POWER November 2012 - 61

AIR QUALITY
pollution control equipment currently used
by most U.S. coal-fired and gas-fired power
plants will be sufficient to enable them to
comply with the proposed secondary PM2.5
NAAQS. He answered, " I don't think we
know at this point what scale of reductions
will be required to meet the proposed visibility
standards. However, if the 24-hour PM2.5
surrogate policy continues to be in place,
then it would have a limited impact. "
Andrews had no estimates about the costs
of installing air pollution control technology
that would enable fossil-fired plants to
comply with the proposed PM standards. He
explained that he would first have to know
if the power plants in question are going
to retrofit a unit, retire, build new generation,
or rely on the market for power. " Once
we know this answer, then we would have
to know the stringency and form of the
regulation(s), " he said.
When discussing the probable impact that air
pollution control upgrades will have on affected
power plants' bottom lines, Andrews referred
to the " good old days when there were fewer
moving parts in the environmental arena. " He
explained that today there is great uncertainty
about the required controls and cost impacts related
not only to air regulations, but also water
and coal combustion residuals regulations.
Is retrofitting a coal unit cost competitive
compared to buying market power or other
forms of energy such as natural gas combustion?
An answer to this question is quite
utility-specific, according to Andrews. It will
depend on many factors, including delivered
fuel costs, environmental costs, the power
market pricing in specific geographical areas
and the individual utility's future projections
of key cost and risk issues
" Historically, energy companies have
done a great job of balancing regulations,
ratepayer costs, and-for investor-owned
utilities-a reasonable rate of return for the
shareholders, " Andrews said. " Their job is
even harder today, but I am confident that
they will continue to perform well. "
EEI Responds to Proposed PM
Standards
The Edison Electric Institute (EEI), an association
of shareholder-owned electric companies,
filed its comments about the proposed
PM standards with the EPA on August 31,
and referred to the " regulatory treadmill of
NAAQS standards. " The group said that if
the proposed PM rules are finalized, the EPA
will be adding to the already existing list of
separately enforceable PM NAAQS. Accoring
to the EEI, finalization of the proposed
PM rules would mean that the EPA and the
states will be concurrently implementing:
November 2012 | POWER
■ The 1997 PM2.5 annual standard.
■ The 2006 PM2.5 24-hour standard.
■ A new 2012 PM2.5 annual standard.
■ A potentially revised 2012 PM2.5 24-hour
standard.
■ The 1987 PM10 24-hour standard.
■ A new 2012 secondary PM2.5 visibility
standard.
■ The 2006 secondary PM2.5 standards as
newly targeted on " other " welfare effects
apart from visibility.
Under the EPA's currently planned schedule
for NAAQS reviews, a new ozone standard
could be promulgated in 2014 that
would layer on top of existing standards and
potentially add another secondary standard
to the two 2012 PM2.5 secondary standards,
according to the EEI. In addition, during this
time period, the newly revised NO2
and SO2
NAAQS will be implemented, requiring additional
designations and SIP submittals.
The EEI said that the EPA needs to do " a
far better job of coordinating these regulations
and minimizing their overall burden
for the agency itself, states, and regulated
entities. " The current situation causes " an
immense waste of resources " and, given the
lengthy process of designating new nonattainment
areas and revising SIPs, fosters years of
uncertainty for states, local governments, and
industry that are affected by revised NAAQS,
it said. The industry group commented that
the EPA should, instead, seek to rationalize
its NAAQS process to better conform to existing
executive orders.
Looking Ahead
Currently, the proposed PM standards' implementation
timeline is unpredictable because
of the complicated implementation process.
The most likely scenario would require the
individual states to monitor PM2.5, submit a
list of non-attainment areas to the EPA, develop
SIPs for compliance, obtain EPA approval
of the proposed SIPs, and then require
controls in or near non-attainment areas.
Even though the implementation process
could take as long as five years, regulated facilities
need to start planning for how to deal
successfully with compliance and permitting
issues. The increased complexity of PM2.5
NAAQS compliance will no doubt boost facility
costs and staff work hours. Therefore,
it is important to begin assessing projected
PM2.5 emissions and possible permitting
problems to prepare for and, hopefully, avoid
permitting hurdles and delays. ■
-Angela Neville, JD, is senior editor of
POWER.
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