Ensuring a Clean, Modern Electric Generating Fleet while Maintaining Electric System Reliability | SUMMER 2011 UPDATE

M. J. Bradley & Associates LLC 1 Analysis Group 

# Ensuring a Clean, Modern Electric Generating Fleet while Maintaining Electric System Reliability

June 2011 

## S UMMER 

## 2011 U PDATEEnsuring a Clean, Modern Electric Generating Fleet while Maintaining Electric System Reliability | SUMMER 2011 UPDATE

M. J. Bradley & Associates LLC 2 Analysis Group 

# Acknowledgements

The following report was prepared on behalf of the Clean Energy Group’s Clean Air Policy Initiative, a coalition of electric companies dedicated to respon sible energy and environmental stewardship.  The participating companies (listed below) are some of the nation’s largest generators of electricity, wit h over 146,000 megawatts of electric generating capacity ( including 93,000 megawatts of fossil generating cap acity) throughout the U.S.

Calpine Corporation Constellation Energy Exelon Corporation NextEra Energy

National Grid PG&E Corporation Public Service Enterprise Group

REPORT AUTHORS

Michael J. Bradley, M.J. Bradley & Associates LLC Susan F. Tierney, Analysis Group Christopher E. Van Atten, M.J. Bradley & Associates LLC Amlan Saha, M.J. Bradley & Associates LLC

For questions or comments about this report, please contact:

Christopher Van Atten M.J. Bradley & Associates LLC 47 Junction Square Drive Concord, MA  01742 Telephone: 978 369 5533 E­mail: vanatten@mjbradley.comEnsuring a Clean, Modern Electric Generating Fleet while Maintaining Electric System Reliability | SUMMER 2011 UPDATE

M. J. Bradley & Associates LLC 3 Analysis Group 

# Executive Summary

In August 2010, M.J Bradley & Associates and Susan Tierney of the Analysis Group were commissioned to prepare a study on the impact of two major U.S. Env ironmental Protection Agency (“EPA”) air regulation s affecting the electric power sector: (1) the Clean Air Transport Rule (“Transport Rule”) and (2) the n ational emission standards for hazardous air pollutants fro m coal­ and oil­fired electric utility steam genera ting units (“Utility Toxics Rule”).  The study concluded that the electric industry is well­positioned to comply with EPA’s proposed air regulations without threatening electr ic system reliability.

This “Summer 2011 Update” supplements the original analysis in light of new information and reaffirms the major conclusion of the prior report that the elect ric industry can comply with EPA’s air pollution ru les without threatening electric system reliability provided th at EPA, the industry and other agencies take practi cal steps to plan for the implementation of these rules and adop t appropriate regulatory approaches.  Proper planni ng and implementation can secure important public health b enefits, reliable electric service, and efficient m arket

outcomes.

Since our analysis was released in August 2010, EPA has published its proposed Utility Toxics Rule and should be close to issuing the final Transport Rule.

1. EPA has proposed achievable standards for coal­fire d power plants for mercury, acid gases, and other hazardous air pollutants.  The proposed emiss ion limits are well within the capability of existi ng pollution control technology, and allow options for cost­effective compliance strategies.

o The Utility Toxics Rule proposes emissions standard s for existing coal­fired power plants for mercury, particulate matter ("PM"), and hydrochloric acid (" HCl").  Companies can choose any combination of control systems or operational changes that enable them to achieve the proposed limits.

o Nearly 60 percent of all coal­fired boilers that su bmitted stack test data to EPA are currently achiev ing the Utility Toxics Rule's proposed mercury emission s standard. 1 This translates to more than 100 boilers (out of a total of 178).  These power plant s are meeting the proposed standard with a wide variety of pollution control systems and configurat ions (e.g., wet scrubbers, dry scrubbers, baghouses

, and carbon injection systems).

o Many states already impose more stringent mercury e missions limits on coal­fired power plants than have been proposed by EPA; these states, where plan ts are already in compliance with those stricter standards, include Illinois, Massachusetts, New Jer sey, Connecticut, Delaware, and New York.

o About 70 percent of all coal­fired boilers that sub mitted stack test data to EPA are currently achievi ng the proposed standards for PM and HCl.  Close to 16 0 coal­fired generating units report emissions below the level of the proposed HCl standard (out o f 217), and close to 120 units report emissions below the proposed PM standard (out of 172). All of the proposed standards (mercury, PM, and HCl) allow companies to average their emissions across m ultiple boilers at a single facility.  Smaller boil ers, which may only operate a limited number of hours ea ch year, may comply without any major capital upgrades if co­located with a better­controlled boi ler.  Almost 20 percent of existing coal capacity t hat currently lacks "scrubbers" is co­located at plants with existing scrubbers.  These units can potentia lly

1 Based on EPA’s revised standard of 1.2 pounds per trillion British thermal units (lb/TBtu).Ensuring a Clean, Modern Electric Generating Fleet while Maintaining Electric System Reliability | SUMMER 2011 UPDATE

M. J. Bradley & Associates LLC 4 Analysis Group benefit from the averaging provisions of the rule, reducing the costs and potential retirements from t he Utility Toxics Rule, as well as avoiding any relate d reliability issues.

o EPA has proposed a "work practice standard" to cont rol emissions of dioxins and furans, rather than setting a numeric emissions limit.  The work practi ce standard requires "good combustion practices" to limit the formation of organic HAPs.

o Several studies, published before EPA issued its Ut ility Toxics Rule, have projected widespread coal plant retirements in the U.S.  The higher end proje ctions are likely overstating future levels of retirements given what we now know about EPA's prop osed approach and the market response to date.

2. Recent corporate financial statements and other rec ent announcements confirm that at least some of the nation’s largest coal­fired generating companie s are well positioned to comply with EPA’s proposed air quality rules.

o Benjamin G.S. Fowke, III, President and Chief Opera ting Officer of Xcel Energy, said: "Like many of our peers, we are in the process of evaluating what if any impact [EPA's Utility Toxics Rule] may have on our operations.  Based on our preliminary review we do not anticipate that the rule will require extensive changes to our plans at [Northern States Power] and [Public Service Company of Colorado]...Our proactive steps to reduce emissions t hrough the MERP project in Minnesota and our plans for the Clean Air­Clean Jobs Act in Colorado put us in good position to comply with these rules. " April 28, 2011, Xcel Energy Inc. 1st Quarter 2011 E arnings Call

o Jim Rogers, President and CEO of Duke Energy, said: "[T]he anticipation of more stringent environmental rules has long been part of our busin ess plan.  Over the past 10 years, we have spent $5 billion retrofitting existing units with updated em issions controls...Today, approximately 75% of our current coal generation capacity has scrubbers in o peration.  This will increase to approximately 90%, once our fleet modernization program and related re tirements are completed...We have really mitigated

a lot of the risk and the cost associated with this program by the early steps that we took." May 3, 2011, Duke Energy 1st Quarter 2011 Earnings Call

o According to Gale Klappa, Chairman, President and C EO of Wisconsin Energy: "We really see very little impact on customer electric rates or our cap ital plan between now and 2015 as a result of all t he new EPA regulations that have been proposed...We migh t see 1% to 2% increase our best guess [sic]. So that gives you an example of how well we are pos itioned from the environmental standpoint in terms of complying with even the new proposed rule." May 3, 2011, Wisconsin Energy Corporation 1st Quarter 2011 Earnings Call

o Reacting to EPA's proposed Utility Toxics Rule, The odore Craver, chairman, president and CEO of

Edison International said: "We installed the necess ary equipment back in 2009 and are already achieving these [mercury] limits.  U.S. EPA's rule contained other draft provisions covering acid gase s and non­mercury metals, which we can meet by instal ling the pollution control equipment we have been planning to use at Midwest Gen to meet our SO 2 emissions commitments to the Illinois EPA." May 2, 2011, Edison International 1st Quarter 2011 Earning s Call

o William Spence, Chief Operating Officer, Executive Vice President and President of PPL Generation, said: "Our proactive approach to environmental comp liance positions the PPL fleet favorably for future EPA regulation.  Ninety­six percent of the competit ive coal generation is scrubbed, 88 percent has NOx controls already installed." February 4, 2011, PPL 4th Quarter 2010 Earnings Cal lEnsuring a Clean, Modern Electric Generating Fleet while Maintaining Electric System Reliability | SUMMER 2011 UPDATE

M. J. Bradley & Associates LLC 5 Analysis Group o Mauricio Gutierrez, Executive Vice President and Ch ief Operating Officer of NRG reports that: "The proposed [Utility Toxics Rule] provides flexibility in that compliance can be achieved through facilit y averaging and company selected control technology. It also recognizes the inherent differences in mercury emissions from lignite coal...[t]he key takea way is that we do not expect at this time any additional environmental CapEx beyond what we have previously announced." May 5, 2011, NRG Energy 1st Quarter 2011 Earnings Call

o The Tennessee Valley Authority ("TVA"), which owns 17,000 megawatts ("MW") of coal­fired generating capacity, announced plans in April 2011 to retire 18 older coal­fired generation units at t hree power plants ( 2,700 MW) as part of the utility's v ision of being one of the nation's leading provider s of low­cost and cleaner energy by 2020.  The utility w ill replace "older and less­economical generation with cleaner sources."  Tom Kilgore, TVA's Presiden t and CEO, said that a "variety of electricity sources, rather than heavy reliance on any single s ource, reduces long­term risks and helps keep costs steady and predictable....In the longer term, these a ctions reinforce our vision to keep bills low, keep our service reliability high and further improve ai r quality as we modernize the TVA power system." TVA Press Release, April 14, 2011.

3. The results of PJM’s most recent Reliability Pricin g Model (“RPM”) forward capacity auction clearly indicate the industry can meet future electricity d emand while maintaining electric system reliability in one of the most coal­dependent regions of the co untry.

o On May 13, 2011, PJM announced the results of its R PM forward capacity auction for the period from May 31, 2014 through June 1, 2015.  Both the Transp ort Rule and the Utility Toxics Rule will be in effect by the beginning of 2015.  These results pro vide up­to­date information about how the region's reliability organization will ensure sufficient cap acity to meet peak demand conditions after the proposed EPA air regulations go into effect.

o PJM operates the nation's largest integrated power market, serving 54 million customers in 13 midAtlantic and Midwestern states, including all or pa rts of Delaware, Illinois, Indiana, Kentucky, Maryland, Michigan, New Jersey, North Carolina, Ohi o, Pennsylvania, Tennessee, Virginia, West Virginia, and the District of Columbia.

o To ensure future electric system reliability, PJM's forward capacity auction requires power plant operators and other participating companies to offe r (i.e., commit) resources, including both generati ng capacity and demand­side resources, three years in advance of when they are needed. 2

o The results of the most recent auction confirm that the 13­state PJM region will have ample electricit y supply after EPA's Transport and Utility Toxics Rul es take effect.  The market response represents a 20.6 percent reserve margin for the region.  The en ergy resources selected to serve the region include d new generating resources, capacity upgrades to exis ting power plants, new demand response resources, and new commitments to energy efficiency.

o The resources that bid into but fail to "clear the auction" (i.e., to be selected as the lowest­cost c apacity resources) are not needed for reliability purposes. Generating units that did not clear have the opti on to retire.  In the most recent auction, existing fossi l generating units that failed to clear were offset by new generating resources, energy efficiency, and demand response that offered their capacity at lower pric es.

o Numerous analyst reports have attempted to predict future levels of coal plant retirements with estimates ranging from 10 to 70 GW.  The PJM forwar d capacity auction is where the "rubber­meets­

2 There are exceptions to this requirement (e.g., wh en a company relies on its own generating resources to satisfy its load requirements).  See infra n.21.Ensuring a Clean, Modern Electric Generating Fleet while Maintaining Electric System Reliability | SUMMER 2011 UPDATE

M. J. Bradley & Associates LLC 6 Analysis Group the­road," reflecting actual market investment beha vior, signaling that sufficient power will be avail able

after EPA's air rules take effect.

4. EPA has the statutory authority under the Clean Air Act to grant, on a case­by­case basis, extensions of time to complete the installation of pollution c ontrol systems.

o EPA emphasizes in its proposed Utility Toxics Rule that it has the discretion to grant, on a case­by­c ase basis, extensions of time to complete the installat ion of pollution control systems where appropriate.

o This provision provides companies with the flexibil ity to schedule the installation of controls across multiple outage periods—maintaining electric system reliability while facilitating the expeditious installation of modern pollution control systems.

o Permitting authorities have used this provision in the past under previous MACT rules.

o If four years is still not enough time to install t he necessary controls, EPA and the Department of Energy have the authority to enter into administrat ive orders of consent or consent decrees with power plants, allowing them to run under specific and lim ited circumstances to maintain reliability.  This approach ensures that reliability standards are mai ntained without an across­the­board delay in the implementation of the rules.Ensuring a Clean, Modern Electric Generating Fleet while Maintaining Electric System Reliability | SUMMER 2011 UPDATE

M. J. Bradley & Associates LLC 7 Analysis Group A.  EPA has proposed achievable standards for coal­f ired generating units for mercury, acid gases, and other hazardous air pollutants

In December, 2000, the U.S. Environmental Protectio n Agency (“EPA”) issued a formal notice concluding that it was “appropriate and necessary” to regulate hazardous air pollutants (“HAPs”) from the electri c power sector under Section 112 of the Clean Air Act .  The finding specifically referenced concerns associated with mercury, arsenic, chromium, nickel, cadmium, dioxin, hydrogen chloride, and hydrogen fluoride.  Almost 11 years later, EPA has issued it s proposed rule. 3

The proposed standards for existing coal­fired gene rating units are summarized in Table 1 below.

Table 1 – Proposed Standards for Existing Coal­Fire d Generating Units

HAP or HAP Surrogate Proposed Standard

Particulate matter 0.030 lb/MMBtu

Hydrogen chloride 0.0020 lb/MMBtu

Mercury (units designed for coal ≥ 8,300 Btu/lb) 1.2 lb/TBtu 4

Mercury (units designed for coal < 8,300 Btu/lb) 4.0 lb/TBtu

Note: **The Utility Toxics Rule also proposes “output-base d” emissions standards for coal-fired generating un**  **its (i.e., standards expressed in pounds per megawatthour “MWh”). Compa**  **nies can demonstrate compliance based on either the “input-based” standards**  **listed above (in million Btu “MMBtu” of heat input) or the output-based limits.** 

Coal­fired generating units emit over 100 chemicals on EPA’s list of HAPs—pollutants that are known or suspected to cause cancer or other serious health e ffects, such as reproductive problems or birth defe cts, and that adversely affect the environment. 5 Rather than requiring companies to comply with s tandards for each individual HAP emitted from coal­fired generating u nits, however, EPA has proposed the use of “surrogates,” simplifying the monitoring and compli ance requirements of the rule.  For example, partic ulate matter (“PM”) has been proposed as a surrogate for all non­mercury metal HAPs, including arsenic, cadmium, chromium, and lead.  Hydrogen chloride (“H Cl”) is being used as a surrogate for all acid gas HAPs.  No surrogate was used for mercury.

EPA’s proposed standards were calculated based on a n extensive data collection effort, involving hundr eds of stack tests at coal­fired generating units throu ghout the country.  The Clean Air Act requires that EPA’s standards reflect the performance of the “best perf orming” facilities within the category or subcatego ry.

Figure 1 compares the proposed standard for mercury 6 with the stack test results from 178 coal units th at conducted stack emissions testing in 2010 as part o f EPA’s Information Collection Requests (“ICR”) emissions testing program.  The results show that n early 60 percent of all coal­fired generating units that submitted stack test data to EPA are currently achi eving the proposed mercury emissions standard.   Th is translates to more than 100 units (out of a total o f 178).

3 U.S. Environmental Protection Agency (“EPA”), National Emission Standards for Hazardous Air Pollu tants From Coal and Oil­Fired Electric Utility Steam Generating Units and Standards of Performance for Fossil­Fuel­Fired Electric Utility, Industrial ­Commercial­Institutional, and Small IndustrialCommercial­Institutional Steam Generating Units ,  Federal Register / Vol. 76, No. 85 / Tuesday, Ma y 3, 2011.

4 EPA’s proposed mercury emissions standard for exis ting electric generating units designed for coal ≥ 8,300 Btu/lb was revised on May 18, 2011.  The standard was adjusted from 1.0 lb/TBtu to 1.2 lb/TB tu.

5 EPA, Study of Hazardous Air Pollutant Emissions from Ele ctric Utility Steam Generating Units —Final Report to Congress , EPA–453/R–98–004a, February 1998.

6 Only about 30 coal­fired generating units in the U .S. would be subject to the mercury standard for un its designed for coal with a heat content of less t han 8,300 British thermal units per pound (Btu/lb); the refore, we focus our analysis on the mercury standa rd for units designed for coal ≥ 8,300 Btu/lb. 

### I. E PA’S P ROPOSED 

### U TILITY 

### T OXICS 

### R ULEEnsuring a Clean, Modern Electric Generating Fleet while Maintaining Electric System Reliability | SUMMER 2011 UPDATE

M. J. Bradley & Associates LLC 8 Analysis Group Figure 1 also shows that the power plants meeting t he proposed standard have a wide variety of polluti on control systems and configurations that are reducin g their mercury emissions.  Many of the units that are below the level of the standard have been retrofit with a scrubber (wet or dry) or activated carbon in jection (“ACI”).  Virtually all of the units with a “baghou se” or fabric filter (“FF”) report emissions well b elow the level of the proposed mercury standard.  In many ca ses, these mercury reductions are being achieved as a co­benefit of existing state and federal pollution control programs aimed at reducing SO 2 and other air pollutants.  In some cases, states have adopted mer cury control requirements because of the slow pace of the federal rulemaking process.  Appendix A provides de tails on the existing state mercury control requirements.  Several states already impose more s tringent mercury emissions limits on coal­fired pow er plants than what has been proposed by EPA, includin g: Illinois, Massachusetts, New Jersey, Connecticut

, Delaware, and New York.

Figure 1 – Proposed Mercury Emissions Standard and ICR Stack Test Results

Note: **In order to better reflect the detail of the graph , the lower portion of the figure highlights a narr**  **ow band of the upper bar graph (i.e., the area below 2 lb/Tbtu).** 

Figure 2 compares the proposed standard for PM with the stack test results from 172 coal­fired generat ing units that conducted stack emissions testing in 201 0.  The results show that nearly 70 percent of all coalfired generating units that submitted stack test da ta are currently achieving the proposed PM emission s standard.  This translates to more than 119 units ( out of a total of 172).

Figure 3 compares the proposed standard for HCl wit h the stack test results from 217 coal­fired genera ting units that conducted stack emissions testing in 201 0.  The results show that 73 percent of all coal­fi red generating units that submitted stack test data are currently achieving the proposed HCl emissions sta ndard. This translates to 158 units (out of a total of 217 ). **0.00E+00 5.00E-07**  **1.00E-06 1.50E-06**  **2.00E-06**

**100% 89% 78% 66% 55% 44% 33% 21% 10% 0.00E+00**  **5.00E-06 1.00E-05**  **1.50E-05 2.00E-05**  **2.50E-05 3.00E-05**  **3.50E-05 4.00E-05**  **4.50E-05**

**100% 89% 78% 66% 55% 44% 33% 21% 10%**

**Bituminous & Sub-bituminous Coal-fired Units in ICR Dataset (%)**  **EPA Proposed Limit: 1.2 45** 

**40**

**35**

**30**

**25**

**20**

**15**

**10**

**5**

**2**

**1.5**

**1**

**0.5 Reported**  **Mercury**

**Emission (lb/TBtu)**  Summary of Source Units

**No. of total sources in sub category**  **1,061**

**No. of source units in sub category in ICR database**  **178**

**No. of source units in ICR database that reported** 

**emission rates below the EPA proposed limit**  **101 Neither Scrubber nor ACI** 

**Scrubber + ACI**
**ACI (No Scrubber)**

**Dry Sorbent Injection**

**Scrubber - Wet**

**Scrubber - Dry**

**PM Type ESP**

**PM Type FF**Ensuring a Clean, Modern Electric Generating Fleet while Maintaining Electric System Reliability | SUMMER 2011 UPDATE

M. J. Bradley & Associates LLC 9 Analysis Group

Figure 2 – Proposed PM Emissions Standard and ICR S tack Test Results

Figure 3 – Proposed HCl Emissions Standard and ICR Stack Test Results

Note: **In order to better reflect the detail of the graph, the lower portion of the figure highlights a narro**  **w band of the upper bar graph (i.e., the area below 0.004 lb/MMBtu).**  **0.000 0.001**  **0.002 0.003** 

**100% 90% 81% 72% 63% 54% 44% 35% 26% 17% 8% 0.000**  **0.020 0.040**  **0.060 0.080**  **0.100 0.120**  **0.140 0.160**  **0.180**

**100% 90% 81% 72% 63% 54% 44% 35% 26% 17% 8% Reported** 

**HCl**

**Emission (lb/MMBtu)** 

**Coal-fired Units in ICR Dataset (%) EPA Proposed: 0.0020**  **Neither Scrubber nor ACI**

**Scrubber + ACI**
**ACI (No Scrubber)**
**Dry Sorbent Injection**

**Scrubber - Wet**
**Scrubber - Dry**
**PM Type ESP**

**PM Type FF** Summary of Source Units

**No. of total sources in sub category**  **1,091**

**No. of source units in sub category in ICR database**  **217**

**No. of source units in ICR database that reported** 

**emission rates below the EPA proposed limit**  **158 Reported** 

**Total PM**

**Emission (lb/MMBtu)** 

**Coal-fired Units in ICR Dataset (%) EPA Proposed: 0.030** 

**0.000 0.050**  **0.100 0.150**  **0.200 0.250** 

**100% 88% 77% 65% 53% 42% 30% 19% 7% Neither Scrubber nor ACI** 

**Scrubber + ACI**

**ACI (No Scrubber)**

**Dry Sorbent Injection**

**Scrubber - Wet**

**Scrubber - Dry**

**PM Type ESP**

**PM Type FF** Summary of Source Units

**No. of total sources in sub category**  **1,091**

**No. of source units in sub category in ICR database**  **172**

**No. of source units in ICR database that reported** 

**emission rates below the EPA proposed limit**  **119 Total PM = PM (filterable) + PM2.5 (Condensible)** Ensuring a Clean, Modern Electric Generating Fleet while Maintaining Electric System Reliability | SUMMER 2011 UPDATE

M. J. Bradley & Associates LLC 10 Analysis Group B.  The averaging provisions of the Utility Toxics R ule, and work practice standards for dioxins and furans, reduce the costs and potential retireme nts from the rule

Most coal­fired power plants have multiple boilers and electric generating units at a single plant loc ation. The Utility Toxics Rule would allow companies to de monstrate compliance by averaging their emissions across multiple units at an affected source.  This flexible compliance option is particularly helpful to smaller generating units that are co­located with larger ge nerating units, but may not be economic to retrofit with pollution control systems.

Smaller boilers, which may only operate a limited n umber of hours each year, may comply without any major capital upgrades if co­located with a better­ controlled boiler.  Almost 20 percent of existing c oal capacity that currently lacks “scrubbers” is co­loc ated at plants with existing scrubbers.  These unit s can potentially benefit from the averaging provisions o f the rule, reducing the costs and potential retire ments from the Utility Toxics Rule, as well as avoiding a ny related reliability issues.

EPA has proposed a “work practice standard” to cont rol emissions of dioxins and furans, rather than se tting a numeric emissions limit.  The work practice stand ard requires “good combustion practices” to limit t he formation of organic HAPs.  Companies would perform an annual performance test to ensure efficient fue l

combustion.

C.  The majority of U.S. coal plants have already in stalled air pollution controls

As highlighted in our August 2010 report, many coal plants have already installed pollution control technologies to dramatically reduce their air pollu tion emissions, including NOx, SO 2 , mercury, and other

HAPs.

• About 60 percent of the U.S. coal fleet (192 GW) ha s scrubbers installed or under construction. Scrubbers capture sulfur dioxide (“SO 2 ”), mercury, HCl, and PM emissions. 7 Among large coal

‐ fired generating units—units greater than 400 megaw atts (“MW”)—more than 70 percent have scrubbers installed.  Scrubbers are the most capita l intensive technology that a company would potentially need to install to comply with the Util ity Toxics Rule.

• About 35 percent of the U.S. coal fleet (112 GW) ha s fabric filters installed.  Fabric filters (or baghouses) can dramatically reduce PM and mercury e missions. 8

• About 50 percent of the U.S. coal fleet (158 GW) ha s advanced post­combustion NOx controls installed—selective catalytic reduction (“SCR”) or selective non­catalytic reduction (“SNCR”). 9

• More than 70 percent of the U.S. coal fleet has ele ctrostatic precipitators (“ESPs”) installed for PM control, although many are older systems designed f or lower levels of performance. 10 Companies may need to upgrade their ESPs or replace them with baghouses to comply with the PM limits proposed in the Utility Toxics Rule.

Additionally, new technologies are available that c ompanies will be using to comply with EPA’s new air rules.  In particular, dry sorbent injection (“DSI” ) has emerged as a low­capital­cost alternative to installing

a scrubber.  DSI can be used to control SO 2 and other acid gases through the injection of a ch emical reagent, including sodium bicarbonate, hydrated lime, and a natural occurring mixture of sodium carbonate and

7 Northeast States for Coordinated Air Use Managemen t (“NESCAUM”), Control Technologies to Reduce Conventional and Haz ardous Air Pollutants from Coal­Fired Power Plants , March 31, 2011.

8 Id.

9 Id.

10 Id.Ensuring a Clean, Modern Electric Generating Fleet while Maintaining Electric System Reliability | SUMMER 2011 UPDATE

M. J. Bradley & Associates LLC 11 Analysis Group sodium bicarbonate called Trona .  Relative to a scrubber, DSI not only has low cap ital costs but can also generally be installed within 12 months.  DSI costs have been estimated at $55 per kilowatt (“kW”). 11

Midwest Generation estimates that it can retrofit i ts entire coal fleet with DSI and fabric filters wi thin 12 to 24 months (of decision) at a cost of $232/kW. 12 By contrast, a scrubber alone can cost over $400 /kW. 13

Generally, DSI will be considered for coal units bu rning low sulfur Powder River Basin (“PRB”) coal. Other factors that will drive the deployment of DSI include unit size, percentage reduction of emissio ns required, plant economics, and site specific charac teristics.  DSI has been deployed at several coal­f ired generating units in the U.S., including:

• In 2010, NRG’s Dunkirk and Huntley power plants ins talled DSI systems that simultaneously inject Trona and powder­activated carbon (“PAC”).  Perform ance tests indicate that emissions of SO 2 have been reduced by over 55 percent, mercury level s have been reduced by over 90 percent, and particulate levels have been reduced to less than 0 .010 lb/MMBtu.  NRG considers these installations sufficient and expects no additional environmental capex requirements to comply with the Utility Toxics and Transport rule. 14

• Duke Energy installed DSI systems in 2010 at its Ga llagher generating station.  According to the company, the estimated total cost of the DSI system , installed at Units 2 and 4, was $11.6 million or about $41/kW.  The system will reduce SO 2 emissions by 50 percent.  Duke Energy expects the DSI system to help the company comply with the requirem ents of the Utility Toxics Rule and Transport

Rule. 15

• GenOn operates a DSI system at its Potomac River Ge nerating Station in Alexandria, Virginia. According to the company, the Potomac River plant h as seen up to 80 percent reduction in SO 2 emissions since introducing the trona­based system. 16

• Midwest Generation is seeking to retrofit its coal fleet (12 coal­fired units in the Midwest with tota l capacity of about 5 GW) with DSI technology and upg rade its particulate control systems at a total
estimated cost of $1.2 billion. 17 In November 2010 and February 2011, Midwest Gene ration obtained construction permits from the Illinois Env ironmental Protection Agency to install DSI systems at its Waukegan and Powerton generating sta tions. 18

• Conectiv Energy installed a Trona based DSI system at its Edge Moor plant (Units 3 and 4) and operated it from 2009 to mid­2010 on bituminous coa l.  The plant has since been converted to run on natural gas obviating the need for the DSI syste m. 19

11 EPA, Documentation Supplement for EPA Base Case v4.10_PT ox­ Updates for Proposed Toxics Rule , March 2011.

12 Bernstein Research, U.S. Utilities: The EPA’s Mercury and Air Toxics St andards Are Tougher Than They Appear , March 2011.

13 NESCAUM, supra n.7.

14 NRG Energy, Q1 2011 Earnings Conference Call , May 5, 2011.

15 Duke Energy Indiana, Inc., Petition for issuance of a Clean Coal Technology Ce rtificate of Public Convenience and Necessity ("CPC N") pursuant to Ind. Code § 8­1­8.7 for the use of a Dry Sorbent In jection System at its Gallagher Generating Station Units 2 and 4 , No. 43873 (Indiana Utility Regulatory Commission, Sep 8, 2010).

16 GenOn, http://www.genon.com/company/company­enviro nmental­technology.aspx (accessed June 3, 2010)

17 Edison International, Q2 2010 Earnings Call Transcript , http://www.morningstar.com/earnings/16355020­edis on­international­eix­q2­2010.aspx (accessed June 4, 2011)

18 Midwest Generation LLC, Form 10­K , February 2011.

19 NESCAUM, supra n.7.Ensuring a Clean, Modern Electric Generating Fleet while Maintaining Electric System Reliability | SUMMER 2011 UPDATE

M. J. Bradley & Associates LLC 12 Analysis Group A.  Financial statements confirm that at least some of the nation’s largest coal­fired generating companies are well positioned to comply, reflecting the progress throughout the U.S. coal fleet in adding modern pollution control systems

A survey of recent corporate earnings statements sh ows that several of the companies that own signific ant quantities of coal­fired generating capacity are we ll positioned to comply with EPA’s proposed air qua lity

rules because of earlier investments in their fleet s.  The following quotes, from a sampling of electr ic company executives, highlight several important the mes: (1) companies have long anticipated these rule s; (2) early investments have positioned these compani es well for compliance; and (3) the impact on elect ricity rates can be managed.

• Benjamin G.S. Fowke, III, President and Chief Opera ting Officer of Xcel Energy, said: “Like many of our peers, we are in the process of evaluating what if any impact [EPA’s Utility Toxics Rule] may have on our operations.  Based on our preliminary review we do not anticipate that the rule will require extensive changes to our plans at [Northern States Power] and [Public Service Company of Colorado]...Our proactive steps to reduce emissions t hrough the MERP project in Minnesota and our plans for the Clean Air­Clean Jobs Act in Colorado put us in good position to comply with these rules. ” April 28, 2011, Xcel Energy Inc. 1st Quarter 2011 E arnings Call

• Jim Rogers, President and CEO of Duke Energy, said: “[T]he anticipation of more stringent environmental rules has long been part of our busin ess plan.  Over the past 10 years, we have spent $5 billion retrofitting existing units with updated em issions controls...Today, approximately 75% of our current coal generation capacity has scrubbers in o peration.  This will increase to approximately 90%, once our fleet modernization program and related re tirements are completed...We have really mitigated

a lot of the risk and the cost associated with this program by the early steps that we took.” May 3, 2011, Duke Energy 1st Quarter 2011 Earnings Call

• According to Gale Klappa, Chairman, President and C EO of Wisconsin Energy: “We really see very little impact on customer electric rates or our cap ital plan between now and 2015 as a result of all t he new EPA regulations that have been proposed...We migh t see 1% to 2% increase our best guess [sic]. So that gives you an example of how well we are pos itioned from the environmental standpoint in terms of complying with even the new proposed rule.” May 3, 2011, Wisconsin Energy Corporation 1st Quarter 2011 Earnings Call

• Reacting to EPA’s proposed Utility Toxics Rule, The odore Craver, chairman, president and CEO of

Edison International said: “We installed the necess ary equipment back in 2009 and are already achieving these [mercury] limits.  U.S. EPA’s rule contained other draft provisions covering acid gase s and non­mercury metals, which we can meet by instal ling the pollution control equipment we have been planning to use at Midwest Gen to meet our SO2 emis sions commitments to the Illinois EPA.” May 2, 2011, Edison International 1st Quarter 2011 Earning s Call

• William Spence, Chief Operating Officer, Executive Vice President and President of PPL Generation, said: “Our proactive approach to environmental comp liance positions the PPL fleet favorably for future EPA regulation.  Ninety­six percent of the competit ive coal generation is scrubbed, 88 percent has NOx controls already installed.” February 4, 2011, PPL 4th Quarter 2010 Earnings Cal l

• Mauricio Gutierrez, Executive Vice President and Ch ief Operating Officer of NRG reports that: “The proposed [Utility Toxics Rule] provides flexibility in that compliance can be achieved through facilit y 

### II. C OMPANY 

### R EACTIONS TO 

### EPA R ULESEnsuring a Clean, Modern Electric Generating Fleet while Maintaining Electric System Reliability | SUMMER 2011 UPDATE

M. J. Bradley & Associates LLC 13 Analysis Group averaging and company selected control technology. It also recognizes the inherent differences in mercury emissions from lignite coal... [t]he key takeaway is that we do not expect at this time any additional environmental CapEx beyond what we have previously announced.” May 5, 2011, NRG Energy 1st Quarter 2011 Earnings Call

• The Tennessee Valley Authority (“TVA”), which owns 17,000 MW of coal­fired generating capacity, announced plans in April 2011 to retire 18 older co al­fired generation units at three power plants ( 2 ,700 MW) as part of the utility’s vision of being one of the nation’s leading providers of low­cost and cle aner energy by 2020.  The utility will replace “older an d less­economical generation with cleaner sources.” Tom Kilgore, TVA’s President and CEO, said that a “ variety of electricity sources, rather than heavy reliance on any single source, reduces long­term ri sks and helps keep costs steady and predictable....In the longer term, these actions reinforce our vision to keep bills low, keep our service reliability hi gh and further improve air quality as we modernize the TVA power system.” TVA Press Release, April 14,

2011Ensuring a Clean, Modern Electric Generating Fleet while Maintaining Electric System Reliability | SUMMER 2011 UPDATE

M. J. Bradley & Associates LLC 14 Analysis Group A.  Results from PJM’s RPM forward capacity auction show that the industry is able to meet future electricity demand while maintaining electri c system reliability

Recent market information from one region of the co untry with a large concentration of coal­fired powe r plants provides up­to­date information and insights about how various players in the industry plan to respond to the EPA’s future air pollution regulatio ns.  Market participants not only include owners of power plants affected by the EPA air pollution regulation s, but also owners of other power plants and provid ers of demand­side resources, all of whom are critical to ensure regions have access to diverse, reliable, ef ficient, and environmentally compliant electric resources.

PJM provides reliability and wholesale power market functions for the nation’s largest  integrated pow er market, serving 54 million customers in 13 Mid­Atla ntic and Midwestern states including all or parts o f Delaware, Illinois, Indiana, Kentucky, Maryland, Mi chigan, New Jersey, North Carolina, Ohio, Pennsylvania, Tennessee, Virginia, West Virginia, a nd the District of Columbia.  In addition to operat ing a centrally dispatched, competitive wholesale electri c power market, PJM coordinates and directs the operation of the transmission grid and plans transm ission expansion improvements to maintain grid reliability in the region.  Much of the generating capacity in PJM’s footprint is at coal­fired power plants, some of which are old and relatively inefficient. At the end of 2010, coal units comprised 41 percent of capacity in PJM. 20

Keeping the Lights On at the PJM Control Room

Source: **PJM. PJM 2010 Annual Report.**

To secure adequate capacity to meet future projecte d power demand, PJM recently conducted its latest round of market­based bidding through its Reliabili ty Pricing Model (“RPM”) forward capacity auction. On May 13, 2011, PJM announced the results of that auc tion, which covers the period from May 31, 2014 through June 1, 2015 – a time when the Utility Toxi cs Rule and the Transport Rule will both be in effe ct. PJM’s forward capacity auction requires owners of p ower plants and other participating companies 21 to offer (i.e., commit) resources including both power plants and demand­side resources, three years in

20 Monitoring Analytics, State of the Market Report for PJM , March 10, 2011.

21 There are exceptions to this requirement for compa nies that provide their own generating resources to meet their own loads.  Power companies in PJM that do not participate in the capacity auction, li ke AEP and Duke

‐ Ohio, are required to certify that they have adequa te capacity to ensure reliable service. These companies have confirmed that they have suffi cient electric capacity to meet their needs through June 1, 2015 – more than five months after the EPA rules are expected to take effect. 

### III. PJM F ORWARD 

### C APACITY 

### A UCTIONEnsuring a Clean, Modern Electric Generating Fleet while Maintaining Electric System Reliability | SUMMER 2011 UPDATE

M. J. Bradley & Associates LLC 15 Analysis Group advance  so as to maintain electric system reliabil ity.  Resources that “clear” the auction receive ca pacity payments; those that do not clear receive no compen sation for their capacity.

The results of the May 13 th 2011 auction show that while some coal plants 22 were unable to clear the auction and may choose to retire, the region was still able to secure an ample supply of energy resources to m aintain reliability.  In fact, the market secured resources sufficient to maintain a 20 percent reserve margin for the region.

Out of a total of nearly 150,000 MW of capacity sel ected in the recent PJM auction, 23 nearly 4,200 MW of new capacity plans to enter the market by 2014/2015 , including the addition of new generation capacity resources, capacity upgrades to existing generation capacity resources, new demand resources, upgrades to existing demand resources, and new energy efficienc y resources.

The PJM Service Territory

“MAAC” is the Mid­Atlantic Area Council Region whic h is the eastern part of PJM.  Within MAAC are the Eastern (“EMAAC”) area which includes parts of New Jersey, Eastern Pe nnsylvania, Delaware and Eastern Maryland – in the areas served by PSE&G, JCP&L, PECO, AE, DPL & RECO); the Southwestern MAAC (parts of Maryland and the District of Columbia, s erved by PEPCO and BG&E); and the Western MAAC (parts of Pennsylva nia served by Penelec, MetEd, PPL).  There is also “Western PJM” – in parts of Illinois, Indiana, Ohio, Kentucky and othe r states (ComEd, AEP, Dayton, APS, Duquesne, ATSI, Duke).

Source: **PJM, http://pjm.com/documents/~/media/about-pjm/pj m-zones.ashx (accessed June 3, 2011)** 

The price of capacity, which accounted for less tha n 20 percent of PJM wholesale power prices in 2010 when prices were at historic highs, increased and d ecreased in different parts of the region. 24 As summarized in the chart below, in the Eastern part of PJM (the subregions called “MAAC” and “EMAAC”), prices fell more in line with past price levels.  T he “RTO” price—representing the price in the portio ns of the PJM region not constrained by transmission (whi ch effectively is the western portion of the PJM system)—increased to levels that were still below p rices in 2010/2011 although slightly above prices i n 2009/2010 and 2011/2012.

22 Note that PJM’s market monitor had provided guidan ce to participants in the auction that they should develop their bids assuming compliance with the EPA Utility Toxic Rule: “Question 1: If a participa nt determines that the costs to meet the proposed M ACT rules will be prohibitive, do they need to submit a request for deactivation so that they woul d not have to offer a unit into the 2014/2015 Base Residual Auction (BRA)?  Answer 1: The MMU expects participants to offer units based on their calculated costs of compliance and based on their o wn economic decisions.  If the units do not clear, participants have the option to retire the units.” See Monitoring Analytics, Clarification on ACR Data and Pending EPA Regulatio ns , April 28, 2011.

23 This amount is lower than PJM’s 2010 generating ca pacity of 167,362 MW (See PJM, Annual Report , 2010), or its projected capacity requirements for 2014/2015, because some distribution companies are permitted to satisfy their capacity requirements th rough their own generating resources, as noted previously.

24 Monitoring Analytics, State of the Market Report for PJM , March 10, 2011.Ensuring a Clean, Modern Electric Generating Fleet while Maintaining Electric System Reliability | SUMMER 2011 UPDATE

M. J. Bradley & Associates LLC 16 Analysis Group The generating units that failed to clear the aucti on—including fossil generating units that may event ually be slated for retirement—were largely offset by the se new generating, energy efficiency, and demand response resources.  In its auction results, PJM re ported a reduction in committed coal capacity in 2014/2015 equal to 6,900 MW, and suggested that the decrease is likely related to some coal capacity reflecting the costs of environmental retrofits in their offer prices. 25 These costs would make some coal

units uneconomic relative to lower cost resources. In contrast to the reduction in committed coal cap acity, however, demand response resources increased by 4,8 36 MW. 26 Commitments to conserve energy through energy efficiency increased by 142.7 MW. 27 The auction also procured 695 MW of wind power a nd 45.6 MW of solar power. 28

Figure 4 – PJM Base Residual Auction Resource Clear ing Prices

**Source: PJM,** 2014/2015 RPM Base Residual Auction Results **, PJM DOCS #645284 (May 2011).**

Notes: **RPM – Reliability Pricing Model, with the “Base Res idual Auction” being the initial auction each year**  **to select basic resources for a future period.**  **“RTO” – Regional Transmission Organization—effectiv ely these are the capacity prices in the western po**  **rtion of PJM.**
**“MAAC” – Mid-Atlantic Area Council “EMAAC” – Eastern Mid-Atlantic Area Council region**  **“SWMAAC” – Southwest Mid-Atlantic Area Council regi on** 

As indicated by the results of PJM’s most recent fo rward capacity auction, the region will have more t han enough capacity to meet federal reliability standar ds set by NERC when the Utility Toxics Rule and the Transport Rule will both be in effect.  Notably, mo re than 5 GW of new capacity came into the market w ith this auction, including new generation and new dema nd side resources such as energy efficiency and demand response.  This outcome illustrates the dive rsity of ways that market participants can provide reliable power supplies while meeting future enviro nmental requirements.

B.  The results of the PJM forward capacity auction suggest that some projections of future coal plant retirements may be overstated

Numerous analyst reports have been issued since the beginning of 2010, predicting varying levels of co al plant retirements in the U.S.  Some of the factors contributing to these retirement projections includ e lower

25 PJM, 2014/2015 RPM Base Residual Auction Results: Addend um , PJM DOCS #648604 (May 2011).

26 Id.

27 PJM, 2014/2015 RPM Base Residual Auction Planning Period Parameters , PJM DOCS #631095 (May 2011)

28 PJM, Demand Resources and Energy Efficiency Continue to Grow in PJM’s RPM Auction , May 13, 2011.Ensuring a Clean, Modern Electric Generating Fleet while Maintaining Electric System Reliability | SUMMER 2011 UPDATE

M. J. Bradley & Associates LLC 17 Analysis Group electricity demand, lower natural gas prices, the a dvanced age of many coal­fired generating units, an d the

increased costs associated with EPA’s environmental rules.  Many of these reports included impacts fro m EPA’s air regulations as well as other rules (e.g., 316(b) cooling water standards, coal ash rules, an d some of the studies have modeled a price on greenhouse gas emissions).  Most of these studies were developed p rior to the issuance of the Utility Toxics Rule in March 2011.  Examples of some of these analyst reports a re summarized below, including projected coal capacity retirements.

The results of the recent PJM forward capacity auct ion, which reflect actual market investment decisio ns rather than modeled predictions, suggest that the l evel of coal plant retirements will be more modest than some have predicted and that the 13­state PJM regio n will have ample electricity supply after EPA’s ai r regulations go into effect in the middle of the dec ade. As EPA’s proposed air pollution regulations ar e more flexible than had been anticipated by some of those studies’ “worst­case” scenarios and given the indu stry can supply needed capacity through a variety of res ources, the recent PJM auction results suggest that coal plant retirements will likely fall at the lower ran ge of prior estimates. 29

Study by Release

Date Nationwide Projected

Capacity Retirement
(denotes coal capacity only) Incremental

Retirements (excludes 13 GW of already announced retirements/idlings) Report Title

CERA March

2011 35 GW

(by 2020) 22 GW Staying Power Can US Coal Plants Dodge Retirement for Another Decade? (Private Report)

Bernstein

Research March

2011 54 GW

(by 2014/15) 41 GW U.S. Utilities: The EPA’s Mercury and Air Toxics Standards Are Tougher Than They Appear

FBR Capital December

2010 45 GW

(by 2018) 32 GW Coal Retirements in Perspective: Quantifying the Upcoming EPA Rules

The Brattle Group December

2010 40­55 GW

(by 2020) 34 GW Potential Coal Plant Retirements Under Emerging Environmental Regulations

NERC October

2010 15­35 GW

(by 2018) 12 GW 2010 Special Reliability Scenario Assessment: Resource Adequacy Impacts of Potential U.S. Environmental Regulations

Credit

Suisse September

2010 60 GW

(by 2017) 47 GW Growth from Subtraction: Impact of

EPA Rules on Power Markets

PIRA Energy Group April

2010 30­40 GW

(by 2015) 22 GW EPA’s Upcoming MACT: Strict NonHg Regs Can Have Far­Reaching Market Impacts

29 See also S. Tierney and C. Cicchetti, The Results in Context: A Peer Review of EEI’s “Pot ential Impacts of Environmental Regulation on the U .S. Generation Fleet,” May 2011; and S. Tierney, Electric Reliability under New EPA Power Plant Regu lations: A Field Guide, January 18, 2011, http://www.wri.org/stories/2011/01/electric­reliabi lity­under­new­epa­power­plant­regulations­field­gu ideEnsuring a Clean, Modern Electric Generating Fleet while Maintaining Electric System Reliability | SUMMER 2011 UPDATE

M. J. Bradley & Associates LLC 18 Analysis Group A.  EPA has the statutory authority under the Clean Air Act to grant, on a case­by­case basis, extensions of time to complete the installation of pollution control systems

In general, under the Clean Air Act, Congress requi res existing, affected sources to comply with stand ards for hazardous air pollutants “as expeditiously as pract icable, but in no event later than 3 years after th e effective date of such standard.”  As a result, affected coal ­fired power plants will need to comply with the em issions limits of the Utility Toxics Rule by the beginning of 2015.  However, there are exceptions under the l aw, which

allow additional time for the installation of contr ols, and, in fact, EPA emphasizes in its proposed U tility Toxics Rule that the Agency and state regulatory authoriti es have the discretion to grant, on a case­by­case basis, an additional 12 months for the installation of pollut ion control systems where appropriate.  Permitting authorities have used this provision in the past under previous air toxics rules.

This provision provides companies with the flexibil ity to schedule the installation of controls across multiple outage periods—maintaining electric system reliabil ity while facilitating the expeditious installation of pollution control systems.  Companies will typically construc t pollution control systems while a power plant con tinues to operate.  The equipment is then connected or “tied­ in” to the plant during a scheduled outage period, coordinated with other generating facilities to ens ure reliability.  This will typically occur during a month or month(s) when the demand for electricity is relativ ely low—avoiding the hottest summer months and the coldest winter months.  A 12­month extension would provide plant operators with an additional two shoulder per iods to schedule outages and stagger the installation of co ntrols.

If four years is still not enough time to install t he necessary controls, EPA and the Department of En ergy have the authority to enter into administrative orders o f consent or consent decrees with power plants, all owing them to run under specific and limited circumstances to maintain reliability.  This approach ensures that r eliability

standards are maintained without an across­the­boar d delay in the implementation of the rules. 

### IV.  EPA A UTHORITY 

### T O 

### G RANT 

### A DDITIONAL 

### T IME FOR 

### T HE 

### I NSTALLATION OF 

### C ONTROLSEnsuring a Clean, Modern Electric Generating Fleet while Maintaining Electric System Reliability | SUMMER 2011 UPDATE

M. J. Bradley & Associates LLC 19 Analysis Group These new findings support the conclusion that we r eached in our August 2010 study on EPA’s air regula tions and their implications for electric system reliabil ity.  The flexible nature of EPA’s regulations, the readiness reported by leaders of many of the companies owning affected coal plants, the recent results of the fo rward capacity auction in PJM, and the various authoritie s of EPA and other federal agencies all indicate we can modernize and clean the nation’s electric fleet to enhance public health while maintaining electric sy stem reliability. 

### V.  C ONCLUSIONEnsuring a Clean, Modern Electric Generating Fleet while Maintaining Electric System Reliability | SUMMER 2011 UPDATE

M. J. Bradley & Associates LLC 20 Analysis Group APPENDIX A

State Mercury Regulations

State Year Enacted Policy/Rule

New Hampshire 2002 Requires 75% reduction in annual mercury emissions from coal plants compared to 1996/97 emissions.

Connecticut 2003 Requires coal­fired power plants to achieve either an emissions standard of 0.6 lb/tBtu or a 90% effic iency in technology installed to control mercury emission s.

New Jersey 2004 Requires a 90% reduction of mercury emissions from coal­fired power plants by the end of 2007. Plants have the option of meeting the standards in 2012 if they also make major reductions in their emissions of sulfur dioxide, nitrogen oxides, and fine particula tes.

Delaware 2006 Requires power plants to capture at least 80% of me rcury beginning in 2009 and 90% beginning in 2013.

Maryland 2006 Requires power plants to capture at least 80% of me rcury beginning in 2010 and 90% beginning in 2013.

Illinois 2006 Requires power plants to reduce mercury emission by 90% starting in July of 2009.

North Carolina 2006 Requires power plants submit by January 1, 2013 det ailed plans and timetables for achieving maximum technically and economically possible mercury reduc tions at each unit.  Units that are not controlled by

2017 must be shut down.

Montana 2006 Requires mercury emitting EGUs to achieve an emissi on rate lower than 0.9 lb/TBtu by January 1, 2010. EGUs unable to meet this limit after installing an approved control strategy may apply for an alternat ive limit by July 1, 2011.

Minnesota 2006 Requires MN’s largest coal­fired power plants to cu t mercury emissions by 90% by 2015.

Massachusetts 2007 Requires power plants to capture at least 85% of me rcury (or achieve a rate of 0.0075 lb/GWh) by 2008 and 95% of mercury (or achieve a rate of 0.0025 lb/ GWh) by 2012.

New York 2007 Phase I (2010): Power plants must reduce mercury em issions by 50%.  Phase II (2015):  Implementation of unit­based limits for each facility to reduce me rcury emissions by 90% using Maximum Available Control Technologies

Colorado 2007 Requires new or reconstructed units to achieve a mi nimum mercury capture rate of 90% and implement

BACT.

Georgia 2007 Multi­pollutant Control for EGUs (steam) requires four specific power plants to carry out fe asibility studies for mercury controls by 2018. Mercury emissions from new EGUs require the use of BACT to control mercury emissio ns.

Wisconsin 2008 Requires large (>150 MW) coal­fired power plants to either – a) achieve a 90 percent reduction in merc ury emissions from coal by the year 2015; or b) reduce multiple pollutants, including nitrogen oxides (NOx ) and sulfur dioxide (SO 2 ), and achieve 90 percent reduction in mercury emis sions six years later Requires small (> 25 MW and < 150 MW) coal­fired po wer plants reduce their mercury emissions to

BACT level.

South Carolina 2008 Requires power plants to install mercury emission m onitoring equipment by June 2009.

Michigan 2009 Requires EGUs to reduce mercury emissions by 90%, o r achieve 75% mercury emission reductions along with nitrogen oxides (NOx) and sulfur dioxide (SO 2 ) reductions.

Oregon 2010 Caps mercury emissions from new EGUs and requires i nstallation of mercury controls at existing ones. Total statewide mercury emissions limited to 60 lb/ year after 2018.  New coal plants cannot emit more than 25 lb/year.

Source: **Environmental Defense Fund, Mercury Alert: Cleanin g up Coal Plants for Healthier Lives, March 2011.**