CLEAN POWER PLANReducing Carbon Pollution FromExisting Power PlantsSuzanne Murray – Regional Counsel,EPA Region 6November 5, 2014Disclaimer•This presentation is a discussion of the proposed Clean Power Plan.Any error in this presentation does not trump the language of theproposal.•This presentation is not a forum to take comment onthe Clean PowerPlan; to comment, you must follow the comment procedures listed inthe proposal.•Clean Power Plan proposal citation: 79 FR 34830 (June 18, 2014) orhttp://www.epa.gov/cleanpowerplan. Note: the deadline to submitcomments has been extended to December 1, 2014.•Notice of Data Availability (NODA) and SupplementalProposal: twoseparate documents announced on October 28, 2014, andnot yetpublished in the Federal Register. Access them at the link above.Deadline to submit comments: December 1, 2014 and December 19,2014, respectively.2This Proposal Deals With the LargestSource of GHG Emissions in the U.S.3This proposal will:•Reduce carbon pollution from existing power plants,for which there arecurrently no national limits.•Maintain an affordable, reliable energy system.•By 2030, reduce nationwide carbon dioxide (CO2) emissions, from the powersector by approximately 30% from 2005 levels.•Cut hundreds of thousands of tons of harmful particle pollution, sulfur dioxideand nitrogen oxides as a co-benefit.•Build on actions states, cities and businesses across the country are alreadytaking to address the risks of climate change.•Spur investment in cleaner and more efficient technologies, creating jobs anddriving innovation.•Provide a flexible timeline—up to 15 years from guideline issuance—for allemission reduction measures to be fully implementedin 2030.•Provide an array of tools states can use to formulate approvable plans.4SummaryBackground: Clean Air Act Section 111(d)Best System of Emission Reduction (BSER)5•Previous EPA rules under this section of the Clean Air Act haveconsidered “add-on” control technologies – like scrubbers -- that aretechnically feasible to deploy at virtually any facility.•In contrast, there are a wide variety of ways to reduce carbon pollutionthat are commercially available, technically feasible, and cost effective.•The opportunities vary from state to state, depending on how electricityis generated, energy infrastructure, and other factors.•In this proposal, EPA took an approach that viewed the Clean Air Actfactors in determining Best System of Emission Reduction in light of theinterconnected nature of power generation.•BSER factors•Costs•Size of reductions•Technology•Feasibility•EPA conducted a robust preproposal stakeholder engagementprocess.•Participated in meetings withover 300 utility, consumer, laborand environmental groups sinceJune 2013.•Held 11 public listening sessionsaround the country.•Reached out to all 50 states.6Early Outreach Informed This ProposalEPA Establishes a Goal for Every State•EPA analyzed the practical and affordable strategies that states and utilities arealready using to lower carbon pollution from the power sector.•Proposed goals are based on a consistent national formula, calculated with stateand regional specific information.•The result of the equation is the state goal.•Each state goal is a rate – a statewide number for the future carbon intensity ofcovered existing fossil-fuel-fired power plants ina state.•Encompasses the dynamic variables that ultimately determine how much carbon pollution isemitted by fossil fuel power plants.•Accommodates the fact that CO2emissions from fossil fuel-fired power plants are influencedby how efficiently they operate and by how much they operate.•The state goal rate is calculated to account for the mix of power sources in eachstate and the application of the “building blocks”that make up the best system ofemission reduction.•States will need to meet an interim goal and a final goal.7States Have FlexibilityBasis for state goal–Potential emissionspathway reflectingEPA’s analysis2020 2021 20222023 2024 20252026 2027 2028 2029A state can choose any trajectoryof emission improvement as longas the interim performance goal ismet on average over 10 years, andthe final goal is met by 20308

Carbon emissions from affected power plants in an example stateAs an example, states could do less in the early years, and more in the lateryears, as long as on average it meets the goalTiming of Power Plant Emission ReductionsBuilding Block Strategy EPA Used toCalculate the State GoalMaximum Flexibility:Examples of StateCompliance Measures1. Make fossil fuel-firedpower plants moreefficientEfficiency Improvements Efficiency improvementsCo-firing or switching to naturalgasCoal retirementsRetrofit CCS (e.g., WA Parish inTexas)2. Use lower-emitting powersources moreDispatch changes toexisting natural gascombined cycle (CC)Dispatch changes to existingnatural gas CC3. Build more zero/lowemitting energy sourcesRenewable EnergyCertain NuclearNew NGCCRenewablesNuclear (new and up-rates)New coal with CCS4. Use electricity moreefficientlyDemand-side energyefficiency programsDemand-side energy efficiencyprogramsTransmission efficiencyimprovementsEnergy storage9When States Plan, They Can:•Look broadly across the power sector for strategiesthat get reductions.•Choose to rely to varying degrees on measures thatEPA used tocalculate the goal, or on other measures that werenot part of the stategoal-setting analysis.•Invest in existing energy efficiency programs or create new ones.•Consider market trends toward improved energy efficiency and agreater reliance on lower carbon energy.•Tap into investments already being made to upgradeaginginfrastructure.•Expand renewable energy capacity.•Integrate their plans into existing power sector planning processes.•Design plans that use innovative, cost-effective regulatory strategies.•Develop a state-only plan or collaborate with eachother to developplans on a multi-state basis.•Decide how to treat plants nearing the end of theiruseful life and howto help plants avoid “stranded investments.”10Flexibilities Available To States•Timing:•Up to 15-year window in whichto plan for and achievereductions in carbon pollution.•Up to two or three years tosubmit final plans.•Form of goal: States can use eithera rate-based or mass-based goal.•Single or multi-state plans: Statescan collaborate and develop planson a multi-state basis.•Selection of measures:•States will choose how to meetthe goal through whatevercollection of measures reflectsits particular circumstances andpolicy objectives.•State measures may impact and,in fact may be explicitlydesigned to reduce, CO2emissions from utilities on aregional basis.•EPA would support building offexisting reduction programs.11Focus on Renewable Energy: Building Block 3:(Build more zero/low-emitting energy sources)•Renewable energy is a cost-effective approach for reducing CO2emissions from fossil fuel-fired EGUs through the substitution ofelectricity generated from renewable resources.•Portfolio of available RE sources encompasses a widevariety oftechnologies from utility-scale RE plants to smaller-scale distributedgeneration sited at residential, commercial, or industrial facilities.•RE technologies are fueled by the sun, wind, water,organic matter,and other resources regularly replenished by physical and biologicalcycles.•To integrate the rapidly increasing and evolving portfolio of RE intothe Best System of Emission Reduction (BSER), EPA has developed aproposed approach that builds upon current state policy encouragingincreased production of RE taking into account renewable potentialin particular regions of the country.12Focus on Renewable Energy: Building Block 3:(Build more zero/low-emitting energy sources)•A note on timing: RE generation counts towards a state goalregardless of when the RE project was constructed orcommencedoperations.•The exception is for hydro – the proposal excludes existing hydro (inplace before June 2014), and EPA is taking comment on that status.•For additional in-depth information, see the (224 pg.) TechnicalSupport Document (TSD) “GHG Abatement Measures” athttp://www2.epa.gov/carbon-pollution-standards/clean-power-planproposed-rule-ghg-abatement-measures(notably Chapter 4:“Chapter 4: Cleaner Generation Sources”)13Focus on Renewable Energy: Building Block 4(Use electricity more efficiently)•There are a variety of state energy efficiency (EE) policies.•In a given year, EE policies lead to new investments.•Impacts of EE policies ramp up over time as impacts ofinvestmentsaccumulate.•In setting the state goal, each state ramps up annual incrementalenergy savings from base levels to that of leadingstates.14States Choose How to Meet the Goals•Demand-side energy efficiencyprograms.*•Generating electricity fromlow/zero-emitting facilities.*•Expanding use of existing NGCCunits.*•Transmission efficiencyimprovements.•Energy storage technology.•Working with utilities to considerretiring units that are high emitting.•Energy conservation programs.•Retrofitting units with partial CCS.•Use of certain biomass.•Efficiency improvements at higheremitting plants.*•Market-based trading programs.•Building new renewables.•Dispatch changes.•Co-firing or switching to natural gas.•Building new natural gas combinedcycle units.*Measures EPA used in calculating the stategoals151602004006008001,0001,2001,4001,6001,8002,000Baseline (lb/MWh)2030 Goal (lb/MWh)

lb/MWh111(d) - Comparison of Region 6 State Baselines and2030 TargetsArkansasNew MexicoLouisianaOklahomaTexas47%42%43%42%44%After Proposal, Coal & Natural Gas RemainLeading Sources of Electricity Generation17Each more than 30% of projected generation in 2030Coal31%Natural Gas32%Other Fuel37%Next Steps•The proposed rule, as well as information about howto comment andsupporting technical information, are available online at:http://www.epa.gov/cleanpowerplan•There will be a 165-day public comment period on theproposal. Submitcomments by December 1, 2014.•Comments on the proposal should be identified by Docket ID No.EPA-HQ-OAR-2013-0602.18Recent Developments, Part 1: Supplemental ProposalAnnounced on October 28, 2014•Not yet published in the Federal Register.•The 115 page .pdf version can be accessed here:http://www.epa.gov/cleanpowerplan•Docket number is the same as the other documents: EPA-HQ-OAR2013-0602.•Deadline for comments: December 19, 2014.•A public hearing will be held in Phoenix.•Supplemental proposal will deal exclusively with theissue of affectedEGUs on tribal lands and in U.S. territories. It will propose baselinesand targets for these areas.19Recent Developments, Part 2: Notice of DataAvailability (NODA) Announced on October 28, 2014•Not yet published in the Federal Register.•The 60 page .pdf version can be accessed here:http://www.epa.gov/cleanpowerplan•Docket number is the same as the other documents: EPA-HQ-OAR-2013-0602.•Deadline for comments: December 1, 2014.•NODA will present information that EPA has receivedin comments that goesbeyond the proposed rule and issues for which comments were requested. Theintention is to make known comments and suggestionsreceived from states andother stakeholders so that everyone can have a chance to review them andsubmit comments on these ideas. The five main areas addressed in the NODAare:•1. Early reduction credits for compliance with the interim targets•2. How new coal-fired and NGCC turbines are handledin BSER•3. A regionalized approach for handling RE generation and accounting for RE that is generated inone state and used in another•4. A slight modification to the general BSER equation used to calculate the baseline and targets•5. CO2 emissions and power generation data for 2010and 2011 so that stakeholders interestedin a multi-year baseline can evaluate how that might affect the baselines for their states.2021By June 30, 2016State submits initial multistate plan and request for 2-year extensionEPA reviews initial planand determines ifextension is warrantedby June 30, 2017State submits progressreport of planby June 30, 2018States submits multistate planState submits Negative DeclarationState submits complete implementation Plan by June30, 2016State submits initial Plan by June 30, 2016 and request 1-year extensionState submits initial multi-state Plan by June 30,2016 and request 2-year extensionEmissionGuidelinePromulgationJune 1, 2015by June 30, 2016State submits negativedeclarationEPA publishes FR noticeby June 30, 2016State submits planby June 30, 2016State submits initial planand request for 1-yearextensionEPA reviews initial plan anddetermines if extension iswarrantedby June 30, 2017State submits complete plan20152019Proposed Implementation TimelineComplianceperiod begins20202020EPA reviews plan andpublishes final decisionwithin 12 months onapproval/disapprovalEPA reviews plan andpublishes final decisionwithin 12 months onapproval/disapprovalEPA reviews plan andpublishes final decisionwithin 12 months onapproval/disapproval201620172018Questions?Kristen Bremer111(d) EPA HQ, Office of Air and Radiation Contactfor Region 6Bremer.Kristen@epa.gov(919) 541-942422Rob Lawrence111(d) EPA Region 6 OutreachCoordinatorLawrence.Rob@epa.gov(214) 665-6580Terry Johnson111(d) R6 Liaison for Texas,Arkansas & LouisianaJohnson.Terry@epa.gov(214) 665-2154Clovis Steib111(d) R6 Liaison for Oklahoma &New MexicoSteib.Clovis@epa.gov(214) 665-7566Josh Olszewski111(d) Regional CounselOlszewski.Joshua@epa.gov(214) 665-2178Carrie Thomas111(d) Regional CounselThomas.Carrie@epa.gov(214) 665-7121Austin Vela111(d) Office of External AffairsVela.Austin@epa.gov(214) 665-9792

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