On August 31, 2018 (83 FR 44746), EPA proposed the Affordable Clean Energy (ACE) rule as a replacement for the Clean Power Plan which EPA repealed in October 2017. On September 10, 2018, EPA extended the comment period through October 31, 2018 (83 FR 45588).

The ACE takes the form of revised emission guidelines that provide guidance for the development, submittal, and implementation of state plans to reduce greenhouse gases (GHG) from certain electrical generating units (EGUs). In the ACE, EPA proposes that Heat Rate Improvements (HRI) are the Best System of Emission Reduction (BSER) for existing coal-fired EGUs. EPA believes the proposed approach is in keeping with the Agency's statutory authority and past practice of ensuring that the BSER be determined by evaluating technologies or systems of emission reduction that are applicable to, at and on the premises of the affected source.

In addition, EPA proposed new regulations that provide directions to both EPA and the states on the implementation of emission guidelines. These new implementing regulations would apply to this rulemaking and any future emission guidelines issued under section 111(d) of the Clean Air Act. The new implementing guidelines would have EPA taking a guidance role to inform the development to state plans as well as the role of approving state plans. In this approach, states will have the primary role of developing standards of performance consistent with application of the BSER. In their effort, states may consider source-specific factors, including the remaining useful life of the affected source. EPA believes this establishes a balance between the EPA (which has the authority and responsibility to determine a nationally applicable BSER) and the states (which have the authority, responsibility, and discretion to establish existing source standards of performance, in consideration of source-specific factors).

Finally, EPA is proposing to revise New Source Review (NSR) to help prevent NSR from becoming a barrier to the implementation of efficiency projects at EGUs. Because efficiency improvements may result in an EGU achieving a higher utilization rate, the reduced hourly emissions may result in increased annual emissions, triggering NSR. Therefore, EPA is proposing to allow an optional NSR triggering mechanism based on the achievable 1-hour emission rate from certain EGUs. Several variations on use of a 1-hour emissions test, either alone or in combination with the existing annual emissions test, are proposed for comment.