From staff reports
GHG Monitor
3/28/2014
As the Environmental Protection Agency moves forward with a new rule for reducing greenhouse gas emissions from existing power plants, one important question the agency faces is whether it will only examine options “inside the fence line”—those at the plant itself—or consider options that would be “outside the fence line,” according to a paper issued by the Center for Climate and Energy Solutions this week. “EPA may choose to draw that line differently when it comes to standard-setting and to compliance. For example, it may allow going outside the fence line for compliance purposes to minimize the cost of meeting the standards, even if the standard is set based only on practices and measures inside the fence line,” the paper states, adding, “The environmental and economic outcomes of this rule depend on EPA’s responses to these questions.”
One area where the inside or outside the fence line question comes in is the approach the EPA will take concerning “the best system of emission reduction” (BESR) to be used, according to the paper. “The brevity and lack of specificity of the language in Section 111(d) give EPA some latitude in defining what ‘best system of emission reduction’ (BSER) means for each regulated sector, but it is not clear to what degree, and every option is vulnerable to a legal challenge,” the paper says. “A very narrow approach to BSER would define it as a specific control technology applied at the plant level. At the other end of the spectrum, EPA could define BSER much more broadly, taking into account emission reduction possibilities throughout the electricity system, from generator to end user,” the paper says, adding, “Generally speaking, broader approaches that look outside the fence line make greater emission reductions achievable, but require EPA to move further from its wealth of experience in traditional plant-level standard-setting.”
