The EPA's Good Neighbor Rule

Click here to download a fact sheet with talking points supporting the EPA's Transport Rule, also known as the Good Neighbor Rule.

What is the Good Neighbor Rule?

Coal-fired power plants dump millions of tons of pollution into the air. That pollution spreads from state to state, giving kids asthma, causing heart attacks, and sending thousands of people to the hospital, but the states need federal help to control pollutions blowing in across their borders. Now, EPA is acting to help states be good neighbors with a rule that will systematically and efficiently cut pollution from dozens of coal plants that would otherwise spread across the country. This ‘Good Neighbor’ rule will step down pollution in thirty-one states, save lives, and help everyone breathe easier. Better yet, the rule’s benefits outweigh its costs – by over 100 billion dollars.
The Clean Air Act’s Good Neighbor” provision (section 110(a)(2)(D)(i)(I)) gives EPA the power to cut down interstate pollution that interferes with the attainment and maintenance of the national ambient air quality standards protecting public health. EPA is using that power in this new rule, which is officially called the Air Pollution Transport Rule, to remedy ongoing violations of the 1997 ozone standards, and the 1997 and 2007 fine-particle (PM2.5) standards. Ozone and fine particles aggravate asthma and cause heart and lung problems. EPA will use the rule to cut pollutants, sulfur dioxide (SO2) and nitrogen oxide (NOx) that pour out of smokestacks and form ozone and fine particles in the atmosphere. The Good Neighbor Rule replaces and strengthens EPA’s earlier Clean Air Interstate Rule (CAIR), which industry over-turned, but which remains in place pending EPA’s efforts to develop an updated rule.
What Will the Good Neighbor Rule Achieve?
EPA projects that without the Good Neighbor Rule, air pollution from power plants would result in 14,000 to 36,000 additional deaths. The Good Neighbor Rule will further prevent 23,000 non-fatal heart attacks, 26,000 hospital and emergency department visits, 21,000 cases of acute bronchitis, 240,000 episodes of aggravated asthma. EPA translates those benefits into a value of $110 to $270 billion. It estimates the costs of implementing the Rule at $6.5 billion.
Who Benefits From the Good Neighbor Rule Apply?
The Good Neighbor Rule will help clean the air in thirty-one states (Texas, Oklahoma, Kansas, Nebraska, Louisiana, Arkansas, Missouri, Iowa, Minnesota, Wisconsin, Illinois, Indiana, Ohio, Michigan, Mississippi, Alabama, Florida, Georgia, North Carolina, South Carolina, Tennessee, Kentucky, Virginia, West Virginia, Maryland, Delaware, Pennsylvania, New Jersey, New York, Massachusetts, and Connecticut) and the District of Columbia. It requires power plants in those areas to reduce their sulfur dioxide (SO2) and nitrogen oxides (NOx) emissions. EPA has concluded that reducing pollution from such plants is the most cost-effective means by which to protect air quality in neighboring states.
How Does the Good Neighbor Rule Work?
EPA’s proposed rule would mandate state-by-state SO2 and NOx reductions, with limited trading between states. EPA has established SO2 and NOx budgets for each affected state, designed to eliminate each state’s “significant contribution” to the violation of air-quality standards elsewhere. Of course, reducing pollution at the source will benefit people living near power plants, too. Reductions are achieved by ratcheting down the state budgets over time.
Power-plants within each affected state are required to maintain “allowances” – tradable pollution credits – for each ton of SO2 and NOx they emit each year. The state-wide budget determines the total allowances within the state. Individual plants would, under EPA’s proposal, receive a portion of those allowances based on their past emissions. Plants have the option of either reducing their pollution, or purchasing allowances from other plants which have reduced their pollution sufficiently to possess excess allowances. EPA currently plans to allow a limited number of allowances to move between states; most of the trading, however, will be in-state.
The first set of pollution reductions will occur in 2012. In fifteen states, deemed by EPA to be making the greatest contribution to PM2.5 violations in neighboring states, a second round of SO2 reductions will occur in 2014. Those “Tier 1” states are: Georgia, Illinois, Indiana, Iowa, Kentucky, Michigan, Missouri, New York, North Carolina, Ohio, Pennsylvania, Tennessee, Virginia, West Virginia, and Wisconsin. EPA has suggested that further reductions may be imposed to address recent and upcoming revisions to the Act’s national ambient air quality standards.
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