Regarding not selecting CCS as BSER for NGCC, see preamble section IX.C.4.  EPA disagrees with this comment.  As EPA has emphasized in response to previous comments, this rule does not constitute a moving away from energy diversity needed for responsible policy choices, and commenters are wrong to assert historical trends or recent reliability issues have negative implications for the promulgation of this rule.  As we make clear in the TSD in the docket for this rule, "Trends in the Structure of Electric Power Sector Limiting Amount of New Coal", the trends away from coal have been occurring for some time; modeling from EPA and independently from EIA confirms that this trend can be expected to continue in the absence of this rule. The presence of this rule will not alter this basic finding.  These basic finding hold regardless of the events from recent winters, since the fuel mix will remain diverse both without the rule and with it.  As a result, EPA does not believe there will be adverse impacts on reliability.
Proposed rule will result in a higher cost, less stable, and more risk prone, electric generation and distribution system
Commenters (9602, 10039, 10048)  state that the rule will result in a higher cost, less stable, and more risk-prone electric generation and distribution system.
Commenter 9602 states, with this proposed rule, the EPA, in effect, bans new coal plants, and in doing so takes an affordable, stable and abundant electric generating resource off the table, without adequate evaluation of the availability and costs of replacement generation.  Commenter says, in doing so, the EPA introduces unprecedented levels of risk into the electric generation system that threaten costly and dangerous future shortages and potential rolling blackouts in certain regions of the country.
Commenter 10039 believes the EPA's proposed rule is intended to, and will have the net effect of, preventing the construction of new coal fired electric generating units. Commenter says, the EPA states in the proposed rule that it believes the rule will have little effect because utilities do not plan on building new coal fired generation. Commenter says, the EPA fails to acknowledge that utilities understand the adverse regulatory climate surrounding coal use due largely to the number of recently promulgated and soon to be promulgated rules directed at coal fired electric utilities, including CAIR/CSAPR, MATs, EGU GHG NSPS, CWA 316a, CWA 316b, and coal ash/solid waste regulations. Commenter says, it is this suite of rules which the utility industry believes are aimed at reducing US reliance on coal generation by regulating coal fired generation out of business. Commenter says, it is therefore self-serving for the EPA to claim that this rule does not impact the EPA's models of the industry significantly because utilities have no plans to develop new coal fired generation and ignoring that this is the EPA's ultimate goal by promulgating rules which make coal fired generation inordinately expensive.
Commenter 10039 believes that over time reducing the electric system's reliance on coal fired generation will result in a higher cost, less stable, and more risk prone, electric generation and distribution system. Commenter says, for this reason, they believe the EPA needs to re-consider this proposed rule and the effect that it will have on electric system reliability over the long term.
Commenter 10039 states a more costly, less reliable electric system will undoubtedly have a negative impact on the health of Americans by increasing the cost of energy and impacting every facet of our lives. Commenter says, higher electric costs will impact the ability of people to pay for heating and cooling, resulting in adverse effects on health, including increased hospitalizations and premature deaths. Commenter says, unreliable electric delivery can impact the operation of health care delivery organizations. Commenter says, the negative impacts of higher electricity costs as well as a less reliable electric delivery system on non-air quality health and energy in this country should be considered by the EPA.
Commenter 10039 believes the EPA either ignores or misunderstands the vital function that coal plays in the ability of utilities to provide a low cost, reliable, and stable electricity supply. Commenter says, unlike natural gas, unlike sunlight and unlike the wind, coal can be stockpiled. Commenter says, because utilities can stockpile coal, they are not as vulnerable to large fluctuations in the cost of coal supply making coal fired generation economically stable. Commenter says, but stockpiling coal has a more important function from an electric supply perspective. Commenter says it gives utilities the ability to provide electricity to the electric grid even in the event of a disruption in the supply of fuel. Commenter says this was very important during the development of the electric grid and remains an important factor today given the geopolitical climate and the known risk of terrorism attacks on the electric grid. Commenter says the EPA needs to understand, and accommodate in this and any proposed rules dealing with electric utilities, that forcing change to the electric grid through regulation of electric generating units can result in an electric system which is more vulnerable to disruption.
Commenter 10039 states it is widely understood that the electric grid is vitally important to the economic stability of the United States. Commenter says, for this reason, short term and long term disruptions of the electric supply are considered to be a prime objective of terrorist organizations. Commenter says, coal fired generation is a fundamental hedge against electric supply disruption because it is nearly impossible to disrupt coal fuel supplies for periods longer than on-site coal stockpiles can reliably meet generation needs.
Commenter 10039 states natural gas, on the other hand, is not and cannot be safely, reliably stockpiled at the point of generation. Commenter says, natural gas must be piped into generating facilities continuously at large quantities from long distances. Commenter says, disruption of natural gas supplies either because of pipeline events such as terrorism or because of supply restrictions due to heavy demand, as occurred in late 2013 and early 2014, results in the unavailability of natural gas electric generation.
Commenter 10039 states, in a future where natural gas is the source of base load electric generation, electric supply disruption will be as simple as disrupting the pipeline supply of natural gas. Commenter says, eliminating a single pipeline either by terrorist attack, pipeline failure, or natural event (earthquake), could result in the shutdown of a significant portion of the electric grid in this country for a significant period of time in the absence of coal fired base load generation. Commenter says, this disruptive effect has been observed in areas of the Middle East which largely rely on fuel pipelines to supply fuel to electric generating units. Commenter says, terrorist disruption of a pipeline would result in weeks of electric distribution system downtime should the US become overly reliant on NG as the source of base load power generation.
Commenter 10048 echoes this concern, saying that infrastructure security is a concern in the transport of natural gas.  Commenter says, if a major transmission pipeline becomes compromised or unavailable, it could result in detrimental impacts to electricity reliability in a given area.  Commenter 10048 states that the EPA failed to appropriately consider these challenges in its analysis.
Commenter 10039 states this is a significant risk which must be taken into account in a rule that by its own admission can and will result in a wholesale change in the mix of base load generation units over the long term. Commenter says, this rule obscures the fact that it will result in a change to the electric generating industry from a reliance on coal for intermediate and base load generation to a greater reliance on natural gas for intermediate and base load generation.
Commenter 10039 states the EPA's assertions that utilities prefer fuel diversity which can be met with nuclear, biomass and geothermal power ignores the reality that these forms of generation cannot and will not be able to replace coal supplied generation. [A utility's preference for fuel diversity is an economic preference since fuel diversity leads to least cost generation methods over the long term and limits a utility's economic risks associated with short term price spikes on individual fuels. However, utilities must plan for changes to generation mix years and even decades in advance. Construction of new generating units at even an existing facility can take up to ten years from the planning and permitting stage to the end of construction. This is a longer term view that necessitates a broad mix of generation assets.] Commenter says, fundamentally, nuclear power's share of generation has not increased since 1988 and new nuclear power projects have been limited in that time because, fundamentally, nuclear power (post Chernobyl and post Fukushima) presents too much risk at too high a capital cost. [Commenter acknowledges that US DOE has embarked on a new small modular reactor technology development program, however, at this point in time, this program has not changed the fundamentals underlying the risk involved in private investments in new nuclear power projects. Cost pressures related to low natural gas prices and low electric wholesale prices will result in a 10% decrease in available nuclear capacity by 2020 according to EIA estimates in their 2014 annual report. This is contrary to EPA's assertion that nuclear supplemented by biomass and geothermal can replace coal base load generation. See Commenter's Attachment 1.] Commenter says, biomass and geothermal power do not have the potential to replace coal supplies for intermediate or base-load generation due to lack of biomass supply and a lack of geothermal development potential.
We disagree with the commenter's statement. The EPA's modeling, conducted using the Integrated Planning Model (IPM), as well as modeling conducted by the U.S. Energy Information Administration (EIA) showed that new generating capacity built through the period of analysis would be in compliance with the standard even in the absence of the regulation. This finding held true even under a number of alternative scenarios involving significant increases in both natural gas prices and electricity demand. As a result, the EPA projects that  there will be negligible costs, benefits, or energy impacts (including changes to natural gas prices) associated with the rule in the period of analysis.
The proposed rule will leave the nation's electricity supply less diverse, less reliable and more expensive
Commenters (9190, 9590, 9725, 10050, 10552, 10680, 10880, 10928, 10974, 10975, 11062, 11063) state, the proposal will leave the nation's electricity supply less diverse, less reliable and more expensive while providing no environmental benefits.
Commenters (9190, 9590, 9725, 10050, 10552, 10680, 10974, 10975, 11062, 11063) state, the EPA's proposal effectively bars the construction of new higher efficiency coal base load power plants that are needed to maintain a diverse, reliable and affordable electricity supply. Commenters say, the centrality of coal based electricity to the reliability and affordability of the nation's electricity supply is beyond dispute. Commenters say, over the past ten years, coal based electricity generation has supplied more than 45 percent of the nation's electricity supply. Commenters say, currently, 25 percent of the nation's base load power generation capacity (coal, natural gas and nuclear) is 40 years or older and in another decade that will reach almost 50 percent. Commenters say, the Department of Energy's Energy Information Administration forecasts that 60,000 megawatts of coal based load power capacity will close over the next several years principally in response to the EPA's recent mercury and air toxic regulations. Commenters say, to maintain a diverse, reliable and affordable electricity grid, new higher efficiency coal units will be required to replace the retiring older coal, natural gas and nuclear electricity generation plants.
Commenters (9190, 9590, 10050, 10552, 10680, 10880, 10928, 10974, 10975, 11062, 11063) state, the importance of supply diversity to the reliability and affordability of electricity is readily apparent. Commenters state, the proposed standard will also lead to more volatile energy costs for businesses and households. American businesses will be less competitive, high-wage jobs destroyed and families forced to pay more to heat and light their homes. Commenters note, Phillip Moeller, Commissioner, Federal Energy Regulatory Commission (FERC), recently testified that "the power grid is now already at the limit" and the "nation's bulk power system is in a more precarious situation than [he] had feared in years past." Commenters note, Michael Kormos, PJM Interconnection, recently advised FERC that "because less expensive coal generation is retiring and being replaced by other potential high energy cost resources, energy prices could become more volatile due to the increasing reliance on natural gas for electricity generation." Commenter 10880 adds, that Nick Akins, CEO of American Electric Power (AEP), also informed Congress that EPA rules have impaired the reliability of the electric grid and "the next cannon ball we see coming at us may not be one we can dodge."  Commenters say, indeed, natural gas prices have more than doubled since their low of $1.82 mm/BTU in April of 2012. Commenters say, this past winter, natural gas prices in some regions reached record highs with mid-points around $40 mm/BTU and bids as high as $100 mm/BTU. Commenters say, daily average power pricing followed swinging wildly from $40 to $800 MWh. Commenters state, greater use of natural gas is partly due to increased supply making it more competitive. Commenters say, however, federal regulations like Utility MACT have led to the closure of a significant number of coal-fired power plants, thereby forcing natural gas generation to pick up the slack. Commenters say, the result is less energy diversity and an electrical grid that is more vulnerable to price spikes during extreme temperatures. Commenters say, in many regions of the country, households depend on natural gas for heat. Commenters say, when temperatures drop, demand for natural gas increases for all consumers including households, commercial buildings and the electric power sector. Commenters say, natural gas supplies can be temporarily strained, particularly if there is insufficient pipeline capacity to meet the spike in demand. Commenters say, during the 2014 polar vortex, some regions of the country came perilously close to demand for natural gas exceeding supply which would have led to interruptions of electricity service.
Commenter (10680) says, unfortunately, this situation likely will only get worse. Commenter (10880) states, Akins further testified that 89 percent of the coal capacity AEP will retire in 2015 due to EPA's Mercury and Air Toxics Standards (MATS) rule was called upon to meet electricity demand this winter. Commenter (10680) says, this situation is a clear-cut example of how the EPA's proposed GHG rule for new power plants can and likely will threaten the reliability and affordability of electricity in this country. Commenters (9190, 10552, 10680, 10974, 10975, 11062, 11063) say, in this regard, EPA's analysis and assumptions for electricity and natural gas pricing are inadequate and unrealistic.
Commenters (9590, 9725, 10050, 10552, 10680, 10974, 10975, 11062, 11063) state, the EPA fails entirely to consider the probability of significant price increases. Commenters say, turning a blind eye toward the inevitable is irresponsible and a costly gamble with the nation's energy future. Commenters say, coal serves primarily the power generation market, while natural gas serves many needs including power generation, residential heating, commercial feedstock for manufacturers, transportation and, in the near future, the liquefied natural gas export market. Commenters say, the EPA's NSPS policies will have a profound effect upon not only the domestic electricity markets but also many sectors of our economy that rely upon natural gas. Commenters say, as the Department of Energy's NETL has warned "policies that encourage the use of natural gas to substitute for coal in power generation could very well lead to spectacular price increases for households and industry." Commenters say, indeed, according to NETL, coal-based electricity restrained the price of electricity and prevented the price of natural gas from matching the rise in the price of oil. Commenters say, the EPA's NSPS proposal will change all of that-and for the worse. Commenters say, nothing in EPA's proposal demonstrates that the agency has performed a reasonable assessment of the impacts of this rule upon the vast number of economic sectors that rely upon reliable and competitively priced electricity and natural gas.
Commenter 10050 states, past efforts by the government to establish preference for various fuels have been followed by emergency action to relax those restrictions when prices have spiked, resulting in substantial energy distortions. Efforts to move the industry to gas in the past have been followed by the energy shortage and emergency orders to convert plants back to coal.
Commenter 10880 states, the proposed rule does not credibly nor adequately project the cost of electricity if the rule is implemented as proposed. Commenter goes on, nor does it take into account the effect on lower income families. Commenter says, due to this proposal, almost half of American households will devote an estimated 20 percent of their after-tax income to energy. Commenter says, in short, rising energy costs impose a substantial burden on most Americans, especially those whose incomes fall below $50,000 in earnings.
Commenters (10963, 11062, 11063) state, coal currently comprises over 40% of this country's electricity needs and has been a major component of the electrical grid for over 100 years. Commenters say, despite this, the proposed NSPS effectively ban the new construction of coal-fired plants and overlook an abundant and dependable resource whose use is growing in every country except our own. Commenters say, we cannot afford to continue to ignore the position coal maintains in our nation's energy portfolio. Commenters say, to do so is to trade a strength for a weakness that will ultimately come at the expense of our nation's economy and grid reliability.
EPA disagrees.  The rule is not expected to change the expectation that coal will not be built in the future.  Coal will continue to be a major source of power generation in the future with or without this rule.  Moreover, as new sources, natural gas combined cycle units are highly effective for preserving reliability. The EPA's modeling, conducted using the Integrated Planning Model (IPM), as well as modeling conducted by the U.S. Energy Information Administration (EIA) showed that new generating capacity built through the period of analysis would be in compliance with the standard even in the absence of the regulation. This finding held true even under a number of alternative scenarios. As a result, the EPA projected there would be negligible costs, benefits, or energy impacts associated with the rule in the period of analysis. See RIA Chapter 4.
Diminished fuel diversity will impair reliability and affordability
Commenters (2470, 3176, 3360, 8957, 9597, 9774, 10104, 9497, 10788) state that diminished fuel diversity will impair reliability and affordability.
Commenter 2470 states, the EPA's final rules should avoid compromising electric system reliability and allow the maximum compliance flexibility for electric utilities provided for under the CAA. Commenter says, electric utilities should be given the flexibility to choose the most efficient, least-cost compliance options to meet public health and environmental goals. Commenter says, because a diversified fuel supply can enhance system reliability and significantly mitigate the effects of volatile fuel price fluctuations, extreme weather events, and unplanned plant outages, it is important that utilities are afforded the greatest possible level of flexibility in determining their generation fuel source mix when seeking to comply with relevant carbon standards.
Commenter 3176 states, the proposed rule effectively bans traditional coal-fired generating technology as a future supply option, despite the fact that this base-load technology has provided reliable, cost-effective electricity to consumers in Alabama, and nationally, for many decades. Commenter says, in so doing, the proposed rule stands to weaken the country's generation portfolio and significantly impact the future cost of electricity. Commenter says, the proposed standard may impact the reliability of our nation's electric system and, as a result, customers will be forced to pay more for a product that is less reliable.
Commenters (3360, 10104) state, the United States utilizes a variety of fuels to generate electricity: coal, natural gas, nuclear, hydropower, wind, solar, biomass, and other renewables. Commenters say, by relying on a diversity of fuels, as well as energy efficiency, American consumers and the U.S. economy are less susceptible to price shocks and market disruptions. Commenters say, our current energy mix has allowed utilities to supply affordable, baseload electricity to customers, mostly through coal-fired and nuclear facilities, while also advancing lower carbon electricity through renewables and natural gas. Commenters say, any precipitous move away from this balanced mix could have serious repercussions for the affordability and reliability of our electricity.
Commenter 8957 states, the proposal can only impair the reliability and affordability of domestic energy supplies by diminishing the diversity of electricity generation sources, both in terms of fuel type and technology, which we rely upon to maintain the energy security of the United States. Commenter says, the proposed rule acts as a de facto mandate from EPA that forces utilities to switch from coal-fired generation to natural gas in the future. Commenter says, the proposal can be construed as an attempt by EPA to pick "winners and losers" in the market place. Commenter says, it is not appropriate or reasonable for an environmental agency to make these types of policy judgments. Commenter concludes, this de facto natural gas mandate may leave U.S. consumers and businesses exposed to less reliable, more expensive, and more volatile electric generation sources in the future.
Commenter 9597 states, fuel diversity ensures that market volatility or supply in one sector can be dampened by utilizing EGUs with different fuel capabilities. Commenter says, put another way, the customers of a generation fleet that overly relies on one fuel type, will undoubtedly experience periodic swings in energy costs. Commenter says, this proposal will further these types of unpredictable and expensive cost swings for electricity customers.
Commenter 9774 expresses a similar concern, highlighting their very significant concern that the NSPS will effectively prohibit siting new coal-fired generation in Wisconsin and within the utility sector as a whole. Commenter states, this impact will result in greater reliance on natural gas fired generation, potential electric reliability issues, added costs, and inequity among states.
Commenter 0784 states, EPA's effort to improve overall public health by reducing emission from coal-fired generation units has the potential to undermine the electric grid system.
Commenter 9777 states, by establishing gas-fueled generation as the only cost-effective option for baseload and demand- following generation, the proposed NSPS would undermine fuel diversity and risk leaving both consumers and retail electricity providers subject to price spikes and electricity supply shortages. Commenter says, the risk of electricity supply shortages is exacerbated through an over-reliance on gas-fueled generation and unlike a coal-fueled power plant, which may store two to three weeks of fuel on-site, gas-fueled plants cannot store reserves of their fuel. Commenter says, disruptions to supply, either through shortages or pipeline failures, could result in the immediate shutdown of regional gas-fueled plants. Commenter says, although each type of power generation is subject to its own reliability risks, fuel diversity ensures that power generation companies have the best chance to continue to supply electricity during times of disruption. By materially limiting fuel diversity the proposed NSPS significantly threatens grid reliability.
Commenter 9777 states, the current spread between coal (with historically stable prices) and natural gas may close in the future, making coal-fueled generation more cost-competitive with gas-fueled generation. Commenter says, with EPA's decision to mandate a CO2 emission limitation that can only be met by a technically infeasible and expensive control technology, options to construct new baseload and demand-following plants would be limited.
Commenter 9497 states, fuel diversity helps ensure reliability and price stability in electric supply, constraints in fuel availability and spikes in fuel prices, related to disruptions in physical production and distribution as well as impacts from regulatory changes, can seriously affect electric companies and customers. Commenter says, diversification of the fuel mix used for generation can help protect against supply crises and temper the exposure of ratepayers and businesses to price volatility.
Commenter 9723 states, EPA regulations should not limit future fuel diversity, which ensures reliable, least-cost electricity. Commenter says, the coal-fired EGU standard in the proposal effectively precludes the building of new coal-based plants and would put the nation at risk of over-reliance on a single fuel source, natural gas. Commenter says, EPA's proposed emission limits for new EGUs precludes coal-based units from playing a role in the power sector's new generation option mix going forward unless carbon capture and storage (CCS), which is not commercially or technically feasible today for EGUs, is employed.
Commenter 10788 states, fuel diversity is important both to current operations and future generation resource planning. Commenter says, the proposed rule effectively eliminates the ability to consider new coal-fired EGUs for future generation which impacts the ability to provide reliable and affordable services to members. Commenter says, the ability to choose from a suite of fuel options during resource planning retains fleet flexibility and reliability and also ensure that economic and efficient electricity is provided to members.
EPA disagrees with this comment.  There is no basis for the root assumption of all of these comments that the final standard of performance in this rule will limit future fuel diversity.  As EPA has emphasized in response to previous comments, this rule does not constitute a moving away from energy diversity needed for responsible policy choices, and commenters are wrong to assert historical trends or recent reliability issues have negative implications for the promulgation of this rule.  As we make clear in the TSD in the docket for this rule, "Trends in the Structure of Electric Power Sector Limiting Amount of New Coal", the trends away from coal have been occurring for some time and are obviously not caused by the standards adopted here; modeling from EPA and independently from EIA confirms that this trend can be expected to continue in the absence of this rule. The presence of this rule will not alter this basic finding.

These basic finding hold even in light of the events from recent winters, since the fuel mix will remain diverse both without the rule and with it.  As a result, EPA does not believe there will be adverse impacts on reliability.
Proposed rule will increase electricity costs and impact reliability
Commenters (0840, 8966) believe the proposed rule will increase electricity costs and impact reliability.
Commenter 0840 states, the EPA is not required to set an existing NSPS for EGUs. Commenter says, however, the agency is going forward with one at the behest of President Obama, even though such a standard could result in immediate harm to electric customers. Commenter believes that regulating CO2 from existing power plants could significantly increase electricity costs and hurt residential, commercial, and industrial customers, as well as impact reliability in certain parts of the country.
Commenter 8966 states that ratification of the rule will cause additional harm to the availability of affordable electricity. Commenter says, the wholesale closure of hundreds of coal-fired power plants without an equal level of replacement construction will amount to the loss of tens of GW available to the electricity grid, and has been projected by several regional electric reliability corporations to seriously threaten grid reliability and continuous service to consumers.
Commenter 8966 says, further, any new coal plant implementing CCS will be required to increase the cost of electricity by 65% over that from a most advanced, ultra-supercritical coal-fired plant, according to DOE's NETL. Commenter says, the lack of availability of coal-based power is likely to cause dramatic price spikes during high demand seasons. Commenter says, for instance, in January 2014, PJM Interconnection, a regional grid operator, requested permission to exceed a $1,000 per MWh price cap, in comparison to the $42 per MWh average rate. Commenter says these price spikes ultimately translate to higher energy costs for consumers, as well as higher costs of goods and services, particularly hurting the poor.
Commenter 9777 states, the efficacy of these projects to reliably generate power and reduce U.S. CO2 emissions is unknown at this time and current cost estimates put these plants well outside the bounds of conventional financing. Commenter says, while it is possible that rising gas prices could create an economic environment favorable to construction of coal-fueled EGUs, it is unlikely that gas prices could ever get high enough to justify the costs of the types of projects cited by EPA.
Commenter 10086 disagrees with EPA's conclusion that the proposal if finalized will have no cost. Commenter says, the resulting costs of the proposal will be substantial for electric consumers and that EPA should rethink the NSPS.
The EPA disagrees with commenters' statements that the regulation will cause economic harm. EPA's modeling, conducted using the Integrated Planning Model (IPM), as well as modeling conducted by the U.S. Energy Information Administration (EIA) showed that new generating capacity built through the period of analysis would be in compliance with the standard even in the baseline scenario and, as a result, the rule would not lead to changes in behavior. This finding held true even under a number of alternative scenarios, including scenarios developed by EIA that reflect economic conditions most favorable to the development of new coal. As a result, the EPA projected there would be negligible costs, benefits, energy impacts (including changes to electricity prices), employment impacts, or economic impacts associated with the rule in the period of analysis. (See Chapter 4 of the RIA.) The baseline for this analysis included existing regulations, so this conclusion takes into account impacts of those actions. In addition, in Chapter 5 of the RIA, EPA presents an analysis of the potential costs and benefits of these standards under a range of natural gas prices. It is only when levelized natural gas prices reach levels not seen in EIA data going back to 1996 that an NGCC unit would become less economic than a non-compliant coal unit.
Proposed rule will harm affordability, reliability, or jobs
Commenter 1510 states, the rules will make our nation's energy less reliable and less affordable, impacting mine, power plant, factory and other workers, their families and their communities, and resulting in serious adverse impacts on their health and well-being. Commenter says, their nutrition will suffer; they will battle with sleep deprivation and higher incidences of depression; they will face more prevalent alcohol, drug, spouse and child abuse, higher suicide rates, more heart attacks and strokes, and lower life expectancies. Commenter says, this means every life that EPA claims its rules will improve - by supposedly preventing climate change- will be made worse by EPA's own rules. Commenter says, every life that EPA says will be saved by its costly, job-killing carbon dioxide regulations will be offset by lives shortened or lost by those rules.
Commenter 1681 is concerned about the EPA's carbon regulations because of their negative impact on the use of coal to produce affordable and reliable electricity, and for its negative impact on direct and indirect jobs of many fine hard working American men and women involved in the coal industry. Commenter says, first, the EPA's carbon regulations should do no harm. Commenter says, carbon regulations should not interfere with affordable electricity prices, reliable electricity supplies, or eliminate well-paying American jobs, especially in states that rely on coal. Commenter says, finally, the EPA should remove all regulatory barriers to efficiency improvements at existing coal-fueled power plants. Commenter says, efficiency improvements are a cost-effective way to reduce emissions, while maintaining affordable and reliable operations.
Commenter 2658 states, EPA should ensure that any greenhouse gas regulations are cost effective, attainable and protect American jobs and the economy.
Commenter 2658 states, in addition to the direct electricity affordability costs of such a situation, over time the increasing lack of base load electricity diversity will threaten reliability and unnecessarily limit risk management tools available to power generators. Commenter says, forcing out a specific fuel source from the electricity generating mix will reduce the reliability of the electricity supply and carry with it real costs both economic and societal. Commenter says, Federal Energy Regulatory Commission (FERC) Commissioner Philip Moeller recently said he expects people will be "panicked" about grid reliability in 2015 due to coal plant shutdowns. Commenter says, EPA should work with FERC and other appropriate experts to study how the proposed rule's ban on new coal-fired power generation could impact electricity affordability and reliability over the long-term. Commenter says, the agency should also examine additional plausible economic scenarios to better understand the potential costs of the rule in the event its forecasts are not accurate.
Commenter 2658 states, taking a major energy source off the table with respect to meeting future electricity is risky and threatens affordability and reliability while reducing base-load electricity diversity. Commenter says, EPA should work with FERC and other experts to analyze the potential long-term impacts of the rule on reliability and affordability.
Commenter 0784 states, while the EPA statutory charge does not require it to consider grid reliability and customer costs in its deliberations, coordinating overall policy development and implementation schedules with the FERC and DOE, to minimize direct and indirect energy and health care costs, would seem the prudent and responsible course of action. Commenter says, EPA should consider the impact of renewable generation intermittency and high voltage transmission line inadequacies while proposing the new plant CO2 emission levels.
Commenter 10555 states, EPA's proposed rule threatens the nation's competitiveness and drives jobs to other countries with increased GHG emissions. Commenter says, the competitive business climate in many states will be diminished without the availability of affordable energy.
Commenter 10555 states, it is vital that the U.S. utilizes an all-of-the-above energy strategy because energy supply diversity keeps energy costs reasonable and ensures steady and reliable energy for industries and homes. Commenter says, with recent technological advances and domestic resource availability, the U.S. is at a competitive advantage when it comes to energy prices and reliability. Commenter says, the proposed regulation threatens to remove this competitive advantage as energy prices become more volatile and reliability diminishes. Commenter says, any reduction in U.S. emissions created by this rule will not only be offset by increasing emissions from emerging economies, but it is likely to result in a net increase in global emissions. Commenter says, a more effective policy would be to promote on-shoring of jobs and production from inefficient carbon intense economies to the efficient U.S. economy.
Commenter 10555 states, businesses and citizens have already incurred substantial burdens through legal mandates on electric generation facilities, including those resulting from legal settlements, fuel switching, forced retirements, pollution controls, renewable portfolio standards, and energy efficiency programs. Commenter says, further imposition of mandates is neither justified nor acceptable.
The EPA disagrees with commenters' statements that the regulation will cause economic or employment impacts. Additionally, the regulation is not expected to cause reliability impacts or leakage of jobs or industry to other countries. EPA's modeling, conducted using the Integrated Planning Model (IPM), as well as modeling conducted by the U.S. Energy Information Administration (EIA) showed that new generating capacity built through the period of analysis would be in compliance with the standard even in the baseline scenario and, as a result, the rule would not lead to changes in behavior. This finding held true even under a number of alternative scenarios, including scenarios developed by EIA that are most favorable for development of non-compliant coal. As a result, the EPA projected there would be negligible costs, benefits, energy impacts (including changes to electricity prices), employment impacts, or economic impacts associated with the rule in the period of analysis. (See Chapter 4 of the RIA.) In Chapter 5 of the RIA, the EPA presents an analysis of the potential costs and benefits of these standards under a range of natural gas prices. It is only when levelized gas prices reach levels not observed in EIA data going back to 1996 that an NGCC unit would become relatively more expensive than a non-compliant coal unit. The baseline for this analysis included existing regulations impacting the power sector, so this conclusion takes into account impacts of those actions.
CCS and affordability and reliability
Commenters (4710, 7433, 7977, 8971, 9408, 9597, 10036, 10051, 10089, 10100, 10664, 9774) are concerned about the impact of CCS on affordability and reliability.
Commenter 4710 states, instead of mandating technology that is not commercially-available, the final NSPS rule needs to recognize the DOE timeline and allow for commercially-available technology to reduce CO2 emissions and allow utilities the flexibility to continue to innovate and achieve greater efficiency, as well as allow commercial CCS technology to "come into its own," all while utilizing our abundant, affordable, and reliable coal reserves. Commenter says, failure to do so will greatly increase electricity prices, increase reliance on natural gas and threaten the reliability of the grid by diminishing fuel choices to generate stable, baseload electricity, as well as cause the loss of thousands of jobs in the coal-mining and manufacturing sectors.
Commenter 7433 states,  making coal uneconomic by requiring CCS and expecting rate-payer or shareholder cost recovery makes it impossible to ensure base load reliability. Commenter is concerned that without adequate funding and/or demonstrated economic viability, CCS technology is not an economically viable means for a coal-fired or pet coke-fired unit to comply with the standard; nor is it necessary. Commenter says, by eliminating coal from the energy generation mix the proposed rule stands to jeopardize grid reliability, public safety, and affordability of utility service. Commenter urges the EPA to accept standards that will allow for the development of supercritical coal plant configurations and options other than gas generation alone. Commenter says, by accepting these standards, it would accomplish the EPA's goal of lower carbon emissions but grant regions currently reliant on coal generation cost-effective opportunities to ensure overall system reliability.
Commenter 7977 states, estimates indicate that the addition of CCS to either an NGCC or USCPC facility would increase cost per kWh by 40 percent to 58 percent respectively.   Commenter says, partial CCS with EOR would result in a 13 percent increase in the cost of electricity from a baseline of zero CCS, according to the Clean Air Act Task Force. Commenter says, by establishing partial CCS as the BSER for new coal-fired power plants, the proposed rule would have an adverse effect on the price of electricity in Kentucky and many other states.
Commenter 8971 states, the EPA states that the fact that costs can be passed on to consumers is a factor in determining whether the costs of a regulation are excessive. 79 Fed. Reg. 1464. Commenter says, while this fact is unlikely to make it into the Obama Administration's talking points, they believe that is fundamentally specious to justify a major rulemaking on the basis that the costs of said rulemaking can easily be passed on to the American consumers and the businesses that employ them.
Commenter 10036 states, the reliability of a CCS system could be affected by problems arising in each CCS process. Commenter says, because carbon capture, compression and transportation, and storage have not been integrated on a power plant, it is unknown how the three processes will interact. Commenter says, for example, it is unknown how problems (e.g., forced outages) at the capture unit will affect the CO2 injection and storage operations. Commenter says, if the capture unit goes down and the CO2 injection rate fluctuates or stops, there could be resulting impacts to the geologic formation. Commenter says, intermittent flow of CO2 into the formation could, in the short term, affect the formation's ability to receive and store the CO2 stream, thus reducing the storage volume while the power plant recovers from shutdown. Commenter says, any issue at the injection site, or along the pipeline, would also directly impact the power plant's ability to operate and to serve its customers while remaining in compliance with the NSPS emission limit. Commenter says, these problems tend to be amplified if the generator relies on third parties to transport, receive and store CO2. Commenter says, together, these concerns can impact the reliability of all major subsystems involved - the power plant, the pipeline, and CO2 storage. Commenter says, the EPA must address these concerns before requiring use of CCS on all new coal fueled EGUs.
Commenter 10051 has concern about the increased cost that will be passed onto industrial consumers as a result of the proposed rule and the use of CCS. Commenter says, implementation of the proposed rule will lead to higher electricity costs, because any new coal-fired power plant will be required to use CCS to control GHG emissions. Commenter says, the EPA acknowledges in the proposed rule that CCS will have higher costs in geographic areas of the country where enhanced oil recovery (EOR) is not practicably available which may tilt the economics against new coal-fired construction. 79 Fed. Reg. 1482. Commenter says, additionally, the EPA indicates that CCS "results in increased capital and operating costs and decreased electricity output (that is an energy penalty), with a resulting increase in the cost of electricity. Commenter says, the energy penalty occurs because the CO2 capture process uses some of the energy (e.g., electricity, steam, heat) produced from the plant." 79 Fed. Reg. 1472.
Commenter 10089 states, any costs that utilities would incur in deploying CCS projects would be borne by consumers. Commenter says, the risk of unjustly burdening ratepayers with these costs warrants scrupulous deliberation regarding whether and how CCS can be incorporated in the construction of new power plants in a cost-effective manner.
Commenter 10100 states, the disincentives to construction of new coal-fired EGUs could impact reliability and prevent states from diversifying their energy portfolios. Commenter says, the excessive costs associated with constructing a coal-fired plant with CCS means that few, if any, merchant power companies or regulated electric utilities will invest in a new coal-fired power plant with CCS. Commenter says, because the Proposed NSPS effectively bans new coal-fired generation in the absence of commercialized CCS, it creates an incentive to continue the operation of older, less efficient coal-fired EGUs rather than construction of new, more efficient units as well as increasing reliance on natural gas rather than maintenance of a more diversified energy portfolio.
Commenter 10664, states industrial operations, in particular, face serious risk with respect to CO2 control. Commenter says, flue gas separation is expensive and access to geological sequestration for smaller emitters is limited and costly. Commenter says, given the EPA's new rules for assuring ground water quality, the long-term risk to small operations is even more stifling. Commenter says, the lack of other options has driven these operations toward natural gas, with little possibility of future CO2 control. Commenter says, natural gas boilers emit less CO2 than coal per Btu, but without control, long-term CO2 release will continue unabated. Commenter says, natural gas, which has higher value uses in the production of fertilizer and in home heating, will continue to rise in price as demands increase, resulting in higher food, home heating and electricity prices. Commenter concludes, without options to mitigate CO2 emissions, the ultimate loser will be the consumer.
Commenter 0840 states, not-for-profit entities owned and controlled at the local level have their customers bear all associated costs of complying with environmental regulations and therefore cannot risk spending significant sums of money on risky or unproven technologies that could increase electric rates.
Commenter 9422 states, only NGCC turbine units can comply with the proposed CO2 limit and that the regulation should take into account the availability of natural gas in all areas of the country. Commenter says, a detailed analysis of current natural gas availability throughout the country and the availability of geological formations that may be suitable for CCS, when it becomes available as a viable control technology, is needed before a regulation is promulgated.
Commenter 6871 states, new coal generating plants can serve as the platforms for CCS development when second-generation technology is available at lower costs. Commenter says, data show first generation CCS technology would raise electricity costs by 80%.
Commenter 9774 states, EPA cannot rely on natural gas fired generation in demonstrating that CCS for the coal-fired NSPS is feasible or achievable. Commenter says, EPA claims that CCS is achievable because no new coal-fired generating units will be built in the foreseeable future and that instead the industry will only build natural gas-fired generating units so CCS will not be needed. Commenter says, the NSPS must be set on what can be achieved for the coal-fired generation source category and not be based on the assumption that this generation will be replaced by natural gas. Commenter says, EPA relies on future potential conditions in the analysis in determining that the NSPS is feasible and that EPA does not consider, for example, that the cost of natural gas may rise, making the installation of coal-fired generation necessary. Commenter says, EPA further substantiates the proposed coal-fired NSPS by saying that natural gas generation can be placed anywhere that CCS is not feasible. Commenter says, in making its determination, EPA cannot make these caveats and assumptions instead it must simply evaluate whether CCS is presently available and achievable for construction of new coal-fired electric generating units where coal-fired generation is currently operating.
Commenter 9774 states, EPA's approach in assuming that all new electricity can be generated from natural gas is a dangerous precedent. Commenter says, widespread replacement of coal-fired generation with natural gas may result in an over-reliance on natural gas generation, which can affect electric reliability and cause significant added cost to the residential, commercial and industrial users of natural gas.
The EPA's modeling, conducted using the Integrated Planning Model (IPM), as well as modeling conducted by the U.S. Energy Information Administration (EIA) showed that new generating capacity built through the period of analysis would be in compliance with the standard even in the absence of the regulation. This finding held true even under a number of alternative scenarios, including a range of natural gas prices. As a result, the EPA projected there would be negligible costs, benefits, or energy impacts associated with the rule in the period of analysis. Moreover, comments (6871, 7977) projecting price increases of 40-58% appear to be based on implementation of full CCS, which is not the basis of the standard, and are far higher than predicted increases for the final standard.  See preamble Table 8.

Commenter 10036 questions the reliability of CCS.  The technology is performing admirably at full scale at Boundary Dam.  POWER magazine recently voted Boundary Dam its power plant of the year (Aug. 1, 2015)(available in the docket for this action).  Among the findings that supported this award:

   * When the staff I met with talked about the first CO2 capture in September, they still exuded excitement. That first, successful attempt to capture the gas -- which happened at 1 a.m., with a control room packed with onlookers -- went so smoothly that they still seem surprised. The first sale of CO2 occurred October 1.

   * On February 11, SaskPower issued a press release concerning preliminary performance data from BD3. Mike Monea, SaskPower's president of carbon capture and storage initiatives, was quoted as saying, "The project is generating vast amounts of data never before available to scientists and engineers around the world, and the numbers are very impressive."

   * Approximately 135,000 mt of CO2 had been captured between the project's official launch and February. CO2 purity was virtually 100% (4.5% better than expected), while the parasitic load was 10 MW lower than expected

   * SaskPower notes that this first-of-its-kind carbon capture plant was finished on budget; challenges associated with the existing power plant were the cause of cost overruns

See also responses on this issue in RTC 6, noting the NETL (July 2015) assessment that compression and capture technology is highly reliable.
Affordability and reliability in Alaska
Commenters (7893, 10022, 10504) comment on the proposed rule's effect on affordability and reliability in Alaska.
Commenter 7893 states, the proposed GHG NSPS will further increase the high costs of electricity already borne by Alaskans, especially those in remote roadless villages and in the Fairbanks-Interior region of the state. Commenter says, as it stands, uncertainty associated with fuel prices and regulatory compliance costs make it difficult to provide effective solutions to reduce the cost of electricity for Alaskans. Commenter says, the proposed NSPS for GHG emissions from EGUs does not facilitate needed solutions to Alaska's high energy rates; in fact, it further inhibits development and technological improvements to the Alaskan power sector.
Commenters (7893, 10022) state, natural gas is not readily available nor is it cost effective to all parts of Alaska. Commenters say, the EPA justifies GHG NSPS based on available and inexpensive natural gas in the U.S. for power generation. Commenters say, while this may be true for utilities located in the contiguous 48 states, this is not the case for most of Alaska. Commenters say, although natural gas is currently available for heat and electric generation in the city of Anchorage and surrounding areas and some locations in the Kenai Peninsula, natural gas is either not available or uneconomic for power generation in Interior Alaska and in the remote communities/villages.
Commenters (7893, 10022, 10504) state, requiring new EGUs in Alaska to install and operate partial CCS will constrain a utility's ability to provide affordable power. Commenters say, the EPA states that utilities can easily choose the more economical NGCC technology over solid fossil fuel-fired EGUs with partial CCS. Commenters say, this option may be more economical where cheap natural gas is available in the U.S. Commenters say, natural gas is neither cheap nor available in the Interior and remote villages of Alaska. Commenters say, fuel and fuel transport costs are the primary drivers of elevated energy prices in these areas. Commenters say, as a result, there are few economical energy options.
Commenters (7893, 10022) state, coal is the least expensive and most abundant fuel for heat and power generation in the Interior. Commenters say, utility operators have obligations to customers to provide affordable power. Commenter says, energy costs in the Interior can be lowered by replacing or building new efficient coal-fired EGUs and cogeneration plants. Commenter says, the proposed EPA rule would have the opposite effect as it would eliminate the Interior's most affordable power source. Commenter says, energy costs would increase with the requirement to install and operate partial CCS systems, with their admittedly high capital costs for installation, operation, and maintenance.
Commenter 10504 states, the GHG NSPS, as proposed, has the effect of inhibiting the acquisition of newer more efficient coal-fired generating units to replace older less efficient coal-fired technology. Commenter says, in the interior of Alaska energy costs can be lowered by replacing or building newer, more efficient, coal-fired EGUs and cogeneration plants. Commenter says, ultimately, the installation and operation of partial CCS systems would be required by new coal units to ensure compliance with the standard. Commenter says, CCS installation would not only add to the capital cost of a new EGU, but add to the cost of operation and maintenance. Commenter says, the consumer would absorb the increase in cost through elevated electric rates. Commenter says, as it stands, the electric rates for consumers in interior and rural Alaska are some of the highest in the country.
Commenter 7893 states, Alaska's electric system is unique compared to the contiguous Lower 48 states and Alaska-specific considerations are necessary for these unique circumstances. Commenter says, Alaska electric utilities will be negatively impacted by an indiscriminate approach to environmental regulations based on erroneous assumptions that inexpensive natural gas is available and that there are robust electric grid systems like those in the contiguous 48 states. Commenter says, Alaska's diverse and isolated electric grid systems are not in the same category as interconnected contiguous US electric systems.
Commenter 7893 states, impacting the reliability of Alaska's electric utility sector puts the safety of all Alaskans at risk. Commenter says, the most important job of Alaska electric utilities is to provide reliable electric service to our communities through the extreme cold, lengthy and dark winter months. Commenter says, reliable electric service is a critical life and safety concern of every Alaskan. Commenter says, unlike interconnected utilities in the contiguous U.S., Alaska utilities do not have the option of relying on an integrated grid system for backup support. Commenter says, Alaska electric utilities have enough challenges with generating and distributing reliable power without the burden of the GHG NSPS where natural gas is not available. Commenter says, the cost of partial CCS will be exorbitant and cannot be supported by the state's small population that is spread over a vast land.
The EPA's modeling, conducted using the Integrated Planning Model (IPM), as well as modeling conducted by the U.S. Energy Information Administration (EIA) showed that new generating capacity built through the period of analysis would be in compliance with the standard even in the absence of the regulation. This finding held true even under a number of alternative scenarios. As a result, the EPA projected there would be negligible costs, benefits, or energy impacts associated with the rule in the period of analysis. Additionally, there are not expected to be impacts to reliability.
Affordability and reliability in Texas (ERCOT)
Commenters (1695, 3107, 5512, 9423, 9777, 10965) provide comments regarding the impact of the proposed rule on affordability and reliability in Texas.
Commenter 1695 states, as an economic developer from the Rio Grande Valley region that includes the first and third poorest MSAs in the country, according to the U.S. Census, he is concerned with the impact these new standards will have on electricity rates. Commenter says, our region cannot afford higher rates and quite frankly, for the outcomes stated above, neither can the State of Texas.
Commenter 3107 states, Texas, and especially north Texas, is a fast-growing and economically vibrant region. Commenter says, continued economic growth depends on a reliable supply of low-cost electrical power. Commenter says, recent reports by ERCOT and NERC express concerns about the Texas power grid maintaining power reserve margins adequate to avoid power shortages over the next several years. Commenter says, primary power adequacy concerns reflect high summer demands with heavy air conditioning loads. Commenter says, however, in January, Texas power consumers received a startling wake-up call when ERCOT came surprisingly close to implementing rolling power outages because of extreme cold temperatures and unexpectedly high demand. Commenter says, regulations that restrict development of new power plant construction, such as EPA's proposed greenhouse gas rules, could lead to further diminution of the Texas power grid's ability to meet consumer demand. Commenter says, this is a threat to Plano's businesses that depend on this power to be there when they need it.
Commenter 3107 states, with an economy growing almost 50% faster than the national average in 2012, and much of this growth in north Texas, including the city of Plano, it's critically important that EPA' s actions don't restrict continued critical access to low-cost dependable power. Commenter says, in light of potential decreased power availability and increased power costs, negatively impacting Plano Chamber members, as well as the surrounding communities we serve, we recommend that EPA either withdraw its proposed greenhouse gas regulation for new power plants, or set the emissions standard to a level that can be achieved by newly constructed power plants using existing demonstrated and commercially available technology.
Commenter 5512 states, North Texas, and especially Frisco, is a fast-growing and economically vibrant region. Commenter says, continued economic growth depends on a reliable supply of low-cost electrical power. Commenter says, recent reports by ERCOT and NERC express concerns about the Texas power grid maintaining power reserve margins adequate to avoid power shortages in upcoming years - both during summer and winter months. Commenter says, regulations that restrict development of new power plant construction, such as the EPA's proposed greenhouse gas rules, could lead to further diminution of the Texas power grid's ability to meet consumer demand. Commenter says, this is a direct threat to Frisco's businesses that depend on this power to be there when they need it. Commenter adds, where demand increases beyond supply, simple economics dictates that power prices will increase. Commenter says, under the EPA's proposed new regulations, increased power costs could become the norm throughout many portions of the country, including Texas and Frisco specifically. Commenter urges the EPA to not allow reduced power capabilities and increased power costs to occur. Commenter says, the position of the Frisco Chamber of Commerce is shared by other business organizations, including the Texas Association of Business and the US Chamber of Commerce.
Commenter 9423 states, decreased fuel diversity in the electric power generation industry will have adverse consequences for affordable and reliable electric power in the nation. Commenter says, decreased affordability and reliability of the power system poses risks to public health, safety, and to the economy.
Commenter 9423 states, decreasing the fuel diversity in the electric power generation industry and relying too heavily on one particular fuel source will have adverse consequences on the national electrical power system, both in terms of reliability and affordability. Commenter says, recent gas delivery issues in northern states have shown that an over-reliance on one fuel type can lead to severe short-term price dislocations, and in some cases, curtailment of generation due to fuel deliverability issues. Commenter says, an unreliable or unaffordable power system would have serious effects on public health and safety, especially for vulnerable low-income populations. Commenter says, just a few examples of the effects of an unreliable power system include a lack of adequate lighting, heating, or cooling for homes, and lack of appropriate refrigeration, cooking, or sanitation facilities. Commenter says, all of these conditions could lead to injury or disease. Commenter says, essential service providers such as hospitals, police departments, water and sewer utilities, fire departments, and others also depend on having reliable electricity to fulfill their necessary duties that keep people alive and protect citizens against danger.
Commenter 9423 states, businesses in Texas and across the nation are critically dependent on the reliable delivery of reasonably-priced electricity to support their operations. Commenter says, an unreliable or excessively costly power system would have major adverse impacts on productivity and business revenue.
Commenter 9423 states, the ERCOT grid in Texas is unique in the United States in that it is wholly intra-state and essentially isolated from the two other U.S. grid interconnections. Commenter says, additionally, regulatory changes can have a different impact on market prices and reliability in the ERCOT region than in other regions of the country due to the energy-only nature of the ERCOT market.
Commenter 9423 states, the federal EPAct05 recognized the importance of ensuring reliability of electric grids by creating an Electric Reliability 0rganization ("ERO"). Commenter says, the ERO function is performed by the North American Electric Reliability Corporation (NERC), which oversees a vast set of reliability standards that govern operations and planning and are designed to ensure the reliability of the bulk power system. Commenter says, under the NERC reliability construct, ERCOT is designated as both the Reliability Coordinator and the Balancing Authority, and as a Transmission 0perator for the ERCOT Region. Commenter says, ERCOT is also registered for several other functions, including the key planning function of Planning Authority. Commenter says, the Texas Reliability Entity, Inc. monitors and enforces compliance with reliability standards for NERC, develops regional standards, and monitors and reports on compliance with the ERCOT Protocols.
Commenter 9423 states, the ERCOT grid is unique in the United States in that it is wholly intra-state and essentially isolated from the two other U.S. grid interconnections (the Western and the Eastern Interconnections). Commenter says, the ERCOT grid is not synchronously connected outside of the state, and there is limited ability for the ERCOT region to import or export electricity. Commenter says, there are 5 asynchronous ties between ERCOT and other interconnections: two linking ERCOT and the Eastern Interconnection (with a combined capacity of 820 MW), and three linking ERCOT and the electrical grid in Mexico (with a combined capacity of 286 MW). Commenter says, flows on these asynchronous ties are scheduled by market participants. Commenter says, ERCOT can request support from neighboring regions during grid emergency events. Commenter says, Aside from these limited asynchronous ties, from an electrical standpoint, the ERCOT region is an island that must independently ensure its own electric reliability.
Commenter 9423 states, generating capacity in the ERCOT region consists of a mix of generation technologies, fueled by coal (both lignite and sub-bituminous), natural gas, nuclear, wind, and other sources. Commenter says, almost forty percent of the energy generation in the ERCO0T region comes from coal.
Commenter 9423 states, ensuring reliability requires a constant balance between supply and demand. Commenter says, unlike gas or water, electricity cannot be efficiently stored in large quantities - it must be generated to meet demand on a real-time basis. Commenter says, this means generation and transmission operations must be monitored in real time, 24 hours a day, to ensure a reliable and continuous flow of electricity. It is critical that ERCOT has enough generating capacity to meet demand at every given moment.
Commenter 9423 states, ERCOT must have and maintain adequate installed capacity to cover the forecasted load on the system as well as to ensure reliability in case of events such as higher- than-projected demand (e.g., due to extreme temperatures) or unplanned generation outages (e.g., due to mechanical breakdowns), and limited generation from variable resources. Commenter says, reserve margins reflect a snapshot of existing and currently planned generation resources in excess of forecasted peak demand as a percent of that forecasted peak demand. Commenter says, having a sufficient reserve margin is necessary to ensure reliability in the case of these events that are outside of normal planning assumptions. Commenter says, in November 2010, the ERCOT board approved a minimum planning Reserve Margin target of 13.75 percent for the ERCOT region, based on the generally accepted industry criteria of limiting firm load shedding due to supply inadequacy to once every ten years.
Commenter 9423 states, ERCOT must also maintain a sufficient amount of generating capacity on-line in each hour to serve the load at that time, cover instantaneous variation in load and to instantaneously replace the generation from any generating units which suffer an unexpected maintenance disruption and are immediately disconnected from the electrical grid. Commenter says, this capacity is commonly referred to as operating reserves. Commenter says, when sufficient generation is not available to meet these requirements, ERCOT institutes a progressive series of emergency steps to address the problem. Commenter says, the initial stages focus on maximizing the use of supply resources and the later stages focus on the utilization of ancillary services provided by demand response. Commenter says, with respect to maximizing supply options, ERCOT notifies resource owners to make all generation capacity available and requests assistance from other grids. Commenter says, ERCOT's ability to import power from other regions is physically limited by the capacity of its direct current (DC) ties, which is approximately 1,106 MW. Commenter says, however, ERCOT is not entitled to any of that capacity. Commenter says, ERCOT has the right to request assistance, but there must be supply available in the adjoining region. Commenter says, in addition, there must be transmission capacity available to accommodate the import.
Commenter 9423 states, ERCOT has two demand-response programs that can be utilized in grid emergencies to reduce the amount of load connected to the grid in order to balance load with available generation. Commenter says, ERCOT typically procures as much as 1,400 MW of Load Resources and approximately 450 MW of Emergency Response Service (ERS); these programs are utilized by ERCOT in the second and third stages of a grid emergency to maintain system stability. Commenter says, when all of these operational tools are exhausted, ERCOT implements firm load shedding through the use of rotating outages. Commenter says, the progression of these stages is indicative of increased system stress related to increasing demand against decreasing operating reserve margins.
Commenter 9423 states, at any given time, available generating capacity is typically less than the theoretical maximum, for a variety of reasons. Commenter says, for example, all plants have planned and unplanned maintenance outages that can render them unavailable. Commenter says, available generating capacity in ERCOT changes daily and seasonally. Commenter says, it is lowest in the spring and fall when many plants are scheduled to be off-line for maintenance outages. Commenter says, on average, approximately 10,000 MW of generation capacity is unavailable during the spring and fall months due to scheduled periodic maintenance requirements. Commenter says, similarly, approximately 4,000 MW of generation capacity is typically unavailable at any given moment due to unplanned forced maintenance outages.
Commenter 9423 states, ERCOT typically experiences peak demand in the summer season (June-September). Commenter says, demand has been consistently increasing in Texas and is projected to steadily increase through 2023.
Commenter 9423 states, ERCOT administers the planning function for the ERCOT region. Commenter says, this function forecasts future peak demand and establishes transmission and supply requirements over the relevant period to maintain reliability of the electric grid. Commenter says, however, the ERCOT region, under state law, employs a competitive market construct for generation supply. Commenter says, in this environment, generation owners bear the risk of investment and decide when and where to build new generation, and whether to retire or idle existing generation, based on market conditions. Commenter says, ERCOT, the regulated transmission and distribution utilities (which provide only "wires" service and do not own or operate generation facilities), and the PUC do not have the authority to order generators to maintain or to add generating capacity. Commenter says, rather, the ERCOT market is designed to provide financial signals to competitive generation companies to ensure adequate generation capacity.
Commenter 9423 states, the ERCOT market is singular in that generating plants are paid only for the energy and the operational ancillary services they provide (commonly referred to as an energy-only market). Commenter says, as a result, regulatory changes can have a different impact on market prices and reliability in the ERCOT region than in other regions of the country.
Commenter 9423 states, this ERCOT energy-only market design has proven itself to be supportive of robust competition between generating technologies and fuel sources. Commenter says, a result of this market design is also that older, uncompetitive generating units tend to be retired more quickly, as units that do not operate are not able to earn any revenues. Commenter says, reserve margins in ERCOT have tended to be at or even slightly below the target reserve margin of 13.75 percent for the past few years.
Commenter 9423 states, in the ERCOT market, generation unit development decisions are made by independent investors, based on their analyses of market conditions and expectations of return on investment. Commenter says, as such, new investment in generating units will be made after the general market becomes aware of a system need. Commenter says, regulatory changes that result in significant changes in the market must have sufficient lead time so that the impacts can be assessed by the market and new investment can be made.
Commenter 9777 states, coal is a necessary fuel in the U.S. and ERCOT energy portfolio. Commenter says, given the recent history of extreme weather events in Texas, they remain concerned that power generation resources in Texas may be materially strained in an environment where regulation disincentivizes construction of new power generation, especially new coal-fueled generation. Commenter says, the demand for electricity in Texas has steadily increased in recent years. Commenter says, economic drivers in Texas have lead Texas energy demand (i.e., MWh produced) to grow 8% from 2005 to 2012. Energy demand is expected to continue to grow another 13% by 2020.
Commenter 9777 states, coal was a critical fuel during winter of 2013/2014. Commenter says, recent periods of extreme weather have threatened reliability and forced greater dependence on existing coal-fueled generation units. Commenter says, in Texas, the 2013/2014 winter saw extended cold weather across much of the State with ice and snow occurring as far south as Houston. Commenter says, meanwhile, in the Northeast, the demand for natural gas to heat homes has caused electricity prices to rise dramatically.
Commenter 9777 states, the EPA is wrong that natural gas can adequately replace coal-fueled units to satisfy the U.S. energy demands. Commenter says, the EPA's rule proposal, evidences EPA's belief that even if coal-fueled construction may not be practicable or economical because of the higher cost of CCS, basing the standard on an achievable emission rate is valid because "the basic demand for electricity could still be served by NGCC . . ." See 79 Fed. Reg. at 1481. Commenter says, this reliance on natural gas to replace new coal-fueled generation construction, combined with the real likelihood of existing coal-fueled generation retirement (driven by the Mercury Air Toxics Standards and other regulations) will leave the U.S. increasingly dependent on natural gas to power and to heat homes, resulting in an increased cost of living for millions of Americans.
Commenter 9777 states, reducing the electricity supply during a time of steady demand growth through imposition of additional regulatory requirements on new coal-fueled generation, existing coal-fueled generation, and natural gas-fueled generation presents a real and significant risk to the reliability of the ERCOT grid, especially during spells of extreme weather. Commenter says, with the reliability issues already faced by the existing generation fleet, any regulation of existing units or modified units could place immediate and acute stress on the grid and exacerbate reliability concerns.
Commenter 9777 states, moreover, this regulation does not actually reduce existing GHG emissions; rather, it avoids GHG emissions attributable to new coal plants in the future. Commenter says, thus, this regulation is not expected to have any measureable effect on global temperatures. Commenter says, the EPA's final rule must balance the benefits of maintaining coal-fueled power as a part of a diverse fuel portfolio against the adverse consequences that may result from extreme weather as observed this past winter.
Commenter 10965 states, the EPA has failed to adequately consider the negative impacts the GHG NSPS would have on the availability of reliable and affordable electricity in many parts of the nation, including Texas. Commenter says, the EPA states that the GHG NSPS will have no adverse effect on the availability of reliable and affordable electricity based on its assertion that under the current energy market, no new coal-fired electric generating units will be constructed within the next eight years. Commenter disagrees. Commenter says, it is not clear that absent EPA's adoption of the GHG NSPS, no new coal-fired electric generating units will be constructed within the next eight years. In fact, Commenter believes that additional coal-fired electric generating units will be needed to ensure the continued availability of reliable and affordable electricity, at least in Texas. Commenter says, in light of that, and since the GHG NSPS will effectively prohibit the construction of new coal-fired electric generating units, the GHG NSPS would have an adverse effect on the availability of reliable and affordable electricity in Texas, as well as other parts of the nation.
As EPA has made clear in previous responses, EPA disagrees with these remarks because this rule will not limit diversity or threaten reliability.  EPA did not assume current energy market conditions would remain in the future.   Instead EPA carefully examined the potential for new coal through 2022 in IPM modeling, consulted independent projections from the Energy Information Administration, and analyzed historical trends in the use of coal (See the TSD in this Docket, "Trends in the Structure of Electric Power Sector Limiting Amount of New Coal".) Additionally, the RIA presents information from EPA's own modeling as well as EIA for 2020 and beyond that supports the conclusion that all new generating capacity constructed in the baseline will be in compliance with the standards, even in the absence of the rule. See RIA Chapter 4.
Affordability and reliability in Florida
Commenters (9320, 9661) provide comments on the impact of the proposed rule on affordability and reliability in Florida.
Commenter 9320 states, the EPA has not adequately considered all the costs of CCS. Commenter says, because EPA's proposal effectively precludes coal-fired generation from ever being cost-effective, it is also decreasing fuel diversity as reliance on natural gas grows. Commenter says, as a result, Florida and its residents will increasingly be at the mercy of changes in fuel costs, which history demonstrates can be volatile. Commenter says, moreover, there will be impacts on jobs, especially as existing coal-fired generation is retired (an eventuality EPA is hastening with its Mercury and Air Toxics rule and other regulations) and replaced, with little to no potential for new coal-fired generation. Commenter says, this is because coal-fired generation is more employment intensive than natural gas-fired generation on a megawatt basis.
Commenter 9320 states, the EPA's elimination of new coal-fired generation in Florida threatens electric reliability. Commenter says, the EPA's proposal effectively precludes new coal-fired generation in Florida, due to the obligation to include CCS. Commenter says, contrary to EPA's assertion, this is not appropriate, reasonable, or harmless in relation to Florida's unique circumstances, particularly as regards consequences for electric reliability in Florida. Commenter says, the EPA must analyze these circumstances and allow an opportunity for comment. Commenter says, the EPA concludes that its proposal would not prevent basic electrical demand from being met since natural gas-fired combined cycle plants could be built in areas where new coal-fired generation is effectively precluded. Commenter says, but, this overlooks the reliability issues posed by overreliance on natural gas-fired generation that is dependent on fuel supplied from sources subject to significant disruptions. Commenter says, Florida is uniquely situated in this regard and EPA must not preclude generation types necessary to meet the reliability needs of any given geographic area.
Commenter 9661 states, the proposed rule severely limits the prospects of coal-fired generation and will exacerbate an evolving imbalance in fuel diversity in Florida. Commenter says, therefore, the proposed rule will have adverse impacts on electrical reliability. Commenter says, they are concerned that the proposed implementation timeframe unnecessarily increases the reliability risk in the following ways: (1) over-reliance on natural gas in Florida; (2) reduced fuel diversity; (3) reduced operational flexibility due to proposed stringency in applying combined cycle standard to simple cycle operation for units capable of both cycles of operation. Commenter says, as the power industry in Florida contemplates what to modify, control and build in the future, and in ord.er to ensure a reliable, affordable supply of electricity in the future, the full suite of generating options will need to be relied upon. Commenter says, choosing to build natural gas-based plants now does not mean that utilities would not want to build new, efficient advanced coal-based units in the future for any number of reasons not included in EPA's analysis. Commenter says, the historical pattern of natural gas prices in the U.S. is one of volatility, not stability. Commenter says, this rule could result in significant economic impacts to residential and commercial customers, particularly minorities, elderly and economically disadvantaged customers.
EPA is not precluding the construction of new coal-fired generation, and the rule includes the flexibility to promote construction of new coal capacity with technology to meet the requirements.  For example, there are multiple compliance pathways to meet the final standard of performance, including compliance options that are not dependent upon use of CCS. Also, this rule only applies to new sources of base load and intermediate load electricity, and does not affect existing sources.  EPA's projections show that the nation's electric generating mix will continue to be diverse, with coal accounting for a substantial share of generation well into the future (this finding is corroborated by EIA and many other independent forecasting groups).  Finally, EPA explored scenarios using alternative assumptions with considerably higher future electric demand and higher natural gas prices, and no scenario resulted in new conventional coal by 2020.  Independent analysis and projections from EIA confirm this trend. EPA does not project any change in energy prices as a result of this rule, and as such does not expect negative impacts on the affordability or reliability of electricity. See RIA Chapter 4.
Affordability - rural, fixed income, low income, seniors, veterans
Commenters (2864, 4814, 4926, 4927, 8032, 9407, 9735, 10086) provide comments on the impact of the proposed rule on the affordability of electricity for rural consumers, and for fixed income, low income, seniors, and veterans.
Commenter 2864 states, many industry members, including those who have testified before us, project that utility customers could see dramatic increases in their rates as a result of these rules being enacted. Commenter says, utilities have stated that rates could increase 30 to 45 percent depending on the goals and timelines established. Commenter says, if a significant amount of additional coal-fired EGUs are shut down in this country, customers will pay not only the costs of shutting down these EGUs but also the costs of replacing them. Commenter says, asking customers to pay for plants that have remaining useful life is not a wise use of resources. Commenter says, furthermore, significantly increasing the costs of power will have a serious impact on the economy as the costs of goods and services will correspondingly need to increase. Commenter says, this will be particularly hard on the millions of jobless people and people living on fixed incomes in our country. Commenter says, the U.S. economy is still weak and many Americans are suffering. Commenter says, federal regulators need to be extremely methodical in approving new rules that could further weaken the economy.
Commenter 4814 states, increased electricity costs will likewise affect household incomes and measures should be in place to assist ratepayers who are least able to afford such increases in the cost of electricity to ensure that basic quality of life decisions do not become more complex.
Commenters (4926, 4927) state, the proposal puts at risk the ability to provide an abundant, reliable and affordable future electricity supply upon which our residents and industries can rely. Commenters say, a proposed rule of this nature effectively removes coal from consideration as a source of electricity for the growing energy demands of our state and nation because it sets unattainable standards. Commenters say, over 80% of Indiana's electricity is generated from units powered by coal. Commenters say, Indiana's low electrical rates, which are primarily fueled by coal, allow our state to rank as one of the highest manufacturing states in the nation. Commenters say, if finalized as proposed, this regulation will most certainly cause hardships in meeting increased energy needs and will have potential to decimate our industries, cause extensive job losses, and send our manufacturing overseas.
Commenters (4926, 4927) state, the result of a rulemaking of this magnitude will raise and pass on future energy costs to consumers. Commenters say, energy prices have already increased as a result of recent EPA regulatory initiatives. Commenters say, even more increases in energy costs will affect all Hoosiers and be particularly detrimental to public facilities, as well as those citizens with fixed incomes or with low income. Commenters urge EPA to withdraw the proposed rule because it is fundamentally flawed and a defective approach to energy policy.
Commenter 8032 states, at current natural gas prices, a new natural gas combined cycle plant is less expensive on a life cycle cost of electricity basis than a new coal plant. Commenter says, the current break point for a new coal vs. new gas is approximately when natural gas cost rise above $6 per mmBTU. Commenter says, if CO2 capture is required for new coal plants, then the breakeven point will be when the natural gas cost exceeds $12 per mmBTU. Commenter says, this will create a significant increase in electricity prices and practically every consumer product price as a result. Commenter says, the cost for CO2 capture will significantly increase the cost of producing electricity. Commenter says, for cost of service provider with limited customers per mile electricity cost for our members will increase significantly and disproportionally high when compared to investor owned utilities with more customers per mile. Commenter says, the economy in rural America particularly cannot afford to suffer this type of impact nor can the economy as a whole.
Commenter 9407 states, the facts about rural America's energy needs and usage exemplify why Commenter feels the EPA should keep their regulatory initiatives reasonable and their impacts on the rural electric consumer cost of electric service affordable. Commenter's concern is whether the rural electric consumers can reasonably afford their electric service under this proposal. Commenter says, even assuming EPA's unrealistically low cost assumptions under this proposal are valid, the rule would set national electricity energy policy for years to come by absolutely ensuring coal-based generation would be the most expensive new base-load generation option and likely too expensive as a realistic future generation option. Commenter says, consistent with Portland Cement v. EPA 665 F.3d 177 the EPA is required to take into account energy impacts and include a discussion of the proposal's impacts. Commenter thinks the countervailing factor of leaving the nation with one choice, natural gas, for most all new baseload generation weighs heavily against any proposal, like this one, that eliminates the coal option for nation's future energy mix. Commenter says, and yet the rulemaking docket lacks any disclosure that EPA considered this broader national policy implication of a one fuel baseload option.
Commenter 9735 states, ratepayers, or consumers, seemed to have played no real role in your consideration of this rule. Commenter says, if they had, we would have a seen greater attention paid to the outsize burden of this rule that would be placed on the backs of consumers across the country. Commenter says, experts on the issues of CCS that have actually looked at this, some within the same Administration, have stated that the pass through electricity costs to consumers of this proposed rule would be astronomical. Commenter says, Dr. Julio Friedmann, Deputy Assistant Secretary for Clean Coal at the Department of Energy, stated at a recent hearing before the House Energy and commerce committee that prices could rise as much as 80%. Commenter says, in some areas of the country where the current price per megawatt hour is lower than average, this cost increase could be even more significant. Commenter says, the EPA's failure to truly reflect this increased cost to consumers is a concern as I look at many residents in my state; middle-class, low-income, seniors, veterans, who can't afford such a rate hike, or would be forced to choose between electricity and other essential needs.
Commenter 10086 states, it is extremely troubling to see EPA's obvious failure to recognize the vital role of the electric utility industry in maintaining the health and well-being of the American people and to provide for balanced regulation. Commenter says, such a comparison might well be an example of how out-of-touch the agency is with regulation of the utility industry! Commenter says, electricity service is a life staple for residential consumers, in many rural areas a matter of life and death. Commenter says, certainly for many electric cooperative consumers, any increase in electricity costs must be compensated for by curtailing expenses somewhere else in the family budget. Commenter says, for this reason, we believe any potential increase in the cost of electric service should be closely linked to rational and realistic justification.
EPA is not precluding the construction of new coal-fired generation, and the rule includes the flexibility to promote construction of new coal capacity with technology to meet the requirements.  For example, there are multiple compliance pathways to meet the final standard of performance, including compliance options that are not dependent upon use of CCS. Also, this rule only applies to new sources of base load and intermediate load electricity, and does not affect existing sources.  It is not based on full CCS  -  the basis for the cost estimates in comment 9735, and necessarily is not associated with the electricity cost increases reflecting use of full CCS. EPA's projections show that the nation's electric generating mix will continue to be diverse, with coal accounting for a substantial share of generation well into the future (this finding is corroborated by EIA and many other independent forecasting groups).  Finally, EPA explored scenarios using alternative assumptions with considerably higher future electric demand and higher natural gas prices, and no scenario resulted in new conventional coal by 2020.  Independent analysis and projections from EIA confirm this trend. EPA does not project any change in energy prices as a result of this rule, and as such does not expect negative impacts on the affordability or reliability of electricity. See Chapter 4 of the RIA.
Affordability and reliability for farmers and ranchers
Commenters (3236, 8742, 8906, 9193) comment on the proposed rule's effect on affordability and reliability for farmers and ranchers.
Commenters (8742, 9193) state, farming is an energy-intensive business. Commenters say, farmers depend on reliable and affordable sources of energy to run their daily operations, including their tractors, grain-drying systems, and livestock barns among many other uses. Commenters support the availability and affordability of all sources of energy, including traditional (coal, gas, nuclear) and alternative (wind, solar, and other) sources. Commenter says, the availability of reliable electric service at a reasonable cost is critically important to our members and to Iowa's economy. Commenter says, the proposed standard for greenhouse gas emissions is therefore of great interest to farmers. Commenter says, one of the toughest challenges farmers face is dealing with the obstacles and variability Mother Nature often hands us. Commenter's grassroots membership supports policy opposing the regulation of greenhouse gas emissions. Commenter says, imposing added energy costs on our own economy while other countries are not held to the same standard puts U.S. producers and consumers at a disadvantage and serves little environmental purpose. Commenter says, in the end, merely reducing fossil fuel emissions without producing a measurable impact on world temperatures or climate cannot be regarded as a success. Commenter says, energy-related CO2 emissions from the United States have been falling since 2007, further raising our membership's concern over this proposed unilateral action.
Commenters (3236, 8742, 8906, 9193) state, the proposed standard does not provide the certainty that farmers and producers need in order to assure that they will continue to receive an affordable and reliable supply of energy. Commenters say, the EPA indicates there will be significant costs for utilities to comply with the new standards. Commenters say, the costs utilities will incur in order to comply with the new standards will be passed on to their customers - in many cases, farmers and ranchers. Commenters say, farmers and ranchers cannot set prices for their products (they are price takers and not price makers), so they lack the ability of many other sectors of recouping their costs by passing them on to customers. Commenters say, higher energy costs for farmers and ranchers mean higher farm input costs.
Commenter 3236 states, coal is an inexpensive, abundant and reliable source of energy in many parts of the country - the very type of electricity source that agriculture needs in order to remain viable and competitive in world markets. Commenter says, for farmers and ranchers in a large part of the country, coal supplies all or most of their electricity. Commenters (3236, 8906, 9193) say, as coal plants in these areas age and are de-commissioned, they are concerned that there will not be a reliable and affordable source of electricity to take their place.
EPA is not precluding the construction of new coal-fired generation, and the rule includes the flexibility to promote construction of new coal capacity with technology to meet the requirements.  For example, there are multiple compliance pathways to meet the final standard of performance, including compliance options that are not dependent upon use of CCS. Also, this rule only applies to new sources of base load and intermediate load electricity, and does not affect existing sources.  EPA's projections show that the nation's electric generating mix will continue to be diverse, with coal accounting for a substantial share of generation well into the future (this finding is corroborated by EIA and many other independent forecasting groups).  Finally, EPA explored scenarios using alternative assumptions with considerably higher future electric demand and higher natural gas prices, and no scenario resulted in new conventional coal by 2020.  Independent analysis and projections from EIA confirm this trend. EPA does not project any change in energy prices as a result of this rule, and as such does not expect negative impacts on the affordability or reliability of electricity. See Chapter 4 of the RIA.
NGCC and reliability
Commenters (7976, 9381, 10135) comment on NGCC units and grid reliability
Commenter 7976 states, modern, fast response combined cycle plants can typically provide about half to two-thirds of their rated plant output onto the utility grid within 10 minutes of the request of a hot start, thus qualifying that output as spinning reserve capacity. Commenter says, the NERC sub-regions require non-spinning reserves but the requirements are typically only 2% to 3% of the overall system load. Commenter says, even if a 500 MW combined cycle plant can only add 250 MW to the system non-spinning reserve capacity, the addition would be adequate to serve system load growth of over 8,000 MW. Commenter says, the startup curve [Figure 3 in the comment letter] was filed with the California Energy Commission and the South Coast Air Quality Management District in 2012 in support of a new plant permit for the AES Huntington Beach Energy Project. Commenter says, the application is for a 480 MW combined cycle plant in a 3x1 configuration. Commenter says, the curve is representative of how fast a modern combined cycle plant can start up.
Commenter 7976 states, utilities also need to support transmission grid reliability with system inertia, area voltage support, spinning reserves and/or load following capacity. Commenter says, these capabilities require the plant to be operating and synchronized to the grid while remaining available for long periods of time to provide power output ramping services. Commenter says, this means that it is generally more economical and more environmentally responsible to use efficient combined cycle (in lieu of simple cycle) generation resources to support transmission grid reliability with inertia, spinning reserve and load following capabilities.
Commenter 7976 states, precisely maintaining the balance between energy supply and demand is critical to grid reliability. Commenter says, recently, some electric utilities and transmission balancing authorities have expressed concern that high market penetration of renewables like wind turbine plants and solar energy plants will require firm back up resources to be capable of ramping rapidly to offset rapid, unexpected changes in the unpredictable output of the wind and solar resources. Commenter says, to maintain the grid's reliability, the grid's balancing authority needs to have flexible resources standing by; i.e., gas fired resources that can be reliably dispatched to ramp up or ramp down quickly in response to sudden changes in the wind or solar output. Commenter says, fortunately, modern combined cycle power blocks currently offered by GE, Siemens and others can ramp up and down for load balancing purposes rapidly like simple cycle GTs; typically at a rate of ~20% of rated plant capacity per minute. Commenter says, operating examples of such fast response combined cycle plants include the NCPA Lodi Energy Center and the NRG El Segundo Energy Center in California.
Commenter 7976 states, it is ironic that some sponsors propose to construct simple cycle capacity to backstop unreliable renewable resources rather than combined cycle capacity. Commenter says, the irony is that in forgoing the steam turbine capacity of a combined cycle plant, the sponsor is forgoing a "renewable" resource that is far superior to the wind or solar resources it supports. Commenter says, like wind and solar energy, the added steam turbine capacity does not require additional fossil fuel to produce electricity. Commenter says, and, compared to wind and solar, the steam turbine capacity has a much lower capital cost, is much more reliable and can be dispatched as needed.
Commenter 9381 believes that any new source standard should be set in a way that recognized that market dynamics may shift in the future in ways not currently anticipated.  Commenter says, for example, with increased penetration of renewable energy sources, fossil fuel-fired electric generating facilities are likely to increase cycling (e.g. starting and stopping more frequently to respond to fluctuating demand).  Commenter says increased cycling of these units reduces their efficiency and increases their output-based CO2 emissions rate.  Commenter says natural gas combined-cycle (NGCC) units can provide limited ancillary and peaking services through duct firing and power augmentation to the turbine.  Commenter concludes, while they are not a substitute for simple-cycle turbines, this flexibility is important for grid function and reliability.
Commenter 10135 states, the timing of these regulations could not be worse given the cumulative cost burdens to the development of new combustion turbine/gas turbine and combined cycle generation represented by additional requirements for permitting, emissions controls, compliance reporting and other associated requirements. Commenter says, the impact of these regulations is coming at a time when coal-fired generation is in decline, the future of nuclear generation is questionable, and renewable resources are not developing at a fast enough pace which presents a real and significant threat to future reliability.
In general, these comments support the principle that NGCC units are good sources for supporting the grid in terms of inertia, spinning reserve and load following.  EPA agrees with these comments.
Simple-cycle combustion turbines and reliability
Commenters (8952, 10052, 10239) comment on simple-cycle combustion turbines and reliability.
Commenter 8952 states, because simple cycle gas turbines cannot comply with emission limits that apply to units exceeding the one-third capacity and net output thresholds, they will be forced to adopt this arbitrary cap on their generation. Commenter says, nowhere in the record has EPA analyzed the effects of its changed proposed position on the existing fleet or future fleet of simple cycle gas turbines. Commenter says, nor has EPA considered the well-documented future demands anticipated in the energy markets and how barring reliance on simple cycle generation will affect energy markets, grid reliability and CO2 emissions under this rule.
Commenter 10052 states, based on their experience in operation of variable (renewable) and baseload (coal, nuclear, natural gas and geothermal) generation, they have frequently utilized their natural gas facilities to provide valuable peak and load-following generation. Commenter says, in order to ensure the continued deployment of renewable generation, they believe it is critical for the EPA to carefully examine the potential consequences of its proposed GHG NSPS for all new fossil-fueled electric utility generating units. Commenter says, the ability of simple-cycle combustion turbines to achieve a NSPS becomes an even more critical issue to ensure grid reliability as utilities ramp up integration of renewables to meet existing and future renewable portfolio standards and to reduce their carbon footprint. Commenter says, while EPA finds that historically simple-cycle combustion turbines do not supply more than one-third of their potential electrical output to the grid, this is not necessarily the case in the Western U.S., and may not be the case nationally in the future as renewables integration becomes increasingly necessary.
Commenter 10239 states, the risk of electricity disruption and price volatility will be increased by the EPA's proposed regulation of simple cycle turbines that are designed to provide peaking power. Commenter says, unlike baseload NGCC turbines, simple cycle turbines are designed to respond quickly to changing conditions and ensure a consistent, stable supply of electricity despite short-term fluctuations in supply and demand. Commenter says, while the EPA properly excluded simple cycle turbines in the 2012 proposal because of their different purpose and operations [77 Fed. Reg. at 22,398] the EPA has now reversed course and proposed to regulate them in the same manner as NGCC turbines if they supply more than one third of their potential electric output to the grid over a three-year period.
Commenter 10239 states, these changes will infuse more uncertainty into the electricity sector. Commenter says, regardless of their intended use, simple cycle turbines must respond to fluctuating weather, abnormal power usage, increased reliance on intermittent renewable energy, and unexpected outages from other generators, all of which is beyond their control. Commenter says, thus, while there is a risk that a simple cycle turbine could exceed the applicability threshold, neither the operator nor its customers would know until after the 3-year compliance period has ended. Commenter says, to mitigate that risk, operators may add emissions controls proactively, subjecting customers to potentially unnecessary costs. Commenter says, alternatively, they may seek to curtail production as they approach the applicability threshold, exacerbating grid instability. Commenter says, in either case, the increased uncertainty for simple cycle turbines will have ripple effects that harm retail consumers.
EPA disagrees.  Existing units can still meet reliability needs, and new NGCC units are more cost-effective to supply the base load generation needed meet the full range of reliability needs going forward than are simple cycle turbines.
Effects of coal unit retirements on reliability and affordability
Commenters (1899, 4710, 7433, 7977, 8906, 8971, 9382, 9396, 9472, 9725, 10032, 2864) provide comments on the effects of coal unit retirements on reliability and affordability.
Commenter 1899 states, in the competitive market, current market power prices do not support making these capital investments, such as uneconomic heat rate improvements, that will likely lead to further shutdowns of coal plants. Commenter says, in the regulated market, all costs will be passed on to the customer, which will increase electricity rates.
Commenter 4710 states, a moratorium on new coal-fired power plant construction will greatly impact grid reliability and increase the risk of rolling power outages and brownouts. Commenter says, NERC has also stated that 25 gigawatts of fossil-fueled generation (enough power to heat 20 million homes) has been retired since 2011. Commenter says, during this year's "Polar Vortex," 89 percent of the coal capacity that is slated for retirement by a major power provider in the upper Midwest was called upon to meet electricity demand. Commenter says, the EPA's proposed rule will exacerbate this trend and threaten the ability of utilities to supply power during peaks in demand.
Commenter 7433 holds that instead of coal units slowly and systematically giving way to more efficient generation, this rule aggravates an already stressed capacity market without allowing adequate new firm base load generation capacity to be built to offset the retiring plants. Commenter says, with ensuring overall system reliability as an agency goal, they are concerned that the rule has the potential to undermine two critical components that are vital to overall system reliability: diverse resource generation and price stability.
Commenter 7977, states their analysis shows, with moderate to high probability related to known and projected coal-fired EGU retirements, 81 GW of coal-fired electricity generating capacity nationwide will be retired.
Commenter 8906 states, the EPA proposes a standard of 1,100 lbs. of CO2 per megawatt hour that it admits cannot be met by proposed new coal plants, and the net effect of this "policy" seems essentially to eliminate the approval of any new coal-fired powered plants in the future. Commenter says, coal is an inexpensive, abundant and reliable source of energy and is heavily utilized in Nebraska. Commenter says, as coal plants in these areas age and are de-commissioned, they are concerned that there will not be a reliable and affordable source of electricity to take their place. Commenter says, at a time when our country needs to consider all types of energy, the proposed standard appears to eliminate one of the most widely used and inexpensive sources of energy. Commenter says, any standard for utilities should be realistic and achievable for all sources of energy.
Commenter 9382 states, in light of the issues that developed during the Polar Vortex cold snap last winter, Hoosier Energy is concerned with grid reliability due to the numerous plant closures as a result of EPA's other rules targeting the coal-fired utility industry, including the Mercury and Air Toxics Standards (MATS), which will only increase if EPA promulgates a CO2 existing source performance standard under Section 11l(d). Commenter says, as recently noted by FERC, "a number of mid-winter cold weather events stressed the electricity markets. High loads stretched resources and several new records for winter peak loads were set. New winter peaks were observed in MISO, PJM, NYISO, and SPP." Commenter says, Terry Boston, PJM's President and CEO, has also raised concerns surrounding reliability and fuel diversity. Boston was recently quoted as saying "I worry about fuel diversity," noting that coal and nuclear plants are retiring in PJM and that 74% of new generation is gas fired. Commenter says, this proposal will only serve to exacerbate problems with reliability and fuel diversity by increasing dependence on a fuel that proved inadequate just months ago throughout the United States.
Commenter 9396 states, more recently, events in the US have proven these articulated concerns about reliability to be warranted and demonstrated both the fragility of the electric grid and the reliance of the grid on fossil fuel plants that are set to retire as a result of environmental regulations. Commenter says economist Dr. Bernard Weinstein testified before the House Science Committee:
"The utility industry is already laboring to comply with these and a myriad of other EPA mandates. The result could well be a reduction in reserve margins, making less power available during periods of peak demand or plant outages. Imagine what would have happened in Texas and other southern states that rely heavily on coal-fired generation during the record summer heat wave of 2011 and this year's "Polar Vortex" if adequate reserve power had not been available. Not only would many energy-intensive industries have been forced to shut down, but rolling blackouts could have put the public's health at risk in the face of 100 degree-plus or sub-freezing temperatures week after week.
"This prospect was highlighted by the Electric Reliability Council of Texas, which operates the state grid, who stated that likely production cuts to comply with the proposed CSAPR rules alone would have threatened the state's ability to keep the lights on. American Electric Power Company has stated it will retire nearly 6,000 MW of generating capacity if the CSAPR rule is reinstated while Duke Energy will shutter 862 MW and Georgia Power another 871 MW.
"Should the EPA promulgate costly GHG emissions reductions for existing coal-fired plants, even more generating capacity is likely to go offline, further weakening the integrity of the power grids in Texas and elsewhere. And ERCOT has stated that it expects consumption in its power region to increase by 39.4 percent from 2007 through 2025, at the very time compliance with these and other regulations may force plant retirements."
Commenter 9472 states that EPA regulations have contributed, so far, to the retirement or conversion of 380 existing coal units totaling over 51,000 megawatts of electric generating capacity in 33 states. Commenter says, these retirements pose increasing reliability challenges for the electricity grid and leave consumers exposed to higher energy prices. Commenter says, unfortunately, coal retirements could continue because of EPA's forthcoming CO2 regulations for existing power plants under section 111(d) of the CAA, as well as other pending EPA policies.
Commenter 9725 states, to maintain a diverse, reliable and affordable electricity grid, new higher efficiency coal units will be required to replace the retiring older coal, natural gas and nuclear electricity generation plants.
Commenter 10032 states, the proposed standard is unachievable. Commenter says, because of the state of current technology, new coal-fired plants cannot achieve the Proposed Standard of 1,100 lbs. of carbon dioxide per megawatt hour. Commenter says, new coal generation development will be impossible under the proposed standard. Commenter says, by EPA's admission, the proposed standard can only be met by natural gas combustion technology. Commenter says, this will eliminate future approval of any new coal-fired power plants. Commenter says, as coal-fired plants are decommissioned, it is our concern that no reliable and affordable replacement energy source will be available. Commenter says, coal is cheap, plentiful and reliable; the type of energy source agriculture and the rest of our country needs. Commenter says, the U.S. should consider all energy sources and set achievable and realistic goals.
Commenter 2864 states concerns in regards to the effects that shutting down a number of coal-fired EGUs will have on reliability. Commenter says, according to the most recent US Energy Information Administration 2014 outlook, 10.2 GW of coal-fired EGUs were retired in 2012 on top of the 23.4 GWs that have already been retired. Commenter says, it is expected that 39.3 GWs of additional generation will be retired between 2013 and 2023. Commenter says, there will also be 8.3 GWs of petroleum and 15.2 GW of natural gas generation retired during this time period as well which shows the rules have a much broader impact on the country's electric generation resources.
 EPA is not precluding the construction of new coal-fired generation, and the rule includes the flexibility to promote construction of new coal capacity with technology to meet the requirements.  For example, there are multiple compliance pathways to meet the final standard of performance, including compliance options that are not dependent upon use of CCS.  Also, this rule only applies to new sources of base load and intermediate load electricity, and does not affect existing sources.  EPA's projections show that the nation's electric generating mix will continue to be diverse, with coal accounting for a substantial share of generation well into the future (this finding is corroborated by EIA and many other independent forecasting groups).  Finally, EPA explored scenarios using alternative assumptions with considerably higher future electric demand and higher natural gas prices, and no scenario resulted in new conventional coal by 2020.  Independent analysis and projections from EIA confirm this trend. EPA does not project any change in energy prices as a result of this rule, and as such does not expect negative impacts on the affordability or reliability of electricity. See RIA Chapter 4.
Debt on existing coal-fired EGUs
Commenter 9592 has provided electric power to the city of Gainesville and surrounding area for over 100 years. Commenter says, as a municipally owned utility, we are charged with providing reliable and economic electric power in an environmentally responsible manner. Commenter says, to meet both the emission reductions and compliance timelines for the Cross State Air Pollution Rule (CSAPR) rule and the Utility Mercury and Air Toxic Standards (UMATS) rule, GRU has spent more than $146,000,000 to add a dry circulating SO2 flue gas scrubber, selective catalytic reduction (SCR) and a fabric filter at the 235 MW Deerhaven Generating Station Unit #2 (DH#2). Commenter says, our investment in this generating unit is over $400 million in today's dollars with a significant debt still remaining. Commenter says, we are concerned that some of the policy precedents established in EPA's GHG NSPS for new units will result in higher electric rates due to over-dependence on one fuel source.
Commenter 9592 states, in the 1970s many Florida generating utilities, including GRU, were heavily dependent oil-fired generation.  Commenter says, the oil embargo of the 1970s resulted in a dramatic increase in our electric rates. Commenter says, in response to the oil embargo, Congress passed the Electric Power and Industrial Fuel Use Act of 1977, which disallowed the use of natural gas and oil for any new electric generating units. Commenter's original contract for DH #2 was for a primarily oil-fired steam electric generating unit. Commenter says, the Fuel Use Act required GRU to completely redesign DH #2 from an oil-fired unit to a coal-fired generating unit. Commenter invested millions of dollars on a new coal-fired generating unit not just because we sought a reliable domestic fuel source, but because we had no other choice for a new generation other than cost prohibitive nuclear generation to serve our consumers. Commenter concludes, it is important that EPA understands that GRU still carries considerable debt on DH #2 and forcing this unit into a premature retirement with an NSPS based on natural gas will be very costly to our ratepayers.
This rule only applies to new sources of base load and intermediate load electricity, and does not affect existing sources.  Thus, the commenter's concern that the rule jeopardizes its investment is misplaced.  In addition, the BSER is not based on natural gas use (the commenter appears confused with the 2012 proposed rule, now withdrawn).  EPA's projections show that the nation's electric generating mix will continue to be diverse, with coal accounting for a substantial share of generation well into the future (this finding is corroborated by EIA and many other independent forecasting groups).  Finally, EPA explored scenarios using alternative assumptions with considerably higher future electric demand and higher natural gas prices, and no scenario resulted in new conventional coal by 2020.  Independent analysis and projections from EIA confirm this trend. EPA does not project any change in energy prices as a result of this rule, and as such does not expect negative impacts on the affordability or reliability of electricity. See RIA Chapter 4.
Proposed rule will not impair reliability
Commenters (0775, 9406) state that the proposed rule will not impair reliability.
Commenter 0775 states the rule will not have a significant impact on the availability of electricity, as there are only five planned coal-fired power plants according to DOE's EIA-860 data, totaling less than 2.5 megawatts of nameplate capacity. Commenter says, two of these planned power plants are not yet under construction, and one that is listed as in testing has apparently been damaged to the point where the project's credit rating was downgraded to B+. Commenter says, it is doubtful that even these five units will all be built or operated.
Commenter 9406 states that suggestions that the Proposed Rule might impair the reliability of the electricity supply system are a red herring. Commenter says, some point to the need to call upon existing coal-fired power plants during the recent polar vortex as providing an example of the need for energy diversity in the generation supply, with the unstated and illogical implication that, therefore, the proposal for a CO2 emissions rate limit for new fossil fuel-fired boilers based upon partial carbon capture and sequestration ("PCCS") will impair reliability. Commenter says, the Proposed Rule relates to new generation facilities only, and existing coal-fired facilities were clearly sufficient to meet electricity demand even during the polar vortex in New England, where the Regional Greenhouse Gas Initiative already regulates GHG emissions from both new and existing power plants. Commenter agrees with EPA's judgment that under current economic conditions, no new coal-fired power plants will be built in the near future. Commenter says alleged concerns about reliability are simply fanciful.
Commenter 9406 states the new source standards should be designed to give the correct signals to guide investment in new infrastructure related to electric power. Commenter says, that infrastructure lasts for 40 years or more. Commenter says, meeting the objective of the United Nations Framework Convention on Climate Change to prevent dangerous anthropogenic interference with the climate system will require an 80% reduction of worldwide emissions by 2100 and far greater reductions if the United States is allocated its per capita share. Commenter says, new infrastructure must be planned and designed in light of this fact.
Commenter 9406 states there is currently significant excess generating capacity in existing NGCC plants that can be used without impairing reliability.  Commenter says, the development of shale oil and "wet" shale gas formations to develop oil supplies has created an oversupply of natural gas that has driven the prices of natural gas below the price necessary to support development of new dry gas wells. Commenter says, undeveloped shale gas resources can provide more than sufficient supplies of natural gas to meet the nation's interim energy needs, without new generating capacity with emissions rates far higher than what will be necessary to meet national and global climate change goals.
The EPA largely agrees with these comments, although the final standard of performance is not designed to meet an environmental goal or a priori level of reduction (per commenter 9406), but rather reflects a considered choice based on the statutory factors enumerated in section 111 (a).
Natural gas-fired generating units are essential to reliability
Commenter 9779 states, natural gas-fired generating units provide reasonably-priced, environmentally-friendly power that is essential to the reliable operation of the transmission grid and the integration of renewable resources. Commenter says, the outlook for low price gas has made natural gas turbine technology approximately forty percent cheaper to construct and operate than coal.
The EPA appreciates the information provided by the commenter which is consistent with the EPA's own analysis.
Measure promotion of energy diversity and independence
Commenter 10034 states, that the EPA's expected outcomes of the proposed rule include: (1) EPA asserts that this rulemaking reduces uncertainty, and will promote energy diversity. (79 FR 1496); and (2) EPA expects that the use of EOR from EGU captured carbon will lower production costs for domestic oil, which will promote energy independence. (79 FR 1480). Commenter says, the EPA should measure whether its rule does in fact help to promote the goals of energy diversity and energy independence.
These statements are presented in the preamble and strongly supported by analysis in the RIA, including analysis over a range of potential futures.
3.7.1 Proposed Rule Precludes Coal-Fired Generation
The proposed rule is part of an anti-coal agenda
Commenters (3236, 3593, 5631, 8742, 8971, 9194, 9396, 9650, 10046, 10951) characterize the proposed rule as an anti-coal agenda.
Commenters (3236, 8742) state, the proposed rule demonstrates that the administration seeks to end new coal-fired electrical generation through regulation. Commenters say, the EPA admits as much in the proposed standard by stating that the only fossil fuel plants that can meet the standard are natural gas plants. Commenter 8742 says, the presence of CO2 is not just in the U.S. but worldwide. Commenter 8742 says, imposing added energy costs on our own economy while other nations are not held to the same standard puts the U.S. at a competitive disadvantage. Commenter 8742 says, in the end, merely reducing fossil fuel emissions without producing a measurable impact on world temperatures or climate cannot be regarded as a success. Commenter 3236 says, the net effect of this "policy" seems essentially to eliminate the approval of any new coal-fired powered plants in the future. Commenter 3236 adds, while existing and modified EGUs are not included in this NSPS, this proposal is widely perceived as a pre-cursor to the standards that will ultimately be applied in the regulation of existing units. Commenter 3236 says, at a time when our country needs to consider all types of energy, the Proposed Standard appears to eliminate one of the most widely used and inexpensive sources of energy. Commenter 3236 says, any standard for utilities should be realistic and achievable for all sources of energy.
Commenter 3593 states, the EPA's stance on regulating power plant GHG emissions, as stated by EPA Administrator Gina McCarthy, is that under the new round of rulemaking including the current NSPS rule, coal will still be viable, a stance one would expect her to assert given that this must be the case under the law. Commenter says, likewise, Janet McCabe, then a senior aide in (and now the proposed nominee to lead) the Office of Air and Radiation, said in a hearing before the House Energy and Commerce Committee that, "We are not saying you can't build a new coal plant in America," and that there will be a "clear regulatory path" for new coal plants to be constructed. Commenter says, like efforts to rewrite the vow to "bankrupt" coal-fired power plants, this runs contrary to the proposed rule and is directly contrary to express assertions of the president and vice-president when campaigning for office (Joe Biden also stated, "No coal plants here in America," he said. "Build them, if they're going to build them, over there. Make them clean."
Commenter 3593 states, many in the industry as well as the instant rule's critics argue, however, that these regulations don't seek to make coal cleaner, but to "bankrupt" the industry altogether as then candidate Obama vowed. Commenter says, House Energy and Commerce Committee Chairman Fred Upton (RMI) characterizes the record as indicating that, "The EPA is holding the coal industry to requiring fuel-switching, impossibly characterizing a gas turbine as the best available emission reduction technology for a coal plant - impossible standards." Commenter says, indeed, this rule as originally proposed was pulled due to it obviously.