1. NSPS Rulemakings for Greenhouse Gas Emissions
DRAFT -- DELIBERATIVE DOCUMENT
NSPS Rulemakings for Greenhouse Gas Emissions
NACAA
Fall 2011 Membership Meeting
Cleveland, Ohio
October 3, 2011
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2. DRAFT -- DELIBERATIVE DOCUMENT
Background
On December 15, 2009, EPA published the Endangerment Finding
In December 2010, EPA announced that it would begin to address emissions from the two largest stationary source GHG-emitting sectors, power plants and petroleum refineries, under the new source performance standard (NSPS) provisions of the Clean Air Act
Both power plant and refinery rulemakings will focus on:
Standards for new and modified sources
GHG emission guidelines for states to follow for existing sources 2
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3. GHG Emissions from the Industrial Sector
Electric Power
Other Sectors
Other Sectors
Source: Regulatory Impact Analysis for the Mandatory Reporting of Greenhouse Gas Emissions Final Rule (September 2009) 3

4. EPA GHG NSPS Listening Sessions
EPA held five listening sessions on the GHG NSPS for EGUs and Refineries
Session 1: Electric Power Industry Representatives
February 4, Washington, DC
Session 2: Environmental and Environmental Justice Organization Representatives
February 15, Atlanta, GA
Session 3: State and Tribal Representatives
February 17, Chicago, IL
Session 4: Coalition Group Representatives
February 23, Washington, DC
Session 5: Petroleum Refinery Industry Representatives
March 4, Washington, DC 4

5. Key Questions for the EGU GHG NSPS
What should emission limits for new sources be based on?
What should emission limits for modified sources be based on?
What should emission limits for existing sources be based on?
What regulatory mechanisms should be used to get reductions?
How should State equivalency with guidelines be addressed? 5

6. EGU New Source Limits
Listening session comments included a range of alternatives:
Coal with carbon capture and storage (CCS) type limits/natural gas standards
Best non-CCS coal technology limits (e.g., ultra-supercritical/integrated gasification combined cycle (IGCC))
Key considerations
Availability and cost of technologies
Some full scale CCS projects are moving forward
Coal with CCS being built (e.g., Southern Co. Kemper Project)
Financing the Kemper project and other permitted CCS coal power plants includes a level of government funding
Cost of non-CCS technologies vs. natural gas
EIA projects no new central station coal-fired power plants beyond those already under construction or supported by clean coal initiatives – AEO 2011 6

7. EGU Modified Source Limits
In the listening sessions and in other forums, we have heard:
Modified requirements triggered by hourly (not annual) emission increases
Historically, rarely triggered for NSPS, if triggered, usually triggered under PSD
For GHGs, could be triggered by emission control installations, where chemical reactions from controls create GHG (e.g., limestone scrubbing)
Need to consider potential impact with respect to:
Conventional pollutant regulations
Comprehensive State GHG programs for existing sources
Some have suggested considering options to treat more as existing source than new source 7

8. Emission Reduction Opportunities from Existing Fossil Fuel-fired EGUs
Efficiency improvements at existing units
Co-firing/Fuel switching with lower GHG fuels at existing units
Reduction in generation from high emitting units
Switching to lower emitting units
Demand side reductions
CCS at existing units 8

9. A Broad Range of Regulatory Options Have Been Suggested
Source-specific standards based on efficiency improvements
Efficiency based standards with emissions averaging
Emissions averaging with required levels assuming control strategies beyond efficiency improvements
Less utilization of higher GHG-emitting units
More utilization of lower GHG-emitting units (e.g., for under-utilized gas combined cycle units)
Percentage reduction requirements 9

10. Other Key Points Raised Related to Existing Source Guidelines
Applicability
Definitely includes boilers and IGCC units
What about combined cycle units and simple cycle turbines?
Form of the standard?
Input vs. output-based standard?
Mass vs. rate? 10

11. State Equivalency
General agreement across a wide range of stakeholders that states should have flexibility in developing programs equivalent to emission guidelines
Related viewpoints
Let states build off existing programs
Credit for early action
Multi-state utilities also suggested that cross-state consistency would provide cost savings 11

12. State Equivalency: Key Questions
How is equivalency demonstrated?
For multi-state programs
For programs with cross-border components
For multi-sector programs
Crediting of:
Early reductions
Demand side management
Other non-EGU reductions
EPA is looking forward to continued dialogue with state and local officials on the rulemaking efforts 12

13. Additional Information
More information can be found at:
Information on the GHG settlement agreement and other regulations affecting EGUs and Refineries is posted at:
More information on the GHG listening sessions, including video recordings of the sessions, is posted at: 13