Transcript NATIONAL ENVIRONMENTAL POLICY ACT (NEPA)

New EPA Challenges for Coal-Fired
Plants
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PRESENTED BY
Peter Glaser
Troutman Sanders LLP
401 9th Street, NW
Suite 1000
Washington, DC 20004
202.274.2950
www.troutmansanders.com
SNL Energy
June 10, 2010
What’s Coming
• Hazardous Air
Pollutants
• NAAQS: NO2, SO2,
PM-2.5, Ozone
• CAIR Replacement
Rule
• Coal Ash
• Carbon
Hazardous Air Pollutants
• EPA to issue proposed MACT for utility
HAP emissions by 3/11, finalize by 11/11.
Highly aggressive schedule.
• Not just for mercury! Other air toxics,
including acid gases, trace metals,
organics, likely more important.
• Ongoing multi-hundred million dollar
information collection effort…but will there
be time for EPA to analyze the data?
• Very stringent standards and only 3 years
for existing units to comply.
• Could have major impacts on existing fleet.
NO2
• Feb. 9, 2010 Revision
• Adds new 1-hour standard of 100 ppb, at
upper end of range of 80-100 ppb in
proposed rule
• Supplements existing annual standard of
53 ppb
• Additional monitoring both around sources
and to measure area-wide concentrations
• Mostly a highway issue but could affect
utility diesel generators
SO2 NAAQS
• Replaces daily and annual standard
with hourly standard.
• Proposed at 50-100 ppb, with
comment taken on 150 ppb.
• Final at 75 ppb.
• Increased monitoring and modeling
around emitting sources, meaning
coal-fired EGUs.
• Concern that even some scrubbed
plants could cause exceedance.
Ozone NAAQS
• 2008 standard: 0.075 ppm based on 8hour average, reduced from prior standard
of 0.084 ppm
• While standard on appeal, new
administration pulls it back for
reconsideration based on existing record
• New proposal 1/19/2010: 0.060-0.070 ppm
• Comments 3/10/10
• Concern across many industries at large
numbers of new nonattainment areas
• For coal EGUs, concern is NOX
PM-2.5 NAAQS
• 2006 standards:
- 24-hour - 35 µg/m3, reduced from
previous standard of 65 µg/m3.
- Annual: 15 µg/m3.
• Overturned in court.
• EPA considering on remand.
• Proposal expected this year.
• Affects coal EGU NOX and SO2
emissions.
CAIR Replacement Rule
• CAIR covered NOx and SO2
transport in East. Overturned in
court.
• New proposal expected any day.
• Will not have same interstate trading
as previous rule; likely intrastate
trading and perhaps some subregional trading.
• Stricter caps and timetables.
Coal Ash
• EPA 5/4/10 proposes two
alternative means of regulation
• Neither addresses filling at
mines - to be addressed
separately
• Comment period ends 90
days after publication of the
proposals in the Federal
Register
• Likely a year or more before
chosen regulation is
implemented
Option 1
• Regulate coal ash as a “special waste”
under “Subtitle C” of RCRA, the regulatory
section addressing “hazardous” wastes
• Complex, comprehensive, and costly
• Would effectively signal the end for surface
disposal of wet coal ash
• Allows “encapsulated” reuse, but this may
be more theoretical than factual
Option 2
• Coal ash would be subject to existing
RCRA standards similar to those for
municipal and non-hazardous solid waste.
• EPA’s role largely advisory; states have
enforcement authority.
• Less costly and onerous requirements.
• Likely lead to phase out of wet handling
and disposal in favor of landfills.
Carbon
• Endangerment Finding
Litigation
• Auto Rule
• Johnson Memorandum
Reconsideration
• Tailoring Rule
• GHG BACT Guidance
• NSPS
Endangerment Finding Litigation
• Finding issued December 7, 2009
• Court challenges from Texas,
Alabama, Virginia and numerous
industry groups
• 17 states on each side
• Don’t expect decision in litigation
until 2012
Auto GHG Rule
• Published in Fed. Reg. May 7, 2010
• DOT MPG - EPA gCO2/mi. standard
• According to EPA, makes six GHGs “regulated air
pollutants” under the PSD and Title V programs
• Will subject most of industrial capacity in U.S. to
GHG regulation under these programs, yet EPA
refuses to do an economic study
• Lawsuits 60 days after publication in Fed. Reg.
Some already filed.
Johnson Memo Reconsideration
• Reconsideration issued 3/2/10.
• GHGs will be deemed to be regulated beginning
1/2/11 when auto rule “takes effect.”
• Will apply to any PSD permit then in process.
• Phase in per tailoring rule.
• Numerous lawsuits filed, including by enviro
organization that will continue argument that GHGs
already regulated.
Tailoring Rule
• Published in Fed. Reg. 6/3/10.
• Phase in of PSD and Title V:
- 1/2/11: Sources subject to PSD “anyway” will be
required to do GHG BACT if increase emissions by
75,000 tons per year.
- 7/1/11: New sources above 100,000 tpy and
existing sources that increase emissions by 75,000
subject to PSD.
- EPA will do future rulemaking and future study to
determine whether lower emitting sources will be
regulated and how, but commits that no source
below 50,000 tpy will be regulated for six years.
• Statutory thresholds are 100/250 tpy, so
questionable legal validity…but will anyone
challenge?
EPA GHG BACT Guidance
• Technical guidance will begin rolling
out later this summer.
• Policy guidance by end of yea.r
• Stakeholder input, but no
commitment to formal notice and
comment.
NSPS
• EPA has agreed to promulgate
NSPS for coal EGUs that will include
GHG standards
• Commence rulemaking probably
next year
• Will apply to new and modified
sources and could also apply
eventually to existing-unmodified
sources
Will Congress Preempt EPA GHG
Regulation?
• Murkowski Resolution to Disapprove
Endangerment Finding.
• Rockefeller bill to delay regulation for
2 years.
• Casey-Carper to …?
• Debate on Murkowski today!
Environmental Regulatory Timeline for Coal Units
Ozone
SO2/NO2
CAIR
Water
Beginning
SO2 Primary
CAIR
Phase
I
Revised
Reconsidered NAAQS
Effluent Guidelines
Proposed CAIR
Ozone Seasonal
Ozone
Final rule expected
Replacement
NAAQS NOx Cap
NAAQS
SO2/NO2
Next Ozone
Final CAIR
Rule Expected
Secondary
NAAQS Revision
Replacement
CAIR
NAAQS
Rule Expected
Vacated
316(b) Compliance
Effluent
316(b) final rule
3-4 yrs after final rule
Guidelines
expected
CAIR
NO2
CO2
proposed rule
Remanded
Primary
Regulation
expected
NAAQS
'08
'09
PM-2.5
SIPs due Begin
CAIR
(‘97)
Phase I
CAMR &
Annual
Delisting
NOx Cap
Rule vacated
'10
Begin
CAIR
Phase I
Annual
SO2 Cap
'11
'12
Next PM2.5
NAAQS
Revision
'13
'15
'14
Effluent Guidelines
Compliance 3-5 yrs
after final rule
'16
PM-2.5
SIPs due
(‘06)
Beginning CAIR
Final
New PM-2.5 NAAQS
Phase II Annual
Rule for
Designations
SO2 & NOx Caps
CCBs
HAPS MACT Begin Compliance
HAPS MACT
Mgmt
Compliance with Compliance 3 yrs
final
rule
Requirements
under
HAPs MACT
Proposed
CAIR
expected
Final CCB Rule
after final rule
proposed
Rule for CCBs
Replacement
Rule
(ground water
Final EPA
rule
Management
monitoring,
double
Nonattainment
316(b) proposed
monitors,
closure,
Designations
rule expected
dry ash conversion)
PM2.5
Ash
Hg/HAPS
CO2
'17
Beginning
CAIR Phase
II Seasonal
NOx Cap
20
-- adapted from Wegman (EPA 2003)