In The Matter of:
Proposed New 35111. Adm. Code 225
Control of Emissions from
Large Combustion Sources
ILLINOIS POLLUTION CONTROL BOARD
No. R06-25
(Rulemaking -
Air)
NOTICE OF FILING
TO: See attached Service List
PLEASE TAKE NOTICE that on July
28, 2006, I
filed with the Office of the Clerk of the
Pollution Control Board, Participant KINCAID GENERATION, L
.L.C.'s
PREPARED
TESTIMONY OF C.J
. SALADINO and PREPARED TESTIMONY OF ANDY YAROS, copies
of which are herewith served upon you .
By:
Bill S . Forcade
JENNER & BLOCK LLP
Attorneys for Kincaid Generation, LLC
One IBM Plaza
Chicago, IL 60611
(312) 222-9350
RECEIVED
CLERK'S
JUL 2 8 2006
Pollution Control
8oa
d
THIS FILING IS SUBMITED ON RECYCLED PAPER
Gina Roccaforte, Assistant Counsel
Charles Matoesian, Assistant Counsel
John J. Kim, Managing Attorney
Air Regulatory Unit
Division of Legal Counsel
Illinois Environmental Protection Agency
1021 North Grand Avenue East
P .O. Box 19276
Springfield, IL 62794-9276
Dorothy Gunn, Clerk
Illinois Pollution Control Board
James R. Thompson Center
100 W. Randolph St.,
Suite 11-500
Chicago, IL 60601-3218
Bruce Nilles
Sierra Club
122 W. Washington Ave ., Suite 830
Madison, WI 53703
Matthew Dunn, Chief
Division of Environmental Enforcement
Office of the Attorney General
188 West Randolph St ., 20th Floor
Chicago, IL 60601
William A. Murray
Special Assistant Corporation Counsel
Office of Public Utilities
800 East Monroe
Springfield, Illinois 62757
Christopher W
. Newcomb
Karaganis, White & Mage., Ltd.
414 North Orleans Street, Suite 810
Chicago, Illinois 60610
David Rieser
James T. Harrington
Jeremy R . Hojnicki
McGuire Woods LLP
77 West Wacker, Suite 4100
Chicago, Illinois 60601
SERVICE LIST
Faith E. Bugel
Howard A . Learner
Meleah Geertsma
Environmental Law and Policy Center
35 East Wacker Drive, Suite 1300
Chicago, Illinois 60601
James W . Ingram
Dynegy Midwest Generation, Inc .
1000 Louisiana, Suite 5800
Houston, TX 77002
N
. LaDonna Driver
Katherine D . Hodge
Hodge Dwyer Zeman
3150 Roland Avenue, P.O
. Box 5776
Springfield, Illinois 62705-5776
Keith I . Harley
Chicago Legal Clinic
205 West Monroe Street, 4th Floor
Chicago, Illinois 60606
S
. David Farris
Manager, Environmental, Health and Safety
Office of Public Utilities, City of Springfield
201 East Lake Shore Drive
Springfield, Illinois 62757
Marie Tipsord
Hearing Officer
Illinois Pollution Control Board
James R. Thompson Center
100 W. Randolph, Suite 11-500
Chicago, Illinois 60601
Kathleen C . Bassi
Sheldon A. Zabel
Stephen J . Bonebrake
Joshua R . More
Glenna L. Gilbert
SCHIFF HARDIN LLP
6600 Sears Tower
233 South Wacker Drive
Chicago, Illinois 60606
Dianna Tickner
Prairie State Generating Company, LLC
701 Market Street, Suite 781
St
. Louis, MO 63101
CHICAGO- ] 402614 1
SERVICE LIST cont .d
CERTIFICATE OF SERVICE
I, Bill S . Forcade, an attorney, hereby certify that I served a copy of the foregoing
KINCAID GENERATION, L.L.C.'s
PREPARED TESTIMONY OF C .J. SALADINO and
PREPARED TESTIMONY OF ANDY YAROS, via first-class mail, postage fully prepaid, upon
the parties on the attached Service List this 28th day of July, 2006 :
B
BEFORE THE ILLINOIS POLLUTION CONTROL BOARDRECEIVEDCLERK'S OFFICE
JUL 2 8 2006
In The Matter of
:
)
STATE OF ILLINOIS
Pollution Control Board
Proposed New 35 Ill . Adm. Code Part 225 )
R06-25
Control of Emissions from
)
(Rulemaking - Air)
Large Combustion Sources
)
KINCAID GENERATION LLC'S PREPARED TESTIMONY OF C .J. SALADINO
1 . INTRODUCTION
My name is C .J
. Saladino, and I am the Station Director of the Kincaid Generation L .L.C. power
plant in Kincaid, Illinois in Christian County . I have been an employee at Kincaid for 24 years
and a life-long resident of Springfield, Illinois . During my career, I have held various positions at
the Kincaid facility, including technical staff engineer, water department supervisor, operations
supervisor, operations manager and now Director . I am a 1982 graduate of the University of
Illinois with a bachelor's degree in mechanical engineering . In 2005, I also completed the
Advanced Management Program at Duke University.
2. FACILITY BACKGROUND
The Kincaid facility comprises two 625-megawatt coal-fired boilers . These units have burned
Powder River Basin (PRB) sub-bituminous coal since 1999, when the facility switched to the
lower sulfur western coal in order to meet the federal Acid Rain program sulfur dioxide
emissions limitations
. Although the PRB coal has a much lower sulfur and ash content, it also
has a lower heating value and higher moisture levels . Its relatively low density and high water
content makes this coal susceptible to spontaneous combustion if not packed densely during
storage in order to limit free air flow . As a result, the Station has implemented coal handling
techniques that include a concerted effort to minimize coal dust through careful housekeeping .
Kincaid's conversion to and handling of this lower emissions sub-bituminous coal has been so
successful that the Kincaid plant twice has been chosen by the national Powder River Basin Coal
Users group as the Coal Plant of the Year, in 2001 and 2004. Kincaid Station was selected from
among hundreds of plants that burn low sulfur PRB coal . Kincaid was honored for going to
"extraordinary lengths to keep a clean, safe environment" in order to minimize dust from
accumulating to explosive levels . Power stations nominated for the award are judged on safety,
housekeeping and use of best practices . Other criteria for the award are availability, heat rate, the
amount of electricity generated, and the amount of coal burned .
In 2001, Kincaid began construction of two SCRs, or selective catalytic reduction facilities .
These massive controls, which together cost more than $85 million, began operation in 2002 and
have been very effective, removing up to 90% of the nitrogen oxide (NOx) emissions from the
flue gas
. Kincaid currently spends over $1,000,000 annually on anhydrous ammonia for the
SCR's, which are operational only during the 5 ozone season months . . When we commence year
round use of them the annual ammonia costs will be in the $2 .5 - $3 .0 million range.
3.
KINCAID'S ENVIRONMENTAL ACCOMPLISHMENTS
The result of all these activities is much lower emissions both from the stack and from the
material handling operations at Kincaid. Accordingly, Kincaid has compiled an exemplary
environmental compliance record. Since Dominion purchased the plant in 1998, the plant has
received no environmental violations, cut sulfur dioxide and nitrogen oxide emissions drastically
2
from pre-1998 levels, and taken steps to minimize opacity and particulate levels . Kincaid
Station was nominated by the IEPA in 2004 as one of four finalists out of over 1100 facilities for
Best Operated Wastewater Treatment Plant .
4. KINCAID'S COMMUNITY ACCOMPLISHMENTS
The Kincaid Power Station supports the community in which our employees live . Nearly all the
147 Kincaid employees live in Christian or Sangamon Counties . The Station supports many
charitable activities in the area, including the Shadow House Women's Shelter, Central Illinois
Foodbank, Friend-In-Deed Program, and Mary Bryant Home for the Blind . We at Kincaid are
extremely proud of our Station and its excellent operations- an achievement we accomplished
while generating more power, more efficiently, more safely and, at the same time, with
substantially lower emissions than ever before in the plant's history.
5
. KINCAID'S CONCERNS WITH IEPA PROPOSAL
I am here today to register our concern with the Illinois EPA's (IEPA) proposed mercury
rulemaking . We believe that 90% mercury reduction is an achievable goal, although not always
cost effectively, but such reductions cannot be accomplished in the short time frame before July
1, 2009, contemplated by the IEPA proposed rule . The IEPA's primary testimony was that
activated carbon injection (ACI) or halogenated activated carbon injection (HACI) would be able
to achieve the required reductions under the proposed rule . As testified by several witnesses
see prepared testimony of Mr
. DePriest, and J. E
. Cichanowicz ), and articulated by both the
United States Environmental Protection Agency (USEPA) and the United States Department of
Energy (USDOE), the ACI or HACI processes have not been sufficiently demonstrated to be
considered "commercially available" i or to be relied upon to achieve regulatory requirements
with the stringent 90% control requirements at this time . Kincaid cannot presume that it will
achieve compliance for several reasons, as discussed by others (see prepared testimony of Mr .
DePriest, and J . E. Cichanowicz ), including but not limited to :
Coal Mercury Content Variability
Mercury Analytical Testing Errors
Strong Indications that Mercury Removal is dependant upon ESP size and other factors
Until these technologies have been more fully explored, Kincaid cannot reasonably assume that
ACI or HACI will achieve the required reductions .
The only other potential control technology, the TOXECON system would require Kincaid to
install fabric filters at an estimated cost of $130 Million
. The TOXECON costs are
unreasonable .
6
. THE IEPA PROPOSAL UNIQUELY DISADVANTAGES KINCAID
We believe the proposal unjustifiably disadvantages our Kincaid plant, especially in comparison
to other plants in Illinois . We believe the proposal threatens the continued economic well-being
of the Kincaid plant and, as a result, could, under certain scenarios, lead to the shut down of the
Kincaid station . We especially take note of IEPA's testimony (June 12 testimony of Mr
. Jim
Ross, page 18) of June 12 . The agency's witness said IEPA would never "impose unreasonable
standards that will create undue hardships on the power sector," but IEPA is proposing the most
' See Feeley, T ., "Clarification
of
the U .S . Department of Energy's Perspective on the Status of
Mercury Control
Technologies For Coal-Fired Power Plants", April, 2006 stating that " . .
.there remain a number of critical technical
and cost issues that need to be resolved through additional research before these technologies can be considered
commercially available for all U .S
. coals and the different coal-fired power plant configurations in operation in the
United States" .
4
stringent mercury standards in the nation. For Kincaid, this proposal is especially unfair as it
places the plant at a competitive disadvantage for several reasons
. First, Section 225 .232 of the
proposed rule provides affected sources with a means for combining emissions from multiple
units to average a 90% overall reduction in mercury emissions for the first few years of the
program
. However, the rule allows this averaging only among existing sources under common
ownership, or among a very short list of single-facility companies . For the larger Illinois utility
companies affected by this rule, this "Averaging Demonstration" could include as many as 19
different units
. Kincaid, on the other hand, is given the opportunity to average among many
fewer units, owned by other companies . Kincaid also is effectively forced into a "sellers'
market," trying to strike a deal with companies that likely will have no incentive to enter into an
agreement to average emissions other than to generate revenue . Because Kincaid would have to
enter into some financial agreement with another company and because the pool of units that
would be eligible for inclusion in an "Averaging Demonstration" is so much smaller than the
pool available to the larger companies, this provision creates an unequal, unfair playing field for
Kincaid.
Second, the IEPA testimony at the June 22 Board hearing confirms that the proposal specifically
excludes Kincaid from one of the very few compliance options and thus places Kincaid at a
severe competitive disadvantage (June 22 testimony of Dr . Staudt, page 159) . The so-called
TTBS, or Temporary Technology Based Standards, limits the availability of its use to no more
than 25% of the total capacity of all the EGUs in that category . Since Dominion's coal-fired
capacity in Illinois consists solely of the Kincaid plant with its two 625-megawatt units, seeking
the TTBS for one of these units would exceed the 25% capacity restriction and therefore preclude
5
its eligibility
. The IEPA testimony before the Board on June 22 shows that the IEPA proceeded
to propose limited access to this TTBS against the advice of its technology expert . The agency
has described the TTBS as a measure of "flexibility" but has limited availability of this flexibility
to only the large utility companies in Illinois, which is unfair .
When combined, the TTBS and intra-company averaging demonstrations provide larger
companies several options to avoid violations if installing ACI or HACI does not achieve the
90% reductions
. If ACI or HACI were not to work at Kincaid, then Kincaid will be in violation
absent any workable flexibility options that are otherwise provided to the larger companies in the
current proposal .
7. CONCLUSION
Because Dominion's Kincaid facility is uniquely disadvantaged by the IEPA proposed mercury
rule, we urge the Board not to adopt the Agency proposal as applicable to Kincaid .
Respectfully submitted,
By:
Dated
: July 28, 2006
Bill S . Forcade
Jenner & Block LLP
One IBM Plaza
Chicago, IL 60611
(312) 222-9350
CHICAGO
-
] 432451 2
6
BEFORE THE ILLINOIS POLLUTION CONTROL BOARD
In The Matter of:
)
Proposed New 35
111. Adm. Code Part 225 )
R06-25
Control of Emissions from
)
(Rulemaking - Air)
Large Combustion Sources
)
KINCAID GENERATION LLC'S PREPARED TESTIMONY OF ANDY YAROS
1 . INTRODUCTION
My name is Andy Yaros and I am Manager Fossil and Hydro Operations for Dominion's Fuel
and Environmental Excellence unit . I have been with Dominion for thirty years and have held
various management positions with Dominion . Much of my early career was involved in all
aspects of utility fuel procurement - coal, oil, and natural gas . I was Station Manager at the 900-
megawatt coal-fired Clover Power Station in Clover, Virginia during the 1990s and most recently
have headed up the primary environmental strategy development unit for Dominion since 2002 .
I hold an MBA from the University of Richmond (1982), an MS in Nuclear Engineering from
the, University of Cincinnati (1977) and a BS from Centre College of Kentucky (1975) .
2. PARALLELS DRAWN FROM CLOVER MERCURY EXPERIENCE (ICR STACK
TESTING, USEPA MONITORING DEMONSTRATION .
It was during my tenure at the Clover Power Station that I first became familiar with mercury
emissions characterization from utility boilers . The Clover plant conducted mercury stack testing
as part of the USEPA 1999 Information Collection Request under Section 114 of the Clean Air
Act. The Clover plant, which bums eastern bituminous coal, began operation in 1995 and the two
units were designed with wet scrubbers and fabric filters . The mercury stack tests revealed
excellent removal of mercury from the flue gas - approximately 94% .
RECEIVED
CLERK'S
OFFICE
JUL 2 8 2006
Pollution
STATE OF
Control
ILLINOISBoard
Dominion's Clover plant also participated during 2003 in an EPA-sponsored mercury continuous
emissions monitoring (CEMs) evaluation. The evaluation included three different CEMs and was
conducted over a three-month period. Many problems were identified during the evaluation, and
while much progress has been made since 2003, this early evaluation highlights a continuing
problem with the current state of the mercury CEMs technology - the capability of the
technology to measure very low concentrations of mercury . As we have heard from earlier
witnesses, the precision and accuracy of the mercury measurements required for the proposed
Illinois mercury rule
- on the order of 1 .0 ug/m3 - are just not achievable at this point .
3. PROBLEMS WITH HALOGENATED ACTIVATED CARBON INJECTION AT
KINCAID
The IEPA has presented technical documentation that defends the agency's position that 90%
mercury control technology is currently available for the coal-fired power plants in Illinois . The
IEPA Technical Support Document references a number of enhanced sorbent injection field
demonstrations that are either on-going or have been completed . Several demonstrations are
worth comparing to the situation at Dominion's Kincaid plant, i.e., use of western sub-
bituminous coal, with a cold-side ESP for particulate control . These include the field
demonstrations at Pleasant Prairie, Meramac, Monroe and St . Clair power plants .
Pleasant Prairie : This demonstration was first conducted over three five-day tests with untreated
PAC (powdered activated carbon) injection, with mercury capture rates of between 46-66% .
These longer-term tests were followed by a pilot-scale test using halogenated PAC . The pilot-
scale tests showed mercury collection of about 90% . Pilot-scale tests are used to determine if
2
larger-scale tests should proceed. Pilot-scale results should not be included in the IEPA
technology document unless the agency is making the case that more testing of this technology is
needed before it can be truly claimed to be "commercially available" . It should be noted that the
ESP for the Pleasant Prairie unit is larger than most and the PAC-laden flyash was not
marketable following collection . From the Department of Energy/National Energy Technology
Laboratory (DOE/NETL) report :
"Although ACI did not deteriorate ESP performance, the ESP was relatively large (468
f2/1000 acfm specific collection area, SCA) and additional testing needs to be conducted
on units with smaller ESPs. However, the PAC in the fly ash rendered the ash unsuitable
for sale as a supplement for Portland cement in concrete."
Since a full-scale test of the halogenated PAC injection technology at Pleasant Prairie has not
been scheduled, DOE/NETL does not include this test in subsequent test report updates .
Meramec: Several full-scale test demonstrations of enhanced activated carbon injection, such as
brominated activated carbon, have shown high mercury capture over 30-day tests in boilers
burning western sub-bituminous coals with moderately sized ESPs . The Meramac test included
injection of "DARCO Hg-LH" activated (brominated) carbon into a 140-megawatt sub-
bituminous coal-fired boiler . The ESP SCA was about 320 ft2/ 1000 acfm . The results were
impressive, as average mercury reduction over the 30-day test was about 93%
. However, several
problems arose during the test . First, the high mercury removal rates may have been influenced
by site-specific characteristics . During the test, very high particulate-phase mercury levels were
observed at the ESP inlet; a very unusual situation for western sub-bituminous coals . This
apparently was caused by higher LOI (loss on ignition) carbon in the ash, caused by coal mill
problems
. Other problems made it difficult to adequately evaluate the impact of carbon injection
3
on ESP operation
. Further, the activated carbon in the fly ash rendered the ash unmarketable for
cement applications
.
Monroe:
DTE's 785-megawatt Monroe Station Unit 4 burns a 60/40 blend of sub-
bituminous/bituminous coal with a 258
ft2/ 1000 acfn cold side-ESP . Preliminary results of
standard vs
. brominated activated carbon injection testing at Monroe were presented by Sharon
Sjostrom of ADA-ES at the January 2006 Electric Utilities Environmental Conference in Tucson,
Arizona
. The results indicate higher mercury reductions were achieved with the untreated
carbon
. More importantly, none of the tests showed a 90% mercury reduction . Once again, the
presence of activated carbon in ash will most likely prevent sale of the ash for use in concrete
.
St. Clair : DTE's St
. Clair Power Plant in Michigan bums an 85/15 blend of sub-
bituminous/bituminous coal
. The 30-day demonstration of brominated PAC on the wall-fired
158-megawatt St
. Clair Unit I produced very high mercury capture results - averaging 93% over
the first 25 days
. As it has been noted previously at these hearings, it is important to note that the
ESP at St
. Clair Unit 1 is quite large at an SCA of 700
ft2/ 1000 acfm and this could have
influenced the high mercury capture rates during the test . Further, it should be noted that the tests
revealed a considerably higher (>50%) "native" mercury removal when firing 85% sub-
bituminous coal than with 100% sub-bituminous coal . This may indicate the larger ESP had a
greater impact on reducing mercury for bituminous coals than sub-bituminous coals, at least part
of which may be attributable to the higher chlorine in the bituminous share .
4
Dominion agrees the halogenated sorbent injection technologies may present the most effective,
lowest cost alternative for mercury control from sub-bituminous coals
. Dominion also agrees
with recent reports that this technology, though rapidly advancing, is not yet truly commercially
available on a wide scale
. According to USEPA : "While it is more difficult to remove mercury
from the flue gas of boilers firing low-rank coals with standard PAC (powdered activated carbon)
injection, new halogenated sorbents appear to offer a very effective and less expensive alternative
that can deliver higher removals than possible with standard PAC alone . However, longer-term
demonstrations will be beneficial in that they will provide additional experience and data, which
will build confidence in use of these new sorbents
. . . it is believed that PAC injection and
enhanced multipollutant controls will be available after 2010 for commercial application on
most, if not all, key combinations of coal type and control technology to provide mercury
removal levels between 60 and 90%
."
Several of these full-scale demonstrations, particularly Meramec and St
. Clair, have yielded some
very promising results
. The demonstrations have also revealed some serious concerns . Dominion
believes the relative success of this first round of testing is justification for additional longer-term
testing and further evaluation
.
Dominion believes there are still too many questions to be answered before we could commit to
halogenated ACI at Kincaid as a means of complying with the 90% reductions required by the
Illinois mercury rule :
5
• First, as has been pointed out previously, the specific collection area (SCA) of the cold-side
ESPs for the Kincaid units are about 320 (average) -
less than half the St . Clair unit.
•
The demonstrations that best minor the Kincaid situation (St
. Clair and Meramec) are much
smaller units (158 megawatts and 140 megawatts, respectively) than the 625-megawatt units
at Kincaid.
•
The cyclone firing design of the Kincaid units may affect sorbent performance - we note that
none of the demonstrations cited in the IEPA Technical Support Document that are
comparable to the Kincaid situation (PRB coal with cold-side ESP) are for boilers with the
cyclone firing design
.
•
The speciated data for the coal burned at Kincaid varies considerably from several of the
tests
. The speciated test results for the Kincaid sub-bituminous coal is higher in elemental
mercury (55%) than the coal at Meramec (62% oxidized, 38% elemental)
•
While these results are certainly cause for some optimism, they are all relatively short-term
tests, reflecting merely a snapshot of what may be achievable .
As I stated previously, my primary role in Dominion's Fuel and Environmental Excellence group
is to coordinate the "enterprise-wide" environmental compliance strategy for the entire Dominion
fossil fuel-fired generation fleet
. Risk tolerance is certainly a factor we consider in developing
what is a constantly evolving plan for Dominion's 28,000+ megawatts of electric generation in
11 states
. One risk we do not tolerate is non-compliance with environmental requirements
.
The unavailability of fully demonstrated commercial technology to achieve 90% mercury
reduction forces Dominion to assume, at this point, that the IEPA mercury proposal will require
much higher control costs than IEPA has suggested .
6
IEPA representatives have stated several times during the February "outreach" meetings that
capital costs for compliance with this 90% mercury proposal will cost "$2 million per unit" .
While the estimated costs for halogenated PAC appear to be relatively favorable, there are
entirely too many questions associated with this technology at this point to consider it in any
prudent compliance planning that seeks no risk of non-compliance .
Therefore, Dominion, and other Illinois utilities, must rely on fully demonstrated technologies for
planning purposes
. The IEPA technical support document references the "TOXECON" project
currently underway at WE Energies' Presque Isle plant in Michigan . This project includes
installation of an ACI system in addition to a fabric filter system . The IEPA document suggests
capital costs for a TOXECON system would be "typically in the range of about $40-$60/KW ."
The document describes the Presque Isle project as "unusual" and fails to include the projected
costs for the project, which, according to the recent design study conducted for WE Energies, are
reported to be equivalent to a capital cost of $120/KW . If the WE Energies costs estimates are
correct, it would project a $150 million capital cost for TOXECON installation at Kincaid .
Dominion has not yet made public any information concerning mercury compliance planning for
the 1250-megawatt Kincaid station . Our current cost estimate for compliance at Kincaid
approximately $130 Million simply for installation of the baghouse filters the TOXECON system
would require, substantially higher than IEPA is expecting .
7
4. CONCLUSION
Dominion is committed to mercury reductions across our generation fleet and we are developing
a comprehensive emissions reduction strategy to ensure full compliance with the federal Clean
Air Mercury Rule (CAMR) provisions
. As we have stated, good maintenance and optimization of
our existing air pollution control equipment can contribute significantly to the overall reduction
in mercury
. We have a solid basis now to proceed with planning for compliance with the Phase 1
CAMR reductions at Kincaid and we are optimistic that the technology to achieve greater levels
of mercury reduction from sub-bituminous coal will be fully available within the deadlines for
compliance with Phase 2 of the CAMR rules
. We urge the Illinois Pollution Control Board not to
adopt the mercury control regulatory language proposed by the IEPA
.
Respectfully submitted,
By:
Dated : July 28, 2006
Bill S . Forcade
Jenner & Block LLP
One IBM Plaza
Chicago, IL 60611
(312) 222-9350
CHICAGO] 432478 2
8
