Friday, June 8, 2012

IJC on Natural Resources

Below is a press release from LRC in regards to Thursday's Natural Resources Committee meeting. A copy of the slide presentation can be accessed HERE.



For Immediate Release
June 7, 2012


State legislative panel considers effect of new EPA rule

FRANKFORT-- A new Environmental Protection Agency rule regulating greenhouse gas emissions favors natural gas over coal for electricity generation, a state Air Quality official told state lawmakers today.

Division of Air Quality Director John Lyons told the Interim Joint Committee on Natural Resources and the Environment that the recently proposed and published Greenhouse Gas New Source Performance Standards (NSPS) rule, which was proposed and took effect in April 2012, will not apply to certain natural gas fired turbines but will apply to future small (73 megawatt base load rating) coal-fired plants that were not permitted or built prior to April 13.

The emission standard under the rule, Lyons said, limits carbon dioxide to 1,000 pounds of carbon dioxide per megawatt hour gross output annually.

"You might ask, 'What does that mean?' To give you an idea of what some current facilities emit in terms of CO2, a super critical coal fired generator such as the Trimble 2 unit (in Trimble County, KY) ,which is one of the cleanest units in the nation, puts out about 1,800 pounds of CO2," he said.

Lyons said a simple cycle natural gas fired turbine emits about 1,300 pounds of CO2 per megawatt hour gross output a year, while a combined cycle natural gas fired unit emits around 750 pounds per megawatt hour of the greenhouse gas.

"The only technology that really falls under 1,000 pounds of CO2 per megawatt hour is a combined cycle natural-gas fired turbine," he said.

The rule does give some leeway to coal-fired electricity generation at new units that can meet the average 1,000 pound CO2 emission standard over a 30-year period, Lyons explained.  Lyons said the 30-year standard is a kind of "out, if you will" for coal-fired power plants, although he said meeting that standard would require reliance on technologies like carbon capture and storage that is not what he called "a proven technology".

Committee Co-Chair Rep. Jim Gooch, D-Providence, said he recently heard a federal official say natural gas is going to be "the standard" in power generation in the future. 

"His comments went on to say if you're wanting to build a coal-fired power plant, you've got major problems," Gooch said.

"We're the ones who are going to pay the consequences for this decision," Gooch said.

When asked by Rep. John Will Stacy, D-West Liberty, what the "tipping point" is in deciding to switch from coal to natural gas, Lyons commented that EPA rules like the one published April 13 could play a part. 

"At this point in time, it's as cheap to use natural gas as coal because of the price of natural gas.  But,… I think it's driven more by what the rules are and what you've got to meet in terms of pollution output, is what really the tipping point is rather than the equipment and whatnot," said Lyons.  "That's something I can investigate..."

Also, Lyons said electric utilities are asking themselves whether it is smarter to retrofit aging coal-fired power plants or build new plants.  Utilities are asking "'does it make sense to retrofit a 60-year old plant, rather than build a new plant which at this point in time is going to be natural gas fired unit with all the factors involved?'" Lyons said.

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