Updated Modeling Analysis of EPA's Clean Power Plan

On June 1, 2016, M.J. Bradley & Associates published an updated modeling analysis of the Environmental Protection Agency’s final Clean Power Plan, with insights and constructive feedback from several utilities, trade associations and NGOs, including the Natural Resources Defense Council. The updated study reflects several assumption changes from our January report, including the extension of the renewable energy tax credits for wind and solar. The study includes two Reference Cases (business-as-usual scenarios) and eight alternative Clean Power Plan regulatory scenarios.

• The Clean Power Plan is projected to achieve CO2 emissions reductions of greater than 30% by 2030 from 2005 levels, across a range of scenarios and assumptions.

   

• The tax credits for wind and solar are projected to boost investment in wind and solar technologies before the Clean Power Plan goes into effect, easing compliance.

   

• Under a mass-based approach with a broad trading program, the study projects modest CO2 allowance prices. Energy efficiency investments further moderate allowance prices.

   

• The updated analysis continues to find that CO2 emissions would increase with an “existing only” mass-based program (with no leakage protection) versus an “existing plus new” or “dual rate” approach.

M.J. Bradley & Associates developed the assumptions for the study and ICF International conducted the model runs using its Integrated Planning Model (IPM®). IPM® is a detailed model of the electric power system that is used routinely by industry and regulators to assess the effects of environmental regulations and policy. It integrates extensive information on power generation, fuel mix, transmission, energy demand, prices of electricity and fuel, environmental policies, and other factors.

System Costs, Average Bills, and Emissions: Supplemental Data