A Week of Climate Action: Spotlight on the Biden-Harris Administration’s Earth Week Regulatory and Grant-Funding Actions

First observed on April 22, 1970, Earth Day has long been recognized as a watershed moment for the modern environmental movement. On that day, over 20 million demonstrators nationwide marched to raise awareness of the need to protect and preserve the environment. The energy generated from that day galvanized the country to action, leading to the creation of the U.S. Environmental Protection Agency (EPA) in December 1970 and the passage of several statutes later that decade-including the Clean Air Act (CAA) the Clean Water Act (CWA), the Endangered Species Act (ESA), and the Resource Conservation and Recovery Act (RCRA)-that serve as the foundation of U.S. environmental legislation. Today, Earth Day is recognized by countries around the world, and has expanded from its initial focus on pollution control to include elevating environmental justice in low-income, disadvantaged, and indigenous communities and promoting domestic and international climate action.

Beginning with a proclamation on April 19 declaring climate change to be "the existential crisis of our time," the Biden-Harris Administration marked Earth Day and the week after by announcing a suite of final rules and grant programs aimed at fossil fuel abatement and pollution control, accelerating electric transmission grid modernization and solar energy development, and reducing greenhouse gas (GHG) emissions from the transportation sector. These actions underscore not only the continued "whole-of-government" approach that the Administration has taken to combat climate change but also the urgency with which federal agencies have moved to promulgate final rules and protect them from potential congressional revocation ahead of the Congressional Review Act deadline later this spring.

To assist industries and markets as they evaluate the impact of these final rules and programs, we've spotlighted several of these Earth Week regulatory and grant-funding actions.

Fossil Fuel Abatement and Pollution Control

Standards to Reduce Pollution from Fossil Fuel-Fired Power Plants. On April 25, EPA announced four final rules aimed at reducing pollution from fossil fuel-fired power plants.

Final Rule	Authority	Effect
Greenhouse Gas Standards and Guidelines for Fossil Fuel-Fired Power Plants	Section 111 of the CAA (40 CFR Part 60)	Repeals the Affordable Clean Energy (ACE) rule that was enacted by the Trump Administration in June 2019 and subsequently vacated by the D.C. Circuit in January 2021. Sets new emissions standards to ensure that all coal-fired plants that plan to operate in the long-term and all new baseload gas-fired plants control 90 percent of their carbon pollution. Significantly, the final rule does not set emissions guidelines for existing gas-fired plants, though the rule states that EPA "plans to expeditiously issue an additional proposal" to address these plants.
Mercury and Air Toxics Standards	Section 112 of the CAA (40 CFR Part 63)	Strengthens and updates the Mercury and Air Toxics Standards (MATS) for coal-fired power plants by tightening the emissions standard for toxic metals by 67 percent and finalizing a 70 percent reduction in the emissions standard for mercury from existing lignite-fired plants.
Steam Electric Power Generating Effluent Guidelines	CWA (40 CFR Part 423)	Strengthens the discharge standards for four types of wastewater generated by coal-fired power plants: flue gas desulfurization wastewater, bottom ash transport water, combustion residual leachate, and various legacy wastewaters.
Legacy Coal Combustion Residuals (CCR) Surface Impoundments and CCR Management Units	RCRA (40 CFR Parts 9 and 257)	Establishes regulatory requirements for the management of coal ash at inactive coal-fired power plants with unused surface impoundments and historical coal ash disposal areas at active coal-fired power plants.

Revised Procedures for Chemical Risk Evaluations Under the Toxic Substances Control Act. In addition to these regulations targeting fossil fuel-fired power plants, on April 23, EPA issued a final rule amending the procedural framework rule for conducting chemical risk evaluations under the Toxic Substances Control Act (TSCA). Promulgated under section 6(b)(4)(15) of TSCA at 40 CFR Part 702, the purpose of chemical risk evaluations is to determine if a chemical substance presents "an unreasonable risk of injury to health or the environment, without consideration of costs or non-risk factors." The final rule revises certain regulatory definitions and amends the process and requirements that manufacturers and importers of chemical substances must follow when requesting that EPA conduct a chemical risk evaluation.

Accelerating Electric Transmission Grid Modernization and Solar Energy Development

On April 25, the U.S. Department of Energy (DOE) announced two final rules aimed at streamlining the permitting and approval process for electric transmission projects and energy storage systems projects, such as solar and wind energy projects.

• Establishing the Coordinated Interagency Transmission Authorizations and Permits (CITAP) Program.The CITAP Program establishes DOE as the lead agency for coordinating federal environmental reviews and permitting processes for electric transmission projects that are (1) used in interstate or international commerce and are expected to require an environmental impact statement, or (2) are approved by the DOE Grid Deployment Office. The rule also sets a two-year deadline for DOE to issue permits and authorizations and enables developers to request that the President issue the appropriate permit if DOE does not adhere to that deadline, which DOE expects will cut the average permitting process for a transmission project by nearly half. Alongside this final rule, DOE announced up to $331 million in funding from the 2021 Bipartisan Infrastructure Law to support a new transmission line from Idaho to Nevada.
• Revising DOE's National Environmental Policy Act (NEPA) Implementing Procedures. The final rule adds a categorical exclusion for certain energy storage system projects and revises existing categorical exclusions for upgrading powerlines and for solar energy storage systems. Under NEPA, a categorical exclusion is a category of federal actions that the implementing agency has determined does not individually or cumulatively have a significant effect on the human environment and therefore does not require the preparation of an environmental impact statement or environmental assessment. By adding and revising categorical exclusions for energy storage systems and electric transmission projects, DOE aims to promote the development of and reduce the regulatory barriers associated with these projects. This final rule comes just ahead of an expected "Phase 2" NEPA rule by the White House Council on Environmental Quality.

Separately, on April 22, EPA announced sixty selectees for funding under the Solar for All Grant Program, a $7 billion grant program established by the Inflation Reduction Act's Greenhouse Gas Reduction Fund (GGRF) that is designed to deliver residential solar projects nationwide. The Solar for All announcement comes on the heels of EPA's earlier GGRF announcement on April 4 of three selectees for $14 billion of funding under the National Clean Investment Fund and five selectees for $6 billion of funding under the Clean Communities Investment Accelerator to create a national financing network for clean energy projects.

Reducing GHG Emissions from the Transportation Sector

On April 24, the Biden-Harris Administration set a national goal to transition the truck, rail, aviation, and marine freight sector to net-zero emissions. The national goal operationalizes the global Drive to Zero Memorandum of Understanding, signed by the United States at COP27 in 2022, which commits signatory countries to enable 100% zero-emission new truck and bus sales by 2040 and sets an interim goal of 30% zero emission vehicle sales by 2030. This builds on EPA's action on March 29 finalizing new standards for greenhouse gas emissions from heavy-duty vehicles for Model Years 2027-2032. As part of this national goal, the Administration announced the following actions:

• Clean Heavy-Duty Vehicles Grant Program. On April 24, EPA launched the Clean Heavy-Duty Vehicles Grant Program, a $1 billion program designed to fund the replacement of certain heavy-duty vehicles, including school buses and utility and delivery trucks, with zero-emission vehicles. Entities will be able to apply for grant funds through two funding opportunities: the School Bus Sub-Program (70% of funding) for applicants that seek to replace school buses, and the Vocational Vehicles Sub-Program (30% of funding) for applicants replacing non-school bus heavy-duty vehicles.
• Reduction of Truck Emissions at Port Facilities Grant Program. On April 24, the U.S. Department of Transportation announced $148 million in grants to eleven states and Puerto Rico under the Reduction of Truck Emissions at Port Facilities Grant Program. Established by the 2021 Bipartisan Infrastructure Law, the program aims to reduce pollution from idling trucks and upgrade port infrastructure to improve air quality at ports and surrounding communities.
• SuperTruck Charge Program. OnApril 24, DOE issued a notice of intent to fund demonstration research, development, and demonstration projects for delivering charging infrastructure and grid integration of charging installations for medium- and heavy-duty electric vehicles. Through the program, DOE will invest $72 million in qualifying projects, with a formal funding opportunity announcement expected in June 2024.

Looking Ahead

As has been the case with prior rules issued by EPA and other federal agencies related to reporting and controlling GHG emissions, these final rules may face legal challenges from regulated industries. Still, the timing of these final rules insulates them from being overturned through the Congressional Review Act (CRA) if control of Congress and the White House changes as a result of the 2024 elections. Under the CRA, a new Congress can overturn rules issued by the Executive Branch within 60 legislative days before the prior Congress adjourns by adopting a joint resolution of disapproval signed by the President. You can find Covington's analysis of the CRA and its impact on the Biden-Harris Administration's regulatory agenda here.

Covington's Environmental and Energy practices, as well as our unique Carbon Management and Climate Mitigation (CM2) initiative, have extensive experience and capabilities helping clients navigate complex environmental and energy regulatory requirements and understand how to best engage with grant-funding opportunities created by the 2021 Bipartisan Infrastructure Law and 2022 Inflation Reduction Act. Follow Inside Energy & Environment for more updates and analysis of these Earth Week regulatory and grant-funding developments and future government climate action.

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