The Trump administration moved to overturn Obama-era environmental rules on power-plant emissions, a long-telegraphed action designed to help coal-burning plants compete with natural gas and other cleaner alternatives as a national energy source.

Andrew Wheeler, President Trump’s acting administrator of the Environmental Protection Agency, on Monday signed a proposal to scrap environmental restrictions on power plants and leave much of the regulation of the industry to states. The move is the agency’s first under Mr. Trump to detail how it will regulate the power-sector carbon emissions that contribute to climate change, and it sets up months of public and legal reviews, and potentially a yearslong court battle.

Environmental groups are already plotting a challenge, saying the proposal at best provides minimal legal cover for a 2007 Supreme Court decision requiring the agency to regulate carbon emissions as a pollutant. They will likely seek to reinstate the Obama-era policy, called the Clean Power Plan, which itself is hung up at the Supreme Court in a case about whether it was illegally broad.

The new plan, an advance copy of which was reviewed by The Wall Street Journal, recommends a menu of upgrades designed to let coal-fired plants produce energy with less fuel and seeks to eliminate triggers that mandate costly technological overhauls at coal plants. While the Clean Power Plan was designed to reduce greenhouse gases and fight the cause of climate change, the Trump administration cast the regulation as setting unfair rules that coal plants wouldn’t be able to meet.

“The entire Obama administration plan was centered around doing away with coal,” Mr. Wheeler said in an interview.