Presenting a live 90‐minute webinar with interactive Q&A New EPA Guidance on Greenhouse Gas Permitting Implementation Strategies to Ensure Compliance with GHG Requirements T d ’ f l f 1pm Eastern | 12pm Central | 11am Mountain | 10am Pacific TUESDAY, JANUARY 11, 2011 T oday’ s faculty features: Kevin Poloncarz, Partner, Bingham McCutchen, San Francisco Peter S. Glaser, Partner, Troutman Sanders LLP, Washington, D.C. The audio portion of the conference may be accessed via the telephone or by using your computer's speakers. Please refer to the instructions emailed to registrants for additional information. If you have any questions, please contact Customer Service at 1-800-926-7926 ext. 10.
Transcript
Presenting a live 90‐minute webinar with interactive Q&A
New EPA Guidance on Greenhouse Gas PermittingImplementation Strategies to Ensure Compliance with GHG Requirements
Kevin Poloncarz, Partner, Bingham McCutchen, San Francisco
Peter S. Glaser, Partner, Troutman Sanders LLP, Washington, D.C.
The audio portion of the conference may be accessed via the telephone or by using your computer's speakers. Please refer to the instructions emailed to registrants for additional information. If you have any questions, please contact Customer Service at 1-800-926-7926 ext. 10.
Continuing Education Credits FOR LIVE EVENT ONLY
For CLE purposes, please let us know how many people are listening at your location by completing each of the following steps:
• Close the notification box
• In the chat box, type (1) your company name and (2) the number of attendees at your location
• Click the blue icon beside the box to send
Tips for Optimal Quality
S d Q litSound QualityIf you are listening via your computer speakers, please note that the quality of your sound will vary depending on the speed and quality of your internet connection.
If the sound quality is not satisfactory and you are listening via your computer speakers, you may listen via the phone: dial 1-866-258-2056 and enter your PIN when prompted Otherwise please send us a chat or e mail when prompted. Otherwise, please send us a chat or e-mail [email protected] immediately so we can address the problem.
If you dialed in and have any difficulties during the call, press *0 for assistance.
Viewing QualityTo maximize your screen, press the F11 key on your keyboard. To exit full screen, press the F11 key againpress the F11 key again.
EPA Guidance on Greenhouse Gas PermittingPermittingUtilizing Implementation Tools to Ensure Compliance with New Requirements
Strafford Publications, Legal Publishing Group January 11, 2011
Kevin PoloncarzKevin PoloncarzBingham McCutchen LLPSan Francisco, [email protected]
EPA Guidance on GHG PermittingEPA Guidance on GHG PermittingOverview
R l ti f GHG U d th Cl Ai A t• Regulation of GHGs Under the Clean Air Act • GHG Permitting Guidance• Strategies for Complying• Strategies for Complying
6
EPA Guidance on GHG PermittingEPA Guidance on GHG PermittingRegulation of GHGs Under the Clean Air Act
• April 2 2007: Massachusetts v EPA 549 U S 497 (2007)• April 2, 2007: Massachusetts v. EPA, 549 U.S. 497 (2007).• Endangerment and Cause or Contribute to Findings for Greenhouse Gases
Under Section 202(a) of the Clean Air Act, 74 Fed. Reg. 66,496 (Dec. 15, 2009)
• Endangerment Finding: The current and projected atmospheric concentrations of the six key well-mixed GHGs – carbon dioxide (CO2), methane (CH4), nitrous oxide (N2O), hydrofluorocarbons (HFCs), perfluorocarbons (PFCs), and sulfur hexafluoride (SF6) – may reasonably be anticipated to endanger public health and welfare of current and future generationswelfare of current and future generations
• Cause or Contribute Finding: The combined emissions of these GHGs from new motor vehicles and new motor vehicle engines contribute to the GHG air pollution that endangers public health and welfare.
7
EPA Guidance on GHG PermittingEPA Guidance on GHG PermittingRegulation of GHGs Under the Clean Air Act
• Interpretation of Regulations that Determine Pollutants Covered by Clean Air• Interpretation of Regulations that Determine Pollutants Covered by Clean Air Act Permitting Programs, 75 Fed. Reg. 17,004 (Apr. 2, 2010)
• Affirmed the interpretation that “subject to regulation” for PSD permitting requirements includes only those pollutants subject to regulations that require actual control of emissionsactual control of emissions.
• Clarified that the date that a pollutant becomes “subject to regulation” is the date that a regulation “takes effect” (rather than upon promulgation or the legal effective date of the regulation containing such a requirement)
• PSD permitting requirements would be triggered on January 2 2011 the earliestPSD permitting requirements would be triggered on January 2, 2011, the earliest date that model year 2012 vehicles meeting the GHG light-duty vehicle standards could be sold in the U.S.
• Light-Duty Vehicle Greenhouse Gas Emission Standards and Corporate Average Fuel Economy Standards; Final Rule, 75 Fed. Reg. 25,324 (May 7,Average Fuel Economy Standards; Final Rule, 75 Fed. Reg. 25,324 (May 7, 2010)
• Go into effect with model year 2012 and push NHTSA’s corporate average fuel economy (CAFE) standards passenger cars, light-duty trucks, and medium-duty passenger vehicles to a fleetwide average of 30.1 miles per gallon (mpg) in 2012,
8
p g g p g ( pg)to 35.5 mpg in 2016, with corresponding CO2 emissions limits (in grams per mile)
EPA Guidance on GHG PermittingEPA Guidance on GHG PermittingRegulation of GHGs Under the Clean Air Act
Tailoring RuleTailoring Rule• Prevention of Significant Deterioration and Title V Greenhouse Gas Tailoring
Rule; Final Rule, 75 Fed. Reg. 31514 (Jun. 3, 2010)• According to EPA, the Tailoring Rule is necessary because, without it, PSD and
Title V requirements would apply at the statutory 100 and 250 tons per year (tpy) levels as of January 2, 2011, triggering a need for agencies to issue tens of thousands of PSD permits and millions of Title V permits.
• Relies upon judicial doctrines of ‘‘absurd results,’’ ‘‘administrative necessity,’’ and ‘‘one step at a time’’one step-at-a-time .
• Step 1: From January 2, 2011 to June 30, 2011, PSD or Title V requirements will apply to a source’s GHG emissions only if the source is subject to PSD or Title V anyway due to its non-GHG pollutants.
• For these so-called “anyway” sources, the applicable requirements of PSD, most notably, the BACT requirement, will apply to projects that increase net GHG emissions by at least 75,000 tpy total GHGs (on a CO2e basis) (and 0 tpy mass for modifications), but only if the PSD requirement is triggered by a non-GHG pollutant.
9
pollutant. • For Title V, only existing sources with, or new sources obtaining, Title V permits for
non-GHG pollutants will be required to address GHGs.
EPA Guidance on GHG PermittingEPA Guidance on GHG PermittingRegulation of GHGs Under the Clean Air Act
Tailoring Rule (cont’d)Tailoring Rule (cont d)• Step 2: From July 1, 2011 to June 30, 2013, PSD permitting requirements will
apply for the first time to new construction projects that emit GHGs of at least 100,000 tpy (even if a project’s emissions do not exceed the permitting th h ld f th ll t t) d t th t it h ththresholds for any other pollutant) and to sources that emit or have the potential to emit at least 100,000 tpy CO2e and that undertake a modification that increases net GHG emissions by at least 75,000 tpy CO2e and 0 tpy mass.
• For Title V, new sources and existing sources not already subject to Title V that emit at least 100,000 tpy CO2e will become subject to Title V requirements.
• According to EPA estimates, approximately 900 additional PSD permitting actions and 550 Title V permitting actions will be required
• Sources less than 50,000 tons of GHGs per year on a CO2e basis will not be required to obtain permits for GHGs before 2016.
10
EPA Guidance on GHG PermittingEPA Guidance on GHG PermittingRegulation of GHGs Under the Clean Air Act
Tailoring Rule (cont’d)Tailoring Rule (cont d)• Step 3: Another rulemaking to begin in 2011 and conclude by July 1, 2012
that may subject smaller sources to permitting requirements beginning July 1, 2013.
• Not include sources with emissions below 50,000 tpy CO2e and modifications with net GHG increases of 50,000 tpy CO2e before April 30, 2016
• EPA also committed to: • Complete a study by April 30, 2015, to evaluate status of PSD and title V p y y p , ,
permitting for GHG-emitting sources, including progress in developing streamlining techniques; and
• Complete further rulemaking based on that study by April 30, 2016, to address smaller sources.
11
State Law ProblemState Law Problem
• 43 States (and/or localities within these t t ) d i i t th i PSDstates) administer their PSD programs
through SIPs – these programs are authorized under state law and approved by EPAby EPA.
• As of mid-2010, the laws of 13 SIP-approved states did not authorize GHGapproved states did not authorize GHG regulation.
Th l f t ( b ll) f th SIP• The laws of most (maybe all) of these SIP-approved states require PSD permits for sources that potentially emit above the CAA 100/250 tpy thresholds
12
CAA 100/250 tpy thresholds.
12
For the13 States that Do Not G GAuthorize GHG Regulation:
• According to EPA unless these laws were• According to EPA, unless these laws were changed by 1/2/11, there will be a construction ban on facilities potentially emitting above the Tailoring Ruleemitting above the Tailoring Rule thresholds.
• Because federal law (the Tailoring Rule) will bar construction unless these facilities obtain a permit requiring GHG BACT p q gcontrols, but state law will prohibit the permitting agency from issuing such a permit.
13
p
13
For States With Regulatory /Thresholds at 100/250 Levels:
• When GHGs become regulated pollutants onWhen GHGs become regulated pollutants on 1/2/11, 100/250 tpy permitting thresholds under state law that apply to other pollutants will automatically become effective for GHGs.
• Unless these states increase their thresholds to the Tailoring Rule levels, numerous small sources will b bj t t PSD l ti d GHG BACTbecome subject to PSD regulation and GHG BACT, creating the permitting gridlock – the “absurd result” - that the Tailoring Rule was designed to avoid.
• Because the Tailoring Rule does not automatically change the state law thresholds.
1414
Timing Problem for Changing SState Law
• EPA did not begin addressing this problem until after Tailoring Rule was adopted in 6/10.
• Not enough time for states to push through law changes through notice-and-commentlaw changes through notice-and-comment rulemaking or legislative action and for EPA to then approve revised SIPs reflecting the changed lawsreflecting the changed laws.
1515
The Regulatory Stampede
• In order to conform state and federal laws in the manner EPA wants by 1/2/11:- In December, EPA issued 7 rules, i l di 6 th d b f th Xincluding 6 on the day before the Xmas holiday that totaled 544 pages and that were published in the Federal Register on 12/29 and 12/30.- Virtually every state in the union has been galloping through rulemakings since midgalloping through rulemakings since mid-to late-2010 to fix the state law problems, many acting under emergency authority.
1616
The Regulatory Stampede: C l i (f )Conclusion (for now)
• 8 States became subject to FIPs as of 1/2/11, including Texas which is resisting Terms of FIPs (delegationTexas, which is resisting. Terms of FIPs (delegation agreements, dual permitting still to be resolved).
• 5 states are subject to continuing SIP Call to change their laws to authorize GHG regulation at specified times in firstlaws to authorize GHG regulation at specified times in first half of 2011. Currently effective construction ban in these states for sources emitting CO2e above Tailoring Rule thresholds.
• Some states have not yet changed their thresholds to the Tailoring Rule levels and/or received EPA approval of SIP revisions. Some sources in these states may be in violation of CAA permitting requirements.p g q
• Major unresolved legal questions as to the validity of EPA’s process for requiring and then approving SIP revisions.
17
e s o s
17
EPA Guidance on GHG PermittingEPA Guidance on GHG PermittingGHG Permitting Guidance
• PSD Applicability: Calculating CO2e based and mass based emissions• PSD Applicability: Calculating CO2e-based and mass-based emissions• Biomass: Forthcoming guidance and potential rulemaking• BACT Analysis• Other PSD Requirements, e.g., whether GHG impacts need to be assessed as q , g , p
part of Class I or additional impacts analyses• Title V considerations• Appendices
A li bilit Fl Ch t d C l l ti E l• Applicability Flow Charts and Calculation Example• BACT Examples: Natural Gas Boiler, Municipal Sold Waste Landfill and Petroleum
• Available at: http://www.epa.gov/nsr/ghgdocs/epa-hq-oar-2010-0841-0001.pdf
• EPA published notice announcing that the guidance is now in effect and requesting
18
p g g q gpublic comment by December 1, 2010.
• 75 Fed. Reg. 70,254 (Nov. 17, 2010).
EPA Guidance on GHG PermittingEPA Guidance on GHG PermittingWhite Papers, Technical Guidance & Training
• EPA also issued seven technical “white papers” focusing on how to conduct GHG• EPA also issued seven technical white papers focusing on how to conduct GHG BACT analyses in the following common source categories:
• Coal-fired electric generating units• Large industrial/commercial/institutional boilers
P l d f t i• Pulp and paper manufacturing• Cement manufacturing• Iron and steel industry• Petroleum refineries• Nitric acid plants• Available at: http://www.epa.gov/nsr/ghgpermitting.html
• Expansion of Control Technology Clearinghouses • Enhancements to RACT/BACT/LAER Clearinghouse (http://cfpub epa gov/RBLC/)• Enhancements to RACT/BACT/LAER Clearinghouse (http://cfpub.epa.gov/RBLC/) • GHG Mitigation Strategies Database: to track cost and availability information for a
number of emerging GHG-control technologies; available at: http://ghg.ie.unc.edu:8080/GHGMDB/
• Training available at: http://www epa gov/apti/broadcast html#GHGTraining1210
19
Training available at: http://www.epa.gov/apti/broadcast.html#GHGTraining1210
EPA Guidance on GHG PermittingEPA Guidance on GHG PermittingGHG Guidance
CAAAC Cli t Ch W k G• CAAAC Climate Change Work Group Recommendations
• Interim Phase I Report of the Climate Change Work Group of the Permits, New Source Review and Toxics Subcommittee, Feb. 3, 2010
20
EPA Guidance on GHG PermittingEPA Guidance on GHG PermittingGHG Permitting Guidance: BACT
R it t EPA’ 5 t “t d ” th d d• Reiterates EPA’s 5-step “top-down” method and explains how should be applied to GHGs• Step 1: Identify all available control technologiesp y g• Step 2: Eliminate technically infeasible options• Step 3: Rank remaining options by emissions control
ff tieffectiveness• Step 4: Evaluate economic, energy and other
environmental impactsp• Step 5: Select best option as BACT for the source
21
EPA Guidance on GHG PermittingEPA Guidance on GHG PermittingGHG Guidance: BACT
R it t th t BACT i b• Reiterates that BACT is case-by-case• Does not prescribe BACT for any source category• Affirms permitting authority’s discretionAffirms permitting authority s discretion• Emphasizes importance of detailed case- and fact-
specific record justifying permitting decisions• Focuses on reductions within fence-line, but with
consideration of other reductions at Step 4 collateral impacts analysis
• Emphasizes Importance of Energy Efficiency• Not only for GHGs, but other regulated NSR
ll t t ll
22
pollutants as well
EPA Guidance on GHG PermittingEPA Guidance on GHG PermittingGHG Guidance: BACT
S f BACT A l• Scope of BACT Analyses• New sources: can consider entire facility• Existing sources: only those units that have been g y
modified or added to an existing facility• Because secondary emissions not part of BACT
analyses, reductions in demand from grid not y , gincluded in Step 1, but may be considered later at Step 4
23
EPA Guidance on GHG PermittingEPA Guidance on GHG PermittingGHG Guidance: BACT
St 1 Id tif All A il bl C t l O ti• Step 1: Identify All Available Control Options• Not only those existing for source category, but
controls available through “technology transfer” g gy• Inherently Lower-Emitting Processes, Practices and Designs• Add-on Controls• Combinations of the above
NSPS fl f BACT• NSPS as floor for BACT • NSPS settlement
• EPA will sign Subpart Da proposal for EGUs standards of performance (111(b)) and emissions guidelines (111(d)) by July 26, 2011; EPA will sign final rule by May 26, 2012; 75 Fed. Reg. 82,392 (Dec. 30, 2010).
• EPA will sign petroleum refineries standards and emissions guidelines by December 10, 2011, with final signed by November 10, 2012; 75 Fed Reg 82 390 (Dec 30 2010)
24
Fed. Reg. 82,390 (Dec. 30, 2010).
EPA Guidance on GHG PermittingEPA Guidance on GHG PermittingGHG Guidance: BACT
St 2 Eli i t T h i ll I f ibl O ti• Step 2: Eliminate Technically Infeasible Options• Control option is technically feasible if it is demonstrated in practice or
available and applicable.• “Demonstrated” means has been installed and operated on same type of source• Demonstrated means has been installed and operated on same type of source.• “Available” means it can be obtained through commercial means.• “Applicable” means it can reasonably be installed and operated on the source
under consideration.Sh ld t b li i t d l l b f i bilit t bt i d• Should not be eliminated solely because of inability to obtain vendor guarantee
• CCS: three components: CO2 capture and compression, transport and storage
• May be eliminated if three components working together are technically infeasible for source, taking into account integration with facility and site-specific considerations, e.g., space for equipment, rights of way to access existing pipeline, access to suitable geological reservoirs.
25
EPA Guidance on GHG PermittingEPA Guidance on GHG PermittingGHG Guidance: BACT
St 3 R k C t l b O ll Eff ti• Step 3: Rank Controls by Overall Effectiveness• Metrics for ranking should best represent array of control alternatives.
• It may be appropriate to rank using output-based metrics to assure that thermal efficiency is adequately reflected for all components of new sourcesthermal efficiency is adequately reflected for all components of new sources.
26
EPA Guidance on GHG PermittingEPA Guidance on GHG PermittingGHG Guidance: BACT
St 4 E i E & E t’l I t• Step 4: Economic, Energy & Envt’l Impacts• Typically used to eliminate more stringent controls with significant or unusual
impacts, in favor of less effective control with more acceptable economic, energy or environmental impactsgy p
• Existing approach for cost-effectiveness analysis is appropriate, but it is reasonable to anticipate that the cost effectiveness numbers, in $/ton of CO2e, will be significantly lower than for previously regulated pollutants.
• Less than $5 000/ton; but where between $1 and $1 000/ton?Less than $5,000/ton; but where between $1 and $1,000/ton? • EPA recognizes that at present CCS is an expensive technology and costs
associated with capture and compression will generally make price of power from CCS-equipped plants uncompetitive.
• “we except that CCS will often be eliminated from consideration in Step 4 of• we except that CCS will often be eliminated from consideration in Step 4 of the BACT analysis, even in some cases where underground storage of the capture CO2 near the power plant is feasible.”
• But may be cases where economics are more favorable, e.g., enhanced oil recovery.
27
y
EPA Guidance on GHG PermittingEPA Guidance on GHG PermittingGHG Guidance: BACT
St 5 S l t BACT• Step 5: Select BACT• Should default to most effective control not eliminated at Step 4;• But in setting BACT limit, permitting authority can consider range of factors.
P itti th it i ibl f d fi i BACT li it d ki th• Permitting authority is responsible for defining BACT limits and making them enforceable as practical matter and for fully justifying BACT decision in permit record.
• Net output-based limits• Focus on longer-term averages (30- or 365-day rolling average), rather than
short-term averages, since environmental concern is with cumulative impacts• May require use of work practices such as energy efficiency environmental
management system where technically impractical to measure emissions and apply an output-based standard.
28
Guidance – Major IssuesGuidance Major Issues
Redefining the Sourceg
• BACT has historically not been interpreted to require a fundamental redesign of the facility proposed Thefundamental redesign of the facility proposed. The applicant defines what type of facility it wants to build; BACT is an add-on control or a process improvement that reduces emissions from the proposed facility.
• EPA and EAB have been chipping away at this understanding.
• BACT Guidance has an on-the-one-hand, on-the-other-hand approach to redefining the source that leaves the matter a muddle.
2929
On the One Hand:Applicant Can’t Be Required toApplicant Can t Be Required to
Redesign its Facility
P i i h i i h ld “l k fi h h• Permitting authorities should “look first at … how the applicant defined its goal, objectives, purpose or basic design for the proposed facility …” and then “discern which design elements are inherent for the applicant’s purpose and which design elements may be changed topurpose and which design elements may be changed to achieve pollutant emissions reductions without disrupting the applicant’s basic business purpose.”
• This “framework” is “ultimately a question of degree ” so• This framework is ultimately a question of degree, so Applicant must fully document its business purpose. “Any decision to exclude an option on ‘redefining the source’ grounds must be explained and documented in the permit record, especially where such an option has been p y pidentified as significant in public comments.”
3030
On the One Hand:Maybe Applicant Can Be Required toMaybe Applicant Can Be Required to
Redesign its Facility
EPA h i “d i h CAA hibi• EPA states that it “does not interpret the CAA to prohibit fundamentally redefining the source and has recognized that permitting authorities have the discretion to conduct a broader BACT analysis if they desire.”
• Thus, states may consider and require fundamental changes to the design of a proposed facility in the BACT analysis.
• Although many states will not want to allow for redefining the source, some states may wish to exercise this discretion.
• This increases complexity of GHG permitting for applicants, creates more uncertainty as to ultimate outcome, and could lead to controversy and delay.
3131
Guidance – Major IssuesGuidance Major IssuesFuel-Switching, Particularly for Coal-Fueled EGUs
(Clean Fuels)
• On the one-hand, “permitting authorities can show in most cases that the option of using natural gas as a primary fuel would fundamentally redefine a coal-fired electric generating facility ”generating facility.
• On the other hand, EPA says states have discretion to require fuel-switching, so long as that decision is fully documented in the top down BACT analysisdocumented in the top-down BACT analysis.
• And switching from one type of coal to another (lower CO2-emitting) coal is not fuel-switching.
• Much of the controversy in the PSD program has been as to coal plants. At present, not many new ones in pipeline. Key issue is how this will play out as to modifications. Environmental community may argue that when existing
32
Environmental community may argue that when existing coal plant modifies, it should be required to switch to gas.
32
Guidance – Major IssuesGuidance Major IssuesCCS as BACT
• On the one-hand, EPA discounts CCS as BACT:
“EPA recognizes the significant logistical hurdles th t th i t ll ti d ti f CCS tthat the installation and operation of a CCS system presents and that sets it apart from other add-on controls that are typically used to reduce emissions of other regulated pollutants and already have an
i ti bl ibl i f t t iexisting reasonably accessible infrastructure in place to address waste disposal and other offsite needs.”
• And EPA says that to be selected as BACT, CCS must be demonstrated to be technically feasible and cost-effective in all three steps of the CCS process—capture/compression transportation and
33
process capture/compression, transportation and storage.
33
Guidance – Major Issuesj
CCS as BACT
• On the other hand, EPA says CCS must be included at step one, which should not be the case because CCS is not in use in the U.S. except in very limited situations Given that CCS is includedvery limited situations. Given that CCS is included in step one, a fairly detailed analysis will be needed to exclude it in steps two and three.
A d EPA t t th t “[ ]hil CCS i i i• And EPA states that “[w]hile CCS is a promising technology, EPA does not believe that at this time CCS will be a technically feasible BACT option in certain cases” (emphasis supplied). This statement
k it if CCS b l t d i ifmakes it seem as if CCS may be selected in many if not a majority of cases.
3434
Guidance – Major Issuesj
CCS as BACT
• Moreover: “in cases where it is clear that there are significant and overwhelming technical (including logistical) issues associated with the application of CCS for the type of source under review (e gCCS for the type of source under review (e.g., sources that emit CO2 in amounts just over the relevant GHG thresholds and produce a low purity CO2 stream) a much less detailed justification may be appropriate and acceptable for the source ”be appropriate and acceptable for the source.
• This statement makes it seem as if the only or primary instance in which a detailed CCS analysis is
t i d i h it l l ti lnot required is where sources emit only relatively small amounts of CO2 and produce a low purity CO2 stream, whereas CCS should be excluded in a much greater number of cases.
35
Guidance – Major IssuesGuidance Major Issues
BACT as Including “Outside the Fence” R i t ?Requirements?
• Guidance: Scope of BACT for existing facilities: only those units that have been modified Scope ofonly those units that have been modified. Scope of BACT for new facilities is entire facility.
• But: Coal EGU White Paper discusses combined pheat and power and coal drying at mine as possible BACT.
→ Requiring off site activity would be a major→ Requiring off-site activity would be a major expansion of BACT with no certain limits. EPA’s New Source Review Workshop Manual says that BACT includes either add-on controls to the emitting unit or inherently lower emitting processes or
36
unit or inherently lower-emitting processes or practices.
Coal-Fired EGU White PaperCoal Fired EGU White Paper
• Also remarkably uninformative.
• Primary focus is on efficiency, but mostly on new units, and provides no information industry does not already know.y
• Very little on the main event for coal EGUs for the foreseeable future, which is what efficiency will be required for existing units when they modify Manyrequired for existing units when they modify. Many different types of coal plants in U.S. of many different ages, raising a host of issues as to what types of efficiency improvements are cost-effective and can be considered as BACT EPA’s Whiteand can be considered as BACT. EPA s White Paper doesn’t help.
• Coal-switching
37
g
EPA Guidance on GHG PermittingEPA Guidance on GHG PermittingGHG Guidance: BACT
St t i f C l i• Strategies for Complying • Work with project team from very beginning to appropriately define the scope
of the project• Be sure that business justification is consistently articulated in all project• Be sure that business justification is consistently articulated in all project
documents• Create robust record for all determinations of project definition, technical
feasibility, ranking of controls and any basis for eliminating due to cost, energy or environmental considerationsenergy or environmental considerations
• Assure that efficiency metric translated into achievable limit, given anticipated degradation expected over maintenance cycles
38
Thoughts on Meeting the New Requirements
1. Justify everything (10 words are better than 1)
Need extensive discussion of what your business purpose is and why you need to build this particular facility.p y
Need to justify your fuel choice as intrinsic to the facility.
Need very wide-ranging discussion of efficiency at all levels of facility. Expect opponents to go through your facility item-by-pp g g y y yitem.
Bill Becker (head of NACAA): “"For the first time in history " Becker says "EPA will require that facilities
39
history, Becker says, EPA will require that facilities go through a process of examining every piece of their operations and take actions to improve energy efficiency.”
Thoughts on Meeting the New Requirements
2. Politics matter more than ever
Broad discretion in states to redefine source if they wish means that states may be urged by activists to engage in wholesale re-engineering g g g gof proposed facilities based on broad social goals.
That is a political argument that some state That is a political argument that some state agencies may be receptive to more than others. On big issues like this, staff will look to political appointees to make the call, and Board/Commission may need to weigh inBoard/Commission may need to weigh in.
40
Thoughts on Meeting the New Requirements
3 Work with staff to create reasonable boundaries3. Work with staff to create reasonable boundaries
Given broad discretion to states, agencies may be urged to consider so many factors in BACT
l i th t ill danalysis that process will never end.
A line must be drawn somewhere to keep the process moving. But keep point one above inprocess moving. But keep point one above in mind: more analysis is generally better than less.
