.nsr. UNITED STATES ENVIRONMENTAL PROTECTION AGENCY REGION 10 1200 Sixth Avenue Seattle, WA 98101
^'RL PiiQ c' December 8, 2011 Reply to Attn Of: 0EA-095 MEMORANDUM
SUBJECT: Review of the ADEC BART Determination Support Document for Golden

Valley Electric Association (GVEA) -- Healy Unit 1 Power Plant FROM:

TO: Keith Rose, Environmental Scientist

State and Tribal Air Programs Unit, OAWT
As you requested, I have reviewed the Final BART Determination Report prepared by Enviroplan Consulting that Alaska Department of Environmental Conservation (ADEC) submitted for the Healy power plant owned by GVEA, dated January 19, 2010, revised June 1, 2010. The Enviroplan document is part of Appendix III.K.6 of section III.K of the State Air Quality Control Plan addressing regional haze, which was adopted by the State of Alaska on February 11, 2011. This report is a revised version of my report regarding BART at the Healy power plant. My original report was finalized September 29, 2011, and did not include analysis of a twenty year facility remaining useful life. This revised report includes these analyses, and supersedes and replaces the original report. The Healy Unit 1 boiler is a wall-fired, wet bottom coal-fired boiler nominally rated at 25 MW. The boiler is equipped with the following air pollution controls:

* PM - reverse-air baghouse installed in the 1970s, NOx - low- NOx burners (LNB) and over fire air (OFA) installed in 1996, and

a S02 - dry sorbent injection (DSI) with sodium bicarbonate installed in 1999. Summary The Enviroplan document, as adopted by ADEC, establishes the following as BART based on an 8 year remaining useful life for Healy Unit 1:
® PM - Existing baghouse, with an emission limit of 0.015 Ib/MMBTU, with compliance determined by source testing, Zach Fled; ^•th, P Environmental Engineer, ESU, OEA• NOx - An emission limit of 0.2D lb/MMBTU, 30-day rolling average, as attainable

by the addition of selective, non-catalytic reduction (SNCR) to the existing lowNOx burner (LNB) and over fire air (NA), and
s S02 - Existing dry sorbent injection (DSI), with an emission limit of 0.30 lb/MMBTU, 30-day rolling average, For PM, the existing baghouse represents a level of control consistent with BART, and the proposed emission limit is not unreasonable based on an informal survey of limits applicable to similar emission units. I agree with the ADEC BART determination for PM. The BART emission limits for NOx and 502 established by ADEC are conservative and reflect emission rates that are easily achievable with the associated control technology. For both pollutants, technically feasible and cost effective options exist to further reduce emissions and improve visibility. However, in each case, the more efficient technology includes some risk of secondary environmental impacts, as detailed below. Facility Remaining Useful Life All BART determinations and analyses in the Enviroplan report are based on a remaining useful life for the Healy Unit 1 boiler of 8 years, The justification offered by GVEA for using 8 years as the remaining useful life of Healy 1 is described in detail below, The 8 year remaining useful life is significantly shorter than customary useful life values used in the EPA Air Pollution Control Cost Manual (EPA, 2002). With regard to NOx controls, the EPA Cost Manual uses 20 years as the useful life for both SCR and SNCR. In an earlier document 1 , Enviroplan includes justification for using 15 years as the maximum useful lifetime for SCR rather than 20 years due to the harsh climate in Alaska. In my opinion, 15 years is a reasonable estimated remaining useful life for equipment used to control NOx on the Healy 1 boiler. However, this report does include certain cost effectiveness values based on a 20 year remaining useful life for illustrative purposes. The EPA Cost Manual does not contain a final section addressing S02 control technologies, so a direct "default" useful life period is not available. The EPA Cost Manual does cite a useful life of 15 years for wet scrubbers controlling acid gases, which is similar to wet scrubbing for S0 2. In my opinion, 15 years is a reasonable estimated remaining useful life for equipment used to control S02 on the Healy 1 boiler. When compared with 15 years, the shorter useful life of 8 years significantly reduces the cost-effectiveness of the various control options because it reduces the amortization period over which the cost of the controls is spread, In the case of NOx, the shorter useful life contributes to a less stringent BART determination, as discussed below. However, SCR is not cost effective for this facility regardless of whether a remaining useful life of 8, 15, or 20 years is used in the calculations.

' Final Findings Report. Golden Valley Electric Association, Best Available Retrofit Technology Evaluation. Enviroplan Consulting, April 27, 2009. See page 17.3

Enviroplan explains the basis for the 8 year remaining useful life on pages 6-83 and 6- , 84. The 8 year value is derived based on the following assumptions:

• Final approval of the Alaska SIP occurs in 2011, 3 Installation of the control equipment occurs in 2016, and d Closure of Unit 1 occurs in 2024. The 8 year remaining useful life assumption is problematic for two reasons. First, it appears that the projected 2024 closure is not federally or state-enforceable, and therefore should not form the basis for remaining useful life under BART, according to 40 CFR 51, Appendix Y, Section IV.D.4.k.2. If a remaining useful life of less than 15 years for Healy Unit 1 is to be the basis for the BART determination, the closure date should be made enforceable. If not, a remaining useful life of 15-years should form the basis for the analysis. The second issue relates to the timeframe necessary for installation of the controls selected as BART. As noted, the Enviroplan analysis allocates the maximum time allowed under BART (5 years) for GVEA to come into compliance with the BART emission limits. However, the control options forming the basis for the BART emission limits that are technically achievable and cost-effective 2 with respect to NOx and SO2 would not normally require the full 5 years for implementation. For example, SNCR installations typically require between 8 months and one year between bid evaluation and equipment startup ((CAC, 2006). Installation of rotating opposed fire air (ROFA®) and/or Rotamix®, which are variations on OFA and SNCR should not require a significantly longer time period. Control of SO2 via optimization of the existing dry sorbent injection system (additional sorbent injection equipment) should require less time than the NOx retrofit work. BART implementation timeframe is addressed within 40 CFR 51.302(c)(4)(iv), which states that " (t)he plan must require that each existing stationary facility required to install and operate BART do so as expeditiously as practicable but in no case later than five years after plan approval". It seems reasonable that the actual time necessary for implementation determine the applicability date of the BART emission limits rather than the maximum time allowed under the rule. I estimate the time necessary not to exceed 2 years following final SIP approval, allowing for reasonable contingencies. Cost Analyses Enviroplan conducted analyses to determine cost-effectiveness for several control technologies for both NOx and SO2. The results of the analyses are given in two tables at the end of the Enviroplan document, and page 6-83 describes the cost analyses and the supporting sources of information. The Enviroplan document does not contain the detailed cost calculations on which the BART determinations were based. The
Necessary tin€et-'ra€ne for selective catalytic reduction (SCR) installation was not researched because SCR is not cost-effective under any of the facility remaining useful life scenarios evaluated4

Enviroplan cost analyses for all control options except selective catalytic reduction (SCR) for NOx control were conducted using EPA's CUECost, which was developed to estimate control costs for energy generating units, including coal-fired boilers. The cost estimate for installation of SCR for control of NOx was taken directly from a site-specific quote prepared by a vendor (Fuel Tech, 2009). Efforts to obtain the detailed cost calculations performed using CUECost from the State of Alaska and Enviroplan were not successful due to a combination of staff turnover, destruction of hard copies (by a fire at Enviroplan's offices), and concerns regarding confidential business information. The vendor quote for SCR prepared by Fuel Tech was obtained from the ADEC website. It may be possible to obtain more detailed information regarding the cost analyses from Enviroplan, but I do not expect this would change my conclusions regarding cost effectiveness of the control technologies to a significant degree for the following reasons:

• The vendor quote for SCR takes precedence over any estimate performed using CUECost or methods according the EPA Control Cost Manual, and establishes that SCR is cost-prohibitive at this facility,

• All remaining control technologies for NOx may be cost-effective based on the Enviroplan analysis, depending on the remaining useful life of the facility, and

• Al] control technologies considered by Enviroplan for S02 are either costeffective, or are eliminated from consideration as BART for other reasons.
BART for NOx The Enviroplan BART analysis identified the following options as technically feasible
for control of NOx from Healy Unit 1, with the associated emission rates (30-day rolling average), emissions reductions, and visibility improvements. The maximum visibility impact from Healy Unit 1 is given as 3.359 deciview (dv), while the visibility impact is modeled to exceed the threshold value of 0.5 dv for 136 days. Control Technology NOx Emission Rate (Ib/MMBTU) 3 Tons

NOx Reduced Visibility

Improvement (dv, days) Incremental

Visibility Improvement (dv, days) Baseline (LNB/OFA) 0.28 0 0 0 Optimize LNB/OFA 0.23 74 0.560 dv, 43 days 0.560 dv, 43 days SNCR 0.20 1194 riot evaluated not evaluated SNCR 0,19 134 0.620 dv, 51 days 0.060 dv, 8 days

- ROF'AQ 0.15 194 0.671 dv, 56 days 0.051 dv, 5 clays ROTA/Rotamixe 0.11 253 0.736 dv, 67 days 0.065 dv, 11 days SCR 0.07 313 ^ 0.786 dv, 71 days 0.050 dv, 4 days

' The following limits were provided by the control equipment vendor: 0.19 lh/MMBTU for SNCR, 0.15 lh/MMBTU for ROFA®, 0.11 lb/MMI3TU for ROFA/Rotamix®, and 0.07 ]b./MMBTU for SCR. Calculations by Zach Hedgpeth. PE - This emission rate was not evaluated in the Enviroplan report.5

The following table summarizes the cost-effectiveness of the NOx control technologies. Values are taken from the Enviroplan document unless otherwise noted. Incremental cost-effectiveness values are shown in italics. Cost-effectiveness for visibility improvement is shown in millions of dollars per deciview.

Control Limit 20-year 15-year 10-year6 8-year Technology Ib/MMBTU Costss Costs Costs Costs Optimize 0.23 $28/ton $32/ton $40/ton $47/ton LNB/0FA $28/ton $32/ton $40/ton $47/ton $0.004M/dv $0.004M/dv $0.005M/dv $0.006M/dv .$0.004M/dv $0.004M/dv $0.005M/dv $0.006M/dv SNCR 0.20 7 $3,206/ton $3,526/ton $4,213/ton $4,745/ton $8,433/ton $9,2 71/ton $11,074/ton $12,472/ton Visibility improvement from SNCR at 0.20 lb/MMBTU was

not evaluated by Enviroplan.
SNCR 0.19 $2,847/ton $3,125/ton $3,741/ton $4,208/ton $6,324/toil $6,992/ton $8,305/ton $9,409/ton $0.6M/dv $10.2114/dv $0.7M/clv

$11,2M/dv $0.8M/dv

$13.4M/dv $0.9M/dv

$15.IM/clv ROFA@ 0.15 $3,116/ton $3,476/ton $4,228/ton $4,827/ton $3,717/ton $4,267/ton $5,315/ton $6,219/ton $0.9M/dv $5.6M/dv $1.OM/dv

$6.4M/dv 

### $1.2M/dv

$8.1M/dv $1.4M/dv

$9.4M/dv ROFA/ 0.11 $3,918/ton $4,325/ton $5,207/ton $5,886/ton Rotamix® $6,556/ton $7,082/ton $8,427/ton $9,328/ton 

### $1.3M/dv $6.9M/dv $1.5M/dv

$7.5M/dv $1.8M/clv

$8. 7M/dv $2.0M/clv

$9.7M/dv SCR 0.07 $10,708/ton $11,765/ton $14,004/ton $15,762/ton $39,340/ton $43,385/ton $51,095/ton $57,734/ton $4.3M/dv $58.3M/dv $4.7M/dv

$63.9M/dv $5.6M/dv

$75.7M/clv $6.3M/dv

$84.9M/dv

' Calculations by Zach Hedgpeth, PE - Twenty year facility remaining useful life was not evaluated in the Enviroplan report. Calculations by Zach Hedgpeth, PE - Ten year facility remaining useful life was not evaluated in the Enviroplan report.

' Calculations by Zach Hedgpeth, PE. - This emission rate was not evaluated in the Enviroplan report.6

Cost-effectiveness data for NOx under the 10-year facility remaining useful life scenario is depicted in the following chart.



### NOx Cost-Effectiveness: 10-year Facility Lifetime

o'q

BART for NOx as determined by Enviroplan and adopted by ADEC is an emission limit of 0.20 lb/MMBTU, 30-day average, as attainable by the addition of a new SNCR system and the existing LNB and OFA.
SCR As described in the Enviroplan document, GVEA commissioned a site-specific cost analysis for the installation of SCR from Fuel Tech. The Fuel Tech report was obtained from the ADEC website and found to be generally in accord with the EPA Control Cost Manual. Site specific vendor quotes take precedence over cost estimates prepared using general cost estimation tools such as the EPA Control Cost Manual or CUECost because they are considered to more accurately represent actual site conditions. The Fuel Tech cost analysis resulted in cost-effectiveness values for control of NOx via SCR of $10,708/ton (20-year life), $11,765/ton (15-year life), and $15,762/ton (8-year life). Based on the Fuel Tech analysis, I agree that SCR is not cost-effective as BART for NOx at this facility. $60,000
$50,000
$40,000



# 1-

i X J

-,- -/J

......................................... --------- --------- - - ------------ $80 $70 $60

$/ton

- - Incr. $/ton $20 -$M/dv

yr'
--- Incr. $M/dv $10 $30 $50 $40

$0ROFA with Rotamix®

Rotating opposed fire air (ROFA®) and Rotamix® are proprietary technologies available from Nalco Mototec. ROFA® relies on combustion staging and mixing to create conditions within the combustion chamber which reduce formation of NOx. Rotamix® consists of an enhancement to ROFA® which, includes injection of urea for removal of NOx, similar to SNCR. ROFA® and Rotamix® are established technologies which have been installed on coal-fired boilers of various sizes across the country, including:

• Minnesota Power's Taconite Harbor Generating Station in Schroeder, Minnesota - Three 75-MW boilers,

• Richmond Power & Light's Whitewater Valley Generating Station in Richmond, Indiana - 44 MW and 72 MW boilers, and

• AES Beaver Valley, LLC in Monaca, Pennsylvania - 43MW boiler. The Enviroplan analysis resulted in cost-effectiveness values for ROFA® with Rotamix® for control of NOx of $4,325/ton (15-year) and $5,886/ton (8-year). Most air pollution agencies would conclude that under the 15-year scenario, ROFA® with Rotamix® is cost effective as BART for NOx based on an emission limit of 0.11 lb/MMBTU, 30-day average. Under the 8-year scenario, the cost-effectiveness is in the gray area, although this $/ton value appears to be inflated. A review of the detailed cost calculations may identify specific cast items or values inconsistent with the EPA Control Cost Manual or which are otherwise unreasonable. Also, with an actual implementation timeframe of 1-2 years, the useful remaining useful life of the equipment would be increased to 10-11 years, resulting in a longer amortization period and lower annualized costs. Based on estimated final SIP approval in November 2012, an implementation timeframe of 2 years (per above discussion), and plant shutdown in 2024, the remaining useful life of Healy Unit 1 would be approximately 10 years. Increasing the amortization period to 10 years results in a NOx cost effectiveness value for ROFA® with Rotamix® of $5,207/ton, using the Enviroplan cost values. For cost-effectiveness values in this area, it is customary for evaluation of other environmental impacts to weigh more significantly in the BART determination, According to the vendor, operation of the ROFA F; with Rotamix® system to achieve an emission limit of 0.11 lb/MMBTU as quoted in the Enviroplan document is likely achievable but does carry some risk of increased CO, C0 2 , and loss-on-ignition (LOI) unburnt carbon particulate matter emissions. Data quantifying this risk is not readily available, since facilities employing ROFA® with Rotamix® are subject to higher emission limits. A review of facilities employing ROFA® with Rotamix® for NOx control revealed emission limits above 0.20 lb/MMBTU for older projects, with the most recent project identified subject to an emission limit of 0.14 lb/MMBTU(MPCA, 2006). Research did not identify a facility utilizing ROFA® with Rotamix® that was8

subject to an emission limit near 0.11 lh/MIvIBTU, so the relationship between NOx and GO/CO2/PM emissions under these circumstances remains unclear. The vendor reports that some facilities burning sub-bituminous coal (as does Healy) are able to meet 0.15 lb/MMBTU without employing the Rotamix® urea injection (SNCR) under certain operating conditions, but that operating the system to achieve the quoted 0.111b/MMBTU as an emission limit (applicable at all times) would likely incur operational difficulties. It appears that although the technology can meet the lower emission limit, air pollution agencies have employed a less restrictive limit, in an attempt to provide a reasonable compliance margin.
ROFA O The Enviroplan analysis resulted in cost-effectiveness values for ROFA® for control ofNOx of $3,476/ton (15-year) and $4,827/ton (8-year). I consider ROFAO to be costeffective for NOx control for this facility. Furthermore, ROFA® is an established technology for this application with minimal risk of significant secondary environmental impacts when operated to achieve 0.15 lb/MMBTU. BART for S02 The Enviroplan BART analysis identified the following options as technically feasible for control of S0; from Healy Unit 1, with the associated achievable 

### emission rates (30- day rolling average), emissions reductions, and visibility impacts: Control SOz Emission Tons Visibility Incremental Technology Rate

(lb/MMBTUr S02

Reduced Improvement

(dv, days) Visibility

Improvement (dv, days) Baseline (DSI) 0.30 0 0 0 DS1 Optimization 0.18 179 0.250 dv, 39 days 0.250 dv, 39 days Spray Dryer 0.15 223 -0.870 dv, 20 days clv, -1.120 -19 days Wet Flue Gas Desulfurization (MD) 0.07 343 -1.160 dv, 18 days -0.290 dv, -2 days

The following limits were provided by GVEA: 0.18 1b/1vlMBTU for DSI optimization, 0.15 lb/MMBTU for Spray Dryer, and 0.07 lb/MMBTU far Wet FGD.9

The following table summarizes the cost-effectiveness of the SO2 control technologies. Values are taken from the Enviroplan document unless otherwise noted. Incremental cost-effectiveness values are shown in italics. Cost-effectiveness for visibility improvement is shown in millions of dollars per deciview.

Control Limit 15-year 10-year9 8-year Technology lb/MMBTU Costs Costs Costs DSI 0.30 $0 $0 $0 Optimize DSI 0.18 $3,578/ton $3,932/ton $4,218/ton $3,578/ton $3,932/ton $4,218/ton $2.6M/dv $10.2M/d v $2.8M/dv

$11.3M/dv $3.0M/dv

$12.1M/dv Spray Dryer 0.1 $7,198/ton $8,417/ton $9,337/ton $21, 677/tor n $26, 662/ton $29,813/ton Cost-effectiveness values in terms of $/dv for spray dryer and wet FGD are meaningless due to negative "near field" modeled visibility impact from cooler

plume.
0.07 Wet FGD $7,763/ton $8,824/ton $9,165/ton

$10,554/ton $10,275/ton

$12.033/ton

g Calculations by Zach Hedgpeth, PE -Ten year facility remaining useful life was not evaluated in the Enviroplan report.10

Cost-effectiveness data for S02 under the 10-year facility remaining useful life scenario is depicted in the following chart.



### SO2 Cost-Effectiveness - 10-year Facility Lifetime

$/ton - - - - Incr. $/ton $15,000
vs. $20,000 -

$10,000 es f

r $3o,oao

$25,000

$5,000

$ 0 4 DS Optimize DSi Spray Dryer Wet FGD BART for SO2 as determined by Enviroplan and adopted by ADEC is an emission limit of 0.30 lb/MMBTU, 30-day average, as attainable by the DS] system as currently operated. 

### Wet Controls The two wet control options evaluated 

### by Enviroplan (Spray Dryer and Wet FGD) were both deemed cost-prohibitive based on the values above. Examination of the detailed cost calculations which produced these values was not possible for the reasons discussed above, but the costs are high enough to provide a reasonable level of confidence in the Enviroplan conclusions. It is unlikely that a review of the detailed costcalculations by Enviroplan would yield cost reductions sufficient to reach the costeffective range. In addition to cost considerations, the Enviroplan document describes increased "near field" visibility impacts due to reduced plume rise and dispersion resulting from the cooler exhaust gas temperature that would result from wet control technologies. Due to the proximity of the Healy plant to Denali National Park, it appears that despite significant reductions in S02 emissions resulting from wet control technologies, visibility impacts (as modeled) actually increase near to the plant.11

The Enviroplan report did not evaluate the addition of water spray to the existing dry scrubbing system. The addition of water spray to dry sorbent injection can be used to maximize SO2 removal efficiency (EPA, 2000 and 2003), and would likely be much more cost-effective than the new systems evaluated by Enviroplan. Regardless, despite reduced SO2 emissions, modeling would likely indicate increased visibility impacts near to the stack due to decreased plume dispersion, similar to the other wet scrubbing control technologies. DSI Optimization Emission reduction using the existing dry sorbent injection (DSI) system could be increased from 50% to around 70% by increasing the sorbent injection rate. This emission reduction is cost-effective (at $3,578/ton for a 15-year facility remaining useful life and $4,218/ton for an 8-year facility remaining useful life) and would result in visibility improvement of 0.25 deciviews over 39 days according to Enviroplan. However, increased sorbent injection rate carries the risk of a "brown plume" effect. Brown plume refers to the oxidation of nitrogen oxide (NO) to nitrogen dioxide (NO 2) prior to discharge from the stack. N02 is brown in color, while NO is colorless; the two together form NOx. Combustion emissions are primarily NO initially and oxidize in the atmosphere to NO 2

. High sorbent injection rates can increase the potential for this oxidation to occur prior to discharge. Based on a review of the literature, I agree with Enviroplan that the frequency of brown plume events and impacts to visibility at Denali National Park is not possible to predict precisely, although there is anecdotal evidence that such events occur at a small minority of facilities that utilize DSI for SO2 control (EPA, 2005 and Solvay, 2009). Unfortunately, the potential for brown plume events may result in under-utilization of DSI systems in achieving the maximum possible SO2 removal. Since Healy Unit 1 is already equipped with a DSI system capable of the necessary increased sorbent injection rate (although not continuously, due to lack of redundancy), good potential exists for a pilot study to evaluate the potential S02 reductions and brown plume risk without substantial expenditures. Pursuing such a pilot study may be complex in the BART context, and would likely require further technical work. If you have any questions about these comments, please call rue at 3-1217.

C: Mark Filippini, Unit Manager, ESU, OEA Debra Suzuki, Unit Manager, STAPU, OAWT Juliane Matthews, ORC12

References EPA, 2000. Srivistava Ravi K. Controlling SO2 Emissions: A Review ofTechnologies. USEnvironmental Protection Agency, Office of Research and Development. EPA/600/R00/093. EPA, 2002. EPA Air Pollution Control Cost Manual, Sixth Edition. US Environmental Protection Agency, Office of Air Quality Planning and Standards. EPA/452/B-02-001. http://www.epa.gov/ttn/catc/dirl/c allchs.pdf EPA, 2003. Air Pollution Control Technology Fact Sheet: Flue Gas Desulfurization - Wet, Spray-Dry and Dry Scrubbers. US Environmental Protection Agency, CICA. EPA-452/F03-034. http://v+1ww.ep

.a.gov/ttn/catc/dirt./ffdg.pdf EPA, 2005. Multipollutant Emission Control Technology Options for Coal-Fired Power Plants. US Environmental Protection Agency, Office of Research and Development. EPA-600/R-05/034. March 2005. http://nepis.epa.gov/EPA/lhtml/DLwait.htn ?url=/Adobe/PDF/90150MOO.PDF Fuel Tech, 2009, Golden Valley Electric Association, Healy Station Unit 1, Conceptual Application of Selective Catalytic Reduction (SCR) Technology. Fuel Tech, Inc. Warrenville, Illinois. June, 2009. ICAC, 2006. Typical Installation Timelines for NOx Control Technologies on Industrial Sources. Institute of Clean Air Companies. December 4, 2006. http://www.icac.com/files/public/ICAC NOx Control_Installation, Timing 120406.pdf
MPCA, 2006. Review of Minnesota Power's Arrowhead Regional Emission Abatement (AREA) Project. Minnesota Pollution Control Agency. January 17, 2006. http://www.pca.state.mn.us/i ndex.php/view-docurnent,htrnl?gid-13468Solvay, 2009. Comparison of Sodium Bicarbonate and Trona for S02 Mitigation at a CoalFired Power Plant. Yougen Kong and Jim Vsosky. Solvay Chemicals Inc. Presented at Electric Power 2009 Conference. May 12-14, 2009.