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Released December 07, 2018 | SUGAR LAND
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Written by John Egan for Industrial Info Resources (Sugar Land, Texas)--In a move designed to spur construction of new coal-fired electric generation, the Trump administration on December 6 released a proposed modification of New Source Performance Standards (NSPS) for new, modified and reconstructed fossil-fueled power plants that would remove carbon capture and sequestration (CCS) as the best system of emission reduction (BSER). In its Clean Power Plan, the Obama administration designated partial CCS as the BSER in revising section 111(b) of the Clean Air Act.
The utility industry objected strongly to that designation when the Clean Power Plan was initially released in 2014, and then finalized in 2015, arguing that CCS was an expensive and unproven technology.
The move was leaked to news organizations days before it was officially released. In an interview with The New York Times before the draft regulation was released, Richard J. Lazarus, professor of environmental law at Harvard Law School, said the proposal signals "we're expecting more coal-fired power plants in the future, and we're going to make it easier to get there."
In a statement issued December 6, Environmental Projection Agency (EPA) Acting Administrator Andrew Wheeler said the proposal was consistent with the president's goal of achieving "energy dominance." He said the proposal would "rescind excessive burdens on America's energy providers and level the playing field so that new energy technologies can be a part of America's future." Wheeler, who was a coal-industry lobbyist prior to being named to the EPA, continued, "By replacing onerous regulations with high, yet achievable, standards, we can continue America's historic energy production, keep energy prices affordable, and encourage new investments in cutting-edge technology that can then be exported around the world."
Construction of new coal-fired power plants in the U.S. has been stymied for several years by a combination of abundant and inexpensive natural gas, improving economics for renewable energy technologies, shifting consumer preferences and federal and state regulations that advantage renewable energy and hinder coal-fired power. No developer has announced plans to build a new coal-fired power plant in the next several years. By contrast, several planned coal-fired power plants have been cancelled or placed on hold in recent years.
The EPA proposal would be subject to public comment and could be finalized next year. The agency said CCS's high costs and "limited geographical availability" were the main reasons for proposing the change.
In North America, only two commercial-scale CCS projects have been constructed in recent years: One at the W.A. Parrish Plant near Houston, Texas, and the other at the Boundary Dam Power Station in Estevan, Saskatchewan. Construction costs for the 150-MW Boundary Dam project were estimated at about $1.24 billion, and that project began operating in 2014. For more on that project, see October 30, 2017, article - Conference: CCS, Exports Key for Revival of Western Coal. Following completion of a $1 billion, 610-MW CCS project at the Parish station, power plant owner NRG Energy Incorporated (NYSE:NRG) (Princeton, New Jersey) vowed to never build another CCS project. For more on that, see January 11, 2017, article - NRG Completes World's Largest Carbon-Capture Project and October 7, 2015, article - NRG to Exit Carbon-Capture Business After Texas Project is Completed.
In its December 6 announcement, the EPA said it proposes to determine that "the best system of emission reduction for newly constructed coal-fired units is the most efficient demonstrated steam cycle in combination with best operating practices." This proposed BSER would replace the determination from the 2015 rule, which identified the BSER as partial CCS.
This proposed regulation would permit significantly higher CO2 emission levels for newly constructed coal-fired units depending on their size: Large units would be allowed to emit up to 1,900 pounds of CO2 per megawatt-hour (MWh) on a gross output basis. Small units would be allowed to emit up to 2,000 pounds of CO2 per MWh. The Obama administration's Clean Power Plan reduced allowable emissions of CO2 to about 1,400 pounds per MWh, but that plan was blocked by the U.S. Supreme Court. For more on the Clean Power Plan, see February 16, 2016, article - Unprecedented Stay by Supreme Court Casts Long Shadow Over Clean Power Plan and August 5, 2015, article - Obama Unveils Final Clean Power Plan, But Will it Survive Court Challenge?
On a matter not involving coal-fired power plants, the EPA in its December 6 announcement said it was seeking public comment on "whether and how to address concerns raised by stakeholders regarding the increased use of simple-cycle aeroderivative turbines, including as back-up generation for wind and solar resources, whose operation may exceed the non-base load threshold described in the 2015 (Clean Power Plan)". Any follow-up regulatory actions would be achieved through a separate and subsequent regulatory proposal.
Industrial Info Resources (IIR), with global headquarters in Sugar Land, Texas, six offices in North America and 12 international offices, is the leading provider of global market intelligence specializing in the industrial process, heavy manufacturing and energy markets. Industrial Info's quality-assurance philosophy, the Living Forward Reporting Principle, provides up-to-the-minute intelligence on what's happening now, while constantly keeping track of future opportunities. Follow IIR on: Facebook - Twitter - LinkedIn. For more information on our coverage, send inquiries to info@industrialinfo.com or visit us online at http://www.industrialinfo.com.
The utility industry objected strongly to that designation when the Clean Power Plan was initially released in 2014, and then finalized in 2015, arguing that CCS was an expensive and unproven technology.
The move was leaked to news organizations days before it was officially released. In an interview with The New York Times before the draft regulation was released, Richard J. Lazarus, professor of environmental law at Harvard Law School, said the proposal signals "we're expecting more coal-fired power plants in the future, and we're going to make it easier to get there."
In a statement issued December 6, Environmental Projection Agency (EPA) Acting Administrator Andrew Wheeler said the proposal was consistent with the president's goal of achieving "energy dominance." He said the proposal would "rescind excessive burdens on America's energy providers and level the playing field so that new energy technologies can be a part of America's future." Wheeler, who was a coal-industry lobbyist prior to being named to the EPA, continued, "By replacing onerous regulations with high, yet achievable, standards, we can continue America's historic energy production, keep energy prices affordable, and encourage new investments in cutting-edge technology that can then be exported around the world."
Construction of new coal-fired power plants in the U.S. has been stymied for several years by a combination of abundant and inexpensive natural gas, improving economics for renewable energy technologies, shifting consumer preferences and federal and state regulations that advantage renewable energy and hinder coal-fired power. No developer has announced plans to build a new coal-fired power plant in the next several years. By contrast, several planned coal-fired power plants have been cancelled or placed on hold in recent years.
The EPA proposal would be subject to public comment and could be finalized next year. The agency said CCS's high costs and "limited geographical availability" were the main reasons for proposing the change.
In North America, only two commercial-scale CCS projects have been constructed in recent years: One at the W.A. Parrish Plant near Houston, Texas, and the other at the Boundary Dam Power Station in Estevan, Saskatchewan. Construction costs for the 150-MW Boundary Dam project were estimated at about $1.24 billion, and that project began operating in 2014. For more on that project, see October 30, 2017, article - Conference: CCS, Exports Key for Revival of Western Coal. Following completion of a $1 billion, 610-MW CCS project at the Parish station, power plant owner NRG Energy Incorporated (NYSE:NRG) (Princeton, New Jersey) vowed to never build another CCS project. For more on that, see January 11, 2017, article - NRG Completes World's Largest Carbon-Capture Project and October 7, 2015, article - NRG to Exit Carbon-Capture Business After Texas Project is Completed.
In its December 6 announcement, the EPA said it proposes to determine that "the best system of emission reduction for newly constructed coal-fired units is the most efficient demonstrated steam cycle in combination with best operating practices." This proposed BSER would replace the determination from the 2015 rule, which identified the BSER as partial CCS.
This proposed regulation would permit significantly higher CO2 emission levels for newly constructed coal-fired units depending on their size: Large units would be allowed to emit up to 1,900 pounds of CO2 per megawatt-hour (MWh) on a gross output basis. Small units would be allowed to emit up to 2,000 pounds of CO2 per MWh. The Obama administration's Clean Power Plan reduced allowable emissions of CO2 to about 1,400 pounds per MWh, but that plan was blocked by the U.S. Supreme Court. For more on the Clean Power Plan, see February 16, 2016, article - Unprecedented Stay by Supreme Court Casts Long Shadow Over Clean Power Plan and August 5, 2015, article - Obama Unveils Final Clean Power Plan, But Will it Survive Court Challenge?
On a matter not involving coal-fired power plants, the EPA in its December 6 announcement said it was seeking public comment on "whether and how to address concerns raised by stakeholders regarding the increased use of simple-cycle aeroderivative turbines, including as back-up generation for wind and solar resources, whose operation may exceed the non-base load threshold described in the 2015 (Clean Power Plan)". Any follow-up regulatory actions would be achieved through a separate and subsequent regulatory proposal.
Industrial Info Resources (IIR), with global headquarters in Sugar Land, Texas, six offices in North America and 12 international offices, is the leading provider of global market intelligence specializing in the industrial process, heavy manufacturing and energy markets. Industrial Info's quality-assurance philosophy, the Living Forward Reporting Principle, provides up-to-the-minute intelligence on what's happening now, while constantly keeping track of future opportunities. Follow IIR on: Facebook - Twitter - LinkedIn. For more information on our coverage, send inquiries to info@industrialinfo.com or visit us online at http://www.industrialinfo.com.
