Date: n~, ~~Jt/UJir cJ' .<.,:OJ¥Wl 

Meeting: v{ i'tL COJbt~ ~Qy....£r) 

Rule(s) Discussed: 0 toru.L !VAA-& 5> J(.J._}.l.vrY\~'j 

Written Materials? Yes/No 

Name Organization Phone Number 

J~\ V1ssv S rJ {-~t'r A<.,~~~ J-u1 1 xr ~<ff7 

v; r (' (( ~e v k /~ <!,---. A!Afi/1 J02 (J7 J 17<( 

~6"J?_Je~~ /J!Jfo1 ~~ G 37-3 !7? 

A. ~~u_ :(J) N~ /c /[\ zu :)__ ~~~ cr J-2 r ~~~~~'v-~ J\9 t r-v >\-\ ) V>1 . .s; ~g 

~lbvtn {oo_07 ' ~kt Jl [:Pf'r I ;zy -9d1 - ros) 

~l~ }!I eGA f?.TLANO EPA f)C{)-56 6- 2 2..4Lf 

[-I I· -c-j?Jr,~_ ~f) ) . ) ~P!\ /.ulJ_('t 6 1l1/ 

0 
NERA 

ECONOMIC CONSULTING 

sing the Potential Economic Impacts 

5 ppb Ozone NAAQS 

nomic Consulting 

Insight in Economics"' 
Used in NE 's Analysis to 

ate Compliance Costs 

case emissions by state and year (EPA) 

ment tons by state (EPA) 

ctions needed by state (EPA) 

sted for correct timing of attainment (NERA) 

ions reduction costs 

wn" control costs (EPA) 

-fired EGU closures/retrofits (NERA modeling) 

nown" control costs (NERA) 

,. 

DlJ 

ECONOMIC CONSULTING 
!'Ox Emissions (thousand tons) 

1990 

1992 

1994 

1996 

1998 

2(00 

2002 

2004 

2006 

2008 

2010 

281~ 

2018 

2022 (Moderate) 

2025 

2031 (Severe) 

2036 (Extreme) 

0 

~ ~ tv N uJ 

U'l 0 Ul 0 V1 0 ~ v v v ~ v 0 0 0 0 0 0 

0 0 0 0 0 0 

0 0 0 0 0 0 

I 

I 
for EPA's Esti111ate of 2025 

liance Costs 

ns totals are only in states needing reductions) 

-•

. 

NERA 

ECONOMIC CONSULTING 

NOx 

(MM tons) 

Annualized Cost 

(2011 $, Billions) 

2025) I 6.3 

----- ~~~- --

- ~< -

 compliance (0.6) $0 

- -

--

25) 5.7 

trols (0.9) $1.6 --~, -- --

Controls (0.2) I $1.7 

ontrols (0.9) $13 

- -

- ---

Emissions 3.7 

ons from Baseline 2.0 $16 

3 
) Use 2022 

compliance 

2022 

rols 

NOx 

(MM tons) 

_£3 6.6 

{M} (0.3) 3 (-9:9) (0.8) 

-

. ', 

NERA 

ECONOMIC CONSULTING 

Annualized Cost 

(2011$, Billions) 

$0 

$1.6 

ontrols 34 GW closures 

ntrols 

(0..-21 (0.8) 

(-9:9) ( 1.0) 

$t:T{in model) 

$13 ?? 

missions 3.7 

ns from Baseline 2.0 $16 

alculations. 

eline reflects 2022 conditions in each state requiring reductions, with two 

Base Case for UT and CA reflect conditions in 2031 and 2036, 

ed on higher likely severity classifications in those two states. 

4 
Emissions Sources Must Provide 

st 1 Million Tons of Reductions? 

-

. 

NERA 

ECONOMIC CONSULTING 

• Known Controls & EGU reductions in NERA analysis 

• Emissions Remaining 

0-v ~ ~'I ·~ «:-Ill C:J ,<:-ov ~o ~ "'flj 

0~ 

~' 

~ 

cP 

 

rb-0 

0~0 

r~>o ~0 ~o<::-

Remaining 

sources of 

. . em1ss1ons are 

mostly small 

&lor mobile 

Bar chart reports emissions only in states 

requiring reductions under 65 ppb standard. 5 
Will It Cost to Get 1 Million 

ro111 the Re111aining Sources? 

-

. 

DlJ 

ECONOMIC CONSULnNG 

analysis assumed all the additional controls can be 

ed for an average of $15,000/ton 

echnology cost evidence to support this assumption 

s took a more evidence-based approach: 

hat is the cost of replacing Tier 1 vehicles still on the 

2022 with Tier 3 or electric vehicles? 

n for 1 0°/o of vehicle emissions >$50,000/ton 

n for last of the Tier 1 emissions was $235,000/ton 

Tier 1 vehicles replaced , vehicle emissions reduced by 40°/o 

assumed all other mobile and small sources would 

a similar cost curve, proportionately 

umes 9 tons of other source reductions for every ton of vehicle 

ction at each $/ton level 

6 
~) Use 2022 

compliance 

5) 

ols 

NOx 

(MM tons) 

__&.-3" 6.6 

(M1 (0.3) 

_;kf 6.3 

W-9} (0.8) ~, NERA ECONOMIC CONSULTING Annualized Cost (2011$, Billions) $0 $1.6 

ontrols 34 GW closures 

ntrols 

(0.2) (0.8) 

fEY.9) ( 1.0) in model) ($153) 

missions 

ns from Baseline 

alculations. 

3.7 

2.0 $ta($155+) 

eline reflects 2022 conditions in each state requiring reductions, with two 

Base Case for UT and CA reflect conditions in 2031 and 2036, 

ed on higher likely severity classifications in those two states. 

7 
Curve Used to Estimate Total Cost 

maining Reduction Needs after 

eductions 

65 ppb 

Reduction 

Need 

235 ---------------------

I 

30 

~0 

-

..... --

• • • • • • • 

······=···-------

\ ) y 

Known 

Controls 

I 

I 

I 

I 

I 

I 

I 

I 

• 

• 

I 

40°/o 

removal 

after EGU 

D 

Dll 

O NO M ICCO 

V) l 

c 

0 1 

·v; I 

Vl l 

.E ' 

W I 

X I 

0 1 

Z t I ro t 

U l 

wl 

Vl l 

ro 1 

CO t 

I 

I 

I 

I 

1 00°/o 

removal 

EPA's Cost Curve 

for Unknown Controls 

8 
0.2 0.2 

~ 

~ 

~ 

~-$ 

0~ ovC6 o~ 

,~ 

'?>-~ 

0' ~ 

~ 

~ 

~0 

00 

VJ 

0.3 -

0.3 

r~>o 

r~>o 

~0 

~0 

0~ 

~0~ 

-•

. 

NERA 

ECONOMIC CONSULTING 

• Known 

Controls 

Unknown 

Controls 

• Attainment 

Emissions 

9 
.D. 

ent 

onsulting 

com 

David Harrison, Jr., Ph.D. 

Senior Vice President 

NERA Economic Consulting 

Boston, MA. 

+1 617 927 4512 

David.Harrison@nera.com 

NERA 

ECONOMIC CONSULTING 

Insight in Economics"'