Background
While coal is the least expensive and most abundant fuel source for power generation, its combustion produces four primary air pollutants of concern for public health and the environment: sulfur dioxide (SO2), nitrogen oxide (NOX), mercury (Hg) and particulate matter (PM).

Existing Regulations
In 1970, the Clean Air Act authorized the U.S. Environmental Protection Agency (EPA) to establish National Ambient Air Quality Standards (NAAQS) to protect public health and the environment.  Since then, the Act has been amended twice, once in 1977 primarily to set new goals for attainment of NAAQS and then again in 1990 to address additional air quality problems, including acid rain, ground-level ozone, stratospheric ozone depletion, and toxic air pollution. 

The Clean Air Act Amendments (CAAA) of 1990 are the source of many existing regulations that limit emissions from coal-fired power plants.  In particular, the Acid Rain Program, established under Title IV of the 1990 Clean Air Act Amendments (CAAA), requires major reductions of SO2 and NOx emissions in two phases.  While the NOx program set emission rates based on boiler type, the SO2 program established a nationwide cap-and-trade program.  The NOx limits were largely met through installation of combustion modifications, while fuel switching to lower sulfur fuels and installation of FGD systems (also referred to as scrubbers) were used to comply with the SO2 limits.  As the nationwide SO2 cap is reduced in 2010 as specified in the CAAA, additional SO2 control equipment will be needed for continued compliance.

In addition to the Acid Rain Program, the CAAA created an Ozone Transport Commission to study NOx control in regions of the country with high concentrations of ground-level ozone.  Subsequent to the study, the U.S. Environmental Protection Agency (EPA) proposed and finalized the NOx SIP Call rule requiring NOx emissions reductions from 22 states and the District of Columbia during the May-to-September ozone season each year beginning in May 2004.  The rule also established a NOx trading program.  Power plant owners have predominantly installed SCR systems to comply, but further SCR installations will be needed as the bank of emissions allowances is depleted.

New Regulations 
In March 2005, the U.S. EPA promulgated two separate rules—the Clean Air Interstate Rule (CAIR) and the Clean Air Mercury Rule (CAMR).  In June 2005, the EPA promulgated the Clean Air Visibility Rule (CAVR).  The CAIR limits SO2 and NOx emissions in the Eastern U.S. while the CAVR limits SO2 and NOx emissions, leading to visibility impairment, in the Western U.S.  The CAMR limits nationwide mercury emissions.

Clean Air Interstate Rule (CAIR)
The CAIR is designed to help states meet the Ozone and Fine Particulate Matter NAAQS.  In contrast to the Acid Rain Program, which set a nationwide cap on SO2 emissions and emissions rates for NOx based on boiler type (instead of a NOx cap), the CAIR sets region-wide emission caps for both SO2 and NOx.  Emission reductions are to be achieved in two phases—the Phase 1 deadline is 2009 for NOx and 2010 for SO2 while the Phase II deadline is 2015 for both SO2 and NOx.  When fully implemented, the CAIR will reduce SO2 emissions in 28 Eastern states and the District of Columbia by over 70% and NOx emissions by over 60% from 2003 levels.  The CAIR applies to fossil fuel burning, electric generating units in the region that are greater than 25 MW.

Clean Air Mercury Rule (CAMR)
The CAMR is designed to reduce emissions of mercury from power plants by about 70% by 2018.  EPA assumes that Phase I (2010) mercury reductions will be achieved largely through co-benefits of SO2 and NOx control equipment installed to meet the CAIR, while Phase II (2018) reductions will be achieved through the addition of mercury-specific control technology.

Clean Air Visibility Rule (CAVR)
The CAV applies to non-CAIR states, primarily in the West, and affects power plants and other major sources with the potential to impact visibility, fine particles, acid deposition, and ozone in certain areas of the country.  CAVR place Best Available Retrofit Technology (BART)—FGD for SO2 reductions and SCR for NOx reductions—on many coal-fired units outside of the CAIR region in 2013/2014.

Proposed Legislation 
Although the U.S. EPA has promulgated the CAIR and CAMR, the Administration maintains its preference for passage of Clear Skies legislation.  The Clear Skies Act of 2005, introduced in January 2005 by Senators James Inhofe (R-OK) and George Voinovich (R-OH), calls for nationwide power plant emission reductions of SO2, NOx, and mercury by approximately 70% by 2018.  The reductions would be achieved through a market-based cap-and-trade system.  In the absence of successful passage of Clear Skies legislation, the CAIR and CAMR will remain in effect.

The Clean Air Planning Act of 2006 is a new version of legislation introduced in the 108th Congress. It would more strictly control mercury and other emissions from power plants, resulting in cleaner air than under the administration's CAIR and mercury rules, or the president's Clear Skies legislation. The bill is cosponsored by Senators Lincoln Chafee (R-RI), Tom Carper (D-Del.), Lamar Alexander (R-Tenn.), Judd Gregg (R-N.H.) and Dianne Feinstein (D-Calif.).

State Initiatives
In addition to federal initiatives, individual states are taking direct action to limit multiple pollutants.  In many cases, the standards are more stringent than federal standards under consideration.  In addition, some of the state rules restrict trading or do not allow trading, necessitating installation of control equipment.