1. Clean Air Mercury Rule

2. EPA Rule to Control Mercury Emissions from Coal-Fired Electric Utilities New Source Performance Standard (CAA 111) Allows for Mercury Emissions Trading National Cap Distributed by EPA to States States Distribute Mercury Allowances to Facilities Clean Air Mercury Rule

3. Clean Air Mercury Rule (CAMR) Published May 18, 2005 [70 FR 28605]  Amended NSPS Subpart Da Hg emission limits for utility units constructed after January 30, 2004  NEW Subpart HHHH – Trading Program  State Hg budgets  Model Trading Rule  Performance Specification 12A – Hg CEMS  40 CFR Part 75, Appendix K – Sorbent Traps

4. State Responsibilities Rulemaking:  Submit NSPS plan to EPA by November 17, 2006  Notify EPA of Hg allowance allocations by October 31, 2006 (if adopt interstate trading program) for 2010, 2011, 2012 Administration:  Issue Hg Budget permits – modify Title V permit  Review monitoring system certifications  Enforcement for exceeding allowances held

5. CAMR TRI Is this Really “Excess?” Q: What to Do with “Excess?” A: Need to Validate Reported Figures Mercury Allowances: CA, CO, HI, ND, NV, SD, UT, WY

6. Mercury Allowances: AK, AZ, MT, NM, OR, WA CAMR TRI Is this Really “Shortage?” Q: What if There’s No “Excess?” A: Need to Validate Reported Figures All States Will Be Challenged to Determine Their Role, Fate

7. WESTAR Region: Mercury Allowances Thru 2010

8. Clean Air Mercury Rule Red Flag – EPA developed rule with the idea that technology for mercury control will not be adequately demonstrated until after 2010 Used $39,000 per pound in 2020 in analysis/calculations 2005 Congressional Hearing (Institute for Clean Air Companies) estimated current control $2000) – EPA’s own analysis projects actual emissions to be 24.3 tons as 2020s (estimates outside EPA for full compliance is 2030) – Rule’s underpinnings are influenced by this State Budgets (Allowances) – CAP & Trade KEY PRINCIPLE cost of emission control is varied from high to low Company’s adopt known current technologies to avoid future risk

9. Clean Air Mercury Rule Banking