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What a Trump Administration Could Mean for Utility MACT

utility mact

In 2011, the Environmental Protection Agency (EPA) issued one of the most controversial regulations of the past two decades – the Mercury and Air Toxics Standards (MATS). MATS, known to many in the industry as Utility MACT (Maximum Achievable Control Technology standard), immediately came under fire from states and private energy producers and embroiled the agency in a long string of embittered court battles that still have yet to run their course.

Now, with the upcoming Trump administration, those who have opposed Utility MACT have reason to celebrate due to President-elect Trump’s noted anti-EPA stance.

However, any actions the Trump administration takes could be too little, too late.

Impact of Utility MACT

Utility MACT was designed to limit the amount and content of emissions generated by coal-fired power plants, as a part of the Obama administration’s Climate Action Plan first promulgated in the early years of President Obama’s first term.

To accomplish this goal, Utility MACT put into place the strictest emissions controls the industry has ever seen. Since coal produces more of these targeted emissions than any other fuel source – in part because coal generates over 40 percent of American electricity – that industry was the hardest hit by the new regulations.

The impact over the last five years since Utility MACT was implemented has been immense, according to industry advocates. The EPA estimates that the regulation cost American power producers $9.6 billion per year. Industry advocates also believe Utility MACT played a major role in the shuttering of dozens of coal-fired plants through 2016 – including 94 coal-fired plants in 2015 and 41 plants that have closed or are scheduled to close this year.

Granted, some factors involved in shuttering plants have little to do with regulation and more to do with the high average age of coal plants in the U.S. – the median age of a coal plant is 54 – and the cheaper cost of natural gas as an energy source.

Still, Utility MACT has been a lightning rod for energy advocates, and a prime target for the Trump administration and the officials that will soon work in the EPA.

Possible Courses of Action for Trump’s EPA

What scenarios exist for Utility MACT under a President Trump-led EPA?

What many of his supporters want is an immediate repeat of utility MACT (along with other regulations, such as the Cross-State Air Pollution Rule and Clean Power Plan). However, it is unlikely that the EPA would be able to rescind the regulation outright. The process to rescind a federal regulation is long and tortuous, involving a complex rulemaking procedure known as notice-and-comment. Additionally, the administration would have to provide an “adequate basis” for rescinding the regulation – which would be rigorously opposed by environmental groups in court, further tying up the issue.

Over the past eight years, courts have been mostly amenable to Utility MACT. Despite numerous challenges by an alliance between states and energy producers, Utility MACT has been in effect for almost two years. Anti-MATS advocates won a brief victory in 2015, when the U.S. Supreme Court narrowly ruled against the EPA, but that decision only resulted in the case being remanded to the D.C. Circuit Court, which ruled in favor of the EPA. This decision prompted a second appeal to the Supreme Court in 2016, which was rejected by the Court in the summer.  

Thus, it’s unlikely that even a conservative-majority Supreme Court would be able to overturn Utility MACT within President Trump’s first term without the energy industry coming up with a new legal angle to attack the regulation.

As outlined by the Daily Environment Report from Bloomberg BNA, the EPA, under a President Trump, could take other courses of action that move away from outright abolition and instead seek to mitigate the impact of the ruling. The administration could be lax on enforcement. The administration could also encourage Congress to take action and mitigate or overturn the ruling through legislative action, although that path would likely be highly contentious and detract from Republican legislators’ larger priorities in attacking the Clean Power Plan and Clean Water Rule.

Anti-Regulation Action May Not Make a Difference

What is most discouraging for the industry, though, is the fact that any action by the Trump administration could be too little, too late.

The vast majority of coal-fired plant owners have either shuttered their facilities or invested in modifying their plants to comply with the EPA’s current regulations. There would be little to gain from a repeal of Utility MACT at this point.

Repealing the regulation would nominally help plant owners who haven’t already taken action, and would in theory lower operating costs by some degree. Repeal would also make it less expensive to build new plants (although new coal-fired plant construction has dramatically declined over the past decade, and prospects look dim for future construction).

In all actuality, though, Utility MACT has already made a lasting impact on domestic energy production, impact that – for better or for worse – can’t be easily undone.