New Greenhouse Gas Emissions Regulations

The U.S. Environmental Protection Agency will regulate greenhouse gas emissions for the first time.  Power plants and other large-scale facilities must use the latest technologies to mitigate greenhouse gas emissions to meet the EPA’s air quality standards.  States are required to modify their permitting rules or the EPA will step in and issue permits under the new rule.  Meanwhile, Congress prefers legislative action rather than command-and-control regulation.

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The U.S. Environmental Protection Agency will regulate greenhouse gas emissions for the first time.

  • The EPA will begin regulating greenhouse gas emissions on a case-by-case basis beginning Jan. 2, 2011, under the authority of the Clean Air Act, if a new or modified power plant’s pollutants (other than greenhouse gases) are in question and trigger a New Source Review, or automatic preconstruction permitting process. This process is required whenever stationary sources of air pollution such as power plants are built or significantly modified.
  • Beginning July 1, 2011, the EPA will regulate greenhouse gases for all large-scale projects, regardless of whether other pollutants trigger a review.
  • The rule applies to new facilities that generate more than 100,000 tons of carbon dioxide per year or modified facilities that increase emissions by 75,000 tons of CO2 per year. This represents only the largest facilities, such as power plants, cement factories and landfills.
  • Besides CO2, the EPA will also regulate methane, nitrous oxide, hydrofluorocarbons,  perfluorocarbons and sulfur hexafluoride gases.

Power plants and other large-scale projects must meet the EPA regulations in order to get a permit to build and operate. Permits are typically issued by the states using federal guidelines.Power plants and other large-scale facilities must use the latest technologies (known as best available control technology, or BACT) to mitigate greenhouse gas emissions to meet the EPA’s air quality standards.

  • Permits to build and operate projects that release emissions regulated by the EPA will require the use of the best technology available to control those emissions.
  • Technologies used to meet the EPA requirements will be determined on a case-by-case basis and is up to the local permitting authority to decide the most appropriate and cost-effective method for mitigating greenhouse gas emissions.
  • Examples of the technology used to mitigate greenhouse gases include:

    • Equipment or processes that reduce emissions from the outset, such as improved fuel mixes;
    • Equipment or processes that clean the air after the fuel is burned, such as scrubbers; or
    • Equipment that could potentially capture and store the carbon deep underground so it is not released into the atmosphere.
       

States are required to modify their permitting rules (known as state implementation plans, or SIPs) or the EPA will step in and issue permits for power plants and other large projects under the new rule.

  • Thirteen states—Alaska, Arizona, Arkansas, California, Connecticut, Florida, Idaho, Kansas, Kentucky, Nebraska, Nevada, Oregon and Texas—will need to modify state implementation plans in order to ensure greenhouse gas emissions are covered.
  • If states can’t modify their state implementation plans in time, the EPA will temporarily issue permits until the state’s implementation plan is complete.
  • Several states oppose the rule. Texas, at the order of Gov. Rick Perry, refused to implement the rule and is challenging it in court.

Meanwhile, Congress and industry both prefer legislative action rather than command-and-control regulation, where the precise measures to be taken are dictated.

  • A command-and-control method of regulating greenhouse gases, such as the EPA’s new rule, is expensive and relatively inflexible. A market-based approach, such as a cap-and-trade program, would set an overall cap on emissions that would decrease over time, but allow companies to choose how they reduce emissions.
  • Expect Congress to bring climate change legislation to the floor again next year in an attempt to wrest control from the EPA.
  • Such legislation will likely take the form of a cap-and-trade program and will likely initially regulate the utility sector then expand to other sectors.

Additional Resources:

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