‹ Analysis & Projections

Annual Energy Outlook 2012

Release Date: June 25, 2012   |  Next Early Release Date: December 5, 2012  |   Report Number: DOE/EIA-0383(2012)

Legislation AEO 2011Legislation and regulations

2012

Introduction

1. Greenhouse gas emissions and fuel consumption standards for heavy-duty vehicles, model years 2014 through 2018
On September 15, 2011, the EPA and NHTSA jointly announced a final rule, called the HD National Program [9], which for the first time established GHG emissions and fuel consumption standards for on-road heavy-duty trucks with a gross vehicle weight rating (GVWR) above 8,500 pounds (Classes 2b through 8) [10] and their engines. The AEO2012 Reference case incorporates the new standards for heavy-duty vehicles (HDVs).

2. Cross-State Air Pollution Rule
The CSAPR was created to regulate emissions of sulfur dioxide (SO2) and nitrogen oxides (NOx) from power plants greater than 25 megawatts that generate electric power from fossil fuels. CSAPR is intended to assist States in achieving their National Ambient Air Quality Standards for fine particulate matter and ground-level ozone. Limits on annual emissions of SO2 and NOx are designed to address fine particulate matter. The seasonal NOx limits address ground-level ozone. Twenty-three States are subject to the annual limits, and 25 States are subject to the seasonal limits [12].

3. Mercury and air toxics standards
The MATS [15] are required by Section 112 of the 1990 Clean Air Act Amendments, which requires that maximum achievable control technology be applied to power plants to control emissions of hazardous air pollutants (HAPs) [16]. The MATS rule, finalized in December 2011, regulates mercury (Hg) and other HAPs from power plants. MATS applies to Hg and hazardous acid gases, metals, and organics from coal- and oil-fired power plants with nameplate capacities greater than 25 megawatts [17]. The standards take effect in 2015.

4. Updated State air emissions regulations
As its first 3-year compliance period came to a close, the Regional Greenhouse Gas Initiative (RGGI) continued to apply to fossil-fuel-fired power plants larger than 25 megawatts capacity in the northeastern United States, despite New Jersey's decision to withdraw from the program at the end of 2011. There are now nine States in the accord, which caps carbon dioxide (CO2) emissions from covered electricity generating facilities and requires each ton of CO2 emitted to be offset by an allowance purchased at auction. Because the program is binding, it is included in AEO2012 as specified in the agreement.

5. California Assembly Bill 32: The Global Warming Solutions Act of 2006
California Assembly Bill 32 (AB 32), the Global Warming Solutions Act of 2006, authorized the CARB to set California's GHG reduction goals for 2020 and establish a comprehensive, multi-year program to reduce GHG emissions in California. As one of the major initiatives for AB 32, CARB designed a cap-and-trade program that started on January 1, 2012, with the enforceable compliance obligations beginning in 2013.

6. State renewable energy requirements and goals: Update through 2011
To the extent possible, AEO2012 incorporates the impacts of State laws requiring the addition of renewable generation or capacity by utilities doing business in the States. Currently, 30 States and the District of Columbia have an enforceable renewable portfolio standard (RPS) or similar laws (Table 4). Under such standards, each State determines its own levels of renewable generation, eligible technologies [26], and noncompliance penalties. AEO2012 includes the impacts of all laws in effect at the end of 2011 (with the exception of Alaska and Hawaii, because NEMS provides electricity market projections for the contiguous lower 48 States only).…

7. California low carbon fuel standard
The Low Carbon Fuel Standard (LCFS), administered by the CARB [36], was signed into law in January 2010. Regulated parties under the legislation generally are the fuel producers and importers who sell motor gasoline or diesel fuel in California. The LCFS legislation is designed to reduce the carbon intensity (CI) of motor gasoline and diesel fuels sold in California by 10 percent between 2012 and 2020 through the increased sale of alternative "low-carbon" fuels. Each alternative low-carbon fuel has its own CI, based on life-cycle analyses conducted under the guidance of CARB for a number of approved fuel pathways. The CIs are calculated on an energy-equivalent basis, measured in grams of CO2 equivalent emissions per megajoule.…