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Managing Regulatory Mayhem

Issue 6 and Volume 117.

Russell Ray   By Russell Ray, Managing Editor

Navigating the regulatory maze is a dangerous undertaking for power producers nowadays. Developing a sound, cost-effective strategy for compliance has been complicated by layers of new environmental rules and delays in implementation.

One misstep can set a project back by years, costing power producers and their customers millions. New rules governing mercury emissions, cooling technology, wastewater treatment, coal ash management, regional haze, and greenhouse gas emissions pose a formidable challenge for utility executives and power plant managers. Some of these rules have been finalized while others are in the works.

Successful compliance requires a carefully coordinated, catchall strategy that includes a calculated integration of technologies. Balance is the goal.

A comprehensive plan that achieves the new environmental standards and ensures reliable and affordable electricity is the end-game. But getting there will be different for every power producer and every plant.

The maze of environmental rules is becoming more difficult to navigate. There are a number of new environmental rules awaiting final action or implementation. These rules, which will cost the industry billions in compliance costs, will dictate the future of power generation in the U.S. for decades to come. It is very important these rules be as flexible as possible.

The U.S. Environmental Protection Agency is expected to move forward on several rulemakings that are sure to have a significant impact on electric utilities. Here are three of those forthcoming rules:

  • A final rule governing cooling water intake structures at existing power plants is expected to be issued this month. The rule, which targets plants using once-through cooling systems, would require many facilities to install closed-cycle cooling systems. Closed-cycle systems use less water from rivers and bays and harm fewer fish. Under the rule, plants that draw more than 2 million gallons a day and use at least 25 percent of that water for cooling are required to take action to protect the aquatic environment. More than 670 U.S. plants will be affected by the new rule. The measure will require some power producers to modify cooling water intake structures or construct new cooling towers.
  • The EPA is expected to issue a rule expanding the oversight of coal ash management and disposal at U.S. power plants. The rule would require coal-fired power plants to eliminate wet ash handling and phase out surface impoundments, or ponds, within five years. The rule was proposed after a 40-acre coal ash storage pond at Tennessee Valley Authority’s Kingston plant in Harriman, Tenn., failed in 2008, spilling more than 1 billion gallons of coal ash slurry. The big question is this: Will the EPA classify coal ash as a hazardous or non-hazardous waste? The difference is significant. A hazardous classification would cost power producers billions more in compliance costs.
  • In April, the EPA proposed effluent limitation guidelines to reduce wastewater discharges from power plants. The rule is expected to be finalized by May 2014. The rule would be the first update of the effluent limitations guidelines since 1982. The EPA proposed the rule after the agency found that the increased use of air pollution controls was increasing pollution in wastewater discharges. The rule would reduce pollutants from the following wastewater streams: flue gas desulfurization, fly ash, bottom ash, flue gas mercury control, landfills and surface impoundments, nonchemical metal cleaning wastes, and fuel gasification.

You may have noticed a commonality in all of these measures. All three rules call for significantly stricter standards for water usage in power plants. The change in the EPA’s focus is clear. After decades of advancing clean-air regulations, the agency plans to put a higher priority on new water rules for power producers. At POWER-GEN International 2013 in Orlando, Fla., all of these rules and their impacts will be thoroughly examined by experts participating in several conference sessions. To register online, visit www.power-gen.com. If you have a question or a comment, please contact me at [email protected].

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