REGULATORY: Environmental: The President's Climate Action Plan - Mixed Messages for the Energy Sector

by King & Spalding

On June 25, 2013 President Obama released his Climate Action Plan.[1] He identified three overarching goals – (1) Cut domestic carbon emissions, (2) Support climate adaptation efforts, and (3) Demonstrate international climate leadership. The Plan is long on ambitious goals and short on details, but clearly will impact businesses in the energy sector.

Natural Gas – Lots to Like, But …

Natural gas is a clear favorite under the Plan, at least for the foreseeable future. In his speech, the President reiterated that "[w]e should strengthen our position as the top natural gas producer because, in the medium term at least, it not only can provide safe, cheap power, but it can also help reduce our carbon emissions." However, the Plan also includes provisions that would ramp up regulation of natural gas operations:

  • Creating methane emission reduction strategies, including programs or rules for pipeline upgrades, and less venting and flaring
  • Instituting international best practices for unconventional natural gas development

Moreover, nothing in the Plan indicated any change to the Administration's intentions to move forward on additional natural gas regulation, including emissions standards for pipeline compressors and water management for production sites.

Coal – Almost Nothing to Cheer About

The central pillar of the plan to cut carbon emissions is a directive to the U.S. Environmental Protection Agency (EPA) to set emission standards for greenhouse gases generated by power plants.[2] In a companion memorandum to EPA, the Plan sets deadlines for these standards:

  • September 20, 2013 – Re-proposal of the New Source Performance Standard (NSPS) for new plants, with a Final Rule issued at a later date (must be prior to June 2014)[3]
  • June 2014 – Proposal of NSPS for existing plants
  • June 2015 – Final NSPS for existing plants
  • June 2016 – Deadline for states to submit State Implementation Plans for implementing the standards

Like the Plan, the Memorandum is not particularly detailed. While it outlines several considerations to be followed in the standard-setting process, including engagement with States and other stakeholders, cost control, allowing market-based approaches, energy efficiency, and a vague direction to ensure "continued reliance on a range of energy sources and technologies," neither the Plan nor the Memorandum provides any of the substance the business sector had hoped to see. Litigation over most aspects of these rules is virtually certain, adding additional uncertainty for businesses seeking to plan for these rules.

The Plan's international leadership goal also impacts coal. Specifically, it calls for eliminating U.S. foreign aid for fossil fuel facilities, and ending public financing of overseas coal-fired power projects.[4] Thus, investors and businesses can expect the Administration to exert pressure on the World Bank and other lending institutions to follow suit.

Renewables – More Money

No real surprises here – the Plan articulates several objectives in support of renewable energy. As he said in his speech, the President's Plan "direct[s] the Interior Department to green light enough private, renewable energy capacity on public lands to power more than 6 million homes by 2020." Overall, the Plan aims to double renewable electricity generation by 2020, by expediting permitting of clean energy generation projects and transmission infrastructure projects. Other objectives include investing in advanced biofuels and other transportation technologies, as well as federal financing for energy efficiency investments.

Oil – Brief Surprise, But Not Much to Talk About

In a surprise move, the President's speech mentioned the Keystone XL Pipeline project. "Allowing the Keystone pipeline to be built requires a finding that doing so would be in our nation's interest. And our national interest will be served only if this project does not significantly exacerbate the problem of carbon pollution." Predictably, the vague statement has both sides of the Keystone debate declaring victory. The Plan also calls for the end of tax incentives that benefit oil production.

Energy Efficiency – An Early Mover?

Provisions centered on energy efficiency run throughout most aspects of the Plan. Achieving an ambitious target of 3 billion metric tons in efficiency gains by 2030, coupled with few technological barriers to implementation, reasonably ensures that energy efficiency programs and standards will be early priorities. For the energy sector, likely targets include industrial motors, commercial refrigeration units, and other utility fixtures.

A Handful of Other Objectives

An assortment of other objectives rounds out the Plan with respect to the energy sector.

  • Fuels - Directing EPA to develop post-2018 fuel economy standards for heavy-duty vehicles
  • Insurance - Developing best practices for insuring against climate risks
  • Land-Use - Integrating climate adaptation into land and water conservation decisions
  • Trade - Prompting WTO negotiations on free trade in clean energy technologies (solar, wind, hydro, and geothermal) and other environmental goods, based on a list developed in 2011 by the Asia-Pacific Economic Cooperation (APEC) countries.[5]

Looking Forward

In the few days since the Plan's issuance, debate, and discussion has already flourished. For businesses in the energy sector, the Plan offers much to consider.

[1] Executive Office of the President, The President's Climate Action Plan (June 2013).
[2] Memorandum for the Administrator of the Environmental Protection Agency (June 25, 2013).
[3] A final rule for new plants is the trigger for regulating existing plants.
[4] A limited exception applies where no other economically feasible alternative exists or the project includes carbon capture technology.
[5] The 2011 APEC list of environmental goods includes a range of products, including parts for clean energy generation (biomass, wind, landfill gas), sludge driers, and other waste water treatment equipment, solar cells, emissions monitoring technologies, and analytical equipment.


Written by:

King & Spalding

King & Spalding on:

Readers' Choice 2017
Reporters on Deadline

"My best business intelligence, in one easy email…"

Your first step to building a free, personalized, morning email brief covering pertinent authors and topics on JD Supra:
Sign up using*

Already signed up? Log in here

*By using the service, you signify your acceptance of JD Supra's Privacy Policy.
Custom Email Digest
Privacy Policy (Updated: October 8, 2015):

JD Supra provides users with access to its legal industry publishing services (the "Service") through its website (the "Website") as well as through other sources. Our policies with regard to data collection and use of personal information of users of the Service, regardless of the manner in which users access the Service, and visitors to the Website are set forth in this statement ("Policy"). By using the Service, you signify your acceptance of this Policy.

Information Collection and Use by JD Supra

JD Supra collects users' names, companies, titles, e-mail address and industry. JD Supra also tracks the pages that users visit, logs IP addresses and aggregates non-personally identifiable user data and browser type. This data is gathered using cookies and other technologies.

The information and data collected is used to authenticate users and to send notifications relating to the Service, including email alerts to which users have subscribed; to manage the Service and Website, to improve the Service and to customize the user's experience. This information is also provided to the authors of the content to give them insight into their readership and help them to improve their content, so that it is most useful for our users.

JD Supra does not sell, rent or otherwise provide your details to third parties, other than to the authors of the content on JD Supra.

If you prefer not to enable cookies, you may change your browser settings to disable cookies; however, please note that rejecting cookies while visiting the Website may result in certain parts of the Website not operating correctly or as efficiently as if cookies were allowed.

Email Choice/Opt-out

Users who opt in to receive emails may choose to no longer receive e-mail updates and newsletters by selecting the "opt-out of future email" option in the email they receive from JD Supra or in their JD Supra account management screen.


JD Supra takes reasonable precautions to insure that user information is kept private. We restrict access to user information to those individuals who reasonably need access to perform their job functions, such as our third party email service, customer service personnel and technical staff. However, please note that no method of transmitting or storing data is completely secure and we cannot guarantee the security of user information. Unauthorized entry or use, hardware or software failure, and other factors may compromise the security of user information at any time.

If you have reason to believe that your interaction with us is no longer secure, you must immediately notify us of the problem by contacting us at In the unlikely event that we believe that the security of your user information in our possession or control may have been compromised, we may seek to notify you of that development and, if so, will endeavor to do so as promptly as practicable under the circumstances.

Sharing and Disclosure of Information JD Supra Collects

Except as otherwise described in this privacy statement, JD Supra will not disclose personal information to any third party unless we believe that disclosure is necessary to: (1) comply with applicable laws; (2) respond to governmental inquiries or requests; (3) comply with valid legal process; (4) protect the rights, privacy, safety or property of JD Supra, users of the Service, Website visitors or the public; (5) permit us to pursue available remedies or limit the damages that we may sustain; and (6) enforce our Terms & Conditions of Use.

In the event there is a change in the corporate structure of JD Supra such as, but not limited to, merger, consolidation, sale, liquidation or transfer of substantial assets, JD Supra may, in its sole discretion, transfer, sell or assign information collected on and through the Service to one or more affiliated or unaffiliated third parties.

Links to Other Websites

This Website and the Service may contain links to other websites. The operator of such other websites may collect information about you, including through cookies or other technologies. If you are using the Service through the Website and link to another site, you will leave the Website and this Policy will not apply to your use of and activity on those other sites. We encourage you to read the legal notices posted on those sites, including their privacy policies. We shall have no responsibility or liability for your visitation to, and the data collection and use practices of, such other sites. This Policy applies solely to the information collected in connection with your use of this Website and does not apply to any practices conducted offline or in connection with any other websites.

Changes in Our Privacy Policy

We reserve the right to change this Policy at any time. Please refer to the date at the top of this page to determine when this Policy was last revised. Any changes to our privacy policy will become effective upon posting of the revised policy on the Website. By continuing to use the Service or Website following such changes, you will be deemed to have agreed to such changes. If you do not agree with the terms of this Policy, as it may be amended from time to time, in whole or part, please do not continue using the Service or the Website.

Contacting JD Supra

If you have any questions about this privacy statement, the practices of this site, your dealings with this Web site, or if you would like to change any of the information you have provided to us, please contact us at:

- hide
*With LinkedIn, you don't need to create a separate login to manage your free JD Supra account, and we can make suggestions based on your needs and interests. We will not post anything on LinkedIn in your name. Or, sign up using your email address.