The U.S. Environmental Protection Agency (EPA) announced its final Good Neighbor Plan, a rule that it said will cut nitrogen oxide (NOx) emissions from power plants and other industrial facilities in 23 states. 

EPA said the rule would cut emissions that contribute to problems downwind states face in attaining and maintaining air quality standard for ground-level ozone, known as the 2015 Ozone National Ambient Air Quality Standards (NAAQS). 

The rule would use an approach during the summertime “ozone season” that is based on a NOx allowance trading program for fossil fuel-fired power plants in 22 states, and NOx emissions standards for targeted sources within nine industry categories in 20 states.

Beginning in the 2023 ozone season, power plants in 22 states are expected to take part in what EPA said is a “revised and strengthened” Cross-State Air Pollution Rule ozone season trading program.

To achieve rapid emissions reductions, EPA said it based the initial control stringency on the level of reductions achievable through immediately available measures, including consistently operating emissions controls already installed at power plants. Further reductions are expected to be phased in over several years starting in 2024. Those reductions would reflect emissions levels that could be achieved by installing new emissions controls.

Power plants in Utah would face the largest percentage decline in 2027 NOx emissions compared to 2021 levels. A 7,300-ton reduction, equal to a 74% reduction, would be required under the final rule. Mississippi emitters face a 65% reduction, while those in Louisiana and Missouri face a 61% reduction.

Texas power plants will be expected to cut NOx emissions by more than 14,000 tons by 2027, a 38% cut relative to 2021.

Source: EPA

EPA said its final Good Neighbor Plan builds on the “demonstrated success of existing emissions trading programs” by including additional features that “promote consistent operation of emissions controls to enhance public health and environmental protection for affected downwind regions.” 

Features include backstop daily emissions rates on large coal-fired units to promote more consistent operation and optimization of emissions controls, annual recalibration of the emissions allowance bank, and annual updates to the emissions budgets to account for changes in the generating fleet.

Beginning in the 2026 ozone season, EPA plans to set enforceable NOx emissions control requirements for certain sources at existing and new industrial facilities that have “significant impacts” on downwind air quality and the ability to install “cost-effective pollution controls.”

These industry-specific requirements would apply in 20 states. EPA said the requirements reflect “proven, cost-effective” pollution reduction measures that are “consistent with standards that sources throughout the country have long implemented.”

EPA said the final rule implements the Clean Air Act’s “Good Neighbor” or “interstate transport” provision, which requires each state to submit a State Implementation Plan (SIP). The SIP documents are intended to ensure that sources within the state do not contribute significantly to nonattainment or interfere with maintenance of the NAAQS in other states. 

Where EPA finds that a state has not submitted a Good Neighbor SIP, or if the EPA disapproves the SIP, the EPA must issue a Federal Implementation Plan (FIP) within two years to assure downwind states are protected.

More information on the final rule is available here.

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