UNITED STATES ENVIRONMENTAL PROTECTION AGENCY WASHI N G T O N , D
. C
. 20460

OFFICE OF AIR AND RADIATI O N 

### MEMORANDUM Subject: From : To: Summary of Stakeholder Meetings Carissa Cyran Dockets EPA-HQ-OAR-20 13-0602, E PA-HQ-OAR-20 13-0603, and EPA-HQOAR-20 13-0495 This memorandum summarizes meetings with stakeholders during the week of April 20, 2015 . On April 20 , Adm ini strator Gina McCarthy spoke with Lynn Good of Duke Energy. On April 20 , Associate Ass i stant Administrator for Climate and Senior Counsel for Air and Radiation Joseph GotTman met w ith r epresentatives from North Amer i can Electric Reliability Corporation. List of attendees attached. On April 21. Administ rator Gina McCarthy spoke with Dan Lashof of NextGen Climate America . On April 21 , Admin istrator Gina McCarthy, Acting Assistant Adm ini strator for Air and Radiation Janet McCabe, and Associate Assistant Adm ini strato r for Climate and Senior Counsel for Ai r and Radiation Joseph Goffman met with representatives from environmental groups, including Friends of the Earth , American Rivers, Clean Water Action. Environment America , League of Conservation Voters, Nat ional Wildlife Federation , Natural Resources Defense Council , Union ofConcerned Scientists. U.S . Cl im ate Action Netwo rk . Environmental Defense Fund , S iena Club , and Earthjustice. On April 21, Associate Assistant Admin istrator for Climate and Sen ior Counsel for Air and Radiation Joseph Goffman met with representatives from the Midwest Power Sector Collaborative. Sign -in sheet and handout are attached . On April 21 , Associate Assistant Administrato r for Climate and Senior Counsel for A ir and Radiation Joseph Goffman met with representatives from Newmont Min in g Corporation . List of attendees attached. On April 21 , Act in g Ass istant Administrator for Air and Radiation Janet McCabe and Associate Assistant Admin istrator for Cl imate and Senior Counsel for A ir and Radiation Joseph Goffman met w ith Van Jones. Sign-in sheet attached.

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### On April 23 , Associate Assistant Administrator for C li mate and Senior Counsel for Air and Radiation Joseph Goffman met with J eanette Pab lo of PNM Resources. On April 24 , Acting Assistant Administrator for Ai r and Radiation Janet McCabe met w ith representatives from the Department of Energy and Climate Change of the United K i ngdom. Sign-in sheet attached.

### Da te: 

### Ap ril 20, 20 15 M eetin g : 

### M eetin g w ith r epr esen t atives f ro m No rth America n El ec tri c Re li abi lity Co rp orat io n Rule (s) Di sc u ssed: 

### C PP Written Ma te ri a l : 

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Nam e T itle and Organiz a tion 

### Ma r k Lauby Seni o r Vi ce P r es ide nt and C hi e f Re li ab ili ty Offi ce r, NE R C Jane t Se na Seni or Vi ce Pr es ide nt and Di rector of Policy and Ex t e rna l A f f a i

rs, NERC Tho mas Bur gess Vice Pres ident and Di recto r. R eliabil ity Assessme nt and P erfo rn1 ance Analys is . NE RC Jo hn Moura T h o mas Co l eman F

ritz H i rs t Li nd a S tunt z Joe Goff man Harvey Reid P

eter Ts irigotis K

ev in C ulli gan Ell e n Kur lan s k y Director. R e liability Assessment, ER C Direc t o r, R e li abili ty Assess ment , NERC Di r ec to r, L eg is lati ve & 

### R eg ul at o r

y Aff a irs, NERC Co ns ultant , N ERC EP A EPA EP A EP A EPA Mikh ail Adaman tiadcs EP A Will iam Meroney EP A Jeb S t e nh o use EPA Ail een Ro der EP A

### Date : A pril 21 , 2015 Meeting: M idw est Power· Sector Co llaborative Meeting Ru le(s) Dis cu ssed : ( ff 

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.MIDWESTERN POWER SECTOR COLLABORATIVE Enabling Interstate Trading under the Cle a n Power Pl a n April13, 2015 Participants i n the Midwestern Power Sector Collaborat i ve (MPSC) request that EPA clearly provide in the final rule that states may adopt state plans that readily and flexibly a ll ow fo r opt- i n interstate t radi ng without the need for formal agreeme n ts between states, so l ong as minimum compatibi lity requirements a r e met. Where minimum compat ibili ty requirements are met, a state w i t h a n app r oved plan s hould be permitted to all ow the use of allowances or credits fr om another state at any time, witho u t gett in g add iti onal EPA approval. The MPSC consists of state officia l s, investor -ow n ed u til ities, gene r ation and transmission cooperatives, merchant generators, public powe r producers and e n vi ronmental organizations from the Midwe st or with a sig nificant Midwe ste rn presence (partic ipant list attached). MPSC participants are exp l oring various potent i a l po li cy pathways for state impl ementation of the antic ip ate d final EPA rul e to r educe ca rb o n emiss i o n s from existing power plants under Section 111(d) of the Cl ean Air Act (dubbed the Cl ean Power Plan ). The s pecific recomme n datio n s su bmitted below e l aborate on co mm ents filed by t h e MPSC on December 1, 2014 w i th EPA, s pecifically Section 2.6.1 ofthos e comme nts. We n ote that t h e reque s t is also consistent with the w ritt e n co mm ents filed by the M idco ntin ent States Enviro nm enta l a nd Energy Regulators (MSEER) in a letter to EPA dat ed November 21, 2014. F or your conve nien ce, we attach bo t h the MP SC co mm ents and the MSEER letter to this request. R

ec ommended Minimum Compatibility Requir e ments Approaches t o inte rs tate trading w it h o ut formal agree m en t s allowed by EPA should confor m to the following minimum co mp atibi li ty requir ements fo r ma ss- b ased and rat e-based in terstate tradin g : Ma ss- Based Inters tate Trading . EPA shoul d app rove a mass-based s tate plan that a ll ows the owners and operators of affected units to u se allowed ton s from any an d all other sta tes with a ma ss-based s t ate plan meeting the following minimum compat ibility co ndition s: • The state's emissions bud ge t ha s been approved by EPA, consistent w i t h its indi vidual state goa l as translated into a mass-based state budget.
• The state's ma ss-base d trading program r equ ires affected EGUs to s urrender all owances in an amount equal to their total emission s during the comp li ance period, the program in clud es m eas ures to assure com pliance , and the total number of allowances iss u ed by the state does not exceed t h e state's em i ss ions budget.
• Program features suc h as price caps, cost -c ontainment r eserves, bank in g or borrowing s h ou l d not di sq ualif y a s tate from p articipat in g in inte rstate trading, so lon g as these program f eat ures do not resu lt in any state invo l ved in tradin g i ssuing m o r e allowances than a ll owed by its EPA-approved emissions budget, and all emissions are covered by allowances.

1EPA sho uld provide the necessary a llowance tracking syste m to track allowances from states that decide to allow owners and operators of affecte d units to u se allowances from other state s. S t a

t e may then u se suc h a syste m , so lon g as appropriate rule s are in place gove rnin g th e transfer of a llowances. EPA should al so allow states to u se their own EPA -a pproved tracking sys tem s, provided that credit transfers between trackin g sys t ems can be handled with integrity
. EPA s hould clarify that no formal agreement, m e mora ndum of understanding or multi state plan shou ld be r equi r ed fo r a s tate meetin g th ese minimum compatibi l ity r eq uirem ent s to accept t h e allowances from a n other state meetin g t he se same minimum compatibility requirements. EPA s h ou ld speci fically re cog n ize that so m e stat es w ill ha ve e mi ssions that exceed their budgets, while others wi ll have e mi ssio n s below th e ir budgets, but the sum of the emiss ion s from parti c ipatin g s t ates will not exceed the s um of the total a ll owed em i ss i o n s. Rate-Based Interstate Trading . So l ong as the carbon e mi ss ion s outcome of trad in g i s not le ss s trin gent than imp l eme ntin g ind ividua l state goa l s se parately without trading , EPA should approve a rate-based state plan that allows the owners a nd operators of affected uni ts to u se c redit s from any othe r state with a rate-ba sed state plan m ee ting the foll ow in g minimum comp at ibility co ndi tions: • Th e state's rate - ba sed trading program will ac hi eve th e EPA-prescribed emissio n s rate goal with certai nty . • Th e state ha s opted to use the sa me unit of trade, whether tons of carbon dioxide or megawatt hours of gene ration or energy saved.
• Prog ram feature s, suc h as t h e me cha ni sm for c r editi n g energy efficiency, r enewables and other credita ble activities, ha ve in te gr ity
. EPA s hould provide th e n ecessa ry credit tracking sys t e m to track credits from state s that decide to a ll ow owners and operators of affected units to use credits from other st ates . States may then use such a sys tem , so l ong as appro priate rule s a re i n place gove rning the tran sfe r of c redits
. EPA shou ld also allow states to use the ir own tracking systems, prov i ded that credit transfers between t rack in g sys t ems can be handl e d with integrity.

2

### Midwestern Power Sector Collaborative Participants, Observers and Staff State Regulator s • Lisa Bonne tt, Director, Ill ino i s Environmental Protection Agency • Vince Hellwi g, Senio r Policy Adviser, Michigan Department of Environmental Quality • Robert Kenney, Chairman, Missouri Public Service Commission (observer) • John Lyons, Assistant Secretary for Cl imate Policy, Kentucky Energy an d Environment Cabinet (observer) • Bart Sponseller, Director, Air Bureau, Wisconsin Department of Natural Resources (observer) • David Th ornton, Associate Commissioner, Minnesota Pollution Contro l Agency • Nicholas Evans, Public Utilities Engineer, Michigan Public Service Commission Regulated Utiliti es • Scott Blankman, Director of Energy Markets & Environme ntal Services, and Michele Pluta , Lead Environm ental Specialist, Alliant Energy Corporation (observer) • Linda Hilbert, Manage r, Environmental Services, Cons um e rs Energy • Jack I h i e, Director of Environmental Policy & Ni cho l as Martin, Manager, Enviro nm enta l Policy, Xcel Energy • Kris McKinney, Manager, Environmental Policy, We Energies (observer) • Greg Ryan, Senior Technology Specialist, DTE Energy, Inc. • Cathy Woollums, Senior Vice President, Environmental Services and Chief Environmental Counsel, Berkshire Hathaway Energy on behalf of Mid -American Energy Generation and Transmission Cooperatives • Bob Ambrose, Director, Governmental Affairs & Mary Jo Roth, Manager, Environmental Services, Great River Energy • Don Huff, D irector of Environmental Affairs & Nathan Franklin, Government Relations, Dairyland Power Cooperative (observer) • Steve T omac, Senior Legis l ative Representative , Basin Elect ri c Power Cooperat ive (observer) • Bri a n Warner, Vice President, Envi ro nm e ntal St r ategy, Wolverine Power Coope ra t ive Merchant Power Provider • Shawn Konary, Environmental Director, NRG (parent company of Midwest Generation) & Maria Race, Director of Asset Management, NRG Municipal Joint Action Agency • Andy Kellen, Vice President, Power Supply Resources, WPPI Energy Environmental Organizations • Nathaniel Baer, Ene r gy Program Di rector, Iowa Environmenta l Council • Nicholas B i anco, Directo r of Regulatory Analysis and Strategic P artnersh i ps, Env iro nm enta l Defense Fund • Mike Bull , Director of Policy a nd Comm uni cat ion s, Cente r for Ene rgy a nd Environm ent • Trent Dougherty, Managing Director, Legal Affairs, Ohio Environmenta l Council • Steve Frenkel, Midwest Director, Union of Concerned Scientists • Charles Griffith, Climate & Energy Program Director, The Ecology Center • Keith Reopelle, Senior Policy Director, Clean Wisconsin • Conrad Schneider, Advocacy D irector, and Jonathan Banks, S r. Cl im at e Policy Adv i ser, Clean Ai r Task Force Staff • Brad Crabtree, Vice President, Fossil Ene rgy , Great Plains Institute • Franz Litz, Program Consultant, G reat Plains Institute • Doug Scott, Vice President, Strategic Initiat ives, Great Plains Institute 3

### Dat e: 

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### Meeti ng with representatives from ew mont Mining Corporation Rul e(s) Disc ussed: 

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### Gavin J a ngard New mo nt Mining Corporation Denni s Lay bourn Ne wmont Mining Co rporation Mary Beth Donnelly New mo nt Minin g Co rp o ration Em il y Schi lling Holland & 

### Hart LLP Joe Goffman E PA Sarah Dunh a m EPA Harvey Re id E PA Pet er Tsirigotis EPA Kevin C ulli gan EPA

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