Environmental Issues: Air

This report examines and compares the air pollutant emissions of the 100 largest power producers in the United States based on 2008 plant ownership and emissions data. Table ES.1 lists the 100 largest power producers featured in this report ranked by their total electricity generation from fossil fuel, nuclear, and renewable energy facilities. These producers include public and private entities (collectively referred to as "companies" or "producers" in this report) that own roughly 2,200 power plants and account for 85 percent of reported electric generation and 89 percent of the industry's reported emissions.

The report focuses on four power plant pollutants for which public emissions data are available: sulfur dioxide (SO2), oxides of nitrogen (NOx), mercury (Hg), and carbon dioxide (CO2). These pollutants are associated with significant environmental and public health problems, including acid deposition, global warming, fine particle air pollution, mercury deposition, nitrogen deposition, ozone smog, and regional haze. The report benchmarks, or ranks, each company's absolute emissions and its emission rate (determined by dividing emissions by electricity produced) for each pollutant against the emissions of the other companies. In addition, this report calls attention to the opportunities and risks companies may face from potential changes in environmental regulations. Becoming aware of a company's exposure to these business opportunities and risks is the first step in developing effective corporate environmental strategies.

Several issues and trends are influencing investment decisions in the U.S. electric power sector, including trends in fuel prices, technology developments, and environmental regulations. This report discusses trends in natural gas supply and prices, as well as trends in coal- and oil-fired power plant retirements. The report also examines renewable energy developments in the U.S., including wind and solar, and trends in energy efficiency investments and programs. The report also highlights numerous regulations related to air quality and climate change that are facing the electric generating sector. As these regulatory programs evolve, they will have a significant impact on electric generation in the U.S. by driving investment in lower-carbon technologies and forcing inefficient plants into retirement. In addition, the report discusses the basic structure of the U.S. electric power sector and emissions associated with delivered electricity. This analysis is intended to help inform policy and educate investors and companies on the key issues associated with the electric power industry.

Major Findings

Electric Industry Emission Trends

Since 1990, power plant emissions of SO2 and NOx have decreased and CO2 emissions have increased.

• SO2 and NOx emissions from power plants have decreased since 1990 due in large part to programs implemented under the 1990 Clean Air Act Amendments. In 2008, power plant SO2 emissions were 52 percent lower and NOx emissions were 54 percent lower than they were in 1990.



• CO2 emissions from power plants are not currently regulated at the federal level. In 2008, power plant CO2 emissions were 30 percent higher than they were in 1990. However, in 2008, CO2 emissions from electric power generation declined by 2.1 percent from 2007 levels due in part to reduced electricity sales resulting from a weakened economy and increased renewable generation.¹ Congress is currently considering legislation that would regulate CO2 emissions from power plants and other sources of greenhouse gas emissions, and in December 2009, the U.S. Environmental Protection Agency (EPA) signed the greenhouse gas endangerment finding that prepares EPA to establish federal emissions standards for greenhouse gases under existing Clean Air Act authority. The finding was in response to the U.S. Supreme Court's April 2007 ruling that concluded that EPA has clear statutory authority to regulate greenhouse gases (Massachusetts v. EPA).

Power plants only began to report their mercury emissions in 1998; therefore, longer-term emissions trends are not available.

Overall Emissions from Electricity

The electric industry in the U.S. is a major source of air pollution.

• In 2008, power plants were responsible for 66 percent of SO2 emissions, 19 percent of NOx emissions, and 72 percent of mercury air emissions in the U.S.



• The electric industry accounts for more CO2 emissions than any other sector, including the transportation and industrial sectors. The electric industry is responsible for about 39 percent of CO2 emissions in the U.S.

Air Pollution Rankings and Comparisons

The 100 largest power producers generated 85 percent of electric power in the U.S. in 2008. The 100 largest producers generated 97 percent of all nuclear power, 91 percent of all coal-fired power, 83 percent of all hydroelectric power, 73 percent of all natural gas-fired power, and 52 percent of all non-hydroelectric renewable power.

Air pollution emissions from power plants are highly concentrated among a small number of producers. For example, almost a quarter of the electric power industry's SO2 and CO2 emissions are emitted by just two and five top 100 producers, respectively. Figure ES.1 summarizes the distribution of emissions among electric power producers.

Electric power producers' emission levels and emission rates vary significantly due to the amount of power produced, the efficiency of the technology used in producing the power, the fuel used to generate the power, and installed pollution controls. In 2008, total generation among the 100 largest power producers varied from 6.4 million megawatt hours to 200 million megawatt hours and:

• SO2 emissions ranged from zero to 827,413 tons, and SO2 emission rates ranged from zero to 16.1 pounds per megawatt hour;



• NOx emissions ranged from zero to 261,973 tons, and NOx emission rates ranged from zero to 4.3 pounds per megawatt hour;



• CO2 emissions ranged from zero to 171 million tons, and CO2 emission rates ranged from zero to 2,408.4 pounds per megawatt hour;



• Mercury emissions from producers with coal plants ranged from 7 to 8,110 pounds, and mercury emission rates ranged from 0.001 to 0.19 pounds per gigawatt hour.

Electric power producers' mercury emissions from coal plants ranged from 0 to 8,719 pounds, and mercury emission rates ranged from 0.0 lbs/GWh to 0.105 lbs/GWh.

Using this Report

The information in this report supports informed decision-making in several areas:

• It can be used by policymakers who are addressing the public health and environmental risks of SO2, NOx, mercury, and CO2 emissions.



• It can be used by the investment community to assess the costs and business risks associated with compliance with future additional emission reduction requirements.



• It can be used by electric power companies and the public to assess corporate performance relative to key competitors, prior years, and industry benchmarks.

¹ U.S. Energy Information Administration (EIA). "Emissions of Greenhouse Gases in the United States 2008." December 2009. p.16.