Leavitt said the utility industry must begin investing now to reduce emissions of sulfur dioxide (SO2), nitrogen oxides (NOx) and mercury from power plants.
He noted that EPA last month sent letters to the governors of 31 states affirming that more than 530 counties were unable to meet new health-based ozone standards. "Many of those counties have unhealthy air through no fault of their own," he said, "It's because they live downwind from one or more coal-burning power plants."
In December 2003, EPA proposed a suite of integrated air actions to significantly reduce current levels of power plant emissions. The Interstate Air Quality proposal would utilize a cap and trade program based on EPA's highly successful Acid Rain Program to cut emissions of SO2 by 70 percent and NOX by approximately 65 percent from today's levels. The agency's proposed rule to regulate mercury emissions would cut by 70 percent the estimated 48 tons of mercury emitted each year by coal-burning power plants in the United States.
"I intend to be very aggressive in keeping these proposals on a tight, fast track. In return, I ask you to be equally aggressive in committing to cleaning up the air America breathes," said Leavitt told the top officials of U.S. utility plants.
"These rules constitute a move away from a command-and-control style regulation, adopting a market-oriented cap and trade system where the operators of the power plants find the best ways, the fastest ways, and the most efficient ways to make the reductions," Leavitt added. "It provides incentives to do more than required and serious market-imposed sanctions for those who do less."
In the meantime, utilities are now able to take advantage of changes to the New Source Review Program that allow them to spend as much as allowed as much as 20 percent of the cost of replacing a plant's essential production equipment to be spent while allowing the owner to be exempt from installing any pollution controls. In the past, utilities were required to install anti-pollution devices whenever physical or operational changes increased air pollution.