The Acid Rain Program (ARP), established under Title IV of the 1990 Clean Air Act (CAA) Amendments, 

requires major emission reductions of SO2 and NOx, 

the primary precursors of acid rain, from the electric power industry. The SO2 program sets a permanent cap on the 

total amount of SO2 that may be emitted by electric generating units (EGUs) in the contiguous United States. The 

program is phased in, with the final 2010 SO2 cap set at 

8.95 million tons, a level of about one-half of the emissions 

from the power sector in 1980. NOx reductions under the 

ARP are achieved through a program that applies to a subset of coal-fired EGUs and is closer to a traditional, ratebased regulatory system. Since the program began in 1995, 

the ARP has achieved significant emission reductions. 

Table 1 shows that between 2004 and 2008, SO2 and NOx

emissions fell significantly, while heat input (a surrogate 

measure of electricity generation) increased slightly. Most 

of the recent reductions since 2005 are from early reduction incentives of the Clean Air Interstate Rule (CAIR) covering most eastern states.

Over the next several months, EPA will release a series of 

reports summarizing progress under the ARP. This first report presents 2008 data on emission reductions, compliAt a Glance: ARP Results in 2008 

SO2 Emissions: 7.6 million tons

SO2 Compliance: 100%

SO2 Allowances: Banked allowances increased by 

almost 2 million from 2007 levels

SO2 Allowance Prices: Nominal allowance prices 

declined sharply during the year, from a monthly average of $509/ton in January to $179/ton in December

NOx Emissions: 3.0 million tons

NOx Compliance: 100%

July 2009

ance results, and SO2 allowance prices. Future reports will 

evaluate progress under the ARP in 2008 by analyzing emission reductions, reviewing compliance results and market 

activity, and comparing changes in emissions to changes in 

acid deposition and surface water chemistry. For more information on the ARP, please visit: <http://www.epa.gov/

airmarkets/progsregs/arp/index.html>. 

Fuel Type

2004 2005 2006 2007 2008

SO2 NOx HI SO2 NOx HI SO2 NOx HI SO2 NOx HI SO2 NOx HI

Coal 9,840 3,484 20.49 9,837 3,356 20.77 9,244 3,208 20.44 8,768 3,069 20.75 7,517 2,816 20.25

Oil 377 138 1.00 349 129 0.99 135 63 0.58 149 68 0.61 84 46 0.48

Gas 36 134 4.83 35 142 5.34 8 131 5.70 10 141 6.32 7 129 6.21

Other 3 6 0.03 3 6 0.03 7 7 0.05 7 5 0.05 10 5 0.06

Total 10,256 3,762 26.34 10,223 3,633 27.13 9,393 3,409 26.77 8,933 3,283 27.74 7,617 2,996 26.99

Notes:

•	 Emissions are in thousand tons, and heat input data are in quadrillion Btu (Quads). Totals may not reflect individual rows from rounding. 

Fuel type represents primary fuel type; many electric generation units might combust more than one fuel.

•	 EPA data in Table 1 and used elsewhere in this report are current as of July 1, 2009, and may differ from past reports as a result of resubmissions by sources and ongoing data quality assurance activities.

Source: EPA, 2009

Table 1: SO2, NOx, and Heat Input Trends in Acid Rain Program Units, by Fuel Type

Acid Rain and Related Programs:

2008 Emission, Compliance, and Market Data
2

Acid Rain and Related Programs: 2008 Emission, Compliance, and Market Data

Table 2: Origin of 2008 Allowable SO2 Emission Levels

Type of Allowance AllocationNumber of 

Allowances

Explanation of Allowance 

Allocation Type

Initial Allocation 9,191,897 Initial allocation is the number of allowances 

granted to EGUs based on the product of their 

historical utilization and emission rates specified in the Clean Air Act.

Allowance Auction 250,000 The allowance auction provides allowances 

to the market that were set aside in a Special 

Allowance Reserve when the initial allowance 

allocation was made.

Opt-in Allowances 106,497 Opt-in allowances are provided to units entering the program voluntarily. There were 20 

opt-in units in 2008.

Total 2008 Alloca- tion9,548,394

Total Banked 

Allowances

6,678,688 Banked allowances are those allowances 

accrued in a facility's account from previous 

years, which can be used for compliance in 

2008 or any future year.

Total 2008 Allowable Emissions16,227,082

Notes: Total banked allowances are adjusted from the 2007 Progress 

Report to account for additional allowance deductions made after 

the 2007 reconciliation was completed.

Source: EPA, 2009

SO2 Emission Reductions

The SO2 requirements under the ARP apply to EGUs, fossil 

fuel-fired combustors that serve a generator that provides 

electricity for sale. The vast majority of ARP SO2 emissions 

result from coal-fired EGUs, although the program also applies to oil and gas units.

As Figure 1 shows, ARP units have reduced annual SO2

emissions by 56 percent compared with 1980 levels and 

52 percent compared with 1990 levels. Sources emitted 7.6 

million tons of SO2 in 2008, well below the current annual 

emission cap of 9.5 million tons, and already below the 

statutory annual cap set for compliance in 2010. 

Reductions in SO2 emissions from other sources not affected by the ARP (including industrial and commercial boilers 

and the metals and refining industries) and use of cleaner 

fuels in residential and commercial burners contributed to 

a similar overall decline (56 percent) in annual SO2 emissions from all sources since 1980. National SO2 emissions 

from all sources have fallen from nearly 26 million tons in 

1980 to about 11.4 million tons in 2008 (see data available 

at <www.epa.gov/ttn/chief/trends>).

The states with the highest emitting sources in 1990 have 

generally seen the greatest SO2 reductions under the ARP 

(see Figure 2). Most of these states are upwind of the arFigure 1: SO2 Emissions from Acid Rain Program Sources, 1980 - 2008

Source: EPA, 2009

Phase II (2000 on) Sources All Affected Sources

9.4 9.3

8.7

5.3 5.4 5.5 5.3 4.9

17.3

16.1 15.7

11.9

12.5 13.0 13.1

12.5

11.2

10.6 10.2 10.6 10.3 10.2

9.4 8.9

7.6

8.7 8.3

7.1 7.0

10.0

9.6 9.5 9.5 9.5 9.5 9.5 9.5 9.5

Phase I (1995-1999) Sources Allowances Allocated

1980 1985 1990 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008

2

4

6

8

10

12

14

16

18

20

SO2 Emissions (million tons)

7.0
3

Acid Rain and Related Programs: 2008 Emission, Compliance, and Market Data

Scale: Largest bar equals 2.2 million tons of SO2 emissions in Ohio, 1990.

Source: EPA, 2009

Figure 2: State-by-State SO2 Emission Levels for Acid Rain Program Sources, 1990-2008

1990 Emissions

1995 Emissions

2000 Emissions

2005 Emissions

2008 Emissions

eas the ARP was designed to protect, and reductions have 

resulted in important environmental and health benefits 

over a large region.

In addition, from 2007 to 2008, reductions in SO2 emissions from ARP units in 38 states totaled about 1.3 million 

tons, or about 15 percent for the year. Five states (Georgia, Indiana, North Carolina, Ohio, and Pennsylvania) accounted for most of the one-year reductions from 2007 to 

2008, ranging from 119,271 to 244,651 tons of SO2 in each 

of these states.

From 1990 to 2008, annual SO2 emissions in 38 states and 

the District of Columbia fell by a total of approximately 8.2 

million tons. In contrast, annual SO2 emissions increased by 

a total of 79,309 tons in 10 states from 1990 to 2008. The 

seven states with the greatest reductions in annual emissions since 1990 include Ohio, which decreased emissions 

by over 1.5 million tons, and Illinois, Indiana, Kentucky, 

Missouri, Tennessee, and West Virginia, each of which reduced total emissions during this time period by more than 

500,000 tons.

SO2 Program Compliance

For 2008, EPA allocated 9.5 million SO2 allowances under 

the ARP (see Table 2). Together with 6.7 million unused allowances carried over (or banked) from prior years, there 

were 16.2 million allowances available for use in 2008. 

ARP sources emitted approximately 7.6 million tons of SO2

in 2008, less than the allowances allocated for the year, and 

far less than the total allowances available (see Figure 3). 

In 2010, the total number of Title IV allowances allocated 

annually will drop to 8.95 million and remain statutorily 

fixed at that annual level.

Table 2 explains in more detail the origin of the allowances 

that were available in 2008, and Table 3 shows how those 

allowances were used. Approximately 7.6 million allowances were deducted from sources’ accounts in 2008 to cover 

emissions. From 2007 to 2008, the number of banked allowances increased by nearly two million allowances to 

8.6 million, a 28 percent increase. In 2008, all ARP facilities 

complied with the requirement to hold enough allowances 

to cover SO2 emissions.
4

Acid Rain and Related Programs: 2008 Emission, Compliance, and Market Data

Figure 3: SO2 Emissions and the Allowance Bank, 1995-2008

Source: EPA, 2009

Table 3: SO2 Allowance Reconciliation Summary, 2008

Total Allowances Held (1995 - 2008 vintages) 16,227,082

Affected Facility Accounts 12,210,477

Other (General and Non-Affected Facility Accounts) 4,016,605

Allowances Deducted* 7,602,693

Penalty Allowance Deductions ( 2009 Vintage) 0

Banked Allowances 8,624,389

Affected Facility Accounts 4,607,784

Other (General and Non-Affected Facility Accounts) 4,016,605

 * Includes 3,315 allowances deducted from opt-in sources for reduced utilization. Additionally, allowances deducted for emissions 

are about 14,000 tons less than the total emissions used elsewhere 

in this report, which reflect data reported as of July 1, 2009. This 

is a result of rounding differences, any changes in reported emission data after reconciliation, and resolution of petitions, including 

emissions for one facility (WH Zimmer in OH) that has not been 

reconciled due to a monitoring petition. When this facility is reconciled the number of allowances deducted will go up and the 

amount of banked allowances will decrease.

Source: EPA, 2009

Figure 4: Average Monthly SO2 Allowance Price, August 1994 - 

May 2009

Source: CantorCO2e Market Price Index, 2009

8.7

11.7

13.4

15.0

16.6

21.6

19.9

18.8 18.2

17.1

16.4 15.7 15.8 16.2

5.3 5.4 5.5 5.3 4.9

11.2 10.6 10.2 10.6 10.3 10.2

9.4 8.9

7.6

5

10

15

20

25

1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008

Allowances Allocated Unused Allowances from Previous Years Actual Emissions from Affected Sources

SO2 (million tons)

$0

$200

$400

$600

$800

$1,000

$1,200

$1,400

$1,600

$1,800

Nominal Price ($/ton)

Mar-94

Mar-95Mar-96

Mar-97Mar-98

Mar-99Mar-00Mar-01Mar-02Mar-03Mar-04Mar-05Mar-06Mar-07Mar-08Mar-09Mar-10

2008 SO2 Allowance Market 

In 2008, the SO2 allowance market experienced a 65% 

price decline; the monthly average price fell from $509 per 

ton in January to $179 per ton by December (see Figure 4). 

That decline has continued in 2009, falling to $71/ton by 

May. ARP reports released in the coming months will analyze allowance market activity in more detail.
5.5 5.4 5.4 5.5 5.3

4.8

4.5

4.1 4.0

3.8

3.4 3.3 3.1 3.0

2.7

6.7

6.1 5.9 6.0 6.0

5.5

5.1

4.7 4.5 4.2

3.8 3.6

3.4 3.3

3.0

1

2

3

4

5

6

7

8

1990 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008

NOx Emissions (million tons)

NOx Program Affected Sources Title IV Sources Not Affected for NOx

5

Acid Rain and Related Programs: 2008 Emission, Compliance, and Market Data

NOx Emission Reductions

Title IV requires NOx emission reductions for certain coalfired EGUs by limiting the NOx emission rate (expressed in 

lb/mmBtu). Congress applied these rate-based emission 

limits based on a unit’s boiler type (see Table 4). The goal 

of the NOx program is to limit NOx emission levels from 

the affected coal-fired boilers so that their emissions are 

at least 2 million tons less than the projected level for the 

year 2000 without implementation of Title IV.

Figure 5 shows that NOx emissions from all ARP sources 

were 3.0 million tons in 2008. This level is 5.1 million tons 

less than the projected level in 2000 without the ARP, or 

more than double the Title IV NOx emission reduction objective. While the ARP was responsible for a large portion 

of these annual NOx reductions, other programs—such as 

the Ozone Transport Commission (OTC), the NOx Budget 

Program under EPA’s NOx State Implementation Plan (SIP) 

Call, and other regional and state NOx emission control 

programs—also contributed significantly to the NOx reductions achieved by sources in 2008.

From 1995 to 2008, annual NOx emissions from ARP units 

dropped by about 3.1 million tons, a net decrease of 51 percent. Forty-two states and the District of Columbia reduced 

NOx emissions during this period versus six states that accounted for only about 15,600 tons of increased NOx emissions during the same period (see Figure 6). 

Table 4: NOx-Affected Title IV Units by Boiler Type and NOx

Emission Limit

Coal-Fired Boiler Type

Title IV Standard NOx

Emission Limits 

(lb/mmBtu)

Number of 

Units

Phase I Group 1 Tangentially Fired 0.45 133

Phase I Group 1 Dry Bottom, Wall-fired 0.50 107

Phase II Group 1 Tangentially Fired 0.40 300

Phase II Group 1 Dry Bottom, Wall-fired 0.46 294

Cell Burners 0.68 37

Cyclones > 155 MW 0.86 54

Wet Bottom > 65 MW 0.84 20

Vertically Fired 0.80 24

Total All Units 969

Source: EPA, 2009

NOx Compliance

The ARP NOx Program does not impose a cap on NOx emissions and does not rely on allowance trading. The program 

allows affected sources to comply either by meeting a unitspecific emission rate or by including two or more units in 

an emission rate averaging plan. These options provide afFigure 5: NOx Emission Trends for All Acid Rain Program Units, 1990-2008

Source: EPA, 2009
6

Acid Rain and Related Programs: 2008 Emission, Compliance, and Market Data

Figure 6: State-by-State NOx Emission Levels for Acid Rain Program Sources, 1990 - 2008

Scale: Largest bar equals 500,000 tons of NOx emissions in Ohio, 1990. 

Note: Area shaded in gray represents the NOx Budget Program geographic region.

Source: EPA, 2009

1990 Emissions

1995 Emissions

2000 Emissions

2005 Emissions

2008 Emissions

fected sources with the flexibility to meet the NOx emission 

reduction requirements in the most cost-effective manner. 

In 2008, all 969 units that were subject to the ARP NOx Program achieved compliance.