Clean Air Act: Emerging Mercury Control Technologies Have Shown Promising Results, but Data on Long-Term Performance Are Limited
Published: 2005-05-31T00:00:00

Fast Facts:

Highlights:
section_title: Why GAO Did This Study
paragraphs: In March 2005, the Environmental Protection Agency (EPA) issued a rule that will limit emissions of mercury--a toxic element that causes neurological problems--from coal-fired power plants, the nation's largest industrial source of mercury emissions. Under the rule, mercury emissions are to be reduced from a baseline of 48 tons per year to 38 tons in 2010 and to 15 tons in 2018. In the rule, EPA set the emissions target for 2010 based on the level of reductions achievable with technologies for controlling other pollutants--which also capture some mercury--because it believed emerging mercury controls had not been adequately demonstrated. EPA and the Department of Energy (DOE) coordinate research on mercury controls. In this context, GAO was asked to (1) describe the use, availability, and effectiveness of technologies to reduce mercury emissions at power plants; and (2) identify the factors that influence the cost of these technologies and report on available cost estimates. In completing our review, GAO did not independently test mercury controls. GAO provided the draft report to DOE and EPA for comment. DOE said that it generally agreed with our findings. EPA provided technical comments, which we incorporated as appropriate.
section_title: What GAO Found
paragraphs: Mercury controls have not been permanently installed at power plants because, prior to the March 2005 mercury rule, federal law had not required this industry to control mercury emissions; however, some technologies are available for purchase and have shown promising results in field tests. Overall, the most extensive tests have been conducted on technologies using sorbents--substances that bind to mercury when injected into a plant's exhaust. Tests of sorbents lasting from several hours to several months have yielded average mercury emission reductions of 30-95 percent, with results varying depending on the type of coal used and other factors, according to DOE and other stakeholders we surveyed. Further, the most recent tests have shown that the effectiveness of sorbents in removing mercury has improved over time. Nonetheless, long-term test data are limited because most tests at power plants during normal operations have lasted less than 3 months. The cost of mercury controls largely depends on several site-specific factors, such as the ability of existing air pollution controls to remove mercury. As a result, the available cost estimates vary widely. Based on modeling and data from a limited number of field tests, EPA and DOE have developed preliminary cost estimates for mercury control technologies, focusing on sorbents. For example, DOE estimated that using sorbent injection to achieve a 70-percent reduction in mercury emissions would cost a medium-sized power plant $984,000 in capital costs and $3.4 million in annual operating and maintenance costs. If this plant did not have an existing fabric filter and chose to install one--an option a plant might pursue to increase the efficiency of mercury removal and reduce related costs--capital costs would increase to about $28.3 million, while annual operating and maintenance costs would decrease to about $2.6 million. Most stakeholders generally expect costs to decrease as a market develops for the control technologies and as plants gain more experience using them. Furthermore, EPA officials said that recent tests of chemically enhanced sorbents lead the agency to believe that its earlier cost estimates likely overstated the actual cost power plants would incur.

section_title: Letter
paragraphs: Mercury, a toxic element that poses human health threats, enters the  environment through natural and human activities, such as volcanic  eruptions and fuel combustion. Coal-fired power plants release mercury  into the air when burning coal to generate electricity and were, prior to  March 2005, the largest unregulated industrial source of mercury emissions  in the United States. The Environmental Protection Agency (EPA)  estimated that in 1999, the most recent year for which data were available,  coal-fired power plants within the United States emitted 48 tons of mercury  into the air, or about 42 percent of the total man-made emissions  nationwide. The Clean Air Act Amendments of 1990 required EPA to study  the environmental and health effects of hazardous air pollutants from coal- fired power plants and determine whether it was “appropriate and  necessary” to regulate emissions of these pollutants.
In 2000, the agency determined that it was appropriate and necessary to  regulate emissions of mercury, a hazardous air pollutant, from coal-fired  power plants by requiring these plants to meet specific emissions standards  reflecting the application of control technology (the “technology-based”  approach). In January 2004, EPA issued a proposed rule with two options  for controlling mercury from power plants—the technology-based  approach and an alternative approach that would set a national cap on  mercury emissions and allow power plants flexibility either to achieve  reductions or to purchase allowances from plants that achieved excess  reductions (the “cap-and-trade” option).
In March 2005, EPA revised its finding that it was appropriate and  necessary to regulate mercury emissions from power plants under the  technology-based approach and issued a final rule based on the cap and  trade option that established a mercury cap of 38 tons for 2010 and a  second phase cap of 15 tons for 2018. Although power plants were not  previously required to control mercury emissions, some already captured  mercury as a side benefit of using controls designed to reduce other  pollutants such as sulfur dioxide. In developing the rule, EPA determined  that technologies specifically intended to capture mercury were not  adequately demonstrated and therefore were not “commercially available.”   As a result, the agency decided that it could not reasonably impose  requirements to use these technologies in the near-term and set emissions  targets for 2010 based on the level of mercury control it expects to result as  a side benefit of another rule it issued in March 2005—the Clean Air  Interstate Rule (the interstate rule)—that calls for further reductions in  emissions of nitrogen oxides and sulfur dioxide.
Controlling mercury from power plants poses unique challenges because it  is emitted in low concentrations, making removal difficult, and in several  different forms, some of which are harder to capture than others. In  addition, the relative ease of removal varies from plant to plant depending  upon such site-specific factors as the type of coal burned. EPA and the  Department of Energy (DOE) coordinate research and development of  mercury controls, with EPA conducting small-scale research on new  technologies, while DOE partners with the power industry and other  stakeholders to conduct field tests of mercury control technologies at  power plants.
The DOE field tests have focused on (1) mercury controls known as  sorbent injection technologies, in which powdered substances (known as  sorbents) that bind to mercury are injected into a plant’s exhaust; (2)  enhancements to existing controls for other pollutants to increase mercury  removal; (3) multipollutant controls, which simultaneously capture  mercury and other pollutants; and (4) oxidation technologies, which  convert mercury to a chemical form that is easier to remove. As of  February 2005, 13 of DOE’s field tests were completed and 26 were planned  or not yet completed.
In this context, you asked us to (1) describe information on the use,  availability, and effectiveness of technologies to reduce mercury emissions  at power plants; and (2) identify the factors that influence the cost of these  technologies and report on available cost estimates. To respond to these  objectives, we reviewed data about technologies specifically designed to  reduce mercury, including modifications to pollution controls already in  use that would target and improve mercury capture. We included test data  on mercury controls used in field-scale tests but did not include test data  on controls that were at earlier stages of development. We surveyed 59 key  stakeholders—including mercury control vendors, representatives of the  coal-fired power industry, technology researchers, and government  officials—and received 40 responses. In addition, we reviewed technical  documents addressing the performance of mercury controls and discussed  technology research and development with 14 key stakeholders who view  mercury reduction from a policy perspective. We did not independently test  mercury control technologies. Finally, we interviewed vendors and  researchers of mercury emissions monitoring technology to obtain and  analyze information on the availability and reliability of mercury- monitoring devices; this information is presented in appendix II. (See app. I  for a more detailed description of the scope and methodology of our  review.)  We performed our work between May 2004 and May 2005 in  accordance with generally accepted government auditing standards.
subsections: section_title: Background
paragraphs: Mercury enters the environment through natural and man-made sources,  including volcanoes, chemical manufacturing, and coal combustion, and  poses ecological threats when it enters water bodies, where small aquatic  organisms convert it into its highly toxic form—methylmercury. This form  of mercury may then migrate up the food chain as predator species  consume the smaller organisms. Through a process known as  bioaccumulation, predator species may consume and store more mercury  than they can metabolize or excrete.
Fish contaminated with methylmercury may pose health threats to people  that rely on fish as part of their diet. Mercury harms fetuses and can cause  neurological disorders in children, including poor performance on  behavioral tests, such as those measuring attention, motor and language  skills, and visual-spatial abilities (such as drawing). The Food and Drug  Administration (FDA) and EPA recommend that expectant or nursing  mothers and young children avoid eating swordfish, king mackerel, shark,  and tilefish and limit consumption of other potentially contaminated fish.  These agencies also recommend checking local advisories about  recreationally caught freshwater and saltwater fish. According to EPA, 45  states issued mercury advisories in 2003 (the most recent data available).
According to the United Nations Environment Program, global mercury  emissions are uncertain but fall within an estimated range of 4,850 to 8,267  tons per year. Of this total, EPA estimates that man-made sources in the  United States emit about 115 tons per year, with about 48 tons emitted by  power plants. Because mercury can circulate for long periods of time and  be transported thousands of miles before it gets deposited, it is difficult to  link mercury accumulation in the food chain with individual emission  sources.
The United States has 491 power plants that rely in whole or in part on coal  for electricity generation, and these plants produced 52 percent of all  electricity generated in 2004, according to DOE’s most recent data. These  plants generally operate by burning coal in a boiler to convert water into  steam, which in turn drives turbines that generate electricity. Figure 1  provides a general overview of a power plant’s layout.
Power plants burn at least one of the three primary coal ranks— bituminous, subbituminous, and lignite—and plants may burn a blend of  different coals, according to DOE. Of all coal burned by power plants in the  United States in 2004, DOE estimates that about 46 percent was  bituminous, 46 percent was subbituminous, and 8 percent was lignite.  The  amount of mercury in coal and the relative ease of its removal depend on a  number of factors, including the geographic location where it was mined  and chemical variation within and among coal ranks.
Coal combustion releases other harmful air pollutants in addition to  mercury, including sulfur dioxide and nitrogen oxides. EPA has regulated  these pollutants since 1995 and 1996, respectively, through its program  intended to control acid rain. In addition, the March 2005 interstate rule  will require further cuts in these pollutants beginning in 2009. To comply  with these and other regulations, the coal-fired power industry has  installed a variety of technologies that, while intended to control nitrogen  oxides, particulate matter, or sulfur dioxide, may also affect or enhance  mercury capture. Examples of such technologies include selective catalytic  reduction (SCR) for nitrogen oxides, electrostatic precipitators (used by  about 80 percent of all facilities) and fabric filters (used by the remaining  20 percent) to control particulate matter and wet or dry scrubbers to  remove sulfur dioxide.
EPA estimates that power plants capture about 27 tons of mercury each  year, primarily through the use of controls for other pollutants. In general,  the exhaust from coal combustion (called flue gas) exits the boiler and may  flow through a device intended to control nitrogen oxides before entering  the particle control device and then through a scrubber prior to release  from the smokestack. The combination of these devices in use at power  plants differs greatly among facilities and is likely to change as a result of  the interstate rule, which, according to EPA, will result in additional  installations of equipment to control nitrogen oxides and sulfur dioxide.   EPA believes that the steps power plants will take to control nitrogen  oxides and sulfur dioxide under the interstate rule will enable them to meet  the first phase mercury cap of 38 tons beginning in 2010. As noted above,  EPA determined that mercury control technologies were not commercially  available and that the agency could not reasonably impose requirements to  use them in the near-term.
Nonetheless, a number of mercury control technologies have been  developed over the past several years as a result of public and private  investments in research and development, and these technologies generally  fall into the following categories:  Sorbent (carbon-based, chemically enhanced carbon-based, and  non-carbon based). This technology involves injecting a powdered  substance (sorbent) into the flue gas that binds to mercury prior to  collection in a particle control device. Regardless of the chemical  composition of the sorbent, this technology involves adding a silo or  other structure containing the sorbent and a system that injects the  sorbent into ducts that carry the flue gas.
Enhancements to existing controls for other pollutants to  increase mercury capture. This class of technologies focuses on  retrofitting existing controls for other pollutants to improve their ability  to capture mercury.  Examples of enhancements include adding  sorbents to wet scrubbers used for sulfur dioxide removal or modifying  selective catalytic reduction devices used to reduce nitrogen oxides.
Multipollutant controls. This class of technologies is designed from  the outset to simultaneously control or enhance the removal of multiple  pollutants, such as mercury, nitrogen oxides, or sulfur dioxide. These  technologies may also use sorbents.
Oxidation technologies. This class includes methods, chemicals, or  equipment designed to oxidize mercury into a form that is more readily  captured.
Other technologies. This category includes other technologies that  capture mercury using approaches such as removing mercury from coal  prior to combustion and fixed adsorption devices that rely on precious  metals such as gold to separate mercury from flue gas.
The intended location of these technologies in a power plant’s overall  layout may vary. As shown in figure 2, some may be located between the  boiler and the particulate matter collection device, while others may be  located further downstream in a plant’s process. This figure also shows that  some plants can either install sorbent injection upstream of the existing  particulate matter removal device or downstream of the device using a  supplemental filter to collect the spent sorbent, keeping it separate from  the fly ash collected in the particulate matter collection device. The latter  configuration may be relevant for those facilities that sell their fly ash as a  raw material for use in other applications, such as cement manufacturing,  because carbon-based sorbent can render fly ash unsuitable for some of  these applications. According to EPA, power plants sell about 35 percent of  their fly ash for use in other applications, with 15 percent going to uses,  such as cement manufacturing, where carbon contamination could pose a  problem.
The Department of Energy’s (DOE) National Energy Technology  Laboratory partners with the private sector to evaluate the use of mercury  control technologies at power plants in tests lasting up to 5 months. The  testing program focuses on mercury controls, such as sorbent injection,  and ways to better and more consistently capture mercury with  technologies for other pollutants. Participants in DOE’s program evaluate  concepts in laboratories and develop promising technologies in  progressively larger-scale applications, including actual power plants.   The duration of the tests that have been completed has varied from several  hours to 5 months, with most of the completed DOE-funded tests lasting  between 1 week and several months. The most recent phase of DOE  testing has focused on the longer-term performance of mercury control  technologies. Appendix III provides more information on the DOE tests  completed, ongoing, or planned as of February 2005.
section_title: Mercury Controls Have Not Been Permanently Installed at Power Plants but Are Available for Purchase and Have Shown Promising Results in Field Tests
paragraphs: Power plants in the United States do not currently use mercury controls,  but some technologies are available for purchase and have shown  promising results in full-scale tests in power plants. These tests have  shown that mercury controls known as sorbent technologies—which  involve injection of a powdered material that binds to mercury in the  plant’s exhaust—have shown the greatest effectiveness in removing  mercury during tests at power plants. However, long-term test data are  limited because most of these tests have lasted less than 3 months.
subsections: section_title: Mercury Controls Are Not Currently Used by Power Plants, but Some Technologies Are Available for Purchase
paragraphs: According to all 40 survey respondents, coal-fired power plants were not,  as of November 2004, using mercury controls, although several plants have  subsequently announced plans to install them. The coal-fired power  industry has not used mercury controls because, prior to EPA’s March 2005  rule, federal law had not required mercury emissions reductions at power  plants. In fact, most of the power industry survey respondents (13 of 14)  cited uncertainty about future regulations as one of the top three reasons  for not installing mercury controls. Thus, in the absence of federal  requirements to reduce mercury emissions, limited demand existed for  mercury controls.
We found that although some mercury controls, such as activated carbon  injection, are currently available for purchase from vendors, perceptions  about their availability vary widely among stakeholders, primarily because  stakeholders do not consistently define “availability.”  That is, some  stakeholders believe that mercury controls become available when they  have been demonstrated in long-term tests under normal commercial  operations, rather than when they are available for purchase. Thus, some  stakeholders’ views on availability reflect more of a judgment about the  proven effectiveness of a control technology than their availability for  purchase. In this context, we found that views regarding the availability of  mercury controls generally varied by stakeholder group and by the type of  control. A greater portion of the vendors described mercury controls as  available than either of the other two groups we surveyed, with the power  industry group citing these controls as available least frequently. As shown  in figure 3, the stakeholders were overall most optimistic about the  availability of activated carbon injection technologies, followed by  multipollutant controls and enhancements to existing controls for other  pollutants.
Appendix IV provides more detailed information on stakeholder  perceptions of the availability of mercury controls.
In evaluating the availability of mercury controls prior to finalizing the  March 2005 mercury rule, EPA found that mercury controls were available  for purchase but concluded that they had not been sufficiently  demonstrated in long-term tests, and therefore were not available for  permanent installation at power plants before 2010. As a result, EPA set the  2010 mercury reduction targets at a level that power plants could achieve  as a side benefit of using technologies for other pollutants that the agency  expects many plants will install to comply with the interstate rule, and set  more stringent limits for 2018. Thus, power plants will not need to install  mercury-specific controls until well after 2010.  According to an EPA white  paper assessing test results as of February 2005, the agency expects that  mercury control technologies will be available for commercial application  on most, if not all, key combinations of coal type and control technology to provide mercury removal levels between 60 and 90 percent after 2010 and  between 90 and 95 percent in the 2010-2015 time frame.
section_title: Some Mercury Controls Have Shown Promising Results in Short-Term Field Tests, but Data on Long- Term Performance Are Limited
paragraphs: Because mercury controls have not been permanently installed at power  plants, the data on the performance of these technologies come from field  tests. We obtained data from 29 completed field tests, including 13 which  were part of DOE’s mercury control research and development program,  and 16 other tests identified by survey respondents. Most of the available  test data (21 of 29 tests) related to the effectiveness of sorbents. According  to DOE and EPA, the tests have shown promising results, although the  extent of mercury removal varies at each plant.
Tests of varying duration have identified sorbent technologies as the most  developed mercury controls, which show promising results in achieving  high mercury reductions. For example, tests of activated carbon and  chemically enhanced carbon-based sorbents at power plants using a variety  of air pollution controls have shown average reductions of 30 to 95 percent  overall, providing the following average mercury reductions for each coal  type: 70-95 percent average removal on bituminous coals;  30-90 percent average removal on subbituminous coals;  63-70 percent average removal on lignite coals; and 94 percent removal on blends of bituminous/subbituminous coals.
As the scale and duration of testing has increased, researchers have gained  a better understanding of site-specific variables that affect results, and  more recent full-scale, monthlong tests, particularly those using chemically  enhanced carbon-based sorbents, have shown sustained high removal  rates. For example, a monthlong test conducted in 2004 showed that a  chemically enhanced sorbent reduced mercury emissions from a primarily  subbituminous blend of coal by 94 percent, and a monthlong test of another  chemically enhanced sorbent at a different plant burning subbituminous  coal achieved a 93 percent reduction.
A number of the stakeholders we surveyed pointed out that the results of a  particular test cannot be generalized or extrapolated to estimate potential  reductions at other power plants because the reductions achieved during a  test may have resulted in part from factors unique to that facility, such as  its size, the type of boiler used, the temperature of its flue gas, or the  combination of controls for other pollutants. For example, available data  show that the extent of mercury reduction achieved by sorbent injection at  facilities using electrostatic precipitators depends largely on the location of  these devices at the plant. The location of an electrostatic precipitator in  turn affects the temperatures of the flue gas entering the device, with more  mercury captured at cooler temperatures. Thus, the results achieved at a  particular plant may not serve as a reliable indicator of the performance of  that control at all plants.
DOE’s research and development program has funded tests of mercury  controls on each coal type in light of its and EPA’s conclusions that the  form of mercury emitted—which varies by coal type—and other chemical  variations among coal types, such as chlorine content, can have an impact  on a control’s removal effectiveness. For example, lower removal rates in  activated carbon injection tests have occurred primarily at plants burning  low rank coal or at plants with existing controls that are less conducive to  mercury removal. One university-based researcher attributes the challenge  of mercury reductions on lignite—a low rank coal—to its chemical  composition, but believes that chemically enhanced sorbents and special  additives can improve the ability of the sorbent to bind to this form of  mercury, thereby addressing this problem. The more recent mercury  removal results we reviewed tended to support this view as monthlong  tests using chemically enhanced carbon-based sorbents achieved average  reductions of 70 percent or greater on low-rank coals, including lignites,  suggesting that this technology may achieve high-level mercury reductions  from low-rank coals (See app. III for more information on these results).
Since most of the field tests have focused on sorbent injection, fewer data  are available on the performance of non-sorbent mercury controls, such as  multipollutant controls, enhancements to existing controls, and mercury  oxidation technologies. Results from 11 of the 19 tests of such controls  were not yet available (9 of the tests were not planned to begin until after  February 2005). The few available results show that average mercury  removal achieved by multipollutant controls and enhancements has ranged  from about 50 percent to 90 percent. The field tests of mercury oxidation  technologies, multipollutant controls, enhancements and other non- sorbent technologies, lasting several days to several months, have included  all coal types, but most (7 of 10) to date have focused on bituminous coal.  In addition, a future DOE project will fund a test of a multipollutant control  on a plant burning subbituminous coal and three tests of mercury controls,  including mercury oxidation and enhancements, on plants burning lignite  coal.
section_title: Stakeholders Generally Agree That Sorbent Injection Is the Most Promising Control and That Some Additional Tests Are Needed
paragraphs: As noted above, EPA determined as part of its March 2005 mercury rule  that it could not reasonably impose requirements that would force the use  of mercury-specific controls before 2010. Specifically, EPA believes that  chemically enhanced carbon-based sorbents could reduce mercury  emissions at a broad spectrum of plants but regards long-term testing as  necessary in order to evaluate (1) the mercury removal performance of  technologies when operated continuously for more than several months at  a time; and (2) the impact that these controls have on a plant’s overall  efficiency and operations. Furthermore, DOE officials have said that while  sorbent injection holds much promise, it is unwise to depend solely on one  approach for mercury control in part because the site-specific variables at  each power plant affects the performance of mercury controls. DOE has  concluded that it will be necessary to build a broad portfolio of mercury  control options.
Likewise, technical papers and presentations about the field tests by  research and development participants express a high degree of confidence  in the capability of sorbents, particularly chemically enhanced carbon- based sorbents, but also suggest the need for additional evaluation of the  impact of these controls, if any, on the efficiency and reliability of power  plants. For example, a paper written by a sorbent vendor conducting DOE- funded tests concluded that recent monthlong tests of chemically  enhanced carbon-based sorbent injection have shown high mercury  removal at plants that burn subbituminous coals, but also discussed  concerns about the long-term use of this control on a power plant’s  operations. This vendor concluded that although these tests did not show  any adverse effects resulting from the chemically enhanced carbon-based  sorbent, concerns and issues surrounding the contamination of fly ash that  can render it unsuitable for sale for certain applications have not yet been  resolved.  With regard to potential adverse impacts at plants, no serious  adverse effects have been associated with sorbent injection tests lasting up  to 1 month in duration, according to EPA.
To provide additional perspective on the expected long-term performance  of mercury controls, we asked survey respondents to indicate whether they  believed power plants could use mercury controls to achieve industrywide  mercury reductions of 50, 70, or 90 percent by 2008. We also asked the  respondents whether their perceptions would differ if the reductions were  averaged across the industry (as in an emissions trading program) or if they  were required at each plant. We found that many survey respondents (22 of  the 38 answering this question) were confident in the ability of power  plants to achieve a 50 percent reduction by 2008 regardless of whether the  reductions were achieved at each plant or averaged across the industry.   EPA set the mercury emissions cap for 2010 based on a 50 percent  reduction from the 75 tons in coal.
The stakeholders were progressively less confident in the ability of plants  to achieve 70 and 90 percent reductions by 2008. For the 70 percent  reduction scenario, stakeholders were more confident in the ability of  plants to achieve this reduction averaged across the industry rather than at  each plant; 16 stakeholders described themselves as confident or very  confident in the ability of plants to achieve this level of reduction  nationwide, while 21 described themselves as less confident or not at all  confident. For the 90 percent scenario, the vast majority of the survey  respondents (33 of 38 that answered this question) described themselves as  not at all confident or less confident in the ability of plants to achieve this  level of reduction nationwide by 2008. Appendix V summarizes the survey  responses for each of the three scenarios.
Furthermore, we asked the 40 survey respondents to identify additional  testing needed to assess the ability of mercury control technologies to  effectively and reliably reduce mercury emissions by 70 percent. Most of  the survey responses (40 of 45) showed that stakeholders believe that  some additional testing is needed for at least one technology.  For example,  the 14 power industry respondents said that additional testing is needed for  sorbent injection. In addition, 3 of the 4 carbon-based sorbent vendors  answering this question as well as 9 of the 12 researchers and government  officials believed that some additional testing is needed to show that  carbon-based sorbent injection would reliably and effectively achieve  mercury reductions of 70 percent.
Three policy stakeholders representing the power industry believed that  more tests are needed to evaluate factors such as the performance of  controls on low-rank coals, the impact on small power plants, and the  ability of plants to use mercury controls without compromising electricity  generation. Several of the power industry respondents expressed concern  about the potential for mercury controls to interfere with a plant’s overall  efficiency or cause malfunctions, and a power industry representative  pointed out that such disruptions are a concern because power plants  cannot store electricity for use as a backup when they experience technical  problems. Information from ongoing and planned long-term tests will  provide important information on both the long-term performance of  mercury controls and the effect, if any, that these controls have on the  efficiency or reliability of power plants.
In addition, several plants have recently announced plans to install  mercury controls to comply with either state permit requirements or the  terms of legal settlements. For example, a power plant in New Mexico  announced in March 2005 that it would install sorbent injection within the  next 2 years to reduce mercury emissions as part of a settlement agreement  with two environmental groups. A plant representative stated that while he  believes sorbent technology “is not that advanced … it is advanced enough  to use it to reduce mercury emissions” at the power plant. Another power  plant currently under construction in Iowa has a state air pollution permit  requiring the company to control mercury emissions and is installing  sorbent injection technology. The company expects to reduce mercury  emissions from subbituminous coal by 83 percent. Finally, under an  agreement with the state of Wisconsin, a Michigan power plant owned by a  Wisconsin-based company has begun to install a multipollutant control that  will use sorbent injection to reduce mercury and other pollutants.
section_title: Mercury Control Costs Depend on a Variety of Factors, and Current Estimates Vary Widely
paragraphs: The estimated costs to install and operate mercury controls vary greatly  and depend on a number of site-specific factors, including the amount of  sorbent used (if any), the ability of existing air pollution controls to remove  mercury, and the type of coal burned. EPA and DOE have developed the  most comprehensive estimates available for mercury controls based on  modeling and data from a limited number of field tests, making them both  preliminary and uncertain. These estimates, as well as other available  estimates, focus on sorbent injection, the most developed mercury control  technology. Estimated costs for sorbent injection vary greatly depending on  whether facilities achieve mercury reduction targets by using this  technology in combination with their existing air pollution control devices  or instead add fabric filters to collect the spent sorbent. Regardless of the  exact costs of the controls, most of the stakeholders we contacted  generally expect the costs to decrease over time.
subsections: section_title: Cost Estimates Depend on Several Site-Specific Factors
paragraphs: The available cost estimates are projections based on a limited number of  tests, primarily of activated carbon injection. The cost estimates we  reviewed show that the total costs of installing and operating mercury  controls vary depending on factors such as sorbent consumption, the  ability of existing air pollution controls to remove mercury, and the type of  coal burned. We discuss each of these factors in more detail below:    Sorbent consumption:  The amount of sorbent that a facility needs to  use greatly influences control cost estimates. According to DOE,  sorbent consumption levels for activated carbon injection technology  directly relate to the desired level of mercury control. Further, while  increasing the amount of carbon injected increases mercury removal,  the performance of the carbon eventually levels off, requiring  increasingly greater amounts of carbon to achieve an incremental  mercury reduction. For example, test data from a plant burning  subbituminous coal show that more than twice as much sorbent would  be needed to remove 60 percent of the mercury from the plant’s flue gas  than to remove 50 percent. Therefore, the cost of the activated carbon  can increase dramatically, depending on the desired level of mercury  removal and the type of coal burned.
Other air pollution controls already installed:  The air pollution  controls already installed at a facility—especially fabric filters and  electrostatic precipitators used for controlling particulate matter—can  have a major effect on the cost of controlling mercury because some of  these devices already remove varying amounts of mercury. For example,  DOE’s tests have shown that fabric filters generally remove more  mercury than electrostatic precipitators. Thus, facilities with fabric  filters may already remove enough mercury to achieve a desired or  required level of reduction. However, plants that do not have an existing  fabric filter and choose to install one may incur significant costs due to  their high capital expense. Additionally, EPA believes that controls for  other pollutants some plants will install to comply with the interstate  rule—such as selective catalytic reduction to control nitrogen oxides  and wet scrubbers to control sulfur dioxide—will result in further  mercury capture. Therefore, the combination of other air pollution  controls may reduce or in some cases eliminate the need for a plant to  install mercury-specific controls to reduce its mercury emissions. As  noted above, EPA based its mercury reduction goals for 2010 to 2018 on  the level of control it expects plants will achieve with controls for these  other pollutants.
Type of coal burned:  According to EPA, the amount of mercury  captured by a given control technology is generally higher for plants  burning bituminous coals than for those burning subbituminous coals.  This difference arises because the flue gas from bituminous coal  contains higher levels of substances that facilitate mercury capture.  Along these lines, DOE’s cost estimates assume that an electrostatic  precipitator will capture 36 percent of mercury from plants that burn  bituminous coal, but none of the mercury from plants that burn  subbituminous coal. Thus, DOE estimated that mercury removal costs  are higher for subbituminous-fired plants than bituminous-fired plants.
section_title: Available Mercury Control Cost Estimates Are Preliminary and Vary Greatly
paragraphs: Most of the available cost estimates for mercury control focus on sorbent  injection, the most developed technology. DOE and EPA have developed  comprehensive cost estimates; however, they are preliminary and, in EPA’s  case, based on model plants rather than actual power plants. Further, while  DOE developed its estimates from tests in power plants, the agency  indicated that its mercury control costs may be off by as much as 30  percent in either direction because (1) the estimates were developed from  a limited data set of relatively short-term tests and thus are highly  uncertain, and (2) they are based on a number of assumptions that, if  changed, would result in significantly different estimates. According to  DOE, further testing of sorbent injection for a variety of coals is needed to  accurately assess the costs of implementing the technology throughout the  United States. In addition, EPA’s and DOE’s cost estimates were published  in October and November 2003, respectively, and do not reflect the more  recent test data. For example, more recent field tests with chemically  enhanced sorbents have shown that these sorbents may be more efficient  at removing mercury than the sorbents used in earlier tests. Thus,  chemically enhanced sorbents may achieve a high level of mercury removal  using less sorbent and without the high capital cost of installing a fabric  filter. DOE expects to issue revised cost estimates which will reflect lower  costs based on recent testing. As a result, the available cost estimates may  not accurately reflect the costs that power plants would incur if they chose  to install mercury controls.
In addition, the two agencies’ cost estimates relied on different  assumptions and are not directly comparable. Most notably, the two  agencies based their cost estimates on plants of different size and made  varying assumptions about the percentage of time that an average plant  operates (called capacity factor). For example, EPA conducted its  modeling for 100- and 975-megawatt plants, while DOE based its estimates on a 500-megawatt plant. As a result, EPA provided a wider range of cost  estimates. Furthermore, EPA assumed a plant capacity factor of 65 percent,  while DOE assumed an 80 percent capacity factor, which resulted in higher  operating costs in the DOE estimates. Additionally, based on available  data for plants with an existing electrostatic precipitator that burn  bituminous coal, EPA’s modeling predicted the existing control equipment  would achieve a 50 percent mercury removal without sorbent injection,  while DOE assumed that this configuration would remove no more than 36  percent of mercury and that sorbent injection was needed even for  achieving 50 percent mercury removal.
Although the DOE and EPA estimates reflect different assumptions as  discussed above, we are providing the two agencies’ cost estimates for  achieving a 70 percent mercury reduction at a bituminous-fired coal power  plant under two scenarios (using an existing electrostatic precipitator and  installing a supplemental fabric filter) to provide a perspective on the costs  power plants could incur to install sorbent injection technologies.
For a 100-megawatt plant using an existing electrostatic precipitator,  EPA estimated that capital costs would total $527,100 ($5.27 per  kilowatt, 2003 dollars), and the operating and maintenance costs would  total $531,820 annually for a plant operating at 65 percent capacity  ($0.93 per megawatt-hour). Alternatively, if this plant were to install a  supplemental fabric filter, the capital costs would increase to about $5.8  million ($57.73 per kilowatt) and the operating and maintenance costs  would decrease to $171,959 annually ($0.30 per megawatt-hour).
For a 500-megawatt plant using an existing electrostatic precipitator,  DOE estimated the capital costs would total $984,000 ($1.97 per  kilowatt), and the annual operating and maintenance costs would total  about $3.4 million ($0.97 per megawatt-hour) for a plant operating at 80  percent capacity (2003 dollars). Alternatively, if this plant were to install  a supplemental fabric filter, the capital costs would increase to about  $28.3 million ($56.53 per kilowatt), and the operating and maintenance  costs would decrease to about $2.6 million annually ($0.74 per  megawatt-hour).
For a 975-megawatt plant using an electrostatic precipitator, EPA  estimated that capital costs would total about $2.4 million ($2.47 per  kilowatt), and the operating and maintenance costs would be about $5.1  million annually for a plant operating at 65 percent capacity ($0.92 per  megawatt-hour). Alternatively, if this plant were to install a  supplemental fabric filter, the capital costs would increase to about  $35.4 million ($36.32 per kilowatt), and the operating and maintenance  costs would decrease to about $1.6 million annually ($0.30 per  megawatt-hour).
These data show that DOE estimated lower capital costs per unit of power  generating capacity than EPA, while EPA estimated slightly lower  operating and maintenance costs than DOE. This may result from the fact  that EPA assumed higher rates of mercury removal with existing controls  than DOE, as well as DOE’s use of a higher plant capacity factor than EPA.  Appendix VI provides additional information on EPA’s and DOE’s cost  estimates for sorbent injection control technologies.
According to EPA, the costs of sorbent injection technologies to control  mercury emissions are very small compared to other air pollution control  equipment when other retrofits, such as the addition of fabric filters, are  not required. EPA also reports that the fixed operating costs for these  systems are also relatively low, stemming from the simplicity of the  equipment. In EPA’s rulemaking documents, the agency said that in light of  the more recent tests of chemically enhanced sorbents, their earlier  estimates likely overstated the actual costs power plants would incur. DOE  officials said they shared this view.
EPA also estimated costs for multipollutant controls, including advanced  dry scrubbers. Although these controls cost substantially more than  sorbent injection, they would provide additional benefits by controlling  other types of pollutants such as nitrogen oxides and sulfur dioxide.  EPA  regarded cost information for multipollutant controls as preliminary,  because there had been limited commercial experience with these  technologies in the United States. In part because the agency estimated a  range of capital and operating costs for each scenario, EPA’s estimates of  the cost of these technologies varied widely. For example, for advanced  dry scrubbers, EPA estimated the capital costs as $115.46 to $243.08 per  kilowatt, with costs per kilowatt generally higher for smaller plants.  For  100-megawatt and 975-megwatt plants, capital costs could be as low as  $16.2 million and as high as $168.7 million respectively. EPA estimated  operating and maintenance costs for a 100-megawatt plant to be between  $1.1 million and $1.3 million per year, assuming a plant capacity factor of 65  percent (or between $1.93 and $2.35 per megawatt-hour). For a 975- megawatt plant, operating and maintenance costs were estimated to be  between $9.3 million and $37.5 million per year, assuming a plant capacity  factor of 65 percent (or between $1.68 to $6.76 per megawatt-hour).
In addition to the cost estimates from EPA and DOE, we surveyed  technology vendors, representatives of coal-fired power plants, and  researchers about the cost of these technologies. Seventeen of these  stakeholders provided sorbent injection cost information, but these  estimates were incomplete and not always comparable due to site-specific  variations and differing assumptions. The vendors generally provided  lower cost estimates than those provided by the power industry, while  estimates provided by researchers had the broadest range.
EPA and DOE officials and other stakeholders identified relevant cost  estimates compiled by other nongovernmental entities:    Charles River Associates, an economics and business consulting firm,  provided cost estimates for activated carbon sorbent injection in  combination with an existing or supplemental fabric filter.  Rather than  presenting estimates of costs for particular plant sizes and mercury  removal percentages, Charles River Associates provided formulas with  variables for mercury removal and plant size. Using these formulas and  a plant size of 500 megawatts, Charles River Associates’ analysis would  generate estimates of total capital costs of about $749,278 for using  sorbent injection with an existing fabric filter and about $20.6 million for  sorbent injection and a supplemental fabric filter (1999 dollars).  Operating and maintenance costs comprise a fixed cost based on plant  size and a variable component that could be calculated for a range of  mercury removal percentages. For example, a 90 percent mercury  reduction using sorbent injection with an existing fabric filter for a  bituminous coal-fired 500-megawatt plant operating at 80 percent  capacity over the course of a year (7,008 hours) would cost $999,473 per  year, or about $0.29 per megawatt-hour. A 90 percent reduction at the  same size plant burning subbituminous coal would cost $1.3 million per  year or about $0.38 per megawatt-hour. Annual operating and  maintenance costs were about $75,000 higher for the configuration  where a supplemental fabric filter was installed.
In its modeling, Charles River Associates considered only sorbent  injection technology with an existing or retrofitted fabric filter because  the firm expects that this combination would have a lower cost per  pound of mercury removed than sorbent injection alone. Charles River  Associates’ operating and maintenance cost estimates for activated  carbon injection alone are lower than the EPA and DOE estimates;  however, the Charles River estimates reflect the assumption that plants  already had a fabric filter, while EPA and DOE assumed plants already  had an electrostatic precipitator.
MJ Bradley & Associates, an engineering and environmental consulting  firm, summarized costs for other multipollutant controls that have  undergone full-scale testing. One technology, which uses ozone to  oxidize nitrogen oxide and mercury, has been estimated to remove over  90 percent of nitrogen oxide and mercury from a plant’s flue gas; it also  controls sulfur dioxide. This technology is estimated to cost between  $90 and $120 per kilowatt in capital costs and $1.7 to $2.37 per  megawatt-hour in annual operating and maintenance costs. For a 500- megawatt plant operating at 80 percent capacity, this would equate to  $45 million to $60 million in capital costs and $6.0 million to $8.3 million  in annual operating and maintenance costs.  MJ Bradley also estimated  the costs of a system that removes sulfur dioxide and mercury and  decomposes nitrogen oxide through a multi-stage oxidation, chemical,  and filter process. The target mercury removal rate for this process is 85  to 98 percent, which MJ Bradley reports the manufacturer guarantees.  The estimated capital cost of this process is between $110 and $140 per  kilowatt, or $55 million to $70 million for a 500-megawatt plant. A  downstream fabric filter is associated with this process to remove  particulate matter, which could add an additional cost.
In considering the cost estimates, it is important to note that plants may  identify and choose the most cost-effective option for complying with EPA’s  mercury rule. The cost-effectiveness of a given mercury control will vary by  facility, depending on site-specific factors, including the type and  configuration of controls already installed. Furthermore, the desired level  of mercury control at a plant will affect its control costs and some plants  may meet their mercury reduction goals by modifying existing air pollution  control equipment, thereby negating the need for additional mercury  controls. In cases where plants decide to install mercury controls, the  desired control level will affect the cost-effectiveness of the various  technologies. For example, sorbent injection with a downstream fabric  filter may prove cost effective for facilities seeking a high level of  reduction, but less cost effective for plants seeking lower level reductions  because of the relatively high capital costs.  In the example given above for  a 70 percent mercury reduction at plants burning bituminous coal, based  on annualized costs, EPA’s estimates suggest it is more cost-effective for  both the 100- and 975-megawatt plants to achieve that reduction without  installing a supplemental fabric filter; however, DOE’s estimates suggest it  is more cost-effective for the 500-megawatt plant to install the  supplemental filter when accounting for the loss of revenue and increased  disposal costs plants could incur from not being able to sell their fly ash.
Fly ash disposal plays a role in determining the most cost effective  compliance option because the plants that sell their fly ash and choose to  use carbon-based sorbents may lose revenue and face increased disposal  costs if they can no longer sell their fly ash. According to EPA, power  plants sell about 35 percent of their fly ash for use in other applications,  with 15 percent going to uses, such as cement manufacturing, where  carbon contamination could pose a problem. The presence of carbon-based  sorbent in fly ash may render it unusable for such purposes, particularly as  a cement substitute in making concrete. Therefore, in some cases, plants  using carbon-based sorbent may not be able to sell their fly ash and instead  have to pay for its disposal. Plants may mitigate this problem by installing  sorbent injection downstream of the electrostatic precipitator. This would,  however, require the plants to install a fabric filter to collect the spent  sorbent. DOE estimated that this configuration may be a cost-effective  method to achieve mercury reductions for plants that wish to continue  selling their fly ash, but the high capital costs of installing a fabric filter may  render this choice uneconomic for some facilities. However, based on more  recent tests, EPA believes that chemically enhanced sorbents can be more  efficient at achieving a high level of mercury removal and may not render  fly ash unusable for other purposes. Therefore, the use of these sorbents  might prevent a plant from having to install a fabric filter and allow them to  continue selling fly ash.
section_title: Most Stakeholders Expect the Costs to Decrease over Time
paragraphs: Regardless of the exact magnitude of costs, 22 of the 40 survey  respondents, all of the 14 policy stakeholders we interviewed, EPA, and  DOE expect mercury control costs to decrease over time. Stakeholders  cited a number of reasons for this belief, including the presence of a  mercury rule, the expected development of a market that would lead to  competition and increased demand for technologies, and anticipated  improvements in technology performance as a result of innovation and  experience. According to EPA and DOE officials, the most recent test  results of injected sorbent technologies suggest that the cost of using these  technologies will be less than these agencies estimated in 2003, stemming  from advances in the sorbents. Likewise, EPA’s economic impact analysis  of the mercury rule reports that the actual cost of mercury control may be  lower than currently projected, since the rule may lead to further  development and innovation of these technologies, which would likely  lower their cost over time.
In addition to the views of these stakeholders, experience with pollution  control requirements under other air quality regulations also suggests that  costs may decrease over time. While factors affecting the cost of mercury  control technology may or may not be analogous to that of technologies to  control other regulated pollutants, an examination of the cost trends for  other air pollution controls shows that costs have declined over time. For  example, according to EPA, the acid rain sulfur dioxide trading program  was shown in recent estimates to cost as much as 83 percent less than  originally projected. Furthermore, studies conducted by other  researchers demonstrate that costs of air pollution control technologies  have declined. For example, research conducted by Carnegie Mellon  University found that the capital cost of sulfur dioxide control technology  for a coal-fired power plant decreased from approximately $250 to $130 per  kilowatt of electricity generating capacity between 1976 and 1995 (1997  dollars). Similarly, case studies analyzed by the Northeast States for  Coordinated Air Use Management (NESCAUM) found the total operating  and maintenance costs of sulfur dioxide controls decreased about 80  percent between 1982 and 1997. NESCAUM also found a reduction in the  capital cost of nitrogen oxide controls, which it attributed to improvements  in operational efficiency.
section_title: Concluding Observations
paragraphs: Because data on the performance of mercury controls stem from a limited  number of tests rather than permanent installations at power plants, data  on the long-term performance of these technologies are limited.  Furthermore, while the available data show promising results, forecasting  when power plants could rely on these technologies to achieve significant  mercury reductions—such as by 2008 or later—involves professional  judgment. The judgment of the stakeholders we contacted varied  substantially, with control vendors and some researchers expressing  optimism about the potential for sorbent technologies to achieve  substantial mercury reductions in the near term, while power industry  stakeholders, DOE, and EPA highlighted the need for more long-term tests.  Current and future DOE tests will enhance knowledge about these  controls, especially on their effectiveness in removing mercury and the  potential impacts they may have on plant operations. In addition,  information from the power plants that plan to install mercury controls as  part of settlement agreements or to meet state-level requirements could  shed additional light on these issues.
A number of factors complicate efforts to estimate the costs of installing  mercury controls. For example, available data suggest that site-specific  variables will dictate the level of expense that power plant owners and  operators will incur should they install one of the available mercury control  technologies. While even the current cost estimates for the most advanced  of the technologies—sorbent injection—are highly uncertain for individual  plants, many of the stakeholders we contacted expect these costs to  decline. Further, past experience with other air pollution control  regulations suggests that the costs of pollution controls decline over time  due to technological improvements, the development of a market, and  increased experience using the controls.
Recent data already show a similar trend with respect to mercury controls.  For example, EPA and DOE have stated that advanced sorbent  technologies have the potential to achieve greater mercury removal at  lower cost than previously estimated. Also, the emissions trading program  established under EPA’s mercury rule gives industry flexibility in  determining how it will comply with the control targets, enabling plants to  choose the most cost-effective compliance option, such as installing  controls, switching fuels, or purchasing emissions allowances. Finally,  because the power industry must also further reduce its emissions of  nitrogen oxide and sulfur dioxide to comply with the interstate rule, the  power industry has the opportunity to cost-effectively address emissions of  all three pollutants simultaneously.
section_title: Agency Comments
paragraphs: We provided a draft of this report to DOE and EPA for review and  comment. DOE reviewed the report and said that it generally agreed with  our findings. EPA’s Office of Air and Radiation and Office of Research and  Development provided technical comments, which we incorporated as  appropriate.
As agreed with your offices, unless you publicly announce the contents of  this letter earlier, we plan no further distribution until 15 days from the  report date. At that time, we will send copies of the report to the EPA  Administrator, DOE Secretary, and other interested parties. We will also  make copies available to others upon request. In addition, the report will be  available at no charge on the GAO Web site at http://www.gao.gov.
If you have any questions about this report, please contact me at (202) 512- 3841 or stephensonj@gao.gov. Contact points for our Offices of  Congressional Relations and Public Affairs may be found on the last page  of this report. GAO staff who made major contributions to this report are  listed in appendix VII.
section_title: Objectives, Scope, and Methodology
paragraphs: Congressional requesters asked us to (1) describe the use, availability, and  effectiveness of technologies to reduce mercury emissions at power plants;  and (2) identify the factors that influence the cost of these technologies and  report on available cost estimates. To respond to these objectives, we  surveyed a nonprobability sample of 59 key stakeholders in three groups,  including 22 mercury control technology vendors, 21 representatives of the  coal-fired power industry, and 16 individual researchers and/or government  officials. We supplemented and corroborated, to the extent possible, the  survey information through structured interviews with 14 stakeholders  who view the reduction of mercury emissions from a policy perspective,  including senior staff at EPA’s Office of Policy Analysis and Review and  DOE’s Office of Fossil Energy. Finally, we interviewed vendors and  researchers of mercury emissions monitoring technology to obtain and  analyze information on the availability and reliability of mercury  monitoring devices.
Our work dealt with (1) technologies or measures that are specifically  intended to control mercury emissions and (2) modifications to existing  controls for other pollutants (e.g., nitrogen oxides, particulate matter, or  sulfur dioxide) that are specifically intended to enhance mercury removal.  We did not assess the availability, use, cost, or effectiveness of controls for  other pollutants that capture mercury as a side-benefit because EPA had  already conducted an extensive analysis of that topic as part of the rule  development process. As a result, our work addressed only technologies  specifically intended to control mercury. We did not independently test  these technologies. Lastly, we focused on technologies that had advanced  to the field-test stage rather than on technologies in earlier stages of  testing. Most of the test data we reviewed were from full-scale tests, but the  field tests of less developed controls, such as some multipollutant controls,  were not full-scale. In these cases, the data were obtained from slipstream  tests at power plants, where segments, rather than the entire stream, of the  flue gas were diverted for testing.
We relied primarily on surveys to obtain current data and professional  judgment on the status of mercury controls. We developed three different  surveys, one for each stakeholder group, which requested information  about the availability, use, effectiveness, and cost of mercury control  technologies. The scope and nature of some questions varied between the  three surveys in order to reflect the varying expertise of each stakeholder  group. To the extent possible, we structured the questions to facilitate  comparisons between the responses of each stakeholder group. We used  this format because we expected researchers, government officials, and  power industry respondents to possess broad knowledge about a portfolio  of mercury controls while technology vendors would have extensive  information about a limited number of controls, or those that they produce,  develop or sell. The most significant difference between the three surveys  was that we asked technology vendors to answer questions only about the  control produced, developed, or sold by each vendor, whereas the  questions for researchers, government officials, and power industry  respondents were not limited to one mercury control.
We developed the three surveys with survey specialists between July 2004  and October 2004. We took steps in the design, data collection, and analysis  phases of the work to minimize nonsampling and data processing errors.  We conducted pretests of the surveys, and staff involved in the evaluation  and development of mercury control technologies within EPA’s Office of  Research and Development and DOE’s Office of Fossil Energy also  reviewed and commented on the three surveys. We made changes to the  content and format of the final surveys based on the pretests, comments of  EPA and DOE officials, and comments of our internal reviewer. We  followed up with those that did not respond promptly to our surveys. We  also independently verified the entry of all survey responses entered into  an analysis database as well as all formulas used in the analyses.
We mailed paper copies of the surveys to 59 stakeholders and received 45  surveys from 40 stakeholders (68 percent response rate), which included  14 representatives of coal-fired power plants, 12 researchers and  government officials, and 14 technology vendors. Because we asked  technology vendors to complete one survey for each mercury control  technology that they develop, produce, or sell, the number of surveys  exceeded the number of respondents—five of the 14 vendors responding to  our survey submitted more than one survey. Upon receiving the surveys  and reviewing the questions, four stakeholders (1 power industry  representative, 1 vendor, and 2 researchers/government officials) informed  us that they were unable to participate. Finally, we contacted each  stakeholder who did not return a survey by the deadline several times,  either via email, phone, or both.
We developed separate nonprobability samples for each of the three groups  we surveyed, identifying stakeholders based on the extent of their  expertise and involvement with the research, development, and  demonstration of mercury control technologies.
To compile a list of mercury control technology vendors, we spoke with  DOE staff overseeing the mercury technology demonstration program  to identify companies that either manufacture a mercury control  technology for coal-fired power plants or research these technologies to  develop them commercially. Although we excluded from the technology  vendors group any company or organization that conducts research  solely for evaluative or academic reasons and lacks a significant  financial interest in the performance of the technology, we did include  these stakeholders in the researcher and government official group.  Next, we spoke with DOE and mercury technology vendors and  reviewed available documents to identify the stage of testing of each  company’s product(s), and we included on our list the companies whose  product(s) have undergone commercial demonstrations, full-scale field  tests, pilot-scale tests, or slipstream tests. We then corroborated the list  of mercury control technology vendors with the Institute of Clean Air  Companies, the national trade organization for air pollution control  vendors, to ensure the completeness of the list of mercury control  vendors. Our survey of mercury control technology vendors included a  representative from each of the 22 companies we identified as meeting  these criteria.
We identified an initial list of 21 representatives from the coal-fired  power industry to participate in our survey based primarily on a list  generated from Platts’ POWERdat database of the power generators  who burned the most coal in calendar year 2002, which is the most  recent year of available data. We determined that this database was  sufficiently reliable for this purpose. We based our selection of  stakeholders on the quantity of coal burned because it correlated more  closely with mercury emissions than any other available variable. We  included a representative from each of the 20 generators that burned the  most coal in calendar year 2002, accounting for 60 percent of the coal  burned for power generation in that year in the United States. One  company from this list declined to participate in our survey. Therefore,  we added the next-largest company on the list. This final group of 20  generators accounted for 59 percent of the coal burned for power  generation in that year. Additionally, we added one company to our  group of generators—resulting in a total of 21 generators surveyed— because it had begun a commercial demonstration of a mercury control  technology. Next, we corroborated our list of generators by asking  representatives of the following organizations to identify contacts  within the coal-fired power industry who would be knowledgeable of  mercury control technologies: (1) three power companies that have  actively participated in mercury control technology demonstrations; (2)  the Edison Electric Institute, the trade association for electric utilities;  and (3) the National Rural Electric Cooperative Association, which  represents utilities serving rural communities. The power industry  stakeholders identified by these three organizations all corresponded  with those we had placed in the group of 21 generators.
For the survey targeting researchers and government officials, we  included senior agency staff involved in the evaluation and development  of mercury control technologies within EPA’s Office of Research and  Development and DOE’s National Energy Technology Laboratory, state  government officials in states that initiated action to limit mercury  emissions from power plants, and experts from companies and non- profit organizations that do research on mercury control technologies.  We coordinated with the State and Territorial Air Pollution Program  Administrators/Association of Local Air Pollution Control Officials, the  national association of state and local air pollution control agencies, to  identify nine states that had initiated actions to reduce mercury  emissions from power plants and the state officials that had been  involved with research and development of mercury control  technologies. After speaking with representatives from these states, we  eliminated one of the states because the legislation did not specifically  target mercury emissions. We spoke to representatives of the following  eight states: Connecticut, Illinois, Iowa, Massachusetts, New  Hampshire, New Jersey, North Carolina, and Wisconsin.
We recognized that the technology vendors and power industry  respondents might have had concerns about disclosing sensitive or  proprietary information. Therefore, although we have included a list of the  survey respondents below, this report does not link individual survey  responses to any particular technology vendor or representative of the  coal-fired power industry. We mailed the survey to stakeholders on October  22, 2004, and asked to receive responses by November 8, 2004. Of the 59  stakeholders we contacted, the following 41 responded to our survey: American Electric Power Company, Incorporated  Enerfab Clean Air Technologies (CR Clean Air Technologies)
Hamon Research Cottrell  Illinois Environmental Protection Agency, Bureau of Air  New Hampshire Department of Environmental Sciences   New Jersey Department of Environmental Protection  North Carolina Division of Air Quality   Scottish Power Plc (Known as Pacificorps in the U.S.)
U.S. Department of Energy, National Energy Technology Laboratory   U.S. EPA, Office of Research and Development, Air Pollution Prevention  and Control Division   Wisconsin Department of Natural Resources, Bureau of Air  We supplemented and corroborated, to the extent possible, the survey  information with testimonial evidence. This included structured interviews  with 14 policy stakeholders familiar with the policy implications of  mercury control technology research, including senior staff at EPA’s Office  of Policy Analysis and Review and DOE’s Office of Fossil Energy, state and  local regulatory organizations, electric utility associations, and  environmental organizations. We developed a nonprobability sample for  the group of policy stakeholders. We worked with a survey expert to  develop a set of structured interview questions about the availability, use,  effectiveness, and cost of mercury control technologies. In order to  minimize nonsampling error, we took steps to ensure that the questions  were unambiguous, balanced, and clearly understandable. The interview  questions were similar to the survey questions, but tailored to reflect the  policy expertise of the interview participants. For example, rather than  asking interview participants to provide data on mercury technology  demonstrations, we sought their views on the implications of mercury  technology demonstrations for mercury policies. We conducted pretests of  the structured interview, including one with an EPA official in the Office of  Policy Analysis and Review. We made changes to the content and format of  the final interview questions based on the pretests.
We conducted the 14 structured interviews between November 2004 and  December 2004 with stakeholders from the following 13 organizations: Clean Air Task Force  Institute of Clean Air Companies  National Rural Electric Cooperative Association  Northeast States for Coordinated Air Use Management  Regional Air Pollution Control Agency  State and Territorial Air Pollution Program Administrators/Association  of Local Air Pollution Control Officers  U.S. Department of Energy, Office of Fossil Energy  U.S. Environmental Protection Agency, Office of Air and Radiation,  Office of Policy Analysis and Review  U.S. Environmental Protection Agency, Office of Air and Radiation,  Office of Air Quality Planning and Standards Finally, because of the important role monitoring data play in the  regulation of air pollutants, we gathered and analyzed information on the  availability and reliability of two kinds of mercury monitoring devices— sorbent traps and continuous emissions monitors—by conducting seven  structured interviews with the technology vendors and researchers in the  government and private sectors. We developed the list by consulting with  EPA’s lead expert on mercury monitoring technology and then comparing it  to the list of presenters at DOE’s Mercury Measurements Workshop, which  was conducted in July 2004. Because this list of monitoring technology  vendors primarily represented one of the two advanced mercury monitors,  we included an organization regarded as a major developer of the other  mercury monitoring device. Finally, we also included researchers and  government stakeholders with broad knowledge of the mercury monitoring  industry.
We could not interview all 18 stakeholders we identified for the sorbent  trap and continuous emissions monitors because of time constraints.
Therefore, we decided to (1) interview four researchers and government  officials, (2) interview the major producer of sorbent traps, and (3)  interview a random sample of the multiple vendors involved with the eight  kinds of continuous emissions monitors. Within this last group, we  compiled a list of 13 mercury monitoring vendors, which was then  randomized by a senior GAO methodologist. We interviewed the first 3  stakeholders on the randomized list of 13 mercury monitoring vendors in  order to include their knowledge and perspectives on the industry. We were  not able to reach the sorbent trap producer for an interview.
We based the questions for the monitoring interviews on those posed in the  mercury control technology surveys, including the same concepts and  emphasizing the availability and level of demonstration of monitoring  technologies, and again took steps to minimize nonsampling errors. We  conducted two pretests of the monitoring interviews. Finally, we  corroborated the numerical values used in questions about the accuracy  and reliability of mercury monitors with EPA’s mercury monitoring expert  in the Office of Research and Development. We made changes to the  content and format of the final interview questions based on the pretests  and the EPA official’s comments.
Lastly, we identified and reviewed governmental and nongovernmental  reports estimating the cost of mercury control technologies. We identified  two government cost reports—one from EPA and one from DOE—and four  nongovernmental cost reports. We excluded two of the nongovernmental  reports from our analysis because these reports addressed cost issues that  were either too limited in scope or were not germane to our research  objectives. We then reviewed the results of both government reports and  two remaining nongovernmental reports as part of our technology cost  analysis. We took several steps to assess the validity and reliability of  computer data underlying the cost estimates in the EPA, DOE, and  nongovernmental reports which were discussed in our findings, including  reviewing the documentation and assumptions underlying EPA’s economic  model and assessing the agency’s process for ensuring that the model data  are sufficient, competent, and relevant. We determined that these four  reports are sufficiently reliable for the purposes of this report.
As part of our effort to consider data on mercury control demonstrations  and costs, we assessed compliance with internal controls related to the  availability of timely, relevant, and reliable information. We also obtained  data on mercury emissions. Because the emissions data are used for  background purposes only, we did not assess their reliability.
We performed our work between May 2004 and May 2005 in accordance  with generally accepted government auditing standards.
section_title: Availability and Costs of Mercury Monitoring Technology
paragraphs: This appendix provides information on technologies that facilities may use  to monitor mercury emissions, including background information on  monitoring technologies and requirements under EPA’s mercury rule, as  well as on the availability and cost of different monitoring technologies.
subsections: section_title: Background
paragraphs: In addition to technologies that control emissions, those that monitor the  amount of a pollutant emitted can play an equally important role in the  success of an air quality rule’s implementation. For example, effective  emissions monitoring assists facilities and regulators in assuring  compliance with regulations. In some cases, monitoring data can also help  facilities better understand the efficiency of their processes and identify  ways to optimize their operations.
Accurate emissions monitoring is particularly important for trading  programs, such as that established by the mercury rule. According to EPA,  the most widespread existing requirements for using advanced monitoring  technologies stem from EPA’s Acid Rain program. Under the program,  power plants have been allowed to buy and sell emissions allowances, but  each facility must hold an allowance for each ton of sulfur dioxide it  emitted in a given year; furthermore, facilities must continuously monitor  their emissions. According to EPA, monitoring ensures that each  allowance actually represents the appropriate amount of emissions, and  that allowances generated by various sources are equivalent, instilling  confidence in the program. Conversely, a study by the National Academy of  Public Administration found that the lack of monitoring in other trading  programs led to difficulty in ensuring the certainty of emissions reductions.
EPA’s mercury rule requires mercury emissions monitoring and quarterly  reporting of mercury emissions data. For plants that emit at least 29  pounds of mercury annually, EPA requires continuous emissions  monitoring, while sources that emit less than this amount may instead  conduct periodic testing—testing their emissions once or twice a year  depending on their emissions level. According to EPA, the mercury  emissions from sources exempt from continuous monitoring comprise  approximately 5 percent of nationwide emissions. EPA estimates that the  annual impact in monitoring costs for the entire industry will total $76.4  million.
section_title: EPA Expects That Monitoring Technologies Will Be Available Prior to the Compliance Deadlines
paragraphs: EPA expects that two technologies will be available to monitor mercury  emissions continuously prior to the rule’s deadline and requires continuous  emissions monitoring for most facilities either by a Continuous Emissions  Monitoring System (CEMS) or a sorbent trap monitoring system, while  facilities that emit low levels of mercury can conduct periodic monitoring  using a testing protocol known as the Ontario-Hydro Method:  CEMS continuously measures pollutants released by a source, such as a  coal-fired power plant. Some CEMSs extract a gas sample from a  facility’s exhaust and transport it to a separate analyzer while others  allow effluent gas to enter a measurement cell inserted into a stack or  duct. This allows for continuous, real-time emissions monitoring. EPA  estimates that a unit’s annual CEMS operating, testing, and maintenance  cost would be about $87,000, while a unit’s capital cost would be about  $70,000.
Sorbent trap monitoring systems collect a mercury sample by passing  flue gas through a mercury trapping medium, such as an activated  carbon tube. This sample is periodically removed and sent to a lab for  analysis. The rule requires that the average measurement of two  separate sorbent trap readings be reported. Sorbent trap monitoring  allows for continuous monitoring, but is not considered a real-time  method. EPA estimates that a unit’s annual sorbent trap operating and  testing costs would be about $113,000 per year, while a unit’s capital  cost would be about $20,000.
The Ontario-Hydro Method, a periodic testing method, involves  manually extracting a sample of flue gas from a coal-fired plant’s stack  or duct, usually over a period of a few hours, which is then analyzed in a  laboratory. EPA estimates this method would cost about $12,500 a year  for two tests and about $7,000 for one test.
section_title: Stakeholders Believe That Mercury Monitoring Technology Is Available, Reliable, and Will be Able to Meet Quality Control and Assurance Standards by 2008
paragraphs: All of the stakeholders we asked about the availability of CEMS or sorbent  trap systems said that the technologies were available for purchase.  Furthermore, an EPA monitoring technology expert and the vendors we  interviewed agreed that there were no technical or manufacturing  challenges that would prevent vendors from supplying monitors to coal- fired power plants by 2008. However, some researchers identified factors  that could affect vendors’ ability to supply monitors by that date, including  whether vendors had sufficient production capacity to meet the industry’s  demand for the equipment. All three vendors we interviewed were aware of  power plants in other countries that had installed mercury monitoring  equipment (including Germany, Japan, and the United Kingdom). Two  respondents were aware of power plants in the United States that had  permanently installed mercury monitoring equipment.
Most researchers considered CEMS and sorbent trap technologies to be  accurate and reliable, and the CEMS vendors also characterized their  technologies as accurate and reliable. Researchers cited the need for  additional testing of certain subcomponents of the continuous monitoring  systems. Stakeholders were generally confident that these technologies  would be able to meet proposed quality control and assurance standards by  2008, although two researchers expressed concerns that EPA’s proposed  standards might be too strict for CEMS to meet.
According to EPA, recent field tests have demonstrated that sorbent trap  systems can be as accurate as CEMS. The rule requires the implementation  of quality assurance procedures for sorbent trap monitoring systems,  which EPA says are based on field research and input from parties that  commented on the agency’s mercury rule during the public comment  period. EPA acknowledges that there may be problems with the  technology, such as the possibility of the traps becoming compromised,  lost, or broken during transit or analysis, which could result in missing  data; however, EPA also believes steps can be taken to minimize these  possibilities.
section_title: Summary of Field-Scale Tests of Mercury Controls
paragraphs: The table below summarizes data about mercury control tests, including  the power plant location, duration of continuous testing, coal type, and  average mercury removal. We obtained data from DOE’s National Energy  Technology Laboratory and from the 40 survey respondents about field  tests. The tests that have been partially funded by DOE’s National Energy  Technology Laboratory are identified in the table below by an asterisk  symbol.
section_title: Summary of Stakeholder Perceptions about Availability of Mercury Controls
paragraphs: This appendix provides more detailed information on stakeholders’ views  regarding the availability of the different mercury controls. Please refer  back to appendix I for details about our survey methodology.
Of the stakeholders that either responded to our survey (40) or participated  in an interview (14), a majority (40) believed that at least one technology  was currently available for purchase. As shown in table 2, many of the  researchers and government officials said that activated carbon injection (8  of 12) and chemically enhanced carbon (7 of 12) are currently available,  while less than half of the power industry officials also believe activated  carbon injection technology is available (6 of 14). All of the vendors  associated with carbon-based sorbent injection, including activated carbon  (4) and chemically enhanced carbon (2), described their technology as  available. In addition, 13 of the 14 policy stakeholders we interviewed— those who do not participate in technology research but are involved in the  development of mercury control policy, including representatives of EPA,  DOE, regional and local air pollution agencies, environmental advocacy  groups, and the electric utility industry—believe that sorbent technology is  currently available for purchase.
The survey responses regarding the availability of other mercury controls  were more limited and less optimistic than those for sorbent injection.  While 40 of the 54 stakeholders answered questions about the availability  of activated carbon injection, far fewer respondents answered the  questions about the availability of other controls. As shown in table 3, the  stakeholders who responded to questions about nonsorbent control  technologies, such as multipollutant controls, mercury oxidation  technologies, and enhancements to existing controls for other pollutants,  were more mixed in their views about the availability of these technologies.  For example, researchers and government officials expressed a range of  views about mercury oxidation technologies—4 believe they are available,  3 do not think they are available, 2 did not know, and 3 chose not to answer  this question.
Finally, the 14 policy stakeholders we interviewed also expressed mixed  views on the availability of mercury controls. Nine described various  multipollutant controls as available, 5 viewed mercury oxidation as  available, and 8 regarded various enhancements to existing technologies as  available.
section_title: Stakeholder Confidence in Ability of Technologies to Achieve Mercury Reductions under Three Scenarios
paragraphs: This appendix summarizes the perceptions of survey respondents in the  ability of mercury controls to reduce emissions under three scenarios.  (Appendix I provides details about our survey methodology.)
We asked survey respondents to assess their confidence in the ability of  power plants to achieve mercury reductions of 50, 70, and 90 percent by the  year 2008 under two different scenarios. The first scenario resembled the  cap-and-trade approach recently finalized by EPA in that it asked  stakeholders to consider whether the industry could use available  technologies to achieve industrywide reductions of 50, 70 or 90 percent by  2008. The second scenario was similar to an alternative approach  considered by EPA that would have required each plant to reduce  emissions; for this scenario we asked respondents whether each individual  plant could use available technologies to achieve the percentage reductions  by 2008.
As shown in tables 4 through 9, the confidence levels depended on the level  of reduction required and by stakeholder group. Overall, the technology  vendors answering this question expressed the greatest confidence, while  the power industry respondents were the least confident. Within each  stakeholder group, respondents expressed the greatest confidence overall  in achieving a 50 percent reduction by 2008—a reduction that EPA requires  under its 2010 cap—and progressively less confidence in the 70 and 90  percent scenarios. For both possible control scenarios—the national limit  and facility-specific reductions—a majority of the 38 respondents  expressed confidence in achieving the 50 percent reductions (see tables 4  and 5), but many lacked confidence in the feasibility of 90 percent mercury  reductions by 2008 (see tables 8 and 9). Respondents expressed mixed  opinions about the feasibility of 70 percent reductions by 2008, as shown in  tables 6 and 7.
section_title: Sorbent Injection Cost Estimates from EPA and DOE
paragraphs: This appendix summarizes estimates of the cost of activated carbon  injection reported by EPA and DOE in October and November 2003.
Environmental Protection Agency. Using modeling data provided in EPA’s  cost report, we selected control cost scenarios that are comparable to  those DOE presented in its cost study. These estimates include the cost of  fly ash disposal for plants that use sorbent injection without a fabric filter,  based on the assumption that the presence of sorbent in fly ash makes it  unsuitable for sale. EPA provided capital costs in dollars per unit of  generating capacity, and operating and maintenance costs in dollars per  unit of electricity generated (per hour) for 100- and 975-megawatt plants  operating at 65 percent capacity over the course of a year (5,694 hours).  Tables 10 and 11 present the range of capital and operating and  maintenance costs for the selected EPA plant scenarios; capital costs are in  total dollars while operating and maintenance costs are expressed in  dollars per year.
EPA estimated that the capital cost of sorbent injection for a 100-megawatt  plant would range from $0.17 to $59.5 per kilowatt of capacity, while  operating and maintenance costs for the same plant would range from  $0.001 to $2.36 per megawatt-hour. For the 975-megawatt plant, EPA  estimated that the capital cost would range from $0.09 to $37.1 per  kilowatt, while operating and maintenance costs would range from $0.001  to $2.32 per megawatt-hour. EPA also estimated the total annualized cost of  these controls in 2003 dollars, which ranged from $0.005 to $2.64 per  megawatt-hour or between $2,847 and $1.5 million per year for a 100- megawatt plant. For a 975-megawatt plant, annualized costs ranged from  $0.003 to $2.45 per megawatt-hour or between $16,655 and $13.6 million per  year.
Capital costs were much higher for scenarios where a fabric filter was  installed, while the highest operating and maintenance cost and annualized  cost were for achieving a 90 percent mercury reduction for a bituminous  coal-fired plant using sorbent injection without installing a fabric filter, due  to the amount of sorbent needed to achieve a high mercury removal. At the  low end of these costs, EPA assumed that existing equipment is sufficient  to achieve a 50 percent reduction in mercury for plants that burn  bituminous coal, therefore costs reflect only that of monitoring mercury  emissions and do not include actual sorbent injection costs. While total  capital and annual costs for the larger plant were higher than for the  smaller plant, the annualized cost in dollars per megawatt-hour was  actually lower, since costs were spread out over more units of capacity and  electricity generated.
Department of Energy. DOE’s analysis of the cost of mercury control  technologies was based on field testing conducted by DOE’s National  Energy Technology Laboratory. For its estimates, DOE used a hypothetical  power plant of 500 megawatts burning bituminous or subbituminous coal  and equipped with an electrostatic precipitator or a layout that consists of  sorbent injection and a fabric filter retrofitted downstream of an existing  electrostatic precipitator. Cost estimates were developed for mercury  removal requirements ranging from 50 to 90 percent as shown below in  table 12. DOE estimated capital costs between $1.97 and $57.44 per  kilowatt. The high end of the capital cost range represented cases where  facilities installed a supplemental fabric filter to achieve higher levels of  mercury reduction, while the high end of the operating and maintenance  costs represented achieving a 90 percent reduction in mercury emissions  for a plant burning bituminous coal using sorbent injection without a fabric  filter.
DOE also provided two sets of annualized cost estimates, one that included  a projected impact for the loss of fly ash sales and one that did not. Without  a by-product impact, DOE estimated annualized costs to range from $0.37  to $5.72 per megawatt-hour, which equates to about $1.3 million to $20.0  million per year. Estimates with the by-product impact ranged from $1.82 to  $8.14 per megawatt-hour, which equates to about $6.4 million to $28.5  million per year. At the high end, these estimates represented the cost of  achieving a 90 percent mercury reduction at a bituminous-coal fired plant  with sorbent injection, an existing electrostatic precipitator, and no fabric  filter. The low-end cost without a by-product impact represented a 50  percent mercury reduction at a bituminous-fired plant using sorbent  injection with an electrostatic precipitator, while the low-end cost with a  by-product impact was for the same configuration and mercury reduction,  but at a subbituminous-fired plant.
In addition, DOE’s cost estimates suggest that plants may achieve a high  level of mercury control without a fabric filter. While achieving a higher  mercury removal rate without a fabric filter would require more sorbent,  plants can decide what air pollution control configuration is most cost  effective. Furthermore, according to EPA, test results suggest that  chemically enhanced sorbent may prove more efficient than activated  carbon in achieving high levels of mercury removal at relatively modest  injection rates, and thus less expensive to use. According to EPA, tests of  these sorbents have achieved mercury removal rates of 40 to 94 percent  without a fabric filter, with the highest removal rate achieved during a  continuous 30-day test (the longest reported test of these sorbents).  Therefore, some facilities seeking to achieve high levels of mercury  reduction may not have to incur the substantial cost of adding a fabric  filter.
section_title: GAO Contact and Staff Acknowledgments
subsections: section_title: GAO Contact
section_title: Acknowledgments
paragraphs: In addition to the contact named above, Kate Cardamone, Christine B.  Fishkin, Tim Guinane, Michael Hix, Andrew Huddleston, Judy Pagano, and  Janice Poling made key contributions to this report.  Nabajyoti Barkakati,  Cindy Gilbert, Jon Ludwigson, Stuart Kaufman, Cynthia Norris, Katherine  Raheb, Keith Rhodes, and Amy Webbink also made important  contributions.