In June 2025, the EPA proposed repealing federal standards that limit carbon dioxide emissions from fossil fuel-fired power plants. These Carbon Pollution Standards (CPS) were designed to ensure that the most frequently used power plants reduce their climate impact through adequately demonstrated technologies like carbon capture and hydrogen blending.
The proposed repeal hinges on a critical question: do emissions from U.S. power plants contribute “significantly” to the problem of climate change? To most scientists, economists and policymakers, the answer is an unequivocal “yes.”
In its proposed repeal, EPA suggests that the U.S. power sector’s current 3 percent contribution of total greenhouse gas emissions “may not be a significant contribution to the GHG concentrations in the atmosphere.” The main rationale EPA offers for its judgment is that U.S. power sector emissions made up 5.5 percent of total global greenhouse gas emissions in 2005 and in 2022 comprised 3 percent of total global greenhouse gas emissions. EPA provides no evidence for its argument, which seems to rest solely on the observation that 3 is smaller than 5.5 and much smaller than 100. For context, 3 percent of U.S. GDP is $870 billion, hardly an insignificant dollar amount.
Notably, while U.S. power sector emissions have fallen 36 percent (2005 – 2022), global emissions have grown by 30 percent over the same period. Therefore, 45 percent of the “decline” in U.S. power sector emissions relative to total global greenhouse gas emissions is due to the fact that global emissions have increased by 13.2 billion metric tons per year since 2005.
Far from insignificant, the numbers are massive
In 2024, the U.S. power sector emitted 1,427 million metric tons of carbon dioxide, the second largest U.S. source by sector. This amount exceeds the combined economywide emissions of Germany, France, and the United Kingdom. Indeed, if the U.S. power sector were its own country, it would be the sixth largest emitter of carbon pollution in the world, after only China, the rest of the U.S., India, the European Union, and Russia.
Moreover, other sectors with smaller global shares—like aviation (1.6 percent), international shipping (1.9 percent), and aluminum production (1.9 percent)—are widely acknowledged as significant sources of climate pollution, with international efforts underway to reduce their emissions. Suggesting that 3 percent isn’t significant enough to warrant regulation sets a dangerously low bar. If we followed this logic, nearly every country and sector in the world would be excused from climate action. Climate change is a collective problem. Every meaningful source must be addressed—especially one as large and controllable as the U.S. power sector.
The economic case: pollution isn’t free
There’s also a compelling economic argument for keeping strong carbon standards in place. Every ton of carbon dioxide emitted into the atmosphere contributes to the rising costs of climate change—from damaged infrastructure and lost agricultural productivity to increased healthcare costs and disaster recovery.
Economists use a measure called the Social Cost of Carbon (SCC) to quantify these damages. The latest estimate from leading experts puts the central value of the SCC at around $190 per ton of carbon dioxide.
Using that value, the 1.4 billion tons of carbon dioxide emitted by the U.S. power sector in 2024 would result in more than $271 billion in annual economic damage. Even using a much lower SCC value of just $1 per ton—a figure used by the first Trump administration—the damages still exceed $1.4 billion per year. That’s seven times the threshold the federal government (i.e., Office of Information and Regulatory Affairs) uses to define a regulation as “economically significant.”
According to the EPA’s own analysis, repealing the standards would increase annual emissions by 123 million tons in 2035. That translates to $23 billion in additional damages every year if the repeal goes forward.
Over the past five decades, the U.S. power sector has released nearly 96 billion tons of carbon dioxide into the atmosphere, much of which remains in the atmosphere today and is a significant contributor to climate and health impacts (e.g., more frequent and intense heatwaves, droughts, floods, wildfires, ecosystem disruption, sea level rise, ocean acidification, heat-related morbidity and mortality) that we are currently experiencing.
Continued emission declines aren’t guaranteed
Even with the welcome growth of clean electricity sources like wind and solar, today, more than 60 percent of U.S. electricity still comes from natural gas- and coal-fired power plants. And while emissions have declined in recent years due to coal plant retirements and a shift toward more natural gas and renewables, this trend is not guaranteed to continue. In fact, it may be reversing.
For the first time in decades, electricity demand in the United States is rising. New data center growth driven by the rapid expansion of artificial intelligence, a manufacturing resurgence, and a growing number of electric vehicles are all pushing consumption higher. Experts project a 15–25 percent increase in electricity demand by 2030, and possibly 50–80 percent by mid-century.
Solar power is being deployed at record levels, and mothballed nuclear power plants are being restarted on the positive side; however, increasing electricity demand is also putting pressure on utilities to keep older fossil fuel plants online longer and even build new ones. More than 4 gigawatts (GW) of new natural gas plants are under construction, with another 14 GW planned by 2028. A slate of coal plant retirements are being reconsidered, and in many cases are being postponed for years in light of growing demand. Without enforceable carbon standards, we risk a long-term increase in emissions just when we should be doing everything possible to reduce them.
U.S. leadership matters—at home and abroad
The United States has long been a global leader in energy innovation and environmental policy. Walking further away from that leadership now would send the wrong signal at a time when the rest of the world is watching—and many countries are stepping up their own climate ambitions.
Strong domestic standards also help U.S. companies remain competitive in global markets. As more countries implement border carbon adjustments (BCAs)—tariffs on goods from countries with weaker climate policies—American industries could face trade disadvantages if our emissions rise. Since the industrial sector is the largest user of electricity, a higher carbon intensity in our power sector could make U.S. goods less attractive abroad in the long run. Conversely, a clean, reliable, and well-regulated power sector gives American businesses an edge—especially as the world pivots toward low-carbon technologies.
Investors need predictability, not whiplash
Energy infrastructure isn’t built overnight. Power plants cost hundreds of millions of dollars and operate for decades. Investors need clear, consistent policies to plan for the future. Repealing carbon standards creates uncertainty, raises risks, and undermines confidence in long-term investments in clean power. As C2ES notes, balanced regulations are not only essential for cutting emissions—they’re also vital for ensuring regulatory stability, market confidence, and energy sector resilience.
A time to lead, not retreat
EPA’s proposed repeal of the Carbon Pollution Standards is out of step with science, economics, and global trends.
The impacts of climate change are already costing Americans dearly. The tools to reduce emissions are available. And the responsibility—and opportunity—for the United States to lead has never been clearer.
Reasonable, practical, and forward-looking policies are how we protect public health, preserve our economic edge, and ensure a sustainable energy future. That means strengthening our carbon standards—not dismantling them.
