Options Suggested at GHG NSPS Listening Sessions for EGU NSPS (The Agency is pleased at the wide

range of constructive suggestions made by stakeholders and is evaluating the full range of options it heard from Stakeholders)
EPA held five listening sessions on the GHG NSPS between February 4, 2011 and March 4, 2011. 

### The purpose of these listening sessions was for EPA to obtain stakeholder views on the design of section 111 performance standards to reduce greenhouse gas (GHG) emissions from power plants and refineries. EPA is considering the information provided at these listening sessions as it develops the proposed EGU NSPS rules.
In the listening sessions, we received comment on a wide range of ideas. Participants offered multiple suggestions on how standards could be se t for new and existing units , and for existing standards suggested a nu mber of mechanisms to use . Note that there was broad support for the format of the standards being output based ( e.g

. pounds of GHG pe r KW produced)

. We have provide d additional information on options heard at the listening session s to provide context on how ideas like those suggested have been incorporated in previous NSPS actions.
As we continue to evaluate options for controlling GHGs, we are open to suggestions of additional options. We believe that the suggestions made during the listening session s provide a wide ran ge of options for inclusion in the SBREFA panel discussion.

New Source Standards :
Under 111(b), these standards r eflect the degree of emission limitation achievable through application of the best system of emission reduction which, taking into consideration the cost of achieving such reduction, any non

- air quality health and environmental impact, and energy requirem ents, the Administrator determines has been adequately demonstrated. In general, options that may be possible under 111(b) include, but are not limited to, the following major alternatives. EPA is interested in discussion of the advantages and disadvan tages of each of these alternative s , including discussion of whether any of these could be combined in a useful way.
Potential Options :

1. Fuel and technology specific efficiency standards based on existing technologies

– such a standard would likely look at coal based technologies currently being built such as ultra

supercritical plants and IGCCs . While EPA has issued NSPS regulations that are technology and fuel specific, in recent power sector NSPS actions, the agenc y has been moving more towards fuel neutral standards. 2. Standards more aggressive than those based on highly efficient coal powered units

– such standards could consider technologies such as CCS and/or co

- firing of lower CO2 fuels

. Such standard s could pot entially include emission rate averaging with certain other categories of

sources. For instance, offsets could be obtained from:

a. E xisti ng units that perform better than the existing source standard , orb. U nits that generate electricity but are not subject t o the EGU NSPS (for instance industrial units with on

- site generation and co

- generation)

. Previous NSPS rulemakings have been based on technologies demonstrated in the field (e.g. in the past when both scrubbers and SCRs were not nearly as prevalent on the coal

- fired fleet, NSPS limits were based on the performance of such technologies). 3. Fuel neutral standards

– rather than s etting limits based purely on technology, set standard s based on use of lower GHG fuels

– for instance, gas

- fired boilers

. Recen t power sec tor NSPS actions have moved more towards fuel neutral approaches

. 4. Phased approach

– set a standard based on option #1 that applies immediately and also requires a tighter standard based on option #2 or #3 after several years

. Existing Source S tandards
For existing sources under CAA 111(d) , EPA establishes emission guidelines for source s that emit pollutants not regulated under certa in provisions of the CAA, and to which an NSPS would apply if such existing source were a new source. This is the authority that would be used to establish standards for existing sources. T hese guidelines go through notice and com ment. States then promulgate plans that establis h standards of performance that are consistent with these emission guidelines. Historically, k ey elements of emission guidelines include a description of a system of emission reductions that EPA deems adequately demonstrated, the degree of emission limita tion achievable, costs, and environmental impacts of application, the time required to implement, and other information EPA determines is necessary to facilitate formation of State Plans. Different guidelines or compliance times (or both) may be specified for different sizes, types, and classes of designated facilities when costs, physical limitations, geographical location, or other factors make subcategorization appropriate. (See 40 CFR 60, Subpart B, “Adoption and Submittal of State Plans for Designate d Facilities.”) In developing standards for existing sources, we are considering both the structure of possible emissions limit s , as well as implementation mechanisms.
Potential Options:

1. Base guidelines on efficiency improvements of the existing fleet

– su ch an approach would likely involve reductions on the order of 5%, based on the performance of best units within sub

classes of boiler types ( see: Available and Emerging Technologies for Reducing Greenhouse Gas Emissions from Coal

- Fired Electric Generatin g Units , USEPA, October 2010 ( http://www.epa.gov/nsr/ghgdocs/electricgeneration.pdf ) and Improving the Efficiency of Coal

fired Power Plants for Near Term Greenhouse Gas Emission Reductio ns , NETL, April 16, 2010 ( http://www.circleofblue.org/waternews/wp

- content/uploads/2011/03/DOE

- NETL

- Coal

- fired

energy

- efficiency.pdf ) The approach of basing standards on best performing technology is consistent with the way many NSPS have been set. 2. S et more aggressive guidelines that would include not only eff iciency improvements, but also replacement of some older generation.

a. Could be based on remaining useful life cons iderations (e.g.
, when a unit reached a certain age such as 50 years, it would be required to meet tighter standards such as the new source standards)

.b. Could be based on some form of a system

- wide generation performance standard th at would gradually decrease as there was fleet turnover . Both the municipal waste combustor NSPS and the Clean Air Mercury Rule (CAMR) incorporated flexibility mechanisms that allowed averaging across facilities for compliance. Whi le CAMR was overturned by the DC Circuit, the court never ruled on this specific issue. 3. Phased approach

– establish guidelines based on option #1 at the beginning of the program and then require a tighter standard based on option #2 after several years. A phased approach was used in CAMR and the court never ruled on this issue

. Implementation Mechanisms

– In order to achieve the above limits, different implementation mechanisms may be used. In the listening session s , many participants suggested that State s should have flexibility to use a wide range of mechanisms to achieve reductions. In addition to the approaches discussed above, EPA is considering both the legal and policy implications of allowing States to use mechanisms to meet the 111(d ) standards t hat differ from the mechanism (or mechanisms) considered in the guidelines. Such an approach would require EPA to set forth criteria (such as an emission rate target or a comparison of projected emissions under an approach laid out in the emission guideli nes and the emissions under an alternative approach being considered by th e State). Options that participants proposed included:

1. Averaging with tradable credits

– Units would be given emission rate targets, if they emitted below those targets, they would generate credits for each MWh they generated. If they emitted above those targets, they would still be able to comply if they obtained credits to offset emissions above the target. Such an approach would only include unit s covered by the EGU NSPS. (A s was noted above, averaging type approaches have been used in both the mun icipal
waste combustor NSPS and CAMR

. ) 2. Generation performance standard

– similar to approach #1, but would include all generating sources (e.g. renewables, nuclear , etc .)

. 3. Recognition of r egional programs such as RGGI in 111(d) implementation. CAMR allowed the use of regional programs. 4. Intrastate programs wit h GHG limitations

. 5. Other programs that impact a State’s generation mix and could lead to reductions in emissions fr om covered sources such as renewable portfolio standards or clean energy standards.