Preparation of Control StrategiesEGU Sector

Clean Air Markets DivisionU.S. EPA Office of Air and Radiation

17 October 2007

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• Brief Background on IPM• How are EGU strategies prepared?

– Base Case (CAIR/CAMR/CAVR)– Where are the cost-effective additional

reductions possible?• Regional programs • Potential state policies?• Geographic extent• Projected NA areas

– Other Impacts

Overview

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Brief Background on IPM: What is IPM?• IPM is a long-term

capacity expansion and production costing model for analyzing the U.S. electric power sector

• EPA uses IPM to analyze emissions policies affecting the power sector

• IPM outputs are used in EPA’s air quality models

• IPM was used on– CAIR– CAMR– CAVR– Clear Skies Initiative

Model Regions in IPM v3.0

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Brief background on IPM: IPM Structure

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CAIR Emission Caps*(million tons)

2009/2010 2015

Annual SO2 3.7 2.6(2010)

Annual NOx 1.5 1.3(2009)

Seasonal NOx .58 .48(2009)

*For the affected region.States controlled for fine particles (annual SO2 and NOx)

States controlled for ozone (ozone season NOx)

States controlled for both fine particles (annual SO2 and NOx) and ozone (ozone season NOx)

CAIR Geographic Coverage

States not covered by CAIR – sources are required to meet Regional Haze requirements

Regional Policy already in place:Base Case (CAIR/CAMR/CAVR)

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Annual NOx: State-Level Emissions

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2020 Summer Season EGU NOx Emissions under CAIR/CAMR/CAVR by Fuel Type

Controlled Coal: Emission rate < 0.15 lb/MMBtu or SCR or SNCRControlled Gas: Emission rate < 0.1 lb/Mmbtu for CC, < 0.2 lb/Mmbtu for CT,< 0.15 lb/Mmbtu for O/G SteamControlled Oil: Emission rate < 0.15 lb/MMBtu

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2020 Summer Season Uncontrolled Coal EGU NOx Emissions under CAIR/CAVR/CAVR; Adding Further Controls

Controlled Coal: Emission rate < 0.15 lb/MMBtu or SCR or SNCR

Level of NOx from Uncontrolled Coal Units under CAIR/CAMR/CAVR)Level of NOx when SCR is added to uncontrolled coal

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2020 Retrofits

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Projected 8-Hr Ozone (ppb) for 2020_070a1 Learning Strategy

291

50

36

19

17

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Number of CountiesLegend

< 70.5

>= 70.5 to 73.0

>= 73.0 to 75.0

>= 75.0 to 77.0

>= 77.0 to 79.0

>= 79.0 to 81.0

>= 81.0 to 83.0

>= 83.0 to 85.0

>= 85.0 to 88.0

>= 88.0

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2

2

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DRAFT: Deliberative. Do not Quote or CitePreliminary Results. Data still in final QA review.

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Other Impacts

• Cost of the policy

• Marginal cost

• Fuel prices

• Generation mix

• Wholesale electricity prices

• Retirements

*2025 numbers are highly tentative due to more uncertainty in future years.

For More Information:

www.epa.gov/airmarkets

www.epa.gov/airmarkets/epa-ipm

Kevin CulliganSerpil Kayin