ELECTRICITY GENERATION AND AIR QUALITY: MULTI-POLLUTANT STRATEGIES (CRS Report for Congress)
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| Release Date |
March 13, 2001 |
| Report Number |
RL30878 |
| Report Type |
Report |
| Authors |
Larry Parker and John E. Blodgett, Resources, Science, and Industry Division |
| Source Agency |
Congressional Research Service |
Summary:
Fossil fuel fired electric generating facilities are major sources of air pollutants, including particulate matter (PM), sulfur dioxide (SO2), nitrogen oxides (NOx), and mercury (Hg), and of the greenhouse gas carbon dioxide (CO2). A patchwork of regulations to limit PM, SO2, and NOx emissions exists, with further requirements on the horizon. The piecemeal nature of the regulations and the uncertainty of future requirements impose not only direct costs on utilities, but also make planning difficult in an environment already characterized by industry restructuring, volatile energy prices, and technological changes.
To bring some consistency and stability to the regulations affecting utility emissions, legislative initiatives have proposed a "multi-pollutant" strategy. Key elements of the strategy include:
aligning pollution control processes and procedures for PM, SO2, and NOx so that both regulators and utility managers could anticipate requirements and integrate their decisions about how to control emissions;
adopting efficient economic mechanismsâmost notably "cap and trade" strategiesâfor the control of the pollutants;
stabilizing requirements over time; and
incorporating potential future control requirements for other emitted gases (e.g., Hg, CO2) into this more stable scheme.
This approach to controlling powerplant emissions would have several tradeoffs. Overall, it exchanges regulatory and economic uncertainty for short to mid-term certainty. For the environment, the current controversy that accompanies the setting of standards and the implementing of regulatory reduction requirements would be exchanged for a specific reduction target that would not change for 10-15 years. From an economic standpoint, implementing emission caps through emission trading would reduce costs, and the straightforward enforcement mechanism would also provide industry with certainty with respect to their responsibilities and potential penalties, and allow industry to plan for the future in the context of a consistent regulatory regime. Finally, the program might open the door for simplifying or replacing elements of the current piecemeal requirements. However, cap and trade systems could conflict with health standards to protect local areas from "hot spot" emissions.
Although the Clean Air Act's evolution has resulted in a structure that some characterize as unwieldy, the number of persons living in areas where air pollution exceeds standards has diminished. Arguably, the Act's success puts the burden of proof concerning amendment on those favoring change. Amending the Act has always proved contentious; but for many, the opportunities for greater predictability of requirements, fixed emission reductions, and cost efficiency are enticing.
