Improving Air Quality: Controlling Mobile Sources Chapter 11.
Improving Air Quality: Controlling Stationary Sources
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Transcript of Improving Air Quality: Controlling Stationary Sources
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Improving Air Quality: Controlling Stationary Sources
Chapter 12
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1. Understanding Acidic Deposition
What is Acidic Deposition?• Occurs when sulfuric and nitric acids
mix with other airborne particles and fall to earth as wet or dry ____________
• These acids arise from the chemical reaction of SO2 and NOx emissions with water vapors and oxidants in atmosphere
• _____ is the more significant contributor– Major sources are fossil-fueled electricity
plants, refineries, and other users of sulfur-containing fuel
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2. Controlling Stationary Sources
Overview• Stationary sources include electric power plants,
chemical plants, steel mills, etc.
• Primary controls in the U.S. are ___________ _________________with _______________
___________ added over time
• These controls vary with – Facility age (new versus existing)– Facility location (PSD versus nonattainment area)
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(1) Technology-based Standards
Dual-Control Approach
• For new/modified stationary sources–____-administered stringent limits, New
Source Performance Standards (NSPS), are used; more stringent
• For existing stationary sources–_____-administered limits are used; less
stringent
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Setting the Control Technologies
• PSD areas (more stringent)– New sources: limits based on best available
control technology (BACT)– Existing sources: limits based on best
available retrofit technology (BART)
• Nonattainment areas (less stringent)– New sources: limits based on lowest
achievable emissions rate (LAER)– Existing sources: limits based on reasonable
available control technology (RACT)6
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(2) Emissions Trading
• For existing sources
– Bubble policy: plants can measure emissions of a single pollutant as an __________ of all emission points
– Emissions banking: a source can save __________________________ if it cuts emissions more than required by law and can deposit these through a banking program
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• For new/modified sources
– Netting: for use in _____ areas by modified sources; any added emissions associated with a plant modification must be exactly ________ by a reduction from some where else within that same plant
– Offset plan: for use in ________________ areas; uses emissions trading to allow releases from a new/modified source to be more than countered by reductions achieved by existing sources
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(3) Acid Rain Program: SO2 Emissions Allowance Trading
• ________ of the 1990 CAAA established a two-phase acid rain initiative, establishing:– a reduction plan for NOX emissions
– a cap and trade allowance program for SO2 emissions
• Phase I for the 1995–1999 period; phase II for the 2000–2009 period
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Cap and Trade Program for SO2
• National SO2 emissions caps established a permanent annual cap of _____ million tons for electric power plants starting in 2000, tightened to 8.95 million tons for 2010
• SO2 Emissions Allowance Program – EPA issues tradeable emission allowances: each
allowance permits the release of ______ of SO2 – Total number issued sets the national limit
• Auctions also are held for direct sale of allowances– Administered by the Chicago Board of Trade
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(4) Ozone Control: NOX Trading Programs • Established under CAAA 1990, the Ozone Transport
Commission (OTC) developed the OTC NOX Budget Program
• In 1998, a new initiative, the NOX SIP call, required affected states to submit revised State Implementation Plans (SIPs) to achieve certain emission limits during ozone season, starting in 2003– EPA recommended using a cap and trade program
and established the NOX Budget Trading Program (NBP) in 2003 as successor to the original OTC program
– Goal is to reduce NOX emissions by _________ _____ per year
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3. Analyzing Stationary Source Controls
(1) Higher Cost of CAC Methods
• Standards-based approach is _____________ – The inflexibility adds to society’s costs and
gives low-cost abaters no incentive to clean up beyond the level set by law
• Most empirical studies show that the cost of using a command-and-control instrument relative to the least-cost method is _________ than 1
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(2) New Source BiasDual Control Approach• Existing sources are controlled by states, which
have an incentive to set relatively _________ standards to avoid losing firms to other states
• In turn, firms have an incentive not to initiate new construction to avoid the more stringent and more costly NSPS
• Result is that the dual control approach perversely ____________ construction of new and presumably cleaner-running new facilities
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(3) Cost-effectiveness of Emissions Trading Programs
• Low-cost abaters will reduce emissions and sell excess allowances (suppliers)– Will sell at any P higher than their MAC
• High-cost abaters will buy allowances rather than abate (demanders)– Will buy at any P lower than their MAC
• Trading should continue until MACs are equal, achieving a cost-effective solution
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Polluter’s Abatement DecisionExample: SO2 Abatement
$
SO2 Abatement(millions of tons)
P of 1-ton allowance
MAC
A00
Up to A0, cheaperfor firm to abate;MAC < P
Beyond A0, cheaper forfirm to buy allowances;P < MAC
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An emissions cap: A limit on the total amount of pollution that can be emitted (released) from all regulated sources (e.g., power plants); the cap is set lower than historical emissions in order to reduce emissions.
Allowances: An authorization to emit a fixed amount of a pollutant.
Allowance trading: Sources can buy or sell allowances on the open market. Because the total number of allowances is limited by the cap, emission reductions are assured.
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