Regulatory Impact Analysis for the New Source Performance Standards Review for Stationary Combustion Turbines


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Regulatory Impact Analysis for the New
Source Performance Standards Review for
Stationary Combustion Turbines

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EPA-452/R-24-016
November 2024

Regulatory Impact Analysis for the New Source Performance Standards Review for

Stationary Combustion Turbines

U.S. Environmental Protection Agency
Office of Air Quality Planning and Standards
Health and Environmental Impacts Division
Research Triangle Park, NC

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CONTACT INFORMATION

This document has been prepared by staff from the Office of Air Quality Planning and
Standards, U.S. Environmental Protection Agency. Questions related to this document
should be addressed to U.S. Environmental Protection Agency, Office of Air Quality
Planning and Standards, C439-02, Research Triangle Park, North Carolina 27711 (email:
oaqpseconomics@epa.gov).

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CONTENTS

List of Tables	vii

List of Figures	viii

1	Introduction	1

1.1	Background	1

1.2	Legal Basis for this Rulemaking	1

1.3	Economic Basis for this Rulemaking	3

1.4	Regulatory History	4

1.5	Proposed Requirements	7

1.6	Organization of this RIA	12

2	Combustion Turbine Technologies and Costs	13

2.1	Introduction	13

2.2	Simple-Cycle Combustion Turbine Technologies	13

2.3	Combined-Cycle Combustion Turbines Technologies	14

2.4	Capital and Installation Costs	15

2.5	Affected Producers	17

2.6	Projected Growth of Combustion Turbines	20

3	Engineering Cost Analysis	22

3.1	Introduction	22

3.2	Affected Sources	22

3.3	Capital Investment, Annual Costs, and Emissions Reductions	23

3.4	Secondary Impacts	25

3.5	Characterization of Uncertainty	26

4	Benefits of Emissions Reductions	27

4.1	Introduction	27

4.2	Approach to Estimating PIVh.s-related Human Health Benefits	27

4.2.1	Selecting Air Pollution Health Endpoints to Quantify	28

4.2.2	Quantifying Cases of PM2.5-Attributable Premature Death	30

4.2.3	Ozone-related Human Health Benefit	31

4.2.4	Estimating Ozone-related Health Impacts	31

4.2.5	Selecting Air Pollution Health Endpoints to Quantify	32

4.2.6	Quantifying Cases of Ozone-Attributable Premature Mortality	33

4.3	Economic Valuation	35

4.3.1	Benefit-per-Ton Estimates	37

4.3.2	Total Health Benefits - PM2.5- and Ozone- Related Benefits Results	41

4.4	Benefits of Sulfur Dioxide Reductions	44

4.5	Disbenefits from Increased Ammonia Emissions	45

4.6	Disbenefits from Increased CO2 Emissions	46

4.7	Characterization of Uncertainty in Monetized Health Benefits	48

5	Environmental Justice Analysis	50

5.1	Introduction	50

5.2	Demographic Analysis	51

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6	Economic and Small Business Impacts	55

6.1	Introduction	55

6.2	Screening Analysis	55

6.2.1	Identification of Small Entities	56

6.2.2	Small Business Impacts Analysis	58

6.3	Economic Impacts	59

6.4	Employment Impacts	59

7	Comparison of Costs and Benefits	61

7.1	Results	61

7.2	Shadow Price of Capital	61

7.3	Uncertainties and Limitations	63

8	References	65

Appendix A: Selecting a BPT	73

A.1 Overview of BPTs	74

A.2 Applying BPTs to Unmodeled Sectors	78

A.2.1 The Combustion Turbine Sector	78

A. 3 Analytic U ncertainty	8 0

A.4 References	80

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LIST OF TABLES

Table 1 Current NOx Emission Standards for Stationary Combustion Turbines	5

Table 2 Proposed Subcategories and NOx Standards for Subpart KKKKa	10

Table 3 Utility-scale Gas Turbine Power Plant Capital Cost Estimates (million 2022$ unless

otherwise noted)	16

Table 4 Combustion Turbines over 10 MMBtu/h or equivalent by NAICS code	17

Table 5 Number of Firms and Establishments, Employment, and Annual Payroll for Affected

Industries: 2021	20

Table 6 Types of Combustion Turbines Constructed 2019-2023 and Installed Controls	21

Table 7 Estimated Number of New, Modifed, or Reconstructed Turbines in Each Year	22

Table 8 Summary of Estimated Undiscounted Costs and Emission Reductions in First 8 Years

After the Rule is Final	24

Table 9 2024 Present Value and Equivalent Annualized Value (million 2023$)	24

Table 10 Estimated Increased Ammonia and CO2 Emissions Associated with NOx Emission

Reductions	26

Table 11 Human Health Effects of PM2.5 and whether they were Quantified and/or Monetized in

thisRIA	29

Table 12 Human Health Effects of Ambient Ozone and whether they were Quantified and/or

Monetized in this RIA	33

Table 13 Mapping from BPT Years to Modeled Years	41

Table 14 BPT values for national industrial boilers used in BPT estimation	41

Table 15 Monetized Value, Present Value, and Equivalent Annualized Value of NOx Emission

Reductions from Proposed NSPS 2025-2032 (millions, 2023$)	42

Table 16 BPT values for EGUs and Oil & Natural Gas Transmissions used in Benefits Estimation.43
Table 17 Monetized Value, Present Value, and Equivalent Annualized Value of NOx Emission
Reductions from Proposed NSPS 2025-2032 (millions, 2023$) of Industrial Boilers,

EGUs, and Oil & Gas Transmission	44

Table 18 Monetized Value, Present Value, and Equivalent Annualized Value of Ammonia Emission

Increases from Proposed NSPS 2025-2032 (millions, 2023$)	45

Table 19 Discounted Monetized Value, Present Value, and Equivalent Annualized Value of CO2

Emissions Changes from Proposed Rule 2025-2032 (millions, 2023$)	48

Table 20 Proximity Demographic Assessment Results for Stationary Combustion Turbines NSPS53

Table 21 Affected NAICS Codes and SBA Small Entity Size Standards	57

Table 22 Summary of Benefits, Costs and Net Benefits for the Proposed NSPS for Combustion

Turbines from 2025 to 2032 (millions, 2023$)	61

Table 23 Sensitivity of Net Benefits to Potential Impacts on Capital Investment (Million 2023$)..63
Table 24 National BPTs for 2025	77

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LIST OF FIGURES

Figure 1 Simple- Cycle Gas Turbine	14

Figure 2 Combined-Cycle Gas Turbine	15

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1 INTRODUCTION

1.1	Background

The Environmental Protection Agency (EPA) is proposing Standards of Performance
for new, modified, and reconstructed stationary combustion turbines and stationary gas
turbines based on the preliminary results of a review of available control technologies for
limiting emissions of criteria air pollutants. This review of the new source performance
standards (NSPS) is required by the Clean Air Act (CAA).

As a result of this review, the EPA is proposing to establish size-based subcategories
for new and reconstructed stationary combustion turbines that also recognize distinctions
between those that operate at varying loads or capacity factors and those firing natural gas
or non-natural gas fuels. In general, the EPA is proposing that combustion controls with the
addition of post-combustion selective catalytic reduction (SCR) is the best system of
emission reduction (BSER) for limiting nitrogen oxide (NOx) emissions from this category,
with certain, limited exceptions.

Based on this and other updates in technical information, the EPA is proposing to
lower the NOx standards of performance for most of the combustion turbines subcategories
included in this source category. In addition, for new and reconstructed stationary
combustion turbines that fire or co-fire using hydrogen, the EPA is proposing to ensure that
those sources are subject to the same level of control for NOx emissions as sources firing
natural gas or non-natural gas fuels, depending on the percentage of hydrogen fuel being
utilized. The EPA is proposing to maintain the current standards for sulfur dioxide (SO2)
emissions, because after reviewing the current SO2 standards, we have concluded that no
change is warranted. Finally, the Agency is proposing amendments to address specific
technical and editorial issues to clarify the existing regulations.

1.2	Legal Basis for this Rulemaking

The EPA's authority for this proposed rule is CAA section 111, which governs the
establishment of standards of performance for stationary sources. Section 111(b)(1)(A) of
the CAA requires the EPA Administrator to list categories of stationary sources that in the
Administrator's judgment cause or contribute significantly to air pollution that may

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reasonably be anticipated to endanger public health or welfare. The EPA must then issue
performance standards for new (and modified or reconstructed) sources in each source
category pursuant to CAA section 111(b)(1)(B). These standards are referred to as new
source performance standards, or NSPS. The EPA has the authority to define the scope of
the source categories, determine the pollutants for which standards should be developed,
set the emission level of the standards, and distinguish among classes, types, and sizes
within categories in establishing the standards.

CAA section 111(b)(1)(B) requires the EPA to "at least every 8 years review and, if
appropriate, revise" new source performance standards. However, the Administrator need
not review any such standard if the "Administrator determines that such review is not
appropriate in light of readily available information on the efficacy" of the standard.

In setting or revising a performance standard, CAA section 111(a)(1) provides that
performance standards are to reflect "the degree of emission limitation achievable through
the application of the BSER which (taking into account the cost of achieving such reduction
and any nonair quality health and environmental impact and energy requirements) the
Administrator determines has been adequately demonstrated." The term "standard of
performance" in CAA section 111(a)(1) makes clear that the EPA is to determine both the
BSER for the regulated sources in the source category and the degree of emission limitation
achievable through application of the BSER. The EPA must then, under CAA section
111(b)(1)(B), promulgate standards of performance for new sources that reflect that level
of stringency. CAA section 111(b)(5) generally precludes the EPA from prescribing a
particular technological system that must be used to comply with a standard of
performance. Rather, sources can select any measure or combination of measures that will
achieve the standard.

Pursuant to the definition of new source in CAA section 111(a)(2), standards of
performance apply to facilities that begin construction, reconstruction, or modification
after the date of publication of the proposed standards in the Federal Register. Under CAA
section 111(a)(4), "modification" means any physical change in, or change in the method of
operation of, a stationary source which increases the amount of any air pollutant emitted
by such source or which results in the emission of any air pollutant not previously emitted.

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Changes to an existing facility that do not result in an increase in emissions are not
considered modifications. Under the provisions in 40 CFR 60.15 (subject to any variation in
the category-specific NSPS regulations), reconstruction means the replacement of
components of an existing facility such that: (1) the fixed capital cost of the new
components exceeds 50 percent of the fixed capital cost that would be required to
construct a comparable entirely new facility; and (2) it is technologically and economically
feasible to meet the applicable standards. Pursuant to CAA section 111(b)(1)(B), the
standards of performance or revisions thereof shall become effective upon promulgation.

1.3 Economic Basis for this Rulemaking

Regulation can be used to address market failures, which otherwise lead to a
suboptimal allocation of resources within the free market. Many environmental problems
are classic examples of "negative externalities", which arise when private entities do not
internalize the full opportunity cost of their production, and some of this opportunity cost
is borne by members of society who are neither consumers nor producers of the goods
produced (i.e., they are "external"). For example, the smoke from a factory may adversely
affect the health of nearby residents, soil quality, and visibility. Public goods such as air
quality are valued by individuals but suffer from a lack of property rights, so the value of
good air quality tends to be unpriced in the markets that generate air pollution. In such
cases, markets fail to allocate resources efficiently and regulatory intervention is needed to
address the problem.

While recognizing that the socially optimal level of pollution is often not zero, the
emissions from combustion turbines impose costs on society (e.g., negative health impacts)
that may not be reflected in the equilibrium market prices for the goods produced through
the use of combustion turbines. If emissions from combustion turbines increase risks to
human health, some social costs will be borne not by the firm and its customers but rather
imposed on communities near the combustion turbines and other individuals exposed to
their emissions. Consequently, absent a regulation limiting emissions from combustion
turbines and causing firms to internalize the external costs of their operations, emissions
will exceed the socially optimal level.

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1.4 Regulatory History

A stationary combustion turbine is defined as all equipment, including but not
limited to the combustion turbine; the fuel, air, lubrication, and exhaust gas systems;
control systems (except emission control equipment); heat recovery system (including
heat recovery steam generators (HRSG) and duct burners); and any ancillary components
and sub-components comprising any simple cycle, regenerative/recuperative cycle, and
combined cycle stationary combustion turbine, and any combined heat and power (CHP)
stationary combustion turbine-based system. Stationary means that the combustion
turbine is not self-propelled or intended to be propelled while performing its function. It
may, however, be mounted on a vehicle for portability.

Standards of performance for the source category of stationary gas turbines were
originally promulgated in 1979 in subpart GG of 40 CFR part 60 (44 FR 52798). As
promulgated in 1979, the sources subject to the NSPS are stationary combustion turbines
with a heat input at peak load equal to or greater than 10.7 gigajoules (GJ) (10 million
British thermal units per hour (MMBtu/h)), based on the lower heating value of the fuel,
that commenced construction, modification, or reconstruction after October 3,1977.

The EPA last revised the NSPS on July 6, 2006, and subpart KKKK is applicable to
stationary combustion turbines with a heat input at peak load equal to or greater than 10.7
GJ (10 MMBtu/h), based on the higher heating value (HHV) of the fuel, for which
construction, modification, or reconstruction was commenced after February 18, 2005 (71
FR 38482).

The NOx standards in subpart KKKK are based on the application of combustion
controls (as the BSER) and allow the turbine owner or operator the choice of meeting a
concentration-based emission standard or an output-based emission standard. The
concentration-based emission limits are in units of parts per million by volume dry
(ppmvd) at 15 percent oxygen (O2). The output-based emission limits are in units of mass
per unit of useful recovered energy, nanograms per Joule (ng/J) or pounds per megawatt-
hour (lb/MWh). All of the NOx limits in subpart KKKK are based on the application of
combustion controls but individual standards may differ for individual subcategories of

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combustion turbines based on the following factors: the fuel input rating at peak load, the
fuel used, the application, the load, and the location of the turbine. The fuel input rating of
the turbine does not include any supplemental fuel input to the heat recovery system and
refers to the rating of the combustion turbine itself.

Specifically, in subpart KKKK, the EPA identifies 14 subcategories of stationary
combustion turbines and establishes NOx emission limits for each. The size-based
subcategories include less than or equal to 50 MMBtu/h of heat input, greater than 50
MMBtu/h of heat input and less than or equal to 850 MMBtu/h of heat input, and greater
than 850 MMBtu/h of heat input. There are separate subcategories for combustion
turbines operating at part load, for modified and reconstructed combustion turbines, heat
recovery units operating independent of the combustion turbine, and turbines operating at
low ambient temperatures. A specific NOx performance standard ranging from 15 to 150
ppmvd is identified for each of the 14 subcategories and these standards are shown in
Table 1.

Table 1 Current NOx Emission Standards for Stationary Combustion Turbines

Combustion Turbine Type

Combustion Turbine
Heat Input at Peak Load
(HHV)

NOx Emission Standard

New turbine firing natural gas, electric
generating

< 50 MMBtu/h

42 ppm at 15 percent oxygen (O2)
or 290 ng/J of useful output (2.3
lb/MWh)

New turbine firing natural gas,
mechanical drive

< 50 MMBtu/h

100 ppm at 15 percent O2 or 690
ng/J of useful output (5.5 lb/MWh)

New turbine firing natural gas

> 50 MMBtu/h and <850
MMBtu/h

25 ppm at 15 percent O2 or 150
ng/J of useful output (1.2 lb/MWh)

New, modified, or reconstructed
turbine firing natural gas

> 850 MMBtu/h

15 ppm at 15 percent O2 or 54 ng/J
of useful output (0.43 lb/MWh)

New turbine firing fuels other than
natural gas, electric generating

< 50 MMBtu/h

96 ppm at 15 percent O2 or 700
ng/J of useful output (5.5 lb/MWh)

New turbine firing fuels other than
natural gas, mechanical drive

< 50 MMBtu/h

150 ppm at 15 percent O2 or 1,100
ng/J of useful output (8.7 lb/MWh)

New turbine firing fuels other than
natural gas

> 50 MMBtu/h and < 850
MMBtu/h

74 ppm at 15 percent O2 or 460
ng/J of useful output (3.6 lb/MWh)

New, modified, or reconstructed
turbine firing fuels other than natural
gas

> 850 MMBtu/h

42 ppm at 15 percent O2 or 160
ng/J of useful output (1.3 lb/MWh)

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Combustion Turbine Type

Combustion Turbine
Heat Input at Peak Load
(HHV)

NOx Emission Standard

Modified or reconstructed turbine

< 50 MMBtu/h

150 ppm at 15 percent O2 or 1,100
ng/J of useful output (8.7 lb/MWh)

Modified or reconstructed turbine
firing natural gas

> 50 MMBtu/h and < 850
MMBtu/h

42 ppm at 15 percent O2 or 250
ng/J of useful output (2.0 lb/MWh)

Modified or reconstructed turbine
firing fuels other than natural gas

> 50 MMBtu/h and < 850
MMBtu/h

96 ppm at 15 percent O2 or 590
ng/J of useful output (4.7 lb/MWh)

Turbines located north of the Arctic
Circle (latitude 66.5 degrees north),
turbines operating at less than 75
percent of peak load, modified and
reconstructed offshore turbines, and
turbines operating at temperatures less
than 0 °F

<30 MW output

150 ppm at 15 percent O2 or 1,100
ng/J of useful output (8.7 lb/MWh)

Turbines located north of the Arctic
Circle (latitude 66.5 degrees north),
turbines operating at less than 75
percent of peak load, modified and
reconstructed offshore turbines, and
turbines operating at temperatures less
than 0 °F

>30 MW output

96 ppm at 15 percent O2 or 590
ng/J of useful output (4.7 lb/MWh)

Heat recovery units operating
independent of the combustion turbine

All sizes

54 ppm at 15 percent O2 or 110
ng/J of useful output (0.86
lb/MWh)

Regarding SO2, the standards of performance in subpart KKKK reflect the use of low-
sulfur fuels. The fuel sulfur content limit is 26 ng/J (0.060 lb SCh/MMBtu) heat input for
combustion turbines located in continental areas and 180 ng/J (0.42 lb SCh/MMBtu) heat
input in noncontinental areas. This is approximately equivalent to 0.05 percent sulfur by
weight (500 parts per million by weight (ppmw)) for fuel oil in continental areas and 0.4
percent sulfur by weight (4,000 ppmw) for fuel oil in noncontinental areas, respectively.
Subpart KKKK also includes an optional output based SO2 standard.

In subpart GG in 1979, the EPA determined that it was appropriate to exempt
emergency combustion turbines from the NOx limits. These included emergency-standby
combustion turbines, military combustion turbines, and firefighting combustion turbines.
Emergency combustion turbines are further defined in subpart KKKK as units that operate
in emergency situations, such as turbines used to supply electric power when the local

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utility service is interrupted. Subpart KKKK also includes exemptions for stationary
combustion turbine test cells/stands and integrated gasification combined cycle (IGCC)
combustion turbine facilities covered by subpart Da of 40 CFR part 60 (the Utility Boiler
NSPS). Furthermore, under subpart KKKK, the HRSG and duct burners continue to be
exempt from subparts Da, Db, and Dc (the Utility Boiler and Industrial, Commercial, and
Institutional Boiler NSPS) while combustion turbines used by manufacturers in research
and development of equipment for both combustion turbine emissions control techniques
and combustion turbine efficiency improvements are exempt from the NOx limits on a case-
by-case basis only.

On September 5, 2006, a petition for reconsideration of the revised NSPS was filed
by the Utility Air Regulatory Group (UARG). The EPA granted reconsideration of subpart
KKKK and on August 29, 2012, proposed to amend subparts KKKK and GG to address
specific issues identified by the petitioners (77 FR 52554) as well as other technical and
editorial issues.

The 2012 proposed amendments to subparts KKKK and GG of 40 CFR part 60 were
in response to issues raised in the UARG petition for reconsideration discussed above.
Specifically, the EPA proposed to clarify the intent in applying and implementing specific
rule requirements, to correct unintentional technical omissions and editorial errors, and
address various other issues that were identified since promulgation of subpart KKKK. The
EPA has not taken further action on that proposed rule and, in this action, proposes to
withdraw the 2012 NSPS Proposal. However, several of the amendments in the 2012 NSPS
Proposal are being reproposed in this action where appropriate, and these changes are also
reflected in the new proposed NSPS.

1.5 Proposed Requirements

Sources subject to the proposed NSPS are stationary combustion turbines with a
heat input at peak load equal to or greater than 10.7 gigajoules per hour (GJ/h) (10 million
British thermal units per hour (MMBtu/h)), based on the higher heating value (HHV) of the
fuel, that commence construction, modification, or reconstruction after the publication of
this proposed rule in the Federal Register. The applicability of sources that would be

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subject to the proposed subpart KKKKa is similar to that for sources subject to the existing
40 CFR part 60, subpart KKKK. Stationary combustion turbines subject to the proposed
standards in the new subpart KKKKa would not be subject to the requirements of subparts
GG or KKKK; the HRSG and duct burners subject to these proposed standards would
continue to be exempt from the requirements of 40 CFR part 60, subpart Da (the Utility
Boiler NSPS) as well as subparts Db and Dc (the Industrial/Commercial/Institutional Boiler
NSPS) as previously established in subpart KKKK. The proposed subpart KKKKa maintains
the NOx exemptions promulgated previously in subparts GG and KKKK.

The EPA is proposing three size-based subcategories in subpart KKKKa, to align the
subcategories with those in subpart TTTTa (Standards of Performance for Greenhouse Gas
Emissions for Modified Coal-Fired Steam Electric Generating Units and New Construction
and Reconstruction Stationary Combustion Turbine Electric Generating Units). The
proposed subcategories include combustion turbines with base load ratings of less than or
equal to 250 MMBtu/h of heat input, those with base load ratings of greater than 250
MMBtu/h of heat input and less than or equal to 850 MMBtu/h, and those with base load
rating greater than 850 MMBtu/h. Like subpart KKKK, these subcategories are based on the
rating of the turbine engine and do not include any supplemental fuel input to the heat
recovery system and are consistent with combustion control technologies (and
manufacturer guarantees) currently available for different sized combustion turbines.

The EPA is proposing to subcategorize small, medium, and large combustion
turbines as low load, intermediate load, or base load units based on annual capacity factors.
Low load combustion turbines would have annual capacity factors less than or equal to 20
percent, intermediate load combustion turbines would have annual capacity factors greater
than 20 percent and less than or equal to 40 percent, and base load combustion turbines
would have annual capacity factors greater than 40 percent. For each of these proposed
subcategories, the EPA is proposing to subcategorize them further depending on whether
they are natural gas-fired or non-natural gas-fired stationary combustion turbines. In
addition, the EPA is proposing to create subcategories for combustion turbines operating at
part loads, combustion turbines located north of the Arctic Circle, or combustion turbines

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operating at ambient temperatures of less than 0 °F. Finally, the EPA is proposing to
subcategorize HRSG units operating independent of the combustion turbine.

The proposed NOx performance standard that corresponds to each proposed
subcategory reflects the application of the proposed BSER on sources that operate at low,
intermediate, or high loads and that burn natural gas, non-natural gas (such as distillate
fuels), hydrogen, or a combination of the three. As part of its review of the NSPS, the EPA
evaluated dry combustion controls (e.g., lean premix/diy low NOx (DLN) systems), wet
combustion controls (e.g., water or steam injection), and post-combustion selective
catalytic reduction (SCR) to determine BSER for each of the subcategories of combustion
turbines that burn natural gas. For small combustion turbines (i.e., those that have a peak
load heat input rating of less than or equal to 250 MMBtu/h) that operate at low and
intermediate loads, the EPA proposes that the use of combustion controls remains the
BSER and proposes that combustion controls with the addition of post-combustion SCR is
the BSER for small combustion turbines that operate at capacity factors greater than 40
percent (i.e., base load). For medium sized combustion turbines (i.e., those that have a peak
load heat input rating of greater than 250 MMBtu/h but less than or equal to 850
MMBtu/h), the EPA proposes that combustion controls remain the BSER for units that
operate at capacity factors less than or equal to 20 percent (i.e., low load) and proposes
that combustion controls with the addition of post-combustion SCR is the BSER for
medium-sized combustion turbines that operate at capacity factors greater than 20 percent
(i.e., intermediate or high load). For large combustion turbines (i.e., those that have a peak
load heat input rating of greater than 850 MMBtu/h), the EPA proposes that the use of
combustion controls is the BSER for units that operate at low loads (i.e., less than or equal
to 20 percent capacity factor). However, for large units that operate at intermediate or high
capacity factors (i.e., greater than 20 percent capacity factor), the EPA proposes that
combustion controls with the addition of post-combustion SCR is the BSER for sources in
those subcategories. These proposed standards are summarized in Table 2.

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Table 2 Proposed Subcategories and NOx Standards for Subpart KKKKa

Combustion turbine
type

Combustion
turbine fuel

BSER

NOx

emission
standard
(lb/MMBtu)

NOx

emission
rate

equivalent
fPPml

llnsc l.ond Knling iJ 2.>0 MMIilu/h







New and reconstructed

Natural gas

Dry combustion controls

0.092

25

low and intermediate









load combustion turbines

Non-natural gas

Wet combustion controls

0.290

74

New and reconstructed

Natural gas

Combustion controls with SCR

0.011

3

base load combustion









turbines

Non-natural gas

Combustion controls with SCR

0.035

9

Modified combustion

Natural gas

Dry combustion controls

0.092

25

turbines, all loads

Non-natural gas

Wet combustion controls

0.290

74

linsc l.ond Haling 2.>0 MMI!lu/'h and ii H.>()

MMIilu/h





New and reconstructed

Natural gas

Dry combustion controls

0.092

25

low load combustion









turbines

Non-natural gas

Wet combustion controls

0.290

74

New and reconstructed

Natural gas

Combustion controls with SCR

0.011

3

intermediate and base









load combustion turbines

Non-natural gas

Combustion controls with SCR

0.035

9

Modified combustion

Natural gas

Dry combustion controls

0.092

25

turbines, all loads

Non-natural gas

Wet combustion controls

0.290

74

linsc l.ond Killing H.>() MMI!lu/h







New, modified, and

Natural gas

Combustion controls with SCR

0.011

o

reconstructed









intermediate and base

Non-natural gas

Combustion controls with SCR

0.019

5

load combustion turbines









New, modified, and

Natural gas

Dry combustion controls

0.055

15

reconstructed low load









combustion turbines

Non-natural gas

Wet combustion controls

0.150

42

Oilier conihuslion lurhincs

Small combustion
turbines (with base load
rating < 250 MMBtu/h]
operating at part loads,
operating north of the
Arctic Circle, or at
ambient temperatures of
less than 0 °F, modified

Natural gas or Diffusion Flame combustion
non-natural gas controls

0.580

150

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Combustion turbine
type

Combustion
turbine fuel

BSER

NOx

emission
standard
(lb/MMBtu)

NOx

emission
rate

equivalent
fPPml

offshore combustion
turbines









Medium and large
combustion turbines
(with base load rating >
250 MMBtu/h) operating
at part loads, operating
north of the Arctic Circle,
or at ambient
temperatures of less than
0 °F, modified offshore
combustion turbines

Natural gas or
non-natural gas

Diffusion flame combustion
controls

0.370

96

Heat recovery units
operating independent of
the combustion turbine

Natural gas or
non-natural gas

Dry combustion controls

0.200

54

Several statutes and executive orders (EO) apply analytical requirements to federal
rulemakings. This Regulatory Impact Analysis (RIA) presents several of the analyses
required by these statutes and EOs, such as EO 12866, EO 14094, and the Regulatory
Flexibility Act (RFA). The guidance document associated with EO 12866 and EO 14094 is
the Office of Management and Budget's (OMB) Circular A-4 (U.S. OMB, 2023), which was
updated in November 2023.

This proposed action is significant under 3(f)(1) of Executive Order 12866 (as
amended by EO 14094), which specifies that a rule is significant if it is likely to result in an
annual effect on the economy of $200 million or more (adjusted every 3 years by the
Administrator of OMB's Office of Information and Regulatory Affairs (OIRA) for changes in
gross domestic product); or adversely affect in a material way the economy, a sector of the
economy, productivity, competition, jobs, the environment, public health or safety, or State,
local, territorial, or tribal governments or communities.1 In accordance with EO 12866 as

1 EO 14094 can be found at https://www.federalregister.gov/documents/2023/04/ll/2023-
07760/modernizing-regulatory-review.

11

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amended by EO 14094 and the guidelines of OMB Circular A-4, this RIA analyzes the costs
of complying with the requirements in this proposed rule for regulated facilities.

1.6 Organization of this RIA

The remainder of this report details the methodology and the results of the RIA.
Chapter 2 presents an overview of combustion turbine types and their installation costs, as
well as a brief description of the industries in which they are most prevalent. Chapter 3
describes the emissions and cost analysis prepared for this proposed rule. Chapter 4
presents the benefits analysis, which describes the health effects associated with exposure
to NOx and SO2 and reports the estimated monetized benefits associated with this proposed
rule. Chapter 5 describes the environmental justice analysis performed for this proposed
rule. Chapter 6 presents a discussion of potential economic impacts, impacts on small
businesses and a discussion of potential employment impacts. Chapter 7 presents a
comparison of the benefits and costs. Chapter 8 contains the references for this RIA.

12

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2 COMBUSTION TURBINE TECHNOLOGIES AND COSTS

2.1 Introduction

This section provides background information on combustion turbine technologies.
Included is a discussion of simple-cycle combustion turbines (SCCTs) and combined-cycle
combustion turbines (CCCTs), along with a comparison of fuel efficiency and capital costs
between the two classes of turbines.

2.2 Simple-Cycle Combustion Turbine Technologies

Most stationary combustion turbines use natural gas to generate shaft power that is
converted into electricity by a generator, or used to power a mechanical drive device such
as a gas compressor or pump.

Combustion turbines have four basic components, as shown in Figure 1.

1. The compressor raises the air pressure up to thirty times atmospheric pressure.

2. A fuel compressor is used to pressurize the fuel.

3. The compressed air is heated in the combustion chamber at which point fuel is
added and ignited.

4. The hot, high pressure gases are then expanded through a power turbine,
producing shaft power, which is used to drive the air and fluid compressors of
the combustion turbine as well as a generator or other mechanical drive device.
Approximately one-third of the power developed by the power turbine can be
required by the compressors.

Electric utilities primarily use simple-cycle combustion turbines as peaking or
backup units. Their relatively low capital costs and quick start-up capabilities make them
ideal for partial operation to generate power at periods of high demand or to provide
ancillary services. The disadvantage of simple-cycle systems is that they are relatively
inefficient, thus making them less attractive as base load generating units.

-------
Fuel-

Combustion
Chamber

Figure 1 Simple-Cycle Gas Turbine

2.3 Combined-Cycle Combustion Turbines Technologies

The combined-cycle system incorporates two simple-cycle systems into one
generation unit to maximize energy efficiency Energy is produced in the first cycle using a
gas turbine; then the heat that remains is used to create steam, which is run through a
steam turbine, which is the second cycle. Thus, two single units, gas and steam, are
combined to minimize lost potential energy. In a CCCT, the waste heat remaining from the
gas turbine cycle is used in a boiler to produce steam. The steam is then put through a
steam turbine, producing power. The remaining steam is recondensed and either returned
to the boiler where it is sent through the process again or sold to a nearby industrial site to
be used in a production process. Figure 2 shows a gas-fired CCCT.

There are significant efficiency gains in using a combined-cycle turbine compared to
simple-cycle systems. With SCCTs, adding a second stage allows for heat that otherwise
would have been emitted and completely wasted to be used to create additional power or
steam for industrial purposes. While SCCTs typically range from 30-40 percent efficiency,
CCCTs typically range from 50-60 percent efficiency (Gas Turbine World, 2023). In addition
to energy efficiency gains, CCCTs also offer environmental efficiency gains compared to
existing coal plants. In addition, efficiency gains associated with the CCCT lead to lower
emissions compared to SCCTs.

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Figure 2 Combined-Cycle Gas Turbine

2.4 Capital and Installation Costs

Table 3 presents capital cost estimates for several types of utility-scale gas turbine
power plants. These estimates are discussed in more detail in Gas Turbine World (2023)
and are based on estimates in U.S. EIA (2020). Because these estimates are for power
plants, they include the cost of generators, natural gas pipelines, and electrical grid
hookups that are not applicable for all combustion turbine uses. However, these estimates
provide some insight as to the overall cost of combustion turbines.

The first industrial gas turbine began operation in 1939, and the technology has
undergone constant improvement since then. Table 3 shows the capital cost for three types
of turbines, under the broader categories of simple cycle and combined cycle turbines
discussed previously: Aeroderivative, F-Class, and H-Class. Aeroderivative turbines are
lightweight and compact designs adapted from aircraft jet engines. The F-Class turbine was
developed during the 1980s and began to be used in commercial operations in the early
1990s (Eldrid et al., 2001). The H-Class turbine is a more efficient design with a higher

15

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pressure ratio and higher firing temperature that was introduced in 1995 (Matta et al.,
2000).

Table 3 Utility-scale Gas Turbine Power Plant Capital Cost Estimates (million
2022$ unless otherwise noted)

Simple Cycle

Combined Cycle

100 MW

240 MW

430 MW

1100 MW

Aeroderivative

F-Class

H-Class

lln^inoorin^, Procurement, and Construction Costs (lil'C)

Civil / Structural / Architectural

7.7

15.0

38.1

73.6

Mechanical - Major Equipment

52.8

65.7

159.7

360.8

Mechanical - Balance of Plant

12.0

20.9

89.7

240.5

Electrical

18.7

24.6

34.4

114.1

Project Indirect Costs

18.3

23.0

98.2

184.1

EPC Contracting Fee

10.9

14.9

42.0

97.3

Owner's Costs

Owner's Services

8.4

11.5

32.4

74.9

Land Acquisition

0.7

2.1

Electrical Interconnection

1.5

2.2

3.0

Gas Pipeline Interconnection

5.5

7.2

Project Contingency

13.6

18.3

50.6

115.8

Total Plant Cost

150.1

201.6

556.4

1,273.3

Net Plant Rating [1
-------
Project indirect costs include plant engineering, construction management, and start-up
and commissioning, as well as contractor fees, overhead, and profit. Owner's costs include
project development, land acquisition, and utility interconnections. A project contingency is
included to account for cost uncertainties (Gas Turbine World, 2023; U.S. EIA, 2020).

2.5 Affected Producers

As discussed in Section 1.5, the sources subject to the proposed NSPS are stationary
combustion turbines with a heat input at peak load equal to or greater than 10.7 GJ/h (10
MMBtu/h), based on the higher heating value (HHV) of the fuel, that commence
construction, modification, or reconstruction after the publication of this proposed rule in
the Federal Register. This rule applied to any industry using a new stationary combustion
turbine as defined in Section 1.4.

To understand the industries likely to be impacted by this rule, current turbines in
the National Emission Inventory (NEI) were identified. While the design capacity is not
always reported in the National Emission Inventory (NEI), the units identified as
combustion turbines in the 2020 NEI and having a valid design capacity of greater than 10
MMBtu/h or equivalent are summarized in Table 4 by North American Industry
Classification System (NAICS) code.

Table 4 Combustion Turbines over 10 MMBtu/h or equivalent by NAICS code
NAICS Description # of Units # of Facilities

2111

Oil and Gas Extraction

433

132

2211

Electric Power Generation, Transmission and Distribution

2711

968

2212

Natural Gas Distribution

100

2213

Water, Sewage and Other Systems

3112

Grain and Oilseed Milling

3221

Pulp, Paper, and Paperboard Mills

3241

Petroleum and Coal Products Manufacturing

3251

Basic Chemical Manufacturing

3252

Resin, Synthetic Rubber, and Artificial and Synthetic Fibers and

Filaments Manufacturing

3253

Pesticide, Fertilizer, and Other Agricultural Chemical Manufacturing

3254

Pharmaceutical and Medicine Manufacturing

3259

Other Chemical Product and Preparation Manufacturing

4861

Pipeline Transportation of Crude Oil

4862

Pipeline Transportation of Natural Gas

650

329

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NAICS

Description

# of Units

# of Facilities

4869

Other Pipeline Transportation

4881

Support Activities for Air Transportation

5171

Wired and Wireless Telecommunications (except Satellite)

5182

Computing Infrastructure Providers, Data Processing, Web Hosting,
and Related Services

5241

Insurance Carriers

5311

Lessors of Real Estate

5622

Waste Treatment and Disposal

6113

Colleges, Universities, and Professional Schools

6221

General Medical and Surgical Hospitals

9241

Administration of Environmental Quality Programs

9281

National Security and International Affairs

Other industries with fewer than 5 turbines per industry

Total

4365

1715

Five of these NAICS codes account for over 90 percent of the turbines in the 2020
NEI. They are 2111 (Oil and Gas Extraction), 2211 (Electric Power Generation,
Transmission and Distribution), 2212 (Natural Gas Distribution), 3251 (Basic Chemical
Manufacturing), and 4862 (Pipeline Transportation of Natural Gas). The NAICS codes serve
as a guide for readers outlining the entities that this proposed action is likely to affect. The
proposed standards, once promulgated, will be directly applicable to affected facilities that
begin construction, reconstruction, or modification after the date of publication of the
proposed standards in the Federal Register.

NAICS 2111 comprises establishments that operate and/or develop oil and gas field
properties. Operation and development activities include exploration for crude petroleum
and natural gas; drilling, completing, and equipping wells; operating separators, emulsion
breakers, desilting equipment, and field gathering lines for crude petroleum and natural
gas; and all other activities in the preparation of oil and gas up to the point of shipment
from the producing property. This subsector includes the production of crude petroleum,
the mining and extraction of oil from oil shale and oil sands, the production of natural gas,
sulfur recovery from natural gas, and recovery of hydrocarbon liquids. Establishments in
this subsector include those that operate oil and gas wells on their own account or for
others on a contract or fee basis. NAICS 2211 comprises establishments primarily engaged
in generating, transmitting, and/or distributing electric power. Establishments in this

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industry group may perform one or more of the following activities: (1) operate generation
facilities that produce electric energy; (2) operate transmission systems that convey the
electricity from the generation facility to the distribution system; and (3) operate
distribution systems that convey electric power received from the generation facility or the
transmission system to the final consumer. NAICS 2212 comprises: (1) establishments
primarily engaged in operating gas distribution systems (e.g., mains, meters); (2)
establishments known as gas marketers that buy gas from the well and sell it to a
distribution system; (3) establishments known as gas brokers or agents that arrange the
sale of gas over gas distribution systems operated by others; and (4) establishments
primarily engaged in transmitting and distributing gas to final consumers. NAICS 3251
comprises establishments primarily engaged in manufacturing chemicals using basic
processes, such as thermal cracking and distillation. Chemicals manufactured in this
industry group are usually separate chemical elements or separate chemically-defined
compounds. NAICS 4862 comprises establishments primarily engaged in the pipeline
transportation of natural gas from processing plants to local distribution systems. This
industry includes the storage of natural gas because the storage is usually done by the
pipeline establishment and because a pipeline is inherently a network in which all the
nodes are interdependent.

The total number of firms and establishments in these five NAICS, as well as their
employment and annual payroll are summarized in Table 5 below. The information in
Table 5 is not meant to serve as an exhaustive presentation for each affected industry but is
instead meant to serve as a high-level summary of potentially relevant information for
these industries.

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Table 5 Number of Firms and Establishments, Employment, and Annual Payroll for
Affected Industries: 2021

NAICS

NAICS Description

Firms Establishments Employment

Annual
Payroll
($1,000)

2111

Oil and Gas Extraction

4,337

5,444

88,532

13,164,547

2211

Electric Power Generation, Transmission and

2,227

12,481

497,375

61,888,671

Distribution

2212

Natural Gas Distribution

429

2,441

89,775

9,682,205

3251

Basic Chemical Manufacturing

1,245

2,438

154,491

15,922,408

4862

Pipeline Transportation of Natural Gas

117

2,068

26,263

3,274,407

Source: U.S. Census Bureau, 2021 Statistics of U.S. Businesses.
2.6 Projected Growth of Combustion Turbines

Because the date of construction is not available in the NEI and is often not reported
to the EPA Emissions Inventory System (EIS), a separate turbine dataset was created to
assess the number of new turbines constructed within the past five years. This dataset was
created using Form EIA-860 survey data from the Energy Information Administration, the
EPA's Clean Air Markets Program Data (CAMPD), the EPA's National Electric Energy Data
System (NEEDS) database, and existing major sources subject to the National Emission
Standards for Hazardous Air Pollutants (NESHAP) for stationary combustion turbines. A
permit review was also conducted to confirm the construction date and installed emissions
controls for these units. Form EIA-860 collects unit-level information about existing and
planned units and associated environmental equipment at electric power plants with 1
megawatt or greater of combined nameplate capacity. Combustion turbines that are
connected to a generator larger than 250 MMBtu/hMW generally report emissions and
control technology information to the EPA. The EPA reviewed the reported NOx control
technology from the CAMPD for combustion turbines that commenced operation between
2019 and 2023. NEEDS is an EPA database of electric generators that serves as a resource
for modeling the sector. NEEDS includes source information about existing and planned
units, information about the combustion turbines themselves, and data about their air
emissions. The list of sources compiled for the EPA's review of the NESHAP only includes
combustion turbines that are major sources of toxic air emissions, including industrial
sources that do not appear in NEEDS, CAMPD, or the Form EIA-860 survey data. This
dataset was supplemented with an estimate of the number of new stationary combustion

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turbines at non-major sources, for which we have limited information. The development of
this dataset is discussed in greater detail in the Technical Support Document titled NOx
Control Technology Baseline, available in the docket for this proposed rule.

Based on this combined dataset, 235 combustion turbines that would have been
subject to this rule if constructed after this NSPS proposal were constructed within the past
5 years. The types of these units and their installed controls are summarized in Table 6.

Table 6 Types of Combustion Turbines Constructed 2019-2023 and Installed
Controls

Total

Number of

Total

Number of

Simple Cycle

Number of

Combined

Turbine Type

Simple Cycle

Turbines

Combined

Cycle

Turbines

with SCR

Cycle

Turbines

with SCR

<250 MMBtu/h

> 250 MMBtu/h and < 850 MMBtu/h

> 850 MMBtu/h

Direct Mechanical Drive

Total

176

The EPA has used this combined dataset to estimate the potential number of new
combustion turbines that would be affected by this proposed rule and the additional NOx
controls they may be required to adopt. However, this combined dataset is a selected
sample, which may not be representative of the entire population of combustion turbines
in the future. In particular, it has greater representation of larger combustion turbines and
those in the electricity sector relative to the general population of combustion turbines.
Nonetheless because these data sets provide the best information regarding turbines to
date, the following analysis assumes that the units in this dataset are representative of the
population of combustion turbines that the EPA has limited installation and pollution
control information on - in particular smaller combustion turbines and those used in
industrial sectors - as sectors that employ turbines evolve in the future. These data
limitations and assumptions are potentially a notable source of uncertainty in the following
analysis of the benefits, costs, and other impacts of this proposed rule. The EPA is pursuing
identifying better information on the NOx controls, size, and number of smaller combustion
turbines and those in use at industrial sources and we solicit comment on data and
information that would aid in refining these current estimates.

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3 ENGINEERING COST ANALYSIS

3.1 Introduction

This chapter provides a summary of the cost analysis conducted for this rulemaking.
Section 3.2 describes the affected sources. Section 3.3 briefly describes the methodology
employed in the cost analysis and presents the results of that analysis. Section 3.4 discusses
the secondary impacts of the proposed rule, and Section 3.5 characterizes the uncertainty
in the cost estimates.

3.2 Affected Sources

As discussed in Section 1.5, sources subject to the proposed NSPS are stationary
combustion turbines with a heat input at peak load equal to or greater than 10.7 GJ/h (10
MMBtu/h), based on the higher heating value (HHV) of the fuel, that commence
construction, modification, or reconstruction after the publication of this proposed rule in
the Federal Register. To estimate the projected number of affected combustion turbines in
each year, the dataset described in Section 2.6 was used. Based on this datasetand
assuming the same distribution of units in future years, the number of new, modified, or
reconstructed stationary combustion turbines in each subcategory that are expected in
each year is presented in Table 7. These values were calculated by rounding the per year
estimates of new units over the 2019-2023, which were reported in Table 6.

Table 7 Estimated Number of New, Modifed, or Reconstructed Turbines in Each
Year

Subcategory

New Units per Year

Average New Units per Year
Expected to Incur Increased
Costs Relative to Baseline

<250 MMBtu/h

> 250 MMBtu/h and < 850 MMBtu/h

> 850 MMBtu/h

Direct Mechanical Drive

Total

For these affected combustion turbines, the NSPS BSER discussed in Section 1.5 is
the use of combustion controls with the addition of post-combustion SCR. The SCR process
is based on the chemical reduction of the NOx molecule via a nitrogen-based reducing agent

-------
(reagent) and a solid catalyst. To remove NOx, the reagent, commonly ammonia (NH3,
anhydrous and aqueous) or urea-derived ammonia, is injected into the post-combustion
flue gas of the combustion turbine. The reagent reacts selectively with the flue gas NOx
within a specific temperature range and in the presence of the catalyst and oxygen to
reduce the NOx into molecular nitrogen (N2) and water vapor (H2O). SCR employs a
ceramic honeycomb or metal-based surface with activated catalytic sites to increase the
rate of the reduction reaction. Over time, however, the catalyst activity decreases, requiring
replacement, washing/cleaning, rejuvenation, or regeneration to extend the life of the
catalyst. Catalyst designs and formulations are generally proprietary. The primary
components of the SCR include the ammonia storage and delivery system, ammonia
injection grid, and the catalyst reactor.

3.3 Capital Investment, Annual Costs, and Emissions Reductions

To comply with the requirements of this proposed rule, some units will incur capital
costs associated with installation of SCR or upgrades to existing controls, while some units
are expected to incur increased operating costs of their existing controls to meet the
proposed requirements. These capital and increased operating costs were estimated based
on model plants from NETL (2023). The development of these cost estimates is discussed
in detail in the Technical Support Document titled NOx Mitigation Measures - Selective
Catalytic Reduction for Combustion Turbines, available in the docket for this proposed rule.

For this proposed rule, we selected an 8-year analysis period to align with the NSPS
review timing in CAA Section 111(B)(1)(b) and estimated compliance will begin in 2028,
reflecting the time required to complete the construction of a new, modified, or
reconstructed turbine. The costs and emission reductions also reflect a reduced capacity
factor from 2032 on in response to the requirements of the NSPS for Greenhouse Gas
Emissions from New, Modified, and Reconstructed Fossil Fuel-Fired Electric Generating
Units (89 FR 39798; May 9, 2024). Our economic analysis for that rule projected that new
natural gas combined cycle (NGCC) turbines that do not install carbon capture and
sequestration/storage (CCS) drop their capacity factor to 40 percent while the small

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number that do install CCS operate at an annual capacity factor of 87 percent.2 This results
in an average capacity factor for all new NGCC units of 42 percent. The results are
summarized in Table 8.

Table 8 Summary of Estimated Undiscounted Costs and Emission Reductions in
First 8 Years After the Rule is Final

Year

Cumulative
New Units
Subject to
NSPS

Cumulative
Units with
Increased
Operating
Costs Relative
to Baseline

Unannualized
Capital Cost
(million 2023$)

Total Cost
(Annualized
Capital Cost and
Operating Cost)
(million 2023$)

Annual NOx
Emission
Reductions
Relative to
Baseline (tons)

2025

2026

2027

$48.6

$8.01

198

2028

$52.5

$17.3

714

2029

110

$52.5

$26.7

1,229

2030

157

$52.5

$36.0

1,744

2031

204

109

$52.5

$45.3

2,259

2032

251

132

$52,.5

$54.4

2,659

Note: Costs rounded to three significant figures. The annualized capital cost that is included in the total cost
is annualized over the assumed 20-year lifetime of the equipment. For more information about the
per unit cost of SCR, please refer to the Technical Support Document titled NOx Mitigation Measures -
Selective Catalytic Reduction for Combustion Turbines, available in the docket for this proposed rule.

Table 9 reports the 2024 present value and equivalent annualized value of the costs
shown in Table 8 at a 2 percent discount rate. We solicit comment, data and information
that would allow refinement of these estimates.

Table 9 2024 Present Value and Equivalent Annualized Value (million 2023$)

2% Discount Rate

Present Value

$166

Equivalent Annualized Value

$22.6

Note: Values rounded to nearest thousand.

2 The Integrated Planning Model [IPM] used by the EPA to analyze the projected impact of environmental
policies on the electric power sector does not track the number of units, instead building model plants. In
the modeling used for the RIA for the NSPS for Greenhouse Gas Emissions from New, Modified, and
Reconstructed Fossil Fuel-Fired Electric Generating Units (89 FR 39798; May 9, 2024), the EPA projected
that 870 MW of new NGCC builds installed CCS.

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3.4 Secondary Impacts

SCR uses ammonia as a reactant and some ammonia is emitting either by passing
through the catalyst bed without reacting with NOx (unreacted ammonia) or passing
around the catalyst bed through leaks in the seals around the catalysts bed. Both of these
combined are referred to ammonia slip. Ammonia is a precursor to fine particulate matter.
Ammonia slip increases as catalysts beds age and is often limited to 10 ppm or less in
operating permits. Ammonia catalysts are available to reduce emissions of ammonia. The
ammonia catalyst consists of an additional catalysts bed after the SCR catalyst that reacts
with the ammonia that passes through and around the catalyst to reduce overall ammonia
slip. In the NETL (2023) model plants used in the EPA's analysis, no additional ammonia
catalyst was included and ammonia emissions were limited to 10 ppm and the end of the
catalysts' life. For estimating secondary impacts, the EPA assumed average ammonia
emissions of 3.5 ppm based on information from the EPA Air Pollution Control Cost Manual
(U.S. EPA, 2017a).3 The EPA estimates that for each ton of NOx controlled 0.10 tons of
ammonia are emitted.

SCR also reduces the efficiency of a combustion through the auxiliary/parasitic load
requirements to run the SCR and the backpressure created from the catalyst bed. The EPA
used the auxiliary load required by the SCR that was directly provided in the NETL (2023)
report, and estimated the loss in output from operation of the SCR due to backpressure as
0.3% of the gross output. The overall result is a reduction in efficiency of 0.30%, resulting
in 7.5 additional tons of CO2 emissions per ton of NOx controlled.

Table 10 summarizes the estimated increases in ammonia and CO2 emissions.

3 The EPA Control Cost Manual (U.S. EPA, 2017a) notes that ammonia slip refers to the excess reagent
passing through the reactor. Ammonia in the flue gas causes a number of problems, including health
effects, visibility of the stack effluent, salability of the fly ash, and the formation of ammonium sulfates.
Limits on acceptable ammonia slip, imposed by either regulatory limits or by design requirements, place
constraints on SCR performance. Ammonia slip does not remain constant as the SCR system operates but
increases as the catalyst activity decreases. Properly designed SCR systems, which operate close to the
theoretical stoichiometry and supply adequate catalyst volume, maintain low ammonia slip levels,
approximately 2 to 5 ppm. The 3.5 ppm value used in this analysis reflects the midpoint of this range.

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Table 10 Estimated Increased Ammonia and CO2 Emissions Associated with NOx
Emission Reductions

Year

Ammonia

CO2

(tons)

(metric tons!

2025

2026

2027

1,449

2028

4,464

2029

108

7,479

2030

152

10,494

2031

196

13,509

2032

232

16,039

3.5 Characterization of Uncertainty

It is important to note that the cost estimates presented in this chapter are subject
to multiple sources of uncertainty. The proposed rule does not dictate that controls must
be installed to control pollutants, but rather that new, modified, and reconstructed turbines
must meet emission standards consistent with the BSER for that unit. If the owners of
affected units are able to find alternative methods to comply, then the costs presented in
this RIA may be overestimates. Likewise, the costs may be underestimated if the variable
cost associated with running existing controls more was underestimated in the cost
analysis or if the controls the EPA assumed will be needed are not able to obtain the
required reductions.

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4 BENEFITS OF EMISSIONS REDUCTIONS

4.1 Introduction

Combustion turbines are a source of NOx and SO2 emissions. The health effects of
exposure to these pollutants are briefly discussed in this section. Because the proposed
NSPS is expected to result in reductions of NOx emissions, the EPA estimated the monetized
benefits related to avoided premature mortality and morbidity associated with reduced
exposure to NOx as a precursor to ozone and PM2.5. These results are summarized below.
Section 3.4 discusses the secondary impacts of this proposed rule, and the projected
increases in emissions of ammonia and CO2 are also monetized below.

The PV of the benefits of the proposed rulemaking for NOx reductions are estimated
at $200 million and $670 million at a 2% discount rate. The EAV of the benefits of this
proposed rulemaking for NOx reductions are estimated at $27 million and $92 million at a
2 percent discount rate. Alternative calculations of the PV of monetized benefits for this
proposed rule are estimated at $150 million and $750 million at a 2 percent discount rate
and alternative calculations of the EAV of the benefits are estimated at $21 million and
$100 million at a 2 percent discount rate. All estimates are reported in 2023 dollars and are
calculated over the 2025-2032 analytical timeframe described earlier in this RIA.

4.2 Approach to Estimating PIVh.s-related Human Health Benefits

This section summarizes the EPA's approach to estimating the incidence and
economic value of the PIVh.s-related benefits estimated for this rule.

We estimate the quantity and economic value of air pollution-related effects by
estimating counts of air pollution-attributable cases of adverse health outcomes, assigning
dollar values to these counts, and assuming that each outcome is independent of one
another. We construct these estimates by adapting primary research—specifically, air
pollution epidemiology studies and economic value studies—from similar contexts. This
approach is sometimes referred to as "benefits transfer." Below we describe the procedure
we follow for: (1) selecting air pollution health endpoints to quantify; (2) calculating counts
of air pollution effects using a health impact function; (3) specifying the health impact

-------
function with concentration-response parameters drawn from the epidemiological
literature.

4.2.1 Selecting Air Pollution Health Endpoints to Quantify

As a first step in quantifying PIVh.s-related human health impacts, the EPA consults
the Integrated Science Assessment for Particulate Matter (PM ISA) (U.S. EPA, 2019) as
summarized in the TSD for the 2022 PM NAAQS Reconsideration Proposal RIA: Estimating
PM2.5- and Ozone-Attributable Health Benefits (U.S. EPA, 2023c) and reviewed by the EPA
Science Advisory Board in Review ofBenMAP and Benefits Methods (U.S. EPA-SAB, 2024).
This document synthesizes the toxicological, clinical, and epidemiological evidence to
determine whether each pollutant is causally related to an array of adverse human health
outcomes associated with either acute [i.e., hours or days-long) or chronic [i.e., years-long)
exposure. For each outcome, the ISA reports this relationship to be causal, likely to be
causal, suggestive of a causal relationship, inadequate to infer a causal relationship, or not
likely to be a causal relationship.

The ISA for PM2.5 found acute exposure to PM2.5 to be causally related to
cardiovascular effects and mortality [i.e., premature death), and respiratory effects as
likely-to-be-causally related. The ISA identified cardiovascular effects and total mortality as
being causally related to long-term exposure to PM2.5 and respiratory effects as likely-to-
be-causal; and the evidence was suggestive of a causal relationship for reproductive and
developmental effects as well as cancer, mutagenicity, and genotoxicity.

The EPA estimates the incidence of air pollution effects for those health endpoints
listed above where the ISA classified the impact as either causal or likely-to-be-causal.

Table 11 reports the effects we quantified and those we did not quantify in this RIA. The list
of benefit categories not quantified shown in that table is not exhaustive. Among the effects
we quantified, we might not have been able to completely quantify either all human health
impacts or economic values. The table below omits health effects associated with changes
in ambient concentrations of SO2 and NO2, and any welfare effects such as acidification and
nutrient enrichment. These effects are described in the TSD, which details the approach
EPA followed for selecting and quantifying PM-attributable effects (U.S. EPA, 2023c).

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In February of 2024, EPA published the RIA for the final Particulate Matter National
Ambient Air Quality Standards (U.S. EPA, 2024a). EPA quantified the PM-related benefits of
this rule after publication of the final PM NAAQS RIA. The PM-related benefits reported in
this RIA reflect methods consistent with the TSD (U.S. EPA, 2023c), and these PM-related
benefits are estimated using methods consistent with the final PM NAAQS RIA. Specifically,
we quantify PM-attributable deaths using concentration-response parameters from the
Pope et al. (2019) and Wu et al. (2020) long-term exposure studies of the Medicare and
National Health Interview Survey cohorts, respectively.

Table 11 Human Health Effects of PM2.5 and whether they were Quantified and/or
Monetized in this RIA

Category

Effect

Effect
Quantified

Effect
Monetized

More
Information

Mortality from

Premature respiratory mortality from
short-term exposure (0-99)

Ozone ISA1

exposure to ozone

Premature respiratory mortality from
long-term exposure (age 30-99)

Ozone ISA

Hospital admissions—respiratory (ages
65-99)

Ozone ISA

Emergency department visits—
respiratory (ages 0-99)

Ozone ISA

Asthma onset (0-17)

Ozone ISA

Asthma symptoms/exacerbation
(asthmatics age 5-17)

Ozone ISA

Nonfatal morbidity
from exposure to

Allergic rhinitis (hay fever) symptoms
(ages 3-17)

Ozone ISA

Minor restricted-activity days (age 18-
65)

Ozone ISA

ozone

School absence days (age 5-17)

Ozone ISA

Decreased outdoor worker productivity
(age 18-65)

—

Ozone ISA2

Metabolic effects (e.g., diabetes)

—

Ozone ISA2

Other respiratory effects (e.g.,
premature aging of lungs)

—

Ozone ISA2

Cardiovascular and nervous system
effects

—

Ozone ISA2

Reproductive and developmental effects

—

Ozone ISA2

1 We assess these benefits qualitatively due to data and resource limitations for this analysis. In other analyses we

quantified these effects as a sensitivity analysis.

2 We assess these benefits qualitatively because we do not have sufficient confidence in available data or methods.

4.2.6 Quantifying Cases of Ozone-Attributable Premature Mortality

Mortality risk reductions account for the majority of monetized ozone-related
benefits. For this reason, this subsection and the following provide a brief background of
the scientific assessments that underly the quantification of these mortality risks and
identifies the risk studies used to quantify them in this RIA for ozone. As noted above, the
Estimating PM2.5- and Ozone-Attributable Health Benefits TSD describes fully the Agency's
approach for quantifying the number and value of ozone air pollution-related impacts,
including additional discussion of how the Agency selected the risk studies used to quantify
them in this RIA. The TSD also includes additional discussion of the assessments that
support quantification of these mortality risk than provide here.

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In 2008, the National Academies of Science (NRC, 2008) issued a series of
recommendations to EPA regarding the procedure for quantifying and valuing ozone-
related mortality due to short-term exposures. Chief among these was that "...short-term
exposure to ambient ozone is likely to contribute to premature deaths" and the committee
recommended that "ozone-related mortality be included in future estimates of the health
benefits of reducing ozone exposures..." The NAS also recommended that "...the greatest
emphasis be placed on the multicity and [National Mortality and Morbidity Air Pollution
Studies (NMMAPS)] ...studies without exclusion of the meta-analyses" (NRC, 2008). Prior to
the 2015 Ozone NAAQS RIA, the Agency estimated ozone-attributable premature deaths
using an NMMAPS-based analysis of total mortality (Bell et al., 2004), two multi-city
studies of cardiopulmonary and total mortality (Huang et al., 2005; Schwartz, 2005) and
effect estimates from three meta-analyses of non-accidental mortality (Bell et al., 2005; Ito
et al., 2005; Levy et al., 2005). Beginning with the 2015 Ozone NAAQS RIA, the Agency
began quantifying ozone-attributable premature deaths using two newer multi-city studies
of non-accidental mortality (Smith et al., 2009; Zanobetti and Schwartz, 2008) and one
long-term cohort study of respiratory mortality (Jerrett et al., 2009). The 2020 Ozone ISA
included changes to the causality relationship determinations between short-term
exposures and total mortality, as well as including more recent epidemiologic analyses of
long-term exposure effects on respiratory mortality (U.S. EPA, 2020a). In this RIA, as
described in the corresponding TSD, two estimates of ozone-attributable respiratory
deaths from short-term exposures are estimated using the risk estimate parameters from
Zanobetti etal. (2008) and Katsouyanni etal. (2009). Ozone-attributable respiratory
deaths from long-term exposures are estimated using Turner et al. (2016). Due to time and
resource limitations, we were unable to reflect the warm season defined by Zanobetti et al.
(2008) as June-August. Instead, we apply this risk estimate to our standard warm season of
May-September.

The 2020 Ozone ISA provides a thorough discussion of the uncertainty in the effects
of short- and long-term ozone exposure. One notable source of uncertainty is "the lack of
examination of potential copollutant confounding." Another is the possibility of exposure
measurement error. Despite these sources of uncertainty, the 2020 Ozone ISA finds that

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"there is coherence from animal toxicological studies that provides support for the
observed epidemiologic associations".

4.3 Economic Valuation

After quantifying the change in adverse health impacts, we estimate the economic
value of these avoided impacts. Reductions in ambient concentrations of air pollution
generally lower the risk of future adverse health effects by a small amount for a large
population. Therefore, the appropriate economic measure is willingness to pay (WTP) for
changes in risk of a health effect. For some health effects, such as hospital admissions, WTP
estimates are generally not available, so we use the cost of treating or mitigating the effect.
These cost-of-illness (COI) estimates generally (although not necessarily in every case)
understate the true value of reductions in risk of a health effect. They tend to reflect the
direct expenditures related to treatment but not the value of avoided pain and suffering
from the health effect. The unit values applied in this analysis are provided in the TSD for
the 2022 PM NAAQS Reconsideration Final Rule RIA: Estimating PM2.5- and Ozone-
Attributable Health Benefits (U.S. EPA, 2023c).

Avoided premature deaths account for 95 percent of monetized ozone-related
benefits and 98 percent of monetized PM-related benefits. The economics literature
concerning the appropriate method for valuing reductions in premature mortality risk is
still developing. The value for the projected reduction in the risk of premature mortality is
the subject of continuing discussion within the economics and public policy analysis
community. Following the advice of the Scientific Advisory Board's (SAB) Environmental
Economics Advisory Committee (SAB-EEAC), the EPA currently uses the value of statistical
life (VSL) approach in calculating estimates of mortality benefits, because we believe this
calculation provides the most reasonable single estimate of an individual's WTP for
reductions in mortality risk (U.S. EPA-SAB, 2000). The VSL approach is a summary
measure for the value of small changes in mortality risk experienced by a large number of
people.

The EPA continues work to update its guidance on valuing mortality risk reductions
and consulted several times with the SAB-EEAC on the issue. Until updated guidance is

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available, the EPA determined that a single, peer-reviewed estimate applied consistently
best reflects the SAB-EEAC advice it has received. Therefore, the EPA applies the VSL that
was vetted and endorsed by the SAB in the Guidelines for Preparing Economic Analyses
while the EPA continues its efforts to update its guidance on this issue (U.S. EPA, 2016b).
This approach calculates a mean value across VSL estimates derived from 26 labor market
and contingent valuation studies published between 1974 and 1991. The mean VSL across
these studies is $12.8 million (2022$).4

The EPA is committed to using scientifically sound, appropriately reviewed evidence
in valuing changes in the risk of premature death and continues to engage with the SAB to
identify scientifically sound approaches to update its mortality risk valuation estimates.
Most recently, the Agency finalized new meta-analytic approaches for updating its
estimates which were subsequently reviewed by the SAB-EEAC. The EPA is taking the
SAB's formal recommendations under advisement (U.S. EPA, 2017).

Because short-term ozone-related premature mortality occurs within the analysis
year, the estimated ozone-related benefits are identical for all discount rates. When valuing
changes in ozone-attributable deaths using the Turner et al. (2016) study, we follow advice
provided by the Health Effects Subcommittee of the SAB, which found that "...there is no
evidence in the literature to support a different cessation lag between ozone and
particulate matter. The HES therefore recommends using the same cessation lag structure

4 The WTP to avoid health impacts is adjusted for income growth over time. The central estimate of elasticity
ofWTP with respect to income growth is 0.15 for minor health endpoints, 0.45 for severe and chronic
effects, and 0.40 for mortality. Past income growth estimates are taken from the U.S. Bureau of Commerce's
Bureau of Economic Analysis [BEA], GDP values were adjusted for inflation using the BEA's price index for
GDP. We divided historical GDP values by populations provided by the BEA to estimate GDP per capita to
maintain internal consistency in the calculation. Future changes in annual income are based on data
presented in the Annual Energy Outlook (AEO] 2020, a report prepared by the U.S. Energy Information
Administration (EIA) (AEO, 2020). AEO published annual GDP projections through the year 2050, which
were adjusted for inflation using the GDP Chain-type Price Index reported by AEO. We divided projected
GDP values by AEO's population projections to estimate per capita GDP, again maintaining internal
consistency in the calculation.

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and assumptions as for particulate matter when utilizing cohort mortality evidence for
ozone" (U.S. EPA-SAB, 2010). 5

These estimated health benefits do not account for the influence of future changes in
the climate on ambient concentrations of pollutants (USGCRP, 2016). For example, recent
research suggests that future changes to climate may create conditions more conducive to
forming ozone. The estimated health benefits also do not consider the potential for climate-
induced changes in temperature to modify the relationship between ozone and the risk of
premature mortality (Jhun et al., 2014; Ren et al., 2008a, 2008b).

4.3.1 Benefit-per-Ton Estimates

Due to time constraints, the EPA did not conduct air quality modeling for this rule.
Instead, we used a "benefit-per-ton" (BPT) approach to estimate the benefits of this
rulemaking. The EPA has previously utilized BPT approaches to estimate health benefits for
other rulemakings, and has consulted with its Scientific Advisory Board about the design
and application of such approaches as well as alternative reduced form approaches (U.S.
EPA-SAB, 2020). A fuller description of these approaches and their development is
presented in Appendix A. In 2023, the EPA updated BPTs for 21 emissions sectors using an
updated 2017 emissions inventory (U.S. EPA, 2023). Sectoral BPTs were calculated for 3
regions (West, North, South) for 18 of the 21 sectors and at the State-level for the other 3
sectors (industrial boilers, stationary internal combustion engines, and electricity
generating units (EGUs)6). These BPT estimates provide the total monetized human health
benefits (the sum of premature mortality and premature morbidity) of reducing one ton of
the PM2.5, NOx and SO2 precursor for PM2.5 and the NOx precursor for ozone from a
specified source. It is important to note that Combustion Turbines were not among the

5 The lag structure is to assume that 30% of the deaths occur in year 0, 50% occur in years 1-5, and the
remainder occur in years 6-20. This is discussed in the Benefits TSD.

6 EGU emissions, unlike other sectors, were based on 2026 projected emissions from the 2016v3 platform as
described in the Regulatory Impact Analysis for the Proposed National Emission Standards for Hazardous
Air Pollutants: Coal- and Oil-Fired Electric Utility Steam Generating Units Review of the Residual Risk and
Technology Review; Research Triangle Park, NC, 2023. EPA-452/R-23-002

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sectors modeled by the EPA in 2023; therefore, the Agency does not have pre-calculated
Benefit-per-Ton estimates for the combustion turbines sector.

For this analysis, the EPA carefully evaluated the sectors for which BPTs are
currently available. We considered numerous factors, including source locations and
geographic spread; source characteristics such as stack height, temperature and velocity;
and emissions composition as compared to the Combustion Turbines sector. We note that
because this NSPS applies to currently unbuilt (or unmodified) sources, the locations of
(future) affected sources is not known. Therefore, an approach matching the spatial
locations of emissions changes is not possible. However, in anticipation of such sources
being dispersed across numerous geographic locations, we determined a national average
BPT approach to be preferred to a state-specific BPT approach (as the latter would require
the EPA to assign greater geographic specificity to the location of future sources than is
supported by current knowledge). Further, we identified three source categories as
potentially representative of the emissions profile of combustion turbines: Electricity
Generating Units (EGUs), oil and natural gas transmission, and industrial boilers. We note
that combustion turbine emissions reductions are projected to largely occur in either EGUs
or gas pipeline compression stations.7 Portions of the EGUs and oil and gas transmission
sectors have similar emissions source characteristics to the sources covered by this
proposed rule.

However, after further analysis, we determined that the BPTs for industrial boilers
would be most consistent with potential impacts from combustion turbines due to several
factors. First, boilers are a closer match to the typical stack height. EGUs typically have
higher stack heights, while oil and gas transmission as a whole has lower stack heights.
EGU stack heights average 225 feet high, while boiler stack heights average 51 feet high.8

7 For more detail, see the Combustion Turbine Inventory and NOx Control Technology Baseline Technical
Support Document

8 Calculations based on data available from https://gaftp.epa.gov/Air/emismod/2022/vl/ancillary_data/
and https://gaftp.epa.gov/Air/emismod/2022/vl/draft/point/flatfiles/. Direct links to data files are

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Boilers are a better match for the regulated sector than EGUs for two additional reasons.
First, because the BPTs calculated for EGUs in EPA's most recent modeling are dominated
by coal-fired rather than gas-fired units. Second, there is no available BPT estimates for
ammonia (NH3) emissons from the EGU sector, which means that disbenefits cannot be
calculated based on BPT estimates from the EGU sector. The EPA considers the boilers
BPTs, which do account for NH3 impacts, a better match for the combustion turbine sector
given the fact that this proposed rule is projected to result in NH3 increases (disbenefits),
which are important to include in the analysis. Boilers are a better match for the regulated
sector than oil and gas transmission due to the spatial distribution of the emissions
sources. Boilers and combustion turbine locations generally follow above-ground economic
drivers of economic production activity. Oil and gas transmission locations are largely
located in oil and gas producing regions, areas with relatively low concentration of
combustion turbines. Fann etal. (2009) note that the spatial composition of emissions
sources is a primary determinant of the health impacts of emissions, making boilers
preferred to oil and gas transmission. The selection of boilers is discussed further in
Appendix A.

In selecting BPTs for industrial boilers as the best fit for estimating potential
benefits (and disbenefits) of this proposed rule, the EPA acknowledges the significant
uncertainty inherent in the benefits estimates presented in this RIA. To help illustrate the
potential impact of this uncertainty, the EPA has also included estimates of the NOx
benefits calculated using the alternative sectors considered (EGUs and Oil & Gas
Transmission).9 These estimates are similar to those generated using the boilers BPTs,
with oil and gas transmission BPTs resulting in NOx benefits estimates that are
approximately 10% lower for short-term/low benefits and 8% lower for long-term/high
benefits than those derived from the boilers BPTs, and the EGU BPTs resulting in NOx

https://gaftp.epa.gov/Air/emismod/2022/vl/draft/point/flatfiles/SmokeFlatFile_POINT_20240321_fixpe
rm.csv.zip,

https://gaftp.epa.gov/Air/emismod/2022/vl/ancillary_data/other_ge_dat_2022hc_17jul2024.zip, and
https://sor-scc-api.epa.gov/sccwebservices/sccsearch/.

9 As noted, NH3 BPTs were not available for EGUs; therefore EPA has not calculated NH3 disbenefits for any
BPTs other than boilers.

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benefits estimates that are approximately 23% lower for short-term/low benefits and 11%
higher for long-term/high benefits than those derived from the boilers BPTs. The EPA
considers all of these estimates to be illustrative of the potential magnitude of NOx benefits
from this proposed rule, but acknowledges the considerable uncertainty attached to these
estimates. Ideally, the EPA would conduct full-scale air quality modeling, or develop sector-
specific BPTs for combustion turbines, to provide a fuller and more precise picture of the
potential benefits (and disbenefits) of this rule at the time it is finalized. It is also important
to note that we were unable to quantify the value of changes in exposure to HAP and
dioxin/furans that may result from this NSPS.

The estimation of BPTs involves analytic uncertainties. BPT estimates reflect the
geographic distribution of the modeled emissions, which may not exactly match the
emission reductions that would occur due to the action, and they may not reflect local
variability in population density, meteorology, exposure, baseline health incidence rates, or
other local factors for any specific location. Reduced-form tools can produce overestimates
or underestimates relative to full-form modeling, depending on the pollutant of interest
and policy scenario (IEc, 2019). In particular, reduced-form approaches should be applied
with caution to policies with large changes in NOx emissions.

The scenario-specific emission inputs developed for this project are currently
available online. The study design and methodology are described in the final report
summarizing the results of the project (IEc, 2019). Results of this project found that the
EPA's BPT approach provided a good approximation to full form air quality modeling for
total PM2.5 benefits in most scenarios, with estimates within 30% of the full form results in
four scenarios and within 60% in the fifth scenario. The report found that reduced form
models performed worse for NOx than for sulfates or elemental carbon. However, the
report did find that the EPA's BPT approach is one of only two approachs which yielded
results within a factor of two of full form modeling for nitrate emissions in all test
scenarios.

This provides some initial understanding of the uncertainty which is associated with
using the BPT approach instead of full-form air quality modeling. However, the limited
sample size makes it difficult to draw conclusive opinions about reduced-form tool

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performance for any particular type of policy scenario, and the set of policies examined is
not representative of all potential policy scenarios.

EPA has estimated BPT values for 2025 and 2030. For years in between, we use the
nearest available year. Table 13 describes the mapping of modeled years to which BPT year
was used.

Table 13 Mapping from BPT Years to Modeled Years

Modeled Year

BPT Year

2027

2025

2028

2030

2029

2030

2031

2030

2032

2030

4.3.2 Total Health Benefits - PM2.5 - and Ozone- Related Benefits Results

Table 14 lists the estimated PM2.5- and ozone- related benefits per ton applied in
this national level analysis. These estimates are used to generate the total health benefits of
the proposed rule, which represent the total monetized benefits of this proposed rule.

Table 14 BPT values for national industrial boilers used in BPT estimation

Precursor

Pollutant

BPT Year

2% short/low

2% high/long

NOx

2025

$8,770

$71,200

PM2.5

NOx

2025

$15,400

$32,900

PM2.5

NHs

2025

$86,900

$185,000

NOx

2030

$9,390

$78,900

PM2.5

NOx

2030

$16,800

$34,700

PM2.5

NHs

2030

$94,800

$195,000

Notes: The BPTs shown here are reported in the 2019-dollar year. Benefits were estimated in the 2023-

dollar year. The multiplier used to adjust the dollar year in the benefits calculation was 1.1756115
from the dataseries A191RD3A086NBEA_NBD20190101 available at the FRED website.

The total health benefits of NOx reductions are presented in Table 15. Benefits are
estimated using two alternative concentration-response parameters from several
epidemiologic studies when quantifying both PM2.5 and ozone-related mortality. PM2.5-
attributable deaths are quantified using a concentration-response relationships from the
Wu etal. (2020) and Pope etal. (2019) studies. Ozone-attributable deaths are quantified
using a concentration-response relationships from the Zanobetti etal. (2008), Katsouyanni
et al. (2009), and Turner et al. (2016) studies. The measures in this proposed rule are

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estimated to reduce NOx emissions by 198 tons in 2027, 714 tons in 2028,1,229 tons in
2029,1,744 tons in 2030, 2,259 tons in 2031, and 2,659 tons in 2032. Table 15 presents the
monetized value of impacts from these emission reductions, discounted to 2024, along with
the present value (PV) of these discounted values from 2025-2032 as well as the equivalent
annualized value (EAV) for the 8-year period. For the proposed rule, the lower estimate of
the present value in 2024 of the monetized NOx emission reductions is $200 million at a 2
percent discount rate, while the upper estimate is $670 million. The equivalent annualized
value of the lower estimate is $27 million at a 2 percent discount rate, while the upper
estimate is $92 million. All estimates are reported in 2023 dollars. For the full set of
underlying calculations, see the Turbines BPT Workbook, available in the docket for this
action.

Table 15 Monetized Value, Present Value, and Equivalent Annualized Value of NOx
Emission Reductions from Proposed NSPS 2025-2032 (millions, 2023$)

Emission
Year

Ozone

PM2.5

Ozone + PM2

2025

and

2026

and

2027

and

$8.3

$3.6

and

$7.7

$4.6

and

$16

2028

$3.9

and

$33

$14

and

$29

$18

and

$62

2029

$6.8

and

$57

$24

and

$50

$31

and

$110

2030

$9.6

and

$81

$34

and

$71

$44

and

$150

2031

$12

and

$100

$45

and

$92

$57

and

$200

2032

$15

and

$120

$53

and

$110

$67

and

$230

$43

and

$360

$150

and

$320

$200

and

$670

EAV

$5.8

and

$49

$21

and

$43

$27

and

$92

Note: Values rounded to two significant figures. Health benefits for each year are presented in current

[undiscounted] values, while PV and EAV are based on a 2% discount rate. These estimates are based
on BPTs for industrial boilers. Using BPTs for other sectors could yield different results.

The EPA also conducted benefits analyses based on the two alternative considered
sectors: EGUs and oil and gas transmission. The BPT values used in this analysis are
presented in Table 16. The results of this analysis are presented in Table 17, along with the
total results from Table 15 for comparison. Each result is the total NOx benefits combining
PM2.5 and Ozone benefits. The EGU based PV estimate of $150 million is 23% lower than
the industrial boiler based PV estimate of $200 million, while the EGU based PV estimate of
$750 million is 11% higher than the industrial boiler based PV estimate of $670 million.

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The oil and gas transmission based estimate of $180 million is 10% lower than the
industrial boiler based estimate of $200 million, while the oil and gas transmission based
estimate of $620 million is 8% lower than the industrial boiler based estimate of $670
million.

Table 16 BPT values for EGUs and Oil & Natural Gas Transmissions used in Benefits
Estimation

Precursor Pollutant BPT Year 2% short/low 2% high/long

EGUs

03 NOx 2025 $13,800 $98,900

PM2.5 NOx 2025 $7,710 $16,300

PM2.5 NHs 2025

03 NOx 2030 $16,000 $130,000

PM2.5 NOx 2030 $8,640 $17,700

PM2.5 NHs 2030

Oil & Natural Gas Transmissions

03 NOx 2025 $8,190 $67,200

PM2.5 NOx 2025 $13,800 $29,500

PM2.5 NHs 2025 $74,900 $158,000

03 NOx 2030 $8,730 $74,000

PM2.5 NOx 2030 $15,000 $30,900

PM2.5 NHs 2030 $82,500 $168,000

Notes: The BPTs shown here are reported in the 2019-dollar year. Benefits were estimated in the 2023-

dollar year. The multiplier used to adjust the dollar year in the benefits calculation was 1.1756115
from the dataseries A191RD3A086NBEA_NBD20190101 available at the FRED website. BPTs are
unavailable for PM2.5 NH3 emissions in the EGUs sector.

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Table 17 Monetized Value, Present Value, and Equivalent Annualized Value of NOx
Emission Reductions from Proposed NSPS 2025-2032 (millions, 2023$) of
Industrial Boilers, EGUs, and Oil & Gas Transmission

Emission
Year

Industrial Boilers

EGUs

Oil & Gas Transmission

2025

and

2026

and

2027

$4.6

and

$16

$3.4

and

$15

$4.2

and

$15

2028

$18

and

$62

$14

and

$69

$16

and

$57

2029

$31

and

$110

$24

and

$120

$28

and

$98

2030

$44

and

$150

$34

and

$170

$40

and

$140

2031

$57

and

$200

$44

and

$220

$51

and

$180

2032

$67

and

$230

$52

and

$260

$61

and

$210

$200

and

$670

$150

and

$750

$180

and

$620

EAV

$27

and

$92

$21

and

$100

$24

and

$84

Note: Values rounded to two significant figures. Health benefits for each year are presented in current

(undiscounted] values, while PV and EAV are based on a 2% discount rate. Discrepancies between
the percent difference in the PV results for each sector that can be calculated using the values listed
in this table and those provided in the text are because those listed in the text are based on
unrounded results.

4.4 Benefits of Sulfur Dioxide Reductions

High concentrations of sulfur dioxide (SO2) can cause inflammation and irritation of
the respiratory system, especially during physical activity. Exposure to very high levels of
SO2 can lead to burning of the nose and throat, breathing difficulties, severe airway
obstruction, and can be life threatening. Long term exposure to persistent levels of SO2 can
lead to changes in lung function. Sensitive populations include asthmatics, individuals with
bronchitis or emphysema, children, and the elderly (U.S. EPA, 2017b). PM can also be
formed from SO2 emissions. Secondary PM is formed in the atmosphere through a number
of physical and chemical processes that transform gases, such as SO2, into particles. Overall,
emissions of SO2 can lead to some of the effects discussed in this section—either those
directly related to SO2 emissions, or the effects of PM resulting from the combination of SO2
with other pollutants. Further, SO2 emissions can lead to acid deposition, with adverse
effects on aquatic and terrestrial ecosystems (U.S. EPA, 2020b). Proposing to maintain the
standards of performance for emissions of SO2 from all stationary combustion turbines
would continue to protect human health and the environment from the adverse effects
mentioned above.

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4.5 Disbenefits from Increased Ammonia Emissions

As previously mentioned, ammonia is a precursor to PM2.5 formation. Using the
estimated ammonia emission increases reported in Table 10, the EPA estimated the
monetized disbenefits associated with increased ammonia as a precursor to PM2.5 using the
same "benefit-per-ton" approach as was used for NOx. These results are presented in Table
18. The present value of the disbenefit is estimated to be $76 million dollars and $160
million dollars, corresponding to an EAV of $10 million dollars and $21 million dollars
(2023$).

Table 18 Monetized Value, Present Value, and Equivalent Annualized Value of

Ammonia Emission Increases from Proposed NSPS 2025-2032 (millions,
2023$)

Emission Year

PM2.5

2025

and

2026

and

2027

C$2.1)

and

C$4.6)

2028

C$7.2)

and

C$15)

2029

C$12)

and

C$25)

2030

C$17)

and

C$35)

2031

C$22)

and

C$45)

2032

C$26)

and

C$53)

C$76)

and

C$160)

EAV

C$10)

and

C$21)

Note: A number in parentheses represents a negative value. Values rounded to two significant figures.

Health benefits for each year are presented in current (undiscounted) values, while PV and EAV are
based on a 2% discount rate. These estimates are based on BPTs for industrial boilers. Using BPTs for
other sectors could yield different results. BPTs are unavailable for PM2.5 NH3 emissions in the EGUs
sector, thus monetized disbenefits from increased NH3 emissions could not be calculated for this
sector. Using BPTs for oil and gas transmission yields results that are 13% higher for short-term/low
benefits (-$66 million rounded to 2 significant figures) and 14% higher for long-term/high benefits f-
$130 million rounded to 2 significant figures).

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4.6 Disbenefits from Increased CO2 Emissions

The EPA monetizes the climate impacts of CO2 emissions changes expected from this
proposed rule using estimates of the social cost of carbon (SC- CO2). The SC-CO2 is the
monetary value of the net harm to society associated with a marginal increase in CO2
emissions in a given year, or the benefit of avoiding that increase. In principle, SC-CO2
includes the value of all climate change impacts (both negative and positive), including (but
not limited to) changes in net agricultural productivity, human health effects, property
damage from increased flood risk and natural disasters, disruption of energy systems, risk
of conflict, environmental migration, and the value of ecosystem services. The SC-CO2,
therefore, reflects the societal value of changing CO2 emissions by one metric ton and is the
theoretically appropriate value to use in conducting benefit-cost analyses of policies that
affect CChemissions. In practice, data and modeling limitations restrain the ability of SC-CO2
estimates to include all physical, ecological, and economic impacts of climate change,
implicitly assigning a value of zero to the omitted climate damages. The estimates are,
therefore, a partial accounting of climate change impacts and likely underestimate the
marginal impacts of abatement.

The EPA estimates the climate disbenefits of CO2 emissions increases expected from
this proposed rule using an updated set of SC-CO2 estimates that reflect recent advances in
the scientific literature on climate change and its economic impacts and incorporate
recommendations made by the National Academies of Science, Engineering, and Medicine
(National Academies, 2017). The EPA published and used these estimates in the RIA for the
December 2023 Final Oil and Gas NSPS/EG Rulemaking, "Standards of Performance for
New, Reconstructed, and Modified Sources and Emissions Guidelines for Existing Sources:
Oil and Natural Gas Sector Climate Review" (U.S. EPA, 2023a), and the methodology is
explained in detail in U.S. EPA (2023b). EPA solicited public comment on the methodology
and use of these estimates in the RIA for the agency's December 2022 Oil and Gas NSPS/EG
Supplemental Proposal (U.S. EPA, 2022) and has conducted an external peer review of
these estimates. The RIAs of two recent EPA regulations, "New Source Performance
Standards for GHG Emissions from New and Reconstructed EGUs; Emission Guidelines for
GHG Emissions from Existing EGUs; and Repeal of the Affordable Clean Energy Rule" (U.S.

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EPA, 2024b) and the "National Emissions Standards for Hazardous Air Pollutants: Coal- and
Oil- Fired Electric Utility Steam Generating Units Review of the Residual Risk and
Technology Review" (U.S. EPA, 2024c) also lay out the details of the updated SC-CO2 used
within this proposed rule.

One of the methodological updates the EPA adopted in the CO2 estimates used in
this RIA is the use of a dynamic discounting approach that more fully captures the role of
uncertainty in the discount rate. The SC-CO2 estimates rely on discount rates that reflect
more recent data on the consumption interest rate and uncertainty in future rates.
Specifically, rather than using a constant discount rate, the evolution of the discount rate
over time is defined following the latest empirical evidence on interest rate uncertainty and
using a framework originally developed by Ramsey (1928) that connects economic growth
and interest rates. The Ramsey approach explicitly reflects (1) preferences for utility in one
period relative to utility in a later period and (2) the value of additional consumption as
income changes. The dynamic discount rates used to develop the SC-GHG estimates applied
in this RIA have been calibrated following the Newell et al. (2022) approach, as applied in
Rennert et al. (2022a) and Rennert et al. (2022b). This approach uses the Ramsey
discounting formula in which the parameters are calibrated such that (1) the decline in the
certainty-equivalent discount rate matches the latest empirical evidence on interest rate
uncertainty estimated by Bauer and Rudebusch (2020; 2023) and (2) the average of the
certainty equivalent discount rate over the first decade matches a near-term consumption
rate of interest. Uncertainty in the starting rate is addressed by using three near-term
target rates (1.5, 2.0, and 2.5 percent) based on multiple lines of evidence on observed
market interest rates.

The resulting dynamic discount rate provides a notable improvement over the
constant discount rate framework used for SC-GHG estimation in previous EPA analyses.
Specifically, it provides internal consistency within the modeling and a more complete
accounting of uncertainty consistent with economic theory (Arrow et al., 2013; Cropper et
al., 2014) and the National Academies (2017) recommendation to employ a more
structural, Ramsey-like approach to discounting that explicitly recognizes the relationship
between economic growth and discounting uncertainty. This approach is also consistent

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with the National Academies (2017) recommendation to use three sets of Ramsey
parameters that reflect a range of near-term certainty-equivalent discount rates and are
consistent with theory and empirical evidence on consumption rate uncertainty.

Table 19 presents the monetized value of the CO2 impacts from this proposed rule,
discounted to 2024, along with the present value (PV) of these discounted values from
2025-2032 as well as the equivalent annualized value (EAV) for the 8-year period.

Table 19 Discounted Monetized Value, Present Value, and Equivalent Annualized

Value of CO2 Emissions Changes from Proposed Rule 2025-2032 (millions,
2023$)

CO2

Emission Year

2.50%

Ramsey discount rate
2.00%

1.50%

2025

$0.00

2026

$0.00

2027

($0.21)

($0.35)

($0.60)

2028

($0.65)

($1.07)

($1.83)

2029

($1.08)

($1.78)

($3.06)

2030

($1.51)

($2.49)

($4.28)

2031

($1.94)

($3.19)

($5.49)

2032

($2.29)

($3.76)

($6.51)

($7.69)

($12.6)

($21.8)

EAV

($1.07)

($1.72)

($2.91)

Note: Monetized climate impacts are based on increases in CO2 emissions and are calculated using three
different estimates of the SC-CO2 (2.5 percent, 2 percent, and 1.5 percent near-term discount rates)
from U.S. EPA (2023b). A number in parentheses represents a negative value.

4.7 Characterization of Uncertainty in Monetized Health Benefits

In any complex analysis using estimated parameters and inputs from a variety of
models, there are likely to be many sources of uncertainty. This analysis is no exception.
This analysis includes many data sources as inputs, including emission inventories, air
quality data from models (with their associated parameters and inputs), population data,
population estimates, health effect estimates from epidemiology studies, economic data for
monetizing benefits, and assumptions regarding the future state of the world (i.e.,
regulations, technology, and human behavior). Each of these inputs are uncertain and
generate uncertainty in the benefits estimate. When the uncertainties from each stage of
the analysis are compounded, even small uncertainties can have large effects on the total

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quantified benefits. Therefore, the estimates of annual benefits should be viewed as
representative of the magnitude of benefits expected, rather than the actual benefits that
would occur every year.

As acknowledged in section 4.3, the EPA has utilized a BPT approach to estimate the
monetized benefits of this proposed rule, which introduces substantial uncertainty into the
benefits estimates. Furthermore, because the Agency did not have a sector-specific BPT for
combustion turbines, we used BPTs from the industrial boilers sector to calculate the
potential benefits from this proposed rule and also presented sensitivity analyses based on
BPTs from the EGU sector and Oil & Gas Transmission sector as alternatives. These
approaches introduce substantial uncertainty into the benefits estimates presented in this
RIA.

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5 ENVIRONMENTAL JUSTICE ANALYSIS

5.1 Introduction

For purposes of analyzing regulatory impacts, the EPA relies upon its June 2016
"Technical Guidance for Assessing Environmental Justice in Regulatory Analysis," which
provides recommendations that encourage analysts to conduct the highest quality analysis
feasible, recognizing that data limitations, time, resource constraints, and analytical
challenges will vary by media and circumstance. The Technical Guidance states that a
regulatory action may involve potential EJ concerns if it could: (1) create new
disproportionate impacts on communities with EJ concerns; (2) exacerbate existing
disproportionate impacts on communities with EJ concerns; or (3) present opportunities to
address existing disproportionate impacts on communities with EJ concerns through this
action under development.

The EPA's EJ technical guidance states that "[t]he analysis of potential EJ concerns
for regulatory actions should address three questions: (A) Are there potential EJ concerns
associated with environmental stressors affected by the regulatory action for population
groups of concern in the baseline? (B) Are there potential EJ concerns associated with
environmental stressors affected by the regulatory action for population groups of concern
for the regulatory option(s) under consideration? (C) For the regulatory option(s) under
consideration, are potential EJ concerns created or mitigated compared to the baseline?"10
The environmental justice analysis is presented for the purpose of providing the public
with as full as possible an understanding of the potential impacts of this proposed action.
The EPA notes that analysis of such impacts is distinct from the determinations proposed

10 "Technical Guidance for Assessing Environmental Justice in Regulatory Analysis", U.S. EPA, June 2016.
Quote is from Section 3 - Key Analytic Considerations, page 11.

https://www.epa.gov/environmentaljustice/technical-guidance-assessing-environmental-justice-
regulatory-analysis

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in this action under CAA section 111, which are based solely on the statutory factors the
EPA is required to consider under that section.

5.2 Demographic Analysis

The locations of newly constructed sources that will become subject to the proposed
Stationary Combustion Turbines and Stationary Gas Turbines NSPS (40 CFR 60, Subpart
KKKKa) are not known. Therefore, to examine the potential for any EJ issues that might be
associated with the proposed NSPS, we performed a proximity demographic analysis for
130 existing facilities that are currently subject to NSPS subpart KKKK. These represent
facilities that might modify or reconstruct in the future and become subject to the proposed
KKKKa requirements. This proximity demographic analysis characterized the individual
demographic groups of the populations living within 5 km (~3 miles) and within 50 km
(~31 miles) of the existing facilities. The 5 km radius was used for the near proximity
because it captures a large enough population to provide demographic data without
excessive uncertainty for most facilities. We do note, however, that one facility has zero
population living within 5 km and another two facilities have less than 100 people living
within 5 km. The EPA then compared the data from this analysis to the national average for
each of the demographic groups.

It should be noted that proximity to affected facilities does not indicate that any
exposures or impacts will occur and should not be interpreted as a direct measure of
exposure or impact. This limits the usefulness of proximity analyses when attempting to
answer questions from EPA's EJ Technical Guidance.11

The results of the proximity demographic analysis are shown in Table 20. The
percent of the population living within 5 km of existing facilities with stationary
combustion turbines is above the national average for the following racial/ethnicity
demographics: Black (14 percent versus 12 percent nationally), Hispanic/Latino (20
percent versus 19 percent nationally), and Asian (9 percent versus 6 percent nationally). In

11 The proximity analysis is an analysis of the populations living around the facilities and their demographic
makeup. It does not include an analysis of impacts/exposures. Therefore, there is no quantitative baseline
versus post-control demographics

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addition, the percent of population living within 5 km of the existing facilities with
stationary combustion turbines is above the national average for the following
demographics: people living below the poverty level (15 percent versus 13 percent
nationally), people living below two times the poverty level (30 percent versus 29 percent
nationally), linguistic isolation (6 percent versus 5 percent nationally), and people with one
or more disabilities (13 percent versus 12 percent nationally).

The percent of the population living within 50 km of existing facilities with
stationary combustion turbines is above the national average for the following
racial/ethnicity demographics are: Black (14 percent versus 12 percent nationally),
Hispanic/Latino (22 percent versus 19 percent nationally), and Asian (7 percent versus 6
percent nationally). In addition, the percent of population living within 50 km of existing
facilities with stationary combustion turbines and stationary gas turbines is above the
national average for linguistic isolation (7 percent versus 5 percent nationally) and people
with one or more disabilities (13 percent versus 12 percent nationally).

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Table 20 Proximity Demographic Assessment Results for Stationary Combustion
Turbines NSPS

Demographic Group

Nationwide

Population within Population within

50 km of 5 km

Representative of Representative

Facilities Facilities

Tolal Population

White
Black

American Indian and Alaska Native
Asian

Hispanic or Latino (white and nonwhite]
Other and Multiracial

Age (J Lo 17 years
Age 18 to 64 years
Age > (').") years

Below Poverty Level
Below 2x Poverty Level

Over 27i and uilhoul a High School Diploma

Linguistically Isolated

331.3fi0.07."> Il.~j.000.7fi7 6,177,176

Kaceaiul Llhnicilv hv I'ercenl

58%
12%
0.5%
6%
10%
4%

61%
17%

13%
20%

52% 52%

14% 14%

0.2% 0.3%

7% 0%

22% 20%

4% 4%
Age hy I'ercenl

21% 10%

62% 67%

16% 14%
Income hy I'ercenl

12% 15%

27% 30%
lltlucalion hy I'ercenl

11% 10%
Linguistically Isolaled hy I'ercenl

5% 7% 6%

People wilh One or More Disabilities 12% 13% 13%

Notes: The demographic percentages are based on the 2020 Decennial Census' block populations, which are
linked to the Census' 2018-2022 American Community Survey (ACS) five-year demographic averages
at the block group or tract level. To derive demographic percentages, it is assumed a block's
demographics are the same as the block group or tract in which it is contained. Demographics are
tallied for all blocks falling within the indicated radius.

To avoid double counting, the "Hispanic or Latino" category is treated as a distinct demographic
category for these analyses. A person is identified as one of six racial/ethnic categories above: White,
Black, American Indian or Alaska Native, Asian, Other and Multiracial, or Hispanic/Latino. A person
who identifies as Hispanic or Latino is counted as Hispanic/Latino for this analysis, regardless of
what race this person may have also identified as in the Census.

As indicated above, the locations of any new stationary combustion turbines that
would be subject to NSPS subpart KKKKa are not known. In addition, it is not known which
existing turbines may be modified or reconstructed and subject to NSPS subpart KKKKa.
Thus, we are limited in our ability to estimate the potential EJ impacts of this proposed
rule. However, we anticipate the changes to NSPS subpart KKKKa will generally minimize

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future emissions in surrounding communities from new, modified, or reconstructed
turbines. Specifically, the EPA is proposing that the standards should be revised downward
based on the identification of SCR as the BSER for limiting NOx for certain larger and/or
higher operating combustion turbines and based on updated information concerning
improved combustion control performance at all combustion turbines firing natural gas.
The changes will have beneficial effects on air quality and public health for populations
exposed to emissions from new, modified, or reconstructed stationary combustion turbines
and will provide additional health protection for most populations, including communities
with EJ concerns.

The methodology and the results (including facility-specific results) of the
demographic analysis are presented in the document titled Analysis of Demographic Factors
for Populations Living Near Existing Facilities Subject to the Stationary Combustion Turbines
and Stationary Gas Turbines NSPS (Subpart KKKK and KKKKa), which is available in the
docket for this action.

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6 ECONOMIC AND SMALL BUSINESS IMPACTS

6.1 Introduction

This chapter presents the economic and small business impact analyses performed
for this rulemaking. Section 6.2 describes the screening analysis that was performed to
determine the impacts to small entities impacted by this proposed rule. Section 6.3
discusses the potential economic impacts of this proposed rule, while Section 6.4 concludes
with a discussion of potential employment impacts of the proposed rule.

6.2 Screening Analysis

This section investigates characteristics of businesses and government entities that
are likely to install new combustion turbines affected by this proposed rule and provides a
preliminary screening-level analysis to assist in determining whether this proposed rule is
likely to impose a significant impact on a substantial number of the small businesses within
this industry. The analysis compares compliance costs to revenues at the ultimate parent
company level. This is known as the cost-to-revenue or cost-to-sales test, or the "sales test."
The sales test is an impact methodology the EPA employs in analyzing entity impacts as
opposed to a "profits test," in which annualized compliance costs are calculated as a share
of profits. The sales testis frequently used because revenues or sales data are commonly
available for entities impacted by the EPA regulations, and profits data normally made
available are often not the true profit earned by firms because of accounting and tax
considerations. Also, the use of a sales test for estimating small business impacts for a
rulemaking is consistent with guidance offered by the EPA on compliance with the
Regulatory Flexibility Act and is consistent with guidance published by the U.S. Small
Business Administration's Office of Advocacy that suggests that cost as a percentage of total
revenues is a metric for evaluating cost increases on small entities in relation to increases
on large entities (U.S. SBA, 2017).12

12 The RFA compliance guidance to the EPA rule writers can be found at

https://www.epa.gov/sites/default/files/2015-06/documents/guidance-regflexact.pdf.

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In this analysis, a small entity is defined as: (1) a small business as defined by the
Small Business Administration's (SBA) regulations at 13 CFR § 121.201; (2) a small
governmental jurisdiction that is a government of a city, county, town, school district or
special district with a population of less than 50,000; and (3) a small organization that is
any not-for-profit enterprise that is independently owned and operated and is not
dominant in its field. For the purposes of the RFA, States and tribal governments are not
considered small governments.

Section 6.2.1 describes the process for identification of small entities, and the small
business impacts analysis is presented and discussed in Section 6.2.2.

6.2.1 Identification of Small Entities

As described in Section 3.2, the EPA projects that approximately 68 new, modified,
or reconstructed combustion turbines will begin operation each year. Approximately 13
sources are expected to incur additional costs associated with running their existing
controls more. No existing combustion turbines will be affected by the regulation. Because
it is not possible to project specific companies or government organizations that will
purchase combustion turbines in the future, the small entity screening analysis for the
combustion turbine rule is based on the evaluation of owners of combustion turbines
constructed within the past five years. It is assumed that the existing size and ownership
distribution of combustion turbines in this dataset is representative of the future growth in
new combustion turbines.

Excluding turbines with an ultimate owner of a state, local, or foreign government,
the ultimate owners of combustion turbines constructed within the past five years fall into
one of the NAICS codes in Table 21, which also presents the associated SBA small entity
size threshold for each NAICS code.13 These NAICS differ from the broader groups shown in
Table 4 because the NAICS code of the ultimate owner is based on the primary activity of

13 The table of SBA's Small Business Size Standards is available at https://www.sba.gov/document/support-
table-size-standards.

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the company as a whole, while the NAICS code reported in the NEI is for a particular
facility.

Table 21 Affected NAICS Codes and SBA Small Entity Size Standards

NAICS
Code

NAICS Industry Description

Size
standards in
millions of
dollars

Size
standards in
number of
employees

211120

Crude Petroleum Extraction

1,250

221112

Fossil Fuel Electric Power Generation

950

221118

Other Electric Power Generation

650

221122

Electric Power Distribution

1,100

221210

Natural Gas Distribution

1,150

237990

Other Heavy and Civil Engineering Construction

$45.0

311221

Wet Corn Milling and Starch Manufacturing

1,300

322120

Paper Mills

1,250

322291

Sanitary Paper Product Manufacturing

1,500

322299

All Other Converted Paper Product Manufacturing

500

325193

Ethyl Alcohol Manufacturing

1,000

325211

Plastics Material and Resin Manufacturing

1,250

325412

Pharmaceutical Preparation Manufacturing

1,300

325520

Adhesive Manufacturing

550

333613
423610
423990
424720
486210

Mechanical Power Transmission Equipment
Manufacturing

Electrical Apparatus and Equipment, Wiring Supplies,
and Related Equipment Merchant Wholesalers
Other Miscellaneous Durable Goods Merchant
Wholesalers

Petroleum and Petroleum Products Merchant
Wholesalers (except Bulk Stations and Terminals)
Pipeline Transportation of Natural Gas

$41.5

750
200
100
200

523150

Investment Banking and Securities Intermediation

$47.0

523910

Miscellaneous Intermediation

$47.0

524126

Direct Property and Casually Insurance Carriers

1,500

525910

Open-End Investment Funds

$40.0

532411
541330

Commercial Air, Rail, and Water Transportation
Equipment Rental and Leasing
Engineering Services

$45.5
$25.5

541715
551112

Research and Development in the Physical,
Engineering, and Life Sciences (except Nanotechnology
and Biotechnology) 11
Offices of Other Holding Companies

$45.5

1,000

611310

Colleges, Universities and Professional Schools

$34.5

622110

General Medical and Surgical Hospitals

$47.0

813110

Religious Organizations

$13.0

Source: U.S. SBATable of Size Standards (March 17,2023),

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6.2.2 Small Business Impacts Analysis

Based on SBA criteria, 11 of the ultimate parent companies, owning 15 turbines
(7.8% of the turbines constructed within the past 5 years), are small entities. One of the
municipalities owning turbines constructed within the past five years is considered small.
This implies that approximately 2 of the 22 new affected units each year that are expected
to incur additional costs will be owned by a small entity. The 11 small entities have an
average sales value of approximately $497 million and a median sales value of
approximately $50.9 million. We compared the average annual total compliance cost per
unit in 2027 from Table 8 ($8,011,000/16 = $488,464) with the average sales for a typical
small entity and estimate that the cost to sales ratio for the potentially affected small entity
is 0.1 percent. Comparing the average annual total compliance cost per unit in 2027 from
Table 8 ($8,011,000/16 = $488,464) with the median sales for a typical small entity, we
estimate that the cost to sales ratio for the potentially affected small entity is 0.96 percent.
The average sales value and median sales value are used due to uncertainty in the
individual values. Many of the small entities that have constructed turbines within the past
five years are privately held, and there is considerable uncertainty surrounding the sales
estimates provided for them by D&B Hoovers. There is also uncertainty regarding the
implicit assumption that the same types of small entities will construct turbines in the
future. Because the proposed rule would affect new sources, any additional costs should
factor into the decision to proceed with a project, and could lead to a different type of
project being undertaken. Based on our analysis, there are no significant economic impacts
on a substantial number of small entities (SISNOSE) from this proposed rule.

It is important to note that the cost-to-sales ratio estimated in this analysis may be
overstated or understated depending on the accuracy of the information in the underlying
data on parent company ownership and parent company revenues in addition to the
accuracy of the estimate of increased operating costs. The annual sales values for ultimate
parent companies were derived from multiple sources, including D&B Hoovers, company
reports, and Securities and Exchange Commission (SEC) filings. However, as previously
noted, many of the small entities in this industry are privately held and do not publicly
report their sales, so there is considerable uncertainty regarding the accuracy of this data.

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Furthermore, the assumption that the average sales of any new affected small entity will be
equal to the average sales of the existing small entities is a source of uncertainty.

6.3 Economic Impacts

Economic impact analyses focus on changes in market prices and output levels. If
changes in market prices and output levels in the primary markets are significant enough,
impacts on other markets may also be examined. Both the magnitude of costs needed to
comply with a rule and the distribution of these costs among affected facilities can have a
role in determining how the market will change in response to a rule.

This proposed rule requires new, modified, or reconstructed stationary combustion
turbines to meet emission standards for the release of NOx into the environment. While the
units impacted by these requirements are expected to already have installed any required
emissions control devices, some units are expected to incur increased operating costs of
their existing controls to meet the proposed requirements. These changes may result in
higher costs of production for affected producers and impact broader product markets if
these costs are transmitted through market relationships.

However, because the increased operating costs discussed in Section 3.3 are small in
comparison to the sales of the average owner of a combustion turbine, the costs of this
proposed rule are not expected to result in a significant market impact, regardless of
whether they are passed on through market relationships or absorbed by the firms.

6.4 Employment Impacts

This section presents an overview of the various ways that environmental
regulation can affect employment. Employment impacts of environmental regulations are
generally composed of a mix of potential declines and gains in different areas of the
economy over time. Regulatory employment impacts can vary across occupations, regions,
and industries; by labor and product demand and supply elasticities; and in response to
other labor market conditions. Isolating such impacts is a challenge, as they are difficult to
disentangle from employment impacts caused by a wide variety of ongoing, concurrent
economic changes. The EPA continues to explore the relevant theoretical and empirical

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literature and to seek public comments in order to ensure that the way the EPA
characterizes the employment effects of its regulations is reasonable and informative.

Environmental regulation "typically affects the distribution of employment among
industries rather than the general employment level" (Arrow et al., 1996). Even if impacts
are small after long-run market adjustments to full employment, many regulatory actions
have transitional effects in the short run (U.S. OMB, 2015). These movements of workers in
and out of jobs in response to environmental regulation are potentially important and of
interest to policymakers. Transitional job losses have consequences for workers that
operate in declining industries or occupations, have limited capacity to migrate, or live in
communities or regions with high unemployment rates.

As indicated by the potential impacts on industries using combustion turbines
discussed in Section 6.3, this proposed rule is not projected to cause large changes in those
industries. As a result, the labor employed in those industries is not expected to experience
significant impacts due to this proposed rule.

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7 COMPARISON OF COSTS AND BENEFITS

7.1 Results

The net benefits for the proposed NSPS for combustion turbines are presented in
Table 22. This table includes the present values (PV) and the equivalent annualized values
(EAV) of the costs and benefits of the proposed NSPS.

Table 22 Summary of Benefits, Costs and Net Benefits for the Proposed NSPS for
Combustion Turbines from 2025 to 2032 (millions, 2023$)

2% Discount Rate

PV EAV

$151 and $749 $20.6 and $102

Monetized Benefits1 $195 and $674 $26.7 and $92.0

Alternative Calculation of Monetized
Benefits2

Total Annual Costs $166 $22.6

Monetized Disbenefits1 $88.4 and $169 $12.1 and $23.0

Any other climate, health, and environmental impacts or costs
associated with increased use of existing emissions controls
including non-monetized impacts of NOx and NH3 as well as
effects of other criteria and hazardous air polllutants

Non-Monetized Impacts

Net Benefits1 -$58.7 and $340 -$8.01 and $46.4

Note: Values rounded to three significant figures. Monetized benefits were calculated using BPT estimates.
The BPT estimates comprise several point estimates of mortality and morbidity. The two benefits estimates
are separated by the word "and" to signify that they are two separate estimates and do not represent lower-
and upper-bound estimates

1 Monetized benefits, disbenefits and net benefits are estimated using Industrial Boiler BPTs (see Chapter 4)

2 Alternative calculations for monetized benefits are estimated using the BPTs for EGUs and Oil & Gas
Transmission (see Chapter 4). Using BPTs for EGUs yields results that are 23% lower for short-term/low
benefits and 11% higher for long-term/high benefits, while using BPTs for oil and gas transmission yields
results that are 10% lower for short-term/low benefits and 8% lower for long-term/high benefits.

7.2 Shadow Price of Capital

Regulations that displace or induce capital investment may have additional social
benefits and/or costs relative to regulations that only affect consumption. Market
distortions, such as taxes on capital income, cause the private returns on capital
investments to be lower than the social returns. Therefore, the social benefits and costs of
capital investment induced or displaced by a regulation will exceed the private value of
those changes in capital investments. For the current rule, EPA does not have reason to
expect a substantial impact on capital investment in across the economy because the U.S.
operates in a global economy with high capital mobility. However, we consider the
implications of such an outcome.

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In general, the analytically preferred approach to address the displacement or
inducement of capital investment is to convert changes in capital investment into
consumption equivalents using the shadow price of capital, which can then be discounted
at the consumption discount rate. The shadow price of capital reflects the amount of
additional consumption that would be required to make society indifferent to losing a
dollar of investment in the same period. Implementing this approach requires both a
suitable estimate of the shadow price of capital and an estimate of the regulatory incidence
that falls on capital investment versus consumption.

The distribution of benefits and costs across capital investment and consumption
are not readily available in general, and that is true for the current rule. The effect of
regulatory costs on private investment will depend upon ultimate distribution of costs
across different households and firms and their marginal propensity to save, in addition to
the elasticity of international investment flows (Lyon, 1990). The net effect of a regulation
on the stock of productive private capital will also depend on how the benefits (e.g., labor
productivity increases in the case of the current rulemaking) impact the investment
decisions of firms and households (Bradford, 1975). There are also uncertainties as to the
appropriate shadow price of capital, which requires information on differences between
the consumption discount rate and the social opportunity cost of private capital, the
depreciation rate, and reinvestment rates (Li and Pizer, 2021). The appropriate value to
apply will also depend on the type of private investment affected (e.g., corporate vs. non-
corporate) as the rate of return will depend on the characteristics of capital stock being
impacted (Lyon, 1990).

Given these and other uncertainties, Circular A-4 (U.S. OMB, 2023) suggests
examining the sensitivity of the benefit and cost estimates to potential impacts on private
capital using a range of shadow prices (1.0 and 1.2) in cases where the benefits and costs
fully induce or displace private investment, respectively. Under this approach, the range of
net benefits in the sensitivity analysis is defined on the lower end by costs fully displacing
capital investment and on the high end by benefits fulling inducing capital investment,
using a shadow price of capital of 1.2 in both cases.

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This analysis adopts the Circular A-4 sensitivity analysis approach. For the purpose
of this analysis, the monetized disbenefits are considered costs of the proposed
requirements. As shown in Table 23, under the primary estimate monetized net benefits
are -$59 million and $340 million under a 2% consumption discount rate. If all costs were
assumed to displace investment the monetized net benefits estimate would be -$110
million and $273 million and if all benefits were assumed to induce investment the
monetized net benefits would be -$20 million and $474 million. All estimates are reported
in 2023 dollars and are calculated over the 2025-2032 analytical timeframe described
earlier in this RIA.

Table 23 Sensitivity of Net Benefits to Potential Impacts on Capital Investment
(Million 2023$)

Sensitivity Assuming
Costs Fully Displace
Capital Investment

Primary Analysis

Sensitivity Assuming
Benefits Fully Induce
Capital Investment

Benefits $195 and $674
Costs $199
Disbenefits $106 and $202

$195 and $674
$166

$88 and $169

$234 and $809
$166

$88 and $169

Net Benefits -$110 and $273

-$59 and $340

-$20 and $474

Note: Monetized benefits were calculated using BPT estimates. The BPT estimates comprise several point

estimates of mortality and morbidity. The two benefits estimates are separated by the word "and" to
signify that they are two separate estimates and do not represent lower- and upper-bound estimates

7.3 Uncertainties and Limitations

The analysis presented in this RIA is subject to many sources of uncertainty. The
EPA is unable to precisely predict the number or location of combustion turbines likely to
be constructed, modified, or reconstructed in the future, and therefore has to rely upon
recent history to project the future. As noted in Chapter 3, the proposed rule does not
dictate that controls must be installed to control pollutants, but rather that new, modified,
and reconstructed turbines must meet emission standards consistent with the BSER for
that unit. If the owners of affected units are able to find alternative methods to comply,
then the costs presented in this RIA may be overestimates. Likewise, the costs may be
underestimated if the variable cost associated with running existing controls more was
underestimated in the cost analysis or if the controls the EPA assumed will be needed are
not able to obtain the required reductions.

-------
Health benefits are monetized using BPT estimates in this RIA. Because BPT values
do not currently exist for the combustion turbines sector, EPA is presenting several
calculations of monetized benefits reflecting estimates using the industrial boilers, EGUs,
and oil and gas transmission BPT values. These sectors were chosen because these sectors
have the most similar emissions characteristics to the regulated sector. This uncertainty is
discussed in Section 4.7.

There is uncertainty in the small business impact assessment. The cost-to-sales ratio
for the small entities expected to be impacted by this proposed rule is based on the average
sales for small entities owning combustion turbines constructed in the past five years.
Because we are unable to precisely predict the number of small entities likely to own new,
modified, or reconstructed turbines that will be affected by this proposed rule, we have
relied upon recent history as a predictor of the future. For the small entities used to
estimate the average sales, we relied upon the best information the EPA had available, but
because the actual sales are often not publicly available and the cost estimates are subject
to the uncertainty described above, the cost-to-sales ratio may overestimate or
underestimate the true impact for affected firms.

Finally, because the EPA lacks an economic model specific to combustion turbines,
we are unable to predict the economic impacts that may be associated with this proposed
rule. However, because the magnitude of the estimated costs is small relative to the overall
sales of the industries likely to be affected by this proposed rule, we do not expect these
costs to result in a significant market impact, regardless of whether they are passed on
through market relationships or absorbed by the firms.

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Wu, X., Braun, D., Schwartz, J., Kioumourtzoglou, M. A., & Dominici, F. (2020). Evaluating the
impact of long-term exposure to fine particulate matter on mortality among the elderly.
Science Advances, 6(29), eaba5692. https://doi.org/10.1126/sciadv.aba5692

Zanobetti, A., & Schwartz, J. (2008). Mortality Displacement in the Association of Ozone
with Mortality. American Journal of Respiratory and Critical Care Medicine, 177(2), 184-
189. https://doi.org/10.1164/rccm.200706-8230C

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APPENDIX A: SELECTING A BPT

The EPA provides estimates of the dollar value of health benefits for use in RIAs. The
primary approach is to use modeling to project changes in emissions, then to use air quality
modeling to project changes in ambient pollution levels based on these emissions changes,
and then to use the Environmental Benefits Mapping Program - Community Edition
(BenMAP-CE) to calculate and monetize changes in health outcomes based on changes in
ambient pollution levels. This approach is computationally intensive and requires months
to complete. Whenever possible, the EPA strives to estimate health benefits using this
primary "full form" approach. However, in some situations (e.g., rule development
timelines are compressed) the EPA may determine that the use of "reduced form" benefit
estimation approaches that have been designed to approximate the more detailed analyses
is appropriate.

One such reduced form approach entails the use of pre-computed average health
damages for specific regulated sectors (Fann et al, 2012). These pre-computed average
health damages, called Benefit-per-Ton or BPTs, describe the total monetized health
impacts of each sector or sector-region's emissions divided by the aggregate emissions
level in tons. To date, BPTs have been the most often applied reduced form approach by the
EPA for RIA purposes. As part of the proposed rule to repeal the Clean Power Plan (CPP) in
October 2017, US EPA committed to evaluate the uncertainty associated with reduced-form
techniques, with a goal of better understanding the suitability of such approaches to
estimating the health impacts of emissions changes. In May 2020, the EPA sent the report
"Evaluating Reduced-Form Tools for Estimating Air Quality Benefits" to the Science
Advisory Board (SAB) for external peer review. SAB completed their review in December
2020 and supported targeted usage of BPT-based analyses with two recommendations: a)
that BPTs be periodically updated to reflect the latest emissions inventories and b) that
finer-scale BPTs be developed (e.g., regional or State-level). In 2023, EPA updated BPTs
using an updated 2017 emissions inventory (U.S. EPA, 2023). Sectoral BPTs were
calculated for 3 regions (West, North, South) in all but three sectors and at the State-level

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for the other 3 sectors (industrial boilers, stationary internal combustion engines, and
electricity generating units (EGUs)14).

EPA rulemaking timelines are subject to a variety of constraints including Clean Air
Act deadlines and, in some instances, court-mandated schedules. In cases where regulatory
analyses require quantification of benefits from sectors for which no BPT values exist and
with a timeline too short for new air quality modeling to be undertaken, the EPA must
evaluate whether other appropriate data and methods are available to estimate health
benefits which include using BPT estimates for similar sectors. This Appendix describes the
factors that the EPA considers when determining whether appropriate BPTs are available
and sufficiently similar to quantify health impacts for specific regulatory analyses.

A. 1 Overview of BPTs

The EPA has estimated BPTs for five direct and precursor pollutants that contribute
to PM2.5 and ozone concentrations for a variety of emissions sectors and geographic
regions.15 The BPTs account for directly emitted PM2.5 and secondary PM2.5 formation from
SO2, N0X and NH3 as well as atmospheric ozone formation from N0X and VOC. For each
sector-region analyzed, the EPA conducted photochemical source-apportionment air
quality modeling to simulate baseline ambient levels of PM2.5 and ozone and to track the
contributions of emissions from that sector-region to gridded PM2.5 and ozone
concentrations. The EPA then used BenMAP-CE to estimate the monetized health impacts
stemming from the portion of ambient pollution attributed to each sector-region and
divided the aggregate monetized health benefits by the sector-region's emissions. This
provides a quantification of the average benefit ($) for every ton of emissions reduced from
that sector-region.

14 EGU emissions, unlike other sectors, were based on 2026 projected emissions from the 2016v3 platform as
described in the Regulatory Impact Analysis for the Proposed National Emission Standards for Hazardous
Air Pollutants: Coal- and Oil-Fired Electric Utility Steam Generating Units Review of the Residual Risk and
Technology Review; Research Triangle Park, NC, 2023. EPA-452/R-23-002

15 The BPT calculations are described in detail in the Technical Support Document (U.S. EPA, 2023). The BPT
approach was reviewed by an EPA SAB (U.S. EPA, 2021). BPT estimates are available for 2025, 2030, 2035,
and 2040. When analyzing other years, EPA applies the nearest available year.

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Simon et al. (2023) compared the ability of various reduced form tools to replicate
benefits calculated using full-form air quality modeling for a variety of emissions control
scenarios impacting different emissions sectors. The reduced form tools analyzed by Simon
et al. (2023) included the Air Pollution Emission Experiments and Policy analysis model
version 2 (AP2), the Estimating Air pollution Social Impact Using Regression model
(EASIUR), the Interventional Model for Air Pollution (InMAP), U.S. EPA BPTs and Source
Apportionment-Based Air Quality Surfaces (SABAQS), a method that used state-level EGU
source apportionment modeling. Considering both ozone and PM2.5, Simon etal. (2023)
found that BPTs are "generally suitable for use in applications examining impacts of
emissions reductions that are similar in magnitude and geographic scope to those used to
derive the [source apportionment Benefit Per Ton] relationships".16

As noted above, in 2020, an SAB panel reviewed the EPA's approach to reduced
form tools and particularly EPA's approach to comparing reduced form tools and full-form
modeling (U.S. EPA, 2021). The panel broadly endorsed the EPA's approach while offering
suggestions for further explorations and model comparisons.

Table 24 lists national BPT estimates based on 2017 emissions and air quality
modeling and 2025 projected population and demographic data.17 These BPT estimates are
in 2019 dollars. We note that there is variation between sectors. For NOx, directly emitted
PM2.5, and SO2, we see that the second highest and second lowest national BPT differ by a
factor of approximately two (in the case of NOx as an ozone precursor) to four (in the case
of directly emitted directly emitted PM2.5) by sector.

Fann et al. (2009) discuss the factors that cause variation in BPT estimates between
sectors. They highlight three factors. First, differences in "chemical processes that govern
the formation of PM2.5 in the atmosphere"18 due to "base conditions at both the emitting
source and the receptor areas". Second, "characteristics of the emitting source" including

16 Note that "SA BPT" in this context is shorthand for source-apportionment based BPT, which is referred to
just as "BPT" in this document.

17 EPA has BPT values using population and demographic data projections for 2025, 2030,2035, and 2040.

18 While the Fann et al. (2009) paper focused on PM2.5 BPT applications, these same variables are also key for
any secondary pollutant including ozone.

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"stack heights, stack temperatures, and velocity of emissions as they leave the stacks"
which impact the transport and dispersion of pollutants between the emissions location
and the ground-level locations where people are exposed. Third is "the size of the
population exposed to PM2.5 and the susceptibility of that population to adverse health
outcomes". This third factor is primarily impacted by the overlap between locations where
emissions have the largest impact on ground-level pollutant concentrations and population
centers.

In light of these factors, consider a sector such as taconite mining which occurs
primarily in a relatively remote location (portions of northern Minnesota and northern
Michigan) with minimal population exposed. As a result of the location of taconite mining
sources, and all other factors being equal, taconite mining BPTs are lower than other
sectors. Alternatively, consider residential woodsmoke which occurs in close proximity to
people and at ground level such that pollution generally accumulates in the vicinity of the
emissions source. As a result of the location of woodsmoke emissions and the
characteristics of the source, woodsmoke BPTs are higher than other sectors.

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Table 24 National BPTs for 2025

PM2.5-Related Benefits

Ozone-Related
Benefits

Directly

Sector

emitted
PM2.5

S02

NOx

nh3

NOx

voc

Brick kilns

$230,000

$44,400

$27,400

$132,000

$86,600

$11,800

Cement kilns

$158,000

$42,700

$14,700

$65,000

$75,700

$18,500

Coke ovens

$288,000

$53,900

$26,000

$67,600

$36,700

Electric arc furnaces

$46,100

$19,300

$80,500

$7,060

Ferroalloy facilities

$152,000

$45,500

$15,700

$105,000

$7,940

Gasoline distribution

$7,040

Industrial Boilers

$194,000

$42,600

$15,400

$86,900

$71,200

$14,500

Integrated iron & steel

$386,000

$54,100

$23,900

$193,000

$76,800

$14,600

Internal Combustion
Engines

$167,000

$38,800

$10,800

$75,700

$60,200

$9,350

Iron and steel foundries

$265,000

$54,700

$24,300

$93,100

$8,140

Oil and natural gas

$98,800

$19,500

$8,140

$24,400

$49,400

$1,840

Oil and natural gas
transmission

$140,000

$29,900

$13,800

$74,900

$67,200

$8,230

Paint stripping

$7,060

Primary copper smelting

$10,100

$4,200

$54,500

Pulp and paper

$146,000

$39,400

$11,200

$51,500

$83,200

$2,340

Refineries

$369,000

$51,100

$23,200

$112,000

$63,200

$12,700

Residential woodstoves

$479,000

$34,900

$33,400

$203,000

$42,800

$13,500

Secondary lead smelters

$44,500

$23,700

$99,700

Synthetic organic chemical

$141,000

$42,900

$17,100

$71,400

$77,200

$6,090

Taconite mining

$62,600

$33,300

$9,430

$50,300

$32,600

EAF & IIS (combined)

$379,000

$52,800

$23,000

$193,000

$77,500

$12,600

Electricity generating units

$113,000

$57,000

$7,710

$98,900

While Table 24 provides national BPT values, EPA also developed regional BPT
values for North, South and West US regions for all sectors except for industrial boilers,
EGUs and internal combustion engines.19 For industrial boilers, EGUs and internal
combustion engines, EPA developed state-level rather than regional BPT values. Simon et al
(2023) showed that state-level EGU source apportionment modeling paired with BenMAP-
CE was better able to replicate full-form modeling benefits than national-level EGU BPTs
for several EGU emissions control scenarios and noted that source apportionment

19 All BPT results can be accessed from https://gaftp.epa.gov/benmap/bpts/archives/. The BPTs in this
analysis are available at https://gaftp.epa.gov/benmap/bpts/archives/2024%20BPTs/.

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modeling with "more specificity... in terms of source characteristics or spatial scales"
would allow for more accurate replication of full-form approaches.

A.2 Applying BPTs to Unmodeled Sectors

Sectors listed in Table 24 were chosen for inclusion in the BPT analysis based on the
expected size of their impact on ozone and PM2.5 concentrations and the EPA's regulatory
priorities at the time these values were developed. However, the EPA's obligation to
regulate sources under section 111 and 112 of the Clean Air Act is not limited to the sectors
with modeled BPTs. In consideration of the factors discussed earlier from Fann (2009), in
cases where the EPA must quantify rule benefits for a sector without a current BPT value
on a timeline that does not permit full-form modeling, the following considerations are
weighed to determine whether it is appropriate to apply an available BPT value from a
different sector:

(1) Whether the locations and source characteristics (e.g. emissions composition, stack
height, temperature, velocity) of affected sources known at the time of the
rulemaking.

(2) Whether the source characteristics and national spatial distribution of sources for
the regulated source similar to those of one of the sources with an available BPT
value. Note that the absolute magnitude of emissions from the modeled and the
target sector are not as important as the source locations and source characteristics
given the nature of BPT which is normalized by total emissions.

(3) In cases where national spatial distributions do not match a source with an existing
BPT, is finer-resolution regional or state-level BPT data provide sufficient spatial
resolution to adequately represent the proximity of the regulated sources to people.

A.2.1 The Combustion Turbine Sector

This section describes how we consider the above questions as applied to new
sources in the combustion turbine sector.

(1) The locations of affected sources are not known because the proposed rule would
apply to currently unbuilt new sources.

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(2) Timelines for the proposed rule analysis did not provide sufficient time to conduct
new "full form" air quality modeling nor source apportionment modeling that would
be required for creating a sector-specific BPT for combustion turbine sources.

(3) Considering the emissions characteristics of the emissions sources in the
combustion turbine sector as well as the 21 sectors with modeled emissions, three
sectors could be used: industrial boilers, EGUs, and oil and natural gas transmission.
Boilers have similar emissions characteristics, particularly stack height. EGUs and
oil and gas transmission are considered because the emissions reductions in the
proposed rule are projected to occur among EGUs and gas compressors.20 Gas
compressors are a part of the oil and gas transmission sector. Boilers are preferred
to EGUs because the proposed rule includes both reductions in NOx and increases in
NH3 and there are no available BPT estimates for NH3 reductions from the EGU
sector. Boilers are preferred to oil and gas transmission because they are a closer
match to the typical stack height of the regulated sector.

(4) An implicit assumption of the BPT method when applied to the modeled sector is
that the spatial distribution of emissions reductions will follow the same spatial
distribution as the sector's baseline emissions. Applying a BPT to an unmodeled
sector relies on a distinct but related implicit assumption - that the spatial
distribution of emissions reductions in the regulated sector will follow the same
spatial distribution as the modeled sector's baseline emissions. In each case, there is
an assumption of similar underlying economic forces causing the locations of
emissions in the baseline and emissions reductions.

Given the considerations above, it was determined that using the national industrial
boiler BPT values would provide the best ability to match the stack height and spatial
distribution of NOx emissions reductions and account for the NH3 emissions increases

20 For more detail, see the Combustion Turbine Inventory and NOx Control Technology Baseline Technical
Support Document

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anticipated from this proposed rule. The national-level industrial boiler sector provides the
best available match due to similar location and source characteristics.

A.3 Analytic Uncertainty

The use of BPTs based on modeling of a sector other than the unregulated sector
introduces additional uncertainty in the benefits analysis beyond the fundamental
uncertainties associated with full-form modeling (e.g. uncertainties in projections,
statistical sampling) and in the BPT methodology (e.g. discrepancies between the modeled
and actual locations of emissions reductions, nonlinearities in the relationship between
emissions and benefits) as described by Fann et al (2012). For this exercise, EPA performs
quantitative analyses to explore the additional uncertainty. The first approach is to
recalculate the additional health benefits using an additional plausible sector (either at
national- or state-levels) and compare the monetized benefits between the two
calculations. Under the assumption that differences between the modeled sectors are
comparable to differences between the modeled sectors and the regulated sector, the
difference provides an informative estimate of the possible magnitude difference induced
by comparing benefits between sectors.

A.4 References

U.S. EPA. (2021). Review of EPA's Reduced Form Tools Evaluation. U.S. Environmental
Protection Agency, Office of the Administrator, Science Advisory Board, Washington,
DC. December 16, 2020. EPA-SAB-21-001.

https://sab.epa.gov/ords/sab/f?p=114:0:5232573645552:APPLICATION_PROCESS=RE
PORT_DOC:::REPORT_ID:1090

U.S. EPA. (2023). Technical Support Document: Estimating the Benefit per Ton of Reducing
Directly-Emitted PM2.5, PM2.5 Precursors and Ozone Precursors from 21 Sectors. U.S.
Environmental Protection Agency, Office of Air Quality Planning and Standards,
Research Triangle Park, NC. September 2023.

https://www.epa.gOv/system/files/documents/2021-10/source-apportionment-tsd-
oct-2021_0.pdf

Fann, N., Baker, K.R. & Fulcher, C.M. (2012). Characterizing the PM2. 5-related health
benefits of emission reductions for 17 industrial, area and mobile emission sectors
across the US. Environment international 49: 141-151.
https://doi.Org/10.1016/j.envint.2012.08.017

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Fann, N., Fulcher, C.M., & Hubbell, B.J. (2009). The influence of location, source, and
emission type in estimates of the human health benefits of reducing a ton of air
pollution. Air Quality, Atmosphere & Health 2: 169-176.
https://doi.org/10.1007/sll869-009-0044-0

Simon, H., Baker, K.R., Sellers, J., Amend, M., Penn, S.L., Bankert, J., Chan, E.A.W., Fann, N.,
Jang, C., McKinley, G., Zawacki, M., & Roman, H. (2023). Evaluating reduced-form
modeling tools for simulating ozone and PM 2.5 monetized health
impacts. Environmental Science: Atmospheres 3, no. 9: 1306-1318.
https://doi.org/10.1039/D3EA00092C

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United States Office of Air Quality Planning and Standards Publication No. EPA-452/R-24-016

Environmental Protection Health and Environmental Impacts Division November 2024

Agency Research Triangle Park, NC

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