The U.S. Environmental Protection Agency's long-expected Mercury and Air Toxics Standards for power plants, due out Dec. 16 with possible delay to Dec. 19, are expected to contribute to the closure of several old coal-fired power plants across the state by 2015.
"This is the EPA rule that will impact some of our older units, some of our marginal units, that will have to shut down as a result," said Appalachian Power Co. President and Chief Operating Officer Charles Patton Dec. 6 at the Governor's Energy Summit.
The MATS rule — also known as the Hazardous Air Pollutants rule for utilities and the Utility Maximum Available Control Technology rule — establishes the first national standards to limit toxic air emissions from power plants: mainly mercury, fine particulates and acid gases.
Costs and Benefits
Mercury is a neurotoxin to which fetuses and children are particularly susceptible, while other targeted emissions cause cancer, chronic and acute respiratory disorders, and other illnesses.
The rule will require expensive upgrades to or installations of new emissions controls by Jan. 1, 2015, at an estimated 1,200 coal-fired units and 150 oil-fired units at 525 power plants.
When the agency issued its proposed rule in March, it estimated the 2016 cost of compliance at $10.9 billion. The 2016 benefits — realized primarily through 6,800 to 17,000 premature deaths avoided but also through the avoidance of 11,000 non-fatal heart attacks, more than 300,000 cases of respiratory illness including aggravated asthma and acute and chronic bronchitis, and 850,000 days of missed work — came to $59 billion to $140 billion.
Implications for W.Va.
In West Virginia, AEP has said it would shut down Appalachian Power Co.'s 1,105-MW Philip Sporn plant in Mason County and 439-MW Kanawha River plant in Kanawha County, along with Ohio Power Co.'s 713-MW Kammer plant in Marshall County. The plants represent more than 2,200 megawatts of coal-fired generating capacity in the state and about 240 jobs.
They accounted for about 7 percent of coal burned for power in the state in 2010 — not all of which is West Virginia coal. However, because they are old and inefficient, they accounted for only about one-tenth of one percent of West Virginia generation, according to the Energy Information Administration.
Asked whether these old plants wouldn't be closing anyway, Appalachian Power Co. spokeswoman Jeri Matheney said they would, but not all together and so quickly.
FirstEnergy has not yet indicated which of its plants might be affected and did not respond to a request in time for this story.
A state regulator has suggested FirstEnergy's Albright, Rivesville and Willow Island plants — older, smaller plants without pollution controls — as likely candidates for retirement. Those plants accounted for less than one-tenth of a percent of the state's generation in 2010 and about 1 percent of coal burned.
Too Much, Too Soon?
Utilities and others responsible for electric grid reliability are arguing that the three-year schedule, with some flexibility to a fourth year, could compromise reliability.
"The number of potential retirements and retrofits, and the tight timeframe associated with same, could be unprecedented in scope," regional grid manager PJM Interconnection's Senior Vice President of Operations Michael Kormos testified before the Federal Energy Regulatory Commission in November.
Of the 78,600 megawatts of coal-fired capacity in PJM's 13-state territory, up to 20,000 megawatts — more than 10 percent of all PJM generating capacity — is at risk for near-term retirement, according to an October PJM presentation.
Grid managers nationwide want more compliance flexibility for utilities, Kormos argued, in case a plant scheduled for retirement is needed a while longer for reliability.
AEP is making the case for more time to comply for several reasons, according to Matheney.
"More time will allow us to install environmental retrofits, where we plan to do so, with minimal idling or derating of generating units," Matheney said, and "a more reasonable timeframe will let us address any potential transmission solutions, which could be needed to minimize grid reliability issues."
A longer compliance timeline would allow utilities to line up permitting and regulatory approvals as well as materials and qualified labor, she added.
And it would enable smoother employee transitions.
Legislative Pushback
The rule is targeted by the Fair Compliance Act, S. 1833, introduced in the U.S. Senate Nov. 9 by West Virginia Democratic Sen. Joe Manchin and Indiana Republican Sen. Dan Coats.
The bill would extend the compliance deadlines for the EPA's Cross-State Air Pollution Rule by three years and the Utility MACT rule by two years, putting both on Jan. 1, 2017.
As of Nov. 14, the Environment and Public Works committee had not scheduled the bill for a hearing.
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