EPA has announced that it will issue two sets of rules limiting CO2 emissions from power plants under Section 111 of the Clean Air Act: first a rule on standards for new plants and then one for existing facilities. That section of the Act requires EPA to determine that a standard of performance is based on the “best system of emission reduction” that has been “adequately demonstrated.”
On September 20, 2013, EPA issued (but has yet to publish for comment) draft rules for existing power plants. EPA set the emissions limit for coal-fired power plants at 1,100 pounds of CO2 per MWh, which will require those facilities to install carbon capture and storage, or CCS, technology. EPA claims that the standard would not likely require new plants to capture all of their CO2—more likely about 30-50%—based on the assumption that some existing advanced plants can already achieve an emissions rate of 1,700 lbs./MWh to 1,900 lbs./MWh.
The EPA said fossil fuel-fired boilers and integrated gasification combined-cycle units, subject to a 1,100 lbs./MWh limit, can opt to take one of two compliance strategies: they can meet the 1,100 lbs./MWh limit over a 12-month operating period or emit in a range of 1,000 lbs./MWh to 1,050 lbs./MWh over an 84-operating month, or seven-year, period. In a technical Fact Sheet, EPA has said that “[t]he longer compliance period option provides flexibility by allowing sources to phase in the use of partial CCS. The owner/operator can use some or all of the initial 84-operating month period to optimize the system.”
In the draft rule, EPA cited as examples of “adequately demonstrated” CCS a pilot project, later discontinued, by AEP at its Mountaineer Plant and “significant progress” that had been made at several other facilities that were under construction, including Southern Company’s Kemper facility, SaskPower’s Boundary Dam in Saskatchewan, the Texas Clean Energy Project and the Hydrogen Energy California Project. In addition, EPA claimed that there are other projects underway as listed in DOE/National Energy Technology Laboratory’s Carbon Capture, Utilization, and Storage Database. Claims that these projects prove the technology have been adequately demonstrated has been under attack since the draft rule was released and have suffered additional setbacks in the past several weeks.
First, a Work Group of an EPA Science Advisory Board charged with reviewing the rule expressed concern in a November 12, 2013 memorandum that there might not be “an adequate scientific and technological basis” for the proposed emissions limits for new coal-fired plants. The November 12 memo indicated that unspecified new information from DOE’s National Energy Technology Lab undercut EPA’s claims that CCS had been adequately demonstrated:
The EPA has stated that U.S. Department of Energy National Energy Technology Laboratory (NETL) studies as well as existing EGUs under construction and in advanced stages of development were used as the basis for the BSER assumptions for new natural gas and coal fuel sources for new EGUs. EPA staff explained that the NETL studies were all peer reviewed and EPA did not conduct additional peer review(s). However, based on additional information provided to the Work Group from NETL, the peer review appears to be inadequate.
More recently, by letter of November 15, 2013, pro-coal members of the House advised EPA that the Energy Policy Act of 2005 prohibited EPA from using DOE-funded demonstration CCS projects to support a finding that the technology is adequately demonstrated.
This article was authored by Robert McLusky, Jackson Kelly, PLLC. For more information on the author, see here
 The EPA is proposing to set emissions limits for new large gas-fired power plants at 1,000 lbs./MWh, which is equal to the previously proposed limit and will not require add-on control technology for those facilities to meet it.