BEFORE THE ILLINOIS POLLUTION CONTROL BOARD

IN THE MATTER OF:

)

SECTION 27 PROPOSED

)

RULES FOR NITROGEN OXIDE )

(NOx) EMISSIONS FROM

) R07-19

STATIONARY RECIPROCATING ) (Rulemaking - Air)

INTERNAL COMBUSTION

)

ENGINES AND TURBINES:

)

AMENDMENTS TO 35 ILL.

)

ADM. CODE PARTS 211 AND )

217.

)

Proceedings held on April 9, 2008, at 9:00 a.m., at

the Madison County Administration Building, Room 203,

157 North Main Street, Edwardsville, Illinois, before

Timothy J. Fox, Hearing Officer.

Reported by Holly A. McCullough,

C.S.R., C.C.R., R.P.R.

KEEFE REPORTING COMPANY

Eleven North 44th Street

Belleville, IL 62226

(618) 277-0190

Keefe Reporting Company

APPEARANCES:

Timothy J. Fox

Hearing Officer

Illinois Pollution Control Board

100 West Randolph Street, Suite 11-500

Chicago, IL 60601

Andrea Moore

Attending Board Member

Illinois Pollution Control Board

100 West Randolph Street, Suite 11-500

Chicago, IL 60601

Anand Rao

Senior Environmental Scientist

Illinois Pollution Control Board

100 West Randolph Street, Suite 11-500

Chicago, IL 60601

Rachel L. Doctors

Illinois Environmental Protection Agency

1021 North Grand Avenue East

P. O. Box 19276

Springfield, IL 62794-9276

Also present from the Illinois Environmental

Protection Agency:

Robert J. Kaleel

and Yoginder Mahajan

For Illinois Municipal Electric Agency (IMEA) and

For Illinois Environmental Regulatory Group (IERG):

N. LaDonna Driver

Hodge, Dwyer, Zeman

3150 Roland Avenue

P. O. Box 5776

Springfield, IL 62705-5776

Also present for IMEA:

Kevin Wagner

Also present for IERG:

Deirdre K. Hirner

Keefe Reporting Company

APPEARANCES CONT.:

Also present

Joshua R. More

Schiff Harden, LLP

6600 Sears Tower

Chicago, IL 60606

INDEX OF EXHIBITS:

IEPA Exhibit No. 1 -- Page 8-9

(IEPA Exhibit No. 1 is attached hereto.)

INTERROGATION INDEX:

Opening Remarks -- Page 4

Opening Comments by Ms. Doctors -- Page 7

Questions of Mr. Kaleel by Ms. Driver -- Page 12

Questions of Mr. Kaleel by Mr. More -- Page 27

Questions of Mr. Kaleel by Mr. Rao -- Page 32

Questions of Mr. Kaleel by Ms. Driver -- Page 39

Comments by Ms Driver -- Page 42

Questions of Mr. Wagner by Mr. Rao -- Page 44

Questions of Mr. Wagner by Ms. Driver -- Page 47

Questions of Mr. Wagner by Mr. Rao -- Page 48

Questions of Mr. Kaleel by Ms. Driver -- Page 53

Questions of Ms. Hirner by Mr. Rao -- Page 56

Questions of Ms. Hirner by Ms. Driver -- Page 58

Closing Remarks -- Page 59

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PROCEEDINGS:

(April 9, 2008, 9:00 a.m.)

HEARING OFFICER FOX: Good morning and welcome to

this Illinois Pollution Control Board hearing. My

name is Tim Fox, and I'm the Hearing Officer for this

rulemaking, which is entitled "Section 27 Proposed

Rules For Nitrogen Oxide Emissions From Stationary

Reciprocating Internal Combustion Engines and

Turbines: Amendments to 35 Illinois Administrative

Code Parts 211 and 217". The Board docket number for

this rulemaking is R07-19.

In an Order dated January 10th of 2008, the Board

granted the Illinois Environmental Protection Agency's

motion to proceed with an amended proposal and

directed the Hearing Officer to proceed to hearing.

Also present from the Board today are to my left

Board Member Andrea Moore, who is the lead Board

member for this rulemaking, as well as to my right

Anand Rao of the Board's technical staff. Member

Moore, did you wish to make any remarks at this time?

MS. MOORE: Careful what you whisper. The

microphone is on. And welcome all, and we appreciate

the amount of time and effort that's gone into

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producing this rule and look forward to getting a good

record.

HEARING OFFICER FOX: Very well. Today we are, of

course, holding the first hearing in this rulemaking.

The second hearing is now scheduled to take place

beginning Wednesday, May 7th, 2008 in Chicago. More

details about that are in the notice of hearings that

are posted on the Board's web site under this docket

number.

This proceeding is governed by the Board's

procedural rules, under which all information that is

relevant and is not repetitious or privileged will be

admitted into the record. Please note that any

questions today that are posed either by the Board

member or by the Board staff are intended solely to

insist in developing clear and complete record and do

not reflect any prejudgment on the merit of this

proposal that's before the Board.

For this first hearing, the Board on March 26th,

2008 received prefiled testimony from the Illinois

Environmental Protection Agency by Mr. Yoginder

Mahajan and from Mr. Robert Kaleel. On the same date,

the Board also received prefiled testimony from the

Illinois Municipal Electric Agency or IMEA by

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Mr. Kevin Wagner, and also on March 26th, the Board

received prefiled testimony from the Illinois

Environmental Regulatory Group or IERG, often

pronounced IERG, by Miss Deirdre Hirner. We will

begin this hearing, of course, with that prefiled

testimony, and we'll hear first from the witnesses

from the IEPA, which is, of course, the proponent in

this proceeding, and this will be followed by

questions that others present may have for the

Agency's witnesses. We will then turn at Miss

Drivers' direction to Mr. Wagner for his testimony,

which will also be followed by any questions of those

participants here today may have for him, and then

also at Miss Drivers' direction we'll then turn to

Miss Hirner for the testimony on behalf of IERG,

followed, of course, by questions the participants may

have.

While I know that you are all veterans of these

kind of proceedings, for the benefit of our Court

Reporter, please speak clearly, and, if you would,

please avoid talking at the same time as any other

participant here. That would certainly help her to

transcribe this and for us to have a transcript that

is as clear as possible.

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Are there any questions before we move forward

with the Agency's witnesses?

(No response.)

HEARING OFFICER FOX: Very well. Having spoken

off the record with Miss Doctors before the hearing,

it was her intention I believe, and she'll correct me,

that she wish to have the Agency's two witnesses sworn

in together, and that they did not have any kind of

remarks to offer, and that they would be prepared to

move directly to questions. Is that correct, Miss

Doctors?

MS. DOCTORS: That's correct. And I have a couple

of comments I'd like to make on the record before we

start with questions.

HEARING OFFICER FOX: This seems like as good a

time as any if you want to pose those.

MS. DOCTORS: On behalf of the Director, I'd like

to thank the Board for its consideration for this

rulemaking proposal and it's opportunity to provide

testimony in support of R07-19. As Mr. Fox just

mentioned, we're going to go straight to questions.

I would like to note that on March 24th, 2008,

this EPA issued a SIP call to all states with ozone

non-containment areas that had failed to submit

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complete RACT SIPs. Illinois is such a state. The

Federal Register began an 18 month sanction of the

law. If Illinois does not submit the complete RACT

SIP by August, 2009, the offset sanction will apply,

which concerns emissions for modified or new

construction in non-containment areas, and if we do

not submit within 24 months, timely sanctions would

apply.

I've given each participant a copy of this Federal

record.

HEARING OFFICER FOX: Ms. Doctors, just for the

sake of clarity, that is the Federal Register, Volume

73, page 15416, the title "Findings of Failure to

Submit State Implementation Plans Required for the

1997 8-hour ozone NAAQS". Do I have the correct

document?

MS. DOCTORS: Yes.

HEARING OFFICER FOX: And did I hear a motion to

admit that as hearing Exhibit No. 1.

MS. DOCTORS: Yes.

HEARING OFFICER FOX: Is there any objection to

the motion to admit that as Exhibit 1?

(No response.)

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HEARING OFFICER FOX: Neither seeing, nor hearing

any, it will be marked and admitted as Exhibit 1. Ms.

Doctors, thank you.

MS. DOCTORS: And the second comment, I'd like to

note that I found some typographical errors --

typographical errors have been brought to my attention

by both Miss Driver and Mr. More, and we're waiting

for the Board to tell us which is the correct document

that's been published to use for identifying which set

of typographical errors the Agency should submit as an

errata sheet. The Agency would like to do this at the

second hearing if possible.

And, also, the Agency would note that IERG has

proposed an amendment that concerns offsets that they

agree with, and that would be part of that sheet

showing some changes to the rule at the second

hearing.

MS. DRIVER: That's correct.

OFFICER HEARING FOX: Again, just for sake of

clarity -- I'm sorry to interrupt you -- I believe

Miss Hirner's pretrial testimony included specific

language proposed for that very issue; is that

correct?

MS. DOCTORS: Correct. And the Agency is in

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agreement with that language. I was just going to put

it all together in one document.

HEARING OFFICER FOX: Thank you for clarification.

And if I may jump back -- and I'm sorry to interrupt

you again -- the Board appreciates your notice,

Mr. More's notice and Miss Driver's notice that there

were apparently some discrepancies between different

versions of the rule, and we will expeditiously see,

with your help gracefully, where those are and how

they arose at the earliest possible opportunity and

let you and the other participants know precisely

which version you can safely rely upon with the Board

in proposing various changes in an errata sheet or

otherwise. So, thank you all for bearing on that. We

work at resolving that as quickly as possible.

MS. DOCTORS: Thank you. The other thing the

Agency would like to know is that Section 201.146 is

also being amended, even though it's not in this title

of this -- in R07-19, that that had been part of the

Board's earlier order that they would remove it from

R07-18 to R07-19 to that amendment. Is that correct?

HEARING OFFICER FOX: I believe that was part of

the original proposal filed in March or April of '07.

It was not included in the second notice opinion and

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order for the final adoption of R07-18, and I'm sure

we'll have a brief question about your intentions for

that language in this proceeding, but it sounds like

you are suggesting that you may wish to amend the

caption to reflect the fact that there would be

language in 201.146, if I recall correctly, that would

be opened up and amended in this proceeding.

MS. DOCTORS: Correct.

HEARING OFFICER FOX: Very good. We'll certainly

take note of that, and I appreciate you placing it on

the record.

MS. DOCTORS: I'd like now to open it up for

questions to my witnesses.

HEARING OFFICER FOX: If I could just ask -- and,

again, apologies for the interruption -- were there

any other procedural questions or any other issues

that any of the participants wish to raise?

(No response.)

HEARING OFFICER FOX: Very good. If you're set,

Miss Doctors, I'll have the Court Reporter swear in

your two witnesses and proceed then.

(At this time, ROBERT KALEEL and YOGINDER MAHAJAN

are sworn in.)

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HEARING OFFICER FOX: And having been sworn in,

both Mr. Kaleel and Mr. Mahajan on behalf of the

Agency are available for any questions. If anyone has

a question that they'd like to pose, please just raise

your hand so I may recognize you, and on the first

recognition, if you would just state your name and any

organization that you may represent for the benefit of

the Court Reporter and the record, that would be much

appreciated. Any questions for either of the

gentlemen? Miss Driver?

MS. DRIVER: Thank you, Mr. Fox. My name is

LaDonna Driver. I'm an attorney here today for two

entities, the Illinois Municipal Electric Agency,

which I'll call IMEA for short, and the Illinois

Environmental Regulatory Group, which I'll call IERG

for short. Thank you for the opportunity to be here

and participate in this rulemaking.

E X A M I N A T I O N

by Ms. LaDonna Driver:

Q. I have just a few questions for Mr. Kaleel,

and they are basically just to clarify a few things in

the ruling and in the prefiled testimony. The first

question that I have, Mr. Kaleel, is in the

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applicability section of the rules, which is Section

217.386, and I'm specifically looking at the

exemptions, (b)(5), this is the exemption that has

commonly been called the portable unit exemption or

mobile unit exemption. Let me know, Mr. Kaleel, when

you've got it in front of you.

A. I found that section.

Q. Okay. Great. Just a couple of questions

that some of our members were wanting some

clarification on this provision. Could you provide

some insight as to why the Agency chose to cap this

exemption at 1500 horsepower for engines?

A. I guess I really don't recall what the

rationale for the 1500 was at this time. I think the

1500 is considered a significant emission unit for our

purposes. I guess I need to defer to comments if I

could at this time as to rationale for the 1500.

Q. Certainly. That would be fine. The other

thing that we were interested in on this provision is

that it seems to get to the concept of mobile units

being or portable units not really being considered a

stationary unit that's subject to this rule. Are we

right about that provision?

A. That's right.

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Q. Okay. The language that you have towards

the end of this provision is that it has to move to a

different source at least once every 12 months. We

understand the term "source" to mean something in air

regulations. Can you talk a little bit about -- Does

the Agency truly envision that in order for this

provision to apply that you physically would move it

to a different Clean Air Act source every 12 months?

A. That is our intent. We are aware that

people use engines for a lot of different purposes,

and in many cases if they remain in a particular

source, then they are truly stationary. There are

other people that use engines that perhaps move them

from site to site on a very frequent basis, and it's

very difficult for us to track those or permit those

or to be able to have knowledge of where those are at

all times. Sometimes they may move them within a

non-containment area and then move them outside the

non-containment area. These are typically not real

large engines that are used for that purpose. We

didn't intend to regulate those. But the engines that

are at a source, even if they're perhaps moved within

the locations within the source, we did intend,

provided that they're not exempt.

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Q. So, just so I understand what you're saying,

Mr. Kaleel, if a company wants to move its unit within

its one source facility, is it your position then that

this provision does not apply because it has not moved

to a different Clean Air Act source, different

facility? Do you understand my question?

A. Well, maybe you could ask it again.

Q. Sure. What I'm getting at is the situation

where a source has an engine that could move within

that source. It could move to one production building

and be used for some spot power needs there, and then

maybe in a few months they need it at a different

production building at that same source -- permitted

source. Is that the kind of situation that you

envision this exemption covering? They're not leaving

the permitted source. They're moving around within

that permitted source.

A. Thank you for clarifying your question.

That is more what we had in mind. If that engine or

turbine is located at a particular source, that

engine, provided that it meet the other applicability

requirements, that that engine would be affected.

Q. Okay. So, even if they are physically

moving the unit around at that source, you do not

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intend for this exemption to apply?

A. That's right.

Q. Okay. Does that movement within that source

make the unit any less mobile? I guess I'm trying to

understanding the distinction in your mind on

exempting something that's moving around within a

source as opposed to it just moving across the road to

another source from a control standpoint.

A. I guess I can't envision a situation where

somebody would move it right across the road, but

we're really thinking of things like construction

sites or perhaps asphalt plants that are movable and

mobile. They're not going to be in the same general

location for any significant length of time. It's

difficult to regulate units like that, difficult to

track them, to inspect them on a regular basis or

routine basis.

Q. Well, thank you for offering to provide us a

little bit more information on the levels that you're

looking at in this provision. We'll move on from here

on that.

A. Okay.

Q. The other provision that I wanted to ask you

about is in Section 390.217. I'm sorry. That's the

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wrong section. I have my pages moved around. Pardon

me. Section 217.388(c).

MS. DOCTORS: At the bottom of page 3?

MS. DRIVER: Yes.

A. Okay.

BY MS. DRIVER:

Q. This is I think what we've commonly called

the low usage compliance option?

A. Yes.

Q. And in looking at your prefiled testimony,

specifically on page 6 of your prefiled testimony --

A. Okay.

Q. -- in the top paragraph on that page, you

talk about towards the end of that paragraph low usage

units, and in the next to the last sentence of that

paragraph, you state here that one provision of low

usage units from all engines and turbines at a source

are below a hundred ton per year of NOx emission.

Could you talk about the scope of that statement in

comparison to the provision of Section 217.388(b)(1)?

And what I'm getting at here is the statement in your

prefiled statement that "all engines and turbines at a

source is below a hundred tons per year" as compared

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to the rule language in Section 217.388(b)(1), and

specifically which units you count in that hundred ton

per year limit and which ones do not count.

A. Okay. Yes, we have to clarify. I think

perhaps in my prefiled testimony I was a little too

general or too informal and were not precise enough in

the way I worded that. What would count towards the

hundred tons per year or what we're asking the company

to do is to compute for us the potentials from that

distinguished from actual emissions. The potentials

would consider a unit that might operate continuously,

and many of the engines that we are -- or units, not

just engines, turbines -- do not operate continuously.

So, we've written into the rule that if the company

was to accept limit potentials would emit less than a

hundred tons per year of aggregating all engines and

turbines located at a source that aren't otherwise

exempt, so that would limit our exemptions and

applicability criteria, and those would not count

towards the PTE calculation and also other units that

are otherwise in compliance with the emission limits

contained within the rule. So, it's just certain

units that would count towards the PTE calculation,

and it wasn't intended as being broad as I

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characterized it in my testimony.

Q. Very good.

MR. RAO: May I ask a follow up? You also have a

hundred tons per year of NOx emission criteria under

Section 217.386(a)(2)?

A. Yes.

Q. Basically that section states for engines to

be subjected to this rule, they're supposed to emit or

put out -- potentially emitting NOx in an amount equal

to or greater than a hundred tons per year?

A. Yes.

MR. RAO: When you say "emission of NOx to be

equal to or greater than a hundred tons per year on

that source," that's NOx from the engines and

turbines, or are there any other NOx emissions that

can also be calculated in that?

A. In the applicability section, 386(a)2), it

could refer to any emission units that emits NOx at a

source. So, if they --

MR. RAO: If there's a major source of NOx, if

somebody's engine is meeting the criteria that you

have under subsection (a)(2) A and B, they are subject

to the rules?

A. They are subject to the rule. And

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distinguishing the intent of that law is from the one

that Ms. Driver was asking about, this is specifically

for a low usage exemption for engines that might be

within a source that has other types of emission

units, whether it's boilers or process sources. I'm

trying to distinguish low usage from any general

applicability of a hundred tons per year.

MR. RAO: Thank you.

HEARING OFFICER FOX: Thank you.

BY MS. DRIVER:

Q. And then following up on that, Rob --

Mr. Kaleel, for those engines or turbines that would

meet one of the ruling exemptions, they would not get

counted towards that hundred ton low usage

designation?

A. That's correct.

Q. And if a source has certain units, engines

and turbines that it decides can comply with the

proposed rules emission limits, those also do not get

counted towards the hundred ton per year limit?

A. That's correct.

Q. Very good. Thank you for that

clarification. While we're on the low usage

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provision, just one more point to clarify here. The

hundred ton per year provision that we were just

looking at is in (c)(1), but then there's an operating

hour low usage designation in (c)(2), and it's broken

down to accommodate both engines and turbines, and

(2)A is engines, and (2)B is turbines. It's our

understanding, Mr. Kaleel, that the Agency intends

that if a source wants to take advantage of the low

use designation and they have engines and turbines,

not just one or the other, that they could take

advantage of the 8 million horsepower hours for their

engines in (c)(2)A, as well as the 20,000 megawatt

hours for turbines in (2)B, that they could use both?

A. They can use both.

Q. They can use both?

A. Uh-huh.

Q. They can't also use the hundred tons in the

first section?

A. That's correct.

Q. You either have to take the emission limit

or the hours limit?

A. The language says "or". So, either one or

the other.

Q. But within the hours limit, you can use both

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the engine number and the turbine number?

A. That's correct. If the source has both

engines and turbines, they would count those hours

separately.

Q. Very good. Thank you. Moving on to the

section on emission averaging plan, this is Section

217.390, and specifically I'm looking at Section

(a)(2)A.

A. Okay.

Q. This is the provision that talks about what

kind of units may not be included in an averaging

plan, and we understand that a lot of this averaging

plan language is already in the rule from the first

proceeding. We did have some questions from members

that weren't affected by that first proceeding as just

a point of information. What the Agency's rationale

was on choosing January 1st, 2002, a date several

years in the past, for the cutoff of when units in

operation could be included in an averaging plan.

A. Okay. The date stems from the

implementation rule posed or required by USEPA for the

eight-hour standard -- 1997 version of the eight-hour

ozone standard and also the PM2.5 standard of 2002 is

considered a base year, and the base year considers

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the emissions inventory, what the emissions of various

sources in that year as compared to the air quality

levels. You actually measure PM2.5 and ozone levels

that are occurring at this same time. These air

quality levels are the basis for the Chicago area and

the Metro East being non-containment in the first

place. The monitored values were violating the

standards. The idea is you set a base year that is

representative of your monitoring data that considers

air quality exceeding the air quality standards. For

planning purposes, you would compare that inventory to

some future year inventory. In case of ozone and

PM2.5, 2010 is the containment year, where it's levels

of emissions in the non-containment areas must be

reduced from the base year to that future year, such

that we can demonstrate if that future year obtains

the standard. I guess it's kind of a long-winded

answer. We're looking for emission reductions from

that base year. Replacement units that would be

included in an averaging plan that are permitted after

this date could represent an increase in emissions

from the base year rather than a decrease or a holding

status, and we're trying to prevent emission increases

occurring under the averaging plan provision.

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Q. Okay. Thank you for that clarification.

The last area that I had for you, Mr. Kaleel, is

really getting towards the amended second support

document that went in with your submittal this past

December, and specifically what I'm looking at is

what's called Attachment A to that document.

A. Okay. I have it.

Q. Okay. And this attachment has two tables

within it. One is a list of impacted RICE, and the

other page -- the table of impacted turbines. We

wanted to hear from you, Mr. Kaleel, of how you came

about determining which emission units were

represented on this table as being units that would be

impacted by the proposed rule.

A. Okay. First off, the amendment say -- it's

included with the Technical Support Document -- is

intended as an indication of the number of sources

that may be affected or the number of units that may

be affected. It isn't a complete list. There may be

other units that are out there that we're not aware of

or that somehow didn't make it into our emissions

inventory system that would be subject to the rule or

maybe units that are listed here that may qualify for

low usage exemption or other exemption. So, it's

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really our best estimate based on the information that

we have available. We developed these lists based on

our computerized database at the Illinois EPA. The

database, we put a lot of effort into it. We use it

tremendously for funding activities and other

activities at the Agency. We have to admit equally

that it's not a perfect representation of everything

that's out there, and this is really our best

estimate.

Q. So, I think you're acknowledging then that

there are several units that are even permitted by

Illinois EPA right now that meet the applicability

requirements for this proposed rule that aren't listed

here in the table?

A. That's certainly possible.

MS. DRIVER: Okay.

MR. RAO: May I? This relates to what Miss Driver

was asking you. Look at the potentially affected

sources back in the documents on page 38. You

reference some of these sources as potentially

affected, and then you have some which are potentially

impacted by these rules, and it's confusing to me how

you use those terms. Can you clarify it for the

record what you mean by "potentially affected" and

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"potentially impacted"?

A. We perhaps should have been a little more

consistent with our language. I think we intended

those terms to be interchangeable. These may be

sources or units that are affected by the rule

depending on the specific circumstance, how large a

unit, how much they emit, where they're located, etc.

MR. RAO: Okay. Thanks.

MS. DRIVER: Could we just have just a moment to

confer?

HEARING OFFICER FOX: Absolutely.

(A brief recess off the record.)

MS. DRIVER: Thank you for your indulgence.

HEARING OFFICER FOX: No worries at all.

MS. DRIVER: We are done. Thank you so much,

Mr. Kaleel, for your information. We appreciate it.

MR. KALEEL: Okay.

HEARING OFFICER FOX: Miss Driver, thank you for

your questions. Were there other participants here at

the hearing that had questions for either of the

Agency's witnesses? I see Mr. More.

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E X A M I N A T I O N

by Mr. Joshua More:

Q. My name is Josh More. I'm a lawyer from

Schiff Hardin on behalf of NGPO and A and R Pipeline

Company. I was hoping to ask Mr. Kaleel some

questions about applicability, and I wanted to talk

about the hundred ton threshold at the source.

HEARING OFFICER FOX: Mr. More, if I may interrupt

you for a second. We have a fan that's making you

almost inaudible. If you could --

BY MR. MORE:

Q. I was hoping we could start talking about

the applicability threshold, the 100 ton NOx emissions

at a major source. Is it correct that an engine which

is not located at a major source with moderate

non-containment, a source that does not emit 100 tons

of NOx or had the potential to emit 100 tons of NOx

would not be covered by this rule?

A. That's correct.

Q. And the same would hold true for a turbine?

A. That's correct.

Q. Even if they met the same plate threshold

listed in 217.386(a)(2) A and B?

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A. If it's not located at a major source for

NOx, and "major" is defined as a hundred tons per

year, if it is not located at a major source, then the

rule would not apply.

MR. MORE: Thank you.

MR. RAO: May I ask a clarification question? In

the scenario that Mr. More just talked about, if that

engine or turbine by itself emits NOx and has a

potential to emit a hundred tons per year of NOx,

would that be subject to the rule?

A. It would be subject to the rule, although I

could maybe also offer that if the actual emissions

from that engine or turbine were less than a hundred

tons per year, that the company that operates that

engine or turbine could request from the Agency a

federally enforceable emission limitation or

restriction on operations that would alter the

potential to emit a number or value that was less than

a hundred tons, and if they accepted that enforceable

permit, that they could avoid the requirements of the

rule.

MR. RAO: Thank you.

BY MR. MORE:

Keefe Reporting Company

Q. I just want to make sure I understand it.

So, if the source took a synthetic minor and it had an

engine that's seated and maintained the capacity, it

would not be subject to the rule?

A. If they accepted the federally enforceable

emission limits, potential to emit less than a hundred

tons a year, they would not be subject to the rule.

Q. Along those same lines, could you take a

look at page 13 in the PSD -- the amended PSD, Section

2.2? The second to last sentence reads, "If some of

the emissions from all units at a source determines if

a unit is major and not subject to RACT requirements."

Should that read "determines if a source is major"?

A. Yes, you're correct, it should be "source".

Q. Okay. Thanks. Next I was hoping we could

talk a little bit about PSD permitting requirements

that might ensue from certain scenarios, and in

particular it's referenced on page 30 of the Technical

Support Document, the last paragraph.

A. Okay.

Q. Could you describe for me what scenarios

might result in an increase in CO emissions that would

then in turn trigger PSD permitting?

A. I can make a general description on what we

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intended by this paragraph. Specific permitting

questions I probably would want to defer to comments

since we don't have staff from the Illinois EPA permit

section available, but we are aware and I think what

we intended by this TSD is that there are certain

control practices or equipment that could be used on

engines that could -- would have a substantial benefit

in relation to nitrogen oxide emissions, but might

result in an increase of carbon monoxide. So, we

acknowledge that perhaps in some cases there's a

tradeoff. We also acknowledge that in some cases the

carbon monoxide emissions could go up rather

significantly and may trigger -- depending on the size

of the engine or the number of engines, may trigger a

prevention of significant deterioration permit

relative to the emissions increase for CO. So, we are

aware of that.

Q. What control practices are you aware that

would have a benefit with respect to the NOx emissions

that might in turn result in a decrease in CO

emissions?

A. Just a moment. I'll talk with Mr. Mahajan

on this. Looking at the Technical Support Document,

starting on page 23 and continuing on to page 24, we

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are aware of at least one control device or type of

control equipment called a dry low NOx combustor that

may have the effect of increasing carbon monoxide

emissions. The second to last sentence in Section 4.6

entitled "Dry Low NOx Combustors" makes that comment.

So, that might be an example of a controlled device

that would be chosen by a company that could result in

air CO emissions. That's just an example. There may

be others.

Q. Are you familiar with the amount of time it

takes to obtain a PSD permit?

A. I know it's lengthy, but I probably

shouldn't speak to specific schedules. There's

varying degrees of complexities, and sometimes it's

much more complex to get a PSD permit than others.

Q. And what about the cost associated with PSD

permitting?

A. Again, I think I probably have to defer to

the costs. The costs are borne by the applicant, not

by the Agency. There are certain fees involved, but,

you know, I think the cost would vary depending on the

complexity of a PSD permit. I'm sure it's not

insignificant.

Q. And what about the compliance cost

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associated with triggering a PSD, and the compliance

would be you'd have to meet BACT (phonetic) ; is that

correct?

A. That is generally the requirement for

prevention of significant deterioration. BACT

(phonetic) is a case-by-case determination by the

Agency. So, I can't speak to the specific cost for

carbon monoxide. That's something that would be

identified through the permitting process.

Q. Were any of those costs taken into account

in determining the cost for compliance with this rule?

A. We did not account for that, no.

MR. MORE: That's all I have.

HEARING OFFICER FOX: Thanks, Mr. More. Was there

any other participant that had a question or questions

for the Agency's witnesses here this morning?

(No response.)

HEARING OFFICER FOX: I understand that Mr. Rao

does have at least a number of questions. Mr. Rao, we

can turn to you.

MR. RAO: I just wanted to get a clarification

from you on the proposed language for 201.146(i). In

your proposal, you had indicated that the Board should

use whatever was proposed in your first notice. I

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just wanted to make sure that Illinois EPA has seen

that language and whatever it proposes is what it

wants in the rule.

MS. DOCTORS: What I'm looking at is the Board's

Order from May 17th, 2007 on -- Can you hear me?

HEARING OFFICER FOX: Uh-huh.

MS. DOCTORS: On page 7 of your Order, it shows

the language that the Agency proposed and would like

considered.

HEARING OFFICER FOX: And just for the record,

Miss Doctors, that was the May 17th Order in docket

number R07-18 also relating to NOx emissions; correct?

MS. DOCTORS: Yes, it is R07-18.

HEARING OFFICE FOX: Thank you very much.

MR. RAO: Just to keep the proposal together and

all the language in it, would you consider proposing

that language in your errata sheet?

MS. DOCTORS: The Agency would be happy to include

Section 201.156.

MR. RAO: And then I had a couple of questions

relating to some typographical errors that may have

been triggered by the different versions of the rule,

but I thought I'd just ask you to -- or at least point

out those sections so you know which ones we found.

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The first one was in Section 217.388. In the

preamble, it says, "On and after applicable compliance

date in Section 217.392, an owner or operator of an

affected unit must inspect and maintain affected units

as required by subsection C of this section," and I

notice that subsection C deals with low usage units.

I think it should be subsection D, but I wanted the

Agency to take a look at it to see what the correct --

MS. DOCTORS: What I'd like to do is just take a

list of the notations, and I'll respond in comment to

all once I have the correct version to go from.

MR. RAO: And let's see. The next one we found

was in Section 217.394(b). That subsection reads, "An

owner or operator of an engine or turbine must conduct

subsequent performance tests pursuant to subsection

C1, C2 or C3," but when you go to subsection C,

there's only C1 and C2. There's no C3.

MS. DOCTORS: Correct. That's a typo.

MR. RAO: That's a typo. Okay. So, that will be

addressed in your errata sheet?

MS. DOCTORS: Correct.

MR. RAO: Okay. Then I have a couple of questions

relating to the Technical Support Document. Go to

pages 34 and 35. The PSD -- Or the Technical Support

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Document states, "For units included in an averaging

plan and units with continuous emission monitoring

system, compliance with emissions limit must be

demonstrated each year, and for all other units,

compliance will be demonstrated on a periodic basis

using stack tests and portable monitoring systems."

Could you please clarify if "all other units" mean

those that are not exempt from the rules, including

low usage units?

A. (by Mr. Kaleel) I'd be happy to clarify.

The rule requires record keeping by the companies.

So, when we say that compliance would be demonstrated

on a periodic basis, I mean, companies need to be in

compliance with the seasonal requirements and the

annual requirements. I mean, they always have to

comply with that. So, we didn't intend that they only

need to comply on a periodic basis. What we're

indicating here is that for averaging plans, we're

requiring submittal to us of compliance under the

averaging plan every year for both the ozone season

and the annual time frame. Other sources that seek to

comply -- other units -- I'm sorry -- that comply with

the emission limitations and not included in the

averaging plan are required to either use stack tests

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or portable monitoring systems on a periodic basis,

once every five years in the case of stack tests,

annually for the portable monitoring systems. Low

usage units are required to maintain records that

demonstrate that they continue to qualify for that

exemption. So, again, there's various ways of

demonstrating compliance. The companies are supposed

to be able to maintain those records.

MR. RAO: With the five-year testing, is that

what's proposed in Section 217.394 subsection D?

A. Yes.

MS. DOCTORS: Can I ask a clarifying question?

Was it our intent that low usage units would be

required to do periodic monitoring or testing?

A. It is not required that low usage units do

testing or monitoring, unless it's subsequently

determined that they no longer qualify for that

exemption. Those units are required to test if the

Agency requires it or USEPA requires it, but it's not

in the rule that there's a periodic testing or

monitoring requirement for low usage units.

MR. RAO: As long as they provide the record

keeping and document that they're meeting the low

usage criteria?

Keefe Reporting Company

A. Yes. That's correct.

MR. RAO: And page 38 of the TSD, regarding RICE

-- yeah, I think it's the RICE engine, with capacity

between 500 to 1500 brake horsepower, the Agency

estimates 135 units to be potentially affected by

these rules and estimates approximately 8 to be

potentially impacted by the proposal. Could you

please explain?

MS. DOCTORS: The Agency would like to note that

there's a typographical error. That the correct

number was thought to be 175, but it's 79 as presented

in Table 7-1.

HEARING OFFICER FOX: In other words, Miss

Doctors, the table is correct and should supersede the

175 in the text?

MS. DOCTORS: Correct.

HEARING OFFICER FOX: Thank you.

MR. RAO: That was part of my question. So, there

were 79 units considered as potentially affected by

these rules, and they approximate that 8 engines could

be potentially impacted by this proposal. Could you

please explain the rationale for assuming that a large

proportion of the affected engines, you know, not be

impacted by the rules?

Keefe Reporting Company

A. (by Mr. Kaleel) I guess this goes back to

your previous question earlier about "potentially

affected" and "potentially impacted," and I apologize

if I didn't clarify the language properly. What we've

estimated based on surveys is that there could be as

many as 79 engines that are within 500 brake

horsepower and 1500 brake horsepower capacity. We've

made an attempt -- And if a source is in that range

and were operating continuously, their potential to

emit would be significant enough to be affected by the

rule. We've made an attempt to estimate how many of

those engines might meet the applicability criteria.

In other words, whether it's at a hundred ton source

or whether it operates at a level that might be

qualify for an exemption, and as a result of those

calculations, we've determined that we would estimate

8 engines in this size range would be affected by the

rule, would have to comply with the rule.

HEARING OFFICER FOX: Mr. More?

MR. MORE: You say "would have to comply with the

rule". These eight engines -- This is excluding those

engines that would take advantage of one of the

exemptions?

A. That's correct.

Keefe Reporting Company

MR. MORE: So, technically speaking, those engines

that are taking advantage of the exemption are still

subject to the rule?

A. I note the clarification. I'm trying to

determine which source might actually have to -- or

which units might actually have to implement controls.

MR. RAO: That's all I have.

HEARING OFFICER FOX: Do any of the participants,

whether a follow-up by Mr. Driver, Mr. More, any of

the other folks present, have any questions for the

Agency's witnesses here this morning?

MS. DRIVER: I'm sorry. I have one more for

Mr. Kaleel that has come up.

E X A M I N A T I O N

by Ms. LaDonna Driver:

Q. In talking about the universe of units that

can be covered by this rule, and specifically I guess

with engines really, the rule itself is entitled and

speaks in terms of stationary internal combustion

engines. Can you talk a little bit about what the

Agency envisions by that terminology? In other words,

do you envision units that move while they're

operating to be considered stationary and, therefore,

Keefe Reporting Company

subject to this rule?

A. (by Mr. Kaleel) Well, as we discussed

before, if an engine or a turbine operates in a

location within the source or even moves at different

locations within the source, if it meets the other

applicable requirements, then we would intend for the

rule to apply. We're aware of some circumstances

where some engines might move within a source that

might pose some difficulties in terms of testing or

installation of controls, and we are aware that the --

we're not quite sure at this time how to deal with

those circumstances. It may be that there are engines

of that type that should qualify for some sort of a

site specific consideration, but we've not developed

that at this time. So --

Q. Okay. Maybe that's something that we can

continue to develop and work on then.

A. We're always willing to discuss those

issues.

MS. DRIVER: Pardon me.

(A brief recess off the record.)

MS. DRIVER: Thank you very much.

Keefe Reporting Company

HEARING OFFICER FOX: Any further questions on

anybody's part for the Agency?

(No response.)

HEARING OFFICER FOX: Seeing no indication that

anyone does have questions, gentlemen and Miss

Doctors, thank you for your testimony and responses to

the questions and your time. Why don't we proceed,

Miss Driver, if you have no -- I'm sorry. Miss

Doctors, I think we had spoken off the record before

the hearing, the prefiled testimony of the Agency's

two witnesses, of course, is filed with this Board,

and it's admitted into the record at this proceeding

as if read under the Board's rules. It's my

understanding that you did not wish to admit their

prefiled testimony as a hearing exhibit in this

proceeding. Is that correct?

MS. DOCTORS: Yes.

HEARING OFFICER FOX: Thank you very much for

clarifying. Miss Driver, I'm sorry for the

interruption. If you are set, we may turn to

Mr. Wagner for the Municipal Electric Agency. Did you

wish to submit his prefiled testimony into the record

as a hearing exhibit today?

MS. DRIVER: We do not. We, like the Agency, are

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happy to consider it admitted as if read.

HEARING OFFICER FOX: Very well. And if the Court

Reporter then could proceed to swear Mr. Wagner in, we

could turn to perhaps a brief summary that he might

like to offer or otherwise go right to questions that

the Board and the participants may have for him.

MS. DRIVER: Actually, I will just make a couple

really quick points to cover both IMEA and IERG, and

we'll go straight to questions if that's fine.

HEARING OFFICER FOX: Excellent.

MS. DRIVER: We are very pleased to be here today.

We appreciate the opportunity to participate in this

rulemaking on behalf of both IMEA and IERG. We've

been working with the Agency on this rule for a few

years now, and unlike a lot of rules that come before

the Board of emission regulation type, this one in our

view is unique, in that you have a situation where you

have a great diversity of emission units at issue

here, and that happens quite frequently, but in this

case, we have a situation where a lot of the units

that are within the applicability of the rule do not

operate on a consistent basis, unlike a lot of units

that we deal with here. So, for us as the regulated

sources, it was critical that we consider that in how

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the rule development went forward because the way a

unit operates and the frequency and its function has a

great deal to do with what you can do as far as

controls. So, as we worked with the Agency on this

rule, we developed some different compliance options

that we've talked about today, averaging plans, low

use options, and one thing that hasn't been mentioned

so far which is that of NOx allowances in certain

limited compliance situations. Those components of

the rule, both for IMEA and IERG, are critical

components of this rule.

As you can see from the prefiled testimony, we

have not talked about, nor challenged, the level of

the emission limits in the proposed rule, the control

technology that the Agency has focused on for getting

to those limits, nor the costs of those controls, and

the reason is because for the most part we feel that

our membership in both organizations will be able to

find and approach in the rule that works for them as

long as those approaches remain as proposed.

So, with that, we have both the prefiled testimony

of Kevin Wagner from IMEA, as well as Deirdre Hirner

from IERG, and both witnesses are available for

questions. I think we'll begin with Mr. Wagner.

Keefe Reporting Company

HEARING OFFICER FOX: Thank you, Miss Driver. If

the Court Reporter could swear Mr. Wagner in, please.

(At this time, KEVIN WAGNER is sworn in.)

HEARING OFFICER FOX: If there are questions,

we'll proceed to those for Mr. Wagner. Again, if you

are seeking to ask a question for the first time, if

you would just identify yourself by name and any

organization you might represent so that the record is

clear. Is there anyone who wishes to pose a question

to Mr. Wagner?

(No response.)

HEARING OFFICER FOX: I know Mr. Rao has some

questions. Why don't we let him pose those?

MR. RAO: Good morning, Mr. Wagner.

A. Good morning.

MR. RAO: Your prefiled testimony on pages 6 and

7, you provide an example of an emergency situation

based by municipality members without naming the

impacted municipality. Would it be possible to

identify, you know, this affected municipality that

faces an emergency situation?

A. Let's see here. You're looking at --

Keefe Reporting Company

MR. RAO: I was wondering if there's anything --

any information, or is it just --

A. You're referring to the example at the

bottom of page 6?

MR. RAO: And goes on to page 7.

A. The particular member that we were speaking

of is the City of Princeton, Illinois. They are in a

containment area. They are not one of the affected

units that -- Actually, there's five member cities

that are affected by the proposed rule, and they have

similar stories to tell, but we wanted to point out

the example of Princeton as being typical of the kind

of situation we can have when weather conditions

requires to run generation for extended outage.

MR. RAO: These -- You know, Princeton and also

these other five affected units you talk about, are

they all similarly situated in terms of having radio

transmission, or do they have different issues?

A. Yes. Those five are on page 12 in that

little table you'll see of my testimony.

MR. RAO: Okay.

A. At least four of those five have

transmission arrangements that are subject to a single

outage contingency situation that could cause problems

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to supply their peak load. They have weak backup

lines, and they would have to run local generation to

support voltage or prevent overloading of those backup

facilities that they have.

MR. RAO: And the five municipalities that you

list on page 12, those are the ones that are in the

non-containment areas?

A. Yes, these are the ones that are affected by

the proposed ruling.

MR. RAO: Do any of these municipalities have, you

know, plans to make any changes to their transmission

system, or is that a very expensive change to make?

A. Yes, transmission improvements are very

expensive to make, and, of course, right-of-way is a

very difficult thing to obtain. Trying to bring a

transmission line through somebody's backyard is very

difficult. We are, of course, working with the

investor owned utilities, Ameren and those -- and

Exelon who are involved in those areas, to try to

coordinate our planning and put in those improvements

where we can, but those are difficult, and those are

long range projects.

MR. RAO: And of those five municipalities that

are affected by the proposed rule, do all the five

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qualify for this low usage exemption?

A. Yes, all of these cities have units that we

believe exceed the standard that's proposed by the

rule, the emission standard, and we're not sure what

compliance strategy they'll choose, but very likely

they would opt for one of the low usage approaches.

MR. RAO: So, that is a viable option for these?

A. Yes.

MR. RAO: On page 8, you define "low usage unit"

as a unit that make take a collective federal

enforceable emission level of a hundred tons per year

of NOx. Would you clarify whether collective limit is

a source wide limit on potential to emit from all

engines and turbines in that particular source; is

that how you read the exemption to apply?

A. It's my understanding that that 100 tons

would pertain to all of the units in that particular

city.

MR. RAO: Without questions of the Agency, I just

wanted to make sure of that.

E X A M I N A T I O N

by Ms. LaDonna Driver:

Q. Can I follow-up on that? Just as a point of

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clarification, so that we're not confusing

applicability with low usage, if a source wants to

take advantage of the low usage designation and they

want to take the hundred ton per year limit, is it

your understanding, Mr. Wagner, that that limit would

be taken only for those units that are not exempt

under the applicability provision and those units that

are not complying with the emission limits of the

proposed rule?

A. Yes.

MS. DRIVER: Okay.

MR. RAO: You also define a "low usage unit" as a

reciprocating engine with a federally enforceable

limit of 8 million Bhp hours or a turbine with a limit

of 20,000 megawatt hours annually in the aggregate.

Were these thresholds proposed by IMEA to the Agency,

or did they have to come up with those threshold

numbers?

A. I don't recall how those numbers were

developed.

MR. RAO: I wanted to ask you what's the rationale

for those numbers, but, you know, the Agency may jump

in and answer if they know.

A. (by Mr. Kaleel) The concept of using brake

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horsepower hours or megawatt hours was actually

proposed to us by stakeholders. That specific number

or those numbers that are used in the rule was more of

a negotiation. I think the concept is that with brake

horsepower hours or megawatt hours that a small -- a

relatively small unit could operate for a lot of hours

and not trigger that threshold, and the smaller unit

would have fewer emissions. A larger unit would be

allowed fewer hours before it triggered that

requirement because that larger unit would be expected

to have larger emissions. But the values themselves

that are contained in the rules were a result of the

negotiation at stakeholders.

MR. RAO: Thanks for the clarification. I was not

sure because I know you worked with the Agency on this

part of the rule. So -- On Page 10 of your testimony,

you describe the potential impact of the proposed

rules based on applicability of the newer units to

comply with the proposed emission limits. Could you

please clarify whether IMEA or its members have

performed any preliminary monitoring and testing to

determine if the newer units can comply with the

proposed emission limits?

A. (by Mr. Wagner) Our numbers are based on

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what we've seen from manufacturers' information.

There were a few random gas samples taken in the

Waterloo area, but nothing to -- that we could really

reach a conclusion on at this time, but we are

encouraged that from what we've read from

manufacturers' information on some of these new units

that some of them could possibly comply. We're not

certain at this time.

MR. RAO: Okay. On page 11 of your testimony, you

state that NOx allowance provision at Section

217.392(c) addresses emergency response situations

when a low usage unit meets the exceedance limit.

Could you comment on the rationale for limiting the

number of emergency based exceedances to two events

every five years? Is that -- That's what is proposed

in the rules. Is that an adequate, you know, number

of incidents to deal with emergencies?

A. Well, we'd always like to see more, but I

believe this was a number that we felt we could live

with based on experience we've seen -- historical

experience.

MR. RAO: Okay. I just wanted to see if there was

any rationale for that or, you know -- because

emergencies don't occur on a periodic basis.

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HEARING OFFICER FOX: Mr. Kaleel, did you have a

comment on that issue?

A. (by Mr. Kaleel) Yeah. I think the way the

concept was developed in discussions with the

stakeholders, the idea of using NOx Sip call

allowances, it's kind of a novel law that was brought

to us by the stakeholders in the process. The

circumstance that I think that they had in mind was

unforeseen circumstances, unpredictable circumstances

that may cause exceedances of an emission limit or

violations of an emission limit. We -- I guess it

seemed to us that if we have three, four or five

exceedances -- they say for the unforeseen

circumstances occurring every year, well, then maybe

they're more predictable or could be dealt with with

better planning on the part of the units involved.

So, it didn't seem to us that that should be an

unlimited way of complying with the rule, that if

there are circumstances that are frequently occurring,

they almost by definition are unforeseeable. It seems

a better planning on the part of the companies would

be required. We didn't want it to be open-ended.

MR. RAO: You mentioned that this is the first

time the Agency is allowing this kind of an approach

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to -- for affected units to comply with the rules. Is

there any downside to allowing the use of NOx

allowances to come to compliance?

A. (by Mr. Kaleel) Well, I guess the downside

of using the allowances is -- The idea originally came

with the trading program. The federal trading program

is that controlling NOx emissions helps to reduce

ozone or flying particles on a regional basis. That's

why the trading concept came along. It's a little

inconsistent with the idea of reasonably available

control technology, which is a Clean Air Act

requirement for a specific area. So, it's not

necessarily a regional transport issue anymore. It's

a local issue. So, the idea that a company might

comply by using allowances means that maybe they're

not applying controls locally. That would be a

downside. Currently the emission reduction under this

program is to be implemented locally and not

regionally.

MR. RAO: Thank you.

HEARING OFFICER FOX: Member Moore has indicated

that she has no questions, and that Mr. Rao has

exhausted those that he wanted to pose to Mr. Wagner.

Was there any other participant, anyone else here

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present today that had a question for him?

HEARING OFFICER FOX: Miss Driver?

MS. DRIVER: Could I just quickly follow-up on the

last question that was raised about the NOx allowances

and Mr. Kaleel's response on that?

HEARING OFFICER FOX: Please do.

E X A M I N A T I O N

by Ms. LaDonna Driver:

Q. Understanding, Mr. Kaleel, what you just

said about the difference in the RACT emission

regulatory approach and trading, in the sense that in

other RACT-type rules that we have on the books right

now, if a source were to perhaps exceed some of those

limits, the traditional route would be doing what has

to be done to solve that problem, possibly some

enforcement and that sort of thing. The NOx allowance

here option also, does it not, allow for some kind of

fix in the air shed in that same somewhat season and

time, in that to the extent that there has been an

exceedance of NOx emission in the air shed, the source

compensates for that by retiring the same number of

emissions out of the NOx air shed, so there is some

benefit to having that happen at that point in time?

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A. Well, we recognize there would be some

benefit to it. I guess in general in a trading

program, all of the states or the entire region that

participates in that program would see some benefit,

but it's conceivable that the NOx allowance that a

source might surrender to cover a compliance option

under this rule that that allowance may have been due

to an emission reduction that happened in a state

that's a long way away. So, in some cases -- It is

kind of theoretical. It wouldn't necessarily yield a

benefit in this air shed. It would yield a benefit

regionally -- somebody's air shed in the area that's

covered by the trading program.

Q. Somebody's benefitting?

A. Somebody would get a corresponding benefit.

It may not be in the same air shed.

Q. Thank you.

A. We do recognize the circumstances of the

operators of the engines and turbines that what

they're required to do with those engines and

turbines, there may be unforeseen circumstances. We

certainly recognize that, which is why we included

this.

MS. DRIVER: Thank you.

Keefe Reporting Company

HEARING OFFICER FOX: Anything further, Miss

Driver?

(No response.)

HEARING OFFICER FOX: Mr. Wagner, it appears that

no one else had any questions for you. Thank you for

your prefiled testimony and your answers here today.

It's appreciated on behalf of the Board and the staff.

Miss Driver, as we are making progress through the

prefiled testimony, would it be appropriate to simply

go directly to Miss Hirner?

MS. DRIVER: Yes.

HEARING OFFICER FOX: I suspect having not wished

to admit Mr. Wagner's prefiled testimony as an

exhibit, that that would apply, as well, to Miss

Hirner. Of course, it's already in the record.

MS. DRIVER: That's correct, it will be admitted

as if read.

HEARING OFFICER FOX: If the Court Reporter would

swear Miss Hirner in, we'll turn to her and any

questions both you may have of her.

(At this time, DEIRDRE HIRNER is sworn in.)

HEARING OFFICER FOX: Miss Hirner, why don't we

Keefe Reporting Company

turn to questions? Is there anyone on the part of the

Agency, any of the other participants that would have

a question they wish to pose to her?

MS. DOCTORS: No questions at this time.

HEARING OFFICER FOX: Miss Doctors, thank you. I

think Mr. Rao has a question.

MR. RAO: Miss Hirner, on page 3 of your prefiled

testimony, you state that IERG has non-attainment area

members with units which are not listed in Attachment

A that would be affected by this proposed rule. Does

IERG have such information as to how many additional

units would be affected by the proposed rules?

A. (by Ms. Hirner) I have an idea of the

number of members who may have units that would be

affected by the rule, and I think our issue goes to

what "affected" means. For example, my members are

all Title 5 sources, and some of the members who are

in this Title 5 area have sources -- or have units

that would now in their permits be noted as

insignificant units. However, when this rule comes

into play, those insignificant units, in order to --

will not necessarily have to have NOx controls placed

on those units, but for those insignificant units will

have to take a federally enforceable limit and then

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will have to do some monitoring to ensure that they

comply with those federally enforceable limits as

stated. So, when we look to being affected by the

rule, while not having to place specific controls on

those units, they will be affected in that they will

have to do some revisions to the permitting, and that

they will have to do some monitoring activities. And,

so, for example, Abbott Laboratories would be one in

the Chicago non-attainment areas that has a unit that

will be affected by the rule in that regard.

MR. RAO: Okay. Since some of these units are not

part of the Agency's analysis in the TSD, do you take

issue with any of their, you know, conclusions based

on the impact of the rules in terms of the costs?

A. I'm not -- Could you clarify your question?

MR. RAO: What I was saying is, you stated that a

few of these -- your members have these units affected

by these rules which are not considered by the Agency

in their Technical Support Document and in their

analysis. So, my question was, because the Agency

didn't consider those units, do you have any issues

with the Agency's conclusions on the economic impact

of the rules, or should they have looked at, you know,

some of these insignificant units that would be also

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affected by the rules?

A. With regard to, let's say, additional

permitting costs, I don't think that I have the

information at hand to answer that at this time, but

I'd be glad to address that in comment if you want me

to.

MR. RAO: If you think it's a significant impact

by the proposed rules on these sources, it would be

helpful to the Board if you could provide that

information either in comment or the next hearing.

A. Okay. I can do that.

MR. RAO: Thank you. That's all I have.

HEARING OFFICER FOX: Are there any further

questions for Ms. Hirner? Mrs. Doctors?

E X A M I N A T I O N

by Ms. Rachel L. Doctors:

Q. Yes. I just want to clarify your answer in

which you'd said there would be additional monitoring

in order to comply with the federal enforceable limit.

Now, you're talking about the periodic-type monitoring

requirements for Title 5, not monitoring requirements

as stated in our rule?

A. Correct.

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Q. Which could be different and less stringent

and less frequent; is that correct?

A. Correct.

MS. DOCTORS: Thank you.

HEARING OFFICER FOX: Anything further, Miss

Doctors?

MS. DOCTORS: No.

HEARING OFFICER FOX: Were there any other

questions for Miss Hirner?

(No response.)

HEARING OFFICER FOX: Seeing none, Miss Hirner,

thanks to you, as well, for your prefiled testimony

and for your answers here today and your help to the

Board for building its record.

There is a sign-in sheet at this podium for folks

who wish to provide testimony who had not prefiled it

in advance of today's hearing. I see clearly that no

one has signed up. Is there anyone else here today

who did wish to be sworn in and offer any testimony on

the Agency's amended proposal?

(No response.)

HEARING OFFICER FOX: Neither seeing, nor hearing

any, we can turn to some housekeeping details and more

toward adjournment. If anyone wishes to do so, they

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may file written public comments with the Board's

clerk in this proceedings. Those dates of filing the

comments may be made electronically through the

clerk's office on-line or the COOL system, and any

questions about that procedure of electronic filing

should be directed to the clerk's office, where they

can provide help on the technical aspects of that.

Filings with the Board, whether they're on paper

or electronic must also be served on the hearing

officer and those whose names appear on the service

list in this proceeding and before filing with the

clerk. You may reach me at 312-814-6085 or at the

e-mail address foxt@ipcb.state.il.us. If you did not

get those as I ran through them quickly, they'll

appear in the transcript, and they're also in the

notice of hearings that are posted on the Board's web

site under this docket number. That contact will make

sure you have the most current service list.

The Court Reporter indicates that copies of the

transcripts of this hearing today should be available

to the Board by April 15th, and very soon after those

transcripts are received, they would be posted on the

Board's web site, where they can be read, downloaded

and printed off free of charge at any time, again,

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under this docket number, R07-19.

The second hearing in this proceeding is now

scheduled to take place beginning Wednesday, May 7th.

I believe that's exactly four weeks from today. It

will begin at 11:00 a.m. in Chicago. And the deadline

for prefiling testimony for that, again according to

the notice of hearing, is on Wednesday, April 23rd.

If anyone has questions about those procedural

aspects, such as prefiling, they may certainly reach

me through the phone number or the e-mail address that

I provided, and that is available on the Board's web

site.

One other issue I wish to bring up quickly, the

Board on the agenda of its regularly scheduled meeting

next Thursday, April 17th has in this docket an order

directing the clerk to withdraw from first notice

publication the original proposal that was published

in the Illinois Register in June of 2007. Having

granted the Agency's motion to proceed with the

amended testimony, it was the Board's conclusion that

that had in effect been superseded. In the interest

of trying to eliminate any risk of confusion or

misunderstanding, the Board will move forward to

withdraw that from first notice so that any subsequent

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first notice and any order it wishes to issue in this

proceeding will take place that much more clearly

hopefully.

Are there any other questions or any other matters

procedurally that need to be addressed at this time?

(No response.)

HEARING OFFICER FOX: Hearing no response, I'll

restate thanks on behalf of the Board and the rest of

its staff. We very much appreciate your time and

travel in being here today and, of course, for your

prefiled testimony and your assistance in answering

questions. And with that, we can adjourn for today.

And we will -- I suspect to see many of you in Chicago

on Wednesday, May 7th. Thanks once again.

(Hearing adjourned.)

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STATE OF ILLINOIS

)

COUNTY OF ST. CLAIR )

I, HOLLY A. McCULLOUGH, a Notary Public

within and for the County of St. Clair, State of

Illinois, do HEREBY CERTIFY that the foregoing record

was made before me on April 9, 2008, at the Madison

County Administration Building, Room 203, 157 North

Main Street, Edwardsville, Illinois.

IN WITNESS WHEREOF, I have hereunto set my

hand and affixed my Notarial Seal the 10th day of

April, 2008.

_____________________________

HOLLY A. McCULLOUGH

Notary Public

CSR #084-004265

RPR #821968

CCR #1011

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