By Brett Rosenberg
July 19, 2010

The Environmental Protection Agency on July 6 announced proposed rules to further regulate sulfur dioxide (SO2) and nitrogen oxides (NOX) emissions, the main ingredients in soot and smog, respectively, from coal-burning power plants. The proposal, known as the “transport rule,” focuses on 31 states in the eastern half of the U.S. and the District of Columbia. It is intended to ease the burden that downwind states bear in controlling pollution within their borders that blows in from out of state.

According to EPA models, in addition to eliminating millions of tons per year of airborne pollutants, the rule will save in between 14,000 and 36,000 lives annually and avoid hundreds of thousands of respiratory and other illnesses. All told, the EPA estimates that the value of annual health and welfare benefits will fall in the $120 billion to $290 billion range. The cost to industry for new pollution control measures, according to the EPA, will be $2.8 billion annually.

The transport rule, once it takes effect in 2012, will have immediate beneficial effects on public health, while also improving overall visibility and reducing acid rain and its impacts. The EPA estimates that by 2014, SO2 and NOX emissions will fall to 71 percent and 52 percent below 2005 levels, respectively.

The rule stems from the fallout of the 2008 court-ordered dismantling of the 2005 Clean Air Interstate Rule, or CAIR, which would have allowed a cap-and-trade mechanism to reduce SO2 and NOX emissions. The U.S. Circuit Court of Appeals for the District of Columbia called CAIR’s trading system “fundamentally flawed,” claiming that it relied too heavily on costs and technological factors and did not appropriately “connect the states.” EPA’s newly proposed transport rule maintains the emissions reductions from CAIR, but lays out alternative means to achieve them. In its preferred option, EPA would set an emissions budget, similar to a diet, for the affected states, and allow limited trading among power plants so long as states were meeting their pollution control obligations. Other approaches would involve similar caps for each state with trading allowed only on an intrastate bases or emissions averaging among power plants within individual states.

ions averaging among power plants within individual states.

These alternatives and other aspects of the transport rule will be open to public comment for 60 days once officially published in the Federal Register. The EPA will also offer public hearings throughout the country.