ELECTRONIC FILING,

RECEIVED,

CLERK’S OFFICE

NOVEMBER 3,

2005

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PCB 2006-073

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HF FORI’

Jill

Ill

INOJ’~Pot

11)1

JOiN

C

ON

I

111)1

BOA

U

DYNEGY

MIDWEST

GENERATION,

INC.

(VERMILION

Petitioner,

V.

ILLINOIS

Respondent.

)

)

)

)

)

PCB

___________

(Permit Appeal

—

Air)

)

)

)

)

NOTICE OF

FILING

To:

Pollution Control Board, Attn:

Clerk

James R.

‘Thompson

Cenlcr

100 W. Randolph

Suite

11-500

Chicago, Illinois

60601

Division of Legal Counsel

Illinois Environmental

Protection

Agency

1021

North Grand Avenue, East

P.O.

Box

19276

Springfield, Illinois

62794-9276

PLEASE

TAKE

NOTICE that I have today filed with the 0111cc

of the Clerk of the

Pollution control Board the original and nine

copies of the Appeal of CAAPP Permit of

flyrmegy

Midwest

Generation, Inc. (Vermilion

Power Station)

and the

Appearances of

Sheldon

A.

Zahel, Kathleen C.

Bassi,

Stephen

J.

Bonebrake,

Joshua

R.

More,

and

Kavita M.

Patel,

copies of which are

herewith served

upon

you.

Kathleen C.

Bassi

Dated:

November

3, 2005

Sheldon

A.

Zabel

Kathleen C. Bassi

Stephen J. Bonebrake

Joshua

R. More

Kavita M.

Patel

SCHIFF HARDIN, LLP

6600

Sears Tower

233

South

Wacker Drive

Chicago,

Illinois

60606

Fax:

312-258-5600

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ELECTRONIC

FILING,

RECEIVED, CLERKS

OFFICE

NOVEMBER 3,

2005

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FOB 2006-073

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BEFORE THE ILLINOIS

POLLUTION CONTROL

BOARD

/

6 INA

L

)

P03

)

(Permit Appeal

—

Air)

DYNEGY MIDWEST GENERATION, INC.

(VERMILION POWER

STATION),

)

Petitioner,

)

)

V

ILLINOIS ENVIRONMENTAL

PROTECTION

AGENCY,

Respondent.

)

)

)

)

APPEARANCE

Ihereby

file my appearance in this proceeding,

on behalf of Dynegy Midwest

Generation,

Inc. (Vermilion Power Station).

Sheldon

A. Zabel

November

3, 2005

Kathleen

C.

Bassi

Stephen J.

Bonebrake

Joshua R. More

Kavita M. Patel

SCHIFF FIARDIN, LLP

6600 Sears Tower

233

South Wacker Drive

Chicago,

Illinois

60606

312-258-5500

Sheldon A

Za’

Dated:

Fax:

312-258-5600

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ELECTRONIC

FILING,

RECEIVED, CLERK’S

OFFICE

NOVEMBER

3,

2005

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FOB 2006-073

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BEFORE

TIlE ILLINOIS POLI4tITION CONTROL BO.ARI)

DYNEGY

MIDWEST GENERATION, INC.

)

r~

fl

I

C

I

NI 1~

L

(VERMILION

POWER STATION),

I,~ N 1011

‘1

r’

)

Petitioner,

)

v.

)

PCB

______________

(Permit Appeal

—

Air)

ILLINOIS ENVIRONMENTAL

PROTECTION

AGENCY,

Respondent.

)

APPEARANCE

I

hereby file my appearance in this proceeding, on behalf of Dynegy Midwest

Generation,

Inc. (Vermilion

Power Station).

-s

Kathleen

C. Bassi

Dated:

November

3. 2005

Sheldon

A.

Zahel

Kathleen C.

Bassi

Stephen J. Bonebrake

Joshua R.

More

Kavita M.

Patel

SCI-JIFF HARDIN, LLP

6600

Sears Tower

233

South

Wacker

Drive

Chicago,

Illinois

60606

312-258-5500

Fax:

312-258-5600

---

ELECTRONIC

FILING,

RECEIVED, CLERK’S OFFICE

NOVEMBER

3,

2005

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*

FOB

2006-073

*

*

*

*

*

BEFORE THE ILLINOIS

(VERMILION POWER

Petitioner,

V.

Respondent.

)

)

)

)

APPEARANCE

CONTROL BOARQ

R / GI

)

)

)

)

)

PCI3

__________

)

(Permit Appeal

—

Air)

I hereby

file my appearance in this proceeding, on behalf of

Dynegy Midwest

Generation, Inc.

(Vermilion

Power Station).

Sheldon

A, Zabel

Kathleen

C.

Bassi

Stephen J. Bonebrake

Joshua R.

More

Kavita M. Patel

SCHIFF

HARDIN, LLP

6600 Sears Tower

233

South Wacker Drive

Chicago, Illinois

60606

312-258-5500

Fax:

312-258-5600

IVAL

Dated:

November

3, 2005

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ELECTRONIC

FILING,

RECEIVED,

CLERK’S OFFICE

NOVEMBER

3,

2005

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FOB 2006-073

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*

*

*

*

BEFORE TIlE

ILLINOIS POLLUTION

CONTROL IJOARI)

DYNEGY MIDWEST GENERATION, INC.

)

OR

I Gi N AL

(VERMILION

POWER STATION),

)

)

Petitioner,

)

v.

)

PCB

____________

)

(Permit Appeal

—

Air)

ILLINOIS

ENVIRONMENTAL

PROTECTION AGENCY,

)

)

APPEARANCE

I hereby file my appearance in this proceeding, on behalf of Dynegy Midwest

Generation,

Inc.

(Vermilion Power Station).

/

,,

_/_

---

-

/

X

/

I

L-

/7

(j’

~

______

Joshua R. More

Dated:

November

3, 2005

Sheldon A.

Zabel

Kathleen

C.

Bassi

Stephen

J.

Bonebrake

Joshua

K. More

Kavita M.

Patel

SCHIFF

HARDIN, LLP

6600

Sears Tower

233

South Wacker Drive

Chicago,

Illinois

60606

312-258-5500

Fax:

312-258-5600

---

ELECTRONIC FILING,

RECEIVED,

CLERK’S OFFICE

NOVEMBER

3,

2005

*

*

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*

*

POB 2006-073

*

*

*

*

*

~

BEFORE

I’HE ILLINOIS POLL L’I’ION

CONTROL BOAR!)

DYNEGY MIDWEST GENERATiON, INC.

)

(VERMILION POWER STATION),

)

)

Petitioner,

)

)

V.

)

PCB

___________

)

(Permit

Appeal

—

Air)

ILLINOIS ENVIRONMENTAL

PROTECTION

AGENCY,

)

Respondent.

)

APPEARANCE

I hereby tile

my appearance in this proceeding,

on behalf of Dynegy Midwest

Generation, Inc. (Vermilion Power Station).

_Y~

___

Kavita

NI.

Paid

Dated:

November 3, 2005

Sheldon

A.

Zabel

Kathleen C.

Bassi

Stephen

J. Bonebrake

Joshua R.

More

Kavita M.

Patel

SCHJFF HARD1N,

LLP

6600 Sears Tower

233 South Wacker Drive

Chicago, Illinois

60606

312-258-5500

Fax:

312-258-5600

---

ELECTRONIC

FILING,

RECEIVED, CLERK’S OFFICE

NOVEMBER

3,

2005

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*

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FOB 2006-073

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*

*

*

*

BEFORE

TIlE

ILLINOIS

POLLUTION

CONTROL

BOARD

I)YNEGY MIDWEST GENERATION, INC.

(VERMILION POWER

STATION),

Petitioner,

ILLINOIS

Respondent.

)

)

)

)

)

ORIGINAL

PCB

____________

(Permit Appeal

—

Air)

)

OF

SERVICE

1, the undersigned,

certify

that

I

have

served

the

attached Appeal of CAAPP

Permit of

Dvne~’Midwest Generation, Inc.

(Vermilion Power Station)

and Appearances of Sheldon

A.

Zabcl, Kathleen

C.

Bassi, Stephen

J. Bonebrake, Joshua R.

More, and Kavita M.

Patel,

by electronic delivery upon

the following

person:

Pollution Control Board, Attn:

Clerk

James

R.

Thompson Center

100

W,

Randolph

Suite

11-500

Chicago,

Illinois

60601

‘4~óh~a

4fl1c-t

~en~.Ba~

Dated:

November

3,

2005

and

by clcctronic and first class

mail upon

the following person:

Division of Legal Counsel

Illinois Environmental Protection

Agency

1021

North Grand Avenue, East

P.O.

Box

1 9276

Springfield,

Illinois

62794-9276

Sheldon

A. Zabel

Kathleen

C.

Bassi

Stephen J.

Bonebrake

Joshua

R.

More

Kavita M. Patel

SCIIIFF

FTARDIN, LLP

6600

Sears Tower

233

South Wacker Drive

Chicago, Illinois

60606

32-258-5500

Fax:

312-258-5600

---

ELECTRONflC

FILING,

RECEIVED, CLERK’S OFFICE

NOVEMBER 3,

2005

*

*

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*

*

POB 2006-073

*

*

*

*

*

BEFORE THE

ILLINOIS

POLLUTION

DYNEGY MIDWEST GENERATION,

INC.

(VERMILION POWER STATION)

)

Petitioner,

v.

)

PCB

____________

(Permit Appeal

—

Air)

ILLINOIS

ENVIRONMENTAL

)

PROTECTION

AGENCY,

)

Respondent.

APPEAL

OF CAAPP PERMIT

NOW

COMES Petitioner, DYNEGY

MIDWEST GENERATION,

INC. (VERMILION

POWER STATION) (“Petitioner,” or “DM0”), pursuant to Section

40.2 of the

Illinois

Environmental Protection Act (“Act”) (415 ILCS 5/40,2) and 35

Ill.Adm.Code

§

105.300

c/seq.,

and requests a hearing before

the

Board to

contest the permit issued to Petitioner on September

29, 2005, under

the

Clean Air Act Permit Program (“CAAPP” or “Title V”) set forth at Section

39.5

of the Act (415

ILCS

5/39.5).

Although this appeal contests many specific provisions of the

permit, these specific provisions are so intertwined with the remaining provisions that

it would

be

impractical to

implement those remaining

provisions.

Therefore, DM0

appeals the permit as

a

whole.

In support of its

Petition, Petitioner states as

follows:

L

BACKGROUND

(35

III.Adm.Code

§

105.304(a))

1.

On November

15,

1990, Congress amended

the Clean Air Act (42 U.S.C.

§~

7401-7671q) and included

in the amendments at Title V a requirement for a national

operating permit program.

The

Title V program was

to

be implemented by

states with approved

programs.

Illinois’ Title V program,

the CAAPP,

was fully and finally approved by

the U.S.

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ELECTRONIC

FILING,

RECEIVED, CLERK’S OFFICE

NOVEMBER 3,

2005

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Environmental Protection Agency

(“USEPA’) on December 4,2001(66 Fed.Reg.

72946).

‘Ihe

Illinois Environmental Protection Agency

(Agency’)

has had the authority

to

issue CAAPP

permits

since

at least March

7,

1995, when the state was granted interim approval of its CAAPP

(60 Fed.Reg.

12478).

Illinois’ Title

V

program

is

set

forth at Section

39.5

of the Act. 35

Ill. Adm

Code

201

Subpart F. and 35

Ill.Adm

Code Part 270.

2.

The Vermilion Power Station (‘Vermilion” or

the

“Station”), Agency

ID.

No.

1838 I4AAA.

is

an electric

generating station owned and operated by DMG.

The

Vermilion

electrical generating units (“EGUs’~)

went online bet~~een

roughly

1948

and

1962.

The

Station

is

located at 2150 N.

County Road, Oakwood. Illinois 61858.

DMG employs

approximately 53

people

at the Vermilion Power Station.

3.

DMG operates two coal-fired boilers at Vermilion

that have the capability to fire

at various modes

that include

the combination

of coal and/or

natural

as their principal fuels.

in

addition, the

boilers fire natural

gas as auxiliary

fuel

during

startup and for flame stabilization.

Certain alternative

fuels may

be utilized as

well.

DMG also

operates one natural gas and

distillate oil

fired boiler.

In addition to the boilers, DM6

operates one distillate oil-fired internal

combustion engine

to start one distillate oil fired

turbine, used during peak

demand

periods.

Vermilion also operates associated coal

handling, coal processing,

and ash

handling activities.

Finally, there

is a

1000-gallon capacity gasoline tank located at Vermilion.

4.

Vermilion

is a major source subject

to Title V.

The

two EGUs at Vermilion are

subject to both of Illinois’ NOx reduction programs:

the “0.25

averaging” program at 35

IlI.Adm.Code 217Suhparts

V and the “NOx trading program” or “NOx SiP call” at

35

lll,Adm.Code 2l7.Subpart

W.

Vermilion

is

subject to the

federal Acid Rain Program at Title IV

of the Clean

Air Act and has been issued a Phase

II Acid Rain

Permit.

-2-

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ELECTRONIC

FILING,

RECEIVED, CLERKS

OFFICE

NOVEMBER

3,

2005

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5.

Currently NOx emissions

from

Boiler

1

arc controlled

by rotating

over—lire

air

and Boiler 2 are

controlled by low NOx burners and over-lire air,

Emissions of SO2

from the

boilers are controlled by limiting the sulfur content

of the fuel

used for the boilers.

PM

emissions

from

Boilers

I

and 2 are controlled

by an electrostatic precipitator (“ESP”) with a

flue

gas conditioning system.

Fugitive PM emissions

from

various coal

and

ash handling activities

are controlled through baghouses, enclosures, covers, and dust suppressants, as

necessary and

appropriate.

Emissions of carbon monoxide (“CO”) are

limited through good combustion

practices in the boilers.

VOM emissions from

the gasoline storage tank are

controlled by the use

of a submerged loading pipe.

6.

The Agency received the original

CAAPP permit application for

the

Station in

about September,

1995,

and assigned Application No.

95090096.

‘he

CAAPP permit

application was timely

submitted and updated,

and Petitioner requested and

was granted an

application shield,

pursuant to Section 39.5(5)(h).

Petitioner has paid fees as

set forth at Section

39.5(18) of the Act since 2000

in connection with the CAAPP

permit for the Station.

The

Station’s state operating permits have continued in full

force and effect since submittal of the

CAAPP permit application, pursuant to Sections 9.1(t) and 39.5(4)(b)of the Act.

7.

The Agency issued

a draft permit for public

review on June 9,

2003.

The

Agency

subsequently held a hearing on

the

draft permit in August 2003.

DM0

filed

written comments

with the Agency regarding the

Vermilion draft permit.’

8.

The Agency issued

a proposed permit for

the Vermilion Station on

October

10,

2003.

This pennit was

not technically

open for public comment, as

it had been

sent to USEPA

DMG

has attached

the

appealed

permit to this

Petition.

1-lowcvcr, the

draft and

proposed

permits

and

other

documents

referred

to herein should be

included in the administrative

record that the Agency

will

file.

Other

documents

referred

to

in this

Petition,

such as cases or

Board

decisions,

are easily

accessible.

In the

interest of

economy, then, DMG is

not attaching such documents to this

Petition.

-3-

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ELECTRONIC

FILING,

RECEIVED,

CLERK’S OFFICE

NOVEMBER 3,

2005

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for its comment as required

by

litlc

\/~Subsequently.

in

Dccciriber 2004.

the Agcncy

issued

a

draft revised

proposed permit

and requested comments of Petitioner and

other interested

persons.

DM0 again commented.

The Agency

issued a second

draft revised

proposed permit

in July

2005

and allowed the Petitioner and other interested persons

10

days to

comment.

At

the same

time, the

Agency released its preliminary

Responsiveness

Summary, which was a draft outs

response to comments, and invited comment on

that

document as

well.

DM0 submitted

combined comments

on this version of the pennit

for Baldwin and for

its four other generating

stations together,

as well as

on the preliminary Responsiveness Summary.

he

Agency

submitted the

revised proposed permit to LJSEPA

for its 45-day review on August

IS,

2005.

The

Agency did

not

seek

further comment on

the permit

from the

Petitioner or other

interested

persons,

arid DM0 has not submitted any further comments, based upon the

understanding that

the

Agency had every intention to issue

the permit at the

end of

LISEPA’s review period.

9.

The

final

permit was,

indeed, issued on

September 29, 2005.2

Although some of

Petitioner’s comments have

been addressed in the

various iterations of the permit,

it still contains

terms and conditions that are not acceptable to

Petitioner, including conditions

that are

contrary

to applicable law and conditions

that first appeared,

at least

in their final

detail,

in the August

2005

proposed permit and upon which Petitioner did

not have the

opportunity to comment.

It is

for these reasons that Petitioner hereby appeals the permit.

This permit appeal

is timely

submitted within

35

days following

issuance of the permit.

Petitioner requests that the

Board

review the permit, remand it to the Agency, and order the Agency to correct

and reissue the

permit, without

further public proceeding, as appropriate.

2

See

USEPA/Region

5’s

Permits

website at

http:!!wwweo~gov/region5/air/permits/ilonJne.ht,n

-3

‘CAAPP

permit

Records”

-3

“Dynegy

Midwest Generation Inc.”

for the source

located

at

#1

Chessen Lane,

Alton,

for the

complete “trail” of the

milestone action

dates

for

this

permit.

-4-

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ELECTRONIC

FILING,

RECEIVED, CLERK’S

OFFICE

NOVEMBER

3,

2005

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FOB 2006-073

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Ii.

EFFECTIVENESS OF PERMIT

10.

Pursuant to Section

10-65(b) of the

Illinois Administrative Procedures Act

(“APA”),

5

ILCS

100/10-65, and the holding in

Borg-Warner Corv

v.

Alauzy,

427 N.E. 2d

415

(III.App.Ct.

1981)

(“Borg-Warner”),

the

CAAPP

permit issued by

the

Agency

to

the Station does

not become effective

until

after a ruling by

the Board

on

the

permit appeal

and,

in the event of a

remand, until

the

Agency has issued the permit consistent with the

Board’s order.

Section

10-

65(b) provides

that “when

a licensee has made timely and

sufficient application

for

the renewal

of a license or

a new license with reference to any activity

of a continuing nature, the existing

license shall continue in full

force and

effect

until

the

final agency decision

on

the application

has

been made unless a later date

is

fixed by

order of a reviewing court.”

5

ILCS

100/10-65(b).

The

Borg-Warner

court found

that with respect to an

appealed environmental permit, the “final

agency decision”

is the

final decision by the Board in

an

appeal, not

the issuance

of the permit by

the

Agency.

Borg- Warner,

427 N.E.

2d 415 at 422;

see

also IBP,

Inc.

v.

IL Environmental

ProtectionAgency,

1989 WL

137356

(Ill. Pollution

Control

Bd.

1989);

Electric

Energy,

Inc.

v.

ILL

Pollution Control Bd.,

1985

WI. 21205 (III. Pollution Control Bd.

1985).

Therefore, pursuant

to the

APA as

interpreted by

Borg-Warner,

the entire permit is

not yet effective

and the

existing

permits

for the facility continue in effect.

11.

The

Act provides at Sections 39.5(4)(b) and 9.1(t) that the state operating permit

continues

in effect until issuance of the

CAAPP permit.

Under

Borg-Warner,

the CAAPP permit

does not become effective

until

the Board

issues its

order

on this

appeal

and the Agency has

reissued

the permit.

Therefore, DMG currently has the necessary

permits

to

operate the Station.

In the alternative,

to avoid

any question

as

to the limitation on

the scope of the effectiveness of

the permit under the APA, DM0 requests

that the Board exercise

its

discretionary authority

at

35

-5-

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ELECTRONIC

FILING,

RECEIVED, CLERK’S OFFICE

NOVEMBER

3,

2005

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FOB 2006-073

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lll.Adm.Code

§

105.304(h)

and stay the entire permit.

Such

a stay

is necessary to protect

DMG’s right to appeal and

to avoid the imposition of conditions that contradict or

are

cumulative of the conditions

in the

prc-cxisting permits

before

it

is able to exercise that right to

appeal.

Further, compliance

with the myriad

of new monitoring,

inspection, recordkeeping.

and

reporting conditions that are

in the CAAPP permit will

be

extremely costly.

To comply with

conditions that are

inappropriate, as

DMG alleges

below, would cause irreparable harm

to DM0,

including the

imposition of these unnecessary costs and the adverse effect

on DMG’s right to

adequate review on appeal.

DM0

has no adequate remedy at law other than this appeal

to the

Board.

DM0

is likely to

succeed on

the merits of its appeal, as

the Agency has included

conditions that do

not reflect

“applicable requirements,”

as defined

by Title

V, and

has exceeded

its authority to impose permit

conditions and has

imposed pennit conditions that are arbitrary

and capricious.

See

Lone Star Industrie.~inc.

v.

IEPA,

PCB 03-94 (January 9, 2003);

Nielsen

&

Brainbridge,

L.L.C.

v.

JEPA,

PCB

03-98 (February 6, 2003);

Saint-Gobain

Containers,

inc.

v.

JEPA,

PCB

04-47 (November

6, 2003);

Champion Laboratories,

Jnc~v,

IEPA,

PCB

04-65

(January 8,2004);

Noveon,

Inc.

v,

IEPA,

PCB

04-102

(January 22, 2004);

Ethyl Petroleum

Additives,

Inc.,

v.

IEPA,

PCB 04-113 (February 5,2004);

Oasis Industriej~Inc.

v.

JEPA,

PCB

04-116 (May 6,2004).

Moreover,

the

Board has stayed

the entirety of

all the CAAPP permits

that have been appealed.

Additionally see Bridgestone/Firestone Off Road Tire

Company v.

IEPA,

PCB

02-3 I

(November

1, 2001);

Midwest Generation, LLC

-

Collins Generating Station

v.

JEPA,

PCB 04-108

(January 22, 2004);

Board of Trustees of Eastern Illinois

University v.

IEPA,

PCB 04-110 (February 5,2004).

The Board should continue to follow this precedent.

12.

Finally,

a large number of conditions included in this CAAPP permit

are appealed

here.

To allow

some conditions of the CAAPP permit to he

effective while

equivalent conditions

-6-

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ELECTRONIC

FILING,

RECEIVED, CLERK’S OFFICE

NOVEMBER

3,

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in the

old

state operating

permits remain eflèctive

under

Section

10-65(b) 01

the

illinois

APA

would

create

an

administrative environment that

would be,

to say the least, very confusing.

Moreover,

the

Agency’s failure to provide a statement of basis, discussed

below, renders the

entire permit defective,

Therefore. DMG requests

that the Board

stay the

entire permit

for these

reasons.

13.

in sum, pursuant to

Section

10-65(b) of the

APA and

Borg-Warner,

the

entirety of

the

CAAPP permit does not become

effective until

the completion of the

administrative process,

which occurs

when the Board has issued

its final ruling on the

appeal and the

Agency has acted

on any remand.

(For the sake of simplicity, hereafter the

effect of the APA

will be referred to as

a “stay”).

in the alternative, DM0 requests

that the

Board, consistent with its

grants of stay in

other CAAPP

permit appeals,

because of the pervasiveness

of the conditions appealed

throughout the permit, to protect DMG’s right to appeal and in the

interests of administrative

efficiency, stay the

effectiveness of the entire permit pursuant to its discretionary authority at 35

ill.Adm.Code

§

105.304(b).

In addition, such a stay will minimize the risk of unnecessary

litigation concerning the question of a stay and expedite resolution of the

underlying substantive

issues.

The state

operating permits currently in effect

will continue in effect throughout the

pendency of the appeal and remand.

Therefore, the Station will remain subject to the terms

and

conditions ofthose

permits.

As the

CAAPP permit cannot impose new substantive conditions

upon a permittee

(see

discussion below),

emissions limitations

are the same under both permits.

The environment will

not

be harmed by a stay of the CAAPP permit.

ilL

ISSUES

ON APPEAL

(35

1II.Adm.Code

§~

IO5.304(a)(2), (3),

and (4))

14.

As a preliminary matter, the CAAPP permits issued

to the Vermilion Power

Station and 20 of the other coal-fired power plants in the state

on the same date are very similar

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in content.

The same language appcars

in virtually

all of the permits, though there are

subtle

variations

to some conditions

to reflect

the elements of uniqueness that exists at

(he various

stations.

For example, not

all stations have the same

types of emissions units.

Some units in the

state

are subject to New

Source Performance Standards

(“NSPS”), perhaps

New Source Review

(“NSR”) or Prevention of Significant

Deterioration (“PSD”),

or other state or federal programs,

while others are not.

Applicable requirements may differ because of geographic location.

As a

result,

the appeals olthese permits

filed

with the

Board will

be repetitious with elements

of

uniqueness reflecting

the

various stations

circumstances.

Further,

the

issues

on appeal

span the

gamut of simple typographical errors to extremely complex questions of law.

Petitioner’s

presentation in

this appeal is by

issue

per

unit type, identifying the

permit conditions

giving rise

to the

appeal

and the conditions related to them that would be affected, should the l3oard grant

Petitioner’s appeal.

Petitioner appeals

all conditions

related to the

conditions

giving rise to the

appeal,

however, whether or not

such

related conditions are expressly identified below.

IS.

The Act does

not require

a permittee to have participated in the

public process;

the permittee merely

needs to object to a term

or condition in a permit in order to have standing

to appeal the permit issued to him.

See

Section 40.2(a)

of the

Act (the

applicant may appeal

while others need to have participated in the public

process).

However, DM0, as

will be

evidenced by the administrative record, has actively participated to the extent allowed by

the

Agency in the development of this permit.

In some instances,

as

discussed in further detail

below, the

Agency did

not provide DM0 with a viable opportunity to comment, leaving

DM0

with appeal as

its only alternative as a means of rectifying inappropriate

conditions.

These

issues

are properly before the

Board in this proceeding.

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16.

Section 39.S(7)(d)(ii) of the Act

grants the

Agency

limited authority to “gapfill.”

“Gapfiuling” is

the inclusion in the permit

of’ periodic monitoring requirements, where the

underlying applicable requirement does not include them.

Section 39.7(7)(d)(ii) faithfully

reflects 40

CFR

§

70.6(a)(iii)(B),

the

subject of litigation

in

Appalachian Power Company ~

EPA,

208 F.3d

1015

(D.C. Cit. 2000).

The court in

Appalachian Power

found that state

authorities

are precluded from

including provisions in permits requiring more

frequent

monitoring3 than is required in the underlying applicable

requirement unless the applicable

requirement contained no

periodic testing or monitoring, specified

no frequency

For the

testing or

monitoring, or required

only a one-time

test.

Appalachian Power

at

1028.

17.

The

Appalachian Power

court also

noted that “Title V does

not impose

substantive new requirements”

and that test

methods and the frequency at which they are

required “are surely ‘substantive’

requirements;

they impose duties and obligations on those who

are regulated.”

Appalachian Power

at 1026-27.

(Quotation marks and citations in original

omitted.)

Thus, where the permitting authority, here the Agency, becomes over-enthusiastic in

its gapfilling,

it

is

imposing new substantive requirements contrary to Title V.

18.

The Agency, indeed, has engaged in gapfihling, as

some of the Board’s underlying

regulations do

not provide specifically for periodic monitoring.

C.f,

35

lll.Adm.Code

212. Subpart E.

However, the Agency has also engaged in over-enthusiastic

gapfilling in some

instances,

as discussed in detail below.

These actions

are arbitrary and capricious and

are an

unlawful assumption of regulatory authority not granted by

Section

39.5

of the Act.

Moreover,

contrary to

Appalachian Power,

they, by their nature,

unlawfully constitute the imposition of

new substantive requirements.

Where Petitioner identifies inappropriate

gaplilling as

the basis

Note

that

testing

may

be

a type of monitoring.

See

Section

39.5(7)(d)(ii)

of the

Act.

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For

its objection to

a term

or condition of the permit.

Petitioner requests that

the Board assume

this preceding discussion of gaphlling

as part of that discussion of the

specific term

or condition.

19.

In a number of instances speciflcally identified

and discussed below, the Agency

has failed

to provide required citations

to the applicable requirement.

“Applicable requirements”

are those substantive requirements that have been

promulgated or approved by USEPA pursuant

to the

Clean Air Act which directly

impose requirements upon

a

source, including those

requirements set

forth in

the statute or regulations that are part of the

Illinois SIP.

Section

39.5(1).

General procedural-type requirements

or authorizations are not

substantive “applicable

requirements” and are

not sufficient basis

for a substantive term

or condition in the permit.

20.

The

Agency has cited generally to Sections

39.5(7)(a). (b), (e) and (f) of the Act

or

to

Section 4(h)

of the Act, but

it has not

cited to the

substantive applicable requirement that

serves

as

the basis

for the contested condition

in the permit.

Only applicable requirements may

be included in the

permit,4 and the Agency

is required by Title V to identify

its basis for

inclusion of a permit condition (Section

39.5(7)(n)).

If the

Agency cannot cite

to the applicable

requirement

and the condition

is not proper gapfilling. the

condition cannot

be

included in the

permit.

The

Agency has confused

general data- and information-gathering authority with

“applicable

requirements.”

They are not the

same.

Section 4(b) of the Act cannot be converted

into an applicable requirement merely because the Agency

includes it

as the basis for a

condition.

Failure to cite the

applicable requirement

is grounds for the Board to

remand the term

or condition to the

Agency.

21.

Moreover, the

Agency’s assertion in the

Responsiveness Summary that its general

statutory

authority serves as

its authority to include conditions

necessary to “accomplish the

In

its discussion ofgapfilting,

the

Appalachian

Power

coup notesthat “Title V does not

impose

substantive new

requirements”

208

F.3d

at

1026.

(Interna’

quotation

marks

and citations omitted).

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purposes of the

Act” misstates what

is actually in

the

Act.

Responsiveness

Summary, p.

15;

see

Section 39.5(7)(n).

Section 39.5(7)(a) says that the permit is

to contain conditions necessary to

“assure compliance with all

applicable requirements.”

(Emphasis

added.)

For the Agency

to

assume broader authority than that

granted by the

Act is

unlawful and arbitrary

and capricious.

22.

Another general

deficiency of the CAAPP permitting process in

Illinois

is the

Agency’s refusal to develop and issue a

Formal

statement of basis for the permit’s conditions.

This statement of basis

is to explain the permitting authority’s rationale

for the terms and

conditions of the

permit.

It is to explain

why the

Agency

made the decision it did, and it

is to

provide the permittee the opportunity to challenge

the Agency’s rationale

during the

permit

development process or comment period.

Title

V requires the permitting authority

to provide

such a statement of basis.

(Section 39.5(7)(n) of the

Act.)

The

Agency’s after-the-fact

conglomeration

of the

very short project summary produced at public

notice, the permit, and the

Responsiveness Summary are just not sufficient.

When the permittee and the public are

questioning rationale in comments,

it

is evident that the Agency’s view of a statement of basis

is

not sufficient.

Further, the Responsiveness

Summary is prepared after the fact;

it

is not provided

during permit development.

Therefore,

it cannot serve

as the

statement of basis.

The

lack of a

viable statement of basis,

denying the permittee notice of the Agency’s

decision-making

rationale and the

opportunity to comment thereon, makes the entire permit defective and is, in

and of itself, a basis

for appeal and remand of the permit and stay of the entire permit.

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A.

Issuance and Effective Dates

(Cover Page)

23.

The

Agency issued the CAAPP permit that is the

subject of this appeal

to DM0

on September

29,

2005, at about 7:17

p.m.

The Agency

notified DM0 that the permit had

been

issued through emails sent to DM0.

The email indicated

thai

the permits

were

available on

USEPA~swebsite, where

llinois’

permits

are

housed.

I lowever. that was

not

the ease.

DM0

was

not

able to locate the

permits on

the websitc that

evening.

24.

The issuance

date of the permit becomes important

because

that is also the date

that starts

the clock

for filing an appeal

and the

date, unless the permit is

appealed,

by which

certain documents must

he submitted to the

Agency.

IJSEP.A’s

website

identifies that date

as

September 29, 2005.

If that date

is also the effective date,

many additional deadlines would

be

triggered, including the

expiration date

as well as

the

date

by

which certain documents must be

submitted to the

Agency.

More critical, however,

is the

fact that once the permit

becomes

effective, DM0

would become

obligated to comply with

it (subject

to the stay of the permit as

discussed herein), regardless of whether

it had necessary

recordkeeping systems in place, the

necessary additional control equipment in place, and so

forth.

It took the Agency over two years

to issue

the final permit.

Over that course of time, the

Agency issued numerous

versions of the

pennit,

and it has changed considerably.

Therefore,

it would

be unreasonable

to

expect DMG to

have anticipated the

final permit to

the degree necessary

for it

to have been in compliance

by

September

29, 2005.

25.

Moreover, publication of the

permit on a website is not “official” notification in

Illinois.

The Petitioner cannot be deemed to “have” the permit until the original, signed version

of the permit has been delivered.

Neither Illinois’

rules

nor the

Act have been amended to

reflect

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electronic delivery of permits, especially by reference to a third party’s website.

Therefore, until

the permit is

officially delivered to a permittee,

it should not he deemed effective.

26.

Prior to the

advent of pervasive use of computers and reliance on

the

internet for

communication,

the Agency sent permits to sources through the

U.S.

Postal Service,just as this

CAAPP permit was delivered on October 3, 2005.

Neither the Act nor the regulations specify

when permits should become effective.

Prior to

the advent of Title

V, however, sources were not

subject to such numerous and delailed permit conditions, nor were they exposed to enforcement

from so many sides.

Under Title V, not only the Agency through the

Attorney

General, but also

USEPA and the

general public can

bring enforcement suits

for violation of the least

matter

in the

permit.

If’the issuance date

is the effective date, there is potential for tremendous

adverse

consequences to the permittee with

extremely inequitable effect.

27.

If the

effective date was September 2~,2005, that would also create

an obligation

to perform quarterly monitoring

and to submit quarterly reports,

(cf

Condition 7.1.10-2(a)),

for

the third quarter of 2005.

The third quarter reporting requirements would cover less

than 30

hours of operation.

A requirement to perform quarterly monitoring, recordkeeping, and

reporting for a quarter that consists of less than

30 hours of operation, assuming the permittee

would even have

compliance systems in place

so quickly after issuance of the permit, is overly

burdensome and would not benefit the environment in any manner.

Therefore, the requirement

is arbitrary and capricious.

28.

A lawful, and more equitable approach, would be for the Agency

to

delay the

effective date of a final permit after remand and reissuance

for a period of time reasonably

sufficient to allow sources to implement any new compliance

systems necessary because of the

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terms of the permit.

At

the very least, the

Agency should

delay the pennit effective date

until

the

time allowed

by law for the

source

to appeal the permit has expired.

29.

Consistent with the APA, the effective date of the

permit, contested herein,

is

stayed,

and DM0 requests that the Board order

the Agency

to

establish an effective date some

period of time after the permittee has received the

permit following

remand and reissuance of the

permit, to allow

the

permittee sufficient time

to

implement

the

systems

necessary to comply

with

all requirements in this very complex permit.

B.

Overall Source Conditions

(Section 5)

(i)

The

Permit Improperly Incorporates Consent I)ecree Requirements

30.

On May

27,

2005, the

United States District

Court for the

Southern District of

Illinois entered a Consent Decree in the

matter of the United States of America, et al.

v. Dynegy

Midwest Generation, et aL, Case No.

99-833-MJR

(the “Consent Decree”).

ihe CAAPP

Permit

refers

to the Consent Decree

as Attachment

7.

Under Paragraph

158 of the

Consent

Decree,

DM0

is required

within

180 days after entry of the Consent Decree

(by November 23,2005)10

amend any applicable Title V Permit Application, or

to apply for amendments of its Title V

permits, to include a schedule

for all “Unit-specific

performance, operational, maintenance, and

control technology requirements established by

the

Consent Decree

In Condition 5.4(a),

the Agency purports to

incorporate such

a schedule for the Ilennepin Station through

“Attachment

6 of this permit.”

As noted in Condition

5.4(a),

“Attachment 6”

is

referred to

in the

permit as the “Schedule.”

Condition 5.4(a) of the permit requires that DM0 comply with the

“requirements” of the

Schedule.

Further, under Section

157 of the Consent Decree, “any term or

limit established by or under this Consent

Decree shall be enforceable under this Consent

Decree

regardless of whether such

term has or will become a part of a Title

V permit

.

.

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31.

Although compliance with the requirements set

forth

in the

Schedule

is

already

required by Condition 5.4(a) and the Consent Decree also remains enforceable by

its terms,

many other sections of the permit also purport to require compliance with various

requirements

set forth on

the

Schedule.

See, ~

Conditions 5.4(a),

5.4(b),

5.7.3,

5.7.4,

7. 1.3(a)(ii),

7.l.3(b)(ii)(B). 7.l.3(c)(ii),

7.1.4(b)(ii), 7.1.4(e\ 7.1.6-1, 7.1.6-2. 7.l.7(a)(i),

7.l,7(a)(iii),

7.l.7(a)(v),

7.l.7(b)(iii)(B), 7.1.8(e), 7,1.9-2(b)(iv) and 7.l.12(b)(ii).

The

references

to,

and

the

characterizations and purported incorporation of Schedule or

Consent Decree requirements in

multiple conditions results in duplicative and potentially inconsistent obligations,

unauthorized

requirements, conffision and ambiguity.

For instance, as noted

in more

detail elsewhere

in this

Petition, Condition

7.1.1 2(b)(ii) of this permit purports to implement particulate

matter CEMS

provisions of the Consent Decree but, in reality, would if sustained, create an entirely new and

unauthorized obligation.

This

defect in

Condition 7.I.12(b)(ii),

and similar defects in some other

conditions that address or refer to

the Consent Decree, are separately

addressed

later

in this

petition.

Those specific

challenges illustrate the many problems caused by

including specific

conditions that refer to or otherwise attempt

to incorporate obligations or

provisions from the

Schedule or Consent

Decree, and highlight, in particular, why those conditions should he

deleted

from the permit.

Making specific

challenges to some conditions is, however, not intended to

implythat other conditions do

not suffer from similar defects, and should not

be

construed as

a

waiver of the request

in this section of the petition to delete

all conditions that refer to the

Schedule or Consent

Decree, with the exception of Condition 5.4(a).

32.

Given the

language of the Consent Decree and nature of its requirements, DMG

does

not object to Condition 5.4(a).

Inclusion of additional conditions in the permit,

however,

including Conditions

5.4(b) (including all of its subparts),

5.7.3 (including

all of its subparts),

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5.7.4,

7.1 .3(a)(ii),

7.1 .3(hXii)( H),

7.1 .3(c)(ii),

7.1 .4(h)(ii),

7.1 .4(c).

7.1

~W(

i),

7.1 .6—1

(including

all

subparts),

7.1.6-2(b), (c)

and (d) (including

all subparts),

7.1 .7(a)(i), 7.1 .7(a)(iii), 7.1 .7(a)(v),

7.1 .7(b)(iii)(B), 7.1.8(e), 7.1 .9-2(b)(iv) and 7.1. 12(b)(ii).

that purport to implement or adopt

requirements from

or otherwise characterize

or refer to the Consent

Decree

or Schedule,

and

conditions that reference or relate to such conditions is arbitrary and capricious and unauthorized

hy law

(the “Additional Consent

Decree

Conditions”).

33.

For these reasons, Additional

Consent Decree Conditions,

all contested herein,

are

stayed

in this proceeding consistent

with the APA, and DM0

requests that

the Board order the

Agency

to delete these conditions

and all references

to

these conditions from

the permit.

This

stay will have no

effect

on

the

enforceability of the

Consent Decree under

its

own terms.

(ii)

The Permit Incorrectly Requires

Compliance with Consent Decree Requirements

that Do

Not Accrue within the Term

of the Permit.

34.

The permit

in various conditions purports to specifically impose obligations with

respect to matters that are not

required under

the Consent

Decree prior to the stated

expiration

date

of the permit,

September 29,

2010.

Attempting to

impose in this permit requirements

that

do

not accrue until after

the termination date

of this permit

is arbitrary and capricious and

unauthorized by

law.

For example, Conditions 7.1.6-1(a),

(b) and (c)(ii)(B)

address emission

limitations applicable after

the expiration of the

stated five-year term ofthe

CAAPP permit.

35.

For these reasons, conditions

that address requirements under the Consent Decree

that arise after September 29, 2010, including Condition 7,1.6-1(a), (b) and (c)(ii)(B), and all

conditions that reference or relate to these

conditions, all contested herein, are stayed consistent

with the

APA, and DMG requests

that

the Board order the Agency

to delete these conditions and

all references to these conditions from

the

permit.

This stay will

have no

effect

on

the

enforceability of the Consent Decree under

its own

terms.

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(iii)

The

Schedule

Misconstrues Some

Consent

Decree Requirements and Incorrectly

Requires Compliance with

Certain Consent Decree

Requirements

that Arc

Not

Specific.

36,

According to

Condition 5.4(a), the

Schedule sets forth

“Unit-Specific

Performance, Operational, Maintenance,

and Control Technology Requirements

of’ the Consent

Decree

that Apply to the Vermilion Station

and, according

to the

Agency, the Schedule

is

“included in this permit pursuant to Paragraph

158 of the

Consent

Decree

The

Schedule,

however, includes requirements that are not

unit-specific and mischaracterizes certain Consent

Decree requirements.

37.

Contrary to Condition 5.4(a) and the

Consent Decree, Paragraphs

57,

58,

59, 60,

61, 62, 73,

74, 83, 87,

89, 91, 92, 94, 95, 96, 98, 99,

119,

125,

157, and

183 ofthe

Schedule

impose obligations

on

the Station that are not

unit-specific.

In addition,

Paragraphs 91, 92,

94,

95 and 96 of the

Schedule

attempt to impose requirements that arc

not currently applicable to a

Vermilion unit and that might not apply

in the future.

Paragraph

157 also misconstrues

the

Consent Decree

by purporting to

make the Schedule enforceable

under

the Consent Decree.

Furthermore, Paragraphs

42 and 44

do

not accurately recite the

language of the Consent Decree,

creating ambiguity and possibly

additional or inconsistent obligations.

Accordingly, these

Paragraphs of the

Schedule are

arbitrary and capricious and unauthorized by

law.

38.

For these reasons, Paragraphs 57, 58,

59, 60, 61, 62, 73,

74, 83, 87, 89,91,92,94,

95,

96, 98,

99,

119,

125,

157,

and

183

of the

Schedule,

all contested herein, are stayed consistent

with the APA, and DM0 requests that the Board order the Agency

to delete

Paragraphs 57,

58,

59,

60, 61, 62,

73, 74, 91, 92, 94,

95, 96,

98,

99,

125,

157,

and

183

from the Schedule and

all

references to these Paragraphs from the

permit, to revise Paragraphs

83, 87 and

119 to identify

the

specific unit(s) at the Vermilion

Station that the

requirement applies

to and to correct the

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errors contained

in Paragraphs

42

and 44

by duplicating the

language in the parallel provisions of

the Consent Decree.

(iv)

Recordkeeping of and Reporting

HAP Emissions

39.

The CAAPP permit

issued to the

Station requires DMG to keep records of

emissions of mercury, hydrogen

chloride, and

hydrogen

fluoride

—

all

HAPs

—

and to

report

those

emissions at Conditions 5.6.1(a) and

(b) (recordkeeping) and 5.7.2

(reporting).

The Agency has

not a provided a proper statutory or regulatory

basis

for these requirements other than the general

provisions of Sections

4(b) and 39,5(7)(a),

(bj, and (e) of the

Act.

Citations

merely to the

general provisions of the Act do

not create

an “applicable

requirement.”

40.

In fact, there

is no applicable requirement that allows the Agency

to

require this

recordkeeping and reporting.

There

are no regulations that limit emissions of HAPs from

the

Vermilion Power Station.

While USEPA

has recently promulgated the

Clean Air

Mercury Rule

(“CAMR”)

(70 Fed.Reg. 28605 (May

18, 2005)),

Illinois has not

yet developed

its corresponding

regulations.

The Agency correctly discussed this issue relative specifically to mercury

in the

Responsiveness

Summary by pointing out that it cannot add substantive requirements through a

CAAPP permit or through

its

oblique reference to the CAMR.

See

Responsiveness Summary

in

the Administrative

Record, p. 21.

However,

the Agency

was incorrect in

its discussion in the

Responsiveness Summary by

staling that

it

can rely

upon

Section 4(b)

as a basis for requiring

recordkeeping and reporting of mercury emissions through the

CAAPP permit.

The Agency has

confused its duty to

gather data pursuant to Section 4(b) and its authority to gapfill to assure

compliance with the permit with the limitation

on

its authority under Title V to include ~pJy

“applicable requirements”

in a Title V

permit.

See Appalachian Power.

Even by

including only

recordkccping and reporting of HAP emissions

in the permit, the Agency has exceeded its

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authority just as

seriously as ifit had included emissions limitations for lIAPs

in

the permit.

Section 4(b) does not provide the authority to impose this conditions in a CAAPP

permit.

41.

Further,

the

Agency’s own regulations, which are part of the approved program

or

SIP

for its Title V program,

preclude the Agency

from requiring

the recordkeeping and reporting

of HAP emissions

that it has included at

Conditions 5.6.1(a) and (b) and

5.7.2.

The Agency’s

Annual

Emissions Reporting

rules,

35

lll.Adm,Code Part

254, which Condition

5.7.2 specifically

addresses, state

as follows:

Applicable

Pollutants for Annual

Emissions Reporting

Each

Annual

Emissions

Report

shall

include

applicable

information

for

all

regulated

air

pollutants,

as

defined

in

Section

39.5

of

the

Act

1415

ILCS

5/39.5,

~

~ants:

b)

A hazardous

air pollutant

emitted

by

an emission

unit

that

is

not

subject

to

a

National

Emissions

Standard

for

Hazardous

Air

Pollutants

(NESHAP)

or

maximum

achievable

control

technology

(MACT).

For

purposes

of

this

subsection

(b),

emission

units

that

are

not required

to

control or

limit emissions but

are required

to monitor, keep

records,

or

undertake

other

specific

activities

are

considered sub~eetto such regulation or requirement.

35

lll.Adm.Code

§

254.120(b).

(Brackets in original; emphasis added.)

Power plants

are not

subject to any NESHAPs or MACT standards.

See

69 Fed.Reg.

15994 (March 29, 2005)

(USEPA withdraws its

listing of coal-fired power plants under Section

112(e) of the

Clean Air

Act).

The Agency has not cited any other applicable requirement that provides it with the

authority to require DM0

to

keep records of and report HAP

emissions.

‘therefore, pursuant to

the provisions of~254.120(b) of the Agency’s regulations, the Agency

has no regulatory basis

for requiring the reporting of J1APs emitted by coal-fired power plants.

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42.

For these reasons, Conditions

5.6.1 (a)

and

(b)

in

low

and Condition

5.7.2

as

it

relates to

reporting emissions of 1-lAPs

in the Annual

Emission Report, all contested herein, are

stayed consistent with the

APA, and 9MG requests

that the Board order the Agency to amend

the permit

to delete

such conditions.

(v)

Retention and Availability of Records

43.

Conditions

5.6.2(b) and

(e) switch the burden of copying records the

Agency

requests

from the

Agency. as

slated in Condition 5.6.2(a), to the permittee.

While DMG

generally does

not object to providing the

Agency records

reasonably requested and is reassured

by

the Agency’s statement

in the

Responsiveness Summary that its “on-site inspection of records

and written

or verbal

requests

for copies of records will generally occur at reasonahk-times and

be reasonable

in nature and scope” (Responsiveness Summary,

p.

18) (emphasis added), DM0

may not

be

able to print

and provide data within

the span of an

inspector’s visit where the

records

are electronic and include vast amounts of data.

Moreover, most of the electronic

records

are already available to the Agency through

its own or

USEPA’s databases, and where

this

is the

case, DM0 should not

he

required to again provide the data absent

its loss for some

unforeseen reason, and certainly should not to have to print out the information.

Further, DM0

is troubled by

the

qualifier

generally

that the Agency

included in

its

statement.

It implies that the

Agency may not always choose reasonable

times, nature, and scope of these requests.

44.

For these

reasons, Conditions

5.6.2(b) and (c),

all contested herein, are stayed

consistent with the APA, and DM0 requests

that the Board order the Agency to amend them in a

manner to correct the deficiencies outlined

above.

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(vi)

Duplicative Reporting

45.

Various provisions of the

permit impose obligations to submit information to the

Agency that DM0 already submits electronically to government agencies pursuant to certain

federal and state requirements.

Information submitted electronically to the USEPA,

for instance,

is generally available to the Agency through USEPA’s electronic databases.

The requirement to

submit information to the Agency that is already available

to the Agency electronically results in

duplicative obligations that are burdensome

and serve no apparent

purpose.

Therefore, the

requirement

is arbitrary

and capricious.

For these reasons, all conditions

that impose obligations

upon DM0 to submit information to the Agency that is available to the Agency without

such

submissions, are stayed consistent with the

A1’A, and DM0

requests that such conditions be

deleted from

the permit.

(vii)

Submission of Blank, Record Forms to the Agency

46.

DM0

is unsure

as to what the Agency expects with respect to Condition

5.6.2(d).

See

Condition 5.6.2(d).

On the one hand, this condition may require submission of the records

thatarerequiredby

Conditions

7.1.9-1. 7.1.9-2, 7.1.9-3, 7.1.9-4, 7.2.9, 7.3.9,7.4.9,7.5.9, 7.6.9

and 7.7.9.

On the

other hand, Condition

5.6.2(d), may require DM0 to submit blank copies of its

records, apparently

so that the

Agency can check them

for form

and type of content.

If this latter

interpretation

is correct, there is no

basis

in law for such a requirement

and it

must be deleted.

47.

Each company has the right and responsibility to develop and implement

internal

recordkeeping systems.

Even the most unsophisticated

company

has the right

to develop and

implement internal recordkeeping systems and bears the responsibility for any insufficiencies

it

makes

in doing

so.

Absent a statutory

grant or

the promulgation

of reporting formats

through

rulemaking,

the Agency

has

no

authority to oversee

the development of recordkeeping or

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reporting formats,

The Agency

has the

authority to require that certain information be rcporicd

but

cites

to no authority, because there is none,

to support this condition.

48.

Nor does

the Agency provide a purpose

for this condition

—

which serves as

an

excellent example of why a detailed statement-o1~hasis

document

should accompany

the CA,APP

permits, including the

drafts, as required by

Title

V.

One

can merely assume that the

Agency’s

purpose

for this condition is

to review records that permittees plan to keep in support of

the

various recordkeeping requirements

in the permit

in order to assure that they arc adequate.

1-lowever,

there is no regulatory

or statutory

basis

for the

Agency

to do this, and it

has cited none.

Moreover, ifthe Agency’s purpose

for requiring this submission is to determine the adequacy of

recordkeeping,

then without inherent knowledge of all of the details of any given operation,

it

will

be difficult for the Agency to determine the adequacy of recordkeeping for the

facility

through an off-site review.

lfthe

Agency

finds records that are submitted

during the prescribed

reporting periods inadequate, the

Agency has a remedy available to

it through the

law.

It can

enfhrce against

the company.

That

is the risk that the company bears.

49.

Further,

if the company

is concerned with the

adequacy of its planned

reeordkeeping. it can ask the

Agency to provide it

some counsel.

Providing such counsel or

assistance is

a statutory function of the Agency.

Even then, however, the Agency will qualify its

assistance

in order to

attempt to avoid reliance on the part of the permittee

should there be an

enforcement action brought.

An interpretation of this condition could be that by providing blank

recordkeeping forms to the Agency, absent

a communication from the

Agency that they are

inadequate,

enforcement against

the permittee for inadequate reeordkeeping

is barred,

so long as

the

forms

are

tilled out, because

they are covered by the permit shield.

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50.

AdditionalI~’,the Agency

has violated DMG’s due process rights under the

Constitution

by requiring submission of these documents

before DM0 had the

opportunity to

exercise

its right

to appeal the condition,

as granted by

the

Act at Section 40.2.

The Act allows

permittees

35 days

in which to

appeal conditions of the permit to

which it

objects.

The

Agency’s

requirement

at Condition 5.6.2(d) that DM0 submit blank forms within

30

days of issuance

of

the

permit significantly undermines DM0’s

right to appeal

--and the effectiveness of that

right

—

or forces DM0 to violate the terms and conditions of the permit to hilly preserve

its rights.

Although the condition

is stayed, because the appeal may not

be

filed until

35

days

after

issuance, there could at least

lie a question

as to whether DM0

was in violation from

the time the

report was

due until

the

appeal was

filed.

DM0

submits

that the

stay relates back to the

date of

issuance.

Nevertheless, it is improper to even create

this uncertainty.

‘Ihis denies DM0

due

process and so is

unconstitutional, unlawful, and arbitrary and capricious.

51.

For these reasons, Condition

5.6.2(d), contested herein, is stayed consistent

with

the APA, and DM0 requests that the Board order the Agency to delete

it

from the permit.

In the

alternative, DM0 requests that the

Board interpret this condition such that ifthe Agency fails to

communicate any inadequacies it

finds in blank recordkeeping forms submitted to

it,

enforcement against DM0 for inadequate records

is

barred, so long

as those records were

completed,

as

part

of the

(viii)

Reporting Concerning Certain

Requirement of the Consent Decree

52.

Conditions 5.7.3

and

5.7.4

purport to

characterize

and impose

reporting

requirements associated with the Consent Decree.

These

conditions impose

requirements that are

not required by the Consent Decree or

any

other

applicable

requirement, and the

presence of

these conditions in

addition to

the related provisions

ofthe

Schedule and Consent Decree creates

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ambiguity and unnecessary duplication

of

requirements.

For the

reasons stated earlier, the

Schedule and

Consent Decree requirements are separately enforceable.

Conditions

5.7.3 and

5.7.4

are arbitrary and capricious and unauthorized by

law’.

For these reasons, Conditions 5.7.3

and 5.7.4,

contested herein. are stayed consistent

with the APA, and DM0

requests that the

Board order the

Agency

to delete

these conditions.

C,

NOx

SIP Call

(Section 6.3)

53.

Condition 6.1.4(a)

says, “Beginning in

2004, by

November 30 of each year..,.”

While Ihis

is a true

statement,

i.e.,

the NOx

trading program

in

Illinois commenced

in 2004.

it

is

inappropriate

for the Agency

to

include in the permit a condition with

a

retroactive effect.

By

including this past

date

in an enforceable pennit condition, the Agency

has exposed DM0 to

potential

enforcement under this permit for acts

or omissions that occurred prior to the

effectiveness

of this permit.

It

is unlawful

for the Agency

to require

retroactive

compliance with

past

requirements

in a new permit condition.

Lake EnvtL,

Inc.

v.

The State of Illinois,

No.

98-

CC-5179,

2001

WL

34677731, at ~8 (III. Ct.

Cl. May

29, 2001)

(stating “retroactive applications

are disfavored in the law, and are not ordinarily allowed in the absence of language explicitly

so

providing.

‘he

authoring agency of administrative regulations

is no

less subject to these settled

principles of statutory construction than any other arm of government.”).

This language should

be changed to refer to the first ozone season occurring upon effectiveness of the permit, which,

for example, if the permit appeal

is resolved before

September 30, 2006, would be the

2006

ozone

season.

Rather than including a specific date, DM0

suggests that the

condition merely

refer to the

first ozone season during which the permit is effective.

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54.

For these

reasons, Condition 6.1.4(a), contested herein,

is stayed consistent with

the

APA, and DM0 requests that the Board order the Agency

to amend the language to avoid

retroactive compliance with past requirements.

D.

Boilers

(Sections 7.1

and

7.7)

(1)

Opacity

as a

Surrogate

for

PM

55.

Historically, power plants

and other types of industrial

thciiilies have

demonstrated cotnpliance with emissions

limitations for PM through periodic

stack tests and

consistent application of good operating practices.

Prior to

the development of the CAAPP

permits, opacity

was primarily a qualitative indicator of the possible need

for further

investigation of operating conditions or even for the need of new stack testing.

However, the

Agency has developed and imposed

in Condition

7.1 .9-3(a)(iii), and related conditions,

a

requirement that treats opacity as a quantitative surrogate

hr

indicating exceedances of the PM

emissions

limitation.

For the first time in the August 2005 proposed permit,

the Agency required

Petitionerto

identify the opacity measured at the

95th

percentile confidence interval of the

measurement of compliant PM emissions during the last

and other historical stack tests as

the

upper bound opacity

level thai triggers reporting of whether there

~

have

been an exceedance

of the PM limit without regard for the

realistic potential for a PM exceedance.

These reporting

requirements are quite onerous, particularly for the units that tested

at the lowest levels of PM

and opacity.

Inclusion of these conditions exceeds the scope of the Agency’s authority to gapfill,

and

so is arbitrary and capricious.

Condition

7.1 .9-3(a)(iii), and related conditions, must be

stricken from the permit.

56.

The provisions requiring

the

use of opacity

as effectively a surrogate for PM are

found in Conditions 7.1 .9-3(a)(iii),

linked to

Conditions

7.1.4(b) and 7.1.6-I (b), which contains

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the emissions

limitation for PM;

7.1 .9—3(a)(iv), also

linked to Conditions

7.1.4-1(b) and 7.1.6-

1(b); and other related conditions, including 7.1.10-1(a) and its

subparts: 7.1.I0-2(a)(i)(E).

linked

to Conditions

7.1.9-3(a)(iv) and 7.1.9-3(a)(iii); 7.1.10-2(d)

and its

subparts;

7.1.lO-3(aXii); and

7.1.12(b),

relying on

continuous opacity monitoring pursuant

to Condition 7.1.8(a), PM testing

to

determine the upper bound of opacity,

and

the rccordkeeping conditions described

above to

demonstrate compliance with the

PM emissions limitation.

57.

No one can

provide a reliable, exact

PM concentration

level anywhere in the

United States today

outside of stack

testing,

Obviously, it

is impossible to continuously test

a

stack to determine a continuous

level

of PM

emissions, and

it would be unreasonable for the

Agency

or anyone else

to expect such.

Pursuant to

the Consent

Decree settling USEPA’s

enforcement action against

DM0 concerning the Vermilion

Station, DM0 will test continuous

PM monitoring devices.

Consent Decree, Paragraph 91.

The Consent Decree does

not require

the use of these PM CEMS to determine current PM

emissions levels for compliance purposes.

In

fact,

the

Consent Decree specifically prescribes

annual stack testing

as the method

of

determining

the

concentration of PM in Paragraph 42.

I’M CEMS are not yet developed to

the

point of refinement where

they should

be considered credible

evidence of PM emissions levels;

DM0

is

not aware of any case in which government or citizens suing under Section

304 of the

Clean Air Act have even relied

upon PM CEMS as

the basis of a case for PM violations.

As a

result, sources must rely

upon the continuity or consistency of conditions that occurred

during a

successful stack

test to provide

reliable indications of PM emissions levels.

58.

Historically,

opacity has never been

used

as a reliable, quantitative surrogate for

PM emissions

Levels.

The

Agency itself acknowledged that

opacity is not a reliable indicator of

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PM

concentrations.

(See

Responsiveness Summary. pp.

15-16, 42-44)?

Increasing opacity

may

indicate that PM emissions are increasing,

but this

is not always the case nor is

a given opacity

an

indicator of a given

PM level at any

given time,

let alone at different times,

Relying on

stack

testing

is the

best and most

appropriate approach to assuring compliance with PM emissions

limitations.

59.

Despite the Agency’s implications to the contrary in the

Responsiveness

Summary

(see

Responsiveness Summary, pp.

42-44), the permit

does make opacity a surrogate

fbr PM compliance.

When the Agency requires

even estimates of PM

levels

or guesses

as to

whether there

is an exceedance of PM based

upon opacity, opacity has been

quantitatively tied to

PM compliance.

Further, the opacity level triggers reporting that the

opacity/PM surrogate level

has been exceeded and so indicates that there ~~gyhave been

an exceedance ofthe PM

level

regardless

of any evidence to the

contrary.

For example, if the

opacity/PM

surrogate level of,

say,

15

is exceeded, this must be reported

despite the fact that all

fields in the electrostatic

precipitator were on

and operating, stack testing indicated that the PM emissions level at the

95U~

percentile confidence

interval is 0.04 lhlmmBtulhr, and the

likelihood that there was

an

exceedance of the PM emissions limitation of 0.1

lb/mmBtu/hr is extremely remote.

There

is no

legitimate

purpose of such reporting.

It does

not assure compliance with

the PM limit and so

inclusion of these conditions exceeds the Agency’s gapfilling authority and is, thus, unlawful and

arbitrary and capricious.

Moreover, this unnecessary reporting requirement is a new substantive

requirement, according to

Appalachian Power,

not

allowed under

Title V.

“S

jetting a specific

level

of opacity that

is deemed

equivalent to the applicable

PM

emission

limit

-

.

-

is not

possible

on

a variety of levels

.

.

-

It would

also

be

inevitable

that such

an action would be

flawed

as the

operation of a boiler

may change

over time

and

the

coal

supply will

also

change, affecting

the nature

and

quanlity

ofthe

ash

loading

to

the Es?.

These types

of changes cannot be

prohibited,

as they

are inherent

in the

routine operation of coal-fired power platts.

Ilowever,

such changes could invalidate any pre-established

opacity value.”

Responsiveness Summary,

p.’44.

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60.

Contrary to the

At~ency’s

assertion

in the

Responsiveness

Summary that opacity

provides a “robust means

to distinguish compliance operation of a coal-fired boiler and its

ESP

from

impaired operation” (Responsiveness

Summary, p. 43), relying upon

opacity as a surrogate

fhr PM emissions levels has the result of penalizing

the best-operating units.

That

is,

the

units

for which the stack testing resulted

in very low opacity and very

low PM

emissions levels are the

units for which this additional reporting will

be most

frequently triggered.

For example,

ifstack

testing resulted

in PM emissions

of 0.02 Ih/mml3tu and the

opacity during the test

at the 9S~~

percentile confidence

interval

was

2,

DMG would

be required to submit reports stating that the

unit ~gy

have exceeded the

PM limit every time

opacity exceeds

2.

Clearly, this condition

will result in overly

burdensome reporting that serves no

purpose.

As such,

it exceeds the

Agency’s authority to

gapfill,

is unlawful,

and is arbitrary and capricious.

61.

Further, this condition effectively creates a false low opacity limitation.

In order

to avoid the

implication that there may have been an

exceedance of the

PM limit, the

opacity

limit becomes that level

thai

is the

upper bound at the

95th

percentile confidence interval in the

PM testing.

By including these conditions, the

Agency has created a new,

substantive

requirement without having complied with proper rulemaking procedures.

This is unlawful

and

beyond the scope of the Agency’s authority under Section 39.5 of the Act and Title V of the

Clean

Air Act.

It also violates the provisions of Title VII of the Act.

See Appalachian Power.

62.

Periodic stack testing according to paragraphs 89

and 119 of the Consent Decree

is sufficient to assure compliance with the applicable

PM limit and satisfy the periodic

monitoring requirements of Section 39.5(7)(d)(ii) of the

Act according to the

Appalachian Power

court.

In fact. “periodic

stack testing”

is the Agency’s

own phrase

in Condition 7.l.7(a)(iii) and

is

consistent with the findings

of

Appalachian Power.

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63.

Conditions 7.l.lO-2(d)(v)(C) and (Win

particular are repetitious

ofCondition

7.1 .l0-2(d)(iv).

Both require descriptions of the same

incident and prognostications as

to how

the incidents can

be prevented in the future.

‘lo the extent either condition is appropriate,

Condition

7.1 .l0-2(d)(iv), is sufficient to address the Agency’s

concern, although

DM6 also

objects to Condition

7.1 .I0-2(d)(iv) to the extent that

it requires reporting related to the opacity

surrogate.

64.

In

conjunction with its attempt to relate opacity

to PM, the

Agency requires in

Condition

7.1 .10-2(d)(v)(A) and (B) detailed information regarding recurring and new causes of

opacity exceedances

in a calendar quarter.

The

requirements are

overly burdensome and

the

Agency lacks authority to impose such requirements.

65.

As with Condition 5.6.2(d) discussed above, Condition

7. 1.9-3(a)(iii) denies

DMG due process.

Condition 7.1.9-3(a)(iii) requires that the

“records

.

.

.

that identify

the

upper bound of the

95

confidence

interval

(using

a

normal

distribution

and

1

minute

averages)

for

opacity

measurements

.

.

.

,

considering

an

hour

of

operation,

within

which

compliance

with

~thc I~Mlimit

is

assured,

with

supporting

explanation

and documentation.

.

.

.

shall he

submitted

to the

Illinois EPA in accordance with

Condition 5.6.2(d).”

66.

Obviously, if Condition 5.6.2(d) denies DMG due process, Condition

7.1.9-

3(a)(iii) does

as well for the same reasons.

DM6 was not

granted the opportunity to appeal the

condition

before

it was

required to submit to the Agency information that DM6 believes

is

not

useful or reliable.

DM6

is particularly loathe to provide the

Agency with this information

because

it believes that the information will be misconstrued and misused.

67.

Finally, Condition

7.1.1 0-2(d)(vi) requires

DMG to

submit a glossary of

“common technical terms used

by the Permittee”

as part of its reporting of opacity/PM

execedance

events.

If the terms are

“common,” they do

not require

definition,

Moreover, this

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requirement

does

not appear anywhere

else

in the pcrmit.

if “common technical

terms” do

not

require definition in other contexts in this permit, then surely they do

not require definition

in

this context.

This

requirement should

be

deleted from

the permit.

68.

For these reasons, the

conditions contested in this section, including Conditions

7.1 .9-3(a)(iii), 7.1 ,9—3(a)(iv),

7.1.10—1(a),

7,1. 10-2(a)( )(F), 7.1.10—2(d),

7.1.1 0-2(d)(v);

7.1.10-

2(d)(v)(A),

7.1.1 0—2(d)(v)(B),

7.1. 10-2(d)(v)(C). 7.1. lO—2(d)(v)(D),

7.1.1 0-2(d)(vi).

7.1.10—

3(a)(ii), and

7.1.12(b),

and any other related conditions, are

stayed consistent

with the APA, and

DM6

requests

that the Board order the Agency

to

delete these conditions.

(ii)

Reporting

the Magnitude

of PM Emissions

69.

The

Agency requires DMG

to determine and

report the

magnitude of PM

emissions during

startup and operation during malfunction and breakdown.

See

Conditions

7.1 .9—4~a)(i),7.1 .9—4(a)(ii)(C)(5),

7.1.9-4(h)(ii)(E)(3), and 7.1.1 0-2(d)(iv)(A)(3).

Compliance

with these conditions is not possible

and, therefore, the

inclusion of these conditions

in the

permit is arbitrary and capricious.

DM6 does

not have a means for accurately measuring the

magnitude of PM emissions

at any time other than during stack testing

—

not even using the

opacity surrogate.

‘there

is not a certified, credible, reliable alternative to

stack testing to

measure PM emissions.

Although a PM

CEMS may be installed at the Station under

the Consent

Decree, any

such CEMS has not been certified (and might

not

be despite DMG’s good

faith

efforts) and thus the permit should not require

or depend on the use of such

a CEMS to measure

PM emissions.

70.

Additionally, Condition 7.l.10-2(d)(iv)(A)(5) requires DM6 to identify

“the

means

by

which the exceedance of

the PM emissions limit

was

indicated

or identified, in

addition to

continuous monitoring.”

This inaccurately implies

that a PM CEMS

is

installed and

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operating at Vermilion

or that the

installation and operation of a PM Cl/MS

at a Vermilion unit

will occur.

A PM CEMS may not be installed at Vermilion,

Even if a PM CEMS is installed at

a Vermilion

unit,

any such

CEMS

is not currently

an authorized

or

required basis to determine

compliance, as described

more fully elsewhere in this petition.

DM6 believes

that this might

also be construed

to mean that

it must provide information relative to some

means, such

as

opacity

-.~

which, as

discussed

in

detail above,

DMG believes

is an

inappropriate and inaccurate

basis for

determining whether there are

exceedanees of the

PM

limit, let alone the magnitude of

any such exeeedanee

—

that DM0

relied

upon

to

determine any exeecdance

of the PM

limit.

Besides stack testing or perhaps total

shutdown of the ESP, there

are none.

This is

a nonsensical

requirement.

71.

For these reasons, Conditions 7.1.9-4(a)(i), 7.1.9-4(a)(ii)(C)(5), 7,1.9-

4(b)(ii)(E)(3), and 7.1.10-2(d)(iv), specifically 7.1i0-2(d)(iv)(A)(3) and (5), all contested herein,

are

stayed consistent

with

the

APA, and DM6 requests

that

the Board order the Agency

to delete

these conditions

from the permit.

(iii)

PM and CO Testing (Condition

7.1.7(a))

72.

As noted in

Condition 71.7(a)(i),

the Consent

Decree

(and related Schedule)

impose annual and other periodic PM stack testing requirements.

See Schedule, Paragraphs

89

and

119.

Because the Schedule imposes annual (subject to frequency reduction ifcertain

conditions are satisfied) and other periodic PM stack testing requirements, and compliance with

the Schedule

is mandated by Condition

5.4(a),

as discussed above,

there is no need to

impose

alternative or additional PM stack testing requirements in Condition 7.1.7(a).

The stack

testing

required by

the

Consent Decree

is

more than sufficient to satisfy any applicable monitoring

requirement, and any additional, alternative or inconsistent

stack test

requirement

is unauthorized

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by

law and arbitrary

and capricious.

Further,

as discussed

earlier

in this petition,

the addition of

Conditions

7.1 .7(a)(i), (iii) and (v), which relèr to

and characterize requirements

set forth

independently

in

the Schedule, creates ambiguity, additional

and duplicative requirements and

inconsistencies.

For these reasons, Conditions

7.1 .7(a)(i), (ii). (iii), (iv). (v)

and (vii),

to the

extent the

conditions relate to PM

testing,

and

any

related conditions, are

contested

herein and

stayed

consistent

with the

APA, and DM6 requests that the

Board order the Agency to delete

Condition

7.1 .7(a)(i), (ii),

(iii) and (v).

to delete the PM

testing requirements

from Conditions

7.1 .7(a)(vi) and (vii) and to delete

any other conditions that relate to or reference the PM testing

set

forth in these conditions.

73.

In addition,

Condition 7.l.7(a)(vi)(A)

provides that if the “standard

fuel” is

less

than 97

of the fuel supply in a quarter, additional

testing is required.

Condition 7.1.7(a)(vi)(B)

provides that ‘such measurements” (presumably those tests required

by Condition

7.1 .7(a)(vi)(A)), shall be made “while

firing the boiler

with at least

1.25 times the

greatest

percentage of other materials in the calendar quarter that triggered the

testing.”

This may not,

however,

be

possible, and imposing a condition that may

not be achievable

technically and

practically

is unauthorized by law and arbitrary and capricious.

74.

Forthese

reasons, Conditions 7.l.7(a)(vi) and 7.l.7(a)(vi)(A) and (B), contested

herein, are stayed consistent with the APA, and DM6 requests that the

Board order the

Agency

to revise these conditions to address the deficiencies identified above.

75.

DM6 interprets the language in Conditions

7.I.7(a)(i) and (a)(iv)

to

mean that

testing

that occurs after January

1,2005, and before

December31, 2005

satisfies the initial

testing requirements included in the permit for CO

(as set forth above, DM6 believes

that the

conditions in

7.l.7(a)(i), (ii), (iii),

(v), (vi) and (vii) relating

to PM should be stricken).

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I lowever,

the language

is not clear, in part because the

CO testing timing is tied to the PM stack

testing timing, which in turn

is tied to the Consent Decree.

Even ifthese CO

testing conditions

were appropriately included in the permit, which DMG does

not concede, the language of

Conditions

7.1.7(a) should be revised to make clear that the initial

CO test will

be required only

at the time when the

initial PM stack test

is required under

the

Consent Decree.

For these

reasons, Condition

7.1 .7(a)(i) and (iv),

contested herein, are stayed consistent with the

APA, and

DM0 requests that the

Board order the Agency

to

revise these conditions to address these

deficiencies.

(iv)

Other PM Testing Matters

76.

The Agency

has included a requirement in the permit at Conditions

7.1.7(b)(iii)

and, possibly 7.7.7-l(b)(ii) (this Condition contains “including” ~anguagcregarding test

methods

that

is unclear in light of 7.1.7(b)(iii)’s

indication that Method 202 testing

is

an appropriate

reference method; accordingly, this petition will

treat 7.7.7-1(b)(ii) as

containing a condensible

testing requirement without

conceding that

it does) that DM0

perform testing for PMIO

eondensibles.6

First, this requirement is beyond the scope

of the Agency’s

authority to include in

a CAAPP permit,

as such testing is not an “applicable requirement,” as discussed

in detail below.

77.

With respect to the inclusion of the requirement

for Method 202 testing at

Conditions 7.1.7(b)(iii) and 7.7.7-1(b)(ii), the Agency has exceeded its authority and the

requirements should be removed from the permit.

The inclusion of Method 202 testing

requirements is inappropriate because there is no regulatory requirement that applies PMIO

limitations to the Vermilion Power Station.

In response to comments on

this point, the Agency

6

Condensible

is the

Board’s

spelling

in the

regulations and

in

scientific publications,

thus our spelling of it here

despite the

Agency’s chosen

spelling

in the

permit,

which

is the

preferred

spelling in the Webster’s dictionary.

See

35

Ill.Adm.Code

~212.108,

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stated

in the

Responsiveness

Summary at page

18. “The requirement

for using both Methods

5

and 202

is authorized

by Section 4(b)

of the Environmental

Protection Act.”

DM6

does not

question the Agency’s

authority to gather information,

Section 4(b) of the Act says,

The

Agency

shall

have

the

duty

to

collect

and

disseminate

such

information,

acquire

such

technical

data,

and

conduct

such

experiments

as

may

be

required

to

carry

out

the

purposes

of this

Act,

including

ascertainment

of

the

quantity

and

nature

of

discharges

from any contaminant source

and data

on

those

sources,

and

to

operate

and

arrange

for

the

operation

of

devices

for

the

monitoring of environmental quality.

415

ILCS

5/4(b).

However,

this authority does not

make testing for PMIO condcnsibles an

“applicable

requirement” under Title V.

As discussed above, an “applicable requirement”

is one

applicable to the

permittee pursuant to a federal regulation or a SiP.

78.

Further, just because

Method 202 is one of USEPA’s reference methods does not

make it

an “applicable requirement” pursuant

to Title V, as

the Agency suggests in the

Responsiveness Summary.

The

structure of the Board’s PM regulations establish the applicable

requirements

foT

the

Vermilion Power Station.

The Vermilion Power Station

is subject to the

requirements of35

lll.Adm.Code 212.Subpart E, Particulate Matter Emissions from Fuel

Combustion Emission Units,

it

is

not and never has been

located in a PMIO nonattainment area.7

The Board’s PM regulations are structured such that particular PMIO requirements apply to

identified

sources located in

the PMIO nonattainment areas.8

No

such requirements apply now

or have ever applied to the

Vermilion Power Station.

79.

The

measurement method for PM, referencing only Method

5 or derivatives of

Method 5,is at 35

lII.Adm.Code

§

212.110.

This section of the

Board’s rules applies to the

In

fact, there are

no

more

PM 10

nonattainment

areas

in

the state.

See

70 Fed,Reg.

5554

and 55545

(September

22, 2005),

redesignating to

attainment the

McCook and Lake Calumet nonattainrnent areas,

respectively.

Presumably, these

sources will

remain subject

to those

requirements as part of Illinois’

maintenance

plan.

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Vermilion Power Station.

The

measurement method for PM 10, on

the other hand,

is found at 35

lll.Adm.Code

§

212.108,

Measurement Methods

for PM-lU Emissions and Condensible

PM-lU

Emissions.

This section references both Methods

5

and

202, among others.

Not

subject

to

PM1O limitations, the Vermilion Power Station

is not subject to

§

212.108,

contrary to the

Agency’s attempt to expand its

applicability in the

Responsiveness Summary by stating,

“Significantly, the use of Reference Method

202 is

not limited

by geographic

area or

regulatory

applicability.”

Responsiveness Summary, p.

18.

lhis is certainly a true statement if one is

performing a test of condensibles.

However, this statement does

not expand

the requirements of

§

212.110 to include PM 10 condensible testing when the limitations applicable

to

the source

pursuant to 212.Subpart E are

for only PM, not PMIO.

Therefore, there is

no

basis for the

Agency to require

in the CAAPP

permit, that the Vermilion Power Station be

tested pursuant to

Method 202.

80.

The Agency even

concedes

in the Responsiveness

Summary that Method 202 is

not

an applicable requirement:

The

inclusion of this requirement

in

these

CAAPP

permits, which

relates

to

full

and

complete

quantification

of emissions,

does

not

alter

the

test

measurements

that

are

applicable

for

determining

compliance

with

PM

emissions

standards

and

limitations,

which

generally

do

not

include

condensable

sic

PM

emissions.

In

addition, since

condensable

sic

PM

emissions

are

not

subject

to

emission standards.

.

Responsiveness Summary, p.

18.

(Emphasis added.)

Further,

the Agency says, “Regulatorily,

only filterable191 PM emissions need to be measured.”

Responsiveness Summary, p.

18.

The

Agency attempts

to justify inclusion of the requirement for testing eondensibles

by stating that

the data are needed to “assist in conducting assessments of the air quality impacts of power

I.e., non-gaseous PM;

condensibles are gaseous.

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plants, including

the

Illinois EPA’s

development ofan attainment strategy

for PM2.5” or

by

stating that “the use of Reference Method 202 is not limited

by geographic

area or

regulatory

applicability.”

Responsiveness

Summary,

p.

18.

Under the Board’s

rules,

it

is limited to testing

for PM, and so, at least

in

Illinois, its “regulatory applicability” is,

indeed,

limited.

These

attempted justifications do

not convert testing

for condensibles into

an applicable requirement.

SI.

While the Agency has

a duty under Section 4(b) to gather data,

it must be done in

compliance with

Section

4(b).

Section

4(b),

however, does

not create

or

authorize the

creation of

permit conditions,

The

Board’s rules

serve

as

the basis

for permit conditions.

Iherefore, DM0

does dispute that requiring such

testing in

the CAAPP

permit is appropriate.

In fact,

it

is

definitely

not appropriate.

It is unlawful

and exceeds the

Agency’s authority.

82.

For these

reasons, Conditions 7.1.7(b),

and the inclusion of Method

202 in

Conditions

7.1 .7(b)(iii) and 7.7.7-1(h) (to the extent this condition includes Method 202), all

contested herein, are stayed

consistent with the

APA, and DM0 requests

that the Board order the

Agency to delete the requirement for Method 202 testing from the permit.

(v)

Measuring CO Concentrations

83.

The CAAPP permit issued to the

Vermilion Power Station requires DM0

to

conduct, as

a work practice,

semi-annual or quarterly “combustion evaluations” that consist of

“diagnostic measurements of

the concentration of CO

in the

flue gas.”

See

Conditions 7.1.6-

2(a), semi-annual and 7.7.6(a), quarterly.

See also

Conditions 7.I.9-1(fl(i), 7.l.lO-l(a)(v)

(related reporting requirements), and 7,1.12(d),

7.7.9(a)(iii) and 7.7.12(d) (related recordkeeping

and compliance procedure requirements) and any conditions imposing related reporting

reqturements.

Including these provisions

in the permit

is not necessary to assure compliance

with the

underlying standard,

is not required by

the

Board’s regulations, and, therefore, exceeds

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the

Agency’s authority to gapfill.

Maintaining compliance with the CO

limitation has

historically been

a work practice, thus its inclusion

in the work practice condition of the

permit.

Sophisticated control

systems are programmed to maintain boilers in an optimal

operating mode,

which serves to minimize CO emissions.

One can

speculate that because

it

is

in

DMO’s best

interests to operate its boilers optimally and because

ambient CO levels are

so

low,

10

compliance

with the CO

limitation has been accomplished through combustion optimization techniques

historically at power plants.

There is

no reason to change this practice at this

point.

Ambient air

quality is not threatened,

and emissions of CO at the

Station

are significantly below the standard

of 200 ppm.

84.

Under these circumstances, requiring Stations to purchase and install equipment

to monitor and record emissions ofCO

is overly

burdensome and, therefore,

arbitrary and

capricious.

In order to comply with the “work practice”1

I

of performing “diagnostic testing” that

yields a concentration of CO,

DM0 must purchase and install or operate

some sort of monitoring

devices with no environmental purpose

served.

85.

Furthermore, the Agency has failed to provide

any guidance as to how to perform

diagnostic measurements of the concentration of

CO in the flue

gas.

It is DMG’s understanding

that a sample can

be extracted from any point in the furnace or stack using a probe.

‘I’his

sample

can then be preconditioned (removal of water or particles, dilution with air) and analyzed.

The

way in which the sample is preconditioned and analyzed, however, varies.

Given the

lack of

‘°

The highest one-hour ambient measure ofCO

in

the state

in

2003 was

in

Peoria:

5.3

ppm; the highest 8-hour

ambient

measure

in

the

state

was

in

Maywood:

3.5

ppm.

Illinois Environmental Protection Agency,

Illinois

AnnualAir

Qua/fly Report 2003,

Table 87, p51.

The one-hour

standard is

35

ppm, and

the

8-hour ambient

standard

is 9

ppm.

35

lll.Adni.Code

§

243.123.

Note:

The

Illinois AnnualAir

Qualify

Report 2003

is the latest

available data on

Illinois EPA’s

website atwww.ep~state.iIus

-*

Air

4

Air Quality

Information

9

Annual Air

Quality

Report 9

2003

Annual

Report.

The 2004

report

is

not yet available.

DM0 questions how

the requirement

that the

Agency

has

included

in

Conditions 7.1.6-2(a) and 7.7.6(a)

is

classified

as a

“work practice”

To derive

a concentration

of CO

emissions,

0MG

will

have to engage

in

monitoring

or testing

—

far more than

the

work practice of combustion optimization

that

has been

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iwiclance

and the variability

in the

way the

concentration olCO

in the flue

gas can

be

measured,

the data generated is

not sufficient to assure compliance with the CO

limit and is, therefhre,

arbitrary and capricious.

Stack testing,

on

the

other hand, does yield data sufficient to assure

compliance with the

CO

limit.

86.

In addition,

the permit requires at Conditions

7.1 .9-4(a)(i). 7.1 .9-4(a)(ii)(C)(5),

7.1 .9-4(h)(ii)(E)(3).12 7.7.9(d)(ii)(C)(3),

and 7.7.9(e)(ii)(D)(

),

that DM0 provide estimates of

the magnitude

of CO emitted during

startup and operation during malfunction

and

breakdown.

One monitoring device that DM0 could utilize for

the semi-annual and quarterly diagnostic

evaluations

required by Conditions

7.1.6-2(a) and 7.7.6(a), respectively,

is a portable

CO

monitor.

So far

as Petitioner knows, portable

CO monitors

are

not equipped with continuous

readout recordings.

Rather,

they must be manually read.

What the Agency

is effectively

requiring through these recordkeeping provisions is that

someone continually read portable

CO

monitors,

when used

for compliance, during startup, and during malfunctions and breakdowi~s,

which are by their nature not predictable.

In

the first case (startup), the

requirement is

unreasonable

and overly burdensome and perhaps dangerous in some weather conditions; in the

second case (malfunction and breakdown), in addition to

the same problems that are

applicable

during startup,

it may be

impossible for DMG to comply with the

condition.

87.

The requirement to perform diagnostic measurements of the concentration of CO

in the

flue

gas

is arbitrary and capricious because the Agency has failed to provide any guidance

as to how to perform the

diagnostic measurements-

DM0

can only speculate as to how to

develop and implement a formula

and protocol

for performing diagnostic measurements of the

concentration ofCO

in the

flue gas in the manner specified in Condition 7.1.6-2(a).

~Corresponding

conditions

appear

to

include

7.1.10-I

(a)(v) (reporting)

and

7.1.12(d)

(compliance

procedures).

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88.

USEPA has not required similar conditions

in the

permits

issued to other power

plants

in Region 5.

Therefore, returning

to

the work practice of good combustion

optimization to

maintain low levels of CO emissions

is approvable by USEPA

and is appropriate for CO in the

permit

issued

to the Station.

89.

For these reasons,

Conditions 7.1,6-2(a),

7,1.9-IWO),

7.1 .9-4(a)(i),

7.1,9-

4(a)(ii)~)(5),7.1 ,9-4(b)(ii)(E)(

),

,

7.7.6(a). 7.7.9(a)(iii), 7.7,9(d)(ii)(C)(3). Conditions

7.1.12(d) and 7.7.12(d) to the

extent the Conditions

require the quarterly diagnostic

ineasuremenls and estimates of CO

emissions during starttip and malfunctionlbreakdown, and

any other related conditions,

all

contested herein,

are stayed consistent with the APA. and DM0

requests that the Board order the Agency

to amend Condition 7.1.6-2(a)

and these other

conditions, as appropriate, to reflect a requirement

for work practices optimizing boiler

operation, to delete the

requirement for estimating the magnitude of CO emitted during startup

and mallunction and breakdown, and to amend the corresponding recordkeeping, reporting, and

compliance procedures accordingly,

(vi)

Reporting Requirements Under Condition

7,1.101(a) and Related Conditions

90.

Condition

7.1.10-1(a)

(including

all

subparts) requires “prompt reporting” with

respect to certain events

identified in this condition.

This condition, in turn, cues to many other

conditions,

and many other conditions referto this Condition

7.1 .10-1(a).

Based upon

its review’

of the parallel provision in the four Title

V

permits issued for its four other generating stations,

which

are also being appealed contemporaneously herewith, Condition

7.1 .10-1(a)

and related

conditions differ substantially among the five permits.

91.

The

Agency has failed to provide any support for

or explanation concerning these

substantial

differences.

The differences, if the conditions are

sustained,

would create

confusion

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and ambiguity,

and would increase

the cost

and elton necessary to comply with the permits.

There

is no

legitimate reason for these differences, which are arbitrary and capricious.

92,

For these reasons,

Condition 7.1.10-1(a) and related conditions (including

condItions that reference Condition 7.1.10-1(a)), are

contested herein and stayed consistent with

the

APA.

DM0

requests that the Board order

the

Agency to revise

such conditions to correct the

deficiencies set

forth above,

including,

as appropriate,

by

making the parallel provisions among

the

DM0

Title

V

permits consistent.

(vii)

Applicability

of 35 Lll.Adm.Code 217.Subpart V

93.

The Agency has included the

word

each

in Conditions 7.1.4(f):

“The

affected

boilers

are each

subject to the following

requirements

(Emphasis added.)

Because of

the

structure

and purpose of 35

lll.Adm.Code 2l7.Subpart

V,

which

is the requirement that the

NOx

emissions rate from certain coal-fired

power plants

during the

ozone season average

no more

than

0.25 lb/mmBtu across the

state, DM0 submits

that the use of the word

each

in this sentence

is misplaced and

confusing, given the option available to the

Vermilion Power

Station

to average

emissions

among affected units in infinite

combinations.

94.

For these reasons, Conditions 7,1.4(1), and 7.1 .4(f)(i)(A),

all contested herein,

are

stayed

consistent with the

APA, and

DMG requests that the Board order the

Agency to

delete

the word

each

from the sentence quoted above in Condition 7.1.4(f) and to insert the

word

each

in Condition 7.l.4W(i)(A) if the Board determines that its inclusion

is necessary at all, as follows

for Condition

7.1 .4ffl(i)(A):

“The emissions of NOx from the affected boiler

(viii)

Startup

Provisions

95.

As is allowed by Illinois’

approved Title V program, CAAPP permits provide an

affirmative defense against enforcement actions brought against a permittee for emissions

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exceeding an emissions

limitation during

startup.

In

the

issued version olihe

permit,

the

Agency

imposed

additional recordkeeping obligations

for Boilers

I

and 2 if the startup period

exceeds

four hours under Condition

7.1.9-4(a)(ii)(C).13

Similarly,

Condition 7.7.9(d)(ii)(C) imposed

additional recordkeeping for the

heating boiler if the

startup period exceeds twelve minutes,

The

Agency provided

no support for its

recordkeeping requirements, and no explanation for the

period of time that

would trigger the additional recordkeeping obligation.

Moreover, the

timeframes

are so short that

it

is

illogical

to include

the provision for “additional” recordkecping,

as

the rccordkeeping will be

required for virtually every startup.

96.

The

provisions in the Board’s

rules allowing for operation of a CAAPP

source

during startup

are located

at 35

Ill.Adm.Code 201

Subpart

1.

‘l’hcse provisions,

at

§

201.265

refer back to

§

201.149 with respect to the affinnative defense available,

The rules nowhere

limit the length of time allowed for startup, and the records and reporting required by

§

201.263

and Sections 39.5(7)(a)

and (e) of the Act, the provisions that the Agency cited as

the

regulatory

basis for Conditions 7.1.9-4(a) and 7.7.9(d), do

not address startup at all;

§

201.263

is limited in

its scope to records and reports required for operation during malfunction

and breakdown where

there are excess emissions.

Therefore, one must conclude that the records that the Agency

requires here would be

considered gaptilling and

are limited to what is necessary to assure

compliance with emissions limits.

97.

Requiring the additional

reeordkeeping if startups exceed the specified periods

does

not provide any additional

information necessary to assure compliance

with the permit and

so cannot be characterized as gapfilling.

DMG is already required to provide information

regarding when startups

occur and how long they last

by Conditions

7.1 .9-4(a)(ii)(A)

and

~

DMG

had no

input into the

length of time

that triggered

the

additional recordkeeping and reporting

other than to

provide the total

length of time necessary

for

a cold

startup.

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7.7.9(d)(iiXA).

Emissions of

SO2, NOx, and opacity during

startup of the

boilers are

continuously monitored

by

the CEMS/COMS.

DM0 has already established that the

magnitude

of emissions

of PM and CO

cannot be reliably provided

(see

above).

ftc

additional

inlbrmation

that the

Agency requires

in Conditions

7.l.9-4(a)(ii)(C) and 7.7.9(d)(ii)(C) does nothing

to

assure compliance with the emissions limitations,

which is the purpose of the permit in

the first

place, and so exceeds the

Agency’s authority to

gapfill.

98.

For these reasons, Conditions

7.1.9-4(a)(ii)(C) and 7.7.9(d)(ii)(C), contested

herein, are

stayed consistent with the APA, and DM0

requests that the

Board order the

Agency

to delete the conditions, consistent with the

startup provisions of 35

Ill.Adm.Code

§

201.149 and

the inapplicability

of

§

201.263.

(ix)

Malfunction

and Breakdown Provisions

99.

Illinois’

approved Title V program allows the Agency to grant sources the

authority to operate during malfunction and breakdown, even though the

source emits in excess

of its

limitations, upon certain showings by

the permit

applicant.

The authority

must be

expressed

in the

permit, and the

Agency has made such a grant of authority to DM0 for the

Vermilion

Power Station.

This

grant of authority provides an affirmative defense in

an

enforcement action.

Generally see

Conditions 7.1.3(c) and 7.7.3(c).

100.

Conditions

7.1.1 0-3(a)(i) and 7.7.1 0(c)(i) require that DM0 notify the

Agency

“immediately” if it operates during malfunction and breakdown

and there could be PM

exeeedances.

Likewise, Condition

7.1.1 0-3(a)(ii) imposes additional reporting obligations if the

“PM emission standard may have been exceeded.”

The Agency is demanding that DM0 notify

it of the mere supposition that there have been PM

or opacity exceedanees.

The Agency has

provided

no regulatory basis for reporting suppositions.

At the very least, DM0 should

be

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granted the opportunity to investigate

whether operating conditions arc such that support or

negate the

likelihood that there may have

been PM

or opacity emissions

exeeedances.

0MG

does

not believe that even this

is necessary, since the Agency lacks a regulatory basis

for this

requirement

in the

first place.

Reference to reliance on

opacity as an indicator

of PM emissions

should be

deleted.

The condition as written exceeds the scope

of the Agency’s authority to

gaplill and so

is unlawful, arbitrary

and capricious.

101.

Also in Conditions

7.1,1 0-3(a)(i) and

7.7.2 O(c)(i),

the Agency has deleted the

word

consecutive

as a trigger for reporting opacity

and potential

PM exceedances during

an

“incident”

in the final

version of the permit.

Versions prior to the July 2005 version include that

word.

Its deletion completely changes the scope and applicability of the

condition.

Please

see

DMG’s comments

on

each version of the

permit in

the Agency Record.

As the

series of

comments demonstrates, it

was not

until

the draft revised proposed

permit

issued in July 2005

that the Agency had deleted

the concept of consecutive 6-minute averages of opacity from this

condition.

In the

December 2004 version of the permit, the

word

consecutive

had been replaced

with

in a row,

but

the concept

is the

same.

102.

The Agency has provided

no explanation for this change.

As the actual

opacity

exceedance could alone comprise the “incident,” DM0 believes that

it

is more appropriate to

retain the word

consecutive

in the condition

(or add it back in to the condition).

Random,

intermittent exceedances of the

opacity limitation do not necessarily comprise a

malfunction/breakdown “incident.”

On the other hand, aprolonged period of opacity

exceedance does possibly indicate a malfUnction/breakdown “incident.”

‘I’he trigger for PM

opacity reporting under Condition

7.7.10(c)(ii) is

not specified, but

such reporting appears to be

triggered when “immediate” reporting

is required under 7.7.l0(c)(i).

Condition 7.7.I0(c)(ii)

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therefore suffers

from

the same

deftct and

the Agency

has not explained or supported

the trigger

for additional

reporting under this condition.

The timeframe for additional opacity reporting

under Condition 7.l.10-3(a)(ii)

also has not been explained or supported by

the Agency and the

timeframe

is unreasonahle.

The triggers

for additional reporting under Conditions

7.7.l0(c)(ii)

and

7.1.1 0-3(a)(ii) are arbitrary and capricious.

103.

Additionally, Condition 7.l.10-3(a)(i) requires reporting ifopaeity exceeded the

limit for “five or more 6-minute averaging periods.”

The next sentence

in the

condition says,

“(Otherwise,

.

.

.

for

no more than five 6-minute

averaging periods...)”

lhe

language

is

inconsistent.

The

way the condition

is written, the permittec cannot

tell whether

five six-minute

averaging periods of excess opacity

readings does

or does

not require reporting.

Condition

7.7.! 0(e)(i) clearly requires reporting only when there are

five or more

averaging period

exceedances.

The language of Condition

7.1.1 0-3(a)(ii) should be amended

to remove the

inconsistency, and to ensure

a consistent trigger for reporting opacity exceedances across all

applicable

operations for the reasons discussed elsewhere.

104.

Forthcse reasons, Conditions 7.1.lO-3(a)(i) and (ii),

7.7.l0(e)(i) and (ii),

contested herein,

are stayed

consistent with the APA, and DM0

requests that the Board order the

Agency to make appropriate revisions

in these conditions to correct the

deficiencies referenced

above, including by deleting reporting requirements for possible

exceedances and including

appropriate triggers for reporting of actual exceedances.

(x)

Alternative Fuels Requirements

105.

The Agency has included at Conditions

7.1 .5(a)(ii)-(iv) requirements that become

applicable when Vermilion uses

a fuel other than coal as

its

principal fuel.

Condition

7.1 .5(a)(ii)

identifies what constitutes using an alternative fuel

as

the principal

fuel and establishes emissions

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limitations,

Condition 7.l.5(a)(iii)

also describes the conditions under which the Station would

be considered to be using an

alternative fuel

as

its

principal

fuel.

Condition

7.1 .5(a)(iv) requires

notification to the Agency prior to the

Station’s

use of an

alternative fuel

as its principal fuel.

106.

Inclusions of these types of requirements in Condition 7,1.5, the

condition

addressing non-applicability of requirements,

is organizationally

misaligned under the

permit

structure adopted by

the

Agency.

‘these provisions should he included in the

proper sections of

the permit,

such

as 7.1.4

for emissions

limitations and

7.1,10-3

for notifications.

In the

alternative, they should be in Condition 7.1.11(c), operational

flexibility, where

the Agency

already has a provision addressing

alternative fuels.

As the

Agency has adopted a structure

for

the CAAPP permits that is fairly consistent

not

only

among units in a single permit but also

among permits,’4 for the Agency

to include specific

recordkeeping requirements in the

compliance section

creates a disconnect and uncertainty regarding where

the permittee

is to

find

out what he

or she is supposed to do,

107,

Additionally,

at Condition

7.1.1

1(c)(ii), the Agency’s placement of the examples

of alternative fuels

seems to define them

as hazardous wastes,

The intent and purpose of the

condition is

to ensure that these alternative

fuels arc not classified

as a waste

or hazardous

wastes.

The last

phrase of the condition,

beginning with “such

as petroleum

coke, tire derived

fuel...,”

should he placed immediately

after “Alternative

fuels” with punctuation and other

adjustments to the language as necessary, to clarify that the examples listed are

not hazardous

wastes and are

not considered to be a waste.

108.

Forthese reasons, Conditions

7.1.5(a)(ii), 7.1.5(a)(iii), 7.l.5(a)(iv), and

7.1.11 (c)(ii), all contested herein, are

stayed consistent with the APA,

and DM0 requests

that the

‘~

That

is,

Condition 7.x.9

for

all

types

of

emissions

units

in

this

permit, from

boilers to tanks, addresses

recordkeeping.

Likewise,

condition

7.x,9 addresses recordkeeping

in all

of the CAAPP permits

for EGtJs.

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Hoard

order the

Agency

to place Conditions

7.1 .5(a)(ii)-(iv)

in more appropriate sections of the

permit and to clarify Condition 7.1.1

l(c)(ii).

(xi)

Control Plans, Operating Logs and Reporting Requirements Related

to

the

Schedule

109.

As discussed

above,

the permit contains

a number of conditions that expressly

or

implicitly characterize, refer to

or attempt to implement provisions

of the

Schedule (which

reflects provisions from the

Consent Decree).

In addition to and

without

limiting the

reasons set

forth earlier

in this petition

l’or deleting such provisions, the

conditions identified

in this

scclion

of this petition

also should be deleted

for the reasons set

forth below.

110.

Condilions 7.l.6-2(b)(ii), 7.l.6-2(c)(iv), 7.1.9-2(b), and 7.1.9-4(c) require DM0

to develop, implement,

maintain and submit

procedures,

practices

and

related records

for the

control ofNOx and PM, emissions, defined in the permit as “control plans.”

The Agency,

however, does

not have the authority

to require DM0 to develop,

implement,

maintain and

submit a “control

plan” for NOx and

its

inclusion is arbitrary and

capricious.

With

respect

to

PM, the Consent Decree

already requires ESP optimization plans.

Adding another PM control

plan requirement

is unnecessary and could result in additional and inconsistent obligations.

Accordingly,

the

requirements concerning

PM controls plans

are arbitrary

and capricious and

unauthorized by

law.

Ill.

Forthese reasons, Conditions 7.l.6-2(bXii),

7.1.6-2(c)(iv),

7.1.9-2(h),

and 7.1.9-

4(c), all contested herein, arc

stayed consistent

with the

APA, and DMG requests that the Board

order the Agency to delete these conditions and all references

to these conditions

from the

permit.

112.

Condition

7.1 .9-2(a)(i)

requires DM0 to maintain operating logs with respect to

“operating procedures related to control

equipment that are required to

he or

are otherwise

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implemented pursuant

to Conditions

7.1.6-2(h) and (c)”

Condition

7,1

.9-l(f)(ii)

also requires

operating

logs with respect

to

actions required under Conditions 7.1,6-2(h) and (c).

Conditions

7.1.6-2(h) and (c).

in turn, require compliance

with and purport to characterize various

provisions

in the Schedule relating to

NOx and PM emissions and the “control plans” that,

as

described

above, should be deleted

from the permit.

113.

Neither the

Consent Decree nor any other applicable

requirement authorizes or

imposes

the duplicative obligations set forth in Conditions 7.l.9-2(a)(i) and 7.1,9-1(f)(ii)

Conditions 7.1.6-2(h) and (e) characterize and describe various requirements of the

Consent

Decree,

which is

improper and unnecessary for the reasons set forth earlier in this petition.

114.

For these reasons, Conditions 7.1.6-2(b) and (d), 7.1.9-1(1)01) and 7.1.9-2(a)(i),

all

contested herein, are

stayed consistent with the

APA, and DM0 requests that the

Board order

the

Agency to delete these conditions and all references to these conditions from

the permit.

115.

Condition 7.l.10-2(h)(iii) and (dXiv)

impose reporting

requirements

with respect

to compliance with the S02 and PM,

respectively, emission limits

and requirements set

forth

in

7.1.6-1, which

in turn reflects certain emission limits

and requirements from

the Consent

Decree.

The reporting

requirements set forth

in Conditions

7.1.! O-2(b)(iii) and (d)(iv) exceed

reporting requirements

set forth

in the Consent Decree, and the reporting requirements set forth

in such conditions

are not otherwise authorized or required by law.

In addition

as

set

forth

above, 7.1.6-1

is redundant with the Schedule requirements and imposes requirements after the

expiration date of the permit.

116.

Forthese reasons,

Conditions 7.1.6-1

and 7.1.IO-2(b)(iii) and (d)(iv),

all contested

herein, are stayed consistent with the APA,

and DM0 requests that

the Board order the Agency

to delete

these conditions and all references

to

these conditions from the permit.

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(xii)

Testing

Requirements

I 17.

Conditions

7.1,7(e) and

7.7.7-I(b)(iv) identifies detailed information that

is

to he

included in certain

test reports,

including target

levels and settings.

To

the extent that these

requirements

are or can

be viewed as enforceable operational requirements or parametric

monitoring conditions, DM0

contests these conditions.

Operation ofan

electric generating

station depends

upon

many variables

—

ambient

air temperature, cooling water supply

temperature, fuel supply,

equipment variations, and so

forth

such that different settings

are

used

on a daily basis.

Using those settings as some type of monitoring device or parametric

compliance data would be inappropriate.

For these reasons, Conditions 7.1.7(e) and 7.7.7-

I (b)(iv), all contested herein,

are stayed

consistent with the APA, and DM0 requests that the

Board order the

Agency

to delete or revise these conditions to correct these deficiencies.

(xiii)

Monitoring

and Reporting Pursuant to NSPS

118.

It appears from various conditions in the

permit that the Agency believes that

Vermilion

is subject to NSPS

monitoring and reporting requirements pursuant to the Acid Rain

Program.

DMG’s review of the

applicable requirements under

the Acid Rain Program

does

not

reveal

how the Agency

arrived at this conclusion.

This is

an example of how a statement of

basis

by

the Agency would have been very helpful.

The

Acid Rain Program requires monitoring

and reporting pursuant to 40 CFR Part 75.

Specifically, 40 CFR

§

75.2 1(b) states that

continuous

opacity monitoring shall be conducted

according to procedures

set forth in state

regulations where they exist.

Reeordkeeping

is addressed at

§

75.57(f) and reporting at

§

75.65.

None of this references Part 60, NSPS.

119.

Arguably,

it is odd that

a permittee

would appeal a condition

in a permit that

states that regulatory provisions are not applicable.

however,

consistent with DMO’s analysis of

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the

Acid

Rain

requirements. the permit. arid

the

Board’s regulalions,

it

must also appeal

Condition 7.1.5(b), which pui-ports to exempt the Station from

the

requirements of35

lll.Adm.Code 201.Subpart

L based

upon

the applicability ofNSPS,

NSPS does not apply to the

Station through the

Acid Rain Program,

and so this condition

is

inappropriate.

120.

Conditions 7.1. l0-2(b)(i),

7.1. l0-2(c)(i),

and 7.1.1 0-2(d)(i) require DM0 to

submit summary information on

the

performance of the 502. NOx,

and opacity

monitoring

systems, including the

information specified

at 40 CFR

§

60.7(d).

Condition

7.1. lO-2(d)(iii), in

the

“Note,” refers, also, to NSPS

§~

60.7(e) and (d).

The information required

at

§

60.7(d) is

inconsistent with the information required by

40 CFR Part 75, which sets forth the

federal

reporting requirements applicable to boilers that arc affected units under the Acid

Rain program.

Section 60.7(d) is not

an “applicable requirement,” as

the

boilers at the

Station

are not

subject to

the NSPS.

For DM0 to comply with these conditions would entail reprogramming or

purchasing and deploying additional

software for the

computerized CEMS,

effectively resulting

in the

imposition of additional substantive requirements through the CAAPP permit beyond the

limitations of gapfilling.

Moreover,

contrary to Condition 7.1.I0-2(d)(iii), DM0

does

not

find a

regulatory

link between the NSPS provisions of 40 CFR 60.7(c) and (d) and the

Acid

Rain

Program.

121.

For these reasons, conditions

contested in this section, including Conditions

7.1.5(b), 7.1.1 0-2(b)0),

7.1

.1 0-2(c)(i),

7.1.1 0-2(d)(i), 7.1.1 0-2(d)(iii),

and the “Note” to 7.1 .10-

2(d)(iii), are

stayed

consistent with the

APA, and DM0 requests that the

Board order the Agency

to delete all references to NSPS and 40 CFR

60.7(e) and (d).

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ELECTRONIC

FILING,

RECEIVED,

CLERK’S OFFICE

NOVEMBER 3,

2005

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POB 2006-073

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(xiv)

Opacity

Compliance Pursuant to

§

212.123(b)

122,

The

Board’s regulations at 35

lll.Adm.Code

§

212.123(b) provide

that a source

may exceed the 30

opacity limitation of

§

212.123(a) for an aggregate of eight minutes in a 60-

minute period but

no more than three times in a 24-hour period.

Additionally, no other unit at

the source located

within a

1,000-foot

radius

from the

unit whose emissions exceed 30

may

emit at such

an opacity during the

same 60-minute period.

Because the opacity

limit at

§

212.123(a) is expressed as

six-minute averages pursuant

to Method

9(see

Condition

7.1.1 2(a)(i)), a source demonstrating compliance

with

§

212.123(b) must reprogram

its

COMS to

record opacity over

a

different timeframe than would be required by demonstrating compliance

with

§

212.123(a) alone.

The

Agency attempts

to

rctlect these provisions

at Condition

7.1.12(a),

providing for compliance

with

§

212.123(a) at Condition 7.1.12(a)(i)

and separately

addressing

§

212.123(b)

at Condition 7.1.12(a)(ii).

Additionally, the

Agency requires DM0

to

provide

it

with

15

days’

notice prior to changing

its procedures

to accommodate

§

212.123(b) at Condition

7.1.1 2(a)(ii)(E).

These conditions raise several

issues.

123.

First, Condition

7.1. l2(a)(ii) assumes that accommodating the “different”

compliance

requirements of~212.123(b),

as compared to

§

212.123(a),

is

a change in operating

practices.

In fact,

it

is not,

Arguably, then, DM0 has nothing to report to the

Agency pursuant

to Condition 7.l.12(a)(ii)(E), because no change

is occurring.

124.

Second,

as with

DMO’s objection to Condition 5.6.2(d),

Condition

7.1.1 2(a)(ii)(F)

is an intrusion by government into

the operational practices

of a source beyond

the scope of government’s authority to so intrude.

The Agency states that the purpose of the

15

days’ prior notice is

so

that the Agency can review the

source’s reeordkeeping and data handling

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RECEIVED, CLERK’S OFFICE

NOVEMBER 3,

2005

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procedures, presumably to

assure that they

will comply

with the requirements implied

by

§

212.123(h).

This is an unwarranted and unauthorized extension of the

Agency’s authority.

125.

Moreover, while Condition

7.1.1 2(a)(ii)(E)

says that the Agency will review

the

recordkeeping and data handling practices of the

source,

it says nothing about approval

of them

or what the Agency plans

to do with the review,

The Agency

has not explained a purpose

for the

requirement in a statement-of-basis document or

in its Responsiveness Summary

or shown

how

this open-ended condition

assures compliance with the applicable requirement.

Because the

Vermilion Power Station

is required to operate a COMS, all of the

opacity readings

captured by

the

COMS

are recorded and available

to the Agency.

The Agency has had ample opportunity to

determine whether the Station has complied with

§

212123(b).

DMG’s providing

15

days’ prior

notice of its “change” to accommodating

§

212.123(b) will

not

improve the Agency’s ability

to

determine the

Station’s compliance.

126.

Conditions 7.1.1 0-3(a)(i) and (ii) do

not accommodate the applicability of

§

212.123(b).

The Board’s regulations

do not limit when

§

212.123(b) may apply beyond

eight

minutes per

60 minutes three timesper

24

hours.

~I’herefore,any limitation on opacity must

consider

or accommodate the applicability of

§

2 12.123(h) and not

assume or imply that the only

applicable opacity

limitation is

30.

127.

Finally, inclusion of recordkeeping and notification requirements relating to

§

212.123(b)

in the compliance section of the permit is organizationally misaligned under the

permit structure adopted by

the Agency.

These provisions, to the extent that they are appropriate

in the first place, should be included in the proper sections of the pennit,

such

as 7.1.9 for

recordkeeping and 7.1 .10 for reporting.

As the Agency has adopted a structure for the CAAPP

permits that is

fairly consistent not

only among units in a single permit but also among permits,

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ELECTRONIC

FILING,

RECEIVED, CLERK’S OFFICE

NOVEMBER 3,

2005

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