EPA Sweeps Away Power Plant GHG Rules, Clearing the Path for New Gas Generation

The US Environmental Protection Agency on Sept. 14 finalized the repeal of Biden administration greenhouse gas standards for power plants fueled by fossil fuels. The action removes a regulatory barrier to new gas fired generation as electricity demand rises from data centers, manufacturing and other industries that consume large amounts of energy.

EPA estimates the repeal will generate more than $300 billion in cost savings over 20 years. The estimate places a substantial financial value on eliminating rules that could have increased costs or imposed operating restrictions on power generation projects.

The agency announced the final action at the G20 Energy Ministers’ Meeting in Houston. Alongside the repeal, EPA proposed eliminating the remaining federal greenhouse gas requirements applying to power plants that use fossil fuels.

That proposal reaches beyond the immediate repeal by addressing the regulatory foundation available for future power sector rules. According to the source, it could make it more difficult for later administrations to impose similar climate regulations on the power sector under the Clean Air Act.

EPA Administrator Lee Zeldin said the rollback would enable the development of new generating infrastructure. The decision arrives as developers plan a significant expansion of US gas fired generation to meet growing electricity requirements.

The Edison Electric Institute previously said that “critically needed new natural gas-fired generation” is crucial for providing baseload and peaking power. The institute also identified grid reliability, balancing renewable resources and a stable greenhouse gas regulatory framework as important considerations for investment in new generation.

The scale of the development pipeline illustrates how quickly plans for new gas capacity are expanding. Global Energy Monitor reported in August that US gas fired power capacity under development rose 50% during the first half of 2026, reaching 378 Gw.

Data center growth represents a major component of that planned capacity. Of the 378 Gw under development, 189 Gw was connected with projects intended to serve electricity demand from data centers.

The volume of proposed capacity does not mean every project will ultimately be constructed. Even so, the overall scope indicates significant potential for additional natural gas demand if developers move forward with a substantial portion of the planned generation.

The repeal could improve the outlook for projects that faced higher costs or operating restrictions under the Biden era standards. Removing those requirements also changes the federal regulatory environment confronting companies evaluating investments in new generating capacity.

Natural gas already plays an expanding role in the US electric power sector. Energy Information Administration data show that power sector gas consumption increased 31%, rising from an average of 27.3 bcfd in 2016 to 35.8 bcfd in 2025.

EIA forecasts that US electricity use will reach record levels in both 2026 and 2027. The agency’s outlook attributes part of that growth to data center development and increased manufacturing activity, the same demand forces supporting plans for additional power generation.

Overall US natural gas consumption also is forecast to set records in both years. EIA expects consumption to rise from 91.9 bcfd in 2025 to 92.2 bcfd in 2026, followed by another increase to 94.3 bcfd in 2027.

More gas fired generation would have consequences beyond power plant construction and fuel consumption. It also would create additional demand for gas pipelines and storage, especially where power plants and data centers are developing more quickly than existing pipeline capacity.

The repeal will face resistance from environmental and public health organizations. The Environmental Defense Fund and Earthjustice are among the groups that have vowed to challenge the regulatory rollback in court.