New CO2 Performance Standard Proposal for New Electric Generators Issued by EPA

New CO2 Performance Standard Proposal for New Electric Generators Issued by EPA

On September 20, 2013, the Environmental Protection Agency (“EPA”) issued a new proposal to limit carbon dioxide (“CO2”) emissions from new coal-fueled and natural gas-fueled electric generating units. The proposal replaces a proposal EPA made last year.

For new coal-fueled units, including both coal boilers and integrated gasification combined cycle units, EPA proposed a standard of:

• 1,100 lb CO2/MWh gross over a 12-operating month period, or

• 1,000-1,050 lb CO2/MWh gross over an 84-operating month (7-year) period.

For new natural gas-fueled units, EPA proposed a standard of:

• 1,000 lb CO2/MWh gross for larger units (> 850 mmBtu/hr) and

• 1,100 lb CO2/MWh gross for smaller units (≤ 850 mmBtu/hr).

EPA stated that these proposals would not apply to modified or reconstructed sources. EPA also reiterated its intent to issue regulations next June requiring states to submit plans containing CO2 performance standards for existing units.

The proposed standards apply only to CO2 emissions and not to other greenhouse gas (“GHG”) emissions. However, EPA asked for comment on whether it should promulgate standards for these non-CO2 GHG emissions. EPA’s proposed standards also do not apply to biomass facilities. EPA recognizes that its coal standards cannot be met without the installation of carbon capture and storage (“CCS”). EPA maintains that new coal plants with partial CCS represents the “best system of emission reduction” for new coal plants.

Comments are due 60 days after publication in the Federal Register. EPA stated it will not consider comments that were filed on its previous CO2 performance standards in finalizing its current proposal.

A copy of the proposed rule is available here.

Read more at Renewable Energy Insights by Troutman Sanders LLP.

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