ILLINOIS POLLUTION CONTROL BOARD
    December 13,1973
    MT. CARMEL PUBLIC UTILITY,
    Petitioner,
    vs.
    )
    PCB 73—300
    ENVIRONMENTAL PROTECTION AGENCY,
    Respondent.
    ORDER OF THE BOARD (by Mr. Seaman):
    On November 5, 1973, Petitioner, Mt. Carmel Public
    Utility Company, filed its Petition seeking amendment
    of our Opinion and Order of October 18, 1973 (PCB 73-300).
    ThereiD, we granted Petitioner’s request for Variance
    from Rule 3-3.112 of the Rules and Regulations Governing
    the Control of Air Pollution for two if its boilers stating,
    “The Board is satisfied that Petitioner has applied itself
    with good faith and diligence to the compliance program
    ordered on November 11, 1971... .The alternative plan
    submitted by Petitioner and contained in the body of this
    Opinion is hereby approved.”
    The alternative plan approved is as follows:
    a) Conversion of Boiler No. 1 to gas and oil
    to be completed by May 1, 1974, with the
    boiler going out of service January 1, 1974;
    b) Boiler No. 4, Petitioner’s last coal-fired
    boiler, will be retired on or before June 30,
    1974, in compliance with the Board’s original
    Order.
    Petitioner now requests that the Board modify its Order
    of October 18, 1973, to defer conversion of Boiler No. 1
    and retirement of Boiler No. 4 until October 31, 1974.
    Petitioner contends that its ability to assure reliability
    of service to its customers appears to be seriously
    jeopardized by the developing situation regarding fuel
    oil shortages if Petitioner is required to comply with
    the existing Order of the Board.
    As stated in paragraph 7 of Petitioner’s Supplemental
    Petition for a Continuance of Variance filed with the Board
    on July 25, 1973, Petitioner entered into a contract with
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    325

    —2--
    Marathon Oil Company on October 10, 1972, for the purchase
    of No. 2 fuel oil to be delivered from its Robinson, Illinois,
    refinery. Marathon agreed to deliver six million gallons
    during the first year of the contract, plus or minus 10,
    with the quantity, quality and price subject to renego-
    tiation at the end of each year of the contract. Petitioner
    has been receiving deliveries from Marathon under this
    contract since the conversion of boiler No. 5 was completed
    in
    March of 1973.
    On
    October
    12,
    1973,
    the
    Energy Policy Office of the
    Department of interior issued its EPO Reg. 1-Mandatory
    Allocation Program for Middle Distillate Fuels (see
    Federal Register, Volume 38, No. 199-Tuesday, October 16, 1973).
    Number 2 fuel oil being purchased by Petitioner from
    Marathon Oil Company is covered by this mandatory fuel
    allocation program. The regulation provides that each
    wholesale purchaser of such fuel oil (which includes
    utilities) will be entitled to receive allocations under
    the
    program from its suppliers on the basis of purchases
    during the corresponding month of 1972. Mandatory allocation
    of fuel oils under this order began November 1, 1973,
    Insofar as Petitioner made
    no
    purchases of fuel oil in
    1972, it has no basis -for the allocation of oil from any
    supplier beginning November 1, 1973. However, paragraph
    4 (d) provides:
    “Any
    wholesale purchaser who did not have a supplier
    during 1972 may
    apply to
    the Department of
    the
    Interior and be
    assigned a supplier.
    Any
    customer
    so
    assigned must be accepted by the supplier for
    the
    duration
    of
    the program. The Department
    of
    the Interior will develop and
    publish
    a set of
    criteria under which such applications will be
    considered.
    The
    criteria will include consideration
    of
    unusual conditions or misfortunes in the base
    period, new investments, sales experience of comparable
    purchasers, etc.”
    Paragraph 4
    (f) of
    the Regulation provides in part that
    if a supplier has insufficient supplies to provide each
    of
    the
    wholesale purchasers which he supplied in :L972 (including
    those purchasers assigned by the Department of the Interior)
    with
    a quantity equal
    to the
    1972 base
    or adjusted base
    period supply level, the supplier will allocate based on
    proportional allocations. This portion of the regulation
    contemplates that suppliers may be unable to meet their
    obligations to supply wholesale purchasers which
    they
    supplied
    in
    1972 and those purchasers assigned to the supplier
    by
    the
    Department of
    the Interior.

    —3—
    Petitioner has received a letter from Marathon
    Oil Company, dated October 16, 1973, from its Findlay,
    Ohio, offices (Exhibit “A”) informing the Petitioner
    of the mandatory allocation program and stating that
    the program would impair the ability of Marathon to
    supply the Petitioner with its fuel oil requirements under
    the contract previously mentioned.
    After seeking information from the Department of
    the Interior at Chicago, Illinois, the Petitioner, on
    October 22, 1973, wrote a letter to the Department of
    the Interior, in the absence of a prescribed form, re-
    questing an allocation of oil under paragraph 4 (‘d) of
    the Mandatory Allocation Regulation and the assignment
    of a supplier (Exhibit “B”). Since that time the
    Department of
    the Interior has supplied Petitioner with
    forms, and an allocation of oil and an assignment of a
    supplier has been requested on the prescribed form (Exhibit
    C”
    In view of the world-wide shortage of crude oil and
    refining capacity, as well as the uncertainties of obtaining
    the necessary allocations and suppliers from the Department
    of the Interior, Petitioner does not consider it advisable
    to proceed with the conversion of its Boiler No.
    1 on
    January 1, 1974. Also, under the circumstances, Petitioner
    does not consider it prudent to take Boiler No. 4 out of
    service on June 30, 1974. Petitioner’s ability to assure
    reliability of service to its customers appears to be
    seriously jeopardized by the developing situation regarding
    fuel oil if Petitioner complies with the existing orders of
    the Board. If Boiler
    No.
    1 is converted to oil as originally
    proposed, and Boiler No. 4 is taken out of service on
    June 30, 1974, and thereafter Petitioner should be unable
    to secure a sufficient allocation of fuel oil, or if it were
    unable to secure any allocation, Petitioner might become
    largely or entirely dependent upon energy purchased from
    Central Illinois Public Service Company through its presently
    existing single-pole 69 KV transmission line intertie with
    CIPS at Lawrenceville, Illinois. If Petitioner became entirely
    dependent upon purchased energy, this 69 KV transmission
    line would be wholly inadequate to supply the needs of
    customers within Petitioner’s service area. Also, Petitioner
    contends that if it had only limited generating capacity
    because of inability to obtain fuel oil, and if Boiler No. 4
    were out of service, and if this transmission line were also
    taken out of service by windstorms, ice storms, lightning
    strikes or other calamities such as automobile collisions with
    poles, Petitioner
    would
    be either wholly unable to supply its
    10
    327

    —4—
    service
    area
    with
    electric power or would be
    able
    to supply
    only
    a
    limited amount of electric power,
    depending upon the amount of fuel oil
    available
    to it
    for generation of power, and this situation
    might exist for an extended period of time. Petitioner
    argues that it is in the same dilemma if it does not
    convert Boiler No. 1 to fuel oil, but takes Boilers
    No. 1 and 4 out of service on June 30, 1974, leaving only
    Boiler No. 5 available for power generation, in order
    to bring itself into compliance with the previous Order
    of the Board.
    An additional possible complication is the fact
    that Petitioner supplies steam to the Mt. Carmel plant
    of the Flintkote Company which produces felt paper used
    in
    the manufacturing
    of roofing materials and which employs
    approximately 85 men. If Petitioner cannot lawfully burn
    coal in any of its boilers after June 30, 1974, and if the
    supply of fuel oil available to Petitioner is greatly
    restricted, or unavailable, then Petitioner might be unable
    to fulfill its contractual obligations with the Flintkote
    Company to supply steam to its Mt. Carmel plant, as a
    consequence of which the Flintkote plant would be required
    to curtail or cease operations, with serious adverse effect
    upon the economy of
    the City of Mt.
    Carmel and surrounding
    areas.
    As we stated in our Opinion and Order of October 18, 1973,
    this Board is satisfied that Petitioner has applied
    itself with good faith and diliqence to the compliance
    program ordered. Petitioner’s present plight is the result
    of factors beyond its power to influence. We will, therefore,
    grant the requested modification of our opinion and Order
    of October 18, 1973 (PCB 73-300) subject to certain conditions.
    Petitioner is currently attempting to construct a
    138 KV line (to be operated initially at 69 Ky) from the
    Village of Keensburg, Illinois, to an intertie with Central
    Illinois Public Service Company.at Albion, Illinois.
    Petitioner has encountered numerous difficulties in obtaining
    right—of-way easements for this line, and it is now certain
    that construction cannot be completed by June 30, 1973,
    as originally ordered by the Board. The Agency is of the
    opinion that Petitioner has shown good faith in developing
    the 138 KV line and that the problems encountered in said
    development are not self-imposed.
    10
    328

    —5—
    IT IS THE ORDER of the Pollution Control Board that
    the motion of Mt. Carmel Public Utility Company to
    extend the compliance date (June 30, 1974) stated in
    our Opinion and Order of October 18, 1973 (PCB 73-300)
    to October 31, 1974, be granted subject to the following
    conditions:
    1. Petitioner shall pursue, with all diligence
    and dispatch, the acquisition of right-of-way easements
    for its 138 KV line and the acquisition of sufficient
    fuel oil commitments to allow conversion of its Boiler
    No. 1 at the earliest possible date.
    2. Petitioner shall file with the Agency quarterly
    reports regarding its progress toward achieving the
    objectives specified in Condition 1, above.
    IT IS SO ORDERED.
    I, Christan L. Moffett, Clerk of the Illinois Pollution
    Control Board, certify hat the above Order was adopted
    on this
    (.~“
    day of
    _____________
    1973 by a vote of
    ________
    to
    p
    10—329

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