1. Regulatory Update Mercury & Air Toxics Standards (MATS)
Patrick Bird, USEPA Region 1
NESCAUM Stationary Source Conference
Albany, NY
April 4, 2013
11/9/2018
U.S. Environmental Protection Agency

2. U.S. Environmental Protection Agency
Overview of Action
On February16, 2012 EPA promulgated the Mercury and Air Toxics Standards (MATS), the first national standards to reduce emissions of mercury and other toxic air pollutants from new and existing coal- and oil-fired power plants
Standards will reduce emissions of:
Metals, including mercury (Hg), arsenic, chromium, and nickel
Acid gases, including hydrogen chloride (HCl) and hydrogen fluoride (HF)
Particulate matter
Air toxic pollutants are linked to cancer, IQ loss, neurological damage, heart disease, lung disease and premature death
Standards create uniform emissions-control requirements based on proven, currently in-use technologies and processes
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U.S. Environmental Protection Agency

3. Overview of Action (cont.)
On November 30, 2012, EPA published proposed amendments to emission limits for new power plants and revisions to startup/shutdown provisions for new and existing power plants.
Startup/shutdown provisions – Some air pollution control devices require appropriate temperature to be reached before engaging. Reconsideration proposed engaging “as soon as technically feasible.”
On March 28, 2013, EPA finalizes proposed revisions to November 2012 reconsideration, focusing on new power plants.
Finalized amendments do not address issues posed in the reconsideration related to startup and shutdown.
For more information on these Mercury and Air Toxics Standards:
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U.S. Environmental Protection Agency

4. Compliance Dates for Existing EGUs
Initial Notifications – August 14, 2012
Required existing sources to analyze three previous years of operating history to determine appropriate subcategory
Initial Compliance Deadline – August 14, 2015 (3 year compliance period)
Compliance Extensions
As described in EPA OECA memo dated December 16, 2011
“Fourth Year” - Pursuant to CAA §112(i)(3)(B), permitting authority extensions
“… necessary for the installation of controls.”
“Fifth Year” - Pursuant to CAA §113(a), Administrative Orders (AOs)
“… for a specific and documented reliability concern.”
FERC to act as advisor to EPA on AO extension decisions (May 17, 2012 FERC Policy Statement)
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U.S. Environmental Protection Agency

5. Will MATS Turn the Lights Out?
No. For 40 years, we have been able to implement the Clean Air Act without causing the lights to go out. MATS will not change that.
EPA and DOE analyses indicate that there will be more than enough electric generating capacity to meet the nation’s needs.
EPA projects 4.7 GW will retire out of the more than 1000 GW that make up the nation’s electric generating capacity. That’s less than one half of one percent. Most of this capacity is decades old and does not have modern pollution controls installed.
“They (the FPC) refer to the unrealistic requirements that emissions be measured at the top of the stack, instead of at ground level where people live and breathe.”
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Published in New York Times, July, 9, 1974

6. MATS - Nationally Significant
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U.S. Environmental Protection Agency
Source: National Electric Energy Data System (NEEDS 4.10 MATS) (EPA, December 2011) and EPA’s Information Collection Request (ICR) for New and Existing Coal- And Oil-Fired Electric Utility Stream Generation Units (2010)

7. Status of Compliance Extensions
Region
Extensions*
Notes
Region 1
None at this time
Region 2
1 PR (expected)
Region 3
3 WV
Region 4
None at this time, closures expected
Region 5
4 IN, 5 MI
Region 6
1 TX
Region 7
4 KS, 7 MI , 5 NE
Region 8
Region 9
4 AZ, 1 HI
Region 10
* Section 112(i)(3)(B) extensions
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U.S. Environmental Protection Agency

8. MATS Compliance in Region 1
To date, no §112(i)(3)(B) compliance extension requests
Most New England EGUs expected to be in compliance with MATS
Units in question of meeting 2015 compliance date
Schiller Station (NH)
SR 4 and 6 – 51 MW coal fired units
August 2012, tested several sorbent injection control technologies on SR 4 & 6
Plant closures
Salem Harbor Station (MA) – 750 MW coal- and oil-fired plant, slated for closure June 2014.
Mount Tom Station (MA) – 150 MW coal-fired plant, approved for dynamic de-list bid for Unknown operating status thereafter.
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U.S. Environmental Protection Agency

9. Watching Economic Factors
Projections of natural gas prices
Low natural gas prices have resulted in historically low wholesale electricity prices
ISO-New England system analyses
Not-for-profit corporation created in 1997 to oversee New England’s restructured electric power system
Major responsibilities
Reliable operation of the electric grid
Administer wholesale electricity markets
Plan for future system needs
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10. Electricity Generation in New England
Source: ISO-NE. Energy Sources in New England
Source: ISO-NE. Energy Sources in New England
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Source: ISO-NE. Energy Sources in New England
Source: ISO-NE. Energy Sources in New England

11. U.S. Environmental Protection Agency
Electricity Generation in New England
Source: ISO-NE. Energy Sources in New England
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U.S. Environmental Protection Agency

12. U.S. Environmental Protection Agency
Electricity Generation in New England
Source: ISO-NE. Energy Sources in New England
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U.S. Environmental Protection Agency

13. U.S. Environmental Protection Agency
Electricity Generation vs. Capacity
in New England
Source: ISO-NE. CELT Report
Source: ISO-NE. Energy Sources in New England
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U.S. Environmental Protection Agency

14. U.S. Environmental Protection Agency
Forward Capacity Market
The locational capacity market whereby the ISO-NE will project the needs of the power system three years in advance and then hold an annual auction to purchase power resources to satisfy the region’s future needs.
ISO-NE proposed changes to auction rules for FERC approval
Removal of auction floor price proposed for 2017/2018 commitment period, (auction held in February 2014)
Price could drop from ~$3.40/kW-mnth to $ /kW-mnth
Based on financial projections conducted by UBS Utilities
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U.S. Environmental Protection Agency

15. U.S. Environmental Protection Agency
Combination of Economic Factors
ISO-NE expects significant retirements of coal- and oil-fired plants by end of decade
ISO-NE Strategic Transmission Analysis: Generation Retirements Study, December 2012
In this study, 28 units representing nearly 8,300 MW of capacity were assumed to be at risk of retirement by 2020
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U.S. Environmental Protection Agency

16. U.S. Environmental Protection Agency
Source: Sheilendranath, Akarsh. ISO-NE. Strategic Transmission Analysis: Generation
Retirements Study. Planning Advisory Committee Meeting. December 13, Slide 11.
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U.S. Environmental Protection Agency

17. U.S. Environmental Protection Agency
Closing Thoughts
National rollout of MATS is as expected.
Regionally, MATS has little to no impact on electricity generating fleet or regional electricity reliability.
Economic factors, largely based on the price of natural gas, are driving the New England electricity generation mix.
New England could see major retirements of coal- and oil-fired EGUs because of economic, not environmental, considerations.
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U.S. Environmental Protection Agency

18. U.S. Environmental Protection Agency
Contact Information
Patrick Bird
USEPA Region 1
5 Post Office Square, 05-02
Boston, MA
Phone:
Fax:
11/9/2018
U.S. Environmental Protection Agency