Proposed EPA Mercury Regulations Could Spur Renewed Investments In Mercury Capture Tech

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In January, the Environmental Protection Agency (EPA) announced a proposal to bring back a set of hazardous air pollutant regulations known as the 2012 Mercury and Air Toxics Standards (MATS). The rules had been in strong effect until the Trump administration attempted to revoke the MATS regulations in 2020. 

“Controlling HAP [Hazardous Air Pollutants] emissions from power plants improves public health for all Americans by reducing fatal heart attacks, reducing cancer risks, avoiding neurodevelopmental delays in children and by helping to restore certain ecosystems people and businesses value,” the agency wrote in a fact sheet about the decision. 

The renewed regulations will impose higher standards of health and environmental safety on power plants across the country and require more stringent cleanup and emissions control technology to meet EPA standards. Here’s what the new rules entail, how they might impact the energy sector, and what solutions are available to help comply with new EPA regulations.

The Background and Impact of the Renewed EPA Regulation

Before MATS went into effect, power plants were the largest domestic source of mercury and other toxic air pollutants. The 2012 rules required these major sources of pollution to reduce emissions and meet the EPA’s standards by 2016.

By 2017, mercury emissions from power plants in the U.S. had been reduced by 86%. Similarly, non-mercury metal emissions and acid gas emissions were reduced by 81% and 96% respectively. The agency estimated that the reduction prevents up to 11,000 deaths, 4,700 heart attacks, and 130,000 asthma attacks while also reducing sick days resulting in missed work by 540,000 annually — a health benefit that means between $37 billion and $90 billion in health care costs saved each year.

Despite the impressive results, 23 states challenged the EPA’s mercury rule in court, and in 2015, the Supreme Court determined that the agency should have considered the costs of the emissions standards before implementing them. The EPA came back the following year with findings that showed that the regulations were still appropriate, even after considering costs.

However, in 2020, the agency issued a reversal of that findings and stated that the benefits did not outweigh the high costs of controlling emissions. With that, MATS rules remained in place but the reversal opened the door for companies to file lawsuits if they didn’t want to comply with the standards.

That 2020 revocation is what the EPA is now proposing to reverse—in effect, bringing back the agency’s authority to enforce MATS regulations that had proved effective in cutting emissions. In addition to enforcing the 2012 standards, the EPA proposal also includes provisions for gathering public health information and public input needed to strengthen the regulations even further.

How Power Plants May Be Impacted

About 1,400 fossil-fuel-powered EGUs (electric generating units) powered by both coal and oil  at roughly 600 plants, are impacted by the regulations. They will need to control emissions and air pollution, bringing them down to strict numerical limits established by MATS. 

To do that, they implement a range of emission control technologies that can stop the mercury and other pollutants generated by the plants from entering the air. 

An analysis from the Environmental Defense Fund found that the cost of compliance was actually substantially lower than the EPA had initially estimated. While the agency initially put the estimated cost at $9.6 billion, the actual cost of compliance was just $2 billion. While that’s still high, especially for smaller companies, a range of available technologies exists that can help bring those costs even further down. 

The Cost-Effective Capture Potential of Sorbent Technologies?

With innovative technological advancements, like the mercury emissions capture systems offered by Midwest Energy Emissions Corp MEEC (ME2C), mercury is captured highly efficiently and effectively, the company has stated, assisting utilities to achieve, and often exceed, minimum emissions capture regulations imposed by MATS. Sorbents are materials that can absorb liquids or gasses, making them a great tool for capturing a wide range of toxic pollutants, including mercury. The patented sorbent technologies offered by ME2C, in particular, are reported by the company to be some of the most effective at mercury emission capture available today. While other sorbent technologies reduce mercury emissions by up to 70%, ME2C states that its sorbents can capture more than 90% while also being some of the most cost-effective.

The company estimates that more than 40% of coal-fired plants in the United States are using its sorbent technologies. 

Suppliers to the coal-fired sector, such as ME2C, are preparing for growth in this market in the near-term and through the next couple of years.  Even with a strong focus on renewable energy, the coal-fired sector remains stable for the foreseeable future and with stricter EPA regulations expected, companies like ME2C may be positioned to capitalize on demand that could follow.

In addition to mercury emissions, the proposed EPA regulations are also focused on byproducts of these emissions, which include coal ash, as well as wastewater.  EPA’s Director, Michael Regan, has championed cleaner water and coal waste leading the Duke Energy coal ash cleanup in his previous role leading North Carolina’s Department of Environmental Quality.   

Related to their expertise in sorbent technologies, ME2C is also developing new technologies that could extract rare earth elements (REE) from sources like coal ash and wastewater while also removing other harmful pollutants. Some estimates put the Critical Minerals market at $400 billion globally by 2050. This could present an important potential revenue stream for coal-fired utilities. Additionally, it might not only make cleaning up pollution more cost-effective for the utilities but also incentivize companies to go above and beyond the standards set — or, if the EPA does tighten restrictions even further, to comply more readily with those tougher standards.

This post contains sponsored advertising content. This content is for informational purposes only and is not intended to be investing advice.