The Impact of Greenhouse Gas Regulation on Energy Production: Legal Framework for Greenhouse Gases Standards for Fossil-Fuel Fired Electric Generating Units 2014 Utah Energy Development Summit June 4, 2014

Clean Air Act Section 111  Section 111(b) –Directs EPA to list any source category that “causes, or contributes significantly to, air pollution which may reasonably be anticipated to endanger public health welfare.” –Within a year of source category listing, EPA must propose “Federal standards of performance” for “new sources.” –New sources defined to include modified sources.

Clean Air Act Section 111  Section 111(d) –Directs EPA to issue “standards of performance for any existing source” in a listed NSPS category.  Excluding criteria pollutants  Excluding hazardous air pollutants (“HAP”)* –States must submit plans to EPA that implement the “standards of performance” based on EPA emissions guidelines.

Clean Air Act Section 111  Standard of Performance –“[S]tandard for emissions of air pollutants which reflects the degree of emission limitation achievable through the application of the best system of emission reduction which (taking into account the cost of achieving such reduction and any nonair quality health and environmental impact and energy requirements) the Administrator determines has been adequately demonstrated.”

Section 111 Standards of Performance Section 111(b)  EPA sets “standard of performance” applicable to all sources within the category. –Subcategorization –Technology forcing  National standard.  Effective upon promulgation. Section 111(d)  EPA sets the emission guidelines, which define the “best system of emission reduction” that has been “adequately demonstrated.”  EPA sets timeframes for compliance.  States develop standards applicable to the sources and submit plan to EPA. –States may consider “remaining useful life of the source.”

Existing Source Standards  EPA’s Application of Section 111(d) –Phosphate fertilizer plants (fluorides); sulfuric acid plants (acid mist); primary aluminum plants (fluorides); Kraft pulp plants (total reduced sulfur); municipal solid waste landfills (landfill gases); sources regulated under Section 129 of the CAA. –No precedent for regulating greenhouse gases.  No case law interpreting scope of EPA’s authority under Section 111(d) –But authority regarding EPA “standards of performance” under Section 111(b).

Section 111 Standards for Power Generation  Standards for fossil-fuel fired electric generating units (EGUs) –Listed source category since 1979 with NSPS issued for NOx and SO2. –NSPS for greenhouse gases emitted from EGUs.  2012 Proposed Rule  January 2014 withdrawal of 2012 proposal and reproposal of NSPS –Existing source and modified/reconstructed source proposals issued June 2, 2014.

Thank you! Emily C. Schilling Holland & Hart LLP 975 F Street NW, Suite 900 Washington, D.C (202)