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February 25, 2011

Via Email

Gina A. McCarthy

Assistant Administrator for the Office of Air and Radiation

USEPA Headquarters 

Ariel Rios Building 

1200 Pennsylvania Avenue, N. W. 

Mail Code: 6101A 

Washington, DC 20460

E-mail: mccarthy.gina@epa.gov

RE: Avenal Power Plant

Dear Ms. McCarthy:

Sierra Club writes to express strong concerns about EPA’s recent proposal to 

exempt the Avenal Natural Gas Power Plant (the “Project”) from applicable air quality 

standards. Such an action would have significant and detrimental impacts on air quality 

in the San Joaquin Valley and set dangerous precedent nationwide. Allowing the Project 

to operate as currently proposed would violate the federal hourly NO2 standard, and 

expose local residents to ambient air quality levels that EPA has determined are unsafe. 

Sierra Club strongly recommends that EPA abandon its proposal to initiate 

rulemaking to exempt the Avenal Project from applicable air standards. EPA should 

instead deny the PSD permit because the permit is not necessary: Avenal has already 

submitted a revised proposal and received a local air district determination of compliance 

to operate as a minor source. Avenal need only obtain an amendment to its existing 

California Energy Commission license that incorporates the revised minor source permit 

in order to proceed with construction. Requiring the Project to move forward as a minor 

source with reduced emissions of NOx and CO is a far superior option compared to 
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setting the disturbing precedent of exempting facilities from applicable ambient air 

quality standards, which would increase health risks and cause litigation against this 

project and others for violations of federal and state air quality laws. 

I. BACKGROUND

Avenal Power Center, LLC (“Avenal”) proposed to build a 600 megawatt

combined cycle natural gas-fired power plant within the City of Avenal in Kings County. 

Avenal filed an Application for Certification on February 21, 2008 with the California 

Energy Commission (“Energy Commission”). The Energy Commission approved the 

Project on December 16, 2009 (the “Final Decision”). To ensure compliance with federal 

and state air quality laws, the Final Decision relied on a Final Determination of 

Compliance (“2008 FDOC”) issued by the San Joaquin Valley Air Pollution Control 

District (“SJVAPCD”) on November 4, 2008. In the 2008 FDOC, the SJVAPCD 

evaluated the project as a major source for both NO2 and CO. The Avenal Project 

therefore triggered prevention of significant deterioration (“PSD”) requirements of the 

Clean Air Act and the need for a PSD permit. 42 U.S.C. § 7476. Avenal has not 

commenced construction of the Project because it has not received a PSD permit from 

EPA. 

A PSD permit must ensure that the Project does not contribute to the deterioration 

of ambient air quality in the San Joaquin Air District. On February 9, 2010, EPA issued a 

National Ambient Air Quality Standard (“NAAQS”) for hourly concentrations of NO2

that is more stringent than the previously applicable California standard, and any PSD 

permit must meet this standard. The Energy Commission did not consider Avenal’s 

emissions of NO2 with respect to the new NAAQS because it relied on EPA to assume 

this burden through the issuance of a PSD permit. (Final Decision at p. 129.) However, 

EPA recently indicated that it would not enforce the legally applicable NO2 standard for 

this Project by adopting a type of “grandfathering” policy. We urge EPA to abandon this 

course of action. As discussed below, Avenal has applied for and received a permit to 

operate as a minor source with lower NO2 emissions. EPA can simply deny Avenal’s 

permit if it does not meet the requirements for NO2, and the Project can proceed as a 

minor source.

Avenal has used litigation to force EPA to ignore the currently applicable hourly 

NAAQS for NO2 and exempt the Project from the mandatory PSD requirement to 

demonstrate that the proposed facility will not cause or contribute to a violation of the 

hourly NO2 standard. Were EPA to abdicate its regulatory authority for the facility, the 

Project will likely violate both federal and California laws and regulations. Avenal’s 

violation of the NO2 standard would present a significant health risk to the residents of 

the City of Avenal and other California residents in the San Joaquin Air District because 

the Project would result in concentrations of NO2 that the federal government has deemed 

unsafe. 

Simultaneous with its pending application for a PSD permit from EPA, Avenal 

submitted a revised request for a minor source permit from the SJVAPCD. This revised 
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permit request was identical to the previous request, except that Avenal proposed to 

reduce NOx emissions from 288,618 lb/yr to 198,840 lb/yr and to reduce CO emissions 

from 1,205,418 lb/yr to 197,928 lb/yr, which would bring the Avenal Plant under the 100 

tons/year trigger for PSD permitting. 42 U.S.C. § 7479. The only apparent reason for 

this revised permit request was to avoid PSD permitting requirements. The SJVAPCD 

issued a revised FDOC on December 17, 2010 (the “2010 FDOC”). 

Avenal appears to be hedging its bets by pursuing two strategies: (1) proceeding 

with the Avenal Project as a major source if EPA exempts the facility from the legally 

applicable NAAQS; or (2) limiting emissions of NOx and CO to less than 100 tons per 

year to avoid a PSD permit. This latter option would require Avenal to request an 

amendment to its license from the Energy Commission, replacing the 2008 FDOC 

requirements with the 2010 FDOC requirements. 

Option 1 above violates federal and state law. The Final Decision issued by the 

Energy Commission reasonably presumed that EPA would fulfill its statutory mandate to 

ensure that the Project would not cause or contribute to a violation of applicable ambient 

air quality standards. (Final Decision, p. 129.) EPA’s proposal to exempt the Project 

from the applicable NAAQS would undermine the basis on which the Energy

Commission made its decision approving the Project. EPA’s action would also have 

significant health impacts for the residents in the San Joaquin Air District. Accordingly, 

the Project and the Energy Commission would face litigation risks for violating air 

quality laws. 

As stated in the Final Decision, the Project is a stationary source that is subject to 

all SJVAPCD rules and regulations. (Final Decision, pp. 118, 127.) The Project is a new 

stationary source that, according to analyses in the Final Decision and the 2010 FDOC

will likely result in total emissions of NO2 that violate the federal NAAQS. (Final 

Decision, Air Quality Table 5, p. 123; 2010 FDOC, Attachment G.) The Project will 

therefore violate SJVAPCD Rule 2201-4.14.1 because it is a stationary source that will 

likely cause a violation of ambient air quality standards. Typically, compliance regarding 

a criteria pollutant for which the air district is in attainment would be met by relying on 

EPA to issue a PSD permit. However, in this case, EPA’s decision to abdicate its 

authority on this issue leaves a regulatory void that will cause a violation of SJVAPCD 

Rule 2201 and, by extension, will violate both federal and state law. 

II. PROJECT IMPACTS

In undertaking its analysis of the Project’s impacts on air quality, the Energy

Commission staff worked with SJVAPCD and relied on the 2008 FDOC to conclude that 

the Avenal Plant would not violate the then-applicable California Ambient Air Quality 

Standards (“CAAQS”) for 1-hour NO2. The hourly NO2 limit under the then-applicable 

CAAQS was 0.18 ppm, or 339 μg/m3. There was no federal hourly NO2 standard when 

the Energy Commission’s Final Staff Assessment was prepared and released. (Final Staff 

Assessment, Air Quality Table 2, p. 4.1-7.) The Final Decision concluded that the 

Avenal Project would just barely avoid a violation of the NO2 hourly emission standards

because the modeled Project impact and the background emissions combined for a total 
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impact of 327.2 μg/m3, which was 97 percent of the 339 μg/m3 threshold CAAQS. (Final 

Decision, Air Quality Table 5, p. 123.) The modeled impact of the Project therefore did 

not appear to violate ambient air quality standards for NO2 in the San Joaquin Air 

District. The Energy Commission did not include specific conditions of certification for 

the Project to reduce or offset its NO2 emissions with respect to ambient air quality 

standards because an EPA issued PSD permit would ensure that the Project would not 

cause or contribute to a violation of the hourly NO2 standard in the San Joaquin Valley 

Air District. (Final Decision, p. 129.) 

Two months after the Energy Commission issued the Final Decision approving 

the Project, EPA issued a NAAQS for hourly NO2 that was more stringent than the 

California standard. 75 Fed. Reg. 6474. The new NAAQS set a limit of 100 ppb (.10 

ppm), or 188 μg/m3 for hourly NO2. Under this new standard, it is likely that the total 

impact of the Project would greatly exceed air quality standards. (Final Decision, Air 

Quality Table 5, p. 123.) The SJVAPCD analysis conducted with respect to the revised 

2010 minor source permit confirmed the likelihood of a violation because the Project, 

operating as a minor source with significantly reduced NOx emissions, would barely meet 

the hourly NO2 NAAQS standard. (2010 FDOC, Attachment G.) 

III. A SOLUTION THAT PROTECTS AIR QUALITY AND COMPLIES WITH THE LAW

Avenal has filed litigation against EPA seeking to force EPA to make a final 

decision on its PSD permit. In its motion for summary judgment in that litigation, 

Avenal asserted that it should not be subject to the federal NAAQS for hourly NO2 and 

that EPA should grant the PSD permit without requiring the Project to demonstrate that it 

meets the standard. EPA should have simply denied that request and issued a PSD permit 

that required Avenal to show that it would meet the applicable NO2 standard through 

operational changes or control technologies. However, in its response to Avenal’s 

motion for summary judgment, EPA inexplicably indicated its intention to exempt the 

Avenal Project from PSD requirements related to NO2. 

The Project’s free pass does not, however, extend to the San Joaquin Valley or its 

residents. The Avenal Project will cause violations of NAAQS that California and the 

San Joaquin Air District must address, and “exempting” a violation of NAAQS will result 

in substantial health costs to the local population.

Fortunately, Avenal has already provided a ready-made path allowing the Project 

to move forward without violating the NAAQS. The Project can proceed as a minor 

source for NO2 that would not require a PSD permit and would not violate NAAQS 

because of its limited NOx emissions. (See FDOC Attachment G.) In order to finalize its 

permits and begin construction, Avenal need only petition the Energy Commission to 

amend its Final Decision to incorporate the 2010 FDOC in place of the 2008 FDOC. 

IV. CONCLUSION

Rather than forcing itself, the Energy Commission, and the San Joaquin Air 

District to violate federal and state air quality laws and expose residents to harmful 
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pollutants, EPA should deny the PSD permit for the Project. Avenal then has the simple 

task of requesting an amendment to the Energy Commission’s Final Decision that 

incorporates the provisions of the 2010 FDOC. This solution would allow Avenal to 

proceed with construction and avoid a host of serious problems. 

Sincerely,

/s/ Travis Ritchie______

Travis Ritchie

Associate Attorney

Environmental Law Program

85 Second Street, Second Floor

San Francisco, CA 94105

travis.ritchie@sierraclub.org

cc:

Stephanie J. Talbert

Trial Attorney 

United States Department of Justice 

Environment and Natural Resources Division 

Environmental Defense Section 

P.O. Box 23986 

Washington, D.C. 20026-3986 

E-mail: stephanie.talbert@usdoj.gov 

Brian Doster

United States Environmental Protection Agency 

Office of General Counsel 

Ariel Rios Building 

1200 Pennsylvania Ave. NW 

Washington. D.C. 20460 

E-mail: doster.brian@epa.gov 

Julie Walters

United States Environmental Protection Agency, 

Region 9 

75 Hawthorne St., Mail Code ORC-2 

San Francisco, CA 94105 

E-mail: walters.julie@epa.gov