Over the past year, there has been increasing congressional interest in steps being taken by the Environmental Protection Agency (EPA) to address emissions of greenhouse gases (GHGs). During that time, EPA has promulgated rules to (1) require reporting of GHG emissions by stationary sources that emit 25,000 tons or more of carbon dioxide equivalents (CO 2 e); (2) set GHG emission standards for light duty motor vehicles (cars, minivans, SUVs, and light trucks); and (3) address several issues related to permit requirements for stationary sources of GHGs. Stationary sources—a term that includes electric power plants, petroleum refineries, manufacturing facilities, and other non-mobile sources of air pollution—have not yet been subject to any GHG emission standards issued by EPA; but because of the Clean Air Act's wording, such stationary sources will become subject to permit requirements for their GHG emissions beginning on January 2, 2011. Among the sources likely to be affected by implementation of the Prevention of Significant Deterioration (PSD) permit requirements are new and modified electric generating units of all kinds, but particularly those fired by coal. These sources emit substantially more than EPA's threshold of 100,000 metric tons of CO 2 annually: for example, a 500 megawatt (MW) coal-fired baseload power plant would emit on the order of 3 million metric tons of CO 2 annually. The coal mining industry and coal-fired electric utilities face at least half a dozen major regulatory actions over the next few years; industry supporters view these rules collectively as a significant threat to the future of coal. Viewed in this context, the PSD permit requirement is one more nail in what increasingly appears to them as coal's future coffin. Of particular concern is Section 165's requirement that PSD permits require new and modified major sources to install the Best Available Control Technology (BACT) for each pollutant subject to regulation under the act. This report reviews the development of EPA's November 10, 2010 GHG BACT guidance and discusses the elements of the guidance, with particular attention to their potential impact on coal-fired electric generating units. "the proposed facility is subject to the best available control technology for each pollutant subject to regulation under this Act emitted from, or which results from, such facility." (Section 165(a)(4)) Under Sections 165-169 of the Clean Air Act, any new or modified facility emitting (or potentially emitting) over 100 or 250 tons of any regulated pollutant must undergo preconstruction review and permitting. This process, called New Source Review (NSR), has four major requirements: Best Available Control Technology (BACT) —determining the emissions limitation that will achieve the maximum degree of emissions reductions through application of production processes and available methods, systems, and techniques, taking into consideration energy, environmental and economic impacts. Air Quality Analysis —assessing existing ambient concentrations of air pollutants and modeling anticipated pollutant concentrations resulting from the proposed or modified project and from future growth associated with the project. Impact Analysis —assessing the air, ground, and water pollution impacts on soils, vegetation, and visibility from pollutant increases projected to result from the proposed or modified project. Public Involvement —providing opportunities for public involvement during the permit process, including hearings and appeals. BACT is determined by state permitting agencies on a case-by-case basis, taking into account a proposed control measure's energy, environmental, and economic impacts. BACT cannot be less stringent than the federal New Source Performance Standards (NSPS), but it can be more so. EPA issues guidance to states to assist them in making BACT determinations. Greenhouse gases will be subject to regulation beginning on January 2, 2011, when the emission standards for light duty motor vehicles take effect. Thus, as of that date, new and modified major stationary sources of greenhouse gases will require permits for construction and operation. As noted above, major stationary sources are defined in the statute as those that have the potential to emit more than 100 tons or 250 tons of pollutants subject to regulation annually. For greenhouse gases, this is a relatively low threshold: EPA has estimated that more than six million existing stationary sources emit 100 tons or more of GHGs annually. The agency estimates that currently about 280 sources have required PSD permits annually, and that a 100/250 ton threshold for GHGs would increase that number by 140-fold. EPA argues that expanding the PSD permit program 140-fold would pose an extraordinary burden on itself and state permitting authorities, in addition to the burden it would pose for the regulated emission sources. The agency has sought to limit this burden through a priority-setting regulation called the "Tailoring Rule." (The rule would limit the reach of both the PSD permitting program as well as the broader permit requirement for existing sources of GHGs under Title V of the act.) Faced with what it considers the "absurd results" of following the letter of the law, EPA in September 2009 proposed that the agency and state permitting authorities would, out of "administrative necessity," focus first on the largest facilities. As proposed, the Tailoring Rule would initially have limited the PSD and Title V permit requirements to facilities that emit more than 25,000 metric tons per year of carbon dioxide (or its equivalent in other GHGs). In the final version of the rule, the threshold was increased to 75,000 metric tons for sources that were otherwise subject to permit requirements, or 100,000 tons if the source's emissions of other pollutants would not be sufficient to require a permit. To assist states in making BACT determinations, EPA has provided a recommended procedure for states to use and guidance with respect to acceptable methodologies and requirements in making a determination. In addition, EPA reviews state determinations for BACT and hears appeals from parties dissatisfied with the state's determination. The EPA procedure for determining BACT (required for federally run programs, encouraged for EPA-approved, state-run programs) is a fairly straightforward "top-down" process. The overall presumption of the process is that the measure that results in the maximum reduction in the pollutant should be installed unless energy, environmental, and economic impacts of that choice justify its rejection. The five-step process, as used by EPA is as follows: 1. Identify Available Control Options —there are at least five categories of control options that states can review in identifying possible BACT in an individual case: (a) existing control technologies for sources of that type; (b) technically feasible options that are used on other source categories, but not the one under review; (c) innovative control technology that has never been commercially demonstrated ( inclusion not required ); (d) inherently lower polluting production processes, fuels, and coatings that can be evaluated alone or in combination with other control devices; and (e) specific design or operational parameters that may include such factors as combustion control techniques. These categories of options are not mutually exclusive. As stated by EPA in its guidance: "Combinations of inherently lower-polluting processes/practices (or a process made to be inherently less polluting) and add-on controls are likely to yield more effective means of emission control than either approach alone." Data for control options include EPA's BACT/LAER Clearinghouse, existing EPA or state permits, equipment vendors, trade associations, permitting engineers, and technical papers and journals. 2. Eliminate Technically Infeasible Control Options —control options need to be either demonstrated on a like facility or determined to be both available and applicable in the particular case. If not, the option is eliminated from the list. 3. Rank Remaining Options Based on Pollutant Reduction —a variety of performance metrics may be necessary to determine comparative control efficiencies among different options. 4. Eliminate Options that F ail Energy, Environmental, or Economic Criteria —the permitting agency has discretion in weighting the three statutory criteria for exclusion. 5. Determine BACT —the most effective option remaining after the steps above have been taken is determined to be BACT and the permitting agency establishes a corresponding emissions limit. A substantial record is built during the NSR process. A completed permit application is reviewed not only by the permitting agency, but also by the Regional EPA office, Federal Land Managers (if a PSD Class I area is involved), and by the public. Conflicts among these parties and the applicant can send the permit application through a series of state and federal administrative appeals processes, along with state and federal litigation. The specifics on this process vary from state to state. EPA provides guidance to the states in determining BACT by identifying appropriate methodologies and requirements to assist the states in identifying all potential BACT options and in eliminating options that don't meet statutory criteria. Much of the discussion about EPA's guidance for GHG BACT has focused on coal-fired power plants. Coal-fired electric generating facilities are responsible for about 28% of the country's total greenhouse gas emissions. As noted, in general, there are five categories of control options that are considered in a BACT analysis: A review of the categories of GHG control options for coal-fired facilities reveals few readily available alternatives to significantly reduce emissions. 1. Existing Control Technology : a technology proven to work for the particular source category being permitted. There are no existing add-on technologies to reduce carbon dioxide emissions from coal-fired facilities. 2. Technically Feasible Technology : a technology proven to work for other source categories, but not demonstrated on the particular source category being permitted. While an argument could be made that capture technology is commercially available for industrial facilities (to separate carbon dioxide from a facility's other emissions), there is no such available technology with respect to the storage of any captured carbon dioxide. It is possible in some cases that the carbon dioxide could be piped to a facility needing carbon dioxide (such as an oil field using enhanced oil recovery (EOR)), but those opportunities would be very site-specific. 3.