Regulating Mercury from Power Plants

:

A Model Rule for States and Localities

November 2005

State and Territorial Air Pollution Program Administrators (STAPPA)

Association of Local Air Pollution Control Officials (ALAPCO)

444 North Capitol Street, NW, Suite 307, Washington, DC 20001

Telephone: (202) 624-7864; Fax: (202) 624-7863

Web site : www.4cleanair.org

; E-mail: 4cleanair@4cleanair.org

---

About STAPPA and ALAPCO

The State and Territorial Air Pollution Program Administrators (STAPPA) and the

Association of Local Air Pollution Control Officials (ALAPCO) are the two national

associations of air quality officials in the states, territories and major metropolitan areas

throughout the country. The members of STAPPA and ALAPCO have primary

responsibility for implementing our nation's air pollution control laws and regulations

.

The associations serve to encourage the exchange of information and experience

among air pollution control officials ; enhance communication and cooperation among

federal, state and local regulatory agencies ; and facilitate air pollution control activities

that will result in clean, healthful air across the country. STAPPA and ALAPCO share

joint headquarters in Washington, DC

.

For further information, contact STAPPA and ALAPCO at 444 North Capitol

Street, NW, Suite 307, Washington, DC 20001 (telephone: 202-624-7864; fax: 202-624-

7863

;

email

4cleanair@4cleanair.org)

or visit our associations'

web

site

at

www.4cleanair.org

.

---

Acknowledqements

On

behalf of the State and Territorial Air Pollution Program Administrators

(STAPPA) and the Association of Local Air Pollution Control Officials (ALAPCO), we are

pleased to provide

Regulating

Mercury

from

Power Plants: A Model Rule for States and

Localities .

Our associations developed this document in response to concern that the

U.S. Environmental Protection Agency's Clean Air Mercury Rule issued in March 2005

was inconsistent with the requirements of the Clean Air Act and would not result in

adequate reductions in emissions of mercury from coal-fired power plants to protect

public health. This document describes two options for state and local governments

that wish to develop utility mercury rules that are more protective of public health and

the environment than EPA's regulation and contains model rule language for both

.

STAPPA and ALAPCO express gratitude to Richard Ayres, Ayres Law Group,

and Julie Wakefield for their assistance in drafting this document . We also thank John

Paul (Dayton, OH) and Bill O'Sullivan (New Jersey), the associations' mercury leads,

under whose guidance this document was prepared . We also appreciate the efforts of

the STAPPA and ALAPCO model rule workgroup, particularly Sunila Agrawal (New

Jersey), Andy Bodnarik (New Hampshire), Brock Nicholson (North Carolina), Charles

Homer (Montana), Jon Heinrich (Wisconsin), Marlin Gottschalk (Georgia), Praveen

Amar (Northeast States for Coordinated Air Use Management) and Sharon Weber

(Massachusetts). We are grateful for the comments and input provided by other state

and local air pollution control agency representatives, who helped shape the options

presented in this document. Finally, we thank Bill Becker, Executive Director of

STAPPA and ALAPCO, and Mary Sullivan Douglas, Senior Staff Associate of STAPPA

and ALAPCO, who oversaw the project

.

Once again, we believe that

Regulating

Mercury

from

Power Plants: A Model

Rule for States

and

Localities will serve as a useful and important resource for states

and localities as they develop approaches to regulate emissions of mercury from power

plants and thank all of those who contributed to its development

.

Eddie Terrill

John Paul

STAPPA President

ALAPCO President

3

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Table of Contents

4

Executive Summary

6

Chapter 1

: Health and Environmental Effects of Mercury

9

Chapter 2: Routes of Exposure, Emissions and Deposition

14

Chapter 3: History of Federal Regulation of Mercury Under the Clean

Air Act

18

Chapter 4: Status of Mercury Pollution Control Technology

25

Mercury-Specific Control Technologies

26

Multi-Pollutant Technologies

27

"Co-Benefits" from Technologies Designed to Reduce Emissions of

Other Pollutants

28

Mercury Regulation Will Spur Rapid Technological Improvement

29

Chapter 5: Existing State Programs to Control Mercury Emissions

from EGUs

32

Chapter 6: The STAPPA and ALAPCO Model Rule

34

A. Preamble to Model Rule

34

I

.

Architecture of the Model Rule

34

II .

How Would a State Adopt the Model Rule?

35

Ill .

Choosing an Option

35

IV.

Emissions Trading

36

V

.

Applicability

37

VI .

One Standard for All Coals

37

VII. Variances and Exceptions

37

VIII. Monitoring and Record Keeping Requirements

38

---

5

B . STAPPA and ALAPCO Model Mercury Emissions Control Rule

for Coal-Fired Electric Generating Units

39

I

.

Policy Objective

39

II

.

Definitions

39

III

.

Applicability

42

IV .

Requirements

42

V.

Emission Standards

43

A. Emission Standards for New Units

43

B. Emission Standards for Existing Sources : Option I

43

C. Emission Standards for Existing Sources : Option II

44

VI

.

Compliance Determination

46

VII

.

Monitoring

46

VIII

.

Recordkeeping and Reporting

46

IX .

Treatment of EPA Mercury Allowances

47

---

Executive Summary

Regulating Mercury from Power Plants : A Model Rule for States and Localities

(Model Rule) for coal-fired electric generating units (EGUs) is intended to provide state

and local governments the tools needed to obtain reductions in mercury emissions

required to meet the requirements of the Clean Air Act (CAA). The Model Rule would

protect public health using technologies that are available and rapidly entering the

commercial market

.

Mercury emissions from coal-fired electric power generating facilities pose a

serious threat to public health and the environment that requires a swift and effective

response. EGUs account for approximately 48 tons per year, or 43 percent, of mercury

emissions in the United States .

To protect public health and environment, it is

necessary and appropriate to require EGUs to make major reductions in mercury

emissions

.

Since mercury is a hazardous air pollutant (HAP) under the CAA, the Model Rule

treats mercury emissions from EGUs in the same manner as other HAP emissions . That

is, like Section 112(d) 1 of the CAA, the Model Rule requires expeditious application of

state-of-the-art emission control technology to each EGU

.

The U.S. Environmental Protection Agency (EPA) has taken a different and less

effective approach to regulating mercury emissions from coal-fired EGUs

.

EPA has

removed EGUs from its list of HAP source categories that must be regulated under

Section 112 of the CAA.2

Rather than require the use of Maximum Achievable Control

Technology (MACT) for mercury, EPA adopted the Clean Air Mercury Rule (CAMR)

.

The CAMR establishes a nationwide mercury emissions cap set at a level that does not

require until 2018 (13 years from now) any more mercury reductions beyond those that

would result from actions taken to control other pollutants

.3

EPA's rule also provides for

interstate mercury emission trading among EGUs, and allows banking of mercury

"allowances ."

As a result, EPA predicts that the mercury emission cap will not be

achieved until well beyond 2020. The EPA approach was severely criticized by EPA's

own Inspector General, and by the U .S. Government Accountability Office

. 4

STAPPA and ALAPCO criticized the CAMR for providing insufficient protection

for public health and the environment . The CAMR mercury emission cap does not

require application of available mercury emission control technology for EGUs and the

rule delays emission reductions for up to two decades . Further, interstate trading and

banking could result in continuation of existing mercury "hot spots" of exposure near

EGUs that choose to comply using allowances rather than reduce emissions . EPA's

6

---

use of Section 111(d) of the CAA 5 as legal authority for CAMR invites protracted legal

battles that could further delay protection of public health and the environment

.

State and local air pollution control officials supported national regulation of

mercury emissions from EGUs as HAPs, using Section 112 of the CAA. Indeed, local

and state officials, members of STAPPA and ALAPCO, were deeply involved in

discussions with industry and others in an effort to develop recommendations to EPA on

a Section 112 HAP rule when EPA abruptly changed course, removed EGUs from the

list of sources of HAP and abandoned its clear MACT authority under Section 112 of the

CAA. Instead, EPA adopted a cap-and-trade program, claiming legal authority under

Section 111(d) of the CAA- an interpretation of Section 111(d) never before advanced

in its 35-year history. Instead of using its unquestionable authority under Section 112 to

achieve rapid reductions in mercury pollution, the agency gave EGUs an unduly

extended period for compliance with a rule that fails to provide adequate protection for

public health and the environment .

To provide better health protection, state and local agencies may wish to adopt

their own programs to control emissions of mercury, nickel, and other HAPs from EGUs,

which they are free to do

.6

This Model Rule is limited to mercury emissions from coal-

fired EGUs because mercury emissions from these units represent the most serious

danger to public health and the environment. STAPPA and ALAPCO's Model Rule is

intended to provide guidance to state and local agencies that wish to adopt a more

health-protective rule .

Under the Model Rule, all new and modified large EGUs would be required to

install state-of-the-art mercury emission controls when built . All existing EGUs would be

required to install such technology on an expeditious timetable. To give owners and

operators of EGUs flexibility to craft their own compliance plan, the Model Rule includes

two options. Option I requires each owner or operator of EGUs in the state to achieve

an average 80-percent capture of inlet mercury, or meet an alternative output-based

emission standard, across its in-state units by the end of 2008. By the end of 2012,

EGUs would be expected to achieve 90-95 percent capture of inlet mercury, or meet an

alternative output-based mercury emission standard

.

Emissions averaging is not

allowed in Phase 2, although an owner or operator may demonstrate compliance on a

plantwide basis .

Option II allows an owner or operator to bifurcate the compliance process, in

order to accommodate systems that coordinate installation of mercury control

equipment with control technology for sulfur dioxide (SO2), nitrogen oxides (NO„), and

particulate matter (PM)

. In Phase 1, EGUs that constitute one-half of an owner or

operator's generating capacity in the state may postpone compliance with mercury

control requirements until the end of 2012, if the owner or operator makes enforceable

commitments to achieve emissions reductions specified in the Model Rule for SO2, NO,,

PM and mercury. The other half must achieve 90-95 percent capture of inlet mercury, or

an alternative mercury output-based emission standard, by the end of 2008 .

7

---

In the chapters that follow, we present the information a state agency will need in

order to adopt its own mercury emission control requirements for EGUs. Chapters 1

and 2 summarize the current state of knowledge on the health effects and routes of

exposure to mercury emitted from industrial sources, including EGUs

.

Chapter 3

recounts the history of federal efforts to curtail mercury emissions from EGUs . Chapter

4 relates the state-of-the-art in mercury emission control technology . Chapter 5 details

the efforts of the states to date to control mercury emissions from EGUs . Chapter 6

provides a preamble and the text of the Model Rule in regulatory language to make it

easier for states that wish to adopt the STAPPA and ALAPCO approach

.

'42 U.S.C. 7412(d) .

2 70 Fed. Reg. 15994 (March 29, 200 5) .

3 70 Fed. Reg. 28618 (May 18, 2005)

.

" "Additional Analyses of Mercury Emissions Needed Before EPA Finalizes Rules for Coal-Fired

Electric Utilities," Report No. 2005-P-00003, EPA Office of the Inspector General (February 3,

2005) ; "Observations on EPA's Cost-Benefit Analysis of its Mercury Control Options," Report to

Congressional Requesters, GAAO-05-252, U .S. Government Accountability Office (February,

2005)

.

42 U.S.C. 7411(d) .

5

See 40 CFR 60.4101, 70 Fed. Reg. 28657 (May 18, 2005)

.

8

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Chapter 1 : Health and Environmental Effects of Mercury

Exposure to mercury in all its forms can cause health effects in humans and

animals. At high doses, exposure in the womb to the known poison can cause such

severe effects as mental retardation, cerebral palsy, deafness, and blindness

.

While high-dose poisonings are rare in the United States, chronic low-dose

exposure to methylmercury is widespread . EPA found in 2000 that "mercury is both a

public health concern and a concern for the environment ." Nationwide, most human

exposures occur through eating fish and shellfish . In the United States, humans are

most commonly exposed outside the workplace to methylmercury and at low doses,

which can also be toxic in less obvious ways. In recent years, evidence has emerged

implicating increasingly lower doses of methylmercury in adverse human health effects

.

The most well-documented health effects are neurotoxic. Exposures have been linked

to subtle neurodevelopmental effects in children, who are more vulnerable than adults

because their nervous systems are immature and their exposure is higher relative to

body weight .

Children who are exposed to methylmercury before birth as a result of their

mothers' fish consumption may perform poorly on tests designed to measure verbal

learning, vocabulary, attention, and motor functioning . They may also suffer IQ deficits .

The risk of these effects to the general population from methylmercury is low. However,

the Centers for Disease Control and Prevention (CDC) reports that some 6 percent of

women of childbearing age are exposed to levels of methylmercury that may put their

babies at risk for these effects. Moreover, studies reveal that the harmful health effects

tied to methylmercury exposure, such as cognitive impairment, are likely irreversible

.

Extensive data reveal that methylmercury, when ingested in sufficient quantities,

affects the development of the brain as well as the intact nervous system in humans

and animals, particularly in developing fetuses . The developing child can be placed at

risk when the mother is exposed before and after pregnancy because methylmercury

can persist in the body for several months and is found in breast milk . The severity of

effects depends on the timing and concentration of exposure, with certain windows

during fetal development being most critical. In adults, sensory and motor impairment

have also been documented . Other forms of mercury can also impair several organ

systems .

Methylmercury exposure may also produce cardiovascular effects in adults and

children . The strongest association for a link to myocardial infarction, or heart attacks,

has been shown in studies of adult men . This is alarming, given that heart disease

9

---

remains the leading killer of Americans. Methylmercury has also been linked to an

increased risk of blood pressure problems and heart-rate irregularities in exposed

children and adults. Researchers suggest that methylmercury may interfere with the

protective cardiovascular effects of fish oils but a specific mechanism of action is

unknown. Methylmercury also appears to have the potential to affect the immune

system. Although evidence in humans is largely lacking, animal studies suggest that

methylmercury exposure can weaken the immune system function

.

Current data indicate that significant numbers of pregnant women and women of

childbearing age are exposed through their diets to doses of methylmercury that pose

risks to the fetus. Three large studies have examined the adverse neurological effects of

methylmercury exposure. Two of these studies, in the Faroe Islands and New Zealand,

found that

in utero

exposures produced later neurobehavioral deficits in development,

attention, fine motor function, language, visual-spatial abilities, and memory. A third

study in the Seychelles Islands found no association . But the results in New Zealand

and the Faroe Islands are consistent with a broad body of research on the neurotoxic

effects of methylmercury. More recent studies in exposed Amazonian villagers and

Cree Indians

in

Northern Quebec

also

demonstrated reduced function on

neuropsychological tests. Thus the weight of evidence indicates an adverse health

association

.

A general agreement has emerged in the scientific community supporting the

potential for moderate levels of methylmercury exposure to result in adverse health

effects. The National Research Council (NRC), an arm of the National Academy of

Sciences, recommended in 2000 that the findings from the Faroe Islands study be used

by the EPA to set its risk-based guideline for low-dose chronic exposure . In addition,

NRC found that the magnitude of exposure reported in such studies was sufficient to be

linked with increases in poor classroom performance, perhaps even requiring remedial

or special education classes .

EPA, among other national and international health organizations, and consistent

with the recommendations of the NRC, has set a daily consumption standard of 0 .1

micrograms of methylmercury per kilogram body weight per day. However, there is no

evidence of a safe level given that heath effects have been demonstrated at exposures

below the reference dose. In the United States, mercury contamination is so pervasive

in the environment that at least 45 state health departments have issued fish

consumption advisories. Experts agree that the only real remedy is to make the fish

safer to eat

.

The U.S. Food and Drug Administration (FDA) has also recommended that

expectant and nursing mothers and young children avoid swordfish, tilefish, shark and

king mackeral, and limit consumption of fish that are lower in mercury, such as shrimp,

salmon, and canned tuna, to two average-sized meals or to 12 ounces a week at most

.

FDA also recommends consulting local fish advisories before consuming fresh-water

fish. The risks posed by elevated levels of mercury in fish pose an additional public

health problem because fish contain beneficial nutrients that are not easily obtained

10

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elsewhere

.

Interestingly,

researchers suggest that the statistical correlation between

methylmercury and heart disease may be attributed to the compound's interference with

the beneficial fatty acids found in varying levels in assorted fish . Yet mercury's

contribution to heart disease may be related to other undiscovered toxic mechanisms as

well

.

In the 1999-2000 and 2001-2002 National Health and Nutrition Examination

Survey (NHANES), the CDC sampled body burdens and found that almost 6 percent of

women tested above the EPA threshold. Mercury ingested by a woman is then

concentrated for her unborn baby .

Several recent studies have compared mercury

concentrations in umbilical cord blood and maternal blood and have shown that cord

blood on average has 70 percent higher mercury concentrations . Based on these

studies, about 410,000 babies born each year - 10 percent of the national total - have

been exposed

in utero to mercury levels that exceed EPA's reference dose

.

The

exposures are not uniform across the population, since fresh-water fish are consumed

disproportionately in the families of sports anglers, certain ethnic groups, and

subsistence fishers

.

Studies of the environmental effects of mercury have focused almost exclusively

on wildlife impacts. Although the studies do not generally signal the decline of entire

species, they do illustrate the adverse impact on wildlife of mercury contamination in

different regions of the United States. For example, loon chick production in Wisconsin

has shown a decline on lakes where the methylmercury content of chick blood was

elevated

.

There is also evidence of reduced survivorship in otters in areas where

mercury deposition levels are high. Meanwhile, an increasing amount of evidence

indicates methylmercury affects behavioral patterns in fish populations

.

References :

Agency for Toxic Substances and Disease Registry . Q's and A's for release of ATSDR's

Toxicological Profile on Mercury to Supplement Information in the Key Communication

Points

. April 19, 1999. USFDA Center for Food Safety and Applied Nutrition . Online .

Available : www.cfsan .fda.gov/-acrobat/hgstudl7.pdf.

Brown, D. and M. Tatsutani . Northeast States and Eastern Canadian Provinces Mercury

Study: A Framework for Action . Chapter III: Health Effects of Mercury and Strategies to

Protect Public Health. February 1998 .

Burge, P. and S. Evans. "Mercury Contamination in Arkansas Game Fish : a Public

Health Perspective ." J Ark Med Soc . Vol. 90, No. 11 (April 1994): 542-544 .

Committee on the Toxicological Effects of Methylmercury. Board on Environmental

Studies and Toxicology. Commission on Life Sciences . National Research Council

.

Toxicological

Effects

of Methylmercurv,

2000. National Academy Press. Online

.

Available

: www.nap.edu/books/0309071402/html/.

1 1

---

Evers, D., J. Kaplan, M. Meyer, P. Reaman, W. E. Braselton, A. Major, N. Burgess and

A.M. Scheuhammer. "Geographic Trend

in Mercury Measured in Common

Loon

Feathers and Blood ."

Environmental

Toxicology and Chemistry

Vol. 17 Number

2(1998): 173-183

.

Facemire, C .F. "Mercury in Wildlife," in U .S. EPA, National Forum on Mercury in Fish

:

Proceedings

. 1995. (EPA 823-RR-95-002)

.

FAO/WHO, 2003

: Summary and conclusions of the sixty-first meeting of theJoint

FAO/WHO Expert Committee on Food Additives (JECFA)

. Rome, 10-19 June 2003

.

(JECFA/61/SC) Online. Available : f

tp://ftp.fao.org/es/esn/jecfa/jecfa6lsc .pdf.

Hightower, J . "Mercury Levels in High-End Consumers of Fish." Environmental Health

Perspectives

. November 1, 2002 . Online. Available: Ehponline.org

.

Krabbenhoft, D.P., and J.G. Weiner, "Mercury Contamination: A Nationwide Threat to

Our Aquatic Resources, and a Proposed Research Agenda for the U.S. Geological

Survey," in Morganwalp, D.W ., and Buxton, H.T., eds ., U.S. Geological Survey Toxic

Substances Hydrology Program--Proceedings of the technical

meeting, Charleston,

S.C., March 8-12, 1999: U.S. Geological Survey Water Resources Investigation Report

99-4018B

.

Lathrop, R .C. et al

. Mercury Levels in Walleyes from Wisconsin Lakes of Different

Water and Sediment Chemistry Characteristics .

Wisconsin Department of Natural

Resources, Technical Bulletin No. 163. 1989 .

Mahaffey, Kathryn. "Methylmercury: Epidemiology Update," presentation at the Fish

Forum, San Diego, 2004. Available at

www.epa.gov/waterscience/fish/forum/2004/presentations/Monday/mahaffey .pdf.

"Meeting the Challenges of Continental Pollutant Pathways Mercury Case Study

."

Final

Report to the Secretariat of the CEC . February 1999. Online . Available : www.eman-

rese.ca/eman/reports/publications/9 9 mercurywkshp/page3.html .

Meyer, M ., D . Evers, J. Hartigan and P. Rasmussen. "Patterns of Common Loon

(Gavia

Immer)

Mercury

Exposure, Reproduction,

and

Survival

in

Wisconsin,

USA."

Environmental Toxicoloqv and Chemistry Volume 17 Number 2 (1998): 184-190 .

Mierle, G., E. Addison, K.S. MacDonald and D .G. Joachim. "Mercury Levels in Tissues

of Otters from Ontario, Canada : Variation with Age, Sex and Location

." Environmental

Toxicologv and Chemistry Volume 19 Number 12 (2000) : 3044-3051 .

Schober, S .E . et al. "Blood Mercury Levels on US Children and Women of Childbearing

Age, 1999-2000." 2003 . JAMA Vol. 289, No 13 (April 2, 2003) : 1667-1674 .

12

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Scheuhammer, A. M., "Effects of Acidification on the Availability of Toxic Metals and

Calcium to Wild Birds and Mammals ." Environmental Pollution 17 (1991): 329-375

.

Scheuhammer, A. M. "Methylmercury Exposure and Effects in Piscivorous Birds," in

Proceedinqs 1995 Canadian Mercury Network Workshop

. York University, Toronto,

Ontario, 1995

.

Schreiber, R. K. and J. Newman. "Effects of Air Pollution on Wildlife : A Synthesis," in

Proceedings

XIX

World

Congress,

International

Union

of

Forest

Research

Organizations

. 1990. 180-191

.

Stern, A.H ., M. Gochfeld, C. Weisel and J . Berger. "Mercury and Methylmercury

Exposure in the New Jersey Pregnant Population

." Arch .

Environ .

Health

Vol. 56

(Jan/Feb.2001): 4-10 .

U.S. EPA. 44 Fed. Reg. 3990 (January 19, 1979)

.

U.S. EPA . An Ecological Assessment for Anthropogenic Mercury Emissions in the

United States . Volume VI of Mercury Study Report to Congress

. December 1997. (EPA-

452/R-97-008) .

U.S. EPA . Characterization of Human Health and Wildlife Risks from Mercury Exposure

in the United States

. Volume VII ofMercury Study Report to Congress

. December 1997 .

(EPA-452/R-97-009)

.

U.S. EPA . Health Effects of Mercury and Mercury Compounds

. Volume V of Mercury

Study Report to Congress

. December 1997, (EPA-452/R-97-007)

.

U.S. EPA. Integrated Risk Information System

. www.epa.gov/iris .

U.S. EPA. "Regulatory Finding on the Emissions of Hazardous Air Pollutants from

Electric Utility Steam Generating Units," 65 Fed Reg . 79825, 79830 (December 20,

2000) .

Wisconsin Department of Natural Resources

. Mercury in Wisconsin's Environment. A

Status Report

. 1996

.

1 3

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Chapter 2: Routes of Exposure, Emissions, and Deposition

Anthropogenic emissions of mercury to the air in the United States totaled 115

tons in 1999. Coal-fired electricity generating plants are the largest contributor to this

amount, accounting for 43 percent, or 48 tons, of known U .S. anthropogenic air

emissions, according to EPA's best available estimates . None of the coal-fired power

plants in the United States is currently operating with permanently-installed mercury-

specific emissions control equipment. These plants collectively remain the largest

uncontrolled source of mercury pollution nationally

.

Considerable reductions in mercury emissions were achieved during the 1990s

by effective national regulation and control of mercury emissions from medical waste

incinerators and municipal waste combustors . Likewise, effective regulation of coal-fired

power plants for this hazardous air pollutant will reduce mercury emissions and

deposition to surface waters. But the current contribution of EGUs remains high and will

increase as new coal-fired EGUs are built

.

In some areas of the country, mercury emissions from coal-fired power plants

may account for as much as 80 percent of the mercury deposited, according to recent

studies by the Electric Power Research Institute (EPRI) . According to EPRI, the portion

of mercury deposition from coal-fired plants ranges from 10 to 80 percent depending on

the region. EPA's own modeling shows that in many areas of the country where there

are coal-fired power plants, those plants account for more than half of mercury

deposition

.

After mercury is deposited from the atmosphere, it becomes bioavailable through

reactions occurring in the aquatic ecosystem. Mercury can be converted by bacteria in

the sediments to methylmercury, a form that is toxic to humans and wildlife . Smaller

organisms pick up the methylmercury and fish become contaminated as they feed on

other organisms. As larger fish eat smaller ones, methylmercury concentrations

increase in the bigger fish, a process known as bioaccumulation . Consequently, larger

predator fish usually have higher concentrations of methylmercury from eating

contaminated prey. Those at the top of the food chain, such as humans, birds and other

wildlife that eat fish, are exposed to the highest levels of methylmercury in this way

.

Modeling deposition patterns for mercury is similar to modeling deposition of

other pollutants, but it is complicated by the fact that power plants emit mercury in three

forms, each of which has a different fate in the atmosphere . Gaseous elemental

mercury may move long distances with air masses and resides in the atmosphere

usually until it oxidizes, which can take up to a year . The reactive and particulate-bound

forms of mercury - oxidized mercury and mercury adsorbed to particles - stay in the

14

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atmosphere for a few days and are usually deposited within 50 to 100 miles of a source

by wet or dry deposition .

The type of air pollution control devices in place and the type of coal burned can

also affect the quantity and species of mercury emitted . For example, installing a

selective catalytic reduction (SCR) system to control emissions of NO, at a unit that

does not have an SO2 scrubber or Activated Carbon Injection (ACI) can increase

emissions of the reactive oxidized species of mercury

.

Other major anthropogenic sources of mercury emissions were regulated by EPA

through MACT standards EPA adopted under its Section 112 HAP-control authority in

the 1990s. Mercury emissions from medical waste incinerators and municipal waste

combustors have decreased by more than 90 percent since 1990 . This dramatic

reduction is attributed to the installation of mercury emissions control equipment on new

and existing incinerators as well as closures of small, inefficient units and declining use

of mercury in products and industrial production .

The declining use of mercury in consumer products, such as paint, paper, and

batteries, has also contributed to lessened emissions from municipal waste combustors

.

Both the use and disposal of mercury in these products are coming under increasing

state and local regulation . More than 19 states have passed legislation concerning the

use, sale or labeling of mercury-containing products

.

Field studies show a direct relationship between mercury deposition and mercury

levels in fish. The findings indicate that reducing domestic emissions of reactive

mercury compounds can lower mercury concentrations in fish in the United States,

regardless of distribution of contributions from natural and foreign sources . Changes in

atmospheric mercury deposition can rapidly affect concentrations in fish, according to a

2002 study by Wisconsin researchers . The research team found a 10-percent decrease

in deposition corresponded with a 5-percent decrease in mercury levels in fish tissue

.

The findings are similar to those of a South Florida study, published in 2001, that

tracked the link between reductions in mercury deposition and corresponding decreases

in mercury levels in water and fish tissue over a multi-year period . In another ongoing

study being conducted by an international team of scientists in a lake area of northern

Ontario, mercury isotopes that were added to the lake have been found in fish living in

the lake within a few months. On the basis of these studies, researchers suggest that

the amount of mercury added to an ecosystem from new sources, rather than that

already trapped in sediment, is the main determinant of how much mercury is

introduced into the food chain . These and other developing studies demonstrate the

efficacy of reducing current emissions of mercury in reducing concentrations of mercury

in fish and other animals .

Substantial reduction in U.S. power sector mercury emissions will not be

sufficient by itself to solve the entire mercury contamination problem . Other large

sources need to be controlled and several have been . But since coal-fired power plant

emissions are the largest remaining source of mercury emissions, regulating this

15

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industry is the most effective way to mitigate the existing threat to human health and the

environment presented by mercury emissions . Regulation and concomitant reduction of

mercury emissions will reduce the mercury contamination of fish in this country and

reduce the resulting adverse health impacts . Also, it will allow the U.S. to take more of

a leadership role internationally than it has to date

.

References :

Hrabik, T.R. and C.J. Watras. "Recent Declines in Mercury Concentration in a

Freshwater Fishery: Isolating the Effects of De-acidification and Decreased Atmospheric

Mercury Deposition in Little Rock Lake ." The Science of the Total Environment . 2002. In

press

.

Lamborg, C . H., W. F. Fitzgerald, J. O'Donnell, and T. Torgersen. "A non-steady-state

compartmental model of global-scale mercury biogeochemistry with interhemispheric

atmospheric gradients ." Geochimica et Cosmochimica Acta Volume 66 Issue 7 (2002) :

1105-1118 .

Lutter, R. and E. Irwin "Mercury in the Environment: a Volatile Problem ." Environment

.

November 2002

.

Pirrone, N., P. Costa, J.M. Pacyna and R. Ferrara. "Atmospheric Mercury Emissions

from Anthropogenic and Natural Sources in the Mediterranean Region ." Atmospheric

Environment 35 (2001): 2997-3006 .

Reindl, J., Recycling Manager Dane County, WI Department of Public Works . "Status of

Local, State and Federal Mercury Product Legislation and Laws . 2001-2002 Legislative

Sessions." October 11, 2002

.

Seigneur, C . et al

. Modelinq the Atmospheric Fate and Transport of Mercury Over North

America

. Atmospheric and Environmental Research, Inc . Undated .

Travnikov, O. and A. Ryaboshapko . (2002): Modeling of mercury hemispheric transport

and depositions .

EMEP/MSC-E Technical Report

6/2002, Meteorological Synthesizing

Centre

- East, Moscow, Russia as

cited

in UNEP, Chemicals

Global

Mercury

Assessment, 2002 . Geneva, Switzerland: Inter-Organization Programme for the Sound

Management of Chemicals (IOMC), 2002

.

UNEP .

Chemicals .

Global

Mercury

Assessment .

Geneva, Switzerland

:

Inter-

Organization Programme for the Sound Management of Chemicals (IOMC), 2002

.

U.S. EPA. An Inventory of Anthropogenic Mercury Emissions in the United States

Volume II of Mercury Studv Report to Conqress

. 1997 (EPA-452/R-97-004)

.

16

---

U.S

.

EPA, Office of Air Quality Planning and Standards. 1999 National Emissions

Inventory for Hazardous Air Pollutants

.

www.epa.gov/ttn/chief/neU1999inventory .htm

l#final3haps .

U.S. EPA. South Florida Ecosystem Assessment: Phase I/II- Everglades Stressor

System Interactions

:

Hvdropatterns,

Eutrophication,

Habitat Alteration and Mercury

Contamination

. September 2001 (EPA 904-R-01-002)

.

U.S. EPA. www.epa.gov/mercury/contro

l emissions/emissions.htm

.

17

---

Chapter 3 : History of Federal Regulation of Mercury Under

the Clean Air Act

Since 1970, the Clean Air Act has provided for federal regulation of emissions of

HAPs. In 1970 Congress mandated EPA to adopt HAP standards that would "protect

public health with an ample margin of safety." Health-based standards for HAPs proved

hard to adopt, and by 1990 EPA had managed to establish standards for only seven

categories of HAP-emitting sources

.

In response to this failure, Congress drastically revised the HAPs program in

1990 .

The new program sought to avoid cumbersome health-related investigations

.

Instead, it mandated that EPA establish technology-based emission limitations for

sources of HAPs .

Congress listed more than 180 HAPs, 1

including mercury, and

ordered EPA to write "Maximum Achievable Control Technology" (MACT)

2

standards

for industrial sources of these pollutants on a prescribed statutory timetable

. 3

One source category of industrial HAPs received special treatment in the 1990

CAA Amendments - "electric utility steam generating units ." Rather than imposing

MACT standards immediately, EPA was directed to perform a study of HAP emissions

from EGUs, and to report to Congress, not later than November 15, 1994, on the

hazards to public health resulting from EGU emissions." EPA was to regulate HAP

emissions from EGUs under Section 112 of the CAA if, based on the results of the EPA

study, the Administrator determined that regulation was "appropriate and necessary

."5

EPA's response to Congressional direction on EGU HAPs was less than prompt

.

In July 1995, EPA made available for peer and public review a "draft" of the Report to

Congress on HAPs from EGUs

. 6

But the Final Report was not transmitted to Congress

until February 1998

.7

The Final Report deferred making a determination whether

"regulations to control HAP emissions from EGUs are appropriate and necessary

."8 But

the Report concluded that mercury was the HAP of greatest concern, and that "available

information, on balance, indicates that utility mercury emissions are of sufficient

potential concern for public health to merit further research and monitoring

."9

Two years later, after a large information-collection effort concerning the

magnitude and nature of mercury emissions from power plants, EPA issued a regulatory

finding that "regulation of HAP emissions from coal- and oil-fired electric utility steam

generating units under section 112 of the CAA is appropriate and necessary," and

added these units to the list of source categories of HAPs under Section 112(c) of the

CAA subject to MACT standards

. 10

1 8

---

EPA based its finding on the Report to Congress and information subsequently

obtained, which provided the following reasons for regulation of mercury emissions from

EGUs :

•

Mercury is "highly toxic, persistent, and bioaccumulates in the food chain

.""

•

Dietary methylmercury is a neurotoxin that is absorbed in the blood and

distributed to all the tissues, including the brain

.

12

•

The developing fetus is considered most sensitive to the effects of

methylmercury, with studies suggesting that low exposures

in utero "have

resulted in delays and deficits in learning abilities

.03

•

About 7 percent of women of childbearing age are exposed to methylmercury

at levels exceeding the Reference Dose, and about 1 percent has exposures

3-4 times that level

.

14

•

Exposure to methylmercury "can have serious effects on wildlife as well as

humans ."15

•

EGUs are the largest source of mercury emissions in the U .S . 16

•

As a result, emissions from EGUs "are a threat to public health and the

environment.""

•

It is possible to control mercury emissions from EGUs .

Regulation of HAP emissions from EGUs is thus "appropriate," EPA concluded,

because :

"electric utility steam generating units are the largest domestic source of mercury

emissions, and mercury in the environment presents significant hazards to public

health and the environment ."'8

Regulation is "necessary" because

:

"implementation of other requirements under the CAA will not adequately

address the serious public health and environmental hazards arising from such

emissions identified in the Report to Congress and confirmed by the National

Academy of Sciences study, and which section 112 is intended to address ." 19

STAPPA and ALAPCO representatives were involved in a formal, one-and-a-half

year stakeholder process that EPA sponsored under the Federal Advisory Committee

Act (FACA) to advise the agency on the utility MACT . The workgroup consisted of

federal, state and local officials and representatives of industry and environmental

organizations, who met 14 times over an 18-month period and thoroughly analyzed the

issues related to the regulation of hazardous air pollution from utilities .

In the FACA process, state and local agency representatives reiterated the need

for a mercury control program from EGUs that incorporates the following principles

:

•

The most stringent control of mercury emissions technically achievable

;

•

No trading of toxics

;

19

---

•

Minimal subcategorization among coals or types of EGUs

;

•

A multi-pollutant approach ;

•

Enhanced ability for States to implement the standards ; and

•

Early compliance encouraged through the use of incentives

.

These principles were articulated in letters to EPA, in meetings with EPA, in

discussions within the Utility MACT Workgroup, in testimony before Congress, in

testimony before the agency and in resolutions adopted by STAPPA and ALAPCO

.

In April 2004, EPA abruptly terminated the FACA group and reversed its

regulatory course, ignoring the advice of the FACA stakeholder committee

.

In two

Federal Register

announcements that showed evidence of excessive reliance on

industry input, EPA proposed: (1) to revise its 2000 regulatory finding to remove coal-

and oil-fired electric EGUs from the list of HAP emitters under Section 112(c) of the

CAA, and, (2) to adopt a cap-and-trade program, described as a "standard of

performance" under Section 111(d) of the CAA, instead of adopting MACT standards

under Section 112 of the CAA .20

Questioning the health-effects studies relied upon in

EPA's earlier regulatory finding '21 EPA advanced an entirely new interpretation of the

"appropriate and necessary" language in the CAA

. 22

Even if regulation were

"appropriate," under the proposed new interpretation, it would not be "necessary" unless

EPA determined that "the other authorities of the CAA,

once implemented,

would not

adequately address those HAP emissions from "Utility Units" that warrant regulation

.

'23

Where previously the agency had said it would consider HAP reductions from other

regulations that were already in place when it decided whether a MACT standard was

"necessary," under this wholly novel interpretation the agency could not regulate a HAP

from an EGU unless it could show that there was no program that

could be adopted

under the Clean Air Act to curtail the toxic emissions

.

The legal theory advanced in support of EPA's proposed cap-and-trade program

was particularly problematical . No category of sources ever classified as HAP emitters

has ever before been subsequently delisted and regulated under the agency's Section

111(d) authority. Moreover, in nearly 35 years of interpreting Section 111, EPA has

never advanced the theory that the statutory term "standard of performance" could be

interpreted to include a cap-and-trade program . Indeed, two statutory definitions24

make clear that "standard of performance" refers to a standard to require specific

facilities to install emission control technology to achieve a specified level of emission

control

.

The agency admitted that its cap-and-trade "standard of performance" "may not

eliminate the risk of unacceptable adverse health effects of Hg emissions ."25

EPA

stated its intention to adopt a "near term cap" in 2010 that could be met without

installation of any mercury-specific controls, to be attained simply from emission

reductions that will incidentally occur from projected installation of control equipment for

other pollutants under other CAA programs . Analysis suggests, the agency said then,

that these incidental reductions will reduce annual emissions from EGUs to

approximately 34 tons. Beginning in 2018, EPA proposed to impose a national cap on

20

---

total Utility Unit emissions of mercury of 15 tons .26

Since emitters would be allowed to

"bank" mercury emission credits, total national emissions would exceed 15 tons per

year for some time beyond 2018

.27

Moreover, there was no assurance that the 15-ton

cap would ever be reached because the agency proposed a "safety valve" that would

require EPA to borrow from the next year's mercury allowances to increase current year

mercury emissions if the price of allowances ever reached $2,187.50

.26

EPA rationalized such a lax proposal on the grounds that "Currently, there are no

commercially available control technologies specifically designed for reducing Hg

emissions .' 2

This rationale is vulnerable on two grounds. First, a mercury-specific

control technology, ACI, is operating on dozens of large municipal waste combustors

and medical waste combustors across the country. ACI is today being offered by

vendors for use on EGUs (see Chapter 4, below) . Second, under the Clean Air Act,

EPA has been directed to use its regulatory powers to stimulate commercialization of

technologies to protect public health. This mandate has been endorsed repeatedly by

reviewing courts over the past 30 years .

30

In a supplemental notice of proposed rulemaking, the agency took a more

optimistic view of ACI, stating that "deployment could occur on a large scale after 2010"

and that "large scale operation of the technology is feasible by 2013 and 2015 ."31

No

change was proposed, however, in the compliance dates of 2010/2018 that EPA had

proposed earlier.

EPA received over 500,000 comments - the largest number ever received by the

agency on a proposed regulation - overwhelmingly critical of the agency's proposal

.

STAPPA and ALAPCO's comments noted that EPA had completely disregarded the

stakeholder group's deliberations . For example, neither EPA nor the industry

participants ever suggested using Section 111 as legal authority for mercury control

regulations. Further, the FACA workgroup had acknowledged that Section 112 did not

allow for a mercury emission-trading program among utilities . Notwithstanding the

recommendations of the FACA workgroup, EPA had failed to analyze more stringent

control options to reduce mercury emissions. Indeed, the comments noted that EPA's

proposal was more lenient than positions agreed to by electric power industry

representatives on the FACA committee

.

In December 2004, citing the large number of comments and new information

relevant to the "two primary regulatory approaches" it had proposed, as well as to the

agency's benefits calculation methodology, EPA reopened the comment period . Noting

that "we have become aware of new information on the ability of sorbent injection

technologies [ACI] to remove Hg emissions," the agency asked whether it would be

"appropriate for an economic forecast to assume an improvement in costs over time?"

32

About four months later, EPA issued a final rule declaring "in error" its 2000

finding that regulation of utility mercury emissions was "appropriate and necessary"

under CAA Section 112, 33 and removing coal- and oil-fired EGUs from the Section

2 1

---

112(c) source category list for regulation

.

In the final regulation, EPA stated its new

interpretation of the statutory phrase "appropriate and necessary" even more baldly

:

[W]e interpret the term "necessary" in section 112(n)(1)(A) to mean that it is

necessary to regulate Utility Units under section 112 only if there are no other

authorities available under the CAA

that would, if implemented, effectively

address the remaining HAP emissions from Utility Units

. 34

Contrary to the original proposal, in this final rule the agency maintained that

once the Clean Air Interstate Rule (CAIR) rule, and its mercury cap-and-trade rule

(CAMR) were implemented, there would be no "unacceptable hazards to public health"

from mercury emitted by coal-fired EGUs

.35 The agency admitted that this was a

probability statement rather than a regulatory assurance

. 36

In May 2005, EPA promulgated a model emission cap-and-trade program, and

state-by-state mercury emission budgets .37 The budgets are applicable whether or not a

state chooses to adopt the EPA cap-and-trade program

.38

The Phase I national cap is

set at 38 tons, while the Phase II cap is 15 tons . Because of banking and trading, EPA

projects that even by 2020, emissions will still be 24 .3 tons, reduced only 50 percent

from a 1999 baseline

.39

States are not required to use the EPA cap-and-trade program

or any other cap-and-trade program, but each state must submit a "State Plan" to

achieve the statewide mercury emissions budget provided in the EPA rule . States that

do not participate in the cap-and-trade system must demonstrate that their program will

require as much as the CAMR

.40

But they are free to address the problem of mercury

emissions from EGUs through alternative approaches, such as the facility-specific

emission limitations without trading suggested in this Model Rule

.

At the same time, EPA promulgated a final rule establishing NSPS standards for

mercury emissions from new and modified EGUs

.41

This rule, a complement to the cap-

and-trade system, established separate output-based standards, applicable to any new

or reconstructed unit for which construction commenced after January 30, 2004

. 42

Fourteen states filed a Petition for Reconsideration with EPA, asking that the

agency stay the effectiveness of the agency's final rule removing coal- and oil fired units

from the Section 112(c) list of sources of toxic emissions and convene a proceeding for

reconsideration of the CAMR .43

A similar petition was filed by a coalition of

environmental organizations and Native American jurisdictions

.44

On June 24, 2005,

the EPA Assistant Administrator for Air and Radiation refused to stay the CAMR

.45 On

October 28, 2005, EPA reopened comment for an additional 45 days on certain specific

points, among them the legal basis for the CAMR, the public health effects of mercury

pollution, and the work the agency used to assess mercury levels in fish tissue

.

An attempt to nullify the EPA rule by Congressional action failed on September

13, 2005, when the Senate rejected a resolution under the Congressional Review Act

.

By a narrow 51-47 vote, the Senate defeated S .J. Res. 20, sponsored by a number of

Senators, which would have overturned EPA's decision to use Section 111 of the CAA

22

---

as authority for a cap-and-trade program for mercury

.

Instead, it would have required

MACT standards be adopted under Section 112(d) of the CAA

.

4

CAA Section 112 (n)(1)(A), 74 USC 7412 (n)(1)(A)

.

Congress also directed the Administrator

to conduct a study of mercury emissions from EGUs, municipal waste combustors, and other

sources to determine emissions, health and environmental effects, and the availability and cost

of control technologies. CAA Section 112(n)(1)(B), 42 USC 7412(n)(1)(B), cited in Chapters 2 &

3. Congress also mandated a study by the National Institute of Environmental Health Sciences

by November 15, 1993, to determine a threshold of mercury exposure below which "human

health effects are not expected to occur." CAA Section 112 (n)(1)(C), 42 USC 7411 (n) (1)(C) .

5 CAA Section 112 (n)(1)(A), 42 USC 7412 (n)(1)(A)

.

6 60 Fed. Reg. 35393 (July 7, 1995) .

7 EPA, "Study of Hazardous Air Pollutant Emissions from Electric Utility Steam Generating

Units: Final Report to Congress" (February, 1998)

.

6

Id. at ES-1 .

9

Id. at ES-18 .

10 65 Fed. Reg. 79825 (Dec. 20, 2000)

.

" Id . at 79829

.

12

Id .

13

Id .

14 Id . at 79830. Subsequently EPA has concluded that the number exposed in excess of the

Reference Dose is 5.8 percent, rather than 7 percent as stated in the Report to Congress

.

15

Id.

16 Id. at 79827

.

17 Id.

18 Id. at 79830

.

19 Id.

20 69 Fed. Reg. 4652 and 4661 (Jan. 30, 2004); 69 Fed. Reg. 12398 (March 16, 2004) .

21 69 Fed. Reg. at 4658 (Jan. 30, 2004)

.

22

CAA Section 112 (n)(1)(A), 42 USC 7412 (n)(1)(A)

.

23 69 Fed. Reg. at 4684 (Jan. 30, 2004) (emphasis added)

.

24

CAA Section 11 1(a)(1), 42 USC 741 1(a)(1) and Section 302(1), 42 USC 7602(I)

.

25

69 Fed.Reg. at 4686/3 (Jan . 30, 2004)

.

26

Id. at 4698 .

27 69 Fed Reg. 12411 (March 16, 2004) .

"Because of the banking of excess emission

reductions in the first phase of the Hg program, emissions in the second phase will be initially

higher than the caps that are required under CAMR ." 70 Fed . Reg. 16018 (March 29, 2005)

.

26

Id . at 12414

.

29 69 Fed. Reg. at 4691 (Jan . 30, 2004). The agency brushed aside the evidence that ACI

technology had achieved 90-percent reduction in mercury emissions from incinerators on a

commercial basis, citing "important technical differences between Utility Units and municipal

waste combustors

.

.

. ." Id . at 4674 .

30

See, for example, International

Harvester Co. v. Ruckelshaus,

478 F.2d 615, 629 (D.C

. Cir.

1973) ;

Natural

Resources

Defense

Council

v.

Thomas,

805

F.2d 410,

429

(D.C .

Cir. 1986)

; Portland

Cement Assn

v.Ruckelshaus, 486 F.2d 375, 391 (D.C . Cir. 1973) ;

Natural

Resources Defense Council

v .

EPA, 655 F.2d 318, 328 (D.C . Cir. 1981) (EPA "expected to

23

' CAA Section 112 (b), 74 US C 7412 (b)

.

2 CAA Section 112 (d), 74 USC 7412 (d)

.

3

CAA Section 112 (e), 74 USC 7412 (e) .

---

press for the development and application of improved technology rather than be limited by that

which exists today")

;

Wisconsin

Electric Power Co.

v.

Reilly,

893 F.2d 901, 909-10 (7

1'

Cir.1990)

;

Husgvarna v. EPA,

254 F.3d 195 (D.C . Cir. 2001) ("Congress intended the agency to

?roject future advances in pollution control capability

.")

69 Fed. Reg at 12403/2 (March 16, 2004)

.

32

69 Fed. Reg. 69870 (December 1, 2004)

.

33

70 Fed. Reg. 15994, 16005 (March 29, 2005)

.

34

Id .

at 16001/2 (emphasis added) .

35

Id.

at 16024/3 "Risks Remaining After Implementation of CAIR, and Even More So After

CAMR, Are Acceptable."

36

See

Id.

at 16024 ff.

37 New 40 CFR 60.4140, 70 Fed. Reg. 28665. The model emission trading program dropped

the safety valve mechanism of the original proposal

.

Id .

at 28630/2 .

38

Id .

at 28624/2

.

39

Id .

at 28619/3

.

40

Id.

at 28632/1

.

4'

70 Fed. Reg. 28606 (May 18, 2005)

.

42

New 40 CFR 60.45a, 70 Fed. Reg. 28653 .

43

Petition for Reconsideration filed by California, Connecticut,

Delaware, Illinois, Maine,

Massachusetts, New Hampshire, New Jersey, New Mexico, New York, Pennsylvania, Rhode

Island, Vermont, and Wisconsin (May 31, 2005)

.

44

Petition for Reconsideration of Revision of December 2000,

Regulatory Finding, filed by

Natural Resources Defense Council, Clean Air Task Force, Ohio Environmental Council, United

States Public Interest Research Group, Natural Resource Council of Maine, Aroostook Band of

Micmacs, Houlton Band of Maliseet Indians, the Penobscot Indian Nation, the Passamaquoddy

Tribe of Maine (Indian Township and Pleasant Point)

.

45

Letter to Peter C . Harvey, Attorney General of New Jersey, and Jon P

. Devine, Jr., Natural

Resources Defense Council from Jeffrey Holmstead, Assistant Administrator

for Air and

Radiation, U .S. EPA (June 24, 2005)

.

24

---

Chapter 4: Status of Mercury Pollution Control Technology

Technology to reduce emissions from coal-burning power plants by more than 90

percent on many plants is now commercially available, cost-effective and rapidly

advancing

.

Controlling mercury emissions from coal-fired power plants does not require the

development of new technology . The leading technology for removing mercury from

EGU exhaust gases is essentially identical to that which has successfully been

deployed nationwide for years to curtail mercury emissions on large municipal waste

combustors. In recognition of the current state of technology, states in the Northeast

and other parts of the country have already adopted standards that are much more

stringent than proposed in the EPA's mercury rule and that should achieve reduction

targets on an earlier timetable .

Generally, there are two ways to reduce mercury emissions : technologies to

target mercury specifically; and technologies developed to reduce other pollutants, such

as PM or SO2, that produce mercury emission reductions as a "co-benefit ." Several

"multi-pollutant" technologies that target mercury and other pollutants are also

commercially available or are in the late stages of development and testing

.

Field tests of the most highly developed mercury control technology, known as

sorbent injection, have achieved mercury capture of up to 95 percent at coal-fired power

plants. Sorbent injection (typically Activated Carbon Injection) and other advanced

technologies have not yet been permanently installed at power plants because no law

requires it. But 95-percent capture rates have now been demonstrated in short-term

tests for all ranks of coal, bituminous, subbituminous and lignite . Chemically enhanced

sorbents make high rates of removal of all species of mercury achievable even with low-

rank coals .

The cost of mercury control technologies will decrease substantially over time as

a market evolves and as use becomes widespread, most stakeholders predict

.

Moreover, recent tests of chemically enhanced sorbents reveal that EPA's cost

projections overestimate the actual costs to power plants

.

Claims by some stakeholders that technologies are unavailable to reduce

emissions from coal-burning power plants are contradicted by the success of ACI in

large municipal combustors, by successful field tests and sales of ACI for electric

generating plants, and by recent National Energy Technology Laboratory (NETL) and

EPRI tests on myriad existing enhancements to ACI technology with respect to all coal

types. Further, existing control devices designed to control pollutants other than

mercury can significantly reduce mercury emissions

.

25

---

Mercury-Specific Control Technologies

ACI remains the leading option among control technologies specific for mercury

.

ACI is a mature mercury emission control technology, currently deployed on scores of

municipal waste combustors across the country with mercury removal rates of more

than 90 percent. Some plants, in fact, have achieved removal rates of more than 98

percent. The technology entails injecting a powdered sorbent that binds to mercury in

the flue gas and then collecting the particles with a particulate control device, such as

those already installed on all large EGUs. Activated carbon - carbon that has been

treated to alter its surface properties - is the most commonly used sorbent

.

Large-scale field tests of ACI on coal-fired electric generating units have

demonstrated removal rates of 90 percent and higher . Although no ACI unit has been

installed commercially on an EGU yet, 90-percent and higher mercury capture with ACI

is feasible. The technology involves very little capital equipment: a silo to hold the

sorbent, and hose, nozzles and pumps to inject it into the flue gas ducts . Tests on such

ACI systems continue to show improvement. The removal rates may be further

improved when the technology is used along with such additional controls as a fabric

filter, or "bag house," used for PM control . Some vendors are currently offering ACI to

electric generating plant customers and two sales have so far been reported

.

The efficiency of ACI in removing mercury from lower ranks of coal, such as

subbituminous and lignite, has clearly caught up with ACI's success rate in removing

mercury from bituminous coal. In a leading approach, the injection of halogenated

sorbents into the gas stream of units burning lower ranks of coal can enable ACI to

attain results comparable to those with bituminous coals . Carbon sorbents impregnated

with bromine or iodine compounds enhance capture of mercury on subbituminous

western coals, which contain lower chlorine levels and are therefore more challenging to

clean .

Research findings clearly indicate lignite and subbituminous coals behave

similarly to each other in terms of mercury speciation and control

.

For this reason,

halogenated sorbents offer much promise for improving mercury capture in these lower

ranks of coal. Moreover, the technology can be readily adopted on existing coal-fired

boilers

.

The capital costs of installing ACI are two orders of magnitude less than the

capital costs of equipment used to control oxides of sulfur or NO R .

Recent data from

field testing sponsored by NETL indicate that the average cost of controlling mercury

will range from 0.2 to 0.8 mills/KWh. Based on this estimate, mercury control would add

15 to 60 cents per month to a typical 750 KWh residential electric bill . Taking into

account capital and operating costs of ACI, one state agency has estimated the cost of

mercury control for its ratepayers at less than $10 per year

.

These new findings

illustrate the rapid pace of technological development in mercury control. Only a year

ago, EPA estimates ranged from 1 .12 and 3.10 mills/KWh,. Technologies are in

development that may further reduce the cost of ACI, which is driven by the cost of the

sorbent material . Processes that require less sorbent or more economical sorbents are

26

---

being tested. At a Wisconsin state hearing, one participant may have summed it up

best when he pointed out that, having paid $20 for his annual fishing license, he would

be happy to pay a similar amount if necessary to be able to eat the fish he caught

.

NETL and EPRI are currently testing the long-term efficacy of ACI

.

Recent

testing of other improvements to conventional ACI technology has also yielded

promising results, and such enhancements will further reduce cost of controls, EPA

forecasts .

For example, a process developed by EPRI, COHPAC-TOXECON, was

recently tested by Southern Company at a plant burning eastern low-sulfur bituminous

coal

.

The process entails injecting activated carbon downstream of an existing

electrostatic precipitator but upstream of a fabric filter . This keeps the majority of the fly-

ash from being contaminated because most of the ash is removed before the activated

carbon is introduced into the system. This innovation may be important for plants that

sell their fly ash for use in construction materials. In the long-term test, 90 percent of the

mercury was removed at reasonable cost

.

Multi-Pollutant Technologies

Tests of multi-pollutant technologies that specifically target mercury are yielding

better and better rates of reduction. Test results for KFX's K-FuelTM Technology on

subbituminous coals demonstrated mercury reductions of up to about 70 percent

.

Powerspan-ECOTM test results were up to 90 percent. Although fewer tests have been

completed on lignite-burning plants, the technology for controlling emissions from lignite

is mature enough to justify near-term deployment

.

KFX has begun operating a commercial plant in Wyoming for its K-Fuel TM

Technology, which is essentially a processed coal derived from western subbituminous

coals. Lower in ash and higher in British Thermal Unit (BTU) value, it yields lower

pollutant emissions than the parent coals. The two-step process relies on physical

separation and thermal processing to produce a fuel that has higher BTU value and is

cleaner than the original coal. It entails elevated temperature and pressure, greatly

reducing the moisture content of the coal . The mercury is volatilized and then captured

in a carbon-bed reactor. The process also removes sulfur and up to 30 percent of SO2

and NO, emissions. Besides operating its own plants, the company is making the

technology available for licensing to other facilities

.

Powerspan-ECOTM, with an 80- to-90-percent mercury removal range, is being

tested at a commercial facility in Ohio. It is a post-combustion multi-pollutant control

technology, consisting of a high-energy oxidation reactor followed by an ammonia-

based scrubber and a wet electrostatic precipitator, which captures the products of

oxidation (about 90 percent of NO, and 98 percent of the SO2 )

. The process produces

fertilizer byproducts (ammonium nitrate and sulfate) as do several other multi-pollutant

technologies that are in development, including the Enviroscrub/PahlmaniteTM process

and the Airborne Process .

27

---

Such multi-pollutant technologies are cost-effective in other ways . For example,

many of the multi-pollutant technologies produce a marketable by-product from the flue

gas air pollutants .

"Co-Benefits" From Technologies Designed to Reduce Emissions of Other

Pollutants

So-called "co-benefit" techniques are capable of achieving some mercury

reductions at many coal-powered plants . Systems that have been installed to reduce

emissions of SO2 , NO,, and PM sometimes can be operated to make some reductions

in mercury emissions. Some NO, control devices can enhance the ability of SO2

controls to reduce mercury emissions. At plants that have already installed

technologies to remove SO2 and NO, pollution, optimizing these control systems to

reduce mercury represents an extremely low-cost means to make a partial reduction in

mercury emissions . The potential for capturing mercury varies greatly at individual

plants depending on the control systems, the plant and the type of coal burned .

Recent research indicates that at certain EGUs with particular control technology

configurations burning certain bituminous coals, optimizing controls for PM, NO, and

S02 emissions for mercury removal may capture more than 90 percent of mercury in the

coal. Such remarkable capture efficiencies have been obtained using SCR for NO,

control and wet flue gas desulfurization (FGD) for SO2 control on a handful of plants

burning bituminous coal, including the Mecklenburg Cogeneration Facility in Virginia

and the Logan Generating Plant in New Jersey

.

High "co-benefit" mercury capture has been demonstrated at EGUs equipped

with scrubbers to control SO2 and fabric filters for PM control, but only a handful of

EGUs in the United States (about 14 percent) have fabric filters. Since ACI, especially

halogenated carbon sorbents, can accomplish approximately the same capture of

mercury at a cost two orders of magnitude smaller, it seems unlikely that many

additional scrubbers or fabric filters will be installed to achieve mercury "co-benefits

."

Whether optimized SCR and scrubbers used in tandem can remove mercury

from subbituminous and lignite coals remains to be seen . Scrubbers only effectively

capture mercury in its oxidized form as mercury chloride or another mercury halogen

.

They are incapable of capturing the insoluble elemental mercury . Better reduction rates

may be attainable for lower rank coals when additional halogenated sorbents are

injected into the flue gas in units fitted with an SCR and a wet FGD . The additional

halogen (often bromine or iodine) may increase existing concentrations of oxidized

mercury in the flue gas to levels sufficient for realizing reductions . So far, however, the

co-benefits achieved have been much lower on other plant configurations and coal

types other than bituminous. Other chemical additives that minimize re-emissions of

mercury from wet FGD systems currently in use at European coal-fired power plants, as

well as other enhancements, are also being tested in the United States

.

28

---

According to EPA, more than one-third of the mercury from coal burned by

electric generating plants is currently captured in existing systems installed to control

other pollutants. Many more plants are currently installing NO, and SO2 controls to meet

regulatory requirements for those pollutants. Though far from achieving desirable or

reasonably attainable mercury emission reductions, co-benefit techniques offer the

opportunity to obtain significantly more than the 21-percent reduction in the total

industry emissions targeted by EPA's CAMR .

Mercury Regulation Will Spur Rapid Technological Improvement

The pace of mercury control technology development is indeed moving rapidly

.

All trends indicate that several multi-pollutant and mercury-specific technologies are

entering the commercial market. The ongoing mercury debate, despite its unique

nuances, is similar to earlier regulatory debates regarding emissions controls from this

and other industry sectors

.

An analysis of decades of regulatory experience reveals that regulations

requiring emissions reductions will accelerate the pace of technology development and

demonstration and decrease compliance costs . The Northeast States for Coordinated

Air Use Management (NESCAUM) recently studied cases of control technology

development for NO, and SO2 from power plants and of the control of automobile

emissions through the use of technologies and fuels. NESCAUM concluded that

technological innovation follows, rather than precedes, regulatory requirements . In each

case early cost estimates dramatically overstated actual compliance costs. The report

cautions against enacting weak regulations that provide a lower level of environmental

protection than is affordable

.

References

40

C.F.R. 60.33b

(2002). Online .

July

1,

2002

edition. Online. Available

:

http://a257.g.akamaitech.net/7/257/2422/14mar20010800/edocket.access.gpo.gov/

cfr 2002/julgtr/pdf/40cfr60.33b.pdf

ADA-ES Newsletter, Issue 9, June 2005

.

Amar, P. (Project Director), NESCAUM report. "Environmental Regulation and

Technology Innovation: Controlling Mercury Emissions from Coal-Fired Boilers

."

September 2000

.

Amar, P. (Project Director), NESCAUM report, "Mercury Emissions From Coal-Fired

Plants: The Case for Regulatory Action ." October 2003 .

Black & Veatch . "Effective Mercury Reduction Strategy for Western Coal/K-Fuel

Technology," Report to EPA. March 2003. Online. Available

: www.kfx.com/index.htm .

29

---

"Clean Air Act:

Emerging Mercury Control

Technologies Have Shown

Promising

Results, but Data on Long-Term Performance Are Limited," General Accounting Office,

May 2005 .

Durham, M., et al, "Full-Scale Evaluation of Sorbent Injection for Mercury Control on

Power Plants Burning Bituminous and Subbituminous Coals," Powergen International

2002, Orlando, FL .

Durham, M. "Tools for Planning & Implementing Mercury Control Technology,"

American Coal Council, p. 43-46 .

"Environmental Energy Insights, Mercury Control Technologies An Update," Volume VII,

Issue 5, September/October 2004, p . 5-9 .

Farthing, G. "Full Scale Testing of Enhanced Mercury Control Technologies for Wet

FGD Systems." NETL Mercury Control Technology R&D Program Review Meeting,

Pittsburgh, PA, August 12-13, 2003 .

Iowa Department of Natural Resources Environmental Services Division Air Quality

Bureau. Prevention of Significant Deterioration (PSD) Permit Review Technical Support

Document Issuance of PSD Permits for Project Number 02-528, Plant Number 78-01-

026. MidAmerican Energy Company .

Massachusetts: 310 CMR 7.29; Connecticut: RCSA 22a-174-38; New Jersey: NJAC

Title 7, Chapter 27, Subchapter 27

.

McLarnon, C. "Mercury Removal in a Non-Thermal Plasma Based Multi-Pollutant

Control Technology for Utility Boilers." NETL Mercury Control Technology R&D Program

Review Meeting, Pittsburgh, PA, August 12-13, 2003

.

Memo to the Utility MACT Workgroup from the Ranking Subgroup . February 5, 2002 .

Online. Available : www.epa.gov/ttn/atw/combustlutiltox/feb5memo.pdf.

"Mercury Control Technologies for Electric Utilities Burning Lignite Coals," NETL,

Mercury Control Technology Program Review Meeting, August 12-14, Pittsburgh, PA

.

Monroe, L. S., Southern Co. Senate Environment and Public Works Committee

Subcommittee on Clean Air, Climate Change and Nuclear Safety Hearing on S. 485, the

Clear Skies Act, June 5, 2003 . Online. Available

:

http://epw.senate.gov/108th/Monroe 060503.htm .

NESCAUM. "Survey of Field Experience with Mercury Control for Municipal Waste

Combustors in the Northeast." August 2003

.

Pavlish, J.H. "Status Review of Mercury Control Options for Coal-Fired Power Plants

."

Accepted for publication in a special issue of Fuel Processing Technology .

30

---

Peltier, R . "Mercury Removal

Standards

are Coming

. Where

Is the Technology?"

POWER, Vol. 147, No 4 (May 2003)

.

Sjostrom, S. and J. Pavlish. "Analyses of Key Parameters Impacting Mercury Control

on Coal-Fired Boilers," Air Quality IV, September 22-24, Arlington, VA

.

Taylor, M. R., E. S. Rubin, and D. A. Hounshell. "Effect of Government Actions on

Technological Innovation for SO2 Control ." Environmental Science and Technology,

published online, doi:10.1021/es034223b (2003)

.

U.S. EPA White Paper. "Control of Mercury Emissions from Coal Fired Electric Utility

Boilers: An Update," February 18, 2005

.

3 1

---

Chapter 5: Existing State Programs to Control Mercury

Emissions from EGUs

Even before EPA's CAMR was adopted, the Conference of New England

Governors and Eastern Canadian Premiers called for a 75-percent reduction in mercury

emissions from all sources by 2010 and adopted an ultimate goal of the "virtual

elimination" of anthropogenic mercury emissions

.

At least six states have already adopted legislation or regulatory programs to

reduce mercury emissions

- Connecticut, Massachusetts, Minnesota, New Jersey,

North Carolina, and Wisconsin . Others, including Indiana, Michigan, Montana, New

Hampshire and Pennsylvania, are considering regulations or statutes to control mercury

emissions from coal-fired EGUs. The adopted state programs are all substantially more

protective of public health than the EPA CAMR . The following table provides basic

information on these programs

:

32

State

Program

Connecticut

90% control or 0.6 lb per trillion Btu (whichever is less stringent) by

2008 (statute) .

Massachusetts

85% capture or 0.00751b/GWi by 1/1/2008; 95% capture or 0.0025

lbs/GWh by 10/1/2012 (regulation)

.

Minnesota

Achieved a 70% reduction in emissions of mercury from 1990 levels

by 2005 (statutory requirement - applies to all emissions, including

utilities)

.

93% reduction goal is proposed

.

The schedule and

methods of achieving the goal are to be developed

.

New Hampshire

Cap of 50 lbs/year after federal compliance dates ; cap of 24 lbs/year

four years later. (Initial Department recommendation to legislature

.

Proposal for amended legislation due for legislative session that

commences January 2006 .)

New Jersey

90%

reduction

in emissions or 3 mg/MWi by

12/15/2007

(regulation); 5-year extension to 12/15/2012 available if multi-

pollutant control is being installed on all units for NO N , SO2, Total

Suspended Particulates and mercury

North Carolina

64% reduction in Hg by 2013 ; recommendations for additional

reductions due in 2005 (statute)

.

Wisconsin

40% reduction by 2010 ; 75% reduction by 2015 (regulation) . Goal of

80% reduction b 2018 requlation~

.

---

As is apparent from the table, the states have a far more optimistic view of the

availability of mercury pollution control technology and techniques than does EPA

.

Based on their staffs' expertise in mercury emission control technology, they have

adopted emission limitations that will require the use of mercury control technology by

as early as 2007

.

The states with the most stringent requirements, Massachusetts and New

Jersey, both offer owners and operators of EGUs a choice of meeting a percentage

reduction requirement or an emission limitation expressed in terms of mercury

emissions per unit of energy output (lb/GWh or mg/MWh). Output-based standards

have the benefit of encouraging efficiency . The STAPPA and ALAPCO Model Rule

presented in the following chapter includes both types of standards .

New Jersey requires meeting mercury emission limitations by December 15,

2007, but offers an extension of the mercury compliance deadline for up to half of

generating capacity to owners and operators of coal-fired EGUs who agree to meet

multi-pollutant standards by December 15, 2012 . Covered units must meet emission

limitations for SO 2

, NOR , and PM, as well as the state's mercury standards

.

33

---

Chapter 6: The STAPPA and ALAPCO Model Rule

A . Preamble to Model Rule

I. Architecture of the Model Rule

.

The Model Rule provides standards applicable to coal-fired EGUs in two phases

.

Though based on the accumulated knowledge of state and local air pollution

control

officials regarding the state of the art in mercury emission reduction technology,

these

standards do not specify or require any particular technology or method .

The objective

is to identify achievable emission reductions that will

protect public health, and to

stimulate the rapid commercialization of additional mercury control technologies and

methods to achieve those reductions

.

In the last few years,

mercury control

technologies for coal-fired EGUs have advanced rapidly

.

Studies have shown that

continuous advances in control technology will be assured only if manufacturers know

there will be a market in the near term sufficient to justify significant investments

.

STAPPA and ALAPCO have developed two different approaches in this Model

Rule .

Each of these Options leaves owners or operators free to choose their own

control strategies . Whatever the control

strategy chosen, however, the emission

standard must be met. Under each Option, new and modified sources will be required

to capture 90-95 percent of inlet mercury, or meet a specified mercury output-based

emission standard . The state will need to consider, within five years, whether to tighten

these emission standards for new and modified sources based on available

mercury

emissions control equipment and techniques. The two Options take somewhat different

approaches to existing sources, however

.

For existing sources, each Option has two

Phases

.

Option I is

designed to achieve substantial public health benefits in the near term,

while providing owners and operators flexibility with regard to which emission reduction

technology and measures, on which units, will be installed

.

Phase 1 requires each

owner or operator to capture an average of at least 80 percent of inlet mercury from

its

existing EGUs in the state, or meet a specified alternative average output-based

emission standard, by the end of 2008. Four years later, Phase 2 requires each

covered electric generating plant to meet a state-specified requirement to capture 90-95

percent of inlet mercury or meet a specified

alternative output-based emissions

standard

.

Option II

achieves similar ends, but offers a different alternative to owners and

operators who wish to coordinate their mercury control efforts with the installation of

control technologies for SO2

, NO, and/or PM

.

Under Option II, an owner or operator

34

---

may choose to postpone compliance for four years with the Phase 1 mercury standard

at EGUs constituting not more than 50 percent of its generating capacity in the state if

the owner or operator makes binding enforceable commitments to meet specified

emissions standards for SO2 , NO,, PM, and mercury by the end of 2012

.

The

remainder of an owner or operator's EGUs must capture a minimum of 90-95 percent of

inlet mercury, or meet a specified output-based emission standard, by the end of 2008

.

Emission limitations for new EGUs and for existing EGUs in Phase 2 of both

Options of the Model Rule are stated as a range

(i .e ., either a 90-95 percent capture of

inlet mercury, or an output-based mercury emissions standard between 0 .0060 and

0.0025 lb/GWh). These ranges recognize today's uncertainty about the ultimate

capability of technologies to remove mercury . STAPPA and ALAPCO are persuaded

that, using currently demonstrated technologies, existing EGUs are capable of capturing

at least 90 percent of inlet mercury on the timetables provided in the Model Rule . Many

STAPPA and ALAPCO members are convinced that greater reductions - of at least 95

percent - can be achieved on the specified timetables. Indeed, Massachusetts

regulations already require 95-percent capture of inlet mercury by 2012

.

Past

experience with other pollution control technologies and methodologies suggests that

pollution reduction efficiencies will turn out to be greater, and costs lower, than today's

most optimistic predictions

.

II. How Would a State Adopt the Model Rule?

The federal CAMR requires that a state adopt and submit a State Plan showing

how it will reduce statewide mercury emissions sufficiently to achieve the EPA-imposed

mercury emissions budget. 70 Fed . Reg. 28624 (May 18, 2005) . The EPA rule offers a

model cap-and-trade program as one way to implement the required emission

reductions. The cap-and-trade program is optional, not required . Thus as long as a

State Plan provides for achieving mercury emission reductions sufficient to meet the

federal emissions budget for the state and meets the other minimum requirements of

CAMR, EPA is bound by its own rule to approve the State Plan

.

III. Choosing an Option

.

The Model Rule assumes that each regulated entity would make an initial choice

to comply with one of the Options that will apply thereafter to all units it owns or

operates within the state. The state will review the compliance plan submitted by the

source owner or operator to assure that it is adequate and enforceable, and that the

plan includes the baseline or other information that will be needed to determine

compliance. If the state concludes that the compliance plan is adequate and

enforceable, and that it provides the necessary information, the state will incorporate the

relevant provisions into its State Plan

.

35

---

IV .

Emissions Trading

.

STAPPA and ALAPCO have been supporters of using a cap-and-trade system to

control the emissions responsible for acid rain and other programs to address broad

regional, national or international environmental problems . However, state and local air

pollution control officials do not recommend trading programs where exposures to

hazardous air pollutants can be heavily influenced by nearby emission sources

.

If

trading were allowed in such situations, existing high pollution "hot spots" could be

allowed to continue or worsen, and new hot spots could be created, by EGUs' decisions

to comply using credits rather than reducing emissions . EPA has argued, based on

computer modeling, that its mercury cap-and-trade program will not produce mercury

hot spots. While the accuracy of these computer-based predictions of utility industry

behavior can be debated, the key point is that citizens are not probabilities . State and

local pollution control officials cannot endorse a system that promises only a probability

of health protection to their citizens

.

Thus the Model Rule requires, under either Option, that the ultimate Phase 2

limitation be met at each plant site . STAPPA and ALAPCO oppose allowing EGUs to

comply with mercury standards through a broad trading program that allows interstate

trading and banking of emission allowances . If allowance trading is acceptable, some

owners or operators will choose to comply using emission allowances rather than

reducing mercury emissions; similarly, if allowances may be banked, state and local air

pollution control agencies cannot prevent them from being used later . In our view, it is

not appropriate to place public health policy decisions in the hands of private entities

.

Consistent with this policy, the Model Rule includes no emissions trading regime

.

In order to allow for more demanding requirements in the near term, Option I

temporarily provides for contemporaneous emissions averaging among units owned or

operated within the state by each entity. From 2008 to 2012, compliance with Option I

can be achieved by emissions averaging among units within the state owned or

operated by the same entity. If a unit is owned or operated by more than one entity, the

state or local agency will make a binding allocation to each owner or operator of an

appropriate portion of the generation from the unit for purposes of demonstrating

compliance. Emission reductions in a current year may not be banked - that is, they

may not be used to average against mercury emissions in a future year. In Phase 2,

intrastate emissions averaging is not permitted

.

Contemporaneous emissions

averaging at a site where there is more than one emission unit is acceptable under both

Options as a Phase 2 compliance strategy because it will provide the same protection

against hot spots as if each unit at a site individually complied with the Phase 2

emission limitation

.

The Model Rule also provides for dealing with mercury emission allowances

allocated under the CAMR rule . Under CAMR, EPA will allocate an amount of emission

allowances to each state equal to the state's EPA-established mercury emission

budget. In turn, states that adopt a cap-and-trade system are expected to reallocate all

or part of their cache of mercury allowances to owners and operators of EGUs within

36

---

their borders. Under CAMR, individual owners and operators would be allowed to trade

allowances freely within or even outside the state

.

Even though CAMR allowances may not be used for compliance with the Model

Rule, the purposes of the Model Rule would be defeated if the state were to distribute

the EPA CAMR allowances and allow in-state owners and operators to transfer or sell

those allowances to be used by EGUs outside the state . If interstate sales were

allowed, the allowances could license emissions upwind that would be blown back into

a state that had adopted the Model Rule. For this Model Rule to be effective, therefore,

states that adopt the Model Rule must retain the CAMR emissions allocated by EPA

rather than selling or reallocating them to owners and operators of EGUs in the state

.

V. Applicability .

The Model Rule applies to coal-fired EGUs. STAPPA and ALAPCO recognize

that oil-fired EGUs are also a source of significant hazardous air pollutant emissions,

particularly nickel. Because of the differences in emissions and control technologies

between coal- and oil-fired EGUs, however, this Model Rule is limited to mercury

emissions from coal-fired units with a capacity exceeding 25 MWe .

VI. One Standard for All Coals

.

The Model Rule does not provide different emission standards for different ranks

of coals. While it was earlier believed that mercury emission control technologies were

not capable of achieving high levels of removal in units burning lower ranks of coal, the

most recent research gives confidence that commercially available technologies will be

capable of achieving the same high levels of mercury removal in time to achieve the

standards of each Phase of the Model Rule program

.

VII. Variances and Exceptions

.

Variances or special exceptions are sometimes used as a means to provide

regulatory flexibility to deal with differences in fuels or technological issues among

emission sources. The Model Rule provides for flexibility in two ways :

•

Compliance is determined on an annual rolling average basis, not over short-

term periods. By using a rolling annual average, the Model Rule assures that

short-term variations in fuels and in the performance of pollution control

technology will not cause noncompliance

.

•

Each Option incorporates an explicit method in Phase 1 to provide

compliance flexibility

.

In Option I, owners and operators are permitted to

comply with the Phase 1 standard through intrastate averaging of emissions

from their units . In Option II, an owner or operator that commits to meeting

multi-pollutant standards at the end of 2012 may choose to postpone

37

---

compliance with the mercury emission standard for four years at no more

than half the entity's electric generating capacity

.

Because the Model Rule incorporates these flexibility mechanisms, STAPPA and

ALAPCO believe that compliance can be achieved across the industry in the time

periods provided

.

Should an EGU fail to meet the applicable mercury emissions

standards under the Model Rule, despite having implemented the emission reduction

measures and technologies included in the State Plan, existing state regulations provide

a number of potential responses . Some states provide in the permit for an explicit

limitation on liability for sources required to achieve a stringent emission standard

.

Some require a noncompliant source to agree to a consent agreement, in some cases

imposing monetary penalties . Others provide for "alternative emission limitations" if a

source can demonstrate that it has failed to meet the emission standard despite best

efforts. States that currently do not have such flexibility mechanisms may want to

consider adopting them in the process of adopting the Model Rule

.

VIII. Monitoring and Record Keeping Requirements

.

The Model Rule follows the federal CAMR with respect to monitoring and

reporting requirements

.

38

---

B

. STAPPA and ALAPCO Model Mercury Emissions Control Rule For Coal-Fired

Electric Generating Units

I . Policy Objective .

The purposes of this regulation are

:

a. To protect the public health and welfare of the State of by

requiring substantial reductions in emissions of mercury from coal-fired

electric generating units

;

b. To require, in two stages, installation of pollution control equipment and/or

other measures to achieve specified reductions in mercury emissions from

coal-fired electric generating units no later than the end of 2008 and 2012

;

and

c. To provide flexibility in implementation in order to reduce the economic cost of

meeting the requirements of this regulation

.

II. Definitions . When used in this chapter, the terms below shall have the following

meanings

:

Boiler means an enclosed fossil- or other fuel-fired combustion device used to

produce heat and to transfer heat to recirculating water, steam or other medium

.

Bottoming-cycle cogeneration unit means a cogeneration unit in which the

energy input to the unit is first used to produce useful thermal energy and at least some

of the reject heat from the useful thermal energy application or process is then used for

electricity production

.

Coal means any solid fuel classified as anthracite, bituminous, subbituminous or

lignite by the American Society of Testing and Materials (ASTM) Standard Specification

for Classification of Coals by Rank D388-77, 90, 91, 95, or 98a (incorporated by

reference, see 40 CFR part 60, §60.17)

.

Coal-derived fuel means any fuel (whether in a solid, liquid or gaseous state)

produced by the mechanical, thermal or chemical processing of coal

.

Coal-fired means combusting any amount of coal or coal-derived fuel, alone or in

combination with any amount of any other fuel, during any year

.

Cogeneration Unit means a stationary, coal-fired boiler or stationary, coal-fired

combustion turbine

:

(1) Having equipment used to produce electricity and useful thermal energy for

industrial, commercial, heating or cooling purposes through the sequential use of

energy; and

39

---

(2) Producing during

the 12-month period

starting on

the date the unit first

produces electricity and during any calendar year after which the unit first produces

electricity

:

(a) For a topping-cycle cogeneration unit :

(i) Useful thermal energy not less than 5 percent of total energy output ; and

(ii) Useful power that, when added to one-half of useful thermal energy produced,

is not less than 42.5 percent of total energy input, if useful thermal energy produced

is

15 percent or more of total energy output, or not less than 45 percent of total

energy

input, if useful thermal energy produced is less than 15 percent of total energy output

;

and

(b) For a bottoming-cycle cogeneration unit, useful power not less than 45

percent of total energy input

.

Combustion turbine means :

(1) An enclosed device comprising a compressor, a combustor, and a turbine

and in which the flue gas resulting from the combustion of fuel in the combustor passes

through the turbine, rotating the turbine ; and

(2) If the enclosed device under paragraph (1) of this definition is combined

cycle, any associated heat recovery steam generator and steam turbine

.

Electric Generating Unit or Unitmeans :

(1)(i) Except as provided in paragraph

(ii), a stationary coal-fired boiler (boiler) or

stationary, coal-fired combustion turbine (combustion turbine) in the state serving at any

time a generator with a nameplate capacity of more than 25 megawatts electric (MWe),

producing electricity for sale ; or

(ii) A stationary boiler or stationary combustion turbine that, under paragraph

(1)(i) of this definition, is not an electric generating unit, which begins to combust coal or

coal-derived fuel and to serve a generator with a nameplate capacity of more than

25

MWe producing electricity for sale .

(2) "Electric generating unit" does not include a boiler or combustion turbine that

qualified as a cogeneration unit during the 12-month period subsequent to the date

it

first produced electricity and continues to qualify as a cogeneration unit, and which has

not served, at any time, a generator with nameplate capacity of more than 25 MWe

supplying in any calendar year more than one-third of the unit's potential electric output

capacity, or 219,000 megawatt hours (MWh), whichever is greater, to any utility power

distribution system for sale . If an otherwise qualifying boiler or combustion turbine

40

---

ceases to qualify as a cogeneration unit, it shall become subject to paragraph (1) of this

definition starting on the day it no longer qualifies as a cogeneration unit

.

(3) "Electric Generating Unit" does not include a "solid waste incineration unit" as

defined in Clean Air Act section 129(g)(1) combusting "municipal waste" as defined in

Clean Air Act section 129(g)(5) so long as it is subject to Subpart Eb of 40 CFR Part 60

;

Subpart AAAA of 40 CFR Part 60; an EPA-approved state plan for implementing

Subpart Cb of 40 CFR Part 60: Subpart FFF of 40 CFR 62; an EPA-approved state plan

for implementing Subpart BBBB of 40 CFR Part 60; or Subpart JJJ of 40 CFR Part 62

.

Electric Generating Plant means an Electric Generating Unit or Units that are

located on one or more contiguous or adjacent properties, and under common control of

the same person (or persons under common control) which supply electricity to the

electricity grid through a common electrical connection

.

Existing Unit or Existing EGU means any Electric Generating Unit other than a

new Electric Generating Unit

.

Inlet Mercury means the average concentration of mercury in flue gas at the inlet

of the emission control device immediately downstream of the boiler of an Electric

Generating Unit, as determined by methods prescribed by the state

.

Nameplate Capacity means, starting from the initial installation of a generator,

the maximum electrical generating output (in MW) that an Electric Generating Unit is

capable of producing on a steady-state basis during continuous operation as specified

by the manufacturer .

New or Modified Unit or New or Modified Electric Generating

Unit means any

Electric Generating Unit, construction or modification of which is commenced after the

date of publication of proposed regulations prescribing a standard for control of mercury

that will be applicable to the Electric Generating Unit

.

NO, means oxides of nitrogen (nitrogen oxide and nitrogen dioxide)

.

Operator means any person that operates, controls or supervises an electric

generating unit or a source that includes an electric generating unit and includes, but is

not limited to, any holding company, utility system or plant manager of such an electric

generating unit or source

.

Output-Based Emission Standard means a maximum allowable rate of emissions

of mercury or other pollutant per unit of electrical output from an EGU

.

Owner means any person that has an ownership interest, legal or equitable, (or

who is a holder of a leasehold interest) in a unit; or is an owner or operator of a unit, or

any purchaser of power from a unit or owner or operator under a life-of-the-unit, firm

4 1

---

power contractual arrangement, provided that, unless expressly provided in leasehold

agreement, the term "owner" shall not include a passive lessor

.

PM means particulate matter

.

SO2 means sulfur dioxide

.

Ill. Applicability. The requirements of this chapter apply to owners and operators of

Electric Generating Units located within the State of

IV. Requirements. The owner or operator of an Electric Generating Unit subject to

this chapter shall, not later than , apply to the [Department] for a mercury

emissions permit .

Such application shall include :

1

.

A statement indicating that electric generating units in the state under the

control of the owner or operator will comply with the emission limitations

and other requirements of §V.A and §V.B or §V.C of this chapter

;

2 .

A detailed compliance plan for each applicable emission limitation for each

unit under the control of the owner or operator, including monitoring and

reporting

;

3 .

A description of the fuel assumptions on which the plan is based ; and

4 .

A description, for units where a catalytic reduction device will be installed

to reduce emissions of NOR , of the measures that will be taken to avoid

any increase in emission of oxidized forms of mercury

.

A .

B

.

The [Department] shall promptly review the mercury permit application and shall,

if the application meets the terms of this chapter, issue a permit. Such permit

shall include :

1

.

[Option I] Provisions applicable to each unit as follows

:

a .

Enforceable requirements to comply with the emission limitations

and other conditions of §V.A and §V.B.1 and §V.B.3 for the period

commencing December 31, 2008 and ending December 30, 2012

;

b .

Enforceable requirements to comply with the emission limitations

and other requirements of §V.A and §V.B.2 and §V.B.3 for the

period commencing December 31, 2012 ; and

c

.

Enforceable requirements

to

comply

with

the

monitoring,

recordkeeping and reporting obligations of §§VII and VIII

.

2

.

[Option II] Provisions applicable to each unit as follows

:

42

---

a

.

Enforceable requirements to comply with the emission limitations

and other obligations of §§V.A, V.C.1 and V.C.4 for the period

commencing December 31, 2008 and ending December 30, 2012

;

b .

Enforceable requirements to comply with the emissions limitations

and other obligations of §§V.A, V.C.2 and V.C.4 commencing

December 31, 2012 ; and

c .

Enforceable

requirements

to

comply

with the monitoring,

recordkeeping and reporting obligations of §§VII and VIII

.

V. Emission Standards

.

A .

Emission Standards for New Units

.

1 . Any new or modified unit subject to this chapter shall comply at

commencement of operation with one of the following two standards on a

rolling 12-month basis :

2 .

The Department shall review the emission standards of §V .A.1 within five

years after adoption of this regulation, and subsequently at intervals of no

more than five years, to determine whether greater reductions in mercury

emissions are available, and shall revise the emission standard for new

and modified units accordingly not more than one year after completion of

its review

.

B .

Emission Standards for Existing Sources : Option I . An electric generating

unit subject to this chapter shall meet the following emission limitation

requirements, unless the owner or operator chooses to comply with §V .C :

1

.

Phase 1 -

a

.

. Beginning December 31, 2008, the owner or operator of an existing

unit subject to this chapter shall comply with one of the following

standards on a rolling 12-month basis

:

i

.

A mercury output-based emission standard of 0.010 Ib/GWh ;

or

ii

.

A minimum 80-percent capture of inlet mercury,

b .

An owner or operator may demonstrate compliance with §V .B.1 .a

by averaging emissions from all existing units it owns or operates

within the state

.

43

a

.

A mercury output-based emission standard of 0.0060 - 0.0025

b

.

Ib/GWh ; or

A minimum 90-95 percent capture of inlet mercury

.

---

2

.

Phase 2 -

a .

Beginning December 31, 2012, the owner or operator of an existing

unit subject to this chapter shall comply with one of the following

standards on a rolling 12-month basis

:

i .

A mercury output-based emission standard of 0.0060 -

0.0025 lb/GWh; or

it

.

A minimum 90-95 percent capture of inlet mercury

.

b .

An owner or operator may demonstrate compliance with §V .B.2 .a

by averaging emissions from all existing units owned or operated at

a single electric generating plant

.

In the event that a unit is owned or operated by more than one

entity, the [Department], shall, for purposes of demonstrating

compliance with Phase 1 or Phase 2 standards through averaging

emissions, allocate to each owner or operator an appropriate

portion of the generation from the unit to each owner or operator

with such interest on the basis of information available to the

[Department]

.

The [Department's] allocation of interests for this

purpose shall be final .

c

.

3 .

An owner or operator that installs a selective catalytic reduction system or

other device on an electric generating unit subject to this chapter to control

emissions of NO, shall take whatever steps are necessary to prevent any

increase in emissions of oxidized forms of mercury

.

C. Emission Standards for Existing Units : Option II

.

An electric generating unit

subject to this chapter shall meet the following emission limitation requirements,

unless the owner or operator chooses to comply with §V .B :

1

.

Phase 1 -

a .

Beginning December 31, 2008, each company that owns or

operates an existing electric generating unit shall comply with one

of the following standards on a rolling 12-month basis

:

i .

A mercury output-based emission standard of 0 .0060 -

0.0025 lb/GWh ; or

ii

.

A minimum 90-95 percent capture of inlet mercury

.

b

.

An owner or operator may postpone compliance with §V .C.1.a for a

group of its units that comprise not more than 50 percent of the

owner or operator's electric generation capacity in the state . Such

44

---

2 .

Phase 2 -

a postponement may be granted by the [Department] upon

approval of

:

i .

Enforceable commitments for each postponed unit to comply

with the multi-pollutant control requirements of §V.C .2.a and

§V.C.2.b no later than December 31, 2012; and

ii

.

Enforceable commitments for each postponed unit to

prevent increases in oxidized mercury emissions from the

date this regulation is proposed through December 30, 2012

.

a

.

Beginning December 31, 2012, each unit subject to this chapter for

which compliance with Phase 1 has been postponed pursuant to

§V.C .1 .b shall comply with each of the following multi-pollutant

emission limitations :

i

.

Sulfur Oxides

:

A .

A sulfur dioxide output-based emission standard of

1 .5 lb/MWh ; or

B .

A minimum 95 percent capture of fuel sulfur .

ii .

Nitrogen Oxides: A nitrogen oxides output-based emission

standard of 1 .0 - 0.7 lb/MWh

.

iii

.

Mercury :

A .

A mercury output-based emission standard of 0 .0060

- 0.0025 lb/GWh; or

B .

A minimum 90-95 percent capture of inlet mercury

;

C .

Compliance to be determined on a rolling 12 month

basis .

b .

Beginning December 31, 2012, each unit subject to this chapter for

which compliance has been postponed pursuant to §V.C.1.b shall

comply with a particulate matter emission standard of 0.030- 0.015

Ib/mmBtu. Compliance will be determined based on testing once

per year .

3 .

In the event that a unit is owned or operated by more than one entity, the

[Department], shall, for purposes of demonstrating compliance with §§V .A,

V.B, or V.C by averaging emissions at any electric generating plant,

allocate to each owner or operator an appropriate portion of the

generation from the unit to each owner or operator with such interest on

45

---

the basis of information available to the [Department] . The [Department's]

allocation of interests for this purpose shall be final

.

4. An owner or operator who installs a catalytic reduction or other device to

control emissions of NO, on a unit subject to this chapter shall take

whatever steps are necessary to prevent any increase in emissions of

oxidized forms of mercury .

VI . Compliance Determination .

A. Compliance with the 12-month rolling average emission standards of this chapter

shall be determined in accordance with the method set forth at 40 CFR Part 60,

Subpart Da, § 60.50(h) .

B. Compliance with the multi-pollutant requirements of this chapter shall be determined

in accordance with the procedure set forth in the [Department's] regulations at

VII

. Monitoring .

A. The owner or operator of an EGU subject to this chapter demonstrating compliance

with a mercury emission limitation shall measure, record and report the mercury in

the exhaust gases by meeting the requirements of 40 CFR Part 60, §60 .49a(p),

60.4170-60.4176, and 40 CFR Part 75, Subpart I .

B. The owner or operator of an EGU subject to this chapter demonstrating compliance

with an emission limitation for S02 or NO, pursuant to §V.C.2.a shall make such

demonstration using data collected to meet the requirements of 40 CFR Part 75, in

addition to any other required information (such as S02 inlet concentration and MWh

generated). The owner or operator of an EGU subject to this chapter demonstrating

compliance with an emission limitation for particulate matter pursuant to §V.C.2 .b

shall make such a demonstration using 40 CFR Part 60 Method 5

.

VIII. Recordkeeping and Reporting .

A. The owner or operator of an electric generating unit subject to this chapter shall

comply with the record keeping and reporting requirements incorporated in 40 CFR

Part 75 and 40 CFR Part 63, §63.10(b) - (f)

.

B. The owner or operator of an electric generating unit subject to this chapter shall

maintain for a period consistent with its Operating Permit, and file with the

[Department], records of all compliance calculations and supporting information

.

46

---

IX. Treatment of EPA Mercury Allowances

.

In the event that the U .S. Environmental Protection Agency allocates mercury

allowances to the state of , such allowances shall be treated as follows

:

A. No such allowances shall be allocated to any owner or operator of EGUs or other

sources of mercury emissions into the atmosphere or discharges into the water of

the state

.

B. The state shall hold all allowances allocated by EPA to the state. At the end of each

calendar year, the state shall instruct the U .S. Environmental Protection Agency to

retire permanently all such allowances

.

47