The Clean Power Plan presents the states with a complex set of
choices to reduce CO2 emissions from their electricity sectors.
States must decide what form of target to adopt, the role of
market-based emission credits or allowances, and the desired range
of interstate trading opportunities. States making these choices
will try to satisfy multiple objectives and respond to a broad
range of stakeholder opinion on the best path forward. This paper
introduces some of the tradeoffs and analyses that states and
stakeholders should consider in selecting an implementation and
compliance system to attain the ambitious goals of the Clean Power
Plan.
In August 2015, the Environmental Protection Agency (EPA)
finalized its carbon dioxide (CO2) emission standards for existing
power plants under Section 111(d) of the Clean Air Act, a rule
commonly known as the Clean Power Plan (CPP). At the same time, the
EPA provided a blueprint for moving forward by defining tradable
compliance
