Tuesday, January 03, 2012

EPA issues Final Mercury & Air Toxics Standards With Provisos

Dec 21: As expected and in response to a court deadline, only a few days late, U.S. EPA issued the final Mercury and Air Toxics Standards (a.k.a. MATS or "Utility MACT) [See WIMS 11/29/11], the first national standards to protect American families from power plant emissions of mercury and toxic air pollution like arsenic, acid gas, nickel, selenium, and cyanide. EPA said the standards will "slash emissions of these dangerous pollutants by relying on widely available, proven pollution controls that are already in use at more than half of the nation's coal-fired power plants." The Agency estimates that the new safeguards will prevent as many as 11,000 premature deaths and 4,700 heart attacks a year. The standards will also help America's children grow up healthier – preventing 130,000 cases of childhood asthma symptoms and about 6,300 fewer cases of acute bronchitis among children each year. EPA said it estimates that for every dollar spent to reduce pollution from power plants, the American public will see up to $9 in health benefits. The total health and economic benefits of this standard are estimated to be as much as $90 billion annually. 

    EPA Administrator Lisa Jackson said, "By cutting emissions that are linked to developmental disorders and respiratory illnesses like asthma, these standards represent a major victory for clean air and public health– and especially for the health of our children. With these standards that were two decades in the making, EPA is rounding out a year of incredible progress on clean air in America with another action that will benefit the American people for years to come. The Mercury and Air Toxics Standards will protect millions of families and children from harmful and costly air pollution and provide the American people with health benefits that far outweigh the costs of compliance."
    In a rare accompanying action which attempts to respond to various industry and Republican concerns, President Obama issued a Presidential Memorandum to the EPA Administrator entitled, "Flexible Implementation of the Mercury and Air Toxics Standards Rule." The Memorandum indicates in part, "The MATS Rule can be implemented through the use of demonstrated, existing pollution control technologies. The United States is a global market leader in the design and manufacture of these technologies, and it is anticipated that U.S. firms and workers will provide much of the equipment and labor needed to meet the substantial investments in pollution control that the standards are expected to spur. . .

    "Analyses conducted by the EPA and the Department of Energy (DOE) indicate that the MATS Rule is not anticipated to compromise electric generating resource adequacy in any region of the country. The Clean Air Act offers a number of implementation flexibilities, and the EPA has a long and successful history of using those flexibilities to ensure a smooth transition to cleaner technologies. The Clean Air Act provides 3 years from the effective date of the MATS Rule for sources to comply with its requirements. In addition, section 112(i)(3)(B) of the Act allows the issuance of a permit granting a source up to one additional year where necessary for the installation of controls. As you stated in the preamble to the MATS Rule, this additional fourth year should be broadly available to sources, consistent with the requirements of the law. . . The EPA has concluded that 4 years should generally be sufficient to install the necessary emission control equipment, and DOE has issued analysis consistent with that conclusion. While more time is generally not expected to be needed, the Clean Air Act offers other important flexibilities as well. . ."

    The President indicates that, "To address any concerns with respect to electric reliability while assuring MATS' public health benefits, I direct you to take the following actions:

"1. Building on the information and guidance that you have provided to the public, relevant stakeholders, and permitting authorities in the preamble of the MATS Rule, work with State and local permitting authorities to make the additional year for compliance with the MATS Rule provided under section 112(i)(3)(B) of the Clean Air Act broadly available to sources, consistent with law, and to invoke this flexibility expeditiously where justified.

"2. Promote early, coordinated, and orderly planning and execution of the measures needed to implement the MATS Rule while maintaining the reliability of the electric power system. Consistent with Executive Order 13563, this process should be designed to "promote predictability and reduce uncertainty," and should include engagement and coordination with DOE, the Federal Energy Regulatory Commission, State utility regulators, Regional Transmission Organizations, the North American Electric Reliability Corporation and regional electric reliability organizations, other grid planning authorities, electric utilities, and other stakeholders, as appropriate.

"3. Make available to the public, including relevant stakeholders, information concerning any anticipated use of authorities: (a) under section 112(i)(3)(B) of the Clean Air Act in the event that additional time to comply with the MATS Rule is necessary for the installation of technology; and (b) under section 113(a) of the Clean Air Act in the event that additional time to comply with the MATS Rule is necessary to address a specific and documented electric reliability issue. This information should describe the process for working with entities with relevant expertise to identify circumstances where electric reliability concerns might justify allowing additional time to comply."

    EPA indicated it estimates that manufacturing, engineering, installing and maintaining the pollution controls to meet these standards will provide employment for thousands, potentially including 46,000 short-term construction jobs and 8,000 long-term utility jobs.

    EPA said power plants are the largest remaining source of several toxic air pollutants, including mercury, arsenic, cyanide, and a range of other dangerous pollutants, and are responsible for half of the mercury and over 75 percent of the acid gas emissions in the United States. EPA also indicated that more than half of all coal-fired power plants already deploy pollution control technologies that will help them meet these achievable standards. Once final, these standards will level the playing field by ensuring the remaining plants -- about 40 percent of all coal fired power plants -- take similar steps to decrease dangerous pollutants.

    EPA indicated that the Mercury and Air Toxics Standards and the final Cross-State Air Pollution Rule, which was issued earlier this year [See related article below], are the most significant steps to clean up pollution from power plant smokestacks since the Acid Rain Program of the 1990s. EPA said that combined, the two rules are estimated to prevent up to 46,000 premature deaths, 540,000 asthma attacks among children, 24,500 emergency room visits and hospital admissions. The two programs are an investment in public health that will provide a total of up to $380 billion in return to American families in the form of longer, healthier lives and reduced health care costs. EPA also released two summaries of support comments from organizations, medical associations, environmental organizations, House & Senate members and others [See links below].

    The U.S. Chamber of Commerce President and CEO Thomas Donohue issued a statement saying, "We are tremendously disappointed with the administration's decision to ignore the significant risks that will result from the implementation timeline of the Utility MACT rule. In the final rule, the administration acknowledged the need to provide utilities additional time to comply.  However, without any certainty that utilities will actually be able to secure additional time in the future, the rule as currently issued could threaten America's electricity reliability, global competitiveness, and job creation.  The Utility MACT rule is unprecedented in its size and scope and could literally leave our nation's economy in the dark.

    "We wholeheartedly share this and previous administrations' goals of protecting public health and the environment, but the rushed implementation of this rule could undermine the nation's economic recovery. Utility companies and the independent organizations responsible for the reliability of the electric grid have expressed their grave concerns about this rule for months.  Yet the final rule, like the earlier proposed rule, provides no certain additional time. The rule will require power plants to be shut down, significantly modified, or replaced, and for gas pipeline and electric transmission infrastructure to be built. Making these sweeping changes to business operations is a long-term process and it is unrealistic to think businesses can comply with this rule within three years, with an uncertain prospect for limited additional time, particularly in light of the significant regulatory burdens companies will face in siting and permitting these large projects. We urge the administration to reconsider the unrealistic implementation timetable for the Utility MACT rule and the effects it will have on American businesses of all sizes.  Jobs, our economy, and the reliability of our electricity grid are at stake."

    The Edison Electric Institute (EEI) President Tom Kuhn issued a statement saying, "EPA's MACT rule is the most expensive rule in the agency's history. It will require a significant number of electric generating units to design, obtain approval for and install complex controls or replacements in a very short timeframe. In some cases, it will mean that new transmission and natural gas pipelines will have to be built. EPA has made useful technical changes from its original proposal. Nevertheless, we believe the Administration is underestimating the complexity of implementing this rule in such a short period of time, which can create reliability challenges and even higher costs to customers. The Administration is not using all the available authorities in the Clean Air Act to coordinate implementation, to ensure electric reliability, and to avoid excessive costs."
    House Energy and Commerce Committee leaders, including Chairman Fred Upton (R-MI) and Energy and Power Subcommittee Chairman Ed Whitfield (R-KY) also commented on the new rules. Chairman Upton said, "Electricity not only lights our homes, it powers all sectors of our economy, including our businesses, hospitals, communication systems and critical infrastructure. Analyses predict EPA's rules will force the premature retirement of power plants that are needed to provide affordable, reliable power to consumers and our growing economy. Other plants will require multi-million dollar retrofits that will result in higher electricity bills. I am concerned the administration decided to issue this rule without a comprehensive analysis assessing how it will affect jobs and the price and reliability of electricity. Under the rules, parts of the country face very real threats of rolling brownouts and blackouts. Most concerning is the tremendous impact this rule will have on low-income families who are struggling just to keep the lights on." Representative Whitfield said, "Not only has President Obama's regulatory agenda made it harder for new electricity generation to be built, but these new regulations will increase energy prices for Americans who can least afford to pay more to light and heat their homes, and for businesses that need reliable, affordable energy to compete globally. These rules hurt consumers, they hurt businesses, and they hurt jobs."
   Access a release from EPA (click here). Access the Presidential Memorandum (click here). Access the EPA MATS website with extensive background and details and state-by-state benefits (click here). Access supporting comments (click here); and (click here). Access the U.S. Chamber statement (click here). Access the statement from EEI (click here). Access the statements from Reps. Upton & Whitefield (click here). [#Air]