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STATE AIR PERMIT MAY POSE CHALLENGE TO EPA ENFORCEMENT OF GHG LIMITS
Dawn Reeves – Clean Energy ReportUtah regulators have retreated from their refusal to include a numeric greenhouse gas (GHG) limit in a permit for a new natural gas-fired power plant -- seen as a test of EPA’s GHG emissions control requirements -- after the facility’s owners indicated they would accept a limit to satisfy the agency’s strong opposition to the lack of a limit.
However, the GHG limit does not require the company to take any additional steps to limit emissions or install GHG controls, and it is unclear whether the permit will satisfy EPA or environmentalists who could contest it. The limit for the 629 megawatt (MW) combined-cycle facility, issued May 4, is based on a high potential to emit (PTE) that one state source describes as “like telling someone they can’t operate more than 24 hours a day.”
The numeric GHG limit imposed by Utah is a carbon dioxide equivalent (CO2e) of 950 pounds per megawatt (MW) hour gross on a 12-month rolling average.
The GHG limit in the draft Utah permit for the proposed Lake Side power plant was defined only as a work practice standard that included an efficient turbine. The final permit also includes a projected GHG emissions increase of 1.8 million tons per year (tpy) of CO2e though notes that total potential GHGs are 3.6 million tpy of CO2e.
The original Jan. 19 draft permit the Utah Division of Air Quality (UDAQ) issued to PacifiCorp to build Lake Side was seen as a test of EPA’s best available control technology (BACT) guidance for GHGs, because it did not set a numeric limit on GHGs as EPA requires and instead relied on work practice standards (see related story).
EPA Region VIII raised concerns about the permit in a March 4 letter to the state, saying “an undefined design standard as BACT, rather than a numerical emissions limit, does not satisfy the definition of BACT.” The agency also urged the state to “include an appropriate BACT limit” in the permit before finalizing it.
EPA has stressed that it will focus on process and documentation in reviewing whether states with delegated GHG permitting authority, such as Utah, are meeting the requirements of the BACT guidance.
But a Region VIII source said of the Utah permit last month, “We’re clearly explaining it’s not just a matter of inadequate documentation but that a numeric limit needs to be in the permit that is not there.
We are saying something is missing from the permit.” The source added that it was unclear what steps the agency would take if the state finalized the permit without a numeric GHG limit.
State Disagreed That GHG Limit Was Required
A Utah air official also told Inside EPA last month that the state disagreed that a numeric GHG limit was required because the state had interpreted EPA’s BACT guidance as allowing a work practice standard to address GHG emissions in lieu of a numeric limit. The state “didn’t see any real value” in requiring a numeric limit because the plant was installing the most efficient turbine available for reducing GHG emissions, the source said.
In a follow-up interview the source now says that the state decided to include a GHG limit in the final permit because there “was a desire on the part of the source to get the permit. So they accepted that limit. We feel that that limit is a legitimate limit but it is a potential to emit, so it is like telling someone that they can’t operate more than 24 hours a day.” However, the source says the limit satisfied EPA because “it is actually” a limit.
UDAQ in its May 4 response to comments on the draft permit says, “The BACT analysis for greenhouse gas emissions concluded that the ‘proposed combined cycle efficiency’ and ‘proposed auxiliary boiler efficiency’ options . . . were BACT for this project. The efficiency is a function of the design of the equipment and does not represent the addition of ‘add-on’ controls or an additional control strategy. UDAQ considers this design standard as meeting BACT for GHG” as required under EPA’s guidance for meeting its GHG permitting rules.
However, the state’s response document adds, “A greenhouse gas emission ‘limit’ would represent the [PTE] from this project. Using the PTE as a limit for purposes of BACT adds no value to the resulting permit. . . . However, as the source has requested quicker issuance of the [permit] and is willing to accept a numeric limit on greenhouse gas emissions, UDAQ has agreed in this instance to include a PTE-based on CO2e limits.”
The Region VIII source says the agency had one follow-up phone conversation with UDAQ following the March 4 letter and notes the agency has not yet formally received the Utah permit or response to comments.
An EPA headquarters spokeswoman says the agency “expects that the basis for the BACT limit will be explained in the state’s response to comments, which we have not yet had an opportunity to review.”
The spokeswoman adds that the agency is working to ensure that the new GHG permit requirements do not hold up permits. “Time-tested approaches to Clean Air Act permitting are working well to address these emissions without disruption,” the source says, adding that the Utah permit means that four final GHG permits have now been issued so far this year, while another 100 pending projects may need to address GHGs in their permits.
One environmentalist calls the GHG limit for Lake Side “very high” for a natural gas-fired facility, and says environmentalists will have to look at the permit to see if there are reasons why it needed to be set so high, such as if there is other equipment that would hamper efficiency and in turn boost GHGs.
The GHG emissions limit in the Utah permit is higher than what California officials required in a permit issued last year for the Russell City Energy Center, a 600-MW, gas-fired combined-cycle plant that was the first to include a GHG limit and was seen as setting a precedent on the level of GHG controls required in permits for natural gas plants. Lake Side’s equipment “could be different from Russell City,” the environmentalist notes.
EPA also complained in its original comment letter to Utah that the Lake Side efficiency was “less than that of the Russell City Energy Center,” which Utah said served as the baseline for the Lake Side GHG review. But in its response to comments, UDAQ defends the Lake Side limit, noting a comparison of the “heat rate values indicates that the energy efficiency of the Lake Side Block 2 project on the same operating basis is approximately 2.7 percent more favorable than” Russell City. PacifiCorp officials could not be reached for comment.
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Carter Wood - NAM ShopFloor Blog
The National Association of Manufacturers has signed on with a letter to Congress from members of Health Choices Coalition, urging legislators to overturn the ban on use of employees’ Flexible Spending Accounts for over-the-counter drugs. OTC drugs are effective and FSAs are effective, providing an important measure of consumer control over health-care spending, yet last year’s health care law limited the accounts.
The Consumer Healthcare Products Association issued a release on the issue earlier this week. Excerpt:
“This issue is about empowering millions of American consumers to cost-effectively manage their families’ healthcare needs,” said CHPA Vice President of Government Affairs Bill Head.
“The availability of OTC medicines through an employer-sponsored FSA provides valuable cost-savings to consumers, increases worker productivity, and encourages smart healthcare decisions by both employers and employees — all of which are consistent with the goals of healthcare reform.”
Prior to January, OTC medicines were eligible for reimbursement under FSAs and other tax-preferred savings accounts. An estimated 19 million working American families purchased these cost-effective medications through their FSAs. (continue reading…)
Alicia Meads - NAM ShopFloor Blog
Additional regulations will actually create jobs? That’s what the BlueGreen Alliance and the Political Economy Research Institute (PERI) would have us think in a new study titled “The Economic Benefits of a Green Chemical Industry in the United States.” The study argues that more burdensome industry requirements under the Toxic Substances Control Act (TSCA) will create jobs and drive innovation.
Manufacturers have first-hand knowledge that piling on additional and unnecessary regulations keep them from doing what they do best – helping to boost our fragile economy by expanding production and creating new jobs in the manufacturing sector. And what this alliance of labor unions and environmental activists is actually proposing is to undermine intellectual property rights, the sine qua non of innovation in this country.
Specifically, the study claims that TSCA reforms are needed to encourage the dissemination of “environmental and health-related information on the chemical industry as widely as possible to improve the choices available to consumers, workers, downstream users, and investors and to mobilize investment in emerging opportunities.” To compete in today’s global economy, manufacturers depend on federal government protections of Confidential Business Information (CBI) regarding their products. If TSCA reform made this information publicly available, manufacturers would be discouraged from making product investments and also developing new “green” chemicals and consumer products.
The National Association of Manufacturers believes that TSCA reform should be practical and achievable, but the policy recommendations in the BlueGreen Alliance study would place unworkable restrictions on many of our nation’s manufacturers. The result: continued off-shoring of high-paying manufacturing jobs.
Brian Raymond - NAM ShopFloor Blog
Improving our nation’s cyber-infrastructure is of critical importance for national and economic security. Cyber-attacks can have a devastating impact on both government agencies and manufacturers, which dampens our economic growth and competiveness. Manufacturers are pleased President Obama has put forward a plan to help improve our nation’s defenses against harmful attacks.
The plan announced by the Administration includes many key reforms sought by manufacturers, including better collaboration between private industry and the government to identify and respond to threats and attacks. Policies which draw on industry wide best practices and partnership with the government are vital for manufacturers continue to lead in responding to new threats.
We look forward to working with both the Administration and Congress as they begin to discuss cybersecurity reforms.
Brian Raymond is director of technology and domestic economic policy, National Association of Manufacturers.
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