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BEFORE THE ILLINOIS POLLUTION CONTROL BOARD
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3 IN THE MATTER OF:
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4 NITROGEN OXIDES EMISSIONS ) R08-19
FROM VARIOUS SOURCE
) (Rulemaking - Air)
5 CATEGORIES: AMENDMENTS TO )
35 ILL. ADM. CODE PARTS
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6 211 AND 217
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8 Proceedings held on October 14, 2008, at 10:04 a.m., at
the Illinois Pollution Control Board, 1021 North Grand
9 Avenue East, Springfield, Illinois, before Timothy J.
Fox, Hearing Officer.
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Reported By: Karen Waugh, CSR, RPR
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CSR License No: 084-003688
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KEEFE REPORTING COMPANY
11 North 44th Street
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Belleville, IL 62226
(618) 277-0190
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APPEARANCES
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Board Members present:
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Board Member Andrea S. Moore
4 Board Member Thomas E. Johnson
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6 Board Staff Members present:
7 Anand Rao, Senior Environmental Scientist
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ILLINOIS ENVIRONMENTAL PROTECTION AGENCY
10 BY: Ms. Gina Roccaforte
Assistant Counsel
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Division of Legal Counsel
1021 North Grand Avenue East
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Springfield, Illinois 62794-9276
On behalf of the Illinois EPA
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BY: Ms. Dana Vetterhoffer
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Assistant Counsel
Division of Legal Counsel
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1021 North Grand Avenue East
Springfield, Illinois 62794-9276
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On behalf of the Illinois EPA
17 BY: Mr. John J. Kim
Managing Attorney
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Division of Legal Counsel
1021 North Grand Avenue East
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Springfield, Illinois 62794-9276
On behalf of the Illinois EPA
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21 HODGE DWYER ZEMAN
BY: Ms. Katherine D. Hodge
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Attorney at Law
3150 Roland Avenue
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PO Box 5776
Springfield, Illinois 62705-5776
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On behalf of IERG
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APPEARANCES (cont'd)
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ILLINOIS ENVIRONMENTAL REGULATORY GROUP
3 BY: Mr. Alec M. Davis
General Counsel
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215 East Adams Street
Springfield, Illinois 62701
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On behalf of IERG
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SCHIFF HARDIN LLP
7 BY: Ms. Kathleen C. Bassi
Attorney at Law
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6600 Sears Tower
Chicago, Illinois 60606
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On behalf of Midwest Generation
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INDEX
2 WITNESS
PAGE NUMBER
3 IEPA Panel
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Dr. James E. Staudt
4 Robert Kaleel
Vir Gupta
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(Questions from IERG)
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6 (Questions from Midwest Generation)
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(Questions from ExxonMobil)
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EXHIBITS
2 NUMBER
INTRODUCED
ENTERED
3 Hearing Exhibit No. 1
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Hearing Exhibit No. 2
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4 Hearing Exhibit No. 3
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Hearing Exhibit No. 4
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206
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PROCEEDINGS
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(October 14, 2008; 10:04 a.m.)
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HEARING OFFICER FOX: Having indicated that
4 she is ready, the court reporter allows me license to
5 proceed. Good morning, and welcome to this Illinois
6 Pollution Control Board hearing. My name is Tim Fox, and
7 I'm the hearing officer for this rulemaking proceeding
8 entitled "In the Matter of: Nitrogen Oxide Emissions
9 from Various Source Categories: Amendments to 35
10 Illinois Administrative Code Parts 211 and 217." The
11 board docket number for this rulemaking is R08-19. The
12 Illinois Environmental Protection Agency filed this
13 rulemaking proposal on May 9 of this year, 2008, and the
14 Board accepted it for hearing in an order dated June 5 of
15 2008.
16
Also present today from the Board on my immediate
17 right is Board Member Andrea S. Moore, who is the lead
18 board member for this rulemaking. At my far left is
19 Board Member Thomas E. Johnson, and also present at my
20 immediate left is Anand Rao of the Board's technical
21 staff.
22
Today we are of course holding the first hearing
23 in this rulemaking. The second is now scheduled to take
24 place beginning Tuesday, December 9 in Chicago. This
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1 proceeding is governed by the Board's procedural rules so
2 that all information that is not relevant -- that --
3 forgive me -- is relevant but is not repetitious or
4 privileged will be admitted into the record. Please note
5 that any questions that are posed today by the Board and
6 its staff are intended solely to assist in developing a
7 clear and complete record and -- for the Board's decision
8 and those questions do not reflect any prejudgment of the
9 proposal filed by the Agency.
10
For this first hearing, the Board on August 29 of
11 2008 reviewed -- received prefiled testimony from the
12 Environmental Protection Agency by Mr. Robert Kaleel,
13 from Mr. Vir Gupta and Dr. James Staudt. The Board has
14 received prefiled written questions for those witnesses
15 from Midwest Generation, from ExxonMobil and the Illinois
16 Environmental Regulatory Group, and on September 30 of
17 2008, the Agency filed its written responses to each of
18 those questions that had been prefiled earlier.
19
We will begin this hearing with the testimony --
20 the prefiled testimony of the Agency as the proponent in
21 this proceeding. The written responses are -- The
22 questions for the Agency's witness and the responses to
23 those are in the Board's record in this proceeding, and
24 we will then proceed question by question with any
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1 clarification or follow-up questions that the
2 participants may have.
3
I recognize that virtually all of you are
4 veterans of proceedings of this nature, but for the
5 benefit of the court reporter and for a record that is as
6 clear as possible, if you would please avoid speaking at
7 the same time as any other person. I don't think we'll
8 have any amplification issues in terms of making one
9 another heard, but if you would speak loudly and clearly
10 for her benefit, we will have the clearest possible
11 transcript.
12
What I would like to do -- It appears that all of
13 the participants who have prefiled questions are present.
14 What I would like to do is very briefly just to go off
15 the record, iron out a couple of fairly simple -- what I
16 believe are fairly simple details about the orders of
17 proceeding, and then we can reconvene almost immediately
18 and get underway with the substantive testimony. Any
19 questions in the meantime before we go off the record
20 briefly? Excellent. If we may do that.
21
(Off the record.)
22
HEARING OFFICER FOX: We're all set. In
23 going off the record briefly to discuss procedural issues
24 relating to the course of the hearing -- and I'm sorry to
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1 repeat that for those who are present here -- it was
2 determined that it was most logical to begin with the
3 prefiled questions submitted by the Illinois
4 Environmental Regulatory Group; to proceed then to the
5 prefiled questions from Midwest Generation that were
6 directed specifically to Dr. Staudt; at the conclusion of
7 the follow-ups to those, to proceed with the prefiled
8 questions filed by ExxonMobil; and ultimately to return
9 to Midwest Gen for follow-ups to those questions it had
10 filed specifically for Mr. Kaleel on behalf of the
11 Agency.
12
At this point it's appropriate, I think, to turn
13 to the Agency. In the hearing officer order I had
14 indicated that if the Agency wished to offer a brief
15 summary that that certainly would be in order. If you
16 would prefer to proceed to follow-up questions and
17 clarifications, that certainly seems like a productive
18 way to proceed as well. Do you have a preference,
19 Ms. Roccaforte?
20
MS. ROCCAFORTE: I think we're going to go
21 straight to questions, but I just had a couple of
22 procedural issues.
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HEARING OFFICER FOX: Absolutely. Go ahead.
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MS. ROCCAFORTE: I'm Gina Roccaforte,
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1 assistant counsel on behalf of the Illinois EPA. With me
2 today is Dana Vetterhoffer, assistant counsel, and John
3 Kim, managing attorney of the Air Regulatory Group, and
4 we are here representing the Illinois EPA. This
5 rulemaking is intended to satisfy Illinois' obligation
6 under Sections 172 and 182 of the Clean Air Act
7 pertaining to reasonably available control technology for
8 major stationary sources of nitrogen oxides in areas
9 designated as non-attainment with respect to the
10 eight-hour ozone and the PM2.5 national ambient air
11 quality standards. On March 24 the USEPA made a finding
12 that Illinois, among other states, failed to make a RACT
13 submittal required under Part D of Title I of the Clean
14 Air Act. I have copies of this and would like to move to
15 enter it as an exhibit.
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HEARING OFFICER FOX: Very well. If you can
17 distribute those to the participants, Ms. Roccaforte,
18 that would be great.
19
MS. ROCCAFORTE: This finding starts the
20 18-month emission offset clock, sanctions clock, and the
21 24-month highway funding sanctions clock and the 24-month
22 clock for the promulgation of a federal implementation
23 plan under the Clean Air Act. Therefore, Illinois is
24 required to submit a complete plan by September 24, 2009,
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1 so as to avoid the imposition of at least a two to one
2 offset requirement on new and modified sources for
3 emission units for which a permit is required under Part
4 D. As such, this rule proposed reasonable and cost
5 effective NOx controls on various source categories. The
6 proposed rule is expected to reduce NOx emissions by 46.3
7 percent or 20,666 tons per year beginning in 2010. I
8 would also like at this time to move to file as exhibits
9 the agency analysis of economic and budgetary effects of
10 the proposed rulemaking.
11
HEARING OFFICER FOX: Ms. Roccaforte, why
12 don't I address the first document that you had
13 circulated, and for the sake of the record, that is
14 Volume 73 of the Federal Register, pages 15416 to 15421,
15 entitled "Finding of Failure to Submit State
16 Implementation Plans Required for the 1997 Eight-Hour
17 Ozone NAAQS." Was there any objection on the part of any
18 of the participants to admitting that into the record as
19 Hearing Exhibit No. 1? Neither seeing nor hearing any
20 objection, it will be marked and admitted into the record
21 as Exhibit No. 1. Ms. Roccaforte, thank you for letting
22 me interrupt you.
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MS. ROCCAFORTE: Thank you.
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BOARD MEMBER JOHNSON: Speaking of volume --
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1 and I -- it's age compounded by allergies -- but if
2 you'll speak up a little for me, Gina.
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MS. ROCCAFORTE: Sure. As I was saying, I
4 would like to move now at this time to submit the agency
5 analysis of economic and budgetary effects of the
6 proposed rulemaking for Part 211 and Part 217.
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HEARING OFFICER FOX: Ms. Roccaforte, having
8 heard your motion, what I would like to do is divide it
9 into two parts since there are documents addressing
10 separate parts of the Board's regulations.
11 Ms. Roccaforte has moved to admit as Exhibit No. 2 the
12 analysis of economic and budgetary effects of the
13 proposed rulemaking with regard specifically to Part 211,
14 the definitions and general provisions. Is there any
15 objection on the part of any of the participants to
16 admitting that as Exhibit No. 2 in this proceeding?
17 Neither seeing nor hearing any, it will be so marked and
18 admitted into the record. And secondly, Ms. Roccaforte,
19 again dividing your motion, is there any objection to
20 marking and admitting as Hearing Exhibit No. 3 the
21 analysis of the proposed rulemaking with regard to Part
22 217 specifically addressing NOx emissions? Neither
23 seeing nor hearing any, it will be so marked as Exhibit
24 No. 3 and admitted into the record. Thank you,
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1 Ms. Roccaforte.
2
MS. ROCCAFORTE: Thank you. And with us
3 today from the Illinois EPA are Rob Kaleel, manager of
4 the Air Quality Planning Section, Division of Air
5 Pollution Control, Bureau of Air; Vir Gupta,
6 environmental protection engineer, Air Quality Planning
7 Section, Division of Air Pollution Control, Bureau of
8 Air; and also with us is Dr. James Staudt, president of
9 Andover Technology Partners. I'd ask that the witnesses
10 be sworn in at this time and we can begin answering
11 questions.
12
HEARING OFFICER FOX: Very good. If the
13 court reporter would swear the agency witnesses in as a
14 panel, please, we can proceed.
15
(Witnesses sworn.)
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HEARING OFFICER FOX: Thank you very much.
17 Ms. Hodge, it's time to turn to you, as it appears. You
18 had mentioned that you had some general questions that
19 you wished to raise before seeking specific
20 clarifications and follow-ups to the written answers that
21 were filed by the Agency. If it's -- you're prepared to
22 begin with those, why don't we turn things over to you.
23
MS. HODGE: Yes. Thank you so much,
24 Mr. Fox.
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HEARING OFFICER FOX: Certainly.
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MS. HODGE: My name is Katherine Hodge,
3 H-O-D-G-E, and I am with the law firm Hodge Dwyer Zeman,
4 and I'm here today representing the Illinois
5 Environmental Regulatory Group, and with me today to my
6 immediate right is Mr. David Kolaz, and Mr. Kolaz is a
7 consultant to IERG. Seated next to him, Ms. D.K. Hirner,
8 and she's the executive director of IERG, and then seated
9 to her right is Mr. Alec Davis, and he is general counsel
10 to IERG. Also in the audience today we have
11 representatives from several IERG member companies, and
12 as you said, Mr. Fox, I do have some general questions
13 for Dr. Staudt that I'd like to start with, and I'll just
14 get right to that, then.
15
Dr. Staudt, my first question is, does the cost
16 analysis that you conducted here include an estimate of
17 the amount of lead time necessary to plan, design,
18 finance, construct, implement and test the various types
19 of control technologies that you evaluated?
20
DR. STAUDT: Well, the analysis presented
21 here, the costs all incorporate -- are all based upon to
22 a large extent actual projects. The data that's been
23 collected are based upon real projects that have been
24 installed over a period of time. The TSD does not
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1 explicitly have a section that analyzes lead times for
2 specific projects, if that's what you -- that answers
3 your questions.
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MS. HODGE: Okay. Thank you. Based upon
5 your experience, what is a typical time frame that would
6 be necessary from the initial concept to implementation
7 and testing for these types of projects?
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DR. STAUDT: I -- For combustion
9 technologies like SNCR, it would typically be a --
10 perhaps about a year or less. For something like
11 selective catalytic reduction, which is a much larger
12 capital project, typically it would be longer than that,
13 but there may be differences from project to project or
14 from facility to facility that may change that.
15
MS. HODGE: Okay. Thank you. Have you
16 conducted any analysis to determine RACT for any of the
17 specific emission units that would be subject to this
18 rule?
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DR. STAUDT: Well, to -- if you're looking
20 at any particular unit or looking at the units -- the
21 characteristics of the Illinois units in general, we have
22 not examined -- done a unit-by-unit, case-by-case type of
23 analysis. We don't think that that's necessary, and I
24 think frankly it would be practically -- you know,
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1 impractical to do. To -- A more practical approach was
2 to look at the source categories by types, whether they
3 be industrial boilers, and the fuel types and combustion
4 characteristics, and then to examine what has been
5 achieved and what's been published relative to those
6 types of source categories, so we did consider the types
7 of source categories but we did not do a case-by-case
8 RACT.
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MS. HODGE: So in making --
10
(Off the record.)
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MS. HODGE: In performing your analysis
12 based upon the various industrial categories, did you
13 factor in the age of a particular unit? For example, did
14 you say in your analysis, well, I'm looking at an
15 industrial boiler that's twenty years old or that's ten
16 years old or five years old? Did that factor into your
17 analysis at all?
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DR. STAUDT: No, and I'll explain why. By
19 and large, many of these industrial boilers -- whether
20 it's ten years old, twenty years old or thirty years old,
21 many of them have been shown to live well beyond ten,
22 twenty, thirty years, so in terms of factoring that into
23 the analysis, it -- what I found is these boilers tend to
24 last a fairly long time, so, you know, what I think you
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1 might be getting at is saying, well, if a boiler has a
2 specific -- if you only expect a boiler to be around for
3 another five years, how does that affect the cost
4 analysis. Well, that -- in my experience, there -- these
5 boilers tend to last -- tend to -- even if they're twenty
6 years old, more often than not they can continue running
7 for another twenty years. Moreover, we don't have -- you
8 know, we did not look specifically unit by unit to do any
9 kind of analysis and ask the people, well, do you plan to
10 shut this down in five years. If someone plans to shut
11 it down in five years, that might be something to
12 consider.
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MS. HODGE: So it's your testimony, though,
14 that the age of the particular unit, let's say an
15 industrial boiler, would not have any impact on the cost
16 for the controls or on the technical feasibility?
17
DR. STAUDT: Well, it would -- it depends
18 upon what aspect of the age you're talking about. If
19 it's a -- In terms of the technical feasibility, I don't
20 see where it would necessarily have a factor on the
21 technical feasibility. In terms of the economic
22 volubility of the project, it potentially could if the
23 owner intends to shut the plant -- shut the facility down
24 in the near future, so -- but it's not for me to make --
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1 to say that an owner plans to shut it down in the near
2 future.
3
MS. HODGE: All right. Thank you.
4
MS. BASSI: While you are conferring, can I
5 ask one quick follow-up?
6
HEARING OFFICER FOX: Ms. Bassi, please go
7 ahead.
8
MS. BASSI: One of the questions that
9 Miss Hodge asked you was how long it -- the -- how long
10 it takes to construct and install some of this control
11 equipment, and I believe you answered that an SCR,
12 selective catalytic reduction equipment, would take
13 longer than one year. Could it take as much as four
14 years?
15
DR. STAUDT: That -- I am not aware of any
16 facilities where it's taken four years to do. I've
17 done -- I've -- A more typical number might be around two
18 years, but actually, I've seen some facilities as short
19 as a year, but for an SCR, you know, that -- using that
20 year is kind of about as short as it gets, but more
21 typical numbers would be close to two years for an SCR.
22 Four years, I can't say that no one has ever taken four
23 years to do it, but my guess is that they probably could
24 have done it faster. It's just that maybe they had other
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1 things going on that --
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MS. BASSI: Does your calculation of that
3 time period include obtaining financing?
4
DR. STAUDT: When I talk about the one year
5 or the two years, no, that does not include getting
6 financing.
7
HEARING OFFICER FOX: Yes, sir. If you
8 before going into your question would just provide your
9 name and --
10
MR. ELVERT: Yes.
11
HEARING OFFICER FOX: -- spell it for the
12 court reporter.
13
MR. ELVERT: Yes. Robert Elvert -- it's
14 spelled E-L-V as in Victor, E-R-T -- ExxonMobil.
15 Dr. Staudt, was any safety factors or requirements by
16 OSHA industry or other guidelines, requirements taken
17 into effect as to how long it may take to replace a unit?
18
DR. STAUDT: Well, in terms of -- I think
19 I've talked about how we treated the time, but the -- we
20 didn't explicitly look at time in the TSD, and so you can
21 tell from the TSD we didn't explicitly look at the time
22 frame. We were mainly looking at cost. From the context
23 of cost, all of the costs represented in the TSD are
24 based upon historical information, many of them actual
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1 facilities, and of course those cost numbers are based
2 upon actual facilities that were installed I presume
3 within OSHA requirements, or I hope they were all
4 installed within OSHA requirements and safety
5 requirements, so from the context of cost, that would
6 have been factored in. Unless you have -- If you have
7 something more, like, specific, unique requirements that
8 you want to explore, ask me about, I'm not sure what you
9 mean.
10
MR. ELVERT: Could they -- Could there be a
11 difference from industry sector to -- within the various
12 sectors within industry, is it a refinery, is it a
13 chemical plant, different than some other manufacturing
14 plant that you're aware of as far as safety type or
15 federal requirements, federal safety requirements?
16
DR. STAUDT: Well, yeah, there are some
17 different requirements at refineries, okay, but when
18 you -- what -- we did consider what -- you know, we
19 looked at the process -- we had a whole chapter on
20 process heaters, and from the perspective of process
21 heaters, the information on cost are based upon
22 information on process heaters which are used at
23 refineries. They're not used at power plants and they're
24 not used at other facilities. So in that perspective,
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1 assuming all of those process heaters that formed the
2 basis of the data that was relied on for the cost were
3 installed properly -- and I assume that they were --
4 they -- that would have addressed it from a cost
5 perspective. In terms of timing, as I said, I think I've
6 already addressed the timing question that you raised.
7
MR. ELVERT: Thank you.
8
MS. HODGE: Just a follow-up on the -- a
9 clarification on the timing. Again, you know, my
10 question related to planning, design and finance, and I
11 think you testified that you would not consider the
12 financing timing, construction and implementation. When
13 you talk about a year, is that from the time someone
14 starts construction? Is that from the time that they
15 would plan the project and then have to go seek a permit,
16 or could you just clarify a little bit what you mean by
17 the timing?
18
DR. STAUDT: Well, it could mean -- it
19 depends upon the technology, okay, but when I talk about
20 a year for -- for an SNCR system, it would typically be
21 under a year, I mean, on the outside for a selective
22 non-catalytic reduction system.
23
MS. HODGE: What would the start be?
24
DR. STAUDT: The start period would be -- it
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1 could very well be from the point of planning, even
2 before you file for the permit, and so -- but again, you
3 might -- you know, in many cases it might take longer
4 than that. In some cases it might take a year and a
5 half, but it's not going to be a three-year period for an
6 SNCR unless somebody's really working slowly or there's
7 some unusual situation, but --
8
MS. HODGE: Do you know what the lead time
9 is for some of these technologies?
10
DR. STAUDT: Yes.
11
MS. HODGE: Let's say I have a plant and I
12 would want to order one today.
13
DR. STAUDT: Okay. If you want to place an
14 order today, an SNCR -- I'll give you -- burners can
15 typically be done in less than a year, you know, from the
16 time you place the order, engineering, delivery,
17 installation. Of course one of the things you have to
18 factor in, one of the issues to some of these folks is
19 planning it within your normal outage cycle, okay? I
20 know that's a factor for many of the industries here. Of
21 course you want to factor that in to the extent you can.
22 For something like an SNCR system, same thing. It's
23 about -- It can be done within a year from the time you
24 place the order. That includes engineering, procurement,
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1 construction, mobilization, startup, testing,
2 commissioning, and turn over to the owner. An SCR
3 system, from the time you place the order, again,
4 typically within two years, okay, from -- you place the
5 order, that includes engineering, and you typically have
6 some -- you know, engineering, procurement, construction,
7 startup, you know, and, you know, the end -- you know,
8 commissioning and final acceptance testing. So that's
9 what you're looking at in terms of timing. Again, you
10 may want to plan it a little bit around your outage
11 schedule, which may cause you to accelerate things or may
12 cause you to move something back.
13
MS. HODGE: Okay. Did you factor in any
14 time for obtaining the construction permit, if such would
15 be necessary?
16
DR. STAUDT: Well, yes. I mean, in the
17 studies that I've done for EPA -- in fact, there's a
18 study that's referenced in the -- I did a study for EPA
19 we completed in 2002 on specifically all of this, and
20 that is timing for scrubbers, timing for SCRs, timing for
21 other control technology all relating to multi-pollutant
22 control, and we're focusing primarily on tail end
23 systems, and --
24
MS. BASSI: I'm sorry. What kind of
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1 systems?
2
DR. STAUDT: What I call tail end --
3 selective cat tail end system, not combustion controls.
4 Combustion control is typically faster, okay? For an
5 SCR, that's a bigger construction project so it takes a
6 little bit longer, but when I say two years for an SCR,
7 that includes, you know, the permit. It's -- What you --
8 Because what -- you can get the permit -- you can apply
9 for the permit and concurrently do engineering. You
10 don't buy equipment and you don't start doing
11 construction until you get the permit, but you can do
12 engineering while the permit is being processed.
13
MS. HODGE: And we're talking about the air
14 permit here.
15
DR. STAUDT: Talking about the air permit
16 and the construction permit, because you can't break
17 ground until you get a construction permit, but you can
18 do engineering.
19
MS. HODGE: Okay. And back -- a follow-up
20 on my prior question about would the age of a particular
21 boiler, you know, influence the types of controls. Would
22 there be any particular design characteristics of an
23 industrial boiler that could impact the economic
24 reasonableness and/or the technological feasibility?
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1
DR. STAUDT: Yeah. Well, in terms of the
2 economic reasonableness for sure, if there are some kind
3 of space constraint that makes it necessary to move a lot
4 of equipment around or do something that makes -- it
5 makes it very difficult -- obviously difficulty means
6 money, okay, so makes it much more expensive to install
7 the equipment, then it will affect -- impact the economic
8 reasonableness. Now, whether or not it affects technical
9 feasibility, the guides I've seen from EPA is that space
10 considerations by themselves are not -- do not make
11 something technically infeasible. It's really -- That
12 really tends to factor more into the economic
13 feasibility, because you can say, well, the process, yes,
14 can be treated with this technology, but it would be very
15 expensive to do it because they have to make these
16 modifications to the unit that costs a lot of money.
17
So space constraints have a tendency to factor
18 more into the area of economic -- what you call economic
19 reasonableness or the economics, as -- but potentially
20 could be -- affect the technical feasibility, but you'd
21 have to look at a specific -- if it has to do with the
22 process gas, that's really -- you know, the chemistry or
23 the process gas or something has more to do with the
24 technical feasibility.
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1
MS. HODGE: Okay. Thank you. I think -- I
2 believe you've testified that you did not do, you know,
3 specific analysis on the particular emission units to be
4 covered by this rule, but you are generally familiar with
5 the types of those -- types of units, aren't you?
6
DR. STAUDT: Oh, yes, yes.
7
MS. HODGE: Okay. Do you believe that there
8 could be a number of emission units subject to the
9 proposed rule that could not economically implement the
10 control technology you identify within the one-year or
11 less lead time?
12
DR. STAUDT: Well, you know, I -- nothing is
13 impossible, okay? I'll never say that nothing -- I'll
14 never say that it's impossible, but I would be
15 surprised -- I would have to look at what you're talking
16 about before I would say I agree or disagree, but just to
17 say a general statement, is it possible, perhaps, but
18 depending upon what it is, I might be -- you know, I
19 would be surprised.
20
MS. HODGE: So --
21
DR. STAUDT: If you're -- I don't believe
22 that anybody has to install an SCR to comply with this
23 rule, in my -- you know, I don't see -- I don't think
24 it's necessary, and so in most cases you're looking at
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1 boilers or SNCRs -- or rather -- excuse me -- combustion
2 controls or SNCR systems. I would be surprised if
3 someone needed to install an SCR to comply with this
4 rule.
5
MS. HODGE: Could you clarify on that and
6 just add a little bit of detail on why you believe that's
7 the case?
8
DR. STAUDT: Because the emission rates that
9 are in the rule are achievable and have been demonstrated
10 to be achievable with other control technologies that are
11 less expensive than SCR.
12
MS. HODGE: Do -- And do you mean combustion
13 controls?
14
DR. STAUDT: Well, combustion controls and
15 post-combustion controls like selective non-catalytic
16 reduction.
17
MS. HODGE: Okay. Thank you. The limits
18 proposed for industrial boilers in this proposal appear
19 to be among some of the most stringent in the nation.
20 What is the justification for such stringency, especially
21 for a coal state such as Illinois, and considering that
22 any additional controls will not be in place in time for
23 the effective compliance date of the ozone and fine
24 particulate standards?
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1
DR. STAUDT: That sounds like a question
2 that might be better directed to the Agency in terms of
3 the rationale for the rule, but I -- what I will say is
4 that there are other states that have far more stringent
5 rules than what's being proposed here, so --
6
MS. HODGE: Could you identify those
7 states --
8
DR. STAUDT: California.
9
MS. HODGE: -- let's just say for the
10 industrial boiler category?
11
DR. STAUDT: Certainly California. If you
12 look at Texas, down in the Houston-Galveston area, it's
13 far more stringent, so, you know, you're looking at other
14 cases where there's more stringent regulations, so -- for
15 industrial boilers.
16
MS. HODGE: Okay. Thank you. Are you aware
17 that within the state of Illinois that there are
18 circulating fluidized bed boilers that are as much as 24
19 years old and were not designed with SNCR in mind?
20
DR. STAUDT: I'm not aware of the age, but I
21 can tell you this much: I was in the business of selling
22 SNCR systems years ago, so I'm very, very familiar with
23 that technology, and so CFB boilers have unique
24 combustion characteristics that make them uniquely
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1 well-suited for selective non-catalytic reduction, and
2 whether they were built 24 years ago or not. They --
3 Essentially they were built with a time -- with a
4 residence time and a temperature and the gas and good
5 mixing characteristics, and that was before people
6 started putting SNCR systems on them. They're
7 basically -- The way they're built, they're well set up
8 for SNCR systems. I would be very surprised to see a CFB
9 boiler that did not perform very well with SNCR.
10
MS. HODGE: When you say that circulating
11 fluidized bed boilers can meet a 0.1 pound per million
12 BTU NOx limit, have you considered any potential
13 difficulties faced by retrofitting SNCR on the older
14 boilers where temperature and residence time are not
15 optimized?
16
DR. STAUDT: Well, again, as I stated
17 earlier, even before people were installing SNCR on CFBs,
18 CFBs were designed with specific combustion
19 characteristics, okay, even absent the existence of SNCR,
20 and those specific combustion characteristics, the
21 temperatures of the combustion, the exhaust gas and the
22 fact that you typically have a cyclone at the exit that
23 provides good mixing characteristics, but you also have a
24 fairly long residence time. That was before people were
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1 installing SNCR systems, and what we discovered is
2 that -- when we were selling -- when we were developing
3 the SNCR technology years ago is that CFB boilers that
4 weren't even built for SNCR technologies responded very
5 well to this technology because they had certain
6 combustion characteristics that lend themselves very,
7 very well to that technology, so even if you go back --
8 as I said, even if you go back 20 years ago -- and I was
9 in the SNCR business, I'm afraid, that long ago -- yeah,
10 CFB boilers were well-suited for SNCR.
11
MS. HODGE: Okay. Thank you. In Table 2-2
12 of the Agency's technical support document, this table
13 appears to for the most part include data from new
14 boilers. When you say that the emission limit can be met
15 without the use of flue gas recirculation, are you aware
16 that the boiler population in Illinois includes older
17 coal boilers that have been converted to gas-firing?
18
DR. STAUDT: Could you repeat the last part
19 of the question?
20
MS. HODGE: Sure. Are you aware that the
21 boiler population within Illinois includes some older
22 coal boilers that have been converted to gas-firing?
23
DR. STAUDT: Well, actually, an older coal
24 boiler that has been converted to gas-firing, generally
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1 that's probably even easier to retrofit, because a
2 furnace that's been designed for coal is going to be
3 bigger and is going to give you more time -- more -- it's
4 going to be bigger than one that's originally designed
5 for gas. That's just the way they're designed, because
6 with gas, you have to have lower gas velocities in a
7 coal-fired boiler because there's fly ash and things like
8 that and the combustion isn't quite as quick. Because of
9 that, it also gives you a lot more flexibility in terms
10 of what you can do with a boiler like that. An old
11 coal-fired boiler that is currently burning gas, it's
12 typically a field-erected unit. It's bigger, you
13 probably have the option for putting -- you have --
14 probably have room for overfire air, which you typically
15 would not have on a new gas-fired boiler because
16 they're -- generally a new gas-fired unit is more
17 compact.
18
But having said that, the data here is not all
19 for -- they're not all new units. It's a mixture of new
20 units as well as retrofits, and the attachment -- the
21 attached letter that has a more comprehensive list -- the
22 attachment to the TDS has a more comprehensive list and
23 actually identifies some of the retrofits, but you don't
24 find a big difference in the performance.
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1
MS. HODGE: Okay. Do you believe that such
2 boilers -- and by such boilers, I mean that -- coal
3 boilers that have been converted to gas-firing -- can
4 meet the 0.08 pounds per million BTU with or without flue
5 gas recirculation?
6
DR. STAUDT: Yeah. Without the flue gas
7 recirculation, they should be able to do it. 0.01, I
8 would say no. 0.01, you got to have flue gas
9 recirculation. 0.08, you can do it without flue gas
10 recirculation. Most of the current low NOx burners are
11 capable of achieving that level without flue gas
12 recirculation.
13
MS. HODGE: How would such an installation
14 use proper planning and boiler configuration as is stated
15 in the Agency's technical support document? Could you
16 just provide a few more details on that, please?
17
DR. STAUDT: Well, you know, essentially,
18 that's really boiler specific. You know, in terms of
19 planning -- in fact, if you could just direct me to the
20 page where that is, because I want to -- can you direct
21 me to the page where that's --
22
MS. HODGE: Sure. I'll try.
23
DR. STAUDT: I think it was a prefiled
24 question that referred to that, so I'm looking here.
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1
MS. BASSI: Mr. Fox?
2
HEARING OFFICER FOX: Yes, Ms. Bassi.
3
MS. BASSI: While they're looking, can I ask
4 a procedural question?
5
HEARING OFFICER FOX: Yes.
6
MS. BASSI: Was the Agency's testimony sworn
7 as written? I -- Did I miss that?
8
HEARING OFFICER FOX: They were -- All three
9 of them were sworn in as a panel and their testimony was
10 admitted as if read.
11
MS. BASSI: How about the responses to the
12 questions? Have those been accepted as testimony?
13
HEARING OFFICER FOX: Those have been filed
14 in effect, yes, as testimony before the Board.
15
MS. BASSI: So they have the weight of
16 testimony.
17
HEARING OFFICER FOX: Yes, they do.
18
MS. BASSI: Thank you.
19
HEARING OFFICER FOX: I'm sorry. I think I
20 may initially have misunderstood your question, but I
21 think we got to the answer.
22
MS. HODGE: Dr. Staudt, could you look at
23 page 13 of the TSD, please?
24
DR. STAUDT: Okay.
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1
MS. HODGE: It's down in the last paragraph.
2
DR. STAUDT: Yeah. Okay. Adequate -- yeah.
3 Planning -- okay. Well, part of that has to do with if
4 you're building a new boiler. Part of it had to do if
5 you were building a new boiler, you would actually plan
6 the boiler configuration. In the event of a retrofit,
7 you don't have the benefit of planning the boiler
8 configuration. You've got the boiler configuration that
9 you have to have. So in a retrofit, you do -- you've got
10 the boiler configuration you've got and you have to work
11 within the constraints of it. Most of these units that
12 they refer to in these Cleaver-Brooks studies, you can
13 see some of them are fairly small. It's much more
14 difficult with a small boiler, frankly, than it is with a
15 large boiler, because in the small package boilers, the
16 small ICI boilers, you don't have the space to do some of
17 the things you do on a large boiler. As I said, you
18 don't have the ability to put in overfire air.
19
If you're talking about an older -- you said a
20 26-year-old field-erected boiler that has now been
21 converted from coal to gas, you know, if someone were
22 building a gas-fired boiler today, to save money they'd
23 make it really tight and compact. For the purpose of NOx
24 control, they'd like to make it really big like that
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1 field-erected coal-fired boiler that's been converted to
2 gas, so what you really have when you have an older
3 boiler that has been converted to gas, you've got a
4 pretty good situation from the perspective of NOx
5 control, because you may be able to do other things like
6 adding overfire air and doing other things with staging
7 air that you would have a difficult time with a new
8 gas-fired unit, because a new gas-fired unit, the
9 constraints are actually more difficult because they try
10 to make them as small as possible to save space and cost.
11
MS. HODGE: Okay. Thank you. Does this TSD
12 include any information on such retrofitted boilers, and
13 if so, could you point us to --
14
DR. STAUDT: Sure. Go back to the -- We
15 talk about retrofitting boilers with -- retrofitted
16 industrial boilers with SNCR.
17
MS. HODGE: Is that coal-fired boilers?
18
DR. STAUDT: Coal-fired boilers. Here,
19 stoker -- Table 2-12b.
20
MS. HODGE: That have been converted to gas?
21
DR. STAUDT: Oh, converted to gas.
22
MS. HODGE: That have been converted to gas.
23
DR. STAUDT: No, I don't think it -- I don't
24 know that it does.
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1
MS. HODGE: Okay. Thank you. In response
2 to the prefiled question 18 of IERG -- and that question
3 was does the Agency believe that a larger than 250
4 million BTU per hour coal-fired boiler using Illinois
5 coal can meet a NOx limit of 0.18 pounds per million BTU
6 without SCR -- reference was made to Ameren's Sioux
7 unit 1. This unit is a utility boiler. Can you cite any
8 industrial coal boilers that are meeting a limit of 0.18
9 million -- 0.18 pounds per million BTU without SCR,
10 excluding CFBs?
11
DR. STAUDT: Okay. Let's go to -- if you go
12 back to near the -- it's on this cost effectiveness Table
13 2-17c on page 45, all right, and this is information, in
14 fact. You can look at -- If you look at coal-spreader
15 stoker, coal stoker, you can see units here, and
16 reference 1 is the 1994 ACT document, so it shows an SNCR
17 system on a coal stoker in the range of 0.15 to 0.18.
18 Now the reference 1, again, is the 1994 ACT. I would
19 venture to say that that document using data from close
20 to 15 years ago represents, you know -- we can do better
21 today than we could then, so, you know, there are -- you
22 know, the technology is there to provide the emissions
23 levels below 0.18, and particularly if you combine
24 combustion controls with SNCR, you can do better than
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1 that.
2
MS. HODGE: I'm having a hard time just
3 following. Can you point us to the exact lines on the
4 table --
5
DR. STAUDT: Okay. If you go to page 45, go
6 down along -- follow the -- you're talking about a stoker
7 boiler, right, as what kind of --
8
MS. HODGE: Yes.
9
DR. STAUDT: Okay. Go down to coal-spreader
10 stoker, okay, and coal stoker, all right? And you can
11 see the second one there shows with ammonia SNCR. It's
12 getting under 0.18 pound per million.
13
MS. HODGE: And what size was that boiler in
14 this example?
15
DR. STAUDT: It doesn't say. The
16 information wasn't available.
17
MS. HODGE: So we don't know that it's
18 greater than 250 million BTU, right?
19
DR. STAUDT: It's -- We don't know.
20
MS. HODGE: Okay. Is there one on this
21 table that is over 250 million BTU?
22
DR. STAUDT: Well, there's one that says 250
23 to 750, it says 0.22; however, with urea. Ammonia will
24 typically work -- may work better than urea, but, you
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1 know, 0.18 is certainly within the capabilities of --
2 without a doubt a combination of combustion controls and
3 SNCR.
4
MS. HODGE: So did you review any
5 information on boilers larger than 250 million BTU that
6 could in fact meet the 0.18? I mean, this says 0.22, and
7 my understanding is your testimony is that you think it
8 could meet the 0.18?
9
DR. STAUDT: Well, you just -- we just
10 talked earlier about anything over 250 million BTU.
11 Certainly there are utility units -- there are small
12 utility units as well that are able to achieve that.
13
MS. HODGE: What about for an industrial
14 boiler, though?
15
DR. STAUDT: Well, the data isn't as good --
16 to be honest, the data isn't published as much on
17 industrial boilers.
18
MS. HODGE: So --
19
DR. STAUDT: So -- But we do have this to
20 rely on, and we also have -- do we have -- I would like
21 to get back to you on that, because I've got some
22 references that I'm going to pull out for you.
23
MS. HODGE: And I think that would be
24 helpful for us, if you could do that, and just for the
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1 record, you know, my understanding of this table is that
2 the only unit that's greater than 250 million BTU, that
3 we're showing an actual limit of 0.22. Okay. In your
4 experience, have you found that a number of older
5 industrial PC boiler installations lack the space
6 necessary for advanced combustion controls?
7
DR. STAUDT: It depends upon the combustion
8 controls you're looking at. All of them can adopt
9 combustion controls. It depends upon which combustion
10 controls you're looking at. Many of them can't put in --
11 you know, they may not have the room for a separated
12 overfire air. Most can incorporate some form of overfire
13 air.
14
MS. HODGE: How would this affect your view
15 of RACT in such situations?
16
DR. STAUDT: Well, you know, I don't see
17 where it has a big effect except for the fact that as
18 we've incorporated into this, smaller boilers have a
19 tendency -- we've given smaller boilers higher emissions
20 levels than the large boilers, so that's why the utility
21 units have stricter limits than the industrial units over
22 250, which have a stricter limit than the industrial
23 units from 100 to 250.
24
MS. HODGE: Okay. Thank you. Could
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1 ammonium bisulfate also blind the bags in a baghouse and
2 corrode the baghouse internals?
3
DR. STAUDT: It potentially could, but the
4 way you -- but that's a matter of managing your baghouse
5 temperature. If you maintain your baghouse temperature
6 at the proper level, you won't have that problem. Where
7 that has been a problem is people who had leakages in
8 their baghouses and their baghouse temperatures dropped,
9 so if you maintain your baghouse temperature at the
10 proper temperature, it's -- you're not going to have that
11 problem. Potentially you could, but it's a matter of
12 managing your -- how you manage your facility and being
13 careful to keep your baghouse temperature adequately
14 high.
15
MS. HODGE: Thank you. If an SNCR system is
16 pushed beyond its capabilities by adding more and more
17 ammonia, would that exacerbate the formation of ammonium
18 bisulfate?
19
DR. STAUDT: It potentially could, but
20 these -- the limitations that we have here shouldn't make
21 that -- shouldn't cause that to happen, you know, if
22 you're -- unless you're operating the system improperly,
23 but these systems are designed to be capable of achieving
24 the emission rates that we're looking at here.
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1
MS. HODGE: Based on your experience, what
2 percent of the emission units identified as being subject
3 to this proposed rule will in fact be able to install the
4 necessary controls in the time frame currently dictated
5 by the rule and in the cost range that you've indicated?
6
DR. STAUDT: Well, as I stated earlier, I
7 think most of them are capable of doing it. We have not
8 looked -- In the TSD we did not explicitly have a section
9 examining time, but, you know, if you're looking at a
10 one-year time frame, potentially most of them could, but
11 again, you're looking at everybody installing it at once,
12 so, you know, that might -- that could present that
13 issue.
14
MS. HODGE: Okay. Did you consider the
15 impact of the use of SCR as MCR on wastewater discharges
16 and management of solid waste? For example, did you
17 consider cost and feasibility associated with additional
18 treatment of wastewater and/or disposal of pollution
19 control waste?
20
DR. STAUDT: Well, there isn't a wastewater
21 problem. I'm not sure what they're talking about. I've
22 been to lots of SCR systems and I -- lots of SNCR
23 systems, and I don't know what you're talking about.
24
MS. HODGE: So you're not aware of any
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1 wastewater problems.
2
DR. STAUDT: Well, what you're -- what you
3 may be getting at is the potential for ash -- ammonia
4 getting on fly ash. That's the only thing that I can
5 imagine that you might be getting -- looking at, for
6 people who wet process their fly ash, but an SNCR system
7 doesn't produce -- there isn't a wastewater stream as a
8 result of an SNCR system.
9
MS. HODGE: And I think you're correct. I
10 think with the management -- storage and management of
11 ash --
12
DR. STAUDT: Okay. So --
13
MS. HODGE: You know, I believe that most
14 people have permitted discharges associated with those
15 kinds of units.
16
DR. STAUDT: Yeah.
17
MS. HODGE: Did you evaluate, you know,
18 potential impacts there?
19
DR. STAUDT: Well, that's considered in the
20 cost analysis. You know, most of these facilities, you
21 know, these -- the cost estimates were not -- were based
22 upon the published information based upon real facilities
23 out there, hundreds of them that use these technologies,
24 and so in reality, there is a potential for ammonia to
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1 get on the fly ash, but there's a way of managing that.
2 The way you manage that is you design your system
3 properly, you operate it properly so that you don't have
4 high ammonia slip, and the degree to which you will have
5 a problem with ammonia on fly ash really depends upon a
6 number of things. One is how the fly ash is handled. If
7 it's handled in a dry manner, generally it's not a
8 problem. If you wet sluice it, there's a risk, depending
9 upon the actual chemistry of the fly ash. There may be a
10 slight ammonia odor, but again, it goes back to operating
11 your system properly and controlling that ammonia slip.
12 There are literally hundreds of these systems out there
13 and the businesses haven't gone out of business. They
14 still run these systems.
15
MS. HODGE: Are they all dry systems?
16
DR. STAUDT: Excuse me?
17
MS. HODGE: Are --
18
DR. STAUDT: I'm talking about SNCR --
19
MS. HODGE: Would their fly ash be managed,
20 then, as --
21
DR. STAUDT: No. I mean, there are systems
22 with wet systems that operate SNCR systems, and I work
23 with utilities who have SNCR systems and some of them
24 have wet sluicing systems.
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1
MS. HODGE: Okay. What about for industrial
2 boilers?
3
DR. STAUDT: Well, for industrial boilers,
4 it's exactly the same situation, okay? The chemistry
5 doesn't change. It's just that it's a smaller boiler.
6
MS. HODGE: Could you point us to where in
7 the TSD it discusses consideration of that kind of
8 information, you know, the cross-media impact?
9
DR. STAUDT: Excuse me?
10
MS. HODGE: Could you point to the location
11 within the Agency's TSD where there's information that
12 shows the consideration of, you know, the cross-media
13 impacts in your analysis?
14
DR. STAUDT: Well, we didn't explicitly
15 address what you call cross-media impacts. The fact is,
16 these are technologies that have been used at hundreds of
17 facilities. I mean, it's -- hundreds of facilities, if
18 not, you know, close to 1,000 facilities have SNCR; SCR,
19 again, close to 1,000 facilities to roughly 200 utility
20 coal-fired units as well as hundreds of other types of
21 facilities, and these what you're calling cross-media
22 impacts, this has been -- you know, this is something
23 people have been living with for years. They've -- It's
24 understood if people have -- know how to design these
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1 systems, they install them. It's not like we're talking
2 about, you know, the very first one, so the questions
3 that -- you know, the questions about these things are --
4 you know, it's as if this is some kind of newfangled
5 technology that's never been used. This has been
6 installed on hundreds of facilities worldwide.
7
MS. HODGE: No, my question is, is there any
8 information in this TSD that shows how that issue was
9 considered, or is this just for air pollution -- the cost
10 and the technology, is this just related to the air
11 pollution control aspects?
12
DR. STAUDT: We focus primarily -- We
13 focused on what the technology was capable of doing and
14 what the technology is shown to -- has shown to cost and
15 on facilities that have to think about this stuff, okay,
16 so while we did not explicitly have a chapter on
17 cross-media impacts, I guarantee you every one of these
18 facilities that has installed an SNCR system on a
19 coal-fired unit or an SCR system on a coal-fired unit has
20 thought about this, and that's captured in their costs,
21 their reporting costs.
22
MS. HODGE: Okay. You testified that you
23 guarantee that that's factored into the cost here.
24
DR. STAUDT: I'm telling you that it is --
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1 that the costs here are based upon reported costs for
2 the -- this equipment.
3
MS. HODGE: Okay.
4
DR. STAUDT: Okay. And these are real
5 people who use this stuff.
6
MS. HODGE: Thank you. Do you have any
7 follow-up? I have a couple more, but I don't know if you
8 had anything particular on this.
9
MS. BASSI: No, not yet.
10
MS. HODGE: Okay. Then I have just a couple
11 more questions. For EGUs, do you consider SCR or SNCR to
12 constitute RACT, or would it be beyond RACT?
13
DR. STAUDT: Are we getting to the prefiled
14 questions here? I think that was one of my prefiled
15 Midwest Gen questions.
16
MS. HODGE: Pardon me?
17
DR. STAUDT: This is identical to one of the
18 prefiled questions I got from Midwest Generating, so are
19 we going to go -- are we shifting over to prefiled
20 questions now?
21
MS. BASSI: You can answer it again. I
22 don't care.
23
MS. HODGE: Okay. We -- We'll -- I'll be
24 happy to wait.
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1
MS. BASSI: Okay. We'll wait.
2
MS. HODGE: Okay. Thank you. That's all
3 the questions that I have for Dr. Staudt.
4
HEARING OFFICER FOX: Of the general
5 questions you --
6
MS. HODGE: Of the general questions, yes.
7
HEARING OFFICER FOX: Very good. And,
8 Ms. Bassi, did I understand you to indicate that you had
9 some general questions as well following up on the
10 answers we've just heard, or did I misunderstand you?
11
MS. BASSI: No, I -- just one second. I
12 have one question in follow-up on one of Miss Hodge's.
13 You mentioned that there were more stringent rules for
14 NOx limits in California and the Houston area. Were
15 those adopted as RACT rules?
16
DR. STAUDT: I don't know if they were RACT
17 rules or not. They were -- They had to do with
18 attainment.
19
MS. BASSI: Okay.
20
DR. STAUDT: They had to do with attainment,
21 so from that perspective, there may be some similarity,
22 but they weren't -- they were attainment.
23
MS. BASSI: And this may not be a proper
24 question for you, Dr. Staudt, but for the Agency
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1 generally. Do you recognize that there is a difference
2 between a rule that is adopted for purposes of satisfying
3 a RACT, slash, RACM -- R-A-C-M -- requirement as opposed
4 to one that is adopted just for purposes of attainment?
5
DR. STAUDT: That might be better for the
6 Agency --
7
MS. BASSI: Yeah.
8
DR. STAUDT: -- because I've never heard
9 RACM before, so that's a new acronym for me.
10
HEARING OFFICER FOX: Ms. Hodge, should
11 we -- shall we turn to the prefiled answers to the
12 questions that were filed by IERG at this point?
13
MS. HODGE: Okay. But, now, these questions
14 go more generally to some of the agency witnesses and not
15 just Dr. Staudt.
16
HEARING OFFICER FOX: Yes, although they
17 appear to be to a large extent directed to Mr. Staudt --
18 or Dr. Staudt, or that Dr. Staudt would be the most
19 likely person to answer it. I'm sure the Agency's
20 witnesses will be available to supplement any answers. I
21 will just start, of course, with number 1. Recognizing
22 that there are four subparts to it, let me begin with
23 number 1 itself, which addresses the Agency's intent with
24 regard to switching fuel sources. Did IERG have any
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1 clarification or follow-up with regard to question 1 --
2 the answer to question 1 itself?
3
MS. HODGE: No, I do not.
4
HEARING OFFICER FOX: Does any other
5 participant have any follow-up to question 1 before we
6 turn to the subsections? Seeing none, Ms. Hodge, let me
7 turn to question number 1a regarding the Agency's
8 expectations with regard to fuel switching. Did IERG
9 have a follow-up or clarification in that regard?
10
MS. HODGE: No.
11
HEARING OFFICER FOX: None? Any other
12 participants? Seeing no response, sub b, 1b, regarding
13 the Agency's consideration of the availability of
14 alternative fuels, did IERG have follow-up or
15 clarification with regard to that?
16
MS. HODGE: No.
17
HEARING OFFICER FOX: Very well. Any other
18 participant? Seeing no indication that that is so, sub
19 c, number 1c, regarding the Agency's belief about the
20 feasibility of conversion, fuel conversion, any
21 follow-up, Ms. Hodge?
22
MS. HODGE: No.
23
HEARING OFFICER FOX: None? Any other
24 participants? Seeing no response, we'll turn, then, to
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1 the final subpart d regarding the conversion of boilers.
2 Ms. Hodge, any follow-up there?
3
MS. HODGE: No.
4
HEARING OFFICER FOX: Very well. Any other
5 participants? Seeing no indication that there is, we
6 will turn to question number 2, which regards agency
7 determinations regarding Illinois units that may be
8 affected by this proposal. A follow-up, Ms. Hodge?
9
MS. HODGE: No.
10
HEARING OFFICER FOX: None? Any other
11 participants? All right. Turning ahead, then, to number
12 3, the Agency's consideration of RACT emission limits
13 from other states, a follow-up, Ms. Hodge?
14
MS. HODGE: No.
15
HEARING OFFICER FOX: Any other participants
16 on question number 3 with clarification? None? Number
17 4 --
18
MS. HODGE: Excuse me.
19
HEARING OFFICER FOX: I'm sorry, Ms. Hodge.
20
MS. HODGE: Excuse me, Mr. Fox. I think I
21 would like to ask just a follow-up on question number 3.
22
HEARING OFFICER FOX: Please go ahead.
23
MS. HODGE: Could the Agency provide the
24 states -- the other states it did consider?
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1
MR. KALEEL: Yes, we can.
2
MS. HODGE: Could you do that today or would
3 that be something that you would do later?
4
MR. KALEEL: Yeah, we should be able to
5 provide that today.
6
HEARING OFFICER FOX: And --
7
MR. RAO: Could you just state for the
8 record what other states you considered?
9
MR. KALEEL: Yes. We've looked at -- and it
10 depends a little bit on which source category, but for
11 boilers, for example, we've looked at Wisconsin, Ohio,
12 Texas, south coast in California, Missouri, Indiana,
13 Pennsylvania and some of the northeast states.
14
MR. RAO: Thank you.
15
MS. HODGE: And do all of these other
16 states, do they have NOx RACT rules?
17
MR. KALEEL: I believe most of them have NOx
18 RACT rules. I think Dr. Staudt had already mentioned
19 that the limits in Texas and perhaps south coast were
20 adopted for other purposes, but I believe most of the
21 other states adopted them for the purpose of meeting NOx
22 RACT.
23
MS. HODGE: And are you aware, have they all
24 been approved as SIP revisions by USEPA, these RACT rules
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1 in these other states?
2
MR. KALEEL: It's my understanding that they
3 have been, or at least in most cases.
4
MS. HODGE: Thank you. Okay. That's all I
5 have. Thank you.
6
HEARING OFFICER FOX: Very good. Prepared
7 to turn to number 4, Ms. Hodge?
8
MS. HODGE: Uh-huh.
9
HEARING OFFICER FOX: Very good. Question
10 number 4 regardless -- regarding the Agency's awareness
11 of particular boiler sizes, Ms. Hodge, any follow-up on
12 your part for IERG?
13
MS. HODGE: No.
14
HEARING OFFICER FOX: Very well. Any other
15 participants? There is a subpart "a" also, Ms. Hodge, of
16 course, which I overlooked -- I apologize -- regarding
17 consideration of large boilers. Any follow-up to the
18 written answer?
19
MS. HODGE: No.
20
HEARING OFFICER FOX: Any other
21 participants? Seeing no indication, question number 5
22 does have five subparts. Let me turn to the base
23 question itself, Ms. Hodge, regarding the proposal as it
24 applies to gas-fired boilers of a particular size. The
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1 Agency has filed a written answer, "Yes." Is that
2 sufficient or do you have a follow-up?
3
MS. HODGE: That is, and quite frankly, I
4 don't have any follow-up on any of the subsets in
5 question 5.
6
HEARING OFFICER FOX: Thanks for helping us
7 move expeditiously. Of course is there -- I must check
8 if there's any other participant that would wish to
9 follow up with the answers provided by the Agency to
10 subparts "a" through "e" on question number 5. Seeing no
11 interest in that, Ms. Hodge, again, thank you for letting
12 us move to number 6 regarding uncontrolled emissions.
13 This question does have two subparts, but let us turn to
14 the base question, Ms. Hodge, if you have any
15 clarifications on that.
16
MS. HODGE: I do not, and again, not any on
17 the subparts.
18
HEARING OFFICER FOX: And of course,
19 Ms. Bassi, if you have a follow-up.
20
MS. BASSI: I do have some follow-ups on
21 this notion of the baseline, and perhaps they're not
22 direct follow-ups to question number 6 that IERG has
23 presented, but if we could get to the notion of baseline
24 and talk about that for a minute, I'd appreciate it.
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1 When the -- Is it the case that the baseline that the
2 Agency was using for this rulemaking is 2002?
3
MR. KALEEL: That's correct.
4
MS. BASSI: Okay. And -- Thank you. And so
5 as a baseline, what does that mean? What is the
6 baseline?
7
MR. KALEEL: For the purposes of planning
8 for ozone and PM2.5, I think of 2002 if not as a baseline,
9 at least as a base year, which is kind of an anchor point
10 both for developing emissions inventories, for planning,
11 and also an anchor for demonstrating reasonable further
12 progress, which is a separate requirement that the State
13 of Illinois needs to meet.
14
MS. BASSI: So as 2002 as the base year,
15 then if -- please correct me if I'm wrong -- as I
16 understand what you're saying is you look at the
17 inventory and determine what the emission levels are in
18 2002 and then that is the point from which reductions are
19 measured; is that correct?
20
MR. KALEEL: For the purposes of reasonable
21 further progress, that's correct, yes.
22
MS. BASSI: Okay. So does the baseline then
23 assume whatever control measures might already be
24 installed on a unit such as low NOx burners?
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1
MR. KALEEL: I guess I'm -- maybe we're
2 confusing uncontrolled emissions from baseline emissions.
3 Our inventory should reflect whatever controls were in
4 place at each and every unit in 2002. That -- We haven't
5 made a determination that those controls don't count from
6 a standpoint of meeting a RACT requirement. I mean, if a
7 company already has controls and that does figure into
8 the cost of complying with the RACT rule, that -- it's
9 really kind of mixing issues there from reasonable
10 further progress.
11
MS. BASSI: Thank you.
12
MR. KALEEL: In general, for reasonable
13 further progress, the non-attainment area as a whole, not
14 unit by unit, but as a whole must demonstrate reductions
15 to the level needed for attainment.
16
MS. BASSI: Thank you.
17
HEARING OFFICER FOX: Anything further,
18 Ms. Bassi?
19
MS. BASSI: No. Thank you.
20
HEARING OFFICER FOX: Surely. Were there
21 other participants that had follow-ups or clarifications
22 with regard to question 6 or any of its two subparts?
23 Very well. Ms. Hodge, we can move forward to question
24 number 7 regarding the Agency's evaluation of stoker
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1 boilers. Did IERG have a follow-up?
2
MS. HODGE: No.
3
HEARING OFFICER FOX: Any clarifications on
4 the part of other participants? Seeing none, we will
5 turn to question 8, which does have three subsequent
6 subparts. Question 8 addresses the Agency's belief with
7 regard to the feasibility of SCR. Follow-up on the part
8 of IERG, Ms. Hodge?
9
MS. HODGE: No, and again, not on any of the
10 subparts.
11
HEARING OFFICER FOX: And any other
12 participants? Seeing no follow-ups on question number
13 8 -- thank you again, Ms. Hodge -- we can turn to
14 question number 9 regarding the Agency's performance of
15 analyses. A follow-up, Ms. Hodge?
16
MS. HODGE: No.
17
HEARING OFFICER FOX: No? Any further
18 clarifications? Seeing none, question number 10
19 regarding the Agency's information gathering with regard
20 to retrofit controls. Ms. Hodge, follow-ups on that
21 issue?
22
MS. HODGE: No.
23
HEARING OFFICER FOX: Seeing none from IERG
24 or any other participant, let's proceed to question
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1 number 11 as filed by IERG. That addresses sources --
2 categories of emission units that do not now exist in the
3 area covered by the rule. Any follow-up, Ms. Hodge?
4
MS. HODGE: Yes.
5
HEARING OFFICER FOX: Please proceed.
6
MS. HODGE: Thank you. In response to
7 prefiled questions, the Agency responded to questions
8 concerning the inclusion of emission unit categories that
9 do not exist in the non-attainment areas or which are not
10 operational. Regarding emission units which do not
11 exist, your response alluded to the possible expansion of
12 the non-attainment area in the future. Based upon the
13 way the rule is written at this time, explicitly
14 specifying the geographical extent of the non-attainment
15 area, would the designation of a new non-attainment area
16 require a rule revision?
17
MR. KALEEL: Yes, it would, if -- in this
18 particular example we -- or question we referred to the
19 possibility of Massac County, Illinois, southern
20 Illinois, becoming non-attainment. Massac County is not
21 currently listed as one of the counties that this rule
22 would apply. If it does become non-attainment, we would
23 have to propose an amendment to the rule.
24
MS. HODGE: Thank you. In your response to
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1 the prefiled questions on this topic, you refer to Massac
2 County and Rock Island County as two examples of possible
3 areas that would be included in a rule, thereby
4 justifying inclusion of an emission source that exists in
5 Massac County but not in the areas currently covered by
6 the proposed rule. These areas that the USEPA is
7 proposing for non-attainment are in regard to the 24-hour
8 fine particulate standard, so my question is, how does
9 the averaging times and limits of the proposed rule
10 address the unique characteristics of this type of
11 violation?
12
MR. KALEEL: The -- I mean, it is a very
13 good point. The averaging times considered in this rule
14 are both annual and ozone season. They don't explicitly
15 address a daily standard. However, many of the controls
16 that are envisioned here, especially combustion controls,
17 they're either on or they're off, and we would expect
18 that these controls would help on a 24-hour daily basis
19 as much as seasonal or annual. There may be some
20 circumstances where that doesn't work, but --
21
MS. HODGE: Would the Agency have to do a
22 specific analysis there to determine whether these NOx
23 reductions would even be required?
24
MR. KALEEL: Well, there'd be a number of
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1 analyses that the State would be obligated to perform for
2 the 24-hour standard. As of now, there are no
3 non-attainments yet promulgated. The EPA hasn't
4 finalized those non-attainment designations yet. What
5 would be envisioned once an area or new areas become
6 non-attainment is that -- is to start a new planning
7 cycle, including evaluation of RACT, including reasonable
8 further progress and a demonstration of attainment, so
9 there would be a number of analyses that we would have to
10 look at. We would have to look again at this rule and
11 see whether or not it would exactly match the
12 requirements of the standard.
13
MS. HODGE: The Agency and the States of
14 Iowa and Kentucky have indicated that they disagree with
15 USEPA's proposal in this matter. Is there anything in
16 the Agency's analysis here of the emission sources in
17 these two areas -- and again, I'm referring to Massac
18 County and Rock Island County -- that indicate that the
19 imposition of the proposed NOx rule is necessary or
20 reasonable?
21
MR. KALEEL: I think it's our position today
22 that the exceedances or violations of the standards that
23 have occurred in Davenport, Iowa, and Paducah, Kentucky,
24 that Illinois sources did not contribute to that. That
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1 would speak to the conditions that have occurred for
2 present-day air quality from the standpoint that a future
3 analysis, a modeling analysis or future violations of the
4 standard that might occur before attainment is achieved,
5 it may change that conclusion, but our belief today is
6 that Illinois sources do not significantly contribute.
7
MS. HODGE: Thank you. Does the Agency
8 intend to purposefully include emission units that don't
9 exist in the non-attainment areas, and if so, what is the
10 basis for making this determination?
11
MR. KALEEL: I'm sorry. I'm not sure I'm
12 totally following your question.
13
MS. HODGE: In the NOx rule right now, what
14 is the basis for inclusion of these types of units; for
15 example, cement kilns?
16
MR. KALEEL: I think I attempted to answer
17 that. The -- At least to a certain extent, the inclusion
18 of those categories stem from two things. In the case of
19 aluminum melting furnaces, there was an aluminum melting
20 furnace in existence in Chicago in the initial inventory
21 year that we examined to identify units that may be
22 subject to RACT. That unit or that facility in Chicago
23 has since shut down. We don't know their intention as
24 far as potentially reopening, but as of now it is not
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1 open, and my understanding, it's surrendered its permit.
2 We have no indication they intend to open. We also have
3 no indication that they've torn the facility down or are
4 using it for some other purpose, so our preference is to
5 leave the limit where it is. In regards to cement kilns,
6 quite frankly, the existence of the emission limits stem
7 from the fact that when we initially drafted the rule,
8 the rule was going to be proposed as a state-wide
9 applicability, and there are other cement kilns in the
10 state of Illinois that are located in attainment areas of
11 the state. Subsequent modeling has shown that we don't
12 need to implement attainment area controls. The emission
13 limit for cement kilns was still there. We prefer to
14 leave it in the rule, again for the circumstance that
15 under the new ozone standard, under the revised PM2.5
16 standard, there may be some adjustments necessary to
17 non-attainment boundaries.
18
MS. HODGE: But didn't you just testify
19 that -- you said a rule revision would be necessary to
20 extend this out to areas other than the non-attainment
21 areas covered here?
22
MR. KALEEL: Yes.
23
MS. HODGE: Again, is there a basis to
24 include these kinds of units or cement kilns at this
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1 point in time if the rule revision would be necessary
2 anyway?
3
MR. KALEEL: Well, the -- I guess the
4 basis -- and maybe from your perspective it's not a valid
5 basis -- but the engineering work, the cost analysis has
6 been performed. The limits have been established. They
7 would send a clear message to units that potentially
8 become non-attainment in the future that they would know
9 what their target is, what it is they have to meet, but
10 there would be a rule revision needed. Your point is
11 well taken.
12
MS. HODGE: Did the Agency perform any
13 outreach related to its proposal here to owners/operators
14 of cement kilns located outside the non-attainment areas?
15
MR. KALEEL: Our initial outreach was really
16 geared towards state-wide application of the rule, so my
17 understanding is that at least some of the owners or
18 operators were aware of these requirements or at least of
19 our proposal.
20
MS. HODGE: Has the Agency received any
21 comments on its proposal here from owners/operators of
22 cement kilns?
23
MR. KALEEL: Not to my recollection.
24
MS. HODGE: Okay. That's all I have.
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1
HEARING OFFICER FOX: Ms. Bassi had a
2 follow-up.
3
MS. BASSI: Mr. Kaleel, I'm sorry. I didn't
4 hear what you said about the aluminum melter's permit.
5 Did you say that it has been surrendered?
6
MR. KALEEL: My understanding that it has
7 been surrendered, yes.
8
MS. BASSI: And so if permit has been
9 surrendered and particularly if some period of time has
10 passed since that point, would not the aluminum smelter
11 have to go through some sort of new source review in
12 order to reopen?
13
MR. KALEEL: In theory, yes.
14
MS. BASSI: Okay. Is it possible if that
15 were the case that the emission limitations on the
16 aluminum melter would be even more stringent than this
17 rule theoretically?
18
MR. KALEEL: Theoretically, yes.
19
MS. BASSI: Thank you. One other question.
20
HEARING OFFICER FOX: Go ahead.
21
MS. BASSI: When -- Were -- These sources
22 that have the potential of being located in future
23 non-attainment areas, when the rule -- when the Agency
24 pulled back the scope of the rule during its outreach
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1 process and -- to the non -- to the current
2 non-attainment areas, were these sources that are located
3 in potential future non-attainment areas notified of this
4 pullback so that they would believe that the rule was no
5 longer applicable to them?
6
MR. KALEEL: We did not make a specific
7 notification, like an e-mail or anything like that, to
8 all affected units, but we have done outreach. We've
9 made various presentations to various groups about what
10 our proposal includes. I'm quite certain we highlighted
11 quite plainly the change in the applicability from being
12 state-wide to just non-attainment area, and I feel
13 confident that we had sufficient outreach that people
14 were aware of that.
15
MS. BASSI: Thank you.
16
HEARING OFFICER FOX: Sure. Ms. Hodge, did
17 you have any further follow-up with regard to question
18 number 11?
19
MS. HODGE: No.
20
HEARING OFFICER FOX: Very well, and was --
21 I think we established that there were no other
22 participants that had follow-up with regard to 11. We
23 can turn, then, Ms. Hodge, to number 12 regarding IERG's
24 question regarding the definition of industrial boiler.
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1 There were two brief answers to the base question and the
2 single subpart. Did you have follow-up or --
3
MS. HODGE: I do.
4
HEARING OFFICER FOX: Please go ahead.
5
MS. HODGE: If a heat recovery steam
6 generator recovering heat from the exhaust of, A,
7 process, B, turban, or C, engine, is considered a boiler
8 for proposed -- for this proposed rule, then does the
9 Agency intend to define the boiler's rated heat input
10 capacity as a direct heat input to the heat recovery
11 steam generator from combustion of fuel in the heat
12 recovery steam generator -- for example, from a duct
13 burner -- or does it intend to also include the heat
14 input from the upstream process in the rated capacity?
15
MR. KALEEL: I'm not sure at this point I
16 have a specific answer. I think if it's okay, I'd prefer
17 to address that in writing. That sounds like a unique
18 circumstance.
19
MS. HODGE: That's fine. If the rated heat
20 input capacity of the boiler is intended to include
21 energy from the exhaust of an upstream unit, then how
22 does the Agency anticipate resolving the NOx emissions
23 and controls from the unit and from the heat recovery
24 steam generator?
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1
MR. KALEEL: I don't have a specific answer
2 to that right now. I think we'd prefer to respond to
3 that in writing.
4
MS. HODGE: Okay. Thank you. Is there any
5 language in the current proposal that the Agency
6 understands to resolve the regulatory status of upstream
7 units and heat recovery steam generators? If not, is the
8 Agency contemplating introducing language to clarify this
9 issue?
10
MR. KALEEL: It's possible that we need to
11 make some sort of a clarification.
12
MS. HODGE: If the Agency does intend to
13 regulate heat recovery steam generators as boilers, has
14 the Agency performed any analysis to determine either
15 technical feasibility or economic reasonableness?
16
MR. KALEEL: We have not performed any kind
17 of a unit-by-unit assessment. Again, if this is a unique
18 situation that you're describing, we've not done that.
19
MS. HODGE: Okay. Thank you. Thank you.
20 And then my final question, follow-up on this, is that
21 again, in this situation where you would have a heat
22 recovery steam generator, would that unit be regulated
23 under this proposal? And that's -- my understanding is
24 you're going to get back to us on that, but we're
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1 interested too in the interplay of regulation under the
2 proposed subpart Q for IC engine rules too. Would it
3 perhaps be regulated under subpart Q? Would it be
4 regulated here? Would it be regulated both places? I
5 think we just need clarification on that, please.
6
MR. KALEEL: Yes, we'd be happy to provide
7 that.
8
MS. HODGE: Okay. I do have a couple more,
9 please.
10
HEARING OFFICER FOX: With regard to 12?
11
MS. HODGE: Uh-huh.
12
HEARING OFFICER FOX: Please go ahead.
13
MS. HODGE: Okay. In response to prefiled
14 questions, the Agency mentions that it had not performed
15 an analysis of the technical feasibility or cost of
16 controlling heat recovery steam generators, cogen units,
17 chillers. Have these units been included in the estimate
18 of emission reductions included in Tables 10-1 and C-2 of
19 the technical support document?
20
MR. KALEEL: I'm sorry. We moved to
21 question 13? Is that just a follow-up --
22
MS. HODGE: No, we're still on 12.
23
MR. KALEEL: And I'm not aware that we've
24 done any specific analyses in regards to gas-fired
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1 chillers.
2
MS. HODGE: Okay. Thank you. Okay. That's
3 all I have. Thank you.
4
HEARING OFFICER FOX: Very good. Were there
5 any other follow-ups with regard to question 12? I know,
6 Mr. Kaleel, you've indicated a willingness to provide
7 some clarifications in writing, and I know -- I think
8 Ms. Hodge has indicated her appreciation. The Board
9 appreciates that willingness as well and looks forward to
10 that information. That would bring us, of course,
11 Ms. Hodge, to IERG's question number 13. Did you have
12 any follow-ups with regard either to the base question --
13
MS. HODGE: No.
14
HEARING OFFICER FOX: -- or the subparts?
15
MS. HODGE: I do not.
16
HEARING OFFICER FOX: You do not? Any other
17 participants? Sir, if you would before going to your
18 question please provide the court reporter with your name
19 and spelling and any organization you might represent.
20
MR. DENNIS: It's Pat Dennis, D-E-N-N-I-S.
21 I'm with ADM. And point of clarification, the answer to
22 13 says, "If refrigerant is heated directly by gas
23 firing, it's a process heater," and I'm wondering if the
24 Agency meant to say indirectly there, because a
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1 process -- to be a process heater, the unit should
2 incorporate indirect heat transfer rather than direct
3 heat transfer.
4
MR. KALEEL: I think you're right, that it
5 meant indirect heating.
6
MR. DENNIS: That's all I have.
7
HEARING OFFICER FOX: Very good. Thank you,
8 sir. Any further questions on IERG's question number 3?
9 Any clarifications?
10
BOARD MEMBER MOORE: 13. You said 3.
11
HEARING OFFICER FOX: I jumped back ten
12 questions. Questions number 13. My mistake. I
13 apologize. That brings us, Ms. Hodge, to question number
14 14, which does have five subparts. Why don't we begin
15 with 14a based on -- regarding implementation. Did you
16 have a follow-up or clarification?
17
MS. HODGE: I do have several follow-up
18 questions, and some of the questions cover, you know, one
19 or more of the subsets, so --
20
HEARING OFFICER FOX: It's difficult to
21 tease them apart. Why don't we go ahead with your
22 questions, and certainly any other questions we'll
23 entertain in due time.
24
MS. HODGE: Okay. In response to prefiled
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1 questions, the Agency has stated that the compliance date
2 for the proposed rule of May 1, 2010, is one year later
3 than USEPA requires in its final rule to implement the
4 eight-hour ozone national ambient air quality standard.
5 Since for all practical purposes the compliance date
6 occurs too late to impact compliance with the ozone
7 standard, what benefit will the proposed rule have in
8 achieving compliance with the current ozone standard?
9
MR. KALEEL: Hopefully the area will achieve
10 attainment at the time frame that is required -- which is
11 2009, slash, 2010 -- with control measures that are
12 already being implemented. The NOx RACT proposal is a
13 specific requirement of the Clean Air Act regardless of
14 how much it contributes to attainment. It is a specific
15 requirement that must be addressed, and this proposal is
16 intended to address it.
17
MS. HODGE: Okay. Thank you. If the Agency
18 needs an extension of time to attain the ozone standard,
19 what are the requirements it must meet to qualify for an
20 extension, and in your opinion, how will the May 1, 2010,
21 compliance date impact USEPA's decision to grant an
22 extension?
23
MR. KALEEL: I guess I'm not aware that
24 there's a specific mechanism to seek an extension of an
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1 attainment date for ozone. There is a provision for
2 achieving an extension of the attainment date for PM2.5.
3 If we fail to meet the attainment date for ozone, I
4 believe the Clean Air Act would provide for a bump-up to
5 a higher classification, and in so bumping up the area to
6 a higher classification, we would also have a later
7 attainment date, I believe three years later, if the area
8 goes from moderate to serious. The NOx controls in 2010
9 could still potentially help to keep the area in
10 attainment.
11
The -- And perhaps the extension that you were
12 referring to, the Clean Air Act does provide for one-year
13 extensions if the area is achieving clean air in the
14 first of the -- of three years. The -- Back up for a
15 second. To be able to determine whether or not the area
16 is attained, three years of clean monitoring data must be
17 observed or measured in the non-attainment area, so
18 presumably the first clean year would be 2009, and as you
19 pointed out, we would not have full implementation of NOx
20 RACT in 2009. If we make it -- If the meteorological
21 conditions are right, if other control measures are
22 helping to achieve clean air in 2009, we can request an
23 extension to 2010 and then again till 2011, so even
24 though NOx RACT might not help us in that first year,
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1 implementation by the ozone season of the second year of
2 at least most of those controls would help to keep the
3 area on track to attain the standard, and again in 2010
4 and in '11, so maybe those were the extensions that
5 you're referring to.
6
MS. HODGE: Yes. Yes, they were. Okay.
7 The fine particulate standard attainment date is April
8 14, 2010. According to the USEPA, what is the date by
9 which RACT control measures must be in place for fine
10 particulate control purposes?
11
MR. KALEEL: For fine particulate, the --
12 well, I guess it's similar to what it is for ozone. The
13 RACT is intended to be achieved by the year that
14 attainment is also to be reached, so in that specific
15 instance, April of 2010 would be the attainment -- or the
16 compliance date under the federal guidance.
17
MS. HODGE: Okay. What are the USEPA
18 requirements for qualifying for an extension of time to
19 attain the fine particulate standard, and in your
20 opinion, how will the May 1, 2010, compliance date impact
21 USEPA's decision to grant an extension? And again, this
22 is on the fine particulate.
23
MR. KALEEL: The requirement for achieving
24 an extension for PM2.5, the State needs to make a
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1 demonstration that control measures needed for attainment
2 could not be implemented in time, that there was some
3 reason why feasible control measures could not be
4 implemented in time by 2010.
5
MS. HODGE: Thank you. In your opinion, is
6 the rule's compliance date a factor to consider in the
7 overall determination of whether RACT is reasonably
8 available in a specific situation?
9
MR. KALEEL: Obviously the State intends to
10 have a compliance date that can be reasonably achieved,
11 and from our standpoint, again, it depends on the
12 duration of the rulemaking as to how much time would
13 still be available. I think we believe -- and I've
14 responded to some of the questions here in a like
15 fashion -- we believe that in most cases there is still
16 enough time for companies to comply. There are
17 undoubtedly and we are aware of some circumstances where
18 that might not be true, and we remain open to discussing
19 those unique circumstances. If the rulemaking process
20 becomes very protracted, then there's certainly an
21 obligation that we would have to work with the Board and
22 work with affected industries to derive or determine a
23 more reasonable compliance date.
24
MS. HODGE: Thank you. Do you believe that
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1 the rule's compliance date can potentially impact the
2 availability of a control technology and the cost of
3 implementing the technology?
4
MR. KALEEL: At least a portion of that,
5 perhaps it would best be addressed by Dr. Staudt. I
6 guess our opinion is we're not to that point yet. We
7 believe that the control measures that are needed to
8 attain are reasonably available at the present time,
9 so --
10
MS. HODGE: Thank you. And I know we hit on
11 this a little bit earlier in questions for Dr. Staudt.
12 Would you have anything to add --
13
DR. STAUDT: No.
14
MS. HODGE: -- at this time? No? Thank
15 you. Has the Agency considered the impact that current
16 economic conditions will have on financing procurement,
17 construction and timing for the kind of projects required
18 by this rule?
19
MR. KALEEL: We read the newspapers. We
20 know it's a difficult time right now. Hopefully that
21 will be resolved for all of us. I don't have a specific
22 reaction to availability of credit right now, but I
23 haven't tried to obtain a home mortgage or buy a car
24 recently, so I can't really directly respond to what --
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1
MS. HODGE: So the Agency has not considered
2 the current economic impact?
3
MR. KALEEL: We have not, no.
4
MS. HODGE: Okay. Thank you. Also, in
5 response to question 14c, the Agency made a statement
6 that the Illinois EPA believes that stakeholders have
7 already had ample time to plan and design the control
8 measures needed to comply with this proposal since
9 they've been aware of it for several years. Can you just
10 provide a little bit of an overview for the Board about
11 how this rule has changed over the last several years
12 from maybe some of your early initial outreach to the
13 proposal that you have before the Board right now?
14
MR. KALEEL: Sure, and the Agency has worked
15 with stakeholders for a number of years and we've made
16 presentations and had meetings to IERG and its members
17 and to other groups as well. The obvious -- The biggest
18 obvious change that has occurred with the proposal from
19 its inception was pulling back on the requirement for --
20 or at least our initial ideas or thoughts about making
21 this state-wide rulemaking. There may have been some
22 other specific changes, I believe, in certain
23 circumstances that a certain emission limitations have
24 been relaxed somewhat, although I think for the most part
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1 the emission limits that we originally stated a couple
2 years ago are still contained in this proposal. But
3 another change that I know has come about, and perhaps
4 not just strictly as a result of outreach but just the
5 evolution and the duration of the time to make this
6 proposal, is pushing back the compliance date. I believe
7 we originally proposed 2009 to match up with the federal
8 requirement. We have pushed it back a little bit, but --
9
MS. HODGE: All right. Thank you. So as
10 you just testified, one of the big changes was change of
11 the rule from state-wide applicability to applicability
12 just in the non-attainment areas. Does the Agency think
13 that it would have been a prudent business decision,
14 then, for a facility located in an attainment area to
15 move forward with controls let's say 18 months ago?
16
MR. KALEEL: Probably not a prudent decision
17 to go ahead with implementation of controls. I think
18 what we intended here is to, again, make the Board and
19 make -- state the obvious fact that companies have been
20 aware of these limits. There are a certain amount of
21 planning undoubtedly that goes on internally within each
22 of the companies as far as what control measures may be
23 needed, so there is some up-front work that could be done
24 short of applying for a specific construction application
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1 or initiating controls, you know, spending significant
2 capital down there for construction of equipment, so I
3 think there's a fair amount of up-front work that could
4 be done and probably has already been done by a number of
5 companies.
6
MS. HODGE: And how familiar are you with
7 business planning for capital expenditures?
8
MR. KALEEL: I don't have a great deal of
9 familiarity with that.
10
MS. HODGE: Would you think that it would be
11 routine to go forward with approval for capital for a
12 proposed rule?
13
MR. KALEEL: I don't think it would be
14 routine to actually obtain loans or to let contracts. In
15 fact, in terms of letting contracts, that may even
16 violate our permitting requirements.
17
MS. HODGE: So is it the Agency's position
18 that you think companies shouldn't move forward with
19 planning and design for a proposed rule?
20
MR. KALEEL: I think in many cases they
21 could have done that. I think we certainly know there's
22 been enough planning that has gone forward within the
23 companies to provide negative feedback to our proposals
24 as early as a couple of years ago, so we know that people
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1 have been looking at it. They've already been aware of
2 what we're asking for and at least were prepared enough
3 at the time to say that they didn't think it was
4 feasible, so just even making that statement would make
5 me think they've been doing some planning.
6
MS. HODGE: Okay. Thank you. I think
7 that's all that I have on 14.
8
HEARING OFFICER FOX: Very well. Were
9 there -- Ms. Bassi?
10
MS. BASSI: I won't ask my questions. Not
11 nice.
12
HEARING OFFICER FOX: Did you have another
13 nicer one that you wanted to pose?
14
MS. BASSI: No. Miss Hodge covered them.
15
HEARING OFFICER FOX: Very well. Yes,
16 Mr. Elvert.
17
MR. ELVERT: Yes. One of the questions that
18 Mrs. Hodge asked was do you believe that the rule's
19 compliance dates can potentially impact availability of
20 control technology. In the past we've only been talking
21 about boilers and process heaters. Is this -- Is your
22 answer the same in regards to part 75 and part 60, CEMS
23 equipment?
24
MR. KALEEL: I'm not aware of the current
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1 availability or lack of availability of monitoring
2 equipment.
3
MR. ELVERT: Okay. Thank you.
4
HEARING OFFICER FOX: Thank you, sir. Any
5 further questions with regard to question -- IERG's
6 question number 14? Ms. Hodge, why don't we proceed to
7 IERG's question number 15 with regard to emission
8 averaging plans. It does have three subparts. Would it
9 make sense once again perhaps to address those in effect
10 together?
11
MS. HODGE: Yes.
12
HEARING OFFICER FOX: I suspect that you
13 have some follow-ups.
14
MS. HODGE: Thank you.
15
HEARING OFFICER FOX: Please go ahead.
16
MS. HODGE: Mr. Kaleel, in response to the
17 prefiled questions, the Agency stated that new units
18 subject to the rule cannot be included in emission -- in
19 an averaging plan because of the need to track emission
20 reductions from the 2002 base year. Are there USEPA
21 guidance or policy documents that preclude the Agency
22 from allowing averaging of the newer units?
23
MR. KALEEL: I'm not aware of anything in
24 the federal guidance with regard to including or not
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1 including averaging. The concept of averaging was
2 something that was brought to us by stakeholders as a
3 means of providing flexibility towards compliance.
4
MS. HODGE: Thank you. Given the potential
5 for a facility to make important energy efficiency
6 decisions that could be adversely impacted by this
7 exclusionary limitation, has the Agency considered any
8 methodology that could be employed to address their
9 concern, allow such averaging -- that would be such
10 averaging of post-2002 units?
11
MR. KALEEL: The one circumstance that the
12 proposal does allow in terms of averaging is in the
13 context of a replacement unit. We certainly envision
14 that a new unit would be more efficient -- or certainly
15 conceivable to us it would be more efficient than the
16 existing one, and I don't -- at least in terms of
17 replacement, the rule allows for that.
18
MS. HODGE: Is the term replacement unit
19 defined anywhere in the proposed rule?
20
MR. KALEEL: I don't recall if we've
21 specifically defined it.
22
MS. HODGE: Okay. And in your answer to
23 15c, I think the Agency said for the purposes of emission
24 averaging under this proposal, a replacement unit must be
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1 essentially the same as the unit it replaces.
2
MR. KALEEL: Yes.
3
MS. HODGE: Are you aware of any industry
4 that would routinely do replacement in kind? Wouldn't
5 there be some kind of improvement or enhancements?
6
MR. KALEEL: Well, the averaging concept
7 originally was put forward by the natural gas pipeline
8 folks in the development of subpart Q, the engine rule.
9 What they envisioned was a replacement of a gas-fired
10 engine perhaps with an electric engine. Again, that
11 would be alleviating all emissions, and we did allow for
12 replacement of a unit that has emissions with one that
13 has no emissions at all, so that -- I mean, that
14 obviously makes sense, but the concept was that that
15 engine does the same job as the one it replaced, and what
16 it was providing was an air quality benefit.
17
MS. HODGE: So could you -- could we
18 consider a definition that replacement unit would be
19 doing the same job as the unit it replaces?
20
MR. KALEEL: I think that's consistent with
21 our intent. If -- Just throwing out an example, if a
22 company wanted to replace a 100 million BTU boiler with a
23 100 million BTU boiler, that certainly is consistent with
24 our intent of what is a replacement unit.
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1
MS. HODGE: Okay. Thank you.
2
MS. BASSI: Can I follow up on that, please?
3
MS. HODGE: Sure.
4
HEARING OFFICER FOX: Please go ahead,
5 Ms. Bassi.
6
MS. BASSI: I have two questions, I think,
7 in follow-up, in following up on that. The first one is,
8 you said if they could replace a 100 million BTU boiler
9 with a 100 million BTU boiler. Could they replace it
10 with a 150 million BTU boiler?
11
MR. KALEEL: I don't have a specific
12 threshold in mind. Again, I think what we are thinking
13 is it's essentially doing the same work as the unit that
14 it replaced, and if you could play that game back, what
15 about 149? What about 139?
16
MS. BASSI: Right.
17
MR. KALEEL: We don't have a specific
18 criteria in mind, but again, the --
19
MS. BASSI: So I have more than one
20 question, more than one question on that. Is this then
21 something that would be determined in the permitting
22 process, or exactly where?
23
MR. KALEEL: I think there's some discretion
24 involved. I think we would intend for companies to
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1 propose in an averaging plan what it is that they have in
2 mind, but --
3
MS. BASSI: Is the replacement unit -- or
4 could the replacement unit effectively be viewed as
5 the -- as one of the company's methods of complying with
6 the rule; in other words, by replacing an old unit with
7 one that's more efficient in terms of emissions, then
8 that that is its compliance methodology?
9
MR. KALEEL: I could conceive, again going
10 back to the engine rule example, that if a company wanted
11 to use an electric engine rather than a gas-fired engine,
12 it made sense for them to do that both from an efficiency
13 standpoint and from an emissions standpoint, that
14 certainly that that's what we envisioned, and a
15 replacement of a dirtier unit with a clean one is -- we
16 would encourage that.
17
MS. HODGE: Just a quick follow-up on that.
18 So would the Agency entertain a proposal from IERG in
19 that regard consistent with your testimony here today?
20
MR. KALEEL: We'd be happy to discuss it,
21 sure.
22
MS. HODGE: Okay. Thank you.
23
HEARING OFFICER FOX: With regard to
24 question number 15, Ms. Hodge, any further questions?
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1
MS. HODGE: No.
2
HEARING OFFICER FOX: No? And from any
3 other participant, Ms. Bassi or otherwise, on question
4 number 15? Noting the time, we have been at it for
5 nearly two hours, and I appreciate your stamina. It
6 certainly seems that there's time for lunch. Why don't
7 we take a break and resume here at 1 o'clock. We can
8 begin, Ms. Hodge, with question number 16 on IERG's part,
9 and that will turn to some questions that appear to
10 relate very specifically to Dr. Staudt's prefiled
11 testimony, and we can wrap up the questions and answers
12 from IERG. And with that, we can go off the record and
13 I'll see you -- we'll see you back here at 1 p.m.
14
MS. HODGE: Thank you.
15
(One-hour lunch recess taken.)
16
HEARING OFFICER FOX: We're at the end of
17 our lunch break at 1 a.m. -- 1 p.m., rather. We haven't
18 been here that long, of course. The court reporter
19 indicates that we are ready to go back on the record, and
20 in the interest of diving right in, Ms. Hodge, we left
21 with the answers to IERG question number 16 relating to
22 construction or modification. Why don't we dive right in
23 and see whether you have any follow-ups or clarifications
24 on that issue.
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1
MS. HODGE: Mr. Fox, I don't have any
2 follow-up to any of our additional prefiled questions and
3 the Agency answers. I have more questions in the general
4 category.
5
HEARING OFFICER FOX: Very good. Why don't
6 I -- You've indicated that neither 16 -- none of the
7 questions, your own questions, 16 through 21, require on
8 your part any further clarification or follow-up.
9
MS. HODGE: That's right.
10
HEARING OFFICER FOX: Why don't I just throw
11 that open to the other participants, if there are any
12 follow-ups or clarifications you would like to ask the
13 Agency based on IERG's last -- I believe that would be
14 six questions. I'm seeing no indication that there are
15 any follow-ups, so there's a reprieve for the Agency to
16 that extent, at least. Why don't we turn, Ms. Hodge, to
17 the follow-up questions of a general nature that you just
18 referred to a moment ago.
19
MS. HODGE: Will do. Will do. And I think
20 these are for the most part for Mr. Kaleel but may
21 involve some others as well. In the Agency's statement
22 of reasons and your prefiled testimony, one of the
23 purposes of the proposed rule is to achieve NOx emission
24 reduction for use in the ozone and fine particulate
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1 attainment demonstrations the Agency is preparing or has
2 prepared. What is the status of the Agency's stated
3 limitation plans for ozone?
4
MR. KALEEL: I think as I indicated at least
5 in response to some of the other questions -- I don't
6 recall if they were IERG questions or someone else -- the
7 Agency has not yet filed the ozone attainment
8 demonstration as was required by I believe June of 2007.
9 There have been a number of slow-downs or delays, the
10 most recent one being the vacatur of the CAIR rule. One
11 of the premises of our attainment demonstration was that
12 CAIR would be providing regional emission reductions
13 which were believed to be necessary for attainment, so we
14 had to do a demonstration since the time of that vacatur
15 to show or to determine whether or not CAIR was needed
16 for attainment. We've completed that modeling. We're
17 wrapping up the technical write-up right now. We hope to
18 be able to have public hearings on the attainment
19 demonstration before the end of the year with a submittal
20 to USEPA by early next year, and that would be the
21 attainment demonstration, reasonable further progress
22 demonstration, conformity demonstration. The NOx RACT of
23 course is -- and also BOC RACT would be elements that
24 wouldn't be included until rulemaking is completed.
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1
MS. HODGE: And that would be for both the
2 Chicago and the Metro East non-attainment areas?
3
MR. KALEEL: Good clarification. I'm sorry.
4 We did file the attainment demonstration for the
5 St. Louis metropolitan area on time in June of 2007.
6 We've not received any comments or any reaction or any
7 actions at all by USEPA, so the dates that I was
8 describing were for Chicago.
9
MS. HODGE: Chicago? Okay. Thank you.
10 Does the Agency intend to submit an implementation plan
11 for the Chicago area that will show attainment by the
12 June 2010 attainment deadline?
13
MR. KALEEL: The additional analysis that I
14 had described does demonstrate that the Chicago area will
15 attain by the attainment date 2010, even without full
16 implementation of CAIR. It shows southeast Wisconsin,
17 Indiana and Illinois all attaining by 2010. It does not
18 show attainment for the monitor in Holland, Michigan.
19 The modeling goes on to show that Holland, Michigan, will
20 attain by 2012.
21
MS. HODGE: Okay. Thank you. Does the
22 Agency's attainment demonstration for the Metro East
23 portion of the St. Louis non-attainment area show
24 attainment by the June 2010 deadline?
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1
MR. KALEEL: Yes, it does, with the proviso
2 that the modeling that we submitted in June of 2007
3 assumed implementation of CAIR. We have not looked at
4 the St. Louis area specifically to see whether the
5 vacatur of CAIR impacted that demonstration.
6
MS. HODGE: Does the Agency believe that it
7 has sufficient information to request the Chicago area be
8 redesignated as attainment for the eight-hour ozone
9 standard?
10
MR. KALEEL: Based on the three prior years
11 of air quality data, including data from 2008 which has
12 not yet been fully quality assured -- the ozone season
13 just ended a few days ago -- but based on the information
14 that we have, the Chicago area is -- Chicago area again
15 including southeast Wisconsin and northwest Indiana -- is
16 meeting the ozone standard.
17
MS. HODGE: Thank you. What is the status
18 of ozone air quality emissions in the St. Louis area in
19 terms of supporting a redesignation request at this time?
20
MR. KALEEL: Again, based on the most recent
21 information, I believe there's still one monitor on the
22 Missouri side of the river that is not attaining the
23 standard, so as of today, St. Louis does not qualify for
24 redesignation.
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1
MS. HODGE: Thank you. What is the status
2 of the fine particulate attainment demonstrations?
3
MR. KALEEL: The -- I'm going to try to
4 separate where we are with Chicago versus St. Louis,
5 because there's some differences. The modeling we've
6 performed so far for Chicago was demonstrating
7 attainment, assuming the reductions from the CAIR
8 program. The revised modeling doesn't show that anymore.
9 The revised modeling shows that Chicago will not attain
10 by 2010, that the CAIR reductions -- or not getting the
11 CAIR reductions is enough to undermine the previous model
12 or attainment demonstration. It does show that Chicago
13 would attain by 2012. There have been some discussions,
14 nothing concrete, about the possibility of requesting an
15 extension of the attainment date until 2012. Again,
16 nothing is solid on that yet. For St. Louis, we're not
17 too close yet. We have a local scale monitoring problem.
18 Most of the monitors in the St. Louis area, all of them
19 in Missouri and most of them in Illinois are showing
20 attainment. There's one hot spot, if you will, one area
21 that is not showing attainment, and as -- to date we've
22 not developed an attainment plan. We do not have
23 sufficient control measures identified to demonstrate
24 attainment.
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1
MS. HODGE: Okay. Thank you. The Agency
2 has proposed these NOx rules as part of its strategy for
3 attaining the eight-hour ozone standard; is that correct?
4
MR. KALEEL: That's a portion of the
5 strategy, yes.
6
MS. HODGE: And is it also correct that
7 these rules are intended to be part of the strategy
8 pertaining to fine particulate annual standard of 15
9 micrograms per cubic meter?
10
MR. KALEEL: Again, it's an element of the
11 strategy.
12
MS. HODGE: In the Agency's statement of
13 reasons, the 24-hour fine particulate standard is
14 mentioned, and there seems to be an inference that the
15 proposed NOx rule is designed to address emission
16 reductions as part of an attainment plan for both the
17 annual fine particulate standard and the 24-hour fine
18 particulate standard. Is this rule specifically intended
19 to address emission reductions related to the 24-hour
20 fine particulate standard or just the annual fine
21 particulate standard?
22
MR. KALEEL: As of right now, we don't
23 really know what will be required for the new standards.
24 Certainly we don't know what's going to be required in
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1 terms of demonstrating attainment. USEPA's not finalized
2 action towards establishing non-attainment boundaries in
3 Illinois for either of those standards, and our SIP
4 process kind of pivots off of the date that those
5 non-attainment boundaries are established, so we really
6 haven't started the planning process yet for those
7 standards. We offered in the statement of reasons and
8 again in my testimony that obviously NOx emissions are an
9 important element or constituent of any plan for ozone or
10 PM2.5, so the expectation is that the emission reductions
11 that we're proposing with the NOx RACT proposal will help
12 us to meet those standards, but I don't want to make any
13 claim at all that that would be all that might be
14 necessary to meet those standards.
15
MS. HODGE: Okay. Thank you. In your
16 testimony, you refer to reasonably available control
17 technology, or RACT. Is the proposed rule intended to
18 represent RACT for the source categories it addresses or
19 is it designed to achieve a level of emission control
20 that goes beyond RACT?
21
MR. KALEEL: What we intended with this
22 proposal was to satisfy the requirements to implement
23 RACT. We don't believe that these requirements go beyond
24 RACT.
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1
MS. HODGE: Have the emission reductions of
2 NOx from this proposed rule been included in attainment
3 demonstration modeling for both ozone and fine
4 particulates?
5
MR. KALEEL: Yes.
6
MS. HODGE: How have these emission
7 reductions been included in the model? That is, were the
8 reductions computed for each of the affected sources
9 specifically included in the model in each case or was
10 another technique used?
11
MR. KALEEL: No, we generally try to
12 implement the emission limits for specific units or
13 specific point sources in the modeling.
14
MS. HODGE: Does the Agency intend to use
15 the emission reductions from this rule for its rate of
16 progress demonstration for ozone and/or fine particulate?
17
MR. KALEEL: For ozone, no. The requirement
18 for ozone for rate of progress or reasonable further
19 progress was VOC, volatile organic compound
20 demonstration, and we were able to show -- or are able to
21 show for both non-attainment areas that we are achieving
22 sufficient progress, at least to 2009 or 2010 based on
23 VOCs alone. For PM2.5, the NOx reductions would be
24 included.
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1
MS. HODGE: Has a sensitivity analysis been
2 performed for ozone and/or fine particulate to determine
3 the impact that these emission reductions may have been
4 contributing to the attainment demonstration?
5
MR. KALEEL: Not a specific analysis. Just
6 isolating Illinois' NOx RACT proposal, the modeling that
7 has been performed to date has been done in cooperation
8 with the Lake Michigan Air Directors Consortium and
9 modeling runs look at strategies across multiple states,
10 not specific state-wide contribution. We do know that,
11 as I mentioned, the Holland monitor is not showing --
12 Holland, Michigan, monitor is not showing attainment --
13 either based on currently observed air quality or based
14 on air quality modeling is not showing attainment until
15 2012, and as I mentioned, the NOx RACT proposal for
16 Illinois is included and is -- at least my opinion, is at
17 least helpful to helping the Holland, Michigan, monitor
18 attain in 2012.
19
MS. HODGE: Thank you. In Tables 10-1 and
20 C-2 of the Agency's technical support document, the
21 Agency shows that this rule will result in a 46.3 percent
22 reduction of emissions from the 2005 base year, which the
23 tables show equals 20,666 tons per year. In your
24 opinion, would a reduction of just 10,000 tons per year
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1 make a perceptible change in the modeling results for
2 either ozone or fine particulate?
3
MR. KALEEL: I guess I can't really -- I
4 don't have a good feel for what the change in tonnages
5 would require, and we didn't approach the RACT proposal
6 with the idea that there was a certain emission target
7 that we needed to achieve, that kind of a top down
8 approach, you know, here's a certain budget that we have
9 to achieve, how do we achieve it. That's not the way we
10 did it. It's more bottom up, what are the control
11 measures for each source category that we consider to be
12 reasonable, and achieve the emission reduction estimates
13 that are included in the table that way.
14
MS. HODGE: Is it correct to conclude that
15 the primary purpose of this rule is to satisfy the NOx
16 RACT requirements mandated in the Clean Air Act and
17 contained in the ozone and fine particulate
18 implementation regulations the Agency referenced in the
19 statement of reasons?
20
MR. KALEEL: I mean, it's intended to both
21 contribute towards attainment demonstrations and to meet
22 the specific requirement in implementing RACT.
23
MS. HODGE: Thank you. In the Agency's
24 statement of reasons and in your testimony, Mr. Kaleel,
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1 you referred to the federal requirement to adopt RACT for
2 the eight-hour ozone attainment plan. Is it your
3 understanding that the particular Clean Air Act reference
4 for this requirement, Section 182(b)(2), as well as the
5 EPA's final rule to implement the eight-hour ozone
6 national ambient air quality standard final rule -- and
7 this is 70 Federal Register 71612 dated November 29,
8 2005 -- require the adoption of NOx RACT without regard
9 to the significance of the impact of the resulting
10 emission reduction in the ozone attainment plan?
11
MR. KALEEL: That's -- My understanding is
12 that RACT isn't specifically tied to the modeling, that
13 RACT is tied to the designation of an area as a moderate
14 ozone non-attainment area, moderate or higher.
15
MS. HODGE: Okay. Thank you. In your
16 opinion, are the RACT emission limits in your proposed
17 rule absolute limits that would be found in other similar
18 rules, or are these values a factor of the particular
19 characteristics of the emission sources and economics of
20 the region to which the rule applies?
21
MR. KALEEL: There's not a specific emission
22 limit published by USEPA that qualifies as RACT. The
23 determination of RACT is really incumbent on each state
24 to determine based on the mix of sources that they have
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1 and also to a certain extent the time period that they
2 are implementing the rule. Many states have implemented
3 NOx RACT back in -- prior to 1996 in response to the 1990
4 Clean Air Act amendments, and we're approaching NOx right
5 now with respect to the eight-hour ozone standards many
6 years later so that the -- I mean, the cost effectiveness
7 numbers, the control technology, how effective the
8 technology is, it's different now than it would have been
9 years ago, and that's something that again goes to the
10 state-specific estimate of what is RACT.
11
MS. HODGE: Thank you. As part of your
12 analysis for this rule and for the ozone attainment
13 demonstration, have you computed the emission reductions
14 derived from the NOx SIP call for the emission units that
15 are subject to this rule?
16
MR. KALEEL: In -- Perhaps not specific to
17 the NOx RACT proposal, but we've made estimates in many
18 different analyses that we've done with the emission
19 reductions both from the NOx SIP call and also from CAIR.
20
MS. HODGE: Do you know whether the USEPA
21 would accept compliance with the NOx SIP call trading
22 program as RACT for purposes of the ozone attainment
23 demonstration?
24
MR. KALEEL: I'm not aware of any specific
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1 guidance with respect to the NOx SIP call. There was in
2 the CAIR rule -- for electric generating units, there was
3 specific provision that at the State's option that
4 utilities meeting CAIR could be deemed as meeting RACT.
5 I don't know that there's similar language in the NOx SIP
6 call. Consistent with USEPA's rulemaking that CAIR
7 equals RACT, we felt that our multi-pollutant standards
8 contained in the mercury rulemaking and also in our CAIR
9 rulemaking exceeded the reductions that would have been
10 provided by CAIR, so we included the multi-pollutant
11 option as a compliance option for EGUs.
12
MS. BASSI: Is there --
13
MS. HODGE: Sure. Go ahead.
14
MS. BASSI: Mr. Kaleel, do you recall what
15 the emission rate basis was for industrial boilers in the
16 NOx SIP call rulemaking?
17
MR. KALEEL: My understanding was the NOx
18 SIP call reduction for industrial boilers was 60 percent
19 reduction.
20
MS. BASSI: Was there an emission rate?
21
MR. KALEEL: I don't believe there was an
22 emission rate.
23
HEARING OFFICER FOX: Anything further,
24 Ms. Bassi?
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1
MS. BASSI: Oh. No, I'm done. I'm sorry.
2
MS. HODGE: Mr. Kaleel, if USEPA has made
3 any statements about how they would accept compliance
4 with the NOx SIP call trading program as RACT for
5 purposes of ozone attainment demonstration, would that
6 change or affect the Agency's decision on this proceeding
7 in any way?
8
MR. KALEEL: I don't know that it would
9 affect it. I think the multi-pollutant standards for
10 utilities, that is an already established state rule, and
11 we've included that as an option for compliance for NOx
12 RACT. As I mentioned, a RACT proposal is intended not
13 just to address ozone but also PM2.5, and the standard is
14 an annual standard. The NOx SIP call is just an ozone
15 season trading program, so I don't believe it would be
16 equivalent to RACT unless there was a commitment on the
17 part of the utilities to operate their controls
18 year-round.
19
MS. HODGE: What about for industrial
20 boilers, though?
21
MR. KALEEL: Again, the industrial boiler
22 requirement in the NOx SIP call is a summer season
23 requirement only, not an annual requirement.
24
MS. HODGE: But for ozone purposes, wouldn't
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1 that be sufficient?
2
MR. KALEEL: Well, we've not made that
3 determination, and again, I'm not sure that the NOx SIP
4 call -- that there was any provision in the SIP call
5 language. I could double-check that, but I don't believe
6 there was ever a provision that it would constitute RACT
7 or be equivalent to RACT, and I think the -- what we
8 consider to be RACT for industrial boilers is -- would
9 provide greater reductions than a NOx SIP call would; not
10 just in the summer season, but any of them.
11
MS. HODGE: If the emission units that were
12 subject to the NOx SIP call complied with that program on
13 an annual basis, would that affect your decision-making
14 here?
15
MR. KALEEL: I guess I doubt it, again,
16 because I don't think the emission reductions are
17 equivalent to RACT based on our calculation or our
18 demonstration.
19
MS. HODGE: Have you or other agency staff
20 determined whether the collective emissions from all
21 emission units subject to the proposed rule already
22 achieve the emission reductions proposed by this rule?
23
MR. KALEEL: Could you repeat that? I'm --
24 I think I missed something there.
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1
MS. HODGE: Have you or other agency staff
2 determined whether the collective emissions from all
3 emission units subject to the proposed rule already
4 achieve the emission reductions proposed by this rule?
5
MR. KALEEL: I don't believe that they do.
6 I guess I haven't looked specifically at the most recent
7 reported emissions to see whether or not they're already
8 complying, and I'm not sure we would even have the data
9 in-house to do that. My expectation is that we're
10 looking at retrofits, additional controls, and that at
11 least my expectation is that companies are not currently
12 meeting the limits that are proposed in many cases.
13
MS. HODGE: Thank you. In the Agency's
14 statement of reasons and in your testimony, you refer to
15 the federal requirement for NOx RACT for the fine
16 particulate attainment plan. Is it your understanding
17 that the particular Clean Air Act reference for this
18 requirement, Section 172(c)(1), as well as EPA's clean
19 air fine particulate implementation rule -- it's final
20 rule, 72 Federal Register 20586 dated April 25, 2007 --
21 provides some degree of discretion to determine the scope
22 and extent of NOx RACT?
23
MR. KALEEL: Yes, I'm aware of that.
24
MS. HODGE: Thank you. Do you believe the
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1 EPA's clean air fine particle implementation rule gives
2 the Agency and USEPA the authority to conclude that no
3 fine particulate measures are required if such measures
4 could not advance the attainment date by one year if the
5 Agency would be attaining the standard by April 2010?
6
MR. KALEEL: That's my understanding, or
7 it's consistent with my understanding of the
8 implementation rule. As I indicated in response to one
9 of your previous questions, I don't believe either the
10 Chicago area or the Metro East area will be attaining the
11 PM2.5 standard by the deadline, so I don't think we have
12 that discretion.
13
MS. HODGE: Thank you. Do you believe that
14 the EPA's clean air fine particle implementation rule
15 gives the Agency and the USEPA the authority to exclude
16 RACT measures that can be shown not to advance the fine
17 particulate attainment date by at least one year?
18
MR. KALEEL: I think I answered that there
19 is some discretion in terms of how to define RACT.
20
MS. HODGE: Thank you. In response to
21 IERG's question 3 regarding whether the Agency considered
22 the federally approved NOx RACT emission limits from
23 other states when it formulated its proposal, you
24 answered yes. Actually, I think we've already answered
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1 this one. I'm asking for elaboration on the other
2 states. We've already done that. Okay. In response to
3 prefiled questions, the Agency stated that if a facility
4 switches fuels after the effective date of this rule, it
5 would be subject to an emission limit based upon the
6 original fuel. Does the Agency intend to amend the rule
7 to make that explicitly clear in the rule?
8
MR. KALEEL: We're open to doing that if
9 it's not clear enough in the language of the rule. That
10 is our intent.
11
MS. HODGE: It's your intent? Thank you.
12 And I have just a couple of questions for Mr. Kaleel and
13 then I think for Mr. Gupta, and we'll go ahead and wrap
14 up with Mr. Kaleel. In proposing subpart D for
15 industrial boilers, did the Agency consider whether a
16 boiler fueled with coke oven gas could meet the proposed
17 emission limitation in Section 217.164(a)?
18
MR. KALEEL: Indirectly, yes. I don't think
19 we specifically anticipated coke oven gas, but we are
20 aware that some boilers use what's called process gas in
21 their boilers, and in general we believe that the
22 emission limits can be met with the control technologies
23 that we provided in the TSD.
24
MS. HODGE: And in the Agency's TSD, were
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1 any of the units or any of the data or information
2 considered boilers that were fueled with coke oven gas?
3
MR. KALEEL: Certainly certain boilers that
4 burn coke oven gas are listed in our TSD as affected
5 units. We don't have specific information available to
6 us right now about the specific constituents of coke oven
7 gas or other process gases to the extent that it may make
8 it difficult to achieve compliance with reasonably
9 available control measures, and there's at least one
10 affected unit we're having discussions with right now in
11 that respect.
12
MS. HODGE: Thank you. Thank you. In
13 proposing subpart H here for iron and steel and aluminum
14 manufacturing, did the Agency consult with affected
15 sources in the state to ascertain whether emission units
16 of these affected sources could actually comply with the
17 proposed emissions limitations?
18
MR. KALEEL: Yes, we have consulted with
19 companies, at least many of them.
20
MS. HODGE: And do you anticipate submittal
21 of a revised proposal for some emission unit types
22 covered by subpart D?
23
MR. KALEEL: I guess I --
24
MS. HODGE: I'm sorry. For subpart H.
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1 Subpart H.
2
MR. KALEEL: We don't rule that out. There
3 are some ongoing discussions and we certainly are willing
4 to continue those discussions, and if as a result of any
5 information that's put before us it changes our mind,
6 we'd certainly entertain a revision of the proposal.
7
MS. HODGE: Okay. Thank you. And now I
8 have a few questions for Mr. Gupta, and this really goes
9 to the Table D-1 in the appendix to the Agency's TSD, and
10 first of all, I would ask whether the Agency could get us
11 a better copy of that table, and it's nearly impossible
12 for me to read, and I understand others as well, and even
13 when I look at, you know, the version that's online, I'm
14 having a very difficult time, and I was wondering if the
15 Agency could make the document available to us in its
16 original Excel file form so that we can --
17
MS. BASSI: Read it.
18
MS. HODGE: -- read it and allow us to, you
19 know, really determine what's there.
20
MR. GUPTA: Yeah, sure, no problem. We can
21 provide that.
22
MS. HODGE: Okay. Thank you very much.
23 Have -- And, Mr. Gupta, have you compared the affected
24 emission units on this Table D-1 with current permitted
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1 or actual emissions to the emission reductions you have
2 estimated as coming from this rule?
3
MR. GUPTA: No, we have not. We have looked
4 at it as a group, but not as individual sources.
5 Basically, what we looked into was what is the baseline
6 NOx emissions in the ACT document and looked at that
7 information to calculate how much of a reduction will be
8 needed to comply with the limitations, and that's what we
9 had done rather than going source by source, how much
10 emissions are currently in -- currently they have.
11
MS. HODGE: Okay. So even though the Table
12 D-1 is pretty much a listing source by source, you didn't
13 conduct your analysis on a unit-by-unit basis.
14
MR. GUPTA: Right. That's correct.
15
MS. HODGE: Okay. Could you tell us a
16 little bit more about how you did prepare this table in
17 the analysis? Could you walk us through the table and
18 maybe just pick a particular company or unit, just
19 explain to us what you did, please?
20
MR. GUPTA: My table is also as unclear as
21 yours. Okay.
22
MS. HODGE: Okay. Mr. Kolaz has indicated
23 that we could use Table 23 as just an example here today,
24 and that one's a little more legible for us.
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1
MS. BASSI: Miss Hodge, is that Table C-2?
2
MS. HODGE: It is C-2, "NOx Reductions from
3 the Application of NOx RACT (Reductions By Categories)."
4 Again, this is not on a unit-by-unit basis, but if you
5 could just walk us through the categories.
6
MR. GUPTA: Okay. Let's look into the
7 gas-fired boilers, which are the very first row under
8 Chicago non-attainment area. Based on our ACT document
9 for ICI boilers, we have certain baseline emissions, and
10 those baseline emissions were used to compare with the
11 NOx emission limit, which is 0.08, to get that -- on an
12 average we got 69.2 percent reduction, and same thing was
13 applied to other source category as you go down.
14
MS. HODGE: But -- I'm sorry. A
15 reduction -- What is the 69.2 percent? A reduction from
16 what to what?
17
MR. GUPTA: Okay. The ACT document is --
18 lists uncontrolled emissions from each of those source
19 categories. Take the example of natural gas-fired
20 boiler. They have hot water which are more than 100
21 million BTU per hour, so much uncontrolled emissions. I
22 don't have the number right in front of me, but let's say
23 the X are emissions which are uncontrolled, and then our
24 limit is 0.08, so X minus 0.08 and divided by X, that
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1 gives the reduction from this particular source.
2
MS. HODGE: Okay. So the uncontrolled
3 emissions, is that your estimate for the category --
4
MR. GUPTA: Right. That's what --
5
MS. HODGE: -- or -- you haven't looked at
6 individual units --
7
MR. GUPTA: No. It was not --
8
MS. HODGE: -- what their uncontrolled rates
9 might be.
10
MR. GUPTA: That's correct.
11
HEARING OFFICER FOX: Ms. Bassi?
12
MS. BASSI: Mr. Gupta, according to this
13 Table C-2, I believe it's saying that you were looking at
14 2005 NOx emissions?
15
MR. GUPTA: Right.
16
MS. BASSI: But isn't the base year 2002?
17
MR. GUPTA: We started with the year 2002,
18 but since that time there were several sources which have
19 been either shut down or reconstructed, modified, so the
20 year 2002 emissions were no longer granted as far as
21 looking at what is, you know, the more recent number,
22 which we used 2005, as, you know, that -- like, some of
23 the steel plant sources, several sources have been shut
24 down, done some modification to those sources, so we used
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1 2005 to get a little better data on what's the current
2 status of those sources.
3
MS. BASSI: Could I follow up with that a
4 minute?
5
HEARING OFFICER FOX: Yes. Please go ahead.
6
MS. BASSI: I'm not sure whose questions
7 these were. I think they might have been IERG's
8 questions about using averaging plans or including units
9 in averaging plans that were post-2002 new units. Did
10 you have that?
11
MS. HODGE: Right, we had a question like
12 that.
13
MS. BASSI: Okay. And what you're telling
14 me is or what we understood was is that 2002 was the base
15 year, and yet your analysis is based on 2005, and yet
16 units that were built after 2002 cannot be included in an
17 emissions averaging plan; is that correct?
18
MR. KALEEL: If I could maybe try to respond
19 to that. We're not intending that 2005 be a base year
20 for this analysis. We were just trying to represent at
21 the time we were doing this what is the most recent
22 information that we have available through our annual
23 emission reports to make this demonstration. We're not
24 computing reasonable further progress from these numbers.
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1 We're not using this particular calculation in our
2 attainment demonstration. It was really just geared
3 maybe more for the benefit of stakeholders to provide the
4 most recent information that we had at the time that we
5 were doing our outreach, so it doesn't tie in -- the fact
6 we used 2005 does not tie into averaging plans, does not
7 tie into reasonable further progress. That was just
8 trying to use the most recent information we had
9 available.
10
MS. HODGE: So the emission reductions that
11 you're estimating are from the '05 levels.
12
MR. KALEEL: For the purposes of this table
13 and this TSD, that's right.
14
MS. HODGE: And for the purposes of this
15 rule, support for the rule.
16
MR. KALEEL: For illustrating the amount of
17 reductions that we are expecting, we used 2005, but we're
18 using it to represent the population of sources as
19 currently as we know them, at least at the time that we
20 were putting this stuff together, but that's -- when we
21 did our modeling, we used the 2002 inventory. When we
22 are doing our reasonable further progress calculations,
23 we're using the 2002 inventory.
24
MS. HODGE: Okay.
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1
MR. KALEEL: Again, I think just to add to
2 the comment I made before, we're not trying to determine
3 that there's a certain tonnage reduction out there that
4 represents RACT and then trying to show how we meet that.
5 We started at the bottom, what sources would be affected
6 by the rule, how much reduction do we expect from those
7 sources, so -- from application of reasonable controls.
8 So there's nothing magic about the total amount of
9 emissions that we're showing in this table. That's --
10
MS. HODGE: So again -- I think we discussed
11 this before -- the total amount of emissions that you're
12 showing here is not necessary for -- to demonstrate
13 attainment.
14
MR. KALEEL: It's not a target that we are
15 trying to achieve. It's not a budget. It's, you know,
16 similar to, like, the SIP call or CAIR. It's not how we
17 arrived at it. If there was a different total that we
18 achieved as a result of application of RACT, we'd have
19 been comfortable with that different total, anything we
20 don't achieve through RACT that might ultimately lead to
21 more stringent measures somewhere else in terms of
22 demonstrating attainment, if the modeling had shown that
23 that was necessary, but again, it's not a budget.
24 It's -- That's not how we approached it.
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1
MS. HODGE: Okay. Thank you. Let's go back
2 and look at this Table C-2, Mr. Gupta.
3
MR. GUPTA: Uh-huh.
4
MS. HODGE: And the first emission category,
5 the gaseous fuel-fired boilers greater than 100 million
6 BTU, again, we're looking at total. Please go over to
7 the column, the heat input, million BTU per hour, and we
8 see a number of 6,911.9.
9
MR. GUPTA: That's the heat input capacity
10 of the units as we had in our inventory, so the total
11 heat input capacity of all the sources in that category.
12
MS. HODGE: Okay. And then if you go over a
13 few columns to the estimated controlled NOx, the tons per
14 year, and the number here is 368.2.
15
MR. GUPTA: Uh-huh.
16
MS. HODGE: How did you -- Was that a
17 calculated number, the 368.2? Did you apply the 0.08
18 or -- could you explain how you arrived at that number?
19
MR. GUPTA: That was based on the
20 application of 0.08 to the original numbers. If you see
21 the column below -- before that one is 69.2 percent
22 reduction, so if you apply 69.2 percent reduction to a
23 column before that one, 1196.5, you get 368.2.
24
MS. HODGE: If you divide the heat input
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1 number by the estimated controlled NOx number or vice
2 versa -- I mean, I -- we can't get these numbers to come
3 out the same.
4
MR. GUPTA: Okay. This is not how we did
5 it. The heat input is the heat input capacity of the
6 unit, which has nothing to do with how much NOx emissions
7 are generated, so the reduction was calculated based on
8 how much NOx emissions were there and then apply 69.2
9 percent reduction to get estimated reduction.
10
MS. HODGE: Okay. So then the 2005 NOx
11 emissions, tons per year, that column, the 1,196.5, is
12 that based on actual emissions for '05?
13
MR. GUPTA: These are based on actual
14 emissions, yes. Sorry. These are based on the actual
15 emissions in our inventory.
16
MS. HODGE: I'm sorry.
17
MR. GUPTA: Those -- That -- These emissions
18 are based on actual emissions in our inventory.
19
MS. HODGE: In your inventory.
20
MR. GUPTA: Yeah.
21
MS. HODGE: Okay. Thank you. And then
22 where did 69.2 percent -- where did that number come
23 from, the estimated NOx RACT reduction?
24
MR. GUPTA: As I pointed out here, we have
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1 these uncontrolled emissions in ACT document. Let's take
2 natural gas-fired boilers. The uncontrolled NOx
3 emissions is 0.26 pounds per one million BTU, and when
4 you bring it down to 0.08 pounds per million BTU, that
5 calls for 69.2 percent reduction.
6
MS. HODGE: May we request this Table C-2 as
7 well?
8
MR. GUPTA: This table is a part of our TSD.
9 Let me see which particular table it is.
10
MS. HODGE: Right. I understand that, but
11 may we request this in the Excel file form as well?
12
MR. GUPTA: Yes, yes.
13
MS. HODGE: It'll help us see the --
14
HEARING OFFICER FOX: Your specific request,
15 Ms. Hodge, is larger print, more readability? Is -- Am I
16 correct in understanding that?
17
MS. HODGE: And how the calculations are
18 made as well so we can see the formulas within the tables
19 in the Excel spreadsheets.
20
HEARING OFFICER FOX: Very good. Thank you
21 for clarifying that.
22
MR. GUPTA: That should be no problem. We
23 can provide that.
24
MS. HODGE: Okay. Thank you. And I have
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1 just a question to clarify. Before, when we had talked
2 about how have the emission reductions been included in
3 the model, what emission reductions did you include in
4 the model, Mr. Kaleel? Did you include the reductions
5 shown on these tables or --
6
MR. KALEEL: We actually had different staff
7 people working on that particular assignment. We'd use
8 the -- whatever the model base year emissions are and
9 then applied the specific emission limit to those
10 generally unit by unit. I don't know if this table was
11 in front of the person on the modeling staff that was
12 doing that at the time, so it's --
13
MS. HODGE: Could we get that information,
14 please? Could the Agency --
15
MR. KALEEL: Sure.
16
MS. HODGE: -- submit that information into
17 this record, please? Okay. I do have one more question.
18 This is kind of in follow-up to the questions that I had
19 before on the categories within this rule for which no
20 such units exist within the non-attainment areas, and I
21 think we talked about cement kilns and then we talked
22 about, you know, one of the aluminum furnaces too. Could
23 the Agency identify for us any other categories or
24 subcategories for which units do not currently exist in
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1 the non-attainment areas?
2
MR. KALEEL: We'd be happy to look at that.
3 I believe those are the only two categories where there
4 are no units in the non-attainment areas, but we'd be
5 happy to confirm that.
6
MS. HODGE: Okay. Thank you. Thank you
7 very much. Okay. That completes all of the questions of
8 IERG.
9
HEARING OFFICER FOX: Thank you, Ms. Hodge.
10 We had -- I think you had indicated that for questions 16
11 through 21 that you have filed, you had no follow-ups
12 whatsoever?
13
MS. HODGE: No follow-up.
14
HEARING OFFICER FOX: Were the IERG
15 questions 16 through 21, actually, I believe, the subject
16 of any clarification or any follow-up that any of the
17 other participants wish to pose? Seeing none, I believe
18 that would bring us to Midwest Gen, Ms. Bassi, if I
19 remember our order of proceeding correctly. You had
20 prefiled questions and the Agency had prefiled answers
21 both for Mr. Kaleel and for Mr. Staudt -- Dr. Staudt,
22 whose questions were 24 to 48, and if you are prepared to
23 begin with 24, I think we've reached that point in our
24 proceedings today.
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1
MS. BASSI: My name is Kathleen Bassi. I'm
2 with the law firm of Schiff Hardin LLP in Chicago. With
3 me today is Thomas Bell, an associate with our firm, and
4 Scott Miller of Midwest Generation, and we are here today
5 representing Midwest Generation. We're beginning with
6 our -- with the responses to the questions that we
7 prefiled for Dr. Staudt, and this begins, as Mr. Fox
8 said, with question number 24, and I did not have a
9 follow-up on 24, and in fact, I did not have a follow-up
10 until number 27.
11
HEARING OFFICER FOX: Ms. Bassi, why don't I
12 see whether any of the other participants on questions
13 number 24, 25 or 26 filed by Ms. -- Midwest Generation
14 had generated a request for any clarification or
15 follow-up. Are we clear on those and prepared to proceed
16 to question number 27? It appears that we are.
17 Ms. Bassi, that refers to the issue of whether SCR is or
18 is beyond RACT. Did you have a follow-up or
19 clarification? Apparently you do. Please go ahead.
20
MS. BASSI: Thank you. Yes, this question
21 does concern SCR, and it -- and you state here that you
22 believe, Dr. Staudt, that SCR is likely not to be
23 necessary under the proposed rule, correct? That's in
24 your statement?
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1
DR. STAUDT: Yes, that's --
2
MS. BASSI: You're sticking with it?
3
DR. STAUDT: Yes, I'm sticking with it.
4
MS. BASSI: Okay. Well, for -- in order
5 really for this question -- for my follow-up question
6 here to make sense, I need to go back to question 21, if
7 you don't mind.
8
HEARING OFFICER FOX: No. If that's what's
9 required to make sense, let's do that.
10
MS. BASSI: All right. In question 21,
11 question 21 was what is the basis for determining that
12 the 0.9 pounds per million BTU rate in Section 217.344(a)
13 is RACT, and there followed in the Agency's response
14 quite a long and detailed answer. Dr. Staudt, did you
15 prepare that answer for the Agency?
16
DR. STAUDT: Yes, I did.
17
MS. BASSI: Okay. So, Mr. Kaleel, do you
18 take no ownership of that answer?
19
MR. KALEEL: Mr. Staudt -- Dr. Staudt
20 prepared the answer.
21
MS. BASSI: Okay. Thank you. Some of
22 the -- And again, we've already established, then, that
23 2002 is the base year. I'm sorry. I'm going through my
24 rules -- my questions. Some of them have already been
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1 answered. In your response, Dr. Staudt, there is a
2 statement that you make that says uncontrolled units
3 would typically have an emissions rate of at least 0.5
4 pounds per million BTU, but even at uncontrolled NOx
5 levels of 0.4 pounds per million BTU, and you go on and
6 say the cost would be estimated to be about $2500 per
7 ton, and this is in the response shortly under the second
8 reference to 70 Fed Reg 25162. It's --
9
DR. STAUDT: Well, the document speaks for
10 itself. We can all read it and see that.
11
MS. BASSI: Okay. The issue that I want to
12 get at here is the notion of uncontrolled levels and what
13 actually exists at sources, and would -- is it your
14 understanding that some of the sources or even many of
15 the sources that would be subject to -- that are
16 coal-fired or fossil fuel-fired units already include a
17 number of the combustion controls that you describe in
18 the TSD?
19
DR. STAUDT: Yes, many of the -- if you're
20 looking at utility boilers -- I presume you're talking
21 about utility boilers -- that many of them do -- the
22 majority of them do incorporate some combustion controls.
23
MS. BASSI: Would the combustion controls of
24 low NOx burners and overfire air be necessarily likely to
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1 allow a utility boiler, a coal-fired boiler, to achieve
2 an emission rate of 0.9 -- 0.09 pounds per million BTU?
3
DR. STAUDT: Just combustion controls and
4 overfire air, that would -- that's not common, although
5 in the 2007 ozone season, Baldwin unit 3, which only has
6 combustion controls, had a season average of 0.088 pounds
7 per million BTU, so -- and that's not the only unit in
8 the entire country, but the -- that's -- but it's true
9 that most -- that's not common, that level. That
10 emissions level is not common.
11
MS. BASSI: Would achieving that emission
12 level perhaps depend upon the type of coal-fired boiler
13 it is? You describe several types of coal-fired boilers
14 in the TSD. Let me back up a minute. Did you write the
15 TSD?
16
DR. STAUDT: Yes. I mean, I -- there was
17 input from the Agency, but I had a major -- I was -- I
18 had a major role in writing the TSD.
19
MS. BASSI: Are there portions of the TSD
20 that you did not draft?
21
DR. STAUDT: The -- Some of the tables that
22 I think Mr. Gupta put together, but by and large, I wrote
23 virtually all of it.
24
MS. BASSI: And is it correct that you
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1 incorporated the TSD as part of your testimony?
2
DR. STAUDT: That is correct.
3
MS. BASSI: Okay. So then going back to the
4 TSD, in the TSD, I believe you describe several different
5 types of coal-fired boilers.
6
DR. STAUDT: Yes.
7
MS. BASSI: I think you said wall-fired
8 and --
9
DR. STAUDT: Tangentially-fired and cyclone
10 and --
11
MS. BASSI: Thank you. You can't put that
12 in the -- okay. Would the type of boiler have any impact
13 on whether the boiler was able to achieve a 0.09 rate
14 with just combustion controls?
15
DR. STAUDT: Yes, it would.
16
MS. BASSI: Would a rate of 0.13 or so be a
17 common rate with -- or a not unexpected rate with just
18 combustion controls?
19
DR. STAUDT: It depends. Depends upon the
20 unit. It's actually -- 0.13 is -- you have a lot of
21 boilers in Illinois that fire Powder River Basin coal,
22 and there are a number of units that are already
23 achieving that level or better with just combustion
24 controls.
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1
MS. BASSI: Okay.
2
DR. STAUDT: But it depends upon the unit
3 and time. Now, bear in mind that according to the rule,
4 utilities subject to the multi-pollutant rules and
5 whatnot, they are -- they have their own -- that applies
6 as RACT. That's my understanding according to the rule.
7
MS. BASSI: Right. If a unit were already
8 achieving a level of 0.13, would the conclusions that are
9 drawn in the TSD regarding the emission controls that
10 would be necessary to get to a 0.09 be the same? Would
11 you draw the same conclusions? As I understand your
12 responses to the questions and the TSD, this rule is
13 based on an assumption of uncontrolled emission levels
14 and that low NOx burners and overfire air are considered
15 combustion controls that are already achieving part of
16 the reduction that would be necessary to meet the rates
17 that are listed in the rule, and so the question is,
18 since these things preexist the proposal, these control
19 measures preexist the proposal, does that change the
20 analysis at all in terms of the equipment type and the
21 cost of control to get down to the 0.09?
22
DR. STAUDT: Well, first of all, for utility
23 boilers, the 0.09 only applies to those utility boilers
24 that are not part of a multi-pollutant.
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1
MS. BASSI: Well, there could be some, you
2 know.
3
DR. STAUDT: Well, I'm not aware of any.
4
MS. BASSI: And that --
5
DR. STAUDT: There are some, but there's
6 Kincaid. You've got Kincaid. I don't know if it's
7 covered by that rule.
8
MR. KALEEL: It's not.
9
DR. STAUDT: So, you know, we get to the
10 point where we have to look at the rule the way it is,
11 not the way we would like to interpret it down to -- on a
12 particular unit.
13
MS. BASSI: Well --
14
DR. STAUDT: The rule says that people who
15 are subject to these multi-pollutant system, which
16 Midwest Generating is, they need to -- that satisfies the
17 RACT requirement.
18
MS. BASSI: Well, I don't want to get into
19 mincing words that are in the rule with you over the
20 applicability, because that's covered in some earlier
21 questions that are posed to the -- to Mr. Kaleel or
22 whoever that he deems, but the way the applicability
23 section of subpart M reads right now, it appears to me
24 it's based on the applicability of the CAIR, which may
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1 not exist, and if it doesn't exist, then there's a
2 question of what actually -- whether you even get to the
3 CPS and the MPS exemptions, and so that's why we feel
4 it's important to address the 0.9 and the cost figures
5 and whether it is an SNCR or an SCR that might be
6 necessary to achieve those levels if the rule is not
7 amended in the way that has been proposed in these
8 questions.
9
MR. KALEEL: If I could address that point,
10 I believe there -- and it's in response to a subsequent
11 question from Midwest Generation that gets to the
12 question of applicability with respect to CAIR, and I
13 think there's some language that Midwest Gen proposed,
14 and there's an alternative set of language that the
15 Agency's in agreement with that should address that
16 issue, I believe, so --
17
MS. BASSI: We agree, but it still has to be
18 adopted.
19
MR. KALEEL: Understand.
20
MS. BASSI: So back to my question, what I'm
21 asking is is to achieve a 0.04 additional reduction or --
22 in emission rate, what you're saying, cost analyses and
23 conclusions about control technology apply.
24
DR. STAUDT: Potentially we have -- you
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1 could potentially do it through deeper stage, deeper air
2 staging in combination with SNCR, but having said that,
3 if it were not possible to do that, for example, if you
4 had a unit that was -- that could not even get the 0.13
5 or 0.11 --
6
BOARD MEMBER JOHNSON: I missed that.
7
DR. STAUDT: If that were not -- excuse me.
8 If that were not possible, that might change things, but
9 in terms of the way the rule is as I understand it to be,
10 that where -- the people with multi-pollutant facilities
11 with the multi-pollutant standards would -- that would be
12 their RACT. That -- You know, I stand by my --
13
MS. BASSI: And we're not disputing that.
14
DR. STAUDT: Good.
15
MS. BASSI: We -- We're not disputing that.
16 We're not asking that question.
17
DR. STAUDT: But let me just give you --
18 just to give you -- if you had a hypothetical situation
19 where to get from 0.13 pound per million BTU to under
20 0.09, now, I think it potentially could be done with SNCR
21 and a combination of air staging, but there's a chance
22 that it might not. If you had to put in SCR, that cost
23 would -- the cost would likely -- it would be a higher
24 number than using a -- on a dollar per ton basis than
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1 using a baseline of 0.4 or 0.5 million -- pounds per
2 million BTU, so I think -- I wanted to basically create
3 the -- describe that situation, because I think it gets
4 to what you're looking for, if you're looking at marginal
5 cost, the incremental cost of the controls.
6
MS. BASSI: Excuse me. I'm looking at my
7 numbers. Sorry. I forgot what my numbers meant. Okay.
8 What is the maximum amount of reduction that you would
9 expect to see from an SNCR on a coal-fired boiler?
10
DR. STAUDT: Well, it depends, you know.
11 It's -- I have seen as much as 60 percent. I would not
12 expect to see it at higher levels, but that's usually at
13 a higher NOx baseline. You could potentially see 20 --
14 you know, 20, perhaps 30 percent. So what I said is
15 potentially at 0.13, could you get under 0.09?
16 Potentially through a combination of SNCR and deeper air
17 staging, but that's -- but I'll be the first to say that
18 SNCR is the -- utility boiler applications, particularly
19 at low emission rates, are the more challenging type of
20 applications. That's why -- So -- But again, we get back
21 to I don't see -- the reason -- I don't see -- we -- the
22 way the rule as I understand it's supposed to be -- work,
23 we're discussing a moot point, because the utilities
24 would be exempted from this, at least the utilities
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1 subject to the multi-pollutant standard would be exempted
2 from this.
3
MS. BASSI: Just looking at straight math, a
4 30 percent reduction, if you -- I believe you said 60
5 percent when you have higher baseline -- or higher --
6 deeper NOx reductions that you would be making with the
7 SNCR, but were you starting with the lower baseline in
8 the first place? I don't -- The lower emission rate in
9 the first place, would -- 30 percent would be perhaps the
10 high end? Is that what I heard you say?
11
DR. STAUDT: Perhaps. It depends, yeah.
12
MS. BASSI: It depends? So would 30
13 percent, just looking at straight math, result in a rate
14 of 0.09, do you think?
15
DR. STAUDT: Well, I could pull out my
16 calculator, but my guess is it would be close, but
17 perhaps not.
18
MS. BASSI: Would 0.091 be compliant? And
19 maybe that's not a question for you.
20
DR. STAUDT: My answer before was that
21 through a combination of air staging and SNCR, deeper air
22 staging and SNCR, you could perhaps -- there are units in
23 Illinois that are running at 0.11 pound per million BTU,
24 you know, and it's through air staging, but again, we're
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1 getting back to the way I understand the rule is written,
2 this is kind of a moot point, and that's why --
3
MS. BASSI: We hope it is too.
4
DR. STAUDT: Yeah.
5
MS. BASSI: Okay. Do you know the cost
6 today of an SCR?
7
DR. STAUDT: What the cost -- I've seen
8 studies on what the costs have been.
9
MS. BASSI: Can you give us a range?
10
DR. STAUDT: Oh, in the range of about --
11 you know, it'll vary anywhere from 100 to as high as
12 maybe 200 dollars a kilowatt, but that's -- you know, the
13 mid range being about 150 dollars a kilowatt.
14
MS. BASSI: Would you be surprised at --
15
DR. STAUDT: For utility.
16
MS. BASSI: Would you be surprised at over
17 $300 a kilowatt?
18
DR. STAUDT: I would be. I can't rule it
19 out, but I would be -- that would certainly be an
20 outrider. There have been studies that looked at this,
21 and they've -- you know, basically the midpoint is
22 somewhere at, you know -- somewhere in the $150 a
23 kilowatt range.
24
MS. BASSI: And again, this might be a
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1 question for the Agency as opposed to you because they
2 have the implementation and enforcement decisions. If
3 the cost -- If a source demonstrated that the cost to
4 comply was significantly higher than what the Agency has
5 identified as the RACT range of this rule, would that --
6 would this rule not be RACT, at least as applied to that
7 source?
8
MR. KALEEL: I think an argument could be
9 made that if the costs for a particular unit greatly
10 exceed the range that we have in mind for RACT that the
11 unit would qualify or at least we could support an
12 adjusted standard type of a proceeding.
13
MS. BASSI: Okay. Thank you. All right.
14 Going back to my questions, then, we were on question 27,
15 and I think you've just answered it.
16
MS. HODGE: Miss Bassi, may we ask a
17 follow-up on your prior question?
18
MS. BASSI: Yes, absolutely.
19
MS. HODGE: And we're headed back to the
20 appendices here, and it's Table C-2, "NOx Reduction from
21 the Application of NOx RACT (Reductions By Categories),"
22 and on the -- down near the bottom of the table -- and
23 I'm talking on page 23 and 24 here, because it's a
24 two-pager -- we do have emission reductions from EGU
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1 coal-fired boilers, total, and I just understood that the
2 Agency said that these units are not really covered by
3 this rule, so why are we showing reductions here in the
4 TSD?
5
MR. KALEEL: I think what our intent is is
6 the multi-pollutant standard satisfies the requirement
7 for RACT. I don't recall if these specific emission
8 reductions are from a straight application of the 0.09
9 pound per million emission limit or if they reflect the
10 emissions from the multi-pollutant standard. I guess I'd
11 refer to Mr. Gupta for that, but there will be
12 substantial emission reductions from electric generating
13 units in the non-attainment area.
14
MS. HODGE: You know, could the Agency
15 provide, you know, some more information in this regard?
16 When we look at these tables, we see, you know, the major
17 part of the reductions coming from this rule, the Agency
18 is showing that the major part of the reductions are
19 coming from the units that the Agency says now are not
20 covered by this rule.
21
MR. KALEEL: What we're saying is that the
22 multi-pollutant standard is a way to comply with this
23 rule.
24
MS. HODGE: And would you be willing to
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1 provide us some more information on whether these
2 reductions are based upon the multi-pollutant strategy --
3
MR. KALEEL: Yes, of course.
4
MS. HODGE: -- or upon these just percentage
5 reductions in this table?
6
MR. KALEEL: Sure, we'd be happy to provide
7 more information.
8
MS. HODGE: Okay. I'm sorry --
9
MS. BASSI: That's okay.
10
MS. HODGE: -- Miss Bassi. Go ahead. Thank
11 you.
12
MS. BASSI: To add on to Miss Hodge's
13 question, when you were calculating the reductions from
14 the multi-pollutant standards that are applicable -- that
15 you assume will be applicable to the power plants that
16 are affected by this rule, does that -- is that the
17 state-wide application of that -- of those -- of the MPS
18 and CPS or is it just the non-attainment area
19 applications?
20
MR. KALEEL: I think what we intend there is
21 that the full system, which may include units within the
22 non-attainment area or not, it's full compliance. It's
23 not compliance just at the units within the boundaries,
24 and it's not just compliance for NOx, but the full
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1 multi-pollutant scenario that's -- that is already part
2 of the Board's rules.
3
MS. BASSI: So just as an example, I believe
4 Ameren has no units that are located within the
5 non-attainment areas.
6
MR. KALEEL: I think that's right, yeah.
7
MS. BASSI: And so Ameren's reductions are
8 included where?
9
MR. KALEEL: I don't believe that they are,
10 but I need to confirm that.
11
MS. BASSI: Okay. They're not included.
12 Not included?
13
MR. GUPTA: Mr. Kaleel, if I could answer
14 that question? Okay. In this table, which is C-2, only
15 the sources in non-attainment area is what is included,
16 EGU sources, not outside non-attainment areas.
17
MS. BASSI: Looking, then, at the Metro East
18 portion of C-2, for EGU coal-fired boilers, are those
19 tons then totally attributable to Dynegy?
20
MR. GUPTA: Yes.
21
MS. BASSI: And two -- only two of Dynegy's
22 plants?
23
MR. GUPTA: That's correct.
24
MS. BASSI: Okay.
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1
HEARING OFFICER FOX: I --
2
MS. BASSI: You ready?
3
MS. HODGE: Yes.
4
HEARING OFFICER FOX: Oh, very well.
5 Ms. Bassi, I think that would wrap up your follow-ups on
6 question number 27 specifically. Am I correct in
7 understanding that?
8
MS. BASSI: That's correct.
9
HEARING OFFICER FOX: Excellent. Why don't
10 we move on to question number 28. Do you have follow-up
11 on that?
12
MS. BASSI: No follow-up.
13
HEARING OFFICER FOX: Does any other
14 participant wish to follow up on the Agency's answer to
15 Midwest Gen question number 28? Seeing no indication
16 that there is, let's proceed, Ms. Bassi, to number 29.
17
MS. BASSI: No follow-up.
18
HEARING OFFICER FOX: Follow-ups on the part
19 of anyone else? Yes. It's Mr. Dennis. Did I recall
20 correctly?
21
MR. DENNIS: Correct.
22
HEARING OFFICER FOX: Please go ahead.
23
MR. DENNIS: Just one question with regards
24 to residual oil and particularly low-nitrogen residual
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1 oil. Does anyone from the Agency panel know whether
2 low-nitrogen residual oil is available in significant
3 quantities in Illinois?
4
DR. STAUDT: Well, I don't know, but we show
5 information that where -- with residual fuel oil, there's
6 information and data in the TSD that describes emissions
7 reductions using combustion controls and overfire air
8 that are able to get emissions down to the level in the
9 TSD, so it may not be low-nitrogen -- we don't know. We
10 don't know whether low-nitrogen residual oil is available
11 or not, but we do believe that combustion controls or
12 combustion controls in combination with SNCR will enable
13 people firing residual fuel oil to get below the level
14 that's in the TSD and the rule.
15
MR. DENNIS: Nothing more.
16
HEARING OFFICER FOX: Nothing further,
17 Mr. Dennis? With regard to question number 29, any other
18 follow-ups or clarifications? Ms. Bassi, it looks like
19 we're ready for question number 30, if you have follow-up
20 on that.
21
MS. BASSI: I do have some follow-ups on 30.
22
HEARING OFFICER FOX: Please go ahead.
23
MS. BASSI: Question 30 regards wood-fired
24 boilers, and this kind of is along the same lines as some
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1 questions that Miss Hodge was asking earlier, but if
2 there are no wood-fired boilers currently subject to this
3 rule, why would the rule address wood-fired boilers? And
4 I recognize that the language of the rule does not
5 address wood-fired boilers specifically, but you discuss
6 wood-fired boilers in the TSD.
7
DR. STAUDT: Yeah. The reason I described
8 wood-fired boilers for that, there's -- I gave it as
9 examples of -- primarily for SNCR, to show how SNCR has
10 been employed on wood-fired boilers and to achieve NOx
11 reductions. Now, again, I state in the TSD that I don't
12 believe that there are -- you know, to my knowledge,
13 there aren't any wood-fired boilers. And there was
14 another question, a prefiled question -- I'm not sure who
15 prefiled it --
16
MS. BASSI: It was me.
17
DR. STAUDT: -- what was the relevance of
18 the wood-fired boilers, would you expect the cost to be
19 similar, and it really had to do with relating that you
20 can get NOx reductions with SNCR, and the data on some of
21 these wood-fired boilers in terms of costs is really --
22 is relevant, okay, and I provide an answer regarding the
23 other question about how information on the cost of SNCR
24 for wood-fired boilers is relevant to other forms, other
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1 types of -- other boilers with different fuels.
2
MS. BASSI: And this may not, again, be a
3 question specifically for Dr. Staudt, but if there are
4 wood-fired EGU boilers in the non-attainment areas, what
5 subpart do you think they are subject to? M or D? M is
6 the subpart for fossil fuel-fired EGUs. D is the subpart
7 that's apparently applicable to everything else
8 boiler-related.
9
MR. KALEEL: We don't exclude wood-fired
10 boilers from either definition. I think the definition
11 is for most of the boilers, whether or not it's a solid
12 fuel, and wood would be included within our expectation
13 of what a solid fuel is. Whether it's an EGU I think has
14 to do with how much electricity they sell, and I think
15 it's -- specifically subpart M is greater than 250 -- 25
16 megawatts. I'm sorry.
17
MS. BASSI: But does not subpart M say it's
18 a fossil fuel-fired stationary boiler?
19
MR. KALEEL: Yes.
20
MS. BASSI: Without saying that it's a -- I
21 think the new language that we are proposing adds that
22 it's an electric generating unit; is that correct?
23
MR. KALEEL: I think that's right.
24
MS. BASSI: Okay. And -- But there is no
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1 new definition of fossil fuel-fired proposed, correct?
2
MR. KALEEL: That's right.
3
MS. BASSI: Okay. And the definition of
4 fossil fuel-fired I won't get into at the moment, but it
5 requires a certain amount of fossil fuel to be fired,
6 correct?
7
MR. KALEEL: That's right.
8
MS. BASSI: That just sounds so repetitious,
9 doesn't it? Is wood considered a fossil fuel?
10
MR. KALEEL: No.
11
MS. BASSI: So then back to my question.
12 Would a wood-fired EGU be subject to M or D? It seems to
13 me it would be subject to D, and I just wondered if you
14 concur.
15
MR. KALEEL: Just a moment. I think our
16 understanding is that it would be considered an
17 industrial boiler.
18
MS. BASSI: Okay. Thank you. That's all I
19 have on that one.
20
HEARING OFFICER FOX: Did anyone else have
21 follow-up or clarification with regard to question number
22 30? Seeing none, Ms. Bassi, that brings us of course to
23 31 regarding pulverized coal and wall-fired boilers.
24
MS. BASSI: No questions.
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1
HEARING OFFICER FOX: No questions? Any
2 other follow-up or clarifications? Seeing none,
3 Ms. Bassi, that brings us, of course, to 32.
4
MS. BASSI: No questions.
5
HEARING OFFICER FOX: Very well. On any
6 other part? Mr. Dennis, I see you have a question.
7
MR. DENNIS: Yes. With regard to Table 2-2,
8 I think the point is being made that the proper retrofit
9 performance is reflected by this table, but looking at
10 the table, I believe the first two entries on it -- and
11 I'm going by memory because I don't have it in front of
12 me -- but I believe the first two entries are labeled as
13 retrofit?
14
DR. STAUDT: Yes.
15
MR. DENNIS: And the remainder of the
16 entries in that table are not labeled as retrofits.
17
DR. STAUDT: Well, that's true. It says
18 that.
19
MR. DENNIS: So may we presume that those
20 are new installations, then?
21
DR. STAUDT: I can't state that they
22 necessarily are or not new installations. I'd have to
23 look back at the original document this came from. The
24 original document has more information on it.
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1
MR. DENNIS: Also the last category there, I
2 believe less than 20 ppm?
3
DR. STAUDT: Yes.
4
MR. DENNIS: And looking at that, are two of
5 those installations actually recording levels higher than
6 20 ppm?
7
DR. STAUDT: Yes, but again, our rule that
8 the rule has proposed is, like, 0.08 pound per million
9 BTU, which is well above that, so the point being that
10 the technology that can get you 0.08 is probably on the
11 order of about 60 ppm, and so the technology is there to
12 get you below 60 ppm.
13
MR. DENNIS: If those -- If the entries on
14 that table, the ones that are not labeled as retrofits,
15 if those are all in fact new installations, do they
16 demonstrate anything about retrofit performance
17 capability?
18
DR. STAUDT: Well, yes, in terms of -- you
19 know, they reaffirm that these emissions levels are
20 possible, the fact that you got -- the fact that you've
21 got, you know, retrofits there that are, you know, 4 to 7
22 ppm, and I don't know that the other ones are not
23 retrofits.
24
MR. DENNIS: But if they were new
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1 installations, would they not demonstrate the capability
2 of that level of performance on a new installation but
3 not necessarily for the retrofit?
4
DR. STAUDT: Just if you'll bear with us,
5 we're getting some more information. I think a question
6 came up as well I think in some of the prefiled questions
7 relating to this table, and I want to go back. There
8 are -- If you go to the original source document, there
9 are more than -- a lot more than two retrofits here. I'm
10 not sure why on that table I only show two, but this is
11 an attachment here that has, you know, on the first page
12 one, two --
13
MS. ROCCAFORTE: I'd like to clarify,
14 Dr. Staudt. It's attachment number 8 listed on
15 attachment A that was with the initial filing.
16
HEARING OFFICER FOX: It was specifically an
17 attachment to the TSD, Ms. Roccaforte?
18
MS. ROCCAFORTE: Correct.
19
HEARING OFFICER FOX: Thank you.
20
DR. STAUDT: I've already counted nine
21 retrofits, ten, eleven, twelve. I mean, there are quite
22 a number of retrofits here listed on this attachment to
23 the TSD, so, you know, as I pointed out, it's -- you
24 know, it's something that -- even though the other ones
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1 don't say retrofit, I have -- I don't have here -- I'm
2 not going to cross -- I don't know if you want me to
3 cross-check how many of these lists on Table 2-2 are
4 listed here as retrofits or not, but there are a lot of
5 other retrofits in this document.
6
MR. DENNIS: I think it's a significant
7 point that whether a new unit is achieving this level of
8 performance versus a retrofit, because I think the rule
9 that's -- the proposed rule is really aimed at requiring
10 retrofit control on sources and not -- it's -- I don't
11 think it's a question here what that new source is going
12 to achieve a very low level of NOx. I think the real
13 question is what can be achieved on a retrofit at
14 different sources throughout the state, some of which
15 might be 70 years old.
16
DR. STAUDT: Well, I think as we discussed
17 earlier, in fact some of the older boilers, frankly, in
18 general they would -- because of the size of the
19 furnaces, in general they would more likely be easier to
20 attain low emissions levels, because the newer furnace --
21 newer boilers tend to be made more compact to minimize
22 the cost, and one of the factors in designing a low NOx
23 burner, you have to consider basically the volumetric
24 heat release, so you've got -- putting in the same amount
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1 of heat in a smaller space, it makes it tougher to
2 control the NOx. If you're retrofitting an older unit,
3 you know, where there are challenges are you basically
4 have to remove the old burner, put in a new one, you may
5 have to change the refractory, but what these -- this
6 data shows is that these emissions levels are being
7 achieved on retrofit units. It's not --
8
MR. DENNIS: On at least two units.
9
DR. STAUDT: Well, I count, though, of the
10 ones here, one, two, three --
11
HEARING OFFICER FOX: Dr. Staudt, for the
12 record, again, you're referring to the attachment 8 to
13 the TSD.
14
DR. STAUDT: I'm referring to the TSD.
15
MS. HODGE: Could we -- May I clarify?
16 Attachment A?
17
MS. ROCCAFORTE: 8. Number 8.
18
MS. HODGE: Attachment 8.
19
DR. STAUDT: Attachment 8, yes.
20
HEARING OFFICER FOX: Ms. Roccaforte, do you
21 have copies of that that we could in effect readmit as a
22 hearing exhibit since there appear to be some questions
23 about it?
24
MS. ROCCAFORTE: We can make copies.
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1
HEARING OFFICER FOX: Very good. Would --
2
MS. HODGE: Is that in the copy of the TSD
3 that was filed with the Board?
4
MS. ROCCAFORTE: I don't believe all of the
5 attachments were electronically available.
6
MS. HODGE: Oh, okay.
7
HEARING OFFICER FOX: That would be as a
8 matter of volume, but what I will certainly pledge to do,
9 Ms. Hodge, during the break is speak with our clerk and
10 at least ask him to specifically scan to the Board's Web
11 page the attachment 8 -- I'm sorry. It's attachment 8 --
12
MS. HODGE: 8.
13
HEARING OFFICER FOX: -- appendix A to the
14 TSD.
15
MS. ROCCAFORTE: In the motion for waiver of
16 copy requirements, at the end of that motion is a list of
17 all of the attachments to the TSD. The first one is the
18 Clean Air Act and the second one's the Environmental
19 Protection Act, which we asked that we not have to submit
20 that, so --
21
HEARING OFFICER FOX: Correct.
22
MS. ROCCAFORTE: -- beginning with 3 through
23 68, those are all of the attachments to the TSD, and we
24 are specifically talking about number 8, which is the
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1 letter to Mr. Regulator, New Hampshire Division of
2 Environmental Services, and it's dated May 19, 2006.
3
HEARING OFFICER FOX: And the motion for
4 waiver of file requirements was the waiver of the
5 requirement to file nine original -- nine copies, and I
6 believe the Board granted your motion to the extent of
7 allowing filing of four, so they are certainly part of
8 the record, and because of the volume of the 64 exhibits,
9 I believe, that you referred to, they may not, Ms. Hodge,
10 candidly, all be posted at the Board's Web site, but I
11 can certainly make sure based on the questions about that
12 single document that we get that on sooner rather than
13 later.
14
MS. HODGE: Okay. I would appreciate that
15 very much. Thank you.
16
HEARING OFFICER FOX: Sure.
17
MS. HODGE: And also I would ask the Agency,
18 could you make all of those attachments available for us
19 to come review?
20
MS. ROCCAFORTE: Sure.
21
MS. HODGE: Okay. Thank you.
22
HEARING OFFICER FOX: Sure. Mr. Dennis, I
23 believe we were on you, if you had another -- it looks as
24 if you have another question.
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1
MR. DENNIS: One further question. This
2 response here also references Table 2-3 in the TSD, and
3 that table lists two boilers, two very small boilers, one
4 20.9 million BTU per hour and one 6 million BTU per hour,
5 and I was just wondering, the data that -- there's a
6 column for flow rate in dry standard cubic feet per
7 minute, and on the smaller unit, the numbers there look
8 quite a bit out of line. I just wonder if there's
9 some -- if these results have been somehow confused with
10 other test results from maybe another unit.
11 Particularly, I think the flow rates look to be about two
12 to three times what you would expect from a unit of that
13 size.
14
DR. STAUDT: Yeah, I noticed that. That's
15 something -- I'm not sure -- I'm looking here at the
16 Patton State Hospital. That's the one, Patton State
17 Hospital, boiler number 3?
18
MR. KALEEL: That's one of them, yeah.
19
DR. STAUDT: Yeah. See's Candies. Those
20 are the numbers that are in this document, so I can't
21 speak to, you know, why those numbers are what they are,
22 so those are the numbers that are in this -- that are
23 reported in this document. Whether or not they're a typo
24 from originally put in by Cleaver-Brooks, I can't say as
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1 far as those flow rates are concerned.
2
MR. DENNIS: Nothing further.
3
HEARING OFFICER FOX: Thank you, Mr. Dennis.
4 Ms. Bassi, I believe we were -- and forgive me if I'm
5 mistaken -- addressing follow-ups on question number 32;
6 is that correct?
7
MS. BASSI: That is correct.
8
HEARING OFFICER FOX: Did you have any
9 further follow-ups on your answers to your own questions?
10
MS. BASSI: No.
11
HEARING OFFICER FOX: Any other
12 participants? Why don't we proceed to number 33,
13 Ms. Bassi, if you're --
14
MS. BASSI: No questions.
15
HEARING OFFICER FOX: No questions at all?
16 Any other participants with questions on -- follow-ups on
17 that answer? Ms. Bassi, number 34. There's --
18
MS. BASSI: No questions.
19
HEARING OFFICER FOX: Any other
20 participants? Mr. Dennis on question number 34.
21
MR. DENNIS: I believe the answer's
22 incorrect on 34. The range of 100 to 600 boiler
23 horsepower should be somewhere in the -- should be
24 something close to a range of 4 to 20 million BTU per
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1 hour, I believe.
2
HEARING OFFICER FOX: Mr. Dennis, do you
3 have a question based on that observation for the Agency?
4
MR. DENNIS: Well, no, except that I think
5 that this -- it would deserve a correction, a corrected
6 response, I think.
7
HEARING OFFICER FOX: What -- You need to
8 pose a question to the Agency, Mr. Dennis.
9
MR. DENNIS: I'm sorry. With a range of 100
10 to 600 horsepower, would the Agency agree that that would
11 be roughly equivalent to a more than 20 million BTU per
12 hour heat input capacity?
13
DR. STAUDT: That's something I'll look at.
14
MR. DENNIS: Thank you.
15
HEARING OFFICER FOX: Thank you, Mr. Dennis.
16 Did you have further questions?
17
MR. DENNIS: Nothing further.
18
HEARING OFFICER FOX: Any other participant
19 with regard to Midwest Gen's question number 34,
20 follow-ups or clarifications? Ms. Bassi, that brings us
21 naturally to number 35, if you have a --
22
MS. BASSI: I do have some questions about
23 35, and again, I'm not sure Dr. Staudt -- I would imagine
24 that you provided some of this information to the Agency,
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1 but you may not be the appropriate person to answer, but
2 I guess you all can figure it out.
3
DR. STAUDT: I'll do my best.
4
MS. BASSI: What makes the trainers on a
5 combustion tuning training course certified or capable of
6 providing such training? In other words, is there some
7 certifier of the trainers, a national organization or
8 something that does this, or is it at a college? And I
9 went onto this Web site that you --
10
DR. STAUDT: ABMA?
11
MS. BASSI: Yeah.
12
DR. STAUDT: Yes.
13
MS. BASSI: But what makes -- why would they
14 be the ones?
15
DR. STAUDT: Well, the ABMA is the American
16 Boiler Manufacturers Association, and they're the guys
17 who build the boilers. They are an association of
18 companies, such as Cleaver-Brooks, but other boiler
19 manufacturers as well, and most of the people who supply
20 these burners and these boilers have their own courses
21 that they provide to a -- they provide to the -- to
22 people who operate these boilers, so in terms of
23 training, these are people who are typically employees
24 and experts from the actual boiler company who understand
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1 their equipment. Is there a larger certifying agency?
2 I'm not sure about that.
3
MS. BASSI: So then basically, the rule is
4 requiring that sources go back to an outfit like the ABMA
5 or go online to find out where they can get these
6 certified training courses; is that correct?
7
MR. KALEEL: That's my understanding.
8
MS. BASSI: Would --
9
DR. STAUDT: I think the intent of the rule
10 is really to make sure -- I'm just -- and this really
11 applies to combustion tuning. They want to make sure
12 that it's done by somebody who is knowledgeable and
13 competent, and it's -- and it would be up to the Agency
14 to determine if there's some other way to do that, to
15 verify that somebody is knowledgeable and competent, but
16 obviously I think you'd want the combustion tuning done
17 by somebody who knew what they were doing.
18
MS. BASSI: Would the Agency be -- Would the
19 Agency accept some form of on-the-job training or
20 on-the-job certification?
21
MR. KALEEL: I think we'd be open to
22 discussing that. Again, I guess I concur with
23 Dr. Staudt's observation about the intent, is that people
24 that are maintaining the boilers and performing the
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1 tuning have some qualification to do that.
2
MS. BASSI: How would this be implemented?
3 Is there a -- Would there be -- I see the question in
4 your face. Would there be a permit requirement and the
5 permit would provide some detail, or the permit just says
6 you have to have combustion tuning and then everybody
7 kind of guesses?
8
DR. STAUDT: Could I -- Every -- It's my
9 understanding that any place where you have boilers, you
10 actually have a licensed boiler operator. He's got to be
11 licensed either by the State or somebody, somebody who --
12 you know, you can't -- so that's my understanding, and I
13 know at least in Massachusetts, you know, the companies,
14 they have to have somebody who's got a license there, and
15 perhaps it has -- perhaps if there's such a thing -- such
16 a person in Illinois, at facilities in Illinois, that
17 might be the person under whose direction that might be
18 done.
19
MS. BASSI: Do you guys at the Agency know
20 if that's a requirement in Illinois?
21
MR. KALEEL: We don't know if that's a
22 requirement. I think the way the rule reads is that the
23 operator take a class and maintain a record that says
24 they have taken a class. It's not -- In my opinion, it's
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1 not an overly burdensome thing, and I guess maybe I'm
2 speculating here a little bit, but I would guess that
3 most companies would want to have the guy that's
4 operating their boiler know what he's doing, so -- and I
5 don't think it's asking much more than that.
6
MS. BASSI: I suspect the companies don't
7 disagree with what you're telling them, but the concern
8 seems to be with where one gets the class. If they have
9 to fly to Alaska to get the class, is that outrageous?
10 That's, I think, the issue. We'll go on. We're done.
11
HEARING OFFICER FOX: Any other questions on
12 number 35 regarding the training? Ms. Bassi, why don't
13 we go ahead to number 36, if you --
14
MS. BASSI: No questions.
15
HEARING OFFICER FOX: No questions
16 from Midwest Generation. Mr. Dennis on number 36.
17
MR. DENNIS: Just one quick one. How does
18 one make sure that the injection ports or nozzles are
19 placed in the proper zones?
20
DR. STAUDT: Normally what's done in
21 these -- in the design of these systems -- and I can, you
22 know, speak from experience because I used to be in the
23 business of designing and selling and starting these
24 things up -- what happens is initially you usually do
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1 some -- in designing these systems, you do some testing
2 to get -- to measure the temperatures in the furnace.
3 There is computer modeling typically done. They model
4 the furnace on a computer and then they simulate, you
5 know, putting injectors at different locations to get
6 good distribution, and they do that under different
7 conditions, and that's how these systems are typically
8 designed. That's how the injection points are
9 determined. Of course after you start the system up, you
10 then verify the performance of the system by measuring
11 the performance in terms of NOx levels and ammonia slip.
12
MR. DENNIS: Would that -- Is that what's
13 known as I believe a computational fluid dynamic study, a
14 CFD?
15
DR. STAUDT: Yes. Typically, yeah, that's
16 what you might call it.
17
MR. DENNIS: And for an industrial-sized
18 stoker boiler, how -- what would the -- a study, a CFD
19 study, cost for a boiler of that size?
20
DR. STAUDT: Well, typically it would be
21 part of your -- if you were going to put one of these
22 systems in, it would be part of the contract. It would
23 be a relatively small part of the total contract, so, you
24 know, might be -- the study might be 20, 30 thousand
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1 dollars, but, you know, if you're just going to spend
2 half a million dollars on a piece of equipment or more,
3 that's -- it's basically a portion of the engineering.
4 It's really a portion of the engineering of the system.
5
MR. DENNIS: Thank you. Nothing more.
6
HEARING OFFICER FOX: Nothing further?
7 We've been at it for quite a little while and I'm sure
8 people would appreciate a chance to take a break. Why
9 don't we do so and resume right at three o'clock where
10 we've left off with question number 37 of yours,
11 Ms. Bassi. Thanks, everyone.
12
(Brief recess taken.)
13
HEARING OFFICER FOX: Ms. Bassi, I had
14 marked that we had gotten to Midwest Generation's
15 question number 37. Why don't we dive right in and see
16 if whether you have a follow-up on that one.
17
MS. BASSI: 37, I have no questions.
18
HEARING OFFICER FOX: Very good. Any other
19 participants with a question about 37? Mr. Dennis,
20 please go ahead.
21
MR. DENNIS: One quick one. If -- In
22 designing SNCR for an industrial boiler, if there are
23 multiple fuels used in the boiler, does that complicate
24 the task and perhaps increase the cost and complexity of
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1 the project?
2
DR. STAUDT: You know, it would have a
3 slight increase to the cost. I mean, what you might have
4 to do is have some additional injectors or something like
5 that. You would have -- You might want to have some
6 control logic that if one day you're burning coal and the
7 other day you're burning wood, you might have a, you
8 know, different set of controls programmed in, you know,
9 so when you're firing coal versus firing wood, but
10 it's -- it can -- it's something that can be accommodated
11 in these systems.
12
MR. DENNIS: Okay. Thank you.
13
HEARING OFFICER FOX: Anything further,
14 Mr. Dennis?
15
MR. DENNIS: No.
16
HEARING OFFICER FOX: Any other participant
17 follow-up? Ms. Hodge?
18
MS. HODGE: May I just follow up on that?
19 What about if you're using a combination of these
20 different fuels? Would that affect your answer?
21
DR. STAUDT: Oh, it wouldn't affect my
22 answer. I mean, you could -- you know, in many cases
23 people coal fire -- make -- you know, for example, you
24 know, if we're talking about stoker-fired units, they can
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1 burn anything that can be burned pretty much, so they may
2 put in coal, they may mix in some wood, you know, wood
3 material, and that's -- it's not unusual to sometimes
4 change it, change what is being done, fired, and it's,
5 you know, something that's routinely done with these
6 systems. You can design for it, you can accommodate it.
7 You know, you just need to think it, you know, when you
8 design the system. You -- As I said, you may put it --
9 you know, you may locate the injectors in a sightly
10 different location depending upon, you know, your
11 expected temperature, where the temperature is in the
12 furnace, but it might slightly change the design, but
13 it's not going to make it dramatically more or less
14 expensive.
15
MS. HODGE: Okay. Even if that combination
16 is changing perhaps on a frequent basis?
17
DR. STAUDT: Oh, yeah.
18
MS. HODGE: Your answer would be the same?
19
DR. STAUDT: Yeah, because what happens
20 is -- you know, these systems have been designed for lots
21 of applications where -- I mean, this does come up. I
22 mean, there are literally hundreds of these systems in
23 use, so you have to believe that this has come up, and I
24 know it's come up in many applications, and there are
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1 ways to design for it, okay? It's not something that
2 means the technology can't be used. There are just ways
3 you design the system to accommodate them, you know.
4
MS. HODGE: Thank you.
5
HEARING OFFICER FOX: Anything further,
6 Ms. Hodge? Any other questions with regard to number 38?
7
MS. BASSI: No.
8
HEARING OFFICER FOX: Seeing none,
9 Ms. Bassi, let's move on to -- I'm sorry. That was 37.
10 We're now moving on to 38. I believe that was my
11 mistake.
12
MS. BASSI: None on 38.
13
HEARING OFFICER FOX: None on 38? On the
14 part of any other participant, follow-ups or
15 clarifications on 38? Ms. Bassi, number 39.
16
MS. BASSI: 39, I have just a couple of
17 quick ones. Does your response here mean -- and we were
18 talking about this a little bit earlier. Does your
19 response here mean that the cost for wood-fired EGUs is
20 about $15 per kilowatt? I think that's what it says.
21
DR. STAUDT: Well, it says --
22
MS. BASSI: This is your response to number
23 39.
24
DR. STAUDT: Well, I think the -- my
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1 question -- your question says, "Page 30 of the TSD
2 states, 'For EGUs SNCR capital cost is in the range of
3 about $15 per kilowatt, and in most cases NOx reductions
4 in the range of about 30 percent are possible.' How does
5 this translate to dollars per ton of NOx removed?" What
6 I did is I referred back to Figures -- my answer, Figures
7 2-14 and 2-14b, okay, of the TSD, if I can find where
8 that page is.
9
MS. BASSI: And I would also --
10
DR. STAUDT: Page 32.
11
MS. BASSI: -- note that my follow-up
12 question is following on a couple of questions that
13 previously were talking about wood-fired boilers, so it's
14 not, like, out of the blue in the transcript.
15
DR. STAUDT: Oh, no, that's all right. So,
16 I mean, if you're looking specifically -- I -- the answer
17 that's here is really -- you know, I -- what I understood
18 you to mean, how do you translate the capital -- the
19 estimated capital cost for an EGU would be $15 per
20 kilowatt, in that range, and what you can do is you can
21 see what cost effectiveness is. If you want to look at
22 calculated cost effectiveness, look at Figure 2-14a.
23 This is cost effectiveness for ICI boilers, and they took
24 50 of them and they plotted it, but for an EGU, since
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1 your question in question -- your question here dealt
2 with -- 39, dealt with EGUs, you go to the far right,
3 okay, because that's at the high end of it where these
4 lines kind of flatten out, and you can see for an EGU for
5 annual operations, you might expect -- you know, for a
6 large boiler, annual operations, you might see something
7 in the range of $1500 per ton of NOx removed.
8
MS. BASSI: Okay. So does -- So I think the
9 answer to my question was yes.
10
DR. STAUDT: I'm not sure what -- well, I'm
11 looking at the answer to question 39.
12
MS. BASSI: Right.
13
DR. STAUDT: The answer to 39 is --
14
MS. BASSI: And then my follow-up was, does
15 this statement mean that the cost for wood-fired EGUs is
16 $15 per kilowatt?
17
DR. STAUDT: Oh, no, no, because it depends
18 upon the size, as I talked about, for a specific -- for a
19 smaller -- as you -- if you look at that figure of 2-14a,
20 as you can notice, as the unit size gets smaller, it
21 starts to curve up, starts to get higher and higher, and
22 that's because the normalized -- what I will call
23 normalized cost say on a dollar per million BTU basis --
24 and that's shown in Figure 2-14b -- that tends to get
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1 higher as it gets smaller, so what it does on the cost
2 effectiveness, the dollars per ton of NOx removed, that
3 tends to make it get more expensive as you get to smaller
4 and smaller units, all right, so if you had a wood-fired
5 boiler that was, you know, 145, 200 million BTUs per
6 hour, you might expect a cost effectiveness of in the
7 range of maybe around $2,000 per ton of NOx versus the
8 1500 I discussed earlier.
9
MS. BASSI: Thank you.
10
DR. STAUDT: Sure.
11
HEARING OFFICER FOX: Anything further,
12 Ms. Bassi? Any other questions regarding Midwest
13 Generation's question number 39 and the answer to it?
14 Ms. Bassi, let's move on to number 40, if you have a
15 follow-up.
16
MS. BASSI: Yes, I do have. With respect to
17 your answer to number 40, is the argument or statement
18 that the higher baseline NOx -- that the higher the
19 baseline NOx and therefore the more NOx to be removed,
20 the lower the cost per ton in an SCR application, is that
21 what this is saying effectively?
22
DR. STAUDT: No. This is question 40,
23 right?
24
MS. BASSI: Yeah.
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1
DR. STAUDT: Okay. No, what I did there --
2 and let's just go to the TSD. I don't know if people
3 have it in front of them. I think you're talking about
4 these Figures 2-17 versus 2-18, and what I talk about is,
5 you know, the -- in Figure -- in question 40 you ask
6 about do I think dollar per million BTU is a better
7 measure than -- better measure for RACT than dollars per
8 ton, and I say no, because, you know, I'm not suggesting
9 that. The reason I put that information in there on the
10 dollars per million BTU, it's the same reason that why
11 for an electric utility might be -- from an electric
12 utility perspective, you might be interested in what's
13 the impact on your generating cost, right, and from an
14 industrial boiler who -- they may use steam to produce
15 power, they may produce the steam to -- for process. You
16 really -- The best way to normalize it is on a dollar per
17 million BTU basis, and it's really -- you know, that may
18 be relevant to an industrial boiler operator. That's
19 really why I put it in there. But it's not to argue that
20 it should be -- that that's a better measure for RACT.
21
MS. BASSI: No, I -- and that's --
22
DR. STAUDT: It's just --
23
MS. BASSI: I'm not quibbling with your
24 response at all.
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1
DR. STAUDT: Okay.
2
MS. BASSI: My question is is that if the --
3 if you have a higher baseline of NOx and therefore you
4 have more NOx to remove, would the cost per whatever
5 metric you're using be lower as a result if you're
6 applying an SCR? So if you apply an SCR, if you have a
7 lot of NOx to remove, your cost per metric to remove that
8 NOx is going to be lower; is that correct?
9
DR. STAUDT: Yeah.
10
MS. BASSI: That's your point.
11
DR. STAUDT: The lower initial NOx level,
12 you know, if you're starting at a lower initial NOx
13 level -- let's look at Figure 2-17, because that
14 basically gets to that point.
15
MS. BASSI: Okay.
16
DR. STAUDT: You've got three data points
17 here. One is 0.4, the other's 0.5, the other's 0.6. And
18 bear in mind, I mainly developed this with the interest
19 of industrial boilers that have, you know, maybe a 0.13
20 pound per million BTU already. As the NOx level gets
21 lower, you can see that -- compare the 0.4 line to the
22 0.6 line for baseline NOx level. You can see it's more
23 expensive for the 0.4 line, which is the -- I think the
24 point you're trying to make, is that as the starting
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1 point gets lower, the baseline level gets lower. As
2 you -- The way you do the calculations, the actual -- the
3 cost in dollars per ton of NOx removed gets bigger
4 because the dollar part on the top goes down but doesn't
5 go down very much because you're using less ammonia, but
6 the denominator gets much smaller, so the -- you know,
7 the result of the arithmetic of the numerator times
8 the -- over the denominator is that it gets higher.
9
MS. BASSI: Okay. Thank you.
10
HEARING OFFICER FOX: Anything else,
11 Ms. Bassi, on number 40?
12
MS. BASSI: Actually, I do have one other
13 thing. The rule provides for the use of averaging plans
14 within a source, and so if you're using an average of --
15 if you use an averaging plan, is it not the case that
16 you're looking at the total amount of NOx removed among
17 all the units that are part of the averaging plan, and
18 how would that impact your cost analysis? With an
19 averaging plan, you have more -- you're just lumping it
20 all together. Does that have an impact on your NOx -- on
21 your cost analysis, and what is that impact?
22
DR. STAUDT: Well, what would happen on an
23 averaging plan, an averaging plan is sort of like
24 operating -- almost like operating over a system-wide
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1 cap. If you're looking at -- If you know what your heat
2 input's going to be, it's really a -- like having a cap,
3 so what that enables you to do -- it actually is very
4 helpful, because what it enables you to do is put control
5 with -- if you have one big source, you can put -- invest
6 the money on, say, an SCR on the big source and then you
7 don't have to do as much on the small sources, so that
8 can affect -- if you look at how you get to the end
9 point, it would actually end up helping you.
10
MS. BASSI: So it could help to reduce
11 costs.
12
DR. STAUDT: It could help to --
13
MS. BASSI: At least in this type of metric,
14 or any type of metric, perhaps.
15
DR. STAUDT: Well, it would -- you know,
16 it's certainly helpful in terms of reducing your overall
17 costs versus if you impose the equivalent emission rate
18 for every unit. I mean, it would be more expensive to
19 have one emission rate on each and every unit and impose
20 that on every unit typically than if you have a -- the
21 equivalent of a system-wide cap.
22
MS. BASSI: Okay. That's all.
23
HEARING OFFICER FOX: Very well. Any other
24 questions on the basis of number 40, the other
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1 participants? Ms. Bassi, to number 41. There's a
2 one-word answer for you to respond to if you'd like.
3
MS. BASSI: Why would retrofit issues be
4 greater for EGUs than for industrial boilers? And again,
5 this refers to page 36 of the TSD.
6
DR. STAUDT: If you could help me and just
7 point me to where on that page.
8
MS. BASSI: Well, I would love to. I think
9 what I'm referring to is at the end, the last couple of
10 sentences of the first paragraph that begins with "as a
11 result."
12
DR. STAUDT: It's 36?
13
MS. BASSI: On page 36. I don't know why I
14 have 36 written down at the moment. Let me ask it a
15 different way. Are retrofit issues more problematic for
16 EGUs than they are for industrial boilers?
17
DR. STAUDT: Well, you know, each facility
18 is going to have its own unique, you know, issues, so --
19
MS. BASSI: So there's not a generalization?
20
DR. STAUDT: Well, it, you know, depends
21 upon the technology, it depends upon the facility you're
22 talking about, so, you know, frankly, it will depend.
23
MS. BASSI: Okay.
24
DR. STAUDT: Yeah.
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1
MS. BASSI: We'll let it go. No further on
2 41.
3
HEARING OFFICER FOX: Any other questions on
4 41? Mr. Dennis?
5
MR. DENNIS: Yes. In the -- Considering
6 a -- perhaps a worst-case example of an industrial boiler
7 retrofit for an SCR, in the -- this example, the boiler
8 room is very crowded. The boiler house is surrounded by
9 other process buildings. The overhead space is taken up
10 with pipe racks. There's no lay-down area immediately
11 adjacent to the plant and there are infrastructure
12 issues, meaning that any electrical system requirements
13 are going to prompt an upgrade. Would it be reasonable
14 in a situation like this to ratio -- to expect an
15 increased project cost of perhaps two to three times
16 the -- what a normal cost would be?
17
DR. STAUDT: Well, let's -- your question
18 had to do with SCR, and as I stated, based upon the
19 emission limits that are in the rule, I don't see why
20 someone -- I don't see why an industrial boiler owner
21 would install SCR. Be that as it may, if someone chose
22 to install SCR, even though I feel confident that there
23 are other technologies that can get you to below these
24 limits for less money, sure, if you have a very
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1 constrained boiler, it's going to cost more money to
2 install something like SCR where that takes up some
3 space. But as I say, I don't -- you know, the limits
4 here for the industrial boilers should not force people
5 to put -- install SCR, and that was -- you know, frankly,
6 that was something that I was hoping to -- you know, when
7 we developed the rule, I didn't think it was -- you know,
8 we'd be doing that. I didn't think we'd be pushing
9 people towards SCR.
10
MR. DENNIS: Thank you. Nothing.
11
HEARING OFFICER FOX: Nothing further?
12
MR. DENNIS: Nothing further.
13
HEARING OFFICER FOX: Any other questions
14 based on number 41? Seeing none, Ms. Bassi, that brings
15 us, of course, to number 42 if you have a follow-up.
16
MS. BASSI: Yeah. I believe the Agency's
17 response to question 7, if you can look back to my
18 question 7 quickly, is that the RACT range is 2500 to
19 3,000 dollars per ton as a cost effectiveness number; is
20 that correct?
21
MR. KALEEL: That's correct.
22
MS. BASSI: Could you tell us in what year
23 dollars that 2500 to 3,000 dollars per ton is, and
24 whoever was doing all that --
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1
MR. KALEEL: Yeah, it's current dollars.
2
MS. BASSI: 2008 dollars?
3
MR. KALEEL: Yes.
4
MS. BASSI: Oh, okay. Do 2008 dollar values
5 fluctuate from day to day? That's a rhetorical question.
6
DR. STAUDT: Last week they did.
7
MS. BASSI: Last week, not this week?
8 That's it.
9
HEARING OFFICER FOX: So noted on the
10 rhetorical nature of the question.
11
DR. STAUDT: Yeah, yesterday they went back
12 up.
13
HEARING OFFICER FOX: Any other --
14 Ms. Bassi, either you or any other participants with
15 additional follow-up on number 42? Seeing none, that, of
16 course, Ms. Bassi, brings us to number 43.
17
MS. BASSI: No questions.
18
HEARING OFFICER FOX: Any other participants
19 with a follow-up on 43? 44, Ms. Bassi, if you have a
20 follow-up.
21
MS. BASSI: No questions.
22
HEARING OFFICER FOX: None there. Any other
23 participants to follow up on 44? Moving ahead to number
24 45 with regard to point sources. Ms. Bassi, a follow-up?
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1
MS. BASSI: Actually, I don't have any more
2 questions for the rest of this.
3
HEARING OFFICER FOX: Very good.
4
MS. BASSI: I do have one on 19 that I would
5 like to go back with Dr. Staudt.
6
HEARING OFFICER FOX: Why don't -- Perhaps I
7 can put to rest numbers 45, 46, 47 and 48? Would any of
8 the other participants aside from Ms. Bassi have specific
9 follow-ups or clarifications with regard to those four
10 questions? Seeing none, Ms. Bassi, you mentioned number
11 19, I believe.
12
MS. BASSI: Number 19 I would like to go
13 back to. Again, I suspect this is a Dr. Staudt question.
14 The answer that you gave to our question here for
15 gas-fired boilers is to see the page -- the Table 2-17a
16 on page 43 of the TSD, and perhaps we were missing
17 something in this, but we don't -- we were unable to draw
18 conclusions on -- based on this table. The table sets
19 forth a bunch of data, but it doesn't tell us how you
20 established 0.08 pounds per million BTU as RACT for the
21 gas-fired boilers.
22
DR. STAUDT: I'm not sure that I answered
23 that. Did I?
24
MS. BASSI: I wondered if you could --
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1
MR. KALEEL: I think what we're pointing
2 back to on Table 2-17 is that there are a range of
3 control options to meet 0.08 at cost ranges that fit in
4 with our idea of what RACT is, so there isn't a specific
5 number there, 0.08, but I think rather what you're seeing
6 is for a range of different boiler sizes that there are a
7 number of control options that could get controlled
8 emissions in the range of 0.08 or less.
9
MS. BASSI: And among those, it appears that
10 SCR is an acceptable RACT technology. Is that so?
11
MR. KALEEL: SCR is an option.
12
DR. STAUDT: Let me add, first of all, you
13 want to look -- notice here that you see some of these
14 are reference 1, and you see low NOx burner partway down
15 there, unit capacity of 50 million BTUs per hour, low NOx
16 burners, 0.08, 0.09. This is reference 1. Reference 1
17 is a 1994 ACT document where this data was just kind of
18 incorporated from the ACT document just so to maybe
19 give -- to kind of put that in there, but recognize that
20 1994 ACT document does not reflect current capabilities
21 for low NOx burners, so there's -- you know, the
22 information in there is informative in some respect, but
23 keep in mind, whatever emission rate you see there, it
24 is -- current low NOx burner technology is capable of
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1 achieving 0.08, you know, pound per million BTU on gas.
2 In fact, if you put in flue gas or circulation, you'll be
3 well below that, so -- and combustion controls are widely
4 regarded as reasonable in cost, so for gas-fired
5 applications, 0.08 is well within the capabilities of
6 state-wide combustion controls, and we provided some more
7 information on what burners can do and -- as part of
8 this, so 0.08 is well within the capabilities of current
9 combustion control technology.
10
MS. BASSI: So then are you saying SCR is
11 not RACT?
12
DR. STAUDT: Well, RACT -- we're
13 establishing emissions limitations for the basis of RACT.
14 If someone chooses to install SCR to achieve that limit,
15 you know, that's up to them, okay? It -- I don't think
16 the Agency's going to tell you you can't install SCR to
17 do that. The Agency -- The proposed rule is to achieve
18 under 0.08 pound per million BTU, and if someone chooses
19 to install SCR, which is more costly, than to install low
20 NOx burners, that's up to them, but most people would
21 install the less expensive approach, I would assume,
22 which is combustion controls.
23
MS. BASSI: All right. Well, let me put
24 this a little -- let me ask a more specific question. If
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1 you look on Table 2-17a, and in the portion of the table
2 that says natural gas-fired watertube field-erected
3 multiple burner as opposed to single burner, and on the
4 fifth one down, it is a 500 million BTU unit. It says
5 SCR, 70 to 90 percent reduction, and the cost range is
6 24 -- effectively 2400 to 7100 or 7200 dollars per ton,
7 so if it got up into that upper ranges, past 3,000
8 dollars per ton, it kind of goes back to a question that
9 I had asked before, is that no longer RACT. So an SCR --
10 if SCR was the only technology available to reach 0.08
11 and it was going to push this source or unit up into
12 the over 3,000 dollar a ton cost effectiveness range,
13 which is within what you've provided here, then would
14 that no longer be RACT under this rule?
15
DR. STAUDT: Well, let's -- maybe there's a
16 misunderstanding here. Table 2-17a is not intended to
17 say that these are all RACT technologies. It's really
18 just there as background information to show what other
19 people have arrived at in terms of cost effectiveness.
20 It's not saying that these are specifically prescriptions
21 for RACT. What is proposed in this rule is an emissions
22 rate that is believed to be achievable at costs that are
23 within the boundaries for RACT. Now, as I stated
24 repeatedly, I would not expect anyone with a gas-fired
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1 boiler who needed to get under 0.08 pound per million BTU
2 to install SCR. I would be astounded if that were --
3 somebody determined that to be necessary. More than
4 likely they would use combustion controls.
5
MS. BASSI: Okay. That's it.
6
HEARING OFFICER FOX: Any --
7
MS. BASSI: On 19.
8
HEARING OFFICER FOX: On number 19? Any --
9 We've gotten to the end of the questions specifically
10 directed to Mr. -- Dr. Staudt. Ms. Hodge, did you have a
11 follow-up?
12
MS. HODGE: Perhaps. I would like to ask a
13 question in follow-up to Ms. Bassi's, and it's very close
14 to her question but I'm not sure we got an answer. What
15 if an industrial boiler must install SCR to meet the
16 0.08?
17
DR. STAUDT: Well, I don't --
18
MS. HODGE: Would it be your opinion that
19 SCR would be RACT in that circumstance?
20
DR. STAUDT: I would -- Well, what I would
21 like to do is see how -- why it's necessary. I would be
22 very surprised if that -- it would be a unique -- very,
23 very unique situation if that were necessary.
24
MS. HODGE: Let's assume that was the
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1 situation.
2
DR. STAUDT: You know, how the Agency or how
3 the Pollution Control Board chose to address that, that's
4 up to them. All I can say is that if somebody told me
5 that I have a gas-fired boiler and the only way I can get
6 to 0.08 pound per million BTU is by installing SCR, I
7 would -- I'd be very surprised. I would say this is an
8 extremely unusual situation and I would need to see some
9 information to persuade me that it was truly necessary,
10 but if that's the case, they -- there may be a way to
11 address it. I --
12
MS. HODGE: So is it possible that it could
13 be outside of the range of what would be determined to be
14 RACT, the cost would be outside of the range?
15
DR. STAUDT: It depends upon what the
16 baseline NOx levels are, okay? You know, we talked
17 earlier about if you're starting at one pound per million
18 BTU with a gas-fired boiler, which is pretty unusual, and
19 you need to put an SCR on to get down to that level,
20 since we're talking about things that I believe are kind
21 of, you know, really, really remote or unusual and kind
22 of at the tail of the normal distribution curve, let's
23 say that you had something that has a very high NOx level
24 and for some reason you have to put SCR in. In that
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1 case, what happens is the denominator, that dollar per
2 ton of NOx, those tons of NOx get to be very big, and so
3 the math actually may bring you well under $3,000 per
4 ton.
5
MS. HODGE: But if the cost were over 3,000,
6 do you think that --
7
DR. STAUDT: Well, that -- you know, it
8 depends upon -- I don't know if from the Agency's
9 perspective they've established a bright line in terms of
10 what RACT is, and they've -- my understanding is that
11 they have not, that there isn't going to be a
12 case-by-case RACT. It's not --
13
MS. HODGE: Thank you. Mr. Kaleel, has the
14 Agency established a bright line?
15
MR. KALEEL: We don't have a specific bright
16 line test. The concept of RACT has been around for a
17 long time, and there have been cases in the case of VOCs
18 where certain companies have argued that the costs are
19 very unreasonable and they have sought some site-specific
20 adjustment to a board proceeding, and I think the same
21 kind of a thing could happen here if costs are really,
22 really unique, really above and beyond -- greatly above
23 and beyond what we've indicated here what we think is
24 appropriate, and then some sort of site-specific action
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1 might be needed, but --
2
MS. HODGE: Okay. And then would the Agency
3 prefer to address that on a case-by-case basis in the
4 context of this rulemaking or would you prefer industries
5 that may find themself -- you know, sources in that
6 position to come to the Agency for assistance?
7
MR. KALEEL: I think we're willing to talk
8 while the rulemaking is going on to the extent that we
9 can, and if we need to adjust something later, we'd be
10 happy to look at that as well.
11
MS. HODGE: Okay. Thank you. That's all I
12 have. Thank you.
13
HEARING OFFICER FOX: Surely, surely,
14 Ms. Hodge. Ms. Bassi, that brings us to the extent of
15 questions directed specifically to Dr. Staudt to the end
16 of Midwest Generation's questions for now. I think we'd
17 established that we would return to those that are
18 directed to Mr. Kaleel, and that brings us to the point
19 in our proceedings, as we discussed this morning, to the
20 questions from ExxonMobil and the answers supplied by the
21 Agency to those, and while those were filed by --
22 Mr. Hinske was the original filer of those questions. I
23 believe, Mr. Elvert, you are here to request any
24 follow-ups or clarifications. I wonder if -- Is that
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1 correct, that you were going to --
2
MR. ELVERT: Yeah.
3
HEARING OFFICER FOX: I wonder if I could
4 impose on you for the benefit both of the Agency and the
5 Board and for the court reporter, would you be available
6 to move up a little closer --
7
MR. ELVERT: Sure.
8
HEARING OFFICER FOX: -- so that you could
9 be a little more audible?
10
MR. ELVERT: Yes.
11
HEARING OFFICER FOX: That would be great.
12 There's an entire table there and there's certainly room
13 for any notes or papers you might have. And I appreciate
14 it. I think that will help simplify things.
15
MR. ELVERT: This'll be real fast.
16
HEARING OFFICER FOX: Great. I will -- Why
17 don't we plan to proceed just as we have with the other
18 entities that have had questions. We'll just go one by
19 one through the total of 28 that you had posed, and if
20 you have no follow-ups or believe that it may have been
21 answered by some of the give and take earlier,
22 Mr. Elvert, we can certainly just move ahead.
23
MR. ELVERT: Yeah. In fact, really all I
24 have is one. All the other ones have been answered
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1 earlier.
2
HEARING OFFICER FOX: Very well. If you
3 would specify which question that is, we can have the
4 Agency provide the follow-up that you're seeking.
5
MR. ELVERT: All right. First, just off the
6 bat, again, my name is Robert Elvert. I'm the midwest
7 state regulatory issues advisor for ExxonMobil, and
8 again, I apologize -- or Mr. Hinske apologizes for not
9 being able to be here. Most of our questions have been
10 already answered either through the original responses or
11 today's hearings. Really the only question we have left
12 is number 16 that we'd like to seek further
13 clarification.
14
HEARING OFFICER FOX: And that question,
15 Mr. Elvert, deals with the Agency's consideration of
16 extending the compliance date; am I correct?
17
MR. ELVERT: Yes, it is.
18
HEARING OFFICER FOX: Very well. Please go
19 ahead.
20
MR. ELVERT: The Agency responded there are
21 considered proposals for a couple of the industrial
22 sectors, and really our question is basically what is the
23 status of those considerations.
24
MR. KALEEL: I mean, we have considered
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1 perhaps some unique circumstances with the two industries
2 that are represented in our response, petroleum
3 refineries and glass melting furnaces. They're -- We
4 don't want to treat them the same. Obviously the
5 industries are different, but in regards to petroleum
6 refineries, we understand that -- you know, the nature of
7 their industry and the impact on the local economy, the
8 need to plan shutdowns on a regular cycle, and we've
9 talked about that with not just ExxonMobil but also Citgo
10 and ConocoPhillips, and I think we need to have some more
11 discussions. We need to understand better what kind of
12 schedules that they're proposing and -- but we are
13 amenable to finding some sort of a relief that allows
14 much of the work that's needed to comply with the rule to
15 occur on normal planned shutdown cycles.
16
HEARING OFFICER FOX: Anything further,
17 Mr. Elvert?
18
MR. ELVERT: That is fine. Thank you very
19 much.
20
HEARING OFFICER FOX: Were any of the other
21 participants wishing to ask -- Ms. Bassi.
22
MS. BASSI: I have a couple of questions
23 about -- I have questions about a couple of them.
24 Number -- The first one is number 12.
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1
HEARING OFFICER FOX: I'm sorry. Number 12,
2 Ms. Bassi?
3
MS. BASSI: Yes.
4
HEARING OFFICER FOX: Sorry to interrupt.
5
MS. BASSI: That's all right. Number 12 is
6 talking about construction permitting, and in this -- in
7 the Agency's response to the question -- let's see. The
8 question was whether the Agency had planned for any
9 expedited preconstruction permitting efforts, and the
10 Agency replied that they have the statute that limits
11 them to 90 days and that things are taking 50 and 60 days
12 to get a permit and that -- and the Agency says that if
13 companies seeking such construction permits can help to
14 ensure quick turnaround by keeping their applications
15 focused only on the controls necessary to comply. My
16 question is, will the Agency keep the construction
17 permits similarly focused?
18
MR. KALEEL: I think that's our intent. I
19 don't know if there's specific examples in mind where it
20 got screwed up, but I think -- again, I think we're
21 averaging right now 50 to 60 days on minor source
22 permits.
23
MS. BASSI: Okay. And my other -- that was
24 all I had on that one, and my other question was on
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1 number 14, wherein the response -- we've talked about
2 this a little bit already today, but we didn't talk much
3 about bump-up. I just wondered, is there a likelihood of
4 a bump-up? There can be a bump-up in both ozone or the
5 PM classifications; is that correct?
6
MR. KALEEL: There certainly can be a
7 bump-up in the case of ozone. The ozone in the both
8 Chicago and Metro East areas are classified as moderate
9 and the Clean Air Act provides specific bump-up
10 provisions. I don't think there's a similar provision
11 for PM2.5. Within a non-attainment designation, USEPA
12 hasn't classified areas as moderate or serious or severe.
13
MS. BASSI: Okay. Never mind, then. That's
14 it.
15
HEARING OFFICER FOX: The Agency had
16 responded to a number of ExxonMobil's questions. Did any
17 of them generate any requests for clarification on the
18 part of any of the other participants? Mr. Elvert, you
19 were right. You were very quick, and of course we
20 appreciate that, and --
21
MR. ELVERT: You're welcome.
22
HEARING OFFICER FOX: -- Ms. Bassi, we're
23 back to you. We're at -- to the point in the proceedings
24 where we had agreed to turn to the responses to Midwest
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1 Generation's questions that were directed specifically to
2 Mr. Kaleel, and I think we had touched upon -- at least
3 touched upon a couple of those, but certainly as we
4 can -- as we proceed, we can see if some of those have
5 already been answered at least in part, but why don't we
6 begin, of course, with number 1 if you're ready to go.
7
MS. BASSI: No questions.
8
HEARING OFFICER FOX: No questions? Did
9 anyone else have any follow-up on the basis of the
10 Agency's response to question number 1? Seeing none,
11 Ms. Bassi, of course number 2.
12
MS. BASSI: No questions.
13
HEARING OFFICER FOX: None? Any other
14 participants with follow-up questions on number 2? That
15 brings us, of course, to number 3, Ms. Bassi.
16
MS. BASSI: No questions.
17
HEARING OFFICER FOX: On the part of any
18 other participants, number 3? Number 4, Ms. Bassi.
19
MS. BASSI: Number 4 is about averaging
20 plans, and we do have some questions about averaging
21 plans. Currently, as the rule is proposed, averaging
22 plans are allowed, but they are allowed only within a
23 source as opposed to within a system; is that correct?
24
MR. KALEEL: That's correct.
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1
MS. BASSI: And the rule provides that a
2 source or a unit can be included in only one averaging
3 plan. Does -- What does that mean? Does that mean that
4 a source that's subject to subpart D cannot be in -- or
5 subpart M is probably more like it -- cannot be in a
6 subpart V, as in Victor, averaging plan?
7
MR. KALEEL: I guess I'd like to distinguish
8 between your use of the word source and maybe the -- what
9 our intent is in terms of emission units.
10
MS. BASSI: Okay.
11
MR. KALEEL: Within a source, a company at
12 one location, they could have multiple averaging plans.
13 I think we envisioned that. But each individual emission
14 unit could only be included in one of those, one seasonal
15 and one annual.
16
MS. BASSI: So what I'm trying to get at,
17 though, is does participation of a unit in an averaging
18 plan under one of the subparts that's being created in
19 this rulemaking preclude its participation in an
20 averaging plan under another existing subpart, like
21 subpart V? I mean, yes, that's sources, but the units at
22 the sources or the CPS or -- which is essentially an
23 averaging plan that it goes outside the non-attainment
24 areas. Acid rain has averaging plans that are
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1 unit-specific.
2
MR. KALEEL: I think what we're talking
3 about in terms of averaging plans are in the concept of
4 this NOx RACT rulemaking.
5
MS. BASSI: Just within this?
6
MR. KALEEL: But within this rulemaking, a
7 boiler with a process heater, that would be allowed.
8
MS. BASSI: I think there's -- okay. There
9 is -- In Section 217.390(a)(1), which is not part of this
10 rulemaking, 217.390(a)(1) is the -- is part of the
11 Board's docket at R07-19, which is the rulemaking for
12 engines. Do you -- Did you participate in that
13 rulemaking?
14
MR. KALEEL: Yes, I did.
15
MS. BASSI: Do you recall the averaging
16 provisions in that rule?
17
MR. KALEEL: Somewhat, yes.
18
MS. BASSI: Is it the case that the
19 averaging provisions of that rule are system-wide within
20 the non-attainment area as opposed to source-wide within
21 the non-attainment area?
22
MR. KALEEL: The -- I think that is the
23 case. I think what was envisioned there was in the case
24 of a particular company who operates various compressor
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1 stations along a pipeline, and in some cases those
2 pipeline compressors would be located outside of the
3 non-attainment area, so that that was a concession, if
4 you will, on our part in the context of the compressor
5 stations given kind of the unique characteristics that
6 they have. Within a particular company, one operating
7 company, they might have various compressor stations
8 located in multiple counties along a pipeline.
9
MS. BASSI: I think you're confusing that
10 with the NOx SIP call one. There were two engine rules,
11 and I think the other one allowed that, but the second
12 one allowed only within the non-attainment area.
13
MR. KALEEL: Okay. I apologize. I prefaced
14 my remark that I only generally remembered the first --
15
MS. BASSI: Right. Is there a reason why
16 the Agency chose to limit the averaging plans in this
17 rule to just sources as opposed to systems within the
18 non-attainment area?
19
MR. KALEEL: I think in general it's
20 probably easier to conceive of an implementation of a
21 rulemaking as source-specific. I'm not aware of too many
22 circumstances beyond electric utilities, who already have
23 an averaging scheme under the multi-pollutant standard,
24 where that's even an issue.
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1
MS. BASSI: So no -- none of the other
2 sources or companies affected by this rule would have
3 multiple sites within a non-attainment area?
4
MR. KALEEL: I don't believe I said none,
5 but I think it would be pretty unusual. I think for the
6 most part they're individual operators.
7
MS. BASSI: Well, given our discussion
8 earlier about the exemption for sources that are subject
9 to the MPS or the CPS, the multi-pollutant standards, and
10 again assuming that the Board would adopt those -- but
11 who knows, maybe they wouldn't for some reason -- would
12 the Agency be open to considering a system-wide averaging
13 within the non-attainment area as opposed to just
14 limiting it to source-wide averaging?
15
MR. KALEEL: I guess we'd want to take a
16 look at the proposal. We're certainly open to discussing
17 any aspects of the rule, and if it makes sense to do
18 that, I think we're open to talk about it.
19
MS. BASSI: That's all I had on 4.
20
HEARING OFFICER FOX: And did any other
21 participant have a follow-up with regard to number 4?
22 Seeing none, Ms. Bassi, number 5, if you have a
23 follow-up.
24
MS. BASSI: Yes, I do. Oh, this is
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1 establishing that the annual emission reports serve as
2 the basis for determining the applicability of a unit as
3 an affected source, and in its response, the Agency used
4 the phrase "in general." This implies that there are
5 other means of determining whether a unit's emissions
6 exceed the thresholds of the rule, and I wondered if you
7 could give us some clues as to what those might be other
8 than annual emission reports.
9
MR. KALEEL: Well, I think the rule also
10 provides for a company to obtain a FESOP that would limit
11 their emissions to less than 15 tons, and that's
12 obviously the preferred way to do this, but to allow
13 maybe a little less paperwork, we intend to review the
14 annual emission reports. We have a review process to
15 receive annual emission reports and do some quality
16 assurance, and to the extent that we believe that
17 emissions are misreported, we might not solely rely on
18 those reported emissions. I think that's probably what
19 we had in mind there.
20
MS. BASSI: Okay. But you will -- will you
21 confirm, though, that the second tier of applicability --
22 in other words, the unit level of applicability of the
23 rule -- is based not on PTE or potential to emit, but it
24 is based on actual emissions?
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1
MR. KALEEL: Yes.
2
MS. BASSI: Okay. And if it's based on
3 actual emissions, is a FESOP -- which is a federally
4 enforceable state operating permit -- necessary at all?
5 I mean, you could have a source -- you could have a unit
6 that has a potential to emit a gazillion tons, but if it
7 emits only two, a FESOP isn't going to have any meaning.
8
MR. KALEEL: I don't think we require that
9 you get a FESOP to take advantage of this.
10
MS. BASSI: When would a new unit become
11 subject to the rule?
12
MR. KALEEL: I believe the first year
13 they're operating.
14
MS. BASSI: Would -- Okay. So if you have a
15 unit that's operating and it emits only 13 tons in --
16 annually, then it would not be subject to this rule; is
17 that correct?
18
MR. KALEEL: That's right.
19
MS. BASSI: Okay. That's it.
20
HEARING OFFICER FOX: Very well. Any other
21 follow-ups on question number 5? Seeing none, moving
22 on --
23
BOARD MEMBER JOHNSON: I'm seeing one.
24
HEARING OFFICER FOX: I'm sorry. I
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1 missed --
2
MS. HODGE: I have a quick follow-up.
3
HEARING OFFICER FOX: My apologies,
4 Ms. Hodge, to you.
5
MS. HODGE: And if you would -- this is in
6 follow-up to Miss Bassi's comments, and this has to do --
7 if we look in the Agency's notice of proposed amendment,
8 it shows the existing Section 217.121 for new fuel
9 combustion emission sources as being repealed here, and
10 so then we have just the new subpart B, which was the old
11 subpart C, existing fuel combustion emissions, so I'm not
12 sure, how does that interplay, you know, with the
13 existing new?
14
MR. KALEEL: Well, a new unit has other
15 requirements that they would be permitted under their new
16 source performance standards. There's other new source
17 review requirements, so, I mean, they would get picked
18 up, but --
19
MS. HODGE: Okay. But they would not be
20 subject to this rule, though, under the proposal right
21 here; is that --
22
MR. KALEEL: I think once they're operating,
23 they would be subject to this rule as well.
24
MS. HODGE: And where does it say that here
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1 in the proposed regulatory language?
2
MR. KALEEL: I think in a number of cases
3 we -- in our applicability we use words like "all" or
4 "any," and there are -- there's nothing in there that
5 distinguishes a specific date of construction with the
6 exception of the averaging plan provision. I don't see
7 anything in here that would exclude them.
8
MS. HODGE: Then what does the term
9 "existing" mean?
10
MS. BASSI: In -- You mean in 217.141?
11
MS. HODGE: Correct.
12
MR. RAO: Mr. Kaleel?
13
MR. KALEEL: Yes.
14
MR. RAO: While I was checking that, I just
15 wanted to point out that Section 217.154, performance
16 testing, there you have two subsections, ones that deal
17 with units constructed on or before December 1, 2009, and
18 for units constructed or modified after December 1, 2009.
19 Does that apply to new units, the subsection B, which
20 applies to units constructed or modified after 2009?
21
MR. KALEEL: This would include all units
22 constructed after 2009, including some that we don't even
23 know about, so that would include new units.
24
MR. RAO: But similar language is not
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1 proposed in the applicability section. Would it make the
2 rules clearer if you have some language which sets forth
3 that new units are subject to these rules?
4
MR. KALEEL: Perhaps -- I guess just given
5 the nature of the questions here, maybe it isn't clear,
6 so --
7
MS. BASSI: Let me follow up on this a bit.
8 Is Section 217-141 necessary anymore if this rule is
9 adopted?
10
MR. KALEEL: I think we'd want to respond to
11 that in writing. I --
12
MS. BASSI: Okay. Think about that?
13
MR. KALEEL: Yeah. I don't want to make a
14 blanket statement at this point.
15
MS. BASSI: And so then -- okay. Never
16 mind.
17
HEARING OFFICER FOX: Anything further,
18 Ms. Hodge, on that issue?
19
MS. HODGE: No. I'm done. Thank you.
20
HEARING OFFICER FOX: All done. For
21 Ms. Bassi?
22
MS. BASSI: Not on 5.
23
HEARING OFFICER FOX: Very well. Any other
24 participants with questions regarding number 5? I'm
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1 seeing none. On to number 6, Ms. Bassi.
2
MS. BASSI: Number 6, in what way does the
3 Agency not agree with the underlying premise of the
4 question? And this question -- just for the record, this
5 question goes to the applicability of subpart M being
6 based upon the efficacy of the CAIR, which is in doubt.
7
MR. KALEEL: Well, I think you hit upon the
8 issue there. There's a statement in there that CAIR has
9 been overturned, thus invalidating the Illinois CAIR
10 rule.
11
MS. BASSI: But qualified by the parens.
12
MR. KALEEL: Assuming there is a mandate,
13 I -- and I'd probably want to defer to the lawyers, but
14 my understanding is the Illinois CAIR rule is a state
15 rule that's been adopted by the Board, and unless there's
16 some subsequent action, it would still stand.
17
MS. BASSI: It would stand independent of
18 the federal CAIR?
19
MR. KALEEL: Again, I'd want to consult
20 lawyers, but it -- unless there was some other action
21 taken to invalidate the rule, and I think that's the
22 language that we had issue with.
23
MS. BASSI: Okay.
24
MR. KALEEL: Having said that, that really
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1 doesn't get to the point of the question, which we did
2 try to answer, so --
3
MS. BASSI: Well, no, that -- you've
4 answered the question that I had, my follow-up question,
5 and --
6
MR. KALEEL: Okay.
7
MS. BASSI: -- it raises other issues. If
8 the Illinois CAIR stands -- Assuming the total vacatur of
9 the federal CAIR, if the Illinois CAIR stands as an
10 independent rule, how would it be implemented when the
11 Illinois CAIR assumes the administration of USEPA of the
12 trading system?
13
MR. KALEEL: I think we appreciate the
14 problems when there isn't a national trading program. I
15 think, again, the -- I think the way we interpreted your
16 question is there's an automatic invalidation of the
17 state adopted rule, and I guess we don't see it as an
18 automatic invalidation. We know that USEPA is trying
19 very hard to reestablish CAIR, so right now this is kind
20 of hypothetical, but --
21
MS. BASSI: Thank you.
22
MR. KIM: Can I also add for the record that
23 I don't think this particular line of questioning in this
24 context is really where the Agency's going to make any
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1 official position as to what the current status is of the
2 Illinois CAIR rule, because I think that at this point,
3 until the dust settles, it's -- from a legal standpoint
4 we're not making any statement one way or the other, and
5 I think Mr. Kaleel's position, that that's not really
6 what the point of it was, and I -- in terms of our
7 concern, and then our answer, notwithstanding that,
8 should be sufficient for the purposes of this hearing.
9
MS. BASSI: I -- Thank you very much, and I
10 agree with that, but with the proposed changes in
11 language -- and I don't know where those come from, where
12 those are in here, but --
13
HEARING OFFICER FOX: I think that's your
14 question number 20.
15
MS. BASSI: In number 20, right. So --
16 okay. I'm done with 6.
17
HEARING OFFICER FOX: Very well. That --
18 And were there any other follow-up questions on number 6?
19 Ms. Bassi, that brings us to number 7. I think we had at
20 least touched upon that earlier, if not addressed it
21 fully.
22
MS. BASSI: Number 7?
23
HEARING OFFICER FOX: Number 7, yes.
24
MS. BASSI: Yes, we're done with that.
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1
HEARING OFFICER FOX: Very well. Anyone
2 else who wish -- requests any follow-up on number 7?
3 Seeing none, that of course brings us to number 8. Ms.
4 Bassi?
5
MS. BASSI: No questions.
6
HEARING OFFICER FOX: Any follow-ups with
7 regard to the load shaving unit issue with number 8?
8 Seeing none, that brings us to number 9, Ms. Bassi.
9
MS. BASSI: No questions.
10
HEARING OFFICER FOX: Any other follow-up or
11 clarification sought from the Agency here? None. Number
12 10?
13
MS. BASSI: No questions, I don't think. No
14 questions.
15
HEARING OFFICER FOX: On number 10?
16
BOARD MEMBER JOHNSON: Auctioneer.
17
MS. HODGE: Yeah.
18
MS. BASSI: Going --
19
HEARING OFFICER FOX: Any other participants
20 with follow-up questions on the Agency's answer to number
21 10? Seeing none, there's that one-word answer to your
22 question, Ms. Bassi, in number 11.
23
MS. BASSI: Yeah, and I have a bigger
24 question than the one word.
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1
HEARING OFFICER FOX: Please go ahead.
2
MS. BASSI: Does the Agency's answer to that
3 with respect to the Metro East non-attainment area, where
4 you do not have coterminous non-attainment areas for
5 ozone and PM2.5, amount to an expanded applicability of
6 this rule? It's expanding the applicability of the
7 entire rule beyond the non -- the respective
8 non-attainment areas for ozone and PM2.5?
9
MR. KALEEL: I guess I don't see how it's
10 expanding the applicability.
11
MS. BASSI: Well, is Baldwin Township in
12 Randolph County non-attainment for ozone?
13
MR. KALEEL: No, it's not, but it is for
14 PM2.5.
15
MS. BASSI: Do the ozone -- the seasonal
16 requirements of this rule apply in Randolph Township, or
17 Randolph -- or Baldwin Township in Randolph County?
18
MR. KALEEL: The way the rule is written, it
19 does, yes.
20
MS. BASSI: Okay. And likewise, is Jersey
21 County non-attainment for PM2.5?
22
MR. KALEEL: No, it's not.
23
MS. BASSI: And do the annual requirements
24 of this rule apply in Jersey County?
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1
MR. KALEEL: Yes.
2
MS. BASSI: So is that not an expansion
3 beyond the respective non-attainment areas of the rule?
4
MR. KALEEL: The way the rule is written,
5 those counties would have to comply with both, so I --
6
MS. BASSI: So you have --
7
MR. KALEEL: I don't know that it's an
8 expansion. Those boundaries have been established for
9 three or four years now.
10
MS. BASSI: But you have an area that is
11 attainment for ozone having to comply with the seasonal
12 limit; is that correct?
13
MR. KALEEL: I understand, yes.
14
MS. BASSI: Okay. That's it.
15
MR. KALEEL: I also don't believe there are
16 any sources to which the rule applies in Jersey County.
17
MS. BASSI: No cows, huh?
18
HEARING OFFICER FOX: Ms. Bassi, you said
19 that was it with regard to number 11?
20
MS. BASSI: That's it with number 11.
21
HEARING OFFICER FOX: Very good. Any other
22 questions following up on number 11? That brings us to
23 number 12, of course, Ms. Bassi.
24
MS. BASSI: No questions.
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1
HEARING OFFICER FOX: No questions there.
2 On the part of anyone else? To number 13, Ms. Bassi.
3
MS. BASSI: I do have a follow-up in number
4 13. This question goes to the fact that there is a
5 statement in the Section -- Section 217.152(b) is I
6 believe establishing the compliance date; is that
7 correct? I think it's establishing the compliance date,
8 and there's a statement in there that the owner/operator
9 of an emission unit that is subject to these subparts
10 must operate the unit consistent with good air
11 pollution -- is this a substantive requirement? This
12 statement, is that statement a substantive requirement
13 that is enforceable?
14
MR. KALEEL: I'm not sure what the context
15 of an enforcement action would constitute. I think we're
16 just asking for good operating practices to be used in
17 the operation of the units.
18
MS. BASSI: So then basically, you do not
19 anticipate that an inspector could go to a source, look
20 at this unit, say, you're not using good operating
21 practices, and then have this moved through the system to
22 be an enforcement case on the basis of this language.
23
MR. KALEEL: It'd be hard to conceive of a
24 situation like that, but I guess I couldn't rule it out.
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1
MS. BASSI: Oh, you could not rule it out?
2
MR. KALEEL: I don't think I would rule it
3 out.
4
MS. BASSI: Okay.
5
MS. ROCCAFORTE: Can I ask a follow-up
6 question on that?
7
HEARING OFFICER FOX: Please go ahead,
8 Ms. Roccaforte.
9
MS. ROCCAFORTE: Just to clarify?
10 Mr. Kaleel, to your best knowledge, do you know if
11 statements like this are incorporated in Title V permits?
12
MR. KALEEL: My understanding is there
13 are -- is language like that in many Title V permits.
14
MS. ROCCAFORTE: Thank you.
15
HEARING OFFICER FOX: Thank you,
16 Ms. Roccaforte. Any follow-ups, Ms. Bassi?
17
MS. BASSI: No.
18
HEARING OFFICER FOX: Very well. With
19 regard --
20
MR. RAO: May I?
21
HEARING OFFICER FOX: Yes, go ahead.
22
MR. RAO: Mr. Kaleel, with this --
23
MR. KALEEL: I'm sorry.
24
MR. RAO: Getting back to the same
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1 provision, that language, could you just explain why you
2 put that provision in the compliance dates? Would it be
3 more appropriate to move that provision under
4 applicability sections of different subparts?
5
MR. KALEEL: It might be appropriate in
6 another location, yes.
7
MR. RAO: Okay.
8
MR. KALEEL: It doesn't have a direct
9 relation to compliance dates.
10
MR. RAO: Thank you.
11
HEARING OFFICER FOX: Any further questions
12 with regard to the Agency's response to number 13?
13 Seeing none, that brings us to 14, regarding
14 record-keeping, Ms. Bassi.
15
MS. BASSI: Nope.
16
HEARING OFFICER FOX: No questions? Any
17 other questions on that issue or the response to number
18 14? Seeing none, to number 15, Ms. Bassi.
19
MS. BASSI: No further questions.
20
HEARING OFFICER FOX: On the part of any of
21 the other participants? I'm seeing no indication of a
22 question. That takes us to question 16, of course,
23 regarding Section 217.156(k), Ms. Bassi.
24
MS. BASSI: No questions.
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1
HEARING OFFICER FOX: Any other interest in
2 following up with those issues? Seeing none, again, a
3 one-word response to your question, Ms. Bassi. Any
4 follow-up?
5
MS. BASSI: No follow-up.
6
HEARING OFFICER FOX: No follow-up to that?
7 Any other clarifications sought by any of the other
8 participants? None apparently. Number 18, Ms. Bassi.
9
MS. BASSI: No questions.
10
HEARING OFFICER FOX: Did anyone else wish
11 to pose a follow-up? None? Ms. Bassi, I think we had
12 talked about number 19 already.
13
MS. BASSI: That's correct.
14
HEARING OFFICER FOX: Satisfactorily
15 answered for you?
16
MS. BASSI: Yes.
17
HEARING OFFICER FOX: Very good. Any other
18 follow-up questions on that one? That takes us, of
19 course, to number 20. I'm betting that you do have some
20 follow-ups on that proposed alternative language.
21
MS. BASSI: Actually, very short.
22
HEARING OFFICER FOX: Very good. Please go
23 ahead.
24
MS. BASSI: I -- Question 20 presents a
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1 proposal for amending language that we viewed as better
2 effectuating the perceived intent of the rule, and we
3 discussed this with the Agency and they provided a
4 response, and the follow-up here is that the Agency's
5 language is acceptable to Midwest Generation and Midwest
6 Generation will so state in either testimony or comments.
7
HEARING OFFICER FOX: Very good. That's
8 certainly on the record on the basis of your testimony
9 here, Ms. Bassi, and --
10
MS. BASSI: I can't testify.
11
HEARING OFFICER FOX: You cannot. That's
12 correct. Thank you for reminding me of that.
13
MS. BASSI: I've been reminded several
14 times.
15
HEARING OFFICER FOX: And once again today,
16 apparently, but if that's suitable for a post-hearing
17 comment or for prefiled testimony for the second hearing,
18 those certainly would be two avenues very suitable for
19 making that position known. But did you have any further
20 follow-up questions or anything further to say?
21
MS. BASSI: No.
22
HEARING OFFICER FOX: Did any of the other
23 participants with regard to that proposed alternative
24 language? I'm seeing no interest in follow-ups, so that
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1 brings us to question number 21, Ms. Bassi.
2
MS. BASSI: And we have already addressed
3 question 21.
4
HEARING OFFICER FOX: We did in fact.
5 You're right. Thank you for reminding me. Anyone else
6 have follow-ups of their own that they wish to pose?
7 Very well. Number 22, Ms. Bassi, regarding the --
8
MS. BASSI: No, I have no questions, and no
9 questions on 23.
10
HEARING OFFICER FOX: On either 22 or 23,
11 does anyone seek any clarification or follow-up? Seeing
12 none whatsoever, that brings us to the end of the
13 questions that Midwest Generation had posed for
14 Mr. Kaleel, and I'm to the end of all of the questions
15 prefiled -- I'm sorry -- responses filed by the Agency to
16 the questions that were prefiled by the three entities
17 who have been here today. I recall, checking the sign-in
18 sheet that was placed at the door seeking the names of
19 anyone who wished to testify, Mr. Gupta, I think you had
20 placed your name on that, but of course you have been
21 sworn in and testifying on behalf of the Agency, so we
22 have run through all of the prefiled testimony that the
23 Agency had filed and have no one else indicating in
24 writing that they had wished to provide any testimony.
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1 Is there anyone -- there are only a few of you left --
2 who did wish to provide any sworn testimony at this
3 hearing? I'm seeing no indication that that is the case,
4 and that would bring us to the point at which we can
5 discuss some procedural issues regarding the second
6 hearing, and it would be best probably to go off the
7 record briefly to talk about those.
8
MS. ROCCAFORTE: Mr. Fox?
9
HEARING OFFICER FOX: Yes.
10
MS. ROCCAFORTE: I have attachment 8 to the
11 TSD.
12
HEARING OFFICER FOX: Thank you for jogging
13 my memory, but if you wouldn't mind distributing it, once
14 we're back on the record, I could easily just entertain a
15 specific motion. I apologize that I overlooked that
16 after asking, but I appreciate you recalling that.
17
(Discussion held off the record.)
18
HEARING OFFICER FOX: The participants went
19 off the record for a moment or two to address some
20 procedural issues relating to filing of various documents
21 that were both referred to in the course of the hearing
22 today and the prefiling of documents -- various documents
23 for the second hearing that is now on the calendar to
24 take place on Tuesday, December 9.
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1
There are specific spreadsheets that were the
2 subject of a number of questions in the course of the
3 hearing today, and the Agency has committed to make those
4 available to the Board by Tuesday, October 21, 2008, so
5 that the Board through its clerk's office may make
6 available an Excel version of those spreadsheets to the
7 participants who had sought that version of those
8 documents.
9
The -- There were other questions raised in the
10 course of hearing for which the Agency would like to wait
11 for the availability of the transcript to assure that
12 they are responding to the specific questions that were
13 raised. Because we expect the transcript by Friday,
14 October 24, the Agency has committed to file a written
15 response to those specific questions reflected in the
16 transcript of this hearing by Wednesday, November 5,
17 2008, and the participants who wish to prefile testimony
18 for the second hearing, that as I mentioned is now
19 scheduled to take place on December 9, will have a
20 deadline of Tuesday, November 25, 2008. Because that's
21 two weeks before the hearing and there is an intervening
22 holiday weekend, a lengthy one, I would ask -- although I
23 did not address this in going off the record -- that the
24 mailbox rule not apply so that it's available with a full
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1 two weeks for the Agency to review and prepare its
2 questions and there won't be any delay with the mail
3 delivery. Ms. Bassi?
4
MS. BASSI: I have a question about that.
5 Is -- Electronic delivery to the Agency, does that
6 satisfy the mailbox rule?
7
HEARING OFFICER FOX: The Board does need to
8 receive it so it can be made part of its record and
9 posted to COOL, but as a practical matter, electric
10 delivery to the Agency and to the Board could happen
11 simultaneously, I think, with the typing of just one more
12 e-mail address, Ms. Bassi, if that's helpful.
13
MS. BASSI: And that's acceptable to the
14 Agency?
15
MS. ROCCAFORTE: Yes.
16
MS. BASSI: Thank you.
17
HEARING OFFICER FOX: Any further questions?
18 Very good. Any questions about the dates that I had just
19 recited tediously? Any other procedural issues at all
20 that people wanted to raise? Let me read my canned
21 remarks that of course anyone may file written public
22 comments in this rulemaking with the clerk of the board.
23 Those may be made electronically through the clerk's
24 office online, with which I think you are all quite
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1 familiar, but our clerk's office has generally proven to
2 be very helpful in walking people through that procedure.
3 Those filings with the Board, whether paper or
4 electronic, do need to be served on the Hearing Officer
5 and the persons on the service list, and I would strongly
6 recommend that you consult with the clerk to determine
7 that your own service list is the most current one.
8
As I mentioned, copies of today's transcript, the
9 transcript of today's hearing, should be available to the
10 Board by Friday, October 24, and very soon after that the
11 transcript should be posted at the Board's Web site, from
12 which of course it can be read, copied and downloaded.
13
The second hearing will proceed as scheduled on
14 Tuesday, December 9, beginning at 11 a.m. in Chicago with
15 that November 25 deadline for prefiling testimony. My
16 e-mail address and direct telephone number are posted on
17 the Board's Web site so that you may always reach me with
18 any procedural questions at least. Any further
19 questions, then, before we adjourn?
20
MS. ROCCAFORTE: Attachment 8.
21
HEARING OFFICER FOX: You've had to remind
22 me twice and I'm very embarrassed. We can take a moment
23 to distribute those and entertain a quick motion.
24
MS. ROCCAFORTE: I'd like to move that
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1 attachment 8 to the technical support document be
2 admitted as an exhibit.
3
HEARING OFFICER FOX: And this of course was
4 filed with part of the Agency's original filing back in
5 May, if I'm not mistaken.
6
MS. ROCCAFORTE: Correct.
7
HEARING OFFICER FOX: Very good. I'll rush
8 ahead since I suspect that there would not be any
9 objection to the admission, marking that as Exhibit No. 4
10 and admitting that into the record of this proceeding,
11 and having neither seen nor heard any objection to
12 marking or admitting that, it is marked and admitted into
13 the record as Exhibit No. 4 in this proceeding. And
14 thank you again for reminding me. It was the end of a
15 long day, I'm afraid, and I'm just forgetful.
16
If there is no other business to take place
17 today, I want to thank certainly the Agency for
18 submitting its written answers to the questions. I think
19 that certainly helped things move expeditiously today. I
20 thank all of the other participants as well for their
21 questions and their participation, and with that, I'm
22 sure I speak for the board members and board staff in
23 again expressing our thanks, and we're adjourned.
24
(Hearing adjourned at 4:28 p.m.)
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1 STATE OF ILLINOIS )
) SS
2 COUNTY OF BOND
)
3
4
I, KAREN WAUGH, a Notary Public and Certified
5 Shorthand Reporter in and for the County of Bond, State
6 of Illinois, DO HEREBY CERTIFY that I was present at
7 Illinois Pollution Control Board, Springfield, Illinois,
8 on October 14, 2008, and did record the aforesaid
9 Hearing; that same was taken down in shorthand by me and
10 afterwards transcribed, and that the above and foregoing
11 is a true and correct transcript of said Hearing.
12
IN WITNESS WHEREOF I have hereunto set my hand
13 and affixed my Notarial Seal this 24th day of October,
14 2008.
15
16
17
__________________________
18
Notary Public--CSR
19
#084-003688
20
21
22
23
24
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