Mt. Poso Cogeneration Co. AAQIR/September 2009

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## U.S. ENVIRONMENTAL PROTECTION AGENCY REGION IX

STATEMENT OF BASIS AND AMBIENT AIR QUALITY IMPACT REPORT

For a Clean Air Act Prevention of Significant Deterioration Permit



# Mt. Poso Cogeneration Company PSD Permit Number SJ 86-09

January 2010Mt. Poso Cogeneration Co. AAQIR/September 2009

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### PROPOSED PREVENTION OF SIGNIFICAN T DETERIORATION PERMIT Mt. Poso Cogeneration Company Statement of Basis and Ambient Air Quality Impact Report PSD Permit SJ 86-09



## Table of Contents

Executive Summary ............................................................................................................. ........... 2 1. Purpose of this Document ................................................................................................... ...... 3 2. Applicant .................................................................................................................. ................. 3 3. Project Location .......................................................................................................... .............. 3 4. Project Description ....................................................................................................... ............. 3 5. Emissions from the Proposed Project ....................................................................................... 3 6. Applicability of the Prevention of Si gnificant Deterioration Regulations ................................ 5 7. Best Available C ontrol Technology .......................................................................................... 6 8. Revised Emission Limits .................................................................................................... ...... 7 9. Air Quality Impacts ........................................................................................................ ........... 7 10. Additional Impact Analysis ................................................................................................ ...... 7 11. Endangered Species Act .................................................................................................... ....... 7 12. Conclusion and Proposed Action ............................................................................................ .. 8

## Proposed Prevention of Signific ant Deterioration (PSD) Permit Statement of Basis and Ambient Air Quality Impact Report

Mt. Poso Cogeneration Company

Executive Summary

The Mt. Poso Cogeneration Company (MPCC) has applied for a modified Prevention of Significant Deterioration (PSD) permit under th e federal Clean Air Act (CAA), 42 U.S.C. Section 7401 et seq. MPCC operates an existing 49.9 MW Atmospheric Circulating Fluidized Bed Combustor (boiler) Cogeneration Power Plant, located near Bakersfield, in Kern County California, which has been in operation since 1989. Th e initial PSD permit was issued for this facility by EPA Regi on 9 on January 8, 1987, and was previously modified on May 10, 1990, June 22, 1995, November 30, 1995, June 27, 1996 and July 8, 1999. The facility currently util izes a blend of coal, petroleu m coke and tire derived fuel (TDF). The proposed modification is to allow MPCC to utilize a renewable fuel – woody biomass in addition to the existing fuels. Primary biomass fuel sources will include: agricultural waste in the form of orchard re movals, orchard prunings, shells, and pits; and urban wood waste including tree trimmings, wo ody construction waste, pallets, and clean demolition wood from county and municipalities’ recycling programs.

The proposed PSD permit is consistent with th e requirements of the PSD program because the project will not result in a signi ficant emissions increase of any attainment pollutant. Changes are being proposed to the existing PSD permit to a llow the use of biomass as a new fuel and the construction of a new fu el handling system.

## 1. Purpose of this Document

This document serves as the Statement of Basis and Ambient Air Quality Impact Report for the proposed modified PSD permit for the Mt. Poso Cogeneration Company (Mt. Poso). This document describes the le gal and factual basis for the proposed permit per 40 CFR 124.7, including requirements under the PSD regulations at 40 CFR 52.21. 

## 2. Applicant

Mt. Poso Cogeneration Company (Mt. Poso) 8302 Espresso Drive Suite 130 Bakersfield, CA 93312 

## 3. Project Location

The Mt. Poso power plant is located at 36157 Famoso Hwy, Bakersfiel d, California. The project is within the San Joaquin Valley Ai r Pollution Control Dist rict (SJVAPCD or District). 

## 4. Project Description

Mt. Poso operates an existing 49.9 MW Atmospheric Circulating Fluidized Bed Combustor Cogeneration Power Plant. Mt. Po so facility has been in operation since 1989. The facility currently util izes a blend of coal, petroleu m coke and tire derived fuel (TDF). The proposed modification is to allo w Mt. Poso to utilize a renewable fuel – woody biomass in addition to the existing fuel s. Primary biomass fuel sources will include: agricultural waste in the form of or chard removals, orchard prunings, shells, and pits; and urban wood waste including tree tr immings, woody construction waste, pallets, and clean demolition wood from county and municipality recycling programs.

In order to accommodate the new biomass fuel, Mt. Poso is proposing to add a new material handling and loading system and make minor physical modifications to the existing boiler unit. The new system consis ts of a receiving, c onveying, screening, and stacking operation (SJV unit S-91-10) and a reclaiming operation (SJV unit S-91-11) to store the additional volume of fuel require d. In addition to EPA’s PSD construction permit, SJVAPCD will issue an NSR construc tion permit for the following equipment:

SJV Unit S-91-10: The proposed system will consist of four truck receiving areas equipped with enclosed hoppers and truck tippers and one walking floor capable of receiving 250 tons/hr of material ( 12 hours/day, 6 days/week). The biomass will be sent through a magnetic separator a nd will then be sorted through a disc screen and a hammer mill (hog). Fully encl osed Tubulators that float a rubber conveyor belt over a thin sheet of air will carry the material through fully enclosed transfer towers and stack th e material in two piles (4 million ft 3 capacity per pile).

SJV Unit S-91-11: The reclaiming porti on of this operation consists of a reclaiming chain (both towers capable of pulling 60 tons/hr of material 24hours/day and 7 days/week) that will rake the material off the pile onto a conventional conveyor belt, through anothe r magnetic pickup point, and into a gyrating screen to remove fines. From he re the fines will be exported to a fully enclosed truck loadout using a screw-type conveyor. The biomass that passes the screen will then be transported to the fu el bin for combustion. The existing fuel receiving and transferring operation, permit S-91-1-9, will be cancelled upon implementation of these new ATCs.



## 5. Emissions from the Proposed Project

Evaluation of Trial Burn Emission Data On January 9, 2009, EPA issued an Administrative Amendmen t (AA) to the PSD permit for this facility to allow a 6-month trial burn using biomass as an alternative fuel in order to collect relevant emissions data for the modified operation. On July 22, 2009, EPA extended the AA to allow continuation of the trial burn for an additional 6 month period. As required by the AA, Mt. Poso has submitted monthly reports containing data related to the trial burn. EPA has reviewed this data for the periods of Febr uary through June 2009. The data shows that while burning up to 32% biomass, the boiler was able to comply with the applicable emission limits though the use of existing control devices. These control devices include ammonia injection to control thermal NO x , limestone injection to control SO 2 , and cyclones and baghouses to control PM and PM 10 . Both the NO x and SO x control devices work on a feed back system, which increases the injection of ammonia or limestone as NO x or SO x emission levels rise and maintain NO x and SO x emissions at specified emission rates. The c ontrol efficiency of the existing baghouses is not expected to change. In addition, the extended combustion zone residence time in a circulating fluidized bed combustor results in minimization of CO and hydrocarbons, independent of the fuel blend.

Based on the emissions data and material prof iles contained in the monthly reports, the source has requested to be a llowed to burn up to 100% biom ass by weight. EPA believes that with the continued use of the existing control equipment, the source will be able to continue to comply with their permitted emissi on limits at the proposed solid fuel loading rate of 58,333 lbs/hr and is therefore granting the request to modify the existing permit and allow a new fuel rate limit for biomass. EPA also notes that the boiler is equipped with a Continuous Emission Monitoring System (CEMS) unit to measure NO x , SO x, O 2 and CO emissions and verify compliance. R ecords of fuel processed, source test results and emission factors will be used to determine compliance with PM and PM 10 emission limits. The number of trucks delivering fuel to the facility will be limited to 120 per day to limit fugitive PM10 emissions from these trucks.

The project proposes the use of urban wood waste which is generally defined as tree trimmings, woody construction waste, pallet s, and clean demolition wood from county and municipality recycling programs. In orde r to ensure this wast e does not contain other contaminants not evaluated under this act ion, the revised PSD permit will include a condition restricting the conten t of non-biomass materials (such as plastics, metal, painted and preservative-treated wood, roofing material, fiberg lass, etc.) to no more than1% by weight of all biomass combusted. Delivery of each bio-mass load will be inspected for such materials, and the source will be required to sample a random biomass load upon EPA request to ensure compliance with this provision.

Evaluation of Projected Emission Increases The San Joaquin Valley Unified Air Pollution C ontrol District (District) is currently classified attainment for NO 2 , PM 10 , SO 2 and CO. The Mt. Poso facility is currently a PSD major source for NO x , SO 2 and CO. Mt. Poso has recently revised its local NSR permit issued by the District to take federally enforceable limits for NO x , SO x and CO emissions and is proposing to take a federally enforceable PM 10 emission limit in the PSD permit, as indicated in Table 5-B. Ta bles 5-A, 5-B and 5-C below summarize the pre-project baseline actual emissions, the post-project emissions ba sed on potential to emit (PTE), and the emission increase/decreas e for each pollutant, respectively.

Table 5-A Pre-project Baseline Actual Emission Rates* Pollutant Tons/year Nitrogen Oxides (NO x ) 192.0 Particulate Matter – 10 microns (PM 10 ) 11.9 Sulfur Oxides (SO 2 ) 65.0 Carbon Monoxide (CO) 86.1

*Baseline years are 2004 and 2005 for NOx, SO 2 and CO Baseline years for PM10 are 7/1/07 through 6/31/09

Table 5-B Maximum (PTE based) Post-project Emission Rates* Pollutant Tons/year Nitrogen Oxides (NO x ) 231.5 Particulate Matter – 10 microns (PM 10 ) 26.7 Sulfur Oxides (SO 2 ) 104.5 Carbon Monoxide (CO) 185.7

*PTE based on enforceable emission limits in District or PSD permit

Table 5-C Emission Increases from Project Pollutant Tons/year Nitrogen Oxides (NO x ) 39.5 Particulate Matter – 10 microns (PM 10 ) 14.9 Sulfur Oxides (SO 2 ) 39.5 Carbon Monoxide (CO) 99.6



## 6. Applicability of the Prevention of Significant

## Deterioration Regulations

The PSD regulations (40 CFR 52.21) define a “major source” as any source type belonging to a list of 28 source categories which emits or has the potential to emit 100 tons per year (tpy) or more of any attainme nt pollutant regulated under the Clean Air Act, or any other source type which emits or ha s the potential to emit such pollutants in amounts equal to or greater than 250 tpy. Since the combustion boiler is rated at 620 MMbtu/hr, it is one of the listed 28 source catego ries specified in the PSD regulations, therefore the 100 tpy major source thres hold applies to this facility.

The District where this project is located, is classified as a federal non-attainment area for 

### PM 2.5 and ozone, therefore 

### PM 2.5 and VOC (an ozone precursor) emissions will be regulated by the New Source Review (NSR) permit issued by the District and are not addressed by this PSD evaluation.

Mt. Poso is currently a PSD major source, th erefore the change in emissions from the proposed project must be evaluated to determin e if the project will result in a significant or significant net emissions increase of any a ttainment pollutant. Using the data provided in Tables 5-A through 5-C above, Table 6-A below summarizes the projected emission increases and significant thresholds for each attainment pollutant. The project will not result in a significant increase of any attainment pollutant su bject to the PSD regulations. Accordingly, the proposed project does not tr igger any major source PSD requirements.

Table 6-A Significant Emission Threshold Evaluation (tons per year)

Pollutant Projected Increase Significant Threshold

s Significant Increase?

Nitrogen Oxides (NO x ) 39.5 40 No Particulate Matter – 10 microns (PM 10 ) 14.9 15 No Sulfur Oxides (SO 2 ) 39.5 40 No Carbon Monoxide (CO) 99.6 100 No

EPA notes that all of the emission increas es are close to the significant emission thresholds because Mt. Poso chose to lim it their post-project PTE to avoid these thresholds through the use of federally enforceable permit conditions in either their District issued NSR permit or EPA issued PSD permit. 

## 7. Best Available Control Technology

PSD regulations require that a Best Availa ble Control Technology (BACT) determination be made for each pollutant subject to major PSD review. As noted in Section 6 above, this project does not trigger a major PSD review therefore the application of BACT is not required for this project.

## 8. Revised Emission Limits

The mass and concentration emission limits in the current PSD permit will remain in effect. A new annual emission limit has been added as Section IX.G. to ensure this project will not result in a significant increase in PM 10 emissions. 

## 9. Air Quality Impacts

As noted in Section 6 of this review, th is project will not result in a major PSD modification; therefore an Air Quality Impact Analysis is not required. 

## 10. Additional Impact Analysis

As noted in Section 6 of this review, th is project will not result in a major PSD modification; therefore no additiona l Impact Analysis is required. 

## 11. Endangered Species Act

Pursuant to Section 7 of the Endangered Species Act (ESA), 16 U.S.C. §1536, and its implementing regulations at 50 C.F.R. Part 402, EPA is required to ensure that any action authorized, funded, or carried out by EPA is not likely to jeopardize the continued existence of any endangered spec ies or threatened species or result in the destruction or adverse modification of such species’ designate d critical habitat. EPA determined that this PSD permitting action is subject to ESA Section 7 requirements.

On August 31, 2009, EPA received a document titled “Biological Pre-Construction Survey for the Mount Poso Cogeneration Plan t Expansion, Kern County, California” that served as the Biological Assessment (BA) pr epared by the applicant’s consultant, Quad Knopf.

On September 16, 2009, EPA provided the BA to FWS and requested concurrence that the project is not likely to a dversely affect any endangered sp ecies know to be in the area, such as the San Joaquin kit f ox, blunt-nosed leopard lizard ( Gambelia sila ), California jewelflower ( Calanthus californicus ), and San Joaquin wooly-threads ( Lambertia congdonii ).

On December 21, 2009, FWS informed EPA that the projects fencing in of 20 acres would have a permanent impact upon potential San Joaquin kit fox foraging habitat. At this time FWS is working with Mt. Poso to ensure compliance with all ESA requirements prior to issuance of a PSD by EPA. EPA w ill proceed with issuan ce of its final PSD permit decision after making a determination that issuance of the permit will be consistent with ESA requirements. In making this determination, EPA will consider actions taken, or to be taken, by the applicant to ensure ESA compliance.

## 12. Conclusion and Proposed Action

Based on the information supplied by the a pplicant, and the evaluation provided above which determined this project will not result in a major PSD modification, EPA is proposing issuance of a modified PSD permit.