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Highlights of Clear Skies in North Carolina
- North Carolinas Clean Smokestacks Act will substantially
reduce emissions of SO2 and NOx in the State.
- Clear Skies builds on North Carolinas Clean Smokestacks
Act to achieve additional emission reductions in the state, particularly
for mercury; an additional 17% reduction in NOx and 43% reduction
in mercury by 2020 due to Clear Skies. Clear Skies also achieves
substantial emissions reductions in neighboring states, which
the Clean Smokestacks Act cannot accomplish.
- By 2020, North Carolina would receive approximately $5.8 billion
in annual health benefits from reductions in fine particle and
ozone concentrations alone due to Clear Skies (an alternative
estimate projects $1 billion in health benefits in North Carolina).
This includes 700 fewer premature deaths (400 under the alternative
estimate) and 800 fewer hospitalizations/emergency room visits
for asthma.
- North Carolina would receive environmental benefits, including
reductions in acid deposition that will benefit forests and streams
in the Appalachian Mountains and reductions in nitrogen deposition
that will benefit the states coastal waters.
- Clear Skies does not significantly impact electricity prices.
With or without Clear Skies, electricity prices in the electricity
supply region that includes North Carolina are expected to remain
below 2000 prices.
Clear Skies: An Innovative Approach to Improving Human Health
and the Environment
Why Clear Skies?
- Air quality has improved, but serious concerns persist
- North Carolina citizens suffer ill effects from air pollution,
including asthma attacks and premature death
- Statewide efforts, like the Clean Smokestacks Act, cannot
reduce emissions from neighboring states
- Electricity generation sector remains a major emissions source
- Very cost-effective to control the power sector, relative
to other sources
- Sources are concerned about upcoming complex and burdensome
regulations
Advantages of the Clear Skies Approach
- Guarantees significant nationwide emissions reductions
beginning years before full implementation
- Sources in North Carolina and nearby states would substantially
reduce emissions of SO2, NOx, and mercury
- Delivers dramatic progress towards achievement of critical
health and environmental goals
- Uses proven, market-based flexible approach with incentives
for innovation
- Recognizes environmental needs as well as industry constraints,
allowing industry to better manage its operations and finances
while lowering risks to the public
- Sources are projected to install pollution controls to enable
continued reliance on coal
- Increases certainty across the board for industry, regulators,
and consumers
Under Current Clean Air Act Power Plants Would Face a Complex
Set of Requirements

For a larger image, click here.
Clear Skies Sets a Firm Timeline for Emission Reductions
| The existing Title IV SO2 cap-and-trade program provides
an incentive and a mechanism to begin reductions upon enactment
of Clear Skies years before regulatory action under the current
Act. |
2004: The NOx SIP call (summertime NOx cap in 19 Eastern
States + D.C.)
2008: Clear Skies NOx Phase I (2.1 million ton annual cap
assigned to two Zones with trading programs)
2010:
- Clear Skies Hg Phase I (26 ton annual cap with a national trading
program)
- SO2 Phase I (4.5 million ton annual cap with a national trading
program)
2018:
- Clear Skies NOx Phase II (1.7 million ton annual cap assigned
to two Zones with trading programs)
- Clear Skies Hg Phase II (15 ton annual cap with a national
trading program)
- Clear Skies SO2 Phase II (3.0 million ton annual cap with a
national trading program)
Emissions in North Carolina under Clear Skies
|
Emissions in North Carolina (2020) would be significantly
reduced from 2000 levels by the combined efforts of the Clean
Smokestacks Act and Clear Skies:
- 69% reduction in SO2 emissions
- 67% reduction in NOx emissions
- 63% reduction in mercury emissions
These reductions are mostly attributable to the Clean Smokestacks
Act, with the exception of mercury, which is reduced by another
43% beyond what North Carolinas rule would achieve in
2020.
|
Emissions: Current (2000) and Existing Clean Air Act Regulations
(base case*) vs. Clear Skies in North Carolina in 2010 and 2020


Note:
The base case in IPM includes Title IV, the NOxSIP Call, NSR settlements,
and state-specific caps in CT, MA, MO, NC, NH, TX, and WI. It does
not include mercury MACT in 2007 or any other potential future regulations
to implement the current ambient air quality standards or other
parts of the Clean Air Act. Base case emissions in 2020 will likely
be lower due to state and federal regulatory actions that have not
yet been promulgated.
Emission Reductions under Clear Skies
| Emissions in North Carolina and surrounding
states would decrease considerably. These emission reductions
would make it much easier for North Carolina to maintain compliance
with the national air quality standards. |

Note: The base case in IPM includes Title IV, the NOx SIP
Call, NSR settlements, and state-specific caps in CT, MA, MO, NC,
NH, TX, and WI. It does not include mercury MACT in 2007 or any
other potential future regulations to implement the current ambient
air quality standards or other parts of the Clean Air Act. Base
case emissions in 2020 will likely be lower due to state and federal
regulatory actions that have not yet been promulgated. Emissions
projected for new units in 2020 are not reflected.
Clear Skies Health Benefits in North Carolina
Improve Public Health
| By 2020, North Carolina would receive
approximately $5.8 billion in annual health benefits from reductions
in fine particle and ozone concentrations alone due to Clear
Skies. (See note 1.) |
- Reduced ozone and fine particle exposure by 2020 would result
in public health benefits of:
- approximately 700 fewer premature deaths each year
- approximately 500 fewer cases of chronic bronchitis each
year
- approximately 1,000 fewer non-fatal heart attacks each year
- approximately 1,500 fewer hospital and emergency room visits
each year
- approximately 88,000 fewer days workers are out sick due
to respiratory symptoms each year
- approximately 5,400 fewer school absences each year
- Reduced mercury emissions would reduce exposure to mercury through
consumption of contaminated fish, resulting in additional, unquantified
benefits for those who eat fish from North Carolina lakes, streams,
and coastal waters.
Counties Projected to Remain Out of Attainment with the PM2.5
and Ozone Standards in North Carolina
- Catawba, Davidson, and Mecklenburg counties are projected to
remain out of attainment with the annual fine particle
standard in 2010 with the Base Case but would attain the standard
under Clear Skies.
- Mecklenburg County is projected to be out of attainment (ozone
concentration=85ppb) with the ozone standard with Clear Skies
in 2010 but is in attainment by 2020.
Note: Based on 1999-2001 data of
counties with monitors that have three years of complete data. The
base case includes Title IV, the NOx SIP Call, the Tier II, Heavy-Duty
Diesel, and Nonroad Diesel rules, final NSR settlements as of early
spring 2003, and state-specific caps in CT, MA, MO, NC, NH, TX,
and WI. It does not include mercury MACT or any other potential
future regulations to implement the current ambient air quality
standards or other parts of the Clean Air Act.
Clear Skies Will Help North Carolina Meet Air Quality Standards
- Currently there are 15 counties exceeding the annual fine particle
standard and 22 counties exceeding the 8-hour ozone standard.
- All of these counties are expected to be brought into attainment
with the fine particle standard under existing programs.
- All of these counties are expected to be brought into attainment
with the ozone standard under existing programs.
- Clear Skies would significantly improve air quality in North
Carolina beyond what is expected from existing programs.
- By 2010, Clear Skies would bring all 3 remaining non-attainment
counties (Catawba, Davidson, and Mecklenburg--population approximately
1 million) into attainment with the annual fine particle standard.
- By 2020, all counties are projected to be in attainment
with both the annual fine particle and 8-hour ozone standard.
- In addition, Clear Skies would reduce ozone and fine particle
concentrations in counties throughout the state.
Note: Based on 1999-2001 data of
counties with monitors that have three years of complete data.
Airsheds for the Southern Blue Ridge Mountains


This section shows regional airshed maps that were developed for
the Southern Blue Ridge Mountains (which includes Shenandoah National
Park).
- Multiple emission sources in numerous states contribute to air
quality degradation and acid deposition in the Southern Blue Ridge
region.
- In 2020, emissions from power plants in the Southern Blue Ridge
region are projected to be substantially lower with Clear Skies
than under the Base Case:
- SO2 emissions are projected to decrease 61%;
- NOx emissions are projected to decrease 68%.

Note: An
airshed depicts a modeled approximation of a large proportion of
sources contributing to air quality in a particular receptor region.
Visibility Benefits in National Parks
Click here for a larger image
Clear Skies Environmental Benefits in North Carolina
Projected Changes in Nitrogen Deposition with the Base Case
in 2020 Compared to 2001
Projected Changes in Nitrogen Deposition with Clear Skies and
the Base Case in 2020 Compared to 2001
Note: Alaska and Hawaii are not
included in the model domain
Clear Skies Would Provide Substantial Environmental Benefits in
North Carolina
In comparison to existing programs,
- Visibility would improve perceptibly.
- The value of this benefit for great Smoky Mountain National
Park is $1.9 billion.
- The value of improved visibility for various Wilderness
Areas in North Carolina (Swanquarter, Shining Rockand Linville
Gorge Wilderness Areas) would be millions of dollars.
- Sulfur deposition, a primary cause of acid rain, would decrease
30-60% in the Appalachian Mountains of North Carolina.
- Nitrogen deposition, another significant contributor to acid
rain as well as a cause of damage in nitrogen-sensitive forests
and coastal waters, would decrease 20%.
- Mercury deposition would decrease up to 15% throughout most
of the state.*
* These results are based on modeling the Clear
Skies mercury cap without triggering the safety valve.
Electricity Generation in North Carolina under Clear Skies
Current and Projected Generation by Fuel Type
in North Carolina under Clear Skies (GWh)
|
North
Carolinas sources
are projected to reduce their emissions through the
installation of emission controls, rather than through
a switch from
coal to natural gas.
- In 2010, 78% of North Carolinas coal-fired
generation is projected to come from units with
advanced
SO2, NOx and/or mercury control equipment;
in 2020, the percentage is projected to increase
to 93%. Most
pollution controls are projected to be installed
to meet the reductions required under the Clean
Smokestacks
Act.
|
|
|

North Carolinas electricity
growth is projected to be met by increases in gas-fired and
coal-fired generation. Clear Skies does not significantly alter
this projection.
- Electricity from coal-fired generation will increase by
26% from 1999 to 2020.
|
Emission Controls in North Carolina under Clear Skies
Under Clear Skies
by 2020...
- 10% of coal-fired capacity would install SCR
- 4% would install scrubbers
- 1% would install mercury controls
|
The major generation
companies in North Carolina include:
- Duke Energy Corporation
- Progressive Energy Carolinas, Inc.
Total coal-fired capacity in North Carolina is projected
to be 12,694 MW in 2010
|
|
|
Units in North Carolina Projected to
Be Retrofitted Due to Clear Skies by 2020
|
|
Plant Name
|
Unit ID
|
Technology
|
| BUCK |
8 |
Scrubber/ SCR |
| BUCK |
9 |
Scrubber/ SCR |
| G G ALLEN |
5 |
Scrubber/ SCR |
| MAYO |
1A |
SCR* |
| MAYO |
1B |
SCR* |
| Westmoreland LG&E Partners Roanoke Valley 1 |
| GEN1
| ACI*
| * Retrofit was installed
under Clear Skies by 2010 |
|
Notes:
1. Retrofits and total coal-fired capacity apply to coal units
greater than 25 MW.
2. Cliffside units 2 and 3 are projected to be removed from
operation by 2005 with Clear Skies due to excess gas-fired capacity
in the marketplace, unless otherwise needed for voltage purposes.
The recent overbuild of gas-fired generation reduces the need
for less efficient units operating at lower capacity factors.
These units are inefficient compared to other coal-fired plants
and newer gas-fired generation. Less conservative assumptions
regarding natural gas prices or electricity demand would create
a greater incentive to keep these units operational.
Electricity Prices in North Carolina under Clear Skies
- With or without Clear Skies, retail prices in the
North American Electric Reliability Council (NERC)
SERC region (the electricity supply region that contains
North Carolina) are projected to decrease between
2005 and 2020.
- With Clear Skies, retail prices are projected to
be approximately 0.7 2.8% higher between 2005
and 2020 than in the absence of the legislation.
|


|
In 2000, the average retail electricity price in North
Carolina was approximately 6.5 cents/kWh, which was
below the average national retail price of approximately
6.7 cents/kWh.
|
Note: The base case in IPM
includes Title IV, the NOx SIP Call, NSR settlements, and
state-specific caps in CT, MA, MO, NC, NH, TX, and WI. It
does not include mercury MACT in 2007 or any other potential
future regulations to implement the current ambient air quality
standards or other parts of the Clean Air Act. Base case emissions
in 2020 will likely be lower due to state and federal regulatory
actions that have not yet been promulgated.
Costs and Benefits in North Carolina under Clear Skies
|
Clear Skies
- Guarantees significant emissions reductions
beginning years before full implementation
- Uses a proven and flexible market-based approach
with incentives for innovation
- Increases certainty across the board for industry,
regulators, and consumers
|
Benefits Outweigh the Costs
- In North Carolina, Clear Skies is projected to cost approximately
$113 million annually by 2020 while providing health benefits
totaling approximately $5.8 billion annually. The vast majority
of benefits come from emission reductions in neighboring
states.
- The increases in production costs under Clear Skies represent
only a small percentage of total retail electricity sales
revenue in North Carolina.
- Retail electricity sales revenue in North Carolina
was over $7.7 billion in 2000.
- Adjusting these sales revenues by the same growth
rate used for the modeling of costs would result in
revenues of almost $11.9 billion annually in 2020.
- Nationwide, the projected annual costs of Clear Skies
(in $1999) are $4.3 billion in 2010 and $6.3 billion in
2020; the nationwide benefits of Clear Skies are expected
to be over $113 billion annually by 2020.
- An alternate estimate projects annual health benefits
totaling $23 billion.
Note: Costs include capital
costs, fuel, and other operation and maintenance costs (both
fixed and variable) associated with the achievement of the
emissions caps in the legislation (for example, the installation
and operation of pollution controls). These state-level production
costs are estimates; they do not account for the costs associated
with the transfer of electricity across regions, nor the costs
or savings that could be associated with allowance movement
between sources.
Notes on EPA's Analysis
- The information presented in this analysis reflects EPA's
modeling of the Clear Skies Act of 2003.
- EPA has updated this information to reflect modifications:
- Changes included in the Clear Skies Act of 2003.
- Revisions to the Base Case to reflect newly promulgated
rules at the state and federal level since the initial
analysis was undertaken.
- The Clear Skies modeling results presented include
the safety valve feature
- This analysis compares new programs to a Base Case (Existing
Control Programs), which is typical when calculating costs
and benefits of Agency rulemakings.
- The Base Case reflects implementation of current control
programs only:
- Does not include yet-to-be developed regulations
such as those to implement the National Ambient
Air Quality Standards.
- The EPA Base Case for power sector modeling includes:
- Title IV, the NOx SIP Call, NSR settlements, and
state-specific caps in Vermont, Massachusetts, Missouri,
Vermont, North Carolina, Texas, and Wisconsin finalized
before March 2003.
- For air quality modeling, the Base Case also includes
federal and state control programs, as well as the Tier
II, Heavy Duty Diesel, and Non-Road Diesel rules.

1. An alternative methodology
for calculating health-related benefits projects approximately
400 premature deaths prevented and $1 billion in health benefits
each year in North Carolina by 2020.
|
State information based on EPA's modeling of the Clear
Skies Act of 2002 is presented here for archival reasons.
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