Cross-State Air Pollution Rule (CSAPR)

On July 6, 2011, the US Environmental Protection Agency (EPA) finalized a rule that protects the health of millions of Americans by helping states reduce air pollution and attain clean air standards. This rule, known as the Cross-State Air Pollution Rule (CSAPR), requires 27 states to significantly improve air quality by reducing power plant emissions that contribute to ozone and/or fine particle pollution in other states.

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This rule replaces EPA’s 2005 Clean Air Interstate Rule (CAIR). A December 2008 court decision kept the requirements of CAIR in place temporarily but directed EPA to issue a new rule to implement Clean Air Act requirements concerning the transport of air pollution across state boundaries.

In a separate but related regulatory action, EPA also issued a supplemental notice of proposed rulemaking (SNPR) to require six states – Iowa, Kansas, Michigan, Missouri, Oklahoma, and Wisconsin – to make summertime NOX reductions under the CSAPR ozone-season control program. Five of those states are already covered in the final rule for interstate fine particle pollution (PM2.5). With the inclusion of these states, a total of 26 states would be required to reduce ozone-season NOX emissions to assist in attaining the 1997 8-Hour Ozone National Ambient Air Quality Standards (NAAQS). Finalizing this supplemental proposal would bring the total number of covered states under the CSAPR to 28. EPA issued a proposal instead of a final action for these states in order to provide additional opportunity for public comment on their linkages to downwind nonattainment and maintenance areas. EPA is proposing to finalize this proposal by late fall 2011.

The final rule yields $120 to $280 billion in annual health and environmental benefits in 2014, including the value of avoiding 13,000 to 34,000 premature deaths. This far outweighs the estimated annual costs of CSAPR. The $800 million in annual projected costs of this rule in 2014, along with the roughly $1.6 billion per year in capital investments already under way as a result of CAIR, are improving air quality for over 240 million Americans. This rule will not disrupt a reliable flow of affordable electricity for American consumers and businesses. Health benefits will be achieved at a very low cost, and while the effect on prices for specific regions or states may vary, they are well within the range of normal electricity price fluctuations. Any such costs will be greatly outweighed by the benefits.

The rule, which comes in response to a federal appeals court order that forced the EPA to strengthen previous air quality rules, are designed to stop emissions from one state blowing into another, and apply only to states where there is a risk of air pollution crossing borders.

Connecticut, Delaware, Florida, Louisiana, Massachusetts and the District of Columbia were dropped from the final EPA rule. But in a surprise move the EPA confirmed that Texas would be covered by the new targets, prompting a furious response from Republican governor and potential presidential candidate Rick Perry.

Fox News and coal companies are trying to fight the rule.

The costs of the EPA’s actions against industry and the economy are real. In anticipation of the EPA’s new requirements, American Electric Power (AEP), an Ohio based utility, announced in June it was closing five power plants and will be scaling back operations at six additional facilities.

The Environmental Protection Agency’s plan to cut interstate air pollution through a cap-and-trade system may face legal challenges.

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