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Coal-fired power plants are considered the dirtiest form of power generation, and contribute far more CO2 to the atmosphere than other power generation methods, according to many experts.
The EPA granted a petition by the Sierra Club, the Natural Resources Defense Council and the Environmental Defense Fund to review the Bush administration's rules.
Sierra Club lawyer David Bookbinder said in a statement:
"This decision stops the Bush administration's final, last-minute effort to saddle President Obama with its do-nothing policy on global warming.
"With coal-fired power plants emitting more than 30 percent of our global warming pollution, regulating their carbon dioxide is essential to making real progress in the fight against global warming.
"Today's announcement should cast significant further doubt on the approximately 100 coal-fired power plants that the industry is trying to rush through the permitting process without any limits on carbon dioxide. New coal plants were already a bad bet for investors and ratepayers and today's decisions make them an even bigger gamble."
Coal industry representatives have not responded with a statement as yet, but expect it to be negative.