This policy practicum addressed Environmental Protection Agency efforts to reduce carbon pollution from electric power plants. The EPA is currently writing New Source Performance Standards for new and existing coal and natural gas fired electric power plants with attention to economically efficient approaches to cutting emissions. States, including California, industry, and environmental groups are all pushing the EPA to incorporate emissions pricing as either a safe harbor or to propose it as a Federal Implementation Plan that States may choose to join. Doing so will cause costs to fall for regulated sectors and may make deeper cuts in emissions feasible. Precedent leads parties to expect that such a proposal will take the form of a cap-and-trade or a mass-based cap on emissions. Adele Morris, the Policy Director for the Climate and Energy Economics Project at the Brookings Institution, asked for our assistance in formulating and assessing the legal implications of an alternative proposal – a carbon tax. Students prepared briefings and written comments to EPA and OMB that explained the potential benefits of a carbon tax approach to New Source Performance Standards and that explored associated legal risks. Students also participated in briefings with key OMB and EPA Air and Radiation staff involved in drafting the proposed rule.

The New Source Performance Standard rulemaking for greenhouse gases is the most environmentally and economically significant regulatory effort that EPA will undertake this decade. Partnering with Brookings allowed us to leverage legal and economic expertise and inject students into the most exciting environmental policy making currently underway in the United States. Doing so now, before the draft rule is published, allowed us to exert maximum influence before the agency loses flexibility to respond to outside input. To develop skills relevant to the work of practicing lawyers, students researched and wrote parts of memos and written comments, on behalf of Morris, to EPA and OMB, explaining their research into various legal and policy aspects of Clean Air Act Section 111 as applied to the problem of power plant emissions.