What Section 316(b) means for public utilities

by Nathan Henderson and Bill Mcelroy, Stantec

For the last decade or so, the U.S. Environmental Protection Agency (EPA) has worked on section 316(b) of the Clean Water Act, which implements new standards for cooling water intake at industrial and manufacturing facilities. The new standards are expected to affect more than 1,260 facilities, including power utilities.

The ruling, scheduled to be finalized during summer, was delayed until Nov. 4. While still not official, most of the proposed changes are expected to move forward, so utilities can prepare for what’s ahead.

316(b) Defined

Section 316(b) of the Clean Water Act requires facilities that use more than 2 million gallons of water a day from lakes, rivers, etc. for cooling processes to ensure their systems have the most up-to-date technologies for minimizing environmental impacts. These impacts typically include trapping fish and other aquatic wildlife against the screens or drawing them into the facility, referred to in the new rule as “impingement” and “entrainment.” Facilities were expected to meet these requirements through a three-phased roll-out: all new facilities starting in 2001, existing large electric-generating facilities in 2004, and existing small electric and manufacturing facilities in 2006.

Riverkeeper, a New York-based water protection organization, challenged the rule in 2007 however, proposing closed-cycle cooling be the mandate for all cooling water intake systems. Since then representatives from the power industry and others have advocated for more flexible, technology-based standards, and the rule has been suspended and re-introduced several times, leading to this summer’s latest delay, to give EPA time to consult further with National Marine Fisheries Service and the U.S. Fish & Wildlife Service.

What It Means for the Electric Industry

The industries most affected by the new rule are power generation and manufacturing. While most large power companies have already been through the section 316(b) process in its previous rounds, smaller public power and rural cooperative facilities are now also within the proposed rule’s parameters and must comply. Following are changes that will trickle down to public utilities:

1. Cost. Depending on the age and equipment of the power plant, the costs involved in making the changes required to meet section 316(b) might be high. Those costs will be translated into higher generation costs, which become higher retail rates. These higher costs could affect everything from large, stock-owned power plants to small municipal plants and rural cooperatives.

2. Impetus for conversion or decommissioning. Some power companies are considering converting their coal plants to natural gas. The changes required by 316(b)—on top of recent effluent guidelines that are more costly and difficult to meet—might make the cost of continuing to run coal plants too much to bear, driving them to make the conversion or decommission the plant.

In addition, the desire to add renewable energy sources to the energy profile is strong across the country. As more coal plants close, states and power companies might look to replace them with other sources of energy than fossil fuel-based plants.

What’s next?

The more than 1,260 facilities that must meet the requirements of section 316(b), should it be approved, will have eight years to comply. For utilities, now is the time to find out what power companies and affected plants in their regions have planned. Are they making any changes? If so, what are they? How will they affect distribution? Once these questions are answered, utility management must talk to their maintenance and operations staffs to plan ahead for how the changes might affect their facilities.

In the meantime, follow the development of the rule as the Nov. 4 deadline approaches. Staying informed about the rule and its implications and requirements will leave power companies, electric utilities and their customers better prepared to adjust their budgets, processes and systems accordingly as the rule’s implementation progresses.


Nathan Henderson is a supervising project manager and 316(b) practice lead for Stantec.

Bill Mcelroy is a senior engineer Stantec’s Plymouth Meeting office who has more than 30 years of experience working in the power industry.

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