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Update on EPA Activities

Stay informed about the EPA’s activities regarding coal impacts, outage studies, and the proposed Clean Power Plan. Understand the state-specific emission goals, milestones, and SPP’s efforts towards compliance.

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Update on EPA Activities

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  1. Update on EPA Activities MOPC July 15-16, 2014

  2. Topics Covered • Current Known Impacts • Retirements • De-ratings • Outage Impact Studies • Proposed Clean Power Plan

  3. Current known impacts

  4. Impact on Coal in SPP (based on recent survey)

  5. Comparison with ITP 10 Assumptions

  6. Outage Impact Study * • SPP bi-annual study process • Four-year look ahead for reliability issues • Weekly snapshots through the four years • Scheduled outages taken into account • Current studies indicate there will be adequate time to perform generator retrofits necessary to comply with known environmental regulations • Retrofits are expected to impact generation supply economics more than the ability to reliably serve load * Formerly called “EPA Study” 6

  7. Outage Impact Study Resource Adequacy 2014 2014 Weekly Outages 67,678

  8. Outage Impact Study Resource Adequacy 2015 2015 Weekly Outages 67,678

  9. Proposed clean power plan

  10. EPA Clean Power Plan Overview • EPA’s proposed performance standards to reduce CO2 emissions from existing fossil fuel-fired generators • Promulgated under authority of Section 111(d) of the Clean Air Act • Achieves nationwide 30% reduction of CO2 from 2005 levels by 2030 • Proposes state-specific emission rate-based CO2 goals • Based on EPA’s interpretation and application of Best System of Emission Reduction (BSER) • Must be met by 2030

  11. EPA Clean Power Plan Overview • States goals and flexibility • Interim goals applied 2020-2029 that allows states to choose trajectory • Offers guidelines and allows states flexibility to develop and submit State Implementation Plans • States may adopt an equivalent mass-based goal • States can develop individual plans or collaborate with other states • If state does not submit a plan or its plan is not approved, EPA will establish a plan for that state

  12. Clean Power Plan Milestones

  13. BSER is Based on Four Building Blocks *Uses 2012 data for existing units and estimated data for units under construction.

  14. SPP State Goals by 2030 Fossil Unit CO2 Emission Rate Goals and Block Application (lbs/MWh) SPP State Average 2012 Rate = 1,699 SPP State Average 2030 Rate = 1,045 *Includes Future States with IS Generation in SPP (N. Dakota, S. Dakota, Montana, and Wyoming)

  15. SPP State % Emission Reduction Goals Total CO2 Emission Reduction Goals (%) Average of SPP States = 38.5% *Includes Future States with IS Generation in SPP (N. Dakota, S. Dakota, Montana, and Wyoming)

  16. EPA Projected 2016-2020 EGU Retirements(For SPP and Select Neighboring States) *Excludes committed retirements prior to 2016 **AEP provided data extracted from EPA IPM data

  17. SPP State Efforts Underway • Arkansas • ADEQ has already had two stakeholder meetings, June 25th & May 28th • Next stakeholder meeting August 28th • SPP Staff met with ADEQ to provide an SPP overview • Missouri • Stakeholder meeting scheduled by MoPSC on August 18th • Nebraska • SPP Staff meeting with NDEQ and Nebraska utilities on July 30th • Oklahoma • Meeting being scheduled in August with stakeholders • Texas • Public workshop scheduled by PUCT on August 15th

  18. How Can SPP Assist? • Help educate and work with states • Perform impact analyses • Inform stakeholder responses that are due October 16 • Inform current planning efforts • Assist state and member decision making • Facilitate coordinated SPP response to proposed Clean Power Plan • Evaluate and facilitate regional approach • Coordinate with neighbors • Other ways?

  19. SPP’s Proposed Impact Analysis Framework • Perform both reliability and economic analyses • Use 2024 ITPNT and ITP10 Future 2 models as base case • Develop two scenarios • Identify incremental reliability problems and increased APC • Perform gas price sensitivity in economic analysis • Perform load scaling sensitivity in reliability analysis • Report results by October 1

  20. Proposed Impact Analysis Scenarios *Will attempt to use existing capacity to replace coal up to existing capacity margin requirements

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