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EPA regulations force closure of power plants

World Coal,

The US Government Accountability Office (GAO) has found, through analysis of public data, that power companies are planning to retire a greater percentage of coal-fired power plants than previously reported in 2012.

The GOA’s study also shows these power companies, in the face of Environmental Protection Agency (EPA) regulations, are likely to retrofit less capacity with environmental controls than the estimates reported by the GOA.

The GOA, along with the EPA and Department of Energy (DOE), has monitored industry progress responding to EPA regulations, primarily focusing on one of four EPA regulations – the Mercury and Air Toxic Standards (MATS) – and the regions with a large amount of capacity that must comply with that regulation.

About 13% of coal-fired generating capacity – 42,192 MW – has either been retired since 2012 or is planned for retirement by 2025, which exceeds the estimates of 2 – 12% of capacity that GAO reported in 2012. The units that power companies have retired or plan to retire are generally older, smaller, more polluting and not used extensively, with some exceptions. For example, some larger generating units are also planned for retirement. In addition, the capacity is geographically concentrated in four states: Ohio (14%), Pennsylvania (11%), Kentucky (7%), and West Virginia (6%). GAO's analysis identified about 70,000 MW of generating capacity that has either completed some type of retrofit to reduce sulfur dioxide, nitrogen oxides, or particulate matter since 2012 or plan to complete one by 2025, which is less than the estimate of 102,000 MW GAO reported in 2012.

EPA recently proposed or finalised four regulations affecting coal-fired electricity generating units, which provide about 37% of the nation's electricity supply. These regulations are the: (1) Cross-State Air Pollution Rule; (2) Mercury and Air Toxics Standards; (3) Cooling Water Intake Structures regulation; and (4) Disposal of Coal Combustion Residuals regulation. In 2012, GAO reported that, in response to these regulations and other factors such as low natural gas prices, companies might retire or retrofit some units. GAO reported that these actions may increase electricity prices and, according to some stakeholders, may affect reliability–the ability to meet consumers' demand—in some regions. In 2012, GAO recommended that DOE, EPA, and FERC develop and document a formal, joint process to monitor industry's progress responding to these regulations. In June 2014, EPA proposed new regulations to reduce carbon dioxide emissions that will also affect these units.

GOA has now updated the 2012 report and, while it refrains from making new recommendations, has reiterated the importance of various US government agencies jointly monitoring industry progress – and that these agencies document these steps. 

Edited by Sam Dodson

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