Representation
of New Environmental Rules and Regulations
The
reference case for this analysis excludes several potential environmental
actions, such as new regulations affecting regional haze, for
which States are developing implementation plans; the implementation
of new National Ambient Air Quality Standards (NAAQS) for fine
particulates, which is still being reviewed by the U.S. Environmental
Protection Agency (EPA) and the courts; and the possible ratification
of the Kyoto Protocol. In addition, no effort is made to predict
the outcome of ongoing studies of the need to reduce power plant
Hg emissionsa or the resolution of lawsuits against
the owners of coal-fired power plants accused of violating the
Clean Air Act (CAA).
In June 1999, the EPA issued regulations to improve visibility
(reduce regional haze) in 156 national parks and wilderness areas
across the United States. It is expected that these rules will
have an effect on power plants, but the degree to which they will
be affected is not known. Power plant emissions of SO2 and NOx, which contribute to the formation of regional
haze, may have to be reduced to improve visibility in some areas.
The regulations call for States to establish goals and design
plans for improving the visibility in affected areas; however,
State implementation plans (SIPs) are not required until 2004
or later and therefore are not represented in this analysis, because
they have not yet been promulgated.
The revised NAAQS, issued by the EPA in 1997, created a standard
for fine particles smaller than 2.5 micrometers in diameter (PM2.5).
As with regional haze, power plant emissions of SO2 and NOx are a component of fine particulate emissions.
At the request of the President (memorandum July 16, 1997), the
EPA is now reviewing scientific data on fine particulate emissions
to determine whether to revise or maintain the standard. The review
is expected to be completed in 2002. If the standard is maintained,
States will be required to submit plans to comply by 2005.
In December 1997, 160 countries met to negotiate binding limitations
on greenhouse gas emissions for the developed nations. CO2 emissions from fossil-fired power plants are a key component of
greenhouse gas emissions. The developed nations agreed to limit
their greenhouse gas emissions to 5 percent below the levels emitted
in 1990, on average, between 2008 and 2012. The target for the
United States is 7 percent below the 1990 emission level for all
greenhouse gases. Reductions would be required if the U.S. Senate
ratified the protocol. However, the President has indicated that
the United States will not support the approach called for in
the Protocol. At this time, while 39 countries have ratified the
protocol, only one Annex I (developed) country, Romania, has ratified
the agreement. In addition, various elements of the Protocol are
still under negotiation.
The Clean Air Act Amendments of 1990 (CAAA90), Section 112(n)(1)(A),
required that the EPA prepare a study of hazardous air emissions
from steam generating units. The report was submitted to Congress
on February 24, 1998. Its key finding was that Hg emissions from
coal-fired power plants posed the greatest potential for harm.
The EPA is now collecting and analyzing data on Hg emissions from
specific power plants. The data, together with continuing studies
on the health effects of Hg, will be used to determine the extent
to which emissions need to be reduced. The EPA will be developing
proposed regulations for reducing Hg emissions over the next 3
years.
On November 3, 1999, the Justice Department, on behalf of the
EPA, filed suit against seven electric utility companies, accusing
them of violating CAAA90 by not installing state-of-the-art emissions
control equipment on their power plants when major modifications
were made. CAAA90 requires that when major modifications are made
to older power plants they must also be upgraded to comply with
the emissions standards for new power plants. The EPA is arguing
that the seven companies and the Tennessee Valley Authority made
major modifications to 32 power plants but did not add the required
emissions control equipment. The continued pursuit and outcome
of these cases is uncertain at this time.
aOn December 15, 2000, the EPA announced that Hg emissions need
to be reduced, and that regulations will be issued by 2004.
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