The American Public Power Association recently submitted comments in response to a proposal by the U.S. Environmental Protection Agency to repeal greenhouse gas emissions standards for the power sector.
The EPA this summer announced its proposal to repeal the 2024 Carbon Pollution Standards that regulate greenhouse gas emissions from existing and new power plants.
The Proposed Rule offers two approaches to repealing or revising the 2024 GHG Standards.
The first approach is EPA’s “Primary Proposal.” The Primary Proposal would repeal the 2024 GHG Standards in their entirety based on a finding that GHG emissions from the covered electric generating units (EGU) source category do not significantly contribute to endangerment of public health and welfare.
If finalized, the Primary Proposal would also have the effect of repealing all regulations of GHG emissions from fossil fuel fired power plants. Which include EGUs regulated under 40 C.F.R Part 60, Subpart UUUUb, Subpart TTTT and Subpart TTTTa and all associated rulemakings, including the 2015 new source performance standards (NSPS) and the 2024 GHG Standards.
The second option is EPA’s “Alternative Proposal.”
The Alternative Proposal would repeal the 2024 GHG Standards for existing fossil fuel fired power plants in Subpart UUUUb based on changes to EPA’s best system of emission reduction (BSER) determinations. Further the Alternative Proposal would repeal the Phase II GHG Standards for new, modified and reconstructed power plants at Subpart TTTTa for base load natural gas fired combustion turbines. But retain the NSPS for low and intermediate load combustion turbines (CT) and the Phase 1 base load CT limits.
APPA Comments
Demand for electricity is increasing rapidly, and this is forecast to continue for the foreseeable future. Public power utilities need immediate relief from the 2024 GHG Standards to ensure that they will be able to continue providing reliable and affordable electricity to their customers, APPA said.
APPA and others, including regional transmission organizations (RTOs) that are responsible for grid reliability, told EPA during the rulemaking for the proposed 2024 GHG Standards that the standards would threaten electric reliability, would increase health and safety concerns, result in increased electricity costs, and potentially undermine public support for prudent GHG reducing programs. EPA finalized the 2024 GHG Standards despite these serious concerns, APPA said.
The North American Electric Reliability Corporation’s recent Long-Term Reliability Assessment predicts massive increases in electricity demand over the next ten years and contains warnings regarding “critical reliability challenges.”
APPA said that the 2024 GHG Standards will compound these reliability issues because they will lead to the early retirement of coal-fired generation and because they impose capacity factor limitations on new, larger combined cycle combustion turbines.
The 2024 GHG Standards are already having an adverse effect on the ability of electric generators to construct new base load generation to meet increased demand, APPA argued.
APPA urged the EPA to finalize the Alternative Proposal, which if coupled with the revisions needed to the NSPS for new base load combustion turbines in Phase 1 and for intermediate combustion turbines discussed in the comments, provide needed relief to the power industry.
APPA went on to say that the portions of the 2024 GHG Standards that reply on a best system of emissions reduction (BSER) of 90 percent carbon capture and storage (CCS) do not comply with the requirements of section 111 of the CAA, and EPA properly proposes to repeal them.
EPA properly proposes to find that CCS is not adequately demonstrated at stationary combustion turbines, APPA said.
The two projects EPA cited in the 2024 GHG Standards to support its determination that CCS was adequately demonstrated actually support the opposite conclusion, APPA argued.
The Bellingham Energy Center was a slipstream facility that is not comparable to EGUs, and the Peterhead Power Station in Scotland is not yet operational. Other projects cited by EPA are not operational (or not even constructed), APPA pointed out.
EPA properly proposes to find that CCS is not adequately demonstrated for steam generating units, APPA said.
EPA relied primarily on the Boundary Dam Unit 3 project, which has never demonstrated 90 percent capture of carbon dioxide (CO2) and which is a relatively small power plant of only 110 megawatts (MW).
Other projects cited by EPA are small, capture CO2 from a slipstream, do not capture CO2 at a 90 percent level, and/or received federal funding that disqualifies it from consideration as a BSER. EPA also cited unconstructed projects and vendor statements, neither of which can support a BSER determination.
APPA said that EPA properly proposes to find that the NSPS and presumptive standards of performance that are based on a 90 percent CCS BSER are not achievable.
No commercial EGU has ever achieved 90 percent CCS on a sustained basis, as the 2024 GHG Standards require, and EPA did not cite a single example of a facility meeting this standard in the final 2024 GHG Standards, APPA noted.
Other reasons also support EPA’s determination that CCS is not achievable, including the infrastructure needed for CCS, including pipelines and storage facilities, does not exist, and it cannot be constructed by the compliance deadlines in the 2024 GHG Standards, and many areas of the country do not have convenient access to geologic storage for CCS.
APPA said that EPA properly proposes to find that CCS is not cost-effective. In past rulemakings, the agency previously has consistently rejected CCS as too costly. To get around that problem in the 2024 GHG Standards, EPA inappropriately relied on tax credits, APPA argued.
But tax credits do not reduce the costs of CCS, the trade group said -- they transfer them from power plant owners to taxpayers. Even if tax credits could be taken into account, there are significant limitations on the ability of an owner to obtain them, and nothing would prevent Congress from taking them away, APPA said.
Many other obstacles exist that prevent CCS from being considered as a “best” system to reduce GHG emissions from EGUs, including: (1) geographic and site limitations; (2) water constraints; and (3) parasitic load, APPA went on to say.
The portion of the 2024 GHG Standards that identifies co-firing with 40 percent natural gas as the BSER for existing medium-term coal-fired steam generating units does not comply with section 111 of the CAA, and EPA properly proposes to repeal it, APPA said.
Requiring a coal-fired EGU to become a “hybrid” plant that burns 40 percent natural gas constitutes impermissible generation shifting and is beyond EPA’s authority, the comments said.
Even if fuel switching were permissible, which it is not, the presumptive emission limit based on 40 percent co-firing is not achievable because the majority of coal plants do not have access to natural gas, and the vast majority of those plants that do have access to gas use it only at very low levels for boiler startup or to hold the unit in “warm standby,” APPA said.
And co-firing with 40 percent natural gas is not cost-effective because of the need to construct expensive pipeline infrastructure.
APPA said that EPA properly proposes to repeal the requirements for existing natural gas- and oil-fired steam generating units because these requirements would result in only de minimis -- if any -- emission reductions but would impose significant requirements on states to develop state plans. These standards are not necessary, in any event, because they are based on what those sources are already doing (i.e., business as usual).
APPA argued that the major questions doctrine also supports EPA’s Alternative Proposal.
It said that the 2024 GHG Standards did not remedy the legal deficiencies identified by the U.S. Supreme Court in West Virginia v. EPA. Although the 2024 GHG Standards do not require overt generation shifting (with the exception of the 40 percent gas co-firing requirement), they lead to the same result because they are based on technology that is not adequately demonstrated, require compliance with rates that are not achievable, and are not cost-effective.
APPA said that EPA needs to reconsider the CO2 emission standards for new base load combustion turbines in Phase 1 and the standards for intermediate load combustion turbines, and APPA urged the Agency to do so in supplemental rulemaking.
APPA asserted that the existing intermediate load standards are unachievable by even highly efficient turbines, and because the standard is based on a single set of operating parameters, it effectively dictates the types of operations and particular uses of the turbine, which is impermissible under the CAA.
Even if operational constraints can be the basis of the BSER, EPA should have established a significantly higher standard for this subcategory, it said.
APPA said the current Phase 1 NSPS for the base load subcategory is deeply flawed because it is unachievable by a number of highly efficient turbines on the market, adding that EPA based the standard on only one unit that is not representative of the variety of highly efficient combustion turbines that are available on the market.
Even if operational constraints can be the basis of the BSER, the Agency should have established a significantly higher standard for this subcategory, EPA was told.
EPA’s selection of an annual capacity factor of 40 percent as the dividing threshold between simple-cycle combustion turbines and combined-cycle combustion turbines should be eliminated or revised upwards, APPA added.
Combustion turbines operating above a capacity factor of 20 percent should be subcategorized based on their mode of operation (simple cycle and combined cycle) and not on the basis of their utilization.
If EPA retains the current intermediate load and base load subcategories, then the demarcation between the two subcategories needs to be increased.
Although APPA believes the Alternative Proposal offers a more certain and durable option, APPA also offered comments on the Primary Proposal for EPA’s consideration in the event EPA decides to finalize it, perhaps after it finalizes the Alternative Proposal.
APPA said that before listing a new source category under section 111, EPA must find that the category significantly contributes to endangering air pollution.
