15 -i CHAPTER 15. EMISSIONS ANALYSIS

TABLE OF CONTENTS

15.1 INTRODUCTION ......................................................................................................... 15-1
15.2 APPROACH .................................................................................................................. 15-115 -1 15.1 INTRODUCTION

The U.S. Department of Energy (DOE) will conduct an emissions analysis as part of the notice of proposed rulemaking for electric motors.

In the emissions analysis, DOE will estimate the reduction in power sector emissions of carbon dioxide (CO 2 ), nitrogen oxides (NO X ), sulfur dioxide (SO 2 ) and mercury (Hg) from potential energy conservation standards for the considered products. In addition, DOE will estimate emissions impacts in production activities (extracting, processing, and transporting fuels) that provide the energy inputs to power plants. These are referred to as “upstream” emissions. Together, these emissions account for the full- fuel

- cycle (FFC). In accordance with DOE’s FFC Statement of Policy (76 FR 51282 (Aug. 18, 2011)), the FFC analysis in cludes impacts on emissions of methane and nitrous oxide, both of which are recognized as greenhouse

gases.

15.2 APPROACH

DOE may conduct the emissions analysis using emissions factors derived from data in

EIA’s Annual Energy Outlook 2012 , supplemented by d ata from other sources. EIA prepares the Annual Energy Outlook using NEMS. Each annual version of NEMS incorporates the projected impacts of existing air quality regulations on emissions.

SO 2 emissions from affected electric generating units (EGUs) are subject to nationwide and regional emissions cap and trading programs. Title IV of the Clean Air Act sets an annual emissions cap on SO 2 for affected EGUs in the 48 contiguous states and the District of Columbia (D.C.). SO 2 emissions from 28 eastern states and D.C. were also limited under the Clean Air Interstate Rule (CAIR), which created an allowance -based trading program that operates along with the Title IV program in those States and D.C. 70 FR 25162 (May 12, 2005). CAIR was remanded to EPA by the U.S. Court of Appeals for the District of Columbia Circuit (D.C. Circuit), but it remains in effect. See North Carolina v. EPA , 550 F.3d 1176 (D.C. Cir. 2008);
North Carolina v. EPA , 531 F.3d 896 (D.C. Cir. 2008). On July 6, 2011 EPA issued a replacement for CAIR, the Cross -State Air Pollution Rule (CSAPR; also known as the Transport Rule). 76 FR 48208 (August 8, 2011). The AEO 2012 NEMS assumes the implementation of
the CSAPR. a

a On December 30, 2011, the D.C. Circuit stayed the new rules while a panel of judges reviews them, and told EPA

to con tinue administering CAIR (see EME Homer City Generation v. EPA , No. 11

- 1302, Slip Op. at *2 (D.C. Cir. Dec. 30, 2011)). On August 21, 2012, the D.C. Circuit issued a decision to vacate CSAPR. See EME Homer City Generation, LP v. EPA

, No. 11

- 1302

, 2012 WL 3570721 at *24 (D.C. Cir. Aug. 21, 2012). The court again ordered EPA to continue administering CAIR. AEO 2012 had been finalized prior to this decision, however. DOE understands that CAIR and CSAPR are similar with respect to their effect on emissions impacts of energy efficiency
standards.15 -2 The attainment of emissions caps is typically flexible among EGUs and is enfor ced through the use of emissions allowances and tradable permits. Under existing EPA regulations, any excess SO 2 emissions allowances resulting from the lower electricity demand caused by the adoption of an efficiency standard could be used to permit offse tting increases in SO 2 emissions by any regulated EGU. In past rulemakings, DOE recognized that there was uncertainty about the effects of efficiency standards on SO 2 emissions covered by the existing cap

- and

- trade system, but it concluded that no reductions in power sector emissions would occur for SO 2 as a result of standards.

Beginning in 2015, however, SO 2 emissions will fall as a result of the Mercury and Air Toxics Standards (MATS) for power plants, which were announced by EPA on December 21, 2011. 77 FR 9304 (Feb. 16, 2012). b In the final MATS rule, EPA established a standard for HCl as a surrogate for acid gas hazardous air pollutants (HAP), and also established a standard for

SO 2 (a non- HAP acid gas) as an alternative equivalent surrogate standard for acid gas HAP. The same controls are used to reduce HAP and non-HAP acid gas; thus, SO 2 emissions will be reduced as a result of the control technologies installed on coal-fired power plants to comply with the MATS requirements for acid gas. AEO 2012 assumes that, in order to continue operating, coal plants must have either flue gas desulfurization or dry sorbent injection systems installed by 2015. Both technologies, which are used to reduce acid gas emissions, also reduce

SO 2 emissions. Under the MATS, NEMS shows a reduction in SO 2 emissions when electricity demand decreases (e.g., as a result of energy efficiency standards). Emissions will be far below the cap that would be established by CSAPR, so it is unlikely that excess SO 2 emissions
allowances resulting from the lower electricity demand would be needed or used to permit offsetting increases in SO 2 emissions by any regulated EGU. Therefore, DOE believes that efficiency standards will reduce SO 2 emissions in 2015 and beyond.

CSAPR established a cap on NO X emissions in eastern States and the District of Columbia. Energy conservation standards are expected to have little or no physical effect on these emissions in those States covered by CSAPR because excess NO

x emissions allowances resulting from the lower electricity demand could be used to permit offsetting increases in NO
x emissions. However, standards would be expected to reduce NO

x emissions in the States not affected by CSAPR. Therefore, DOE estimates NO X emissions reductions from potential standards in the States where emissions are not capped.

The MATS limit mercury emissions from power plants, but they do not include emissions caps and, as such, DOE’s energy conservation standards would likely reduce Hg emissions. For this rulemaking, DOE estimated mercury emissions reductions using emissions factors based on AEO
2012 , which incorporates the MATS.

Power plants may emit particulates from the smoke stack, which are known as direct particulate matter (PM) emissions. NEMS does not account for direct PM emissions from power plants. DOE is investigating the possibility of using other methods to estimate r eduction in PM emissions due to standards. The great majority of ambient PM associated with power plants is in

b On July 20, 2012, EPA announced a partial stay, for a limited duration, of the effectiveness of national new source emission standards for hazardous air pollutants from coal
- and oil

- fired electric utility steam generating units. More

at: www.epa.gov/airquality/powerplanttoxics/pdfs/20120727staynotice.pdf15 -3 the form of secondary sulfates and nitrates, which are produced at a significant distance from power plants by complex atmospheric chemical react ions that often involve the gaseous emissions of power plants, mainly SO 2 and NO

x . The monetary benefits that DOE estimates for
reductions in SO 2 and NO

x emissions resulting from standards are in fact primarily related to the
health benefits of reduced ambient PM.