o The significant new investments that may be required by non-air environmental programs including EPA's recently proposed rule for disposal of coal combustion by products, EPA's revisions to cooling water intake rules, and its initiative to update its steam-electric effluent guidelines; and
o The potential investments required to meet new EPA greenhouse gas regulations and/or potential new federal climate change legislation.
o This cumulative cost exposure is raising significant concerns about the economic viability of a large number of existing coal-fired units, as well as potential impacts to grid reliability and imposition of substantial increases in retail electricity prices on consumers.
o No evaluation of these potential cumulative costs and impacts has been undertaken. Instead, EPA has engaged in only piecemeal examination of individual rules, and ignored the sustained economic pressures created by these increasingly stringent requirements. [EPA-HQ-OAR-2009-0491-2665.1, p.20]
The series of rulemakings aimed at the same electric generating units subject to the Proposed Transport Rule creates an unreasonable and unnecessary moving target that increases costs to electric consumers and threatens very large stranded or misplaced investments at a time of tight capital markets and the recent recession. [EPA-HQ-OAR-2009-0491-2665.1, p.26]
American Municipal Power, Inc. (AMP)
Additionally, EPA has ignored the other significant federal rule mandates that will add to the complexity of compliance. For instance, EPA has not factored in considerations associated with new NAAQS and entirely new permit concepts tied to greenhouse gas emissions. EPA should be more reasonable in developing workable timeframes and, as such, AMP requests that EPA reconsider this issue and suspend the compliance deadlines of the Transport Rule for at least five years. [EPA-HQ-OAR-2009-0491-2678.1, p.3]
American Public Power Association (APPA)
2. Fundamentally, APPA remains confused by the decisions made by the U.S. EPA on deadlines forced in this re-proposal of the original CAIR rule. APPA finds it difficult to not conclude that the combination of the Proposed Transport Rule (PTR) and the many other U.S. EPA final, proposed, and forthcoming air, water, and waste regulations will result in fuel switching to natural gas and premature coal plant closures in many of the 31 states impacted by the PTR. [EPA-HQ-OAR-2009-0491-2812.1, p.2]
Central Illinois Global Warming Solutions Group
[These comments were submitted as testimony at the Chicago, Illinois public hearing on August 19, 2010.  See Docket Number EPA-HQ-OAR-0491-1746, p.123.]
And I urge the EPA to stand strong and to adopt similar tough stances as other pollutants are regulated in the next cycle of looking everything over.
City of Springfield, Illinois, Office of Public Utilities
CWLP is also concerned that the proposed Transport Rule is both premature and potentially unnecessary. For example, it appears that USEPA has used 200S data as a starting point for its analysis, and has neither determined nor taken into account the impact on air quality as a result of recent actions to comply with the Clean Air Interstate Rule ('CAIR'). While USEPA's proposal to achieve maximum achievable control technology ('MACT') is not due until next spring and addresses pollutants not at issue here, the required MACT standard may require costly emission controls that could also reduce pollutants at issue in the Transport Rule. Similarly, guidance on greenhouse gases ('GHG') best available control technology ('BACT') is apparently now under review. Additionally, CWLP has agreed to lowered emission rates beginning in 2010 as part of a Best Available Retrofit Technology ('BART') agreement with Illinois EPA. By failing to recognize existing requirements and recent controls to comply with them, as well as impacts from the required MACT, GHG BACT standards and BART, US EPA's proposed Transport Rule lacks credibility, but wil also result in economic harm to the citizens of Springfield, without a correlative improvement to air quality. [EPA-HQ-OAR-2009-0491-2635.1, p.2]
Clean Air Task Force
Finally, we welcome EPA's stated intention to promulgate a number of rules in the future to require emission reductions from this sector beyond those in the Transport Rule proposal, including --
[These comments were also submitted as testimony at the Philadelphia, Pennsylvania public hearing on August 26, 2010.  See Docket Number EPA-HQ-OAR-2009-0491-1938, p.109.]
Section 112(d) 'MACT' standards, to be proposed by March 2011;
revisions to the new source performance standards (NSPS) for coal and oil-fired power plants (including performance standards for GHG emissions);
and best available retrofit technology (BART) and regional haze programs to protect visibility. [EPA-HQ-OAR-2009-0491-2738.1, p.5]
We urge EPA to follow through expeditiously with these important regulatory efforts, which we fully support. [EPA-HQ-OAR-2009-0491-2738.1, p.5]
Clean Energy Group
The Clean Energy Group Encourages EPA to Coordinate the Proposed Rulemaking with Other Regulations Affecting the Electric Sector
The Transport Rule is one of several rules affecting the electric sector that EPA will be implementing over the next five to ten years. Each of these rules will affect the industry and alter companies' long-term planning decisions. To enable companies to make decisions consistent with EPA's long-term vision, the Clean Energy Group continues to encourage EPA to coordinate the upcoming regulations to the extent EPA has the legal authority to do so and so long as coordination does not delay implementation. As discussed in our comments on EPA's draft Strategic Plan, we also support the coordination of regulations among EPA's air, water, and solid waste offices in order to allow EPA and industry to assess the interrelated impacts of all regulations affecting the electric sector.8 This will ensure maximum co-benefits while avoiding potential unintended consequences and without delaying important environmental, public health, and economic benefits. [EPA-HQ-OAR-2009-0491-2702.1, p. 12]
Cleco Corporation
EPA should continue to keep CAIR in place and coordinate the timing and requirements of the Transport Rule with other EGU rules such as the EGU MACT, which is currently anticipated to require reductions as early as 2015. In fact, EPA's EGU MACT rule, with unit-by-unit emission limits, could convert the Transport Rule and its trading program into a meaningless paper exercise. At a minimum, coordinating regulatory deadlines is necessary to facilitate compliance planning, maximize investments and minimize costs. Absent this coordination and proper time for industry to develop compliance strategies, EPA may dramatically increase the cost of electric power by forcing the industry to hastily adapt to ever changing regulations. [EPA-HQ-OAR-2009-0491-2859.1 p.3]
Consumers Energy
We note, with interest, that EPA has gone to the D.C. Circuit Court in order to obtain permission to extend the comment period for the proposed Industrial Boiler MACT rule. In a similar a spirit, we believe that EPA should also be committed to 'ensuring that the final standards will reflect all of the relevant information received during the public comment period' and extend the comment period for the proposed Transport Rule. As EPA has neither a Court mandated or statutory date for completion of this rule, an extension is entirely at EPA's discretion. [EPA-HQ-OAR-2009-0491-2837.1, p.4]
As proposed, the rule would significantly affect the planning, spending and operations of Consumers Energy, as well as those for all utilities within the Transport Rule region. Our company's planning includes capital expenses and scheduling built around the final and still enforceable CAIR to create and maintain a balanced energy portfolio. As proposed, EPA's Transport Rule would force acceleration of spending and construction schedules (if even possible) and, in all likelihood, increase costs for capital expenditures that Consumers Energy currently projects to total in excess of one billion dollars The likely cost increases, coupled with accelerated retirements of units throughout the proposed Transport Rule region, including Michigan, have also caught the attention of the Michigan Public Service Commission (MPSC) which serves to protect the ratepayers in Michigan. [EPA-HQ-OAR-2009-0491-3795.1_NODA, p.3]
Council of Industrial Boiler Owners (CIBO)
The practical impact on regulated sources of the multiple, aggressively timed rulemakings is nowhere considered by EPA. One simple example demonstrates the uncertainty and complexity of the multiple overlapping rulemaking proceedings. ICI sources now face (based on this Proposed Rule) an expectation that in 2012 NOx and SO2 standards will be tightened through alimited market trading program. Yet given the pending and likely litigation-bound definition of 'solid waste' for boilers under the § 112 MACT vs. § 129 CISWI regulations, those sources will not have the certainty to know what types of materials they may burn as 'boilers' in order to meet the future more stringent NOx and SO2 standards.[EPA-HQ-OAR-2009-0491-2751.1]
Proposed Rule carries no semblance of certainty or the orderly administration of regulation.
The proposal makes clear that sources gain no certainty from this rulemaking. EPA projects 2012 and 2014 projections are already outdated, as they do not account for emission reductions required under new pending or soon-to-be-issued regulations. EPA's analysis of costs for sources to comply with this Proposed Rule reflect an expectation that sources will install scrubbers, SCR or implement other similar emission control upgrades. EPA indicates that its analysis assumes only rules in place as of December 2008. Since December 2008, EPA has proposed, finalized or will propose and finalize these regulations that mandate some or all of the very same emission reduction strategies that will be required by this rule: SO2 NAAQS, NO2 NAAQS, Ozone NAAQS, Boiler MACT, CISWI, Utility MACT, PM NAAQS, CO NAAQS as well as a host of MACT and NSPS standards under the Risk and Technology Review provisions.
Industry needs to know what controls will be required in total so that plans and costs can be optimized. It is very hard for business to plan and budget for control needs without clarification of what reductions will ultimately be required. Open-ended piece meal regulations are inconsistent with meeting environmental objectives and planning funding and resources to accomplish those objectives in a reasonable manner. This Proposed Rule carries no semblance of certainty or the orderly administration of regulation.
These other intervening rules also affect EPA's assumptions in this Proposed Rule. For example, EPA's planned rulemakings on NOx and utility MACT will impose additional costs and impacts on EGUs. These rules could provide different circumstances for determining whether or not a plant continues to run. In some cases, the plants that were modeled to decrease output may be the plants that are in a better position to operate under these potential new rules, but will not be able to do so because of the allocations received under the Transport Rule. [EPA-HQ-OAR-2009-0491-2751.1 p. 4]
Dayton Power and Light Company (DP&L)
Additional Time Is Necessary For a Coordinated Approach to Overcoming Technological Challenges
DP&L is uncertain how it will meet the challenges posed by decreasing emission budgets in the proposed rule, given the number of other initiatives that are underway within the EPA and the fact that these proposed rules themselves are likely to be superseded in the near-future. EPA mentions in the proposal that it will issue a separate proposal regarding NOx emissions related to the 1997 ozone standard. EPA also has indicated it will issue a 'Clean Air Transport Rule II' related to a tightened (October 2010) ozone standard, and it is almost certain that EPA will propose an additional major transport rule in 2012 to address a more stringent late-2011 NAAQS for particulate matter. These rules are all in addition to the utility MACT rule, which will not be finalized until late-2011 (about 6 months after the Clean Air Transport Rule is finalized) and which is likely to greatly influence company decisions regarding future control equipment. [EPA-HQ-OAR-2009-0491-2637.1, p. 5]
Other regulations are identified as coming in the next few years and DP&L joins many other companies in expressing concerns about planning for the cascade of unknown requirements. [EPA-HQ-OAR-2009-0491-2637.1, p. 5]
The need for better coordination among these regulatory projects is another reason that DP&L recommends that the EPA follow the CAA and provide time for the States to develop their own SIP. DP&L also supports the comments made by Chris Korleski (Director of the Ohio Environmental Protection Agency) testifying before the Senate Environment & Public Works Committee on July 22, 2010, requesting that, 'any budget U.S. EPA promulgates for an emissions sector would not change for at least ten years and then only ifU. S. EPA demonstrates that additional controls are technically achievable and cost effective.' [EPA-HQ-OAR-2009-0491-2637.1, p. 5]
Detroit Regional Chamber
Considering the economic consequences of increased energy prices, we believe that environmental regulations should look to maximize the environmental and public health benefit from dollars spent on compliance and on Agency staff. Review of the environmental benefits of other recent rules packages may help target where specific improvements can be made without overly burdening state and federal regulators with administering parallel regulations while achieving the targets outlined in the proposed Transport Rule. In cases where compliance with current standards can already be demonstrated, it would be more efficient to consider the effect of new National Ambient Air Quality Standards before moving forward with this proposal. [EPA-HQ-OAR-2009-0491-2720.1, p.2]
Dominion
Harmonization of the S02 and NOx Reductions of the Transport Rule with Future/Expected Air, Climate, Water and Waste Regulations is Crucial to the Electric Utility Industry
In addition to these rules, EPA is in the process of preparing and/or implementing a number of air (including greenhouse gases), water, and waste regulations that will focus heavily on the electric power industry's fossil-fuel generating plants. These new EPA rules will address mercury and other hazardous air pollutants (HAPs), greenhouse gases (GHG), cooling water structures and waste water discharge, and ash disposal from coal-based power plants with a possible cumulative cost of tens of billions of dollars per year. All of these rules have the potential to require new emissions controls. [EPA-HQ-OAR-2009-0491-2715.1, p.16]
As a result of EPA's numerous proposed regulations impacting coal- and oil-fired stations, companies may choose to retire them or convert them to another fuel. In order to determine, for each unit, what the most appropriate control strategy should be, it is necessary to evaluate the long-term viability of each unit. Companies should not be required to decide whether to invest hundreds of millions of dollars in SCR's and scrubbers for a unit before understanding the other air, water and waste requirements the unit will be subject to. The electric sector needs clear, coordinated and flexible regulations that provide certainty for power companies to plan multi-billion dollar investments, many of which must serve decades into the future. Only through carefully crafted regulations that harmonize reduction timelines can the industry continue to minimize costs to customers and impacts on shareholders, while maintaining a reliable and diverse supply of energy resources. EPA should allow CAIR to remain in place and implement a new Transport Rule on a timetable more compatible with other expected regulatory measures. At a minimum, EPA should synchronize this rule with the Utility MACT rule, which will greatly influence company decisions regarding S02 control equipment, with reductions required no earlier than 2015. [EPA-HQ-OAR-2009-0491-2715.1, p.17]
Dynegy, Inc.
Third, EGUs will be subject to several other EPA (or state) emission reduction rules in the next three to five years, some of which will supersede emission reductions required by the Transport Rule and/or overlap (and potentially conflict with) the emission control strategies and technologies needed to comply with the Transport Rule. For example, this includes EPA rulemakings regarding the 24-hour PM2.5 NAAQS, a more stringent ozone NAAQS (e.g., the second Transport Rule already envisioned by EPA), the So, I-hour NAAQS, and EGU hazardous air pollutant standards. All these rules are expected to affect the same group of EGUs, the same air pollutants, and/or interrelated pollution control technologies. Rather than proceed in piecemeal regulatory fashion by creating another interim step for emissions control requirements that further complicates planning and promotes compliance inefficiencies, EPA should defer the effective date of the Transport Rule until at least 30 to 36 months after the rule is finalized and provide the opportunity for integrated emission reduction strategy planning and implementation. [EPA-HQ-OAR-2009-0491-2698.1, p.2]
Edison Electric Institute (EEI)
The Proposed Rule Must Not Be Considered in Isolation From Other EPA Regulations on Air (Including Greenhouse Gases), Water and Solid Waste
The new EPA rules likely to be in effect within the next two years will address:
Air quality issues, including greenhouse gases -- In addition to this Proposed Rule, ongoing EPA air quality rulemakings address new National Ambient Air Quality Standards (NAAQS) for ozone, particulate matter, SO2 and nitrogen dioxide (including additional transport rules related to the soon-to-be-revised ozone and particulate matter standards); visibility; mercury and other hazardous air pollutants (HAPs); and greenhouse gases (GHGs). These rules combined have a possible cumulative compliance cost of over $100 billion per year; EPA has estimated the compliance cost of a 0.060 parts per million ozone NAAQS alone at $52-90 billion in the year 2020. [EPA-HQ-OAR-2009-0491-2697.1, p.4]
Cooling water intake structures and waste water discharge -- EPA is revising its remanded cooling water intake structure rule for existing steam-electric power plants, and appears likely to propose a revised rule that will require many existing "once-through" plants to retrofit cooling towers. Widespread retrofitting of cooling towers would affect almost 500 nuclear and fossil units, with a total capital cost in excess of $67 billion if all companies are required to install cooling towers.  [EPA-HQ-OAR-2009-0491-2697.1, p.4]
Ash disposal from coal-based power plants -- EPA has issued a proposal that includes both hazardous and non-hazardous waste regulatory approaches for coal-combustion products (CCPs). Annual compliance costs for a hazardous waste regulation could exceed $20 billion and would have a devastating impact on CCP beneficial uses, such as drywall and construction materials. Annual compliance costs for a non-hazardous waste regulatory approach could be approximately $2 billion. New installations of flue gas desulfurization (FGD) equipment (SO2 scrubbers) associated with the Proposed Rule will need to address ash disposal, including permitting of new and modified disposal sites.  [EPA-HQ-OAR-2009-0491-2697.1, pp.4-5]
Regarding the proposed Transport Rule, some companies have major concerns while others support the proposal and believe the requirements can be met without difficulty. However, when considering the universe of all air quality, including GHGs, water quality and solid waste regulations, virtually all electric power companies have concerns. The impact of these regulations will vary regionally and from company to company. Some companies will be affected more by air quality regulations, while others will be most affected by water quality regulations, especially requirements for cooling towers under Clean Water Act § 316(b). Because there are many concurrent and near-future new requirements, the impact to the industry and to individual companies can only be assessed by looking at the complete set of regulations over the next decade or longer. [EPA-HQ-OAR-2009-0491-2697.1, p.5]
In order to continue to efficiently produce electricity and reduce emissions, the electric sector needs clear, coordinated and flexible regulations that provide adequate certainty for power companies to plan multi-billion dollar investments, many of which must serve decades into the future. Only through carefully crafted regulations can the industry continue to minimize costs to customers and impacts on shareholders, while maintaining a diverse supply of energy resources. [EPA-HQ-OAR-2009-0491-2697.1, p.5]
The Proposed Rule, Especially in Concert With Other Upcoming Regulations, Provides Little Certainty for the Industry to Plan its Future Activities
The proposed Transport Rule provides little long-term certainty because, by its very terms, its requirements will be superseded in the near future. EPA indicates in the proposal that it will issue a separate, additional transport proposal regarding NOx emissions related to the 1997 ozone standard. More importantly, EPA also has indicated it will propose in 2011 a "Transport Rule II" related to a tightened (October 2010) ozone standard, and it appears almost certain that EPA will propose an additional major Transport Rule in 2012 to address a more stringent late-2011 NAAQS for particulate matter. These rules are in addition to the power generator HAPs maximum achievable control technology (MACT) rule, which will not be finalized until late-2011 (about 6 months after the final Transport Rule) and which will greatly influence company decisions regarding SO2 control equipment. Many companies have expressed concerns about planning for a series of regulations with yet unknown requirements. [EPA-HQ-OAR-2009-0491-2697.1, pp. 5-6]
[This comment was also submitted as testimony at the Chicago, Illinois public hearing on August 19, 2010.  See Docket Number EPA-HQ-OAR-0491-1746, pp.27-28.]
Describing this situation for Ohio companies, testifying before the Senate Environment & Public Works Committee on July 22, 2010, Chris Korleski (Director of the Ohio Environmental Protection Agency) stated
Next, we are concerned with the concept that each time U.S. EPA promulgates a new (more restrictive) air quality standard, U.S. EPA intends to revise the Interstate Transport Rule by changing the emission budgets. We have two main concerns with this approach. First, we expect that at some point, it will be difficult or impossible to develop and implement technology that can achieve the new, more restrictive budgets. Second, the regulated community must have some degree of certainty to timely plan investments in controls, fuels, and operations at generating facilities in order to achieve necessary emission levels by the relevant deadline. [EPA-HQ-OAR-2009-0491-2697.1, p.6]
[These comments were submitted as testimony at the Chicago, Illinois public hearing on August 19, 2010.  See Docket Number EPA-HQ-OAR-0491-1746, p.27.]
EEI has misgivings regarding the proposed Transport Rule providing little long term certainty because its requirements will be superceded in the very near future.
EPA mentions in the proposal that it is likely to alter this proposal to address wintertime emissions related to attaining the 24 hour PM2.5 standard.
[These comments were submitted as testimony at the Atlanta, Georgia public hearing on September 1, 2010.  See Docket Number EPA-HQ-OAR-0491-1939, pp.54-55.  These comments were also submitted as testimony at the Philadelphia, Pennsylvania public hearing on August 26, 2010.  See Docket Number EPA-HQ-OAR-2009-0491-1938, p.103.]
These rules are all in addition to the power generating sector MACT rule, which will not be finalized until late 2011, about six months after the final Transport Rule, and which will greatly influence company decisions regarding sulfer dioxide equipment.
These rules will force unknown additional control requirements for Georgia power plants in addition to in-state requirements related to ozone, particulate matter, sulfer dioxide and nitrogen oxide, National Ambient Air Quality Standards, and regional haze. In order for us to continue to effectively produce electricity and reduce emissions, the electric sector needs clear, coordinated and flexible regulations that provide certainty for power companies to plan multi-billion-dollar investments, many of which must serve decades into the future.
[These comments were submitted as testimony at the Philadelphia, Pennsylvania public hearing on August 26, 2010.  See Docket Number EPA-HQ-OAR-2009-0491-1938, p.103.]
In order to continue to effectively produce electricity and reduce emissions, the electric sector needs clear, coordinated and flexible regulations that provide certainty for power companies to plan multi-billion dollar investments, many of which must serve decades into the future.
Only through carefully crafted regulations can EEI members continue to minimize costs to customers and impacts on shareholders, avoid straining natural gas supply and prices, and continue efficient and reliable electric generation using diverse, domestic energy resources.
Exelon
THE TRANSPORT RULE IS ONE OF A NUMBER OF MAJOR EPA RULEMAKINGS EXPECTED TO AFFECT FOSSIL FUEL EGUS IN THE NEAR FUTURE. TO THE EXTENT POSSIBLE, EPA SHOULD COORDINATE THE REQUIREMENTS AND IMPLEMENTATION SCHEDULES OF THESE RULEMAKINGS WITH OTHER GOVERNMENT AGENCIES WITHOUT DELAYING NEEDED ENVIRONMENTAL BENEFITS.
The Transport Rule is one of a number of rulemakings under way at EPA that will affect fossil fuel EGUs. EPA has adopted or plans to propose revisions to the NAAQS for NOX, Ozone and PM2.5. EPA is obliged to promulgate a NESHAP prescribing Maximum Achievable Control Technology ('MACT') for hazardous air pollutant emissions from EGUs in 2011. EPA has a number of rulemakings and guidance documents under preparation that address greenhouse gas emissions ('GHGs'). While EPA must consider these upcoming rulemakings, it is important to maintain issue separation. For example, some fossil fuel EGU owners may attempt in their comments to conflate the impact of the Transport Rule with the retirements that may occur as a result of the anticipated EGU MACT rule. EPA should disregard such comments, except to the extent that they relate appropriately to the regulatory scheme established in the Transport Rule. [EPA-HQ-OAR-2009-0491-2666.1, p.6]
Some energy companies have characterized the congruence of the Transport Rule and other pending EPA rules as a 'train wreck,' conjuring the three-headed specter of shuttered plants, skyrocketing electricity prices and potential blackouts. Such rhetoric is a transparent scare tactic. The Transport Rule will not result in the closure of fossil fuel EGUs. As long as the Transport Rule and EPA's other regulatory initiatives are properly managed, these efforts will clear the tracks for a clean and more reliable energy future by providing the market signals and incentives for companies such as Exelon to invest capital in clean and reliable renewable and nuclear generation technologies, technology to control emissions from natural gas generation, and technologies to promote energy efficiency and conservation. While these rules collectively may result in closure of some energy generation dinosaurs - these older cold-fired plants are the least efficient and most polluting. They are also the plants that Congress believed would have been phased out long ago when it enacted the CAA in 1970. [EPA-HQ-OAR-2009-0491-2666.1, pp.6-7]
Although some areas may see increases in generation costs, these rules will likely increase equity. Those whose costs may increase are located in areas of the country that have historically enjoyed lower electricity costs while the pollution and health impacts from that low cost electricity have fallen on downwind areas further burdened by higher electricity costs. As evidenced by Dr. Cicchetti's report, these rules will alleviate disincentives to investment in our nation's downwind urban centers and promote environmental justice by lightening the pollution burden imposed on disadvantaged urban populations. 10 [EPA-HQ-OAR-2009-0491-2666.1, p.7]
Exelon believes that, with adequate attention to coordination, EPA will be able to implement all of its forthcoming programs necessary to promote human health and the environment, without causing unnecessary dislocation in the electricity market. The CAA provides adequate flexibility both with respect to implementation deadlines and the availability of compliance extensions where certain conditions are met. The statutory risk management procedures available to EPA, the Department of Energy ('DOE') and the Federal Energy Regulatory Commission ('FERC'), as well as safeguards in the electricity markets, will assure that electric reliability is preserved throughout the implementation of all of the forthcoming regulatory actions. Nonetheless, EPA could ease the transition to a modernized, cleaner energy fleet by providing clear and early indications of emissions reductions that will be required by future rulemakings and revisions to NAAQS. Exelon proposes below several modifications to the Transport Rule that will allow fossil fuel owners to anticipate reductions in allowance allocations that might be necessary to implement future NAAQS revisions. EPA should attempt to incorporate similar transparency in other rulemakings. [EPA-HQ-OAR-2009-0491-2666.1, p.7]

10 Environmental justice is one of the EPA's highest priorities and one of the seven guiding principles in EPA's strategic plan. See Memorandum from Stephen L. Johnson, EPA Administrator, Reaffirming the U.S. Environmental Protection Agency's Commitment to Environmental Justice (Nov. 4, 2005).
First Energy
FE strongly suggests EPA follow through with coordination of the development and public comment and review of CATR and EGU MACT, at a minimum. [EPA-HQ-OAR-2009-0491-2657.1, p2]
EPA's own comments in the rulemaking at page 45227, Section E "Anticipated Rules Affecting the Power Sector," suggest that the Agency recognizes the need for this certainty and intends to coordinate the various rulemakings "with the goal of fostering investments in the most efficient and forward-looking expenditure of investor, shareholder and public funds...". It serves no ones interest to invest millions to comply with CATR and then strand that expenditure if the facility is retired due to the next EPA rulemaking. [EPA-HQ-OAR-2009-0491-2657.1, p.2]
Further, given the additional rulemakings pending on the EPA's calendar (EGU MACT, Coal Combustion Residuals, CWA Section 316, and others), EPA should coordinate the various timelines to allow the regulated community to make sound strategic decisions relative to EPA's regulatory programs. In particular, EGU MACT rules will also impose air emission reductions on the same subset of sources and are expected to be proposed in the second quarter of 2011 and require reductions of the same pollutants, in the same timeframe as CATR. [EPA-HQ-OAR-2009-0491-2657.1, p.2; these comments can also be found at EPA-HQ-OAR-2009-0491-3772.1_NODA, p.2 10/15/2010]
Florida Electric Power Coordinating Group, Inc. (FCG)
EPA has provided a cursory assessment and explanation of the impacts of its proposed Transport Rule on the utility sector. But EPA has not attempted to analyze the combined impact of this proposal with other rules it has either recently promulgated, or is actively developing. Each of these rules individually will have a significant impact on the cost of electricity generation and transmission; combined, EPA's initiatives could have a crippling and irreparable impact. [EPA-HQ-OAR-2009-0491-2658.1, p.4]
Florida Municipal Electric Association (FMEA)
EPA Must Assess the Economic and Reliability Impact on Electric Utilities and its Customers of all Recently-Promulgated and Pending Regulations  A few key regulatory examples that EPA must incorporate into its economic and reliability analysis include the: (a) 2010 National Ambient Air Quality Standard for NO2; (b) 2010 National Ambient Air Quality Standard for SO2; (c) 2010 National Ambient Air Quality Standard for ozone; (d) 2011 National Ambient Air Quality Standard for PM2.5; (e) 2011 National Ambient Air Quality Standard CO; (f) 2011 revisions to the Transport Rule; (g) Regional haze rule; (h) Greenhouse gas regulations; (i) 2011 industrial boiler MACT; (j) 2011 utility MACT; (k) 2010 revisions to 40 CFR 63, Subpart ZZZZ (l) 316(b) cooling water intake structures; (m) Numeric nutrient criteria; and (n) Coal combustion residuals. [EPA-HQ-OAR-2009-0491-2731.1, pp. 6-7]
Any credible economic and reliability assessment must include the combined impact of all of these rules; to do otherwise would be negligent, an abuse of discretion, and arbitrary and capricious. EPA attempted to analyze the cost of its proposal, but has thus far kept blinders on when considering whether other regulations could be relevant to its overall impact assessment. As an example of a more holistic assessment, the North American Electric Reliability Corporation (NERC) is currently evaluating the combined impact of four of the above EPA rules on the retirement of specific electric generating units, planning reserve margins, and the need for additional generating units, as well as the magnitude of construction planning necessary for timely compliance. The specific rules NERC is evaluating are the Transport Rule, the utility MACT, 316(b) intake structures, and coal combustion residuals. Further, Electric utilities in Florida are required (annually) to plan on a 10-year horizon, and whenever they decide to make a prudent capital expenditure, it is made with a 20-30-40+ year vision considering all relevant and foreseeable regulatory initiatives. EPA must also consider the long-term consequences of its rules.[EPA-HQ-OAR-2009-0491-2731.1, p. 7]
Accordingly, EPA must conduct a holistic analysis of the impact of all of its regulatory initiatives. [EPA-HQ-OAR-2009-0491-2731.1, p. 7]
Hoosier Rural Electric Cooperative
It appears that CATR does not take into account the countless other EPA proposed rules and the affect that it has on affected companies. For example most utilities will be affected by the proposed EGD MACT rule, NOz and SOz NAAQS, Greenhouse Gas tailoring rule, Coal Combustion Residuals, and etc. [EPA-HQ-OAR-2009-0491-2724.1 p.2]
Indiana Energy Association
d. The Indiana Utility Group submits that there is no accommodation in the proposed CATR for the impact of the myriad of other new EPA proposed rules on the physical control installation process. The fact is that all of these new rules (e.g., proposed EGU MACT rule, GHG Tailoring rule, NO2 NAAQS, SO2 NAAQS, coal ash rule, and Clean Water Act 316) are related based on consumption of resources, overlapping planning and compliance periods and the modeling necessary to comply. The EPA analysis of the CATR in isolation will result in a significant administrative burden on companies having to spend resources to, prepare PSD permits and perform dispersion modeling, among other administrative requirements, concurrently with CATR compliance management. The Indiana Utility Group therefore urges EPA to reassess the CATR in conjunction with the myriad of new EPA rules affecting EGUs and consuming administrative resources. Failure to reassess the CATR in conjunction with the other new proposed rules results in an unrealistic Regulatory Impact Analysis that simply does not support the CATR as proposed. [EPA-HQ-OAR-2009-0491-3711 p.3]
Indiana Municipal Power Agency
The EPA has not determined the effect that recent actions to comply with the Clean Air Interstate Rule (CAIR) will have on ambient and downwind air quality. Because of actions already taken, the Transport Rule may not be necessary. [EPA-HQ-OAR-2009-0491-3057.1,p.1]
Before the EPA imposes new reductions on sulfur dioxide and nitrogen oxide emissions, it should take into account the progress that the nation has made under CAIR. Though the Rule was remanded by the D.C. Circuit Court of Appeals in 2008, it remains in effect and generation companies have necessarily moved ahead with implementation of compliance measures. Before new rules are imposed on a still-weak economy, it makes more sense to determine what improvements in air quality have already occurred. To ignore the improvement the nation has made to date could impose needless substantial costs on our members and region with limited incremental environmental benefit. As we continue to climb out of recession, the last thing that government should do is create additional costs to the economy without substantiated reasons. [EPA-HQ-OAR-2009-0491-3057.1,p.2]
We applaud the EPA's efforts to improve air quality for all Americans and to address downwind issues. However, we believe the EPA's actions are premature and do not allow enough time for state participation or flexibility for industry compliance. Hasty action will have economic consequences for our members without any assurance that the rule will deliver the desired results any faster than the nation can achieve on its current path. We urge the EPA to delay the Transport Rule until there is a clear indication that comparable results cannot be achieved through CAlR. The EPA also should establish realistic deadlines that will not punish electricity consumers. [EPA-HQ-OAR-2009-0491-3057.1,p.3]
Luminant
VI. EPA's Numerous, Concurrent Rulemakings Do Not Provide for Regulatory Certainty and Reasonable Implementation Planning.
EPA has recently proposed, promulgated, or is developing, rules that impact EGUs for the same pollutants that CATR covers. The one-hour SO2 National Ambient Air Quality Standard, the impending re-proposal of the 8-hour ozone NAAQS, the upcoming PM2.5 NAAQS and the 'Transport II' Rule, to name a few, may all have significant impacts on EGUs that would affect the targets and timelines for reduction of these emissions. [EPA-HQ-OAR-2009-0491-2729.1, p.7]
In addition, EPA is also developing Maximum Achievable Control Technology rules for hazardous air pollutants that could also have a significant impact on these emissions. It is imperative for the reliability of the electric system and the health of the US economy that the basis and structure behind this rulemaking be sound and result in realistic outcomes. [EPA-HQ-OAR-2009-0491-2729.1, p.7]
Maryland Department of Environment (MDE)
Larger, additional regional reductions of NOx will be needed for Maryland to attain the new ozone standard. We urge EPA to move ahead quickly with aggressive national rules for boilers, cement kilns, mobile sources, marine engines, locomotives and next round of EGU controls. These 6 source sectors represent about 75% of the NOx that is left to regulate. [EPA-HQ-OAR-2009-0491-2639.1, p.3]
We do recognize that EPA will need to use a suite of different authorities under the Clean Air Act, including Section 110, Section 112, NSR, NSPS and Title II and that the final state-of-the-art, multi-pollutant control program may be implemented in several steps using those different authorities. Transport Rule 1, followed quickly by Transport Rule 2, will be critical steps in this process. We urge EPA to move ahead aggressively to achieve this goal. [EPA-HQ-OAR-2009-0491-2639.2, p.1]
MDE supports the framework for quick updates to the Transport Rule. In the proposal, EPA recognizes the need for the Transport Rule to quickly adapt to the future revisions of the NAAQS for ozone and PM2.5. The proposal emphasizes the methodology for identifying and quantifying the section 110(a)(2)(D) "significant contributions," so that new standards can be issued concurrently with updates to the Transport Rule. While EPA elected to base this first Transport Rule on 1997 8-hour ozone and annual PM2.5 standards, and the 2006 24-hour PM2.5 standard, the modeling of state contributions to all monitor sites in the 37-state region puts all states on notice that lower standards will entail more encompassing and rigorous air pollution regulations. [EPA-HQ-OAR-2009-0491-2639.2, p.2]
MeadWestvaco Corporation (MWV)
MWV would also like to take the opportunity to point out that within this proposal and future proposals EPA should fully consider emission reductions that will be achieved over the next few years related to Boiler MACT and other regulatory programs. These standards will result in significant reductions of both PM and 802, which will result in improvements in air quality within non-attainment areas. [EPA-HQ-OAR-2009-0491-2650.1, p. 2]
Midamerican Energy Holdings Company
As EPA published data demonstrates, the electric power sector has made significant progress in reducing emissions of SO2 and NOx. Nationally, SO2 emissions from power plants were 67% lower in 2009 than in 1980 and NOx emissions were 72% lower during the same period. These emission reduction efforts took place over a number of years, through well-developed laws and regulations that achieved real emission reductions while allowing companies to plan for compliance with these requirements in a way that ensured that electricity consumers did not experience sudden, significant increases in electricity costs. One of the reasons that electricity consumers did not experience significant increases in costs of electricity associated with the installation of emission controls was that the requirements were implemented in a way that also provided assurance to utilities that they could appropriately depreciate the significant investment in emission controls over a 20-plus year equipment and plant life. [EPA-HQ-OAR-2009-0491-2748.1 p.1]
This environmental and economic regulatory paradigm has changed dramatically, and given the multitude of air quality issues1 facing utility companies in the near term, including, but not limited to, revised SO2, particulate matter, ozone and nitrogen dioxide National Ambient Air Quality Standards, the upcoming mercury and other hazardous air pollutant (HAPs) MACT, regional haze, and regulation of greenhouse gases, companies are being forced to make significant decisions on major capital investments in existing facilities that may ultimately not be fully utilized or fully depreciated. The EPA has made it clear that this is only the first step in reducing transport emissions and contemplates another potential emissions reduction as a result of the revised ozone standard even before the Transport Rule is finalized. [EPA-HQ-OAR-2009-0491-2748.1 p.1]
Utilities face at least three statutory requirements that must be reconciled; (1) state and federal requirements to maintain a reliable electric system capable of providing electric service in whatever amount customers demand; (2) state requirements to offer electric service at reasonable or least cost rates; and (3) federal and state environmental requirements, including restrictions on emissions. Reconciling these requirements is difficult under any conditions and is even more difficult given the likely adoption of various federal and state environmental requirements to reduce greenhouse gas emissions where the timing, amount and structure of the requirements cannot reliably be forecast. [EPA-HQ-OAR-2009-0491-2748.1 p.2]
It is difficult, if not impossible, for utilities to make sound, well-informed decisions that are in the best interests of their customers, the public and the environment to install expensive, long-life equipment while aiming at moving, short-term targets, particularly when the statutory requirements to be met by a utility may be in conflict. MidAmerican questions how a utility can make decisions that are in the best interests of its customers and the public, while, at the same time, ensuring reliable electric to meet customers' demand at reasonable or least cost rates if, in order to comply with the first phase of the Transport Rule in 2012, it balances the 50% greater water consumption aspects requirements of a wet scrubber with a 95% removal efficiency that will generate wet slurry that cannot be disposed of in a surface impoundment with the advantages of a dry scrubber having a 90% removal efficiency? And, to further complicate the balance, how can a company make a good decision on its Transport Rule compliance when EPA proposes the HAPs MACT in March 2011, finalizes the MACT in November 2011, and ultimately dictates a scrubber with a 98% removal efficiency to achieve the requisite acid gas removal criteria, with a compliance date in 2014? How can the utility, at the same time, ensure that it has a reliable supply of electricity that meets its statutory requirement of providing that electricity at reasonable or least cost rates when it is left in the untenable situation of having made a stranded investment in whatever control it chooses when it cannot meet the HAPs MACT or has to shut down to comply with greenhouse gas reduction requirements? [EPA-HQ-OAR-2009-0491-2748.1 p.2]
The Reopener Provision Fails to Provide Needed Certainty
While MidAmerican recognizes EPA's need to attempt to address interstate transport of emissions as they impact a state's ability to meet the NAAQS, due to the timing issues associated with the compliance dates specified in the Transport Rule and the revised NAAQS, facilities are put in a difficult position regarding installation of controls. Anticipating the next round of emission reductions, facilities can choose to install control equipment that will achieve the maximum possible emission reductions  -  at a higher cost  -  as a hedge that whatever those controls are will hopefully be sufficient to meet the next round of required reductions (effectively resulting in a false choice). However, installing the "gold-plated" version of controls may not be acceptable from a utility regulatory commission's perspective because compliance is not achieved through a least-cost program. Likewise, there is no guarantee that those controls will be sufficient to meet the yet-to-be-proposed HAPs MACT in the latter part of 2014 or other more stringent future requirements. MidAmerican believes that a better, more reasonable approach to regulating emissions reductions is that once a facility is retrofitted with state-of-the-art emission controls for a covered pollutant it will not be subject to further emission reduction requirements for that pollutant for the life of the unit while such emission controls are in place.  [EPA-HQ-OAR-2009-0491-2748.1, p.6]
Response:
EPA's approach in the Transport Rule to measure and address each state's significant contribution to downwind nonattainment and interference with maintenance is guided by and consistent with the Court's opinion in North Carolina and addresses the flaws in CAIR identified by the Court therein.  The final rule also responds to extensive public comments and stakeholder input received during the public comment periods in response to the proposal and subsequent Notices of Data Availability (NODAs), and will provide greater certainty to affected sources and states.  The extensive analyses of this final rule indicate that there will be modest impacts on electricity prices, utilities, and consumers.
As discussed in section III of the Preamble to this rule, EPA will provide full opportunity for notice and comment on each rule as they are proposed and finalized.  EPA will also include the final Transport Rule in its regulatory impact analyses of subsequent rulemakings.
EPA will coordinate utility-related air pollution rules with each other and with other actions affecting the power sector including these rules from EPA's Office of Water and its Office of Resource Conservation and Recovery to the extent consistent with legal authority in order to provide timely information needed to support regulated sources in making informed decisions.  Use of a small number of air pollution control technologies, widely deployed, can assist with compliance for multiple rules.  EPA also notes that the flexibility inherent in the allowance-trading mechanism included in the Transport Rule affords utilities themselves a degree of latitude to determine how best to integrate compliance with the emissions reduction requirements of this rule and those of the other rules.  EPA will pursue energy efficiency improvements in the use of electricity throughout the economy, along with other federal agencies, states and other groups, which will contribute to additional environmental and public health improvements while lowering the costs of realizing those improvements.
The approach embodied within the rule is partly designed to improve the planning process for the NAAQS, is readily applicable to any current and future NAAQS, and would automatically adjust the stringency of the transport threshold to maintain a constant relationship with the stringency of the relevant NAAQS as they are revised.  EPA believes that the final Transport Rule demonstrates the value of this approach for addressing the role of interstate transport of air pollution in communities' ability to comply with current and future NAAQS.  EPA believes that the Transport Rule's approach of using air-quality thresholds to determine upwind-to-downwind-state linkages and using the cost- and air quality-based multi-factor approach to quantify significant contribution to nonattainment and interference with maintenance (i.e., to determine the specific amount of emissions that each upwind state must reduce) could serve as a precedent for quantifying upwind state emission reduction responsibilities with respect to potential future NAAQS.
With respect to the 1997 ozone NAAQS, the Transport Rule requires NOx reductions starting in 2012 to ensure that reductions are made as expeditiously as practicable to assist downwind state attainment and maintenance of the standard.  Sources must comply by May 1, 2012.  The Transport Rule's compliance schedule and alignment with downwind NAAQS attainment deadlines are discussed in detail in section VII of the preamble.
Organization: Associated Electric Cooperative, Inc. (AECI)
Comment:
Associated Electric Cooperative, Inc. (AECI)
Request: AECI requests that EPA adjust the implementation of the Transport Rule to begin later while keeping CAIR in place in the interim. Since CAIR would remain in effect in the intervening year(s), the environmental consequences of allowing the Transport Rule to begin later would be nearly inconsequential. Further, granting this request would accomplish the following:
:: Allow the states and regulated community to digest new NAAQS that will inform decisions on planning and permitting for existing and new facilities;
:: Allow the proposal, comment, and finalization of the EGU MACT to take place in 2011 and provide utilities time to digest the impact to their generating system. As stated above,  compliance with the MACT will greatly impact how utilities plan for adding emission controls or unit retirements. Unit retirements will impact system reliability and will reduce options for utilities to comply with FERC capacity and transmission requirements;
:: Allow states time to develop approvable State Implementation Plans (SIPs) that include unit allocations that better fit the regulated community. The states already have mechanisms developed under the CAIR SIP development for distributing their state budgets to facilities within their borders; [EPA-HQ-OAR-2009-0491-2845.1 p.3] [[This comment is also found in Section VII.C.]]
Certain states were planning to demonstrate compliance with Regional Haze rules by citing emission reductions obtained through the CAIR.
Request: AECI requests that EPA amend the rule to codify the emission reductions of the Transport Rule as equivalent to, or better than, Best Available Retrofit Technology (BART) for meeting Regional Haze requirements. [EPA-HQ-OAR-2009-0491-2845.1 p.8-9]
Response:
EPA is taking no final action in this rule with respect to the relationship between the Transport Rule requirements and the visibility provisions of the CAA including the BART requirement.
EPA strongly disagrees with commenter's' suggestions that the Transport Rule deadlines should be delayed.  Please see section VII.C.1 of the preamble for discussion of why EPA selected 2012 and 2014 as important compliance deadlines for the Transport Rule programs.  EPA's analysis in this final rule shows substantial benefits from implementing this rule by the 2012 and 2014 deadlines, which represent the costs to public health and welfare that Americans would incur without successful implementation of this rule; the cost of delay is therefore of considerable consequence to the public.  EPA cannot rely on keeping CAIR in place in the interim, since the Court specifically found these programs to be illegal and only allowed them to remain in place on the basis that EPA would act as quickly as possible to replace them with programs consistent with its statutory authority under the Clean Air Act.  EPA believes it would be inappropriate to risk vacatur of these programs while delaying the promulgation of a replacement rule.
EPA appreciates that many EGUs will have compliance obligations under both the Transport Rule and the Mercury and Air Toxics Standards (MATS), and EPA included a representation of the proposed Transport Rule in its modeling projections of compliance behavior under the proposed MATS [EPA - HQ - OAR - 2011 - 0044].  EPA believes this analysis shows that compliance decisions are highly compatible under both programs, and EPA finds no reason to doubt that EGU owners and operators will be able to make sound investment and operational decisions on the basis of compliance with this final Transport Rule and the finalization of MATS later this year.  In fact, EPA believes that finalization of the Transport Rule today greatly increases regulatory certainty in the power sector and provides an additional "known" which will allow for better compliance planning in regard to other pending regulations the Agency has proposed.
Finally, EPA has created rapid and flexible pathways for states to assume allocation responsibilities under the Transport Rule programs.  Please see section X of the preamble for more details.
Organization: Edison Mission Energy (EME)
Comment:
Edison Mission Energy (EME)
EPA failed to indicate, as it had with respect to CAIR, that compliance with the Transport Rule would be sufficient to satisfy regional haze requirements. Given the magnitude of the reductions contemplated by the Transport Rule, EME was surprised that its preamble did not include a determination by EPA that compliance with the Rule satisfied Regional Haze Rule requirements. Based on the magnitude of the reductions contemplated by the Transport Rule, EME submits that EPA should make such a determination in the final rule. [EPA-HQ-OAR-2009-0491-2707.1, p.3]
EPA's Aggressive Timeline And Other Recently Promulgated Rules Increase The Probability That Shortages Of Materials And Labor Due To Increased Demand For Control Equipment Installation At Power Plants Will Make Compliance With The 2014 Cap Impracticable [EPA-HQ-OAR-2009-0491-2707.1, p.26]
Related to the emission control maintenance and installation timeframe issues discussed above, EME submits that the Agency should consider, when finalizing the Phase II cap deadline, the impact of the Transport Rule and other pending rules (including Boiler MACT and Utility MACT) with similar compliance dates on the availability of the raw materials, skilled labor and construction equipment needed to install the FGD, SCRs and SNCRs contemplated by the rule. Unlike other forms of construction where skill sets can be transferred across construction disciplines, adding emission controls to EGU and non-EGU boilers is a highly specialized endeavor requiring experienced engineers and craftsman; thus, having competing rules which require related types emission controls means that the entities that install those controls will necessarily face increased demand. [EPA-HQ-OAR-2009-0491-2707.1, p.26]
[See [EPA-HQ-OAR-2009-0491-2707.1, p.26-27 for additional comments pertaining to EPA's Aggressive Timeline And Other Recently Promulgated Rules Increase The Probability That Shortages Of Materials And Labor Due To Increased Demand For Control Equipment Installation At Power Plants Will Make Compliance With The 2014 Cap Impracticable]
The preceding suggests that EPA should endeavor to harmonize the Transport Rule's compliance deadlines with those created by other rules, such as the anticipated Utility MACT. The compliance deadline modifications in Section III.B.4 below, in addition to correcting the technical feasibility problems with EPA's currently proposed deadlines, achieve such a harmonization. [EPA-HQ-OAR-2009-0491-2707.1, p.27]
EME BELIEVES THAT COMPLIANCE WITH ANY TRANSPORT RULE THAT IS ULTIMATELY ADOPTED SHOULD BE SUFFICIENT TO SATISFY REGIONAL HAZE REQUIREMENTS [EPA-HQ-OAR-2009-0491-2707.1, pp.37]
Notably absent from the Agency's Transport Rule is any substantive discussion of its relationship to the Regional Haze Rule (CAA § 169A) and related Best Available Retrofit Technology requirement, unlike the CAIR proposal which expressly sought out comment on the relationship between these rules. EME had previously supported the Agency's determination that compliance by affected EGUs with the relevant CAIR standards would satisfy the Regional Haze Rule and BART requirements of the CAA. EME submits that EPA should adopt the same approach with respect to the Transport Rule given the magnitude of the NOx and SO2 emissions reductions contemplated by the Rule's Phase II cap and their relationship to the reductions EPA has predicted will be necessary to achieve Regional Haze goals. As such, EPA should recognize an EGU's compliance with the Transport Rule as satisfying Regional Haze emissions requirements through the first implementation period (which ends in 2018) as it did under CAIR, and it should further recognize that compliance with the Rule also satisfies emissions requirements through the second implementation period as well. [EPA-HQ-OAR-2009-0491-2707.1, p.37; for additional comments pertaining to EME Believes That Compliance With Any Transport Rule That is Ultimately Adopted Should be Sufficient to Satisfy Regional Haze Requirements see pp.37-42 of this comment summary]
Based on the foregoing, EME submits that states subject to the Transport Rule will achieve, and likely comfortably exceed, the Regional Haze Rule's reasonable progress requirements. Accordingly, EPA should formally determine in the final Transport Rule that states and EGUs in compliance with the Rule will have also satisfied all Regional Haze requirements, including BART and emissions standards, through 2018 and beyond. At a minimum, EPA should establish a strong presumption that affected states are in compliance with "reasonable progress" requirements and that compliance with the Transport Rule satisfies BART requirements and emissions limitations with respect to EGUs for which they are required. The basis for either of these positions is EPA's own modeling which shows that the emissions reductions predicted to result from that Proposed Rule in combination with regulations in force or pending are likely overwhelmingly sufficient for achievement of the Regional Haze Rule's objectives. [EPA-HQ-OAR-2009-0491-2707.1, pp.41-42]
Response:
EPA's approach in the Transport Rule to measure and address each state's significant contribution to downwind nonattainment and interference with maintenance is guided by and consistent with the Court's opinion in North Carolina and addresses the flaws in CAIR identified by the Court therein.  The final rule also responds to extensive public comments and stakeholder input received during the public comment periods in response to the proposal and subsequent Notices of Data Availability (NODAs), and will provide greater certainty to affected sources and states.  The extensive analyses of this final rule indicate that there will be modest impacts on electricity prices, utilities, and consumers.
As discussed in section III of the Preamble to this rule, EPA will provide full opportunity for notice and comment on each rule as they are proposed and finalized.  EPA will also include the final Transport Rule in its regulatory impact analyses of subsequent rulemakings.
EPA will coordinate utility-related air pollution rules with each other and with other actions affecting the power sector including these rules from EPA's Office of Water and its Office of Resource Conservation and Recovery to the extent consistent with legal authority in order to provide timely information needed to support regulated sources in making informed decisions.  Use of a small number of air pollution control technologies, widely deployed, can assist with compliance for multiple rules.  EPA also notes that the flexibility inherent in the allowance-trading mechanism included in the Transport Rule affords utilities themselves a degree of latitude to determine how best to integrate compliance with the emissions reduction requirements of this rule and those of the other rules.  EPA will pursue energy efficiency improvements in the use of electricity throughout the economy, along with other federal agencies, states and other groups, which will contribute to additional environmental and public health improvements while lowering the costs of realizing those improvements.
The approach embodied within the rule is partly designed to improve the planning process for the NAAQS, is readily applicable to any current and future NAAQS, and would automatically adjust the stringency of the transport threshold to maintain a constant relationship with the stringency of the relevant NAAQS as they are revised.  EPA believes that the final Transport Rule demonstrates the value of this approach for addressing the role of interstate transport of air pollution in communities' ability to comply with current and future NAAQS.  EPA believes that the Transport Rule's approach of using air-quality thresholds to determine upwind-to-downwind-state linkages and using the cost- and air quality-based multi-factor approach to quantify significant contribution to nonattainment and interference with maintenance (i.e., to determine the specific amount of emissions that each upwind state must reduce) could serve as a precedent for quantifying upwind state emission reduction responsibilities with respect to potential future NAAQS.
With respect to the 1997 ozone NAAQS, the Transport Rule requires NOx reductions starting in 2012 to ensure that reductions are made as expeditiously as practicable to assist downwind state attainment and maintenance of the standard.  Sources must comply by May 1, 2012.  The Transport Rule's compliance schedule and alignment with downwind NAAQS attainment deadlines are discussed in detail in section VII of the preamble.
EPA is taking no final action in this rule with respect to the relationship between the Transport Rule requirements and the visibility provisions of the CAA including the BART requirement.
Organization: Empire District Electric Company (Empire District)
Comment:
Empire District Electric Company (Empire District)
EPA has acknowledged that a CATR 2 is in development.  With the delay of CATR 1, timing to incorporate CATR 2 can be more adequately aligned with other developing regulations including MACT for electric generating units (EGU MACT).  The uncoordinated piecemeal approach to regulatory development has resulted in tremendous uncertainty for electric utilities.  The alignment of the initial compliance dates for CATR Phase II, CATR 2 and EGU MACT would provide for increased certainty. [EPA-HQ-OAR-2009-0491-2659.1, p.2]
In addition, we believe that EPA has avoided a critical issue in not determining that the Clean Air Transport Rule is `better than BART' as was defined in the final Best Achievable Retrofit Technology rule.  Given that CATR further restricts the transport of PM2.5 and ozone, in reality CATR is better than CAIR which was better than BART.  Empire District urges EPA to make such a determination.  Not only would such a determination provide clarity and certainty to the utility industry, it would be very beneficial to the states that have included CAIR in their SIPs for attaining the first reasonable progress goal for Regional Haze. [EPA-HQ-OAR-2009-0491-2659.1, p.3]
Response:
EPA is taking no final action in this rule with respect to the relationship between the Transport Rule requirements and the visibility provisions of the CAA including the BART requirement.
Please see section VII.C.1 of the preamble for discussion of why EPA selected 2012 and 2014 as important compliance deadlines for the Transport Rule programs.  EPA's analysis in this final rule shows substantial benefits from implementing this rule by the 2012 and 2014 deadlines, which represent the costs to public health and welfare that Americans would incur without successful implementation of this rule; the cost of delay is therefore of considerable consequence to the public.  EPA cannot rely on keeping CAIR in place in the interim, since the Court specifically found these programs to be illegal and only allowed them to remain in place on the basis that EPA would act as quickly as possible to replace them with programs consistent with its statutory authority under the Clean Air Act.  EPA believes it would be inappropriate to risk vacatur of these programs while delaying the promulgation of a replacement rule.
Organization: Florida Department of Environmental Protection
Mississippi Department of Environmental Quality
we energies
Indiana Department of Environmental Management
Iowa Department of Natural Resources (IDNR)
Tennessee Valley Authority (TVA)
Minnesota Pollution Control Agency (MPCA)
State of Wisconsin, Department of Natural Resources
Michigan Department of Natural Resources and Environment
Xcel Energy Inc.
RRI Energy, Inc.
Wisconsin Power and Light Company
Santee Cooper
Class of '85 Regulatory Group
Comment:
Class of '85 Regulatory Group
BART Compliance.
Sources subject to best available retrofit technology ('BART') requirements currently have the option of complying with CAIR as a mechanism for complying with BART (often referred to as CAIR = BART). The Proposal does not address whether CATR provides a similar compliance mechanism for BART units. State implementation plans for BART are due in January 2011. Accordingly, it is important that EPA confirm as soon as possible that compliance with CATR's reductions for SO2 and NOx meet compliance obligations for units subject BART. [EPA-HQ-OAR-2009-0491-2854.1,p.14]
Florida Department of Environmental Protection
Upon initial review, it was not clear how this rule impacts the Best Available Retrofit Technology (BART) program. As you may recall, under CAIR, electric utilities were not subject to BART for SO2 and NOx. [EPA-HQ-OAR-2009-0491-2624.1, p.1]
Indiana Department of Environmental Management
In the future, further emission reductions from both regional and local sources may be needed in order to attain more stringent NAAQS. [EPA-HQ-OAR-2009-0491-2645.1, p.1]
Although not applying directly to ozone or fine particles, U.S. EPA needs to issue a Best Available Retrofit Technology (BART) equivalency determination for sources affected by the final Transport Rule, as was done in conjunction with the Clean Air Interstate Rule (CAIR). [EPA-HQ-OAR-2009-0491-2645.1, p.2]
Iowa Department of Natural Resources (IDNR)
A finding that participation in the Transport Rule would satisfy Best Available Retrofit Technology (BART) requirements should be incorporated into the Transport Rule. Participation in the Clean Air Interstate Rule served as an alternative solution to fulfill the BART obligations related to the July 1999, Regional Haze Rule. We recommend EPA similarly conclude that BART requirements would be satisfied if a BART eligible source participates in the Transport Rule under annual NOx and SO2 emissions caps. [EPA-HQ-OAR-2009-0491-2609.1, p.2]
Michigan Department of Natural Resources and Environment
The DNRE requests clarification about the EGUs and the BART requirements. In the Regional Haze regulations, a determination was made on BART requirements for subject EGUs. In 40 CFR 51.308(e)(4), the EPA determined that CAIR was better than BART. The EPA failed to address this previous determination when proposing the TR. The EPA has indicated that they would be providing a determination on the BART issues for EGUs with the first publication of a PM25 SIP approval. The DNRE believes the uncertainty this leaves for EGU BART obligations is unacceptable and requests that the EPA address the issue of BART for EGUs. This lack of guidance leaves uncertainty for the states and EGUs. [EPA-HQ-OAR-2009-0491-2774.1 p.7]
Minnesota Pollution Control Agency (MPCA)
Finally, the MPCA encourages EPA staff working on the Transport Rule to work closely with EPA staff working on Regional Haze in order to provide the necessary information for making a determination if the Transport Rule can be deemed to be better than Best Available Retrofit Technology (BART) under the Regional Haze program. [EPA-HQ-OAR-2009-0491-2521.1, p.2]
Mississippi Department of Environmental Quality
It was determined that the CAIR rule was sufficient to meet the BART and Reasonable Progress requirements of the Regional Haze rule, but no such provision is given for the Transport Rule. The Transport rule gives greater reductions than CAIR and the limitations on trading further assures that reductions will occur where they are needed. As such, we would encourage EPA to make the provision in this rule that the Transport Rule is sufficient to meet the BART and Reasonable Progress requirements of the Regional Haze Rule. [EPA-HQ-OAR-2009-0491-2634.1, p.2]
RRI Energy, Inc.
The CATR should be identified as an acceptable alternative for BART for Regional Haze as was done for CAIR. The emissions reductions mandated by the proposed CATR are in excess and earlier than those specified under CAIR which provide credibility for that situation. [EPA-HQ-OAR-2009-0491-2717.1 p.5]
Santee Cooper
EPA either should confirm that compliance with the Transport Rule is compliance with EGU requirements for Best Available Retrofit Technology (BART), or explain why it is not. [EPA-HQ-OAR-2009-0491-2820.1, p.2]
EPA EITHER SHOULD CONFIRM THAT COMPLIANCE WITH THE TRANSPORT RULE IS COMPLIANCE WITH THE BART REQUIREMENTS, OR EXPLAIN WHY IT IS NOT. [EPA-HQ-OAR-2009-0491-2820.1, p.10]
Santee Cooper urges EPA to clarify the interaction between the Transport Rule and the Regional Haze Rule. In particular, Santee Cooper requests that EPA determine whether compliance with the Proposed Rule constitutes compliance with BART requirements. [EPA-HQ-OAR-2009-0491-2820.1, p.10]
On July 6, 2005, EPA finalized revisions to the Regional Haze Rule, including guidelines for BART determinations. In its 2005 rulemaking, EPA determined that the CAIR made greater reasonable progress than would BART for SO2 and NOx at BART eligible EGUs in states covered by the CAIR. On this basis, EPA promulgated revisions to the Regional Haze regulations that provided that: [EPA-HQ-OAR-2009-0491-2820.1, p.10]
A State that opts to participate in the Clean Air Interstate Rule cap-and-trade and trade (sic) program under part 96 AAAEE need not require affected BART-eligible EGU's (sic) to install, operate, and maintain BART. [EPA-HQ-OAR-2009-0491-2820.1, p.10]
EPA intends the Transport Rule to supplant the CAIR. Furthermore, the Transport Rule would achieve deeper reductions of SO2 and NOx than the CAIR. Yet, the Transport Rule is silent as to whether the CATR will be 'better than BART,' and therefore whether states may rely on reductions resulting from the CATR as a compliance alternative for otherwise BART-eligible EGUs. [EPA-HQ-OAR-2009-0491-2820.1, p.10]
EPA's silence on the interaction of the Transport Rule and BART requirements frustrates compliance planning both for states and for the power sector. It also represents a missed opportunity to promote coordination and efficiency. In these respects, the Transport Rule is inconsistent with the Agency's commitment, made in the preamble, to 'promote and facilitate the most cost-effective and forward-looking compliance investments and strategies on the part of the power sector." [EPA-HQ-OAR-2009-0491-2820.1, pp.10-11]
For these reasons, Santee Cooper urges EPA to include in the final version of the Transport Rule a determination that the Transport Rule is better than BART and that covered states may rely on the CATR as an alternative means of compliance for BART eligible EGUs - or explain why such a determination is not possible. [EPA-HQ-OAR-2009-0491-2820.1, p.11]
State of Wisconsin, Department of Natural Resources
Better inform Wisconsin facility/source decision-making regarding related emission controls coming on line in the near future, including those expected from additional Title 1 requirements, Title 3 requirements and evolving carbon control policies. [EPA-HQ-OAR-2009-0491-2829.2, p.1; This comment can also be found at section III.D of this comment summary]
EPA needs to clarify the impact of the proposed Transport Rule on the BART program and Haze SIP requirements within the final rule Preamble specifically in regard to whether Transport Rule = BART as was the case with CAIR = BART. [EPA-HQ-OAR-2009-0491-2829.2, p.13]
Preferred Equivalency Approach - If EPA proposes such equivalency, it needs to demonstrate it on a state-by-state basis incremental to the projected 2012 budgets which include currently committed and under construction installations which are not part of the Clean Air Transpoort Rule. BART assessments for the upper Midwest should target 2015 - five years after the first anticipated Regional Haze SIP approval The assessment should compare air quality impact improvement from all EGU BART eligible facilities using presumptive controls as an increment to 2012 Budgets in the same fashion that IPM identifies incremental controls from the 2012 budgets needed to meet 2014 budgets. BART equivalency would be indicated by the approach that produces the visibility improvement as required under the Haze Rule. [EPA-HQ-OAR-2009-0491-2829.2, pp.13-14]
Without clarification, facilities remain uncertain regarding their scope of liabilities to address BART requirements as part of the Regional Visibility Improvement SIPs. [EPA-HQ-OAR-2009-0491-2829.2, p.14]
Tennessee Valley Authority (TVA)
A. Issue: In developing the CAIR rule, EPA took the position that States which adopt the CAIR cap and trade program for SO2 and NOx would be allowed to treat the participation of EGUs in this program as a substitute for the application of Regional Haze BART controls (i.e. the CAIR=BART presumption). This position was based on modeling done by EPA to demonstrate that CAIR emissions reductions as modeled produce significantly greater visibility improvements than source-specific BART. In the proposed Transport Rule, EPA does not create a similar presumption equating the Transport Rule to BART. [EPA-HQ-OAR-2009-0491-2782.1, pp. 15-16]
TVA Comment: EPA determined through modeling that CAIR controls are better than BART for EGUs, and that CAIR achieves greater progress than BART towards meeting the visibility goal. See 70 Fed. Reg. 25303-04 (May 12, 2005) Based on this determination, EPA created the CAIR-BART presumption. The legal principle in creating a CAIR-BART presumption was affirmed by D.C. Circuit in 2006. See Utility Air Regulatory Group v. EPA, 471 F.3d 1333 (D.C. Cir. 2006) Since the Transport rule will reduce SO2 and NOx emissions below CAIR levels, EPA should include in the Transport Rule a provision allowing States that adopt the Transport Rule requirements for SO2 and NOx to treat the participation of EGUs in the program as a substitute for the application of BART controls for these pollutants to affected EGUs. This will relieve needless regulatory burden on the states and regulated engities. [sic] [EPA-HQ-OAR-2009-0491-2782.1, p. 16]
we energies
The Clean Air Interstate Rule (CAIR) properly addressed the Best Available Retrofit Technology (BART) requirements of EPA's regional haze rule by establishing CAIR to be equivalent to BART for SO2 and NOx. EPA needs to clarify that the NOx and SO2 reductions in the transport rule satisfy utility BART requirements. EPA has already substantiated this through modeling associated with the CAIR, but should re-confirm transport rule coverage of utility BART obligations. We ask that EPA address this important issue in the current rule-making rather than deferring this to a future date, or as related to other regional haze rule activity. This regulatory certainty is very important to EGU's in order to optimize planning and installation of necessary control systems. [EPA-HQ-OAR-2009-0491-2629.1, p.7]
Wisconsin Power and Light Company
Given the increased stringency of the proposed CATR program compared to CAIR, WPL believes that these reductions address S02 and NOx reductions required for EGUs subject to Best Available Retrofit Technology (BART). Sources subject to BART currently have the option of complying with CAIR as a mechanism for complying with BART (often referred to as 'CAIR equals BART'). State implementation plans for BART are due in January 2011. WPL believes that EPA should confirm that CATR equals BART compliance for S02 and NOx as expeditiously as possible, but no later than by issuance of this final rule. [EPA-HQ-OAR-2009-0491-2844.1 p.4]
Xcel Energy Inc.
2. EPA should clearly state that CATR is BART.
EPA should clearly state that compliance with CATR requirements satisfies the Best Available Retrofit Technology (BART) requirements under the Regional Haze rule. In particular, EPA should inform the states that they are not obligated to undertake the 5-factor analysis for every BART affected unit in each state, if the state adopts the CATR regulations as a SIP or defers to EPA's proposed FIP. Under the CAIR role EPA clearly stated that a state's adoption of CAIR satisfied its BART obligations. As CATR is more stringent than CAIR, CATR should also be viewed as BART. [EPA-HQ-OAR-2009-0491-2728.1, pp.11-12]
Response:
EPA appreciates the comments regarding the relationship of the transport rule to the BART requirement.  EPA recognizes that EPA's regional haze regulations provide for trading program alternatives to the BART requirement.  EPA's BART guidelines were published on July 6, 2005.  70 FR 39104.   In the final BART guidelines notice, EPA determined that CAIR achieved greater progress than BART and could be used by States as a substitute for BART at affected EGUs.  70 FR 39137.
Following promulgation of the Transport Rule, we intend to conduct a similar analysis of the transport rule to determine whether it would achieve greater reasonable progress toward the national visibility goal than BART.   We believe it is best to conduct this analysis once the transport rule requirements are final and certain.  If the analysis supports the conclusion that the transport rule achieves greater reasonable progress than BART, we intend to proceed with a notice and comment rulemaking that would provide that compliance with the Transport Rule satisfies BART requirements in certain states.    Because this analysis is not yet complete, we cannot make any representations in this rule regarding whether the Transport Rule achieves greater reasonable progress than BART.   We do, however, intend to complete this analysis as quickly as possible and hope to complete a rulemaking addressing the Transport Rule and BART by spring 2012.
Organization: Gulf Coast Lignite Coalition
Comment:
Gulf Coast Lignite Coalition
I. EPA Should Extend the Transport Rule Compliance Dates to Accommodate Pending Federal Standards and State Emission Reduction Target Deadlines.
EPA proposes that the initial phase of emission reductions will begin in 2012 (less than one year after the rule is finalized), requiring sulfur dioxide (SO2) and nitrogen oxide (NOX) reductions in those 31 states covered for the 24-hour and/or annual PM2.5 National Ambient Air Quality Standards (NAAQS) as well as the 8-hour ozone NAAQS.1 A second round of additional SO2 reductions would be required for "Group 1" states in 2014 and EPA is considering additional NOX reductions in a future proposal for the ozone NAAQS (Transport Rule II). [EPA-HQ-OAR-2009-0491-2734.1 p.1]
The Transport Rule sets new emission budgets for each state and requires compliance with set emission reductions by 2012. With such a quick compliance deadline less than one year after the final rule is published, it is not clear how states will coordinate emission reduction mandates from the federal level with ongoing efforts at the state level.   [EPA-HQ-OAR-2009-0491-2734.1 p.2]
For example, Texas is in the middle of demonstrating attainment for several of their nonattainment regions for the 1997 8-hour ozone standard. Specifically, the Texas Commission on Environmental Quality (TCEQ) recently adopted the Houston Galveston Brazoria (HGB) Attainment Demonstration SIP Revision and the HGB Reasonable Further Progress SIP revision for the 1997 8-hour ozone standard. In this latest SIP revision, Texas will be demonstrating an 18% emission reductions, with 3% reductions between 2008, 2011, 2014, 2017, and 2018. Now, the EPA is proposing NOX emission reductions under the Transport Rule with a compliance date of 2012. Further complexity will be inserted by the planned adoption of a revised Ozone NAAQS, which will trigger a host of additional SIP Revision activities. Layering so many regulatory compliance timelines and developments on top of each other will cause confusion for state regulatory agencies, the regulated community, and the general public.  [EPA-HQ-OAR-2009-0491-2734.1 p.2]
Overly complicated compliance deadlines and little advance notice of changing regulatory requirements is a recipe for disaster given the current economic conditions. Put simply, the regulated community needs as much advance notice and flexibility as possible in times like these when capital is hard to come by and sensitivity to increased residential and industrial utility bills is at its highest. While it may be cumbersome to match compliance dates on a state and federal level, EPA should at a minimum extend the compliance deadlines beyond 2012. [EPA-HQ-OAR-2009-0491-2734.1 p.2]
EPA has set out a number of "Key Guiding Principles" in the preamble of the proposed Transport Rule, one of which is to "Provide [a] Workable Approach for EPA and States." Here, EPA is requesting compliance with the Transport Rule by 2012, a very short compliance timeframe considering the myriad of environmental regulations undergoing review and revision during the next few years, some of which form the basis of the Transport Rule (e.g., 1997 8-hour ozone NAAQS). EPA should consider the breadth of environmental regulations, including but not limited to regulations for hazardous air pollutants, new source performance standards, and greenhouse gas regulations. Failure to consider these ongoing emission reduction efforts by the states and pending regulations does not comport with the Key Guiding Principle to Provide a Workable Approach for EPA and the states. [EPA-HQ-OAR-2009-0491-2734.1 p.3]
Regulations with a short shelf life do not afford regulated entities sufficient time to request, acquire and implement the necessary control technology to meet the changing standards. The regulated community requires regulatory stability and certainty in order to properly plan and execute capital expenditures required for additional control technology.   [EPA-HQ-OAR-2009-0491-2734.1 p.4]
While GCLC understands the need to address the remanded Clean Air Interstate Rule (CAIR), the U.S. Court of Appeals did not set a specific timeline by which EPA should substitute CAIR with a new rule.1 GCLC requests that the EPA relax the compliance deadlines in the Transport Rule in order to acknowledge the complexity and burdens associated with the many standards that will be revised within the next year or two. [EPA-HQ-OAR-2009-0491-2734.1 p.4]
1 See State of North Carolina v. EPA, Case No. 05-1244 (D.C. Cir. December 23, 2008). "...Some Petitioners have suggested that this court impose a definitive deadline by which EPA must correct CAIR's flaws. Notwithstanding these requests, the court will refrain from doing so."
Response:
EPA's approach in the Transport Rule to measure and address each state's significant contribution to downwind nonattainment and interference with maintenance is guided by and consistent with the Court's opinion in North Carolina and addresses the flaws in CAIR identified by the Court therein.  The final rule also responds to extensive public comments and stakeholder input received during the public comment periods in response to the proposal and subsequent Notices of Data Availability (NODAs), and will provide greater certainty to affected sources and states.  The extensive analyses of this final rule indicate that there will be modest impacts on electricity prices, utilities, and consumers.
As discussed in section III of the Preamble to this rule, EPA will provide full opportunity for notice and comment on each rule as they are proposed and finalized.  EPA will also include the final Transport Rule in its regulatory impact analyses of subsequent rulemakings.
EPA will coordinate utility-related air pollution rules with each other and with other actions affecting the power sector including these rules from EPA's Office of Water and its Office of Resource Conservation and Recovery to the extent consistent with legal authority in order to provide timely information needed to support regulated sources in making informed decisions.  Use of a small number of air pollution control technologies, widely deployed, can assist with compliance for multiple rules.  EPA also notes that the flexibility inherent in the allowance-trading mechanism included in the Transport Rule affords utilities themselves a degree of latitude to determine how best to integrate compliance with the emissions reduction requirements of this rule and those of the other rules.  EPA will pursue energy efficiency improvements in the use of electricity throughout the economy, along with other federal agencies, states and other groups, which will contribute to additional environmental and public health improvements while lowering the costs of realizing those improvements.
The approach embodied within the rule is partly designed to improve the planning process for the NAAQS, is readily applicable to any current and future NAAQS, and would automatically adjust the stringency of the transport threshold to maintain a constant relationship with the stringency of the relevant NAAQS as they are revised.  EPA believes that the final Transport Rule demonstrates the value of this approach for addressing the role of interstate transport of air pollution in communities' ability to comply with current and future NAAQS.  EPA believes that the Transport Rule's approach of using air-quality thresholds to determine upwind-to-downwind-state linkages and using the cost- and air quality-based multi-factor approach to quantify significant contribution to nonattainment and interference with maintenance (i.e., to determine the specific amount of emissions that each upwind state must reduce) could serve as a precedent for quantifying upwind state emission reduction responsibilities with respect to potential future NAAQS.
With respect to the 1997 ozone NAAQS, the Transport Rule requires NOx reductions starting in 2012 to ensure that reductions are made as expeditiously as practicable to assist downwind state attainment and maintenance of the standard.  Sources must comply by May 1, 2012.  The Transport Rule's compliance schedule and alignment with downwind NAAQS attainment deadlines are discussed in detail in section VII of the preamble.
Organization: Indiana Builders Association
Comment:
Indiana Builders Association
This rule could cause the premature closure of some coal-based generation plants in my state, which will have severe economic consequences for our members, our communities and our local revenues. [EPA-HQ-OAR-2009-0491-2871.1, p.2]
In addition to the costs to comply, there is the economic harm my members will incur if some coal-fired power plants are forced to retire prematurely. Each plant supports hundreds of good paying jobs, at a time when there are few comparable employment opportunities. Closing these plants early will only lengthen the time needed for this nation to recover from the recession and will exacerbate a growing state and local budget problem through lost income tax revenues. [EPA-HQ-OAR-2009-0491-2871.1, p.3]
We applaud the EPA's efforts to improve air quality for all Americans and to address downwind issues. However, we believe the EPA's actions are premature and do not allow enough time for state participation or for industry compliance. Hasty action will have economic consequences for our members without any assurance that the rule will deliver the desired results any faster than the nation can achieve on its current path. [EPA-HQ-OAR-2009-0491-2871.1,p.3]
Response:
As discussed in Section VII.C of the Preamble, EPA believes the 2012 and 2014 deadlines are feasible and the rule itself will not result in significant coal retirements or reliability challenges.  In addition, the rule is anticipated to have some positive employment impacts in the pollution control and construction industry as new environmental controls are needed to meet the requirements of the rule.
Organization: Kentucky Chamber of Commerce
Comment:
Kentucky Chamber of Commerce
Coal plant emissions can continue to be reduced in a realistic, more cost-effective manner through multi-pollutant legislation that achieves equivalent environmental benefits without threatening the economic viability of our communities or the reliability of our power system.  [EPA-HQ-OAR-2009-0491-2760.1 p.2]
Response:
EPA must follow existing law, as passed by Congress, and must follow direction from Courts where relevant.  EPA is promulgating the Transport Rule in response to the remand of the Clean Air Interstate Rule (CAIR) by the U.S. Court of Appeals for the District of Columbia Circuit ("Court") in 2008.  Opportunities to update existing law must be considered by Congress, and multi-pollutant legislation is one possible mechanism that could potentially achieve greater environmental benefits and lower cost.
Organization: Minnesota Power
Comment:
Minnesota Power
Additionally, the Minnesota Pollution Control Agency had facilitated a Minnesota stakeholder process for addressing final Regional Haze (Clean Air Visibility Rule) requirements for targeted 2013 compliance with Reasonable Further Progress targets for Minnesota Class I Wilderness Areas.  The MPCA Northeast Regional Emissions Abatement Program called for about a 30% reduction in Northeast Minnesota utility emissions that, coupled with other regional emission reductions (e.g. MERP and AREA), would satisfy Minnesota regional haze, reasonable further progress requirements on schedule. It is not clear in EPA's Transport Rule, Technical Support Documents whether EPA gave consideration to Minnesota non-utility source emission reductions from this Minnesota visibility improvement initiative, but it does appear that EPA is incorrectly associating the Minnesota emission reduction measures with CAIR compliance action even though the CAIR has been stayed for Minnesota implementation pending this Transport Rule finalization.  [EPA-HQ-OAR-2009-0491-2750.1, p.4]
The MPCA has submitted the Minnesota Regional Haze SIP to EPA for approval, but has not yet received confirmation that EPA has reviewed and approved the Northeast Minnesota emission reduction plan.  However, Minnesota utility sources have provided for the associated planned emission reductions at timing to meet the MPCA program regional haze targets, as cited in the Minnesota State Implementation Plan submitted to EPA.  Still, those Minnesota emission reduction measures appear to have been acknowledged by EPA when they suggest that States should be able to meet EPA's Transport Rule proposed 2012 SO2 and NOx budget emission limitations.  [EPA-HQ-OAR-2009-0491-2750.1, p.4]
Perform new formal rule makings and public comments before implementing any proposed new emission reductions.  Minnesota Power requests that EPA address any further measures that would impose additional reductions on Minnesota sources in a separate rule making that provides adequate time for public review and comments of EPA's justifying criteria for additional controls.  The current proposed Transport Rule does not provide adequate justification for further ratcheting down of budgets, since related control requirements may not meet reasonable criteria for emission reduction measures and cost effectiveness.  [EPA-HQ-OAR-2009-0491-2750.1, pp.6-7]
Response:
EPA's approach in the Transport Rule to measure and address each state's significant contribution to downwind nonattainment and interference with maintenance is guided by and consistent with the Court's opinion in North Carolina and addresses the flaws in CAIR identified by the Court therein.  The final rule also responds to extensive public comments and stakeholder input received during the public comment periods in response to the proposal and subsequent Notices of Data Availability (NODAs).  EPA has provided for adequate time for public comment.
As described in section VI of the preamble for the final Transport Rule, EPA reassessed SO2 and ozone season and annual NOx reductions for the final Transport Rule.  Please refer to this section for further details.  In addition, see preamble section V for more detail on analysis of air quality and upwind state emissions.
Minnesota's maximum contribution to nonattainment for daily PM NAAQS was 0.61 ug/m3, well above the threshold.  EPA included enforceable emission reduction agreements or targets in its analysis done in support of the significant contribution analysis, and the agreements mentioned by the commenter do not fall within this definition.  In addition, the commenter provides no details regarding the aforementioned emission reductions.
Organization: National Mining Association (NMA)
Comment:
National Mining Association (NMA)
EPA's coordinated regulatory agenda to reduce coal usage
EPA has undertaken a far-reaching regulatory program that is apparently designed to reduce the use of coal throughout the American economy. The coordinated nature of this program is most evident in the electric power sector, which EPA has undertaken to transform. Upon taking office, EPA formulated seven priorities, one of which was to "develop a comprehensive strategy for a cleaner and more efficient power sector, with strong but achievable reduction goals for SO2, NO2, mercury and other air toxics." This goal was reiterated by EPA in the proposed Transport Rule, where the Agency said that "[i]n furtherance of this priority goal, and to respond to statutory and judicial mandates, EPA is undertaking a series of regulatory actions over the course of the next 2 years that will affect the power sector in particular."  [EPA-HQ-OAR-2009-0491-2868.1, p.3]
These EPA rulemakings include:
:: The recently completed National Ambient Air Quality Standards ("NAAQS") for sulfur dioxide ("SO2") and nitrogen dioxide ("NO2");
:: The currently proposed new ozone NAAQS and the soon-to-be proposed new PM2.5 NAAQS;
:: The proposed Transport Rule and expected additional transport rules for the 1997 ozone NAAQS, the currently proposed new ozone NAAQS, and the soon-to-be-proposed new PM2.5 NAAQS;
:: The soon-to-be-proposed MACT standards for electric generating units ("EGUs");
:: EPA's greenhouse gas ("GHG") regulation under the Prevention of Significant Deterioration ("PSD") program; [EPA-HQ-OAR-2009-0491-2868.1,p.3]
:: The soon-to-be-proposed New Source Performance Standards for EGUs (including GHG NSPS);
:: Best Available Retrofit Technology ("BART") standards for EGUs;
:: The proposed regulations for coal combustion residues; and
:: The soon-to-be-proposed water quality regulations for cooling intake structures and soon-to-be-proposed effluent guidelines for discharges from power plants.  [EPA-HQ-OAR-2009-0491-2868.1,p.4]
Recognizing that all of these regulations are implementing a single overall priority goal and constitute a "comprehensive set of requirements," EPA pledged in the proposed Transport Rule to coordinate at least its power sector air quality regulations and, to the extent it could under relevant statutory law, to coordinate these power sector air quality regulations with the coal combustion residue regulations and the two power sector water quality regulations. EPA further pledged to "engage with other federal, state and local authorities, as well as with stakeholders and the public at large, with the goal of fostering investments in compliance that represent the most efficient and forward-looking expenditure of investor, shareholder, and public funds, resulting, in turn, in the creation of a clean, efficient, and completely modern power sector." [EPA-HQ-OAR-2009-0491-2868.1,p.4]
EPA's regulatory agenda for the power sector will almost certainly significantly reduce the use of coal for electric generation. While EPA so far has not done any study of the cumulative impact of these regulations on coal use (or otherwise), the contractor EPA uses to model impacts of individual regulations recently produced its own analysis showing that just the EGU MACT standards alone will force major retirements of coal-fueled power-plants. [EPA-HQ-OAR-2009-0491-2868.1,p.4]
A recent report by Credit Suisse (copy attached) examined the effect of the Transport Rule and the upcoming EGU MACT rules and determined that:
:: About 60 GW of coal-fueled capacity will likely close between 2013 and 2017.
:: $70-$100 billion of capital expense in emission control equipment.
:: A 15-31% reduction in the use of coal for electric generation. [EPA-HQ-OAR-2009-0491-2868.1,p.4]
:: MISO, SERC, PJM-West, and SPP will see an "accelerating reversion to 15% reserve margins."
:: EPA's standards cannot be met unless compliance deadlines are extended to 2017. [EPA-HQ-OAR-2009-0491-2868.1,p.5]
Forced retirements will have substantial negative economic impacts nationally, but will also have severe impacts locally, as exemplified by the Arizona Hopi and the Navajo Generation Station:
Scott Canty, the Hopi Nation`s general counsel, explained to a panel of lawmakers on Nov. 2 that closure of the Navajo Generating Station would cripple the tribal government. The Hopi Nation relies heavily on coal revenues to fund its government, Canty said. About 88 percent of the tribal government`s budget comes from revenue generated by coal-fired energy production at the Navajo Generating Station, Canty said. . . . The EPA has proposed rules that would require the power plant to install expensive emissions equipment to address visibility impairment issues at the Grand Canyon. But the plant's owners and the tribes argue that the retrofit is too costly. [EPA-HQ-OAR-2009-0491-2868.1,p.5]
Moreover, news accounts recently reported that EPA is well aware that its regulatory efforts in the power sector will increase the costs to coal-fueled EGUs and make them less competitive with renewable resources. In an article entitled "Administration Eyes EPA Rules To Spur Shift From Coal To Renewables," it was reported that:
Rob Brenner of EPA's Office of Air & Radiation told a July 28 meeting of the agency's environmental justice advisers that pending rules to control emissions, waste and water discharges from utilities will not only protect public health but add costs to the industry that might make renewable energy a more viable alternative.
"We need to set health-based standards for power plants, and once we do that then they can compete with some of these renewable sources," Brenner said at the National Environmental Justice Advisory Committee (NEJAC) meeting in Washington, DC. He added later, "It's not really a fair competition because [coal-fired power plants] are cheaper than they should be because they're not controlling their pollutants" to their full extent because EPA is yet to issue key rules for the sector, including a mercury air rule and a plan to regulate coal combustion residue.8 [EPA-HQ-OAR-2009-0491-2868.1,pp.5-6]
The same article reported that the White House also understands that transforming the power sector will inevitably result in reduced use of coal and increased use of renewables. Referring to remarks of Nancy Sutley, Chair of the White House Council on Environmental Quality, the article reported that:
Sutley responded that she doubts the existence of so called clean coal. "Other people have labeled it `clean coal,'" she said. "I don't know if I would necessarily concede that that is real. . . . I think in the long run, not just for the [United States] but for the world, that developing and making sure that there is access to these inherently cleaner sources of energy is important. . . . . We need to use energy more efficiently and more cleanly." [EPA-HQ-OAR-2009-0491-2868.1,p.6]
Other EPA regulatory proposals are also part of an overall strategy to reduce the use of coal throughout the economy. This strategy includes the Boiler MACT and Area Source rule on which EPA recently took comment. In the regulatory preamble to the Boiler MACT rule proposal, EPA stated forthrightly that its reason for proposing strict MACT standards for coal boilers and process heaters but only work practice standards for natural gas boilers was to incent coal boilers to switch to natural gas and to disincent natural gas boilers from switching to coal. In discussing this issue, EPA made plain that it considers coal to be a "dirty" fuel whose use is inconsistent with the CAA and therefore should be discouraged. In contrast, EPA considers natural gas to be a "clean fuel" whose use should be encouraged at coal's expense. According to EPA: [EPA-HQ-OAR-2009-0491-2868.1,p.6]
In addition, emission limits on gas-fueled boilers and process heaters may have the negative effect of providing an incentive for a facility to switch from gas (considered a "clean" fuel) to a "dirtier" but cheaper fuel (i.e., coal). [EPA-HQ-OAR-2009-0491-2868.1,pp.6-7]
The coal industry also faces a panoply of prospective regulation of the process of producing coal. These regulations include potentially stricter NAAQS for PM10 which may make western surface mining untenable, new restrictions on coal mine permitting in Appalachia that could result in major reductions in surface and underground coal mining in that region, and potential imposition of NSPS standards on mining emissions of PM10, methane, volatile organic compounds, and nitrogen oxides. All of these regulations together -- EPA's power sector regulations, its regulations for the use of coal in the manufacturing and commercial sectors, and its regulations of coal mining -- all have the potential to combine to cumulatively and dramatically reduce coal usage. [EPA-HQ-OAR-2009-0491-2868.1,p.7]

8. Administration Eyes EPA Rules to Spur Shift from Coal to Renewables, InsideEPA.com (July 29, 2010), at http://insideepa.com/201007291915893/EPA-Daily-News/Daily-News/administration-eyesepa-rules-to-spur-shift-from-coal-to-renewables/menu-id-95.html.
Response:
EPA's approach in the Transport Rule to measure and address each state's significant contribution to downwind nonattainment and interference with maintenance is guided by and consistent with the Court's opinion in North Carolina and addresses the flaws in CAIR identified by the Court therein.  The final rule also responds to extensive public comments and stakeholder input received during the public comment periods in response to the proposal and subsequent Notices of Data Availability (NODAs), and will provide greater certainty to affected sources and states.  The extensive analyses of this final rule indicate that there will be modest impacts on electricity prices, utilities, and consumers while providing significant health benefits to the public.
As discussed in section III of the Preamble to this rule, EPA will provide full opportunity for notice and comment on each rule as they are proposed and finalized.  EPA will also include the final Transport Rule in its regulatory impact analyses of subsequent rulemakings.
EPA will coordinate utility-related air pollution rules with each other and with other actions affecting the power sector including these rules from EPA's Office of Water and its Office of Resource Conservation and Recovery to the extent consistent with legal authority in order to provide timely information needed to support regulated sources in making informed decisions.  Use of a small number of air pollution control technologies, widely deployed, can assist with compliance for multiple rules.  EPA also notes that the flexibility inherent in the allowance-trading mechanism included in the Transport Rule affords utilities themselves a degree of latitude to determine how best to integrate compliance with the emissions reduction requirements of this rule and those of the other rules.  EPA will pursue energy efficiency improvements in the use of electricity throughout the economy, along with other federal agencies, states and other groups, which will contribute to additional environmental and public health improvements while lowering the costs of realizing those improvements.
The approach embodied within the rule is partly designed to improve the planning process for the NAAQS, is readily applicable to any current and future NAAQS, and would automatically adjust the stringency of the transport threshold to maintain a constant relationship with the stringency of the relevant NAAQS as they are revised.  EPA believes that the final Transport Rule demonstrates the value of this approach for addressing the role of interstate transport of air pollution in communities' ability to comply with current and future NAAQS.  EPA believes that the Transport Rule's approach of using air-quality thresholds to determine upwind-to-downwind-state linkages and using the cost- and air quality-based multi-factor approach to quantify significant contribution to nonattainment and interference with maintenance (i.e., to determine the specific amount of emissions that each upwind state must reduce) could serve as a precedent for quantifying upwind state emission reduction responsibilities with respect to potential future NAAQS.
In addition, the commenter cites reports erroneously and attributes the reports findings to EPA regulatory actions, when in fact the reports were identifying many factors that are influencing power sector dynamics and costs (e.g., lower than expected electricity demand and natural gas supply/prices).  The reports also relied upon a misinformed interpretation of potential EPA regulatory actions since some of the aforementioned rules that were modeled had yet to be proposed and were assumed to be much more stringent than they actually were.  It is useful to cite analysis that makes sense, and it is not useful to misinterpret results from analyses.  There certainly will not be any "forced retirements," sources have many options for compliance and EPA has included flexible elements wherever possible.
The CAA, passed by Congress in 1970 and amended in 1990, sets forth a framework for the protection citizens from pollution, and EPA is responding to that framework (and Court direction) to ensure that standards are met cost-effectively and efficiently, while incorporating flexibility wherever possible.  In addition, EPA analysis indicate that impacts on coal will be modest and will not result in significant shifts away from coal.  In fact, much of the coal fleet will find it cost effective to install a variety of widely available pollution controls, many of which can remove multiple pollutants and will help meet more than one requirement.
Organization: New Jersey Department of Environmental Protection (NJDEP)
Comment:
New Jersey Department of Environmental Protection (NJDEP)
[These comments were submitted as testimony at the Philadelphia, Pennsylvania public hearing on August 26, 2010.  See Docket Number EPA-HQ-OAR-2009-0491-1938, pp.158-159.]
New Jersey submitted on May 12, 2010, a Section 126 petition to the USEPA seeking reductions in emissions from the Portland Plant due to its significant contribution to nonattainment, and interference with maintenance, of the sulfur dioxide SO2 and 24-hour fine particulate matter PM 2.5 NAAQS in New Jersey.
The units at the Portland Plant, built in the 1950s and 1960s, have no SO2 emission controls and outdated control technology for NOX and particulate emissions. This petition was based on air quality modeling and the 24 hour SO2 standard.
Based on the new one-hour SO2 standard promulgated in June, the Department predicts that the Portland Plants sulfur dioxide impact on the air quality is much greater, causing nonattainment in a much larger area in New Jersey and Pennsylvania. While EPAs transport rule is a positive step, additional regulatory tools are needed to address plants like Portland.
Response:
EPA's approach in the Transport Rule to measure and address each state's significant contribution to downwind nonattainment and interference with maintenance is guided by and consistent with the Court's opinion in North Carolina and addresses the flaws in CAIR identified by the Court therein.  The final rule also responds to extensive public comments and stakeholder input received during the public comment periods in response to the proposal and subsequent Notices of Data Availability (NODAs), and will provide greater certainty to affected sources and states.  The extensive analyses of this final rule indicate that there will be modest impacts on electricity prices, utilities, and consumers while providing significant health benefits to the public.  EPA anticipates that units at the Portland Plant would likely install pollution controls to reduce emissions SO2 and other harmful pollutants, in response to the requirements of the Transport Rule.
Organization: Owensboro Municipal Utilities (OMU)
Comment:
Owensboro Municipal Utilities (OMU)
EPA Should Clearly State That the Final Transport Rule Satisfies the Requirements of BART and Defers Section 126 Findings.
In developing the CAIR rule, EPA took the position that States adopting the CAIR cap-and-trade program for SO2 and NOx would be allowed to consider the participation of EGUs in this program as equivalent to the application of best available retrofit technology (BART) controls (i.e., the CAIR-BART presumption) for those pollutants. This position was based on modeling done by EPA to demonstrate that CAIR emissions reductions as modeled produce significantly greater visibility improvements than source-specific BART. In the proposed Transport Rule, EPA does not create any such presumption equating the Transport Rule to BART. [EPA-HQ-OAR-2009-0491-2811.1,pp.3-4]
Since EPA appropriately determined that compliance with CAIR exceeded the visibility improvements that would result from BART, and since the Transport Rule will reduce SO2 and NOx emissions below CAIR levels, EPA should include in the Transport Rule a provision that treats EGU compliance with the Transport Rule as equivalent to the application of Regional Haze BART controls. [EPA-HQ-OAR-2009-0491-2811.1, p.4]
Additionally, in developing CAIR, EPA set forth its general view of the approach it expected to take in responding to any section 126 petition that might be submitted relying on the same record as CAIR. Under that approach, as long as an upwind state remained on track to comply with CAIR, EPA would defer making the Section 126 findings. In the proposed Transport Rule, EPA does not discuss how petitions under Section 126 will be handled. [EPA-HQ-OAR-2009-0491-2811.1,p.4]
EPA should set forth a position in the Transport Rule that, as long as an upwind state remains on track with compliance with the Transport Rule, EPA will defer making Section 126 findings. This would avoid a de novo review by EPA of petitions filed by states that would lead to uncertainty for the regulated community and consume EPA and state resources for no environmental benefit. [EPA-HQ-OAR-2009-0491-2811.1,p.4]
Response:
EPA appreciates the comments regarding the relationship of the transport rule to the BART requirement.  EPA recognizes that EPA's regional haze regulations provide for trading program alternatives to the BART requirement.  EPA's BART guidelines were published on July 6, 2005.  70 FR 39104.   In the final BART guidelines notice, EPA determined that CAIR achieved greater progress than BART and could be used by States as a substitute for BART at affected EGUs.  70 FR 39137.
Following promulgation of the Transport Rule, we intend to conduct a similar analysis of the transport rule to determine whether it would achieve greater reasonable progress toward the national visibility goal than BART.   We believe it is best to conduct this analysis once the transport rule requirements are final and certain.  If the analysis supports the conclusion that the transport rule achieves greater reasonable progress than BART, we intend to proceed with a notice and comment rulemaking that would provide that compliance with the Transport Rule satisfies BART requirements in certain states.    Because this analysis is not yet complete, we cannot make any representations in this rule regarding whether the Transport Rule achieves greater reasonable progress than BART.   We do, however, intend to complete this analysis as quickly as possible, and we hope to complete a rulemaking addressing the Transport Rule and BART by spring 2012.
Organization: Ozone Transport Commission (OTC)
NRG Energy
NextEra Energy, Inc.
South Carolina Department of Health and Environmental Control
Northern Indiana Public Service Company (NIPSCO)
Public Utilities Commission of Ohio
Northwest Indiana Forum
Sierra Club, Pennsylvania Chapter
Texas Mining and Reclamation Association
Sierra Club, New Jersey Chapter
Comment:
NextEra Energy, Inc.
NextEra Energy encourages EPA to coordinate the proposed rulemaking with other regulations affecting the electric sector.
The Transport Rule is one of several rules affecting the electric sector that EPA will be implementing over the next five to ten years. Each of these rules will impact the industry and companies' long term planning decisions. To enable companies to make decisions consistent with EPA's long-term vhiotl, NextEra Energy encourages EPA to coordinate the upcoming regulations to the extent EPA has the legal authority to do so. We also support the coordination of regulations among EPA's air, water, and solid waste offices in order to allow EPA and industry to assess the interrelated impacts of all regulations affecting the electric sector. This will ensure maximum co-benefits while avoiding potential unintended consequences (e.g., stranded investments) and without delaying important environmental, public health, and economic benefits. [EPA-HQ-OAR-2009-0491-2718.1, p.10]
Northern Indiana Public Service Company (NIPSCO)
The preamble to the Transport Rule discusses upcoming EPA rules anticipated to affect the power sector in the next two years. EPA states that to the extent it has the legal authority to do so while fulfilling its obligations under the CAA, it will coordinate the utility related air pollution rules with the upcoming regulations for the power sector from EPA's Office of Water and its Office of Resource Conservation and Recovery in efforts to maximize reductions while maintaining cost-effective solutions. NIPSCO wholeheartedly agrees that coordination of rules will assist the power sector with planning and decision making and urges EPA to coordinate the Transport Rule with the replacement for the Clean Air Mercury Rule ('Utility MACT'). We urge EPA to consider the implications from the installation of control devices to meet the Transport Rule requirements on the other rules it mentions in the Transport Rule preamble concerning coordination efforts, specifically the coal combustion residue rule, the cooling water intake structures rule, and the effluent guidelines for wastewater discharges from power plants. The requirements of these rules should be set so the limits are achievable and not overly burdensome to the power sector while providing meaningful environmental benefit. Their provisions should be examined and set in a holistic manner that acknowledges the requirements and consequences of meeting the combined set of EGU rules.  [EPA-HQ-OAR-2009-0491-2747.1 p.2]
In order to coordinate other Utility rulemakings with the Transport Rule, NIPSCO recommends that EPA consider an approach that utilizes the entire Phase I period of the existing Clean Air Interstate Rule ('CAIR') and implements the Transport rule in 2015, the beginning of the CAIR Phase II period. NIPSCO will provide examples in these comments of how this approach improves the overall rule implementation process in a more holistic approach, and specifically addresses coordination with the Utility MACT and new ozone standard that will reportedly be the impetus for Transport Rule II. [EPA-HQ-OAR-2009-0491-2747.1 p.3]
Northwest Indiana Forum
Permitting certainty whereby a regulated facility fully understands the expectations and requirements of an environmental permit from either a state regulatory agency or the U. S. Environmental Protection Agency is critical to our nation's competitive status. As such, when new rules, policies and guidance documents are being proposed it is important that the regulators and the regulated community fully understands the interrelationship between air, water and solid waste permitting implications. The proposed Clean Air Transport Rule (CATR) has interdependency on other environmental rules that needs to be identified and provide clear direction. [EPA-HQ-OAR-2009-0491-3650 p.2]
NRG Energy
However, at the scale of the Transport Rule, it is important to provide an orderly, efficient transition to cleaner generation. It will take time to permit and construct new, cleaner facilities and back-end controls. Coal plants will have to make capital investment or retirement decisions based on the energy markets, the Transport Rule and the future demands of the Hazardous Air Pollutant MACT, 316(b) standards, and Coal Combustion Residue Rule. NRG recommends that EPA carefully consider the comprehensive impacts of the timing and implementation details of all these rules, including a 2015 or later implementation date for the Group 1 SO2 reductions. [EPA-HQ-OAR-2009-0491-2749.1, p. 2]
Ozone Transport Commission (OTC)
We also must point out that Section 110(a)(2)(D)(i)(I) of the Clean Air Act addresses transport "...with respect to any such national primary or secondary ambient air quality standard..." Because the 1997 ozone, 1997 PM2.5 and 2006 PM2.5 NAAQS all had identical primary and secondary standards, this has not previously been a concern. Transport 2, however, will have to account for the W-126 secondary standard under the ozone reconsideration, assuming it is part of the final NAAQS rule. OTC also notes that a transport analysis of the SO2 and NO2 secondary standards, scheduled to be finalized in early 2012, would also be appropriate. [EPA-HQ-OAR-2009-0491-2737.1, p. 19]
As a final point in this discussion, while EPA has committed to updating its interstate transport determinations for future ozone and PM2.5 NAAQS, the OTC feels it important for EPA to also assess transport impacts of SO2 and NO2 in regard to their specific 1-hour NAAQS. Section 110(a)(2)(D)(i) calls on states to prohibit the emission of any air pollutant which will contribute significantly to nonattainment or interfere with maintenance of a standard. The proposed Transport Rule notes that "EPA does not expect peak SO2 levels to be a long-range transport issue" (75 FR 45228) but does not allude to any study that yielded this finding. There is no mention of the recent NO2 NAAQS. A technical review should be completed to determine if any reduction in the SO2 or NOx budget would be required for these recently revised NAAQS. A review of the transport effects of each criteria pollutant upon review of the NAAQS is necessary for the protection of public health in downwind areas.
OTC notes that EPA needs to issue a firm timetable for the issuance of Transport 2 to allow states, industry stakeholders and all affected parties time to develop proper strategies to successfully implement the next rule and have a realistic shot at achieving measurable emissions reductions benchmarks. [EPA-HQ-OAR-2009-0491-2737.1, p. 19]
[[Please note commenter has extensive appendices and visual data attached]]
Public Utilities Commission of Ohio
Another extremely important consideration is the series of rules EPA has already proposed and/or implemented, as well as those it is scheduled to propose and finalize during the same timeframe when the Transport Rule will likely take effect. EPA issued its final "Tailoring Rule" for greenhouse gas emissions in May 2010. Beginning in January 2011, the rule will tailor permitting programs to limit the number of facilities that are required to obtain New Source Review and Title V operating permits based on their greenhouse gas emissions. The threshold will cover power plants, refineries, and other large industrial plants. EPA also issued its proposed rule on Coal Combustion Residuals in June 2010, which will seriously impact many utilities, and ultimately, ratepayers. [EPA-HQ-OAR-2009-0491-2855.1 p.14]
Further, in 2011, EPA is scheduled to propose and finalize a new utility MACT for hazardous air pollutants, as well as new utility new source performance standards (NSPS) for criteria pollutants, even while the 2006 utility NSPS are under reconsideration and subject to pending litigation. EPA is also schedule to issue the proposed Transport Rule for the 2010 reconsidered ozone NAAQS in 2011, with the final rule to be issued in 2012. EPA is additionally considering the substance and timing of its response to the remand of the utility NSPS for greenhouse gases. These are just a few of the EPA proposed regulations and issues that stand to impact utilities and ratepayers. In light of the upcoming changes due to new regulations, as well as changes in historical regulations, such as the replacement of CAIR with the proposed Transport Rule, it has become extremely difficult for companies to plan for compliance with the newest regulations. Achieving compliance has, in fact, become such a moving target that it is virtually impossible to comply with the latest-issued regulation before the next comes along, entirely changing expectations and compliance strategies, and creating stranded investments. We firmly believe that extending the timetable for implementation of the Transport Rule will help to alleviate this regulatory chaos, and allow utilities and regulatory bodies to regain their footing, so to speak, before the next round of proposed regulations is issued. We believe, in fact, that a comprehensive, multi-pollutant approach would be the best type of regulation to use in order to minimize confusion, in the minds of both regulatory bodies, as well as the regulated community, and reduce stranded investments. [EPA-HQ-OAR-2009-0491-2855.1 p.14]
Sierra Club, New Jersey Chapter
As regards the information provided in Section III. Summary of Proposed Rule and Background, and especially the statement that 'This proposed rule is the first of several EPA rules to be issued over the next 2 years that will yield substantial health and environmental benefits for the public through regulation of power plants. Fossil-fuel-fired power plants contribute a large and substantial fraction of the emissions of several key air pollutants'... It is even more reassuring to learn that 'The Administrator in January established improved air quality as an Agency priority and announced plans to promote a cleaner and more efficient power sector and have strong but achievable reduction goals for SO2, NOx, mercury and other air toxics.' [EPA-HQ-OAR-2009-0491-3649, p.1]
In addition to this rule, other anticipated actions include a section 111(d) for electric utilities to be proposed by March 2011, potential rules to address pollution transport under revised NAAQS, revisions to new source performance standards for coal and oil-fired utility electric generating units, and best available retrofit technology (BART) and regional haze program requirements to protect visibility. This too, is a good step forward in providing a healthier environment for the public when visiting many of our National and State Parks throughout the eastern United States. [EPA-HQ-OAR-2009-0491-3649, p.2]
Sierra Club, Pennsylvania Chapter
2. We would welcome and support EPA's intention to promulgate a number of additional rules in the near future to require emission reductions from the power plant sector beyond those in the Transport Rule proposal: [EPA-HQ-OAR-2009-0491-3482.1, p.7]
- address upwind transport with future revisions to the ozone or fine PM NAAQS, including a revised ozone NAAQS later this year and additional rulemakings resolving any needed reductions in transported NOx by 2012;
- Section 112(d) "MACT" standards, to be proposed by March 2011;
- revisions to the new source performance standards (NSPS) for coal and oil-fired power plants (including performance standards for GHG emissions); and
- best available retrofit technology (BART) and regional haze programs to protect visibility. [EPA-HQ-OAR-2009-0491-3482.1, p.8]
South Carolina Department of Health and Environmental Control
The EPA will propose many new important regulations that affect utilities in the next two years, most notably, the Utility MACT and the Tailoring Rule. Because of South Carolina's large SO2 budget, DHEC predicts that these rules (which will restrict, among other things, mercury emissions and greenhouse gases) will likely have more bearing on utilities' decisions on which plants or controls to run than the proposed Transport Rule. Without considering these future rules, the EPA's Transport Rule modeling does not adequately capture the regulatory requirements governing EGU emissions, and may thus lead to flawed results. [EPA-HQ-OAR-2009-0491-2677.1 p.10]
The proposed Transport Rule offers further evidence that the current uncoordinated approach to setting the NAAQS is inefficient. If the EPA issues a new Transport Rule after each revision of the Ozone and PM NAAQS, or perhaps future SO2 NAAQS, budgets will likely change, which hampers long term planning on which the emissions trading program depends. DHEC certainly welcomes the ultimate public health benefits that these new tightened budgets could bring, but revising the Transport Rule according to the unaligned schedules of NAAQS revisions is unnecessarily complex. [EPA-HQ-OAR-2009-0491-2677.1 p.14]