SO2 Acid Rain Program

The Acid Rain Program is a market-based initiative taken by the United States Environmental Protection Agency in an effort to reduce overall atmospheric levels of sulphur dioxide and nitrogen oxides, which cause acid rain. The Acid Rain Program was established under Clean Air Act. The SO2 program sets a permanent cap on the total amount of SO2 that may be emitted by electric generating units in United States. Under this system, EPA sets a cap on overall emissions. The program is an implementation of emissions trading that primarily targets coal-burning power plants, allowing them to buy and sell emission permits, or allowances, according to individual needs and costs. The SO2 allowance is then allocated to affected units serving generators that should be greater than 25 megawatts. Each allowance permits a unit to emit one ton of SO2. At the end of the year, each source must hold sufficient allowances to cover its SO2 emissions. While this program is still in force, it is significantly over shadowed by the Cross State Air Pollution Rule (CSAPR).