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EPA and Texas Railroad Commission Sign Memorandum of Agreement for Permitting Geologic Storage of Carbon Dioxide

LCG, April 29, 2025--Officials from the U.S. Environmental Protection Agency (EPA) and Texas Railroad Commission (RRC) signed a memorandum of agreement (MOA) today outlining the state’s plans to administer programs related to carbon storage wells, known as Class VI wells. The MOA signing is a required step in the RRC’s application to be granted authority to permit Class VI wells in the state of Texas. EPA is currently preparing a proposed approval of RRC’s primacy application.

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Calpine and ExxonMobil Sign CO2 Transportation and Storage Agreement for CCS Project in Texas

LCG, April 24, 2025--Exxon Mobil Corporation (ExxonMobil) announced yesterday an agreement with Calpine Corporation (Calpine) to transport and permanently store up to 2 million metric tons per annum (MTA) of CO2 from Calpine’s Baytown Energy Center, a natural gas-fired facility located near Houston, Texas. This is part of Calpine’s Baytown Carbon Capture and Storage (CCS) Project that is designed to add CCS for the facility’s CO2 emissions. The Calpine facility could then provide a 24/7 supply of low-carbon electricity to the Texas grid plus steam to nearby industrial facilities.

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Industry News

EPA Issues Mercury and Air Toxics Standards

LCG, December 22, 2011--The U.S. Environmental Protection Agency (EPA) yesterday issued the Mercury and Air Toxics Standards (MATS) that the EPA states will protect American families from power plant emissions of mercury and toxic air pollution like arsenic, acid gas, nickel, selenium, and cyanide.

EPA Administrator Lisa P. Jackson stated, "By cutting emissions that are linked to developmental disorders and respiratory illnesses like asthma, these standards represent a major victory for clean air and public health and especially for the health of our children. With these standards that were two decades in the making, EPA is rounding out a year of incredible progress on clean air in America with another action that will benefit the American people for years to come. The Mercury and Air Toxics Standards will protect millions of families and children from harmful and costly air pollution and provide the American people with health benefits that far outweigh the costs of compliance."

The EPA estimates that manufacturing, engineering, installing and maintaining the pollution controls to meet these new standards will provide employment for thousands, potentially including 46,000 short-term construction jobs and 8,000 long-term utility jobs. EPA further estimates that for every dollar spent to reduce pollution from power plants, the American public will see up to $9 in health benefits. The total health and economic benefits of this standard are estimated to be as much as $90 billion annually.

The MATS rule is also known as the Hazardous Air Pollutants rule for utilities and the Utility Maximum Available Control Technology (MACT) rule.

In response to the EPA's new rule, the President of the Edison Electric Institute (EEI) stated, "EPA's MACT rule is the most expensive rule in the agency's history. It will require a significant number of electric generating units to design, obtain approval for and install complex controls or replacements in a very short timeframe. In some cases, it will mean that new transmission and natural gas pipelines will have to be built.... EPA has made useful technical changes from its original proposal. Nevertheless, we believe the Administration is underestimating the complexity of implementing this rule in such a short period of time, which can create reliability challenges and even higher costs to customers. The Administration is not using all the available authorities in the Clean Air Act to coordinate implementation, to ensure electric reliability, and to avoid excessive costs."

In a recent technical conference, the Midwest Independent Transmission System Operator, Inc. ("MISO") Vice President of Transmission Asset Management warned the Federal Energy Regulatory Commission (FERC) that the proposed EPA rules pose threats to power reliability, as the rules will require simultaneous generator outages that may jeopardize electric reliability in the Midwest.

The concerns of the MISO focus on the 2014/2015 compliance deadline for the EPA's proposed mercury rule, which provides limited time for the installation of new emission control equipment or capacity replacement. To comply, generation owners must remove units from service simultaneously, which will provide inadequate generation resources to sustain reliable electricity supply. "As a result, 62,000 MW of coal units could potentially be unavailable for reliability purposes - all at the same time."
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