The draft may be significantly weaker than last year's due potential industry legal challenges. | REUTERS EPA sends climate rule to W.H.

EPA just hit the accelerator in its push to fulfill President Barack Obama’s climate promises.

The agency has sent the White House a new draft of its proposed greenhouse gas rule for future power plants, POLITICO learned Monday — less than a week after Obama announced he was ordering the Environmental Protection Agency to undertake a huge effort to throttle carbon pollution from the power industry.


The substance of the draft is confidential and may not become public for months. And it may be significantly weaker than an April 2012 draft that had seemed vulnerable to industry legal challenges.

But EPA’s swift action served notice that the administration has quietly laid the groundwork to carry out the president’s pledges and that the environmental agency was most likely ready with its revisions by the time Obama spoke on Tuesday.

It may also serve as an omen for EPA to make quick progress on an even more sweeping rule affecting the nation’s existing power plants, which produce about 40 percent of the nation’s greenhouse gas emissions. A draft of that rule is due next June.

Both rules are expected to heavily disadvantage coal as an electricity source while favoring natural gas and nuclear, wind and solar power, although the administration has committed to offer as much as $8 billion to help coal plants meet the standards by capturing their carbon emissions. Coal is the cheapest and most abundant fossil fuel in the U.S. but also the dirtiest.

As is typical at this stage of rule development, EPA did not release the substance of the draft it sent to the White House. The Office of Management and Budget will analyze the draft and collect input from other agencies before sending it back to EPA.

Obama set a Sept. 20 deadline for the proposed future-plant rule’s release to the public.

Some observers had predicted that EPA wouldn’t send the proposal to OMB until August. But several environmental and industry experts said Monday that the agency’s quick action didn’t surprise them in light of the deadline Obama had imposed.

“It’s already July, and I think it would be embarrassing for the administration to miss its very first deadline,” said Scott Segal, director of the Electric Reliability Coordinating Council and an attorney with Bracewell & Giuliani.

“The Sept. 20 publication date required quick submission to OMB to provide something close to the standard 90-day review period,” David Hawkins, director of climate programs at the Natural Resources Defense Council, said by email. “I assume the Sept. 20 date was included in the memo to drive the process.”

EPA initially released a stringent draft of the future-plant rule in April 2012 but missed its deadline this April to release a final version, amid rumors that the agency was considering a drastic rewrite in response to legal and technical concerns. The delay sparked threats of legal action from states, cities and environmental groups that favor the tough rules.

Obama’s climate announcement Tuesday revealed agency plans to issue a new proposal in “light of the information conveyed in more than 2 million comments on that proposal and ongoing developments in the industry,” according to the president’s memorandum to EPA.

The 2012 draft called for limiting the greenhouse gas emissions from any new power plant to a level about equivalent to a state-of-the-art, combined-cycle natural gas plant. That would require any new coal-fired power plant to use costly, rare carbon capture technology — with the other options limited to either natural gas or zero-emissions technologies like wind, solar or nuclear.

The draft sparked outcry from members of Congress who charged it would be the death of coal.

It’s unclear what changes EPA has made to the proposal, and agency officials have held their cards close in recent weeks. Following the OMB rule, EPA could release an entirely new rule for public comment or simply limit discussion to select issues.

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But several concerns have risen to the top of the pile among the 2 million comments.

The most prevalent and public dispute about the original draft has centered on EPA’s initial decision to set a uniform pollution limit for all power plants, rather than setting different standards for various fuel types as the agency normally does in this kind of regulation. The intent of the draft’s strategy was to provide incentives for owners of coal plants to use carbon capture technology or to use lower-carbon power sources. But coal supporters say it’s unfair to hold coal plants to a standard they can’t meet with typical technology.

Others have raised concerns about the need for fuel diversity and the availability and costs of coal versus the alternatives in some regions.

Greens have long urged EPA to lump all power plants into one big category, but the approach is generally untested in the courts.

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Some utilities have argued that even some state-of-the-art gas plants couldn’t meet the original EPA draft’s standard, 1,000 pounds of carbon dioxide emitted per megawatt hour.

Given all that, insiders are betting that EPA could have made two big changes in the new draft: raising the limit and offering separate standards for various fuel sources.

If EPA has decided to divide the rule by types of fuel, other questions remain: Will it also set different limits for different types of coal-fired plants? How stringent will the limits be?

One utility source closely following the rule making says Obama’s climate action plan may give the agency some direction: The president has ordered that the U.S. not provide funding for any overseas coal-fired power plants that don’t use carbon capture technology, so it may be tough to allow a less strict standard at home.