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September 10, 2012
Canada issues GHG regs for power plants

Proclaiming that Canada already possesses one of the cleanest electricity systems in the world, Environment Canada announced that the nation would now go to the next level by regulating greenhouse gas (GHG) emissions from coal-fired power plants. 
The main components of the new regulations include a 50-year end-of-useful-life definition for existing power plants, with certain exceptions.  Once a plant reaches the end of its useful life, it would be required to meet a performance standard of 420 tons of CO2 emitted for each GWh of electricity produced.  New units, or those that start producing electricity commercially on or after July 1, 2015, will also be required to meet the performance standard, which Environment Canada states is the level of control that can be achieved by natural gas combined cycle technology. 
Energy supplied vs. emissions
According to Environment Canada, by 2020, the rules are expected to lower GHG emissions to 41 million tons below 2005 levels, a 33 percent reduction over this period. 
Canada has about 50 coal-fired power stations that supply 15 percent of the country’s power while generating 77 percent of GHG emissions from the electricity sector and about 11 percent of the country’s total releases of GHGs.  
CCS exemption
The regulations also:  

  • Allow any new unit or end-of-life unit that incorporates carbon capture and storage (CCS) to apply for an exemption from the performance standard until 2025. 
  • Provide that units commissioned before 1975 will reach their end of life after 50 years of operation or at the end of 2019, whichever comes earlier.
  • Provide that units commissioned in or after 1975 but before 1986 will reach their end of life after 50 years of operation or at the end of 2029, whichever comes earlier.

Provincial equivalency
The regulations also provide for equivalency agreements with Canada’s provinces.  Under such agreements, the federal regulations are replaceable by an enforceable provincial regime that delivers an equivalent environmental outcome.  Environment Canada says an equivalency agreement has already been reached with Nova Scotia, work is progressing on an equivalency agreement with Saskatchewan, and discussions on equivalency have also begun with Alberta.
As a result of the regulations, Environment Canada expects the first plant closures to occur in 2020; however, earlier closures are possible due to provincial actions and company plans.  The agency adds that the rules were developed to complement the normal replacement of aging coal-fired generating units; thus, there should be no risk that the supply of energy will be compromised.  The rules will produce about $7.3 billion in benefits, says Environment Canada, including health problems avoided because of reductions in smog-producing air pollutants. 
The final regulations are at http://www.ec.gc.ca/Content/4/D/3/4D34AE9B-1768-415D-A546-8CCF09010A23/GHG%20Coal-Regulations%20%28non-official%29.pdf.

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