Regulating Greenhouse Gases from Coal Power Plants under the Clean Air Act

http://is.gd/lzeYJh

Under authority granted by the Clean Air Act, the Environmental Protection Agency is developing performance standards for existing stationary sources, such as power plants and industrial facilities. Coal-fired electricity generators represent an important part of this regulatory effort as they account for about one-third of annual U.S. carbon dioxide (CO2) emissions. New research from RFF’s Josh Linn, Erin Mastrangelo, and Dallas Burtraw confirms that there are important, low-cost opportunities to reduce emissions at existing coal-fired facilities in the short run.

The novelty and potential of the electricity sector standards raise three questions:

1. What are the available abatement opportunities from existing coal-fired power plants?
2. What are the costs of reducing emissions?
3. What is the increase in utilization at plants after they become more efficient?

The authors analyze the actual operating efficiency of the entire fleet of coal units in the United States, finding that fleetwide, emissions rate reductions of up to 5 percent may be technically feasible without changing the amount of electricity generated with coal.

Using the response of units to previous changes in fuel prices for the years 1985–2009, they estimate the costs of efficiency improvements to be as low as or perhaps somewhat lower than the engineering estimates currently used by EPA. They also find that efficiency improvements would lead to increased utilization of plants, which would erode up to 15 percent of the emissions reductions achievable by efficiency improvements.

The research provides the first empirical information about the actual magnitude and cost of these potential efficiency improvements across the fleet of existing generating units. Substantial long-term reductions in GHG emissions from the power sector will require greater use of nonemitting sources (renewables, nuclear), lower-emitting sources (natural gas), or postcombustion control of carbon. However, this analysis provides evidence that there exist important opportunities to reduce emissions in the short run.

The full paper is available free of charge at http://www.rff.org/Publications/Pages/PublicationDetails.aspx?PublicationID=21723

Abstract: The Clean Air Act has assumed the central role in U.S. climate policy, directing the Environmental Protection Agency to develop regulations governing the emissions of greenhouse gases from existing coal-fired power plants. The cost and environmental effectiveness of policy options depend on abatement costs, the magnitude of emissions reduction opportunities, and the sensitivity of plant utilization. This paper examines the operation of electricity-generating units over 25 years to estimate the marginal costs and potential magnitude of emissions reductions that could result from improvements in their operating efficiency. We find that a 10 percent increase in coal prices causes a 0.3 to 0.9 percent heat rate reduction, broadly consistent with engineering assessments of abatement costs and opportunities. We also find that coal prices have a significant effect on utilization, but that will vary depending on the policy design. The results are used to compare cost-effectiveness of alternative policies.

Resources For the Future (RFF) www.RFF.org
January 10, 2012

Health Impacts of Power-Exporting Plants in Northern Mexico

http://www.rff.org/Publications/Pages/PublicationDetails.aspx?PublicationID=21721

Abstract: In the past two decades, rapid population and economic growth on the U.S.–Mexico border has spurred a dramatic increase in electricity demand. In response, American energy multinationals have built power plants just south of the border that export most of their electricity to the United States. This development has stirred considerable controversy because these plants effectively skirt U.S. environmental air pollution regulations in a severely degraded international airshed. Yet to our knowledge, this concern has not been subjected to rigorous scrutiny. This paper uses a suite of air dispersion, health impacts, and valuation models to assess the human health damages in the United States and Mexico caused by air emissions from two power-exporting plants in Mexicali, Baja California. We find that these emissions have limited but nontrivial health impacts, mostly by exacerbating particulate pollution in the United States, and we value these damages at more than half a million dollars per year. These findings demonstrate that power-exporting plants can have cross-border health effects and bolster the case for systematically evaluating their environmental impacts.

The full paper is available free of charge at http://www.rff.org/RFF/Documents/RFF-DP-11-18-REV.pdf

Mean estimates of the annual value of health damages attributable  to Intergen emissions are $230,000 in the United States and $104,000 in Mexico. Mean estimates of annual damages attributable to Sempra emission are $160,000 in the United States and $72,000 in Mexico. The total value of annual health damages attributable to both plants is $566,000.

Health effects, concentration-response and valuation studies are summarized in Appendix tables. For Ozone costs of five separate health effects are estimated: 1) Respiratory Hospital Admissions, 2) Asthma Emergency Room Visits, 3) School Absence Days, 4) Minor Restricted Activity Days and 5) Short-term Mortality.  For particulates PM2.5  more effect costs are estimated including 1) Mortality, 2) Chronic Bronchitis, 3) Chronic bronchitis (CB) incidences are estimated annually for the age group 27 and over, 3) Nonfatal Heart Attacks, 4) Respiratory Hospital Admissions, 5) Cardiovascular Hospital Admissions, 6) Asthma Emergency Room Visits, 7) Acute Bronchitis in Children, 8) Upper Respiratory Symptoms in Children, 9) Lower Respiratory Symptoms in Children, 10) Asthma Exacerbations, 11) Work Loss Days, and 12) Minor Restricted Activity Days.

[The authors] use the VSL (value of a statistical life) estimate from Mrozek and Taylor (2002), which has a central value of $2.324 million. This estimate is quite conservative: it is at the low end of the values used in benefit-cost analysis. For example, 2009 U.S. EPA rules mandate that benefit-cost analyses use a VSL of $7.9 million, and 2009 U.S. Department of Transportation rules mandate a VSL of $6.0 million (Copeland 2010). Baseline incidence rates were obtained from the BenMap model used by U.S. EPA for regulatory analyses.

Chronic bronchitis (CB) incidences are estimated annually for the age group 27 and over. Baseline incidence and prevalence rates are from BenMap.  There are three valuation studies for chronic bronchitis. All three are from the BenMap model, and no specific studies are cited. The two cost-of- illness studies, one with a 3 percent discount rate and one with a 7 percent discount rate, are weighted by age within the 27-and-over age group. The other study is based on willingness to pay to avoid a case of pollution-related chronic bronchitis; this valuation does not vary within the 27-and-over age  group. Nonfatal heart attack (NFHA) incidences are estimated seasonally for the age group 18 and over. Baseline incidence rates are from BenMap. There are two NFHA valuation studies in TAF, both from BenMap with no specific study cited: one with a 3 percent discount rate, and one with a 7 percent discount rate. Both studies incorporate 10 years of medical costs and 5 years of wage costs.

by Allen Blackman, Santosh Chandru, Alberto Mendoza-Domínguez and Armistead G. Russell
Resources For the Future (RFF) www.RFF.org
RFF Discussion Paper 11-18; January, 2012

Wind energy success story at risk with 54,000 American jobs in the balance

http://www.awea.org/newsroom/pressreleases/Navigant_study.cfm

A study released December 12, 2011 finds that with stable tax policy the wind industry can create and save 54,000 American jobs in the next four years, including growing the wind manufacturing sector by one third to 46,000 American manufacturing jobs. This will keep the wind sector on track toward supporting the 500,000 jobs by 2030 projected in a report by the U.S. Department of Energy during the George W. Bush administration.

The report completed by Navigant finds that if Congress allows the Production Tax Credit (PTC) for wind to expire, jobs in the wind industry will be cut in half, meaning a loss of 37,000 American jobs and a one third cut to American wind manufacturing jobs, while private investment in the industry would drop by nearly two thirds. Meanwhile, extending the PTC will create 17,000 American jobs, Navigant finds. The report can be found here.

“American manufacturing jobs are coming back, with tens of thousands of new jobs from wind power,” said Denise Bode, CEO of the American Wind Energy Association (AWEA). “But these jobs could vanish if Congress allows the Production Tax Credit to expire, in effect enacting a targeted tax increase, and sending our jobs to foreign countries. Congress must act now to keep this American manufacturing success story going.”

With the support of a stable PTC, wind energy is powering one of America’s fastest growing manufacturing sectors. Over the last six years, U.S. domestic production of wind turbine components has grown 12-fold to more than 400 facilities in 43 states, shifting manufacturing jobs from overseas back to the U.S.

The Navigant study finds that wind energy’s geographically diverse manufacturing base would spread job gains around the country. States that would see significant job and private investment gains from a PTC extension include Colorado, Texas, Iowa, Illinois, Pennsylvania, California, Oregon, North Dakota and Ohio.

“We have made a significant investment during the last three years creating several hundred jobs for the state of Illinois to support the wind industry domestically,” said Terry R. Royer, CEO of Winergy Drive Systems Corporation. “With the uncertainty of the PTC extension, we are seeing the hesitation of our customers to make continued commitments for orders in late 2012 and 2013. An immediate extension is needed to support the investment we have made in our operations and secure the jobs that have been created.”

But, with a job-killing tax increase on the horizon and the PTC's future uncertain, businesses are hesitant to plan future US wind projects, American manufacturers have seen a drop in orders, and layoffs have already started.  For the purposes of the American wind industry manufacturing sector, which needs lead time to make its products, the PTC effectively expires at the end of this year.

Bipartisan legislation recently introduced by Representatives Dave Reichert (R, WA-08) and Earl Blumenauer (D, OR-03) seeks to grant a four-year extension to the existing Production Tax Credit (PTC) for wind energy (H.R. 3307, the “American Renewable Energy Production Tax Credit Extension Act”). This legislation has garnered the support of 36 cosponsors including 11 Republicans.

This legislation recently received the endorsement of a broad, coalition of more than 370 members, including the National Association of Manufacturers, the American Farm Bureau Federation, the Edison Electric Institute, the Western Governors’ Association, the United Steelworkers and many members of the environmental community. A four-year PTC extension also has the support of the bipartisan Governors’ Wind Energy Coalition comprised of 23 Republican and Democrat Governors from across the U.S.

About the Production Tax Credit:

The PTC is a tax incentive that helps keep electricity rates low and encourages development of proven clean energy projects. Private investment generated over the last four years of relative PTC stability averages $17 billion a year.

The wind energy PTC will expire in 2012 unless Congress takes action. Failure to extend the PTC would lead to job losses and will put the brakes on the progress America has made to include clean, affordable, homegrown energy as part of the U.S. electricity portfolio.

Facing the threat of the PTC expiring, wind project developers have become hesitant to plan future U.S. projects and American manufacturers have seen a marked decrease in orders. The wind industry is facing the recurrence of the boom-bust cycle it saw in previous years when the PTC was allowed to expire. In the years following expiration, installations dropped by between 73 and 93 percent, resulting in major job losses.

American Wind Energy Association (AWEA) www.AWEA.org

Press Release dated December 13, 2011

An App to Kill the Printed Catalog

http://www.triplepundit.com/2011/12/killer-app-catalog-spree-beating-printed-catalog/ 
The holiday season is the shopping season. It is also the catalog season, with tens of millions of glossy catalogs sent out to encourage people to shop. Although there’s nothing new about it, this year we can finally say there is a light at the end of the catalog tunnel. I’m talking about Catalog Spree, “the ultimate digital catalog shopping experience for the iPad.”

... It’s convenient, user-friendly, provides customers with a fun and easy shopping experience and retailers with an effective way to engage with customers, not to mention a better ROI. In other words, it’s a game changer.

... Printed catalogs [are] ... one of the most vivid examples for the unsustainability of the existing economic model. Think about it – each year, about 19 billion catalogs are mailed to American consumers. It means that every American receives more than 60 catalogs every year on average. Why? Because according to the Direct Marketing Association, printed catalogs provide a 7 to 1 ROI and an impressive direct order response rate of 2.24 percent....

... The only reason printed catalogs generate such ROI is because retailers don’t pay for their environmental impacts. These externalities include, according to Catalog Choice, 53 million trees that produce 3.6 million tons of paper, 5.2 million tons of carbon dioxide emissions, and 53 billion gallons of wastewater. If you would add these elements to the bill, I doubt how attractive the ROI of catalogs will look then.

In the last decade or so we have seen endless efforts to reduce the number of catalogs. Organizations and activists fought fiercely against retailers, tried to educate both the public and retailers why catalogs are bad for planet, created innovative tools such as Catalog Choice to help people opt out, supported legislation to ease the opt-out process, and so on. There were few victories here and then, but in all the number of printed catalogs continued to be stable.

The only thing that has put a dent in what seemed to be an unbeatable system is the economy. Rising production costs together with the sluggish economy got some retailers like Bloomingdales, Nordstrom and J. Crew to stop mailing catalogs to their customers and start showing them on their website. The digital shopping experience they provided was nice but not that great. Something was still missing there. Then came the iPad....

... In 2011 we have seen a growing number of companies and websites that are offering catalog apps...

Catalog Spree ... enables users to flip through catalogs from 150 retailers such as Coldwater Creek, JCPenney and American Girl. The app ... already has more than 150,000 users. Its business model is based on revenue share with some retailers and payments for traffic from others. It’s not clear if the company is profitable yet, but it secured a $6.1 million investment in Series A funding, led by Comcast Ventures, with participation from BlackBerry Partners Fund and El Dorado Ventures.

... Printed catalogs is a $300 billion industry and you start to see why they decided to invest money in Catalog Spree.... Filston [spends] .... $1 million ... on printed catalogs....

By Raz Godelnik, co-founder of Eco-Libris, a green company working to green up the book industry in the digital age and adjunct professor in the University of Delaware’s Alfred Lerner College of Business and Economics.
FOR FULL POST GO TO:
http://www.triplepundit.com/2011/12/killer-app-catalog-spree-beating-printed-catalog/
Triple Pundit www.triplepundit.com 
December 23rd, 2011

According to https://www.catalogchoice.org/environmental-facts each year, 19 billion catalogs are mailed to American consumers. What's the impact?

• Number of trees used - 53 million trees
• Pounds of paper used - 3.6 million tons of paper
• Energy used to produce this volume of paper - 38 trillion BTUs, enough to power 1.2 million homes per year
• Contribution to global warming - 5.2 million tons of carbon dioxide emissions, equal to the annual emissions of two million cars
• Waste water discharges from this volume of paper - 53 billion gallons of water, enough to fill 81,000 Olympic-sized swimming pools

Environmental impact estimates were made using the Environmental Defense paper calculator.

The costs can be estimated crudely through a variety of sources.

According to the National Tree Benefit Calculator at http://www.treebenefits.com/calculator/  the value of a 24 inch maple tree in a park or vacant area in the North is $146 http://www.treebenefits.com/calculator/ReturnValues.cfm?climatezone=North.  According to http://www.arborday.org/trees/benefits.cfm the average value of a street tree is $525.  For 15 productive trees http://www.arnatural.org/forestry/timber.htm assigns a value of $239.74 or $15.98 per tree.  We have utilized a value of $16 per tree.

According to RISI PPI Pulp and Paper Week at http://www.cliffordpaper.com/cpidesktop/pulpandpaperlatest.pdf prices for coated paper in December ranged from $795-$1,350 per ton.  We conservatively used a price of $900 per ton.

According to a March 10, 2011 Federal Register Notice entitled "Energy Conservation Program for Consumer Products: Representative Average Unit Costs of Energy" by the Energy Efficiency and Renewable Energy Office available at http://www.federalregister.gov/articles/2011/03/10/2011-5501/energy-conservation-program-for-consumer-products-representative-average-unit-costs-of-energy Representative Average Unit Costs of Energy per million BTU Electricity were $34.14 (11.65¢/kilowatt hour (kWh), for Natural Gas $11.01 ($1.101/therm or $11.29/MCF) and for Heating Oil $24.59 or $3.41/gallon.   We have utilized an estimate of $22.50 per million BTUs.

According to a February 10, 2010 Technical Support Document: "The Social Cost of Carbon for Regulatory Impact Analysis Under Executive Order 12866" available at  http://www.epa.gov/otaq/climate/regulations/scc-tsd.pdf an Interagency Working Group on the Social Cost of Carbon (SCC), United States Government with participation by the Council of Economic Advisers, the Council on Environmental Quality, the Department of Agriculture, the Department of Commerce, the Department of Energy, the Department of Transportation, the Environmental Protection Agency, the National Economic Council, the Office of Energy and Climate Change, the Office of Management and Budget, the Office of Science and Technology Policy and the Department of the Treasury selected four SCC estimates for use in regulatory analyses. For 2010, these estimates are $5, $21, $35, and $65 (in 2007 dollars). The first three estimates are based on the average SCC across models and socio-economic and emissions scenarios at the 5, 3, and 2.5 percent discount rates, respectively. The fourth value is included to represent the higher-than-expected impacts from temperature change further out in the tails of the SCC distribution. The central value is the average SCC across models at the 3 percent discount rate. These SCC estimates grow over time. For instance, the central value increases to $24 per ton of CO2 in 2015 and $26 per ton of CO2 in 2020.  Based upon this we conservatively apply a value of $20 per ton.

According to http://www.co.lancaster.pa.us/toolbox/lib/toolbox/ruralww/muniwastedisposalmin.pdf centralized wastewater treatment facilities can cost anywhere from $20-$40 per gallon or more, depending on the size, the level of treatment required, the economy, and whether the project is a private job or a government job.

Tallying the costs results in the following:

Increased Recycling Would Create Nearly 1.5 Million Jobs, Reduce Pollution

http://www.bluegreenalliance.org/press_room/press_releases?id=0170
Higher recycling rates hold the potential to produce millions of new jobs, would strengthen local economies, reduce pollution and improve public health, according to a new report released November 15, 2011.

At a National Recycling Day event at the U.S. Capitol, Sen. Tom Carper (D-DE), a representative from the office of U.S. Rep. Frank Pallone (D-NJ) and a panel of environmental, labor and other leaders discussed the report, "More Jobs, Less Pollution," which found that a 75 percent national recycling rate holds the potential to create millions of new jobs.

"More Jobs, Less Pollution"  is a report from the Tellus Institute prepared for the BlueGreen Alliance, SEIU, NRDC, Teamsters, Recycling Works!, and the Global Alliance for Incinerator Alternatives (GAIA) available free of charge at www.bluegreenalliance.org/morejobslesspollution.

A 75 percent national recycling rate would also reduce CO2 emissions by 276 million metric tons by 2030 - equivalent to eliminating emissions from 72 coal-fired power plants or taking 50 million cars off the road; reduce conventional and toxic emissions that impact human and ecosystem health; and generate a stronger economy by creating a broader employment base.
...

MSW is Municipal Solid Waste, C&D = Construction and Demolition Debris

The Massachusetts Department of Environmental Protection (MassDEP) has made available several case studies that demonstrate the waste diversion and economic benefits of the ban. Clarke Corporation, a wholesale distributer of kitchen appliances, renovated and expanded its distribution center in Milford, Mass. Ninety-eight percent of materials generated on site were recycled or reused, resulting in cost savings of $259,043. In another case, recycling during the commercial demolition of the Massachusetts Institute of Technology (MIT) Media Lab in Cambridge resulted in 96 percent waste reduction and cost savings of  $17,684. For more information and the C&D recycling case studies, see http://www.mass.gov/dep/recycle/reduce/managing.htm.

The Blue-Green Alliance www.bluegreenalliance.org
Press Release dated November 15, 2011