EPA Delays Proposal of NSPS for GHG Emissions

On June 13, 2011, EPA announced that it has entered into an agreement with the litigants in New York v. EPA to extend the deadline for proposing new source performance standards (NSPS) for greenhouse gas (GHG) emissions from electric generating units (EGUs) from July 26, 2011 until September 30, 2011. In its announcement, EPA stated that it needs more time to evaluate information it received during listening sessions with industry, states, and environmentalists in order to establish "smart, cost-effective, and productive standards." The deadline for EPA to publish the final standard is still May 26, 2012. The effect of EPA's delay in proposing the NSPS is to reduce the amount of time for rulemaking, potentially resulting in a shorter public comment period.

The NSPS will establish the floor for best available control technology (BACT) for reducing GHG emissions from EGUs. In an effort to predict the type of BACT analysis EPA might conduct in the proposed NSPS, it is insightful to examine the EPA-supported BACT analysis in the first two state-issued GHG permits for coal fired power plants. Last month, the Iowa Department of Natural Resources issued a GHG permit to the MidAmerican Energy Company George Neal South power plant. The permit sets an annual carbon dioxide equivalent (CO2e) limit of 6.8 million tons/year and a CO2e limit of 2,588 lbs/MWh for the 640 megawatt plant.  MidAmerican's BACT analysis focused on maximizing efficiency at the plant and does not anticipate significant reductions in GHG emissions from years past. Similarly, the Michigan Department of Environmental Quality has proposed a GHG permit for the 600 megawatt Wolverine Power Supply Cooperative facility with a CO2e limit of 6 million tons/year and an hourly CO2e limit of 2.1 lbs/KWh. The permit's BACT analysis also focused on maximizing efficiency to reduce GHG emissions. The focus on energy efficiency in the state GHG permits suggests that EPA's BACT analysis might also emphasize maximizing efficiency at EGUs as a method for reducing GHG emissions. Attempting to reduce GHG emissions through improved efficiency may be challenging in light of the Utility MACT, however, because pollution control technologies aimed at controlling emissions of NOx and SO2, such as flue gas desulfurization and selective catalytic reduction, reduce EGU efficiency and can be sources of additional GHGs.