15

- i CHAPTER 1 5 . EMISSIONS IMPACT ANALYSIS

TABLE OF CONTENTS

15.1 INTRODUCTION ......................................................................................................... 15-1 15.2 AIR QUALITY REGULATIONS AND EMISSIONS IMPACTS ............................... 15-1 15.3 METHODOLOGY ........................................................................................................ 15-2 15.4 EMISSIONS IMPACT RES ULTS ................................................................................ 15-3

LIST OF TABLES

Table 15.4.1 Power Sector Emissions Forecast from AEO2012 Reference Case ................... 15-3 Table 15.4.2 Power Sector Emissions Impacts for Liquid Immersed Transformer TSLs ...... 15-4 Table 15.4.3 Power Sector Emissions Impacts for Low-Voltage Dry Type Transformer TSLs ................................................................................................................... 15-5 Table 15.4.4 Power Sector Emissions Impacts for Medium- Voltage Dry Type Transformer TSLs .............................................................................................. 15-615 -1 CHAPTER 15. EMISSIONS IMPACT ANALYSIS

15.1 INTRODUCTION
In the emissions analysis, DOE estimates 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.
DOE conducted the emissions impact analysis using the NEMS -BT model based on EIA’s Annual Energy Outlook 2012 (AEO 2012. 1 EIA prepares the Annual Energy Outlook using the National Energy Modeling System (NEMS).
Each annual version of NEMS incorporates the projected impacts of existing air quality regulations on emissions. AEO 2012 generally represents current Federal and State legislation and final implementation regulations available as of the end of December 2011.

15.2 AIR QUALITY REGULATI ONS AND EMISSIONS IMPACT S

SO 2 emissions from affected electric generating units (EGUs) are subje ct 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 that operates along with the Title IV program. 70 FR 25162 (May 12, 2005). CAIR was remanded to EPA by the U.S. Court of Appeals for th e District of Columbia Circuit (D.C. Circuit) but it remained in effect. On July 6, 2011 EPA issued a replacement for CAIR, the Cross- State Air Pollution Rule (CSAPR). 76 FR 48208 (August 8, 2011). The AEO 2012 NEMS used for this analysis assumes the imple mentation of CSAPR. a

The attainment of emissions caps is typically flexible among affected Electric Generating Units (EGUs) and is enforced through the use of emissions allowances and tradable permits. Under existing EPA regulations, any excess SO 2 emissi ons allowances resulting from the lower electricity demand caused by the imposition of an efficiency standard could be used to permit offsetting 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

a On December 30, 2011, the D.C. Circuit stayed the new rules while a panel of judges reviews them, and told EPA to continue enforcing CAIR . S ee EME Homer City Generation, LP v. EPA
, Order, No. 11

- 1302 , Slip Op. at *2 (D.C. Cir. Dec. 30
, 2011). On August 21, 2012, the D.C. Circuit vacated CSAPR and related Federal Implementation Plans that would have superseded the State Implementation Plans that EPA typically approves for compliance with Clean Air Act stationary source regulations. See EME Homer City Generation, LP v. EPA
, No. 11

- 1302
, 2012 WL 3570721 at *24 (D.C. Cir. Aug. 21, 2012). The court required EPA to continue administering CAIR. See id

. The AEO 2012, however, had been finalized prior to both these decisions. DOE understands, however, that CAIR and CSAPR are similar with respect to their effect on emissions impacts of energy efficiency standards.15 -2 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). In the final MATS rule, EPA established a standard for hydrogen chloride as a surrogate fo r 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 wi ll 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 28 eastern States and the District of Columbia. Energy conservation standards are expected to have little effect on NO x 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 estimate d NOx emissions reductions from potential standards in th ose States

. 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 Hgemissions. For this rulemaking, DOE estimated mercury emissions reductions using the NEMSBT based on AEO 2012 , which incorporates the MATS.

15.3 METHODOLOGY
The impact of the energy conservation standard on power sector air emissions is determined by calculating the difference between emissions projected in the NEMS

- BT reference case run and emissions projected in the NEMS-BT policy run. The policy run was decremented with site energy savings resulting from the standard which were developed in the national impact analysis (chap ter 10). The impact of the standard on power sector emissions was determined for each TSL (see chapter 14 for a description of the NEMS -BT model).
All extrapolations beyond 2040 are simple replications of year 2040 results. To emphasize the extrapolated results wherever they appear, they are shaded in gray to distinguish them from actual NEMS

- BT results.15 -3 15.4 EMISSIONS IMPACT RES ULTS

Tabl e 15.4.1 shows AEO2012 Reference Case power plant emissions in selected years. The Reference Case emissions are the emissions shown by the NEMS -BT model to result if none of the TSLs are promulgated (the base case).

Table 15.4.1 Power Sector Emissions Forecast from AEO2012 Reference Case NEMS

- BT Results 2015 2020 2025 2030 2035 2040 CO 2 (million metric tons) 2,011 2,067 2,17 9 2,25 8 2,3 30 2,35 8 NO X (million tons) 1.79 1.87 1.92 1.94 1.96 1.97 SO 2 (million tons) 1.26 1.31 1.55 1.6 2 1.71 1.74 Hg (tons) 6.4 6.7 7.2 7.5 7.9 8.0

Table s 15.4.2 through 15.4.4 show the estimated changes in power plant emissions of CO 2 , NO X , SO 2 , and Hg in selected years for each of the TSLs considered in this rulemaking. There are seven TSLs for liquid immersed transformers, six TSLs for low

- voltage dry type transformers, and five TSLs for medium- voltage dry type transformers. As in Table 15.4.1, values for CO 2 are given in metric tons, while values for NO X , SO 2 , and Hg are given in short tons. Over the time period 2016 through 2045, c umulative CO 2 , NO X , SO 2 , and Hg emissions are reduced compared to the Reference case for all TSLs. For comparison, the cumulative power sector emissions in the Reference case, over the same thirty year period , are 67,037 Mt for CO 2 , 57,696 kt for NOx, 47,079 kt for SO 2 , and 223 tons for Hg.15 -4 Table 15.4.2 Power Sector Emissions Impacts for Liquid Immersed Transformer TSLs

NEMS-BT Results* Difference from AEO2012 Reference Case
Total 2015 2020 2025 2030 2035 2040 2041 2045 2016-2045 Standard Level 1 CO 2 (Mt/yr) 0.02 -0.50 -1.10 -1.48 -1.80 -1.67 -1.67 -1.67 -37.7 NOx (1,000 tons/yr) 0.02 -0.46 -0.97 -1.27 -1.51 -1.40 -1.40 -1.40 -32.2 SO 2 (1,000 tons/yr) 0.01 -0.32 -0.78 -1.06 -1.32 -1.29 -1.29 -1.29 -27.4 Hg (ton/yr) 0.001 -0.002 -0.004 -0.004 -0.003 -0.003 -0.003 -0.003 -0.089

Standard Level 2 CO 2 (Mt/yr) 0.04 -0.88 -1.92 -2.59 -3.13 -3.03 -3.03 -3.03 -66.5 NOx (1,000 tons/yr) 0.03 -0.80 -1.69 -2.22 -2.64 -2.53 -2.53 -2.53 -56.7 SO 2 (1,000 tons/yr) 0.02 -0.56 -1.36 -1.85 -2.30 -2.24 -2.24 -2.24 -47.8 Hg (ton/yr) 0.001 -0.004 -0.008 -0.006 -0.005 -0.008 -0.008 -0.008 -0.171

Sandard Level 3 CO 2 (Mt/yr) 0.04 -0.95 -2.06 -2.79 -3.38 -3.29 -3.29 -3.29 -71.9 NOx (1,000 tons/yr) 0.04 -0.86 -1.82 -2.40 -2.85 -2.75 -2.75 -2.75 -61.3 SO 2 (1,000 tons/yr) 0.03 -0.60 -1.46 -1.99 -2.49 -2.43 -2.43 -2.43 -51.6 Hg (ton/yr) 0.001 -0.004 -0.008 -0.007 -0.006 -0.009 -0.009 -0.009 -0.185

Standard Level 4 CO 2 (Mt/yr) 0.07 -1.56 -3.43 -4.69 -5.75 -5.65 -5.65 -5.65 -122 NOx (kt/yr) 0.06 -1.41 -3.03 -4.03 -4.85 -4.72 -4.72 -4.72 -104 SO 2 (1,000 tons/yr) 0.04 -0.99 -2.44 -3.35 -4.23 -4.17 -4.17 -4.17 -87.5 Hg (ton/yr) 0.002 -0.007 -0.014 -0.011 -0.010 -0.015 -0.015 -0.015 -0.312

Standard Level 5 CO 2 (Mt/yr) 0.07 -1.55 -3.41 -4.66 -5.72 -5.63 -5.63 -5.63 -121 NOx (1,000 tons/yr) 0.06 -1.40 -3.01 -4.01 -4.82 -4.70 -4.70 -4.70 -103 SO 2 (1,000 tons/yr) 0.04 -0.98 -2.42 -3.34 -4.21 -4.15 -4.15 -4.15 -87.1 Hg (ton/yr) 0.002 -0.007 -0.014 -0.011 -0.010 -0.015 -0.015 -0.015 -0.311

Sandard Level 6 CO 2 (Mt/yr) 0.08 -1.74 -3.85 -5.31 -6.57 -6.51 -6.51 -6.51 -139 NOx (1,000 tons/yr) 0.07 -1.57 -3.40 -4.56 -5.53 -5.43 -5.43 -5.43 -118 SO 2 (1,000 tons/yr) 0.05 -1.10 -2.73 -3.80 -4.82 -4.80 -4.80 -4.80 -99.6 Hg (ton/yr) 0.002 -0.008 -0.015 -0.013 -0.011 -0.017 -0.017 -0.017 -0.355

Standard Level 7 CO 2 (Mt/yr) 0.10 -2.44 -5.51 -7.72 -9.73 -9.81 -9.81 -9.81 -204 NOx (1,000 tons/yr) 0.09 -2.21 -4.86 -6.64 -8.20 -8.19 -8.19 -8.19 -174 SO 2 (1,000 tons/yr) 0.07 -1.55 -3.91 -5.52 -7.15 -7.24 -7.24 -7.24 -147 Hg (ton/yr) 0.003 -0.011 -0.022 -0.019 -0.017 -0.026 -0.026 -0.026 -0.522

*CO 2 results are in metric tons, NO X , SO 2 , and Hg results are in short tons. Extrapolation15 -5 Table 15.4.3 Power Sector Emissions Impacts for Low-Voltage Dry Type Transformer TSLs

NEMS-BT Results* Difference from AEO2012 Reference Case
Total 2015 2020 2025 2030 2035 2040 2041 2045 2016-2045 Standard Level 1 CO 2 (Mt/yr) 0.04 -0.96 -2.13 -2.92 -3.60 -3.55 -3.55 -3.55 -76.0 NOx (1,000 tons/yr) 0.04 -0.87 -1.88 -2.51 -3.03 -2.96 -2.96 -2.96 -64.7 SO 2 (1,000 tons/yr) 0.03 -0.61 -1.51 -2.09 -2.64 -2.61 -2.61 -2.61 -54.6 Hg (ton/yr) 0.001 -0.004 -0.008 -0.007 -0.006 -0.009 -0.009 -0.009 -0.195

Standard Level 2 CO 2 (Mt/yr) 0.04 -1.03 -2.27 -3.12 -3.84 -3.79 -3.79 -3.79 -81.1 NOx (1,000 tons/yr) 0.04 -0.93 -2.00 -2.68 -3.24 -3.16 -3.16 -3.16 -69.2 SO 2 (1,000 tons/yr) 0.03 -0.65 -1.61 -2.23 -2.82 -2.79 -2.79 -2.79 -58.3 Hg (ton/yr) 0.001 -0.005 -0.009 -0.008 -0.007 -0.010 -0.010 -0.010 -0.208

Sandard Level 3 CO 2 (Mt/yr) 0.06 -1.29 -2.85 -3.92 -4.83 -4.76 -4.76 -4.76 -102 NOx (kt/yr) 0.05 -1.17 -2.52 -3.37 -4.07 -3.97 -3.97 -3.97 -86.9 SO 2 (1,000 tons/yr) 0.03 -0.82 -2.03 -2.80 -3.55 -3.51 -3.51 -3.51 -73.3 Hg (ton/yr) 0.002 -0.006 -0.011 -0.009 -0.008 -0.013 -0.013 -0.013 -0.261

Standard Level 4 CO 2 (Mt/yr) 0.08 -1.86 -4.12 -5.65 -6.96 -6.86 -6.86 -6.86 -147 NOx (1,000 tons/yr) 0.07 -1.68 -3.63 -4.86 -5.87 -5.73 -5.73 -5.73 -125 SO 2 (1,000 tons/yr) 0.05 -1.18 -2.92 -4.04 -5.11 -5.06 -5.06 -5.06 -106 Hg (ton/yr) 0.002 -0.009 -0.016 -0.014 -0.012 -0.018 -0.018 -0.018 -0.377

Standard Level 5 CO 2 (Mt/yr) 0.08 -1.89 -4.18 -5.74 -7.07 -6.97 -6.97 -6.97 -149 NOx (1,000 tons/yr) 0.07 -1.71 -3.69 -4.94 -5.96 -5.82 -5.82 -5.82 -127 SO 2 (1,000 tons/yr) 0.05 -1.20 -2.97 -4.11 -5.20 -5.14 -5.14 -5.14 -107 Hg (ton/yr) 0.002 -0.009 -0.017 -0.014 -0.012 -0.019 -0.019 -0.019 -0.383

Sandard Level 6 CO 2 (Mt/yr) 0.09 -2.03 -4.49 -6.16 -7.59 -7.48 -7.48 -7.48 -160 NOx (1,000 tons/yr) 0.08 -1.83 -3.96 -5.30 -6.40 -6.24 -6.24 -6.24 -137 SO 2 (1,000 tons/yr) 0.05 -1.29 -3.19 -4.41 -5.58 -5.52 -5.52 -5.52 -115 Hg (ton/yr) 0.003 -0.009 -0.018 -0.015 -0.013 -0.020 -0.020 -0.020 -0.411

*CO 2 results are in metric tons, NO X , SO 2 , and Hg results are in short tons. Extrapolation15 -6 Table 15.4.4 Power Sector Emissions Impacts for Medium -Voltage Dry Type Transformer TSLs

NEMS-BT Results* Difference from AEO2012 Reference Case
Total 2015 2020 2025 2030 2035 2040 2041 2045 2016-2045 Standard Level 1 CO 2 (Mt/yr) 0.00 -0.06 -0.14 -0.19 -0.23 -0.23 -0.23 -0.23 -4.86 NOx (1,000 tons/yr) 0.00 -0.06 -0.12 -0.16 -0.19 -0.19 -0.19 -0.19 -4.15 SO 2 (1,000 tons/yr) 0.00 -0.04 -0.10 -0.13 -0.17 -0.17 -0.17 -0.17 -3.50 Hg (ton/yr) 0.000 0.000 -0.001 0.000 0.000 -0.001 -0.001 -0.001 -0.012

Standard Level 2 CO 2 (Mt/yr) 0.00 -0.12 -0.26 -0.35 -0.43 -0.43 -0.43 -0.43 -9.15 NOx (kt/yr) 0.00 -0.10 -0.23 -0.30 -0.36 -0.36 -0.36 -0.36 -7.79 SO 2 (1,000 tons/yr) 0.00 -0.07 -0.18 -0.25 -0.32 -0.31 -0.31 -0.31 -6.57 Hg (ton/yr) 0.000 -0.001 -0.001 -0.001 -0.001 -0.001 -0.001 -0.001 -0.023

Sandard Level 3 CO 2 (Mt/yr) 0.01 -0.22 -0.50 -0.68 -0.84 -0.83 -0.83 -0.83 -17.7 NOx (1,000 tons/yr) 0.01 -0.20 -0.44 -0.59 -0.71 -0.69 -0.69 -0.69 -15.1 SO 2 (1,000 tons/yr) 0.01 -0.14 -0.35 -0.49 -0.62 -0.61 -0.61 -0.61 -12.7 Hg (ton/yr) 0.000 -0.001 -0.002 -0.002 -0.001 -0.002 -0.002 -0.002 -0.045

Standard Level 4 CO 2 (Mt/yr) 0.01 -0.22 -0.50 -0.68 -0.84 -0.83 -0.83 -0.83 -17.7 NOx (1,000 tons/yr) 0.01 -0.20 -0.44 -0.59 -0.71 -0.69 -0.69 -0.69 -15.1 SO 2 (1,000 tons/yr) 0.01 -0.14 -0.35 -0.49 -0.62 -0.61 -0.61 -0.61 -12.7 Hg (ton/yr) 0.000 -0.001 -0.002 -0.002 -0.001 -0.002 -0.002 -0.002 -0.045

Standard Level 5 CO 2 (Mt/yr) 0.01 -0.34 -0.75 -1.02 -1.26 -1.24 -1.24 -1.24 -26.7 NOx (1,000 tons/yr) 0.01 -0.30 -0.66 -0.88 -1.06 -1.04 -1.04 -1.04 -22.7 SO 2 (1,000 tons/yr) 0.01 -0.21 -0.53 -0.73 -0.93 -0.92 -0.92 -0.92 -19.2 Hg (ton/yr) 0.000 -0.002 -0.003 -0.002 -0.002 -0.003 -0.003 -0.003 -0.068

*CO 2 results are in metric tons, NO X , SO 2 , and Hg results are in short tons. Extrapolation15 -7 REFERENCES
1. U.S. Department of Energy–Energy Information Administration. 2012. Annual Energy Outlook 2012 . Washington, DC. http://www.eia.gov/forecasts/aeo/