EMISSIONS DISPATCH UNDER THE UNDERUTILIZATION PROVISION OF THE 1990 UNITED-STATES CLEAN-AIR ACT AMENDMENTS - MODELS AND ANALYSIS

The acid rain title of the new Clean Air Act will impact utility planning and operations in many ways. One important provision of the title will constrain the operation of coal-fired generating units that are subject to SO2 limitations during Phase I of the Act (1995-99). Because only SO2 emissions from those units will require emissions allowances during that time, utilities will be motivated to shift production to non-Phase I units whose SO2 emissions are not limited until the year 2000. To prevent this from happening, the Act mandates that utilities maintain the fuel use rate of Phase I units at or above their 1985-87 level. This paper summarizes methods for including such underutilization constraints in probabilistic production costing models and real-time dispatch. As an input to the U. S. Environmental Protection Agency's rulemaking process, a production costing study has been conducted that compares two alternative rules that would define when underutilization of Phase I units occurs. It is concluded that significant cost savings could be realized if the more flexible of the two proposed rules were to be adopted.