Karen Frantz
GHG Monitor
2/07/2014
Controversy over President Obama’s draft regulation limiting greenhouse gas emissions from new power plants played out in testimony delivered at a day-long public hearing at the Environmental Protection Agency’s headquarters this week, with opponents and detractors alike speaking out about a particularly charged provision of the rule forcing coal-fired power plants to install carbon capture and storage technology in order to meet the new standards. The hearing is part of the rule’s 60-day public commenting period that will run through March 10 that kicked off after the EPA’s draft rule was published by the Federal Register Jan. 8. The New Source Performance Standards rule will set separate CO2 emissions standards for coal and gas units and provides incentives for plant developers to install carbon capture and storage technology. Depending on whether plant operators decide to measure CO2 emissions over a 12- or 84-month operating period, individual coal units would have to cap emissions at between 1,000 and 1,100 lbs CO2/MWh and gas-fired turbines, depending on their size, must also meet a CO2 emissions limit of between 1,000 and 1,100 lbs MWh over a 12 month period. The rule also identifies the “partial” capture and storage of roughly 30 to 50 percent of a plant’s emissions as the “best system of emission reduction” technology for coal plants.
That CCS provision in particular has proven to be a red-hot topic, and dissention at the hearing centered in large part over whether the technology is viable for power plants—with opponents arguing that CCS has not yet been adequately demonstrated at commercial scale and that demonstration projects have relied heavily on government subsidies, while supporters contended that CCS is necessary to prevent catastrophic climate change and that the technology is a path forward for coal. Rep. Henry Waxman (D-Calif.) staged a press conference outside of the EPA’s headquarters as the hearing was being held to wage an impassioned defense of the EPA rule and of CCS. “There is a lot of overheated rhetoric in Washington today, especially about this proposal, with some outlandish claims,” he said. “Opponents say this will prevent ever building another coal plant in the United States today. They say that the technology is not commercially available. These claims are scare tactics. Even now, no one is building these uncontrolled coal power plants. Natural gas is less expensive and less polluting. But if natural gas prices were to rise or coal can compete again, this rule will provide the certainty that we will capture the carbon pollution from these coal plants. This certainty helps the coal industry by reducing the risk of investing in a new plant.”
He also said that advances in CCS technology will help reduce its price and that industrial carbon capture and enhanced oil recovery operations using CO2 have been operating for decades. “This technology is for real and available but right now, we’re all subsidizing the unregulated burning of coal,” Waxman said. “We subsidize it because they’re not paying for the full cost of doing business. They’re not paying for the harm they do to people’s health and they’re not paying to control the harm that they’re doing to this planet. It costs more than dumping it for free, if you ask them to put the control technology in place. It’s not prohibitive, for once these controls are required, industry will figure out a way to cut costs and improve effectiveness. Every American is paying the price now for coal pollution and costs for future generation will even be higher. That’s not fair, it’s not reasonable, and that’s why we’re looking to EPA to adopt these rules.”
Opponents Worry about Energy Reliability
But some opponents, including John Novak, Executive Director of Environmental Issues at the National Rural Electric Cooperative Association, testified that the rule has the potential to weaken the country’s ability to provide reliable electricity at an affordable cost and that it will do little to advance CCS technology. “As demonstrated by cold snaps just this winter, natural gas prices are volatile despite even very shorter-term weather events,” he said. “This has an immediate adverse effect on consumer electric bills. Coal and its stable prices are a long term proven hedge against natural gas volatility and it is critical that we are going to continue to provide affordable electricity to our members. … EPA’s proposal will require new units to install CO2 capture technology that is costly and not commercially viable, effectively removing coal from use as a hedge against natural gas price swings. There are areas of the country that will require additional electricity capacity in the future, but do not have sufficient access to natural gas, do not have suitable sites for CO2 storage or for enhanced oil recovery and cannot be supplied wholesale power reliably through the existing transmission grid.”
He also argued that CCS should not be considered the best system of emission reduction for coal-fired plants. “CO2 capture technology has not been deployed at commercial scale at any power plant anywhere in the world,” he said. “Costs should be considered, and the additional costs associated with CO2 capture are very large, unacceptable and would roughly double the cost versus a conventional coal plant without CO2 capture.” He pointed to Southern Company’s Kemper County IGCC plant in Mississippi as evidence CCS has not been adequately demonstrated, saying that the plant is still under construction and will deploy a gasifier technology that is first-of-a-kind—and added such first-of-a-kind technology doesn’t always work. He also said Kemper is only viable because of public subsidies and financial incentives. “The public subsidies are not available for new projects, and the financial incentives unique to Kemper do not apply to other projects in other locations,” he said.
Contention Also Arises over Natural Gas Plants
But the rule’s effect on coal-fired plants was not the only topic of controversy at the hearing. Felice Stadler, Senior Director of the National Wildlife Federation’s Climate and Energy Program, also urged the Administration to revisit the portion of the rule setting emission limits for natural gas units. “The Clean Air Act is intended to be technology forcing, so setting a carbon standard for new gas plants that doesn’t prompt new plants to use better, cleaner technology, misses the mark,” she said. “We urge the agency to revisit this before finalizing the rule and considering a more stringent carbon limit for new gas plants so that the standard is driving the clean technology to achieve reductions for the entire utility sector.” The rule identifies natural gas combined cycle technology as the best system of emission reduction for new gas units. Stadler also asked the EPA to take additional action to address methane leaks from gas production. “It’s an uncontrolled and potentially very sizable source that can be reigned in cost-effectively,” she said.
