# From: Hackel, Angela

Sent: Friday, June 5, 2015 10:24 AM

To: Nathan_J._Frey@omb.eop.gov

Cc: Culligan, Kevin; Vasu, Amy

Subject: Slides for Today's Inter-agency Briefing on the Clean Power Plan Final Rule

Hi Nathan,

I hope this email finds you doing well! Kevin, asked me to send you the attached. He will be

walking through these at today’s interagency briefing.

Please let me know if you have any questions.

Thanks and have a great day!

Angela

<< CPP_Interagency briefing_June 5 2015.pptx >>Clean Power Plan:Overview of Draft Final RuleKevin CulliganAssociate Division Director, SPPDU.S. EPAJune 5, 2015Deliberative – Do Not Cite or QuoteOverview►The Best System of Emission Reduction (BSER)►CO2Emission Performance Rates and State Goals►State Plans►Electric System Reliability Assurance2Deliberative – Do Not Cite or QuoteThe Best System of Emission Reduction (BSER)►BSER is comprised of the first three building blocks (BBs); BB4 is nolonger included►Core concept of each BB has been retained, but with refinements toreflect new data and to address stakeholder comments►BB1 – in range of 2.1- 4.3 percent by region (6 percent nationwide atproposal)►BB2 – 75 percent net summer capacity (70 nameplate capacity factor atproposal)►BB3 – greater use of RE (based on techno-economic approach withupdated NREL data), inclusion of new NGCC, and removal of nuclear►Achievability of all BBs is facilitated by plans’ ability to authorizetradable credits or allowances►BBs are quantified consistentlyin terms of ability to produceincremental emission reductions►BBs are quantified at regional (interconnection) level to produceregional emission performance rates by technology category; emissionguidelines use the least stringent regional rates of any region for allregions3Deliberative – Do Not Cite or QuoteCO2Emission Performance Rates and State Goals►CO2Emission Performance Rates►We are setting emission performance rates for the two subcategories ofaffected EGUs•Fossil fuel-fired electric utility steam generating units: 1290 lbs per MWh•Stationary combustion turbines: 780 lbs per MWh►These are uniform and equitable for the sources across the sourcecategory, regardless of location►State Goals►We are providing mass-based and rate-based state goals►Goals are translated from thesubcategory-specific emissionperformance rates►Interim Rates and Goals►EPA is providing interim CO2emission performance rates and statemass- and rate-based goals for:•The 8-year interim period (2022-2029) and,•For each of three steps,2022-2024, 2025-2027, and 2028-20294Deliberative – Do Not Cite or QuoteState Plans►Plan Options►Emission standards approach►“State measures” approach, based on proposal’s “portfolio” approach•Would include state-enforceable measures that may apply to affectedEGUs and other entities, with some or no federally enforceable emissionstandards for affected EGUs, and a backstop of federally enforceablestandards on affected EGUs►State Plan Submittal Timing►13 months for initial plan submittal (August 31, 2016)►3 years for final plan submittal (August 31, 2018)►Options Beyond BSER Measures►States may choose from numerous options, including:•Demand-side EE, including through emissions trading•Transmission upgrades•Nuclear and hydro uprates5Deliberative – Do Not Cite or QuoteState Plans (cont.)►State Plan Submittal►Emission guidelines specify required components of a state plan►Submittal must include a demonstration that affected EGUs willmeet:•Interim step CO2emission performance rates or state CO2emissioninterim step goals on average over the 2022-2024, 2025-2027, and2028-2029 periods•Final CO2emission performance rates or state CO2emission goal by nolater than 2030►Timing for Demonstration►State is required to compare emission levels achieved by its affectedEGUs with emission levels projected in the state plan and reportresults to the EPA•Beginning January 1, 2025, and then January 1, 2027, followed byJanuary 1, 2029, and then every two calendar years•Reporting is required by July 1 of those calendar years6Deliberative – Do Not Cite or QuoteElectric System Reliability Assurance►Timing►Start date of 2022 and approach for interim goals gives more time for planning,consultation and decision making in the formulation of state plans and in EGUs’choice of compliance strategies►Requirements►Each state must provide documentation,in its plan submittal, that it hasconsidered reliability issues in developing its plan►Reliability Safety Valve►A one-time short-term modification toenforceable requirements placed on anEGU or EGUs under an approvedplan, initiated by the state•When conflict between rigid state requirements and maintenance of reliability due tounanticipated emergency triggers need for immediate short-term relief•State must notify EPA with writtenconcurrence from planning authority•States must meet goals►If problem not resolved at end of period, state must revise its plan►States plans that allow for flexibleapproaches such as trading and averagingwould not need to use this mechanism►Memorandum►EPA, DOE and FERC will document joint understanding of how they willcoordinate efforts to help ensure continued reliable electricity generation andtransmission during implementation of the final rule7