is Clear Skies?
- The Clear Skies Act sets forth a mandatory program that would dramatically
reduce and permanently limit power plant emissions.
What would Clear Skies do?
- Clear Skies would establish caps on sulfur dioxide (SO2), nitrogen
oxides (NOx) and mercury emissions at levels 70% below year 2000 emission
levels. The caps on emissions, coupled with rigorous monitoring protocols
and automatic enforcement provisions, ensure that these reductions
would be achieved and sustained over time. Clear Skies would provide
these reductions faster, with more certainty and at less cost to America's
consumers than would current law.
How does Clear Skies compare to existing air pollution laws?
- The Clear Skies Act would move the Clean Air Act forward by providing
greater protection over the next decade. EPA's analyses indicate that
the cumulative emissions reductions and health and environmental benefits
over the next decade from Clear Skies are markedly greater than could
be expected under the current Clean Air Act.
- These benefits would happen at a considerably lower cost, and with
greater certainty, than would occur under the current Clean Air Act.
This is due in large measure to the major innovation of Clear Skies - a
market-based, integrated multi-pollutant emissions reduction strategy
for power generation.
- Clear Skies would require a 70% decrease in power plant emissions
of SO2 and NOx, which contribute to ozone and fine particle pollution.
- Clear Skies would get greater reductions of SO2 and NOx than we
expect from the current Clean Air Act power plant regulations that
would be replaced or modified by Clear Skies (e.g., new source review
(NSR), regional haze (or BART), the Acid Rain program, and the NOx
- Clear Skies would not change the health-based air quality standards
for ozone and fine particles - those standards will still have to
be met. In fact, Clear Skies
would help bring more areas into attainment with these health-based
standards over the next decade than would current law.
- Clear Skies would require reductions of approximately 70% in power
plant emissions of mercury.
- EPA expects less mercury to be emitted by power plants over the
next 5 years if Clear Skies is enacted.
- EPA cannot predict what mercury emissions would be under the current
Clean Air Act after that because EPA is currently engaged in a rulemaking
process to set a standard for mercury emissions from power plants
which will go into effect no sooner than the end of 2007 (this rule
will likely be litigated).
- Clear Skies would take today's power plant emissions of mercury
(48 tons) down to a cap of 15 tons.
- Clear Skies would not change Clean Air Act requirements for sources
not covered by Clear Skies.
Is New Source Review the fundamental provision in the Clean Air
Act to reduce power plant emissions?
- There is a misconception that the New Source Review (NSR) program
is designed to require power plants to reduce emissions. This is simply
incorrect. NSR applies to existing power plants and major manufacturing
facilities only when they make modifications to their plants which
result in increased emissions. They may then be required to install
new emission control equipment.
- Clear Skies, on the other hand, is specifically designed to require
the power generation industry to reduce their emissions and maintain
those reductions by capping emissions at the specified levels. The
industry may employ the compliance strategy of its choosing as long
as it meets emission reduction requirements.
What emission reductions would Clear Skies deliver compared to the
existing Clean Air Act?
- There are great uncertainties (regulatory development, litigation,
implementation time, etc.) as to how quickly and effectively current
regulations would be implemented over the next decade under existing
- In contrast, the mandatory emissions caps at the heart of Clear
Skies are a sure thing and guarantee that reductions will be maintained
over time. And, because cap-and-trade programs include economic incentives
for early action, Clear Skies would begin improving public health
- Quantifiable health benefits under Clear Skies grow to $110 billion
annually by 2020, and include prevention each year of: 14,000 premature
deaths; 30,000 costly hospitalizations and ER visits; and 12.5 million
days with respiratory illnesses and symptoms. An alternative methodology
for calculating health-related benefits projects over 8,400 premature
deaths prevented and $21 billion in health benefits - still far greater
than the costs.
Would Clear Skies go far enough or fast enough?
- If enacted, Clear Skies would deliver early human health and environmental
benefits right away because its cap and trade program gives power
plants incentives to begin reducing emissions immediately.
- Clear Skies is designed to ensure that electricity generators are
able to obtain financing and perform installation of the necessary
pollution control equipment cost effectively. It would also ensure
that the large-scale installation of emissions control technologies
to achieve the necessary reductions can be accomplished, while allowing
the power industry to continue to provide reliable service to American
consumers at reasonable prices.
Would Clear Skies allow power plants to increase emissions beyond
- Clear Skies would maintain the protections provided by the health-based
national air quality standards, the major provision of the Clean Air
Act to protect local air quality.
- In fact, together with other Clean Air Act provisions, Clear Skies
would bring most of the country into attainment so that they meet
the clean air standards.
- Clear Skies also requires tough, technology-based new source standards
on all new power generation projects and maintains special protections
for national parks and wilderness areas when sources locate within
50 km of "Class I" national parks and wilderness areas.
- Clear Skies is designed to reduce emissions by significant amounts
over large geographic areas, and would improve air quality in every
part of the country where power plants contribute significantly to
Would the emission reductions under Clear Skies be voluntary?
- No. The emissions reductions under Clear Skies would be mandatory.
Like the successful Acid Rain Program, power plants not meeting the
requirements would be subject to non-negotiable penalties.
- The legislation would set aggregate emission limits, or caps, and
let industry find the most cost-effective way to achieve required
- Companies would have flexibility to choose how to comply,
not whether they comply. This system rewards innovation, reduces
costs and guarantees results.
- Required continuous emissions monitoring and reporting would allow
EPA and the states to know with certainty that emissions reductions
Would Clear Skies prevent states from requiring additional controls
on their own power plants?
- Clear Skies would do nothing to change the fundamental provision
contained in the Clean Air Act that permits each state to adopt more
stringent regulations on power plants (and other sources) under its
Will Clear Skies cause fuel switching?
- As the President said in the State of the Union, one of our goals "is
to promote energy independence for our country, while dramatically
improving the environment." Clear Skies would help accomplish this
goal by providing important environmental protection while maintaining
energy diversity and security.
- The emissions reductions under Clear Skies would be achieved primarily
through the installation of control technologies, not through fuel
switching, according to extensive economic modeling of the utility
industry using EPA's Integrated Planning Model.
- Under Clear Skies by 2010, 69% of U.S. coal-fired generation is
projected to come from units with advanced pollution control equipment
(such as scrubbers and SCR, which also substantially reduce mercury
emissions). In 2020, the percentage is projected to rise to 81%.
- Growth in electricity demand over the next 20 years is forecast
to be met through an increase in gas-fired generation and some increases
in coal-fired generation. Clear Skies does not significantly alter
Will Clear Skies cause electricity prices to rise?
- Retail electricity prices are expected to gradually decline from
today's levels but then rise over time with or without Clear Skies.
(Prices are expected to drop initially due to the increase of excess
generation capacity; in 2010 prices would begin to increase due to
new capacity requirements, which lead to higher capital costs and
greater natural gas use, and higher retail prices passed on to consumers.)
- Clear Skies would do so because it phases in large reductions
over time and gives industry flexibility as to how it makes those
* Note: Retail prices from 2000 are from
AEO2003. Prices for the period 2005 and after were calculated using
the Retail Electricity Price Model (see section G for a description
of the Model).