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Clean Air Transport Rule: What’s a State To Do?

By lmorris
Sept. 10, 2010-

During a webcast on Sept. 10, EPA directors spoke on the topic of “Urgent CAIR: EPA's New Clean Air Transport Rule.” Sam Napolitano, director of EPA’s clean air markets division, said the transport rule, which is slated to take effect in 2012, will replace the Clean Air Interstate Rule (CAIR). The transport rule, signed on July 6, 2010, includes CAIR requirements, but also achieves emissions reductions concerning the transport of air pollution across state boundaries that are beyond those included in CAIR.

The EPA is proposing one approach and taking comments on two alternatives. All three approaches would cover and set a pollution limit for 31 states and the District of Columbia that have unacceptable SO2 and/or NOx levels according to the EPA. (Click here to see a map of the states affected ). The first approach – which is EPA’s preferred approach – allows intrastate trading and limited interstate trading among power plants but requires each state to meet its own emissions control obligations. The second approach allows for trading among power plants within a state. And in the third approach, EPA specifies the allowable emission limit for each power plant and allows some averaging of emission rates.

EPA estimates compliance costs for the industry will be 2.8 billion in 2014. Most of these costs are projected to be spent on scrubbers (Flue Gas Desulfurization (FGD)) and Selective Catalytic Reduction (SCR) units, and the operation and implementation of all such controls.

To meet the proposed rule, EPA anticipates power plants will operate previously installed control equipment more frequently, use lower sulfur coal, or install pollution control equipment such as low NOX burners, SCR or FGD.

Some individuals in the power industry have raised concerns that the proposed switch to low sulfur coal could be EPA’s disguised advance toward increased natural gas dependence.

During the webinar, Napolitano addressed EPA’s intentions regarding the switch. “Mainly it is coal-fuel switching, not gas. It is only a 1 percent change in coal production.” Napoloitano said EPA’s goal is to have all power plants operating as cleanly as possible in the long run, adding that EPA estimates that in terms of size, 1.2 GW of power plants will be shut down as a result of the transport rule.

To assure rapid compliance with the new emissions control standards, EPA is proposing federal implementation plans (FIPs), for each of the states covered by this rule. A state may choose to develop its own plan to reach the required reductions, replacing its federal plan, and may select which types of sources to control. The Clean Air Act requires states to submit plans to cut down on interstate pollution transport before they submit plans to meet ambient air quality standards. By determining the amount of emissions that upwind states must eliminate in advance of the time that state pollution transport plans are due, EPA plans to enact timely reductions in pollution transport. When downwind states design their plans to meet the air quality standards, they will know how much upwind state control is required. This plan is intended to enable the Clean Air Act to work as planned, helping downwind states to attain standards sooner.

The state budgets for SO2, annual NOX, and ozone season NOX are directly linked to the measurement of each state’s significant contribution and interference with maintenance. EPA’s remedy includes provisions to ensure that all necessary reductions occur in each individual state. EPA poses to allow within-state trading and limited interstate trading to assure that, in each state, the emissions that contribute the most to downwind air quality problems will be eliminated.

CAIR will remain in place until this rule is finalized. The final air transport rule is expected in late spring 2011. More information on the proposed rules and details on how to comment on the proposal are available at http://www.epa.gov/airtransport .
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