EPA Releases Affordable Clean Energy Rule to Replace the Clean Power Plan

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On June 19, 2019, the U.S. Environmental Protection Agency (EPA) issued the final version of the Affordable Clean Energy (ACE) rule. The rule is the result of a multi-year process, which repeals the Clean Power Plan and gives states three years to submit compliance plans under new guidelines. According to EPA, “ACE establishes heat rate improvement (HRI), or efficiency improvement, as the best system of emission reduction (BSER) for CO2 from coal-fired existing generation units.” This focus on efficiency at coal plants is in contrast to the Clean Power Plan, which set the BSER based off emissions from a full range of available generation options. 

The rule sets six candidate technologies to improve coal plant efficiency: 1) neural networks/intelligent sootblowers, 2) boiler feed pumps, 3) air heater and duct leakage control, 4) variable frequency drives, 5) blade path upgrade (steam turbine), and 6) redesign/replace economizer. Through ACE’s implementation, “states will establish unit-specific ‘standards of performance’ that reflect the emission limitation achievable through application of BSER technologies.” States will have three years to submit these unit-specific regulations to the EPA for approval.

According to EPA’s analysis, the ACE rule will have annual net benefits of $250-730 million or $120-450 million at discount rates of three percent and seven percent, respectively. These are calculated through expected compliance costs, offset by health and climate benefits as compared to no regulation. By 2030, the EPA expects ACE to avoid 50 to 122 premature deaths a year, and abate 11 million tons of carbon, or the equivalent of one day’s worth of oil use in the United States.