ENVIRONMENTAL ASSESSMENT FOR PROPOSED ENERGY CONSERVATION

STANDARDS FOR BEVERAGE VENDING MACHINES

TABLE OF CONTENTS

EA.1 **INTRODUCTION**

**.......................................................................................................... 1** 

EA.2 **METHODOLOGY**

**......................................................................................................... 1** 

EA.3 **RESULTS**

**....................................................................................................................... 3** 

**REFERENCES**

**............................................................................................................................... 4** 

**EA­i EA­ii** ENVIRONMENTAL ASSESSMENT FOR PROPOSED ENERGY CONSERVATION

STANDARDS FOR BEVERAGE VENDING MACHINES

EA.1 INTRODUCTION

**The U.S.**  **Department of**  **Energy (DOE)**  **will conduct**  **an environmental**  **assessment as**  **part**

**of the**  **Notice of**  **Public Rulemaking**  **for beverage**  **vending machines.**  **DOE will**  **assess the** 

**impacts of**  **proposed energy**  **conservation standards**  **for beverage**  **vending machines**  **on certain** 

**environmental indicators**  **using a**  **variant of**  **the U.S.**  **DOE/Energy Information**  **Administration**

**(EIA)’s National**  **Energy Modeling**  **System (NEMS).**  **a DOE/EIA**  **uses NEMS**  **to produce**  **the EIA** 

2007 Annual Energy Outlook (AEO2007). **1 DOE**  **will use**  **a variant**  **known as**  **NEMS­BT to** 

**provide key**  **inputs to**  **the analysis.**  **Results of**  **the environmental**  **analysis are**  **similar to**  **those**

**provided in**  AEO2007

**. DOE**  **anticipates that**  **the primary**  **environmental effects**  **will be**  **reduced**

**power plant**  **emissions resulting**  **from reduced**  **electricity consumption.** 

**DOE intends**  **the environmental**  **assessment to**  **provide emissions**  **results to**  **policymakers**

**and interveners,**  **and to**  **fulfill requirements**  **that the**  **environmental effects**  **of all**  **new Federal**  **rules**

**be properly**  **quantified and**  **considered. The**  **environmental assessment**  **considers three**  **pollutants**

**(sulfur dioxide**  **(SO 2**  **), nitrogen**  **oxides (NO** 

**x ),**  **and mercury**  **(Hg)) as**  **well as**  **carbon emissions.** 

**The only**  **form of**  **carbon emissions**  **tracked by**  **NEMS­BT is**  **of carbon**  **dioxide (CO**  **2 ),**  **so the** 

**carbon discussed**  **in this**  **report is**  **only in**  **the form**  **of CO**  **2**

**. For**  **each of**  **the standard**  **levels, DOE** 

**will calculate**  **total emissions**  **using NEMS­BT,**  **with external**  **analysis used**  **as needed.** 

**DOE will**  **conduct the**  **environmental assessment**  **as a**  **policy deviation**  **from the** 

AEO2007

**, using**  **the same**  **basic set**  **of assumptions.**  **For example,**  **the emissions**  **characteristics**

**of an**  **electricity generating**  **plant will**  **be exactly**  **those used**  **in** AEO2007

**. The**  **NEMS** reference

case **and alternative**  **growth scenarios**  **are as**  **described in**  **the utility**  **impact analysis**  **(chapter 13** 

**of the**  **Technical Support**  **Document (TSD)).** 

EA.2 METHODOLOGY

**The NEMS­BT**  **tracks carbon**  **emissions using**  **a detailed**  **carbon module;**  **this approach** 

**provides good**  **results because**  **of its**  **broad coverage**  **of all**  **sectors and**  **inclusion of**  **interactive**

**effects. Past**  **experience with**  **carbon results**  **from NEMS**  **suggests that**  **the NEMS­generated** 

**emissions estimates**  **are somewhat**  **lower than**  **estimates based**  **on simple**  **average factors.**  **One of** 

**the reasons**  **for this**  **divergence is**  **that NEMS**  **tends to**  **predict that**  **conservation measures**  **will**

**slow generating**  **capacity growth**  **in future**  **years, and**  **new generating**  **capacity is**  **expected to**  **be**

**more efficient**  **than existing**  **capacity. On**  **the whole,**  **NEMS­BT provides**  **carbon emissions** 

**results of**  **reasonable accuracy,**  **at a**  **level consistent**  **with other**  **published Federal**  **results. In** 

**addition to**  **providing estimates**  **of quantitative**  **impacts of**  **beverage vending**  **machine standards** 

**a For**  **more information**  **on NEMS,**  **please refer**  **to the**  **U.S. Department**  **of Energy,**  **Energy Information** 

**Administration documentation.**  **A useful**  **summary is**  National Energy Modeling System: An Overview 2000

**, DOE/EIA­0581(2000),**  **March 2000.**  **EIA approves**  **use of**  **the name**  **NEMS to**  **describe only**  **an official**  **version of** 

**the model**  **without any**  **modification to**  **code or**  **data. Because**  **this analysis**  **entails some**  **minor code**  **modifications**

**and the**  **model is**  **run under**  **various policy**  **scenarios that**  **are variations**  **on EIA**  **assumptions, we**  **refer to**  **it as** 

**NEMS­BT (BT**  **is DOE’s**  **Building Technologies**  **Program). NEMS­BT**  **was previously**  **called NEMS­BRS.** 

**EA­1 on**  **carbon emissions,**  **DOE will**  **consider the**  **use of**  **monetary values**  **to represent**  **the potential** 

**value of**  **such emissions**  **reductions.**

**The NEMS­BT**  **model reports**  **the two**  **airborne pollutant**  **emissions that**  **DOE has**  **reported**

**in past**  **analyses, SO**  **2 and**  **NO**

**x .**  **The Clean**  **Air Act**  **Amendments of**  **1990 set**  **an SO**  **2 emissions** 

**cap on**  **all large**  **power plants.**  **The attainment**  **of this**  **target, however,**  **is flexible**  **among**

**generators through**  **the use**  **of emissions**  **allowances and**  **tradable permits.**  **The NEMS­BT**  **model**

**includes a**  **module for**  **SO 2**  **allowance trading**  **and delivers**  **a forecast**  **of SO**  **2 allowance**  **prices.**

**Accurate simulation**  **of SO**  **2 trading**  **tends to**  **imply that**  **physical emissions**  **effects will**  **be zero,**  **as**

**long as**  **emissions are**  **at the**  **ceiling.**

**However, there**  **may be**  **an SO**  **2 economic**  **benefit from**  **energy conservation,**  **in the**  **form**

**of a**  **lower SO**  **2 allowance**  **price as**  **a result**  **of additional**  **allowances from**  **this rule,**  **and if**  **it is** 

**large enough**  **to be**  **calculable by**  **NEMS­BT, DOE**  **will report**  **this value.**  **The NEMS­BT**  **model**

**also has**  **an algorithm**  **for estimating**  **NO**

**x emissions**  **from power**  **generation. The**  **impact of**  **these**

**emissions, however,**  **will be**  **affected by**  **the Clean**  **Air Interstate**  **Rule (CAIR)**  **issued by**  **the U.S.** 

**Environmental Protection**  **Agency on**  **March 10,**  **2005. (70**  **FR 25162**  **(May 12,**  **2005). CAIR** 

**will permanently**  **cap emissions**  **of NO** 

**x in**  **28 eastern**  **States and**  **the District**  **of Columbia.**  **As**

**with SO**  **2 emissions,**  **a cap**  **on NO** 

**x emissions**  **means that**  **equipment energy**  **conservation**

**standards are**  **not likely**  **to have**  **a physical**  **effect on**  **NO**

**x emissions**  **in States**  **covered by**  **the**

**CAIR caps.**  **Therefore, while**  **the emissions**  **cap may**  **mean that**  **physical emissions**  **reductions in** 

**those States**  **will not**  **result from**  **standards, standards**  **could produce**  **an environmental­related** 

**economic benefit**  **in the**  **form of**  **lower prices**  **for emissions**  **allowance credits.**  **However, as**  **with**

**SO 2**  **allowance prices,**  **DOE does**  **not plan**  **to monetize**  **this benefit**  **for those**  **States because**  **the**

**impact on**  **the NO** 

**x allowance**  **price from**  **any single**  **energy conservation**  **standard is**  **likely to**  **be**

**small and**  **highly uncertain.** 

**With regard**  **to mercury**  **emissions, NEMS­BT**  **has an**  **algorithm for**  **estimating these** 

**emissions from**  **power generation,**  **and, as**  **it has**  **done in**  **the past,**  **DOE is**  **able to**  **report an** 

**estimate of**  **the physical**  **quantity of**  **mercury emissions**  **reductions associated**  **with an**  **energy**

**conservation standard.**  **DOE assumed**  **that these**  **emissions would**  **be subject**  **to EPA’s**  **Clean Air** 

**Mercury Rule**  **b (CAMR),**  **which would**  **permanently cap**  **emissions of**  **mercury for**  **new and** 

**existing coal­fired**  **plants in**  **all States**  **by 2010.**  **Similar to**  **SO 2**  **and NO** 

**x ,**  **DOE assumed**  **that**

**under such**  **a system,**  **energy conservation**  **standards would**  **result in**  **no physical**  **effect on**  **these**

**emissions, but**  **would be**  **expected to**  **result in**  **an environmental­related**  **economic benefit**  **in the** 

**form of**  **a lower**  **price for**  **emissions allowance**  **credits. DOE’s**  **plan for**  **addressing analysis**  **does**

**not include**  **monetizing the**  **benefits of**  **reduced mercury**  **emissions, because**  **DOE considered**  **that**

**valuation of**  **such impact**  **from any**  **single energy**  **conservation standard**  **would likely**  **be small**  **and**

**highly uncertain.** 

**On February**  **8, 2008,**  **the U.S.**  **Court of**  **Appeals for**  **the District**  **of Columbia**  **Circuit**

**(D.C. Circuit)**  **issued its**  **decision in**  **State of**  **New Jersey,**  **et al.**  **v. Environmental**  **Protection**

**Agency c** 

**, in**  **which the**  **Court, among**  **other actions,**  **vacated the**  **CAMR referenced**  **above.**

**b 70**  **FR 28606**  **(May 18,**  **2005)**

**c No.**  **05­1097, 2008**  **WL 341338,**  **at** ***1 (D.C.**  **Cir. Feb.**  **8, 2008).** 

**EA­2 Accordingly,**  **DOE is**  **considering whether**  **changes are**  **needed to**  **its plan**  **for addressing**  **the issue** 

**of mercury**  **emissions in**  **light of**  **the D.C.**  **Circuit’s decision.** 

**With regard**  **to particulates,**  **these emissions**  **are a**  **special case**  **because they**  **arise not**  **only**

**from direct**  **emissions, but**  **also from**  **complex atmospheric**  **chemical reactions**  **that result**  **from**

**NO**

**x and**  **SO 2**  **emissions. DOE**  **does not**  **intend to**  **analyze or**  **report on**  **the particulate**  **emissions**

**from power**  **plants because**  **of the**  **highly complex**  **and uncertain**  **relationship between**  **particulate**

**emissions and**  **particulate concentrations**  **that impact**  **air quality.** 

EA.3 RESULTS

**The results**  **of the**  **environmental analysis**  **are similar**  **to a**  **complete NEMS**  **run, as** 

**published in**  **the** AEO2007

**. These**  **include power**  **sector emissions**  **for SO**  **2 ,**  **NO**

**x ,**  **and carbon,**  **and**

**SO 2**  **prices, in**  **five­year forecasted**  **increments extrapolated**  **to the**  **year 2042.**  **DOE reports**  **the**

**outcome of**  **the analysis**  **for each**  **trial standard**  **level as**  **a deviation**  **from the**  AEO2007 reference

case **results.**

**EA­3**REFERENCES

**1. EIA**  **(Energy Information**  **Administration). 2007.**  Annual Energy Outlook 2007. **EIA,**

**Washington, D.C.,**  **DOE/EIA­0554 (2007).** 

**EA­4**