EPA Finalizes Rules for Fossil Fuel–Fired Power Plants, Including GHG Standards

The US Environmental Protection Agency (EPA) released on April 25, 2024 the prepublication versions of four final rules applicable to fossil fuel–fired power plants. The rules establish carbon dioxide standards for existing coal-fired power plants and new gas-fired power plants, limits for mercury emissions from lignite-fired power plants and emission of toxic metals from all coal-fired power plants, more stringent standards on wastewater discharged from coal-fired power plants, and requirements applicable to inactive coal ash impoundments at inactive facilities.

While the four rules are issued under separate statutory authorities—the Clean Air Act (CAA), Clean Water Act (CWA), and Resource Conservation and Recovery Act (RCRA)—together they represent the Biden administration’s latest efforts to regulate power plants, including the reduction of greenhouse gasses (GHGs) in order to address climate change. 

GREENHOUSE GAS STANDARDS AND GUIDELINES RULE

EPA’s final rule, New Source Performance Standards for Greenhouse Gas Emissions from New, Modified, and Reconstructed Fossil Fuel-Fired Electric Generating Units; Emission Guidelines for Greenhouse Gas Emissions from Existing Fossil Fuel-Fired Electric Generating Units; and Repeal of the Affordable Clean Energy Rule (the GHG Standards and Guidelines Rule) takes several actions aimed at the regulation of GHGs:

• Finalizes the repeal of the Affordable Clean Energy Rule, which had defined the best system of emission reduction (BSER) for CO2 emissions from coal-fired power plants to be heart rate improvements.
• Establishes GHG emission standards for new combustion turbines that vary depending upon whether the unit’s capacity factor is base load, intermediate load, or low load. The standards include efficient design, a low-emitting fuel standard and, for base load units, a 90% carbon capture standard by January 1, 2032.
• For existing coal-fired electric generating units (EGUs), establishes standards that are based on the expected duration of the unit’s continued operation. Coal-fired EGUs with an anticipated useful life beyond January 1, 2039 are expected to meet by January 1, 2032 an emission rate based on achieving 90% carbon capture through use of carbon capture and sequestration. Coal-fired EGUs that commit to cease operations by January 1, 2039 are expected to meet an emission rate by January 1, 2030 based on co-firing 40% natural gas, and units that plan to permanently cease operations prior to January 1, 2031 have no emission reduction obligations under the rule. States are required to submit plans to EPA within two years from the publication of the rule, in which the state describes its plans for implementing the standards for existing coal-fired EGUs, with the rule recognizing some flexibility in implementation based on localized circumstances.
• Revises the New Source Performance Standards (NSPS) for GHG emissions from fossil fuel–fired steam generating units that undertake major modifications.

The GHG Standards and Guidelines Rule is scheduled to become effective 60 days following publication in the Federal Register. Challenges to this rule are anticipated, making it possible that implementation may be stayed pending resolution of court challenges. 

MERCURY AND AIR TOXICS STANDARDS AMENDMENT RULE

Under Section 112 of the CAA, EPA is required to set standards for major sources of hazardous air pollutants (HAPs) based on the maximum achievable control technology. EPA must also review and, if necessary, revise those standards every eight years. 

In 2012, EPA finalized its National Emission Standards for Hazardous Air Pollutants (NESHAP) for Coal- and Oil-Fired Electric Utility Steam Generating Units, also known as the Mercury and Air Toxics Standards (MATS). The 2012 MATS rule set technology-based emissions standards for mercury and HAPs emitted by units with a capacity of over 25 megawatts, but set less-stringent mercury emissions standards for lignite-burning EGUs than for other coal-fired EGUs.

The new final rule, National Emission Standards for Hazardous Air Pollutants: Coal- and Oil-Fired Electric Utility Steam Generating Units Review of the Residual Risk and Technology Review (the MATS Amendment Rule):

• lowers the filterable particulate matter (fPM) emission standard that acts as a surrogate for nonmercury metal HAP emissions from existing coal-fired EGUs;
• amends the fPM emission standard compliance demonstration requirements;
• requires lignite-fired EGUs to meet the same mercury emissions limits as EGUs burning other types of coal; and
• incorporates a revised definition of “startup” that ends when steam from the boiler is used to generate electricity.

The MATS Amendment Rule is scheduled to become effective 60 days after publication in the Federal Register. Affected facilities will have three years from the effective date to come into compliance with the revised emissions standards and compliance demonstration requirements, and affected sources will have 180 days to comply with amendments related to the revised definition of “startup.” However, as with the GHG Standards and Guidelines Rule discussed above, the MATS Amendment Rule is likely to be challenged. 

LEGACY CCR RULE

EPA established national regulations regarding the disposal of coal ash from coal-fired power plants in 2015. Those regulations imposed requirements on inactive surface impoundments at active facilities, but not on inactive surface impoundments at inactive facilities. In 2018, the DC Circuit vacated and remanded the 2015 rule on the grounds that EPA had acted arbitrarily and capriciously in exempting from regulation inactive surface impoundments at inactive facilities.

In the April 2024 final rule, Hazardous and Solid Waste Management System: Disposal of Coal Combustion Residuals from Electric Utilities; Legacy CCR Surface Impoundments (the Legacy CCR Rule), EPA establishes requirements for monitoring groundwater, corrective action, and closure and post-closure care for CCR surface impoundments and landfills closed before the effective date of the 2015 regulation and inactive CCR landfills and inactive CCR piles at active facilities and those at inactive facilities with a legacy CCR surface impoundment.

This rule is scheduled to become effective 180 days after publication in the Federal Register. As with the other rules included in this set of regulations, challenges are expected, which challenges may result in a stay of implementation.

STEAM ELECTRIC POWER GENERATING EFFLUENT GUIDELINES RULE

Under the CWA, discharges of pollutants from a point source to waters of the United States are prohibited unless they are authorized by a National Pollutant Discharge Elimination System (NPDES) permit, which incorporate effluent limits that may be based on Effluent Limitations Guidelines (ELGs).

The new rule, Supplemental Effluent Limitations Guidelines and Standards for the Steam Electric Power Generating Point Source Category (the Supplemental ELGs Rule):

• updates requirements applicable to fossil fuel–fired steam EGUs for discharges of flue gas desulfurization (FGD) wastewater and bottom ash (BA) transport water;
• replaces limitations for combustion residual leachate (CRL) that had been previously vacated by the courts; and
• finalizes a site-specific approach to developing technology-based limitations.

Specifically, the Supplemental ELGs Rule imposes a zero-discharge limitation for all pollutants in FGD wastewater, BA transport water, and CRL as well as nonzero numeric limitations for mercury and arsenic in unmanaged CRL and legacy wastewater discharged from surface impoundments undergoing the closure process, as long as those surface impoundments had not already commenced closure under the previous regulations. In addition to those new limitations, the Supplemental ELGs Rule eliminates less-stringent requirements for high-flow facilities and low-utilization EGUs. 

The Supplemental ELGs Rule is scheduled to become effective 60 days after the date of publication in the Federal Register, with NPDES permit for effected facilities subsequently incorporating the new standards. As with the other rules discussed above, legal challenges to the Supplemental ELGs Rule are anticipated.

IMPLICATIONS

As noted above, it is anticipated that all four of these rules will face challenges. EPA’s press release indicate that the agency views these rules as an expression of EPA’s “commitment to reduce pollution from the power sector while providing long-term regulatory certainty and operational flexibility.”^[1] While the ultimate outcome of any challenges remains unclear, these rules represent a significant effort by the Biden administration to further regulate power plants and address climate change.