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Many of you may have forgotten about the Cross State Air Pollution Rule (CSAPR) and its status.  CSAPR is one of those “on-again/off-again” rules that U.S. EPA (EPA) has developed.  As a reminder, CSAPR replaced the Clean Air Interstate Rule (CAIR), which (sort of) replaced the Acid Rain Program (ARP).  Because CSAPR primarily affects  Electric Generating Units (EGUs), it’s not surprising that most folks may have not given it much thought of late, but that  “out of sight, out of mind” mentality is about to change. To brush up on some of the history of the transition from CAIR to CSAPR, please refer in my article “PADEP Transition from CAIR to CSAPR” from last June.  Also, keep in mind that the circumstances discussed within this article pertain specifically to Pennsylvania.  However, the implications of this recent Pennsylvania CSAPR activity could occur in any CSAPR affected state.

Recent History

Many who had been following the evolution of CSAPR may have actually shifted their attention to the Clean Power Plan (CPP), which regulates Greenhouse Gases (GHG), not nitrogen oxides (NOX) and sulfur oxides (SOX).  The CPP would actually result in significant reductions in all of these pollutants, so much so, that even the power industry reduced their focus on CSAPR, providing their undivided attention to the CPP.  There is good reason for this shift in regulatory priority of the power industry because the CPP, quite honestly, would make CSAPR nearly irrelevant.  However, the regulatory situation has recently changed slightly because in February of this year the Supreme Court issued a stay of the CPP, halting implementation of the CPP.

The CPP is currently stayed pending disposition of the petitions that are before the United States Court of Appeals for the District of Columbia Circuit (D.C. Circuit Court).  Recently the D.C. Circuit Court decided to delay its review until September 2016, at which time the entire panel of justices (En banc) will hear the arguments for review.  This review almost assures that no decision will be final at the D.C. Circuit level and almost assuredly at the Supreme Court level, before the present Administration leaves Office in January of 2017.   Under these circumstances, the fate of the CPP is precarious at best.  Both sides of the argument are claiming that the collective court activities favor their position, but one thing is clear; uncertainty prevails.

Meanwhile, in the shadows of the legal maneuvering over the CPP, EPA has been quietly working to address the shortcomings of CSAPR.  If you remember, in July of 2015, the D.C. Circuit Court ruled that the 2011 CSAPR regulations had a number of “issues” that needed to be addressed and so remanded CSAPR to EPA for revision.  In its review, the D.C. Circuit Court did not vacate the CSAPR emissions budgets that EPA had previously set for states.  As a result of the initial stay of CSAPR, CAIR emission budgets were used for 2015, but EPA placed the CSAPR budgets back into place for the beginning of 2016.

What does this mean?

A very significant development within CSAPR is quietly occurring under the radar which could significantly impact everyone living in Pennsylvania next year.  That is, EPA is proposing to cut the NOX “allowances” to Pennsylvania utilities under CSAPR by approximately 74%.  Does that mean that 74% less electric power will need to be generated? Well no, but it does mean that many more coal-fired power plants may be forced to close in Pennsylvania.  It also means it will be much harder to move the electricity around the grid from fewer power plants and also much more costly to push these electrons around to everyone.  For some residents it will also increase the likelihood of power outages during power demand surges (remember the polar vortex?) due to the closure of existing power plants.  These drastic regulatory steps are being moved forward by EPA in spite of ambient pollutant monitoring data in the Northeast and Mid-Atlantic regions that show improving ozone air quality with projections of continuing improvement. EPA’s regulatory proposals can only be captioned as “game changers”, that will happen virtually overnight by January 2017.  EPA’s regulatory actions rely on air quality modeling (computer predictions) that is being questioned by many, including the State of Pennsylvania.

The proposed CSAPR revisions by EPA are required to address the interstate transport of NOX emissions with respect to the 2008 Ozone national ambient air quality standard (NAAQS).  EPA’s proposal also responds to the July 28, 2015 remand by the D.C. Circuit Court, as discussed previously, to reconsider the ozone NOX emissions budgets established under the 2011 CSAPR. In addition, the proposal for emission reductions from the electric generating sector (i.e., reduction in NOX allowances) was also described by EPA as necessary to provide a partial remedy to address the failure of certain states to submit a Good Neighbor State Implementation Plan (SIP) revisions under section 11 O(a)(2)(D)(i) of the Clean Air Act (CAA).

Based on the above circumstances, it seems that EPA may not have had a choice in the matter.  This might be the case if the air quality science relied upon by EPA to develop their revised NOX Budgets was not flawed.  The ozone modeling by EPA used old, higher emissions data, which are not reflective of the actual NOX emission reductions that have already been achieved in Pennsylvania and elsewhere in the Northeast.  It also does not consider the significant NOX emission reductions that Pennsylvania will achieve by January 1, 2017 as a result of the Pennsylvania RACT 2 regulations for NOX.  The EPA modeling results appear to have not even triggered a re-assessment of the validity of those results which clearly do not align with the actual ambient pollutant monitoring data. Each of these critiques regarding EPA’s reliance on older, higher emissions data that do not reflect the actual emissions level of today have been filed with them by the State of Pennsylvania and by others. EPA has been asked to conduct new photochemical ozone modeling using representative emissions information.  The photochemical modeling conducted by EPA has also been criticized for  its use of a number of flawed modeling assumptions that further exacerbate the amount of NOX reductions that the model indicates are required.  In its 32-page critique of EPA’s proposed reduction in Pennsylvania CSAPR NOX allowances, the Pennsylvania Department of Environmental Protection  (PADEP) stated that the “reduction proposed for Pennsylvania’s ozone season NOx budget in the CSAPR Update Rule is not achievable by the 2017 ozone season”.  This is an unqualified and telling statement by the State of Pennsylvania of the electrical supply chaos that would likely ensue.  To our knowledge, as of today, EPA has not made any public response to comments on the criticisms that have been made over their handling of proposed CSAPR NOX Budgets; or if EPA intends to remodel with the correct emissions information.

Conclusion

This is very serious business with equally serious consequences for Pennsylvania residents and electric power generators.  The potential impacts associated with EPA’s current approach to the Pennsylvania NOX budgets should trigger the need for a complete and thorough review of both the modeling results and the associated consequences.  Taking the time to make sure that impactful decisions are based on sound science and accurate information and that the consequences of such decisions have been carefully vetted is much more important than rushing the process before a change in Administration.

The circumstances described for Pennsylvania EGUs could just as easily occur in other CSAPR affected states, especially in the Northeast U.S.   Mainly, if EPA did not get Pennsylvania’s emission inventory for the CSAPR modeling correct, what are the chances that emissions inventories for other affected states are correct?  If this occurred 20 years ago, it would be safe to assume that emissions inventories were not changing significantly and that 2 year old emissions data would likely still be representative.  However, in today’s ever-changing environmental regulatory arena, emissions from EGUs and other large combustion sources have been on a steep downward incline based on both regulatory and economic pressures.   If you are a CSAPR affected facility, it is in your best interest to keep track of the allocation status in your specific state and to verify that the emissions information being used for your facility for the CSAPR modeling is both representative and correct.

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