Canada Finalizes Reduction of Carbon Dioxide Emissions from Coal-Fired Generation of Electricity Rule

Environment Canada has published its final rules for the Reduction of Carbon Dioxide Emissions from Coal-fired Generation of Electricity.  Published in four parts, the regulations establish a regime for the reduction of carbon dioxide (CO₂) emissions that result from the production of electricity by means of thermal energy using coal as a fuel, whether in conjunction with other fuels or not.  A brief synopsis of each of the four parts is provided below:

Part 1, Regulated Units and Emission Limit, sets out a performance standard for the intensity of CO₂ emissions from regulated units and provides for exceptions based on the substitution of units and for temporary exemptions in relation to emergencies and units integrated with carbon capture and storage systems.  Specifically, a new or old unit must not, on average, emit with an intensity of more than 420 tonnes of CO₂ emissions from the combustion of fossil fuels for each Gigawatt hour (GWh) of electricity produced by the unit during a calendar year.  This includes CO₂ emissions released from the use of sorbent to control the emission of sulfur dioxide from the unit and emissions from a gasification system that produces synthetic gas derived from coal or petroleum coke used to generate electricity by the unit.  CO₂ emissions that are captured in accordance with the laws of Canada, a province thereof, or the United States or one of its states are not to be included.  A registration report for each unit must be sent to the Minister of the Environment by February 1, 2013 for an existing or old unit or on or before 30 days after the commission date of a new unit. 

Part 2, Reporting, Sending, Recording, and Retention of Information, sets out quantification rules for determining the intensity of CO₂ emissions from regulated units.  For each calendar year, a responsible person for a new, old, or substituted unit (a unit which is substituted for an original unit which has reached the end of its useful life) must send an annual report to the Minister of the Environment on or before June 1 of the year that follows the reporting calendar year.  In addition, a responsible person must make a record of any application submitted for each unit and must keep the record, as well as any supporting documents, for at least seven years after submission.

Part 3, Quantification Rules, sets out quantification rules for determining the intensity of CO₂ emissions from regulated units.  The quantity of electricity produced by each unit is to be determined by the equation G_gross-G_aux, where: G_gross is the quantity of electricity that is produced by the unit during the calendar year in GWh and G_aux is the quantity of electricity that is used by the power plant in which the unit is located during the calendar year to operate infrastructure and equipment that is used for electricity generation and for separation of CO₂.  The regulations mandate that once a method of attribution is used to make the determination of G_aux for a calendar year that method must be used to make the determination for every subsequent year hence.  Likewise, the quantity of CO₂ emissions from the combustion of fossil fuels in the unit is to be determined by use of a continuous emission monitoring system (CEMs) or by using a fuel-based method.

Part 4, Coming into Force, provides dates for the effective date of these regulations and, in particular, delays the effective date of the performance standard in respect to standby units, section three of the regulations, until January 1, 2030.  All other sections of the regulations come into force on January 1, 2013. 

Environment Canada’s publication of the final rules for the Reduction of Carbon Dioxide Emissions from Coal-fired Generation of Electricity may have important implications for the U.S. EPA’s proposed new source performance standards (NSPS) and a House effort aimed to block them.  The proposed NSPS, which were issued in April 2012, would require new coal plants to install carbon capture systems (CCS) so as to meet emissions standards of advanced gas plants without CCS.  Directly opposing the view taken by proponents of H.R. 6172 that would prohibit U.S. EPA from finalizing the proposed NSPS until formal findings are submitted to Congress showing CCS as a technologically and economically viable, Canada’s GHG performance standards demonstrate that CCS is currently a viable control option for coal plants. 

Furthermore, Canada’s GHG rules may impact the proposed schedule to install CCS called for by the U.S. EPA’s NSPS.  Canadian environmental advocates claim the deadlines included in the rules for the Reduction of Carbon Dioxide Emissions from Coal-fired Generation of Electricity lack urgency and, due to the length of their implementation schedule, are virtually unenforceable.  Clear implications for how these critiques will factor into the House debate are as of now unclear.

More information pertaining to the Reduction of Carbon Dioxide Emissions from Coal-fired Generation of Electricity Regulations may be found in the Canada Gazette Part II at the following website.