Highlights:

• Issued: July 7, 2011
• Compliance: Two phases occurring in 2012 and 2014
• Currenet Status: Stay ordered December 2011
• Previously known as: Clean Air Transport Rule

The Cross-State Air Pollution Rule (CSAPR) previously was known as the Clean Air Transport Rule. It replaces the U.S. Environmental Protection Agency's (EPA) 2005 Clean Air Interstate Rule (CAIR). A December 2008 Court decision remanded CAIR back to EPA and directed the agency to issue a new rule that would correct the problems identified by the Court. CAIR's requirements have remained in effect in the interim.

In December 2011, the DC Circuit Court of Appeals issued an order staying CSAPR pending decision on the merits of various appeals and petitions filed. The Court also ordered an expedited briefing schedule to hear the case by April 2012. EPA will continue to administer the CAIR pending resolution of the issues. The stay does not include the CSPAR Supplemental Rule.

What - CSAPR reduces emissions of annual sulfur dioxide (SO2) and nitrogen oxide (NOx) and seasonal NOx from electric generating facilities. EPA plans to reduce NOx emissions 54 percent from 2005 levels and to lower SO2 emissions 73 percent from 2005 levels by 2014.

According to EPA, the rule will improve air quality by reducing SO2 and NOx emissions that contribute to pollution in other states. EPA says that reducing emissions from the identified states will result in downwind states being able to eliminate areas currently in nonattainment with the national ambient air quality standards for: 1) the 24-hour PM2.5 (particulates) standards established in 2006, 2) the annual PM2.5 standards established in 1997 and 3) the 1997 ground-level ozone standard.

How - EPA established emission budgets for NOx and SO2 for each of the states covered by the rule. This approach requires each state to meet its emissions budget and allows limited interstate trading among power plants within "groups" established by the rule, starting in 2012.

EPA anticipates that power plants could meet the reduction requirements by:

• Operating already-installed control equipment more frequently,
• Burning low-sulfur coal or
• Installing new control equipment.

Who - The CSAPR applies to 28 states and the District of Columbia. This includes all states in which AEP operates power generating facilities. All AEP states would be required to reduce NOx emissions during the ozone season. And all AEP states except Arkansas, Oklahoma and Louisiana would be required to reduce both annual SO2 and NOx emissions. CSAPR requirements for Oklahoma and five other states were finalized under a separate Supplemental Rule.

When - EPA established deadlines for meeting emission budgets in two stages. Initial allocations for annual NOx and SO2 are applicable starting Jan. 1, 2012, with more stringent allocation budgets applicable starting Jan. 1, 2014.

At the same time, EPA has proposed or finalized other rules that will significantly impact coal-fired electricity generators and their customers. These include the Mercury and Air Toxics Standard (MATS), finalized in December 2011 with compliance required in early 2015; and the Coal Combustion Residuals rule and the Clean Water Act Section 316(b) requirements, both expected to be finalized in mid 2012.