments, and environmental groups that had sued the EPA during the Bush administration over its failure to update pollution standards under the Clean Air Act. In its announcement Thursday, EPA says it will propose standards for power plants in July 2011, for refineries in December 2011, and will issue final standards in May 2012 and November 2012, respectively.

“We are following through on our commitment to proceed in a measured and careful way to reduce GHG pollution that threatens the health and welfare of Americans, and contributes to climate change,” Administrator Lisa Jackson said. “These standards will help American companies attract private investment to the clean energy upgrades that make our companies more competitive and create good jobs here at home.”

'Costs but no benefits'

But congressional opponents and business groups representing big business and fossil fuel interests slammed the timetable as anything but reasonable, declaring it to be damaging to jobs and the economy.

“EPA’s proposals would carry tremendous costs but no benefits for the American people – all pain and no gain," Charles T. Drevna, president of the National Petrochemical & Refiners Association, said in a statement. "Regulations can’t create technology that doesn’t exist or change the laws of physics and economics, so the only way to comply with EPA’s proposals would be to inflict massive increases in energy costs and massive increases in unemployment on families across our nation."

Momentum building earlier in the year in Congress to strip the EPA of its authority to regulate greenhouse gases – or at least pass restrictions on funding that might prevent implementation of such regulations – seemed to dissipate in the 111th Congress's waning days. But analysts say the EPA's move presages renewed battle early next year.

The March 4, 2011 expiration of the continuing resolution just passed by Congress to keep the government running "makes it likely that proposals to delay EPA could emerge early in 2011 and gather momentum for two months," writes Kevin Book, a senior energy analyst with ClearView Partners, an energy market research firm in an e-letter analysis.

A 'Christmas surprise'

Though the EPA announcement had been long expected, Representative Upton called it a "Christmas surprise [that] is nothing short of a backdoor attempt to implement their failed job-killing cap-and-trade scheme." He noted also that, "We will not allow the administration to regulate what they have been unable to legislate."

Despite such opposition, there were a number of small business groups whose spokesmen said they believed the EPA regulations would be good for their businesses. Richard Eidlin, director, business engagement, American Sustainable Business Council, said the standards were needed to "send a clear market signal to investors and entrepreneurs that innovation and investment in the clean energy sector is good business.

His group was among 14 small business groups representing about 60,000 small businesses nationwide that called for the EPA to proceed with regulations to limit greenhouse gas pollution.

"As owners, employees and investors in sustainable businesses, we urge Congress to uphold the Environmental Protection Agency’s ability to regulate carbon emissions as authorized by the Clean Air Act," Mr. Eidlin said in a statement.