[Federal Register Volume 79, Number 5 (Wednesday, January 8, 2014)]
[Proposed Rules]
[Pages 1352-1354]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2013-31079]
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ENVIRONMENTAL PROTECTION AGENCY
40 CFR Part 60
[EPA-HQ-OAR-2011-0660; FRL-9901-51-OAR]
RIN 2060-AQ91
Withdrawal of Proposed Standards of Performance for Greenhouse
Gas Emissions From New Stationary Sources: Electric Utility Generating
Units
AGENCY: Environmental Protection Agency (EPA).
ACTION: Withdrawal of proposed rule.
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SUMMARY: The United States EPA (EPA) is withdrawing the proposal for
new source performance standards for emissions of carbon dioxide
(CO2), which was published on April 13, 2012, for new
affected fossil fuel-fired electric utility generating units (EGUs).
The EPA received more than 2.5 million comments on that notice and has
received new information, which together necessitates substantial
changes in the proposed requirements. The changes not only affect
determinations of potentially covered sources but could also result in
substantial changes in what some sources must do to comply with the
standards and could thereby cause them to alter planned facility
designs or technological control systems. These changes concern the
addition of a determination of the best system of emission reduction
for fossil fuel-fired boilers and IGCC units; an alternative compliance
option for solid fuel-fired EGUs; the treatment of certain units that
had received permits to construct but for which construction had not
yet commenced; the limits for natural gas-fired stationary combustion
turbines; and the application of CO2 emission fees under the
title V operating permit program. These changes are of substantial
consequence and are sufficient to merit withdrawal (i.e., rescission)
of that notice of proposed rulemaking. At the same time, in a separate
notice of proposed rulemaking published in today's Federal Register,
the EPA is issuing new proposed requirements for new fossil-fuel-fired
electric generating units, which are based on different analyses from
the original proposal and would establish requirements that differ
significantly from the original proposal.
DATES: The proposed rule published on April 13, 2012 (78 FR 22392), is
withdrawn as of January 8, 2014.
ADDRESSES: Docket: A rulemaking docket for the April 13, 2012, notice
of proposed rulemaking was established and identified as EPA-HQ-OAR-
2011-0660. All documents in the docket are listed in the http://www.regulations.gov index. Although listed in the index, some
information is not publicly available (e.g., CBI or other information
whose disclosure is restricted by statute). Certain other material,
such as copyrighted material, will be publicly available only in hard
copy. Publicly available docket materials are available either
electronically at http://www.regulations.gov or in hard copy at the EPA
Docket Center, EPA West, Room 3334, 1301 Constitution Ave. NW.,
Washington, DC. The Public Reading Room is open from 8:30 a.m. to 4:30
p.m., Monday through Friday, excluding legal holidays. The telephone
number for the Public Reading Room is (202) 566-1744, and the telephone
number for the Air Docket is (202) 566-1742. Visit the EPA Docket
Center homepage at http://www.epa.gov/epahome/dockets.htm for
additional information about the EPA's public docket.
In addition to being available in the docket, an electronic copy of
this action will also be available on the Worldwide Web (WWW) through
the Technology Transfer Network (TTN). Following signature, a copy of
the action will be posted on the TTN's policy and guidance page for
newly proposed or promulgated rules at the following address: http://www.epa.gov/ttn/oarpg/. The TTN provides information and technology
exchange in various areas of air pollution control.
FOR FURTHER INFORMATION CONTACT: Mr. Christian Fellner, Energy
Strategies Group, Sector Policies and Programs Division (D243-01), U.S.
EPA, Research Triangle Park, NC 27711; telephone number (919) 541-4003,
facsimile number (919) 541-5450; email address:
[email protected] or Dr. Nick Hutson, Energy Strategies Group,
Sector Policies and Programs Division (D243-01), U.S. EPA, Research
Triangle Park, NC 27711; telephone number (919) 541-2968, facsimile
number (919) 541-5450; email address: [email protected].
SUPPLEMENTARY INFORMATION:
I. General Information
A. Overview
In 2009, the EPA issued a finding that greenhouse gas (GHG) air
pollution may reasonably be anticipated to endanger Americans' public
health and welfare, now and in the future, by contributing to climate
change. In the notice of proposed rulemaking that was published on
April 13, 2012 (April 2012 document), the EPA proposed to limit
[[Page 1353]]
GHG emissions from new fossil fuel-fired power plants through standards
for CO2 emissions.\1\ These power plants are the largest
stationary sources of U.S. GHG emissions.
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\1\ In the April 2012 document, we referred to these sources,
interchangeably, as power plants, affected sources, fossil fuel-
fired electric generating units, and electric generating units
(EGUs).
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The April 2012 document proposed federal standards of performance
for new fossil fuel-fired power plants that the EPA concluded could be
met with existing technology. Specifically, the EPA proposed a single
electricity-output-based emission standard of 1,000 pounds of
CO2 per megawatt-hour of gross electrical output (1,000 lb
CO2/MWh) for all new affected fossil fuel-fired power
plants. This standard was based on the demonstrated performance of
recently constructed, modern natural gas combined cycle (NGCC) units,
which the EPA concluded were in wide use throughout the country and
were likely to be the predominant fossil fuel-fired technology for new
generation in the future. Indeed, modeling conducted in support of that
proposal predicted no new coal-fired EGUs would be constructed at least
until after 2020. However, the EPA recognized that a very small number
of new fossil fuel-fired utility boilers and IGCC units may be built,
and if so, they could meet the proposed standard through the use of
available carbon capture and storage (CCS) technology. To assist such
sources in complying with the standard, the EPA proposed an alternative
30-year averaging option that would be available only for affected
coal- and petroleum coke-fired sources complying with the standard
through the use of CCS.
In addition, the EPA identified as ``transitional'' sources certain
coal-fired power plants that had received approval of their PSD
preconstruction permits as of the date of the April 2012 proposal (or
that had approved PSD permits that expired and were in the process of
being extended, if they were participating in a Department of Energy
CCS funding program), and that commenced construction within one year
of the date of the April proposal. For those sources, the EPA did not
propose a standard of performance.
The EPA also stated that it was not proposing standards of
performance for simple cycle combustion turbines or for non-continental
sources (i.e., those in Hawaii or the U.S. territories).
In a separate notice of proposed rulemaking published in today's
Federal Register, the EPA has made several key changes to its original
proposal. First, instead of proposing a single limit covering all
affected fossil fuel-fired EGUs, the EPA is proposing three different
limits: (1) A limit of 1,000 lb CO2/MWh for large natural
gas-fired stationary combustion turbines, (2) a limit of 1,100 lb
CO2/MWh for small natural gas-fired stationary combustion
turbines, and (3) a limit of 1,100 lb CO2/MWh for fossil
fuel-fired utility boilers and IGCC units. Second, instead of proposing
an alternative 30-year averaging compliance option for new solid fuel-
fired EGUs, the EPA is proposing an alternative 7-year (84-operating
month) averaging option and is soliciting comment on a limit of 1,000
to 1,050 lb CO2/MWh. Third, the EPA is no longer excluding
all previously identified transitional sources (but is considering a
subcategory for one to three coal-fired projects that are still
currently under development). Fourth, instead of proposing to exempt
simple cycle combustion turbines, the EPA is proposing to exempt units
that sell to the grid a relatively small portion of their potential
electric output. These exempt units generate less than one-third of
their potential electric output over a three year rolling averaging
period.
B. Why is the EPA withdrawing the proposed rule?
In response to the proposed rule, the EPA received over 2.5 million
public comments on all aspects of its proposal. Many commenters were
supportive of the Agency's proposed actions, other commenters opposed
the proposed actions, and many commenters provided new information and/
or recommended significant changes in the EPA's proposed requirements.
In addition, the EPA has obtained and analyzed new information that
significantly alters its views on important assumptions and which
counsel for major changes in some of the requirements proposed in the
April 2012 document.
We fully describe the actions we are proposing to take in response
to the comments received and the results of our analyses of new
information in a notice of proposed rulemaking published elsewhere in
today's Federal Register. The following is a description of the
principal reasons why those changes warrant rescission of the April
2012 document and issuance of a new proposal.
1. Changes in Proposed Applicability Requirements
Changes to the proposed rule's applicability will impact which
sources are potentially covered. By changing the proposed rule's
applicability, projects based on NGCC technology that are intended to,
and that do, generate less than one-third of their potential electric
output on a three year rolling average, which would have been covered
by the original proposal, are not covered by today's proposal. Such
projects could be beneficial because they are likely to be more
efficient and lower emitting and could potentially cost less than
natural gas-fired simple cycle combustion turbines in some instances.
If we did not withdraw the original proposal, developers might not
consider this technology because they may perceive a greater risk that
we would finalize the applicability requirements of the original
proposal. This could have the unintended effect of potentially stifling
development of NGCC technology that can be used to meet peak energy
demand.
2. Changes With Respect to Proposed Standards
The Agency is also proposing significant substantive changes from
the original proposal in today's new proposal with respect to the
standards themselves.
a. Projected New Coal-Fired Electrical Generating Capacity
In the April 2012 proposal, although the EPA acknowledged the
possibility of a very small amount of construction of new coal-fired
generating capacity, the EPA relied primarily on several modeling
analyses, including analyses using the EPA's Integrated Planning Model
(IPM), which projected that there would be no construction of new coal-
fired generation through the year 2030 without CCS even assuming the
potential for higher future electric demand or with higher future
natural gas prices. Comments received, along with new information, have
brought more clearly into focus the possibility that, in fact, there
could well be limited new coal-fired generating capacity being
constructed within the planning timeframe covered by the proposed rule.
This new capacity could be in response to the need for companies to
establish or maintain fuel diversity in their generation portfolios or
the ability of some companies to combine coal-fired generation of
electricity with the profitable sale of by-products from gasification
or combustion of coal. As a result, even though our baseline analysis
does not project any new coal that would not meet the originally
proposed standard, the EPA believes it is appropriate to develop
separate standards for coal-fired capacity, which, as it turns out,
differ from those for new natural gas-fired EGUs.
[[Page 1354]]
b. Best System of Emission Reduction for Coal-Fired EGUs
The April 2012 proposal set a single standard of performance for
all affected fossil fuel-fired EGUs, regardless of generation
technology or fuel, based on our proposed findings that the best system
of emission reduction adequately demonstrated (BSER) for fossil fuel-
fired units is natural gas combined cycle technology. Thus, in the
April 2012 proposal, we did not propose a separate BSER for coal- and
other solid fossil fuel-fired EGUs, although we identified carbon
capture and storage (or sequestration) (CCS) technology as a compliance
alternative for those EGUs and we proposed a 30-year averaging
compliance option for those EGUs that implemented CCS.
We received significant public comments on this approach. Our
evaluation of those comments has led us to modify significantly our
conclusions regarding the BSER and the resulting emission limitations
for fossil fuel-fired sources, and we no longer consider it appropriate
to propose a single standard for all such units.
Instead, we are proposing separate emission standards based on
separate BSER determinations for (i) fossil fuel-fired utility boilers
and IGCC units and (ii) natural gas-fired stationary combustion
turbines. For fossil fuel-fired utility boilers and IGCC units, we are
proposing partial-capture CCS as the BSER. Additionally, we now believe
that a shorter compliance averaging option than the 30-year scheme
proposed in the April 2012 notice may be more appropriate.
These changes are significant. Moreover, they affect at least one
unit in advanced stages of project development. As a result, the EPA
believes it is important to withdraw the original document, in part to
make it clear to the developer of this project--and any other projects
in development--that their new source performance standards will be
based on a BSER determination that is more closely aligned with
technology appropriate to those projects.
c. Emission Standards for Natural-Gas Fired Stationary Combustion Units
As noted, in the new action, the EPA is proposing separate emission
standards for fossil fuel-fired utility boilers and IGCC units and for
natural gas-fired stationary combustion turbines. In the new proposal,
the EPA also is proposing separate emission standards for smaller
natural gas-fired stationary combustion turbines and for larger natural
gas-fired stationary combustion turbines. This differentiation may be
significant to projects under development.
d. Treatment of Transitional Sources
We received numerous comments objecting to our proposed treatment
of transitional sources. In light of many of those comments and
additional information we have obtained, we have reassessed this issue
and are revisiting our proposed treatment of these types of units.
e. Title V Permit Fees
When EPA finalizes CO2 emission requirements for new
fossil fuel-fired EGUs, GHGs will, for the first time, fall within the
definition of ``regulated air pollutant'' in parts 70 and 71, which
implement the title V permitting program. This would trigger
requirements related to the calculation of permit fees under federal
and state title V operating permit programs. The April 2012 proposal
did not address title V fee issues related to GHG emissions, but we
recognize that it is important to do so. The reproposal addresses title
V fees for GHG emissions and includes several options for calculating
the reasonable costs associated with GHG permitting.
II. Impacts of This withdrawal
The April 2012 document provided estimated air and energy impacts,
as well as projected compliance costs, economic and employment impacts,
and benefits associated with the proposed rule. This action withdraws
the April 2012 proposal, and thus any projected impacts associated with
it are being replaced with the results of a new assessment accompanying
the notice of proposed rulemaking published elsewhere in today's
Federal Register.
III. Statutory Authority
Pursuant to CAA section 307(d)(1)(V), the Administrator is
determining that this action is subject to the provisions of CAA
section 307(d). The statutory authority for this action is provided by
sections 111, 301 and 307(d) of the CAA as amended (42 U.S.C. 7411,
7601 and 7607(d)).
List of Subjects in 40 CFR Part 60
Environmental protection, Administrative practice and procedure,
Air pollution control.
Dated: September 20, 2013.
Gina McCarthy,
Administrator.
[FR Doc. 2013-31079 Filed 1-7-14; 12:45 pm]
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