WRAP UP

Tamar Hallerman
GHG Monitor
06/01/12

IN THE INDUSTRY

An American Electric Power subsidiary in Kentucky withdrew its request this week to retrofit an aging 800 MW coal-fired unit in the eastern portion of the state with scrubbers to cut down on SO2 and other toxic emissions. Kentucky Power said it wants to reevaluate its options for compliance with environmental regulations recently promulgated by the Environmental Protection Agency. The utility said altered market conditions over the last several months caused it to reexamine the $940 million retrofit of the 49-year old Unit 2 at Big Sandy, which is required under EPA’s recently-finalized Mercury and Air Toxics Standards. The unit was initially included in AEP’s plan to shutter roughly 6,000 MW of its coal capacity in response to EPA’s air quality regulations, but earlier this spring the utility said it instead would retrofit the unit. Opponents criticized the retrofit plan given that the nearly $1 billion in costs would be carried over to area consumers via a 30 percent rate increase if approved by the Kentucky Public Service Commission.

AT EPA

A federal judge ruled this week that the Environmental Protection Agency must propose regulations on soot pollution within the next week. A judge for the U.S. District Court for the District of Columbia ordered for EPA to sign a proposed rule by June 7. The ruling comes in response to a lawsuit filed by the American Lung Association and nearly a dozen states arguing that the rulemaking is more than six months overdue. Under the Clean Air Act, EPA must reissue national ambient air quality standards on particulate matter every five years. The last time EPA issued regulations on the matter was in 2006, and an update was due in October 2011, the judge said. EPA said it sent the proposed rule to the White House Office of Management and Budget for review May 29. Interagency reviews typically take up to 60 days to complete.