The U.S. Environmental Protection Agency on April 25 finalized four rules affecting the power sector.
The four rules EPA finalized are:
- Greenhouse Gas Emission Guidelines for Existing Coal-Fired Power Plants and New Source Performance Standards for Stationary Combustion Turbines;
- Mercury and Air Toxic Standards Residual Risk and Technology Review
- Steam Electric Effluent Limitation Guidelines; and
- Coal Combustion Residual Legacy Impoundment and CCR Management Units
Final GHG Rule
The final rule includes subcategories “that recognize the fact that the longer running and more heavily utilized a power plant is, the more cost-effective it is to install controls for CO2 emissions,” EPA said.
For new combustion turbines, the final rule establishes three subcategories based on how intensively they are operated.
- New base load turbines (defined as units that are generating at least 40% of their maximum annual capacity, i.e., greater than 40% capacity factor) are subject to an initial "phase one" standard based on efficient design and operation of combined cycle turbines; and a "phase two" standard based on 90% capture of CO2 with a compliance deadline of Jan. 1, 2032.
- New intermediate load turbines (defined as units that are generating between 20 and 40% of their maximum annual capacity, i.e., 20-40% capacity factor) are subject to a standard based on efficient design and operation of simple cycle turbines.
- New low load turbines (defined as units that are generating less than 20% of their maximum annual capacity, i.e., less than 20% capacity factor) are subject to a standard based on low-emitting fuel.
For existing coal-fired EGUs, the final rule establishes subcategories based on how far into the future the plant intends to operate.
- Units that intend to operate on or after January 1, 2039 (i.e., “long-term” units) will have a numeric emission rate limit based on application of CCS with 90% capture, which they must meet on January 1, 2032.
- Units that have committed to cease operations by January 1, 2039 (i.e., “medium-term” units) will have a numeric emission rate limit based on 40% natural gas co-firing that they must meet on January 1, 2030.
- Units that demonstrate that they plan to permanently cease operation prior to January 1, 2032, will have no emission reduction obligations under the rule.
- For existing units, states have the ability to provide a variance for individual sources based on consideration of remaining useful life and other factors. An alternative standard may be appropriate where an individual existing source has fundamentally different circumstances than those considered by EPA and the source cannot reasonably achieve this required degree of emission limitation.
State Submission of Plans for Establishing Standards
For existing coal-fired power plants and other existing steam generating units, these rules outline a process -- as required by the Clean Air Act -- under which states must submit plans to EPA for establishing standards.
Under this process, states will have two years from the publication date of these rules to submit plans to EPA for review and approval.
The rule requires that states include a description of their meaningful engagement with a range of stakeholders in developing their plans, including communities that are affected by air pollution from existing power plants, energy communities and workers, small businesses, and reliability authorities.
“This process is intended to help ensure that states take into account the needs of impacted communities and stakeholders in deciding appropriate standards and compliance strategies for existing power plants,” EPA said.
These rules “also provide states with a range of flexibilities, including clear articulation on how localized circumstances can be reflected in compliance requirements under Remaining Useful Life and Other Factors, provisions for allowing emissions trading and averaging that maintain the environmental integrity of the standards, and a pathway for sources to seek a one-year compliance extension for unanticipated delays with control technology implementation that are outside the owner or operator's control,” EPA said.
EPA also has added two optional reliability-related mechanisms that states may choose to incorporate into their plans.
One is a short-term reliability mechanism for units responding to declared grid emergencies (this mechanism is also available to new units). The other is a reliability assurance mechanism for units with cease operations dates that may be needed to stay online longer than anticipated due to documented reliability needs.
Reliability
EPA said the final rules provide power companies with a range of options for managing their existing generating fleets as well as investing in new generation, “and provide the time and flexibility needed for power companies and grid operators to plan and invest for compliance while continuing to support a reliable supply of affordable electricity.”
EPA developed a four-point plan to support reliability, including:
- Flexible rule structure: EPA extended compliance timeframes for coal-fired units to meet compliance obligations by 2-years and simplified subcategories;
- Latitude for state plans: provisions allow states to take reliability into consideration in state plans and state plan revisions, should circumstances change;
- Compliance flexibilities: annual average compliance timeframes are inherently flexible, emissions trading and averaging are allowed provided they respect the environmental integrity of the rule, additionally, sources can access a 1-year extension for unanticipated implementation delays; and
- Reliability Mechanisms: two reliability mechanisms are available -- one is a “short term reliability mechanism” to address grid emergencies, such as natural disasters. The other is a “reliability assurance mechanism” that can provide up to a 1-year extension for units that chose compliance pathways with cease operations dates when a documented reliability need exists and there is insufficient time for a state plan revision.
EPA said its analysis finds that power companies can meet grid reliability requirements with negligible (0-1%) impact on retail electricity prices while complying with the standards.
In EPA’s modeling, retail electricity prices decline over time while the system complies with the rules. These findings hold true even in a scenario with higher load growth, it said.
APPA Statement
The American Public Power Association on April 25 said it recognizes the importance of utilities reducing their carbon dioxide emissions “and is proud of the work that the electric sector has done to decrease CO2 emissions by 36 percent between 2005 and 2022. This work will continue, but as it does – we cannot lose sight of the importance of reliability and cost when serving our communities.”
APPA said it is encouraged that EPA dropped existing natural gas-fired units from inclusion in the final rule and agrees with its finding that hydrogen co-firing, while a promising technology, is not mature enough to be considered a best system of emissions reduction.
“Unfortunately, the rule still includes impractical timelines for existing coal units and reduces the capacity factor threshold for new natural gas-fired units that are very likely to impact grid reliability and increase customer energy bills,” APPA said.
Further, APPA said it is disappointed that the rule includes the requirement to use carbon capture and storage technology to reduce emissions from power plants given it is currently not adequately demonstrated, there are significant difficulties getting permits, and cost.
“Upon initial review, APPA is concerned that the final rule will result in the premature retirement of power plants and at the same time make it much more difficult to get generation built, which is needed to meet increasing electricity demand and resource adequacy needs,” said APPA President & CEO Scott Corwin.
“Public power is committed to further reducing CO2 emissions, but on a more realistic timeframe that ensures the reliability of the electric grid and affordability of electricity for all Americans,” APPA said.
Final MATS RTR Rule
EPA said this final rule includes the most significant improvements and updates to MATS since EPA first issued these standards in February 2012.
In the 2012 final MATS, the EPA established standards to limit emissions of mercury; acid gas hazardous air pollutants such as hydrogen chloride and hydrogen fluoride; non-mercury HAP metals such as nickel, lead, and chromium; and organic HAP such as formaldehyde and dioxins/furans from coal- and oil-fired power plants.
“Based on its latest assessment of available control technologies, EPA is further limiting the emission of non-mercury HAP metals from existing coal-fired power plants by significantly reducing the emission standard for filterable particulate matter (fPM), which is designed as a surrogate emission standard to control non-mercury HAP metals,” the agency said.
EPA is finalizing a two-thirds reduction in the fPM standard. Also, EPA is finalizing the removal of the low-emitting EGU provisions for fPM and non-mercury HAP metals.
EPA is also tightening the emission standard for mercury for existing lignite-fired power plants by 70 percent, to a level that is aligned with the mercury standard that other coal-fired power plants have been achieving under the current MATS, it said.
EPA said its final rule also strengthens emissions monitoring and compliance by requiring coal and oil-fired EGUs to demonstrate compliance with the fPM surrogate emission standard for non-mercury HAP metals by using PM continuous emission monitoring systems (CEMS).
In addition, EPA is revising the startup requirements in MATS to assure better emissions performance during startup.
Technology Review
EPA is strengthening some emission standards in MATS based on its determination that technologies and/or methods of operation are available to achieve additional HAP control from coal-fired EGUs at reasonable costs.
EPA is setting a more stringent standard for emissions of fPM from existing coal-fired EGUs.
EPA is finalizing a change to the fPM emission standard from 0.030 pounds per million British thermal units of heat input (lb/MMBtu) to 0.010 lb/MMBtu.
Currently, 93% of coal-fired capacity without known retirement plans before the compliance period has already demonstrated an fPM emissions rate at or below 0.010 lb/MMBtu.
EPA is also tightening the standard for emissions of mercury from lignite-fired EGUs.
EPA is requiring that lignite-fired EGUs meet the same mercury emission standard as EGUs firing other types of coal (i.e., bituminous, subbituminous, and coal refuse), which is 1.2 pounds per trillion British thermal units of heat input (1.2 lb/TBtu) or an alternative output-based standard of 0.013 pounds per gigawatt-hour electric output. Lignite-fired EGUs were previously subject to a mercury emission standard of 4.0 lb/TBtu.
EPA’s review of information on current mercury emission levels and controls for lignite-fired EGUs shows that lignite-fired EGUs can achieve the more stringent mercury emission rate using available control technologies and/or improved methods of operation at reasonable costs.
As noted above, the final rule also requires that existing coal- and oil-fired EGUs utilize CEMS to demonstrate compliance with the fPM emission standard. EPA estimates that approximately two-thirds of the existing coal-fired generating fleet are not currently utilizing PM CEMS.
The final rule also removes one of the two options for defining the startup period for MATS-affected EGUs, based on a determination that this option is not widely utilized or necessary and that removing it will better secure good emissions performance during startup periods.
Risk Review
The results of the 2020 residual risk and technology review showed that emissions of HAP from coal- and oil-fired power plants have been reduced such that residual risk is at an acceptable level. EPA did not propose, and is not finalizing, any changes to the 2020 Residual Risk Review.
Although EPA did not reopen the 2020 risk review, the finalized standards under this technology review would achieve reductions in HAP emissions from power plants and likely reduce HAP exposures to affected population, it said.
EPA projects that the final MATS standards will result in the following emissions reductions in 2028:
- 1,000 pounds of mercury;
- 770 tons of fine particulate matter (PM2.5)
- 280 tons of nitrogen oxides (NOx)
- 65,000 tons of carbon dioxide (CO2)
- At least 7 tons of non-mercury HAP metals
Power Sector Impacts
“The power sector analysis supporting this action indicates that the final rule would result in relatively minor impacts on the power sector,” EPA said. “For example, EPA projects no significant change to retail electricity prices in the contiguous U.S., and no significant change to the delivered natural gas price is anticipated in response to the final rule.”
In addition, EPA projects that no coal-fired capacity would retire under the final rule. “Consistent with no change in projected retirements, the Agency does not project coal production for use in the power sector to change significantly by 2028, nor does the agency expect significant changes in coal prices. o EPA projects that the rule will not result in significant changes in energy generation or use of natural gas and coal as a result of the final rule,” it said.
Final Steam Electric Effluent Limitation Rule
This regulation establishes a zero discharge of pollutants limitation for three wastewaters generated at coal-fired power plants: flue gas desulfurization (FGD) wastewater, bottom ash transport water (BATW), and combustion residual leachate (CRL).
The regulation also establishes numeric discharge limitations for mercury and arsenic for CRL that is discharged through groundwater and for a fourth wastestream, called legacy wastewater, that is discharged from certain surface impoundments.
The regulation also eliminates less stringent requirements for two subcategories of facilities (high flow facilities and low utilization energy generating units) that were contained in a 2020 regulation.
The final rule includes implementation flexibilities where appropriate, EPA said. For example, recognizing that some coal-fired power plants are in the process of closing or switching to less polluting fuels such as natural gas, the regulation includes flexibilities to allow these plants to continue to meet the 2015 and 2020 regulation requirements instead of the requirements contained in this final regulation.
This is done by creating a new subcategory for EGUs that permanently cease coal combustion by 2034. EGUs in this new subcategory are required to meet the 2020 rule requirements for FGD wastewater and BATW rather than the new, more stringent zero-discharge requirements that apply to other facilities.
This subcategory also contains requirements for CRL discharges that vary based on whether the EGU is still combusting coal or not.
The EPA estimates that this final rule will reduce pollutants discharged through wastewater from coal-fired power plants by more than 660 million pounds per year.
An assessment of rule implementation shows that electricity bills for the average residential household would increase by less than $3.50 per year, EPA said.
“The regulation also includes new provisions to improve transparency and public awareness with respect to water pollution from these facilities. Under the final rule, facilities will be required to post information, such as details of discharges and wastewater treatment systems in use, to a publicly available website,” it said.
Final Legacy CCR Rule
In this final rule, EPA establishes groundwater monitoring, corrective action, closure, and post closure care requirements for these areas.
CCR management units are subject to the regulations when they are located at active facilities and inactive facilities with a legacy CCR surface impoundment.
EPA finalized that for both legacy CCR surface impoundments and CCR management units, owners and operators of facilities first will need to write reports with information to identify the units, include figures of the facilities and where the units are located, and the sizes of the units.
These entities then must post these reports on their websites for the public to access.
This rule becomes effective six months after publication of the final rule in the Federal Register.
No facility is required to meet any of the new requirements before that six-month date.
“The compliance deadlines allow additional time beyond the effective date for facilities to comply with certain technical criteria based on the amount of time EPA projects that facilities need to complete them (e.g., installing the groundwater monitoring system, developing the groundwater sampling and analysis program),” EPA said.
