1. North Carolina Clean Smokestacks ACT Air Innovations Conference Chicago, IL August 11, 2004 Brock Nicholson, P.E. Deputy Director N.C. Division of Air Quality

2. Clean Smokestacks Act Results from Broad Stakeholder Effort n Utility Companies n Legislative Sponsors n Environmental Community n Division of Air Quality / Dept. of Environment and Natural Resources n Governor’s Office n Attorney Generals Office n State Utilities Commission n Business and Industrial Community n Utility Rate Payers

3. Background on Origin and Creation of Clean Smokestack Act n In 1st Year: Concerns About Air Quality in Western NC Environmental Group Efforts NOx SIP Rule Legislative Sponsors Ownership Real Reductions in NC Deal on Pollutant Caps Cost Recovery SAMI Finding Support by Utility Companies n In 2nd Year: Leadership by Governor Creativeness by Utilities Commission and Companies Handling of “Credits” Support of Industry Customers Alignment of Stars

4. North Carolina Clean Smoke Stacks Act n NOx & SO2 Caps on Emissions Tons / year Caps per Company - They decide on Controls n Phased Compliance; 1 Jan ’07, ‘09, ‘13 n Actual Reductions in NC n Unique Cost Recovery Feature n Recommendations on Hg & CO2; Sep ‘05 n Reduction Credits Held by the State n SAMI: Greatest AQ Benefit for a State Comes from Reductions in that State; but, Controls in All States Needed to Fully Solve AQ Problems

5. Utility Company Plans n Initial Plans Submitted n 22 SO2 Scrubbers n 36 SCR / SNCR Units n Most with Combustion Controls n NOx Controls in Place Starting in 2001 n SO2 Scrubbers Scheduled to be in Starting in 2005

6. Emissions Reductions Under Clean Smokestacks Bill 50,000 100,000 150,000 200,000 250,000 300,000 350,000 400,000 450,000 500,000 1998 20072009 1998 2009 2013 NOx (tons/year) SO 2 (tons/year) 245,000 60,000 56,000 489,000 250,000 130,000

8. n Across Class I areas and meteorological conditions, SO4 is largest contributor to aerosol mass. Organic aerosols are second largest contributor; NO3 and soils have small contributions n Most of changes in visibility in SAMI strategies due to changes in SO2 emissions SAMI Key Findings: Visibility

9. Observations: SO2 Sensitivity Maps State to State Comparison: n In general, the largest change in SO4 aerosol or SO4 deposition in a SAMI state is due to SO2 emissions changes in that state n Each SAMI state contributes to change in SO4 aerosol or SO4 deposition in neighboring SAMI states.

10. Daily SO 4 Aerosol & its Change on July 15, 1995 for a 10% Reduction of 2010 Strategy A2 SO 2 Emissions KYWVVA TN 2010-A2NC ALGASC +0.15 +0.05 - 0.05 - 0.15 - 0.25 - 0.35 - 0.45 - 0.55  g/m 3 ( Class 5 day)

11. Sipsey, AL Cohutta, GA Joyce Kilmer, NC Look Rock, (Smokies), TN Shining Rock, NC Linville Gorge, NC James River Face, VA Shenanhoah, VA Otter Creek, VA Dolly Sods, WV Annual SO4 Aerosol Response to 10% Reduction in SO2 Emissions from 2010 A2 strategy SO4 Aerosol Sensitivity (%) Other FL&MS NE MW CN WV VA TN SC NC KY GA AL

12. References / Contact n Text of Act: http://www.ncleg.net/html2001/bill s/AllVersions/Senate/S1078vc.ht ml n www.ncair.org n Brock.Nicholson@ncmail.net 919-715-0587