Coal Combustion Residuals: Understanding the Final Rule and Next Steps for Electric Utilities

• • November 2015

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EPA Publishes Its Long-Awaited Final CCR Rule

• • EPA publishes its long-awaited final Coal Combustion Residuals (CCR) rule, but spares CCRs hazardous treatment Originally proposed in July 2010 and previewed in December 2014, EPA formally published its final CCR rule in April 2015 The rule regulates the disposal of CCRs from active electric generating units as nonhazardous waste under Subtitle D of the Resource Conversation and Recovery Act. The rule becomes effective October 14, 2015 Hazardous waste classification would have increased costs by an estimated $10B to $15B per year The final rule establishes minimal national criteria for CCR landfills and CCR surface impoundments. Sites must retrofit or close if they fail to meet criteria established by the new rule. Specific criteria include: Location restrictions Structural integrity requirements Liner design criteria Groundwater monitoring and corrective action requirements Operating criteria (e.g., fugitive dust) Closure and post-closure care requirements Recording, notification, and internet posting requirements
  • Background

• In order to comply, owners and operators will need to: Develop a formal compliance strategy and execute plans to meet requirements by the EPA deadlines in a way that adequately demonstrates compliance Establish organizational infrastructure to govern and oversee ongoing compliance responsibilities, thereby fixing the lack of organizational oversight that led to the current situation and need for EPA rule

 

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Develop Compliance Strategy and Organizational Capabilities

• • Develop an effective CCR compliance strategy: quickly fix the problem and/or demonstrate compliance A CCR compliance strategy should use the following process to develop a compliance strategy (see figure to the right) The compliance strategy should result in a master strategy for each site that: Identifies all planned activities to address long-term ash handling and storage requirements Identifies key coal combustion product activities and associated timing, anticipated ash production levels based on the generation plan, facility capacity limits, and amounts planned for marketing Provides an effective communication tool for plant-level strategy at a glance and a mechanism for issue and/or gap identification in planned project dates
  • Develop organizational infrastructure: fix the underlying gaps in oversight that could lead to problems down the road In addition to a compliance strategy, organizational capabilities must be developed to ensure effective, ongoing oversight by using the following steps:
  • Overview

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Approach for Integrated Plan Creation

• Created in parallel with the analysis and decision process to facilitate robust plan creation Provides a clear understanding of what work has to be completed and when Identifies dependencies between actions to improve project management Enables more effective control of spend Capital O&M

• Reports the status of progress on the overall project to internal and external stakeholders Identifies key risks and hurdles to the success of the project KPI-based reporting format: On-going risk Factor of safety High hazard Limited CCP capacity Master plan Milestones achieved Work-off curve Planned and upcoming action items
• Establishes current state as basis for planning Future state vision based on the resolution of critical assumptions and risks Replaces current working assumptions with validated plans and actions
• In Focus: Developing an Effective Compliance Strategy
• Current State and Overall Long-Term Strategy
• Detailed Integration Plan
• Reporting
• Preliminary High-Level Plan
• Identifies current assumptions and risks in the plan for analysis and validation Illustrates the current state picture site-by-site and company-wide Develops initial critical-path list for integrated plan creation

 

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Overview of Master Strategies Document

• • Potential Improvements CCP Streams (charcoal circles) Type Amount produced Generation Considerations (assumptions) Unit shutdowns CCP mixture (e.g., % ash and % gypsum from scrubber) Marketing Plans (green boxes) Annual amount Disposal Plans (yellow and orange boxes) Disposal facility type (e.g., pond, dry stack, landfill) Capacity of disposal site (FY) Closure date of facility Future Clean Air Plans (2015 installations) Scrubbers Coal Mix
  • Potential Improvements Developed for each plant to identify all planned activities related to addressing long-term ash handling and storage requirements Identifies key CCP activities and associated timing, anticipated ash production levels based on the generation plan, facility capacity limits, and marketing plan amounts Effective communication tool for the plant-level strategy at a glance and a mechanism for issue and/or gap identification in planned project dates Must be maintained and aligned with capital plan and project schedules
  • In Focus: Developing an Effective Compliance Strategy (Contd)

• Schematic View of the Overall Plan for Each Site(Including Disposition Strategy and High-Level Timing)

 

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CCR Expertise

• • ScottMadden Capabilities

• COAL COMBUSTION RESIDUALS
• Large Federal Utility Coal Combustion Product Remediation ScottMadden supported a progress assessment of the coal combustion product (CCP) remediation efforts being performed by a large federal utility focused on converting all coal generation ash ponds from wet- to dry-storage facilities. ScottMaddens focus included identifying critical tasks associated with all CCP projects and defining high-level CCP strategies for all fossil sites. ScottMadden also assisted with the identification and integration of cross-team dependencies (e.g., environmental operations and maintenance, capital projects group, etc.)Large Investor-Owned Utility Coal Combustion Product Change Management Support ScottMadden assisted a large investor-owned utility build a CCP department by developing a comprehensive training plan and implementation plan. The plan was designed to ensure that training materials, venues, and schedules ensured that personnel were trained prior to assumption of operational control. The training plan was role based and customized to the specific positions in the organization. In addition, ScottMadden developed an implementation plan for training activities and communications.