BEFORE THE ILLINOIS POLLUTION CONTROL BOARD
IN THE MATTER OF:
)
PETITION OF MIDWEST GENERATION, LLC,
)
AS
07-03
WAUKEGAN GENERATING STATION
(Adjusted Standard -Air)
FOR AN ADJUSTED STANDARD FROM
)
35
1LL.ADM.CODE
225.230.
NOTICE OF FILING
Dorothy Gunn, Clerk
Persons included on the
Illinois Pollution Control Board
ATTACHED SERVICE LIST
James R. Thompson Center
Suite 11-500
100 West Randolph
Chicago, Illinois 60601
PLEASE
TAKE NOTICE that we have today filed with the Office of the Clerk of the
Pollution Control Board
APPEARANCES OF KATHLEEN C. BASSI, STEPHEN J.
BONEBRAKE, and SHELDON A. ZABEL ON BEHALF OF MIDWEST GENERATION,
LLC,
and PETITION FOR ADJUSTED STANDARD, copies of which are herewith served
Dated: January 10,2007
Sheldon
A. Zabel
Kathleen C. Bassi
Stephen
J. Bonebrake
SCHIFF
HARDIN, LLP
6600 Sears Tower
233 South Wacker Drive
Chicago, Illinois 60606
312-258-5500
ELECTRONIC FILING, RECEIVED, CLERK'S OFFICE, JANUARY 10, 2007
BEFORE THE ILLINOIS POLLUTION CONTROL BOARD
IN THE MATTER OF:
1
)
PETITION OF MIDWEST GENERATION, LLC,
)
AS 07-03
WAUKEGAN GENERATING STATION
1
(Adjusted Standard -Air)
FOR AN ADJUSTED STANDARD FROM
)
35 1LL.ADM.CODE 225.230.
)
APPEARANCE
I, KATHLEEN C. BASSI, hereby file my appearance in this matter on behalf of
MIDWEST GENERATION, LLC, WILL COUNTY GENERATING STATION.
Respectfully submitted,
Is1
Kathleen
C.
Bassi
Kathleen C. Bassi
Dated: January 10,2007
Sheldon A. Zabel
Kathleen C. Bassi
Stephen
J. Bonebrake
Joshua R. More
Glenna Gilbert
SCHIFF
HARDIN, LLP
6600 Sears Tower
233 South Wacker Drive
Chicago, Illinois 60606
3 12-258-5500
ELECTRONIC FILING, RECEIVED, CLERK'S OFFICE, JANUARY 10, 2007
BEFORE THE ILLINOIS POLLUTlON CONTROL BOARD
IN THE MATTER OF:
)
PETITION OF MIDWEST GENERATION, LLC,
)
AS 07-03
WILL COUNTY GENERATING STATION
)
(Adjusted Standard
-
Air)
FOR AN ADJUSTED
STANDARD FROM
1
35 1LL.ADM.CODE 225.230.
1
APPEARANCE
I, SHELDON A. ZABEL, hereby file my appearance in this matter on behalf of
MIDWEST GENERATION,
LLC, WILL COUNTY GENERATING STATION
Respectfully submitted,
1st
Sheldon A. Zabel
Sheldon
A.
Zabel
Dated: January 10,2007
Sheldon
A. Zabel
Kathleen
C. Bassi
Stephen
J. Bonebrake
Joshua
R. More
Glenna Gilbert
SCHIFF HARDIN, LLP
6600 Sears Tower
233 South Wacker Drive
Chicago, Illinois 60606
3 12-258-5500
ELECTRONIC FILING, RECEIVED, CLERK'S OFFICE, JANUARY 10, 2007
BEFORE THE ILLINOIS POLLUTION CONTROL BOARD
IN THE MATTER OF:
1
)
PETITION OF MIDWEST GENERATION, LLC,
)
AS 07-03
WILL COUNTY GENERATING STATION
1
(Adjusted Standard -Air)
FOR AN ADJUSTED STANDARD FROM
1
35 1LL.ADM.CODE 225.230.
)
APPEARANCE
I, STEPHEN J. BONEBRAKE, hereby file my appearance in this matter on behalf of
MIDWEST GENERATION, LLC, WILL COUNTY GENERATING STATION.
Respectfully submitted,
Is1
Stephen
J.
Bonebrake
Stephen J. Bonebrake
Dated: January 10,2007
Sheldon A. Zabel
Kathleen C. Bassi
Stephen J. Bonebrake
Joshua R. More
Glenna Gilbert
SCHIFF
HARDIN, LLP
6600 Sears Tower
233 South Wacker Drive
Chicago, Illinois 60606
3 12-258-5500
ELECTRONIC FILING, RECEIVED, CLERK'S OFFICE, JANUARY 10, 2007
BEFORE THE ILLINOlS POLLUTION CONTROL BOARD
IN THE MATTER OF:
PETITION OF MIDWEST GENERATION, LLC,
)
AS 07-03
WAUKEGAN GENERATING
STATlON
(Adjusted Standard
-
Air)
FOR AN ADJUSTED STANDARD FROM
35
1LL.ADM.CODE 225.230.
)
PETITION FOR ADJUSTED STANDARD
NOW COMES MIDWEST GENERATION, LLC, WAUKEGAN GENERATING
STATION, I.D. No.
097190AAC, by and through its attorneys, SCHIFF HARDIN LLP, and,
pursuant to Section
28.l(f) of the Environmental Protection Act ("Act"), 41 5 ILCS 5128.1(f), and
Section 104.402 of the Board's regulations, 35
1ll.Adm.Code
5
104.402, petitions the Board for
an adjusted standard from the requirements of the mercury rule, 35
I11.Adm.Code
5
225.230,
adopted by the Board on December 21,2006, in Docket R06-25 (the "mercury rule"). The
mercury rule requires, for the first time, control of mercury emissions by large coal-fired electric
generating plants. As this Petition is filed within 20 days of the Board's final order in R06-25,
pursuant to Section
28.l(f) of the Act, the Waukegan Generating Station ("Waukegan") is
exempt from the requirements of the mercury rule for such period of time as specified in Section
28.l(f). Midwest Generation and the Illinois Environmental Protection Agency ("Agency")
jointly filed comments in Docket R06-26 proposing the addition of Subpart F to 35
I11.Adm.Code
Part 225. Subpart F provides for an alternative compliance route for Midwest Generation
However, the Board has not yet acted upon Subpart F and cannot do so within the time necessary
for
the filing of this Petition. This Petition seeks relief for the timing of compliance of the hot-
side electrostatic precipitator ("HS ESP) at the Waukegan Generating Station, pending Board
ELECTRONIC FILING, RECEIVED, CLERK'S OFFICE, JANUARY 10, 2007
action on Subpart F. Therefore, in support of its Petition for Adjusted Standard, Petitioner states
as follows:
A. Standard from Which an Adjusted Standard Is Sought
(5
104.406(a))
The Board adopted the mercury rule on December 21,2006. That rule became effective
December 21,2006. 31
I11.Reg. 129 (January 5,2007). The mercury standard at 35
I11.Adm.Code
S;
225.230 from which Petitioner seeks relief is 0.0080 lb mercury1GWh gross
electrical output or 90
%
reduction of input mercury. However, Petitioner seeks relief from the
emissions standard only until July 1,201
I, for only Unit 7
B. Implementation of Clean Air Act Requirement
(§
104.406(b))
The Board promulgated the mercury rule in response to a requirement of Section 1 I l(d)
of the Clean Air Act, 42 U.S.C.
S;
741 l(d), under which the U.S. Environmental Protection
Agency ("USEPA") adopted the Clean Air Mercury Rule at 70
Fed.Reg. 28605 (May 18,2005).
C. Level of Justification
(§
104.406(c))
The mercury rule does not specify a level of justification necessary for the Board to grant
an adjusted standard from that rule
D. Description of the Nature of Petitioner's Activity
(§
104.406(d))
The Waukegan Generating Station is located at 529 East 135'~, Romeoville, Waukegan,
Illinois 60446. Though not pertinent to the mercury rule, Waukegan is located within the
Chicago ozone and
~~2.5'
nonattainment areas. Any area affected by Waukegan's activities in
question is not in the immediate vicinity of the plant but is, rather, downwind hundreds of miles
from the plant. As a large coal-fired power generating plant, emissions from Waukegan exit
1
Particulate matter 2.5 microns in aerodynamic diameter.
-2-
ELECTRONIC FILING, RECEIVED, CLERK'S OFFICE, JANUARY 10, 2007
very tall stacks and have very high plume rise. As a result, Waukegan's emissions have more
significance as a regional concern than as a local concern.
The Waukegan Station employs 183 people. The first boiler at the plant was constructed
in 1955, and the Station currently has four electric generating units
("EGUs")
The principal emissions from the Waukegan Station are nitrogen oxides ("NOx"), sulfur
dioxide
("SOz"), and particulate matter ("PM). NOx is controlled through the use of overfire
air equipment on all four of the boilers and low NOx burners on two of the boilers. SO2 is
controlled through the use of low sulfur Powder River Basin coal. PM is controlled through the
use of electrostatic precipitators ("ESPs") on the boilers and through enclosures, covers, dust
suppressant application, dust collection devices, and good management practices on station
activities supporting boiler operation, such as the coal pile and coal handling operations. In
2006, the Waukegan Station emitted 4,320 tons
ofNOx, 11,816 tons of SO2,736 tons of PM,
and an estimated 216 pounds of mercury.
E. Description of the Efforts and Costs Necessarv to Complv with the Mercurv Rule
(8 104.406(e))
The Waukegan Station cannot comply with the mercury rule as adopted. The mercury
rule assumes that an
EGU can comply with the rule with the addition of halogenated activated
carbon
("HCI") injected into the exhaust stream prior to the ESP. Based upon that assumption,
the mercury rule further assumes that all regulated sources can install and operate the necessary
control technology and thereby achieve compliance by the 2009 compliance date. However,
tests have shown and the Agency and Board have acknowledged that certain ESP configurations,
namely HS ESPs, do not perform to the requisite standard. R06-25 Springfield Transcript
("R06-25 S Tr.), June 21,2006, p.m., pp. 103-104; R06-25, Board Order, Second Notice
(November
2,2006), pp. 24-25. Instead, to achieve a 90% reduction in mercury emissions,
ELECTRONIC FILING, RECEIVED, CLERK'S OFFICE, JANUARY 10, 2007
EGUs with HS ESPs require, at a minimum, either the installation of a baghouse prior to the
stack or the conversion of the HS ESP to a cold-side ESP ("CS ESP").
R06-25 S Tr., June 21,
2006,
p.m., pp. 113-1 14. As a result, the costs of compliance for EGUs with HS ESPs are
significantly higher than the cost of merely adding HCI. Additionally; the time necessary for an
EGU with a HS ESP to be
able to comply is significantly longer than that required for units that
merely need to add HCI because EGUs with HS ESPs require significant additional controls to
comply. There is insufficient time for the additional required mercury controls to be designed,
acquired, installed, debugged, and placed into operation at the station prior to the compliance
date of the rule.
The Agency estimated that the cost of compliance for an EGU with a
HS ESP is $9-21
million. R06-25 S Tr.: June 21,2006, p.m., pp. 24-25, 103. However, William DePriest, Senior
Vice-President at Sargent
&
Lundy, testified in the mercury hearings, that the cost of a baghouse
ranges from $42-92 million depending upon complexity and the time for project development,
installation, and shake-down is approximately
36 months. R06-25 Ex. 11 5, pp. 20,22;
generally
see
R06-25 Chicago Transcript ("R06-25 C Tr."), August 18,2006, a.m., pp. 1064, 1071-1072,
1226-1227.
Subsequent to the mercury hearings, Midwest Generation contracted with Shaw Stone
&
Webster to update Sargent
&
Lundy's projections regarding the installation cost for baghouses.
Shaw Stone
&
Webster estimated that the costs had increased approximately 92%, or
approximately
$121 million. Additionally, Midwest Generation has found, based upoil the
availability of resources, that the time for project development through shake-down has
increased to a minimum of
38 months.
ELECTRONIC FILING, RECEIVED, CLERK'S OFFICE, JANUARY 10, 2007
Midwest Generation also explored converting the HS ESPs to CS ESPs. The cost of
conversion to a CS ESP is $18-25 million but requires a 16-20 week outage, resulting in lost
sales opportunities. This period is significantly longer than any current planned outages. The
outage generally necessary for the installation of a baghouse, by comparison, is only
approximately 25 days.
Though the cost of conversion of the HS ESP to a CS ESP is less than the cost of the
installation of a haghouse, excluding the value of lost revenue, the reductions of
SO2 and PM that
would result through the
baghouse make that option more attractive to Midwest Generation,
Moreover, the installation of the
baghouse will result in greater benefit to the environment
because of the reductions of
SO2 and PM in addition to the reductions in mercury emissions,
F. Description of Proposed Adiusted Standard
(5
104.406(0)
Midwest Generation proposes that the requested adjusted standard provide a longer
period of time for the Waukegan Station to comply with the mercury rule adopted by the Board
in R06-25, with respect to Unit
7, as set forth in the following language:
a.
Midwest Generation must install and properly operate and maintain ACI
equipment on Waukegan Unit
7 by July 1,2009, consistent with the requirements
of 35
I11.Adm.Code Part 225, Subpart B.
b.
Waukegan Unit
7 shall not be subject to the requirements of 35 111.Adm.Code Part
225, Subpart
B before July 1,201 1.
c.
Beginning on July 1,201
1. and thereafter, Waukegan Unit 7 is subject to the
provisions of 35
111.Adm.Code Part 225, Subpart B, as applicable on that date.
d.
All other units at the Waukegan Generating Station are subject to the provisions
of 35
111.Adm.Code Part 225, Subpart B.
e.
If Midwest Generation chooses to demonstrate compliance with the mercury rule
pursuant to 35
111.Adm.Code
5
225.230(d), Unit 7 shall not be included in the
source-wide averaging before July
1,20 11, unless Midwest Generation elects to
include Unit
7 prior to that date. If Midwest Generation chooses to include Unit
'7
ELECTRONIC FILING, RECEIVED, CLERK'S OFFICE, JANUARY 10, 2007
in the source-wide compliance averaging prior to July 1,201 1, it must provide the
Agency with 30 days' notice of its intent to include Unit 7.
f.
If Midwest Generation chooses to demonstrate compliance at its other generating
stations pursuant to 35
111.Adm.Code
§
225.232, system-wide averaging provided
through December 31,2013, Midwest Generation may choose to include the
Waukegan Unit 7 in the averaging demonstration in the manner set forth in
subsection (e) above, or it may choose to exclude the Waukegan Unit 7 from the
averaging demonstration. Midwest Generation must provide the Agency with 30
days' notice of its intention to include or exclude the Waukegan Unit 7 from the
averaging demonstration pursuant to 35
I11.Adm.Code
5
225.232.
G.
Description of the Impact of the Adiusted Standard on the Environment
(§
104.406(g))
No impact to the environment is expected if the adjusted standard is granted. The
Agency produced no evidence in the record in the mercury rulemaking, R06-25, that indicated
that emissions of mercury from the Waukegan Station impacted local health or the local
environment. There are innumerable natural and
manmade sources of mercury. R06-25, Board
Order, Second Notice (November
2,2006), pp. 6-7. Mercury emissions from EGUs in the
United States account for only about 1% of worldwide mercury emissions
(
R06-25 Ex. 126, p.
3; R06-25 C Tr., August 21,2006, p.m., p. 1488), and mercury emissions from the Waukegan
Station are a minute fraction of that amount. As noted above, the Waukegan Station is estimated
to have emitted about 216 pounds of mercury in 2006, and that is a reasonable estimate of future
mercury emissions until additional mercury controls are installed. The adjusted standard sought
herein would only temporarily defer applicability of the mercury standard under the rule to
provide sufficient time for installation of controls. In addition, there is no direct, measurable
correlation between mercury emission reductions and decreases in fish tissue mercury levels, and
consumption of fish is the primary pathway of concern underlying the mercury rule.
Generally
see R06-25 Exs. 126, 129, and 130. There is no evidence of a link between mercury emissions
from the Waukegan Station and any aquatic impact. The temporary and relatively minute
ELECTRONIC FILING, RECEIVED, CLERK'S OFFICE, JANUARY 10, 2007
increase in mercury emissions attributable to the adjusted standard sought herein would be
inconsequential, and no environmental harm would result from the granting of this adjusted
standard.
Further, the proposed adjusted standard language requires Midwest Generation to
implement mercury reduction measures on the
EGUs at the Waukegan Station by July 1,2009.
Therefore, these units, with the exception of Unit 7, may achieve a 90% removal from input
mercury, according to the Agency's position in the mercury rulemaking hearings. Some lesser
level of reduction would likely occur at Unit 7. Consequently, the amount of mercury emitted
after July 1,2009, from the Waukegan Station would be at a rate less than the current emissions
rate, further benefiting the environment prior to the full compliance date required by the adjusted
standard.
H. Justification for the Adiusted Standard
(9 104.406(h))
The Agency's basic assumption during the mercury rulemaking was that installation of
HCI would result in a 90% removal of mercury as measured from input coal. However, the
Agency acknowledged that testing of HCI on various boiler and control equipment
configurations indicates that boilers equipped with HS
ESPs have not, in any of the testing of
HCI, achieved a 90% reduction in mercury emissions without the addition of a baghouse.
R06-
25 S Tr., June 21,2006, p.m., pp. 106-107. It is not possible for Midwest Generation to design,
acquire, install: debug, and operate a
baghouse at the Waukegan Station by July 1,2009, the
compliance date for the mercury rule. R06-25 C Tr., August
IS, 2006, a.m., pp. 1226-1227.
Therefore, Midwest Generation requires additional time to comply with the rule. Failure to
obtain additional time could result in unit shutdown with attendant loss of electricity generation
and costs, including possible impact on
the transmission grid and loss ofjobs. Midwest
ELECTRONIC FILING, RECEIVED, CLERK'S OFFICE, JANUARY 10, 2007
Generation is required to comply with the mercury rule with respect to four of its six other
stations2 as well, which when coupled with the required compliance activities at Waukegan,
including the significant costs of a baghouse, will strain Midwest Generation's resources.
Moreover, the additional environmental benefit of removal of
SO2 and PM emissions that are
inherent in the type of
baghouse necessary for this application justify the additional time
necessary for Midwest Generation to comply with the mercury rule.
The Agency and Midwest Generation filed Joint Comments in Docket R06-26, the CAIR
rulemaking, requesting that the Board adopt Part 225, Subpart
F, which establishes a compliance
date of January 1,2016, for Waukegan Unit 7. This is additional, tacit acknowledgement on the
part of the Agency that Waukegan Unit 7 cannot comply with the requirements of the mercury
rule by July 1, 2009. Further; as discussed above, the requested adjusted standard would not
result in environmental harm
I. Consistent with Federal Law
(§
104.406(i) and 8 28.1(~)(4) of the Act)
The Board may grant the requested adjusted standard consistent with federal law.
Pursuant to the federal Clean Air Mercury Rule ("CAMR"), 40 CFR
5
60.24, the Agency is
required to submit a state program that complies with the requirements of Section
I1 l(d) of the
Clean Air Act, 42 U.S.C. 741
l(d). The CAMR requires that Illinois comply with a cap on
emissions of mercury from coal-fired power plants in a manner determined by the State. Based
upon information provided by
USEPA, the estimated regional reductions that would be achieved
in Phase 1 (2010-2017) of the CAMR were 47% from a 1999 baseline.
Argus Air Daily
(March
16,2005), p. 4 of 7. The 90% reduction required by the Illinois mercury rule far exceeds the
Note that Midwest Generation is seeking parallel adjusted standard for its
HS ESP at the
Will County Generating Station in Docket AS 07-04.
ELECTRONIC FILING, RECEIVED, CLERK'S OFFICE, JANUARY 10, 2007
percentage reduction that USEPA anticipated, even though the Waukegan Station may not
achieve the 90% reduction by 2010, the compliance date for the CAMR. Jim Ross, Manager of
the Division of Air Pollution Control at the Agency, testified that the Agency believes that there
is sufficient margin under the cap to accommodate the less-than-90% reduction that the
Waukegan Station will achieve. R06-25, Board Order, Second Notice (November
2,2006), p.
89. Therefore, the adjusted standard is consistent with federal law
J. Reauest for Hearing
($
104.4060))
Because the Agency must submit the adjusted standard, if granted, to USEPA to become
part of the State's implementation program for the CAMR pursuant to Section 11
l(d) of the
Clean Air Act, there must be a hearing
on this matter. Midwest Generation requests that the
Board schedule and hold a hearing on this petition for adjusted standard.
K. Supvorting Authorities
(5
104.406(k))
Midwest Generation has relied upon Clean Air Act Section 11 l(d), the federal CAMR,
and
Argus Air
Daily,
in addition to the R06-25 record, in the development of this Petition for
Adjusted Standard. Copies of the appropriate portions of the Clean Air Act, the Code of Federal
Regulations, and the March 16,2005,
Argus Air
Daily
are attached hereto for the Board's
reference. Although Midwest Generation has relied upon the written testimony and transcript
developed in Docket R06-25, it has not provided additional copies of that written testimony or
transcript, as the written testimony and transcript are already within the Board's possession in
that Docket and are therefore available to the Board, the Agency, and the public.
ELECTRONIC FILING, RECEIVED, CLERK'S OFFICE, JANUARY 10, 2007
L. Substantially and Si~nificantly Different Factors Relating to Petitioner
(§
28.l(c)(l)
of
the Act)
Waukegan Station is substantially and significantly different from other EGUs subject to
the mercury rule because of the HS ESP on Unit
7. The Agency and the Board, as discussed
above, have acknowledged that an EGU with a HS ESP is a substantially and significantly
different boiler and pollution control equipment configuration that does not lend itself to
compliance with the mercury rule by the installation of HCI alone. The installation of the
additional equipment necessary for Waukegan Unit
7 to comply will take a significantly longer
period of time and impose significantly more expense than anticipated by the Agency in the
development of the mercury proposal for the CS ESPs in the state.
M. Adiusted Standard Justified by the Substantially and Significantly Different Factors
(3 28.1(~)(2)
of
the Act)
Both the Agency at hearing and the Board acknowledged that sources with HS ESPs
could seek relief through a variance or an adjusted standard. As discussed further above, units
with HS ESPs cannot comply
by the July 1,2009, compliance date for the mercury rule. Failure
to extend that date for EGUs with HS ESPs could result in unit shutdowns with attendant loss of
electricity generation and costs, including possible impacts on the transmission grid and loss of
jobs. An adjusted standard providing for a different compliance date or a different removal
standard is justified
N. Environmental or Health Effects Not Significantly More Adverse Than Rule
(5
28.1(~)(3)
of
the Act)
Granting the Waukegan Station this requested adjusted standard will not result in
environmental or health effects significantly more adverse than the mercury rule. Waukegan is
only one of 21 generating stations subject to the rule. The Waukegan Station represents only
7%
of the total megawatts in the state. Illinois EGUs as a whole contribute only a small portion of
ELECTRONIC FILING, RECEIVED, CLERK'S OFFICE, JANUARY 10, 2007
the mercury emissions attributable to EGUs in the United States that are subject to CAMR, and
as discussed above, the total mercury emissions of all of these EGUs is a minute fraction of the
total worldwide mercury emissions that impact or may impact Illinois. Further, there is no direct
and measurable correlation between mercury emission reductions and reductions of fish tissue
mercury levels, as discussed above. In addition, Midwest Generation proposes to mercury
reduction measures at all units at the Station by July 1,2009, as discussed above. Accordingly,
the requested temporary deferral of the mercury rule's standard is inconsequential and will not
cause any adverse environmental impact.
WHEREFORE, for the reasons set forth herein, Midwest Generation, LLC, requests that
the Board grant the adjusted standard from 35
I11.Adm.Code 225, Subpart B sought herein for the
Waukegan Generating Station.
Respectfully submitted,
MIDWEST GENERATION, LLC,
WAUKEGAN
GENERATMG STATION
by:
Dated: January 10,2007
ELECTRONIC FILING, RECEIVED, CLERK'S OFFICE, JANUARY 10, 2007
Sheldon A. Zabel
Kathleen C. Bassi
Stephen
J. Bonebrake
SCHIFF
HARDIN, LLP
6600 Sears Tower
233 South Wacker Drive
Chicago, Illinois 60606
3 12-258-5500
Fax: 312-258-5600
ELECTRONIC FILING, RECEIVED, CLERK'S OFFICE, JANUARY 10, 2007
ELECTRONIC FILING, RECEIVED, CLERK'S OFFICE, JANUARY 10, 2007
42
$
7411
FEDERAL ENVIR(
CAA
9
111
section shall be promulgated not later than one year
after August 7, 1977. Any new or modified fossil fuel
fn-ed stationary source which commences construction
prior to the date of publication of the proposed revised
standards shall not be required to comply with such
revised standards.
(c) State implementation and enforcement of stan-
dards of performance
(1) Each State may develop and submit to the
Administrator a procedure for implementing and en-
forcing standards of performance for new sources
located in such State.
If
the Administrator finds the
State procedure is adequate, he shall delegate to such
State any authority he has under this chapter to
implement and enforce such standards.
(2) Nothimg in this subsection shall prohibit the
Administrator from enforcing any applicable standard
of performance under this section.
(d) Standards of performance for existing sources;
remaining useful life of source
(1) The Administrator shall prescribe regulations
which shall establish a procedure similar to that pro-
vided by section 7410 of this title under which each
State shall submit to the Administrator a plan which
(A) establishes standards of performance for any ex-
isting source for any
air pollutant (i) for which air
quality criteria have not been issued or which is not
included on a list published under section
7408(a) of
this title or emitted from a source category which is
regulated under section 7412 of this title but
(ii) to
which a standard of performance under this section
would apply
if such existing source were a new source,
and
(B)
provides for the implementation and enforce-
ment of such standards of performance. Regulations
of the Administrator under this paragraph shall
per-
mit the State in applying a standard of performance to
any particular source under a plan submitted under
this paragraph to take into consideration, among other
factors, the remaining usefnl
lie of the existing source
to which such standard applies.
(2) The Administrator shall have the same authori-
3NMENTAL LAWS
remaining useful lives of the sources in the category of
sources to which such standard applies.
(e) Prohibited acts
After the effective date of standards of performance
promulgated under this section, it shall be unlawful
for any owner or operator of any new source to
operate such source in violation of any standard of
performance applicable to such source.
(0
New source standards of performance
(1) For those categories of major stationary
sources that the Administrator listed under subsection
(b)(l)(A) of this section before November 15, 1990, and
for which regulations had not
been proposed by the
Administrator hy Novemher 15, 1990, the Administra-
tor shall-
(A) propose regulations establishing standards of
performance for at least
26 percent of such catego-
ries of sources within
2
years after November 15,
1990;
(B) propose regulations establishing standards of
performance for at least 50 percent of such catego-
ries of sources within 4 years after November 15,
1990; and
(C)
propose regulations for the remaining cate-
gories of sources within
6 years after November 15,
1990.
(2)
In determining priorities for promulgating stan-
dards for categories of major stationary sources for
the purpose of paragraph
(I), the Administrator shall
consider-
(A) the quantity of air pollutant emissions which
each such category will emit, or
will
be designed to
emit;
(B)
the extent to which each such pollutant may
reasonably be anticipated to endanger public health
or welfare; and
(C)
the mobility and competitive nature of each
such category of sources and the consequent need
for nationally applicable new source standards of
nerformance.
ty-
(A) to prescribe a plan for a State in cases where
(3) Before promulgating any
regulations under this
subsection or listing any category of major stationary
the State
to submit a satisfactory 'Ian as he
sources as required under this subsection, the Admin-
would have under section
7410(c) of this title in the
istrator shall consult with appropriate representatives
case of faiiure to submit an implement,ation plan,
of the Governors
of State
pollution control
and
agencies.
(B) to enforce the provisions of such plan in
cases where the State fails to enforce them as he
(g)
Revision of regulations
would have under sections 7413 and 7414 of this
(1) upon
by the G~~~~~~ of a state
title -4th respect to an implementation plan.
showing that the Administrator has failed to specify in
In
promulgating a standard of performance under a
regulations under subsection
(f)fl)
of this section any
plan prescribed under this paragraph, the
Administra-
category of major stationary sources required to be
tor shall take into consideration, among other factors,
specified under such regulations, the Administrator
Complete Annotation Materials, see Title 42 U.S.C.A.
876
shall revise such r
gory.
(2) Upon applic
showing that any
(
is not included in
1
this section contr
which may reaso
public health or
.
category is not
sources), the
Adn
tions to specify sl
(3) Upon applic
showing that the
properly the
crite~
subsection
(fl(2)
shall revise the lir
section to apply pr
(4) Upon appli,
showing that-
(A) a new, in
process which a
reduction has
any category of
(B) as a resu
new source star
this section for
greatest
degre<
through applica
of continuous
ej
consideration tl
reduction, and
ronmental imp:
been
adequate13
the Administratol
formance for such
(5) Unless late1
trator are othenv
Administrator sh:
lowing the date
Governor of a
Sta
(A) find tha.
the requisite
d
(B) grant sl
required under
(6)
Before taki
(fj
of this section
trator shall provi
hearing.
(h)
Design, equ
tional sta~
tion
(1)
For purpof
of the Administr:
enforce a stands
ELECTRONIC FILING, RECEIVED, CLERK'S OFFICE, JANUARY 10, 2007
40 CFR
Q
60.24
ELECTRONIC FILING, RECEIVED, CLERK'S OFFICE, JANUARY 10, 2007
40 CFR
Ch.
1
(7-1-05 Edition)
Enviro,
any l~ln!? r\'~?~:l!n
r:r:(e53,11)
to mq.tr
w:lr.c.isr- :ogrthtr wlth th? tr,xi oi
-pec:fi
?.hc
rr~~ui$~enlrr.t~
or *.hi; s'~l,,,~!i
~3ch pr,:scnt~l~un.
v.ilii\.a
b
I
r.
dr! f11Is
!
1
0
~f TI,,: Srlte dhnil iul,mlt with lhc
!ef!nt!t
n..thlr, n Sr.atr. I hr St,ltr .ili.~ll submlt
plan r~r ~~rrtslon.
131
E
a Ic.!'.~? 01 t'rrii?<a:!on lo tk.at effw t
11 I ~t-r~~r~catl~~
tflal
h hearin:' I.?-
I
dr
to he l!ttr n
I
I
ciulrtJ t,$ p31d~r.iph .I. oi ih1s secr~on
>tale.
sil I e
t a
I I.
st-
!?:is
hclcl :!I ac~oldaricr with the lrorlc?
.s!:tndl.
llo!!
.~uI!! ir.rtlfl~-,!lion zhal: cxen:pt
r~'tlu11td 1.y paray13ph .d! ui rhls >?I-
tluns
1.
1
st m
r
lr:t f ti
Ilon: .1nl!
vllforct
rul~p~r:
for that drsl?i.,:~.~l po:l.it.rnt
,2t
A
I,.-' of ~vtt~iesse~
:ind ti!ri~. ur~a-
cc,
E:
C, 1, t:xc?~!!
.,n
pr.c)vi,l,~L! in pal.,.
nizatldn.+l dffll~stloii5. if all\- nppmr-
f oft
<t.apn, .cl12 in,i c,
,1,
of
'hi;
>ec!:on.
lne at lhs hvarlne and a br1c.f urtttell
..l.%l<,r
the S:.att iha!i prLor
I<,
:!.r
auspnor.
cf
5unnl.liy ,of
c:~;h
prcst~ntatlon
or'
wrlt-
::.cared
.lny pi.3~ .I? Irv]-!on thr!\,of, cr,n.!u;t
T.pn subr:i~s.~~o~~.
Irlhllt?
ole
ti
,, I
, h.. h
I
1~1 lipon ~vrlrler~
appl.catlor1
by
:,
hr.allh.
St3te 011 s'.ch u!an ot [)la11 r+!'t$~o?.
Stair uu.l.t~c) ~thr~urh
lhc apul.ourintc
,:,
No htX,~tlt!g i113l: !,r ic.,,i~lrcd ],,r
Krrlor~~l Office,, the Admlr~~straror
rm15510
3111
~hanirv :o
.an
:ISCI
t.mrr.t
or uru(:rr5s
~CA)
;hul,l'd\'r Sla:e proc:cdu?es driirnrd
In!',
C
!I!
nn
appru\.ed cu~i?j>ll:irlc.i. chedule
to lnsut'e i~ul,llc p.il.r~c~pat~on
in ,.he
an<:c sh
I.r,le.5s tilt c!lnnirr
l-i
likel\- to
1he
maltrr.5 fur wmch l~rar~ngs
art.
I?-
is
prac
i.:~,
lr,
hr
L,!3~1:(. l3 ,.L!nY~y
qui!.?d a:lc ylli.ilc nor~ficatiun of tct.
c<,n.u:la
thr fin.il iun?plla-cr ii.11~
:I!
I).,, schr.,i- UPl~~Jr:iinlls Lo pal~tl~lpalc
it. In the
C
ill
llti!
!udrmr-nr of ihr Adrnlnlstlaror. tiic
~d
\+'I
3
,
,rr. h. I, ,llr,
,
L,?o~cdul~~~i.
although dllfe~rni from the
'ernline
rmlsiluc alaC,i:,r,i
tffl.L.l ir!.lol 10 thy
I'rqulrrt~~r~t.~
of 1111s subparl, in fa~t
ma!:
+ff,~crtvt. dntr of thl* D~I,p~~.~
~f it tvas
PI.oVld<: TGI. adrquart norict' to anti
p.~-
rncian:t>
ndop:rd aft+r
.I
public hr.,rirlg 2nd is at
Tlclp~ttun uf thc p~bli(. Thc .ldminih-
.
that
It~?t as s..,,ngent as the ,or~.espontltllg 11':ilol' mos Impose such condltlons or]
:
b:,~~
nc:
rmlaslo~> ruidrllnr! iprc:fie.d in tllc
np-
h1.i appl'uva! as he
deems
nucassars
ln,v bal
pl~cat,ie ruldt,linc ,lo% umet:r publlihrd
~".uWlIUl'rs .~VPI.OYC~
u11C:rl. this a~ctloll
urr.!,l~a~
uridei.
5
G0.Xl.r,.
-hail Le iltelncd to sat~sfy the ~?I]ULIC.-
1 loti pro
]dl
I
, Irit,ilrt.,!
~
1,).
~ para. ~ t~i~~llt
~ uf this
~
sul~parr
~
i.egal.dlrir proce-
1lr.t. ao<'t
rraph
ic,
of thl; scct10,l hill l,r held
du1~~5ft~rpublic
!~ra!.lnps.
I)UIIIIC
c.c
utlly atlnr ?~daona!.lr notl~r. S~ti(.c
10
y~
;01&,
s,,~
IsJ,
a*
JmPYt,td
,,i
60
.
s1:ilkIard
shall t,r. ::ven ar It's-1 Jo dnss klriot rc!
YR
~~414
rr,.
1,.
lwi]
V:LI'IRIIC~.
:kc Jalts of ,u;h licarln~ .xc,l ~ll.%Il
LC-
shal: be
i luJs:
$60.24
Emission standards and cornpli-
i
111
: 60
22
$1 Niitlflcdllon to
flr.
puLilc
tv
ance sc:hedulra.
,
icct,:\l a
pl~~lniincr~tl? nllvlr1:s.r.c
the
3
ia Rich plan .<k.all incluae emlsslolt
'
dd<,lecl UI
urnu. and place of s.it.h lir:u.:n~ In r.r~h
.:dnclards and comp11,nc:r- ,cl.edulr.s
e .I.
I
regton affrc tcci.
tLj<l,
b:nliss~<>n stdnd.*rda al~.~ll
prc-
I r~ldln~
I
2
1Iils. 1 1
I
f
u
l
scllllc nl1ow;rhle r:ttcs of errlsiluxls
es-
.
dltr rerlu
.%nnoun~emc.nl. 01 cart1 irr.ouoser1 pl:in
LPI~I ~vlii-n it i.i. clearly ~mpra<t,cat!e.
i
nlusi in~,l
>I'
rrvlslon Lh~~Ivol
for Pllbl;c !rlspt'c-
Such cases will be identified in tne
nlrr~rs of
:iun in 21 le3sr
rmtX
locarion in
h rc-
ul:
ducumt.nrs
issurd
under
r'lcrn tc, n.hich it ir!li apuiy:
$6O.?Z.
\Vt~ere etnlasior, stand~rdb prr-
13,
Nvtlfic.ilion 10 thr .%drnlnlstr3tor: ~r~birlg
t.<rulpment sllec~f>cat~on.-
are
I
OIIL.~~!
10 dl lo I
PI
eslal~ilsh?d, the plari shdll. to th? de.
lutiun conlrol ;icc~!cs In rach tae?on in
sret posslhle. set torlh the twiislorl rr
ivhich the plari or rvv?sion will npD!y.
ductlun.* arhlrvab~r by ilnplemrnration
pru~rr.~
s
of sllch spz<lfirat~nnj. and
may
permil
ln~ludt
rh
151
In tht
~2%
UI .in lnrt'l'state ~'..rion.
c~tnpllancc tly 1t1c use of rqulpmrnr rlr-
proxrrss :I
nn11flr.lrlon to an! o:ht3r 51:11.? in-
terrn~rle,I by the Slat(. 10 be equi\.~leut
c
iusr an,
cludrd in tht: reiriun
10 1 hat prr~cribcd.
~e l'hr Slatc ahall prupayc and rv
12,
Trst nrrthods arld grocedut.es tor.
taln. lor
.I
mlrilmul~l of 2 st'.ll.s.
A
determililnr compliancr with lhe em>>-
SL~PL
ri.(.urd of e;u h licxrlnc for lnnpcctiotl
slon stnr#dards shall be spec~t~ed
in thr.
!IS ally inter?.-:rd
yart).. The srcortl
plan. Rlrthods orller thsrl thosr sprci-
shall run131r. ai
.$
nun:murn, a list of
fird 111 aupcrldix
A
to this pari rnky 1,r
ELECTRONIC FILING, RECEIVED, CLERK'S OFFICE, JANUARY 10, 2007
40 CFR
Ch.
I
(7-1-05 Edition)
nmental Protection
Agency
tnrssrs ~uyethe~
with the text ci
spccifizd in the plan 11 ~1ios.n 70 br
ch y~.ziencaciori.
eq~lv3lcnr or :tlrrrn.r~.ivc mrrhudi ar:
\-,
i.
--"
he
R~:IT~.
-----
shill
----- -
iubnlii
~~ ~--
with th~
deiined ln
860.2
anJ
u,.
an or revision:
mission standardsshall apply to
:I) Certification that each hearing re-
designated facilities within the
ired by paragraph
(c) Of this SeotlOn
e. A plan may contain emission
LS held in accordance with the notice
ards adopted by local jurisdic-
~uired by paragraph (d) of this SeC-
provided that the standards are
,n; and
ceable by the State.
:2) A list of witnesses and their OW-
Except as provided in paragraph
~mtional affiliations, if any, appear-
this section, where the Adminis-
5
at the hearing and a brief written
has determined that a des-
mmary of each presentation Or Writ-
ed pollutant may cause or con-
n
submission.
te to endangerment of public
pj Upon written
application
by a
h, emission standards shall be no
ate
asency (through the appropriate
stringent t.han the corresponding
gional Office), the Administrator
sion guideline(s) specified in sub-
ry approve State procedures designed
C
of this part, and final compli-
insme public participation in the
shall he required as expeditiously
~tters for which hearings aze re-
acticable but no later
~ ~
than
~.
t.he
ired and public notification of the
liance times specified in subpart
nortunitv
7~~~~~
"
to nartici~ate if. in the
his
~~-
"apt,.
. ~~~ ~
i~mcnr of the Adminislralur. the
(dl \Vi.ere rh? .i~ln:~n~~t~~.~i~,i.
haa
de.
,~edurcs. :~lthough dlii'ercnl from the
WrnIlnPd ilia1
n
dr'slrrlrdteli pollutant
(a~rrrnenis of' this subparr. In iacl
mdj
L.:Iu.$L' ui.
CO~II~~IIUIC to
witle lor adequare notlce to and par-
endanrermenr I
publlr welfare lrut
ipatlon of the puhllc.
The:
Adnsinls-
that
1d1
rrst' rfir>c~.'
(ID ~ut>iic health
bier may Impose such condrtlons on
,
approval as he deems necessary
medures approved under this sectlon
tll be deemed to satlsfy the requlre-
nts of
thls
subpart regarW proce-
oes for public: hearings.
).24
Emiasion standards
and
oompli-
ance schednles.
8
have not been demonstrated. States
%
mav balance the emlsslon
~~
euidehne-
,~~~ ~~..~
..
cumpiiancc timcs. .ind olher rnl'oi.ma-
riun pruvidrli in the .iyplicabie yu~rir'.
iinr durumcnt :,y.unst other fa~.lul.s of
public
coricern in eir.li~lish~ny
emission
arcls, compliance schedules, and
ces. Appropriate consideration
given to the factors specified
b) and to information pre-
the nubIic hearine(s.4) con-
I) Each plan shall include emission
ndards and compliance schedules.
b)(l) Emission standards shall Pre-
i'beallowahle rates of emissions ex-
required for submittal of the plan
tt when it is clearly impracticable.
include legally enforceable
incre-
-h
rrr-ei;
will
~-.
be
~~ --
identified in the
t3 of progress to achieve com~li-
deline documents issued under
h designated facility- or
22.
Where emission standards pre-
ilities. Unless otherwise
ibing equipment specifications are
e applicable subpart, in-
ablished, the plan shall, to the de-
ogress must include,
e possible, set forth the emission re-
,
each increment of
:$ions achievable by implementatio~
in 560.21(h) and must
;uch sneoifications. and may permit
onal increments of
iplia<ce by the use of equipment de-
be necessary to permit
mined
by the State to be equivalent
tive supervision of
;hat prescribed.
nal compliance.
!)
Test methods and pxocedures for
provide that compli-
ermining compliance with the ems-
r individual sources or
3
siaadards shall be specified in the
ces will be formu-
o.
Methods other than those speci-
mittal. Any such
I in appendix A to this part may be
subject of a public
-
S60.24, Note
hearlug held according to 560.23 and
shall be
submitted to the Adm1n1s-
trator wthin 60 days after the date of
:illuption of
the
iche~lule but ir; no chst.
inler :ha the date pr?scrlbed for
a,~b-
nlittsl of the iirst scniiannlral wnorr
required by 56O.Z5(e).
(f!
Unless otherwise specified in the
applicable subpart on a
case-hy-case
basis for particular designated facili-
ties or classes of facilities, States may
provide for the
application of less
Stringent emissions standards or longer
compliance schedules than those other-
wise required by paragraph
(c) of this
Section, provided that the State dem-
onstrates with respect to each such fa-
cility (or class of
fmiiities):
(1)
Unreasonable cost of control re-
sulting from plant age, location, or
basic process design;
(2) Physical impossibility of install-
ing necessary control equipment; or
(3)
Other facton specific to the facil-
ity
(Or Class of facilities) that make ap-
plication of a less stringent standard or
final compliance time significantly
more reasonable.
(g) Nothing in this subpart shall be
construed to preclude any State or
po-
litical subdivision thereof from adopt-
ing or enforcing
(1)
emission standards
more stringent than emission
guids-
lines specified in subpart C of this part
or in applicable guideline documents or
(2) compliance schedules requiring
final compliance at earlier times than
those specified in subpart
C or in appli-
cable guideline documents.
140 FR
53346.
Nov 17, 1975, as amended at
MI
FR
65414,
Dec
19.
1995:
65
FR
76384,
Dec
6,
ZWOl
~:~F~.c:l!'~.
1j.v~
NU':^.
AT
70
FR -3649.
Alav
18. 2M5. Pa24 w.~:.
amended
by
rerlalw
para-
r~aph
i?,tl)
arid adalnr ollal.nvh h
.
rife<:-
tive
July 18,
ZM15
For
the
oo<venience
of
the
User,
the revlsed and added text
is
set
forth
as
follows
960.24
Emission
standards
and
oolapliance
sobedules.
(b>(l) Em~m~on
standards
shall
elthsr
be
based on
an sllowanoe
sJrstem
or
prescrxbe
allowable
rates
of
emissions
except
when
it
is
clearly impracticable
* * *
ELECTRONIC FILING, RECEIVED, CLERK'S OFFICE, JANUARY 10, 2007
ELECTRONIC FILING, RECEIVED, CLERK'S OFFICE, JANUARY 10, 2007
ELECTRONIC FILING, RECEIVED, CLERK'S OFFICE, JANUARY 10, 2007
40
CFR
Ch. 1 (7-1-05 Edition)
Environmental
or stationary, ooal-fired combustion turbine
and associated energy generated by any spec-
expres~ly provid,
in the State sewing at any time, since the
ified unit and pays its proportional amount
rnent, owner
sha
start-up of a unit's combustion chamber, a
of such unit's total costs, pursuant to a con-
SOT,
or a person
generator with nameplate
oapa~ity of more
tract:
est through sue:
than 25 megawatts electric (MW) producing
(1) For the life of the unit:
men- are not
b;
eleotricity for sale.
(2)
For a oumulative term of no less than
rectiy) on the re
(2) For a unit that qualifies as a cogenera-
30
including contraots
$hat permit an
~g
Budget unit:
tion unit during the 12-month period start-
eleotion for early termination: or
(2) With regal
ins on the date the unit first produces elec-
(Q)
For
a
period
than
25
years
70
any person who
tricity and
oontinues to qualify as a cogen-
eration unit,
a
in the
percent of the economic useful life of the
with
respeot to t
serving at any time
a
generator with
unit determined as of the time the unit is
general
sooount
binding agreeme
nameplate capacity
of
more than
25
MW
built, with option rights to purchase or re-
count represent:
supplying in any calendar year more than
lease some portion of the nameplate capac-
son's ownership
one-third of the
out.
it9 and associated energy generated by the
allowances.
put capacity or 219,000 m, whichever is
at the end
Of
the
Potential electr;
greater, to any utility power distribution
Marimurn
design
heat input
means, starting
percent of
a ur
for sale, 1fa unit qualifies
as
a
cogen.
from the initial installation of a unit. the
input. divided
b3
ePstion
during the 12.month period
maximum amount of fuel per hour (in Btul
(BtwkWh), divic
starting on the date the unit first produces
hr) that a unit is capable of comhusting on a
watt-hour (kWl
eiectrioity but subsequently no longer quali-
steady-state basis
as specified by the manu-
fie8 as a cogeneration unit, the unit shall be
facturer of the unit, or, starting from the
Sequential use
<
subjeot to paragraph (1) of this definition
completion of any subsequent physical
(1) For a topp
starting on the day on which the unit first
change in the unit resulting in
a decrease
in
the use of rejec
no longer qualifies as a cogeneration unit.
the
meximum amount of fuel per hour (in
duction in a
us*
Generator
means
a
device that produces
Btu per hour, BtWhr) that a unit is capable
tion or process;
I
of ~ombuating on a steady-state basis, such
(2) For a bc
Gross electvical output
means, with regard
decreased maximum amount
as
specified by
unit, the use of
to
a cogeneration unit, electricity made
the penon oonducting the physical change.
ma1 energy
apy
avsilable for use, including any such elec-
Nameplate
capacity means, starting from
tricity productit
tricity used in the Power production Process
the initial installation
of a generator, the
Sonrce
means
(Which process includes, but is not limited
maximum electrical generating output. (in
installations lot
to, any on-site processing or treatment of
MW) that
the
generator is capable of pro-
uous or adjacel
fuel combusted at the unit and any an-site
ducing
on a steady-state basis and during
oontrol of the
si
emission oontrois).
continuous operation (when not restricted by
State means:
Gross
thermal
energy
means. with regard to
seasonal or other derates) as specified by the
(1) Far purpos
a cogeneration unit, useful thermal energy
manufacturer of the generator or, starting
entity, one of
output
PIUS, where such output is made
from the completion of any sobsequent phys-
States, the
Dis
av&ilable for an indastrial ar oommeroial
ioal change in the generator
in an
proved for treat
process, any
heat contained in condensate
inorease in the maximum electrical gener.
of this chapter.
return
or makeup water.
ating output (in
MW) that the generator is
dim Tribe that
Heat input
means, with regard to
a
speci-
~apahle of producing on a steady-state basis
ing Program
pu
fied period of time, the product (in million
.,d
during continuous operation (when not
(2)
For
PU~P
British thermal
units
Per unit time,
reatrioted by seasonal or other dsrates). such
graphic area,
01
MMBTUltime) of the gross calorifio value of
increased
amount
as
by
States, the Dis
the fuel (in
Btu per pound. BtWlb) divided by
the person conducting the physical change.
Nation Indian
8
l,WO,WO Btn/MMBTU and
the
0perator
meam any person who operates,
dian country.
fuel feed rate into
a oomhustion device (in lb
controls,
or
supervises
an
EGU
or
a
source
Tapping-cycle
of fueutime),
as
measured, recorded, and re-
that includes an EGU and shall include, but
generation unil
ported to the Administrator by the
Hg
des-
be limited to, any holding oompany, util.
the unit is
f
ignated representative and determined by
ity system, or plant manager of such EG~
or
power, inoludi
the Administrator
in accordance with
source.
Some of the re
P560.4110 through 60.4116 and excluding the
production is
heat derived from preheated combustion air,
Ounce
2'84 lo' micrograms'
thermal energs
~etioulated flue gases, or exhaust from other
Owner
means any Of the
Total energy
sources.
(1) With regard to a
Hg
Budget
source
or a
oogeneration
D
H~
allowance
means
a
limited authori.a.
Hg Budget unit at a source, respectively:
supplied to
th<
tion issued by the permitting authority to
li) Any holder of any portion of the legal or
energy produc
emit one ounce of
~g
during a control period
equitable title in a Hg Budget unit at the
of the specified calendilr year for whioh the
Source
or
the
Hg
Budget unit;
Total energy
authori%&tion is allocated or of any calendar
lii) Any holder of a leasehold interest in a
cogeneration
t
year thereafter.
Hg Budget unit
kt the
source
or the
Hg
Budg-
and useful thc
Life-of-the-unit,
Jim
power contractual
ar-
et unit: or
cogeneration
z
rangement
means
a
unit participation power
(iiij Any purchaser of ~ower from a
Hg
Unit
means
e
sales agreement under which a customer re-
Budget unit at the source or the
Hg
Budget
&stationary el
serves,
or
is entitled to receive, a specified
unit under a life-of-the-unit, firm power can-
Useful powe?
amount
or
percentage of nameplate capacity
tractual arrangement; provided that, unless
generation
ur
ELECTRONIC FILING, RECEIVED, CLERK'S OFFICE, JANUARY 10, 2007
ELECTRONIC FILING, RECEIVED, CLERK'S OFFICE, JANUARY 10, 2007
Argus Air Daily
(March
16,2005)
ELECTRONIC FILING, RECEIVED, CLERK'S OFFICE, JANUARY 10, 2007
Argus Air Daily
US
Emissions Market Prices. News and Analvsis
Volume
12.051.
March
16. 2005
3
I.
.. .
Utilitv de-listing likelv focus of Hg lawsuits
. .
2PC5
68500 ,
595 00
693 O0 .
. ., 07 .. . .
iirdou\ ;iir p~~llut:tnts allowed 1I1e qenq
111
heI~,ct a
cap-arid-
trade al~l,r~,arl~
a\ a nlcans 11, c#,nrr#,l
roerrar!
vn~is\iq,n$, bul
I
Bid
Ask
Price
I
the
tllr nlovr
final
mercury
!rill likelv
rule.
bra uritnc il~cus
,,fan\
la,,suit attarhinv
-
2005
3,350.00
3.425.00
3.387.50
2006
3.450.00
3,550.00
3,500.00
"The de-listing is the big issue here. If you cannot de-list
2007
2,850.00
3,000.00
2.925.00
then you need lo have a maximum achievable control technol-
2008
2,300.00
2,750.00
2,525.00
ogy (MACT) standard," said Scott Edwards, legal director at the
2009
2,200.00
2,500.00
z.350.00
Waterkeeper Alliance, which announced plans yesterday to sue
EPA over the mercury
rule.
EPA determined in Decemher 2000 that it was "appropriate
and necessary" to regulate power plants under Section
112 of
the Clean Air
Aa (CAA) and listed them as a regulated source
category. This required EPA to implement a MACT standard to
limit mercury emissions from power plants,
hut it preferred a
cap-and-trade approach under Section
11
1
and so had to de-list
power plants as a source category.
In a separate bul related rulemaking issued yesterday in con-
junction with the utility mercury rule, EPA revised its Decemher
2000 finding and de-listed power plants as a source category,
allowing it to use the cap-and-trade approach.
EPA
esse~~tially
argued that it made a mistake hack in De-
cember 2000 and should not have listed
Dower ~lants as a source
category. The CAA
lays out specific procedures for de-listing
a source category, which EPA did not follow. But the agency
argues in the de-listing rulemaking that it can take such action
under another section of the law.
"Congress set up an entirely
different structure and predicate
for assessing whether utility units should he listed for regulation
under Section 112
. . .
[which] provides EPA significant discre-
Continued
on
page
2
/
iero-erntss~ons power pint lnibative, known as FutureGen.
/ 1
625
23-Jan
SF&
i8-F-b
3-Mar
,&Mar
1
3
250
.
.
.
Cop(righl'f 2005
Arg.s
Meoa LIU
-. . - . . . . . . . . . . . . . . . . . . . .
. .
ELECTRONIC FILING, RECEIVED, CLERK'S OFFICE, JANUARY 10, 2007
Argus Air
Daily
Volume
12,051,
March
16,2005
I
SO, trading once at $690, a $5 jump slnce yesterday and no
I
Argus AII Datly
,s
reevaluating 115 assessment of NO. prlces in 2009 EPA
f~nal~zed
its Clean Arr Interstate Rule March 10 whlch wlll replace the SIP
Cdll with afwo.t~ered trading scheme one for the summer ozoneseason
and one for the entlre year in the 28 states under CAIR. rlanlng in 2009
/
See methodology at end of report.
1
Continued from page
1
tion in making the appropriate and necessary tinding" and revis-
ing it, EPA argued in the de-listing mlemaking.
Once EPA established that it has the authority to de-list in the
manner it selected, it then argued that regulating power plants
under Section
112 is neither appropriate nor necessary since mer-
cury emissions will not pose a public health hazard to most of the
US population after reductions from the cap-and-trade approach
are achieved.
Environmental groups questioned
EPA's findings on the fu-
ture health hazards of mercury pollution, hut argued more direct-
ly that EPA does not have
the authority to utilize the alternative
de-listing approach that it selected.
Congress was clear when it amended the CAA in 1990 and re-
quired a MACT approach to control power plant mercury emis-
sions if their health impacts were found to he severe, Edwards
said. At best, Congress intended to give power plants a delay
from regulation and not an exemption, he added.
John
Stanton, senior counsel at Clear the Air, noted that
Page
2 of 7
ELECTRONIC FILING, RECEIVED, CLERK'S OFFICE, JANUARY 10, 2007
Argus Air
Dally
Volume 12,051, March 16,2005
EPA's approach for de-listing, which the agency did pursuant to
Section 112 (n) (1) (A)
01 the CAA, entails much more "broad
and nebulous authority'' than the usual approach under Section
112
(c) (9).
Under the rules of
slatutory construction, whenever a law has
a precise authority that says how to do something, it cannot be
over-ridden by something that is more vague, he said. EPA was
not available for comment.
The decision
to de-list power plants as a source category al-
lows EPA to proceed with the cap-and-trade approach for mer-
cury emissions, but more significantly it also allows EPA to
avoid controlling other hazardous air pollutants, including lead
and chromium, which form the vast majority of toxic emissions
from power plants and are arguably more dangerous than mer-
cury,
Stanton added.
EPA's final
mercuxy rule sets a two-phase cap
-
38 tons in
2010 and 15 tons in 2018 -and permits utilities to buy and sell
allowances to comply (AAD 3/15/05). Groups have 60 days after
the rule is published in the
Federal
Register to sue EPA. In ad-
dition to the Waterkeeper Alliance, Pennsylvania, New Jersey,
New York and Connecticut have also indicated they will sue.
Mercury rule retains coal rank bias
Complaints from bituminous coal-producers that
EPA's
pro-
posed mercury rule would create an uneven playing field ap-
pear to have fallen on deaf ears, as the agency unveiled a final
rule yesterday that is more favorable to sub-bituminous and
lignite coals.
EPA's mercury rule calls lor a 38-ton cap on emissions lrom
2010-2017 and a 15-ton cap from 2018 on, each to be met through
a cap-and-trade system (AAD 3/14/05). The contested allocation
of three times as many allowances to lignite coals and 1.25 times
to sub-bituminous as
compared with bituminous coals has not
been changed. EPA's unequal treatment of different ranks of coal
has already prompted the Pennsylvania Department of Environ-
mental Protection to threaten a challenge to the final rule (AAD
03/15/05). "No coal-type should be given an
mificial regulatory
or legislative advantage over another," agreed
Consol Energy,
the largest
US producer of bituminous coal, in a statement.
"Sometimes we take comments into account if we get a con-
sensus, but we did not get a consensus in this case," said Mary
lo
Krolewski, environmet~ltal engineer at EPA's Clean Air Markets
Division.
Worthem Appalachian and some Illinois Basin coals have a
higher mercury content than other
bituminous coals, although
they will he allocated allowances on the same basis. This will
particularly hurt facilities burning coal from central Pennsylva-
nia, which will have to achieve a much higher reduction than oth-
ers, said Thomas
Hewson, principal of consulting firm Energy
Ventures Analysis (EVA). Illinois has the highest risk exposure
to the new rule,
as while it already bums a lot of sub-bituminous
Powder River Basin
(PRB) coal, it does not have many scrubbed
plants, he added. Michigan and Ohio will also have to take action
to address their mercury obligations.
EVA is evaluating the potential costs of mercury control tech-
nologies necessary to meet the new requirements and will release
the results of the study later this month.
Companies
burning bituminous coals, particularly in Pennsyl-
vania, Illinois and Ohio, that do not already have plans to install
scrubbers, will be most at risk from the new mles, Hewson said.
For example. Reliant Energy's Keystone plant in Armstrong
County, Pa., has not announced any plans to fit scrubbers. Ac-
cording to EPA's Toxic Release Inventory the plant emitted
1,8001b of mercury in 2001, more than any other power plant
in the nation, while Pennsylvania had the highest mercury emis-
sions of any state.
Utilities burning lignites might be a little hit better off than
they were before,
Hewson said, adding "based upon initial tests
Texas should be in pretty good shape if mercury technology can
achieve projected performance." Texas is a heavy lignite coal
user and had the highest mercury emissions most years from
1998-2002, so will get the most allowances: 4.657 tonslyr in the
first phase and 1.838
tonslyr from 2018.
EPA tried to reflect the challenges of mercury removal in its
uneven allocation of allowances. While some bituminous coals
may have above-average mercury content, much of it is oxidized
during
combustion, particularly if the unit has a selective catalyt-
ic reduction (SCR) unit to control nitrogen oxides. Oxidized mer-
cury is water-soluble and can therefore be captured in a scrubber
for sulfur dioxide controls. Mercury is more difficult to remove
from sub-bituminous and lignite coals as more is emitted in the
elemental
form, of which little is removed by existing controls.
EPA has based the
Tint phase cap ofthe mercury rule on the as-
sumption that controls installed to comply with its Clean Air
lnrer-
state Rule (CAIR) for SO2 and NO, will bring mercury emissions
down to at least 38 tons as a result of these so-called co-benefits.
The agency projected 2010 emissions of 31.3 tons as utilities make
early reductions in order to bank allowances for the future. But the
mercury
will require further cuts even in the first phase ac-
cording to EVA, which is forecasting that co-benefits of the CAIR
rule will bring emissions down to 42 tons by 2010.
But states still have the discretion over allocation of allow-
ances to individual sources, and may not all follow EPA's pro-
posed compliance schedule attached to the rule based on historic
heat input. There is a danger that some states will allocate fewer
allowances to those facilities that have already announced or un-
dertaken SCR and scrubber projects than to those that have done
nothing.
The allowance allocations were based on the average
of the
highest three years of emission at the unit level from 1998-2002,
based on coal type input in 1999. EPA suggested that states
should use the years 2000-2004 to determine the baseline for
Continued on page 5
'. --:
, . ,
Page
3
of
7
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ELECTRONIC FILING, RECEIVED, CLERK'S OFFICE, JANUARY 10, 2007
Argus
Air Daily
Volume
12,051,
March
16,2005
Page
4
of 7
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ELECTRONIC FILING, RECEIVED, CLERK'S OFFICE, JANUARY 10, 2007
Argus Air
Daily
Volume 12,051, March 16,2005
Continued
from
page
3
whether a premium for low-mercury coal would develop as it
allowance allocation to sources, as they will have that data in
has for low-sulfur coal, as producers do not know
ii there is a
time to present their allocation plan to the agency by the Oct. 31,
consistency in mercury throughout a mine or seam that can he
2006, deadline, Krolewski said.
measured or controlled,
Blaney said.
An even ereater wild card is which states will
varticivate. New
a trading program to control a known neurotoxin, and repealing
its earlier findings that it
should he treated as a hazardous pol-
lutant
under a plant-by-plant technology-based standard. Local
and state air regulators' groups
STAPPAIALAPCO predicts that
7D.sz>:~<bz.2".L
Page
5 of 7
www.argusonline.com
many states will adopt their own programs as a result of what
they consider a weak rule, as well as states such as New Jersey,
unnrrype
I
~g
[lo4
lbil~wh)
I
~g ($oalbl~wh)
L,x,
,,.- .,, -"
I
--
I
,7"
Coal
1.1
1.4
'
~
1~.~~~th~~11~~~
~
~
~
d
~
~
SubbituminousSred(wet FGD'
Sub-bituminous fired (dly FGD)
,
jm-l,aG,aA
Connecticut and Massachusetts that have already done so.
?Anthraute units are included with bituminous
units.
I
Source:
EPA
"What is key is how many states will participate and whether
'
there will be an active market," said John Blaney of TCF Consult-
ing.
"If enough states opt out it may defeat the rationale for the
EPA's final rule has given new sources higher mercury
emis-
trading program, which is finding the most cost-effective way to
sions limits than they had in the December 2003 proposal, al-
make cuts." Krolewski conceded that "it could possibly impact
though they remain more lenient for sub-bituminous and lignite
the cost of the program
if states with larger budgets do not par-
coals. New sources burning lignite coals must not discharge
gas-
ticipate, but we could not be that predictive and assumed that all
es containing mercury in excess of 145 x
IbiMWh, more than
would." EPA has removed the originally proposed "safety valve"
double the originally proposed limit of 62 x
I
0-6 IhiMWh, while
of
$35,00Oflh at which allowances could have been bought from
the limit for bituminous coals has more than tripled to 21 x
future years' allocations, which may have significant implica-
IbfMWh. Sub-bituminous coal consumers with a wet scrubber
tions if few states participate.
must comply with a 42 x
IbfMWh limit, and those with dry
But if a viable trading program does develop, the
marginal scrubbers with a 78 x
IhlMWh limit, compared with 20 x
cost of scrubbers will decrease as a value is placed on the co-ben-
IbMWh as set out in the proposed rule.
efit reduction of mercury. At a given SO, allowance price, 10-20
New sources will be allocated only as many allowances as
pct more coal plants may be scrubbed than without the additional
they need, as long as they stay within their specified limits, from
incentive of gaining mercury allowances, Blaney predicts. But
a set-aside of initially
5
pet. After five years, when they will have
mercury will still not be as big a driver for installing controls
established a baseline, they may he able to overcomply and sell
as SO, and NO,, as even with allowance prices at
$30,00O/lb, their excess allowances.
it will only add somewhere between
$1-$3MWh onto the cost
of producing electricity, compared with
AEP estimates for SO,
at
$5.601MWh and $4.20fMWh for NO, at current allowance
Coal industry generally positive on CAlR
prices for a typical Central Appalachian coal-fired plant (AAD
3110105).
The coal industry reacted positively to
EPA's newly issued
PRB coal producers have a "critical window" to take ad-
Clean Air Interstate Rule, particularly Eastern coal
produc-
vantage of the current strong incentive to switch to PRB coals
ers who say the new regulations will make
Appafschian coal
presented by their lower sulfur content in light of increasingly
more
attractive to East Coast utilities.
stringent SO, limits, Blaney said. An additional
25Omn tonslyr
The new rnles will translorn coal-fired power plants into
of spare permitted capacity on top of the roughly
400mn tonslyr
clean sources of low-cost, reliable electricity,
Consol Energy
PRB output is available and in strong demand, but is constrained
said in a statement. The company said that while it would have
by an inadequate rail network.
preferred a statutory approach to the emissions standards, the
With prices for low-sulfur Eastern coals having risen to more
new rules
will continue to drive down emissions, ensuring that
than
$60iton from $30lton in the last three years and PRB coals
the nation's abundant coal resources can continue to be used to
still only around
$6-7/ton, there is a potential for PRB coal out- generate electricity.
put to grow even faster than the 5-6
pct increase seen last year,
EPA's mercury
rule will also drive the installation of emissions
Blaney said. But this incentive will go away as the large coal-
control equipment, said
Consol. "We expect that the two rules,
fired generators install scrubbers and switch back to high-sulfur
when taken together, will
result in a significant increase in the
coals; so the depletion of low-sulfur varieties becomes less of a
use of modem pollution control technologies to meet the lower
problem. Unless the railroads can resolve the bottlenecks, PRB standards for SO,, NO,, and the first-ever standards for mercury,''
coals may lose out
on this opportunity, he added. It is not clear
Consol said, noting that as the rules go into effect, the disparity be-
6
1
21
i
42
20
78
=,
I
4dx
ELECTRONIC FILING, RECEIVED, CLERK'S OFFICE, JANUARY 10, 2007
Argus Air Daily
Volume 12,051. March 16,2005
tween compliance and non-compliance coals will be eliminated.
''KO coal will he clean enough to he burned without emissions
reductions achieved with retrofitted modern pollution control
equipment or the purchase of emission allowances from units
that do install technology,"
Consol said. "As a coal's sulfur con-
tent becomes less of a concern (because of technology),
high-Btu
coals in the eastem US should become more attractive as a fuel
source to Eastern power plants because of those coals' lower de-
livered cost per Btu."
But the company warned that the mercury rule creates an
un-
level playing field by giving coal from some basins an unfair ad-
vantage over others. "No coal-type should be given an artificial
regulatory or legislative advantage over another. By keeping all
of America's coal resources available for use, this country can
take an important step toward energy independence."
Jack Gerard, chief executive of the National Mining Associa-
tion, said critics of the new mercury rule overlook its benefits.
"In addition to entirely overlooking the economic implications
from higher energy prices, critics who fault
EPA's
miss two
obvious points
-
this is the first rule ever designed to reduce
mercury emissions
irom these sources, and it will achieve im-
pressive reductions."
While compliance will be expensive for coal-fired power
plants, the proposed cap-and-trade system "will provide the na-
tion with lower mercury levels than would be possible on a
plant-
specific basis." The nationwide limits under cap and trade will
not expand to accommodate the operation of additional power
plants that
will be needed for generating the projected increases
in electric power.
The NMA echoed
Consol's call for a statutory approach to
emissions reductions, saying "Clear Skies legislation would still
be preferahle
-
it offers similar improvements in air quality but
would provide power companies with greater regulatory
cewain-
ty for building the new baseload capacity that is needed to fuel a
growing economy.
Ted Venners, chief executive of coal processing company
KFx, also expressed support for the new air rnles, while calling
for a nationwide legislative approach to the emission issue.
"We remain committed to helping the coal-fired industry com-
ply with these standards while calling on Congress to pass simi-
lar, nationwide legislation," Venners said. "The adoption of such
legislation would further drive the nation toward clean-energy
delivery and would provide additional clarity for the power in-
dustry as it implements measures to meet emissions standards."
DOE gives $48.7mn for clean coal projects
The Department of Energy today awarded $48.7mn in clean
coal grants to
32
research projech as part
of
the Bush ad-
ministration's zero-emissions power plant initiative, known
as
FntnreGen.
The projects focus on four key research area
-
the carhon
sequestration program area will fund eight programs, the power
systems advanced research program will fund eight; the coal
fuels and hydrogen project area
wiil fund 12 projects; and the
advanced gasification program area will fund four projects. Re-
searchers will also contribute
$13.7~11
towards the projects.
Projects
.
improved
will cover
andnew
a wide
methods
range of
of
topics,
producing
including:
pure hydrogen
in coal gasification;
hydrogen handling
-
safe storage of hydrogen, and on-
board storage which will aid the commercialization of hydrogen
fuel cell vehicles;
improved and simplified removal of multiple pollutants
in coal gasification;
development of carhon dioxide capture technology that
can he retrofit on existing coal-based power plants;
expansion of carhon sequestration technology to iden-
tify and accurately assess the CO, storage capacity of geologic
formations; and
development of new alloys to advance
ultra-supercriti-
cal generation with pulverized coal, an emerging newer technol-
ogy that can deliver power with ultra-low emissions and ultra-
high efficiency.
Committee backs greater ethanol use
The Senate Environment and Public Works Committee vot-
ed today to increase the proposed national renewable
fuels
standard included in the energy hill from 5bn gallonslyr to
6hn
gallonslyr of ethanol or biodiesel by
2012,
while elimi-
nating the federal oxygenate requirement for non-attainment
areas.
The legislation seeks to
ban the use of MTBE, a clean burn-
ing fuel additive that has caused groundwater contamination,
by 2010 and replace it with increased use of renewable fuels
such as ethanol and biodiesel to preserve the emissions benefits
of
mBE. Previous versions of the renewable fuels standard
(RFS) called for mixing 5bn gallonslyr of ethanol or biodiesel
into the gasoline supply by 2012, but the committee decided to
increase that amount, citing the rising production levels from
the ethanol industry.
"Today's vote clears the way for the Senate to make etha-
nol a cornerstone of America's energy policy," said Sen. John
Thu~ie (R-S.D.), who sponsored the legislation.
Relief
from the oxygenate requirement is sought by sever-
al states, including California, Louisiana and New York. Last
week, Sen. Dianne Feinstein
@-Calif.) asked EPA to speed up
consideration of her state's petition to waive the oxygenate re-
quirement so that it can use gasoline that does not contain etha-
nol, which the California EPA claims would increase emissions
of some
smog-fonning pollutants
(AAD
3110105). But the leg-
islation would still require the use of ethanol, so Sen. Barbara
Boxer
(D-Calif.), a member of the Senate committee, plans to
Page 6 of
7
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corn
ELECTRONIC FILING, RECEIVED, CLERK'S OFFICE, JANUARY 10, 2007
Argus Air Daily
Volume 12,051, March 16,2005
offer an amendment on the floor to exempt
California from the
new RFS.
"We do not believe we need it for clean air," she said.
To address some of those
concerns, the bill does include a
provision requiring EPA and other agencies to conduct several
studies on the air quality, economic and health impacts from the
RFS. EPA would also have to conduct an analysis to ensure that
areas are not "backsliding" on their emissions reductions as a
result of the use of ethanol or biodiesel.
By dropping the oxygenate requirement, ethanol producers
say the bill will let refiners use renewables in those areas where
it is most cost-effective while preserving the air benefits
froin
the current mandate. But refiners said they have "serious con-
cerns" about the increased ethanol mandate.
"A renewable fuels provision of
5bn gallonsiyr with a na-
tional averaging and credit trading
program would give refiners
improved flexibility in their use of oxygenates," the American
Petroleum Institute
(API) said.
API and the National Petroleum Refiners Association also
want the Senate to include "safe harbor" protection from law-
suits for MTBE manufacturers. The bill approved today does
not contain a safe harbor provision for MTBE,
but does for
ethanol. Previous versions of the energy bill were held up in
the Senate due to the inclusion of liability protection for
MTBE
producers.
March
17 Federal Register
Notices
Air programs: State imple-
mentation plans: adequacy
status for transportation con-
Oregon,
formity purposes
-
05-05325 [FRL-7885-11
Meetings: Clean Air Act
Advisory Committee,
05-05321 [FRL-7885-51
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