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CRS85821EPWpage24
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CRS85821EPWpage24
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CRS-16 Other participant --The 1977 SDC study showed that 63 percent of characteristics: those served were between 16 and 20 years ' old with the average 16 and 17 year old per- forming at the 4th grade level; and --The SDC study also found that a typical pro- gram participant received about I hour of chapter 1 supplementary instruction per week;i Number unserved: —-Not available; Number
CRS85821EPWpage64
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CRS85821EPWpage64
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CRS-S6 Implications of Funding Reductions Unlike education programs and activities, public libraries may be viewed as low priority in most State and local budgets because they are not regarded as "essential" services. Funding reductions in this program could result in the elimination of library projects serving special needs groups or the de- velopment of certain innovative practices. Funding reductions could affect the ability of local communities to adopt certain automated information systems. These systems help to bring most libraries to minimum standards or allow them to acquire new technol- ogies that would enhance the quality and range of services their libraries could provide. a Federal funding has helped stimulate the development of interlibrary loan activities and certain other innovative library practices. Funding sdecreases could jeopardize this role and reduce support for development of the library as the community information center. On the other hand, funding reductions may not necessarily affect the gen- L eral public's access to library services which is one of the goals of this program, since nearly 96 percent of the population now have this access. Further, Federal expenditures for library services currently represent only 52 of the total funds spent on public library services. Thus funding reduc- tions may have a minimal impact on the quality or quantity of library ser- vices in the aggregate apart from the consideration of services to special special populations or adoption of innovative techniques. State and local governments could attempt partially to offset funding reductions by increasing their contributions to this program and providing library services more efficiently.
CRS84828ENRpage21
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CRS84828ENRpage21
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does not require offsets for future 802 emissions, either from existing sources increasing use from 1980 levels or from new sources constructed since 1980. Finally, H.R. 3400 mandates N0x reductions to be achieved by tightening New Source Performance Standards (0.4 lb. per million Btu for bituminous coal and 0.3 lb. per million Btu for subbituminous coal) together with tighter NOx standards
CRS84828ENRpage20
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CRS84828ENRpage20
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.4 million tons reduction by 1993. Each State's share would be determined by its share of utility emissions .for 1980 in excess of 1.2 lb of $02 per million Btus, with credit given for reductions achieved in stage one. The method of compliance is left open;
CRS84828ENRpage24
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CRS84828ENRpage24
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(552,300 tons S02, 102,800 tons N0x), Indianapolis Power & Light Company (226,500 tons S02, 53,100 tons N0x), Indiana & Michigan Electric Company (182,500 tons S02, 64,900 NOX), Northern Indiana Public Service Company (about 165,000 tons of S02), Southern Indiana Gas and Electric Company (94,500 tons S02, 15,300
CRS84828ENRpage23
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CRS84828ENRpage23
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CRS-17 Cost Considerations for Indiana The differences in costs of the two bills could be significant. The economic cost of the control technologies mandated by H.R. 3400 are generally believed to be greater than the costs of S. 768's "freedom of choice" alternative of letting sources decide how to meet emission reduction require- ments (although it is questioned whether utility
CRS84828ENRpage22
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CRS84828ENRpage22
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CRS-16. The Senate bill, S. 768, establishes a 31-State acid deposition impact area; it encompasses the 26 States east of the Mississippi plus the 5 States on its west bank. For this region, the bill would require by 1994 a reduction in annual S02 emissions of 10 million tons from the actual 1980 annual emissions level. In addition, with minor exceptions, any increases in S02 emissions from
CRS84828ENRpage18
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CRS84828ENRpage18
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CRS-12 their potential impacts on Indiana. To provide as much detail as possible, representatives of the utilities, mining industry, industrial concerns, and State Government were contacted. Q] However, much of the detailed analysis requested by the delegation could not be carried out because the required data were not available. The analysis is divided into six parts: (1) introduction, (2
CRS84828ENRpage26
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CRS84828ENRpage26
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CRS-20 tons NOx), and Hoosier Energy (50,585 tons $02, 6,703 tons Nox). It is these utilities which would probably have to bear the brunt of the reduction costs. A seventh utility, Indiana and Kentucky (which owns Clifty Creek-- 288,000 tons of S02 in 1980), would also have to reduce. However, over 90 percent of its parent company-Ohio Valley Corporation--is owned by out- of-state utilities
CRS84828ENRpage25
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CRS84828ENRpage25
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I45? CRS—19 FIGURE-1: Indiana's S02 and NOX Emissionsé&l950-1980 Source: (thousands of tons) 0 m1‘ /4» /95! /17») M75‘ /930 Work Group 3B, U.S.-CanddanMemorandum of Intent on Transboundary Air Pollution, Final Report, June 1982.
CRS84828ENRpage19
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CRS84828ENRpage19
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CRS-13 reductions will assist the Congress in deliberating on proposed legislation, and assist Indiana in developing alternatives to some of the potentially acute situations which this analysis identifies.
CRS84828ENRpage34
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CRS84828ENRpage34
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Lnnvucr uh: ............ - - 6.03.001.000 Publicnnu and highway Lighting ........ .. - 33.673357 Sula. to othur public unthoritia ............ - - 527.245 Rniln:-uh and railway! ............... - - ° Inurdopuuncnul ............... - - Total Sun In Ul4hu1eCouunen .... -- 14.611.941.424 Sglnforflalnic .... --......,.. ........ -._,..-_ - - 428638938’! TUPAL KILOWATP-HOUR SALES - - .. .. 184890.331.“ 1
CRS84828ENRpage32
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CRS84828ENRpage32
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of this came from four power stations; (1) Gibson Units 1-4 (2704 MW, 299,700 tons), (2) Cayuga Units 1-2 (1070 MW, 113,400 tons), (3) Gallagher Units 1-4 (628 MW, 60,000 tons), and, (4) Wabash River Units 1-6 (805 MW, 63,900 tons). All of these units are coal-fired. IQ] Reduction Strategies Under the scenarios outlined, PSI would have to reduce its emissions under H.R. 3400 by 405,000 tons and under S. 768
CRS84828ENRpage35
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CRS84828ENRpage35
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requirement. The alternative to scrubbing would require PSI to switch all of its units to coal emitting 0.0 to 1.0 lb. of 302 per million Btu to meet the reduction requirement. To be cost-effective to switch 11.5 million tons of coal to this "better-than-compliance" coal, the cost differential (including transportation) would have to be less than $15 a ton. With little blending possibilities
CRS84828ENRpage29
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CRS84828ENRpage29
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of Energy Elasticities. Published for Resources for the Future, Baltimore: John Hopkins University Press, 1981. _1/ EPA estimates for an existing 500 Mw powerplant. Capital and fixed O&¥ cpggs include a 1.3 retrofit factor. Cost estimates escalated rom ear y 0 dollars to 1982 dollars by the GNP implicit price deflator.
CRS84828ENRpage28
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CRS84828ENRpage28
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CRS-22 it is assumed that any additional emissions by individual utilities between 1980 and 1994 would be offset by additional reductions from those utilities. Including the Clifty Creek mandated reduction under H.R. 3400, this allocation formula results in reductions of 1,190,000 tons of S02 annually from 1980 levels. This is about 70,000 tons above the roughly 1,121,000 tons that is required
CRS84828ENRpage30
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CRS84828ENRpage30
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CRS-24 Coal Price Differential. Cost price differentials between high- and low-sulfur coals have compressed over the past few years to about $1.00 per ton delivered in some cases. Under an acid rain bill, the demand for lowbsulfur coal could drive this differential back up to previous levels of $5.00 to $10.00 a ton or higher. For this analysis, it is assumed that the differential would be $10.00
CRS84828ENRpage27
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CRS84828ENRpage27
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; one did not respond at all. The analysis given here directly reflects the level of response CRS received from the utilities. METHODOLOGY Reduction Requirements To do an analysis of acid rain control costs, one must make guesses about the world of the utilities in the early 1990s. This is very risky business. This analysis is based on one set of potential futures; strong cases could be made
CRS84828ENRpage31
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CRS84828ENRpage31
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CRS+25 by the individual utilities, is used in this analysis for the nominal discount rate for determining present value and the nominal capital charge rate for each individual utility. A real discount rate of 4.5 percent was used to determine the real capital charge rate. This is based on a embedded cost of capital of 10.5 percent and a long-term inflation rate of 5.7 per- cent. For the sixth
CRS84828ENRpage33
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CRS84828ENRpage33
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CRS-27 FIGURE 2: Service Area for Public Service of Indiana %SOURCE: Electrical World, 1981

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