1. State Initiatives for Reducing Power Plant Pollution Martha H. Keating Clean Air Task Force NC DAQ Mercury and CO 2 Workshop Raleigh, NC April 20, 2004

2. States are Taking Control of Mercury Wait and see what EPA is going to do: not good enough for 14 states. Some are moving ahead with mercury-specific state regulation. Others have co-benefit pollutant approach developed by state environmental departments. Legislative actions on the table in other states. Voluntary program Regulation by permit

3. Final and Proposed Mercury-Specific Rules CT - 2003 Final rule WI - 2003 Proposed rule MA - 2003 Proposed rule NJ - 2004 Proposed rule

6. Co-Control Approach Taking advantage of NOx and SOx co-control: mercury reduction without even trying. North Carolina - 2002 Clean Smokestacks Bill (estimated 65% Hg co-benefit). May recommend Hg specific controls in 2005. New Hampshire - 2002 Clean Power Act. Mercury cap will be recommended to legislature by DES in 2004.

7. Legislative Activity DE - bill introduced to cut Hg by 90% - also covers NOx and SOx - similar to NC. IL EPA to recommend limits in Spring 2004. MI DEQ working with task force to develop a mercury reduction plan in 2004.

8. Still Trying MN - Voluntary plan passed by legislature in 1999 recommending that utilities voluntarily reduce Hg emissions. A 2001 progress report showed no emissions have been reduced. MD - bill (similar to NC) introduced in 2003 but withdrawn. OH - legislation introduced in 2002 but didnt make it out of committee. Will be re-introduced. NY - Several bills introduced in past legislative sessions have not made it out of committee.

9. New Source Permits Since coal-fired utility units are now on the source category list (although EPA is trying to delist them), they are subject to CAA section 112(g) (Modifications) and 112(j) (the permit hammer). New or modified sources are subject to case-by-case MACT determination. Most states are only looking at co-benefits of criteria pollutant controls as MACT. Virtually all of these are being challenged in court. Iowa has stepped up and negotiated a permit requirement for a new coal-fired facility that will achieve at least an 83% reduction in Hg emissions through the use of activated carbon injection. Plant will come on-line in 2007.

10. Keys to Success Buy-in from affected companies. Identification of and compromise on make or break issues. Examples: –Connecticut –Wisconsin –Massachusetts and New Jersey