Undeterred by the Supreme Court's 2022 rebuke in West Virginia v. EPA, the Environmental Protection Agency has finalized a new power plant rule even more ambitious—and reckless—than the Obama-era one struck down in that case. Perhaps the most significant climate measure of the Biden presidency, it would do nearly nothing about the climate. But it will cripple America’s electricity grid and usher in a new era of energy scarcity.

The rule requires all existing coal plants and new natural gas plants that run frequently to eliminate virtually all carbon emissions by using carbon capture technology starting in 2032. The new standards will be virtually impossible for electrical utilities to meet. The Energy Information Administration expects virtually all coal plants—from which Americans get 16% of their electricity—to shut down by 2032 under the rule. And meantime the rule has already frozen investment in the large combined-cycle natural gas plants that are the mainstays of America’s power grid.

The impossibility of meeting the new standards is a major legal vulnerability. Under Section 111 of the Clean Air Act the new standards must be based on technologies that have been “adequately demonstrated,” which means that somebody in the industry has successfully used it to achieve the mandated emissions rate. But no fossil fuel plant in the world has used carbon capture to get anywhere near the 95% reductions in carbon emissions mandated by the rule; in fact only only one large coal-fired power plant has managed to reduce even a fraction of its carbon emissions with carbon capture.

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EPA must also consider cost. But its estimate of billions in net benefits is based on an accounting trick, reducing its estimate of the rule’s costs by the amounts of lavish congressional subsidies for renewable energy in the Inflation Reduction Act, as if costs disappear when you shift them from people in their capacity as ratepayers to the same people in their capacity as taxpayers. 

Moreover, Princeton’s prominent “Net-Zero America” study estimates that 68,000 miles of carbon transport pipelines would have to be built to decarbonize the power grid. Most of that would have to be built by 2032 for utilities to be able to comply with this rule. But that infrastructure buildout would be outside EPA jurisdiction and beyond the control of regulated utilities, which raises the same “major question” that led the Supreme Court to strike down the Obama plan. And because pipelines are outside EPA’s jurisdiction, they are also outside it’s expertise; in fact, EPA has no idea how long it would take or how much it would cost to build the enormous infrastructure that would be required for utilities to be able to comply with the rule, raising prohibitive risks for investment capital.

The cumulative impact of the new EPA rule with the chaotic rush to deploy heavily subsidized intermittent solar and wind capacity to the grid Is poisoning the economics of baseload generation in the U.S. Even without the rule, existing nuclear, coal, and combined-cycle natural gas plants in some regions increasingly have to remain idle most of the time, because they can’t compete with the inordinate over-abundance of solar power in the middle of the day, when solar plants often pay customers to buy electricity. Now new natural gas plants will have to remain idle most of the time just to avoid triggering the new rules, which apply to plants that run frequently. Few will be able to recoup their costs.

EPA’s timing couldn’t be worse. Supercharged by electric vehicles (EV) and power-hungry AI data centers, a tsunami of new demand is headed for America’s electricity grid. In December, national grid regulator NERC forecast demand growing by 7% over the next decade, or 91GW. But forecasts are soaring by the month. Just this week, Texas’s ERCOT forecast nearly that much demand growth in Texas alone by 2030. And those forecasts don’t take into account EPA’s new mandate that 2/3rds of all cars sold in America be pure electric by 2032.

America relies on coal for 16% of its electricity, and on natural gas for another 40%. Add up the expected retirements of coal and the tsunami of demand headed our way, and America is facing a shortfall at least 30% in grid capacity, perhaps 400 GW, by 2032. To understand how staggering this is, consider that building 200 new nuclear reactors, tripling America’s current fleet, would barely suffice to make up the shortfall. And that figure is purely academic, as only a handful of reactors have been built since 1979, because of suffocating red tape.

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The Biden administration is counting on renewables to come to the rescue, but that is a pie in the sky. In 2023, a record year, America added barely 20 GW of new solar capacity and just over 5 GW of wind. But because such sources are intermittent, the “accredited capacity” of the new additions is closer to 10 GW. And the batteries required to stabilize solar and wind sufficiently to replace baseload power plants are lagging even further behind, with just 4 GW installed last year. At that rate it would take 100 years for renewables to make up the shortfall in grid capacity that America could be facing less than a decade from now.

And the Biden administration can’t even get out of its own way on renewable energy: A new Bureau of Land Management rule will almost certainly severely constrict the development of solar power in western states. Cutting off his nose to spite his face, President Biden has even rolled back President Trump's innovative permitting reforms, which disproportionately benefited renewable energy projects. Worst of all, the Princeton study suggests that 600,000 miles of new transmission lines would be required to connect renewable energy to the grid in a low-carbon scenario, yet building even a 750-mile transmission line in the middle of nowhere can take 15 years.

The only way to make up the looming shortfall would be through a massive expansion of new natural gas capacity. But new natural gas plants are the principal targets of the EPA rule. Indeed, the rule has already frozen investment in the sector, because Section 111 standards go into effect for new and modified plants when proposed. As a result large natural gas projects with permits pending last May have been unable to obtain financing, and will most likely be abandoned. 

With soaring demand for electricity, America is already facing energy poverty in the years ahead. The new EPA rule will make the problem far worse, creating in the years ahead many of the same problems that people keep warning will come from climate change 100 years from now. EPA should stick to its day job of pollution control, and get out of the business of energy regulation, which it has neither the authority nor the expertise to be fooling around with.