Additional Tribal Consultation 

on Mercury and Air Toxics 

Standard (MATS) as Related to 

Navajo Generating Station

October 6, 2011
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• Key Messages

• What is MATS

• MATS and the Integrated Planning Model (IPM)

– What is IPM

– How was IPM used for MATS

• Next Steps

Topics to Be Covered
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• MATS was proposed to reduce emissions of hazardous air 

pollutants (HAP), including mercury, acid gas HAP, and 

metal HAP from coal- and oil-fired power plants

• EPA used IPM to analyze the power sector’s costminimizing response to meet electricity demand with 

MATS in place

• IPM is a well-established analytical tool

– A great deal of effort is expended to ensure high quality input data 

and assumptions

• EPA’s IPM analysis of MATS does not dictate what a 

given facility must do to comply with MATS

– Each facility may determine its own compliance strategy to meet 

the emission rate limits in MATS

Key Messages
What is MATS

• Why was it proposed

– To reduce emissions of HAP, including mercury, acid gases, and other 

metallic HAP

– By consent decree, final rule must be signed by November 16, 2011

• What was proposed and who is affected

– Affects coal- and oil-fired electricity generating units greater than 25 MW 

in size

– Coal-fired units must meet emission limits for mercury, hydrochloric acid 

(acid gas HAP), and particulate matter (as a surrogate for the HAP 

metals)

• Alternate limits for HAP metals (e.g., arsenic, lead)

– Does not set emission limits for NOx or SO2

• SO2is an alternate for HCl from coal-fired units

– Compliance within 3 years of promulgation

• Option for 4th year at the discretion of the permitting authority

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What is MATS (cont’d)

• EPA expects the new emission limits can/will be 

met with several well-established technologies

– Electrostatic Precipitator (ESP) – uses charged electrical 

plates to pull particulate matter out of exhaust stream

– Fabric Filters/Baghouses – uses a series of fabric bags to 

filter out particulate matter of varying sizes

– Activated Carbon Injection (ACI) – injects activated carbon 

molecules into exhaust airstream. The activated carbon 

adheres to mercury molecules, increasing their diameter to a 

size that allows them to be captured by fabric filters

– Wet- and dry-scrubbers – use lime or limestone to remove 

acid gases, including SO2 and HCl

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What is MATS (cont’d)

• When was it proposed

– Proposed on May 3, 2011

– Public comment period closed on August 4, 2011

• Next steps for final agency action

– Review, consider, and respond to comments

– Signature of final rule by November 16, 2011

– Publish in the Federal Register by December 2011 – January 

2012

 Congressional review under the Congressional Review Act expected

 Litigation expected

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What is IPM

• The Integrated Planning Model (IPM) is used to analyze the 

electric power sector

• IPM solves for the least-cost pathway to meet electricity 

demand subject to environmental, transmission, fuel, reserve 

margin, and other system operating constraints

• EPA’s application of IPM is designed to inform system-level 

policymaking

– EPA’s applications are not set up to substitute for any specific utility’s 

individual unit-level operational decision-making

– Utilities will make their own determinations of the most economic way

to satisfy electricity demand while achieving environmental compliance

• Power purchase agreements, contractual arrangements, and other local 

variables (known privately to the unit operators) are not directly 

represented in EPA’s application of IPM

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IPM and the Mercury and 

Air Toxics Standards

• EPA used IPM to analyze the impacts of the MATS emission rate 

requirements on the power sector using IPM

• The MATS emission rate requirements were developed separately 

from an Information Collection Request (ICR) dataset based upon 

the best performing units (maximum achievable control technology 

or MACT)

• Ran model with final MATS emission rate limits to project the 

following outputs of interest

– Retrofit technology deployment

– Emission levels (subsequently used to conduct air quality modeling of 

the rule’s impacts)

– Dispatch patterns of existing and new units to meet demand while 

maintaining regional grid reliability 

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NGS under MATS in IPM

• Input assumptions about NGS

– Total plant capacity: 2.3 GW (net summer)

– Unit heat rate: 10,460 – 10,777 Btu/KWh

– MATS-relevant controls: wet scrubber, hot-side ESP

• Projected base case performance

– 1.5 lbs/Tbtu Hg

– 0.002 lbs/MMBtu HCI

• Proposed MATS compliance requirements

– 1.2 lbs/TBtu Hg; 0.002 lb/MMBtu HCI

– Assumed that FF required to meet PM standard ($147/kW, or $110 million per unit in $2009)

– Assumed that existing FGD would be upgraded ($100/kW, or $75 million per unit in $2009)

• MATS Policy Case Projection

– Only unit 3 operates, increasing generation to cover reduction from units 1 and 2 (total plant 

generation roughly equivalent in base and policy)

– Mercury reductions achieved with fabric filter; HCI reductions achieved with FGD upgrade

– 0.8 lb/TBtu Hg; 0.001 lb/MMBtu HCI

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Further Information on EPA’s IPM

• Regulatory and legislative analyses using 

IPM

• Explanatory presentations

• Comprehensive modeling documentation

• http://www.epa.gov/airmarkt/progsregs/epaipm/index.html

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Next Steps

• Schedule for MATS

• Comments under consideration, possible 

changes made to assumptions, methodologies, 

etc.

• Notification to Tribes (or any other follow up 

consultation) after final MATS rule issued

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Questions?
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Appendices
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How Has IPM Been Used

EPA has used IPM to

• Support rules: CSAPR, MATS, CAIR, CAMR, CAVR, Title IV, NOx SIP Call, 

Revised NAAQS, Cooling Water Standards 

• Evaluate effects of 1990 Clean Air Act amendments

• Analyze environmental impacts of restructuring

• Investigate CO2reduction strategies and programs

• Analyze multi-pollutant control scenarios

Other users include

• Ozone Transport Assessment Group (OTAG)

• Clean Air Task Force and other environmental groups

• National Coal Association

• Edison Electric Institute

• Electric Power Research Institute 

• Southern CAL Edison, PacifiCorp, AES, Florida Power, CINergy, and many

other private power companies

• Tennessee Valley Authority
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Questions IPM Can Inform (I)

• On electric system operation

– What types of new generation will be built

 How much and when

– How does the generation (or capacity) mix change over time

– What changes in fuel (coal, natural gas, oil) production and use occur

• On emissions

– How will emissions change over time

– Where will emissions occur

• On emission control strategies

– What emission controls will be installed

 At what types of units

– Does fuel switching occur 

 To what extent, and in what regions
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Questions IPM Can Answer (II)

• On costs and related impacts

– What is the annual incremental cost of meeting electricity demand with 

potential new policy requirements in place

– What price signals (on electricity, fuels, and allowances) would the 

market experience

– What is the comparative cost of different policy structures such as:

 System-wide caps with trading and banking

 Plant level emission limits

 Region-specific emission caps

• Sensitivity analysis

– How do policy impacts change if improved energy efficiency helps 

lower the growth of electricity demand

– How does the development of certain fuel supplies affect grid dispatch 

and environmental compliance decisions

– How would a given technological development affect future costs
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Input Requirements for IPM

• Detailed representation of

– All existing generating units and their configuration

– All available technology options for future deployment

 Electric generating technologies

 Emission control technologies

– All factors affecting operation, performance, and 

expansion or contraction of the power sector

– Economic behavior of power sector

– Emission constraints on power sector
Overview of Section 112

• Section 112 of CAA mandates that EPA develop standards for 

hazardous air pollutants (HAP) for both major and area sources listed 

under section 112(c)

– The section 112 definition of EGU does not distinguish between area and major 

sources

– Major sources of HAP are those that have the potential to emit 10 tons per year 

(tpy) or more of any one HAP or 25 tpy or more of any combination of HAP

• Section 112(d)(2) states that major source standards must be based on 

the maximum achievable control technology (MACT)

• Section 112(d)(3) sets minimum stringency criteria (MACT Floor) –

costs may not be considered

– For existing sources

 “The average emission limitation achieved by the best performing 12 percent of existing 

sources...”

– For new sources, the MACT floor is

 “The emission control achieved in practice by the best controlled similar source”

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Overview of Section 112 (cont’d)

• EPA may regulate “beyond the floor” where justified –

costs and other issues must be considered

– MACT may differ for new and existing sources

– Section 112(d)(1) provides EPA with authority to distinguish 

among classes, types, and sizes of sources

– Section 112(d)(4) provides EPA with discretionary authority to 

establish health-based emission standards for HAP for which a 

health threshold has been established

– Section 112(h) allows the use of work practice standards instead 

of emission standards if enforcement of an emission standard is 

“not feasible,” as that term is defined in that section

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Some Legal Constraints on 

Section 112 Rulemakings

• Emission standards must be established for EGUs that are located 

at major sources and at area sources

• Voluntary or incentive-based approaches are not allowed

• Emission standards must address all HAP emitted from EGUs

• Standards must set technology-based limits

– Viability of health-based emission standards and work practice standards 

will be explored

• Method for determining the minimum level of emissions control (i.e., 

MACT floor) must be followed

• Only units in the MACT floor may be used in determining variability 

unless a demonstrated relationship between the variability of 

sources outside the floor and the variability of sources within the 

floor can be shown

• Regulatory options more stringent than the MACT floor must be 

considered

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