The Environmental Protect Agency on Wednesday said it would begin a sweeping rollback of environmental regulations, including air, water and waste rules that affect the power sector.

“Today is the greatest day of deregulation our nation has seen,” EPA Administrator Lee Zeldin said in a press release. “We are driving a dagger straight into the heart of the climate change religion to drive down cost of living for American families, unleash American energy [and] bring auto jobs back to the U.S.”

Industry observers expected the EPA under the Trump administration would seek to revise regulations affecting the power sector, especially rules that have contributed to making it uneconomic to keep coal-fired power plants operating.

Revising or eliminating the rules will require rulemaking processes that can take several years to complete, Capstone said in a client note Wednesday. “With EPA also making significant cuts to its staff, the agency faces serious logistical challenges to releasing final rules that do not run afoul of the [Administrative Procedure Act] in any of these areas,” the research firm said.

Litigation would add at least a year to the process of revising the regulations, so some of the planned deregulatory actions would likely not be finished before the next presidential administration begins, Capstone analysts said.

Also, many of the power sector-related regulations that could be revised are being litigated in court, extending the timeline for any new regulation to take effect, the analysts noted.

However, the EPA said it aims to take interim measures that would reduce regulatory burdens from some of its rules.

For example, the agency said it is considering granting a two-year exemption to power plants affected by its mercury and air toxics standards rule while the agency conducts a rulemaking process to revise the regulation.

Deregulating the power sector would “substantially” reduce compliance costs for independent power producers and utilities with coal- and gas-fired power plants, including companies such as Talen Energy, Dominion Energy, Duke Energy and Southern Co., Capstone analysts said.

Other power sector-related regulations the EPA plans to reconsider include:

• National ambient air quality standards for particulate matter, or soot. The agency said it would soon issue guidance to increase flexibility on NAAQS implementation, reforms to new source review and direction on permitting obligations.
• The “Good Neighbor Plan,” which aims to prevent emissions from power plants and other sources that cause ozone to drift into other states.
• The coal combustion residuals rule that covers how waste from coal-fired power plants is handled. The EPA plans to give states a larger role in overseeing coal ash.
• The Effluent Limitation Guidelines that regulate wastewater from power plants.
• The regional haze rule.
• Vehicle emissions standards that the Trump administration says cannot be met by internal combustion engines and function as an “electric vehicle mandate.”

With other agencies, the EPA said it plans to reconsider its 2009 “endangerment finding” that forms the basis for regulating greenhouse gas emissions under the Clean Air Act.

“For more than 15 years, the U.S. government used the finding to pursue an onslaught of costly regulations — raising prices and reducing [electric] reliability,” Department of Energy Secretary Chris Wright said in a press release. “It’s past time the United States ensures the basis for issuing environmental regulations follows the science.”

The EPA faces hurdles in overturning the endangerment finding, including that the scientific evidence on how carbon emissions affect the climate has increased since the finding was made, according to attorneys with Akin Gump Strauss Hauer & Feld. Also, the endangerment finding has withstood various legal challenges, with the U.S. Supreme Court declining to hear challenges to it in December 2023, the firm said in a Feb. 19 note.

The agency plans to undo rules set under the Biden administration that aim to reduce carbon emissions from power plants. Under the EPA’s rule, issued in April 2024, the owners of coal-fired and new gas-fired power plants set to operate past 2039 will be required to meet a carbon dioxide emission standard equal to installing a carbon capture and storage system and running it at 90% efficiency, with compliance beginning in 2032.

The U.S. Supreme Court in October rejected “emergency applications” by utilities, independent power producers and others seeking to put the rule on hold while litigation is underway in the U.S. Court of Appeals for the D.C. Circuit.

The EPA also plans to consider eliminating its Greenhouse Gas Reporting Program, which Zeldin said is “burdensome.” The program, set up in 2009, requires GHG reports from sources that release 25,000 metric tons or more of carbon dioxide a year in the United States. It affects about 8,000 sources, including power plants, according to the agency.

Zeldin said the EPA intends to reconsider the “social cost of carbon,” a measure used in regulatory cost-benefit analysis to assess the economic effects of climate change.