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OAR Box 1778 

Prepped by Ollie Stewart 

Document Number: 

232)11-1-12 

Docket Number: 

A-90-06 

Printed 10/28/2008 9:51:02 AM Sheet 232 of 276 
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EL(2 

II-I-12 

NOTE: Parts of this item are not legible. 
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03/30^90 16:41 POLICY. PLANNING AND ANALYSIS 002 

Department of Energy 

Washington, OC 20585 

MAR 3 • 1990 

MEMORANDUM 

TO: 

FROM: 

DATE 

Dr. Roger B. Porter 

Assistant to the President 

for Economic and Domestic Policy 

Linda G. Stuntz Us 

Deputy Under Secretary 

Policy, Planning and Analysis 

March 30, 1990 

Enclosed are two alternatives for dealing with the Johnston 

Amendment as we discussed this morning. The first keeps the 

potential-to-potential test in place, as Johnston proposed. The 

second attempts to build otf the actual-to-actual test preferred 

by EPA. 

Enclosures 

cc: C. Boyden Gray 

Counsel to the President 

Teresa Gorman 

Associate Director for Environment, 

Energy and Natural Resources 

Office of Policy Development 

Howard Gruenspecht 

David Rifkin 
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_03/30/90 16:41 POLICY. PLANNING AND ANALYSIS 003 

WEPCO LANGUAGE - POTENTIAL 

Language 

Modify Johnston's amendment with provisions to ensure protection of 

environmental values: 

On page 446, beginning on line 3, strike the entirety of subsection (d) through 

line 2 on page 447. 

On page 449, following line 3, redesignate subsection (c) as new subsection (d). 

On page. 449, following line 19, insert the following new section 416: 

"APPLICABILITY OF NEW SOURCE REQUIREMENTS 

SEC. 416. No existing steam electric utility generating unit subject to 

this title shall be subject to any standard under section 111(b) or be required to 

obtain a permit under section 165 or section 173 as a result of any physical or 

operational change that occurs at such unit after the date of enactment of this 

title provided that any such change docs not: (a) increase the maximum 

potential capacity of the unit to emit criteria pollutants under its physical and 

operational design; (b) cause or exacerbate the exceedence of anv national 

ambient air quality standard promulgated pursuant to section 109; or (c) cause 

the exceedence of anv PSD increment or visibility protection limitation 

promulgated pursuant tu Part C. 

Pros 

) Use of the "potential-to-potcntial" lest is clearly understandable to all 

parties. The concept is extremely simple and would not invite litigation. 

2 Environmental objectives arc protected by explicit provisions which 

preclude application of the exemption to any facility creating an 

environmental problem. 

3 Utilities arc permitted to conduct business in any manner they wish, as 

long as environmental goals arc met. 

4 The practical effect of this provision is that it would allow, in some cases, 

small increases in emissions from plants improving operational efficiency 

through intensive maintenance and refurbishment. 
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Cons 

03/30/90 16:42 POLICY. PLANNING AND ANALYSIS 004 

Whatcvci emissions increases might result arc already permitted by 

existing rules, if achieved without a physical change at the facility, or if 

the physical change is routine. The difference is that a "non-routine" 

change would be extended the same prerogative. 

The policy will permit utilities to pursue many changes which arc 

acceptable under current policy, but which utilities arc reluctant to 

implement because of fear, uncertainty, and dread, and because of their 

perception of the aggressive manner in which EPA has interpreted the 

statute. 

Although environmental goals arc explicitly protected by the limitations 

added to Johnston's amendment, some may argue that the proposal 

would permit additional atmospheric loading and that, in itself, is 

undesirable. Setting the desirability issue aside, it is probable that 

emissions would be allowed to increase somewhat under this provision 

(but not more than they could otherwise, by alternative avenues). 

Moreover, atmospheric loading of S02 is already limited under the CAA 

by the S02 cap. Loading of NOx is diminished by the requirement for 

low NOx burners (ICF's modelling of NOx assumed that all powerplanLs 

would operate at maximum practical capacity factors). Loading of 

particulate matter is limited by current particulate matter regulations 

(SIP's), but would likely be further limited by a universal minimal 

performance requirement for ESP's, dictated by Title IH of the 

amendments (air toxics). 

The changes are surgical. The traditional PSD program for new sources 

and for all existing sources other than electric utilities is preserved intact. 

This system will not require some activities to result in application of 

'Best Available Control Technologies" (BACT), as would tbe current set 

of rules. 

The optics arc poor. Some people will perceive a major retreat in 

environmental protection policy. The change presents a convenient target 

for advocates of extremely stringent environmental policy to focus upon 

in their advocacy arguments. 

Specific anecdotal examples of major increases in emissions can be cited 

in an effort to imply that, this is bad environmental policy. 
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03/30/90 16:42 POLICY. PLANNING AND ANALYSIS 005 

ALTERNATIVE #2 

"APPLICABILITY QF NEW SOURCE REQUIREMENTS 

SEC. 416. No existing steam electric utility generating unit subject to 

this title shall be subject to any standard under section 111(b) or be required to 

obtain a permit under section 16.5 or section 173 as a result of any physical or 

operational change that occurs nt such unit after that date of enactment of this 

titlej>rovidcd that any such change docs notL (a) increase the maximum 

hourly emissions of anv criteria air pollutant, based on the 

most recent 10 years of operation; (b) cause or exacerbate the exceedence of anv 

national ambient air Quality standard promulgated pursuant to section 109; or 

(c) cause the exceedence of anv PSD increment or visibiiitv protection limitation 

promulgated pursuant to Part C. 

Pros & Cons 

Basically the same as primary alternative, except the optics are better, since the 

word "potential" is not used. PSD modifications would be treated in a manner 

very similar to the manner in which NSPS modifications are now treated 

(effectively, by emission rate, not annual tonnage).