Donald Trump’s administration is finalizing plans to roll back the US government’s only direct efforts to curb coal-fired power plant pollution that is heating the planet.

Trump’s Environmental Protection Agency will replace an Obama-era climate change rule with a regulation that experts warn could help some of America’s oldest and dirtiest coal plants to keep running.

Obama’s Clean Power Plan would have pushed power companies to shift away from coal and toward natural gas and renewable power. Trump’s rule instead sets out ways for states to direct coal plants to increase their efficiency, with hardware fixes or operational changes.

Trump’s rule will not significantly tackle the heat-trapping gases entering the atmosphere that cause extreme heatwaves, floods and other disasters. And it will lead to higher levels of air pollution, compared with the Clean Power Plan.

“I believe this is the first rule in EPA’s history that acknowledges the existential threat of climate change but by the agency’s own admission does absolutely nothing to stop it,” said Obama’s EPA chief Gina McCarthy. “The Trump administration has made painfully clear that they are incapable of rising to the challenge and tackling this crisis. They have shown a callous disregard for EPA’s mission, a pattern of climate science denial, and an inexcusable indifference to the consequences of climate change.”

But the Trump administration is defending the change, arguing it is limited by law in how it can regulate the emissions that cause rising temperatures.

The EPA administrator, Andrew Wheeler, a former coal lobbyist, on Wednesday said the Obama rule would have raised electricity costs for poorer Americans. But even without that rule taking effect, power companies have been shutting down coal plants, which are more expensive than their cleaner competitors natural gas and renewable energy.

Wheeler argued EPA is “leveling the playing field” for coal, although the rule is not expected to significantly boost the US coal industry, which has been in decline for years. The National Mining Association, which represents coal companies, praised the rule, saying it preserves “the rightful authority of the states to manage their own unique energy infrastructure and electric grids”.

Wheeler positioned the policy as Republicans’ alternative to the Green New Deal proposed by progressives.

Wheeler said: “Rather than Washington telling Americans what type of energy they can use or how they can travel or even what they can eat, we are working cooperatively with the states to provide an affordable, dependable and diverse supply of energy that continues to get cleaner and more efficient.”

Joe Goffman, a Harvard professor and former EPA general counsel, called EPA’s legal arguments “tortured” and “deceptive”.

Goffman said the rule “demonstrates the Trump administration’s determination not only to avoid taking action to address climate change but also to obstruct current and future efforts by states and successors to cut greenhouse gas pollution”.

Democratic-led states and environment advocates are expected to challenge the rule in lawsuits. Attorneys general in New York and Connecticut on Wednesday quickly announced their intent to sue, and many more states are expected to join them. Trump’s agency argues it does not have legal authority to regulate climate change. If the courts agree, future US climate efforts could be in jeopardy.

Coal plant air pollution – from tiny particles that enter the lungs – cause breathing problems and early deaths. According to an earlier estimate from EPA, the new rule could lead to 1,400 more deaths each year.

One academic analysis estimates that over a decade the repeal could lead to 36,000 deaths, and that other Trump environment rollbacks could lead to a total to 80,000 deaths.

Paul Billings, executive director of the American Lung Association, said: “If certain changes are made, we could see the oldest, dirtiest plants run more and that will increase the overall burden caused by the pollution.”

Trump and many of his officials have questioned the science that shows rapid global action is needed to limit heat-trapping gases and protect people against a mounting crisis.

His agencies have slashed programs designed to limit carbon dioxide from power plants, cars and trucks, and encouraged oil drilling and coal mining.

The US has sent more carbon dioxide into the atmosphere than any other country. It is currently the world’s second largest emitter.

America’s electricity sector has been rapidly decreasing its climate pollution, even though the Clean Power Plan was stalled by the supreme court and never took effect. Natural gas and renewable power have proved to be cheaper than coal.

Power plants are responsible for less than a third of US emissions. And data shows the US saw a rise in overall carbon levels last year.

Trump’s rule includes help for states to improve coal plant efficiency. That list does not include technologies to capture the carbon dioxide produced by a coal plant.

Although Trump has said he will withdraw from the Paris pact to fight the climate crisis, other countries have stayed in. Still, their efforts are far behind what scientists say is necessary to avoid the worst of the climate emergency.