Whats Ahead for Power Plants & Industry? Using the Clean Air Act to Reduce GHGs, Building on Regional Programs

This working paper examines how the U.S. Environmental Protection Agency (EPA) and individual states can utilize section 111 of the Clean Air Act to establish performance standards for reducing greenhouse gas emissions from existing power plants and industrial facilities, specifically exploring the viability of market-based cap-and-trade mechanisms.

• Power plants and industrial facilities are critical targets for climate policy as they account for 50% of all greenhouse gas emissions in the United States.
• Section 111 of the Clean Air Act provides the EPA and states with significant flexibility in how they regulate existing power plants and industrial facilities. While traditional regulation involves source-specific emissions limitations, the EPA under George W. Bush determined that cap-and-trade is a permissible form of regulation under Section 111(d), a view not contested by the Obama-era EPA.
• Twenty-three states have already designed or implemented flexible, market-based emissions-trading mechanisms to reduce greenhouse gases from industrial and power sources.
• Integrating regional cap-and-trade designs with section 111 of the Clean Air Act presents several regulatory challenges: offsets cannot be used to meet federal minimum reductions (though they may be used above those minimums), the legality of trading between different regulated source categories depends on EPA interpretation, and borrowing or safety valve mechanisms are problematic if they jeopardize minimum reductions within federal timeframes.
• The EPA established a timeline for regulating power plants and refineries under section 111, with draft performance standards for new and modified power plants and draft mandatory guidelines for states expected by July 26, 2011, and final rules expected in May 2012. Refineries were scheduled for draft rules in December 2011 and final rules in November 2012.

APA

World Resources Institute (n.d.). Whats Ahead for Power Plants & Industry? Using the Clean Air Act to Reduce GHGs, Building on Regional Programs. https://www.wri.org/research/whats-ahead-power-plants-industry-using-clean-air-act-reduce-ghgs-building-regional

Chicago

World Resources Institute. Whats Ahead for Power Plants & Industry? Using the Clean Air Act to Reduce GHGs, Building on Regional Programs. n.d. https://www.wri.org/research/whats-ahead-power-plants-industry-using-clean-air-act-reduce-ghgs-building-regional.

Wikipedia

{{cite report |author=World Resources Institute |title=Whats Ahead for Power Plants & Industry? Using the Clean Air Act to Reduce GHGs, Building on Regional Programs |url=https://www.wri.org/research/whats-ahead-power-plants-industry-using-clean-air-act-reduce-ghgs-building-regional |access-date=17 August 2026 |via=Climate Insights Directory}}

BibTeX

@techreport{worldresourcesinstitutendwhats, author = {{World Resources Institute}}, title = {{Whats Ahead for Power Plants \& Industry? Using the Clean Air Act to Reduce GHGs, Building on Regional Programs}}, institution = {World Resources Institute}, url = {https://www.wri.org/research/whats-ahead-power-plants-industry-using-clean-air-act-reduce-ghgs-building-regional}, urldate = {2026-08-17}, note = {Indexed by Climate Insights Directory} }