Carbon Regulation for Power Plants

NEW POWER PLANT REGULATIONS

Recently, the Environmental Protection Agency (EPA) proposed a greenhouse gas (GHG) regulation for new power plants that would substantially limit the sources of energy available to power U.S. homes and business. The first in a suite of impending GHG regulations, this rule would effectively ban the construction of new coal-fired power plants in the United States by requiring them to be equipped with carbon capture and sequestration (CCS) systems. While CCS is a promising technology, it is prohibitively expensive and is not in use at a single commercial-scale power plant in the country.

EXISTING POWER PLANT REGULATIONS

In the second suite of GHG regulations released June 2, 2014, the EPA proposed GHG regulations for existing power plants. Unlike the new power plants regulation, the existing power plants regulation will impact plants that are already supplying electricity to homes and businesses throughout the country. The United States and Midwestern states rely on fossil fuels for a majority of the electricity that keeps the lights on in our homes and businesses and powers the economy. This regulation threatens to shut down many of the plants that produce this low-cost, reliable electricity.

MODIFIED AND RECONSTRUCTED PLANT REGULATIONS

In addition to regulating new and existing power plants, on June 2, 2014, the EPA proposed GHG regulations for modified and reconstructed power plants.

IMPACT OF EPA REGULATIONS

An analysis from the National Economic Research Associates (NERA) estimates that a National Resources Defense Council (NRDC) proposal, similar to EPA proposals, could cost consumers $13 billion to $17 billion per year in higher electricity and natural gas prices. Ratepayers in most states could face double digit electricity price increases. Natural gas prices could increase by as much as 16 percent, costing families and businesses up to $54 billion more between 2018 and 2033. NERA also found that such a proposal could cause job losses as high as 2.85 million. A new U.S. Chamber study also analyzes the impacts of the NRDC proposal and the Obama Administration’s announced GHG reduction goals.

 

RESOURCES

PROPOSED RULES

Carbon Pollution Emission Guidelines for Existing Stationary Sources: Electric Utility Generating Units: June 2, 2014

The EPA is proposing state-specific rate-based goals for carbon dioxide emissions from the power sector, as well as guidelines for states to follow in developing plans to achieve the state-specific goals. EPA also released a NOTA in late October, 2014.

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Carbon Pollution Standards for Modified and Reconstructed Stationary Sources: Electric Utility Generating Units: June 2, 2014

The EPA is proposing standards to limit emissions of carbon dioxide from affected modified and reconstructed electric utility steam generating units and from natural gas-fired stationary combustion turbines.

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Proposed EPA Rule for Standards of Performance for Greenhouse Gas Emissions from New Stationary Sources: Electric Utility Generating Units: Jan. 8, 2014

The EPA is proposing new standards of performance for new affected fossil fuel- fired electric utility steam generating units and stationary combustion turbines. This action proposes a separate standard of performance for fossil fuel-fired electric utility steam generating units and integrated gasification combined cycle units that burn coal, petroleum coke and other fossil fuels that is based on partial implementation of carbon capture and storage as the best system of emission reduction. This action also proposes standards for natural gas-fired stationary combustion turbines based on modern, efficient natural gas combined cycle technology as the best system of emission reduction.

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ADMINISTRATION DOCUMENTS

Clean Power Plant Supplemental Proposed Rulemaking: Indian Country and U.S. Territories

Clean Power Plant Mass Based Equivalence Conversion Guidance

Clean Power Plan NOTA

The Cost of Delaying Action to Stem Climate Change: July 2014.

Interactive Clean Power Plan Map

Clean Power Plan Proposed Rule – Related Files

Listing of U.S. EPA Requests for Comment – Clean Power Plan

Proposed Carbon Pollution Standards for Modified and Reconstructed Power Plants – Related Files

2013 Proposed Carbon Pollution Standard for New Power Plants – Related Files

Weekly Address: Reducing Carbon Pollution in Our Power Plants (Video): May 31, 2014

Effect of EPAct05 on BSER for New Fossil Fuel-fired Boilers and IGCCs: Jan 8, 2014

EPA Fact Sheet: Reducing Carbon Pollution from Power Plants, Details About the Proposal for New Sources

Considerations in the Design of a Program to Reduce Carbon Pollution from Existing Power Plants: Sept. 23, 2013

Presidential Memorandum — Power Sector Carbon Pollution Standards: June 25, 2013

The President’s Climate Action Plan: June 2013


COURT CASES & STATUTE

West Virginia, et al. V. US EPA.

Clean Air Act, as amended through Feb. 24, 2004.

Utility Air Regulatory Group v. Environmental Protection Agency ET AL.


CARBON CLIPS

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PRESS RELEASES

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COMMENTS

Existing Source Performance Standards:

December 1, 2014 Comments to EPA:

Alliant Energy

Canadian Hydropower Association

Clean Wisconsin

Manitoba Province Deputy Minister Eldridge

Edison Electric Institute

Electric Power Research Institute

Federal Energy Regulatory Commission – Moeller

Wisconsin Governor Walker

Institute for Energy Research

Marathon Petroleum

Madison Gas and Electric

Manitoba Hydro Discussion with EPA

Midcontinent Independent System Operator

National Association of Regulatory Utility Commissioners

National Federation of Independent Business

Partnership for a Better Energy Future

Utility Air Regulatory Group – 1

UARG – 2

UARG – 3

UARG – 4

UARG – 5

UARG – 6

UARG – 7

UARG – 8

UARG – 9

UARG – 10

UARG – 11

UARG – 12

Central Wisconsin Electric Cooperative

Wisconsin Manufacturers and Commerce, et al

WPPI Energy

Wisconsin Utilities Association

Xcel Energy

Wisconsin Industry Comments to EPA: December 1, 2014.

Wisconsin Governor Walker Comments to EPA: December 1, 2014.

Wisconsin Legislature Comments to EPA: December 1, 2014.

US Chamber: Comments to EPA: December 1, 2014.

PBEF: Comments to EPA: December 1, 2014.

WDNR and PSCW Comments to EPA: November 30, 2014.

WDNR Comments to EPA on Notice of Data Availability: November 30, 2014.

MISO Comments to EPA: November 25, 2014.

Madison Gas & Electric Comments to EPA: November 24, 2014.

MSEER Comments to EPA: November 21, 2014.

US Chamber: Request to Extend Comment Period: November 12, 2014.

Comments to WDNR/PSCW from Wisconsin Stakeholders

WI Stakeholder Position Matrix

Republican Governors Association Comments to President Obama

Wisconsin Governor Walker Comments to EPA

Industry Joint Responses to WDNR and PSCW Questions

Wisconsin Utility Joint Responses to WDNR and PSCW Questions

We Energies Responses to WDNR and PSCW Questions

WDNR and PSCW Questions on EPA’s Clean Power Proposal

AGs Letter to EPA: August 25, 2014.

NMA: EPA Proposed Guidelines for Carbon Dioxide Emissions from Existing Power Plants: July 29, 2014.

PBEF: Position Letter to EPA: July 21, 2014.

American Coalition for Clean Coal Electricity Position on Setting 111(d) Standards OMB Presentation (Slides): May 2014

North Carolina Department of Environmental and Natural Resources ESPS Comments: Jan. 27, 2014

Texas Commission on Environmental Quality ESPS Comments: Jan. 14, 2014

Public Service Commission of WI ESPS Comments: Dec. 13, 2013

Modified and Reconstructed Performance Standards:

NAM: Comments to EPA on Modified and Reconstructed Sources: October 16, 2014.


New Source Performance Standards:

Senate Letter to President on NSPS: May 21, 2014

American Coalition for Clean Coal Electricity NSPS Comments: May 9, 2014

Partnership for a Better Energy Future NSPS Comments: May 9, 2014

Wisconsin Manufacturers and Commerce NSPS Comments: May 9, 2014

Letter to EPA from State Environmental Agency Secretaries, with WI DNR Sec. Stepp: May 8, 2014

WI Department of Natural Resources and WI Public Service Commission NSPS Comments: May 6, 2014

WI Department of Natural Resources Bureau of Air Management NSPS Comments: May 4, 2014

Wisconsin Governor Walker NSPS/ESPS Comments: Nov. 3, 2013

Letter to EPA from State AGs, with WI AG Van Hollen: Sept. 11, 2013

Wisconsin Manufacturers and Commerce NSPS Comments: June 25, 2012

American Coalition for Clean Coal Electricity NSPS Comments: June 25, 2012

National Association of Manufacturers NSPS Comments: June 25, 2012

WI Department of Natural Resources NSPS Comments: June 22, 2012

 


ECONOMIC IMPACT ANALYSES

Note: Certain studies noted below were based on anticipated EPA proposals and may not reflect the contents of published proposals.

Ventures Analysis: Energy Market Impacts of Recent Federal Regulations on the Electric Power Sector: November 2014.

ERCOT Analysis of the Impacts of the Clean Power Plan: November 2014.

NERC: Potential Reliability Impacts of EPA’s Proposed Clean Power Plant: November 2014.

Remaking American Power: CSIS, October 2, 2014.

MISO: GHG Regulation Impact Analysis – Initial Study Results: September 17, 2014.

Hearing with FERC Reveals Uncertainities in EPA’s Power Plant Rule: July 30, 2014.

National Hydro Association: Hydropower and the EPA Section 111(d) Proposal: August 12, 2014.

GAO: EPA Should Improve Adherence to Guidance for Selected Elements of RIA: July 2014.

The Brattle Group: EPA’s Proposed Clean Power Plan: Implications for States and the Electric Industry: June 2014.

NAVIGANT Economics: Markets Matter: Expect a Bumpy Ride on the Road to Reduced CO2 Emissions: May 2014.

American Action Forum: An Inside Look at GHG Regulation: June 4, 2014.

Brookings: Determining the Proper Scope of Climate Change Benefits:June 3, 2014

Recent assessments of climate change policies have shifted to a worldwide benefits approach, leading to a substantial increase in the estimated benefits. In 2010 the Obama Administration’s Interagency Working Group on Social Cost of Carbon developed the guidelines that provide the basis for the assessment of the benefits associated with reductions in carbon dioxide emissions. Based on the estimates in one integrated assessment model that permitted a U.S. analysis, the estimate of the average U.S. benefit is about 7 to 10 percent of the global benefit. Alternatively, if one does not rely on a direct benefit estimate but assumes that the domestic share of the benefits is proportional to the current U.S. share of the global GDP, then the domestic benefit is 23 percent of the global benefit.

EPA: Regulatory Impact Analysis for the Proposed Carbon Pollution Guidelines for Existing Power Plants and Emission Standards for Modified and Reconstructed Power Plants: June 2, 2014

This Regulatory Impact Analysis (RIA) discusses potential benefits, costs, and economic impacts of the proposed Emission Guidelines for Greenhouse Gas Emissions from Existing Stationary Sources: Electric Utility Generating Units. The estimated annual costs of the proposed action are between $5.4 and $7.4 billion in 2020 and between $7.3 and $8.8 billion in 2030 for the primary Option (Option 1). The alternative option (Option 2) has annual estimated costs of between $4.2 and $5.4 billion in 2020 and between $4.5 and $5.5 billion in 2025 (All in $2011 not including monitoring, reporting, or record-keeping costs).

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U.S. Chamber of Commerce Institute for 21st Century Energy: Assessing the Impact of Proposed New Carbon Regulations in the United States: May 28, 2014

These rules threaten to suppress average annual U.S. Gross Domestic Product (GDP) by $51 billion and lead to an average of 224,000 fewer U.S. jobs every year through 2030, relative to baseline economic forecasts.

American Coalition for Clean Coal Electricity Impacts of System Based Approach: March 21, 2014

NERA Economic Consulting: A Carbon Dioxide Standard for Existing Power Plants: Impacts of the NRDC Proposal (Slides): March 2014

The Heritage Foundation: EPA’s Climate Regulations Will Harm American Manufacturing: March 4, 2014

Manufacturing is an energy-intensive industry, and the impact of the higher energy prices on manufacturing averages to more than 770 jobs losses per congressional district. However, not all regions are affected the same, as districts in Wisconsin, Ohio, Indiana, Michigan, and Illinois are especially hit hard. In fact, 19 out of the top 20 worse off congressional districts from the Administration’s war on coal are located in the Midwest region. In those districts, the manufacturing industry, on average, will slash more tan 1,600 jobs by 2023.

ACCCE: Recent Electricity Price Increases and Reliability Issues Due to Coal Plant Retirements: Feb. 2014

The Heritage Foundation: EPA Power Plant Regulations: A Backdoor Energy Tax: Dec. 5, 2013

Heritage Foundation analysts modeled the effects of what killing coal would do to our economy. Using the Heritage Foundation Energy Model and analyzing a phase-out of coal between 2015 and 2038, by the end of 2023: employment falls by nearly 600,000 jobs; manufacturing loses over 270,000 jobs; coal-mining jobs drop 30 percent; a family of four’s annual income drops more than $1,200 per year, and its total income drops by nearly $24,400 over the entire period of analysis; and aggregate gross domestic product (GDP) decreases by $2.23 trillion over the entire period of the analysis.

EPA: Regulatory Impact Analysis for the Proposed Standards of Performance for GHG Emissions for New Stationary Sources: Electric Utility Generating Units: Sept. 2013

This Regulatory Impact Analysis (RIA) discusses potential benefits, costs, and economic impacts of the proposed Standards of Performance for Greenhouse Gas Emissions (GHG) for New Stationary Source: Electric Generating Units (EGU). The EPA anticipates that the proposed EGU New Source GHG Standards will result in negligible CO2 emission changes, energy impacts, quantified benefits, costs, and economic impacts by 2022. Accordingly, the EPA also does not anticipate this rule will have any impacts on the price of electricity, employment or labor markets, or the US economy.

Find more information here


LEGAL ANALYSES

The Oklahoma Attorney General’s Plan: The Clean Air Act Section 111(d) Framework that Preserves States’ Rights: April 2014.

Troutman Sanders: Why EPA’s “Clean Power Plan: Is Legally Invalid.

Potts & Zoppo: EPA’s Clean Power Play: Who Needs Congress?: June 10, 2014.

M. J. Bradley & Associates LLC: Structuring Power Plant Emissions Standards Under Section 111(d) of the CAA – Standards for Existing Power Plants: Oct. 2013.


SOCIAL COST-BENEFIT OF CARBON ANALYSES

Management Information Services, Inc.: The Social Cost of Carbon? No, The Social Benefits of Carbon: Jan. 2014

Loaded DICE: An EPA Model Not Ready for the Big Game: Nov. 21, 2013

Interagency Working Group on Social Cost of Carbon, U.S. Gov.: Technical Update of the Social Cost of Carbon for Regulatory Impact Analysis Under Executive Order 12866: May 2013

Johnson and Hope: The Social Cost of Carbon in U.S. Regulatory Impact Analyses: an Introduction and Critique: Sept. 12, 2012


OTHER

WI DNR & PSC ESPS Presentations: Pat Stevens & Commissioner Nowak, September 2014.

EPA’s Clean Power Plan: Is It Legal: Brian Potts Foley & Lardner, September 9, 2014.

CNEE: A State Planning Guide for Clean Air Act Section 111(d)

EPA’s Clean Power Plan: States’ Tools for Reducing Costs and Increasing Benefits to Consumers

Clean Power Plan: MISO Analysis Update to ERSC, August, 12, 2014.

U.S. Chamber: The Value of US Power Supply Diversity: July 25, 2014.

Six Major Myths About EPA’s Proposed Carbon Regulations

EPA Emission Regulation Surveys 6/12/14: Magellan Strategies

Coal Facts

Coal Unit Shutdowns

Family Energy Costs 2001 – 2014

Energy Cost Impacts on American Families, 2011-2014

State Energy Costs for Families

Major EPA Regulations Affecting Coal-Fired Electricity

Impacts of “Outside-the-Fence” Proposals

“Climate Effects” of Carbon Regulations for the U.S. Electric Sector

Bureau of Labor Statistics: Share of Total Employment in Manufacturing

Energy Information Administration: Coal Use in Electric Power Sector by Region (Graphs)

DOE Official: Initial CCS Technologies Estimated to Increase Wholesale Electricity Costs Up to “70 to 80 Percent.” (VIDEO): Feb. 11, 2014

American Coalition for Clean Coal Electricity The Effect of EPA’s Proposed NSPS on Carbon Capture and Storage Technology: Sept. 2013

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