A dynamic economic model for selecting environmental control technologies

The environmental protection agency (EPA) will be enforcing the NOx state implementation plan (SIP) call beginning in June 2004. Twenty-one states plus Washington DC are included in the program that will limit emissions during the ozone season. Coal-fired power plants, which emit most of the NOx in this region, are heavily impacted by these new restrictions. Power markets within the eastern interconnect will be affected by emission regulations, with the extent determined by compliance strategies chosen by plant owners. This paper presents a modeling methodology based on economic principles and power market rules to help coal-fired generation owners develop a NOx emission reduction strategy to comply with the SIP call. Applying the model suggests that burner modifications and selective non-catalytic reduction (SNCR) additions should be significant contributors to achieving regional compliance. Over 100 GW of installed coal capacity is determined to benefit from the addition of NOx controls. Additional selective catalytic reductions (SCR) constitute less than 1% of these modifications.