Federal

November 2011 Download this paper (pdf) Press Release CES Resources An Illustrative Framework for a Federal Clean Energy Standard for the Power Sector, November 2011

Written in conjunction with the Regulatory Assistance Project, this discussion paper examines the policy options and implications for a clean energy standard (CES).

Executive Summary:

A transition from conventional fossil fueled electricity generation to clean energy offers several benefits—particularly the growth of new clean energy industries and associated jobs, diversification of energy supply, and reductions in the public health and environmental damages (especially from air pollution) associated with conventional electricity generation.

The current status of clean energy generation depends on how one defines clean energy. While there is no universally agreed upon definition of clean energy in the power sector, various stakeholders endorse some or all of the following as at least partially clean energy options: highly efficient natural gas combined cycle generation; fossil fuel use coupled with carbon capture and storage (CCS); nuclear power; renewables; and electricity savings from energy efficiency and conservation. These generation sources provide about half of U.S. electricity today. While market dynamics and current state and federal policies have led to recent growth in clean energy generation—such as the growth in renewable generation driven in part by state renewable electricity portfolio standards—projections for the power sector indicate that, absent significant new policies to promote clean energy, the status quo in terms of power generation will continue largely unchanged for at least the next quarter century.

Given the benefits of clean energy and the dependence of substantial growth in clean energy generation on new policies, policymakers have lately turned their attention to the idea of a clean energy standard (CES). A CES is a type of electricity portfolio standard that would set aggregate targets for the level of clean energy that electric utilities would need to sell while giving electric utilities flexibility by: (1) defining clean energy more broadly than just renewables, and (2) allowing for market-based credit trading to facilitate lower-cost compliance. As a concept, a CES builds on the successful experience of the majority of states that have implemented renewable and alternative energy portfolio standards and draws on a history of federal policy deliberation regarding national electricity portfolio standards.

States could pursue new CES policies singly or jointly to create multi-state programs. State CES programs could complement existing state renewable portfolio standards, and a CES may be a promising option in states where more narrowly defined renewable electricity policies have had less appeal. A handful of states have already enacted electricity portfolio standards that have many of the attributes of a CES.

The federal government could also enact a national CES. A federal CES has recently received bipartisan support, with several Republican Senators sponsoring federal CES proposals in the last Congress and President Obama endorsing a federal CES in his 2011 State of the Union address. While the prospects for near-term enactment of a federal CES are uncertain, a federal CES has received substantial attention and warrants close consideration by stakeholders.

This paper introduces stakeholders to the concept of a CES, explains how a CES works, describes the benefits that a CES can deliver, and explores federal and subnational options for CES policies. This paper also explores some of the nuances of CES policy design and the implications of different design choices. This discussion can help both state and federal policymakers, utility regulators, and other stakeholders decide whether a CES is an appealing option and to help state stakeholders understand the potential impacts of a federal CES on their states so that they might formulate and communicate federal CES policy design preferences.

Several of the paper’s key points are summarized below.

• Absent significant new policies to promote clean energy, the share of total U.S. electricity generation obtained from clean energy sources will likely not increase by more than a few percentage points over the next 25 years.
• Substantial increases in clean energy generation can offer important benefits, including:
  • Growth of new clean energy industries and associated jobs—e.g., wind turbine manufacturing, solar panel installation, and nuclear power plant construction;
  • Diversification of energy supply to limit electric utilities’ and ratepayers’ exposure to fuel price volatility and regulatory risk associated with particular energy sources;
  • Mitigation of environmental and public health impacts from electricity generation—including criteria and hazardous air pollutants, greenhouse gases emissions that contribute to climate change, and other impacts.
• A CES is a promising policy for spurring a transition to clean energy in the power sector.
  • As a type of electricity portfolio standard, a CES sets requirements for the percentage of electricity sales that must be supplied from qualified clean energy sources and allows electric utilities to demonstrate compliance via tradable credits that they earn themselves for their own generation or buy from other electric utilities or clean energy generators.
  • As a market-based policy, a CES can effectively increase clean energy generation and achieve associated benefits while offering substantial compliance flexibility for electric utilities thus minimizing impacts on electricity consumers.
  • By broadly defining clean energy, a CES provides opportunities for utilities, states, and regions to exploit their unique mix of clean energy options.
  • A CES program can build upon the success of existing electricity portfolio standards that a majority of states have already implemented, provided that the percentage targets are increased in proportion to the potential of newly eligible resources. If additional clean energy resources are allowed to qualify for an existing portfolio standard without increasing the targets, the mix of resources used to meet the standard and the resulting compliance costs may change, but the total amount of clean energy generation will not increase and the goals of the policy may not be furthered.
  • At the state and federal levels, CES policies have attracted bipartisan support, including CES proposals from President Obama and Republicans in Congress.
• CES programs enacted by the federal government or by states singly or in coordination could spur incremental clean energy generation and deliver associated benefits.
  • Federal CES proposals have attracted bipartisan support in previous years, but it is not clear if or when legislation to create a federal CES will move forward.
  • States have already proven themselves to be policy innovators with respect to renewable electricity portfolio standards, and states may seek to reap the benefits of clean energy for themselves by implementing new CES policies—either singly or as part of multi-state programs.
  • At least four states (Michigan, Ohio, Pennsylvania, and West Virginia) already have electricity portfolio standards that credit cleaner, non-renewable energy sources, and Indiana has a similar but voluntary program. These states offer several lessons for future state or federal CES programs, including:
    • Utilities tend to comply with electricity portfolio standards by deploying the lowest-cost qualified resources, so policymakers may need to include special provisions in a CES if they hope to provide a meaningful incentive for less commercially mature and higher-cost technologies.
    • Policymakers can design CES programs that have very modest impacts on electricity rates.
    • A combination of factors—including the policy’s target and the types of energy sources that qualify—determine how much incremental clean energy generation a CES program will deliver beyond “business as usual,” and policymakers should consider the interaction of such factors in developing a CES to ensure the program can meet their goals for additional clean energy generation.
• The net effects of a CES policy are a function of interrelated policy design decisions. Policymakers and stakeholders should understand CES policy design options and their interactions and implications. Policymakers and stakeholders might usefully evaluate a CES in terms of key criteria and think about implications of different policy design decisions in light of these criteria.
  • Effectiveness – What is the magnitude of the policy’s desired impacts?
    • CES targets set the requirements for overall clean energy generation.
    • The degree to which a CES delivers the benefits associated with clean energy depends on how policymakers define qualified clean energy under the program.
    • Certain policy design options (e.g., exemptions for certain utilities and alternative compliance payments) can have the effect of reducing a CES program’s effective target for incremental clean energy deployment.
    • Policymakers may include provisions in a CES to provide particular incentives to certain technologies—e.g., less commercially mature or higher cost ones—in order to reap particular clean energy-related benefits.
  • Cost-effectiveness – how efficiently does the policy achieve its intended aims?
    • As a market-oriented policy, a CES is an inherently cost-effective program.
    • Policymakers have several options for providing electric utilities with compliance flexibility under a CES (e.g., banking and borrowing of credits).
    • In general, the more flexibility that utilities have for meeting clean energy targets (e.g., the more broadly clean energy is defined), the more cost-effective a CES program will be.
  • Fairness – does the policy lead to any undue burdens or unearned windfalls for particular utilities, power generators, or regions and customers?
    • Owing to a variety of factors, different electric utilities supply their customers with electricity from widely varying existing generation mixes. In addition, utilities, states, and regions have different cost-effective options for increasing clean energy generation (e.g., because of different renewable resource endowments).
    • How policymakers set CES targets, treat new vs. existing clean energy generators, and define qualified clean energy sources determine how the effects of a CES program vary among different utilities, power generators, or customers.

What are the cooling water intake structure rules?

Many power plants and manufacturing facilities use water from nearby sources, such as lakes and rivers, to produce steam to generate electricity, or to cool high-temperature machinery. Cooling water intake may take the form of a once-through system, in which water enters a facility, is used for cooling, and then is sent directly back into the water body. Another form is closed-cycle cooling, often in the form of cooling towers, where water is recirculated several times in the facility, thereby using only two to five percent the amount of water required for once-through cooling.

Large amounts of water many used for these cooling purposes, and the intake structures for water may have adverse environmental impacts. One significant problem is impingement, where fish or other animals are trapped against and mortally wounded by intake structures. Another environmental problem is entrapment, where animals, especially small organisms, eggs, and larvae, are sucked into the facility and killed by high pressures and temperatures.

Sec. 316(b)  of the Clean Water Act (CWA) requires that the location, design, construction, and capacity of cooling water intake structures reflect the best technology available for minimizing these adverse environmental impacts.

EPA has proposed a new rule complying with these mandates of the CWA for existing facilities. New facilities are not covered by this rule and remain subject to applicable 2001 cooling water intake regulations. The new rule has three main components. The first component is to establish a limit to the number of fish that can be killed by impingement at a facility and allow the facility to determine what technology to use to meet that standard. The second component applies only to the largest consumers of water (more than 125 million gallons per day), and they must undertake an evaluation, with public comment, on if reductions in the entrapment rate need to be made. The third component requires all new construction of intake structures that are part of increased electric generating capacity to meet the low rates of entrapment achieved by closed-closed cycle intake structures.

Who are the covered entities?

This new rule on cooling water intake structures would cover about 1,260 existing facilities that each withdraw at least 2 million gallons per day of cooling water (670 power plants and 590 manufacturing plants). EPA estimates that nearly 60 percent these facilities already employ technologies that are likely to comply with the impingement requirements of the rule. Manufacturers of aluminum, iron, steel, petroleum, paper, chemicals, and food processing are likely to be the most affected by this rule.

What is the status of regulation?

EPA first promulgated regulations to implement Sec. 316(b) in 1976 following mandates of the Clean Water Act, but the court remanded those regulations in 1977 after legal challenges from industry. Instead of issuing new rules, EPA undertook relevant studies and directed state permitting authorities to determine the best technology available to reduce impingement and entrapment on a case-by-case basis.

In 1995, EPA entered into a consent decree establishing a schedule for taking final action on regulations following litigation. In November 2001, EPA finalized regulations for new facilities, which it referred to as Phase I of the regulations. Phase II of the regulations, released in 2004, applied to certain power plants built before 2002 – those that withdrew more than 50 million gallons per day from waters of the United States, 25 percent of which was used for cooling purposes. In 2006 offshore oil and gas facilities were given a categorical exclusion from additional rules, which essentially subjected them to the same regulation as Phase I facilities.

This regulation is considered to be the last set following the consent decree, Phase III, and the proposed rule was issued in April 2011 with the public comment period lasting through August 2011. According to a modified settlement agreement, the final rules must be issued in June 27, 2013.

Read more from EPA on cooling water intake structures.

What are the coal ash disposal (coal combustion residuals disposal) rules?

The residuals of coal combustion in power plants that are captured by pollution control technology, such as scrubbers, are often referred to as coal ash. The waste includes fly ash, bottom ash, boiler slag, flue gas desulfurization gypsum, and other byproducts and contains low concentrations of arsenic, selenium, lead, and mercury. After collection at a power plant, coal ash is often impounded in a surface storage pond or in a landfill.

Like other waste products, coal ash is governed under the Resources Conservation and Recovery Act  (RCRA) and is currently considered to be a non-hazardous waste under that law. Through a rulemaking process, EPA is considering whether this designation should be changed.

Who are the covered entities?

Coal-fired power plants in the U.S. produced 136 million tons of coal ash in 2008. Fifty-five percent of that total was disposed of in 584 landfills or surface impoundments nationwide. However, coal ash has some useful purposes; 45 percent of the waste is now recycled into products like concrete and bricks and as filler for abandoned mines and highway berms. New coal ash disposal regulations would affect the 60 million tons of coal ash annual that is disposed of and not recycled, reused, or reclaimed.

What is the status of regulation?

EPA decisions in 1993 and 2000 determined that coal ash should be regulated as a non-hazardous waste under Subtitle D of RCRA, the same classification as household garbage and other nonhazardous industrial wastes. EPA develops guidelines to assist in planning, managing, and implementing disposal of these wastes, although state and local agencies take primary responsibility. 

The classification of coal ash as non-hazardous waste has been challenged by recent events. In December 2008, a dam holding a wet storage pond of coal ash from power plants broke in Kingston, Tennessee, spilling about one billion gallons of coal ash-polluted water over 300 acres into the nearby community and waterways. Another spill in October 2011 sent coal ash-polluted water into Lake Michigan. These accidents, along with long held concerns about leaching of pollutants from impoundments to ground water, have led to some advocates to call for a designation as a hazardous waste under RCRA, and EPA proposed rulemaking on the issue in June 2010.

The EPA proposed and sought comment on two options, neither of which would apply to coal ash that is recycled or reused into other products. The first option would classify coal ash as a “special waste” under Subtitle C of RCRA. Ultimately, this designation would require regulations for the generation; transportation; and treatment, storage or disposal of coal ash, along with related compliance and enforcement programs. The second option would be to continue the treatment of coal ash as a non-hazardous waste under Subtitle D of RCRA but also establish minimum requirements for storage. Under both proposals, EPA would establish dam safety requirements to address the structural integrity of surface impoundments to prevent major releases, like those seen recently in Tennessee and Wisconsin.

EPA offered five months of public comment and a year of data collection on these proposals and received over 450,000 comments, and announced that it would delay final decision-making until an unnamed future date. In response, Earthjustice, on behalf of eleven other organizations, announced its intent to sue EPA to conclude its rulemaking. The lawsuit must be filed within 60 days of its January 11, 2012 notice date. EPA has stated that it will finalize revisions to the definition of solid waste by December 2012.

In October 2011, the House of Representatives passed legislation, H.R. 2273, the "Coal Residuals Reuse and Management Act," that would prohibit EPA from regulating coal ash as hazardous waste. While there is companion legislation in the Senate, S. 1751, it is unlikely to advance in the upper chamber.

Read more from EPA on coal ash disposal.

What is the Cement MACT?

(National Emissions Standards for Hazardous Air Pollutants for Portland Cement Plants)

The Clean Air Act requires the Environmental Protection Agency (EPA) to regulate hazardous air pollutants, through the National Emissions Standards for Hazardous Air Pollutants program established in Sec. 112 of the Act. EPA must identify sources of the 188 hazardous air pollutants (HAPs) listed in Sec. 112(b), including acid gases, asbestos, dioxin, benzene, chlorine, lead compounds, mercury, phosphorus, various metals and others. Major sources of these pollutants are those that emit 10 tons per year of a single HAP or 25 tons per year or more combined of several HAPs.

EPA promulgates technology-based standards for reducing HAP emissions using maximum achievable control technology (MACT) for both new and existing sources. Determination of the MACT considers a number of factors, including cost, energy requirements, and non-air quality health and environmental impacts. The Act established certain stringency requirements for MACT for new sources, known as "floor" requirements. Existing sources are also subject to MACT, which may be less stringent than the MACT for new sources, but must not be less stringent than the best-performing 12 percent of existing sources in the same category. EPA has recently established new MACT requirements for Portland cement manufacturing plants.

As with some other Act programs, the Federal government establishes and state air quality programs implement NESHAP programs.

Who are the covered entities?

Starting in 1990 and revised every eight years thereafter, EPA determines a list of categories and subcategories of sources of HAPs. The cement manufacturing source category was added in 1999 based on emissions of arsenic, cadmium, beryllium, lead, and polychlorinated biphenyls. Emissions standards issued in 2010 include limits on emissions of mercury, hydrocarbons, particulate matter, and hydrochloric acid. There are 97 cement manufacturing facilities across all regions of the United States. EPA estimates that twenty new facilities may be built in the five years following promulgation of the rule and would, therefore, be subject to the new regulations.

What is the status of regulation?

The MACT for cement manufactures was issued in 1999, but it did not include standards for hydrochloric acid, mercury, total hydrocarbons and metal HAPs. This absence became the basis for litigation against EPA, and in 2000, the courts ordered EPA to set standards for those HAPs. Based on this court action, a new rule with standards for those HAPS was promulgated in December 2006 for new and existing cement plants. EPA separately announced at that time that it was reconsidering the emissions standards set for new plants in response to public comment, and that revision was completed as a final rule in September 2010. On February 12, 2013, EPA issued a final MACT and NSPS rule for cement plants that made modifications to the 2010 rule. The new rule extended the compliance period from 2013 to 2015, changed the way particulate matter emissions are monitored, and made other changes.

Read more from EPA on the Cement MACT.

What are New Source Performance Standards (NSPS)?

The Clean Air Act requires the Environmental Protection Agency (EPA) to regulate pollution from new, modified and reconstructed facilities through the New Source Performance Standards (NSPS) program, established in Sec. 111 of the Act. NSPS are technology-based standards which apply to specific categories of stationary sources. The new standards lower the amount of particulate matter (PM), sulfur dioxide (SO2), and dioxides of nitrogen (NOx) that can be emitted. Under Sec. 111(b), EPA must establish performance standards for new and modified sources. An NSPS requires facilities to attain an emissions level that "reflects the degree of emissions limitation achievable through the application of the best system of emissions reduction which (taking into account the cost of achieving such reduction and any nonair quality health and environmental impact and energy requirements) the Administrator determines has been adequately demonstrated." In setting this performance standard, EPA has some discretion to distinguish among classes, types, and sizes within source categories. However, the limit EPA sets must take the form of a standard and may not prescribe a particular technology itself. Under the law, EPA is to review the technological options available for emissions reduction and, if appropriate, establish a new standard every eight years. In practice, standards remain in place for longer than eight years.

As with some other Act programs, the Federal government establishes and state air quality programs implement NSPS programs.

Who are the covered entities?

The Cement NSPS will set new standards of emissions for any new cement manufacturing plants (kilns or clinker coolers) or major modification to any of the 97 existing cement manufacturing facilities in all regions of the United States. Emissions standards issued in 2010 include limits on emissions of mercury, hydrocarbons, particulate matter, and hydrochloric acid. EPA estimates that twenty new facilities may be built in the five years following promulgation of the rule and would, therefore, be subject to the new regulations.

What is the status of regulation?

The first NSPS for cement plants was issued in 1971, and reviews were made twice in 1974 and once in 1988. This most recent review was started as a proposed rule in June 2008 under the Bush Administration. EPA finalized the new NSPS in September 2010 as a joint rulemaking with a new MACT for cement plants. On February 12, 2013, EPA issued a final MACT and NSPS rule for cement plants that made modifications to the 2010 rule. The new rule extended the compliance period from 2013 to 2015, changed the way particulate matter emissions are monitored, and made other changes.

Read more from EPA on Cement NSPS.

What are the National Ambient Air Quality Standards (NAAQS) for Ozone?

The Clean Air Act requires the Environmental Protection Agency (EPA) to set national ambient air quality standards for six “criteria” air pollutants, including ground-level ozone (O3), as mandated by Sec. 110 of the Act. Ozone, which is the main component of smog, is created by the reaction of oxides of nitrogen (NOx) and volatile organic compounds (VOCs) in the presence of sunlight. While solar radiation-blocking ozone is beneficial in the upper atmosphere, its presence near ground-level has adverse environmental and public health effects, such as pulmonary and cardiovascular ailments, including asthma and decreased lung function.

In the NAAQS program, two standards are required for ozone and the other criteria pollutants. Primary standards set limits to protect public health, including the health of "sensitive" populations such as asthmatics, children, and the elderly. Secondary standards set limits to protect public welfare, including protection against visibility impairment, damage to animals, crops, vegetation, and buildings. For ozone, the primary and secondary standards are determined to be at the same level of ozone parts per billion (ppb). EPA has established ozone standards that are not to be exceeded in eight-hour periods and one-hour periods. These ozone standards are subject to review every five years through a public process that includes public and industry stakeholders and a Clean Air Scientific Advisory Committee (CASAC).

Who are the covered entities?

Rather than applying to specific facilities or vehicles that emit ozone, NAAQS apply to geographic areas. Jurisdictions must have air quality that meets all the NAAQS. Jurisdictions are in judged to be in “attainment” if they meet the standards, or “nonattainment,” if they fail to. Once a jurisdiction is ruled to be in nonattainment, the state and local governments have three years to develop implementation plans outlining how areas will attain and maintain the standards by reducing air pollutant emissions contributing to ozone concentrations. These implementation plans can affect the types of pollution controls required for power plants and manufacturing facilities, as well as motor vehicle emissions testing requirements.

A nonattainment area with improved air quality will become a “maintenance” area after some years. Failure to improve air quality to meet the standards can result in the imposition of penalties or sanctions by EPA.

What is the status of regulation?

The first ozone NAAQS were established by EPA in 1971 after the Clean Air Act entered into law. Initially, hundreds of jurisdictions were judged to be in nonattainment, but the subsequent implementation plans lead to attainment for many jurisdictions and healthier air quality. In 1979 and 1997, those standards were gradually strengthened, causing a temporary increase in the numbers of nonattainment areas.

The most recent ozone NAAQS of 75 ppb was established in 2008 under the Bush Administration. In response to a legal challenge arguing that the standard did not adequately protect human health as required by law, in January 2010, EPA announced that it would revisit the 2008 standard. It proposed a new standard of between 60 and 70 ppb. The most recent ozone NAAQS of 75 ppb was established in 2008 under the Bush Administration. In response to a legal challenge arguing that the standard did not adequately protect human health as required by law, in January 2010, EPA announced that it would revisit the 2008 standard. It proposed a new standard of between 60 and 70 ppb, and ultimately submitted a standard of 65 ppb to the White House Office of Management and Budget for the last step in the regulatory approval process. In September 2011, President Obama overruled EPA had the EPA Administrator withdraw the proposed final rule. Instead, the President ordered that the ozone standard would be subject to its next scheduled review, set for 2013.

Read more from EPA on ozone NAAQS.

What is the Mercury Rule (National Emissions Standards for Hazardous Air Pollutants for Coal- and Oil- Fueled Electricity Generating Units)?

The Clean Air Act requires the Environmental Protection Agency (EPA) to regulate hazardous air pollutants, through the National Emissions Standards for Hazardous Air Pollutants program established in Sec. 112 of the Act. EPA must identify sources of the 188 hazardous air pollutants (HAPs) listed in section 112(b), including acid gases, asbestos, dioxin, benzene, chlorine, lead compounds, mercury, phosphorus, various metals and others. Major sources of these pollutants are those that emit 10 tons per year of a single HAP or 25 tons per year or more combined of several HAPs.

EPA promulgates technology-based standards for reducing HAP emissions using maximum achievable control technology (MACT) for both new and existing sources. Determination of the MACT considers a number of factors, including cost, energy requirements, and non-air quality health and environmental impacts. The Act established certain stringency requirements for MACT for new sources, known as “floor” requirements. Existing sources are also subject to MACT, which may be less stringent than the MACT for new sources, but must not be less stringent than the best-performing 12 percent of existing sources in the same category. EPA has recently established new MACT requirements for power plants, which leads some to refer to this rule as the “Utility MACT rule.”

As with some other Act programs, the Federal government establishes and state air quality programs implement NESHAP programs.

Who are the covered entities?

Starting with the mandate of the Clean Air Act Amendments of 1990 and then revised every eight years, EPA determines a list of categories and subcategories of sources of HAPs. After Congressionally-mandated EPA studies indicated that other rules were not substantially reducing HAP emissions from coal- and oil-fueled power plants, these plants were determined to be source categories of HAPs in 2000. Mercury is the most significant HAP emitted from coal- and oil-fueled power plants. These power plants are also significant emitters of other carcinogenic HAP metals, such as arsenic, nickel, cadmium, and chromium; HAP metals with potentially serious non-cancer health effect such as lead and selenium; and other toxic air pollutants such as the acid gases hydrogen chloride and hydrogen fluoride. There are 1,325 units at 525 power plants around the United States that will need to comply with the recently announced rule. Some of those power plants are more than fifty years old, and complying with the new regulations will be significantly more challenging and expensive than for newer facilities. Some of these older plants may be retired rather than incur the costs of installing new pollution control equipment.

What is the status of regulation?

After coal- and oil-fueled power plants were determined to be a source category in 2000 and therefore subject to regulation, EPA undertook to regulate mercury from these sources. This Bush Administration rule was known as the Clean Air Mercury Rule (CAMR) and would have instituted a cap-and-trade program for mercury emissions. A court ruled that EPA must regulate HAPs under Sec. 112 and not under another section as proposed in CAMR. It vacated the 2005 rulemaking. EPA’s new Mercury Rule, also known as the Mercury and Air Toxic Standards (MATS), was proposed in March 2011 and scheduled to be finalized in November 2011, although it was delayed until December 12, 2011.

In September 2011, the House of Representatives passed H.R. 2401, the Transparency in Regulatory Analysis of Impacts on the Nation (TRAIN) Act, that would, among other regulations, delay implementation of the Mercury Rule pending completion of additional economic studies (other than those EPA and the Office of Management and Budget have already conducted). This bill is unlikely to advance in the Senate.

On February 16, 2012, Senator Jim Inhofe (R-OK) introduced a Congressional Review Act (CRA) joint resolution to revoke the Mercury Rule. Under CRA procedure, the CRA bill was required to pass both chambers of Congress and be signed by the President to go into effect. The bill was voted down 46 to 53 in the Senate on June 20, 2012.

Read more from EPA on the Mercury Rule.

What is the Boiler MACT Rule (National Emissions Standards for Hazardous Air Pollutants for Industrial, Commercial, and Institutional Boilers and Process Heaters)?

The Clean Air Act requires the Environmental Protection Agency (EPA) to regulate hazardous air pollutants through the National Emissions Standards for Hazardous Air Pollutants program established in Sec. 112 of the Act. This section requires EPA to identify sources of the 188 hazardous air pollutants (HAPs) listed in Sec. 112(b), including acid gases, asbestos, dioxin, benzene, chlorine, lead compounds, mercury, phosphorus, various metals and others. Facilities that emit 10 tons per year of a single HAP or 25 tons per year or more combined of several HAPs are defined as “major sources” under the Act.

EPA promulgates technology-based standards for reducing HAP emissions using maximum achievable control technology (MACT) for both new and existing sources. Determination of the MACT considers a number of factors, including cost, energy requirements, and non-air quality health and environmental impacts. The Act established certain stringency requirements for MACT for new sources, known as “floor” requirements. Existing sources are also subject to MACT, which may be less stringent than the MACT for new sources, but must not be less stringent than the best-performing 12 percent of existing sources in the same category. EPA has recently established new MACT requirements for boilers.

As with some other Clean Air Act programs, the Federal government establishes regulations and leaves it to state air quality programs to implement NESHAP programs.

Who are the covered entities?

Starting after the Clean Air Act Amendments of 1990 and then revised every eight years, EPA determines a list of categories and subcategories of sources of HAPs. In 1998, EPA determined that industrial, commercial, and institutional boilers were sources of HAPs to be regulated because of their emissions of polycyclic organic matter and mercury. These regulations cover: boilers that burn fuels, including natural gas, fuel oil, coal, biomass, refinery gas, or other gas to produce steam that is then used to produce electricity or heat; and process heaters that heat raw or intermediate materials during an industrial process. This rule does not cover units that burn solid waste unless they are otherwise exempt from Clean Air Act  standards for incinerators.

The new “Boiler MACT” rule regulates mercury, hydrogen chloride, particulate matter, carbon monoxide and dioxin/furan emissions from boilers and process heaters. It will affect about 13,840 major source boilers nationwide at industrial facilities and an additional 187,000 area boilers at a variety of smaller businesses and institutions. Major sources will be required to enact work practice improvements and tune ups for natural gas and refinery boilers, and to meet numeric emissions limits for HAPs for other types of boilers. For smaller, “area source” boilers (those that fall below the threshold for major sources), a scaled approach is taken under which boilers have different requirements to meet numeric emissions standards or receive tune ups given their size, age, and fuel type.

What is the status of regulation?

A Boiler MACT was finalized in September 2004.  That regulation, however, was vacated and remanded by a 2007 court decision. EPA issued a revised rule was in March 2011, but then chose to immediately reconsider the rule. A new rule was released for public comment on December 2, 2011 and was finalized on December 20, 2012.

Read more from EPA on the Boiler MACT.