# May 19, 2011

MEMORANDUM

From: William H. Maxwell

EPA/SPPD/ESG (D243-01)

To: Docket Number EPA-HQ-OAR-2009-0234

Subject: Webinar with Edison Elec tric Institute (EEI)

Attendees :

EPA:

Kevin Culligan, EPA/OAQPS/SPPD/ESG

EEI:

Dan Chartier, EEI

John Kinsman, EEI

Karen Obenshain, EEI

Michael Rossler, EEI

David Finnegan, Counsel to EEI

Paula Hamel, Dominion

Mary Kenkel, Representing Em pire District Electric

Scott Lawton, Dominion

Paul Lobo, Representing ConEdison

Kristy Monk, AEP

George Baker, Representing OGE

Webinar participants:

See attached.

Discussion :

The attached materials were discussed.

# 2420 Mosside Boulevard Monroeville, PA 15146 Tel: +1 412-373-6964 Fax: + 1 412-373-6967 To: Dan Chartier

Date: Thursday, May 19, 2011 10:00 AM Eastern

E-Mail Address: dchartier@eei.org

Company Name: EEI

Host's Name: Dan Chartier

Conference Name: EEI(10:00A)EE 7926270

Conference Title: EPA HAPS MACT Briefing

Participant Information

1. Alban, Tom Buckeye Power

2. Alexander, Bruce Exelon

3. Amos, Jonathan Xcel Energy

4. Anderson, Janet Van Ness Feldman

5. Anderson, Ken Ameren

6. Arechiga, Jacob Jackson Walker

7. Ayres, Tate IPL

8. Baez, David Orlando Utilities

9. Baker, Michael UGI

10. Barlow, Chuck Entergy

11. Batcher, Mike Cornbelt Power Cooperative

12. Bell, Dan Alliance Energy

13. Bentley, Joe Lower Colorado River Authority

14. Blake, Frank AEP

15. Blattner, Ray Buckeye Power

16. Bleth, Craig Minnkota Power Cooperative

17. Blount, Lestor Minnesota Power

18. Botkin, Eric Tuscon Electric Power

19. Bowers, Darrell WE Energies

20. Bowman, Erica Edison Mission Group

21. Boyd, Skiles DTE Energy

22. Breining, Heather Consumers Energy

23. Brewer, Richard Duke Energy

24. Britto, Erin DTE Energy

25. Brown, Gary Entergy

26. Brown, Louis Orlando Utilities Commission

27. Brown, Megan Philadelphia Gas Works

28. Bruntz, Sam Alcoa

29. Burke, Dwayne* Indianopolis Power and Light

30. Butcher, Gerald Western Farmers Electric

31. Butler, Rick Cipco

32. Butler, William Jennon Energy

33. Cain, Stephen Arkansas Electric Cooperative

34. Callan, John Mid American Energy

35. Canada, Daniel SCE&G

36. Chacon, Roger El Paso Electric

37. Chamberlain, Ledge Northeast Utilities

38. Chartier, C/Dan *****

39. Chinn, Todd Nebraska Public Power District

40. Choi, Caroline Progress Energy

# 2420 Mosside Boulevard Monroeville, PA 15146 Tel: +1 412-373-6964 Fax: + 1 412-373-6967 41. Chu, Paul EPRI

42. Clark, Evan Santee Cooper

43. Cohen, John Alstom

44. Connor, Patrick Corn Belt Power Cooperative

45. Cornmiller, Rae NARCA

46. Coss, Terry Xcel Energy

47. Dalton, Trevin Entergy

48. Dauteuil, Richard Buckeye Power

49. Davis, Kelvin Duke Energy

50. Deliberto, Steve Indianapolis Power and Light

51. DeMasi, Cosimo First Electric Power

52. Dhurman, Steve Excl Energy

53. Diamond, Matt Power South Energy

54. Diekvoss, Craig Rochester Public Utilities

55. Donegan, Roger Burlington Vermont Electric

56. Drake, Bob Ottertail Power

57. Eames, Fred Hunton & Williams

58. Eckland, Gwen West Associates

59. Eutizi, Joe Sana Miguel Electric Cooperative

60. Finchum, Gary IPL

61. Flemming, Britt Van Ness Feldman

62. Flinta, Dan Indianapolis Power and Light

63. Freeark, Michelle Arizona Electric Power Cooperatives

64. Freeman, Lauren Hunton and Williams

65. Friedrich, Harry Grand River Dam Authority

66. Fulle, Doug Ogelthorp Power Corp

67. Galbraith, Brett Lakeland Electric

68. Galbray, Mike Big Rivers Electric Corporation

69. Gallinger, John Alstom

70. Garrison, Sean Ameren

71. Gaus, Chris American Electric Power

72. Gibson, Rick Xcel Energy

73. Gionfrieddo, Tracy Northeast Utilities

74. Goodman, Naomi Electric Power Research Institute

75. Goodman, Naomi Electric Power Research Institute

76. Graves, John Minnkota Power Cooperative

77. Grealy, Ann First Energy

78. Green, Brian Genon

79. Gregg, Kaitin Van Ness Feldman

80. Gross, Tom Chubu Electric Power

81. Hagley, Tim Elite Minnesota Power

82. Hantz, Joseph * Entergy

83. Harnach, Lea Xcel Energy

84. Hartman, Doug First Energy

85. Hatfield, Jennifer ID Power & Light

86. Helfrich, Curt Buckeye Power

87. Hendricks, John American Electric Power

88. Hershey, Patti Lower Colorado River Authority

89. Hildeson, William American Electric Power

90. Hill, Matt Edison International

91. Holbrooks, Kevin JEA

92. Holdsworth, Eric EEI

93. Hopkins, Leonard Southern Illinois Power Cooperative

# 2420 Mosside Boulevard Monroeville, PA 15146 Tel: +1 412-373-6964 Fax: + 1 412-373-6967 94. Hopson, Eli Edison Emission Energy

95. Horgan, Tom Ameren

96. Hossain, Natalie Colorado River Authority

97. Howard, Nikia Alabama Power Co.

98. Hutson, Nick US EPA

99. Hughes, Kimberly AEP

100. Ihle, Jack Excel Energy

101. Jabbs, Curtis Haston Electric Power Cooperative

102. Jackson, Paul American Elec Power

103. Jamieson, Sean Van Ness Feldman

104. Jefferson, Dina Nisource

105. Jezouit, Debra Baker Botts

106. Jo, Mary Roth Great River Energy

107. Jones, Morgan First Energy

108. Jurassic, Mike First Energy

109. Kaps, Bill Sunflower Power Electric Corp.

110. Kelly, April South Carolina Electric and Gas Company

111. Kennedy, Mike * Progress Energy

112. Khyos, Mike OUC

113. Kimura, Karen Hawaiian Electric Co.

114. Knowles, Verdell JEA

115. Kropp, Edward Jackson Kelly

116. Kubasik, Brenda Madison Gas & Electric

117. Lang, Paul Kansas City Power & Light

118. Lare, Garfield OUC

119. Lee, Angie Hoosier Energy

120. Lee, Gail Rubercht Jackson Kelly

121. Lempke, Doug Tristate Generation and Transmission

122. Levin, Leonard AE

123. Lipscomb, Jason OG&E

124. Lopez, Francisco Puerto Rico Electric Power Authority

125. Lucey, Jay National Grid

126. Madhusudhan, Cherie Northeast Utilities

127. Madison, John Montana Dakota Utility

128. Magno, Gary Xcel Energy

129. Maikisz, Joseph NextEra Energy

130. Manousos, Peter First Energy

131. Marabella, John AES

132. Marchetti, Jim James Marchetti, Inc.

133. Marion, Michelle Consumers Energy

134. Markham, Sarah Southern Co.

135. Matthews, Bill CLECO Corp.

136. Mattox, Terry AES

137. Maxwell, C/Bill US EPA

138. McKenny, Chris WE Energies

139. McMahon, John * American Electric Power

140. McNeill, Laura Energy Future Holdings

141. Mehta, Khurshid TVA

142. Messinger, Lisa Vectren

143. Metcalf, Dean Xcel Energy

144. Michaud, David WE Energies

145. Miiler, Scott Edison International

146. Miller, Jenny AEP

# 2420 Mosside Boulevard Monroeville, PA 15146 Tel: +1 412-373-6964 Fax: + 1 412-373-6967 147. Monk, Christi American Electric Power

148. Montalvo, Kara Salt River Project

149. Moore, Kevin East Kentucky Power

150. Morley, Kevin Xcel Energy

151. Morrin, Bill ACES Power Marketing

152. Morris, Larry East Kentucky Power

153. Munger, Brenner Hawaiian Electric Co

154. Nicks, Leroy Alban Power Company

155. Noland, Steve Big Rivers Electric Corporation

156. O'Donnell, John Xcel Energy

157. Olberding, Jake Cornbelt Power Coop

158. Oliphint, Bob Illuminant

159. Ollberding, Jake Cornbelt Power Coop

160. Oppenheimer, Stev e Hawaiian Electric

161. P211, Guest 7926270

162. Penrod, Wayne Sunflower Electric

163. Plantico, Reuben Portland General Electric

164. Plantico, Ruben Portland General Electric

165. Pluta, Michele Alliance Energy

166. Pocalujka, Lou Consumer's Energy

167. Prepice, Jaspon Coopers Water Company

168. Price, Mimi Scanner Corporation

169. Price, Randy Con Edison

170. Pride, Ann Entergy

171. Pritchard, Keith Puget Sound Energy

172. Pugh, Theresa APPA

173. Quinley, Heather Duke Energy

174. Radcliffe, Darlene Duke Energy

175. Raphael, Joann EPL

176. Reimann, John AES

177. Reina, Juan Tampa Electric

178. Remidis, Juan Seminole Electric

179. Retherford, Angela Vectren

180. Reynolds, Paul Sunflower Electric

181. Rise, Russell Associated Electric

182. Roberson, Ralph RMB Consulting

183. Rodriguez, Angela BPS Energy

184. Roland, Eric Genon Energy

185. Schuh, Donald Ameren

186. Schultz, Paul Flat River Power Authority

187. Scobee, Al City of Hamilton OH Power Plant

188. Scott, Darrell AEP

189. Sewell, Mike Progress Energy

190. Shimchock, John Jenon Energy

191. Siedhoff, Tom ACC CE

192. Slade, William Con Edison of NY

193. Small, june North Carolina Membership Corporation

194. Smith, Tim West Star Energy

195. Sossaman, Hank South Mississippi Electric

196. Spooner, Brad MEAG Power

197. Standon, Kathleen WE Energies

198. Stange, Marty Hastings Utilities in Hastings, Nebraska

199. Stangy, Marty Hastings Utilities

# 2420 Mosside Boulevard Monroeville, PA 15146 Tel: +1 412-373-6964 Fax: + 1 412-373-6967 200. Stansbury, Gary East Kentucky Power Coop

201. Steele, Mark Alabama Power

202. Stifermann, Mike Central Electric Power Coop.

203. Stinger, Jennifer Progress Energy

204. Stretchberry, St eve WE Energies

205. Strimbu, Mark Nisource

206. Strohfus, Mark Great River Energy

207. Sullivan, Vicky ACCCE

208. Surface, Mike Dominion

209. Sutton, Cash Sutton Enterprises

210. Terry, Greg Gulf Power

211. Thullesen, George* The Empire District Electric Company

212. Thurman, Steve Xcel Energy

213. Tolbert, Todd AECI

214. Trojecki, Amy Exxon

215. Trouers, Brian * Ames Municipal Electrical Service

216. Vanek, Jason Nebraska Public Power

217. Vaughan, Lloyd Oglethorpe Power

218. Velasco, Rob Tampa Electric Co

219. Walraven, Tashia (Ms.) Consumers Energy

220. Waltman, Chris Integrys

221. Waters, Dwayne The Power Company

222. Watson, Stephanie Consumers Energy

223. Waxman, Cathy National Grid

224. Wayland, C/Bob US EPA

225. Weaver, Scott* American Electric Power

226. Welch, Chris Colorado Springs Utilities

227. West, Jeff Xcel Energy

228. Weston, Aaron Dow Lohnes Govt. Strategies

229. Whitworth, Steve Ameren

230. Whitworth, Steve Ameren

231. Wiley, Michaeline Hoosier Energy

232. Wilkerson, Jason Louisville Gas & Electric

233. Wilkus, Dan West Star Energy

234. Williams, Harold Northeast Utilities

235. Wilmor, Sky City Water Light and power

236. Wilson, Tim Empi re District Electric

237. Wise, Dan Duke Energy

238. Wong, Cynthia Edison International

239. Wong, Cynthia Edison International

240. Wright, Linda Exelon

241. Zeugin, Lee Hunton and Williams

*Denotes participant asked a question during the AUDIO Q&A SessionReducingToxicPollutionfromPowerPlants’fEPAsProposedNationalEmissionsStandardsorHazardousAirPollutantsforCoal‐andOil‐FiredUtilitiesEdisonElectricInstituteMay19,2011OverviewoftheRegulatoryAction•OnMarch16,theAdministratorsignedtheproposedNationalEmissionsStandardsforHazardousAirPollutantsforCoal‐andOil‐FiredUtilities,thefirstnationalstandardstoreducei it iill t tfdi tildfi dl tftemssonsofoxcarpouansromnewanexsngcoa‐anoil‐repowerpans–oenthebiggestcontributorstoairpollution•Standardswouldreduceemissionsof:Metalsincludingmercury(Hg)arsenic(As)chromium–,includingmercury,arsenic,chromium(Cr),andnickel(Ni)– Acidgases,includinghydrogenchloride(HCl)andhydrogenfluoride(HF)– Particulatematter•ThestandardswouldalsoresultinadditionalreductionsofSO2emissionswhichbyreducingstandardsadditionalreductions2emissions,which,byreducingambientSO2andparticlelevels,willpreventthousandsofdeathsandhundredsofthousandsofillnesseseachyear•Standardscreateuniformemissions‐controlrequirementsbasedonprovencurrentlyin‐use,technologiesandprocesses•CompliancetimelinesetbyCleanAirAct:upto4years(3yearsplusanadditionalyearifgrantedbythepermittingauthority)•EPAisalsoproposinganewsourceperformancestandard(NSPS)forparticulatematter,sulfurdioxide(SO2),andnitrogenoxide(NOX)emissionsfromnewsources2PowerSector:AMajorShareofU.S.AirEmissionsNitrogenOxides(NOx),200915.3MillionTons2.0MillionTons2 6BillionTonsSulfurDioxide(SO2),20099.5MillionTonsCarbonDioxide(CO2),20086.5BillionTonsjOtherSectorsOtherSectors13.3MillionTons87%13%ElectricPower2.6BillionTons40%3.8MillionTons40%ElectricPowerOtherSectorsElectricOtheremissionsinclude:Tracemetals(nickelarsenicParticulateMatter (PM10),2008Mercury(Hg),2005105TElectric5.7MillionTons60%3.9BillionTons60%PowerTracemetals(nickel,arsenic,seleniumandothers)HCl,HFDioxin/furansTraceorganicsOthers(e.g.,cyanide)14.8MillionTons105TonsElectricPowerElectricElectricPower53Tons50%0.5MillionTons4%RadionuclidesEmissionshavesubstantialpublichealth,environment,andotherwelfareimplications.PowerOtherSectors14.3MillionTons96%OtherSectors52Tons50%Sources:NEITrendsData(2009)andCAMDData&Maps(2010)(SO2,NOX)NEITrendsData(2009)(PM10)2005NATAInventoryModifiedfortheUtilityMACT2005BaseYear(2010)(Hg)InventoryofU.S.GreenhouseGasEmissionsandSinks:1990‐2008(2010)(CO2)“Other”sourcesincludetransportation,othermobilesources,andindustrialsources3IntheU.S.,PowerPlantsEmit:20%ofthechromium13%oftheNOx30%ofthenickel60%oftheSO250%ofthemercuryover50%ofmanyacidgases60%ofthearsenicorganics,dioxins/furans,andothersSources:NEITrendsData(2009)andIPM(2010)(SO2,NOX);P dild lil froposedtoxcsruemoengpatorm,basedoninventoryusedfor2005NATA(Hg);Inventoryusedfor2005NATA(othertoxics)4HistoryofCleanAirActPowerPlantControlsforAirToxics•1990CleanAirActAmendmentscreatedAcidRainprovisionsandrevisedprovisionstorequirecontrolstoreduceemissionsoftoxicairpollutantsfromindustrialsources•EPAwasrequiredtodoastudywithin3yearsandthenlistpowerplantsforregulationundertheairtoxicsrequired,regulationprovisionsiftheAdministratorfoundthatitwasappropriateandnecessary•1998:EPAreleasedUtilityToxicsStudyReporttoCongress•2000:EPAlistedpowerplantsforregulationundertheCleanAirActairtoxicsprovisions•Oncelisted,EPAhad2yearstoissueanairtoxicsstandard•Mercurycitedaspollutantofgreatestconcernbutothertoxicsincludearsenic,chromium,cadmium,nickel,hydrochloricacid,dioxin/furan•2005:EPAreversedfindingSection112(n)RevisionRulede‐listedpowerplantsreversed2000findinginSectionRevision,fromregulationunderairtoxicsprovisions,andfinalizedCleanAirMercuryRule(CAMR)– allowingtrading•2008:DCCircuitfoundthede‐listingtobeillegalandvacatedtheSection112(n)RevisionRuledCAMRan•2010:EPAentersaConsentDecreerequiringtheAgencytosignproposedsection112(d)standardsforutilitiesbyMarch16,2011,andsignfinalstandardsbyNovember16,2011.•Compliancebyexistingsourceswillberequired3‐4yearsafterthefinalstandardsarepublishedinlate5pygqyp2011orearly2012•Aquarterofacenturywillhavepassedsincethe1990CleanAirActbecamelawPowerPlantsAretheLargestRemainingSourceofMercuryEmissionsSMercuryEmissionsintheU.S.•In1990threeindustrycategoriesmade1990 2005 %gapproximatelytwo‐thirdsoftotalU.S.mercuryemissions–TwoofthethreearenowbjiiIndustrialCategoryEmissionstons peryear (tpy)Emissions(tpy)Reductionsubjecttoairtoxicsstandards–SoaremanyotherindustriessuchascementplantsandsteelPowerPlants59 53 10%MunicipalW t57296%pmanufacturers•Today,20yearsafterthe1990CAAAmendmentsdFd lli ifWasteCombustors57296%MedicalWaste 51 <1 >98%passed,noFederallimitfortoxicemissions– includingmercury– existsforcoal‐oroil‐firedpowerplantsIncinerators%Source: EPA’s 2005 NATA Inventory Modified for the Toxics Rule 2005 BaseYear (2010)6AffectedFacilities:1,350CoalandOil‐FiredatPowerPlantsUnits525•Approximately1,200coal‐firedunits– 45%percentofnationwideelectricitygeneration•Bituminouscoal~50%ofcoalgeneration•Subbituminous~45%ofcoalgeneration•Lignite~5%ofcoalgeneration– Includesunitsthatburncoal,coalrefuse,asyntheticgasderivedfromcoal,orsolidoil‐derivedfuel(e.g.,petroleumcoke)eitherexclusively,inanycombinationtogether,orinanycombinationwithothersupplementalfuelsthatarenotsolidwastes•Approximately150oil‐firedunits– 1%ofnationwideelectricitygeneration•Naturalgaspowerplantsarenotaffectedbythisrulef lldl•EPAexpectsmostaciitieswouinstalltechnoogiestocomplywiththisrule7LocationofCoal‐andOil‐FiredPowerPlantsSource:National Electric Energy Data System (NEEDS 4.10) (EPA, December 2010)8WhattheToxicsRuleProposes•Coal‐andoil‐firedpowerplantsarecoveredbythisrule•Allhazardousairpollutantsmusthavestandards•EPAmustsetemissionstandardsforexistingsourcesinthecategorythatareatleastasstringentastheemissionreductionsachievedbytheaverageofthetop12%bestcontrolledsourcesforsourcecategorieswith30ormoresources•Emissionsaveragingwithinacontiguousfacilityisallowedincertaincircumstances•MonitoringRequirements–State‐of‐the‐artemissionsquantificationthatprovideshighqualitydata•HgCEMSorsorbenttrapsformercury•HClCEMSorSO2CEMSforacidgases2•PMCEMSformetals•30‐dayaveragingperiodformonitoringaccommodatesprocessvariabilityand,coupledwithCEMS,facilitatescompliance•Recordsofworkpracticestandards(annualtuneups)areproposedfororganicHAPemissions9WhattheToxicsRuleProposes(cont.)•RequirementsforCoal‐firedUnits–Mercury:numericemissionlimitwouldprevent91%ofmercuryincoalfrombeingreleasedtotheair–AcidGases:HClnumericemissionlimitasasurrogate,withanalternatesurrogateofSO2–Non‐mercurymetallicpollutants(e.g.,arsenic,chromium):numericemissionlimitfortotalPMasasurrogate,withanalternatesurrogateoftotalmetalairtoxics–Organicairtoxics(includingdioxin/furans):workpracticestandards,insteadofnumericemissionlimits,duetolow‐detectedemissionlevelsintheICRdata.Wouldensureoptimalcombustionpreventingdioxin/furanemissions•RequirementsforOil‐firedUnits–AcidGases:HClandHFnumericalemissionlimitsMetalAirToxics:numericalemissionlimits(includingmercury)–Toxics:numericalemissionfortotalmetalairtoxics(includingmercury)withindividualmetalairtoxicnumericallimitsasanalternate–Organicairtoxics(includingdioxin/furans):workpracticestandards,insteadofnumericemissionlimitsduetolow‐detectedemissioninWouldensureemission,detectedemissionlevelstheICRdata.optimalcombustionpreventingdioxin/furanemissions10EmissionsfromCoveredSources5 87SO2Emissions52.960HgEmissions5.83.83.73.51.71.71.723456

M illion Tons52.929.129.429.620304050

TonsThbi ldhTR ld1.71.70122009 2015 2020 2030

M6.46.56.6010202005 2015 2020 2030►ThebasecaseincludestheTransportRuleasproposedandallotherexistingFederalcontrolsandFederallyenforceableagreements►EmissiontotalspresentedherereflectallcoveredcoalsteamandIGCCelectricgeneratingunits>25MW351.6250300350400

o nsHClEmissionssteamandIGCCelectricgeneratingunits>25MW►ThepolicycaseimposesmercuryandHClemissionratelimitationsontheseunits,andrequiresfabricfiltersonasubsetofthoseunits►Themercurycontentofthecoalconsumedinthebase74.470.864.86.66.97.2050100150200250

Thousand T oNote:HistoricHClemissionsbasedonsingleemissionfactor;projectedemissionsbasedonfuel‐specificClassumptionsandremovalefficiencies.ycasebyEGUs>25MWis75tonsin2015;emissionsfromthoseunitsundertheToxicsRulerepresentmorethana90%reductioninthatmercury1102005 2015 2020 2030SourcesCanAchieveTheseStandards•Provencontroltechnologiestoreducetheseemissionssuchasscrubbers,fabricfilters,andactivatedcarboninjectionarewidelyavailable•Manyunitsalreadyuseoneormoreofthesetechnologies•Asaresultofthisstandard,somepowerplantswillupgradeexistingcontrols(especiallyparticulatemattercontrolslikeelectrostaticprecipitators)•Powerplantsinstallcontrolsasfiltersdrysorbentinjectionmayalsoinstallnewcontrols(suchfabricfilters,sorbentinjection,oractivatedcarboninjection)300350BaseP dT iR lRetrofitpollutioncontrolinstallationsoncoal‐firedcapacity(bytechnology)withthebasecaseandwiththeproposedToxicsRule,2015(measured174141175146146243100150200250

5 Capacity (GW)ProposedToxicsRuleinGWcapacity). Source:IntegratedPlanningModelrunbyEPA,2011FGD:fluegasdesulfurization(scrubber)DSI:drysorbentinjection29953775465050100WetFGD DryFGD DSI SCR ACI FF

201 5SCR:selectivecatalyticreductionACI:activatedcarboninjectionFF:fabricfilterFGD – 96% SO2removal; 99% HCl removal DSI – 70% SO2removal; 90% HCl removalSCR – 80% NOx removal ACI – 90% Hg removalFF – PM control12CostandRetirementProjections►PrivatecompliancecoststoutilitiesaredistinctfromtheoverallsocialcostofthepolicyThe$15IncrementalComplianceCostforthePowerSectorfromtheoverallsocialcostofthepolicy.ThecompliancecostsdepictedareincreasedcostsofoperatingtheelectricgenerationsystemthroughouttheU.S.$10.9$10.1$10.0$5$10$15

B illions $2007►Incrementalretiredcoalcapacityin2015isabout10GW.Also,itisimportanttorecognize:$02015 2020 2030

B►EPAidentifiedabout11GWoffirmretirementsannouncedfor2010‐2015thatwereremovedfrommodeling►EPAmodelingsuggestsforecastednaturalgaspricesalonecloseabout4GWofcoalfired9.871015

W )IncrementalRetiredCapacityin20152015Capacity(beforeretirements)pricesalonecloseabout4GWofcoal‐firedcapacityin2015inthebasecase,andTransportRulemaycloseanadditional1GW►ToxicsRuleandTransportRule(asproposed)togetherclose11GWofcoalin2015‐0.18‐0.46‐0.7705

Capacity (G WTotal:1,028GWCoalSteam&IGCC:314GWg►ClosuresaredistributedthroughouttheU.S.13‐5CoalSteamCCCTNuclearAverageConsumerElectricityPriceProjections150

hAverageNationalRetailElectricityPriceBaseProposedToxicsRule1401602015RetailElectricityPriceBaseProposedToxicsRule9089102939210450100

0 7

‐ year mills/kW h406080100120140

2007 mills/KWhNationalaverageincreaseof3.7%in2015that02015 2020 2030

20 0020declinesovertime100120140160

K Wh2020RetailElectricityPriceBaseProposedToxicsRule020406080100

2007 mills/ K14GenerationandCapacityProjections10IncrementalNewCapacityNaturalGasCCWindBiomass0.290.290 250 250.29 0.290.330.3345GenerationMixOtherOil7.400.68468

C apacity (GW)NaturalGasCCWindBiomass2.001.962.021.982.062.010.830.830.830.840.810.820.690.730.830.871.161.210.290.290.29 0.290.250.251234

Million GWhNon‐HydroRenewablesHydroNaturalGasN l2.77022015 2020 2030

C1.961.9801Base ToxR Base ToxR Base ToxRNuclearCoal2015 2020 2030Marginal amounts of incremental wind (20 MW by 2015) andbiomass (80 MW by 2020) capacity are unlabeled in this graph►Coal‐firedgenerationisslightlyreducedasaresultoftheproposedrule►Increaseindemandismetlargelywithadditionalnaturalgas‐firedgenerationbiomass(80MWby2020)capacityareunlabeledinthisgraph.►IPMresultssuggestthatthesectorwillbeabletocomplywiththeToxicsRulewhilerelyingprimarilyonexistinggeneratingassets►Overcapacityatexistingcombinedcycleunitsrespondstodisplacedgenerationin2015►Anadditional8GWofnewcapacityisprojectedby2030relativetothebasecase,mostofwhichisnaturalgascombinedcycle15ImpactsonCoalConsumptionandNaturalGas•CoalusefrommajorregionsdecreasesslightlyfromtheproposedToxicsRule.Thereisaslightincreaseinuseofinteriorcoalsinsomeyears.•Thereissomeincreaseinbituminouscoaluseand1831741651541533030373738381,0001,200PowerSectorCoalUseImportsWasteCoalAppalachiaInteriorWest•Thereissomeincreaseinbituminouscoaluseanddeclineinothercoaltypesused942551543557553599567227233239228240252183168174165153200400600800

Million TonsC lUbR k0Base ToxR Base ToxR Base ToxR2007 2015 2020 2030•Naturalgasconsumptionisexpectedtoincrease3‐6percentbythepowersectorfrom201520307,7627,6687,9847,8858,599 8,0739046091,05965171865715,00020,00025,000

BtuCoalUsebyRankLigniteSubbituminousBituminous2015‐2030•Overthistime,“delivered”naturalgaspricestothepowersectorandatHenryHub(wellhead)willhaveanaverageincreaselessthan10centspermillionBtus,about1.3percent11,45011,62811,29711,54711,44011,70305,00010,000

Trillion,p•Overthistime,residentialconsumerswouldseeanaveragepriceincreaseoflessthan1percent1602015Base2015ToxR2020Base2020ToxR2030Base2030ToxRTheToxicsRule:Implementation•Whenwecomparetheinvestmentsthatwillberequiredtocomplywiththesestandardswithinvestmentsthatthissameindustryhasmadeinthepasttheydol kflinotoooutone–Ineachof2007through2010,over20GWsofadvancedpollutioncontrolequipmentwasinstalled.Thisincludesapeakofover35GWsofscrubbersandSCRsin2009.•TheActcontainskeyflexibilitiessuchasprovidingpermittingagenciesthediscretiontoprovide1‐yearextensionstoinstallpollutioncontrols(beyondthegeneral3‐yeartime‐frameforcompliancerequiredbytheAct)thatwillbekeytoaddressinganyfacility‐specificconcerns.•Whileweprojectsomeretirementsofold/inefficientandlessfrequentlyusedcoal‐firedgeneration,thelargeamountsofextrageneratingcapacitythatcurrentlyexistwillabletoensurereliableelectricity(NERCdefaultreservemarginsbekeytobeingreliableelectricitydefaultreservemarginsare15%,absenttherule,averagecapacitymarginsareabout25%).17PublicHearingsandComment•ThepublicisencouragedtoprovideEPAwithcommentsonthisproposedToxicsRule– ProposedrulewaspublishedMay3,2011(76FR24976)Thi dilldJ l52011–ecommentperowenonuy,.– TheproposedruleisavailablethroughEPA’swebsites•http://www.epa.gov/ttn/atw/utility/utilitypg.html•http://www.epa.gov/airquality/powerplanttoxics/actions.html•PublicHearings– Locations•May24PhiladelphiaPA(WestinPhiladelphia):Philadelphia,(WestinPhiladelphia)•May24:Chicago,IL(Crowne PlazaChicagoMetro)•May26:Atlanta,GA(EPARegion4Headquarters)–Formoreinformationonhowtoattendthesepublichearinspleasevisit:g ,http://www.epa.gov/airquality/powerplanttoxics•TechnicalContact:–BillMaxwell(919‐541‐5430,maxwell.bill@epa.gov)18Summary– Bottom‐Line•Thisproposedrulewillresultintremendouspublichealthbenefits,worthmanytimesthecost•Therulewillrequirethepowersectortoinvestincommerciallyavailable,costeffective,proventechnologies‐thisinvestmentwillprovidejobsfortfth dfA id ii dfhi hl tensoousansomercansurngaperoogunempoymen,createdemandforproductslikecement,thatareexperiencinglowdemand,andcreateamoderncleanAmericanpowersector•Thisrulehasbeenlongdelayed.Itisimportantforpublichealth,andtheproposedruleisconsistentwiththerequirementsoftheCleanAirActThank you!William H MaxwellWilliamH.MaxwellEnergy Strategies Group(919) 541-5430maxwell.bill@epa.gov