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Carbon capture at center of debate over US EPA's rule for new coal plants

The feasibility of a technology known as carbon capture and storage has emerged as a central point of debate when discussing the U.S. Environmental Protection Agency's proposal to ease carbon dioxide limits on new and modified coal-fired power plants.

As part of the Trump administration's effort to repeal and replace the Obama-era Clean Power Plan, the EPA in December 2018 proposed to revise a companion regulation that effectively required new and modified coal plants to capture at least some of their planet-warming CO2 emissions.

Issued in 2015, the Obama-era rule concluded that partial carbon capture and storage, or CCS, technology was adequately demonstrated and set a limit of 1,400 pounds of CO2 per MWh for new and modified coal plants. The EPA's new proposal would raise the limit on large coal-fired generating units to 1,900 pounds of CO2 per MWh and smaller units to 2,000 pounds.

In doing so, the rule would also determine that the best system of CO2 emission reduction for new and modified coal-fired plants under the Clean Air Act is to adopt the same technology already installed at the most efficient modern plants without CCS. The rule does not anticipate any new coal-fired generation but suggested the situation could change in the event of "substantial shifts in energy prices."

Electric utility groups in March 18 written comments largely supported the EPA's revised approach, agreeing with the agency's assertion that high costs and geographic concerns make partial CCS unreasonable as a mandatory pollution control technology. However, environmental groups pointed to multiple examples where CCS technology has already been successfully deployed while arguing the EPA's proposal fails to incentivize innovation.

'Highly variable'

In the 2015 rule, the Obama EPA determined that new coal-fired generators with partial CCS could be broadly located with access to some form of geologic sequestration.

However, the Edison Electric Institute, or EEI, said it agreed with the EPA's revised conclusion that the deployment of partial CCS is "site-specific and its application will depend on local market and geologic conditions."

"The cost of deploying partial CCS will be highly variable on a geographic basis and further bolsters the agency's conclusion that partial CCS is not" the best system of emission reduction, EEI said. The investor-owned utility group specifically cited increased water scarcity issues potentially limiting or eliminating CCS implementation in arid climates.

The National Rural Electric Cooperative Association asserted that CCS cannot be implemented in many areas of the country that lack the necessary pipeline capacity to transport captured CO2. Under the 2015 rule's requirements, new coal plants would need to construct a connection to storage facilities, "which would take a considerable amount of time and cost a prohibitive amount of money," the group argued.

The American Public Power Association agreed that CCS "is a promising technology, but extremely costly and unproven thus making it inappropriate for nationwide utility application."

'A regulatory driver'

In contrast, environmental groups argued the case for requiring CCS technology has only grown stronger since 2015.

"Every year, China captures over 270 million tonnes of high-purity CO2 from plants that process coal into fertilizers, methanol, substitute natural
gas, and a variety of industrial chemicals," the Clean Air Task Force and Natural Resources Defense Council noted in joint comments. Assessing the U.S., the groups noted that at least 21 states have already enacted legislation related to CCS, specifically citing Montana's requirement that all new coal plants capture and sequester at least 50% of their CO2.

The groups also cited federal cost-cutting goals based in part on NRG Energy Inc.'s Petra Nova project in Fort Bend County, Texas, a coal-fired facility that captures 90% of its CO2 emissions and transports it via pipeline for enhanced oil recovery. Citing the project's success, the U.S. Department of Energy's Office of Fossil Energy aims to reduce the cost of CCS technology from $80 to $100 per ton in 2012 to $45 per ton by 2020.

"Basing the standard on CCS will provide a regulatory driver for continued innovation and cost declines — factors that EPA must take into account," the groups said.

In addition, the Sierra Club argued that the relatively high cost of CCS technology should not disqualify it as a pollution control technology. "All major pollution controls require additional expenditures to control and operate, but this does not — and, in the past, has not — exempt them from inclusion in regulatory requirements," the group said.