1. Rationale for Combining the Subpart Da Category and a

Component of the Subpart KKKK Category into a New Category for GHGs The EPA is proposing to create a new subpart in 40 CFR part 60 by combining the sources in subpart Da (the Da category ) and component s of sources in subpart KKKK (the KKKK category)

–– combined cycle unit s, but not simple cycle units
-- for purposes of promulgat ing standards of performance for emissions of GHGs from new sources. This new subpart will be numbered TTTT. At this time, the EPA is not proposing subcategories for new sources and is not combining the Da category and component s of the KKKK category for conventional pollutants. CAA section 111 provides legal authority for combining the categories into a new category . C lean Air Act section 111(b)(1)(A) provides: The Administrator shall, within 90 days after December 31, 1970, publish (and from time to time thereafter shall revise) a list of categories of stationary sources. He shall include a category of sources in
s uch a list if in his judgment it causes or contributes significantly to air pollution which may reasonably be anticipated to endanger public health or welfare. (Emphasis added.)As quoted, this provision grants to the Administrator

the authority to “revis e” the list of categories. Combining categories, in whole or in part, is a form of “revis[ing]” the list of categories (along with taking other actions, such as adding more categories or delisting categories) , and accordingly is authorized. It is reasonab le for the EPA to combine the Da category and the combined cycle component of the KKKK category at this time for purposes of GHGs, for several related reasons. First, both types of plants (boilers and combined cycle units ) perform the same function, which is to generate electricity. It is sensible to treat as part of the same category units that generate electricity, regardless of their design or fuel type . Second, although it is true that natural gas - fired plants are inherently less emitting than coal
- fired plants, all newly constructed sources have options in selecting their design. As a result, prospective owners and operators of new sources could comply with the proposed emission standards by choosing to construct a NGCC facility. These two factors provide sufficient legal rationale for EPA to combine the Da category and the combined cycle component of the KKKK category for purposes of GHGs . A third factor lends further support. Combining the categories does not raise adverse policy concerns. Based on comments made during the listening sessions, we anticipate thatsome commenters may express concern that combining the

categories and applying the NGCC standard may limit construction of new coal - fired power plants, which would have adverse implications for energy diversity. We do not believe that this action would have those effects. As discussed below, modeling of the power sector, which is based on economic factors, forecasts
no new coal - fired construction through the modeling period , which lasts until 2020. Accordingly, economic conditions may be expected to be the main driver precluding, or at least limiting, construction of coal
- fired EGUs. Even so, we recognize the possibility that a limited amount of new coal
- fired construction
may nevertheless occur. Today’s action would not foreclose construction of new coal
- fired EGUs . Rather, the small number of new coal - fired EGUs that may be expected to be built in the foreseeable future may install CCS control equipment (if not at the time of construction, then relatively soon thereafter) and, by doing so, achieve the same emission rate (at least over time)
as a natural gas - fired EGU. As discussed below, CCS is both feasible and sufficiently available, although not the least
- cost choice, as evidenced by the fact that power companies have announced plans to incorporate CCS at seven already permitted coal - fired EGU construction projects in this country (as we discuss below in section V.B., concerning transitional sources) . Programs exist that provide some funding for CCS through pilotor other demonstration programs , and we expect those to

continue. In addition, we reasonably expect the cos ts of CCS to decline over time. As discussed below , we are not proposing that CCS does or does not qualify as the “best system of emission reduction” that “has been adequately demonstrated . ” Rather, the feasibility of CCS and its availability for the limited amount of new coal
- fired construction that may be expected, means that this action to combine the categories and establish the NSPS at the proposed emissions limit will not have adverse effects on new coal - fired construction or, therefore, on energy diversity. In fact, this action could promote coal
- fired construction by eliminating the current uncertainty about the prospect of GHG controls . On the other hand, at this time, we do not consider it appropriate to include simple cycle facilities as an affected source in the new 40 CFR part 60, subpart TTTT for GHG emissions from new facilities . The reason for this is that the function of a new simple cycle power plant is different than that of a new combined cycle plant or coal
- fired plant. Combined cycle plants and coal - fired plants are typically designed to provide base
load or intermediate
- load power, while simple cycle turbines are designed to provide peaking power . Because combined cycle power plants and coal - fired power plants both serve the same purpose and have design options to emit CO 2 at similar levels, we believeit is appropriate to combine them. Be cause peaking turbines

operate less and because it would be much more expensive to lower their emission profile to that of a combined cycle power plant or a coal - fired plant with CCS, the EPA does not believe it is appropriate to include them in this source category. By the same token, at this time, we do not consider it appropriate to combine the Da category and the combined cycle component of the KKKK category for any pollutants other than GHGs, that is, for conventional pollutants. This is because although coal - fired EGUs have an array of control options for conventional pollutants to choose from, those controls generally do not reduce their conventional emissions to the level of conventional emissions from natural gas - fired EGUs.