Air Pollution
Air Quality and Permitting of New Coal-Burning, Electricity-Generating Units in Central Texas Gao ID: GAO-09-787R August 4, 2009Burning coal generates about 50 percent of the nation's electricity and produces air pollution that can pose a significant threat to human health and ecosystems. The Department of Energy (DOE) predicts that demand for electricity will increase nationally by 26 percent between 2007 and 2030, and DOE's Energy Information Administration projects that Texas's electricity demand will steadily increase through 2030. This increasing demand for electricity in Texas has in recent years led to proposals for 33 new coal-burning, electricity-generating units across the state. The Clean Air Act requires the Environmental Protection Agency (EPA) to establish national ambient air quality standards for six pollutants to protect public health and welfare. These six pollutants, also known as criteria pollutants, are carbon monoxide, nitrogen dioxide, sulfur oxides, particulate matter, ozone, and lead. In Texas, ozone is the criteria pollutant of primary concern. States are primarily responsible for ensuring attainment and maintenance of national ambient air quality standards once EPA has established them. States submit state implementation plans to EPA for approval that provide for the attainment and maintenance of air quality standards. If the state fails to submit this plan, submits an inadequate plan, or fails to implement any requirement of the plan, the state could face ineligibility for federal highway funding and may also lose authority to implement Clean Air Act programs. Under the act, the plans include stricter pollution control measures for areas not meeting the national ambient air quality standards, known as nonattainment areas. Steps that states and local governments are required to take under the act to control ozone pollution in nonattainment areas can include strict emission controls on new, modified, and existing industrial facilities; additional planning requirements for transportation sources; and vehicle emissions inspection programs. Once EPA approves a plan, states are generally responsible for implementing the New Source Review and Prevention of Significant Deterioration provisions of the Clean Air Act. When new major sources of air pollution, such as power plants, are proposed, they must undergo New Source Review and, in areas that meet national air quality standards, a Prevention of Significant Deterioration review. New Source Review entails reviewing applications for the proposed power plants to establish emission limits and ensure they utilize appropriate air pollution control technologies. A Prevention of Significant Deterioration review ensures that the emissions from the source will not exceed maximum allowable increases for three of the criteria pollutants--nitrogen dioxide, sulfur oxides, and particulate matter--and that the source will not cause or contribute to a violation of the national air quality standards. Additionally, states generally issue permits for power plants under the Clean Air Act. In Texas, a Prevention of Significant Deterioration permit is issued prior to construction of a power plant and an operating permit shortly before it begins operation. In this report, the term permit refers to the Prevention of Significant Deterioration permit unless stated otherwise. We prepared this report in response to a congressional directive in the Joint Explanatory Statement accompanying the Consolidated Appropriations Act of 2008. This report provides information on (1) the current status of permitting coal-burning, electricity-generating units in Central Texas; (2) the process EPA and Texas use, under the Clean Air Act, to review permit applications for proposed new major sources of air pollution; and (3) what is known about air quality and respiratory health in Central Texas.
When EPA approved Texas's state implementation plan--a plan for attaining and maintaining national air quality standards--the Texas Commission on Environmental Quality (TCEQ), became responsible for reviewing permit applications and issuing permits for proposed new major sources of air pollution. EPA retains oversight to ensure TCEQ adheres to its state implementation plan permit procedures. Regarding EPA's oversight of TCEQ's permitting procedures for new major sources, EPA attempts to resolve any differences with TCEQ related to EPA's review of these permit applications or draft permits before a permit is issued. Additionally, when EPA commented on the draft permits in November 2006, it said it had difficulty evaluating the air quality analyses of the individual permit applications because TCEQ had deemed the applications as complete at the same time and had not assigned a sequential order to them. Current data from TCEQ's air quality monitoring network show Central Texas meets national air quality standards for all six criteria pollutants. However, monitoring data also show ozone concentrations in the region are close to exceeding the new EPA 2008 national ozone standard. Regarding respiratory health in Central Texas, the most recent data available show mortality rates from most respiratory illnesses are slightly higher for the region than for the entire state or the nation as a whole.
GAO-09-787R, Air Pollution: Air Quality and Permitting of New Coal-Burning, Electricity-Generating Units in Central Texas
This is the accessible text file for GAO report number GAO-09-787R
entitled 'Air Pollution: Air Quality and Permitting of New Coal-
Burning, Electricity-Generating Units in Central Texas' which was
released on August 4, 2009.
This text file was formatted by the U.S. Government Accountability
Office (GAO) to be accessible to users with visual impairments, as part
of a longer term project to improve GAO products' accessibility. Every
attempt has been made to maintain the structural and data integrity of
the original printed product. Accessibility features, such as text
descriptions of tables, consecutively numbered footnotes placed at the
end of the file, and the text of agency comment letters, are provided
but may not exactly duplicate the presentation or format of the printed
version. The portable document format (PDF) file is an exact electronic
replica of the printed version. We welcome your feedback. Please E-mail
your comments regarding the contents or accessibility features of this
document to Webmaster@gao.gov.
This is a work of the U.S. government and is not subject to copyright
protection in the United States. It may be reproduced and distributed
in its entirety without further permission from GAO. Because this work
may contain copyrighted images or other material, permission from the
copyright holder may be necessary if you wish to reproduce this
material separately.
GAO-787R:
United States Government Accountability Office:
Washington, DC 20548:
August 4, 2009:
Congressional Addressees:
Subject: Air Pollution: Air Quality and Permitting of New Coal-Burning,
Electricity-Generating Units in Central Texas:
Burning coal generates about 50 percent of the nation's electricity and
produces air pollution that can pose a significant threat to human
health and ecosystems. The Department of Energy (DOE) predicts that
demand for electricity will increase nationally by 26 percent between
2007 and 2030, and DOE's Energy Information Administration projects
that Texas's electricity demand will steadily increase through 2030.
This increasing demand for electricity in Texas has in recent years led
to proposals for 33 new coal-burning, electricity-generating units
across the state.[Footnote 1] Ten of these new units were proposed to
be built in Central Texas, a region where 24 electricity-generating
units, including coal-burning units, already operate. Data from DOE's
Energy Information Administration show the 10 proposed coal-burning
units would add nearly 10 percent to the state's electricity-generating
capacity. However, these proposed units in Central Texas raised
concerns about the potential impact on air quality in the region.
Furthermore, one energy company's simultaneous submission of permit
applications to the state for four coal-burning units to be built in
Central Texas raised questions about whether the state permitting
agency was required to consider the cumulative impact of all four units
as part of the permit application review process.
The Clean Air Act requires the Environmental Protection Agency (EPA) to
establish national ambient air quality standards for six pollutants to
protect public health and welfare. These six pollutants, also known as
criteria pollutants, are carbon monoxide, nitrogen dioxide, sulfur
oxides, particulate matter, ozone, and lead. In Texas, ozone is the
criteria pollutant of primary concern. States are primarily responsible
for ensuring attainment and maintenance of national ambient air quality
standards once EPA has established them. States submit state
implementation plans to EPA for approval that provide for the
attainment and maintenance of air quality standards. If the state fails
to submit this plan, submits an inadequate plan, or fails to implement
any requirement of the plan, the state could face ineligibility for
federal highway funding and may also lose authority to implement Clean
Air Act programs. Under the act, the plans include stricter pollution
control measures for areas not meeting the national ambient air quality
standards, known as nonattainment areas. Steps that states and local
governments are required to take under the act to control ozone
pollution in nonattainment areas can include strict emission controls
on new, modified, and existing industrial facilities; additional
planning requirements for transportation sources; and vehicle emissions
inspection programs.
Once EPA approves a plan, states are generally responsible for
implementing the New Source Review and Prevention of Significant
Deterioration provisions of the Clean Air Act. When new major sources
of air pollution, such as power plants, are proposed, they must undergo
New Source Review and, in areas that meet national air quality
standards, a Prevention of Significant Deterioration review. New Source
Review entails reviewing applications for the proposed power plants to
establish emission limits and ensure they utilize appropriate air
pollution control technologies. A Prevention of Significant
Deterioration review ensures that the emissions from the source will
not exceed maximum allowable increases for three of the criteria
pollutants--nitrogen dioxide, sulfur oxides, and particulate matter--
and that the source will not cause or contribute to a violation of the
national air quality standards. Additionally, states generally issue
permits for power plants under the Clean Air Act. In Texas, a
Prevention of Significant Deterioration permit is issued prior to
construction of a power plant and an operating permit shortly before it
begins operation.[Footnote 2] In this report, the term permit refers to
the Prevention of Significant Deterioration permit unless stated
otherwise.
We prepared this report in response to a congressional directive in the
Joint Explanatory Statement accompanying the Consolidated
Appropriations Act of 2008. This report provides information on (1) the
current status of permitting coal-burning, electricity-generating units
in Central Texas; (2) the process EPA and Texas use, under the Clean
Air Act, to review permit applications for proposed new major sources
of air pollution; and (3) what is known about air quality and
respiratory health in Central Texas.
To respond to these objectives, we interviewed officials from EPA and
the Texas Commission on Environmental Quality (TCEQ), the environmental
agency for Texas, regarding (1) the status of coal-burning, electricity-
generating units proposed to be built in Central Texas, (2) how the
state implements federal and state laws and regulations in its permit
application review process, and (3) air quality standards and
monitoring. We reviewed relevant laws, regulations, and policies on
federal and state permitting requirements for new major sources of air
pollution and federal requirements related to air quality standards and
monitoring. We also obtained and analyzed existing ambient air quality
data reported by TCEQ and mortality rates from the Texas Department of
State Health Services and the Centers for Disease Control and
Prevention's National Center for Health Statistics' National Vital
Statistics System, to determine current air quality and health
conditions in Central Texas. We assessed the reliability of these data
and determined that they were sufficiently reliable for the purposes of
this report. For the purposes of our review, we defined "Central Texas"
as the 20 Texas counties that fall within TCEQ Region 9--Bell, Bosque,
Brazos, Burleson, Coryell, Falls, Freestone, Grimes, Hamilton, Hill,
Lampasas, Leon, Limestone, Madison, McLennan, Milam, Mills, Robertson,
San Saba, and Washington counties. Because TCEQ is subject to ongoing
litigation related to some of the recently permitted coal-burning units
that fell under our review, we did not evaluate whether the permitting
actions taken by EPA or TCEQ comply with the Clean Air Act or other
relevant statutes, regulations, or guidance. We conducted our work from
October 2008 to August 2009 in accordance with all sections of GAO's
Quality Assurance Framework that are relevant to our objectives. The
framework requires that we plan and perform the engagement to obtain
sufficient and appropriate evidence to meet our stated objectives and
to discuss any limitations in our work. We believe that the information
and data obtained, and the analysis conducted, provide a reasonable
basis for any findings and conclusions in this product. Enclosure I
provides additional details on our objectives, scope, and methodology.
Summary:
Of the permit applications TCEQ has received in recent years for 10
coal-burning, electricity-generating units to be built in Central
Texas, applications for 5 have been withdrawn, and TCEQ has issued
draft or final permits for the remaining 5. Specifically, in February
2007, one energy company withdrew its simultaneously submitted permit
applications for four new coal-burning units in Central Texas after
facing opposition from environmental advocates, local government
officials, and some Central Texas residents. The following year, after
a change in ownership, a different energy company canceled plans to
build a coal-burning unit in Central Texas and withdrew its permit
application. Currently, TCEQ has issued either a draft or final permit
for five coal-burning units to be built in the region. Construction on
two of these units is near completion, and they are scheduled to begin
operations in late 2009. However, the five coal-burning units have
faced legal and administrative challenges from environmental advocates,
local government officials, and some Central Texas residents. These
challenges have generally claimed that TCEQ's approval of the draft or
final permits failed to comply with various Clean Air Act requirements.
While some of the administrative and legal challenges have been
settled, those that remain are in varying stages of resolution, and it
is unclear when they will be resolved.
When EPA approved Texas's state implementation plan--a plan for
attaining and maintaining national air quality standards--TCEQ became
responsible for reviewing all permit applications and issuing permits
for proposed new major sources of air pollution. An important component
of the permit application process is the applicant's analysis of the
proposed new source's likely effect on air quality. Specifically, for
most criteria pollutants, applicants determine if the new source's
emissions of those pollutants are likely to exceed EPA-established
thresholds. If the applicants determine that emissions are not likely
to exceed EPA thresholds, no further analysis is required. However, if
emissions are likely to exceed threshold levels, the applicant is
required to perform a more detailed analysis to assess the impact of
emissions from the new source, as well as the impact of emissions from,
for example, other sources located or being constructed nearby.
Regarding EPA's oversight of TCEQ's permitting procedures for new major
sources, EPA said that the agency reviews most applications and draft
permits and provides comments to TCEQ on most of them. According to
EPA, although it tries to resolve differences with TCEQ, the state
agency has at times issued permits with which EPA comments have
disagreed. If EPA's review of a draft permit reveals that the permit
does not comply with the Clean Air Act or the Texas state
implementation plan, EPA officials said that, generally, EPA must
utilize its authority under section 113 of the Clean Air Act to take an
enforcement action. Under this authority, EPA may issue an order to
stop construction of the new major source or can impose administrative
penalties. In addition, EPA expressed concerns to TCEQ about permit
application review problems that arose in 2006 when a company
simultaneously submitted applications for four coal-burning units to be
built in Central Texas. Specifically, EPA expressed a concern about the
cumulative impact of the emissions from these units and said the impact
on air quality from the new coal-burning units could not be accurately
determined. TCEQ said that permit applicants were not required to
perform an analysis to determine the cumulative impact of emissions
from these units and that routine EPA modeling practices were followed
for each of the applications.
Current data show Central Texas meets national air quality standards,
but mortality rates from respiratory illnesses are slightly higher for
the region than for the state or the nation. TCEQ operates an air
quality monitoring network throughout the state, with two monitors
currently in Central Texas that measure pollutant concentrations.
Current TCEQ data show that Central Texas meets national air quality
standards for all six criteria pollutants. However, ozone
concentrations in the region are close to exceeding a new national
ozone standard EPA issued in 2008. Research over the past 50 years has
consistently found that exposure to ozone is linked to the development
of respiratory illnesses such as asthma. Furthermore, recent studies
have provided strong evidence that respiratory health effects
associated with ozone--such as decreased lung function and premature
mortality--can occur at ozone concentrations below the current
standard. Regarding respiratory health in Central Texas, the most
recent data available from the Texas Department of State Health
Services and the National Center for Health Statistics show mortality
rates from most respiratory illnesses are slightly higher for Central
Texas than for the entire state of Texas or for the nation as a whole.
Specifically, the region has higher mortality rates from certain
chronic lower respiratory diseases, pneumonia and influenza, and lung
cancer. These agencies do not draw links between these mortality rates
and any specific cause of the respiratory illnesses.
Background:
In Texas, there are currently three ozone nonattainment areas based on
EPA's 1997 national ozone standard.[Footnote 3] Coal-burning,
electricity-generating units contribute to ozone formation by emitting
nitrogen dioxides, which, in the presence of sunlight, react with
manmade and naturally occurring volatile organic compounds to form
ozone.[Footnote 4] Moreover, ozone, as well as other pollutants, can be
transported to downwind areas many miles away. Many clinical studies
have shown that repeated exposure to ozone can lead to respiratory
illnesses, decreased lung function, and premature death. To provide
increased protection against these ozone-related adverse health
effects, EPA revised the national ozone standard in 2008 based upon the
evidence from over 1,700 scientific studies conducted since the 1997
national ozone standard was issued. In March 2009, the governor of
Texas listed seven areas in the state that were not meeting the new
2008 national ozone standard and recommended to EPA that these areas be
designated as ozone nonattainment areas by initially designating them
as nonattainment.[Footnote 5] EPA will consider the governor's
recommended initial designation and promulgate ozone nonattainment area
designations by March 2010. If EPA designates these areas as
nonattainment for ozone, the number of nonattainment areas in the state
will increase from three to seven, substantially expanding the number
of Texas residents living in areas where ozone levels exceed the
national standard.
The Number of Proposed Coal-Burning, Electricity-Generating Units in
Central Texas Has Declined from 10 to 5 in Recent Years:
Since 2002, TCEQ has received proposals for 10 coal-burning,
electricity-generating units to be built in Central Texas, but permit
applicants for 5 of these units have withdrawn their applications (see
figure 1 for the location of each proposed unit).
Figure 1: Locations of Coal-Burning Units Proposed in Central Texas
Since 2002:
[Refer to PDF for image: map of Central Texas]
Indicated on the map are the following:
Location of Central Texas area in relationship to entire state, with
location of coal burning units indicated;
Coal burning units, with permit status:
Permit application withdrawn:
Twin Oaks;
Big Brown;
Lake Creek;
Tradinghouse.
Draft permit issued:
Limestone;
Final permit issued:
Sandow;
Sandy Creek;
Oak Grove.
Sources: GAO; EPA; TCEQ; MapInfo (map); and Art Explosion (clip art).
Notes: The Oak Grove and Tradinghouse power plants each had two coal-
burning units included in their permit applications. Additionally, the
Sandow, Twin Oaks, Big Brown, and Limestone power plants included
existing coal-burning units prior to 2002.
[End of figure]
Specifically, from 2002 through 2006, one energy company proposed seven
new coal-burning units for Central Texas and submitted permit
applications for four of these units simultaneously. Environmental
advocates, local government officials, and some Central Texas residents
opposed the addition of these coal-burning units to Central Texas,
claiming that their emissions would cause the region to violate the
national ozone standard. In February 2007, a group of private equity
firms purchased the company that had proposed the seven new coal-
burning units. As part of the purchase, the company agreed to withdraw
the permit applications for the four coal-burning units that it had
submitted simultaneously.[Footnote 6] In exchange for the company
withdrawing these applications, two environmental groups agreed to drop
their opposition to the three Central Texas coal-burning units that the
company had proposed separately. In addition, from 2004 through 2006,
three other energy companies submitted permit applications to each
build one coal-burning unit in Central Texas. However, one of these
companies withdrew its application in 2008 after a change in ownership.
TCEQ has issued a draft or final permit for each of the remaining five
coal-burning units, although opposition to building these units
persists. Table 1 provides additional information on the 10 proposed
coal-burning units.
Table 1: Ten Coal-Burning Units Proposed in Central Texas Since 2002:
Coal-burning unit: Sandow[A];
Permit application date: November 2002;
Location: Milam County;
Permit status: Final permit issued;
Generation capacity (in megawatts): 564.
Coal-burning unit: Sandy Creek;
Permit application date: January 2004;
Location: McLennan County;
Permit status: Final permit issued;
Generation capacity (in megawatts): 800.
Coal-burning unit: Twin Oaks;
Permit application date: July 2005;
Location: Robertson County;
Permit status: Application withdrawn;
Generation capacity (in megawatts): 600.
Coal-burning unit: Oak Grove (first unit);
Permit application date: July 2005;
Location: Robertson County;
Permit status: Final permit issued;
Generation capacity (in megawatts): 800.
Coal-burning unit: Oak Grove (second unit);
Permit application date: July 2005;
Location: Robertson County;
Permit status: Final permit issued;
Generation capacity (in megawatts): 800.
Coal-burning unit: Big Brown;
Permit application date: April 2006;
Location: Freestone County;
Permit status: Application withdrawn;
Generation capacity (in megawatts): 860.
Coal-burning unit: Lake Creek;
Permit application date: April 2006;
Location: McLennan County;
Permit status: Application withdrawn;
Generation capacity (in megawatts): 860.
Coal-burning unit: Tradinghouse (first unit);
Permit application date: April 2006;
Location: McLennan County;
Permit status: Application withdrawn;
Generation capacity (in megawatts): 860.
Coal-burning unit: Tradinghouse (second unit);
Permit application date: April 2006;
Location: McLennan County;
Permit status: Application withdrawn;
Generation capacity (in megawatts): 860.
Coal-burning unit: Limestone;
Permit application date: June 2006;
Location: Limestone County;
Permit status: Draft permit issued;
Generation capacity (in megawatts): 800.
Sources: GAO and TCEQ.
[A] The Sandow unit is comprised of two coal-burning boilers connected
to one electricity generator. Although TCEQ regulates these two boilers
as two separate emission points, for the purposes of our report, we
refer to the Sandow coal-burning unit as one coal-burning, electricity-
generating unit.
[End of table]
The five coal-burning units with draft or final permits to be built in
Central Texas are in various stages of construction and litigation.
Construction is nearing completion on the Sandow unit and one of the
Oak Grove units, and these two units are anticipated to begin operating
by the end of 2009. The remaining two units with final permits are
currently under construction and will likely be operational within the
next few years, and construction has not begun on the Limestone unit,
which currently has a draft permit. The five coal-burning units have
faced administrative and legal challenges from environmental advocates,
local government officials, and some Central Texas residents. In
general, the challenges have claimed that TCEQ's approval of the
permits failed to comply with Clean Air Act requirements. These
administrative and legal challenges include the following:
* Sandow Unit 5. In 2001, a coalition of environmental and community
groups sued Sandow's operator for violating the Clean Air Act and Texas
state implementation plan by failing to obtain the necessary permits
and adopt the appropriate pollution control strategies. The lawsuit was
settled in 2003 by consent decree, and Sandow's operator has chosen to
comply with the consent decree, as modified in 2004 and 2007, by
building a new unit.
* Sandy Creek Unit 1. In August 2008, an environmental and consumer
group filed a complaint in federal district court against the owners of
the Sandy Creek power plant for failing to install appropriate
pollution control technology to limit mercury and other hazardous air
pollutants. The court held a hearing in early April 2009, but as of
June 2009, the court had not issued a ruling, and the case was still
pending.
* Oak Grove Units 1 and 2. As of June 2009, five lawsuits were pending
in state court alleging that TCEQ's approval of the permit application
violated Clean Air Act requirements, among other allegations.
* Limestone Unit 3. In February 2009, the Texas State Office of
Administrative Hearings held a contested case hearing over the draft
permit's limits on mercury emissions.[Footnote 7] TCEQ expects to
decide by the end of 2009 whether to issue the final permit.
Texas Reviews Permit Applications and Issues Permits for New Major
Sources of Air Pollution under EPA's Oversight:
When EPA approved Texas's state implementation plan--a plan for
attaining and maintaining national air quality standards--TCEQ became
responsible for reviewing permit applications and issuing permits for
proposed new major sources of air pollution. EPA retains oversight to
ensure TCEQ adheres to its state implementation plan permit procedures.
For example, senior EPA air program officials said they have reviewed
over 90 percent of Texas's new major source permit applications and
draft permits in the last 2 years to ensure TCEQ was properly
implementing Clean Air Act requirements and have provided written
comments to TCEQ on the majority of these actions.
According to TCEQ, when a new major source such as a power plant
submits a permit application to TCEQ, the agency reviews the
application to ensure it contains the required documentation,
determines the compliance history of the applicant, and then directs
the applicant to conduct public notice about the proposal with a 30-day
comment period. Once the agency completes this initial review, TCEQ
evaluates the application's content, which includes the applicant's
analysis of the proposed new major source's likely effect on air
quality in the area. If TCEQ approves the permit application, it
develops a draft permit for the source and issues a public notice about
the draft permit with another 30-day comment period.[Footnote 8] TCEQ
also sends the draft permit to EPA and members of the public who
previously commented on the permit application, as well as others.
According to both TCEQ and EPA, one of the most important components of
the permit application process for new major sources is the air quality
analysis that applicants prepare. TCEQ explained that the first step in
this analysis is for applicants to use air dispersion models to
determine if the new source's emissions are likely to exceed EPA-
established threshold levels for certain criteria pollutants.[Footnote
9] If these dispersion models demonstrate that emissions are not likely
to exceed these threshold levels, no further analysis is required.
[Footnote 10] However, if emissions are likely to exceed threshold
levels, the applicant is required to perform a more detailed analysis
to assess the impact of emissions from the new source, as well as the
impact of emissions from other sources located within approximately 50
kilometers (about 31 miles) from the new source.[Footnote 11]
Specifically, TCEQ requires applicants to consider emissions from the
new source, as well as from those sources that (1) already exist; (2)
are under construction; or (3) have a complete permit application but
have not yet received a permit. TCEQ officials said that this modeling
is in accordance with EPA guidance. According to both EPA and TCEQ
officials, there is no federal or Texas requirement for an air quality
analysis to consider new major sources whose permit applications are
not complete.
Regarding EPA's oversight of TCEQ's permitting procedures for new major
sources, EPA attempts to resolve any differences with TCEQ related to
EPA's review of these permit applications or draft permits before a
permit is issued. However, EPA said that there are occasions when TCEQ
has issued permits with which EPA's comments on either the application,
or draft permit, have disagreed. EPA explained that this situation can
occur when EPA's determinations and interpretations of the Texas state
implementation plan differ from TCEQ's. TCEQ may, however, issue a
final permit even if the differences are not fully resolved. If EPA's
review of a draft permit reveals that the permit does not comply with
the Clean Air Act or the Texas state implementation plan, EPA officials
said that, generally, EPA must utilize its authority under section 113
of the Clean Air Act to take an enforcement action. Under this
authority, EPA may issue an order to stop construction of the new major
source, impose administrative penalties, or bring a civil action
against the owner or operator of the facility.[Footnote 12] For
example, EPA may issue an administrative order against any person
assessing a civil administrative penalty of up to $25,000 per day for
violation of the Clean Air Act, under certain circumstances, after a
hearing on the record.[Footnote 13]
EPA expressed concerns to TCEQ about draft permit review problems in
November 2006 when a company simultaneously submitted applications for
four coal-burning units to be built in Central Texas. Specifically, EPA
expressed a concern about the cumulative impact of the emissions from
these units, especially on ozone levels, and recommended that TCEQ
perform a cumulative ozone impact analysis that would include all of
the proposed coal-burning units. In TCEQ's February 2007 response to
comments on draft permits, it stated that individual permit applicants
were not required under TCEQ rules to perform this analysis. EPA
officials told us that Prevention of Significant Deterioration
regulations do not require TCEQ or the applicant to conduct a
cumulative ozone impact analysis. However, EPA officials said that the
applicant must determine if other existing sources or proposed sources
are within the impact area to be modeled.[Footnote 14] If so, these
emissions must be included in the modeling required by the applicable
regulations. This modeling must demonstrate that the proposed source,
in conjunction with all other applicable emissions increases or
reductions, would not cause or contribute to air pollution in violation
of any national ambient air quality standard or maximum allowable
increase for certain pollutants. Therefore, if a series of new sources
within the same impact area submits a permit application, each
successive source must include the emissions from the sources who have
already filed a complete permit application in the air quality modeling
for its source.
According to EPA, it may make a recommendation that cumulative modeling
is easier and more convenient where (1) a significant number of
proposed new sources are in an area that is close to not meeting
national air quality standards (Central Texas) and (2) where proposed
new sources that will emit significant amounts of the precursors of
ozone are just outside of an ozone nonattainment area (Dallas/Fort
Worth), but it is only a recommendation.[Footnote 15] EPA officials
stated that they would, however, review each draft permit to ensure
that modeling included all existing and previously proposed sources in
the impact area. EPA further noted that, generally, under section
165(a) of the Clean Air Act, no major emitting facility may be
constructed unless the proposed permit has been subject to a review in
accordance with the applicable regulations and that it is TCEQ's
responsibility as the permitting authority to ensure, prior to granting
the permit, that potential impacts caused by an individual proposed
source will not cause or contribute to a violation of any applicable
national air quality standard, including ozone.
Additionally, when EPA commented on the draft permits in November 2006,
it said it had difficulty evaluating the air quality analyses of the
individual permit applications because TCEQ had deemed the applications
as complete at the same time and had not assigned a sequential order to
them. EPA explained that applicants generally submit permit
applications on separate days, and when that occurs, the sequence of
the applications and, therefore, the scope of the air modeling required
are clear. However, in this case, EPA stated that though the air
modeling for each of these four coal-burning units should have
accounted for the likely emissions from the others applying that day,
EPA was unable to determine if the modeling had accounted for those
emissions. As such, EPA said that the impact on air quality from these
new sources could not be accurately determined. According to TCEQ
officials, however, routine EPA modeling practices were followed for
each of the applications. The permit applications for these four units
were ultimately withdrawn by the company after it was purchased in
February 2007 by a group of private equity firms.
Central Texas Meets National Air Quality Standards, but Available Data
Show Slightly Higher Mortality Rates from Respiratory Illnesses in the
Region than in the State or Nation:
Current data from TCEQ's air quality monitoring network show Central
Texas meets national air quality standards for all six criteria
pollutants.[Footnote 16] However, monitoring data also show ozone
concentrations in the region are close to exceeding the new EPA 2008
national ozone standard. TCEQ operates an air quality monitoring
network of over 200 monitoring sites throughout the state. In Central
Texas, two air quality monitors currently measure pollutant
concentrations. One monitor, located near the city of Waco, measures
levels of carbon monoxide, nitrogen dioxide, sulfur oxides, particulate
matter, and ozone. This monitor began collecting data on pollution
levels in April 2007, when TCEQ established it to satisfy a request
from a member of the Texas legislature. The second monitor is located
in the city of Killeen, and it measures ozone levels. TCEQ established
this monitor in June 2009 to meet federal air quality monitoring
requirements.[Footnote 17] Because EPA's ozone nonattainment
designations are based on 3 complete years of data, the Waco air
quality monitor cannot be used in EPA's consideration of a
nonattainment designation for the region until April 2010, and the
Killeen monitor cannot be used until June 2012.[Footnote 18] However,
when TCEQ calculates current data from the Waco monitor for comparison
against the 2008 national ozone standard of 75 parts per billion, the
region's preliminary calculated ozone value, as of July 30, 2009, is 72
parts per billion.[Footnote 19] Furthermore, as figure 2 shows, Central
Texas is bordered by areas that EPA designated as nonattainment under
the 1997 national ozone standard and areas that the governor of Texas
recommended EPA designate as nonattainment under the new 2008 national
ozone standard.
Figure 2: Designated and Recommended Ozone Nonattainment Areas in
Texas:
[Refer to PDF for image: map of Texas]
The following information is depicted on the map:
Designated nonattainment areas under 1997 national ozone standard (20
counties):
* Dallas/Fort Worth area;
* Beaumont/Port Arthur area;
* Houston/Galveston/Brazoria area.
Recommended nonattainment areas under 2008 national ozone standard (27
counties):
* Dallas/Fort Worth area;
* Beaumont/Port Arthur area;
* Houston/Galveston/Brazoria area;
* Tyler area;
* Austin area;
* San Antonio area;
* El Paso area.
Sources: GAO; EPA; TCEQ; and MapInfo (map).
[End of figure]
When an area is classified as a nonattainment area for ozone, the state
must revise its state implementation plan to describe the measures the
state will implement so that the area will attain the national ozone
standard. If EPA finds that the state has failed to submit this plan
revision, submitted an inadequate plan, or failed to implement any
requirement of the plan, EPA makes a finding of inadequacy and
publishes a proposed rule calling for the imposition of sanctions on
the nonattainment area.[Footnote 20] After the proposed rule's notice
and comment period, EPA must impose an emission offset sanction or
federal highway funding sanction on the nonattainment area.[Footnote
21] For example, the highway funding sanctions allow EPA to impose a
prohibition on the Secretary of Transportation's approval of certain
projects or awarding certain grants applicable to the nonattainment
area. These sanctions could have adverse economic consequences for the
nonattainment area. In addition, the state's revised implementation
plan must list the pollution control measures the state will apply so
that the area will attain the national ozone standard. Examples of
these pollution control measures include requirements that the state
and local governments impose strict nitrogen dioxide and volatile
organic compound emission limits on new, modified, and existing sources
of these pollutants because they contribute to ozone formation.
According to TCEQ and EPA officials, the cost of meeting these emission
limits may discourage businesses from locating factories and other
industrial facilities in nonattainment areas. In fact, TCEQ said that
when one international company recently considered building a new
factory in Texas, the company avoided the Dallas/Fort Worth and Houston
areas because of the strict emission limits in those two ozone
nonattainment areas.
Research over the past 50 years has consistently found that exposure to
ozone is associated with adverse respiratory effects.[Footnote 22]
Epidemiological and human exposure studies conducted in the last
several years provide evidence of a robust association between ozone
exposure and decreased lung function, respiratory hospitalizations, and
premature mortality.[Footnote 23] These studies also found that
children, older adults, adults who are active outdoors, and those with
pre-existing lung conditions such as asthma, are more vulnerable to
these adverse health effects.[Footnote 24] Furthermore, recent studies
have provided strong evidence that respiratory health effects
associated with ozone occur at ozone concentrations below the current
standard. For instance, an EPA analysis of a 2006 study found
statistically significant lung function decrements in healthy adults
exposed to ozone levels of 60 parts per billion, and a 2006 multicity
study found the relationship between ozone concentration and mortality
could occur at concentrations far below the current standard.[Footnote
25]
Regarding respiratory health in Central Texas, the most recent data
available show mortality rates from most respiratory illnesses are
slightly higher for the region than for the entire state or the nation
as a whole. Specifically, the Texas Department of State Health Services
and the National Center for Health Statistics report mortality rates
from respiratory illnesses for 2001 through 2005 that are adjusted to
control for differences in the age distribution of the different
populations but not for other influences, such as rates of smoking and
socioeconomic levels.[Footnote 26] As figure 3 shows, Central Texas has
higher mortality rates than the entire state and the nation as a whole
from certain respiratory illnesses, but mortality rates from one type
of respiratory illness--other chronic obstructive pulmonary diseases--
were slightly lower for Central Texas than for the state and the
nation. The Texas Department of State Health Services and National
Center for Health Statistics data do not draw links between these
mortality rates and any specific contributing causes of the respiratory
illnesses.
Figure 3: 2001-2005 Mortality Rates from Respiratory Illnesses in
Central Texas, Texas, and the United States:
[Refer to PDF for image: multiple vertical bar graph]
Mortality rates per 100,000 population:
Cause of death: Lung, trachea, and bronchus cancers;
Central Texas: 62.9;
Texas: 53.1;
United States: 54.
Cause of death: Other chronic obstructive pulmonary diseases;
Central Texas: 34.2;
Texas: 36.6;
United States: 36.2.
Cause of death: Pneumonia and influenza;
Central Texas: 23.5;
Texas: 20.8;
United States: 21.3.
Cause of death: Emphysema;
Central Texas: 7.4;
Texas: 5.7;
United States: 5.1.
Cause of death: Asthma;
Central Texas: 1.5;
Texas: 1.3;
United States: 1.3.
Source: GAO analysis of Texas Department of State Health Services and
National Center for Health Statistics data.
[End of figure]
We provided relevant sections of this report to the Environmental
Protection Agency and the Texas Commission on Environmental Quality to
confirm the information they provided and incorporated their technical
comments, as appropriate. We are sending copies of this report to
appropriate congressional committees and other interested parties. In
addition, this report will be available at no charge on the GAO Web
site at [hyperlink, http://www.gao.gov].
If you or your staffs have any questions about this report, please
contact John Stephenson at (202) 512-3841 or stephensonj@gao.gov.
Contact points for our Offices of Congressional Relations and Public
Affairs may be found on the last page of this report. Key contributors
to this report include Michael Hix (Assistant Director), Heather
Chartier, Nancy Crothers, Philip Farah, Cindy Gilbert, Kristin Hughes,
Karen Keegan, Summer Lingard, Kirk Menard, and Jeanette Soares.
Signed by:
John Stephenson:
Director, Natural Resources and Environment:
Congressional Addressees:
The Honorable Dianne Feinstein:
Chairman:
The Honorable Lamar Alexander:
Ranking Member:
Subcommittee on Interior, Environment and Related Agencies:
Committee on Appropriations:
United States Senate:
The Honorable Norman D. Dicks:
Chairman:
The Honorable Michael K. Simpson:
Ranking Member:
Subcommittee on Interior, Environment and Related Agencies:
Committee on Appropriations:
House of Representatives:
The Honorable Chet Edwards:
House of Representatives:
[End of section]
Enclosure I: Objectives, Scope, and Methodology:
We prepared this report in response to a congressional directive in the
Joint Explanatory Statement accompanying the Consolidated
Appropriations Act of 2008. The objectives of this review were to
provide information on (1) the current status of permitting coal-
burning, electricity-generating units in Central Texas; (2) the process
the Environmental Protection Agency (EPA) and Texas use, under the
Clean Air Act, to review permit applications for proposed new major
sources of air pollution; and (3) what is known about air quality and
respiratory health in Central Texas.
To provide information on the current status of permitting coal-
burning, electricity-generating units in Central Texas, we interviewed
officials with EPA's Region 6 Multimedia Planning and Permitting
Division in Dallas, Texas, and the Texas Commission on Environmental
Quality's (TCEQ) Air Permits Division in Austin, Texas. The information
we obtained from these officials helped us identify coal-burning,
electricity-generating units proposed to be built in Central Texas and
describe the history and current status of those units. To gain a
better understanding of how coal-burning, electricity-generating units
work, we also visited a coal-fired power plant in Central Texas and
discussed with company officials how their coal plant operates. For the
purposes of our review, we defined "Central Texas" as the 20 Texas
counties that fall within TCEQ Region 9--Bell, Bosque, Brazos,
Burleson, Coryell, Falls, Freestone, Grimes, Hamilton, Hill, Lampasas,
Leon, Limestone, Madison, McLennan, Milam, Mills, Robertson, San Saba,
and Washington counties.
To provide information on the process EPA and TCEQ use to review permit
applications for proposed new major sources of air pollution under the
Clean Air Act, we reviewed relevant laws, regulations, and policies on
federal and state permitting requirements for new major sources of air
pollution. We also interviewed officials with EPA's Region 6 Multimedia
Planning and Permitting Division in Dallas, Texas, and TCEQ's Air
Permits Division, Monitoring Operations Division, and Chief Engineer's
Office, in Austin, Texas, to determine how the state implements federal
and state laws and regulations in its permit application review
process. TCEQ is subject to ongoing litigation related to some of the
recently permitted coal-burning, electricity-generating units that fell
under our review. GAO's policy is to avoid taking a position on or
addressing matters that are pending in litigation. Because of this
ongoing litigation, we did not evaluate whether the permitting actions
taken by EPA or TCEQ comply with the Clean Air Act or other relevant
statutes, regulations, or guidance. Specifically, we did not assess any
permit applications, the quality of any air modeling conducted by an
applicant, or the quality of the data used to conduct an air modeling
analysis due to ongoing litigation.
To provide information on air quality and respiratory health in Central
Texas, we reviewed federal requirements related to air quality
standards and monitoring and interviewed EPA and TCEQ officials about
these issues. Additionally, we obtained and analyzed existing ambient
air quality data reported by TCEQ's Monitoring Operations Division to
determine current air quality conditions in Central Texas. To assess
respiratory health conditions in the region, we obtained and analyzed
mortality data reported by the Texas Department of State Health
Services and the Centers for Disease Control and Prevention's National
Center for Health Statistics' National Vital Statistics System. To
assess the reliability of the air monitoring data we obtained from TCEQ
and the mortality data we obtained from the Texas Department of State
Health Services and the National Center for Health Statistics, we
interviewed agency officials about data quality control procedures and
reviewed relevant documentation. We determined that the data were
sufficiently reliable for the purposes of this report.
We conducted our work from October 2008 to August 2009 in accordance
with all sections of GAO's Quality Assurance Framework that are
relevant to our objectives. The framework requires that we plan and
perform the engagement to obtain sufficient and appropriate evidence to
meet our stated objectives and to discuss any limitations in our work.
We believe that the information and data obtained, and the analysis
conducted, provide a reasonable basis for any findings and conclusions
in this product.
[End of section]
Footnotes:
[1] A power plant can have more than one coal-burning unit.
[2] Known as a Title V operating permit, this permit contains all
existing federal Clean Air Act requirements, including the provisions
of the Prevention of Significant Deterioration permit, applicable to
the power plant.
[3] The areas in Texas currently classified as ozone nonattainment
areas are (1) Dallas/Fort Worth (nine counties); (2) Houston/Galveston/
Brazoria (eight counties); and (3) Beaumont/Port Arthur (three
counties).
[4] Burning coal to produce energy also emits carbon dioxide--a
greenhouse gas--into the atmosphere.
[5] The areas recommended to be designated as nonattainment for the new
2008 national ozone standard are the existing nonattainment areas
identified in footnote 3 and (1) Austin (one county); (2) El Paso (one
county); (3) San Antonio (one county); and (4) Tyler (three counties).
Also, it was recommended that one county be added in the Dallas/Fort
Worth area. None of the areas recommended as nonattainment for the 2008
national ozone standard is within the region we refer to in this report
as Central Texas.
[6] The permit applications for these four units were withdrawn in
September 2008.
[7] A contested case hearing is a proceeding in which the legal rights,
duties, or privileges of a party are to be determined by a state agency
after an opportunity for adjudicative hearing.
[8] During this public comment period and the public comment period
following TCEQ's receipt of the permit application, certain members of
the public and others may ask for a contested case hearing and/or a
public meeting on the permit application or draft permit. Any member of
the public may submit a comment to TCEQ on the permit application or
draft permit during their respective comment periods.
[9] Because ozone forms in the atmosphere and is not emitted directly,
there is no EPA-established threshold of ozone emissions. Instead,
emission levels of the precursors of ozone--nitrogen dioxide and
volatile organic compounds--are considered.
[10] As previously noted, TCEQ evaluates the content of a permit
application, including the applicant's analysis of the proposed new
major source's likely effect on air quality in the area. Dispersion
models project the impact of the proposed source's emissions on recent
existing air quality levels and other proposed sources, based on air
quality and weather monitoring data, emission inventory data of
surrounding sources, the technical specifications of the new sources,
and the topography of the surrounding landscape, among other factors.
The results of modeling depend on such variables as data inputs and the
design of the model.
[11] According to EPA, 50 kilometers is the useful distance to which
most steady-state Gaussian plume models are considered accurate for
setting emission limits. The traditional stationary source models
recommended in EPA's Guideline on Air Quality Models (40 C.F.R. Part
51, Appx. W) are the models generally used in the air quality impact
analysis of stationary sources for most criteria pollutants. TCEQ
officials said that available air dispersion modeling techniques used
for permitting purposes generally provide accurate modeling estimates
up to 50 kilometers from the source being modeled. Although EPA
recognized the need to estimate impacts at distances greater than 50
kilometers, its guidelines state that long range transport models are
limited for regulatory use to a case-by-case basis.
[12] When EPA's review of a draft operating permit reveals that it is
not in compliance with the Clean Air Act or the state implementation
plan, EPA must object to the permit. TCEQ is then required to revise
the draft permit in response to the objection. If TCEQ fails to do so,
EPA must assume responsibility for determining whether to issue or deny
the draft operating permit.
[13] However, EPA's authority to impose administrative assessments of
civil penalties is limited to matters where the total penalty sought
does not exceed $200,000 and the first alleged date of the violation
occurred no more than 12 months prior to the administrative action,
except when the EPA Administrator and Attorney General agree that a
larger penalty or longer period can be appropriately addressed by an
administrative penalty.
[14] According to EPA guidance, the impact area is a circular area with
a radius of approximately 50 kilometers (about 31 miles) extending from
the proposed source.
[15] As previously noted, the precursors of ozone are nitrogen dioxide
and volatile organic compounds.
[16] TCEQ uses emissions data to monitor lead concentrations throughout
most of the state. According to TCEQ, ambient air quality in Central
Texas meets the 1978 national air quality standard for lead.
[17] TCEQ establishes air quality monitors in accordance with design
requirements contained in Appx. D to 40 C.F.R. Part 58. For ozone, the
various monitor locations depend upon area size (in terms of population
and geographic characteristics) and typical peak concentrations
(expressed in percentages below, or near, the ozone national ambient
air quality standard).
[18] EPA makes attainment and nonattainment designations based on a
statistic, known as a design value, which EPA compares to the national
air quality standard. For the national ozone standard, the design value
is the 3-year average of the annual fourth-highest daily maximum 8-hour
average ozone concentration. The 2008 national ozone standard is 0.075
parts of ozone for 1 million parts of air, (or 75 parts of ozone for 1
billion parts of air). Areas with a design value above this amount have
failed to meet the standard.
[19] The preliminary calculated ozone design value of 72 parts per
billion includes data from April 20, 2007, through July 30, 2009. When
3 complete years of data from the Waco monitor are available in April
2010, the calculated ozone design value will likely be different
because it will include monitored ozone levels from the entire summer
of 2009. (Ozone levels are typically highest during the summer.)
[20] Some of the inadequacy findings, such as a failure to implement,
must be made through a separate rulemaking.
[21] The emission offset sanction requires a ratio of at least 2 to 1
for emissions reductions from existing sources of pollution within the
nonattainment area to offset emissions from major new or modified
facilities. In other words, a company that is constructing or modifying
a facility over a certain size is required to reduce emissions in the
nonattainment area by 2 tons for every new ton the new or modified
facility will emit. The offset requirement refers to reductions in
emissions that major new and modified sources must get from existing
sources before they may begin construction.
[22] We refer to several epidemiological and human exposure studies
under this section that are found in 72 Fed. Reg. 37818 (July 11, 2007)
(the proposed rule for the national ambient air quality standards for
ozone) or the criteria document that EPA's Office of Research and
Development developed to critically evaluate the latest scientific
information on the health and welfare effects of ozone. EPA used these
studies, along with many others cited in these documents, to support
its decision to revise the national ozone standard in 2008. We did not
assess the methodological soundness of the studies or the analysis
referred to in our report.
[23] These studies include: W. F. McDonnell et al., "Ozone-induced
respiratory symptoms: exposure-response models and association with
lung function," European Respiratory Journal, vol. 14 (1999); R. T.
Burnett et al., "Association between ozone and hospitalization for
respiratory diseases in 16 Canadian cities," Environmental Research,
vol. 72 (1997); M. L. Bell et al., "Ozone and short-term mortality in
95 US urban communities, 1987-2000," Journal of the American Medical
Association, vol. 292 (2004).
[24] These studies include: P. Höppe et al., "Environmental ozone
effects in different population subgroups," International Journal of
Hygiene and Environmental Health, vol. 206 (2003); N. Gouveia and T.
Fletcher, "Time series analysis of air pollution and mortality: effects
by cause, age and socioeconomic status," Journal of Epidemiology and
Community Health, vol. 54 (2000); S.A. Korrick et al., "Effects of
ozone and other pollutants on the pulmonary function of adult hikers,"
Environmental Health Perspectives, vol. 106 (1998).
[25] See J.S. Brown, "The effects of ozone on lung function at 0.06
[parts per million] in healthy adults," Memo to the Ozone NAAQS, OAR-
2005-0172 (2007); W.C. Adams, "Comparison of chamber 6.6 hour exposures
to 0.04--0.08 ppm ozone via square-wave and triangular profiles on
pulmonary responses," Inhalation Toxicology, vol. 15 (2006); and M.L.
Bell, et al., "The exposure-response curve for ozone and risk of
mortality and the adequacy of current ozone regulations," Environmental
Health Perspectives, vol. 114 (2006).
[26] The mortality rates are per 100,000 population, and the standard
used for age adjustment is the U.S. 2000 standard population.
[End of section]
GAO's Mission:
The Government Accountability Office, the audit, evaluation and
investigative arm of Congress, exists to support Congress in meeting
its constitutional responsibilities and to help improve the performance
and accountability of the federal government for the American people.
GAO examines the use of public funds; evaluates federal programs and
policies; and provides analyses, recommendations, and other assistance
to help Congress make informed oversight, policy, and funding
decisions. GAO's commitment to good government is reflected in its core
values of accountability, integrity, and reliability.
Obtaining Copies of GAO Reports and Testimony:
The fastest and easiest way to obtain copies of GAO documents at no
cost is through GAO's Web site [hyperlink, http://www.gao.gov]. Each
weekday, GAO posts newly released reports, testimony, and
correspondence on its Web site. To have GAO e-mail you a list of newly
posted products every afternoon, go to [hyperlink, http://www.gao.gov]
and select "E-mail Updates."
Order by Phone:
The price of each GAO publication reflects GAO‘s actual cost of
production and distribution and depends on the number of pages in the
publication and whether the publication is printed in color or black and
white. Pricing and ordering information is posted on GAO‘s Web site,
[hyperlink, http://www.gao.gov/ordering.htm].
Place orders by calling (202) 512-6000, toll free (866) 801-7077, or
TDD (202) 512-2537.
Orders may be paid for using American Express, Discover Card,
MasterCard, Visa, check, or money order. Call for additional
information.
To Report Fraud, Waste, and Abuse in Federal Programs:
Contact:
Web site: [hyperlink, http://www.gao.gov/fraudnet/fraudnet.htm]:
E-mail: fraudnet@gao.gov:
Automated answering system: (800) 424-5454 or (202) 512-7470:
Congressional Relations:
Ralph Dawn, Managing Director, dawnr@gao.gov:
(202) 512-4400:
U.S. Government Accountability Office:
441 G Street NW, Room 7125:
Washington, D.C. 20548:
Public Affairs:
Chuck Young, Managing Director, youngc1@gao.gov:
(202) 512-4800:
U.S. Government Accountability Office:
441 G Street NW, Room 7149:
Washington, D.C. 20548:
