Post on 25-Dec-2015
Reducing Pollution from Power Plants
Joe BrysonUS EPA Office of Air and Radiation
November 16, 2010
National Association of State Utility Consumer AdvocatesAnnual MeetingAtlanta, Georgia
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Topics
• Background– Power sector emissions and sources
– Health impacts
– Costs and benefits of reducing emissions
– Characteristics of remaining uncontrolled sources
• Overview of EPA’s forthcoming power sector rules– Detail on Transport Rule 1 & 2 and Utility MACT
• Managing impacts on power sector• Summary• For more information• Appendix
– Additional detail on power sector regulations
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The US Power Sector and Air Pollution
• Much of EPA’s clean air agenda over the past decade was declared inconsistent with the Clean Air Act, and so EPA must revisit those regulations.
• EPA now must promulgate a series of regulations that will require that the electricity generating industry become much cleaner.
• These rules will require decisions by power plant owners and state utility commissions:– For example, whether to make large investments in emissions
controls for existing facilities or choose alternative cleaner resource options (e.g. new generation, demand response, energy efficiency).
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NOX and SO2 Emissions Affect the Health of Millions of Americans and Our Environment
• Health impacts– NOX contributes to the formation of PM2.5 and ground-level ozone.
– SO2 contributes to the formation of PM2.5.
– PM2.5 has been linked to premature death, serious illnesses such as chronic bronchitis and heart attacks, and respiratory problems.
– Ozone has been linked to premature mortality, lung damage, respiratory symptoms, aggravation of asthma and other respiratory conditions.
• Environmental impacts– Sulfur deposition acidifies surface waters, and damages forest ecosystems
and soils.– Nitrogen deposition acidifies surface waters, damages forest ecosystems and
soils, and contributes to coastal eutrophication.
– SO2 and NOX impair visibility, including at national parks and wilderness areas.
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Toxic Pollutants and Greenhouse Gases also Raise Health and Environmental Concerns
• Hazardous air pollutants emitted by power plants include mercury, non-mercury metallic HAPS, acid gases, dioxin/furans, non-dioxin organics, and radionuclides.
• Mercury risks include:• Main exposure to people in U.S. comes from eating fish and other marine species
containing methyl mercury. This form of mercury can impair neurological development in fetuses, infants and children and may cause heart disease in adults.
• Methylmercury accumulates in fish at levels that may harm the fish and other animals that eat them, including birds and mammals and their predators.
• Other HAPs are human carcinogens (arsenic) and probable human carcinogens (lead, cadmium, nickel and dioxin/furans). HAPs also have other health and environmental effects.
• EPA has determined, based on numerous current and anticipated impacts, that CO2 and other greenhouse gases endanger public health and welfare.
77Sources: SO2 and NOx - NEI Trends Data and NEI 2005 Version 2 (2009) and CAMD Data & Maps (2010); PM10 - NEI Trends Data (2009); Hg - NEI 2005 Version 2 (2009); CO2 - Inventory of U.S. GHG Emissions and Sinks: 1990-2008 (2010) and 1990-2007; “Other” sources include transportation, other mobile sources, and industrial sources
Other Sectors
Nitrogen Oxides (NOx), 200915.3 Million Tons
Particulate Matter (PM10), 200514.8 Million Tons
Mercury (Hg), 2005114 Tons
Other Sectors
13.3 Million Tons 87%
2.0 Million Tons 13%
Electric Power
Other Sectors
14.3 Million Tons 96%
Electric Power
Other Sectors
Electric Power
2.6 Billion Tons 40%
62 Tons 54%
52 Tons 46%
Sulfur Dioxide (SO2), 20099.5 Million Tons
3.8 Million Tons 40%
5.7 Million Tons 60%
Electric Power
Carbon Dioxide (CO2), 20086.5 Billion Tons
3.9 Billion Tons 60%
0.5 Million Tons 4%
Other Sectors
Electric Power
Power Sector: A Major Share of US Air Emissions
Coal 85%
Coal 97%
Coal 83%
Coal >99%
Coal-fired power plants: vast majority of power sector air emissions
Coal 95%
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Benefits of Reducing Power Sector Emissions Will Far Exceed Costs
• We cannot predict the costs – or the benefits - with certainty before we have established the regulations themselves.
• Achieving a much cleaner power industry will impose costs to the industry and to ratepayers.
• The value of the benefits to the public will be much greater than the costs. – Benefits include prevented illness and death as well as ecological
benefits.
– Expect that the sum of these regulations will prevent thousands of premature deaths, and hundreds of thousands of episodes of respiratory illness each year.
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* Impacts avoided due to improvements in PM2.5 and ozone air quality in 2014
Estimated Number of Adverse Health Effects Avoided Due to Implementing the Proposed Transport Rule*
Health Benefits for Millions of AmericansBenefits Greatly Exceed Costs
Health Effect Number of Cases Avoided
Premature mortality 14,000 to 36,000
Non-fatal heart attacks 23,000
Hospital and emergency department visits 26,000
Acute bronchitis 21,000
Upper and lower respiratory symptoms 440,000
Aggravated asthma 240,000
Days when people miss work or school 1.9 million
Days when people must restrict activities 11 million
• EPA estimates the annual benefits from the proposed transport rule range between $120-$290 B (2006 $) in 2014 with annual compliance costs of $2.8 billion in 2014.• EPA estimates 2014 prices for electricity, natural gas, and coal prices increase 1 to 2%.
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Billions of Dollars of Health Benefits in 2014
Maine, New Hampshire, Vermont, Rhode Island, North and South Dakota receive benefits and are not in the Transport Rule region. Transport Rule RIA, Table A-4 and A-5; mortality impacts estimated using Laden et al. (2006), Levy et al. (2005), Pope et al. (2002) and Bell et al. (2004); monetized benefits discounted at 3%
Ranges of Benefits
Proposed Transport Rule
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Public Health Protection Delayed• The American public has suffered avoidable deaths and illnesses as
important Clean Air Act-required power plant controls have been delayed more than a decade.
• The Act required states by 2000 to adopt rules as needed to control interstate pollution to help meet health-based air quality standards issued in 1997
– NOX SIP Call Rule (1998) partially addressed ozone transport by 2004, but did not address fine particles.
– Previous Administration finalized Clean Air Interstate Rule (CAIR) in 2005 but court found legal flaws and ordered EPA to replace it. CAIR remains in place in the interim.
– New Transport Rule to replace CAIR and address 2006 PM NAAQS is to be completed in June 2011.
• The Act required studies in the early 1990s and, if appropriate and necessary, control of hazardous air pollutants from power plants.
– Positive determination in 2000 meant final rule due by 2002.– Previous Administration issued Clean Air Mercury Rule for power plants in 2005
but court found rule legally flawed and vacated it in 2008. Also, rule failed to address all air toxics.
– Consent decree requires EPA to propose rule to control toxic air pollutants from EGUs by March 2011 and finalize by November 2011.
14Data Sources: 2007/2008 EPA IPM, ARP, NBP Databases & Commercial Sources, MJB&A Analysis
Out of 300+ GW of existing coal capacity, roughly 100 GW will remain unscrubbed(after installation of currently planned retrofits)
Unit Age
Units CapacityAvg. Unit
Size (MW)
Pollution Control Installed (% of units)
Count % MW % SNCR SCR Scrubber Uncontrolled
> 60 years 46 5% 1,762 1% 38 2% 4% 11% 87%
51 - 60 years 313 31% 39,787 13% 127 21% 9% 19% 64%
41 - 50 years 233 23% 58,078 20% 249 15% 19% 33% 53%
31 - 40 years 229 23% 114,090 38% 498 4% 43% 65% 27%
11 - 30 years 163 16% 80,165 27% 492 6% 29% 66% 31%
10 years or younger 7 1% 2,444 1% 349 43% 29% 57% 29%
Total 1,004 297,639 13% 23% 41% 48%
Many Coal Plants Remain Uncontrolled for SO2 &/or NOXMany are > 40 years old
Many are < 250 MW
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Upcoming CAA Power Plant Rules
• Interstate Pollution Transport Rule (#1) for existing PM and ozone NAAQS– Proposed rule unveiled in July, published August 2, 2010– Final rule planned June 2011
• Transport Rule (#2) for 2010 reconsidered ozone NAAQS– Proposed rule in 2011, final rule in 2012
• Utility MACT (section 112/hazardous air pollutants)– Propose March 2011, finalize November 2011
• Utility NSPS (section 111/criteria pollutants)– Propose March 2011, finalize November 2011 (i.e., same schedule as MACT)– 2006 utility NSPS is under reconsideration and subject to pending litigation– Section 111(b) for new and modified/reconstructed sources
• Response to court remand on Utility NSPS (section 111) for GHGs– EPA is considering substance and timing of its response.
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• EPA is proposing one approach and taking comment on two alternatives. – All three approaches would cover the same states – 31 states and the District
of Columbia, set a pollution limit (or budget) for each state and obtain the reductions from power plants.
• EPA’s preferred approach – allows intrastate trading and limited interstate trading among power plants but assures that each state will meet its pollution control obligations.
• To meet this proposed rule, EPA anticipates power plants will:– Operate already installed control equipment more frequently, – Use lower sulfur coal, or– Install pollution control equipment such as low NOX burners, Selective Catalytic
Reduction (SCR), or SO2 scrubbers (Flue Gas Desulfurization).
• CAIR remains in place until this rule is finalized.
• Final rule is expected in late spring 2011.
Transport Rule
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Transport Rule
• In 2012, EPA projects that:• Some communities will still not meet the air
quality standards.• Millions of people will continue to breathe
unhealthy air.• Many upwind states will still contribute
significantly to downwind nonattainment areas.
• The Transport Rule will affect power plants because their emission reductions are most cost-effective.
• Other actions by EPA and the states must be taken before all areas will attain the current and future National Ambient Air Quality Standards (NAAQS).
Counties with Violating PM and/or Ozone Monitors (55)Counties with PM and/or Ozone Maintenance Problems (28)
States covered by the Transport Rule (31 + DC)
Counties with Monitors Projected to Have Ozone and/or PM2.5 Air Quality Problems in 2012 Without the Proposed Transport Rule
This analysis assumes that the Clean Air Interstate Rule is not in effect. It does reflect other federal and state requirements to reduce emissions contributing to ozone and fine particle pollution that were in place as of February 2009.
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Four Separate Control Regions
• Proposal includes separate requirements for:
• Annual NOx reductions (2012)
• Ozone-season NOx reductions (2012)
• Sets emissions budgets for each state
• Proposal includes separate requirements for:
• Annual SO2 reductions
• Phase I (2012) and Phase II (2014)• Two Control Groups
• Group 1 – 2012 cap lowers in 2014• Group 2 – 2012 cap only
• Sets emissions budgets for each state
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Transport Rule 2
• Will address CAA responsibility of upwind states to downwind state ozone problems– Emissions reductions needed for all states in the nation
contributing to nonattainment/interfering with maintenance of upcoming 2010 ozone standards
– Any emissions reductions needed for states contributing to nonattainment/interfering with maintenance of 1997 ozone standard in Baton Rouge, Houston, New York City
• Will analyze both EGU and non-EGU sources for available controls
• Transport Rule 1 provides framework for addressing transport under future standards
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Utility MACT: Coal and Oil-Fired Power Plants
• Will likely drive significant investment in upgrading plants with modern pollution control.
• To be proposed March 2011 and finalized November 2011 (per court order)– In response to court vacating (2008) EPA’s “Clean Air Mercury Rule” (2005)
• Will reduce emissions of mercury, other metals such as arsenic and lead, dioxin/furans, acid gases, etc.
• The standard: maximum reduction achievable for sources taking into consideration costs, energy requirements and non-air quality health and environmental impacts.
• Must be at least as stringent as:– Existing sources: the average emissions reduction achieved by the top performing
12 percent of sources within the category– New sources: the emissions reduction achieved by the best single performing
source within the category• Compliance:
– Existing: 3 years from final rule + 1 year allowable extension by State/EPA – New: upon final rule
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Non-CAA Rules Affecting Power Plants(See Appendix)
• Resource Conservation and Recovery Act (RCRA)– Coal Combustion Residuals (CCR)
• Proposed: June 2010
• Clean Water Act (CWA)– Cooling Water Intake Structures (CWIS)
• Currently taking comments on Information Collection Request (ICR)
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• Pollution reduction controls at utilities are well-understood and available now
• SO2 reduction technologies• Reduce HAPs to meet requirements of upcoming Utility MACT• Help in-state areas attain the existing and upcoming PM2.5 NAAQS and 2010 SO2 NAAQS• Help downwind states attain PM2.5 NAAQS • Address visibility (regional haze) improvement goals
• NOx reduction technologies• Help in-state areas attain the existing and new ozone NAAQS• Help downwind states attain the existing and new ozone NAAQS• Address visibility (regional haze) improvement goals
• Mercury reduction technologies• Reduce mercury emissions to meet requirements of upcoming Utility MACT
• Direct PM reduction technologies:• Help attain PM2.5 NAAQS and visibility program requirements• Reduce HAP emissions to meet requirements of upcoming Utility MACT
Toolbox of Emissions Reduction Technologies for Power PlantsMany Have Multi-pollutant Benefits
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Cumulative SCR and FGD Installations by Year
05,000
10,000
15,00020,00025,00030,000
35,00040,000
19
99
20
01
20
03
20
05
20
07
20
09
20
11
Year
Ca
pa
cit
y (
MW
)
SCR FGD(wet/dry)
Source: David C. Foerter, Executive DirectorInstitute of Clean Air Companies (ICAC), October 22, 2010
Industry Capacity to Add New Emissions ControlsAdded 20+ GW of SO2 scrubbers per year 2008 - 2010
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-
10,000
20,000
30,000
40,000
50,000
60,000
70,000
80,000
1940 1945 1950 1955 1960 1965 1970 1975 1980 1985 1990 1995 2000 2005
RenewableHydroNuclearOtherOilGasCoal
Capacity (MW)
Industry Capacity to Add New GenerationBetween 2001 and 2003 the electric industry built over 160 GW of new generation
Source: Ceres, et al., Benchmarking Air Emissions of the 100 Largest Electric Power Producers in the United States, June 2010.
U.S. Power Plant Capacity Added By In-service Year
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The Role of Energy Efficiency & Demand Response
• Multiple benefits of supplementing our rules with actions to reduce electricity demand by increasing use of EE and DR– Reduce costs to power sector of controlling conventional pollutants– Avoid or defer need for new generation– Reduce conventional air pollutant emissions, including on high
electricity demand days (which coincide with poor air quality)– Reduce concerns about reliability of electricity supply– Lower consumer bills – Achieve reductions in CO2 through idling or retirement of inefficient
fossil-fuel-fired generating stations that would no longer be economic
• EPA can encourage but cannot mandate or fund energy efficiency in residential or commercial sectors. We encourage state regulators, system operators, and utilities to take action to cost-effectively reduce demand for electricity.
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LBNL forecasts a 250% to 400% increase (Med/High cases) in EE program funding by 2020
Cumulative savings by 2020 equal 6.1% (med) to 8.6% (high).of EIA’s forecast 2020 electricity demand
Source: LBNL’s The Shifting Landscape of Ratepayer-Funded Energy Efficiency in the U.S. (October, 2009) by Galen Barbose, Charles Goldman, and Jeff Schlegel
Energy Efficiency Program Funding and Electricity Savings Projected to Grow Substantially
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National Demand Response Potential
650
700
750
800
850
900
950
1,000
2009 2011 2013 2015 2017 2019
GW
38 GW,4%
82 GW,9%
138 GW,14%
188 GW,20%
BAU 1.7%
Expanded BAU1.3%
FullParticipation
0.0%
AchievableParticipation
0.6%
No DR (NERC)
1.7%
Change in peak demand from No DR scenario
Average Annual Growth Rate
(AAGR)
BAU: Business-as-UsualDR: Demand Response
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Role for State Utility Commissions, Generation Owners, Utilities and Other Stakeholders
• EPA is now promulgating a series of regulations that will require that the electricity generating industry become much cleaner.
• These rules will require decisions by power plant owners, utilities, state utility commissions and other stakeholders
– For example, whether to make large investments in emissions controls for existing facilities or choose alternative cleaner resource options (e.g. new generation, demand response, energy efficiency).
• These entities have tools and processes to manage these and other uncertainties to ensure reliable electricity service at reasonable rates
– Other significant uncertainties include fuel prices; construction costs for new generation; potential federal legislation addressing RES, GHGs, Transmission, and tax policies; pace of economic recovery and impacts on load growth; and the scale, pace, and impacts of Smart Grid investments.
• Like all uncertainty that utilities and state commissions face, good information is necessary to make informed decisions which best account for and manage risk appropriately
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Key Points• Cutting power plant pollution is required by the Clean Air Act and essential to protecting
public health. Power plants are among the largest U.S. emitters of air pollutants with serious health effects including premature death.
• Avoidable deaths and illnesses continue to occur because important Clean Air Act-required power plant controls have been delayed more than a decade.
• Courts have determined that key rules issued by EPA over the past decade were inconsistent with the Clean Air Act, which contributed to delays. EPA now must meet legal obligations to issue new rules that will require that the power sector become much cleaner.
• Forty years of experience under national environmental laws shows that we can pursue a clean, healthy environment while maintaining economic growth and reliable electricity.
• Improved efficiency in electricity use can cut air pollution control costs, help ensure reliability of electricity supply, and reduce emissions of GHGs and other air pollutants.
• EPA has been considering reliability as it develops these new rules, and will continue to do so. EPA, FERC, DOE and state utility regulators, both together and separately, have tools at their disposal to ensure the continued reliability of our electricity supply.
• NASUCA members play a key role through engagement with state utility commissions
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For More Information• Clean Air Act (CAA)
– Transport Rulehttp://www.epa.gov/airtransport
– Utility MACThttp://www.epa.gov/ttn/atw/utility/utilitypg.html
– Utility NSPShttp://yosemite.epa.gov/opei/rulegate.nsf/byRIN/2060-AQ37
• Resource Conservation and Recovery Act (RCRA)– Coal Combustion Residuals (CCR)http://www.epa.gov/wastes/nonhaz/industrial/special/fossil/ccr-rule/index.htm
• Clean Water Act (CWA)– Cooling Water Intake Structures (CWIS)http://www.epa.gov/waterscience/316b/
• GHG Permittinghttp://www.epa.gov/nsr/ghgpermitting.html
Joe Brysonbryson.joe@epa.gov
202.343.9631
NARUC Climate Task Force Webcasts on EPA Power Sector Rules
http://www.naruc.org/committees.cfm?c=58#
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APPENDIX
• Additional information for EPA rulemakings– Utility New Source Performance Standards (NSPS)
– §316(b) Cooling Water Intake Structure (CWIS)
– Coal Combustion Residuals (CCR)
• Safeguards for addressing reliability challenges• Announced coal retirements
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Utility New Source Performance Standards
• Clean Air Act, Section 111, New Source Performance Standards (NSPS)– Authority to set emissions performance standard for new and modified sources
(EPA directly), and existing sources (through the states)– Standards must reflect the emission limitation achievable through the application of
the best system of emission reduction which the Administrator determines has been adequately demonstrated. Must consider:
• cost of achieving such reduction • any non-air quality health and environmental impact, and • energy requirements
– Standards are based on demonstrated performance and may not require use of any particular technology.
• NSPS for Utility Boilers (NOx, SO2, PM)– To be proposed with Utility MACT - March 2011 and finalized November 2011
• NSPS for Utility Boilers (GHGs)– Schedule and approach still under deliberation
• NSPSs are to be reviewed at least every 8 years.
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§316(b) Cooling Water Intake Structure (CWIS) Regulation
• Original rule issued in 2004– Portions remanded to EPA by 2nd Circuit– Portions upheld by Supreme Court in Entergy decision
• 1,260 existing facilities collectively withdraw 226 billion gallons of water per day
• Main environmental impacts– Impingement and entrainment– Thermal discharges may also be significant for some waters
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Cooling Water Basics
Larger fish unable to swim away are impingedimpinged against the screen and usually die.Smaller organisms that pass through the screens are entrainedentrained in the cooling system and also die.
Fixed Bar Racks
Traveling Screens
Once through cooling uses water only once as it passes through a condenser to absorb heat and is then discharged.Closed-cycle coolingClosed-cycle cooling reuses water by reuses water by recycling it through recirculating recycling it through recirculating systems or towers.systems or towers.
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Schedule for §316(b) Rule
• Agency’s intent is to issue final rule by July 2012• Also effected through NPDES permits and 5 year cycle
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Proposed Rule for Coal Combustion Residuals The Basics
• Coal Combustion Residuals (CCRs) are byproducts from the combustion of coal – fly ash, bottom ash, boiler slag, and flue gas desulfurization materials.
• Currently (2008) more than 136 million tons generated per year: 34 % (46 million tons) landfilled– 22% (29.4 million tons) disposed of in surface
impoundments– nearly 37% (50.1 million tons) beneficially used– nearly 8% (10.5 million tons) placed in mines– 75 % of impoundments are greater than 25 years old; 10%
greater than 50 years old– Approximately 300 CCR landfills and 584 surface
impoundments in use at approximately 495 coal-fired power plants
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CCRs – The Proposal
• On June 21, 2010, EPA proposed 2 approaches for regulating disposal of CCRs under the Resource Conservation and Recovery Act (RCRA):– Subtitle C approach– Subtitle D approach
• Proposal covers CCRs generated from the combustion of coal at electric utilities and independent power producers.
• Does not cover coal-fired electric plants used captively by industries or universities.
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CCRs – The Proposal
• Engineering requirements (e.g., liners, groundwater monitoring) of the two options are very similar; differences are primarily in enforcement and implementation.
• Bevill exemption from regulation remains in place for beneficial uses of CCRs.
• Minefilling is not covered by the proposal.
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Regulation under Subtitle C
• Listed as a “special waste subject to subtitle C” – S001.
• Subject to existing Subtitle C requirements, e.g., generator, transporter, permitting, ground water monitoring, corrective action, and financial assurance. LDRs and treatment standards apply.– Single composite liner– [5 years for surface impoundments to comply with requirements; no
requirement for annual dredging]– Structural Stability Requirements– Existing landfills must install groundwater monitoring within 1 year of effective
date of rule, but do not need to install composite liners.– New landfills or lateral expansions of existing landfills must install composite
liners and groundwater monitoring before landfill begins operation.– Surface impoundments must meet LDRs and liner requirements within 5 years
of effective date of rule or close within an additional 2 years. • LDR requirements have the practical effect of phasing out surface impoundments
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Regulation under Subtitle D
• CCRs would remain classified as a “non-hazardous” waste.
• National minimum criteria governing facilities disposing of CCRs.
• Many of the engineering requirements are very similar to the Subtitle C option, e.g., groundwater monitoring, liner and structural stability requirements.
• Requirements are self implementing.
• Owner/operator required to:– obtain certifications by independent professional engineers/minimum
qualification requirements for those who make certifications.– document how various standards are met. Must be kept in the operating
record and the State notified.– maintain a web site available to the public that contains the documentation
that the standard is met.
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Key Differences: Subtitle C versus Subtitle D SUBTITLE C SUBTITLE D
Effective Date Timing will vary from state to state, as each state must adopt the rule individually-can take 1 – 2 years or more
Six months after final rule is promulgated for most provisions.
Enforcement State and Federal enforcement Enforcement through citizen suits; States can act as citizens.
Corrective Action Monitored by authorized States and EPA Self-implementing
Financial Assurance Yes Considering subsequent rule using CERCLA 108 (b) Authority
Permit Issuance Federal requirement for permit issuance by States (or EPA)
No
Requirements for Storage, Including Containers, Tanks, and Containment Buildings
Yes No
Surface Impoundments Built Before Rule is Finalized
Remove solids and meet land disposal restrictions; retrofit with a liner within five years of effective date. Would effectively phase out use of existing surface impoundments
Must remove solids and retrofit with a composite liner or cease receiving CCRs within 5 years of effective date and close the unit
Surface Impoundments Built After Rule is Finalized
Must meet Land Disposal Restrictions and liner requirements. Would effectively phase out use of new surface impoundments.
Must install composite liners. No Land Disposal Restrictions
Landfills Built Before Rule is Finalized No liner requirements, but require groundwater monitoring
No liner requirements, but require groundwater monitoring
Landfills Built After Rule is Finalized Liner requirements and groundwater monitoring Liner requirements and groundwater monitoring
Requirements for Closure and Post-Closure Care
Yes; monitored by States and EPA Yes; self-implementing
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Costs of CCR Regulation EPA has estimated regulatory costs and regulatory benefits
(groundwater protection avoided cancer cases, avoided future cleanup costs, increased beneficial use) for the next 50 years.
• Subtitle C (assuming no reduction in beneficial uses):– Cost: up to $1.5 billion / year– Benefit: up to $7.4 billion / year
• Subtitle D (assuming no reduction in beneficial uses):– Cost: up to $587 million / year– Benefit: up to $3 billion / year
• If the full regulatory costs of Subtitle C were passed on from utility companies to consumers, our estimates indicate that electricity prices nationwide could increase by 0.8%, on average.
• For Subtitle D, the potential full cost pass-thru nationwide increase in electricity prices is estimated at 0.2%.
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Providing Relief in Extreme CasesStatutory, Regulatory, and Market Safeguards
Assorted risk management procedures under the Clean Air Act (CAA), Federal Power Act (FPA), and other statutes provide the EPA, DOE, FERC, and the President an array of tools to moderate, when and where necessary, potential impacts on electric system reliability.
AgencySource of Authority / Instrument of Implementation
Measure
Regional Wholesale Electricity Markets (e.g: PJM, ISO-NE, etc.)
Enforcement of Market Rules, Reliability-Must-Run (RMR) agreements, Forward Capacity Markets, etc.
RMR agreements allow units to operate only to ensure reliability while minimizing adverse environmental impacts.
Forward capacity markets provide a mechanism to signal the need for new capacity additions
State Public Utility Commissions Regulatory oversight of utilities Adopt ratemaking policies that encourage system reliability and environmental goals including ones that address utilities’ financial disincentives where EE and DR programs lower utility revenues.
U.S. Department of Energy Section 202(c) of the Federal Power Act Override CAA-derived control requirements in limited emergency circumstances
U.S. Environmental Protection Agency Cap-and-trade based regulations
Section 112(i)(3)(B) of the CAA
Emissions trading mechanisms enable greater compliance flexibility to manage potential reliability concerns
Extend deadlines for utility MACT rule where necessary to maintain electric system reliability
U.S. PresidentSection 112(i)(4) of the CAA Extend deadlines for utility MACT rule where
necessary to maintain electric system reliability