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BEFORE THE ILLINOIS POLLUTION CONTROL BOARD
2
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IN THE MATTER OF:
)
)
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SECTION 27 PROPOSED
)
RULES FOR NITROGEN OXIDE )
5
(NOx) EMISSIONS FROM
) R07-19
STATIONARY RECIPROCATING ) (Rulemaking - Air)
6
INTERNAL COMBUSTION
)
ENGINES AND TURBINES:
)
7
AMENDMENTS TO 35 ILL.
)
ADM. CODE PARTS 211 AND )
8
217.
)
9
10
11
Proceedings held on April 9, 2008, at 9:00 a.m., at
12
the Madison County Administration Building, Room 203,
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157 North Main Street, Edwardsville, Illinois, before
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Timothy J. Fox, Hearing Officer.
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18
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Reported by Holly A. McCullough,
C.S.R., C.C.R., R.P.R.
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KEEFE REPORTING COMPANY
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Eleven North 44th Street
Belleville, IL 62226
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(618) 277-0190
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APPEARANCES:
2
Timothy J. Fox
3
Hearing Officer
Illinois Pollution Control Board
4
100 West Randolph Street, Suite 11-500
Chicago, IL 60601
5
Andrea Moore
6
Attending Board Member
Illinois Pollution Control Board
7
100 West Randolph Street, Suite 11-500
Chicago, IL 60601
8
Anand Rao
9
Senior Environmental Scientist
Illinois Pollution Control Board
10
100 West Randolph Street, Suite 11-500
Chicago, IL 60601
11
Rachel L. Doctors
12
Illinois Environmental Protection Agency
1021 North Grand Avenue East
13
P. O. Box 19276
Springfield, IL 62794-9276
14
Also present from the Illinois Environmental
15
Protection Agency:
Robert J. Kaleel
16
and Yoginder Mahajan
17
For Illinois Municipal Electric Agency (IMEA) and
For Illinois Environmental Regulatory Group (IERG):
18
N. LaDonna Driver
Hodge, Dwyer, Zeman
19
3150 Roland Avenue
P. O. Box 5776
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Springfield, IL 62705-5776
21
Also present for IMEA:
Kevin Wagner
22
Also present for IERG:
23
Deirdre K. Hirner
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APPEARANCES CONT.:
2
Also present
Joshua R. More
3
Schiff Harden, LLP
6600 Sears Tower
4
Chicago, IL 60606
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6
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INDEX OF EXHIBITS:
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IEPA Exhibit No. 1 -- Page 8-9
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(IEPA Exhibit No. 1 is attached hereto.)
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INTERROGATION INDEX:
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Opening Remarks -- Page 4
Opening Comments by Ms. Doctors -- Page 7
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Questions of Mr. Kaleel by Ms. Driver -- Page 12
Questions of Mr. Kaleel by Mr. More -- Page 27
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Questions of Mr. Kaleel by Mr. Rao -- Page 32
Questions of Mr. Kaleel by Ms. Driver -- Page 39
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Comments by Ms Driver -- Page 42
Questions of Mr. Wagner by Mr. Rao -- Page 44
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Questions of Mr. Wagner by Ms. Driver -- Page 47
Questions of Mr. Wagner by Mr. Rao -- Page 48
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Questions of Mr. Kaleel by Ms. Driver -- Page 53
Questions of Ms. Hirner by Mr. Rao -- Page 56
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Questions of Ms. Hirner by Ms. Driver -- Page 58
Closing Remarks -- Page 59
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PROCEEDINGS:
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(April 9, 2008, 9:00 a.m.)
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4
HEARING OFFICER FOX: Good morning and welcome to
5
this Illinois Pollution Control Board hearing. My
6
name is Tim Fox, and I'm the Hearing Officer for this
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rulemaking, which is entitled "Section 27 Proposed
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Rules For Nitrogen Oxide Emissions From Stationary
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Reciprocating Internal Combustion Engines and
10
Turbines: Amendments to 35 Illinois Administrative
11
Code Parts 211 and 217". The Board docket number for
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this rulemaking is R07-19.
13
In an Order dated January 10th of 2008, the Board
14
granted the Illinois Environmental Protection Agency's
15
motion to proceed with an amended proposal and
16
directed the Hearing Officer to proceed to hearing.
17
Also present from the Board today are to my left
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Board Member Andrea Moore, who is the lead Board
19
member for this rulemaking, as well as to my right
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Anand Rao of the Board's technical staff. Member
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Moore, did you wish to make any remarks at this time?
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MS. MOORE: Careful what you whisper. The
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microphone is on. And welcome all, and we appreciate
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the amount of time and effort that's gone into
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producing this rule and look forward to getting a good
2
record.
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HEARING OFFICER FOX: Very well. Today we are, of
4
course, holding the first hearing in this rulemaking.
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The second hearing is now scheduled to take place
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beginning Wednesday, May 7th, 2008 in Chicago. More
7
details about that are in the notice of hearings that
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are posted on the Board's web site under this docket
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number.
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This proceeding is governed by the Board's
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procedural rules, under which all information that is
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relevant and is not repetitious or privileged will be
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admitted into the record. Please note that any
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questions today that are posed either by the Board
15
member or by the Board staff are intended solely to
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insist in developing clear and complete record and do
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not reflect any prejudgment on the merit of this
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proposal that's before the Board.
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For this first hearing, the Board on March 26th,
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2008 received prefiled testimony from the Illinois
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Environmental Protection Agency by Mr. Yoginder
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Mahajan and from Mr. Robert Kaleel. On the same date,
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the Board also received prefiled testimony from the
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Illinois Municipal Electric Agency or IMEA by
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Mr. Kevin Wagner, and also on March 26th, the Board
2
received prefiled testimony from the Illinois
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Environmental Regulatory Group or IERG, often
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pronounced IERG, by Miss Deirdre Hirner. We will
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begin this hearing, of course, with that prefiled
6
testimony, and we'll hear first from the witnesses
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from the IEPA, which is, of course, the proponent in
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this proceeding, and this will be followed by
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questions that others present may have for the
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Agency's witnesses. We will then turn at Miss
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Drivers' direction to Mr. Wagner for his testimony,
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which will also be followed by any questions of those
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participants here today may have for him, and then
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also at Miss Drivers' direction we'll then turn to
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Miss Hirner for the testimony on behalf of IERG,
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followed, of course, by questions the participants may
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have.
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While I know that you are all veterans of these
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kind of proceedings, for the benefit of our Court
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Reporter, please speak clearly, and, if you would,
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please avoid talking at the same time as any other
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participant here. That would certainly help her to
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transcribe this and for us to have a transcript that
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is as clear as possible.
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Are there any questions before we move forward
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with the Agency's witnesses?
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(No response.)
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HEARING OFFICER FOX: Very well. Having spoken
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off the record with Miss Doctors before the hearing,
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it was her intention I believe, and she'll correct me,
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that she wish to have the Agency's two witnesses sworn
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in together, and that they did not have any kind of
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remarks to offer, and that they would be prepared to
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move directly to questions. Is that correct, Miss
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Doctors?
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MS. DOCTORS: That's correct. And I have a couple
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of comments I'd like to make on the record before we
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start with questions.
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HEARING OFFICER FOX: This seems like as good a
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time as any if you want to pose those.
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MS. DOCTORS: On behalf of the Director, I'd like
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to thank the Board for its consideration for this
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rulemaking proposal and it's opportunity to provide
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testimony in support of R07-19. As Mr. Fox just
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mentioned, we're going to go straight to questions.
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I would like to note that on March 24th, 2008,
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this EPA issued a SIP call to all states with ozone
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non-containment areas that had failed to submit
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complete RACT SIPs. Illinois is such a state. The
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Federal Register began an 18 month sanction of the
3
law. If Illinois does not submit the complete RACT
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SIP by August, 2009, the offset sanction will apply,
5
which concerns emissions for modified or new
6
construction in non-containment areas, and if we do
7
not submit within 24 months, timely sanctions would
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apply.
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I've given each participant a copy of this Federal
10
Register, and I'd like that to be admitted into the
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record.
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HEARING OFFICER FOX: Ms. Doctors, just for the
13
sake of clarity, that is the Federal Register, Volume
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73, page 15416, the title "Findings of Failure to
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Submit State Implementation Plans Required for the
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1997 8-hour ozone NAAQS". Do I have the correct
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document?
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MS. DOCTORS: Yes.
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HEARING OFFICER FOX: And did I hear a motion to
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admit that as hearing Exhibit No. 1.
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MS. DOCTORS: Yes.
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HEARING OFFICER FOX: Is there any objection to
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the motion to admit that as Exhibit 1?
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(No response.)
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HEARING OFFICER FOX: Neither seeing, nor hearing
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any, it will be marked and admitted as Exhibit 1. Ms.
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Doctors, thank you.
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MS. DOCTORS: And the second comment, I'd like to
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note that I found some typographical errors --
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typographical errors have been brought to my attention
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by both Miss Driver and Mr. More, and we're waiting
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for the Board to tell us which is the correct document
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that's been published to use for identifying which set
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of typographical errors the Agency should submit as an
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errata sheet. The Agency would like to do this at the
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second hearing if possible.
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And, also, the Agency would note that IERG has
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proposed an amendment that concerns offsets that they
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agree with, and that would be part of that sheet
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showing some changes to the rule at the second
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hearing.
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MS. DRIVER: That's correct.
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OFFICER HEARING FOX: Again, just for sake of
20
clarity -- I'm sorry to interrupt you -- I believe
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Miss Hirner's pretrial testimony included specific
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language proposed for that very issue; is that
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correct?
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MS. DOCTORS: Correct. And the Agency is in
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agreement with that language. I was just going to put
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it all together in one document.
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HEARING OFFICER FOX: Thank you for clarification.
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And if I may jump back -- and I'm sorry to interrupt
5
you again -- the Board appreciates your notice,
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Mr. More's notice and Miss Driver's notice that there
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were apparently some discrepancies between different
8
versions of the rule, and we will expeditiously see,
9
with your help gracefully, where those are and how
10
they arose at the earliest possible opportunity and
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let you and the other participants know precisely
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which version you can safely rely upon with the Board
13
in proposing various changes in an errata sheet or
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otherwise. So, thank you all for bearing on that. We
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work at resolving that as quickly as possible.
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MS. DOCTORS: Thank you. The other thing the
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Agency would like to know is that Section 201.146 is
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also being amended, even though it's not in this title
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of this -- in R07-19, that that had been part of the
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Board's earlier order that they would remove it from
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R07-18 to R07-19 to that amendment. Is that correct?
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HEARING OFFICER FOX: I believe that was part of
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the original proposal filed in March or April of '07.
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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
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we'll have a brief question about your intentions for
3
that language in this proceeding, but it sounds like
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you are suggesting that you may wish to amend the
5
caption to reflect the fact that there would be
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language in 201.146, if I recall correctly, that would
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be opened up and amended in this proceeding.
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MS. DOCTORS: Correct.
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HEARING OFFICER FOX: Very good. We'll certainly
10
take note of that, and I appreciate you placing it on
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the record.
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MS. DOCTORS: I'd like now to open it up for
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questions to my witnesses.
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HEARING OFFICER FOX: If I could just ask -- and,
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again, apologies for the interruption -- were there
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any other procedural questions or any other issues
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that any of the participants wish to raise?
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(No response.)
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HEARING OFFICER FOX: Very good. If you're set,
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Miss Doctors, I'll have the Court Reporter swear in
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your two witnesses and proceed then.
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(At this time, ROBERT KALEEL and YOGINDER MAHAJAN
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are sworn in.)
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HEARING OFFICER FOX: And having been sworn in,
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both Mr. Kaleel and Mr. Mahajan on behalf of the
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Agency are available for any questions. If anyone has
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a question that they'd like to pose, please just raise
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your hand so I may recognize you, and on the first
6
recognition, if you would just state your name and any
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organization that you may represent for the benefit of
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the Court Reporter and the record, that would be much
9
appreciated. Any questions for either of the
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gentlemen? Miss Driver?
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MS. DRIVER: Thank you, Mr. Fox. My name is
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LaDonna Driver. I'm an attorney here today for two
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entities, the Illinois Municipal Electric Agency,
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which I'll call IMEA for short, and the Illinois
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Environmental Regulatory Group, which I'll call IERG
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for short. Thank you for the opportunity to be here
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and participate in this rulemaking.
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E X A M I N A T I O N
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by Ms. LaDonna Driver:
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Q. I have just a few questions for Mr. Kaleel,
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and they are basically just to clarify a few things in
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the ruling and in the prefiled testimony. The first
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question that I have, Mr. Kaleel, is in the
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applicability section of the rules, which is Section
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217.386, and I'm specifically looking at the
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exemptions, (b)(5), this is the exemption that has
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commonly been called the portable unit exemption or
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mobile unit exemption. Let me know, Mr. Kaleel, when
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you've got it in front of you.
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A. I found that section.
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Q. Okay. Great. Just a couple of questions
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that some of our members were wanting some
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clarification on this provision. Could you provide
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some insight as to why the Agency chose to cap this
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exemption at 1500 horsepower for engines?
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A. I guess I really don't recall what the
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rationale for the 1500 was at this time. I think the
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1500 is considered a significant emission unit for our
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purposes. I guess I need to defer to comments if I
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could at this time as to rationale for the 1500.
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Q. Certainly. That would be fine. The other
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thing that we were interested in on this provision is
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that it seems to get to the concept of mobile units
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being or portable units not really being considered a
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stationary unit that's subject to this rule. Are we
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right about that provision?
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A. That's right.
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Q. Okay. The language that you have towards
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the end of this provision is that it has to move to a
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different source at least once every 12 months. We
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understand the term "source" to mean something in air
5
regulations. Can you talk a little bit about -- Does
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the Agency truly envision that in order for this
7
provision to apply that you physically would move it
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to a different Clean Air Act source every 12 months?
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A. That is our intent. We are aware that
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people use engines for a lot of different purposes,
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and in many cases if they remain in a particular
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source, then they are truly stationary. There are
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other people that use engines that perhaps move them
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from site to site on a very frequent basis, and it's
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very difficult for us to track those or permit those
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or to be able to have knowledge of where those are at
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all times. Sometimes they may move them within a
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non-containment area and then move them outside the
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non-containment area. These are typically not real
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large engines that are used for that purpose. We
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didn't intend to regulate those. But the engines that
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are at a source, even if they're perhaps moved within
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the locations within the source, we did intend,
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provided that they're not exempt.
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Q. So, just so I understand what you're saying,
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Mr. Kaleel, if a company wants to move its unit within
3
its one source facility, is it your position then that
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this provision does not apply because it has not moved
5
to a different Clean Air Act source, different
6
facility? Do you understand my question?
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A. Well, maybe you could ask it again.
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Q. Sure. What I'm getting at is the situation
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where a source has an engine that could move within
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that source. It could move to one production building
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and be used for some spot power needs there, and then
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maybe in a few months they need it at a different
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production building at that same source -- permitted
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source. Is that the kind of situation that you
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envision this exemption covering? They're not leaving
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the permitted source. They're moving around within
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that permitted source.
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A. Thank you for clarifying your question.
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That is more what we had in mind. If that engine or
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turbine is located at a particular source, that
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engine, provided that it meet the other applicability
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requirements, that that engine would be affected.
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Q. Okay. So, even if they are physically
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moving the unit around at that source, you do not
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intend for this exemption to apply?
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A. That's right.
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Q. Okay. Does that movement within that source
4
make the unit any less mobile? I guess I'm trying to
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understanding the distinction in your mind on
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exempting something that's moving around within a
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source as opposed to it just moving across the road to
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another source from a control standpoint.
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A. I guess I can't envision a situation where
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somebody would move it right across the road, but
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we're really thinking of things like construction
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sites or perhaps asphalt plants that are movable and
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mobile. They're not going to be in the same general
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location for any significant length of time. It's
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difficult to regulate units like that, difficult to
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track them, to inspect them on a regular basis or
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routine basis.
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Q. Well, thank you for offering to provide us a
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little bit more information on the levels that you're
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looking at in this provision. We'll move on from here
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on that.
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A. Okay.
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Q. The other provision that I wanted to ask you
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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
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me. Section 217.388(c).
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MS. DOCTORS: At the bottom of page 3?
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MS. DRIVER: Yes.
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A. Okay.
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BY MS. DRIVER:
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Q. This is I think what we've commonly called
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the low usage compliance option?
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A. Yes.
11
Q. And in looking at your prefiled testimony,
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specifically on page 6 of your prefiled testimony --
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A. Okay.
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Q. -- in the top paragraph on that page, you
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talk about towards the end of that paragraph low usage
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units, and in the next to the last sentence of that
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paragraph, you state here that one provision of low
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usage units from all engines and turbines at a source
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are below a hundred ton per year of NOx emission.
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Could you talk about the scope of that statement in
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comparison to the provision of Section 217.388(b)(1)?
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And what I'm getting at here is the statement in your
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prefiled statement that "all engines and turbines at a
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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
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specifically which units you count in that hundred ton
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per year limit and which ones do not count.
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A. Okay. Yes, we have to clarify. I think
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perhaps in my prefiled testimony I was a little too
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general or too informal and were not precise enough in
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the way I worded that. What would count towards the
8
hundred tons per year or what we're asking the company
9
to do is to compute for us the potentials from that
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distinguished from actual emissions. The potentials
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would consider a unit that might operate continuously,
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and many of the engines that we are -- or units, not
13
just engines, turbines -- do not operate continuously.
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So, we've written into the rule that if the company
15
was to accept limit potentials would emit less than a
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hundred tons per year of aggregating all engines and
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turbines located at a source that aren't otherwise
18
exempt, so that would limit our exemptions and
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applicability criteria, and those would not count
20
towards the PTE calculation and also other units that
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are otherwise in compliance with the emission limits
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contained within the rule. So, it's just certain
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units that would count towards the PTE calculation,
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and it wasn't intended as being broad as I
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characterized it in my testimony.
2
Q. Very good.
3
MR. RAO: May I ask a follow up? You also have a
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hundred tons per year of NOx emission criteria under
5
Section 217.386(a)(2)?
6
A. Yes.
7
Q. Basically that section states for engines to
8
be subjected to this rule, they're supposed to emit or
9
put out -- potentially emitting NOx in an amount equal
10
to or greater than a hundred tons per year?
11
A. Yes.
12
MR. RAO: When you say "emission of NOx to be
13
equal to or greater than a hundred tons per year on
14
that source," that's NOx from the engines and
15
turbines, or are there any other NOx emissions that
16
can also be calculated in that?
17
A. In the applicability section, 386(a)2), it
18
could refer to any emission units that emits NOx at a
19
source. So, if they --
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MR. RAO: If there's a major source of NOx, if
21
somebody's engine is meeting the criteria that you
22
have under subsection (a)(2) A and B, they are subject
23
to the rules?
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A. They are subject to the rule. And
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distinguishing the intent of that law is from the one
2
that Ms. Driver was asking about, this is specifically
3
for a low usage exemption for engines that might be
4
within a source that has other types of emission
5
units, whether it's boilers or process sources. I'm
6
trying to distinguish low usage from any general
7
applicability of a hundred tons per year.
8
MR. RAO: Thank you.
9
HEARING OFFICER FOX: Thank you.
10
11
BY MS. DRIVER:
12
Q. And then following up on that, Rob --
13
Mr. Kaleel, for those engines or turbines that would
14
meet one of the ruling exemptions, they would not get
15
counted towards that hundred ton low usage
16
designation?
17
A. That's correct.
18
Q. And if a source has certain units, engines
19
and turbines that it decides can comply with the
20
proposed rules emission limits, those also do not get
21
counted towards the hundred ton per year limit?
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A. That's correct.
23
Q. Very good. Thank you for that
24
clarification. While we're on the low usage
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provision, just one more point to clarify here. The
2
hundred ton per year provision that we were just
3
looking at is in (c)(1), but then there's an operating
4
hour low usage designation in (c)(2), and it's broken
5
down to accommodate both engines and turbines, and
6
(2)A is engines, and (2)B is turbines. It's our
7
understanding, Mr. Kaleel, that the Agency intends
8
that if a source wants to take advantage of the low
9
use designation and they have engines and turbines,
10
not just one or the other, that they could take
11
advantage of the 8 million horsepower hours for their
12
engines in (c)(2)A, as well as the 20,000 megawatt
13
hours for turbines in (2)B, that they could use both?
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A. They can use both.
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Q. They can use both?
16
A. Uh-huh.
17
Q. They can't also use the hundred tons in the
18
first section?
19
A. That's correct.
20
Q. You either have to take the emission limit
21
or the hours limit?
22
A. The language says "or". So, either one or
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the other.
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Q. But within the hours limit, you can use both
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the engine number and the turbine number?
2
A. That's correct. If the source has both
3
engines and turbines, they would count those hours
4
separately.
5
Q. Very good. Thank you. Moving on to the
6
section on emission averaging plan, this is Section
7
217.390, and specifically I'm looking at Section
8
(a)(2)A.
9
A. Okay.
10
Q. This is the provision that talks about what
11
kind of units may not be included in an averaging
12
plan, and we understand that a lot of this averaging
13
plan language is already in the rule from the first
14
proceeding. We did have some questions from members
15
that weren't affected by that first proceeding as just
16
a point of information. What the Agency's rationale
17
was on choosing January 1st, 2002, a date several
18
years in the past, for the cutoff of when units in
19
operation could be included in an averaging plan.
20
A. Okay. The date stems from the
21
implementation rule posed or required by USEPA for the
22
eight-hour standard -- 1997 version of the eight-hour
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ozone standard and also the PM2.5 standard of 2002 is
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considered a base year, and the base year considers
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the emissions inventory, what the emissions of various
2
sources in that year as compared to the air quality
3
levels. You actually measure PM2.5 and ozone levels
4
that are occurring at this same time. These air
5
quality levels are the basis for the Chicago area and
6
the Metro East being non-containment in the first
7
place. The monitored values were violating the
8
standards. The idea is you set a base year that is
9
representative of your monitoring data that considers
10
air quality exceeding the air quality standards. For
11
planning purposes, you would compare that inventory to
12
some future year inventory. In case of ozone and
13
PM2.5, 2010 is the containment year, where it's levels
14
of emissions in the non-containment areas must be
15
reduced from the base year to that future year, such
16
that we can demonstrate if that future year obtains
17
the standard. I guess it's kind of a long-winded
18
answer. We're looking for emission reductions from
19
that base year. Replacement units that would be
20
included in an averaging plan that are permitted after
21
this date could represent an increase in emissions
22
from the base year rather than a decrease or a holding
23
status, and we're trying to prevent emission increases
24
occurring under the averaging plan provision.
23
Keefe Reporting Company
1
Q. Okay. Thank you for that clarification.
2
The last area that I had for you, Mr. Kaleel, is
3
really getting towards the amended second support
4
document that went in with your submittal this past
5
December, and specifically what I'm looking at is
6
what's called Attachment A to that document.
7
A. Okay. I have it.
8
Q. Okay. And this attachment has two tables
9
within it. One is a list of impacted RICE, and the
10
other page -- the table of impacted turbines. We
11
wanted to hear from you, Mr. Kaleel, of how you came
12
about determining which emission units were
13
represented on this table as being units that would be
14
impacted by the proposed rule.
15
A. Okay. First off, the amendment say -- it's
16
included with the Technical Support Document -- is
17
intended as an indication of the number of sources
18
that may be affected or the number of units that may
19
be affected. It isn't a complete list. There may be
20
other units that are out there that we're not aware of
21
or that somehow didn't make it into our emissions
22
inventory system that would be subject to the rule or
23
maybe units that are listed here that may qualify for
24
low usage exemption or other exemption. So, it's
24
Keefe Reporting Company
1
really our best estimate based on the information that
2
we have available. We developed these lists based on
3
our computerized database at the Illinois EPA. The
4
database, we put a lot of effort into it. We use it
5
tremendously for funding activities and other
6
activities at the Agency. We have to admit equally
7
that it's not a perfect representation of everything
8
that's out there, and this is really our best
9
estimate.
10
Q. So, I think you're acknowledging then that
11
there are several units that are even permitted by
12
Illinois EPA right now that meet the applicability
13
requirements for this proposed rule that aren't listed
14
here in the table?
15
A. That's certainly possible.
16
MS. DRIVER: Okay.
17
MR. RAO: May I? This relates to what Miss Driver
18
was asking you. Look at the potentially affected
19
sources back in the documents on page 38. You
20
reference some of these sources as potentially
21
affected, and then you have some which are potentially
22
impacted by these rules, and it's confusing to me how
23
you use those terms. Can you clarify it for the
24
record what you mean by "potentially affected" and
25
Keefe Reporting Company
1
"potentially impacted"?
2
A. We perhaps should have been a little more
3
consistent with our language. I think we intended
4
those terms to be interchangeable. These may be
5
sources or units that are affected by the rule
6
depending on the specific circumstance, how large a
7
unit, how much they emit, where they're located, etc.
8
MR. RAO: Okay. Thanks.
9
MS. DRIVER: Could we just have just a moment to
10
confer?
11
HEARING OFFICER FOX: Absolutely.
12
13
(A brief recess off the record.)
14
15
MS. DRIVER: Thank you for your indulgence.
16
HEARING OFFICER FOX: No worries at all.
17
MS. DRIVER: We are done. Thank you so much,
18
Mr. Kaleel, for your information. We appreciate it.
19
MR. KALEEL: Okay.
20
HEARING OFFICER FOX: Miss Driver, thank you for
21
your questions. Were there other participants here at
22
the hearing that had questions for either of the
23
Agency's witnesses? I see Mr. More.
24
26
Keefe Reporting Company
1
E X A M I N A T I O N
2
by Mr. Joshua More:
3
Q. My name is Josh More. I'm a lawyer from
4
Schiff Hardin on behalf of NGPO and A and R Pipeline
5
Company. I was hoping to ask Mr. Kaleel some
6
questions about applicability, and I wanted to talk
7
about the hundred ton threshold at the source.
8
HEARING OFFICER FOX: Mr. More, if I may interrupt
9
you for a second. We have a fan that's making you
10
almost inaudible. If you could --
11
12
BY MR. MORE:
13
Q. I was hoping we could start talking about
14
the applicability threshold, the 100 ton NOx emissions
15
at a major source. Is it correct that an engine which
16
is not located at a major source with moderate
17
non-containment, a source that does not emit 100 tons
18
of NOx or had the potential to emit 100 tons of NOx
19
would not be covered by this rule?
20
A. That's correct.
21
Q. And the same would hold true for a turbine?
22
A. That's correct.
23
Q. Even if they met the same plate threshold
24
listed in 217.386(a)(2) A and B?
27
Keefe Reporting Company
1
A. If it's not located at a major source for
2
NOx, and "major" is defined as a hundred tons per
3
year, if it is not located at a major source, then the
4
rule would not apply.
5
MR. MORE: Thank you.
6
MR. RAO: May I ask a clarification question? In
7
the scenario that Mr. More just talked about, if that
8
engine or turbine by itself emits NOx and has a
9
potential to emit a hundred tons per year of NOx,
10
would that be subject to the rule?
11
A. It would be subject to the rule, although I
12
could maybe also offer that if the actual emissions
13
from that engine or turbine were less than a hundred
14
tons per year, that the company that operates that
15
engine or turbine could request from the Agency a
16
federally enforceable emission limitation or
17
restriction on operations that would alter the
18
potential to emit a number or value that was less than
19
a hundred tons, and if they accepted that enforceable
20
permit, that they could avoid the requirements of the
21
rule.
22
MR. RAO: Thank you.
23
24
BY MR. MORE:
28
Keefe Reporting Company
1
Q. I just want to make sure I understand it.
2
So, if the source took a synthetic minor and it had an
3
engine that's seated and maintained the capacity, it
4
would not be subject to the rule?
5
A. If they accepted the federally enforceable
6
emission limits, potential to emit less than a hundred
7
tons a year, they would not be subject to the rule.
8
Q. Along those same lines, could you take a
9
look at page 13 in the PSD -- the amended PSD, Section
10
2.2? The second to last sentence reads, "If some of
11
the emissions from all units at a source determines if
12
a unit is major and not subject to RACT requirements."
13
Should that read "determines if a source is major"?
14
A. Yes, you're correct, it should be "source".
15
Q. Okay. Thanks. Next I was hoping we could
16
talk a little bit about PSD permitting requirements
17
that might ensue from certain scenarios, and in
18
particular it's referenced on page 30 of the Technical
19
Support Document, the last paragraph.
20
A. Okay.
21
Q. Could you describe for me what scenarios
22
might result in an increase in CO emissions that would
23
then in turn trigger PSD permitting?
24
A. I can make a general description on what we
29
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1
intended by this paragraph. Specific permitting
2
questions I probably would want to defer to comments
3
since we don't have staff from the Illinois EPA permit
4
section available, but we are aware and I think what
5
we intended by this TSD is that there are certain
6
control practices or equipment that could be used on
7
engines that could -- would have a substantial benefit
8
in relation to nitrogen oxide emissions, but might
9
result in an increase of carbon monoxide. So, we
10
acknowledge that perhaps in some cases there's a
11
tradeoff. We also acknowledge that in some cases the
12
carbon monoxide emissions could go up rather
13
significantly and may trigger -- depending on the size
14
of the engine or the number of engines, may trigger a
15
prevention of significant deterioration permit
16
relative to the emissions increase for CO. So, we are
17
aware of that.
18
Q. What control practices are you aware that
19
would have a benefit with respect to the NOx emissions
20
that might in turn result in a decrease in CO
21
emissions?
22
A. Just a moment. I'll talk with Mr. Mahajan
23
on this. Looking at the Technical Support Document,
24
starting on page 23 and continuing on to page 24, we
30
Keefe Reporting Company
1
are aware of at least one control device or type of
2
control equipment called a dry low NOx combustor that
3
may have the effect of increasing carbon monoxide
4
emissions. The second to last sentence in Section 4.6
5
entitled "Dry Low NOx Combustors" makes that comment.
6
So, that might be an example of a controlled device
7
that would be chosen by a company that could result in
8
air CO emissions. That's just an example. There may
9
be others.
10
Q. Are you familiar with the amount of time it
11
takes to obtain a PSD permit?
12
A. I know it's lengthy, but I probably
13
shouldn't speak to specific schedules. There's
14
varying degrees of complexities, and sometimes it's
15
much more complex to get a PSD permit than others.
16
Q. And what about the cost associated with PSD
17
permitting?
18
A. Again, I think I probably have to defer to
19
the costs. The costs are borne by the applicant, not
20
by the Agency. There are certain fees involved, but,
21
you know, I think the cost would vary depending on the
22
complexity of a PSD permit. I'm sure it's not
23
insignificant.
24
Q. And what about the compliance cost
31
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1
associated with triggering a PSD, and the compliance
2
would be you'd have to meet BACT (phonetic) ; is that
3
correct?
4
A. That is generally the requirement for
5
prevention of significant deterioration. BACT
6
(phonetic) is a case-by-case determination by the
7
Agency. So, I can't speak to the specific cost for
8
carbon monoxide. That's something that would be
9
identified through the permitting process.
10
Q. Were any of those costs taken into account
11
in determining the cost for compliance with this rule?
12
A. We did not account for that, no.
13
MR. MORE: That's all I have.
14
HEARING OFFICER FOX: Thanks, Mr. More. Was there
15
any other participant that had a question or questions
16
for the Agency's witnesses here this morning?
17
(No response.)
18
HEARING OFFICER FOX: I understand that Mr. Rao
19
does have at least a number of questions. Mr. Rao, we
20
can turn to you.
21
MR. RAO: I just wanted to get a clarification
22
from you on the proposed language for 201.146(i). In
23
your proposal, you had indicated that the Board should
24
use whatever was proposed in your first notice. I
32
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1
just wanted to make sure that Illinois EPA has seen
2
that language and whatever it proposes is what it
3
wants in the rule.
4
MS. DOCTORS: What I'm looking at is the Board's
5
Order from May 17th, 2007 on -- Can you hear me?
6
HEARING OFFICER FOX: Uh-huh.
7
MS. DOCTORS: On page 7 of your Order, it shows
8
the language that the Agency proposed and would like
9
considered.
10
HEARING OFFICER FOX: And just for the record,
11
Miss Doctors, that was the May 17th Order in docket
12
number R07-18 also relating to NOx emissions; correct?
13
MS. DOCTORS: Yes, it is R07-18.
14
HEARING OFFICE FOX: Thank you very much.
15
MR. RAO: Just to keep the proposal together and
16
all the language in it, would you consider proposing
17
that language in your errata sheet?
18
MS. DOCTORS: The Agency would be happy to include
19
Section 201.156.
20
MR. RAO: And then I had a couple of questions
21
relating to some typographical errors that may have
22
been triggered by the different versions of the rule,
23
but I thought I'd just ask you to -- or at least point
24
out those sections so you know which ones we found.
33
Keefe Reporting Company
1
The first one was in Section 217.388. In the
2
preamble, it says, "On and after applicable compliance
3
date in Section 217.392, an owner or operator of an
4
affected unit must inspect and maintain affected units
5
as required by subsection C of this section," and I
6
notice that subsection C deals with low usage units.
7
I think it should be subsection D, but I wanted the
8
Agency to take a look at it to see what the correct --
9
MS. DOCTORS: What I'd like to do is just take a
10
list of the notations, and I'll respond in comment to
11
all once I have the correct version to go from.
12
MR. RAO: And let's see. The next one we found
13
was in Section 217.394(b). That subsection reads, "An
14
owner or operator of an engine or turbine must conduct
15
subsequent performance tests pursuant to subsection
16
C1, C2 or C3," but when you go to subsection C,
17
there's only C1 and C2. There's no C3.
18
MS. DOCTORS: Correct. That's a typo.
19
MR. RAO: That's a typo. Okay. So, that will be
20
addressed in your errata sheet?
21
MS. DOCTORS: Correct.
22
MR. RAO: Okay. Then I have a couple of questions
23
relating to the Technical Support Document. Go to
24
pages 34 and 35. The PSD -- Or the Technical Support
34
Keefe Reporting Company
1
Document states, "For units included in an averaging
2
plan and units with continuous emission monitoring
3
system, compliance with emissions limit must be
4
demonstrated each year, and for all other units,
5
compliance will be demonstrated on a periodic basis
6
using stack tests and portable monitoring systems."
7
Could you please clarify if "all other units" mean
8
those that are not exempt from the rules, including
9
low usage units?
10
A. (by Mr. Kaleel) I'd be happy to clarify.
11
The rule requires record keeping by the companies.
12
So, when we say that compliance would be demonstrated
13
on a periodic basis, I mean, companies need to be in
14
compliance with the seasonal requirements and the
15
annual requirements. I mean, they always have to
16
comply with that. So, we didn't intend that they only
17
need to comply on a periodic basis. What we're
18
indicating here is that for averaging plans, we're
19
requiring submittal to us of compliance under the
20
averaging plan every year for both the ozone season
21
and the annual time frame. Other sources that seek to
22
comply -- other units -- I'm sorry -- that comply with
23
the emission limitations and not included in the
24
averaging plan are required to either use stack tests
35
Keefe Reporting Company
1
or portable monitoring systems on a periodic basis,
2
once every five years in the case of stack tests,
3
annually for the portable monitoring systems. Low
4
usage units are required to maintain records that
5
demonstrate that they continue to qualify for that
6
exemption. So, again, there's various ways of
7
demonstrating compliance. The companies are supposed
8
to be able to maintain those records.
9
MR. RAO: With the five-year testing, is that
10
what's proposed in Section 217.394 subsection D?
11
A. Yes.
12
MS. DOCTORS: Can I ask a clarifying question?
13
Was it our intent that low usage units would be
14
required to do periodic monitoring or testing?
15
A. It is not required that low usage units do
16
testing or monitoring, unless it's subsequently
17
determined that they no longer qualify for that
18
exemption. Those units are required to test if the
19
Agency requires it or USEPA requires it, but it's not
20
in the rule that there's a periodic testing or
21
monitoring requirement for low usage units.
22
MR. RAO: As long as they provide the record
23
keeping and document that they're meeting the low
24
usage criteria?
36
Keefe Reporting Company
1
A. Yes. That's correct.
2
MR. RAO: And page 38 of the TSD, regarding RICE
3
-- yeah, I think it's the RICE engine, with capacity
4
between 500 to 1500 brake horsepower, the Agency
5
estimates 135 units to be potentially affected by
6
these rules and estimates approximately 8 to be
7
potentially impacted by the proposal. Could you
8
please explain?
9
MS. DOCTORS: The Agency would like to note that
10
there's a typographical error. That the correct
11
number was thought to be 175, but it's 79 as presented
12
in Table 7-1.
13
HEARING OFFICER FOX: In other words, Miss
14
Doctors, the table is correct and should supersede the
15
175 in the text?
16
MS. DOCTORS: Correct.
17
HEARING OFFICER FOX: Thank you.
18
MR. RAO: That was part of my question. So, there
19
were 79 units considered as potentially affected by
20
these rules, and they approximate that 8 engines could
21
be potentially impacted by this proposal. Could you
22
please explain the rationale for assuming that a large
23
proportion of the affected engines, you know, not be
24
impacted by the rules?
37
Keefe Reporting Company
1
A. (by Mr. Kaleel) I guess this goes back to
2
your previous question earlier about "potentially
3
affected" and "potentially impacted," and I apologize
4
if I didn't clarify the language properly. What we've
5
estimated based on surveys is that there could be as
6
many as 79 engines that are within 500 brake
7
horsepower and 1500 brake horsepower capacity. We've
8
made an attempt -- And if a source is in that range
9
and were operating continuously, their potential to
10
emit would be significant enough to be affected by the
11
rule. We've made an attempt to estimate how many of
12
those engines might meet the applicability criteria.
13
In other words, whether it's at a hundred ton source
14
or whether it operates at a level that might be
15
qualify for an exemption, and as a result of those
16
calculations, we've determined that we would estimate
17
8 engines in this size range would be affected by the
18
rule, would have to comply with the rule.
19
HEARING OFFICER FOX: Mr. More?
20
MR. MORE: You say "would have to comply with the
21
rule". These eight engines -- This is excluding those
22
engines that would take advantage of one of the
23
exemptions?
24
A. That's correct.
38
Keefe Reporting Company
1
MR. MORE: So, technically speaking, those engines
2
that are taking advantage of the exemption are still
3
subject to the rule?
4
A. I note the clarification. I'm trying to
5
determine which source might actually have to -- or
6
which units might actually have to implement controls.
7
MR. RAO: That's all I have.
8
HEARING OFFICER FOX: Do any of the participants,
9
whether a follow-up by Mr. Driver, Mr. More, any of
10
the other folks present, have any questions for the
11
Agency's witnesses here this morning?
12
MS. DRIVER: I'm sorry. I have one more for
13
Mr. Kaleel that has come up.
14
15
E X A M I N A T I O N
16
by Ms. LaDonna Driver:
17
Q. In talking about the universe of units that
18
can be covered by this rule, and specifically I guess
19
with engines really, the rule itself is entitled and
20
speaks in terms of stationary internal combustion
21
engines. Can you talk a little bit about what the
22
Agency envisions by that terminology? In other words,
23
do you envision units that move while they're
24
operating to be considered stationary and, therefore,
39
Keefe Reporting Company
1
subject to this rule?
2
A. (by Mr. Kaleel) Well, as we discussed
3
before, if an engine or a turbine operates in a
4
location within the source or even moves at different
5
locations within the source, if it meets the other
6
applicable requirements, then we would intend for the
7
rule to apply. We're aware of some circumstances
8
where some engines might move within a source that
9
might pose some difficulties in terms of testing or
10
installation of controls, and we are aware that the --
11
we're not quite sure at this time how to deal with
12
those circumstances. It may be that there are engines
13
of that type that should qualify for some sort of a
14
site specific consideration, but we've not developed
15
that at this time. So --
16
Q. Okay. Maybe that's something that we can
17
continue to develop and work on then.
18
A. We're always willing to discuss those
19
issues.
20
MS. DRIVER: Pardon me.
21
22
(A brief recess off the record.)
23
24
MS. DRIVER: Thank you very much.
40
Keefe Reporting Company
1
HEARING OFFICER FOX: Any further questions on
2
anybody's part for the Agency?
3
(No response.)
4
HEARING OFFICER FOX: Seeing no indication that
5
anyone does have questions, gentlemen and Miss
6
Doctors, thank you for your testimony and responses to
7
the questions and your time. Why don't we proceed,
8
Miss Driver, if you have no -- I'm sorry. Miss
9
Doctors, I think we had spoken off the record before
10
the hearing, the prefiled testimony of the Agency's
11
two witnesses, of course, is filed with this Board,
12
and it's admitted into the record at this proceeding
13
as if read under the Board's rules. It's my
14
understanding that you did not wish to admit their
15
prefiled testimony as a hearing exhibit in this
16
proceeding. Is that correct?
17
MS. DOCTORS: Yes.
18
HEARING OFFICER FOX: Thank you very much for
19
clarifying. Miss Driver, I'm sorry for the
20
interruption. If you are set, we may turn to
21
Mr. Wagner for the Municipal Electric Agency. Did you
22
wish to submit his prefiled testimony into the record
23
as a hearing exhibit today?
24
MS. DRIVER: We do not. We, like the Agency, are
41
Keefe Reporting Company
1
happy to consider it admitted as if read.
2
HEARING OFFICER FOX: Very well. And if the Court
3
Reporter then could proceed to swear Mr. Wagner in, we
4
could turn to perhaps a brief summary that he might
5
like to offer or otherwise go right to questions that
6
the Board and the participants may have for him.
7
MS. DRIVER: Actually, I will just make a couple
8
really quick points to cover both IMEA and IERG, and
9
we'll go straight to questions if that's fine.
10
HEARING OFFICER FOX: Excellent.
11
MS. DRIVER: We are very pleased to be here today.
12
We appreciate the opportunity to participate in this
13
rulemaking on behalf of both IMEA and IERG. We've
14
been working with the Agency on this rule for a few
15
years now, and unlike a lot of rules that come before
16
the Board of emission regulation type, this one in our
17
view is unique, in that you have a situation where you
18
have a great diversity of emission units at issue
19
here, and that happens quite frequently, but in this
20
case, we have a situation where a lot of the units
21
that are within the applicability of the rule do not
22
operate on a consistent basis, unlike a lot of units
23
that we deal with here. So, for us as the regulated
24
sources, it was critical that we consider that in how
42
Keefe Reporting Company
1
the rule development went forward because the way a
2
unit operates and the frequency and its function has a
3
great deal to do with what you can do as far as
4
controls. So, as we worked with the Agency on this
5
rule, we developed some different compliance options
6
that we've talked about today, averaging plans, low
7
use options, and one thing that hasn't been mentioned
8
so far which is that of NOx allowances in certain
9
limited compliance situations. Those components of
10
the rule, both for IMEA and IERG, are critical
11
components of this rule.
12
As you can see from the prefiled testimony, we
13
have not talked about, nor challenged, the level of
14
the emission limits in the proposed rule, the control
15
technology that the Agency has focused on for getting
16
to those limits, nor the costs of those controls, and
17
the reason is because for the most part we feel that
18
our membership in both organizations will be able to
19
find and approach in the rule that works for them as
20
long as those approaches remain as proposed.
21
So, with that, we have both the prefiled testimony
22
of Kevin Wagner from IMEA, as well as Deirdre Hirner
23
from IERG, and both witnesses are available for
24
questions. I think we'll begin with Mr. Wagner.
43
Keefe Reporting Company
1
HEARING OFFICER FOX: Thank you, Miss Driver. If
2
the Court Reporter could swear Mr. Wagner in, please.
3
4
(At this time, KEVIN WAGNER is sworn in.)
5
6
HEARING OFFICER FOX: If there are questions,
7
we'll proceed to those for Mr. Wagner. Again, if you
8
are seeking to ask a question for the first time, if
9
you would just identify yourself by name and any
10
organization you might represent so that the record is
11
clear. Is there anyone who wishes to pose a question
12
to Mr. Wagner?
13
(No response.)
14
HEARING OFFICER FOX: I know Mr. Rao has some
15
questions. Why don't we let him pose those?
16
MR. RAO: Good morning, Mr. Wagner.
17
A. Good morning.
18
MR. RAO: Your prefiled testimony on pages 6 and
19
7, you provide an example of an emergency situation
20
based by municipality members without naming the
21
impacted municipality. Would it be possible to
22
identify, you know, this affected municipality that
23
faces an emergency situation?
24
A. Let's see here. You're looking at --
44
Keefe Reporting Company
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MR. RAO: I was wondering if there's anything --
2
any information, or is it just --
3
A. You're referring to the example at the
4
bottom of page 6?
5
MR. RAO: And goes on to page 7.
6
A. The particular member that we were speaking
7
of is the City of Princeton, Illinois. They are in a
8
containment area. They are not one of the affected
9
units that -- Actually, there's five member cities
10
that are affected by the proposed rule, and they have
11
similar stories to tell, but we wanted to point out
12
the example of Princeton as being typical of the kind
13
of situation we can have when weather conditions
14
requires to run generation for extended outage.
15
MR. RAO: These -- You know, Princeton and also
16
these other five affected units you talk about, are
17
they all similarly situated in terms of having radio
18
transmission, or do they have different issues?
19
A. Yes. Those five are on page 12 in that
20
little table you'll see of my testimony.
21
MR. RAO: Okay.
22
A. At least four of those five have
23
transmission arrangements that are subject to a single
24
outage contingency situation that could cause problems
45
Keefe Reporting Company
1
to supply their peak load. They have weak backup
2
lines, and they would have to run local generation to
3
support voltage or prevent overloading of those backup
4
facilities that they have.
5
MR. RAO: And the five municipalities that you
6
list on page 12, those are the ones that are in the
7
non-containment areas?
8
A. Yes, these are the ones that are affected by
9
the proposed ruling.
10
MR. RAO: Do any of these municipalities have, you
11
know, plans to make any changes to their transmission
12
system, or is that a very expensive change to make?
13
A. Yes, transmission improvements are very
14
expensive to make, and, of course, right-of-way is a
15
very difficult thing to obtain. Trying to bring a
16
transmission line through somebody's backyard is very
17
difficult. We are, of course, working with the
18
investor owned utilities, Ameren and those -- and
19
Exelon who are involved in those areas, to try to
20
coordinate our planning and put in those improvements
21
where we can, but those are difficult, and those are
22
long range projects.
23
MR. RAO: And of those five municipalities that
24
are affected by the proposed rule, do all the five
46
Keefe Reporting Company
1
qualify for this low usage exemption?
2
A. Yes, all of these cities have units that we
3
believe exceed the standard that's proposed by the
4
rule, the emission standard, and we're not sure what
5
compliance strategy they'll choose, but very likely
6
they would opt for one of the low usage approaches.
7
MR. RAO: So, that is a viable option for these?
8
A. Yes.
9
MR. RAO: On page 8, you define "low usage unit"
10
as a unit that make take a collective federal
11
enforceable emission level of a hundred tons per year
12
of NOx. Would you clarify whether collective limit is
13
a source wide limit on potential to emit from all
14
engines and turbines in that particular source; is
15
that how you read the exemption to apply?
16
A. It's my understanding that that 100 tons
17
would pertain to all of the units in that particular
18
city.
19
MR. RAO: Without questions of the Agency, I just
20
wanted to make sure of that.
21
22
E X A M I N A T I O N
23
by Ms. LaDonna Driver:
24
Q. Can I follow-up on that? Just as a point of
47
Keefe Reporting Company
1
clarification, so that we're not confusing
2
applicability with low usage, if a source wants to
3
take advantage of the low usage designation and they
4
want to take the hundred ton per year limit, is it
5
your understanding, Mr. Wagner, that that limit would
6
be taken only for those units that are not exempt
7
under the applicability provision and those units that
8
are not complying with the emission limits of the
9
proposed rule?
10
A. Yes.
11
MS. DRIVER: Okay.
12
MR. RAO: You also define a "low usage unit" as a
13
reciprocating engine with a federally enforceable
14
limit of 8 million Bhp hours or a turbine with a limit
15
of 20,000 megawatt hours annually in the aggregate.
16
Were these thresholds proposed by IMEA to the Agency,
17
or did they have to come up with those threshold
18
numbers?
19
A. I don't recall how those numbers were
20
developed.
21
MR. RAO: I wanted to ask you what's the rationale
22
for those numbers, but, you know, the Agency may jump
23
in and answer if they know.
24
A. (by Mr. Kaleel) The concept of using brake
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Keefe Reporting Company
1
horsepower hours or megawatt hours was actually
2
proposed to us by stakeholders. That specific number
3
or those numbers that are used in the rule was more of
4
a negotiation. I think the concept is that with brake
5
horsepower hours or megawatt hours that a small -- a
6
relatively small unit could operate for a lot of hours
7
and not trigger that threshold, and the smaller unit
8
would have fewer emissions. A larger unit would be
9
allowed fewer hours before it triggered that
10
requirement because that larger unit would be expected
11
to have larger emissions. But the values themselves
12
that are contained in the rules were a result of the
13
negotiation at stakeholders.
14
MR. RAO: Thanks for the clarification. I was not
15
sure because I know you worked with the Agency on this
16
part of the rule. So -- On Page 10 of your testimony,
17
you describe the potential impact of the proposed
18
rules based on applicability of the newer units to
19
comply with the proposed emission limits. Could you
20
please clarify whether IMEA or its members have
21
performed any preliminary monitoring and testing to
22
determine if the newer units can comply with the
23
proposed emission limits?
24
A. (by Mr. Wagner) Our numbers are based on
49
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1
what we've seen from manufacturers' information.
2
There were a few random gas samples taken in the
3
Waterloo area, but nothing to -- that we could really
4
reach a conclusion on at this time, but we are
5
encouraged that from what we've read from
6
manufacturers' information on some of these new units
7
that some of them could possibly comply. We're not
8
certain at this time.
9
MR. RAO: Okay. On page 11 of your testimony, you
10
state that NOx allowance provision at Section
11
217.392(c) addresses emergency response situations
12
when a low usage unit meets the exceedance limit.
13
Could you comment on the rationale for limiting the
14
number of emergency based exceedances to two events
15
every five years? Is that -- That's what is proposed
16
in the rules. Is that an adequate, you know, number
17
of incidents to deal with emergencies?
18
A. Well, we'd always like to see more, but I
19
believe this was a number that we felt we could live
20
with based on experience we've seen -- historical
21
experience.
22
MR. RAO: Okay. I just wanted to see if there was
23
any rationale for that or, you know -- because
24
emergencies don't occur on a periodic basis.
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HEARING OFFICER FOX: Mr. Kaleel, did you have a
2
comment on that issue?
3
A. (by Mr. Kaleel) Yeah. I think the way the
4
concept was developed in discussions with the
5
stakeholders, the idea of using NOx Sip call
6
allowances, it's kind of a novel law that was brought
7
to us by the stakeholders in the process. The
8
circumstance that I think that they had in mind was
9
unforeseen circumstances, unpredictable circumstances
10
that may cause exceedances of an emission limit or
11
violations of an emission limit. We -- I guess it
12
seemed to us that if we have three, four or five
13
exceedances -- they say for the unforeseen
14
circumstances occurring every year, well, then maybe
15
they're more predictable or could be dealt with with
16
better planning on the part of the units involved.
17
So, it didn't seem to us that that should be an
18
unlimited way of complying with the rule, that if
19
there are circumstances that are frequently occurring,
20
they almost by definition are unforeseeable. It seems
21
a better planning on the part of the companies would
22
be required. We didn't want it to be open-ended.
23
MR. RAO: You mentioned that this is the first
24
time the Agency is allowing this kind of an approach
51
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to -- for affected units to comply with the rules. Is
2
there any downside to allowing the use of NOx
3
allowances to come to compliance?
4
A. (by Mr. Kaleel) Well, I guess the downside
5
of using the allowances is -- The idea originally came
6
with the trading program. The federal trading program
7
is that controlling NOx emissions helps to reduce
8
ozone or flying particles on a regional basis. That's
9
why the trading concept came along. It's a little
10
inconsistent with the idea of reasonably available
11
control technology, which is a Clean Air Act
12
requirement for a specific area. So, it's not
13
necessarily a regional transport issue anymore. It's
14
a local issue. So, the idea that a company might
15
comply by using allowances means that maybe they're
16
not applying controls locally. That would be a
17
downside. Currently the emission reduction under this
18
program is to be implemented locally and not
19
regionally.
20
MR. RAO: Thank you.
21
HEARING OFFICER FOX: Member Moore has indicated
22
that she has no questions, and that Mr. Rao has
23
exhausted those that he wanted to pose to Mr. Wagner.
24
Was there any other participant, anyone else here
52
Keefe Reporting Company
1
present today that had a question for him?
2
HEARING OFFICER FOX: Miss Driver?
3
MS. DRIVER: Could I just quickly follow-up on the
4
last question that was raised about the NOx allowances
5
and Mr. Kaleel's response on that?
6
HEARING OFFICER FOX: Please do.
7
8
E X A M I N A T I O N
9
by Ms. LaDonna Driver:
10
Q. Understanding, Mr. Kaleel, what you just
11
said about the difference in the RACT emission
12
regulatory approach and trading, in the sense that in
13
other RACT-type rules that we have on the books right
14
now, if a source were to perhaps exceed some of those
15
limits, the traditional route would be doing what has
16
to be done to solve that problem, possibly some
17
enforcement and that sort of thing. The NOx allowance
18
here option also, does it not, allow for some kind of
19
fix in the air shed in that same somewhat season and
20
time, in that to the extent that there has been an
21
exceedance of NOx emission in the air shed, the source
22
compensates for that by retiring the same number of
23
emissions out of the NOx air shed, so there is some
24
benefit to having that happen at that point in time?
53
Keefe Reporting Company
1
A. Well, we recognize there would be some
2
benefit to it. I guess in general in a trading
3
program, all of the states or the entire region that
4
participates in that program would see some benefit,
5
but it's conceivable that the NOx allowance that a
6
source might surrender to cover a compliance option
7
under this rule that that allowance may have been due
8
to an emission reduction that happened in a state
9
that's a long way away. So, in some cases -- It is
10
kind of theoretical. It wouldn't necessarily yield a
11
benefit in this air shed. It would yield a benefit
12
regionally -- somebody's air shed in the area that's
13
covered by the trading program.
14
Q. Somebody's benefitting?
15
A. Somebody would get a corresponding benefit.
16
It may not be in the same air shed.
17
Q. Thank you.
18
A. We do recognize the circumstances of the
19
operators of the engines and turbines that what
20
they're required to do with those engines and
21
turbines, there may be unforeseen circumstances. We
22
certainly recognize that, which is why we included
23
this.
24
MS. DRIVER: Thank you.
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Keefe Reporting Company
1
HEARING OFFICER FOX: Anything further, Miss
2
Driver?
3
(No response.)
4
HEARING OFFICER FOX: Mr. Wagner, it appears that
5
no one else had any questions for you. Thank you for
6
your prefiled testimony and your answers here today.
7
It's appreciated on behalf of the Board and the staff.
8
Miss Driver, as we are making progress through the
9
prefiled testimony, would it be appropriate to simply
10
go directly to Miss Hirner?
11
MS. DRIVER: Yes.
12
HEARING OFFICER FOX: I suspect having not wished
13
to admit Mr. Wagner's prefiled testimony as an
14
exhibit, that that would apply, as well, to Miss
15
Hirner. Of course, it's already in the record.
16
MS. DRIVER: That's correct, it will be admitted
17
as if read.
18
HEARING OFFICER FOX: If the Court Reporter would
19
swear Miss Hirner in, we'll turn to her and any
20
questions both you may have of her.
21
22
(At this time, DEIRDRE HIRNER is sworn in.)
23
24
HEARING OFFICER FOX: Miss Hirner, why don't we
55
Keefe Reporting Company
1
turn to questions? Is there anyone on the part of the
2
Agency, any of the other participants that would have
3
a question they wish to pose to her?
4
MS. DOCTORS: No questions at this time.
5
HEARING OFFICER FOX: Miss Doctors, thank you. I
6
think Mr. Rao has a question.
7
MR. RAO: Miss Hirner, on page 3 of your prefiled
8
testimony, you state that IERG has non-attainment area
9
members with units which are not listed in Attachment
10
A that would be affected by this proposed rule. Does
11
IERG have such information as to how many additional
12
units would be affected by the proposed rules?
13
A. (by Ms. Hirner) I have an idea of the
14
number of members who may have units that would be
15
affected by the rule, and I think our issue goes to
16
what "affected" means. For example, my members are
17
all Title 5 sources, and some of the members who are
18
in this Title 5 area have sources -- or have units
19
that would now in their permits be noted as
20
insignificant units. However, when this rule comes
21
into play, those insignificant units, in order to --
22
will not necessarily have to have NOx controls placed
23
on those units, but for those insignificant units will
24
have to take a federally enforceable limit and then
56
Keefe Reporting Company
1
will have to do some monitoring to ensure that they
2
comply with those federally enforceable limits as
3
stated. So, when we look to being affected by the
4
rule, while not having to place specific controls on
5
those units, they will be affected in that they will
6
have to do some revisions to the permitting, and that
7
they will have to do some monitoring activities. And,
8
so, for example, Abbott Laboratories would be one in
9
the Chicago non-attainment areas that has a unit that
10
will be affected by the rule in that regard.
11
MR. RAO: Okay. Since some of these units are not
12
part of the Agency's analysis in the TSD, do you take
13
issue with any of their, you know, conclusions based
14
on the impact of the rules in terms of the costs?
15
A. I'm not -- Could you clarify your question?
16
MR. RAO: What I was saying is, you stated that a
17
few of these -- your members have these units affected
18
by these rules which are not considered by the Agency
19
in their Technical Support Document and in their
20
analysis. So, my question was, because the Agency
21
didn't consider those units, do you have any issues
22
with the Agency's conclusions on the economic impact
23
of the rules, or should they have looked at, you know,
24
some of these insignificant units that would be also
57
Keefe Reporting Company
1
affected by the rules?
2
A. With regard to, let's say, additional
3
permitting costs, I don't think that I have the
4
information at hand to answer that at this time, but
5
I'd be glad to address that in comment if you want me
6
to.
7
MR. RAO: If you think it's a significant impact
8
by the proposed rules on these sources, it would be
9
helpful to the Board if you could provide that
10
information either in comment or the next hearing.
11
A. Okay. I can do that.
12
MR. RAO: Thank you. That's all I have.
13
HEARING OFFICER FOX: Are there any further
14
questions for Ms. Hirner? Mrs. Doctors?
15
16
E X A M I N A T I O N
17
by Ms. Rachel L. Doctors:
18
Q. Yes. I just want to clarify your answer in
19
which you'd said there would be additional monitoring
20
in order to comply with the federal enforceable limit.
21
Now, you're talking about the periodic-type monitoring
22
requirements for Title 5, not monitoring requirements
23
as stated in our rule?
24
A. Correct.
58
Keefe Reporting Company
1
Q. Which could be different and less stringent
2
and less frequent; is that correct?
3
A. Correct.
4
MS. DOCTORS: Thank you.
5
HEARING OFFICER FOX: Anything further, Miss
6
Doctors?
7
MS. DOCTORS: No.
8
HEARING OFFICER FOX: Were there any other
9
questions for Miss Hirner?
10
(No response.)
11
HEARING OFFICER FOX: Seeing none, Miss Hirner,
12
thanks to you, as well, for your prefiled testimony
13
and for your answers here today and your help to the
14
Board for building its record.
15
There is a sign-in sheet at this podium for folks
16
who wish to provide testimony who had not prefiled it
17
in advance of today's hearing. I see clearly that no
18
one has signed up. Is there anyone else here today
19
who did wish to be sworn in and offer any testimony on
20
the Agency's amended proposal?
21
(No response.)
22
HEARING OFFICER FOX: Neither seeing, nor hearing
23
any, we can turn to some housekeeping details and more
24
toward adjournment. If anyone wishes to do so, they
59
Keefe Reporting Company
1
may file written public comments with the Board's
2
clerk in this proceedings. Those dates of filing the
3
comments may be made electronically through the
4
clerk's office on-line or the COOL system, and any
5
questions about that procedure of electronic filing
6
should be directed to the clerk's office, where they
7
can provide help on the technical aspects of that.
8
Filings with the Board, whether they're on paper
9
or electronic must also be served on the hearing
10
officer and those whose names appear on the service
11
list in this proceeding and before filing with the
12
clerk. You may reach me at 312-814-6085 or at the
13
e-mail address foxt@ipcb.state.il.us. If you did not
14
get those as I ran through them quickly, they'll
15
appear in the transcript, and they're also in the
16
notice of hearings that are posted on the Board's web
17
site under this docket number. That contact will make
18
sure you have the most current service list.
19
The Court Reporter indicates that copies of the
20
transcripts of this hearing today should be available
21
to the Board by April 15th, and very soon after those
22
transcripts are received, they would be posted on the
23
Board's web site, where they can be read, downloaded
24
and printed off free of charge at any time, again,
60
Keefe Reporting Company
1
under this docket number, R07-19.
2
The second hearing in this proceeding is now
3
scheduled to take place beginning Wednesday, May 7th.
4
I believe that's exactly four weeks from today. It
5
will begin at 11:00 a.m. in Chicago. And the deadline
6
for prefiling testimony for that, again according to
7
the notice of hearing, is on Wednesday, April 23rd.
8
If anyone has questions about those procedural
9
aspects, such as prefiling, they may certainly reach
10
me through the phone number or the e-mail address that
11
I provided, and that is available on the Board's web
12
site.
13
One other issue I wish to bring up quickly, the
14
Board on the agenda of its regularly scheduled meeting
15
next Thursday, April 17th has in this docket an order
16
directing the clerk to withdraw from first notice
17
publication the original proposal that was published
18
in the Illinois Register in June of 2007. Having
19
granted the Agency's motion to proceed with the
20
amended testimony, it was the Board's conclusion that
21
that had in effect been superseded. In the interest
22
of trying to eliminate any risk of confusion or
23
misunderstanding, the Board will move forward to
24
withdraw that from first notice so that any subsequent
61
Keefe Reporting Company
1
first notice and any order it wishes to issue in this
2
proceeding will take place that much more clearly
3
hopefully.
4
Are there any other questions or any other matters
5
procedurally that need to be addressed at this time?
6
(No response.)
7
HEARING OFFICER FOX: Hearing no response, I'll
8
restate thanks on behalf of the Board and the rest of
9
its staff. We very much appreciate your time and
10
travel in being here today and, of course, for your
11
prefiled testimony and your assistance in answering
12
questions. And with that, we can adjourn for today.
13
And we will -- I suspect to see many of you in Chicago
14
on Wednesday, May 7th. Thanks once again.
15
(Hearing adjourned.)
16
17
18
19
20
21
22
23
24
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STATE OF ILLINOIS
)
)
2
COUNTY OF ST. CLAIR )
3
4
I, HOLLY A. McCULLOUGH, a Notary Public
5
within and for the County of St. Clair, State of
6
Illinois, do HEREBY CERTIFY that the foregoing record
7
was made before me on April 9, 2008, at the Madison
8
County Administration Building, Room 203, 157 North
9
Main Street, Edwardsville, Illinois.
10
IN WITNESS WHEREOF, I have hereunto set my
11
hand and affixed my Notarial Seal the 10th day of
12
April, 2008.
13
14
15
_____________________________
HOLLY A. McCULLOUGH
16
Notary Public
CSR #084-004265
17
RPR #821968
CCR #1011
18
19
20
21
22
23
24
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