Policy & Regulations

Federal Environmental Regulations and the Power Sector

Issue 10 and Volume 119.

Joe Rubino, Principal Scientist, Stanley Consultants, Inc.

Over the past three years, the utility industry has become subject to numerous environmental regulations targeting the reduction of pollutants in air and solid waste media. These regulations are forcing utilities to perform detailed reviews of their existing assets to determine if units would require retrofit controls, fuel conversion, or retirement to maintain compliance.

Utility Mercury & Air Toxics Standards

In April 2013, the Utility Mercury & Air Toxics Standards (UMATS) regulation was finalized by the Environmental Protection Agency (EPA). The UMATS regulation reduces mercury and hazardous air pollutants from power plants that combust coal and/or oil. An electric utility steam generating unit (EGU) subject to UMATS is a coal and/or oil-fired combustion unit of more than 25 MWe that serves a generator that produces electricity for sale.

Emission standards for EGUs are based primarily on the type of fuel combusted and whether the unit is new/reconstructed or existing. The emission standards for coal-fired EGUs are further separated by whether the unit is designed for low rank virgin coal. UMATS limits filterable particulate matter or total non-Hg HAP metals or individual HAP metals; hydrogen chloride or sulfur dioxide; mercury; and hydrogen fluoride (oil-fired units only).

In June, the Supreme Court sent the UMATS regulation to the D.C. Circuit Court for reconsideration citing that EPA failed to consider costs in determining whether or not to regulate hazardous air pollutants from power plants under Section 112 of the Clean Air Act. The D.C. Circuit Court could vacate the regulation or uphold it, depending on whether or not EPA is able to offer a reasonable explanation for excluding costs. However, since the rule was not stayed during judicial review, the regulation is still in effect, and many utilities have already had to make decisions and execute plans for existing units.

CCR Rule

The Coal Combustion Residuals (CCR) final rule was published this April. The rule establishes new national criteria under Subtitle D of the Resource Conservation and Recovery Act (RCRA) for the disposal of CCRs for the electric utility industry. The rule relies on self-implementation and has an effective date of October 14, 2015. The time period for implementing the rule, in general, ranges from 6 months to 3.5 years from the publication date.

Requirements for existing surface impoundments and landfills (including lateral expansions) include groundwater monitoring, corrective action, operating criteria, closure and post-closure care, recordkeeping, notifications, and public internet sites. Lateral expansions of existing landfills must also meet design criteria regarding composite liners and leachate collection and removal systems.

There are several components of the groundwater monitoring program. The facility must have an up-gradient and down-gradient monitoring well network. Collection and statistical evaluation of eight quarters of groundwater data are required to establish background groundwater concentrations. Once the background levels are established, the facility begins to conduct detection monitoring. If a groundwater constituent is detected at a statistically significant increase at levels above the established background levels, the facility must initiate assessment monitoring.

Clean Power Plan

The final rule of the Clean Power Plan (CPP) provides guidelines for states to achieve state-specific, rate-based, and mass-based goals for carbon dioxide (CO2) emissions from existing EGUs that commenced construction on or before January 8, 2014. EPA set emission rate-based CO2 goals in pounds of CO2 per net MWh, and mass-based goals in pounds of CO2 for each state. Interim goals have been defined for three periods spanning 2022 through 2029. States must meet interim goals until 2030, when their final goal takes effect.

The rule allows states to tailor their plans based on their own energy, environmental, and economic needs and goals. States will have the option of working with other neighboring states to create an equivalent multi-state performance goal. The rule allows states to accomplish reductions in CO2 emissions from a combination of EGU efficiency improvements, replacement of affected units with lower-emitting or zero-emitting units such as renewables, and re-dispatch of lower-emitting units. EPA also allows states to reduce electricity demand using demand-side efficiency improvements.

An intense period of regulatory action will continue this fall as EPA is poised to finalize new ozone regulations via the National Ambient Air Quality Standard (NAAQS). Given the magnitude and scope of these environmental mandates, environmental compliance efforts will remain at the forefront for utilities as they try to deliver cost-effective and reliable power to the public.