Technical Support Document (TSD) for the CAA Section 111(d) Emission Guidelines for Existing Power Plants



# New Source Complements to Mass Goals Technical Support Document for CPP

Final Rule

U.S Environmental Protection Agency
Office of Air and Radiation August 201 52

**New Source Complements to Mass Goals under**  **111(d)** This Technical Support Document (TSD) provides information that supports the EPA’s quantification of new source complements in Section VIII.J of the preamble. These new source complements represent the EPA’s estimated new source emissions associated with satisfying incremental demand from 2012. States
may add these new source complements to the final rul e’s mass goals in pursuing a mass

-based compliance pathway inclusive of both affected EGUs and new fossil fuel

- fired sources. The methodology for quantifying these new source complements is presented in five steps:
1. Calculate incremental generation needed for each interconnection to satisfy projected load growth from 2012 levels 1 2. Subtract generation from under construction facilities included in the final rule 3. Subtract generation growth from affected EGUs and incremental renewable energy (RE) accounted for in the calculation of mass goals 4. Apportion remaining incremental generation to states on the basis of each state’s 2012 share of the interconnection’s affected EGU generation total2 5. Convert state

- level incremental generation to state

- level incremental emis sions by assuming the New Source Performance Standard emission rate for NGCC of 1,030 lbs/MWh The spreadsheet ‘New Source Complements’ is available in the docket and provides the complete set of calculations for each state.
**1. Calculate**  **incremental generation needed for each interconnection to satisfy projected load**  **growth from 2012 levels** For this step, the EPA relies on the projected net energy for load values from the Energy Information Administration’s (EIA’s) 2015 Annual Energy Outlook (AEO2015). 3 Those values are presented in Table 1 for the baseline year of 2012 and all years, 2022 through 2030.

**Table 1.**  **Net Energy for Load by Interconnection (TWh)**
**Year Eastern**  **Interconnection Western** 

**Interconnection Texas** 

**Interconnection** 2012 2,881 730 333 2022 3,094 775 361 2023 3,114 782 365 2024 3,137 789 369 2025 3,158 797 372 2026 3,178 803 376 2027 3,196 810 380

1 In this document, unless otherwise indicated, “incremental” means beyond the level observed in 2012. 2 Affected EGU generation total is equal to the 2012 adjusted baseline used to calculate goal rates 3 Net energy for load is defined by the EIA as the ne t generation of main generating units that are system

- owned or system

- operated, plus energy receipts minus energy deliveries3 2028 3,213 816 383 2029 3,231 823 387 2030 3,245 829 391 The AEO projections are then converted into a percent increase in net energy for load, relative to 2012, for each interconnection and each year. Conversion to a percent increase enables the EPA to apply the projected demand growth to 2012 historical data.

**Table 2. Increase in Net Energy for Load From 2012 (%)** 
**Year Eastern**  **Interconnection Western** 

**Interconnection Texas** 

**Interconnection** 2022 7.4% 6.2% 8.6% 2023 8.1% 7.1% 9.6% 2024 8.9% 8.2% 10.8% 2025 9.6% 9.2% 11.9% 2026 10.3% 10.1% 13.0% 2027 10.9% 11.0% 14.0% 2028 11.5% 11.9% 15.1% 2029 12.2% 12.8% 16.3% 2030 12.7% 13.6% 17.4%

The historical generation associated with each interconnection is calculated as 2012 historical sales adjusted to account for an average transmission loss factor of 7.51%: 4

 2012 Generation = 2012 Sales × (1+ Transmission Losses)

 2012 Eastern Interc onnection Generation = 2,626,988 GWh × 1.0751 = 2,824,274 GWh

 2012 Western Interconnection Generation = 671,260 GWh × 1.0751 = 721,672 GWh

 2012 Texas Interconnection Generation = 365,467 GWh × 1.0751 = 392,914 GWh For each year, 2022 through 2030, the incremental generation required to support demand growth is 2012 sales multiplied by the percent increase in net energy for load for that year. 5 For example:

 2030 Incremental Generation to Support Demand Growth in the Eastern Interconnection = 2,824,274 GWh × 12.7% = 357,353 GWh
Table 3 contains the incremental generation to support demand growth for each interconnection in each year: **Table 3. Incremental Generation to Support Demand Growth**  **(GWh)**

4 The 7.51% scala r represents an average historical difference between total net generation of electricity and retail sales of elec tricity. http://www.eia.gov/electricity/state/pdf/sep2010.pdf a 5 This relationship assumes that the international export/import balance remains constant at 2012 levels and all incremental demand is met with generation from the U.S.4 **Year Eastern**  **Interconnection Western** 

**Interconnection Texas** 

**Interconnection** 2022 209,623 44,887 33,605 2023 228,901 51,476 37,525 2024 251,878 59,148 42,332 2025 272,214 66,281 46,616 2026 291,203 72,570 51,229 2027 308,827 79,060 55,042 2028 325,981 85,759 59,323 2029 343,525 92,729 64,065 2030 357,353 98,181 68,244

**2. Subtract**  **generation from under construction facilities included in the final rule** The incremental generation to support demand growth calculated in step 1 would be served in part by the under construction facilities that are part of the final rule but not reflected in the 2012 historical data. Table 4 displays the under construction capacity that did not commence operations in 2012 for each facility type

– affected coal

- fired EGUs, affected natural gas

- fired EGUs, and nuclear units that are eligible for compliance. 6

**Table 4. Under Construction Facilities**  **by Interconnection (MW) Facility**  **Type Eastern**  **Interconnection Western** 

**Interconnection Texas** 

**Interconnection** NGCC 10,633 2,636 2,489 Coal 655 0 0 Nuclear 5,522 0 0
Each facility type is assigned an annual net capacity factor associated with the amount of generation expected to meet future demand. This capacity factor does not represent expected total annual output, but instead represents the portion of total annual output that will deduct from the incremental generation needed to support demand growth. 7 For example, and c onsistent with the application of building block 2, under construction NGCC is assigned a capacity factor associated with future demand of 55%; coal

- fired

6 Under construction facilities that commenced operation in 2012 are excluded from this adjustment due to the unknown impact their full

-year operations would have on the 2012 data. Instead, the assumed output of full

-year operations from these facilities i s reflected in each state’s adjusted 2012 baseline generation total, which is the basis for apportioning interconnection

- level new source complement generation to state

- level new source complement generation. 7 The amount of generation from under construct ion facilities that is expected to replace existing source generation is irrelevant to the calcu lation of new source emissions associated with satisfying incremental demand from 2012

.5

EGUs are assigned a capacity factor of 60%; and nuclear facilities are assigned a capacity factor of 66%. 8 The generation totals associated with applying these capacity factors to under construction facilities are shown in Table 5:
**Tab le**  **5. Incremental Generation Assumed to Meet Future Demand** 

**from Under Construction Facilities by Interconnection (GWh)**  **Facility Type**  **Eastern Interconnection**  **Western**

**Interconnection Texas** 

**Interconnection** NGCC 51,231 12,702 11,991 Coal 3,443 0 0 Nuclear 31,926 0 0

**3. Subtract**  **generation growth from affected EGUs and incremental RE accounted for in the calculation of mass goals**  The calculation of mass goals incorporates an amount of generation growth from both affected EGUs and RE that would serve to meet future demand requirements. 9 Consequently, because the estimated emissions from this particular incremental generation are already included in the mass goals, it is necessary to deduct this amount of generation, listed in Table 6, from the incremental generation needed to support demand growth that will inform the estimation of the new source complements

.

**Table 6** 
**. Affected EGU and RE Generation Growth Incorporated in** 

**Mass Goal Calculation (GWh)** 
**Year Eastern**  **Interconnection Western** 

**Interconnection Texas** 

**Interconnection** 2022 138,054 29,209 22,689 2023 131,858 27,898 21,670 2024 135,132 28,591 22,208 2025 149,186 31,565 24,518 2026 161,395 34,148 26,525 2027 164,934 34,897 27,106 2028 191,779 40,576 31,518 2029 218,279 46,183 35,873 2030 241,664 51,131 39,716
The amount of generation remaining after deducting the generation growth incorporated in mass goals is referred to as the new source complement generation, and it is defined as:

8 The 66% capacity factor assigned to nuclear is set at the same ratio o f future demand to total output (66% dedicated to future demand; total output of 90%) as under construction NGCCs in building block 2 (55% dedicated to future demand; total output of 75%) 9 For more information, please see section VII of the preamble and the CO2 Emission Performance Rate and Goal Com putation TSD6

 Interconnection

- level new source complement generation = Incremental generation to support demand growth

– Generation from under construction facilities dedicated to serving future demand (step 2)

– Generation growth from affected EGUs and RE assumed in the mass goal calculation (step 3) 10

 Eastern Interconnection new source complement generation in 2030 = 357,353 GWh

– 86,600 GWh

– 241,664 GWh = 29,090 GWh The new source complement generation for each interconnection in each year is provided below in Table 7:
**Table 7.**  **Interconnection**
**- Level**  **New Source Complement Generation (GWh)** 
**Year Eastern**  **Interconnection Western** 

**Interconnection Texas** 

**Interconnection** 2022

- 2,976

- 2023 10,443 10,876 3,864 2024 30,146 17,855 8,133 2025 36,428 22,015 10,107 2026 43,208 25,720 12,714 2027 57,294 31,462 15,945 2028 47,602 32,480 15,814 2029 38,647 33,844 16,200 2030 29,090 34,349 16,537

**4. Apportion remaining incremental generation to states on the basis of each state’s 2012 share of**  **the interconnection’s affected EGU generation total**  The apportionment of interconnection

- level new source complement generation to states is performed on the basis of each state’s 2012 adjusted share of the interconnection’s 2012 adjusted affected EGU generation. 11 For the purposes of this calculation, states that are in multiple interconnections are assigned the interconnection that contains the majority of that state’s territory. Each state’s new source complement generation share is provided in Table 8 below: 12

**Table 8.**  **Generation Shares for**  **State**
**- Level Apportionment** 

10 For the year 2022, this procedure yields negative incremental generation results in the Eastern and Texas Interconnections, because under

- construction capacity and the amount of generation growth already represented in the mass goals would suffice to meet projected load growth in that year. As a result, the new source complement generation in these instances is assigned a value of zero. 11 The goal rates are calculated based on adjusted 2012 genera tion data to reflect the impact of significant unit outages, estimated impact of normalizing hydropower output, and all under construction facilities 12 For full generation data, refer to ‘New Source Complements’ spreadsheet7 **State Interconnection**  **Share of Interconnection 2012 Affected EGU**  **Generation** 13 Alabama Eastern 5.0% Arkansas Eastern 2.4% Arizona Western 12.5% California Western 24.9% Colorado Western 10.9% Connecticut Eastern 0.8% Delaware Eastern 0.5% Florida Eastern 10.3% Lands of the Fort Mojave Tribe Western 0.3% Georgia Eastern 4.0% Iowa Eastern 1.8% Idaho Western 0.8% Illinois Eastern 4.8% Indiana Eastern 5.5% Kansas Eastern 1.5% Kentucky Eastern 4.4% Louisiana Eastern 2.9% Massachusetts Eastern 1.3% Maryland Eastern 1.0% Maine Eastern 0.2% Michigan Eastern 3.7% Minnesota Eastern 1.7% Missouri Eastern 3.9% Mississippi Eastern 2.4% Montana Western 3.7% Lands of the Navajo Nation Western 7.1% North Carolina Eastern 4.1% North Dakota Eastern 1.4% Nebraska Eastern 1.3% New Hampshire Eastern 0.4% New Jersey Eastern 1.8% New Mexico Western 4.6% Nevada Western 6.8%

13 Values rounded to tenth of a p ercent; for unrounded values refer to ‘New Source Complements’ spreadsheet8 New York Eastern 3.1% Ohio Eastern 5.6% Oklahoma Eastern 3.4% Oregon Western 4.0% Pennsylvania Eastern 7.4% Rhode Island Eastern 0.4% South Carolina Eastern 2.0% South Dakota Eastern 0.3% Tennessee Eastern 2.1% Texas Texas 100.0% Lands of the Uintah and Ouray Reservation Western 0.7% Utah Western 8.6% Virginia Eastern 2.7% Washington Western 4.7% Wisconsin Eastern 2.1% West Virginia Eastern 3.6% Wyoming Western 10.4%
The new source complement generation level for a state is defined as:

 State

- level new source complement generation = Interconnection

- level new source complement generation × 2012 state share of interconnection affected EGU generation

 2030 Alabama new sourc e complement generation = 29,090 GWh × 5.0% = 1,467 GWh
State

- level new source complement generation totals are provided for each state in each year in the ‘ New Source Complements ’ spreadsheet.
**5. Convert state** 

**- level generation to state** 

**- level emissions**  **assuming the emissions intensity of the**  **New Source Performance Standard emission rate for NGCC of 1,030 lbs/MWh**  Each state

- level new source complement generation level is multiplied by the NSPS NGCC emission rate standard of 1,030 lbs/MWh to produce a mass value:

 New source complement = State

- level new source complement generation × NSPS NGCC emission rate standard

 2030 Alabama new source complement = 1, 467 GWh × 1,030 lbs/MWh = 755,700 short tons New source complements are calculated for each year and each state, from 2022 through 2030. The interim period new source complement is equal to the average of the annual values from 2022 through9

2029. The final period new source complement is equal to the 2030 value. The interim and final period new source complements are provided in Table 9 below: 14

**Table 9.**  **Average Annual New Source Complement (Short Tons)** 

**State Interim Period**  **Final Period**

Alabama 856,524 755,700 Arizona 1,424,998 2,209,446 Arkansas 411,315 362,897 California 2,846,529 4,413,516 Colorado 1,239,916 1,922,478 Connecticut 135,410 119,470 Delaware 78,842 69,561 Florida 1,753,276 1,546,891 Georgia 677,284 597,559 Idaho 94,266 146,158 Illinois 818,349 722,018 Indiana 939,343 828,769 Iowa 298,934 263,745 Kansas 260,683 229,997 Kentucky 752,454 663,880 Louisiana 484,308 427,299 Maine 40,832 36,026 Maryland 170,930 150,809 Massachusetts 225,127 198,626 Michigan 623,651 550,239 Minnesota 286,535 252,806 Mississippi 410,440 362,126 Missouri 668,637 589,929 Montana 421,674 653,801 Nebraska 216,149 190,706 Nevada 770,417 1,194,523 New Hampshire 71,419 63,012

14 Final and interim period new source complements are rounded up to the nearest ton. Total mass values for each period are available in the ‘New Source Complements’ spreadsheet, av ailable in the docket.10 New Jersey 313,526 276,619 New Mexico 527,139 817,323 New York 522,227 460,753 North Carolina 692,091 610,623 North Dakota 245,324 216,446 Ohio 949,997 838,170 Oklahoma 581,051 512,654 Oregon 453,663 703,399 Pennsylvania 1,257,336 1,109,330 Rhode Island 70,035 61,791 South Carolina 344,885 304,287 South Dakota 46,513 41,038 Tennessee 358,838 316,598 Texas 5,328,758 8,516,408 Utah 981,947 1,522,500 Virginia 450,039 397,063 Washington 531,761 824,490 West Virginia 602,940 531,966 Wisconsin 364,841 321,895 Wyoming 1,185,554 1,838,190 Lands of the Navajo Nation 809,562 1,255,217 Lands of the Uintah and Ouray Reservation 84,440 130,923 Lands of the Fort Mojave Tribe 37,162 57,619