Air Quality: Multi-Pollutant Legislation in the 108th Congress

Air Quality: Multi-Pollutant Legislation in the 108th Congress

Order Code RL31779
CRS Report for Congress
Received through the CRS Web
Air Quality:
Multi-Pollutant Legislation
in the 108th Congress

Updated November 17, 2003
Larry Parker
Specialist in Energy Policy
Resources, Science, and Industry Division
John Blodgett
Specialist in Environmental Policy
Resources, Science, and Industry Division
Congressional Research Service ˜ The Library of Congress

Air Quality: Multi-Pollutant Legislation
in the 108th Congress
Summary
With the prospect of new layers of complexity being added to air pollution
controls and with electricity restructuring putting a premium on economic efficiency,
interest is being expressed in finding mechanisms to achieve health and
environmental goals in simpler, more cost-effective ways. The electric utility
industry is a major source of air pollution, particularly sulfur dioxide (SO ), nitrogen
2
oxides (NOx), and mercury (Hg), as well as suspected greenhouse gases, particularly
carbon dioxide (CO ). At issue is whether a new approach to environmental
2
protection could achieve the Nation’s air quality goals more cost-effectively than the
current system.
One approach being proposed is a “multi-pollutant” strategy – a framework
based on a consistent set of emissions caps, implemented through emissions trading.
Just how the proposed approach would fit with the current (and proposed) diverse
regulatory regimes remains to be worked out; they might be replaced to the greatest
extent feasible, or they might be overlaid by the framework of emissions caps.
In February 2002, the Bush Administration announced two air quality initiatives.
The first, “Clear Skies,” would amend the Clean Air Act to place emission caps on
electric utility emissions of SO , NOx, and Hg. Implemented through a tradeable
2
allowance program, the emissions caps would generally be imposed in two phases:
2008 and 2018. The second initiative begins a voluntary greenhouse gas reduction
program. This plan, rather than capping CO emissions, focuses on improving the
2
carbon efficiency of the economy, reducing current emissions of 183 metric tons per
million dollars of GDP to 151 metric tons per million dollars of GDP in 2012.
In the 108th Congress, eight bills have been introduced that would impose multi-
pollutant controls on utilities. Two of the bills, H.R. 999/S. 485, are the
Administration’s three-pollutant proposal, and two other bills, H.R. 203 and S. 1844,
are modified versions of the Administration’s proposal. The other four bills are four-
pollutant proposals that include carbon dioxide. S. 366, is similar to a bill reported
by the Senate Environment and Public Works Committee in the 107th Congress while
S. 843 and H.R. 3093 are modified versions of S. 3135 introduced in the 107th
Congress . Likewise, H.R. 2042 is similar to H.R. 1256 introduced in the 107th
Congress. All of these bills involve some form of emission caps, typically taking
place in 2008-2009; and most include a tradeable credit program to implement that
cap. The provisions concerning SO , NOx, and Hg in S. 366, H.R. 203, S. 843, H.R.
2
2042, and H.R. 3093 are generally more stringent and take effect earlier than the
comparable provisions of H.R. 999/S. 485 and S. 1844. S. 366, S. 843, H.R. 2042,
and H.R. 3093 would cap emissions of CO . It is difficult to compare those CO caps
2
2
to the Administration’s proposal concerning CO – both because the Administration’s
2
proposal is voluntary rather than mandatory and because it is broader (covering all
greenhouse gas emissions rather than just utility CO emissions). However, it
2
appears that actual U.S. greenhouse gas emissions would be higher under the
Administration’s proposal than those allowed by these bills. This report will be
updated as warranted.

Contents
Introduction . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
The Bush Administration’s Proposals . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
Proposed Legislation and Legislative Action in the 108th Congress . . . . . . . 3
SO , NOx, and Hg Controls . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
2
Related Regulatory Provisions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
CO . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
2
List of Tables
Table 1: Emissions From U.S. Fossil-fuel Electric Generating Plants . . . . . . . . . 1
Table 2: Comparison of Administration’s Voluntary Program with Proposed
Legislation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6
Appendix 1: Comparison of Multi-Pollutant Control Proposals . . . . . . . . . . . . . 7

Air Quality: Multi-Pollutant Legislation
in the 108th Congress
Introduction
Electric utility generating facilities are a major source of air pollution. The
combustion of fossil fuels (petroleum, natural gas, and coal), which accounts for 67%
of U.S. electricity generation, results in the emission of a stream of gases. These
gases include several pollutants that directly pose risks to human health and welfare,
including particulate matter (PM),1 sulfur dioxide (SO ), nitrogen oxides (NOx), and
2
mercury (Hg). Particulate matter, SO and NOx are currently regulated under the
2
Clean Air Act (CAA), and the Environmental Protection Agency (EPA) has
announced its intention to regulate mercury. Other gases may pose indirect risks,
notably carbon dioxide (CO ), which may contribute to global warming.2 Table 1
2
provides estimates of SO , NOx, and CO emissions from electric generating
2
2
facilities. Annual emissions of Hg from utility facilities are more uncertain; current
estimates indicate about 48 tons. Utilities are subject to an array of environmental
regulations, which affect in different ways both the cost of operating existing
generating facilities and of constructing new ones.
Table 1: Emissions From U.S. Fossil-fuel Electric Generating Plants
(thousands of short tons)
Emissions
1994
1995
1996
1997
1998
1999
SO
14,211
11,437
12,053
12,317
12,432
11,968
2
NOx
6,790
6,737
6,996
7,227
7,221
7,051
CO
1,986,079
1,995,471
2,065,339
2,142,118
2,209,286
2,191,576
2
Source: Energy Information Administration, Electric Power Annual 1999, vol. II, p. 40
1 Particulate matter is regulated depending on the particle size; current regulations address
particles less than 10 microns in diameter (PM ); EPA has promulgated regulations for
10
particles less than 2.5 microns in diameter (PM ) which have not yet been implemented.
2.5
SO and NOx emissions could be affected by regulations of PM . Current concerns about
2
2.5
emissions from fossil-fuel electric generating plants do not explicitly address PM, but could
indirectly do so through attention to SO and NOx.
2
2 Steam-electric utilities produce minor amounts of volatile organic compounds (VOCs),
carbon monoxide (CO), and lead — on the order of 2% or less of all sources.

CRS-2
The evolution of air pollution controls over time and as a result of growing
scientific understanding of health and environmental impacts has led to a
multilayered and interlocking patchwork of controls. Moreover, additional controls
are in the process of development, particularly with respect to NOx as a precursor to
ozone, to both NOx and SO as contributors to PM , and to Hg as a toxic air
2
2.5
pollutant. Also, under the United Nations Framework Convention on Climate
Change (UNFCCC), the United States agreed to voluntary limits on CO emissions.
2
The current Bush Administration has rejected the Kyoto Protocol, which would
impose mandatory limits, in favor of a voluntary reduction program. Thus,
mandatory federal CO controls in the United States appear unlikely in the near term.
2
For many years the complexity of the air quality control regime has caused some
observers to call for a simplified approach. Now, with the potential both for
additional control programs on SO and NOx and for new controls directed at Hg and
2
CO intersecting with the technological and policy changes affecting the electric
2
utility industry, such calls for simplification have become more numerous and
insistent. One focus of this effort is the “multi-pollutant” or “four pollutant”
approach. This approach involves a mix of regulatory and economic mechanisms
that would apply to utility emissions of up to four pollutants in various proposals –
SO , NOx, Hg, and CO . The objective would be to balance the environmental goal
2
2
of effective controls across the pollutants covered with the industry goal of a stable
regulatory regime for a period of years.3
The Bush Administration’s Proposals
In February 2002, the Bush Administration announced two air quality proposals
to address the control of emissions of SO , NOx, Hg, and CO .4 The first proposal,
2
2
called “Clear Skies,” would amend the Clean Air Act to place emission caps on
electric utility emissions of SO , NOx, and Hg. Implemented through a tradeable
2
allowance program, the emissions caps would be imposed in two phases: 2010 (2008
in the case of NOx) and 2018. As part of a complete rewrite of Title IV of the Clean
Air Act, it was introduced in the 108th Congress on February 27, 2003 as H.R. 999
and S. 485.
The second proposal (for which no legislation has been introduced) initiates a
new voluntary greenhouse gas reduction program, similar to ones introduced by the
earlier George H. W. Bush and Clinton Administrations.5 Developed in response to
the U.S. ratification of the 1992 UNFCCC, these previous plans projected U.S.
compliance, or near compliance, with the UNFCCC goal of stabilizing greenhouse
3 Larry Parker and John Blodgett, Electricity Generation and Air Quality: Multi-pollutant
Strategies, CRS Report RL30878.
4 Papers outlining the Administration’s proposals are available from the White House web
site: [http://www.whitehouse.gov/news/releases/2002/02/clearskies.html] for the three
pollutant proposal and, for the climate change initiative:
[http://www.whitehouse.gov/news/releases/2002/02/climatechange.html].
5 For a discussion of those previous plans, see Larry Parker and John Blodgett, Climate
Change Action Plans, CRS Report 94-404 ENR, May 9, 1994. (archived, available from the
author)

CRS-3
gas emissions at their 1990 levels by the year 2000 through voluntary measures. The
new proposal introduced by the Bush Administration does not make that claim, only
projecting a 100 million metric ton reduction in emissions from what would occur
otherwise in the year 2012. Instead, the plan focuses on improving the carbon
efficiency of the economy, reducing current emissions of 183 metric tons per million
dollars of GDP to 151 metric tons per million dollars of GDP in 2012. It proposes
several voluntary initiatives, along with increased spending and tax incentives, to
achieve this goal. The Administration notes that the new initiatives would achieve
about one-quarter of the objective, while three-quarters of the projected reduction
would occur through already existing efforts underway.
Proposed Legislation and Legislative Action in the 108th
Congress
In the 108th Congress, eight bills have been introduced that would impose multi-
pollutant controls on utilities. Two of the bills, H.R. 999, introduced by request by
Representative Barton, and S. 485, introduced by request by Senator Inhofe, are the
Administration’s three-pollutant proposal. Two other bills are modified versions of
the Administration’s Clear Skies proposal. H.R. 203, introduced by Representative
Sweeney, is a shortened and more stringent version of the Administration’s proposal,
while S. 1844, introduced by Senator Inhofe, would maintain the deadlines contained
in Clear Skies and includes provisions that, among other things, would weaken the
phase 1 Hg cap and exempt co-generation facilities from the bill’s mandates. The
other four bills are four-pollutant proposals that include carbon dioxide. S. 366,
introduced by Senator Jeffords, is basically the same as S. 556 as reported by the
Senate Environment and Public Works Committee during the 107th Congress (S.Rept.
107-347).6 S. 843, introduced by Senator Carper, and H.R. 3093, introduced by
Representative Bass, are similar to S. 3135 introduced in the 107th Congress. H.R.
2042, introduced by Representative Waxman, is similar to H.R. 1256 introduced in
the 107th Congress. All of these bills involve some form of emission caps, typically
taking place (at least initially) in 2008-2009; and most include a tradeable credit
program to implement that cap. S. 366, S. 843, H.R. 2042, and H.R. 3093 would cap
emissions of CO .
2
The eight bills are summarized in Appendix 1. Each of these bills builds on the
SO allowance trading scheme contained in title IV of the 1990 Clean Air Act
2
Amendments (CAAA).7 Under this program utilities are given a specific allocation
of permitted emissions (called allowances) and may choose to use those allowances
at their own facilities, or, if they do not use their full quota, to bank them for future
use or to sell them to other utilities needing additional allowances.
SO , NOx, and Hg Controls.
As indicated in Appendix 1, for SO and
2
2
NOx, the caps in H.R. 999/S. 485 and S. 1844 are less stringent for 2008 than S.
366's or H.R. 2042's requirements for 2009 or H.R. 203's requirements for 2012; and
6 The primary difference is S. 366 compliance deadlines for its reduction requirements have
been extended one year to 2009 (except for Hg which remains at 2008).
7 Public Law 101-549.

CRS-4
remain less stringent than S. 366 or H.R. 2042 even through the second phase
beginning in 2018. H.R. 203 would require full compliance with its SO and NOx
2
provisions by 2012, in effect accelerating the Administration’s proposed emission
caps by 6 years. For S. 843 and H.R. 3093, their NOx caps are initially more stringent
than the Administration’s proposal and S. 1844 but are achieved a year later, while
its final NOx cap is the same as the Administration’s proposal and S. 1844 but
achieved 5 years earlier. S. 843's and H.R. 3093's SO cap is initially the same as
2
Clear Skies and S. 1844 but achieved a year earlier and its final cap is more stringent
and achieved 2 years earlier.
Allowance allocation schemes for the bills also differ, with S. 366 containing
detailed provisions for allocating SO , NOx (and CO ) allowances to various
2
2
economic sectors and interests. In most cases, these interests (or their trustees in the
case of households and dislocated workers and communities) would auction off (or
otherwise sell) their allowances to the affected utilities, and use the collected funds
for their own purposes. In contrast, the Administration’s proposal initially allocates
SO , NOx and Hg allowances to affected sources free, with a small percentage sold
2
at auction. Over time, an increasing percentage of the allocation is sold at auction
with affected sources receiving fewer allowances free. S. 843 and H.R. 3093 allocate
NOx, Hg, and CO allowances based on a powerplant’s generating efficiency and its
2
SO allowances based on current formulas within title IV of the 1990 Clean Air Act
2
Amendments. S. 1844 bases its allowance formulas on fuel usage adjusted by factors
specified in the bill while H.R. 203 and H.R. 2042 leaves the allocation issue to EPA.
On mercury, H.R. 999/S. 485 and S. 1844's emissions goal allows about 3 times
more emissions and ten additional years for compliance than allowed by S. 366,
which also mandates plant-by-plant controls; H.R. 2042 is likewise three times more
stringent than H.R. 999/S485 and S. 1844, mandates plant-by-plant controls, and has
a compliance deadline 9 years in advance of the Administration’s bill. H.R. 999/S.
485 is also less stringent than S. 843 and H.R. 3093. H.R. 203 requires EPA to
promulgate Hg regulations before 2005. (It is difficult to compare the Hg controls of
the Administration’s proposal, S. 366, or H.R. 2042 to H.R. 203, which does not
specify an Hg emissions goal, leaving regulation up to EPA).
Related Regulatory Provisions. In addition to the emissions caps, H.R.
999/S. 485 and S. 1844 would substantially modify or eliminate several provisions
in the Clean Air Act with respect to electric generating facilities. The bills would
eliminate New Source Performance Standards (NSPS) (Section 111) and replace
them with statutory standards for SO , NOx, particulate matter, and Hg for new
2
sources. Modified sources could also opt to comply with these new statutory
standards and be exempted from the applicable Best Available Control Technology
(BACT) determinations under Prevention of Significant Deterioration (PSD)
provisions (CAA, Part C) or Lowest Achievable Emissions Rate (LAER)
determinations under non-attainment provisions (CAA, Part D). Compliance with
these provisions exempts such facilities from New Source Review (NSR), PSD-
BACT requirements, visibility (Best Available Retrofit Technology) BART
requirements, Maximum Achievable Control Technology (MACT) requirements for
Hg, and non-attainment LAER requirements. The exemption does not apply to PSD-
BACT requirements if facilities are within 50 km of a PSD Class 1 area. Existing
sources can also receive these exemptions if they agree to meet a particulate matter

CRS-5
standard specified in the bill along with good combustion practices to minimize
carbon monoxide emissions within 3 years of enactment. S. 843 and H.R. 3093
would restrict NSR to new facilities (including replacing an existing boiler) and
projects that result in increased hourly emissions of regulated pollutants. For pre-
1971 generating facilities, S. 843 and H.R. 3093 would impose SO and NOx
2
performance standards beginning in 2020. In contrast, S. 366 requires all
powerplants 40-years or older to meet emission limitations based on current best
available control technology for a new source.
H.R. 999/S. 485 and S. 1844 also include an exemption for steam electric
generating facilities from Hg regulation under Section 112 of the CAA (including the
residual risk provisions), and relief from enforcement of any Section 126 petition
(with respect to reducing interstate transportation of pollution) before 2012 (2014 in
the case of S. 1844). S. 843 and H.R. 3093 provides for removal of Hg MACT
provisions for electric generating facilities, but requires EPA to carry out its
responsibilities under the residual risk provisions of the CAA within 8 years of
enactment.
Neither H.R. 203, S. 366, nor H.R. 2042 provide such regulatory relief
provisions.
CO . Of the eight bills, S. 366, S. 843, H.R. 2042, H.R. 3093 specify CO
2
2
reductions. In contrast, the Administration’s CO proposal relies on various
2
voluntary programs and incentives to encourage reductions in greenhouse gases from
diverse sources, including CO emissions from electric generation.
2
Based on the estimate provided by the Administration’s climate change
proposal, and using the 2002 Climate Action Report8 (CAR) for projections to 2010,
table 2 presents estimates of U.S. greenhouse gas emissions in 2010, assuming the
Administration’s voluntary program reaches its goals.9 This should not be taken as
a given, as neither the George H. W. Bush Administration’s program nor the Clinton
Administration’s program achieved their stated goals. Thus, in one sense, comparing
a mandatory reduction program, such as that proposed by S. 366, S. 843, H.R. 2042,
and H.R. 3093 with the Administration’s voluntary program is comparing apples to
oranges. The first is legally binding, the second is an exhortation.

While S. 366, S. 843, H.R. 2042, and H.R. 3093 focus on electric utility
emissions, their mandated reductions would result in lower total greenhouse gas
emissions in 2010 than those projected to occur under the Administration’s initiative
that includes all sources of all greenhouse gases.10 However, neither S. 366, S. 843,
8 This is the U.S. report to the UNFCCC Secretariat on U.S. emissions and measures taken
to reduce them. The Climate Action Report -- 2002, available at:
http://www.epa.gov/globalwarming/publications/car/index.html
9 For a discussion of emission projections and trends, see John Blodgett and Larry Parker,
Global Climate Change: U.S. Greenhouse Gas Emissions – Status, Trends, and Projections,
CRS Report 9-235 ENR.
10 The assessment assumes that the Administration’s proposal actually achieves its goal in
(continued...)

CRS-6
H.R. 2042, H.R. 3093, nor the Administration’s initiative would be sufficient to bring
U.S. emissions near the level committed to in the 1992 UNFCCC.
Discussion in the CAR observes that the pace of economic growth would affect
emissions. A high economic growth scenario would increase energy use and related
carbon emissions, compared to reference case of “business as usual”; likewise, lower
economic growth would decrease emissions. For example, under a high economic
growth scenario, greenhouse emissions in 2010 would increase 37.7% above those
in 1990, based on energy growth alone. This increase would represent an additional
53 million metric tons of emissions.11 However, S. 366 would cap emissions from
increased electricity generation at 1990 levels, which would reduce the 53 million
metric tons by 16 million metric tons, or 30% of the high growth increase. The
Administration’s initiative is voluntary and addresses carbon intensity, not absolute
emission levels; it does not cap emissions growth.
Table 2: Comparison of Administration’s Voluntary Program
with Proposed Legislation
Percentage Change v.
Percentage Change v.
Business as Usual (2010)
1990 levels per UNFCCC
S. 366
-7.5%
+24.2%
S. 843 and H.R. 3093*
-5.1%
+27.5%
H.R. 2042
-9.5%
+21.7%
Administration’s
-4.4 to -4.5%
+28.3%
Voluntary Program**
Business as Usual
0
+34.4%
*Assumes requirement of S. 843 and H.R. 3093 is achieved in 2010, rather than 2013.
**Assumes goal of the Administration’s voluntary program is achieved in 2010, rather than
2012.
Source: CRS calculations based on projections contained in 2002 CAR.
10 (...continued)
2010, rather than 2012.
11 Energy Information Administration, Annual Energy Outlook 2000, Washington D.C.,
DOE/EIA-0383 (2002), December 2001. p. 177.

CRS-7

Appendix 1: Comparison of Multi-Pollutant Control Proposals

H.R. 999/S. 485
H.R. 203
(Administration’s
H.R. 2042
H.R. 3093
S. 1844
Provisions
(Sweeney)
S. 366 (Jeffords)
Proposals)
S. 843 (Carper)
(Waxman)
(Bass)
(Inhofe)
Emissions
2.1 million
1.51 million tons
2.1 million tons in
1.87 million tons
estimated at 1.5
1.87 million tons
2.1 million tons in
Cap on NOx
tons in 2008,
in 2009
2008, declining to
in 2009, declining
million tons in
in 2009, declining
2008, declining to
declining to
1.7 million tons in
to 1.7 million tons
2009
to 1.7 million tons
1.7 million tons in
1.7 million
2018
in 2013
in 2013
2018
tons in 2012
Emissions
4.45 million
2.25 million tons
4.5 million tons in
4.5 million tons in
2.23 million
4.5 million tons in
4.5 million tons in
Cap on SO
tons in 2008,
in 2009
2010, declining to
2009, declining to
tons in 2009
2009, declining to
2010, declining to
2
declining to
3.0 million tons in
2.25 million tons
2.25 million tons
3.0 million tons in
3.0 million
2018
in 2016
in 2016
2018
tons in 2012
Emission Cap
not covered
2.05 billion tons
none, program is
estimated at 2.6
estimated at
estimated at 2.6
none
on CO
in 2009
voluntary
billion tons in
1.937 billion
billion tons in
2
2009, declining to
tons in 2009
2009, declining to
an estimated 2.3
an estimated 2.3
billion tons in 2013
billion tons in
2013
Emissions
EPA to
5 tons in 2008
26 tons in 2010,
24 tons in 2009,
estimated at 4-5
24 tons in 2009,
34 tons in 2010,
Cap on
promulgate
declining to 15 tons
declining to 10
tons in 2009
declining to 10
declining to 15 tons
Mercury
regulations by
in 2018
tons by 2013
tons by 2013
in 2018
December 15,
2004
Scope
50 states and
50 states and DC
50 states, DC, and
50 states and DC
50 states and
50 states and DC
50 states, DC, and
DC
territories
DC
territories

CRS-8

H.R. 999/S. 485
H.R. 203
(Administration’s
H.R. 2042
H.R. 3093
S. 1844
Provisions
(Sweeney)
S. 366 (Jeffords)
Proposals)
S. 843 (Carper)
(Waxman)
(Bass)
(Inhofe)
Affected Units
electric
electric
for SO , NOx, and
fossil fuel-fired
electric
fossil fuel-fired
existing electric
2
generating
generating
Hg: existing electric
electric generating
generating
electric generating
generating facilities
facilities 25
facilities 15 Mw
generating facilities
facilities greater
facilities 15
facilities greater
25 Mw or greater
Mw or greater;
or greater (coal-
25 Mw or greater
than 25 Mw (coal-
Mw or greater
than 25 Mw (coal-
(coal-fired only for
Hg regulations
fired only for Hg)
(coal-fired only for
fired facilities in
fired facilities in
Hg); co-generation
to include
Hg); new facilities
the case of Hg
the case of Hg
sources exempted
industrial
have no size
controls)
controls)
sources
minimum (except
for natural gas
units); voluntary
CO program is
2
economy-wide
Penalties for
NOx: $6,000
NOx , SO and
NOx, SO , Hg:
NOx: $5,000 per
determined by
NOx: $5,000 per
NOx, SO , Hg:
2
2
2
non-
per excess ton
CO same as
reduces the excess
ton plus one-for-
EPA
ton plus one-for-
reduces the excess
2
compliance
plus one-for-
CAA, title IV
emissions penalties
one offset from
one offset from
emissions penalties
one offset from
except excess
under CAA, title
future emission
future emission
under CAA, title
future emission
emission penalty
IV to the EPA
allocations
allocations
IV to the EPA
allocations
is three times the
auction clearing
auction clearing
average market
price for allowances
SO : same as CAA,
SO : same as
price for allowances
2
2
SO : same as
price for
plus one-for-one
title IV
CAA, title IV
plus one-for-one
2
CAA, title IV
allowances
offset from future
offset from future
emission
Hg: $10,000 per
Hg: $10,000 per
emission
Hg: not
Hg: three times
allocations, if paid
lb. plus one-for-
lb. plus one-for-
allocations, if paid
specified, CAA
the average Hg
within 30 days.
one offset from
one offset from
within 30 days.
enforcement
control costs per
Otherwise, penalty
future emission
future emission
Otherwise, penalty
provisions
gram of excess
is three times the
allocations
allocations
is three times the
would apply
emission
clearing price plus
clearing price plus
offsets
CO : $100 per ton
CO : $100 per ton
offsets
2
2
plus one-for-one
plus one-for-one
CO : none –
offset from future
offset from future
2
voluntary program
emission
emission
allocations
allocations

CRS-9

H.R. 999/S. 485
H.R. 203
(Administration’s
H.R. 2042
H.R. 3093
S. 1844
Provisions
(Sweeney)
S. 366 (Jeffords)
Proposals)
S. 843 (Carper)
(Waxman)
(Bass)
(Inhofe)
Special
EPA to
beginning in
new performance
tonnage limitations
all powerplants
tonnage limitations
new performance
Provisions
determine by
2014, all
standards for new
in effect for 20
30-years or
in effect for 20
standards for new
2012 whether
powerplants 40-
sources replace
years; EPA to
older must
years; EPA to
sources replace
emission
years or older
current NSPS for
reassess after 15
meet current
reassess after 15
current NSPS for
reductions
must meet
new sources.
years
New Source
years
new sources.
sufficient to
emission
Compliance with
Performance
Compliance with
protect
limitations based
bill’s provisions
CO limitations
Standard
CO limitations
bill’s provisions
2
2
sensitive
on current best
exempts facilities
include provisions
(NSPS)
include provisions
exempts facilities
regional
available control
from New Source
providing CO
requirements
providing CO
from New Source
2
2
ecosystems; if
technology for a
Review (NSR),
allowances for
allowances for
Review (NSR),
not, EPA must
new major source
PSD-BACT
renewable energy,
renewable energy,
PSD-BACT
promulgate
requirements,
sequestration, and
sequestration, and
requirements,
rules requiring
SO cap divided
visibility BART
other greenhouse
other greenhouse
visibility BART
2
additional NOx
by region (West
requirements, and
gas emission
gas emission
requirements, and
and SO
and East) with no
non-attainment
reduction projects
reduction projects
non-attainment
2
reductions
trading permit
LAER
LAER
within two
between regions
requirements. The
revises New
revises New
requirements. The
years of such
exemption does not
Source Review
Source Review
exemption does not
determination
EPA to determine
apply to PSD-
(NSR) to cover
(NSR) to cover
apply to PSD-
by 2012 whether
BACT requirements
new units; and
new units; and
BACT requirements
emission
if facility is within
imposes new SO
imposes new SO
if facility is within
2
2
reductions
50 Km of Class 1
and NOx
and NOx
50 Km of Class 1
sufficient to
area. Existing
standards on pre-
standards on pre-
area. Existing
protect sensitive
sources can opt in
1971 units
1971 units
sources can opt in
regional
by meeting a
beginning in 2020;
beginning in 2020;
by meeting a
ecosystems; if
particulate standard
in 2009, a cost
in 2009, a cost
particulate standard
not, EPA must
threshold is
threshold is
promulgate rules
exempts utility units
included in
included in
exempts utility units
requiring
from Hg regulation
determining
determining
from Hg regulation
additional NOx
under CAA, Section
Lowest Achievable
Lowest Achievable
under CAA, Section
and SO
112, including
Emission Rate
Emission Rate
112, including
2
reductions within
residual risk
(LAER)and the
(LAER)and the
residual risk
two years of such
provisions
offset requirement
offset requirement
provisions
determination
in non-attainment
in non-attainment
prevents EPA from
areas is eliminated
areas is eliminated
prevents EPA from
other provisions
enforcing any
for new electric
for new electric
enforcing any
to protect local air
Section 126 petition
generating
generating
Section 126 petition
quality
before 2012
facilities
facilities
before 2014
NOx cap divided by
NOx cap divided by
region (West and
region (West and
East)
East)

CRS-10

H.R. 999/S. 485
H.R. 203
(Administration’s
H.R. 2042
H.R. 3093
S. 1844
Provisions
(Sweeney)
S. 366 (Jeffords)
Proposals)
S. 843 (Carper)
(Waxman)
(Bass)
(Inhofe)
Implemen-
tradeable
tradeable
tradeable allowance
tradeable
to be
tradeable
tradeable allowance
tation
allowance
allowance system
system for SO ,
allowance system
determined by
allowance system
system for SO ,
2
2
Strategy
system for SO
for SO (restricted
NOx, and Hg.
for SO , NOx Hg,
EPA – market
for SO , NOx Hg,
NOx, and Hg.
2
2
2
2
and NOx.
between East and
Allocation formulas
and CO .
mechanisms
and CO .
Allocation formulas
2
2
West regions),
in the bill initially
Allocation
permitted
Allocation
based on historic
Hg compliance
NOx and CO .
provide most
formulas for NOx,
(except for Hg)
formulas for NOx,
fuel usage adjusted
2
on a source-by-
Allowances
allowances to
Hg, and CO based
Hg, and CO based
by factors specified
2
2
source basis
allocated to
affected sources
on generating
on generating
in the bill
various sectors
free, with a small
efficiency; SO
efficiency; SO
2
2
and interests,
percentage sold at
allocations based
allocations based
7% of SO and 5%
2
including
auction. Over time,
on current CAA,
on current CAA,
of NOx and Hg
households,
an increasing
title IV provisions
title IV provisions
allowances are set
dislocated
percentage of the
aside for new units
workers and
allocation is sold at
Allocations
Allocations
communities,
auction with
formulas for all
formulas for all
electricity
affected sources
four pollutants
four pollutants
intensive
receiving fewer
include a new
include a new
industries,
allowances free
source reserve to
source reserve to
affected utilities,
provide allowances
provide allowances
energy efficiency
to newly
to newly
and renewable
constructed
constructed
energy activities,
sources
sources
and sequestration
activities
Hg compliance
on a source-by-
source basis
(plantwide
averaging
explicitly
allowed)
Unless otherwise noted, estimates by CRS using Department of Energy and Environmental Protection Agency data.