EPA Releases Proposed GHG Emissions Standard for Power Plants

On March 27, 2012, the EPA released its proposed new source performance standard (NSPS) for carbon dioxide (which EPA is calling “carbon pollution” in its press releases) from electric utility generating units. The proposed emissions limitation is an output-based standard of 1,000 pounds of CO₂ per megawatt-hour (lb. CO₂/MWh).  Conventional coal-fired plants currently average about 1,800 lb. CO₂/MWh.  The proposed new standard is based on the performance of natural gas combined cycle (NGCC) technology.
   
In other words, any new stationary source will need to be a natural-gas fired plant, a renewable energy facility, or a coal plant built with some type of carbon-capture (CCS) technology.

EPA does not attempt to mask its intent with this new proposed standard: the elimination of new coal-fired power plants in the U.S. (although EPA does indicate in the proposal that coal-fired power plants may have a limited useful purpose in terms of "promoting energy diversity").   

EPA recognizes that coal-fired power plants will only be able to achieve the 1,000 lb. CO₂/MWh standard by incorporating expensive carbon capture and sequestration (CCS) technology, but speculates that this technology may become more affordable in the future and that sources may be able to secure funding from the federal government for CCS projects. The proposed regulation would allow coal (and pet coke) fired sources to be subject to an 1800 lb. CO₂/MWh standard for the next 10 years, but these sources would then be subject to a 600 lb. CO₂/MWh for the subsequent 20 years (resulting in a 1000 lb. CO₂/MWh average over the 30 year period).

The proposed NSPS would not apply to “transitional sources” – those that have acquired a complete PSD permit prior to March 27, 2012 and that commence construction within 12 months. It also would not apply to existing EGUs whose CO₂ emissions increase as a result of installation of pollution controls for conventional pollutants (such as SCR dampers).

At this point, EPA has only proposed the NSPS for new and modified sources under §111(b). Emissions guidelines for existing sources under §111(d)—which will be converted into performance standards by the states (in a process much like the SIP process)—are referenced in the proposal, but EPA said yesterday in a conference call that it currently has no plans to regulate existing power plants.

The comment period will run 60 days from the date the proposed rule is published in the Federal Register—which has not happened yet. EPA will also hold public hearings on the proposal, the dates, times and locations of which have not yet been announced.

You can read the full text of the proposed rule here.  More on this to come....