Air Pollution: Estimated Emissions from Two New Mexicali Power Plants Are Low, but Health Impacts Are Unknown
Published: 2005-08-12T00:00:00

Fast Facts:

Highlights:
section_title: Why GAO Did This Study
paragraphs: Power plants emit pollutants that have been linked to various negative health effects. In 2003, two new power plants, owned by Sempra Energy and Intergen, began operations 3 miles south of the U.S.-Mexico border near Imperial County, California. The county does not meet some federal and state air quality standards and may be further impacted by the emissions from these plants. Although these plants export most of the electricity they produce to the United States, they are not currently required to meet any U.S. or California emissions standards. GAO was asked to determine (1) how emissions from the two plants compare with emissions from recently permitted plants in California and emissions from sources in Imperial County, and what emissions standards they would be subject to if they were located in Imperial County; (2) the health impacts of emissions from the plants on Imperial County residents; and (3) options available to U.S. policymakers to ensure that emissions from these plants do not adversely affect the health of Imperial County residents. In commenting on a draft of this report, DOE disagreed with our characterization of the limitations of their assessment of the health impact of pollution from the Sempra and Intergen power plants. We believe we have portrayed the limitations of this assessment accurately.
section_title: What GAO Found
paragraphs: The estimated emissions from the Sempra and Intergen power plants near Mexicali are comparable with similar plants recently permitted in California and are low relative to emissions from the primary sources of pollution in Imperial County, California, which are dust and vehicles. However, if the plants were located in Imperial County, they would be required to take steps to improve air quality by reducing emissions from other pollution sources in the region, such as paving dirt roads, because the county is not meeting certain U.S. air quality standards. Although emissions generated from the Sempra and Intergen plants may contribute to various adverse health impacts in Imperial County, the extent of such impacts is unknown. The Department of Energy (DOE) estimated that emissions from these plants may increase asthma hospitalizations by less than one per year. However, DOE did not quantify any other asthma-related impacts, such as emergency room visits or increased use of medications, which, although less severe, are likely to occur more often. In addition, DOE did not determine whether increased emissions would cause other respiratory or cardiovascular problems and the impact of particulate matter on particularly susceptible populations. Finally, the potential health impacts associated with ozone could be greater than DOE estimated because some important data needed for modeling were not available. Existing laws and international agreements may not provide adequate mechanisms to address adverse health impacts resulting from power plant emissions. Policymakers could take some actions, such as requiring plants that seek to export electricity to the United States to use specified emission controls. While this action would have benefits, it would also have costs, such as possibly reducing energy supplies available to Southern California. Long-term policy options include the development of a binational pollution reduction program or a trust fund to provide grants and loans to support air quality improvement projects. However, substantial efforts on both sides of the U.S.-Mexico border would be required to establish the legal and management framework necessary for such programs to be effective.

section_title: Letter
paragraphs: In 2003, two new power plants owned by American-based corporations,  Sempra Energy and Intergen, began operations 3 miles south of the U.S.- Mexico border near Mexicali, Mexico, and Imperial County, California.  These modern natural gas-fired plants use advanced pollution control  technologies; nevertheless, they emit some pollutants such as nitrogen  oxides and airborne particles, known as particulate matter. Some health  studies have found that even the smallest incremental increase in the  amount of particulate matter in the air corresponds with an increase in  adverse health effects.
The U.S.-Mexico border region is experiencing significant economic,  industrial, and population growth, and that growth is expected to  continue. Imperial County is one of the fastest growing counties in  California and is expected to double in population by 2025. The county  does not currently meet some federal and state air quality standards and  has one of the highest asthma prevalence rates for children ages 1 through  17 in the state. The increased demand for energy to meet the needs of the  border region could lead to the construction of additional power plants,  with the associated potential for increased air pollution and negative  impacts on public health.
In the United States, the Clean Air Act establishes the principal framework  for federal, state, and local efforts to protect air quality. Under this act, the  Environmental Protection Agency (EPA) establishes health-based air  standards that the states must meet. EPA has issued air quality standards  for six primary pollutants—carbon monoxide, lead, nitrogen dioxide,  ozone, sulfur dioxide, and two categories of particulate matter (PM2.5 and  PM)—that have been linked to a variety of health problems. Agencies  collect data on the levels of these pollutants to determine if air quality is  meeting the federal standards. Areas that do not meet these federal  standards are designated as “nonattainment” areas and are, as a result,  generally subject to more stringent emission control requirements.  Imperial County is currently designated as a nonattainment area for PM New facilities being built within a nonattainment area that are  expected to generate emissions above a certain threshold may be required  to provide mitigation measures in the form of emission offsets. These  offsets are designed to improve air quality in nonattainment areas by  reducing emissions from other pollution sources in the region. They could  include, for example, providing funds to update diesel engines or to pave  dusty dirt roads. ), a common air pollutant, is one of a group of gases collectively  known as nitrogen oxides, or NOX. The term NOX is used commonly in both the United  States and Mexico to describe these gases, but NO, also known as fine and coarse particulate matter, respectively, refer to the  size of the airborne particles measured at the diameter (in micrometers). equipment these plants are using, their estimated emissions of NOX are  significantly lower than the established emission limit in Mexico.
The electricity generated by these plants is transmitted into the United  States over electric transmission lines authorized by presidential permits  issued by the Department of Energy’s (DOE) Office of Fossil Energy.  These permits are required before electric transmission facilities are  constructed, operated, maintained, or connected at the U.S.-Mexico  border. DOE is responsible for reviewing permit applications and  conducting an environmental evaluation as part of this review. DOE issued  a final environmental impact statement on the Sempra and Intergen  transmission lines in December 2004 that included an assessment of the  potential health impacts associated with emissions from the power plants.
In this context, you asked us to determine (1) how emissions from the  Sempra and Intergen power plants compare to emissions from recently  permitted plants in California and emissions from sources in Imperial  County, and what emissions standards the plants would be subject to if  they were located in Imperial County; (2) the health impacts of emissions  from the power plants on Imperial County residents; and (3) what options  exist for U.S. policymakers to ensure that emissions from these power  plants do not adversely affect the health of Imperial County residents.
To address these objectives, we visited the Sempra and Intergen plants  near Mexicali, Mexico; interviewed plant representatives, various federal,  state, and local air quality officials, and other key stakeholders; and  reviewed relevant documents and studies. To address how emissions from  the Sempra and Intergen power plants compare to emissions from recently  permitted plants in California, we used data from emissions tests  conducted at the plants by third-party contractors. We did this because  Mexico does not require the plants to report actual emissions of pollutants  other than nitrogen oxides. We assessed the reliability of the data by (1)  reviewing documentation of test objectives and quality control procedures  provided by the third-party contractors who conducted the tests, (2)  talking with Sempra and Intergen officials to determine the scope and  generalizability of the tests, and (3) reviewing reports of actual NOX  emissions submitted to the Mexican government to verify consistency with  the test results. We determined that the data were sufficiently reliable for  the purposes of this report. We also obtained the permissible emission  limits for comparable plants in California. Comparable plants were  selected by identifying all natural gas power plants of similar size and  specifications to the Sempra and Intergen plants that were permitted in  California between 2000 and 2004. Because all California power plants are  permitted on a case-by-case basis, emissions limits may vary with each  project. Therefore, we used the entire range of emission limits for the 23  plants that were identified during our selection process. To determine how  the emissions from the Sempra and Intergen power plants compared to  emissions from sources in Imperial County, we utilized the 2004 estimated  annual average emissions inventory for the county developed by the  California Air Resources Board, among other things. To address what  emissions standards the plants would be subject to if they were located in  Imperial County, we reviewed federal and California regulations for new  power plants, interviewed EPA, state, and Imperial County air quality  officials, and reviewed the emission limits and selected permitting  conditions for power plants located in California. To identify the potential  health impacts from plant emissions, we reviewed the health assessment  methodology DOE used in its environmental impact statement, reviewed  relevant studies, and met with health experts. To determine available  policy options, we reviewed the Clean Air Act; environmental and trade  agreements among the United States, Mexico, and Canada; and academic  research. See appendix I for additional details on our scope and  methodology. We conducted our work between September 2004 and  August 2005 in accordance with generally accepted government auditing  standards.
subsections: section_title: Background
paragraphs: The Sempra and Intergen plants are located in close proximity to each  other near Mexicali, Mexico—an area 3 miles south of the U.S.-Mexican  border and Imperial County, California (see fig. 1). Final permitting and  construction for both of the plants and the associated transmission lines to  the United States began in 2001, and commercial operations commenced  in July 2003. Fuel for the plants is provided by a 145-mile cross-border  natural gas pipeline built by Sempra Energy, which began operating in  September 2002.
The Sempra plant, known as Termoelèctrica de Mexicali, consists of one  natural gas-fired, combined-cycle power-generating unit with a total  capacity of 650 megawatts. In this type of plant, electricity is produced by  a combination of gas turbines and steam turbines. Heat from the gas  turbine exhaust, which would otherwise be released to the atmosphere  with exhaust gases, is captured and used by a heat recovery steam  generator to produce steam, which in turn is used by the steam turbine to  generate additional electricity. The Sempra plant operates with an export  permit from the Mexican government and produces electricity exclusively  for export to the United States. The facility is equipped with the latest  pollution control technologies, including selective catalytic reduction  systems to reduce NOX emissions and an oxidizing catalyst system to  reduce carbon monoxide (CO) emissions.
The Intergen plant, which consists of two natural gas-fired combined-cycle  units (collectively known as the La Rosita Power Complex), has a total  capacity of 1,060 megawatts. The first unit provides two-thirds of its 750  megawatt capacity to Mexico, with the remaining one-third available for  export to the United States. The second unit has a generating capacity of  310 megawatts, all of which is designated for export to the U.S. market.  (See fig. 2.) Originally, only the second unit was designed to include a  selective catalytic reduction system, but as of April 7, 2005, all four of the  combustion turbines within the two units have been equipped with these  systems to control NOX emissions. ) to produce ordinary nitrogen and water  vapor. An oxidizing catalyst is similar in concept to catalytic converters used in  automobiles. The catalyst, normally coated with a metal, such as platinum, is used to  promote a chemical reaction with the oxygen present to convert carbon monoxide into  carbon dioxide and water vapor.
Although no U.S. emissions requirements apply to these plants, Sempra  and Intergen required a presidential permit to construct and connect the  new transmission lines needed at the U.S.-Mexican border to export  electricity into the United States. Because of the similarities of the  proposals submitted by the companies, DOE decided to consider them  together in a single environmental assessment, required as part of the  permitting process. In December 2001, DOE completed the environmental  assessment and issued a finding of no significant impact and presidential  permits for both of the proposed projects. Following these decisions,  Sempra and Intergen constructed the transmission lines and began  commercial operations. However, as a result of subsequent litigation, on  July 8, 2003, the U.S. District Court for the Southern District of California  instructed DOE to prepare a more comprehensive environmental review,  which included an assessment of the health impacts from the power plants  as part of its analysis. DOE’s environmental impact statement was issued  in final form in December 2004. DOE found that the proposed power  plants presented a low potential for environmental impacts and published  a record of decision in the Federal Register on April 25, 2005, authorizing  presidential permits to be granted for both transmission lines to the  respective power plants as presently designed. use of natural gas at the Sempra and Intergen facilities greatly reduces  sulfur dioxide emissions compared with other fuels such as coal or oil. For  example, U.S. coal contains an average of 1.6 percent sulfur, and oil  burned at electric utility power plants ranges from 0.5 percent to 1.4  percent sulfur; comparatively, natural gas has less than 0.0005 percent  sulfur.
section_title: Emissions from the Mexicali Plants Are Comparable to New Plants in California, but Offset Requirements Would Apply in Imperial County
paragraphs: The emissions from the Sempra and Intergen power plants in Mexicali are  comparable to emissions from similar plants recently permitted in  California and are low relative to emissions from the primary sources of  pollution in Imperial County, which are various forms of dust and motor  vehicles. However, if the plants were located in Imperial County, they  would be required, among other things, to offset their emissions by  reducing emissions from other pollution sources in the region.
subsections: section_title: Estimated Emissions from the Sempra and Intergen Plants Are Comparable to Emissions from New California Plants
paragraphs: Power plants in Mexico are not required to report to federal agencies in  the United States on actual emissions of key pollutants generated during  plant operations. Therefore, we believe that the best data available to  estimate emissions from the Sempra and Intergen power plants comes  from emission performance tests conducted by independent third-party  contractors hired by the power plants. The average emissions from the  Sempra and Intergen plants based on the results of the third-party testing  are presented in table 2.
Intergen average(US export) (Mexico)
NOX (ppm)   (ppm)
VOC (lbs/hr)
Legend: NOX = nitrogen oxides; ppm = parts per million; PM = particulate matter; lbs/hr = pounds per  hour; CO = carbon monoxide; NH levels are computed based on a 1, 3, or 24- hour average.
VOC emissions were undetectable during tests conducted at the plant.
As shown in table 3, the average NOX emissions from the Intergen power  plant were the only emissions that exceeded the range of emissions from  recently permitted plants in California. This was the case, in part, because  the plant was not originally designed to meet California requirements.  However, as of April 7, 2005, all combustion turbines at the Intergen plant  had been equipped with the selective catalytic reduction control  technology for nitrogen oxide that is common in the newer California  plants. With the exception of one turbine, which will continue to operate  at a maximum NOX limit of 3.5 ppm, all other turbines are expected to emit  NOX at a level below 2.5 ppm. According to Intergen plant officials, the last  two turbines to be equipped with selective catalytic reduction systems  have been meeting these levels since the systems became operational in  March and April 2005, respectively. Data provided by plant officials, based  on continuous monitoring of all emissions from these turbines over a 1  week period, also indicate that both turbines are achieving the expected  NOX reductions.
section_title: Estimated Annual Emissions from the Sempra and Intergen Plants Are Low Relative to Emissions from Sources in Imperial County
paragraphs: One way to assess the environmental impact of emissions from power  plants is to examine the tons of pollutants they emit on an annual basis.  The third-party performance tests discussed above provide the best  available data to estimate annual emissions likely to occur during actual  operations at the Sempra and Intergen plants because the data are based  on observations of the actual equipment in operation. Other options for  estimating annual emissions from these plants include using (1) the  maximum allowable emissions levels for similar plants in California and  (2) the emissions estimates that DOE developed during its environmental  impact assessment of the Sempra and Intergen plants. Table 4 presents  annual emissions estimates based on each of these three alternative  operating assumptions.
Under the first scenario, annual emissions levels were estimated using the  values determined by third-party contractors during turbine performance  tests at the Sempra and Intergen plants. For the two Intergen turbines that  did not have selective catalytic reduction systems installed when the  testing was conducted, we estimated annual NOX emissions using the  testing values recorded for the similar turbine that was operating with  such equipment. We did so because these two turbines are now equipped  with selective catalytic reduction systems and their future emissions are  likely to be similar to those from the turbine that was using this  technology during the tests. These estimates do not take into account  start-up and shutdown operations of the plant, which may contribute to  increased plant emissions for approximately 1 to 2 hours. However, the  total annual estimate is based on the conservative assumption that the  plants are operating at maximum emission levels, 24 hours a day, 365 days  a year. The actual operation of the plants, and the resulting emissions,  would be less than this because of scheduled maintenance, forced  outages, and varying electrical demand in California.
The second estimates of annual emissions were based on maximum  allowable emissions determined during the permitting process for similar  California plants. These maximum allowable emissions are higher than the  estimates based on third-party testing data. California grants permits to  construct power plants on a case-by-case basis. As a condition of receiving  a permit, the state places limits on emissions of individual pollutants.  These limits are based on the use of best available control technology and  take into consideration energy, environmental, and economic impacts.  Under this estimating scenario, the annual estimates also account for short  term variations in emissions levels that may occur during start-up and  shutdown operations and are based on the conservative assumption that  the plants are operating at maximum emissions levels, 24 hours a day, and  365 days a year.
Another way to examine the environmental impact of a power plant is to  evaluate the amount of pollution emitted per unit of electricity produced.  This calculation has been used within the energy industry to measure how  efficiently power plants produce electricity. As illustrated in table 6, the  Sempra and Intergen plants produce much lower emissions of NOX for  each megawatt of energy generated than do other power plants operating  in Imperial County and the border region of Baja California, Mexico. For  example, Sempra’s estimated emission rate for NOX of .04 pounds per  megawatt of electricity is over 35 times lower than that rate at El Centro,  the only major fuel-fired plant operating in Imperial County in 2002.
section_title: If the Plants Were Located in Imperial County, California, among Other Things, Standards Would Require Them to Offset Their Emissions
paragraphs: If the Sempra and Intergen plants were located in Imperial County, to help  improve air quality, California regulations would require, among other  things, offsets for all emissions from the plants that contribute to  nonattainment of the PM and ozone standards in the county. Under the  specific offsetting rules established by the Imperial County Air Pollution  Control District, the operators of each plant would be required to reduce  emissions from other pollution sources in Imperial County by at least 1.2  tons for every ton of emissions the plants released. In addition to  offsetting emissions of PMIntergen would also be required to offset all emissions of VOC, which, in  combination with NOX, contribute to the formation of ozone.
As shown in table 7, potential offsets identified by the Imperial County Air  Pollution Control District in DOE’s environmental impact statement  include (1) paving roads, (2) retrofitting emission controls on existing  power plants in Imperial County, (3) funding projects designed to increase  the use of natural gas in motor vehicles, (4) controlling Imperial County  airport dust, and (5) retrofitting diesel engines for off-road heavy duty  vehicles. According to the Air Pollution Control District, repaving  approximately 23 miles of roads could reduce PM emissions in Imperial  County by about 650 tons per year—more than the estimated annual PMIn addition to the potential offsets identified above for Imperial County,  according to DOE, mitigation measures may be even more abundant and  cost-effective if applied on the Mexican side of the border. Some potential  projects include paving roads in Mexicali, Mexico; replacing older  automobiles and buses with newer, less polluting ones; and converting  brick kilns to run on natural gas. However, according to DOE, it does not  have the authority to impose or enforce offsets in Mexico.
Finally, if the power plants were located in California, the Intergen plant  would likely be required to make additional equipment modifications to be  consistent with other plants recently constructed in California. These  modifications would include installing additional carbon monoxide control  equipment and achieving a small reduction in NOX emissions in one of the  plant’s four combustion turbines. Although emissions testing data indicate  that Intergen’s carbon monoxide levels are generally comparable to those  of California plants without this equipment, nearly all of the plants  recently permitted in California have installed oxidizing catalyst systems  to control carbon monoxide emissions. In addition, the Intergen plant  would likely be required to lower the maximum NOX emissions in one  turbine by 1.0 ppm—from 3.5 ppm to 2.5 ppm. Although this turbine is  currently equipped with a selective catalytic reduction system to control  NOX emissions, Intergen has stated that certain technical aspects of the  design of the turbine prevent it from attaining emissions levels of 2.5 ppm.
section_title: Emissions Generated by the Sempra and Intergen Power Plants May Contribute to Various Adverse Health Impacts in Imperial County, but the Extent of Such Impacts Is Unknown
paragraphs: Emissions from the Sempra and Intergen power plants may contribute to  adverse health impacts in Imperial County, but the extent of those impacts  is unknown for several reasons. First, in its environmental impact  statement, DOE did not calculate the total health impacts in the county  because it did not analyze all the likely asthma-related or other health  impacts from the increased pollution caused by the Sempra and Intergen  plants. Second, DOE did not analyze the health impacts from increased  power plant emissions on particularly susceptible populations, such as  asthmatic children and low-income populations. Finally, because of  uncertainty in DOE’s modeling of ozone increases due to emissions from  the power plants, the health impacts related to ozone may be larger than  DOE estimated.
subsections: section_title: DOE Did Not Analyze All the Likely Asthma-Related and Other Health Impacts of Increased Pollution from the Sempra and Intergen Power Plants
paragraphs: calculated that emissions from the power plants would be expected to  increase asthma hospitalizations in the county by less than one case per  year. However, DOE’s analysis did not quantify all of the health impacts  from the increase in PM emissions.
Health experts told us that the potential impact on asthmatics would be  broader than the minimal increase in hospitalizations described in the  environmental impact statement because hospitalization occurs only in the  most acute asthma cases. According to these experts, an increase in PM Approximately 13,000 of  these asthmatics experienced asthma symptoms during the previous year.  The health experts we spoke with agreed that hospitalizations and other  adverse health effects are part of a pyramid of potential adverse health  effects. While the number of hospitalizations is represented at the top of  the pyramid, other adverse health impacts such as emergency room visits,  physician visits, asthma medication use, and increased asthma symptoms  are layered vertically downward, with the number of people increasing in  each subsequent group as you move to the bottom of the pyramid (see fig.  4).
In addition, the DOE study did not address the extent to which increased  emissions of particulate matter would cause other adverse health impacts,  such as other respiratory or cardiovascular problems. These impacts could  include chronic obstructive pulmonary disease, pneumonia,  cardiovascular disease, as well as increased symptoms of upper and lower  respiratory disease, decreased lung function, or premature death.  According to the project manager of DOE’s analysis, the expected  incidence of other adverse health effects resulting from PM exposure has  not been quantified because of a lack of data.
section_title: DOE Did Not Analyze the Health Impacts on Particularly Susceptible Populations in Imperial County
paragraphs: Studies funded by EPA, the Health Effects Institute, and others have  concluded that certain groups are likely to be more susceptible to  particulate matter than others, and therefore experience more adverse  health effects. For example, these studies identified asthmatics, especially  children, as a potentially susceptible subpopulation. According to data  from the 2003 California Health Interview Survey, approximately 19  percent of Imperial County children ages 1 through 17 have been  diagnosed with asthma, or about 9,000 children. In addition, the  relationship between socioeconomic factors and asthma exacerbation has  been documented in various studies. Imperial County is ranked as one of  the poorest counties in California, with some of the highest poverty and  unemployment rates in the state. An estimated 22 percent of the overall  population lives below the national poverty level, in comparison with 13  percent statewide. Results from a 2001 California asthma report indicate  that asthmatic adults with family incomes below the national poverty level  are nearly twice as likely to experience symptoms every day or every week  as those with incomes three times the poverty level, in part, because they  have less access to health care.
Finally, residents of Imperial County are currently exposed to airborne  particulate pollution exceeding the Clean Air Act’s health-based National  Ambient Air Quality Standard for PM that was 30 micrograms, or 63 percent higher, than the national  standard of 50 micrograms per cubic meter of air, as shown in table 8. As a  result, Imperial County residents can be expected to have higher incidence  of adverse health effects caused by airborne particulate pollution than  residents living in areas with less of that contaminant.  . However, DOE did not fully  explore these conditions to determine their potential health impacts. DOE  believes that because the increases in emissions from the plants are below  EPA’s significant impact levels any health impacts will be negligible.  However, some health studies have found that even the smallest  incremental increase in particulate matter air pollution increases the  incidence of adverse health effects.
section_title: Health Impacts from Ozone Formation May Be Larger Than Estimated by DOE
paragraphs: DOE conducted air dispersion ozone modeling for the Imperial Valley- Mexicali air basin to determine what impact emissions from the Sempra  and Intergen plants would have on the formation of ozone. DOE  concluded, based on its modeling, that there would be no meaningful  change in ozone levels as a result of the operation of the Sempra and  Intergen power plants. Consequently, DOE concluded that the health  impacts from ozone formation as a result of plant emissions would be  minimal. However, if the modeling is not accurate, then the health impacts  could be larger than DOE estimated.
EPA officials have raised concerns about the accuracy of DOE’s modeling  of estimated ozone increases. In its comments on DOE’s draft  environmental impact statement, EPA stated that it is difficult to quantify  the impact of a small number of facilities (i.e., the two power plants) on  the maximum ozone concentration in an air basin. The lack of area- specific information, such as temperature, relative humidity, and levels of  volatile organic compounds (an ozone precursor), in the Imperial  County-Mexicali air basin makes modeling ozone formation particularly  difficult. Because these data were not available, DOE used surrogate  values from Phoenix, Arizona. Furthermore, DOE’s analysis relied on air  monitoring data and the EPA ozone model to determine the potential  influence of NO emissions—the primary pollutant emitted from the  Sempra and Intergen power plants—on ozone concentrations in Imperial  Valley. DOE concluded that increased NOX emissions from the plants could  produce a decrease in ozone concentrations. In its comments on the draft  environmental impact statement, EPA stated that peak ozone  concentrations generally occur in areas away from sources of high NOX  emissions, not at the monitor where high NOensure that mitigation projects are completed satisfactorily. Finally, DOE  acknowledged in the environmental impact statement that mitigation  measures may be more abundant and cost-effective in Mexico. However,  DOE told us that while it has the authority to require the plants to take  mitigation measures in the United States, it does not have the authority to  require or enforce such measures in Mexico.
section_title: Policymakers Have Limited Options to Ensure That Emissions from the Sempra and Intergen Power Plants Do Not Adversely Affect the Health of Residents in Imperial County
paragraphs: Because the Sempra and Intergen power plants are not subject to either  the federal Clean Air Act or the California Clean Air Act, they are not  required to provide offsets for their emissions. In addition, relevant  agreements among the United States, Canada, and Mexico may not provide  adequate mechanisms to address adverse health impacts resulting from  emissions from these plants. As a result, policymakers have limited  options to ensure that emissions from these plants do not adversely affect  the health of residents in Imperial County.
subsections: section_title: Existing Laws and Agreements May Not Provide Effective Mechanisms to Address Adverse Health Impacts
paragraphs: Existing U.S. law provides few options to ensure that emissions from the  Intergen and Sempra plants do not adversely affect the health of residents  in Imperial County. Because the Intergen and Sempra plants are not  located in the United States, federal and California environmental agencies  do not have authority over the plants. The federal Clean Air Act contains  no language extending the statute’s coverage to pollution sources that are  located outside of the United States. Similarly, the text of the California  Clean Air Act limits its application to pollution sources that are located in  California. Because neither of these laws applies to the Sempra or Intergen  plants, U.S. environmental agencies have no authority under existing law  to require the plants to implement pollution control measures.
Similarly, existing international agreements provide few options to ensure  that emissions from the Sempra and Intergen plants do not adversely  affect the health of residents of Imperial County. The governments of the  United States and Mexico have ratified two agreements that are of  particular importance to environmental conditions in the border region.  The first was signed at La Paz, Mexico, in 1983. The La Paz Agreement  creates a framework for promoting cooperation between the United States  and Mexico on issues of environmental protection in the border region.
For example, the agreement states that the United States and Mexico will  “cooperate in the solution of the environmental problems of mutual  concern in the border area,” and that high officials from the two countries  will meet annually to review the agreement’s implementation. The  agreement does not require either government to implement specific  pollution control requirements or provide a course of action for either  country to pursue if a particular project in the border region harms the  health of border region inhabitants.
The other environmental agreement, the North American Agreement on  Environmental Cooperation (NAAEC), also provides few options to ensure  that emissions from the Sempra and Intergen plants do not adversely  affect the health of residents of Imperial County. The United States,  Canada, and Mexico signed the NAAEC in 1993 to supplement the  provisions of the North American Free Trade Agreement. The NAAEC  provides a dispute resolution procedure under which the United States,  Mexico, or Canada may request consultation with another party to the  agreement regarding whether there has been a persistent pattern of failure  by that other party to effectively enforce its environmental law. The  parties must make every attempt to resolve the matter through the  consultative process. However, if consultation fails to lead to a  satisfactory resolution, then either party may take a series of steps that  may culminate in the meeting of an impartial, five-member arbitration  panel. This panel can determine whether the party complained against has  persistently failed to enforce its environmental law. If the panel issues a  decision finding such a persistent failure, it may formulate an action plan  to remedy the enforcement failure and may ultimately impose monetary  penalties if the enforcement failure persists. Thus, the NAAEC dispute  resolution procedure provides an option for U.S. policymakers, but only if  the Mexican government persistently fails to enforce the Mexican  environmental laws that apply to the two plants. The NAAEC dispute  resolution procedure does not provide a useful option for U.S.  policymakers if the Intergen and Sempra plants comply with Mexican law,  even if the plants adversely affect the health of the residents of Imperial  County.
section_title: Policymakers Have Limited Options to Protect Imperial County Residents from Adverse Health Impacts
paragraphs: There are some actions policymakers could take to protect Imperial  County from increased emissions from the Sempra and Intergen power  plants. For example, the Congress could enact legislation restricting the  importation of electricity generated by power plants whose electrical  output is dedicated exclusively to the United States if they do not meet  certain U.S. emission and offset requirements. While this action would  have benefits to air quality and health, it would also have costs, such as  possibly reducing energy supplies available to southern California. In 2003  a bill was introduced in the Senate and House that would have prohibited  the exportation of natural gas from the United States to Mexico for use in  power plants near the U.S. border if the plants do not provide air quality  protection that is at least equivalent to the protection provided by air  quality requirements applicable in the United States. Each chamber  referred the bill to committee; neither the Senate nor the House committee  reported the bill to the full chamber for consideration.
Similarly, DOE could modify its regulations that apply to applicants for  presidential permit seeking to build new international transmission lines  to import electricity into the United States from Mexico. The modified  regulations could require that the lines connect to plants that employ  specified emissions controls and obtain offsets in the United States.  However, limiting the import of electricity from Mexico into California  could jeopardize some electricity supplies for parts of southern California,  which could be problematic especially during peak consumption periods.  According to the California Independent System Operator, the demand for  energy in California is growing at nearly 4 percent annually. During the  summer of 2004, the peak demand record set in 1999 was broken seven  times, and the California Independent System Operator believes that the  record will likely fall again during the summer of 2005.
Moreover, both of the above options would need to be assessed to  determine if they are compliant with the North American Free Trade  Agreement (NAFTA). The agreement allows either the U.S. or Mexico to  restrict energy imports for a range of reasons, including protection of  human life or health. However, such import restrictions must meet a  variety of conditions. For example, though NAFTA recognizes a country’s  right to license imports and exports of energy, any such licensing system  must be consistent with NAFTA and not frustrate its overall objectives of  eliminating trade barriers, promoting fair competition, and increasing  investment opportunities. NAFTA also requires energy regulatory agencies  to minimize disruptions to contractual relationships in applying their  regulations.
A third option would be for the United States and Mexico to expand  cooperation under the existing binational initiative to address  transboundary air pollution in the U.S.-Mexico border region by providing  economic incentives, such as emissions trading, to reduce pollution. Such  programs have proven successful in the United States in reducing  emissions that contribute to acid rain. At the international level, the United  States and Canada have developed an air pollution agreement that could  possibly serve as a model for a similar agreement between the United  States and Mexico. However, based on the Canadian example, developing  the legal and regulatory framework needed to create a binational  emissions trading program with Mexico is likely to take a significant  amount of time. The United States and Canada initiated cooperative  efforts in 1980 through a memorandum of understanding, and 11 years  later the 1991 U.S.-Canada Air Quality Agreement identified market-based  mechanisms, including emissions trading, as areas for further discussion.  In April 1997, the United States and Canada agreed on a joint plan of  action for addressing transboundary air pollution, expanding the initial  focus on acid rain to also examine ground-level ozone and particulate  matter. In 2000, the Air Quality Agreement was formally expanded to  address transboundary ground-level ozone issues. In 2004, the United  States and Canada initiated a joint study to examine the feasibility of  establishing a binational emissions trading program. Issues being  addressed include the legal authority and the air pollution monitoring,  assessment, and reporting system that would be needed to implement  such a program.
At the state level, Texas passed legislation in 2001 that authorized the  state’s environmental agency to accept reductions in emissions from brick  kilns in Ciudad Juarez, Mexico, to satisfy new state emission control  requirements passed by the Texas Legislature in 1999. In return for air  emission allowances under Texas law, the local utility, El Paso Electric,  arranged the destruction of older, high-polluting, open-top kilns and  replaced them with less polluting closed-top kilns. This emission control  project serves the Paso Del Norte air basin, which is officially recognized  in the La Paz Agreement, and includes El Paso, Texas, and Ciudad Juarez,  Mexico.
Finally, another potential option is the development of a binational clean  air trust fund that could provide grants and loans to support projects that  would improve the air quality of U.S. and Mexican cities that share air  basins in the border region. Implementing such a program could help  offset emissions generated by a variety of sources, including power plants  in Mexico that are not required to offset their emissions. Funds from a  variety of sources, such as appropriations from both nations’ legislatures,  fast-lane fees for cars and trucks at ports of entry, and fees from airports  and railroads operating along the border, could be held in a joint  U.S.-Mexican trust fund for distribution to states, counties, cities, or local  air pollution control districts along the shared border. The binational  clean air trust fund could also potentially obtain funds from power plants  located in the U.S.-Mexico border region that are looking for opportunities  to offset their emissions, although they are not required to do so by law.  Both Intergen and Sempra have shown an interest in supporting projects  aimed at improving the air quality in the border region. For example,  Intergen supports an applied research grant program to improve air quality  in the California–Mexico border region, and Sempra is developing a fund  to support the implementation of environmental projects, such as road  paving, in the border city of Mexicali, Mexico, that it expects to implement  before the end of 2005.
section_title: Conclusions
paragraphs: The Sempra and Intergen plants near Mexicali, Mexico, are modern power  plants that use advanced air pollution control technologies. As a result, the  pollution they emit is comparable to that emitted by similar plants that  have recently received permits to operate in California and is low relative  to dust and emissions from vehicles, the primary sources of pollution in  Imperial County. Nevertheless, the plants emit some pollutants into an air  basin that already does not meet some air quality standards and is home to  many asthmatic children and a low-income population that may be  particularly susceptible to adverse health consequences from any level of  pollution increase. DOE concluded in its environmental impact statement  that pollution from the plants would not result in significant health  impacts in Imperial County and therefore did not require the plants to  offset their emissions. However, the DOE analysis did not fully examine  several issues that could have led to an assessment of a larger adverse  health impact in Imperial County. In addition, if the plants were located 3  miles north in Imperial County, California, they would be required to fund  projects to reduce pollution from other sources to offset their emissions  regardless of whether there was a documented adverse health impact.  However, now that DOE has determined that no offsets are required,  options available to U.S. policymakers in the short term to directly address  the existing health concerns are limited. In the long term, the United States  and Mexico could implement an emissions trading program or a clean air  trust fund to address pollution in the border area, but such programs are  likely to take years, and require significant binational effort to develop.
section_title: Agency Comments and Our Evaluation
paragraphs: We provided draft copies of this report to the Department of Energy  (DOE) and to the Environmental Protection Agency (EPA) for their review  and comment. We received a written response from DOE’s Director, Office  of Electricity Delivery and Energy Reliability. EPA provided technical  comments which we incorporated in the report.
DOE disagreed with our assertion that it did not analyze all of the likely  asthma-related and other health impacts of increased pollution from the  Sempra and Intergen power plants. Specifically, DOE stated that the  environmental impact statement for the two plants (1) notes the full range  of respiratory effects associated with exposure to airborne particulate  matter (PM. While DOE’s environmental impact statement  acknowledges that increases in PMimpact. Moreover, DOE’s analysis does not differentiate among different  population subgroups in terms of their susceptibility to the effects of air  pollution but instead characterizes potential adverse health effects for the  population as a whole. Consequently, we continue to believe that DOE’s  environmental impact statement did not address the full range of potential  health impacts on susceptible populations in Imperial County.
Finally, DOE does not agree that the health impacts from ozone formation  may be larger than it estimated in the environmental impact statement.  DOE said that it addressed EPA’s concerns regarding the uncertainty in  the ozone modeling in the final environmental impact statement. However,  while EPA acknowledged in its comments on the final environmental  impact statement that the document clarified the limitations of the ozone  modeling analysis, it also reiterated its support for off-site mitigation  efforts to address these limitations to ensure that there is no net increase  in air pollution in Imperial County. As a result, we continue to believe that  ozone formation may have larger health impacts than estimated in the final  environmental impact statement. DOE’s specific comments and our  detailed responses are presented in appendix II of this report.
We are sending copies of this report to the Secretary of Energy, and the  Administrator of the Environmental Protection Agency, and appropriate  congressional committees. We will also provide copies 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 or your staffs 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 III.
section_title: Appendix I: Objectives, Scope, and Methodology
paragraphs: The objectives of this report were to determine (1) how emissions from  the Sempra and Intergen power plants compare to emissions from recently  permitted plants in California and emissions from sources in Imperial  County, and what emissions standards the plants would be subject to if  they were located in Imperial County; (2) the health impacts of emissions  from the power plants on Imperial County residents; and (3) what options  exist for U.S. policymakers to ensure that emissions from these power  plants do not adversely affect the health of Imperial County residents. To  address all three of these objectives we visited the Sempra and Intergen  plants in Mexicali, Mexico; interviewed plant representatives, various U.S.  federal, state, and local air quality officials, and other stakeholders; and  reviewed relevant documents and studies.
To determine emissions from the Sempra and Intergen plants we obtained  data from emissions performance tests conducted at the plants by third  party contractors (GE Mostardi Platt and Air Hygiene). These tests were  designed to document the average emissions of selected pollutants  (nitrogen oxide, particulate matter, carbon monoxide, volatile organic  compounds, and ammonia) from the combustion turbines at each of these  plants. The results of these tests were reported in standard units of  measurement, namely parts per million or pounds per hour. According to  the contractors, they completed the tests according to Environmental  Protection Agency and California-approved methods and conducted  quality assurance activities related to their test results. We assessed the  reliability of the data by (1) reviewing documentation of test objectives  and quality control procedures provided by the third party contractors, (2)  conducting interviews with plant officials to determine the scope and  generalizability of the tests, and (3) reviewing reports of actual NOX  emissions submitted to the Mexican government to ensure consistency  with the test results. Based on this assessment, we determined that the  data were sufficiently reliable for the purposes of this report.
To determine annual emissions estimates from these plants, we used the  results from the emissions tests to calculate the annual tonnage that these  plants would be likely to emit. We computed these values based on the  conservative assumption that these plants would be operating 24 hours a  day, 365 days a year. In addition to the estimates obtained from the testing  results, we also used the maximum allowable emission limits of  comparable plants in California to develop a more conservative estimate  of annual emissions from these plants. For Sempra, we utilized the Elk  Hills power plant as the primary basis for developing comparative  estimates. This natural gas-fired power plant is partially owned by Sempra  Energy and utilizes very similar equipment and pollution control  technology as the Mexicali plant. For the Intergen plant, we used a  combination of comparable estimates because no similar, Intergen owned  facilities were recently constructed in California. To estimate nitrogen  oxide (NOX) and ammonia (NH) was estimated using the  average allowable emissions limit from all comparable plants in California  permitted between 2000 and 2004. Because the Intergen plant is not  equipped with an oxidation catalyst, carbon monoxide (CO) was estimated  using a specific plant in California, permitted in 2000, that was the only  one licensed without such control equipment. Finally, because some  California permits establish volatile organic compounds (VOC) limits in  parts per million and others do so in pounds per hour, we were not able to  develop an average for all recently permitted plants in California. For this  reason, we used emissions limits from the Elk Hills power plant to  estimate annual emission levels of VOC at the Intergen plant.
To determine how estimated emissions from the Sempra and Intergen  plants compare to recently permitted plants in California, we developed a  range of maximum allowable emission limits for all natural gas-fired  power plants in California with similar specifications, licensed between  2000 and 2004. This time frame was chosen because it corresponded to the  dates that the Sempra and Intergen plants in Mexicali were designed,  permitted, and began commercial operations. Because all California power  plants are permitted on a case-by-case basis, emissions limits may vary  with each project. Therefore, we used the entire range of emission limits  for the 23 plants that were identified during our selection process. We then  compared the range of emission limits from the 23 plants that we  identified with the third party testing results we obtained from the Sempra  and Intergen plants.
To determine how the emissions from these plants compare to emissions  from sources in Imperial County we utilized the 2004 estimated annual  average emissions inventory for Imperial County developed by the  California Air Resources Board. We also met with officials from the  California Air Resources Board and reviewed emissions reports for  stationary sources obtained from the Imperial County Air Pollution  Control District. To determine the levels of nitrogen oxide emissions from  the Sempra and Intergen plants in relation to existing plants in Imperial  County and Baja California, Mexico, we obtained reports developed for  the Mexican government that included annual emissions of nitrogen  oxides based on data from the continuous emissions monitoring system on  each turbine. Comparable data for the El Centro plant in Imperial County  and the two Baja California plants were obtained from a report produced  by the Commission for Environmental Cooperation of North America. To  assess the reliability of these data sources we (1) spoke with officials at  the California Air Resources Board and reviewed documentation related to  data collection and quality control procedures used to develop the annual  emissions inventory, and (2) corroborated the emissions data related to  the El Centro plant with the EPA Clean Air Markets database. Based on  these assessments, we determined that the data were sufficiently reliable  for the purposes of this report.
To determine what emissions standards the plants would be subject to if  located in Imperial County we reviewed the principal federal regulations  applicable to new power plants located in the United States and the  emission limits of similar plants recently permitted in California. The  primary federal regulations we reviewed were those established under  EPA’s New Source Review program for new or modified major pollution  sources. We reviewed selected state and local air pollution regulations  because state and local agencies have responsibility for implementing  specific permitting activities as part of the federal program. The state and  local regulations we reviewed included the permitting conditions of  several power plants licensed by the California Energy Commission to  determine the standard permitting criteria and the air quality rules  established by the Imperial County Air Pollution Control District for  sources located in Imperial County.
To identify the potential health impacts from emissions generated by the  Sempra and Intergen power plants, we reviewed the health assessment in  DOE’s environmental impact statement. We met with the project manager  of DOE’s health assessment to gather additional information about the  assessment methodology. We reviewed EPA’s comments on the  environmental impact statement, and interviewed EPA officials and health  experts regarding DOE’s health assessment methodology. In addition, we  reviewed relevant EPA reports, and other health studies regarding the  impacts of particulate matter and ozone on human health. Finally, we  reviewed a recent California health survey to obtain current information  on asthmatic populations in Imperial County and other California  counties.
To determine the policy options available to ensure that emissions from  the Sempra and Intergen plants do not adversely affect the health of  Imperial County residents, we reviewed the federal Clean Air Act, the  California Clean Air Act, key provisions of the North American Free Trade  Agreement, as well as environmental agreements between the United  States and Mexico, such as the La Paz agreement, and a trilateral  agreement between the United States, Mexico, and Canada—the North  American Agreement on Environmental Cooperation; and academic  research. We also participated in a transboundary air quality management  conference where officials from various federal, state, and local agencies  in the United States and Mexico met to discuss strategies to address  binational air pollution.
We conducted our work between September 2004 and August 2005 in  accordance with generally accepted government auditing standards.
section_title: Appendix II: Comments from the Department of Energy
subsections: section_title: GAO Comments
paragraphs: The following are GAO’s comments on DOE’s written comments provided  in their letter dated July 29, 2004.  1.  While DOE’s environmental impact statement acknowledges that  increases in PM and ozone because it does not meet air quality standards for these  two pollutants.  2.  Asthma hospitalizations are just one measure of potential adverse  health impacts from increased emissions of particulate matter. While  asthma hospitalizations are more severe and likely to occur less often  than doctor visits or increased medication use for asthma, they cannot  be considered representative of the “full range” of potential adverse  health impacts associated with asthma in Imperial County. In addition  to asthma-related adverse health effects, numerous studies have linked  increased exposure to particulate matter to other non-asthma-related  adverse health effects, such as chronic bronchitis, chronic lung  disease, pneumonia, and cardiovascular disease.  3.  We disagree with DOE that hospitalizations are the best parameter for  representing impacts on asthma. While asthma hospitalizations in  Imperial County may be well documented, the 2003 California Health  Survey provides information on other asthma-related health impacts in  Imperial County. For example, the survey contains information on the  number of Imperial County residents who take medication to control  asthma. In addition, the survey presents information on the number of  Imperial County residents who had asthma symptoms within a  specified time frame and who visited an emergency room or urgent  care facility for asthma-related health problems during that time frame.  Such information could have been used, along with information on  hospitalizations, to create a more complete estimate of the potential  asthma-related health effects from increases in pollution from the  power plants.  4.  The report does not use the health effects pyramid, or suggest it should  be used, to compute instances of potential health effects from air  pollution. However, we believe that the health effects pyramid is useful  for understanding the variety of ways in which increased pollution can  aggravate asthma suffering in Imperial County. In so doing, it also  highlights the full range of potentially quantifiable effects related to  asthma.  5.  During our review of the health effects literature, we identified a  number of studies that support a linear relationship between increases  in particulate matter pollution and increased incidence of  cardiovascular diseases.  6.  Asthmatic children are not the only susceptible population mentioned  in our report, and asthma hospitalization is not the only potential  health impact. Consequently, we continue to believe that DOE’s  environmental impact statement did not address the full range of  potential health impacts on susceptible populations in Imperial  County. DOE’s quantification of just one adverse health impact for the  entire population of Imperial County masks the differential effects that  can beset more susceptible subpopulations in the County.  7.  In commenting on the final environmental impact statement, EPA  acknowledged that DOE had clarified the limitations and uncertainties  of the ozone modeling analysis. However, in its comments EPA said it  continues to support and encourage off-site mitigation efforts to  address the limitations in the ozone modeling to ensure that there is no  net increase of air pollution in Imperial County.  8.  We believe that EPA’s comment regarding peak ozone concentrations  is relevant because it is presented in the context of EPA’s comments  on the draft environmental impact statement. We also note in the  report that DOE took action in response to EPA’s comment.
section_title: Appendix III: GAO Contact and Staff Acknowledgments
subsections: section_title: GAO Contact
section_title: Acknowledgments
paragraphs: In addition to the contact named above, Leo G. Acosta, Charles Bausell,  Nancy Crothers, Brandon Haller, Ryan Lambert, Omari Norman, Kim  Raheb, and Stephen Secrist made key contributions to this report.