U.S. EPA proposes approval of Illinois variance on coal plant emissions

The U.S. Environmental Protection Agency is proposing to approve as part of the Illinois Regional Haze State Implementation Plan (SIP) a variance for the electrical generating units (EGUs) included in the Ameren multi-pollutant standard group (Ameren MPS Group).

The Ameren MPS Group consists of five facilities owned by Illinois Power Holdings LLC (IPH) and two facilities owned by AmerenEnergy Medina Valley Cogen LLC. The Illinois Environmental Protection Agency (IEPA) submitted the variance to the federal EPA for approval in September 2014. Comments on this proposal must be received within 30 days after planned publication in the April 20 Federal Register.

Illinois is using its MPS system, which required emissions reductions from mostly coal-fired power plants well ahead of equivalent federal standards, to help it comply with the U.S. EPA’s regional haze rule. The MPS establishes an overall SO2 annual emission rate for EGUs in the Ameren MPS group of 0.50 pounds per million Btu (lb/mmBtu) for calendar years 2010 through 2013. It also establishes an overall SO2 annual emission rate for EGUs in the Ameren MPS group of 0.43 lb/mmBtu for calendar year 2014. It establishes an overall SO2 annual emission rate for EGUs in the Ameren MPS group of 0.25 lb/mmBtu for calendar years 2015 and 2016. And it establishes an overall SO2 annual emission rate for EGUs in the Ameren MPS group of 0.23 lb/mmBtu beginning in calendar year 2017 and continuing each calendar year thereafter.

In November 2013, the Illinois Pollution Control Board (IPCB) granted IPH and Medina Valley a variance from certain MPS requirements of for a period beginning Jan. 1, 2015, through Dec. 31, 2019, and from other requirements for a period beginning Jan. 1, 2017, through Dec. 31, 2019, subject to certain conditions. IEPA submitted the variance as a revisions to the Illinois Regional Haze SIP in September 2014.

The IPH facilities included in the Ameren MPS group and subject to the variance include these coal-fired plants: Coffeen Energy Center (Montgomery County), Duck Creek Energy Center (Fulton County), E.D. Edwards Energy Center (Peoria County), Joppa Energy Center (Massac County), and Newton Energy Center (Jasper County). The two Medina Valley facilities included in the Ameren MPS group and subject to the variance are the Meredosia Energy Center (Morgan County) and the Hutsonville Energy Center (Crawford County).

This variance was granted subject to numerous conditions including:

  • The IPH facilities in the Ameren MPS group must comply with an overall SO2 annual emission rate of 0.35 lb/million Btu from January 2015 through December 2019, and an overall SO2 annual emission rate of 0.23 lb/mmBtu beginning on Jan. 1, 2020.
  • Medina Valley must not operate the EGUs at Meredosia and Hutsonville Power stations until after Dec. 31, 2020, except that the FutureGen 2.0 coal project at the Meredosia Energy Center is exempt from this restriction.
  • Through December 2019, IPH must continue to burn low sulfur coal at the E.D. Edwards, Joppa, and Newton Energy Centers. The combined annual average stack SO2 emissions of these three stations must not exceed 0.55 lb/mmBtu on a calendar year annual average basis.
  • Through December 2019, IPH must operate the existing Flue Gas Desulfurization systems at the Duck Creek and Coffeen Energy Centers to achieve a combined SO2 removal rate of at least 98% on a calendar year annual average basis.
  • IPH must permanently retire the coal-fired, 90-MW E.D. Edwards Unit 1 as soon as allowed by the Midcontinent Independent System Operator.
  • Beginning October 2013, through December 2020, IPH must limit the MPS Group systemwide mass emissions of SO2 to no more than 327,996 tons.
  • There is a schedule for completing the flue gas desulfurization project at the Newton Power Station, with major equipment components in position by September 2019, and requirements for IPH to file annual progress reports with IEPA from 2013 through 2019.

Said the April 20 U.S. EPA notice: “The variance will not result in any increase in SO2 emissions, but rather will result in fewer SO2 emissions over the 2013-2020 time period. In addition, the measures contained in the variance provide better visibility protection than the application of [best available retrofit technology] on BART-subject units. Therefore, the variance will not interfere with attainment, reasonable further progress, or any other applicable requirement of the [Clean Air Act].”

Ameren (NYSE: AEE) in late 2013 completed the divestiture of its largely coal-fired merchant generation business, formerly known as Ameren Energy Resources Co. LLC (AER), to an affiliate of Dynegy Inc. (NYSE: DYN). That deal included the IPH plants.

Said Dynegy’s Feb. 25 annual Form 10-K report about this situation: “For the IPH facilities, the MPS imposes declining limits that started in 2009 for mercury and in 2010 for NOx and SO2. Compliance with the MPS’ final SO2 limit is required beginning in 2017. The IPCB has granted IPH a variance which provides additional time for economic recovery and related power price improvements necessary to support the installation of flue gas desulfurization (i.e. scrubber) systems at the Newton facility such that the IPH coal-fired fleet in Illinois can meet the MPS system-wide SO2 limit.

“The IPCB approved the proposed plan to restrict the SO2 emissions through 2014 to levels lower than those required by the MPS to offset any environmental impact from the variance. The IPCB’s order also included a schedule of milestones for completion of various aspects of the installation of the Newton scrubber systems. The first milestone relates to the completion of engineering design by July 2015, while the last milestone relates to major equipment components being placed into final position on or before September 1, 2019. The variance also requires additional environmental protections in the form of enforceable commitments to cap the IPH system’s SO2 emissions by December 31, 2020, retire Edwards Unit 1 as soon as permitted by the MISO, and, during the variance period, use only low sulfur coal at the Newton, Edwards and Joppa facilities and maintain operation of the existing scrubbers at the Duck Creek and Coffeen facilities to achieve a 98 percent annual average SO2 removal rate.

“In January 2014, an environmental group filed a petition for review of the IPCB’s decision and order granting the variance relief in the Illinois Fourth District Appellate Court. In response, we filed a Motion to Dismiss, and on February 24, 2014, the Appellate Court granted our motion and dismissed the appeal. The environmental group then petitioned for leave to appeal the Appellate Court’s decision with the Illinois Supreme Court, which we opposed. On September 24, 2014, the Illinois Supreme Court denied the petition for leave to appeal.”

About Barry Cassell 20414 Articles
Barry Cassell is Chief Analyst for GenerationHub covering coal and emission controls issues, projects and policy. He has covered the coal and power generation industry for more than 24 years, beginning in November 2011 at GenerationHub and prior to that as editor of SNL Energy’s Coal Report. He was formerly with Coal Outlook for 15 years as the publication’s editor and contributing writer, and prior to that he was editor of Coal & Synfuels Technology and associate editor of The Energy Report. He has a bachelor’s degree from Central Michigan University.