Florida Department of Environmental Protection

FDEP Regulatory Updates

Greg DeAngeloFlorida DEP, Division of Air Resource Management

July 30, 2009

Status Updates and Future Projects

• Greenhouse gas cap-and-trade• Ozone nonattainment areas• Clean Air Interstate Rule (CAIR)• New Source Review (NSR) rule• Other upcoming regulations

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Florida's Cap-and-Trade Project

• Drivers for the department’s rulemaking• Governor’s Executive Order 07-127• Florida Climate Protection Act

• § 403.44, Florida Statutes

• Rulemaking process• Initial notice of rule development, July 2007

• Additional notice, May 2009• Five workshops to date, one planned for late

Aug• FECC interaction, ERC hearing, Legislature

http://www.dep.state.fl.us/air/rules/ghg/electric.htm July 30, 2009 | 3

Federal Cap-and-Trade in Development• “Waxman/Markey bill”

• Henry Waxman (D-CA) & Edward Markey (D-MA)• “American Clean Energy and Security Act of 2009”• “H.R. 2454”

• Economy-wide legislation• Cap-and-trade for utilities (and other industries)• CO2 emission standards for new coal power plants• Renewable energy and energy efficiency mandates• Transportation and fuels provisions• Reports, studies, project funding, etc.

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H.R. 2454 Design Features Track Florida

• Federal legislation mirrors many design elements that have been emerging as a consensus opinion during our rulemaking.• Declining cap to reach goals by 2050• Phase-in period with free distribution of

allowances• Split allocation between emissions and

generation• Transition to an auction• Creation of a strategic reserve• Direction of allowance value to energy

efficiency, demand side management, and rate payer relief

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Florida vs. Federal CO2 Caps (proposed)

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Continuing Our Process

• Continue the valuable work• Building consensus• Identifying issues important to Florida• Laying groundwork for influencing federal

rules

• Develop offset policies• Key to early success of cap-and-trade• Methodologies and verification are critical• Many potential biomass-related projects in

Florida

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EPA's New Ozone Standard (March 2008)

• Primary (health)• Secondary (public welfare)

• Both standards set at 0.075 ppm over 8-hours

• Compliance determined via monitoring network• 3-year average of the annual fourth highest

maximum daily 8-hour concentration• If any monitor in a "core based statistical

area" shows ozone greater than 75 ppb, then whole CBSA is presumed to be in nonattainment.

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Ozone Compliance Values, 2006—2008

• Violating CBSA as per the 2006—2008 data• Pensacola• Panama City• Tampa—St. Petersburg—Clearwater• Sarasota—Bradenton—Venice

• EPA to make designations by March 2010• Bay, Sarasota, and Manatee counties on the

cusp• Depends on consideration of 2009 data

http://www.dep.state.fl.us/air/air_quality/new_ozone_standard.htm

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Then What?

• State plan in place by March 2013• Adequacy of current regulations

• CAIR will reduce NOX emissions at coal-fired power plants; most controls will be added by 2010.

• Gasoline vapor emissions rule reduces VOC; it is expanding from 7 counties to statewide by 2010.

• Federal emission and efficiency standards for new cars and trucks will also reduce NOX.• Not reinstating vehicle inspections!

• Determine which regulations are necessary• Statewide NOX and VOC rules likely

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Status of CAIR

• CAIR trading rule is back…for now• EPA working on CAIR replacement rule

• No proposal or schedule yet

• DEP going ahead with orders• Allocating CAIR NOX ozone-season and annual

allowances according to Rule 62-296.470• Populating source accounts at Clean Air

Markets Division• Final orders will be posted

http://www.dep.state.fl.us/air/rules/cair.htm

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CAIR Replacement Rule• Many issues facing EPA:

• How to ensure sufficient upwind emission reductions, without over-control?

• How to determine whether one state significantly contributes to nonattainment in another state?

• What remedies to apply? (Still a role for trading? Expand to cement kilns and industrial boilers?)

• EPA goal:• Adopt legally defensible replacement rule in two years• 2012 is earliest possible year for any resulting benefits• Too late for inclusion in nonattainment SIPs for 1997

standards; may help with 2008 ozone standard

July 30, 2009 | 13

CAIR Implementation in Florida• Proposed order allocating new-unit set-aside

allowances for 2009 issued mid-July• Proposed order re-allocating baseline-unit

allowances for 2009-2012 (August)• Proposed order allocating compliance supplement

pool allowances for 2009 (September)• Proposed order allocating baseline-unit

allowances for 2013-2015 (October)• Requests for ozone-season/annual new-unit set-

aside allowances for 2010 due February/May 2010

July 30, 2009 | 14

CAIR Controls in Florida

• Controls in place or being added during 2009—2010 to coal-fired EGU• SCR or SNCR systems at 24 of 31 units

• 83% of Florida's coal-fired rated generating capacity

• FGD or other SO2 control systems at 25 of 31 units• 88% of Florida’s coal-fired rated generating

capacity

• Large NOX and SO2 reductions expected

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Other Nonattainment Area Rulemaking

• Nonattainment area new source review (NSR)• Need to revise

rules• Add NSR reform

provisions• Previous NSR

reform effort only updated the attainment (PSD) rules

• New national ambient air quality standards (NAAQS)

• New nonattainment area designations• Update standards

and designations to match pending federal ones

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Other Nonattainment Area Rulemaking

• Annual operating report revision• Streamline

reporting requirements for minor VOC and NOX sources

• Create new emissions statement rule; less burdensome alternate

• Revise VOC & NOX RACT rules• Allow transition

period for new nonattainment areas

• Consider statewide applicability

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Other Upcoming Regulations

• Air general permits and exemptions• Convert Title V to non-Title V• Update rules to account for new federal

internal combustion engine (ICE) requirements

• Repeal mercury budget (Clean Air Mercury Rule)• Streamline, clean up, remove obsolete material

• Stay updated at our new web page!

http://www.dep.state.fl.us/air July 30, 2009 | 18

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