Calpine applauds the EPA approach to regulating GHG emissions

Houston, November 16, 2010 — On November 10, 2010, the U.S. Environmental Protection Agency issued guidance to assist permit writers and the power industry in complying with the prevention of deterioration and Title V permitting requirements of the Clean Air Act for greenhouse gas emissions.

Beginning January 2, 2011, GHG emissions from large stationary sources will, for the first time, be covered by the PSD and Title V permit programs.

“Calpine applauds the EPA‘s efforts to develop a reasonable and pragmatic approach to regulating GHG emissions under the Clean Air Act,” said Jack A. Fusco, President and CEO of Calpine. The EPA’s actions to date are reasonable and positive steps towards curbing GHG emissions from the electric power sector by focusing on energy efficiency improvements while retaining the existing permitting procedures of the Clean Air Act.”

The EPA’s GHG permitting guidance outlines a process similar to what has been required for other air pollutants regulated under the Clean Air Act, including the five-step “top down” best available control technology (BACT) analysis.

Calpine is familiar with this approach. Consistent with its track record in generating environmentally responsible renewable geothermal and natural gas-fired electricity, Calpine received the nation’s first federally enforceable air permit with limits on the emissions of carbon dioxide and other GHGs.

The PSD permit for Calpine’s Russell City Energy Center in Hayward, California, includes limits that will result in 50 percent fewer GHG emissions than even the most advanced coal-fired plants.

“Calpine’s Russell City project provides real-world proof that this approach to controlling GHG emissions can work while stimulating innovation, local development and jobs,” said Fusco. “While we continue to review the details of the EPA’s guidance, it appears that the EPA’s BACT guidance continues the measured approach the agency began with its proposal to limit the applicability of GHG permitting rules to the highest emitting sources. As the EPA makes clear, however, the document provides guidance, not iron-clad rules. As the EPA and the states move toward implementation, we look for them to stay on the reasonable course that the EPA has set.”

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