Pennsylvania coal plants face big changes under planned EPA pollution-control rules

Outside, demonstrators wore breathing masks.

Inside, a two-time cancer survivor, age 30, pleaded for the federal Environmental Protection Agency to approve a plan that would reduce air pollution from coal-fired power plants in the eastern United States.

"This rule will make the air I breathe less harmful to my already at-risk health," Martin Hage of Philadelphia said. Or, as he put it, "in the great coal state of Pennsylvania."

Indeed. Pennsylvania, a coal powerhouse, stands at the vortex of the issue.

Its residents have much to gain from the rule's health benefits. But its fleet of geriatric coal plants has much to lose.

Moreover, this and other regulations in the chute put the industry at a crossroads. Although some plants have already been upgraded, older ones may close, analysts say.

The proposed rule, debated at a hearing in Philadelphia on Thursday, is all about better breathing, fewer health problems, and lower health costs for millions of Americans, the EPA says.

The agency estimates that by the time the emission reductions are fully implemented in 2014, each year afterward they could save 36,000 lives and yield up to $290 billion in health benefits.

Pennsylvanians would benefit the most, said the EPA's Sam Napolitano, director of the Clean Air Markets Division. That is because of a high population base and potentially large emission reductions here and upwind.

As for Pennsylvania's plants, most upgrades have been made at the newer and larger ones. So about 65 percent of the state's coal-fired generating capacity already has controls that would meet the new regulations, said Douglas Biden, president of the Electric Power Generation Association, a Pennsylvania industry group.

But many older plants are facing hard decisions. Much like a family with a clunker car, they have to determine at what point it is no longer worth making more repairs.

About half of Pennsylvania's 33 plants were built before 1971. The oldest went online in 1949, the year 45 r.p.m. records made their debut.

A National Research Council study released in October showed that older plants contribute a disproportionate share of pollution. Those built in the 1960s and '70s emitted 47 percent of the sulphur dioxide attributed to coal plants but produced only 32 percent of the electricity.

Although the EPA estimates the overall cost to meet the new regulations at $2.8 billion a year - far less than the value of the health benefits - individual plants may not be able to raise the capital.

"It's fully expected that some smaller coal-fired power plants will retire," Biden said. "Eddystone and Cromby have already seen the handwriting on the wall," he said, referring to Exelon Corp. plants in Chester and Phoenixville, which will close by 2013.

Two other Pennsylvania coal plants are being converted to natural gas.

"I think that's just the tip of the iceberg," Biden said.

The change is intended to replace the Bush administration's 2005 Clean Air Interstate Rule, which a federal court nixed.

Both are a recognition that power-plant pollution isn't always a homegrown problem. States could clean up and still have dirty air because of what blows in.

The rule addresses sulphur dioxide and oxides of nitrogen - often informally referred to as SOx and NOx.

Both react in the atmosphere: NOx contributes to the formation of ground-level ozone, or smog, and SOx forms fine particles that can be inhaled deep into the lungs.

In the Mid-Atlantic region, 43 counties with 17 million residents - including Southeastern Pennsylvania and Camden and Gloucester Counties - have air that violates standards for these pollutants on some days.

Those with asthma, lung disease, or heart disease are at high risk for health effects. "We are already paying on the order of a couple of hundred billion dollars every year in lost work and productivity, in disease, disability, and death," said Kevin Stewart, director of environmental health for the American Lung Association of the Mid-Atlantic.

Air pollution can be travel hundreds of miles. It often flows east on the prevailing winds - putting eastern areas at the end of the nation's figurative tailpipe.

Pennsylvania gets emissions from 15 states, including Ohio, Missouri, Michigan, and even Alabama.

In turn, the state shares emissions with about 15 other states, notably New Jersey.

Incoming emissions are so problematic that in May Gov. Christie asked for federal help to force a coal plant across the Delaware River in Northampton County to cut emissions "in view of the serious public health violation."

Pennsylvania could be hit hard by the new rules. Though sulphur dioxide emissions are expected to drop 71 percent overall, in Pennsylvania they would have to decline 84 percent, said Joyce Epps, director of the Department of Environmental Protection's air-quality bureau.

The rule's goals for NOx, however, fall short, Epps and others contend. Though emissions would drop 52 percent overall, Pennsylvania plants would reduce them just 40 percent. They "must not be allowed to backslide," Epps said.

Companies have said that the EPA underestimates the cost and that they may be unable to meet the deadlines.

Meanwhile, the new rule is not the only one to take aim at an industry that historically has been one of the nation's biggest air polluters.

The EPA has three more rules in the pipeline that will further tighten limits on interstate transport, ozone pollution, and the emission of toxics, including mercury.

"There has never been a period of time even remotely similar to this one in terms of the number of different requirements coming down the pike," said Jeff Holmstead, a Clean Air Act expert with the law firm Bracewell & Giuliani L.L.P., which often represents electric companies.

For coal, the cascade of regulations presents a kind of high-stakes poker game. A company may ante up with a $100 million scrubber to remove sulphur dioxide, but then have to fold if new limits on emissions of toxic chemicals are just too expensive.

Companies need "clear, coordinated, and flexible regulations that provide certainty . . . to plan multibillion-dollar investments," said John Kinsman, environmental director at the Edison Electric Institute, an industry group.

Even companies that have upgraded or sold their plants - and that are largely supportive of the rule - are wary of what may come next.

PPL Corp. recently spent $1.4 billion for pollution controls on its Brunner Island plant in York County, built in 1961, and Montour in Montour County, built in 1972. Sulphur dioxide emissions at Montour fell 88 percent - from 128,000 tons in 2007 to 15,000 tons in 2009.

Both are massive "baseload" plants, running pretty much around the clock to help produce the 55 percent of electricity in this region that comes from coal.

Spokesman George Lewis said the company decided to install the equipment in advance of deadlines because "we wanted to get in the front of the line" for labor and materials, whose costs would likely only increase.

PPL also intended to sell pollution credits to plants that did not upgrade. But such a trading plan is not a certainty.

Whatever form the final rule takes, many of those who testified at Thursday's EPA hearing emphasized that the plan is meant to address health, not the bottom line.

"Otherwise," said Nick Rogers, a Philadelphia cyclist and asthmatic, "I and people like me will cost the government and private insurance companies billions of dollars in health-care costs."