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Clear Skies in Kansas

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Highlights of Clear Skies in Kansas

• Kansas sources would reduce emissions of SO2 by 12%, NOx by 74%, and mercury by 53% by 2020 due to Clear Skies.
  
• The health benefits in Kansas would total $940 million ($180 million under the alternative estimate) and include 100 fewer premature deaths (70 under the alternative estimate) and 200 fewer hospitalizations/emergency room visits for asthma.
  
• In addition, Kansas would receive environmental benefits including reduced nitrogen deposition to the Mississippi and Missouri River watersheds.
• Clear Skies does not significantly impact electricity prices. With or without Clear Skies, electricity prices in the electricity supply region that includes Kansas are expected to remain below 2000 prices.
  

Clear Skies: An Innovative Approach to Improving Human Health and the Environment

Why Clear Skies?

• Air quality has improved, but serious concerns persist
  • Kansas's citizens suffer ill effects from air pollution, including asthma attacks and premature death.
• Electricity generation sector remains a major emissions source
• Very cost-effective to control the power sector, relative to other sources
• Sources are concerned about upcoming complex and burdensome regulations.

Advantages of the Clear Skies Approach

• Guarantees significant nationwide emissions reductions - beginning years before full implementation
• Kansas sources would substantially reduce emissions of SO2, NOx, and mercury
• Delivers dramatic progress towards achievement of critical health and environmental goals.
• Uses proven, market-based flexible approach with incentives for innovation
  • Recognizes environmental needs as well as industry constraints, allowing industry to better manage
    its operations and finances while lowering risks to the public
    
  • Sources are projected to install pollution controls to enable continued reliance on coal.
• Increases certainty across the board for industry, regulators, and consumers.

Under Current Clean Air Act Power Plants Would Face a Complex Set of Requirements

For a larger image, click here.

Clear Skies Sets a Firm Timeline for Emission Reductions

The existing Title IV SO2 cap-and-trade program provides an incentive and a mechanism to begin reductions upon enactment of Clear Skies years before regulatory action under the current Act.

2004: The NOx SIP call (summertime NOx cap in 19 Eastern States + D.C.)

2008: Clear Skies NOx Phase I (2.1 million ton annual cap assigned to two Zones with trading programs)

2010:

• Clear Skies Hg Phase I (26 ton annual cap with a national trading program)
• SO2 Phase I (4.5 million ton annual cap with a national trading program)

2018:

• Clear Skies NOx Phase II (1.7 million ton annual cap assigned to two Zones with trading programs)
• Clear Skies Hg Phase II (15 ton annual cap with a national trading program)
• Clear Skies SO2 Phase II (3.0 million ton annual cap with a national trading program)

The West Faces Unique Challenges

• Environmental effects of power plant emissions - including visibility impairment and acid deposition - are broadly distributed
• Increasing ground-level ozone concentrations in national parks
• Particle-related haze in national parks and wilderness areas
• Nitrogen deposition in high elevation ecosystems (e.g., Colorado Front Range)
• Brown clouds in major cities
• Few western non-attainment areas are due to stationary source emissions

Emissions in Kansas under Clear Skies

Emissions in Kansas (2020) would be reduced from 2000 levels: 50% reduction in SO2 emissions 70% reduction in NOx emissions 44% reduction in mercury emissions

Emissions: Current (2000) and Existing Clean Air Act Regulations (base case*) vs. Clear Skies in Kansas in 2010 and 2020

Note: The base case using IPM includes Title IV, the NOx SIP Call, NSR settlements, and state-specific caps in CT, MA, MO, NC, NH, TX, and WI. It does not include mercury MACT in 2007 or any other potential future regulations to implement the current air quality standards or other parts of the Clean Air Act. Base case emissions in 2020 will likely be lower due to state and federal regulatory actions that have not yet been promulgated.

SO2 and NOx Emissions Reductions under Clear Skies

Emissions in Kansas and surrounding states would decrease considerably. These emission reductions would help Kansas maintain compliance with national air quality standards.

Note: The base case using IPM includes Title IV, the NOx SIP Call, NSR settlements, and state-specific caps in CT, MA, MO, NC, NH, TX, and WI. It does not include mercury MACT in 2007 or any other potential future regulations to implement the current ambient air quality standards or other parts of the Clean Air Act. Base case emissions in 2020 will likely be lower due to state and federal regulatory actions that have not yet been promulgated.

Clear Skies Health and Air Quality Benefits in Kansas

By 2020, Kansas would receive approximately $940 million in annual health benefits from reductions in fine particle and ozone concentrations alone due to Clear Skies. (see note 1)

Improve Public Health

• Reduced ozone and fine particle exposure by 2020 would result in public health benefits of:
  • approximately 100 fewer premature deaths each year (see note 1)
  • approximately 80 fewer cases of chronic bronchitis each year
  • approximately 200 fewer nonfatal heart attacks each year
  • approximately 300 fewer hospital and emergency room visits each year
  • approximately 15,000 fewer days workers are out sick due to respiratory symptoms each year
  • approximately 3,900 fewer school absences each year

• Reduced mercury emissions would reduce exposure to mercury through consumption of contaminated fish, resulting in additional, unquantified benefits to those who eat fish from lakes, streams, coastal waters where mercury contamination is a problem.

Help Maintain Health-Based Air Quality Standards (see note 2)

• All counties in Kansas are currently expected to meet the 8-hour ozone and fine particle standards.
• Clear Skies would reduce concentrations of ozone and fine particles throughout Kansas, causing additional benefits to public health.

Clear Skies Environmental Benefits in Kansas

In comparison to existing programs,

• Visibility would improve perceptibly.
  • The value of this benefit for Kansas is $22 million.
• Sulfur deposition, a primary cause of acid rain, would decrease by 15-30% in eastern Kansas and up to 15% in the western half of the state.
• Nitrogen deposition, a cause of damage to nitrogen-sensitive coastal waters, including the Gulf of Mexico hypoxia zone, would decrease 5-20% in eastern Kansas
• Mercury deposition would decrease by up to 15% in the easternmost part of the state.*

* These results are based on modeling the Clear Skies mercury cap without triggering the safety valve.

Electricity Generation in Kansas under Clear Skies

Current and Projected Generation by Fuel Type in Kansas under Clear Skies (GWh)

Kansas's electricity growth is projected to be met by increases in coal-fired generation. Clear Skies does not significantly alter this projection. Electricity from coal-fired generation will increase by 30% from 1999 to 2020.

Kansas's sources are projected to reduce their emissions through the installation of emission controls, rather than through a switch from coal to natural gas. In 2010, 85% of Kansas's coal-fired generation is projected to come from units with advanced SO2 and/or NOx control equipment that also substantially reduce mercury emissions; in 2020, the percentage is projected to decrease to 83%. No coal-fired units in Kansas are projected to be removed from operation as a result of Clear Skies

Emission Controls in Kansas under Clear Skies

Under Clear Skies by 2020... 74% of coal-fired capacity would install SCR No scrubbers would be installed.

The major generation companies in Kansas include: Western Resources, Inc. Kansas City Power & Light Company Kansas Gas & Electric Company Total coal-fired capacity in Kansas is projected to be 5,219 MW in 2010.

Units in Kansas Projected to Be Retrofitted Due to Clear Skies by 2020

Plant Name	Unit ID	Technology
JEFFREY ENERGY CENTER	1	SCR*
JEFFREY ENERGY CENTER	2	SCR*
JEFFREY ENERGY CENTER	3	SCR*
LA CYGNE	1	SCR*
LA CYGNE	2	SCR*
LAWRENCE	5	SCR*

* Retrofit was installed under Clear Skies by 2010

Note: Retrofits and total coal-fired capacity apply to coal units greater than 25 MW.

Electricity Prices in Kansas under Clear Skies

With or without Clear Skies, retail prices in the North American Electric Reliability Council (NERC) SPP region (the electricity supply region that contains Kansas) are projected to increase between 2005 and 2020. With Clear Skies, retail prices are projected to be approximately 0.8 - 4.0% higher between 2005 and 2020 than in the absence of the legislation.

In 2000, the average retail electricity price in Kansas was approximately 6.3 cents/kWh, which was below the average national retail price of approximately 6.7 cents/kWh.

Note: The base case using IPM includes Title IV, the NOx SIP Call, NSR settlements, and state-specific caps in CT, MA, MO, NC, NH, TX, and WI. It does not include mercury MACT in 2007 or any other potential future regulations to implement the current ambient air quality standards or other parts of the Clean Air Act. Base case emissions in 2020 will likely be lower due to state and federal regulatory actions that have not yet been promulgated.

Costs and Benefits in Kansas under Clear Skies

Benefits Outweigh the Costs

Clear Skies.... Guarantees significant emissions reductions - beginning years before full implementation Uses a proven and flexible market-based approach with incentives for innovation Increases certainty across the board for industry, regulators, and consumers

• In Kansas, Clear Skies is projected to cost approximately $37 million annually by 2020 while providing health benefits totaling approximately $960 million annually.
• The increases in production costs under Clear Skies represent only a small percentage of total retail electricity sales revenue in Kansas.
  • Retail electricity sales revenue in Kansas was $2.2 billion in 2000.
  • Adjusting these sales revenues by the same growth rate used for the modeling of costs would result in revenues of almost $3.4 billion annually in 2020.
• Nationwide, the projected annual costs of Clear Skies (in $1999) are $4.3 billion in 2010 and $6.3 billion in 2020; the nationwide benefits of Clear Skies are expected to be over $113 billion annually by 2020.
  • An alternative estimate projects annual health benefits totaling $23 billion.

Note: Costs include capital costs, fuel, and other operation and maintenance costs (both fixed and variable) associated with the achievement of the emissions caps in the legislation (for example, the installation and operation of pollution controls). These state-level production costs are estimates; they do not account for the costs associated with the transfer of electricity across regions, nor the costs or savings that could be associated with allowance movement between sources.

Notes on EPA's Analysis

• The information presented in this analysis reflects EPA's modeling of the Clear Skies Act of 2003.
  • EPA has updated this information to reflect modifications:
    • Changes included in the Clear Skies Act of 2003.
    • Revisions to the Base Case to reflect newly promulgated rules at the state and federal level since the initial analysis was undertaken.
  • The Clear Skies modeling results presented include the safety valve feature
• This analysis compares new programs to a Base Case (Existing Control Programs), which is typical when calculating costs and benefits of Agency rulemakings.
• The Base Case reflects implementation of current control programs only:
  • Does not include yet-to-be developed regulations such as those to implement the National Ambient Air Quality Standards.
• The EPA Base Case for power sector modeling includes:
  • Title IV, the NOx SIP Call, NSR settlements, and state-specific caps in Connecticut, Massachusetts, Missouri, New Hampshire, North Carolina, Texas, and Wisconsin finalized before March 2003.
• For air quality modeling, the Base Case also includes federal and state control programs, as well as the Tier II, Heavy Duty Diesel, and Nonroad Diesel rules.





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1. An alternative methodology for calculating health-related benefits projects approximately 70 premature deaths prevented and $180 million in health benefits each year in Kansas by 2020.

2. Based on 1999-2001 data for counties with monitors that have three years of complete data.

State information based on EPA's modeling of the Clear Skies Act of 2002 is presented here for archival reasons. Clear Skies in Kansas 2002 (PDF 339KB)






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