API Highlights Infrastructure Barriers and Reliability Concerns in EPA Power Plant Rule

Urges EPA to Consider Timeline & Interagency Coordination, Notes Permitting Challenges Remain

WASHINGTON, August 9, 2023 – The American Petroleum Institute (API) yesterday filed comments outlining challenges to meeting the tight timeline for compliance in the U.S. Environmental Protection Agency’s (EPA) proposed regulation of greenhouse gas (GHG) emissions from U.S. power plants. API echoed grid operators, electric utilities and regulatory authorities in emphasizing the importance of the flexibility and dispatchability of natural gas-powered generators, which are critical to maintaining a reliable electricity grid while continuing to reduce CO2 emissions and supporting variable renewable resources. 

While carbon capture (CCS) and hydrogen are promising technologies to help reduce GHG emissions, operators will need time to develop and build significant amounts of new infrastructure to support the deployment of these technologies, a task that is increasingly difficult with our nation’s complex and outdated permitting process.

“We urge EPA to comprehensively analyze the potential reliability risks of its proposal, recognizing it coincides with rising U.S. electricity demand. Today natural gas is responsible for 40% of electricity generation in America, helping meet growing demand and balancing variable renewable resources,” API Senior Vice President of Policy, Economics and Regulatory Affairs Dustin Meyer said. “Our industry is a leading innovator in low-carbon technologies like CCS and hydrogen, but significant overlapping regulatory and permitting hurdles threaten the buildout of the significant infrastructure needed to comply with this proposal.”

In filed comments, API outlines the procedural and regulatory challenges that will need to be resolved to develop the necessary energy infrastructure, including federal, state and local permitting challenges and questions surrounding the siting and regulation of carbon and hydrogen pipelines. 

• Carbon Pipelines: America’s oil and natural gas industry currently operates more than 5,000 miles of carbon pipelines and EPA’s proposal would require the construction of more than 4-5 times the existing footprint – an additional 20,000 to 25,000 miles of carbon pipelines to support CCS. 
• Siting Authority: There is a significant lack of clarity surrounding siting authority for interstate CO2 pipelines.
• Geologic Storage: Large parts of the East Coast – particularly New England – lack local geological storage for CCS and will have to rely on intrastate pipelines to transport CO2 to suitable storage sites hundreds of miles away. 
• Carbon Capture Permitting: Two active Class VI permits both took at least 3 years for the EPA to approve, with one taking 6 years from the time of the initial permit application to the final authorization to inject. 
• NEPA Timeline: The average EIS takes four and a half years to complete, adding significant time to a project’s development to meet EPA’s implementation deadlines.

While the permitting changes in the Fiscal Responsibility Act represented a step in the right direction on meaningful permitting reform, more is needed to establish a transparent, timely and consistent permitting process that would allow for the development of energy infrastructure projects, including those needed to comply with EPA’s proposal. 

API also highlights its concern with EPA’s narrow definitions for qualifying hydrogen projects, which are at odds with those established by Congress in Section 45V and could lead to insufficient quantities of hydrogen production, limiting its role in reducing emissions.  

Without action to address these concerns, EPA’s proposal could jeopardize grid stability by forcing natural gas-powered power plants offline at a time when reliability challenges are already a concern and power demand is only expected to increase. Between 2005-2021, overall power sector emissions declined by nearly 40%, with about 60% of the emissions reductions driven by fuel switching to natural gas.  

“The oil and natural gas industry has long been at the forefront of innovation, and it stands ready to work with policymakers to ensure grid reliability while advancing the robust development of the CCS and hydrogen markets,” Meyer concludes.   

Click here to view a full copy of API’s comments. 

API represents all segments of America’s natural gas and oil industry, which supports more than 11 million U.S. jobs and is backed by a growing grassroots movement of millions of Americans. Our 600 members produce, process and distribute the majority of the nation’s energy, and participate in API Energy Excellence®, which is accelerating environmental and safety progress by fostering new technologies and transparent reporting. API was formed in 1919 as a standards-setting organization and has developed more than 800 standards to enhance operational and environmental safety, efficiency and sustainability.

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