April 12, 2004—Private citizens, brokers, and power plants bought and sold 250,011 tons of sulfur dioxide (SO2) at the 12th annual acid rain allowance auction on March 22 at the Chicago Board of Trade. An EPA progress report on the Acid Rain Program released in November 2003 details the emissions reductions resulting from the program.
The Clean Air Act established an annual national cap on SO2 emissions. Power plants hold annual allowances that they can use to cover SO2 emissions up to the cap level. In addition, the Clean Air Act mandates that a limited number of those allowances are withheld and auctioned. The auctions help ensure that new electric generating plants have a source of allowances beyond those allocated initially to existing units.
According to EPA, SO2 emissions from electric power generation continue to decline, down by more than 7 million tons since 1980, improving human and environmental health, earlier, and at less cost, than would have occurred with more conventional approaches. Current estimates indicate compliance costs at 75% below those originally predicted by EPA. Acid deposition in the eastern US has declined by approximately 30%, and many lakes and streams are showing signs of recovery.
For detailed results of this year’s acid rain auction and information about how the trading program works, visit EPA.
