Dive Brief:

The Environmental Protection Agency plans to solicit input from power sector stakeholders on what should replace President Obama's Clean Power Plan, Reuters reports.

A document viewed by the news agency reportedly said the agency will issue an Advanced Notice of Proposed Rulemaking to ask for input as it considers " developing a rule similarly intended to reduce CO2 emissions from existing fossil fuel electric utility generating units.”

The EPA faces a Friday deadline to issue an action on the CPP, which was put on hold by the D.C. Circuit Court of Appeals in April. Most sector stakeholders expect the agency to issue a less-stringent rule that requires only modest efficiency improvements at coal plants.

Dive Insight:

Friday is D-Day for the EPA as it evaluates how to dismantle President Obama's Clean Power Plan. The D.C. Circuit granted a stay on litigation over the climate regulations in April and extended it for 60 days at the beginning of August.

Most observers expected Administrator Scott Pruitt to propose a rule that regulates pollution only "inside the fenceline" of existing power plants. The CPP controversially compelled coal plant owners to seek additional emissions abatement from other sources, such as procuring renewables.

The so-called "fenceline provision" was a key argument that CPP critics, including Pruitt, used to challenge the regulations in court last year. Pruitt drafted an "inside the fence" alternative to CPP back in 2014 when he challenged the federal rule as Oklahoma attorney general.

EPA may stop short of issuing a full proposed rule by its Friday deadline. According to a document Reuters said was sent to the agency's Regulatory Steering Committee, it will first seek input from industry stakeholders as part of an Advanced Notice of Proposed Rulemaking​ before issuing the more typical Notice of Proposed Rulemaking. This would likely extend the timeline for the finalization of a CPP replacement.

The Clean Power Plan, finalized in 2015, never went into effect, as the Supreme Court stayed the rule in February 2016 until legal challenges concluded. If the Pruitt EPA does opt to replace the CPP with a less stringent regulation, it could mean the agency will delay or abandon efforts to challenge the 2009 carbon endangerment finding, which compels the EPA to regulate carbon as a public health threat.