rznirn tth e{tture STEVE PIERCE-

ANDY TOBIN er’,te Preoant

SpaW.

v.1700 et 1 tntcn 1flpenix, .rizona 85007 February

2, 2012 ‘I’he 1-lonorable Jared Blurnenfeld Region

9 Administrator U.S. Environmental Protection Agency 75 Hawthon ,ucet San Francisco, CA 941 05 Re: Pending Best Available Retrofit Technology (BART) Proposalfor Navajo Generating Station Dear Administrator Blumenfeld: We understand that the United States Environmental Protection Agency (EPA)
is no developing

a Best Available Retrofit echnology (BART) proposal for the Navajo Generating Station (\GS) designed

to reduce regional haze in certain national parks and wilderness areas. ‘[his proposal could require the installation
of emission control technology

at a cost of up to $1 .1 billion. We respectfully request that you develop

a BART proposal that makes progress towards the long-term goals of the Regional Fiaze Rule without introducing

a risk of severe economic and environmental consequences

in the state. NUS provides

a significant economic benefit
to the State of Arizona. The plant employs over 50() people, more than 80% of whom are Navajo. The Kayenta Mine, which supplies coal to NGS, has over 400 employees and approximately 80% are Native American. Ibis accounts for about 1,000 direct jobs between the two facilities. NUS also provides substantial broader economic benefits
to the state as a whole.
In a recent study, Arizona State University estimated that NGS and the Kayenla Mine will account for over $20 billion
in Gross State Product between 2011 and 2044, and contribute

to over 3,000 jobs each year. The FPA’s BAR

1’ proposal for NGS could also have

a significant impact on ater costs arni use in Arizona. NUS supplies over 90% of the power used by the Central Arizona Project (CAP,
to pump water from the Colorado River.

it provides funds for the repayment

ol the cost of constructing
the CAP, and for water rights settlements with multiple central Arizona Indian Tribes. ‘I’he cost increases associated with EPA’s BAWl proposal will be born disproportionately

by

1 ‘rihal and agricultural water users. CAP’s supply
ol renewable water
is integral
to the economy of the State ol’Arizona and supports o’.’er 80% of Arizona’s population and economic activity.

In addition, CAP has also helped the State ol Arizona meet its water management and regulatory objectives
of reducing groundwater use and ensuring availability
of groundwater

as a supplemental water supply during futureAdministrator Blumenfeld February

2, 2012 Page

2 droughts. High cost regional haze regulations will increase watercoststo manyCAP water users, making

it less affordable and potentially shifting them backto nonrenewable, finite groundwater supplies. AsEPA is well aware,the ownersof NGS recently completed the early and voluntary installation
of newemission controls—low NOx burners with separated overfire air (LNB/SOFA)—that have reduced NOx emissions by about 40%. While anEPA BART proposal requiring anyemission controls
in addition
tothose recently installed

atNGS could have high coststothe economyand be potentially devastating

tolocal communities,
the Navajo Nation and the Hopi Tribe, the benefits of such
a proposal would be highly uncertain
or negligible.
As a reportreleased bythe National Renewable Energy Lab (NREL) acknowledges: The body of research
todate ...is inconclusive

astowhether removing approximately two-thirds
of the currentNOx emissions from [NGS] would lead to any perceptible improvement

in visibility

atthe Grand Canyon and other areasof concern. Weare facing

asituation where little, if any, perceptible visibility improvements would be achieved, and yetthe costof installing such control measureswould, according

tothe NREL report,increase costof waterfor municipal users by asmuch as7 percentandfor Tribal and agricultural usersfrom anywhere between

13 and 32 percent.For agricultural users,these costs would potentially price them outof the market for the veryrenewable CAP waterresourcethat has drawn them awayfrom groundwater. The viability of NGS is contingent
onseveral key issues in addition
tothe EPA’s decision on what constitutes BART. Namely, the plant site lease and fuel supply contract expire in 2019. The extension
of these agreementswill require

a comprehensive environmental review and approval bythe United States Department
of Interior. The fuel supply contractwith Peabody Energy

is also currently being renegotiated. If EPA wereto require the six NGS owners
to install, in addition
tothe recently installed LNB/SOFA,
the most stringent, high-cost controls
asBAR’.I’, the ownerswould have to justify

a significant capital expensewithout any certainty that the plant could continue

to operate beyond 2019, and without any certainty regarding the future costof the plant site lease and fuel supply. This could putthe plant ata significant risk of closure, which could have devastating economic, waterand power supply consequences. The EPA’s Regional Haze Ruleis structured

in 10-year planning periods, with the long-term goal of reaching natural background visibility conditions

in designated national parks by 2064. Inthe first 10-year planning period, facilities that are subject
tothe Regional Flaze Rule are required
toinstall the control technology thatis determined
by EPA tobe BART. EPA will have opportunities

to require more stringent controls
in subsequent planning periods,
if necessary,

in order toachieve the long-term goals of the Regional Haze Rule. We respectfully requestthat youtake the unique circumstances affecting NUS into consideration in your pending BART proposal. Weareconfident thatif those circumstances
are properly taken into account,EPA can develop

aBART proposal that makes progresstowards the long-termAdministrator Blumenfeld February

2, 2012 Page

3 goals of the Regional Flaze Rule, without introducing the risk of severeeconomic consequences toArizona Indian Tribes and tothe stateasawhole. Sincerely, :E7ZL ANDY TOBIN

STEVE PIERCE Speaker ofthe House

Senate President / ALB1RT HALE

J CK JA KSO

7 Arizona State Representative, District

2
onaSteSen or,Dist ct