# Approval of Air Quality Implementation Plans; Navajo Nation; Regional Haze Requirements for Navajo Generating

Station

Final Rule

Responses to Comments on Proposal and Supplemental ProposalThis page intentionally left blank.

# Approval of Air Quality Implementation Plans; Navajo Nation; Regional Haze Requirements for Navajo Generating Station

Final Rule

Responses to Comments on Proposal and Supplemental Proposal

Air Division

Region IX U. S. Environmental Protection Agency San Francisco, CA 94105

July 28, 2014This page intentionally left blank.i 

## Table of Contents

Acronyms and Abbreviations .................................................................................................... ..... ii

1.0 Introduction .................................................................................................................. ......... 1

1.1 Background .................................................................................................................... 1

1.2 Public Comments ........................................................................................................... 1

1.3 Organization of This Document ..................................................................................... 2

2.0 Oral Testimony at the Public Hearin gs and Mass Comment Campaigns ............................. 3

2.1 Oral Testimony at the Public Hearings .......................................................................... 3

2.2 Mass Comment Campaigns ......................................................................................... 16

3.0 Comments on Factor One – Cost of Controls ..................................................................... 23

3.1 Comments on the Analysis of the Cost of SCR at NGS .............................................. 23

3.2 Other Comments on Factor One .................................................................................. 44

4.0 Comments on Factor Two – Economic, Energy, and Non-Air Quality Environmental Impacts ....................................................................................................................... ......... 44

4.1 Comments on Economic Impacts ................................................................................ 44

4.1.1 General Comments on Economic Impacts ......................................................... 45

4.1.2 Comments on the EPA’s Affordability Analysis ............................................... 57

4.2 Comments on Energy and Non-Air Quality Environmental Impacts .......................... 75

5.0 Comments on Factor Three – Ex isting Controls at NGS .................................................... 84

6.0 Comments on Factor Four – Remaining Useful Life of NGS ............................................. 87

7.0 Comments on Factor Five – Anticip ated Visibility Improvements .................................... 90

8.0 Comments on BART Determinations ............................................................................... 120

8.1 Comments on the Proposed BART Determination for NO x ...................................... 120

8.2 Comments on BART for PM ..................................................................................... 154

8.3 Comments on BART for SO 2 ..................................................................................... 157

8.4 Other Comments on BART ........................................................................................ 158

8.5 Comments on the EPA’s BART Alternative ............................................................. 160

8.6 Additional Alternativ es to BART .............................................................................. 183

9.0 Comments on the TWG Alternative and EPA’s Supplemental Proposal ......................... 192

10.0 Other Comments ............................................................................................................... 226

Appendix A: List of Written Comments ..................................................................................... 246ii 

## Acronyms and Abbreviations

Pollutants

CO 2 Carbon dioxide

H 2 SO 4 Sulfuric acid

HCl Hydrochloric acid

HF Hydrogen fluoride

NO x Nitrogen oxides

PM Particulate matter

PM 10 Particulate matter less than 10 micrometers

PM 2.5 Particulate matter less than 2.5 micrometers

SO 2 Sulfur dioxide

SO 3 Sulfur trioxide

Units

Btu British thermal unit

lb Pound

MMBtu Million British thermal units

MW Megawatt

MWh Megawatt hour

TBtu Trillion British thermal units

tpy Tons per year

Acronyms and Abbreviations

ADEQ Arizona Department of Environmental Quality

ANPR Advance Notice of Proposed Rulemaking

ALA American Lung Association

APA Administrative Procedure Act

APS Arizona Public Service

BACT Best Availabl e Control Technology

BART Best Available Retrofit Technology

BAU Business as usual

CAA Clean Air Act (42 U.S.C. 7401 - 7671q)iii 

## Acronyms and Abbreviations

CAMD Clean Air Markets Division (EPA)

CAP Central Arizona Project

CAWCD Central Arizona Wate r Conservation District

CEMS Continuous emissions monitoring system

CFR Code of Federal Regulations

CO Colorado

COMS Continuous opacity monitoring system

DC Circuit Federal Court of Appeals fo r the District of Columbia Circuit

DOI Department of the Interior

EGU Electric generating unit

EPA U.S. Environmental Protection Agency

EPRI Electric Power Research Institute

ESA Endangered Species Act

FCC Federal Communications Commission

FCPP Four Corners Power Plant

FIP Federal Implementation Plan

FLM Federal Land Manager

FR Federal Register

GHG Greenhouse Gas Emissions

IWAQM Interagency Workgroup on Air Quality Modeling

LADWP Los Angeles Department of Water and Power

LCRBDF Lower Colorado River Basin Development Fund

LNB Low NO x burner

MACT Maximum Achievable Control Technology

MATS Mercury and Ai r Toxics Standard

MPP Mohave Power Project

NAAQS National Ambient Air Quality Standards

NGS Navajo Generating Station

NM New Mexico

NPDES National Pollutant Discharge Elimination System

NREL National Renewa ble Energy Laboratoryiv 

## Acronyms and Abbreviations

NSPS New Source Performance Standard

NSR New Source Review

NVE NV Energy

OAR Office of Air and Radiation (EPA)

PSD Prevention of Significant Deterioration

RAVI BART Reasonably Attribut able Visibility Impairment Best Available Retrofit Technology

RHR Regional Haze Rule

SCR Selective catalytic reduction

SIP State Implementation Plan

SJGS San Juan Generating Station

SNCR Selective non-catalytic reduction

SOFA Separated over-fire air

SRP Salt River Project

TAR Tribal Authority Rule

TEP Tucson Electric Power Company

TIP Tribal Implementation Plan

TSD Technical Support Document

TWG Technical Work Group on NGS

U.S.C. United States Code

UARG Utility Air Regulatory Group

U.S. United States

WRAP Western Regiona l Air PartnershipPage 1

EPA Responses to Comments: Navajo Gene rating Station Final Rule | July 28, 2014 

## 1.0 Introduction

1.1 Background

On February 5, 2013, the U.S. Environmental Protection Agency (EPA or we) proposed a source-specific Federal Implemen tation Plan (FIP) requiring the Na vajo Generating Station (NGS), located on the Navajo Nation, to achieve emissions reductions required by the Clean Air Act’s (CAA’s)

Best Available Retrofit Technology (BART) provision. 1 In addition to our proposed BART determination, EPA also proposed a BART Alternativ e, put forth a framework for evaluating additional alternatives to BART, and invited stakeholders to submit other altern atives to EPA for consideration.

On July 26, 2013, a diverse group of stakeholders , known as the Technical Work Group on NGS (TWG), developed an agreement (TWG Agreement) th at included an alternativ e to BART (Appendix B to the TWG Agreement) and submitted it to EPA. EPA independently evaluated Appendix B to the TWG Agreement to determine if it meets the requ irements of the CAA and the Regional Haze Rule (RHR). In a Supplemental Proposal published in the Federal Register on October 22, 2013, EPA proposed to determine that requirem ents consistent with Appendix B to the TWG Agreement are “better

than BART” because it would ach ieve greater reasonable progre ss than EPA’s proposed BART determination towards the national visibility goal. 2 Throughout this document and our Final Rule, we refer to the requirements put fo rth in our Supplemental Proposal as the “TWG Alternative.”



### 1.2 Public Comments

In the February 2013 Proposed Rule, EPA provide d a 90-day public comment period, to close on May 6, 2013. At the request of severa l stakeholders working to devel op an alternative to BART, EPA provided several extensions of the public comment period. 3 In our October 2013 Supplemental Proposal,

EPA invited comment on the TWG Alternative concur rently with the open comment period on EPA’s Proposed Rule. The comment period fo r both proposals closed on January 6, 2014.

The EPA held five public hearings on the Proposed Rule and Supplemental Proposal on the Navajo Nation, on the Hopi Reservation, and in Arizona on November 12 – 15, 2013. In all, 194 oral testimonies were presented at the five hearings, although several individuals spoke at more than one hearing. The oral testimony is discussed further in S ection 2.1 of this document

We received approximately 77,000 written commen ts. Of these, approximately 76,800 comments came from individuals who responded to mass co mment campaigns by email or postcard. These

comments are discussed further in Section 2.2 of this document.

1 The proposed BART determination published in the Federal Register on February 5, 2013, in Volume 78, beginning on page 8,274 (78 FR 8274, February 5, 2013).

2 78 FR 62509 (October 22, 2013).

3 See 78 FR 16825 (March 19, 2013) that extended the comment period to August 5, 2013, 78 FR 41012 (July 9, 2013) that extended the comment period to October 4, 2013, and 78 FR 58987 (September 25, 2013) that extended the comment period to January 6, 2014. On June 19, 2013, EPA also announced our intention to hold five public hearings throughout Arizona to accept oral comment on our propos ed rulemaking (78 FR 36716).Page 2

EPA Responses to Comments: Navajo Gene rating Station Final Rule | July 28, 2014 We received an additional 300 unique written comments, not including duplicates from 261

different entities. These commenters can be broken down by type as follows: 8 tribal governments, 172 private individuals, 9 environmenta l and public interest advocacy groups , 8 CAP water interest groups, 26 industry/commerce entities, 1 federal agency, 24 stat e/local government entities , 12 elected officials, and the TWG. These comments are listed Appendix A. The comments are summarized by subject matter topics in Sections 3.0 through 10.0 of this document.

In addition to the comments submitted in writing and to the oral comments provided at the public hearings that have been transc ribed, EPA also received by mail a DVD of .mp4 files showing videos of eight individuals speaking about NGS. Two individuals were speak ing in Diné, the Navajo language, with another individual interpreti ng into English. The eight individuals are the same eight individuals listed as signatories of written comment 0403 that expresses opposition to the current and proposed operation of NGS and associated activities. 4 The written comment from these individuals is addressed elsewhere in this document (section 10.0). These video files are not in the electronic docket for this rulemaking, and EPA is not providing separate re sponses to the video comments because the eight

individuals did not raise any unique issues or concerns, related specifically to NGS and our proposed BART determination, that have not already been raised by other commenters through the public

comment process. 5



### 1.3 Organization of This Document

After this introductory section, this document includes nine additional sections as follows:

 Section 2.0 – Oral Testimony at the Public Hearing and Mass Comment Campaigns

 Section 3.0 – Comments on Factor One – Cost of Controls

 Section 4.0 – Comments on Factor Two – Economic, Energy, and Non-Air Quality Environmental Impacts

 Section 5.0 – Comments on Factor Th ree – Existing Controls at NGS

 Section 6.0 – Comments on Factor Four – Remaining Useful Life of NGS

 Section 7.0 – Comments on F actor Five – Anticipated Visibility Improvements

 Section 8.0 – Comments on BART Determinations

 Section 9.0 – Comments on the TWG Alternat ive and the EPA’s Supplemental Proposal

 Section 10.0 – Other Comments

4 Throughout this Response to Comments document, EPA refers to comments by the document number in the docket for this rule. For example, comment 0403 refers to document number 0403 in the docket at EPA-R09-OAR-2013-0009. See Appendix A for the full list of comments.

5 We note that one unique concern raised by several of the in dividuals was related to potential adverse air quality effects of coal fires at the Kayenta Mine that are allowed to burn or smolder. This comment is not related to EPA’s proposed BART determination for NGS. EPA notes that the Bureau of Reclamation has started its process to develop an Environmental Impact Statement (EIS) required under the National Environmental Protection Act (NEPA) for activities resulting from the continued operation of NGS and the Kayenta Mine. The on- going NEPA process provides numerous opportunities and the appropriate forum to raise concerns related to the impacts of coal fires at the Kayenta Mine.Page 3

EPA Responses to Comments: Navajo Gene rating Station Final Rule | July 28, 2014 

## 2.0 Oral Testimony at the Public Hearings and Mass Comment Campaigns

2.1 Oral Testimony at the Public Hearings

EPA held five public hearings in Arizona on November 12, 13, 14, and 15, 2013. In conjunction with each hearing (generally before the hearing), EPA held an open- house style information session to provide time for members of the public to talk with representatives from EPA about the Proposed Rule and Supplemental Proposal for NGS. EPA summarized the Proposed Rule and Supplemental Proposal in posters and handouts that were disp layed at each information session and hearing. EPA posted copies of the handouts and posters in the docket for the proposed rulemaking. 6 An interpreter for speakers of Diné, the Navajo language, was present for the informati on sessions and public h earings at the LeChee Chapter House and at Page High School.

In all, a total of 194 oral testimonies were presented at the five hearings, although several individuals spoke at more than one hearing. Most speakers spoke as private individuals, but many spoke as representatives of the interested industries (e. g., the co-owners of NGS and operator of the Kayenta Mine), environmental advocacy groups, public inte rest advocacy groups, and local governments. The location and time of each public hearing and inform ation session are given below, along with the number and types of speakers at each hearing.



## PUBLIC HEARINGS AND INFORMATION SESSIONS

Time

Date Venue (with Transcript Docket Number) Info

Session Public Hearing Commenters

Nov. 12 LeChee Chapter House LeChee, Arizona (EPA-R09-OAR-2013-0009-0426) 10 a.m. – 1 p.m. (concurrent) Private individuals – 22 Industry/Commerce – 1

Government – 4

Nov. 12 Page High Cultural Arts Building Page, Arizona (EPA-R09-OAR-2013-0009-0427 3 – 5

p.m. 6 – 9

p.m. Private individuals – 22 Industry/Commerce – 10

Government – 3

Nov. 13 Hopi Day School Kykotsmovi, Arizona (EPA-R09-OAR-2013-0009-0428) 3 – 5

p.m. 6 – 9

p.m. Private individuals – 18 Industry/ Commerce – 11

Environmental/ Public

interest – 7

Government – 1

Nov. 14 Phoenix Convention Center Phoenix, Arizona (EPA-R09-OAR-2013-0009-0429) 3 – 5

p.m. 6 – 10

p.m. Private individuals – 37 Industry/Commerce – 16

Environmental/ Public

interest – 8

Government – 8

6 See document number 0219 in the docket (docket number EPA-R09-OAR-2013-0009) for the proposed rulemaking at www.regulations.gov (i.e., EPA-R09-OAR-2013-0009-0219).Page 4

EPA Responses to Comments: Navajo Gene rating Station Final Rule | July 28, 2014 

## PUBLIC HEARINGS AND INFORMATION SESSIONS

Time

Date Venue (with Transcript Docket Number) Info

Session Public Hearing Commenters

Nov. 15 Pima Community College Tucson, Arizona (EPA-R09-OAR-2013-0009-0430) 3 – 5

p.m. 6 – 9

p.m. Private individuals – 26 Industry/Commerce – 11

Environmental/Public

interest – 7

Government – 1

The comments presented in oral testimony at the public hearings are summarized below, with the exception of comments from entities that submitted writ ten comments for those cases where the written comments duplicated their oral testimony. For exam ple, TWG submitted written comments that are summarized in the other sections of this document; th erefore their oral comments on the same topics are

not included in this section. Numer ous individuals provided oral comments at the public hearings that are similar to or duplicative of comments made by different individuals or entities in writing. For example, during the public hearing, nu merous individuals noted the cont ribution of NGS to the local and state economy, or supported the development of renewable energy to replace NGS. Because these comments were the same as the major topics from the public hearings, they are summarized in the Public Hearing section of this document. However, sim ilar comments also appear in later sections of this

document that describe comments submitted in writ ing (e.g., Section 4.0). The comments at all of the hearings followed similar themes and are genera lly treated together in the following summaries.

Comment: Contribution of NGS to the local and state economy and support for TWG Alternative

Many commenters preferred the TWG Alternativ e because they believe that EPA’s proposed

BART determination would force NGS and its associat ed mine (i.e., the Kayenta Mine) to close, causing economic harm to an area where the majority of re sidents are low-income a nd where opportunities for employment are limited, particularly for young peopl e. Many of these commenters cautioned EPA to carefully balance the environmental benefit of a ny requirement for NGS with the potential economic harm to the Navajo Nation and Hopi Tribe. Thes e commenters stressed that NGS employs over 500 people and the Kayenta Mine has over 400 employees, and the loss of these jobs would only exacerbate the unemployment rate in the area, which curren tly ranges from 47 percent to 60 percent. A few commenters related personal experiences and descri bed how the shutdown of other coal-fired power plants and mines (e.g., Mohave Power Project and the Black Mesa Mine) affected their ability to find employment and provide for their families. One co mmenter discussed how the lack of employment opportunities in the area combined with the closure of the NGS plant w ould increase the crime rate in the area, which currently stands at 24 percent.

Several commenters emphasized that in add ition to offering employ ment opportunities, NGS provides substantial economic benefi t to Tribes and the State of Ar izona. Many commenters highlighted that NGS’s payments to the Navajo Nation make up a large portion of the Na tion’s budget. However, some commenters challenged the claim that the Natio n’s budget is limited and th e Nation relies on coal

revenues to function. One commenter a sserted that only 36 per cent of the general f unds come from coal

revenues. Another commenter mentioned two articles: on e that reported that th e Navajo Nation returned over $14.5 million of federal funding allocated for diabet es programs, and another article that reportedPage 5

EPA Responses to Comments: Navajo Gene rating Station Final Rule | July 28, 2014 that the Navajo Nation returned over $16 millio n of federal funding allocated for workforce development. Several commenters cited an Arizon a State University (ASU) economic impact study which projected that NGS and its associated mine w ill indirectly account for more than $20 billion in gross state product and over $679 million in adjust ed state tax revenues between 2011 and 2044, while generating over 3,000 jobs annually. One commenter noted that NGS currently pays about $52 million per year in total wages to its 538 employees. Anothe r commenter stated that the Kayenta Mine alone contributes roughly $117 million annua lly to the region through royalties, business payments, and

wages.

A number of commenters disc ussed educational benefits fr om NGS contributions (e.g., scholarships for Native American students) and stressed that without this fina ncial assistance many local

residents would not be able to afford to send thei r children to college. Othe rs discussed the potential impact to businesses and the real es tate market if NGS were to clos e. One commenter reported that the gold industry contributes over $3.5 bill ion to the State of Arizona and would be heavily impacted if

water rates increased as a result of NGS closing. The commenter projec ted that higher rates would force these institutions to shut down contributing to a loss of more than 20,000 jobs in the area. A few

commenters contended that the decline in business revenue and property valu es in and around the NGS area is largely due to residents’ fear that NGS will shut down. According to one commenter, in 2007 the average home price was $255,000 and today it is $184,000. The commenter added that during the same period manufactured homes, which make up the majo rity of homes in the area declined from $122,000 to $106,000. Another commenter added that a decline in housing prices would negatively impact property taxes which subsidize facil ities, like Page Hospital. The co mmenter noted that Page Hospital currently contributes roughly $9.2 million annually to th e city in both direct and indirect spending (e.g., salaries, housing, and utilities).

Several commenters favor the TWG Alternativ e because they believe that EPA’s proposed BART determination will make it economically impossibl e for NGS to continue to operate; thus, would impact their ability to receive affo rdable and reliable energy and water in the future. A number of these commenters noted that NGS currently supplies more than 90 percent of the energy used by Central

Arizona Water Conservation Distri ct (CAWCD), which operates the Central Arizona Project (CAP)

which transfers water from the Colorado River th roughout Arizona. One commenter asserted that the EPA’s proposed regulation could potentially add $1.1 billion in costs to Arizona’s water and power bills. A co-owner of NGS argued that the installa tion of SCR would cost the plant $400 to $544 million, possibly up to $1 billion, of which $8 to $5 million w ould be passed down to its customers, resulting in higher rates during a time where most communities are still recovering from the recent recession. These commenters stressed that higher rates would be part icularly damaging to thos e individuals living on fixed incomes, such as the elderl y. A few commenters urged EPA to uphold its federal trust obligations

and ensure that tribal communities continue to ha ve access to affordable water, and advised EPA to make a decision consistent with the legal rights that the Gila River Indi an Community and other stakeholders bargained for and that Congress gran ted under the Arizona Water Settlements Act of 2004.

A few commenters support the TWG Alternative b ecause they believe it is a fair compromise created by a diverse group of st akeholders (e.g., the Navajo Na tion, industry, and environmental groups), which provides a path for future operation at NGS by allowing for pot ential ownership changes and by providing an appropriate timeframe to insta ll SCR technology, while still ensuring that the total

emission reductions of NO x will be greater than those achieved under EPA’s proposed BART determination. On the other hand, some commenters, pa rticularly Hopi, expresse d frustration that they were not appropriately involved in the formation of the proposed al ternative. However, many of the commenters at the hearings urged EPA to approve the TWG Alternative and move forward with thePage 6

EPA Responses to Comments: Navajo Gene rating Station Final Rule | July 28, 2014 final rule as soon as possible. Many of these comm enters believe that EPA’s proposal is overreaching and represents a threat to states’ rights and hinders their ability to d eal with environmental issues on a local level, and some urged the EPA to allow for Navajo EPA and the Navajo Nation Department of

Justice to take on th e role of regulator.

Response:

EPA recognizes the contribution of NGS and the Kayenta Mine to the economy of the Navajo Nation, the Hopi Tribe, the city of Page, and the state of Arizona. In our notice of proposed rulemaking, EPA discussed the history of NGS and the relationsh ip between NGS, the Central Arizona Project, and

numerous tribes located in Arizona. 7 EPA also recognizes that NGS is a facility that is subject to the BART requirement of the Regional Haze Rule, and emi ssions from NGS affect visibility at 11 national parks and wilderness areas in the Southwest. As discussed in our Pr oposed Rule and in our Supplemental Proposal, for a number of reasons, incl uding the importance of NGS to numerous Indian tribes located in Arizona and the federal governm ent’s reliance on NGS to meet the requirements of water settlements with several tribes, EPA outlined a framework for considering “better than BART”

alternatives that ensure emission reductions while providing additional flexibility in the compliance timeframe to the operator of NGS. 8

EPA disagrees with assertions that we are overre aching and threatening stat es’ rights and states’ ability to address enviro nmental issues on a local level. As di scussed in our Proposed Rule, NGS is located on the Navajo Nation and the state of Arizona does not have regulatory authority over facilities located on the Navajo Nation. EPA further noted in our proposals that the Na vajo Nation EPA has not sought to develop a Tribal Implementation Plan to regulate NGS. Because NGS is a subject-to-BART source that would undergo a BART de termination if located on state land, and based on the importance of visibility to the national parks and wilderness areas located in th e Southwestern United States, EPA proposed to find that a BART determination was “n ecessary or appropriate” under the Tribal Authority

Rule. 9

EPA understands the frustrations expressed by se veral commenters, including the Hopi Tribe, regarding limited stakeholder particip ation in the TWG. EPA was not in volved in the formation of the TWG or in any of the discussions of the TWG. 10 Our docket for this rulemaki ng includes letters that the Hope Tribe sent to the Department of the Interi or following submittal of the TWG Alternative to EPA. 11
EPA participated in a telephone conf erence with Hopi Tribal leaders to hear their con cerns about the TWG as well as formal consultation following our Supplemental Proposal. 12

In our proposed rulemaking, EPA put forth a fram ework for “better than BART” alternatives and invited suggestions for other alternatives that reduce NO x emissions at NGS a nd its contribution to visibility impairment while providing long-term sust ainable benefits to trib es. Although EPA recognizes

that the members of the TWG did not invite all affect ed stakeholders to partic ipate in their discussions, EPA does agree with comments that the TWG Agreem ent represents a compromise between diverse

7 See 78 FR at 8275 (February 5, 2013).

8 Id. and 78 FR 62509 (October 22, 2013).

9 See 78 FR at 8279 (February 5, 2013) and 40 CFR 49.11.

10 At their request, EPA presented an overview of our proposed BART determination on March 21, 2013 to the stakeholders that formed the Technical Work Group. See EPA memo to file (document number 0033) in the docket for the proposed rulemaking at http://www.regulations.gov/#! documentDetail;D=EPA-R09-OAR-2013-0009-0033.

11 See, for example, document number 0151 in the docket for this rulemaking at EPA-R09-OAR-2013-0009.

12 See documents 0166 and 0303 in the docket for this rulemaking.Page 7

EPA Responses to Comments: Navajo Gene rating Station Final Rule | July 28, 2014 stakeholders. Our Supplemental Proposal of the TWG Alternative, consistent with Appendix B of the TWG Agreement, provides certainty for future operation of NGS, flexibility in the compliance timeframe, and more emission reductions of NO x than would have been achieved under EPA’s proposed BART determination. Based on our analysis in ou r Supplemental Proposal a nd consideration of all comments received, EPA is taking acti on to finalize the TWG Alternativ e, including a cap in lifetime

emissions of NO x from NGS over 2009-2044 (2009-2044 NO x Cap). EPA is also finalizing a BART

Benchmark as the basis for the 2009-2044 NO x Cap in the TWG Alternative. The BART Benchmark is based on our proposed BART determination for NGS.

Comment: Impact of air pollutants from NGS on public health and welfare and support for proposed

BART determination

Several commenters favor EPA’s proposed BART determination or more stringent requirements for NGS because they believe that emissions from the plant cause hea lth problems in the area, such as respiratory illness and heart disease. These commen ters noted that the Navajo and Hopi communities, particularly children and the elderly who live closes t to the plant, are the most susceptible to the pollutants emitted. According to one commenter, approximately 213,000 children live near the NGS plant. One commenter asserted that 19 percent of the children living in Pa ge, Arizona suffer from neurological complications, which is two times higher than average, a nd 98 percent of those children are Native Americans. Some commenters emphasized th at Native Americans have the shortest life expectancies in this country, which they believe is a direct result of the pollution produced by nearby plants. One commenter cited a Clean Air Task For ce study which states that NGS is responsible for approximately $127 million in health costs every year. Many of these commenters urged EPA to

conduct health studies to determine the actua l impact to health on these communities.

Many commenters spoke in support of stringent requirements and controls on NGS because they believe emissions from the plant co ntribute haze, which impairs air quality and visibility in the 11 national parks (e.g., Grand Canyon and Petrified Forest ) and wilderness areas surrounding the plant. Many discussed the importance of tourism to th e economy of the area and claimed that the haze produced from NGS diminishes the beauty of the re gion and quality of life for residents. A few commenters highlighted the fact that the NGS plant is over 40 years old and ur ged EPA to require plant operators to update the plant with cleaner and mo re efficient technology. These commenters emphasized that NGS is one of the worst polluting coal -fired power plants in the United States.

Some commenters favor stringent requirements and controls on NGS beca use they believe that emissions from the plant are negatively impacting th e land and the water in the area. Some living near the plant believe that it is responsible for killing native plants species that they depend on for their livestock, and has harmed traditional dry land farming. Others claimed that emissions from the plant can be linked to high levels of mercur y found in fish species located in nearby lakes (e.g., Lake Powell and Wheat Fields Lake). Many commenters, particularly residents living on Black Mesa, expressed their concerns over the wellbeing of th eir sole source of drinking water, the Navajo Aquifer that, once contaminated, will force residents out of the area. A few commenters discussed how coal is transported to the NGS plant and noted that the pipeline used to transport a slurry of pul verized coal requires over 3.3 million gallons per day of water often pulled from th e Navajo Aquifer, which they believe is unfair considering most of the resident s in the area do not have access to water and electricity. These commenters encouraged EPA to properl y monitor local aquifers to ensure that the water quality remains high.Page 8

EPA Responses to Comments: Navajo Gene rating Station Final Rule | July 28, 2014 A number of commenters favor stringent requ irements and controls on NGS because they believe that emissions produced from the plant are contributing to climate change. Several of these commenters cited reports and studies , including the Intergovernmental Panel on Climate Change report and the Climate Vulnerability Monitor study, as proof th at climate change is real and largely manmade.

One commenter asserted that low le vels of electricity production at H oover Dam due to low water levels demonstrate that climate change is occurring.

A few commenters questioned the extent to wh ich NGS emissions are impacting public health and the environment, instead blaming the haze on emissions from natural sources (e.g., volcanoes, wind/dust storms, and forest fires) and pollution from nearby cities (i .e., Phoenix, Los Angeles, and Las Vegas). One commenter noted that a single volcanic eruption has the potential to emit more emissions than 10,000 years of human activity. A nother commenter stated that EPA’ s website states that vehicles are the largest producers of NO x emissions in the country and imp lied that EPA is unfairly targeting power plants rather than addres sing emissions from vehicles. The commenter added that in 2012 over 4.5 million people visited the Grand Canyon, which meant 1.5 million vehicles traveled to and from the national park, assuming each car acc ommodated 3 people. The commenter further noted that EPA’s

website states that NO x emissions have declined by mo re than 40 percent since 1980.

A limited number of commenters preferred EP A’s proposed BART determination over the TWG Alternative because they believe that the alternative is based on a false premise. They asserted that the shutdown of a single unit is not equi valent to cleaning up all three un its, because the energy lost from the shutdown will ultimately need to be produced elsewhere, since the de mand for power does not change. One commenter highlighted that the Nava jo Nation is surrounded by seven coal-fired power plants that collectively produced 106,942 tons of NO x in 2011 and concluded that the shutdown of one unit at NGS will have no significant impact on visibility.

A few commenters support stringent requirements and controls on NGS because they believe that the TWG Alternative provides no certainty or co mmitment that any of the units will actually be retired early. Many argued that NGS has known a bout the possible change in ownership, NEPA requirements, and requirements to control emissions fo r years but chose not to ad dress these issues until

now. A few commenters adde d that FCPP was in a similar situ ation, but unlike NGS, EPA proposed a BART alternative with concrete compliance deadlin es and a much shorter time frame. One commenter urged the EPA to use its discretion to improve th e TWG Alternative by shortening the compliance time frame and provide a concrete pathway for emissions re duction that can be anticipated as they transition to clean, renewable energy in nor thern Arizona. Another commenter noted that neither EPA nor TWG has provided visibility modeling to compare the new proposal to EPA’s original proposal. Further, the U.S. Bureau of Reclamation has made a public commitment to reduce pollution emitted from NGS by eventually transitioning it from coal to cleaner energy, which should be considered.

Response:

Protection of human health and the environmen t is EPA’s mission, and forms the basis for many Agency actions, including estab lishing the National Ambient Air Qu ality Standards (NAAQS), and promulgation of regulations such as the New So urce Performance Standards (NSPS) and the National Emission Standards for Hazardous Air Pollutants (NESHA P). In addition to Clean Air Act requirements to protect human health, in the 1977 Clean Air Act Amendments, Congress also declared as a national goal the prevention of any future, and the remedying of any existing, impairment of visibility in mandatory class I Federal areas which impairment results from manmade air pollution (See CAA §169A). In 1999, EPA issued the final Regional Haze Ru le (RHR), which included the requirement forPage 9

EPA Responses to Comments: Navajo Gene rating Station Final Rule | July 28, 2014 facilities of a certain age to install the Best Available Retrof it Technology (BART) to reduce emissions of visibility-impairing pollutants. Therefore, the focu s of implementation pl ans developed under the RHR, is to reduce visibility impairment, resultin g from stationary sources, at National Parks and Wilderness Areas. EPA agrees that visibility-impai ring pollutants are among th e same pollutants that affect human and ecosystem health. Although health studies may provide useful information, these studies are beyond the scope of a BART analysis. Emi ssions of hazardous air pollutants such as mercury are not visibility-impairing pollutants, and as a result are beyond the scope of our BART analysis. Emissions of hazardous air pollutants (HAPs) from various source categories are addressed generally through National Emission Standards for Hazardous Air Pollutants (NESHAPs) and EPA addresses mercury emissions from power plants specifically in the final Mercury and Air Toxics (MATS) Rule which was published in the Federal Register on February 16, 2012 (77 FR 9304). On April 15, 2014, the Court of Appeals for the Distri ct of Columbia Circ uit upheld EPA’s promul gation of the Rule. 13

EPA agrees with comments that mining and com bustion of coal affect the environment. EPA

notes that the Bureau of Reclama tion has started its environmental im pact review process required under the National Environmental Protection Act (NEPA) for activities resulting from the continued operation of NGS and the Kayenta Mine that is triggered by the renewal of vari ous leases and other rights of

way. 14 The on-going NEPA process provides numerous opportu nities and the appropriate forum to raise concerns related to the impacts of mining and use of water from the Navajo Aquifer. EPA further notes that coal is transported from the Kayenta Mine to NGS via a dedicated electric rail line. Regarding concerns raised over the use of water from the Navajo Aquifer to transport coal in a slurry, EPA notes that this practice was used to transport coal from the Black Mesa Mine to the Mohave Generating

Station in Nevada and was discontinued when the Mohave Generating Station closed in 2005.

EPA agrees that climate change is happening and humans are largely responsible for recent climate change. 15 EPA notes that the RHR addresses pollutants that impair visibility and is not intended to address pollutants that contribute to climat e change. EPA has developed various programs and activities to address emissions of greenhouse gases. 16 For example, on June 2, 2014, EPA signed a proposal to cut carbon emissions from existing power plants. 17

EPA also agrees that stationary sources, such as power plants, represent one of many sources that contribute to regional haze and visibility impairment at Class I areas. EPA notes that in Section 169A of the CAA, Congress directed EPA to develop regulations that, am ong other things, required major stationary sources, in existence between 1962 to 1977, to install BART. Several commenters asserted

that mobile vehicle emissions contribute more to vi sibility impairment than stationary sources, and implied that EPA is unfairly targeting stationary s ource emissions while doing nothing to control mobile source emissions. EPA disagrees with the assertion that EPA is not controlling mobile sources of emissions. Consistent with title II of the CAA, the EPA Office of Transportation and Air Quality protects public health and air quality by, among ot her things, regulating air pollution from motor vehicles, engines, and the fuels to operate them. 18 As a result of EPA’s actions and requirements, new cars and sport utility vehicles sold toda y have emission leve ls of hydrocarbons, NO x , and carbon

13 See document titled “White Stallion Energy Center, LLC v. EPA” in the docket for this rulemaking.

14 See www.ngskmc-eis.net

15 http://www.epa.gov/climatechange/basics/

16 http://www.epa.gov/climatechange/EPAactivities.html

17 See http://www2.epa.gov/car bon-pollution-standards.

18 http://www.epa.gov/otaq/Page 10

EPA Responses to Comments: Navajo Gene rating Station Final Rule | July 28, 2014 monoxide that are 98 – 99 percent lower than new vehicles sold in the 1960s on a per mile basis. 19
Similarly, standards established for heavy-duty hi ghway and non-road sources require emission rate reductions on the order of 90 percent or more for particulate matter and NO x . In 2014, EPA finalized

new vehicle emission standards and reduced the fuel sulfur content of gasolin e to achieve additional reductions in tailpipe and evaporative emissions fr om passenger cars, light-duty vehicles, medium-duty passenger cars, and some heavy- duty vehicles starting in 2017. 20

EPA agrees that forest fires and volcanic eruptions , when they occur, can impact visibility to a greater extent than anthr opogenic sources of emissions. However, th e possibility that sources outside of human control exist and can have large impacts on visi bility on an episodic basis does not negate the fact that stationary sources cont ribute to visibility impairment, a nd that Congress directed EPA to develop rules to address these em issions for the purpose of remedying the existing impairment of visibility in Class I areas and restor ing visibility to natural conditions.

EPA disagrees with assertions that the TWG Alte rnative is based on a false premise because the closure or curtailment of one unit would just result in electricity produced elsewh ere. EPA notes that the portion of the TWG Agreement that calls for closur e of one unit or curtailment at NGS was possible because of decisions by the Los Angeles Departme nt of Water and Power and NV Energy to exit NGS and replace that electricity with power gene rated by natural gas and renewable sources. 21 Therefore, any additional electricity needed to replace lost ge neration from NGS associated with LADWP and NV Energy’s divestiture would come from energy sources that emit less air pollution than a conventional coal-fired power plant operating with SCR on all un its. EPA agrees that ther e are several coal-fired power plants near the Navajo Nati on, and EPA also agrees with the commenter that the closure of one unit alone will not be better than installation of SCR on Unit 1-3 at NGS. However, EPA notes that the TWG Alternative includes not only closure of one unit, but will achieve emission reductions through the

installation of SCR on two units in 2030. Taken together, the TWG A lternative will achieve greater

emission reductions over 2009-2044 than would have been achieved under our BART determination. Although some commenters requested that EPA shorten the timeframe for compliance under the TWG Alternative, other commenters re quested that EPA extend the TWG Alternative compliance timeframe. As presented in our Supplemental Proposal and as discussed in Section 9.0 of this Response to Comments document, EPA’s analysis of the TWG Alte rnative shows that the tim eframes for closure or curtailment, and installation of SCR are appropriate to allow the operator of NGS to maintain total NO x emissions from the TWG Alternative below emissi ons that would have been achieved under BART.

In addition, EPA disagrees with commenters that there is no certainty in the TWG Alternative. Our Supplemental Proposal defines various requ irements in the TWG Alternative, including requirements to meet a cap in NO x emissions over 2009-2044 (2009-2044 NO x Cap) through one of four options: (1) permanently cease opera tion of one coal-fired unit by December 31, 2019 and comply with

an emission limit of 0.07 lb/MMBtu on each of the two remaining coal-fired units by December 31, 2030 (see proposed regulatory te xt in Supplemental Proposal for Alternative A1: 40 CFR 49.5513(j)(3)(i)(A)); or (2) pe rmanently cease operation of one co al-fired unit with the option to increase net generating capacity by no more th an 189 MW by December 31, 2019 and comply with an

19 See, e.g., 76 FR 74854, at 74900 (December 1, 2011)

20 See Fact Sheet for Tier 3 Standards available at http://www.epa.gov/otaq/documents/tier3/420f14010.pdf

21 See document titled “LADWP-Navajo+IPP Coal Elimination Presentation 031913” in the docket for this rule. See also

section 7 of Nevada SB 123 available at http://www.leg.state.nv.us/Session /77th2013/Bills/SB/SB123_EN.pdf , requiring NV Energy to retire or eliminate not less th an 250 MW of generating capacity on or be fore December 31, 2019. NV Energy ownsapproximately 254 MW of generating capacity at NGS. See also: http://www.lasvegassun.com/news/2013/apr/02/nv-energydecommission-coal-plants-shift-gas-and-r/Page 11

EPA Responses to Comments: Navajo Gene rating Station Final Rule | July 28, 2014 emission limit of 0.07 lb/MMBtu on each of the tw o remaining coal-fired units by December 31, 2030 (see proposed regulatory text in Supplemental Proposal for Alternat ive A2: 40 CFR 49.5513(j)(3)(i)(B)); or (3) reduce net generating cap acity of NGS by no less than 561 MW by December 31, 2019 and comply with an emission limit of 0.07 lb/MMBtu on two coal-fired units by December 31, 2030 (see proposed regulatory text in Supplemental Proposal fo r Alternative A3: 40 CF R 49.5513(j)(3)(i)(C)); or (4) in addition to the 2009-2044 NO x Cap, comply with a cap in NO x emissions that applies over 2009- 2029 that is equivalent to emissions over that period under Alternative A1 (2009-2029 NO x Cap) (see proposed regulatory text in Supplemental Proposal for Alternative B: 40 CF R 49.5513(j)(3)(i)(D)). The

2009-2044 NO x Cap and the 2009-2029 NO x Cap are both enforceable, and thus, both ensure that NGS is operated in a manner such that total NO x emissions are lower than what would have been achieved

under BART.

EPA agrees with commenters that it seems likel y that the operator and owners of NGS were aware of environmental requirements under developm ent and that leases and other rights-of-way agreements needed to be renewed prior to expira tion in 2019, raising the possibility of changes in ownership of NGS. EPA recognizes that the FIP for the Four Corners Po wer Plant included an

alternative to BART that included closure of three units by 2014 and in stallation of SCR on the remaining two units by July 31, 2018. EPA notes that both NGS and FCPP ar e located on the Navajo Nation, and pursuant to the Trib al Authority Rule, EPA proposed to determine that a BART

determination for NO x was necessary or appropriate. Both th e FCPP and NGS contribute to the Navajo

Nation in terms of revenue and em ployment, however, NGS is unique be cause of its critical importance to the Navajo Nation as well as other tribes, includ ing the Hopi Tribe, and nu merous tribes receiving CAP water through Congressional water settlement acts. EPA appreciates th e sentiment expressed by several commenters requesting a transition to re newable energy sources in northern Arizona and acknowledges the commitments made by the Bureau of Reclamation regarding transitions to cleaner energy sources; however, EPA does not have authority through BART to redefine a source and require it to change its method of electric ity generation. The comment regarding visibility modeling of the TWG

Alternative is discussed in Section 9.0.

Comment: Support for renewable energy to replace NGS

A number of commenters consider the proposed BART requirements and controls on NGS as a first step in transitioning away fr om coal-fired power plants to renewable energy sources. Commenters enumerated many problems with coal as an ener gy source, including air pollution emissions (SO 2 , NO x , PM, mercury and other toxic compounds, acid gases, and GHGs) that harm ecosystems.

Several commenters favor stringe nt requirements and controls on NGS because they believe that the production of renewable energy could economica lly benefit the Navajo Nation. Some commenters asserted that 900 megawatts of rene wable energy can create the same number of jobs and opportunities

that one coal unit does. One commenter claimed that the production of coal av erages about 6 jobs per million dollars invested, while solar and wind produc tion generates about 13 jobs per million dollars

invested. Another commenter stresse d that the Black Mesa region’s 13,000 acres of already reclaimed mine land and 25,000 acres of land scheduled for recl amation could generate 6,000 megawatts of solar power; thus creating 2,800 operation al jobs and 30,000 temporary jobs. One commenter mentioned that stock values in two of the larges t U.S. coal producing companies, Peabody and Arch, has dropped by 75 percent, which coincides with a drop in solar panel costs, and is proof that more and more utilities are switching to cost-efficient alternatives.Page 12

EPA Responses to Comments: Navajo Gene rating Station Final Rule | July 28, 2014 A few commenters support stringent requirements and controls on NGS because they believe that Arizona is ideally suited for solar and wind energy projects. One commenter noted that Tucson Electric Power (TEP) currently has a 50-megawatt sola r power plant in New Mexico Macho Springs that provides clean, efficient solar power to the area, which the commenter be lieves could be replicated in Arizona. By the same token, one commenter discusse d how the military and uni versities are now taking advantage of “green” alternatives; specifically, ASU ha s installed solar panels across its four campuses and the ASU Research Park, allowing it to have 21- megawatts of solar capacity. A few commenters discussed the benefits they receive from solar panels on their home s and land, including lower electricity rates. A number of commenters cited a 2013 poll c onducted by Colorado College that stated that 74 percent of Arizona voters picked so lar as their first or second choi ce of energy source, with 43 percent favoring wind, 20 percent natural gas, and only 6 percent coal.

On the other hand, a few commenters believe that the replacement of coal with alternative energy sources, particularly natural gas, is not a viable solution because of the unknowns associated with the use of these alternatives (e.g., cost and environment impacts). They not ed that natural gas prices are higher and far more volatile than coal, which would only amplify as competition for gas rises in the future as companies switch to na tural gas as restrictions on coal production continue to increase. One commenter noted that Arizona’s coal prices to produce power have reached $1.70 per million Btu compared to $5.40 for natural gas, since 2000, and cu rrently over 40 percent of Arizona homes use natural gas for heating which causes demand for natura l gas to rise seven-fold during the winter. The commenter emphasized that Arizona imports virtually all of its natural gas from New Mexico where production has plummeted by 75 percent since 2006, a nd the demand for gas by states like California and Nevada continues to grow . The commenter mentioned PIRA Energy Group, a leading energy analytic firm, which projected that the demand for gas could exceed 14 trillion cubic feet by 2025, while Dow Chemical forecasts 90 industrial projects alone using 2.6 trillion cubic feet more by 2020. The commenter warned that the demand for natural gas w ill also continue to expand globally as the demand for gas continues to surge in the United States. Th e commenter explained that the DOE has approved 20 liquefied natural gas (LNG) export ap plications that will send 20 Bcf/day of gas to Europe and Asia, which is a third of all U.S. output, in addition to ga s piped to Mexico which will triple to 6 Bcf/day by 2020. Another commenter expressed concerns over the chemicals used to operate SCR, in particular ammonia, which has the potential to negativel y impact the area if a spill were to occur.

Response:

EPA recognizes that numerous commenters support renewable energy development on the Navajo Nation or elsewhere in Arizona to repl ace NGS, however, we note that EPA does not have authority under BART to redefine a source, i.e., for the purposes ofBART, EPA cannot require a coalfired power plant to convert to na tural gas or renewable energy gene ration. We agree with commenters that coal-fired power plants emit numerous air polluta nts that affect visibili ty, human health, and the environment. Through the RHR and BA RT, EPA and states are requiring stationary sources of a certain age that cause or contribute to visibility-impairment in Class I areas to install BART to reduce emissions of visibility-impairing pollution.

EPA also recognizes that some commenters do not support replacement of coal with natural gas due to the price volatility and increasing demand fo r natural gas. EPA notes that our analysis (as discussed in our Proposed Rule a nd in Section 4.1 of this Response to Comments document) indicates that EPA’s proposed BART determination would not fo rce NGS to close, nor does our Proposed Rule or Supplemental Proposal require NGS to convert to natu ral gas. Decisions by two of the existing owners of NGS to divest from coal-fired power are related to state law in California and Nevada and are not aPage 13

EPA Responses to Comments: Navajo Gene rating Station Final Rule | July 28, 2014 requirement of EPA or the RHR. EPA understands th e commenter’s concern over the use of ammonia to operate SCR. In the TSD for our Proposed Rule, EPA discussed the risks associated with transportation and storage of ammonia and noted th at SCR is a widely used control technology and that a review of the National Toxic Substance Incidents Program of the U.S. Agency for Toxic Substances and Disease Registry shows that over 2005-2010, there were no accide nts or spills involving transport or use of anhydrous ammonia at power plants. Of the 45 inci dents reported over 2005 to 2010, all incidents of release were associated with ag ricultural use of anhydrous ammonia. 22

Comment: Other Air Pollution Control Technologies

One commenter discussed the benefits achieved by an alternative emi ssions control technology known as the CEFCO process, a practice of comb ining Ewan technology with the patented Cooper Process and encouraged EPA to consider this as a possible alternative practice. The commenter argued that this practice exceeds the current BACT comp liance requirements by re moving over 99 percent of mercury, PM, SO x , NO x , and other trace metals, along with removing over 90 percent of CO 2 emissions. According to the commenter, this process is able to convert CO 2 emissions into usable fuels, tertiaryenhanced oil recovery, or enhanced ve getable crop growth. In regards to NO x , the commenter claimed that this process could reduce emissions below 0.01 pounds per million Btu by converting the nitrogen oxides into potassium nitrate fertiliz er, which could be sold for profit.

Response:

EPA notes that a BART determination is an emi ssion limit, not a requirement to install a specific technology. The facility must comply with the emi ssion limit within the required timeframe, and the operator of NGS may consider this, or any other t echnology, in developing its plan to cost-effectively comply with its NO x emission limit.

Comment: Environmental and Social Justice

Several commenters believe that the presence of NGS and several other power plants in and around the Navajo Nation represents an environmen tal and economic justice issue. Many noted that Navajo and Hopi communities were promised running water and electr icity at the time the plant was constructed 40 years ago; however, these communities, which live closest to the plant and are the most susceptible to the pollutants emitted by the plan t, still do not have access to running water and electricity. One commenter stated th at he had to pay $6,000 in order to receive electricity in his home, while other families in the area enjoy free power. Some commenters argued th at the Navajo Nation carries border towns on their backs by providi ng them energy and supporting their economy, and stressed that these residents living in areas categorized as de sert should pay the true cost associated with receiving power and water. One commenter explained that a Navajo water hauler pays 10 to 20 times more for water than recipients in southern Ariz ona. The commenter added that Kaibeto, a Navajo community near Page, pays $13,034.04 per acre foot of water; meanwhile, Glendale residents and a farmer in Tempe can expect to pay $551 and $41 per acre feet, respectively. One commenter countered that a power line project is curren tly underway and will provide power to nearly 62 homes in the area, so the communities lacking electr icity and running water will receive these commodities soon.

22 See pages 60 to 61 of the TSD for the Proposed Rulemaking, document number 0014 in the docket for this rulemaking at

EPA-R09-OAR-2013-0009.Page 14

EPA Responses to Comments: Navajo Gene rating Station Final Rule | July 28, 2014 Some of these commenters expressed their frus trations that owners of NGS and the Kayenta Mine have reaped large profits (m any investors recovering their capita l costs by 2027), while reservation residents still live in poverty. One commenter noted that the CEO of APS made $11.5 million in 2012; likewise the CEO of Peabody made $10.2 m illion and received a bonus of $2.6 million.

Several commenters expressed frustration with the leaders of the Navajo Nation and EPA, who they believe have not protected th e interests of the local population. A few expressed their concerns over

how the alternatives were writte n; noting that many tribal reside nts do not understand the technical language used in the documents and therefore cannot adequately comment on the validity of the alternatives proposed. Some commenters argued that pollution emitted is preventable using existing technology and EPA should enforce the same regulations on NGS as it does to other coal-burning power plants (e.g., FCPP) throughout the Un ited States. A few commenters ar gued that extending the time frame NGS has to comply demonstrates that the fe deral government believes it can be exempt from its own federal law. Several argued th at tribal communities do not have the funds to develop proposals

and/or conduct environmental assessments. The co mmenters stated that unlike industry, they cannot afford to hire university experts or engineers to speak on their beha lf and urged EPA uphold federal trust responsibilities and create an equal playing field.

Response:

EPA describes Environmental Justice as “the fa ir treatment and meaningful involvement of all people regardless of race, color, national origin, or income with respect to the development, implementation, and enforcement of environmental laws , regulations, and policies. EPA has this goal for all communities and persons across this Nation. It will be achieved when everyone enjoys the same degree of protection from environm ental and health hazards and e qual access to the decision-making process to have a healthy environment in which to live, learn, and work.” 23

EPA takes fair treatment and meaningful involvement seriously and provided numerous opportunities for tribal governments, environmen tal and tribal non-governmental organizations,

residents in Indian countr y and other interested stak eholders to provide input in the development of our proposed, supplemental and final rulemaking for NGS. EPA began our public i nvolvement process for a BART determination for NGS in 2009, when we published an Advanced Notice of Proposed Rulemaking (ANPR). In the ANPR, we presented our analyses of the cost and anticipated visibility

benefits of controls for FCPP a nd NGS and solicited public comment. 24 Although we initially provided a 30-day public comment period, at the request of trib al governments and other in terested stakeholders, we extended the comment period for tribes to Oc tober 28, 2009 and, to allow additional time for government-to-government consultation on NGS, exer cised our discretion to accept comments from tribes until March 1, 2010. As disc ussed in the TSD for our proposed rulemaking, EPA received over 6,000 comments on the ANPR. 25 During 2009 through 2012, EPA met with various stakeholders, including tribal governments and Navajo environmen tal groups, at their request, to discuss NGS and

hear their comments and concerns related to a BART determination for this facility. 26 On February 5, 2013, our Proposed Rule for NGS was published in the Federal Register. In the TSD for the Proposed Rule, we included discussion of the substantive commen ts we received that resulted in changes to the

23 http://www.epa.gov/environmentaljustice/

24 74 FR 44313 (August 28, 2009).

25 See page 25 of the TSD to the February 5, 2013 Proposed Rule.

26 See, for example document number 0232 in the ANPR docket at EPA-R09-OAR-2009-0598, and document numbers 0008

and 0009 in the docket for this rule at EPA-R09-OAR-2013-0009.Page 15

EPA Responses to Comments: Navajo Gene rating Station Final Rule | July 28, 2014 analysis we had presented in the ANPR. We initially provided a 90-day comment period for the proposed rule, and at the request of various stakeholders, we provided several extensions of the public comment period, which closed on January 6, 2014. Du ring the comment period, EPA continued to meet with stakeholders, at their reque st, to discuss our proposed BART determination for NGS and our

framework for better-than-BART alternatives. 27 Our docket for this final rule contains a record of each meeting we attended during this period.

On July 26, 2013, the Technical Work Group submitted the TWG Agreement to EPA for consideration. EPA posted the TWG Agreement to our docket on the same day to provide the public an opportunity to review it. 28 On September 25, 2013, EPA signed a S upplemental Proposal that, based on our review and analysis, proposed to approve requirements consiste nt with Appendix B of the TWG Agreement as “better than BART” (i .e., the TWG Alternative) and submitted it to the Federal Register for publication. EPA posted the pre-publication ve rsion of the Supplemental Proposal, along with supporting documents, to the docket on September 25, 2013 to allow for early review by interested parties. 29 Due to the lapse in appropriations and resu lting shutdown of the federal government from October 1 – 16, 2013, the Supplemental Proposal was pub lished in the Federal Register nearly one month after signature, on Octobe r 22, 2013. The comment period for th e Supplemental Proposal closed on January 6, 2014, the same day as the BART pr oposal. The Supplemental Proposal also included notice of five open house and public hearing events EPA scheduled throughout Arizona in November 2013. The open houses were held concurrently with th e public hearing (at one venue) or prior to the public hearing (at four venues), and allowed member s of the public an opportunity to talk with representatives from EPA and ask questions. EPA held events at the LeChee Chapter House, located on the Navajo Nation, as well as in Page, Arizona, a nd provided oral interpre tation services between English and Diné (the Navajo language). EPA also held an event at the Hopi Day School, located in Kykotsmovi, the seat of the Hopi tribal government . EPA engaged with the government of the Hopi

Tribe to search for an oral inte rpreter between English and the Hopi language, but th e Hopi Tribe was unable to locate anyone to provide th ose services. Finally, we also held events in Phoenix and in Tucson, Arizona, to allow stakeholders in central and southern Arizona, re presenting CAP water interests and several tribes receiving CAP water, the opportunity to provide commen t and talk with representatives from EPA. Although EPA understands that the TSD, a nd to some extent, the Federal Register notices,

include technical information that may be difficult for many individuals to understand, EPA did include Fact Sheets and handouts, written in plain language, with the Proposed Rule and Supplemental Proposal, and at the open house and public hearing events. 30 EPA representatives were also present at the events to discuss and explain our Proposals. EPA recognizes that many tribal communities do not have the funds to develop alternative proposals or hire experts on their behalf; however, we note that EPA considers with equal weight all comments, regardless of the form of the comment or whether the commenter is a purported expert or not.

As stated in our Proposed Ru le and Supplemental Proposal, EPA has determined that these proposed rules, if finalized, will not have disp roportionately high and adverse human health or environmental effects on minority or low-income populations because it in creases the level of environmental protection for all affected populations (i.e., requires emission reductions from NGS). 31
EPA recognizes that some comment ers may view the timeframe for compliance under EPA’s framework

27 See, for example, document number 0150, 0152, 0166, 0173, 0302, and 0303 in the docket for this rule at EPA-R09-OAR2013-0009.

28 See document number 0122 in docket for this rulemaking at EPA-R09-OAR-2013-0009.

29 See document numbers 0182, 0183, and 0184 in the docket for this rulemaking at EPA-R09-OAR-2013-0009.

30 See document 0219 in the docket for this rulemaking at EPA-R09-OAR-2013-0009.

31 See discussions under Executive Order 12898 in 78 FR at 8793 (February 5, 2013) and 78 FR at 62520 (October 22, 2013).Page 16

EPA Responses to Comments: Navajo Gene rating Station Final Rule | July 28, 2014 for BART Alternatives as an environmental justice issue. We note that the LNB/SOFA credit was based on real, actual emission reductions achieved beginni ng in 2009 at NGS that were voluntary and not required by any rule or regulation. This LNB/SOFA credit is an impor tant part of the framework for evaluating the compliance timeframe for BART Alternatives. However, we note that the TWG Alternative, which calls for closur e of one unit by the end of 2019 (or e quivalent curtailment) will result not only in reductions of NO x , but also reductions of severa l other pollutants, including SO 2 , PM, CO 2 , and hazardous air pollutants. Thus, although the TWG Alternative provides an al ternative timeframe for compliance at NGS to 2030, ultimately the TW G Alternative will re sult in greater NO x reductions than would have been achieved under BART, will result in reductions of additional pollutants that affect visibility or human health, and will provide an enforceable mechanism to ensure that NGS ceases conventional coal-fired electricity generation at NGS by the end of 2044. Finally, while we recognize the individuals and tribal non-govern mental organizations may have di fferent perspectives from the elected tribal officials or governments, EPA’s determ ination that compliance flexibility is necessary or appropriate for NGS was based, in part, on significant comments we re ceived from tribal governments about the direct importance of NGS on revenues to th e Navajo Nation and Hopi Tribe, and the indirect relationship between NGS, CAP, and tribes that receive CAP water through water settlement

agreements.

EPA recognizes that numerous co mmenters expressed frustration regarding social inequities

related to costs and benef its of coal mining and combustion and wate r availability and cost. We note that NGS and Kayenta Mine are undergoing a process to re new various leases and rights-of-way, and that these approvals are federal actions that are subj ect to NEPA. The joint EIS process for NGS and Kayenta Mine is the appropriate venu e to raise more general concerns re lated to costs, benefits, and the environmental and social justice of coal mining a nd coal combustion at the Kayenta Mine and NGS.



### 2.2 Mass Comment Campaigns

We received many comments from private indi viduals through email campaigns organized by several different environmental interest groups. Most of these commenters submitted the templates provided by the sponsoring organiza tions without change, but others customized the templates to varying degree.

Comments:

Comment 0120 includes over 36,000 nearly identical comments that were submitted via a Sierra Club campaign. Comment 0436 includes 416 additional emails submitted via the Sierra Club campaign

with individual variations. Most of these commen ts, including one private individual (0114) whose comment was posted as an individual comment to the doc ket incorporated some or all of the same points as Comment 0120, with some discussing the harmful ef fects of coal production on the environment, in particular the deterioration of air quality and visib ility at national parks and wilderness areas, including Grand Canyon, due to haze.Page 17

EPA Responses to Comments: Navajo Gene rating Station Final Rule | July 28, 2014 Comments 0121 and 0375 represent a mass ema il campaign sponsored by Care2, which was

identical to comment number 0120 and submitte d by over 7,000 individuals. Most comments incorporated some or all of the same point s as Comment 0120, although so me comments included personal observations. Similarly, Comment 0198 represents an example of 11 form letters submitted in a campaign sponsored by an unknown organizatio n; these letters were identical to C omment 0120, although some included personali zed hand-written additions.

Comment 0120 reads as follows:

Dear Region 9,

I am concerned about the coal plant po llution that has harmed views at Grand Canyon National Park for decades. Navajo Generating Station (NGS) is one of the dirtiest coal plants in the country and has fouled the world-renowned Grand Canyon for too long. Located just 12 miles from the park, it also pollutes at least ten other special places, including othe r national parks and wilderness areas. Worse, the federal government owns the largest share of NGS. We can't delay ending the coal pollution that is ha rming the Grand Canyon, and the federal government should lead in protecting the park.

I applaud your proposal to significantl y reduce nitrogen oxide pollution from NGS with strong pollution cont rols (Selective Catalytic Reduction or SCR), but I am deeply worried because you are cons idering delaying cleanup by ten years or more. Other coal plants harming special places have had to clean up within five years and there's no reas on it shouldn't happen at NGS, too. EPA proposed pollution controls for NGS that are the modern industry standard for NO x control. In fact, SCR is in use on more than 200 coal-fired units around the country.

Please require Navajo Generating Stati on to reduce haze pollution through the installation of SCR within five years to protect Grand Canyon and other parks affected by NGS's coal pollution. We owe it to future generations to pass on a restored natural heritage. Thank you for considering my comments.

Comment 0294 represents an example of 82 post cards that the EPA received from the Black Mesa Water Coalition. The postcard reads as follows:

The proposed BART ruling will not only reduce regional haze in the Grand Canyon, but also improve air quality fo r many people living around NGS. Enforce BART to protect th e public’s health.

Comment 0374 represents a mass email campai gn sponsored by Environment Arizona, which was submitted by 728 commenters. Most comments incorporated some or all of the same points; however, 17 comments were considered unique and were placed in Comment 0435. Most of these

commenters discussed the harmful effects of coal production on the environment, in particular the deterioration of visibility at the Grand Canyon due to haze.

The comment reads as follows:

Dear Ms. Lee,Page 18

EPA Responses to Comments: Navajo Gene rating Station Final Rule | July 28, 2014 I urge you to clean up the air at the Grand Canyon. Arizona is the Grand Canyon State. People come from across the globe to visit this amazing pl ace, and it's right here in our backyard. It has been almost 40 years now that the Navajo Generating Station coal plant has been polluting the vistas that are the pride of our state. We can't let this continue to happen.

Please make sure there is an enforceable and complete plan for this aging coal plant to clean up its air pollution as re quired under the Clean Air Act without delay.

Comment 0376 represents a mass email campai gn sponsored by WildEarth Guardians, which was submitted by 1,226 commenters, including 6 comment s that were considered unique. Comments 0058 and 0438 include 121 additional emails submitted through WildEarth Guardians, and two individuals (0059, 0068) whose comment were poste d as individual comments to the docket also submitted essentially the same comments. Most comments incorporated some or all of the same points.

Other comments discussed the harmful effects of coal production on the human health and the environment, and argued the potential bene fits to alternative energy sources.

The comment reads as follows:

Dear Regional Administrator Blumenfeld,

I support cleaning up the Navajo Generati ng Station's air pollu tion, but I believe there's a more reasonable path forward th an requiring the owners of this power plant to spend millions just to make th is coal-fired power plant less polluting.

The Navajo Generating Station takes a tremendous toll on our clean air, our health, and on our well-being in the Ameri can West. The plant's air pollution must be curbed, but there are better alternatives.

I call on the U.S. Environmental Protect ion Agency to explore clean energy

alternatives that both curb coal use at the Navajo Ge nerating Station and clear the air that we depend on. To this end, I call on the EPA to require the Navajo Generating Station to re tire altogether by 2020.

By setting a retirement date for the Navajo Generating Station, we can be assured that the plant's air pollution will be eff ectively curbed and that cleaner energy sources, including rooftop solar and efficien cies, will be able to replace this dirty

energy.

I support the EPA's efforts to safeguard our iconic and irreplaceable landscapes, like the Grand Canyon, and to keep our ch ildren and our communities safe from air pollution. Retiring the Navajo Generating Station by 2020 ensures both that our clean air will be protected and th at clean energy will power our future.

Comment 0377 represents a mass email campaign with the subject line re ading “Taxpayer from AZ,” which was submitted by 26 commenters, including 2 comments considered unique, and an additional 11 private individuals (0279, 0286, 0291,0309, 0311, 0319, 0322, 0378, 0379, 0422, 0423)Page 19

EPA Responses to Comments: Navajo Gene rating Station Final Rule | July 28, 2014 whose comment were posted separately to the docket. The majority of the comments submitted incorporated some or a ll of the same points.

An example comment reads as follows:

Dear Dr. Lee,

We, Thomas and Anita Christy have lived in Arizona since 1977. We are concerned about the EPA’s proposed rule re garding regional air vi sibility in areas surrounding the Navajo Generating St ation in northern Arizona.

In February 2013, the EPA issued a propos ed rule aimed at limiting nitrogen oxide emissions at the plant. At an es timated cost of up to $1.1 billion, EPA's proposal to limit these emissions five y ears from now, with a possible extension to 2023, would place a tremendous financial burden on me and my family as well as on energy users in Arizona and water users that take Central Arizona Project (CAP) water. The owners of the plant ha ve made clear that the short timeframes in the proposed rule could result in plan t closure. Regardless of whether the plant closes or remains open, EPA's proposed rule could cause serious economic hardship in northern Arizona and will force unaffordable water and energy costs upon Arizona businesses and ratepayers.

Because the EPA's proposed rule is unwork able on several levels, CAP and other key stakeholders formed a Technica l Work Group (TWG) and developed a

reasonable alternative that w ould protect regional air quali ty and also the future of NGS. The future economic wellbeing of Ar izona, including the Navajo and Hopi people who depend on NGS for jobs and othe r income, is at stake. We urge the EPA to adopt the TWG BART Propos al as the final rule for NGS.

Comment 0380 represents a mass email campaign with the subject line reading “Do not delay Navajo Station Generation cleanup,” which was s ubmitted by 114 commenters, including 6 comments that were considered unique. The majority of th e comments, including 6 additional emails placed in Comment 0434, incorporated some or all of the same points; however, some co mments stated that NGS should not be given an extensi on and discussed the harmful ef fects of coal production on the environment and the health of the Navajo people, al ong with the potential benef its of alternative energy

sources.

The comment reads as follows:

Dear Environmental Protection Agency,

You are requiring coal-fired power plants across the country to greatly reduce their harmful nitrogen oxide air pollution w ithin five years. Navajo people and all residents of the Four Corners region need those safeguards as well, in the same

time frame.

The communities and people of norther n Arizona and the Four Corners area

cannot continue to endure the harmful eff ects of coal pollution. Our health should be just as important as those from othe r parts of the country. Please do not allow delays or extensions for th e Navajo Generating Station.Page 20

EPA Responses to Comments: Navajo Gene rating Station Final Rule | July 28, 2014 This plant should not get special polluting extensions because it is on tribal lands. I am Navajo and I do not want con tinued pollution. I do not want a coal dependent economy. Today we have ways to generate power cleanly and inexpensively from the sun and wind, and there is demand for it across the Southwest. The solar and wind industry can generate the same amount of jobs as

coal.

The longer you allow the Navajo Generati ng Station to keep polluting, the more you hold communities back from where we want to go — toward clean air and clean energy. Please stick to your original proposal for Navajo Generating Station: nitrogen oxide pollution mu st be cut within five years.

Comment 0385 represents a mass comment lett er campaign organized by the National Parks Conservation Association, which was submitted e ssentially verbatim by 35,293 commenters. Comment 0439 includes roughly 296 additiona l letters organized by the same organization. Two hundred and eighty-seven of the original 35,293 comments and one additional individual (0067) whose comment was posted as an individual comment to the docket were considered unique. The majority of the comments incorporated some or all of the same points; however some commen ts included personal experiences with worsening air pollution in the region and discussed the negative imp acts associated with coal-fired power production.

The comment reads as follows:

Dear Jared Blumenfeld,

I'm writing as someone who believes that our national parks de serve clean air and knows that the law requires it. I'm concer ned about the Navajo Generating Station (NGS)--it's one of the dirtiest coal-fired power plants in the nation, and it's just 12 miles from Grand Canyon National Park! Th is antiquated polluter degrades air quality in the Grand Canyon and at least ten other beautiful national parks and wilderness areas in the region.

I applaud your proposal to significantl y reduce nitrogen oxide pollution from NGS with Selective Catalytic Reduction (SCR) but you are considering delaying cleanup by a decade or more. This plant's clean up should not be postponed; it should reduce its pollution within five years, just like ot her dirty old coal plants. The U.S. government is the plant's bigge st owner and accordingly its cleanup plan should set an example; rather than dela y reducing pollution that harms both lands and people. I urge you to require pollution controls within five years to protect Grand Canyon and other parks affected by NGS's pollution in a timely manner.

The Grand Canyon alone creates nearly 7,000 di rect and indirect jobs and brings over $428 million to the economy ever y year. Grand Canyon and the other national parks and wilderness areas in th e region are major economic generators for local economies. These are places that people worldwide come to experience-- places we, our children, and grandchild ren deserve to experience unimpaired. Please require Navajo Generating Station to reduce emissions through the use of SCR within five years.Page 21

EPA Responses to Comments: Navajo Gene rating Station Final Rule | July 28, 2014 Comment 0386 represents a mass email campai gn sponsored by Sierra Club that was submitted by 38,368 commenters. This mass email campaign include d two different letters. The first letter was submitted by 37,485 commenters. Most of these comments incorporated some or all of the same points. The second letter was submitted by 594 commenters and was essentially verbatim to Comment 0120. Out of the 38,368 comments, 284 were considered unique and included personal observations.

The first comment reads as follows:

Dear Ms. Lee,

I am concerned about the coal plant polluti on that has harmed the health of people who live near Navajo Generating Station (NGS) and that has obscured the skies over Grand Canyon National Park, other park s, and wilderness ar eas for decades.

NGS is one of the dirtiest coal plants in the country and has fouled worldrenowned Grand Canyon for too long. Located just 12 miles from the park, it also pollutes at least ten othe r special places, including other national parks and wilderness areas. Ironically, the federal government owns the largest share of

NGS.

While this docket is focused on regional haze, it is clear that cleaning up NGS will provide significant public health bene fits, especially to those nearest the plant, whose voices have been ignored far too often. The Clean Air Task Force estimates that pollution from NGS contri buted to 16 premature deaths, 25 heart attacks, 300 asthma attacks, and 15 asthma emergency room visits last year. This

results in total annual health costs of more than $127 million. When the costs are evaluated, the health costs and cost in lives should be considered.

I support EPA's proposal to significa ntly reduce nitrogen oxide (NO x ) pollution from NGS with strong pollution controls (Selective Catalytic Reduction or SCR), but I am deeply worried because EPA is considering delaying cleanup by ten years or more. Other coal plants harmi ng special places and public health have had to clean up within five years; NGS should as well. The EPA-proposed pollution controls for NGS are the modern industry standard for NO x control, and, in fact, SCR is in use on more than 200 coal-fired units around the country, including on other coal plants in Arizona.

I cannot support the proposed Technical Work Group proposal that is being promoted by Salt River Project because it lacks a clear enforc eable path to end coal's dirty legacy in the region and br ing about development of renewable energy to tribal lands. The plant operators must comply with EPA's proposed rule or opt

for a combination of retirement and retrof its that would meet the same reductions. The current TWG proposal does not do that . It does not meet the emissions reduction requirements in a timely manner and also includes huge question marks and several off-ramps, meaning no clear path. There is no guarantee that a unit will close. There is no commitment to stop burning coal.

Arizonans and others in th e region have waited far too long for clean air and clear skies over Grand Canyon. Our health has su ffered for long enough. It is past timePage 22

EPA Responses to Comments: Navajo Gene rating Station Final Rule | July 28, 2014 for the plant operators to st ep up and agree to a clear and enforceable plan that includes the reductions in pollutants that meet the Clean Air Act requirements.

The Clean Air Act's visibility protecti on provisions, enacted with strong bipartisan support, contain clear requirem ents that must be met to restore and protect air quality in our national park s and wilderness areas. Most important among these is the requirement to instal l modern pollution controls on outdated major pollution sources, such as coal-f ired power plants, that demonstrably degrade air quality in Class I areas. It is uncontested that NGS lacks such modern pollution control equipment and that its emissions degrade ai r quality at many Class I areas in the region.

We can't delay ending the coal pollution that is harming Grand Canyon, and the federal government should lead in prot ecting the park. Please require Navajo Generating Station to reduce haze pollution through the installation of SCR within five years to protect Grand Canyon and other parks affected by NGS's coal pollution. We owe it to future generations to pass on a restored natural heritage.

Comment 0424 represents an example of 51 post cards that the EPA received from the Navajo Nation. The postcard reads as follows:

EPA’s proposal to cut nitrogen oxide po llution at NGS by 84% within five years will reduce Grand Canyon haze and improve air quality for nearby residents.

Response:

EPA agrees with commenters that NGS affect s visibility at numerous national parks and wilderness areas throughout the Southwest and we agree that an emission limit representing the installation and opera tion of SCR is BART for NGS. As disc ussed in more detail in Section 3.0, EPA disagrees with commenters that our proposed BART determination will cost over $1.1 billion. EPA also disagrees that NGS lacks modern pollution control e quipment. As discussed in our Proposed Rule, NGS uses hot-side electrostatic precipitators to co ntrol PM and wet limestone FGDs to control SO 2 . In addition, over 2009-2011, NGS installed mode rn combustion controls to reduce NO x by approximately 30 percent. Regarding comments on public health, EPA notes that ma ny of the same pollutants that impair visibility are criteria pollu tants that are regulated by different programs under the CAA for their

effects on human health.

EPA recognizes the many commenters support a fi ve-year compliance timeframe for installation of SCR, and many other commenters supported the flexibility in the tim eframe for compliance afforded under the TWG Alternative. EPA provides further discussion of the TW G Alternative and the compliance timeframes in Sections 8 and 9 of this response to comments document. While many commenters expressed a desire for EP A to encourage a transition to re newable energy technologies such as wind and solar power, the ability to require such a transition is beyond the scope of this rulemaking. As described in a previous respons e, EPA does not consider BART as a requirement to redesign a source when considering availabl e control alternatives (s ee specifically 70 FR 39164). 32

32 See “Regional Haze Regulations and Guidel ines for Best Available Retrofit Techno logy (BART) Determinations”, 70 FR 39104, July 6, 2005, in the docket for this rulemakingPage 23

EPA Responses to Comments: Navajo Gene rating Station Final Rule | July 28, 2014 

## 3.0 Comments on Factor One – Cost of Controls

3.1 Comments on the Analysis of the Cost of SCR at NGS

Comment: General

Sixteen private individuals (0079, 0117, 0145, 0146, 0147, 0148, 0161, 0163, 0167, 0168, 0193, 0200, 0203, 0205, 0212, 0226), government commenters (0287, 0297, 0324, 0406, 0443), a public/private coalition (0400), and an industry trade association ( 0278) argued that installing SCR could cost NGS over $1 billion without yiel ding any perceptible visibility improvements. 33 One of these commenters (0079) emphasized that this system would be 15-20 tim es more expensive than the LNB/SOFA already installe d, and warned that these costs may result in a 20 percent increase in CAP energy rates, or higher if the pl ant cannot finance the cost of th is equipment over a 20-year period.

Another private individual (0020) strongly urged EPA not to dela y the installation of controls

because the cost to install them will only increase in the future. Sim ilarly, one private individual (0180) considers the high cost of SCR technology as a good incentive for coal-power companies to pursue alternative energy sources.

Response:

EPA disagrees with the asserti on that installing SCR would cost NGS over $1 billion. In Table 2 of our proposed rulemaking (78 FR at 8280), we provided the total capital cost for SCR plus LNB/SOFA estimated by SRP, the facility operator ($589 million), and the cost estimated by EPA ($541 million). The assertion of $1 billion dollars in cost for SCR is associated with the presumption by commenters that future permits or rules would require the installa tion and operation of baghouses at NGS. The response to that comment is provi ded later in this section (section 3.1).

EPA disagrees with the assertion that there wi ll be no perceptible visibility improvement from our proposed BART determination. The response to this comment is addressed in section 7.0. EPA agrees that SCR is more costly than LNB/SOFA . Using the estimates from our proposed rulemaking, SCR+LNB/SOFA is more costly than LNB/SOFA alone by approximate 12 times ($541 million versus $45 million). However, EPA disagrees that the costs asso ciated with SCR would result in a 20 percent or greater increase in CAP energy rates. As discusse d in Table 8 of our Proposed Rule, we project an increase of $8.40 per acre-foot of water, representing a 14 percent increase of the energy-only water rate (paid by tribes or Non-Indian Agri culture (NIA) water users), or a 6 percent increase over the energy and fixed OM&R costs paid by other CAP water us ers (e.g., municipal and co mmercial water users).

EPA agrees that costs to install controls may incr ease in the future (due to other factors, such as inflation), however, EPA disagrees th at this is a reason to require inst allation of controls at NGS sooner than is practicable. EPA disagrees with the asserti on that SCR is a “high cost” technology (we note that SCR is an industry standard for new coal and natu ral gas fired power plants). We disagree that SCR should serve as an incentive to pursue other en ergy sources (see e.g., secti on 4.1.2); we note that the purpose of the BART requirement under the provisions of 169A of the CAA is to protect visibility by

33 Throughout this document, four digit numbers in parentheses represent the last four digits of the document ID number inthe docket for this rule, e.g., 0079 refers to document number 0079 in EPA-R09-OAR-2013-0009, also referred to as EPAR09-OAR-2013-0009-0079. See also Appendix A for list of commenters by document ID number.Page 24

EPA Responses to Comments: Navajo Gene rating Station Final Rule | July 28, 2014 requiring stationary sources of a certa in size and age to install the “best available retrofit technology” to reduce emissions of visibility-impai ring pollutants. This requirement doe s not require fuel-switching, or a redefinition of the source, nor is it intended to incentivize alternative energy sources.

Comment: EPA underestimated SCR costs

Two of the owners of NGS (0314, 0348), a state agency (0017/0289/0320), and a CAP agricultural water users group (0305 ) commented that EPA underestimated the cost of compliance by disregarding real costs th at would be incurred. One of the NGS ow ners (0348) noted that in the February 2013 Proposal, EPA largely accepted the cost estimat es developed for SRP by S&L in 2010; however,

EPA revised or removed several of the line items within S&L’s cost estimates for installation of SCR at NGS, including interest rates, Owner’s Constr uction Management, O&M Support & Contracted Services, Owner’s Legal Support an d Insurance, and Allowance for Funds Used During Construction (AFUDC). The commenter disagreed with several of EPA’s revisions to S&L’s work, commenting as

follows:

 On the basis that they are not included in th e Control Cost Manual, EPA eliminated Owner’s Construction Management, and O&M Support & C ontracted Services, despite the fact that these line items represent real costs incurred throughout the project by NGS Participants, such as project initiation, project management, owner’s onsite construction support and startup activities. The commenter disagreed that they are not included in the Control Cost Manual, stating that these items typically would be included in the “Construction Management and Field Engineering” line item in the S&L estimate – a line item that EPA accepted into the estimate. These items have been broken out into a separate line item due to the commenter’s preferred approach to perf orming major capital equipment installation projects. The commenter has consistently empl oyed this approach throughout its fleet for a variety of installations, believing that this approach has resulted in improved design quality and overall equipment reliability versus current contracting trends (i.e., Engineer/Procure/Construct contracts). Accordin gly, the commenter has continued to include

this line item in its estimated installation costs for SCR at NGS.

 Even if AFUDC is excluded in the Control Co st Manual, it is a real cost to the NGS Participants, and it therefore should be included in an evaluation of the cost of controls, in

accordance with the BART Guidelines.

 The EPA revised the interest rates for calcula ting the annualized cost of capital from 9.8 percent down to 7 percent on the basis that th e Control Cost Manual recommends the use of 7 percent. The commenter objected to the use of a “one size fits all” approach for cost

calculations and asserted that the EPA should accept cost estimates that are based on the real cost of borrowing money for power plant owners.

The CAP agricultural water users group (0305) q uoted the BART Guidelines and the final RHR

to assert that while the use of the Control Cost Ma nual is encouraged, it is not mandated, and that EPA

has discretion to use additional sources of cost info rmation. The commenter believes, therefore, that the SRP estimates for the excluded cost items are appropria te to use because they are more precise than the generic statements that EPA relied upon in the Cont rol Cost Manual. The commenter asserted on this basis that because EPA has not provided specific reasons why the SRP estimates are inaccurate or unnecessary, it should use the SRP es timates rather than guidance in the Control Cost Manual.

Response:Page 25

EPA Responses to Comments: Navajo Gene rating Station Final Rule | July 28, 2014 EPA disagrees with the comment that we imprope rly reworked and underestimated the SCR cost estimates; however we note that even if we only re lied on the cost estimate pr ovided by SRP, EPA still

would have concluded that SCR is cost-effective at NGS. EPA used a hybrid approach for our cost analysis that relied primarily on the cost estima tes provided by SRP, but also followed the BART Guidelines, that state “[i]n order to maintain and improve consistency, cost estimates should be based on the OAQPS Control Cost Manual, where possible” to determine whether SRP in cluded cost estimates for services or equipment associ ated with SCR that were not a llowed under the EPA Control Cost Manual (e.g., owner’s costs or allowance for funds used dur ing construction, or AFUDC). 34 We note that the capital cost es timate EPA presented in the proposed rulemaking for SCR plus LNB/SOFA ($541 million total for Units 1-3) is only 8 percent lower than the SRP cost estimate ($589 million) and that
even if we had used SRP’s cost estimate, it woul d not have changed our determination under Factor 1

that SCR is cost-effective at NGS.

Our detailed, line-by-line analysis was included in the docket for this proposed rulemaking and provided an explanation for why we retained, modified, or rejected each line item in the SCR cost

estimate for Units 1-3 at NGS. 35 EPA used all of the di rect capital costs as estimated by S&L. Direct capital costs are those costs that co ntribute directly to the physical capit al of the installation (e.g., steel, concrete, mechanical equipment, etc). Indirect capita l costs are associated with installation, for example, construction and contractor fees, st artup, testing, and process continge ncy costs. The EPA Control Cost

Manual calculates total indirect costs as a percentage of the total direct capital costs, and estimates that general facilities would be 5 percent of total direct capital costs, engineering and home office fees would be 10 percent of total direct capita l costs, and process contingency w ould be 5 percent of total direct capital costs. Thus, the EPA Control Cost Manual calcula tes total indirect costs to be 20 percent of total direct capital costs.

As discussed in the TSD to the proposed rulema king, EPA made four adjustments to SRP’s cost estimates for SCR: two adjustments to total indirect capital costs, one adjustment to an additional capital cost, and one adjustment to the annual cost calculation. 36 For example, using Unit 2 as an example, EPA excluded indirect capital costs of $8,163,050 that S&L attributed to “Owners Construction Management, O&M Support, Contract Services,” and a cost of $5,000,000 attributed to “ Owners Legal Support and Insurance.” EPA also excluded a cost of $4,059,526 at tributed to “Allowance for Funds Used During Construction” which is an additional component of tota l capital cost, and revised the interest rate from 9.8 percent to 7 percent, which is used in the calculation of total annual cost.

S&L estimated total indirect capital cost to be $49.7 million. EPA estimated indirect capital costs to be $36.5 million. We note that, had we used the calcu lation methodology exactly as prescribed in the EPA Control Cost Manual, the tota l indirect capital cost would ha ve been roughly $18 million (based on 20 percent of S&L’s estimate of tota l direct costs, which are already escalated compared to total direct costs using the EPA Control Cost Manual). The indirect capital cost S&L estimated is roughly 2.8 times higher, and the indirect capital co st estimated by EPA is roughly two times higher, than that estimated using the EPA Control Cost methodology. EPA notes th at S&L did not provide information to identify and differentiate between costs included under “Engin eering, Procurement, and Project Services” valued at $14 million, “Construction Management/Field Engi neering” valued at $15 million, and “Owners Construction Management, O&M suppor t and Contract Services”, valued at $8 million (these values

34 The OAQPS Control Cost Manual is now referred to as the EPA Control Cost Manual.

35 See MS Excel document titled “EPA cost analysis for NGS” in the docket for this rulemaking at EPA-R09-OAR-2013-

0009-0004.

36 See Table 12 of the TSD to the February 5, 2013 Proposed Rulemaking at EPA-R09-OAR-2013-0009-0014.Page 26

EPA Responses to Comments: Navajo Gene rating Station Final Rule | July 28, 2014 represent cost estimates for Unit 2). In particular, S& L did not provide sufficient detail to determine that these line-item costs do not repr esent redundant costs. EPA exclude d the line item representing the $8 million cost for “Owners Construction Management, O&M Support and Contract Services” as costs not

included in the EPA Control Cost Manual. Althou gh “contractor fees” are costs cited by the EPA Control Cost Manual as an appropriate indirect cost , these fees seem to be represented under existing line items costs, e.g., “project services” or “cons truction management/field engineering”. EPA also excluded legal support and insurance, a $5 million cost, as costs that are not included in the EPA Control Cost Manual (legal support) or that are noted as being minimal (insurance). 37 EPA similarly excluded the additional capital cost for AFUDC, as the EPA Control Cost Manual specifically sets this value to

zero. 38 As asserted by commenters, alt hough these costs (e.g., AF UDC or legal costs), may be real costs that could be borne by a utility, EPA notes that ex clusion of these three line item costs, totaling $17 million for Unit 2, resulted in an 8% difference in the total capital cost for Unit 2. This difference would not have changed our determination under F actor 1 that SCR is cost-effective for NGS.

For calculating total annual cost, EPA used the values estimated by S&L for all line items, except for capital recovery (i.e., the interest rate). S&L used a capital recove ry factor based on a 9.8 percent interest rate and 20 year life (or recovery period), whereas EPA used a capital recovery factor based on a 7 percent interest rate and a 20 year life. Based on the difference in capital recovery, S&L

estimated total annual cost for Un it 2 to be roughly $27.8 million and EPA estimated total annual cost for Unit 2 to be $21.8 million – a difference of $6 m illion, or 22 percent. As explained in Chapter 2 (Cost Estimation: Concepts and Methodology), and as discussed in EPA’s line-by- line cost estimate that accompanied our proposed rule, 39 the EPA Control Cost Manual us es a social interest rate, as determined by the Office of Management and Budget (OMB), which the EPA Control Cost Manual (in 2002) cites as 7 percent. 40 OMB states, in their Circular relate d to Regulatory Analysis, that: “As a default position, OMB Circular A-94 st ates that a real discount rate of 7 percent should be used as a base-case for regulatory analysis. The 7 percent rate is an estimate of the average before-tax rate of return to private capital in the U.S. economy.” 41 Therefore, EPA’s use of a 7 percent interest rate is conservative and generally consistent with ot her cost analyses performed for other BART determinations nationally. 42

In our Proposed Rule, we presented total capital and total annual cost estimates from EPA and SRP, as well as average and incremental cost-eff ectiveness values based on EPA and SRP assumptions

for total annual cost and total annual NO x reductions. Based on SRP’s analysis, average costeffectiveness of SCR+LNB/SOFA at NGS was less than $3,000 per ton and incremental costeffectiveness of SCR+LNB/SOFA (compared to SNCR+LNB/SOFA) was approximately $5,300 per

ton. 43 EPA stated that the cost-effectiveness values calculated by both EPA and SRP for

37 See page 2-48, discussion of indirect annual cost, of the EPA Control Cost Manual Section 4 – NOx Controls.

38 Elsewhere, EPA discusses exclusion of AFUDC based on the “overnight” costing methodology used by the EPA Control Cost Manual. See e.g., Final Regional Haze Rule for Arizona (Phase 1) at 77 FR 72512 at 72531 (December 5, 2012) and

footnote 94 and re ferences therein.

39 See MS Excel document titled “EPA cost analysis for NGS” in the docket for this rulemaking at EPA-R09-OAR-2013- 0009-0004, and EPA Control Cost Manual availabl e at: http://www.epa.gov/ttncatc1/dir1/c_allchs.pdf

40 See page 2-13 of Chapter 2 of the EPA Control Cost Manua l, available at: http://www.epa.gov/ttncatc1/dir1/c_allchs.pdf.

41 http://www.whitehouse.gov/o mb/circulars_a004_a-4/#e

42 See, e.g., Final Regional Haze Rule for Arizona (Phase 1) at 77 FR 72512 at 72547 (December 5, 2012) and Final Regional Haze Rule for Wyoming at 79 FR 5032 at 5137 (January 30, 2014). We note however, that there are other BART determinations that have used lower interest rates, e.g., Final Regional Haze Rule for Oklahoma at 76 FR 81728 at 81745 (December 28, 2011).

43 See Table 3 of our Notice of Proposed Rulemaking, 78 FR at 8281 (February 5, 2013).Page 27

EPA Responses to Comments: Navajo Gene rating Station Final Rule | July 28, 2014 SCR+LNB/SOFA are lower than or within the range of other BART evaluations that required SCR; and

EPA has determined that SCR is cost-effective at NGS. 44 Therefore, even if EPA accepted the S&L cost estimates submitted by SRP, as commenters suggest, EP A would still have determined that SCR is costeffective for NGS.

Comment: EPA overestimated SCR costs

An environmental advocacy group (0373) stated th at EPA overestimated the cost of installing SCR at NGS. In contrast to the pr evious comment, the commenter indi cated that EPA properly adjusted the cost estimates submitted by one of the owners of NGS as improper or not allowed under accepted methodologies, including using a lower interest rate and excluding the costs of other pollutant control technology. However, the commenter believes that further revisi ons are appropriate.

The commenter (0373) (citing the Stamper report submitted with the comments) stated that EPA overestimated the cost of SCR at NGS in the following ways:

 Overestimated outage costs associated with inst allation and “preinstallation” work that is unsupported, often inflated, and should have been excluded under the same rationale that the EPA excluded cost of other pol lutant control technologies.

 Overestimated catalyst costs that are almost twic e the low end of the range that vendors have typically quoted. Accepting this high catalyst cost is inconsistent with BART determinations elsewhere; for example, in its analysis of BART for NO x control at Colstrip Units 1 and 2 in Montana, the EPA relied on a 2010 study show ing catalyst prices as low as $4,000/m 3 with average prices at $5,000-6,000/m 3 , not the $8,000/m 3 claimed by the NGS owner.

 Improper statement of the cost of auxiliary pow er; the NGS owner relied on market rates which are in excess of the busbar cost (i.e., cost to the owner to generate electricity).

 Assumed lifetime of an SCR system for NGS should be at least 30, not 20 years. Even a 30-year lifetime is itself very conservative as many SCRs installed in Europe in the 1980s are still in operation today, and an analysis prepared by Black & Veatch for another facility assumed a 40- year lifetime for SCR. The lifetime of an SCR retrofit is generally set equal to the remaining

useful life of the facil ity – in this case 2044. There is no s upport in the record for a 20-year lifetime and the cost assumptions associated with it.

 Corrected interest rate is still too high. EPA used 7 percent, noting that it is the “social” interest rate, which is proper for analyzing BART. Ho wever, the Office of Management and Budget (OMB) has recently published a social interest rate of 2.8 percent for a 20-year amortization period, and the Control Cost Manual directs usin g the social interest rate set by OMB. In addition, it is uncertain that the social interest rate should be used in a BART determination

because cost-effectiveness determinations for BART do not appear to fall within the scope of “cost analyses related to governme nt regulations.” Rather, a source- specific rate of interest (i.e., the rate at which NGS can borrow) may be the co rrect rate to use, whic h appears to properly fall within a range of 2.9 percent (the cost of capital for SRP) and 4.9 pe rcent (the cost of capital for Arizona Public Service).

44 See our Notice of Proposed Rulemaking at 78 FR at 8281 (February 5, 2013).Page 28

EPA Responses to Comments: Navajo Gene rating Station Final Rule | July 28, 2014 By correcting what the commenter (0373) believ es are overestimated costs and underestimated SCR performance (see section 8.1), the commenter calculated that SCR is more cost effective than estimated by EPA. In these calculations, the commenter assumed 80 to 84 percent NO x pollutant

removal at each of the three NGS units with the inst allation of SCR and adjusted costs to (according to the commenter): (1) make the method used consiste nt with the overnight costing methodology in the Control Cost Manual; (2) account for a more accurate cat alyst cost; (3) move auxiliary power costs into operations and maintenance and use a more accurate cost per unit of electricity; (4) adjust the cost of reagent such that it is not inflat ed; (5) use a proper, lower interest rate of 4.9 percent (the most conservative rate that is correct); and (6) adjust the lifet ime of the SCR controls to reflect 30, not 20 years. While the commenter believes that EPA pr operly found that SCR plus LNB/SOFA is costeffective at NGS at $2,240 per ton of NO

x removed (at an emission ra te of 0.055 lb/MMBtu), the

commenter asserted that its correct ed cost-effectiveness calculations result in values of $1,412 per ton for Unit 1, $1,331 per ton for Unit 2, and $1,497 per ton for Unit 3. On this basis, the commenter

contended that EPA’s determination that SCR plus LNB/SOFA is BART for NO x control at NGS is the correct, fully-supported and fully-supportable decision.

Response:

We agree that our BART determination for NO x is fully-supported by ou r five-factor analysis, however, EPA disagrees with the co mmenter that any further revisions to the SCR cost estimate are necessary. Even if some of the co sts projected by S&L and used by EP A may be overestimated (e.g., the commenter points primarily to capital recovery, cataly st replacement costs, and costs for lost power generation), EPA disagrees that we must correct every issue of concern raised by the commenters in order to support our BART determination. EPA made four specific corrections to the estimates provided by S&L and SRP to make the cost calculation me thodology more consistent with methodologies used for BART cost calculations nationally. 45 As noted in the response to comments that we underestimated the cost of SCR, EPA noted that even if we consid er the average and incremen tal cost effectiveness of SCR using SRP and S&L’s full cost projections, EPA would still determine that SCR at NGS is costeffective. The cost-effectiveness values cited by th e commenter, below $1,500 per ton, certainly suggest

that SCR could be even more cost-effective than the values we re lied upon in our proposal, but this would not change our overall determination that an emission limit achievable with SCR is BART for

NGS.

Comment: Updated SCR cost estimate from SRP

Because compliance with EPA’s proposed BART de termination is achievable with SCR, one of the owners of NGS (0348) contracted with S&L in 2013 to review and update the SCR cost estimates that were prepared in 2010 (repor t attached to comments as Appendix U). According to the commenter, in addition to escalating the SCR cost estimate to reflect inflation, S&L in corporated other minor adjustments to its 2010 estimate as a result of ch anges in equipment needs based on recent experience

with the SCR installation at SRP’s Coronado Genera ting Station and also made adjustments to ensure

that the lowest level of NO x emissions can be achieved based on de sign standards at this time, including modifications to the air baskets to address likely in creases in ammonium bisulf ate formation and sulfuric acid fouling and corrosion, deduction of economizer flue gas bypass, inst allation of soot blowers instead

45 See, e.g., Final Regional Haze Plan for Arizona (Phase 1) at 77 FR 72512 at 72531 (December 5, 2012); Final Regional

Haze Plan for North Dakota at 77 FR 20 894 at 20916-17 (Apr il 16, 2012); Final Regional Haze Plan for New Mexico at 76

FR 52388 at 52399-400 (August 22, 2011); Final Regiona l Haze Plan for Wyoming at 79 FR 5032 at 5082 (January 30, 2014).Page 29

EPA Responses to Comments: Navajo Gene rating Station Final Rule | July 28, 2014 of sonic horns for improved online maintenance of dust and ash loading on the upper layer of the SCR,

installation of a hot wate r recirculation system for greater relia bility due to flue gas temperature increases, and installation of an extra layer of catalyst. The revised capital cost estimates for SCR installation submitted by the commenter are shown in Table 1.

Table 1: Cost Estimates for SCR Provided by SRP in 2010 and 2013 Dollars

Item Unit 1 Unit 2 Unit 3
2010 Costs $151,825,000 $205,808,000 $186,528,000

2013 Costs $162,896,000 $220,928,000 $199,760,000 2013 Scope Adjustments $20,955,000 $24,533,000 $21,030,000

2013 Total Costs $183,851,000 $245,461,000 $220,790,000 Total Cost for all Units $650 million

Response:

EPA reviewed the updated 2013 cost estimat es developed by S&L and provided by SRP. 46 In its 2013 cost report, S&L explains that it generally escalated labor costs by 8 percent and material costs by 6.7 percent. In addition, S&L provi ded updated cost estimates based on a revised design target of 0.03 lb/MMBtu (so that the SCR system is deployed as a 3+ 1 system rather than a 2+ 2 catalyst layer system), and other design features, includi ng a low-load temperature control system to operate SCR at lower

loads. S&L escalated several cost s at rates above 6.7 or 8 percent (e.g., freight, scaffolding). S&L did not make any revisions to the components of vari able annual costs, includ ing maintenance labor, auxiliary power, steam, and catalyst replacement. To be consistent with the cost estimates in our proposed rulemaking, EPA accepted most of the line it em costs as adjusted by S&L and made the same four adjustments to the 2013 cost estimates, namely, to exclude “Owners Construction Management, O&M Support and Contract Service,” “Owners Lega l Support and Insurance,” and AFUDC, and to use an interest rate of 7 percent. These changes result in an 8 percent difference in total capital costs of SCR

between EPA’s 2013 estimate and SRP’s 2013 estimate and a 21 percent difference in the total annual

costs of SCR between the 2013 estimates from EPA and SRP (see Table 2).

46 See document titled “2014_0304 EPA cost analysis for NGS_Revised for 2013.xlsx” in the docket for this rulemaking.Page 30

EPA Responses to Comments: Navajo Gene rating Station Final Rule | July 28, 2014 Table 2: Cost Estimates for SCR in 2010 and 2013 Dollars

Unit 1 Unit 2 Unit 3 Total

Costs Estimated by

EPA Total Capital Cost in 2010 $ $137,527,000 $188,585,000 $170,294,000 $496 M

Total Capital Cost in 2013 $ $168,391,000 $226,811,000 $203,297,000 $598 M

Percent Change 21% 20% 19% 21%

Total Annual Cost in 2010 $ $16,963,576 $21,783,090 $20,056,549 $58.8 M

Total Annual Cost in 2013 $ $19,876,919 $26,165,354 $23,171,799 $69.2 M

Percent Change 17% 20% 16% 18%

Costs Estimated by

SRP Total Capital Cost in 2010 $ $151,825,000 $205,808,000 $186,528,000 $544 M

Total Capital Cost in 2013 $ $183,851,000 $245,461,000 $220,790,000 $650 M

Percent Change 21% 19% 18% 19%

Total Annual Cost in 2010 $ $21,579,000 $27,835,000 $25,601,000 $75.0 M

Total Annual Cost in 2013 $ $25,290,000 $33,205,000 $29,572,000 $88.1 M

Percent Change 17% 19% 16% 17%

In our proposed BART determination, EPA also presented the average and incremental costeffectiveness of controls, base d on the combination of combusti on controls (LNB/SOFA) and postcombustion controls (i.e., SNCR or SCR). Therefore, cost-effectiveness values presented in Table 3 of our proposed rule were based on total annual cost of SCR in combination with annual cost of LNB/SOFA (SCR+LNB/SOFA), SNCR in combina tion with LNB/SOFA (SNCR+LNB/SOFA) or

LNB/SOFA alone. 47 Based on the updated 2013 cost estimates for SCR, Table 3 shows the average and

incremental cost-effectiveness of controls, in both 2010 and 2013 dollars, based on EPA and SRP assumptions for total annual cost and annual NO x reductions achieved by the th ree sets of technologies. SRP only provided updated costs (in 2013 dollars) for SCR. Therefore, SCR based on 2013 cost

estimates and SNCR or LNB/SOFA ba sed on 2010 cost estimates may no t be directly comparable, but

we still include calculations of incremental cost-e ffectiveness because it provi des useful information,

and it is based on the set of cost values that SR P has chosen to provide on our proposed rulemaking.

47 78 FR at 8281, February 5, 2013Page 31

EPA Responses to Comments: Navajo Gene rating Station Final Rule | July 28, 2014 Table 3: Cost Effectiveness of Controls in 2010 and 2013 dollars 48
2010 $ 2013 $

EPA SRP EPA SRP

LNB/SOFA Total Annual Cost $5.2 million

SRP did not submit updated costs in 2013 $ Annual NO x reduced (tpy) 10,865

NO x Limit (lb/MMBtu) 0.24 Average Cost Effectiveness $486 per ton

SNCR+

LNB/SOFA Total Annual Cost $28.8 million

Annual NO x reduced (tpy) 16,608

NO x Limit (lb/MMBtu) 0.18 Average Cost Effectiveness* $1,745 per ton

Incremental Cost Effectiveness $4,110 per ton

SCR+

LNB/SOFA Total Annual Cost** $67.5 million $80.2 million $74.4 million $92.6 million

Annual NO x reduced (tpy) 28,573 26,180 28,573 26,180

NO x Limit (lb/MMBtu) 0.055 0.080 0.055 0.080
Average Cost Effectiveness $2,369 per ton $3,069 per ton $2,605 per ton $3,537 per ton

Incremental Cost Effectiveness (vs. LNB/SOFA) $3,522 per ton $4,889 per ton $3,899 per ton $5,695 per ton

Incremental Cost Effectiveness (vs. SNCR+LNB/SOFA) $3,239 per ton $5,357 per ton $3,798 per ton $6,647 per ton

* In Table 3 of our Notice of Proposed Rulemaking (NPR-Table 3), EPA reported the following values for SRP’s average and incremental cost effectiveness of SNCR+LNB/SOFA: $1,481 per ton (average) and $3,135 per ton (incremental). EPA also reported SRP’s incremental cost eff ectiveness of SCR+LNB/SOFA to be $5,282 per ton. These values were based on reported values in SRP’s Updated NGS BART Analysis dated January 20, 2012. These values were based only on SCR at 0.08 or SNCR at 0.018 lb/MMBtu (not SCR or SNCR in combination with LNB/SOFA) and for SNCR, assume a smaller

annual NO x reduction (approximately 15,896 tons per year) than EPA had estimated (16,608 tons per year). For an “apples to apples” comparison in NPR-Table 3, EPA could have repo rted the same average and in cremental costs for SNCR to represent both EPA and SRP because EPA di d not make any revisions to SRP’s cost estimates for SNCR. For the incremental cost of SCR+LNB/SOFA comp ared to SNCR+LNB/SOFA and SCR+LNB/SOFA compared to LNB/SOFA, EPA could have used the above values of $5,357 per ton and $4,889 per ton, to represent SRP cost estimates. ** EPA’s cost effectiveness calculations represent SCR in combination with LNB/SOFA, rather than SCR alone.

Based on the revised 2013 cost estimates for SCR presented in Table 2 of this response to

comments document and the revised cost-effectiveness values presented in Table 3 of this document,

EPA continues to determine that SCR+LNB/SOFA is cost-effective at NGS. In addition, we note that the values for average cost-effectiveness of SCR at NGS are comparable to average cost-effectiveness

values for BART determinations elsewhere in th e western U.S. where SCR was determined BART, ranging from $825 per ton to $6,300 per ton. 49

Comment: Updated baghouse cost estimate from SRP

One of the owners of NGS (0348), a trib al government (0039/0317), and a state agency (0017/0289/0320) indicated that there is a possibility that baghouses will be needed to address the increased PM emissions from NGS if the propos ed BART determination is implemented. These commenters said that baghouses could increase the cost of compliance by over $500 million, and that

EPA must consider these costs in its analysis. One of the commenters (0039/0317) stated th at this would increase the cost of SCR by 108 percent, and another (0017/0289/0320) indicated that it would approximately double the elec tric and water rate im pacts identified by EPA.

48 See document titled “2014_0304 NGS emissions and incremental costs.xls” in the docket for this proposed rulemaking.

49 See document titled: “Western Coal EGU BART Summary.xlsx” in the docket for this rule.Page 32

EPA Responses to Comments: Navajo Gene rating Station Final Rule | July 28, 2014 One of the owners of NGS (0348) stated that in the TSD accompanying the February 2013 Proposal, EPA indicated that it cannot know if a baghous e fabric filter would be required as part of a

New Source Review Best Available Control Tec hnology (BACT) determination for NGS and, as a result, EPA asserted that the poten tial costs of a baghouse cannot be c onsidered as part of the BART determination. The commenter agreed that EPA cannot be certain as to whether baghouses will be required, but strongly disagreed with EPA’s argument that the potential cost cannot be considered as a result. Given the significance of th e cost associated with baghouses , the commenter believes that EPA

should consider this as a scenario in its cost-effectiveness evaluation.

An owner of NGS (0348) believes that because EPA proposed the more stringent NO x limit it is more likely that a future BACT determination w ould require installation of a baghouse because the introduction of additional layers of ca talyst – required to achieve lower NO x emissions – creates

additional oxidation of SO 2 to SO 3 , which can generate more PM emissions and therefore make more stringent PM controls such as baghouses appear more cost-effective. The commenter added that concerns regarding the possible need for a baghous e should also have been recognized by EPA as additional support for a more r easonable and achievable NO x limit for SCR that is closer to 0.080

lb/MMBtu.

The commenter (0348) submitted updated cost estimates prepared by S&L for adding baghouses along with SCR at NGS. The commenter asserted that EPA cannot dismiss these costs entirely unless it can provide assurance that baghouses would not be required as a result of its BART determination. The updated costs are presented in Tabl e 4, including the esca lation of the 2010 SCR plus baghouse cost for inflation and the scope adjustments for improved SCR performance list previously.

Table 4: Cost Estimates for SCR plus Bagh ouses Provided by SRP in 2010 and 2013 Dollars

Item Unit 1 SCR w/ Baghouse Unit 2 SCR w/ Baghouse Unit 3 SCR w/ Baghouse 2010 Costs $372,184,000 $410,919,000 $347,869,000

2013 Costs $403,442,000 $445,515,000 $376,825,000 2013 Scope Adjustments $20,955,000 $24,533,000 $21,030,000

2013 Total Costs $425,004,000 $470,487,000 $398,677,000 Total Cost for all Units $1.3 billion

Response:

EPA disagrees with the asserti on that the estimated costs of our proposed BART determination must also include the cost of baghous es due to the potential that a BA CT determination for sulfuric acid mist might require additional contro ls. As we indicated in the TSD that accompanied our Proposed Rule, EPA disagreed when this same comment was made on the ANPR. Specifically, in our TSD, EPA stated that “without undertaking a source-s pecific top-down PSD BACT anal ysis, EPA cannot determine what may be required as BACT for potenti al significant emission increases fo r sulfuric acid mist. Therefore, EPA cannot speculate what BACT for sulfuric acid mi ght be in the event a PS D permit is required for NGS.” In addition, the BART Guidelines do not requi re the BART cost analysis to include costs associated with future potential requirements from other rules or re gulations. EPA further noted that a 2009 PSD permit for the Coronado Generating Sta tion issued by the Arizona Department of Environmental Quality for increased emissions of sulfuric acid mist as a result of planned SCR installation required us e of an ultra-low SO 2 to SO 3 conversion catalyst and a sulfuric acid mistPage 33

EPA Responses to Comments: Navajo Gene rating Station Final Rule | July 28, 2014 minimization analysis, but specifical ly did not require the installati on of a new baghouse for control of

sulfuric acid mist or particulate matter. 50

In addition, as discussed in our Proposed Rule , EPA did not propose that it is necessary or appropriate under the TAR to determin e BART for PM emissions at NGS. 51 EPA noted that the PM emissions are already controlled at NGS by hot-s ide ESPs, and that the Mercury and Air Toxics Standard (MATS) that was finalized on Februa ry 16, 2012 set a filterable PM emission limit of 0.03 lb/MMBtu that NGS must comply with by 2015 or 2016. EPA understands that Units 1-3 at NGS can

meet the MATS emission limit for PM without a dditional PM controls, and that SRP has been evaluating the ability of NGS to comply with th e MATS emission limit for Hg without baghouses as

well.

Because EPA is not setting a BART limit for PM that requires installatio n of baghouses or other PM controls, and because the BART Guidelines do not require BART analyses to include compliance costs associated with other potential requirements in the future, EPA disagrees with commenters and EPA is not including the potential co sts associated with dry sorbent in jection and baghouses in the cost estimate for SCR for the purposes of BART.

Comment: Must consider $/deciview

Two of the owners of NGS (0314, 0348), a CAP agricultural water user s group (0305), and the operator of the Kayenta Mine (0384) noted that EPA’s evaluation of the BART options considered costeffectiveness only in terms of dollars per ton of emissions removed ($/ton). One of these commenters (0348) asserted that the BART Guidelines and the c ourts have reaffirmed th at the BART regulations require consideration of the degree of improvement in visibility wh en evaluating whether a technology is too costly for a partic ular source (citing 70 FR 39170; American Corn Growers Association v. EPA

, F.3d1, 1 at 6-7). The commenter stated that at the very least EPA shoul d have considered the costs of compliance in the context of both $/ton and dollars per deciview-improved ($/d eciview) before reaching a conclusion regarding the impacts of BART compliance costs at NGS.

One commenter (0348) stated th at exclusion of the degree of visibility improvement from the

assessment omits critical information that EPA mu st consider in determining BART for NGS. The commenter calculated the $/deciview for each of th e facilities EPA include d in the average costeffectiveness comparison table in its TSD (citing Ta ble 16, page 54, of the TSD for the proposed rule) and submitted a diagram purporting to consolidate the information into a single figure that shows the

cost effectiveness values in both $/ton and $/deciview for each of th e units. The commenter asserts that NGS is an outlier when the degree of visibility improvement is considered in evaluating costeffectiveness, and that the figure clearly demonstrat es that if EPA had appropr iately considered costeffectiveness, contemplating both the tons of NO x removed and the deciview improvement with respect to cost, it would have concluded that SCR at NGS is not cost-effective.

Another commenter (0314) stated that EPA lost sight of the overall purpose of the regional haze program by failing to compare the c ontrol costs as a function of visi bility improvement. According to the commenter, the NGS operator estimated the incr emental visibility cost effectiveness of the application of SCR at NGS at a pproximately $61 million per deciview, compared to a value of $13

50 See page 54 of the TSD to the Proposed Rulemaking at EPA-R09-OAR-2013-0009-0014. EPA also notes that the modeling and cost analysis is based on the use of ultr a-low SO2 to SO3 conversion catalyst for the SCR system.

51 See Proposed BART determination at 78 FR at 8279 (February 5, 2013).Page 34

EPA Responses to Comments: Navajo Gene rating Station Final Rule | July 28, 2014 million per deciview for LNB/SOFA; including baghouses with SCR increases the incremental visibility cost effectiveness to approximately $13 billion per deciview. The commenter asserted that this is a 5- to 10-fold difference in visibility cost effectivenes s and demonstrates that only advanced combustion

controls are cost effective in terms of regional haze BART.

The operator of the Kayenta Mine (0384) quoted the NREL report as saying that installation of SCR at NGS would cost $33 million pe r year per deciview improvement, a cost to benefit ratio larger than those calculated for BART controls proposed fo r other units in the region even if the other units were to install SCR. This commenter (0384) asserted that this conclusion is even stronger when one considers the significant cost if NGS were to close, which would increase the cost per deciview per year by an additional $571+ million (based on the ASU ec onomic study of $20 billion economic benefit to Arizona between 2009-2044) and bring the total to almost $600 million pe r deciview per year, vastly exceeding any other comparable SCR installation. The commenter went on to contend that a closure of one-third of NGS under the Supplemental Proposal results in $153 million per deciview per year (assuming a $4.2 billion decrease in value due to the closing), which the commenter believes is also vastly in excess of any other comparable SCR installation.

The CAP agricultural water users group (0305) no ted that the BART Guidelines define cost

effectiveness as “a criterion used to assess the potential for achieving an objective in the most economical way” (citing 40 CFR part 51, Appendix Y, section IV.D4.b). The commenter stated that since the objective of CAA section 16 9A is the remediation and prevention of visibility impairment, a proper factor 1 analysis of cost e ffectiveness must assess th e visibility improvement s that result from the

control alternatives as a result of emissions re ductions. The commenter belie ves that EPA’s reliance on

cost-effectiveness metrics alone to conclude that SCR is cost-effective is arbitrary.

Response:

EPA disagrees with the assertion that our analysis of Factor 1 (c ost of compliance) is arbitrary because we focus on average and incremental cost-e ffectiveness. We also disagree that the BART Guidelines require consideration of $/deciview. While a $/deciview metric may provide some useful information to assess how pollution controls would benefit Class I areas, the BART Guidelines do not require consideration of $/deciview as a mandatory metric in a BART analysis. The BART Guidelines

are clear that certain calculations mu st be included in consideration of the cost of controls, including total capital costs, total a nnual costs, and average and in cremental cost effectiveness. 52 The $/deciview metric is identified by the BART Guidelines as an example of “other cost-eff ectiveness measures” that

can be considered under the cost of compliance. Specifically, under th e section titled “How do I select the ‘best’ alternative, using th e results of Steps 1 through 5?”, the BART Guidelines recommend developing a chart (or charts) disp laying for each of the alternatives various pieces of information, including “Costs of compliance – total annualized co sts ($), cost effectiveness ($/ton), and incremental cost effectiveness ($/ton), and/or any other cost effectiveness measures ( such as $/deciview)” (emphasis added). Therefore, while $/deciview is another measure that can be considered in addition to the other metrics of cost-effectiveness, it is not required, and a methodology for calculating $/deciview was not described in any detail elsewh ere in the BART Guidelines. 53

52 See BART Guidelines, 70 FR 39104 at 39166-39167 (July 6, 2005), which describes the steps needed to evaluate the cost

of controls.

53 The BART Guidelines describe in great detail how incrementa l cost should be calculated. In contrast, the Guidelines provide no instruction on the calculation of $/deciview. Arguably, $/deciview can be calculated any number of ways using a combination of many cost and visibility metrics, including total capital cost, total annual cost, annual deciview improvementPage 35

EPA Responses to Comments: Navajo Gene rating Station Final Rule | July 28, 2014 EPA considered cost of controls by discussing the total capital co sts, total annual costs, $/ton, and incremental $/ton, and consider ed visibility impacts by discussi ng the individual and cumulative deciview improvement resulting from SCR, as well as the percent change in improvement. We further note that EPA did calculate the anticipated $/deciview of the three control options in Table 10 of our Proposed Rule. 54 EPA calculated the $/maximum deciview ($/m ax dv) based on the total annual cost of controls and the highest projected 98 th percentile improvement in visi bility at all 11 Class I areas

modeled from that control technolo gy, as well as the $/cumulative deciview based on the total annual cost of controls and the sum of all projected 98 th percentile visibility impr ovements for all 11 Class I areas. For LNB/SOFA, the $/max dv was $2.5 million per maximum deciview and the $/cumulative dv was $0.3 million per cumulative deciview. For SN CR+LNB/SOFA, the $/ma x dv was $9.3 million and the $/cumulative dv was $1.3 million. For SCR, the $/max dv was $11.8 million and the $/cumulative dv was $1.8 million. Although EPA disagrees with commente rs that we must consider $/deciview as a metric under Factor 1, we also disagree with comment ers that we completely excluded consideration of the metric from our analysis. Rather than include cal culations of $/deciview under Factor 1, we instead included $/deciview under Factor 5.

One commenter cited to its calcul ated $/deciview for SCR at NGS to suggest that NGS is an outlier compared to other BART determinations wh ere SCR was required (i.e., Naughton, Four Corners, San Juan, Hayden, and Craig Unit 2) when the degree of visibility improvement is considered in evaluating cost-effectiveness (i.e., the commenter plot ted average cost-effectiveness in $ per ton on the x-axis and cost per decivew on the y-axis). 55 The commenter calculated $/deciview for NGS for SCR controls at over $60 million per deciview a nd cost-effectiveness at nearly $3,000 per ton. 56 The commenter suggests this $/deciview value is substantially higher than other BART determinations where average cost-effectiveness ranged from less than $2,000 per ton to n early $5,000 per ton, and cost per

deciview for all facilities was less than $20 million per deciview. As noted above, EPA reported in Table 10 of our Proposed Rule a $/deciview valu e for SCR+LNB/SOFA of $11.8 million per deciview (calculated from total annual cost of approxi mately $64 million per year and maximum modeled visibility improvement from SCR+LNB/SOFA of 5.4 deciviews). The commenter did not provide the basis for the $/deciview values it asserted in its letter, but a $/ deciview value for SCR of over $60 million per deciview was likely calcul ated assuming its own values of total annual cost of $80 million per year for SCR+LNB/SOFA and its own maxi mum modeled visibility improvement from

SCR+LNB/SOFA of 1.27 dv. 57 The commenter also did not provide the basis for the $/deciview and $/ton estimates it cited for other BART determin ations, therefore the comment does not provide any basis for EPA to determine whether the comparisons offered by the commenter are “apples to apples”. EPA notes, however, that the $/deciview and $/ton estimates EPA provided in our Proposed Rule ($11.8 million per deciview and less than $3,000 per ton) ar e entirely consistent w ith the range of costat the most impacted Class I area, annual decivi ew improvement at all impacted Class I areas, 98 th percentile improvement at the most impacted area or all impacted Class I areas. EPA has reported $/deciview based on total annual cost divided by either the largest 98 th percentile improvement and total annual cost divided by the sum of the 98 th percentile improvements from all impacted Class I areas within 300 km of the source. See Table 10 in 78 FR at 8287 (February 5, 2013).

54 See Table 10 in 78 FR at 8287 (February 5, 2013).

55 See Figure 8, page 43, of SRP comment letter dated January 6, 2014 at EPA-R09-OAR-2013-0009-0348.

56 The commenter also plotted the SCR+Baghouse case at nearly $6,000 per ton and over $120 million per deciview. EPA is does not understand where the $13 billion per deciview for SCR+Baghouse, cited by one of the commenters (0314) and attributed to an analysis from SRP, comes from.

57 See Table 2 in EPA’s Proposed Rule for total annual cost of SCR+LNB/SOFA projected by SRP. See SRP’s January 20, 2012 Updated BART Analysis showing visibility benefits from SCR+LNB/SOFA (as sum of maximum incremental improvements of 0.54 dv (baseline to LNB/SOFA), 0.29 (LNB/SOFA to SNCR), and 0.44 (SNCR to SCR)).Page 36

EPA Responses to Comments: Navajo Gene rating Station Final Rule | July 28, 2014 effectiveness values cited by the commenter for BART determinations for other facilities as shown in the commenter’s graph (i.e., averag e cost-effectiveness ra nged from less than $2,000 per ton to nearly $5,000 per ton, and cost per deciview for all fac ilities was less than $20 million per deciview).

EPA further notes that in previous EPA BART determinations (e.g., Four Corners Power Plant and San Juan Generating Station), EPA did not include $/deciview calc ulations, therefor e, it is unclear how the commenter generated its values for $/deciview for these facilities. 58 The commenter’s diagram included 8 data points representing five facilities , but did not identify which point corresponded to which facility, or provide the underlying data for its calculations. For Four Corners, EPA finalized a BART determination requiring SCR on Units 1-5 as we ll as a better than BART alternative that involved

closure of Units 1-3 and installa tion of SCR on Units 4 and 5. EPA’s estimated total annual cost of BART was $93 million per year and SCR installati on on Units 4 and 5 only was approximately $57.5 million per year. 59 EPA’s modeling analysis show ed the largest anticipated visibility improvement from

BART to be 2.85 dv and from the BART Alternative to be 3.76 dv. 60 This corresponds to a $/deciview value of $33 million per deciview fr om BART at Four Corners and $15 million per deciview from the

Four Corners BART Alternative. For San Juan Gene rating Station, EPA estimated the total annual cost of SCR on Units 1-4 to be approximately $30 million per year, and estimated the largest visibility improvement to be 3.11 dv, resulting in a $/deci view value of nearly $10 million per deciview. 61 Although the $/deciview values for EPA’s BART Alternative for Four Corners and EPA’s BART determination for San Juan are generally consistent with the values depicted by the commenter, these

values are based on EPA’s own estimates for cost a nd visibility improvement, which differed from those provided by the facilities. 62 Thus, the commenter’s comparison between SRP’s cost and modeling results for NGS, with results for other facilities that are likely based on EP A cost and modeling, is misleading, particularly because the comparisons ar e not an apples to apples comparison and the commenter did not provide the basis for its depictions of $/deciview and $/ton estimates for SCR for any facility. Notwithstanding the uninformative nature of the commenter’s diagram, EPA notes that NGS is not an outlier in the commenter’s diagram because the $/deciview and $/ton estimates that EPA provided for SCR at NGS in our pro posed rule are consistent with t hose depicted by the commenter as representing those of BART dete rminations for other facilities.

Comment: Cost-Effectiveness of Presumptive BART

One of the owners of NGS (0348) stated that in establishing presumptive limits in its BART Guidelines, EPA recognized that SCR is not cost effective and that combustion controls such as LNB/SOFA represent the most cost -effective control opti ons for most boiler types. The commenter pointed out that in establishing presumptive limits, EPA considered controls that cost less than $1,500/ton to be cost effective, and that the cost effectiveness in $/ton for SCR at NGS, which ranges from $3,000 $6,000 per ton based on 2010 estimates, is we ll above this threshold. The commenter

58 In the final rulemakings for Four Corners and San Juan, EPA stated that, for several reasons, EPA was not using the $/deciview metric for BART purposes, and was considering co st-effectiveness in conjunction with our assessments of the modeled visibility benefits of BART controls. See 76 FR 523 88 at 52395 (August 22, 2011) and 77 FR 51620 at 51623 (August 24, 2012).

59 See Table 15 of the TSD to EPA’s proposed BART determination for Four Corners Power Plant (dated October 19, 2010) available at EPA-R09-OAR-2010-0683-0002, at http://www.regulations.gov/#!docketBrowser;rpp=2 5;so=ASC;sb=docId;po=0;D=EPA-R09-OAR-2010-0683

60 See Table 10 in the Supplemental Proposal for Four Corners Power Plant, 76 FR 10530 at 10540 (February 25, 2011).

61 See Tables 7 and 8 in EPA’s proposed rule for San Juan Generating Station, 76 FR 491 at 503 (January 5, 2011).

62 See, for example, discussion in Final Rule for FCPP at 77 FR at 51622 and 51629 (August 24, 2012), and discussion in Final Rule for SJGS at 76 FR at 52392 to 52396 and 52427 (August 22, 2011).Page 37

EPA Responses to Comments: Navajo Gene rating Station Final Rule | July 28, 2014 concluded on this basis that even if the cost of control options are compared on a $/ton basis alone, EPA should have rejected SCR and adopt ed LNB/SOFA as BART for NGS.

Another owner of NGS (0315) also compared EP A’s estimate for the cost -effectiveness of SCR to cost-effectiveness values published in EPA documents when the RHR was finalized in 2005. According to this commenter, EPA’s cost-effectiv eness estimate for SCR+LNB/SOFA at NGS (which the commenter asserts is too low) is three to f our times higher than the value the EPA determined through notice and comment rulemaking to be cost-eff ective controls (i.e., co mbustion controls with average cost effectiven ess of $600 per ton of NO

x removed), and significantly higher than the $1,600 per

ton that EPA determined was not cost effective (citing 70 FR 39131 and the RHR TSD). The commenter asserts that this is an arbitrary shift in policy.

Response:

EPA disagrees with the commenters’ assertion that the BART Guidelines established a threshold for cost-effectiveness against which all future BART determinations must compare. In developing the presumptive NO x limits for BART in 2005, EPA did not set th e cost-effectiveness values estimated for

combustion controls as the threshold for determini ng whether a given control technology was or was not

cost-effective. If EPA had intende d the cost-effectiveness values estimated in 2005 to represent a threshold for BART, it is reasonable to assume that the BART Guidelines would have included those

cost-effectiveness values as threshol ds in Appendix Y, and would have re quired future cost estimates to be presented in 2005 dollars to appropriately compar e against those thresholds. The BART Guidelines

do not set a numerical definition for “cost-effective”, and the analysis of presumptive limits uses costeffectiveness as a means to broadly compare contro l technologies, not as a threshold for rejecting controls for an individual unit or facility that ex ceed the average cost-effectiveness of combustion

controls.

In addition, a comparison of the average co st-effectiveness estimates in the 2005 BART Guidelines against EPA’s cost-effectiveness estimat es for NGS (based on 2010 or 2013 dollars) is not an “apples to apples” comparison. The technical support documenta tion for the 2005 BART Guidelines 63

indicates that cost effectiveness of controls was not determined ba sed on site-specific cost estimates developed for each BART-eligible facility; rather cost estimates were determined using assumptions for capital and annual costs per kilowatt (kW) 64 or kilowatt-hour (kW-hr), a nd then scaled according to

boiler size. The same commenter ha s previously dismissed the SCR co st estimates for NGS, developed by the National Park Service based on the EPA Cont rol Cost Manual, as be ing too low (ranging from $88 – 96 per kW, which is only slightly lower than $100 per kW used in the 2005 BART Guidelines for the presumptive limit analysis) because it is out dated and does not include site-specific costs. 65 In contrast, Table 5.1 in SRP’s 2009 comment letter esti mates capital costs of SCR at NGS ranging from

63 The technical supporting information is included in the docket for the final rulemaking for the BART Guidelines (EPAHQ-OAR-2002-0076) and includes several documents supporting the presumptive NO

x limits finalized in the BART Guidelines: (1) “Technical Support Document – Methodology for Developing BART NO

x Presumptive Limits” dated June 15, 2005 (document no. EPA-HQ-OAR-2002-0076-0445), and (2) “Technical Support Document for BART NO

x limits for Electric Generating Units Excel Spreadsheet”, dated June 15, 2005 (document no. EPA-HQ-OAR-2002-0076-0446).

64 In the 2005 BART presumptive limit analysis, EPA estimated capital cost assu ming SCR cost = $100/kW.

65 In the ANPR, in addition to reporting SRP’s cost estimates and EPA’s revisions to SRP’s co st estimates, for reference, EPA also reported results from a cost estimate analysis cond ucted by the National Park Service and provided to EPA during consultations with the FLMs prior to our ANPR. SRP provided comments to EPA on the NPS cost estimates reported in the ANPR, see section 5.1 (page 29) in document titled “Comment letter from Hayslip, Salt River Project” document ID number

EPA-R09-OAR-2009-0598-0126. Available at: http://www.regulations.gov/#!docketB rowser;rpp=50;so=DESC;sb=docId;po= 100;dct=PS;D=EPA-R09-OAR-2009-0598

.Page 38

EPA Responses to Comments: Navajo Gene rating Station Final Rule | July 28, 2014 $264 to 356 per kW. The commenter appears to be se lectively choosing to accept the EPA Control Cost Manual in one case ( to establish the cost-effectiv eness from the 2005 presumptive limit analysis to serve as a bright line threshold), and reject it in another (for dete rmining cost effectiveness of postcombustion controls at NGS): on one hand, the commenter rejected the EPA Control Cost Manual in favor of its own site-specific cost estimates becaus e the EPA Control Cost Manual is unrealistically low, and on the other hand, the commenter uses the” unreal istically low” value from the EPA Control Cost Manual as a threshold to reject post-combustion controls because its updated and site-specific cost estimates are higher. In short, the commenter’s reco mmendation to use generalized cost estimates from the 2005 BART Guidelines as a brig ht line threshold for comparison wi th site-specific 2010 or 2013 cost

estimates is inconsistent with its own cr iticisms of the EPA Control Cost Manual.

Comment: Erroneous calculation of incr emental cost effectiveness

A CAP agricultural water users group (0305) as serted that EPA failed to follow the BART Guidelines’ procedure for calculating incremental cost effectiveness. Th e commenter stated that because of this failure, EPA erroneously overestimated the incremental cost effectiveness of SCR relative to SNCR, arbitrarily and capriciously bias ing its factor 1 analysis in favor of SCR. The commenter asserted that EPA (1) incorrectly identified the dominant control options and (2 ) incorrectly calculated

incremental cost effectiveness.

Regarding EPA’s alleged misidentification of th e dominant control optio ns, the commenter made the following arguments:

 In its analysis, EPA identified the “least-cos t envelope” (dominant) control options as LNB/SOFA, SNCR (at 0.015 lb/MMBtu), and SCR (a t 0.055 lb/MMBtu), and identified SCR at

0.08 lb/MMBtu and SNCR at 0.18 lb/MMBtu as inferior control options.

 Nevertheless, EPA did not consider the incr emental cost effectiveness of SNCR at 0.015

lb/MMBtu but rather evaluate d the inferior control opti on of SNCR at 0.018 lb/MMBtu, justifying this decision on the fact that SRP indicated that SNCR at NGS would achieve roughly 0.18 lb/MMBtu. This is arbitrary and capricious b ecause it fails to follow the BART Guidelines’

instructions to consider domina nt control options in calculating incrementa l cost effectiveness.

 EPA could properly determine that SNCR at 0.15 lb/MMBtu is not a technically achievable control option, and did so in the TSD by accepting SRP’ s assertion that this is the case. However,

EPA should have removed consideration of the cont rol option from its entir e five-factor analysis.

 In addition, EPA accepted SRP’s assertion that SNCR at 0.15 lb/MMBtu is not technically achievable, but arbitrarily rejected SRP’s assertion that SCR at 0.055 lb/MMBtu is not technically achievable. This inconsistency is ar bitrary and capricious, a nd EPA should revise its incremental cost effectiveness analysis to ensu re that it properly se lects and considers only

dominant control alternatives.

Regarding its contention that EPA in correctly calculated incremental co st effectiveness, the commenter made the following assertions:

 EPA’s underlying data show that installing SNCR at NGS would have a total annual cost of approximately $23.5 million and would reduce NO

x emissions between 16,600 and 19,500 tpy, while installing SCR at NGS units would have a total annual cost of between $61 and $64Page 39

EPA Responses to Comments: Navajo Gene rating Station Final Rule | July 28, 2014 million with NO x emission reductions between 26,200 and 28,500 tpy. Thus, on a total annualized cost basis, SCR costs more than twice as much as SNCR, and reduces about 50 percent more emissions. These data contradict EP A’s incremental cost effectiveness calculations, because if SCR is truly more efficient at the margin than SNCR, spending twice as much money

on SCR should result in more than twi ce the level of emissions reductions.

 EPA has failed to follow the procedure outlined in the BART Guidelines for proper calculation of incremental cost, which require calculation of incremental cost effectiveness between just the dominant control options that EP A has identified, and not the in ferior options, using the leastcost envelope data.

 Recalculating incremental cost effectiveness us ing EPA’s identified domin ant control option of SNCR at 0.15 lb/MMBtu yields incremental cost effectiveness of $2,128/ton for SNCR versus LNB/SOFA and $4,451/ton for SCR versus SNCR. EPA’s erroneous calculations using the inferior control option of SNCR at 0.18 lb/MMBtu unduly bias EPA’s incremental cost estimates in favor of SCR and against SNCR.

 The conclusion that EPA’s calculations are inco rrect is also supported by EPA’s least-cost envelope, which contains a least-cost curve w ith increasing slope. This means the incremental cost effectiveness between dominant control opti ons, which is calculated as the slope of the curve, should get progressively grea ter as they get more expensive.

 EPA’s conclusion that that SCR is the most incr ementally cost-effective control alternative, and the incremental cost-effectiveness data underlyi ng it in Table 3 of the February 2013 Proposal,

are erroneous.

Response:

EPA disagrees with the asserti ons that our calculations of in cremental cost-effectiveness were erroneous and biased our analysis in favor of SCR. We reporte d values for incremental costeffectiveness in Table 3 of our Proposed Rule, in Table 15 of the TSD to our Proposed Rule, and included the underlying calculati ons in a worksheet in the docket for this rulemaking. 66 The assertions

stem from cost and cost-effectiveness calculations for SNCR based on two assumptions for the level of control SNCR may achieve, i.e., 0.15 lb/MMBtu and 0.18 lb/MMBtu. EPA’s TSD for the Proposed Rule included descriptions of the various submittals from SRP. In their original BART analysis, SRP assumed

that SNCR could achieve an emission rate of 0.20 lb/MMBtu. 67 In a subsequent submittal (dated January 20, 2012), SRP described retaining Fuel Tech Incorpor ated to develop a com putational fluid dynamics

model to maximize NO x removal from SNCR. SRP included averag e and incremental cost calculations using two potential levels of control with SNCR (at equivalent cost): 0.15 lb/MMBtu and 0.18 lb/MMBtu. Subsequently, in a lette r dated July 20, 2012, SRP indicated that, based on initial testing, it expected SNCR to achieve an emission rate of roughly 0.18 lb/MMBtu, and recommended a limit of 0.20 lb/MMBtu that includes a margin for compliance. 68

In our cost-effectiveness analysis for our Propos ed Rule, EPA included calculations for SNCR at 0.15 and 0.18 lb/MMBtu; however, as stated in our TS D and as reflected in Table 3 of the Proposed Rule and Table 15 of the TSD, EPA evaluated and reported the average and incremental cost66 See TSD for the proposed rule at EPA-R09-OAR-2013-0009-0014, and docume nt titled “2013_0101 NGS emissions and

incremental costs.xlsx” in th e docket for this rulemaking at EPA-R09-OAR-2013-0009-0004.

67 See, for example, Table 6 in the TSD for the Proposed Rule based on SRP’s January 2009 Revised BART Analysis.

68 See document titled “2012_0120 SRP Updates NGS BART Report.pdf” in the docket for the proposed rule at EPA-R09-

OAR-2013-0009-0005.Page 40

EPA Responses to Comments: Navajo Gene rating Station Final Rule | July 28, 2014 effectiveness of SNCR at a level of 0.18 lb/MMBtu. Th is value represents the approximate mid-point of the range of options SRP has provided to EPA related to SNCR over time (0.15-0.20 lb/MMBtu) and was the level SRP expected to achieve based on in itial testing. Although our Proposed Rule and TSD evaluated SNCR at 0.18 lb/MMBtu, and our TSD provided an explanat ion of the chronology and history

of SRP’s submittals related to SNCR and the rati onale for our evaluation of SNCR at 0.18 lb/MMBtu instead of 0.15 lb/MMBtu, for comple teness, our cost-effectiv eness worksheets that we included in the docket for our Proposed Rule continued to includ e evaluations of SNCR at 0.15 lb/MMBtu and 0.18

lb/MMBtu.

The commenter states that EPA evaluated the least-cost envelope for controls for NGS and

determined the dominant controls to be LN B/SOFA, SNCR at 0.15 lb/MMBtu, and SCR at 0.055

lb/MMBtu. This is consistent with the graph we developed on the tab ti tled “least cost envelope” in our

cost-effectiveness worksheet. The commenters assert th at because the graph of the least cost envelope

excluded SNCR at 0.018 lb/MMBtu from the least co st envelope (i.e., indi cating that SNCR at 0.018 lb/MMBtu was an inferior control option), EPA shoul d not have evaluated SNCR at this control level. Similarly, because SCR at 0.08 lb/MMBtu was also not on the least cost envelope, it was also an inferior control option that should not have been evaluated. The commenters assert that our decision to evaluate the inferior SNCR level (i.e., 0.18 lb /MMBtu) in lieu of the dominant control (i.e., 0.15 lb/MMBtu) was

inconsistent with the BART Guidelines and arbitrar y and capricious given our evaluation of SCR at both

inferior and dominant levels (i.e., 0.08 and 0.055 lb/MMBtu).

EPA disagrees with this assertion. SRP’s submissions indicated the possibility that, at equivalent cost, SNCR at NGS might achieve emission rate s in the range of 0.15- 0.18 lb/MMBtu. SRP later confirmed, based on initial testing, that SNCR did not perform as well as expected, and that it achieved emission rates of approximately 0.18 lb/MMBtu (and recommended a limit of 0.20 lb/MMBtu). The

actual achievable emission rate a ssociated with SNCR was expected to be controlled by the fluid dynamics of air flow in the flue gas and mixing of ammonia as well as acceptable levels of ammonia slip, and was not expected to be determined by cost. 69 Therefore, for our proposed rule, EPA evaluated

SNCR at the level SRP indicated was achievable base d on their initial testing (i.e., 0.18 lb/MMBtu). This was not an arbitrary decision. For SCR, in the TSD for the proposed rulemaking, EPA articulated our rationale for determining that SCR systems c ould be designed for achieving either 0.08 lb/MMBtu or 0.055 lb/MMBtu, at differing cost , depending on the design target and the number of layers of catalyst initially deployed. 70 Therefore, our evaluation of SCR at tw o different levels of control (at two different costs) was also not arbitrary.

The commenter asserted that our evaluation of SNCR at 0.18 lb/MMB tu unduly biased EPA’s incremental cost-effectiveness estimates against SNCR. 71 The commenter recalculated incremental costeffectiveness of SCR based on SNCR at 0.15 lb/MMB tu and asserted that the incremental costeffectiveness would have been $4,45 1 per ton and the incremental co st-effectiveness of SNCR versus LNB/SOFA would have been $2,128 per ton. EPA disagr ees with the assertion that our evaluation of

SNCR at 0.18 lb/MMBtu biased our evaluation of SCR or SNCR. As discussed above, EPA’s evaluation

69 Id , page 3.

70 See Table 14 of the TSD for the Propose d Rule. EPA also notes that SRP had previously stated that it would design the SCR system as a 2+2 system with a target of 0.05 lb/MMBtu to meet a limit of 0.08 lb/MMBtu. EPA’s proposed BART limit of 0.055 lb/MMBtu was based on a 3+1 system. In their comment letter (as discussed in Section 8.1 of this response to comments document), SRP indicated it would design a 3+1 system to meet a design target of 0.03 lb/MMBtu but would still require a limit of 0.08 lb/MMBtu. Because EPA and SRP are no w in agreement on the 3+1 design of the SCR system, the cost estimates for SCR for the final rule are not expected to differ based on the number of initial catalyst layers.

71 We note that EPA could have evaluated SNCR at 0.20 lb/MMBtu, and if we had done so, this level for SNCR would have

resulted in incremental cost-effectiveness numb ers that favored SCR to a greater extent.Page 41

EPA Responses to Comments: Navajo Gene rating Station Final Rule | July 28, 2014 of SNCR at 0.18 lb/MMBtu was reasonable. However, even if we chose to accept the incremental costeffectiveness values calculated by the commenter, it would not change our determination that SCR is

cost-effective at NGS.

The commenter asserts that our calculation of incremental cost-effectiveness is erroneous

because we calculated incremental cost of SCR+LNB/ SOFA to be lower than the incremental cost of SNCR+LNB/SOFA, whereas a least-co st curve should be one of in creasing slope, therefore, the incremental cost of controls should get increasingl y greater as the level of controls becomes more stringent. A least-cost curve of constantly increa sing slope (as depicted in the BART Guidelines) is

theoretical. EPA’s calculations for incremental cost -effectiveness were mathematically correct. Real

data for annual cost and annual emission reductions c ould result in least cost envelopes that look like a straight line if incremental cost-e ffectiveness between controls is si milar (e.g., if SNCR does not achieve an emission rate as low as expected). 72

Similarly, the commenter also asserts that if S CR is truly more efficient at the margin than SNCR, spending twice as much on SCR should resu lt in more than twice the level of emission reductions compared to SNCR. Th e commenter appears to confusi ng average cost-effectiveness and

incremental cost-effectiveness. A lthough the commenter references incremental cost-effectiveness, the idea that spending twice as much should result in twice the level of emission reductions is actually

related to average cost effectiveness, not incremental cost-effectiveness. EPA estimated the total annual cost of SCR+LNB/SOFA to be $64 million and result in emission reductions of 28,573 tons per year.

EPA also estimated the total annual cost of SNCR +LNB/SOFA to be $29 million and result in emission reductions of 16,608 tons per year. 73 EPA agrees that SCR is more th an double the annual cost of SNCR

but does not reduce NO x emissions by more than double that of SNCR. EPA’s calculations reflect this

because the average cost-effectiveness of SCR ($2,240 per ton) is higher than the average costeffectiveness of SNCR ($1,745 per ton). 74 The commenter appears to be concerned that EPA’s

calculation of incremental cost-e ffectiveness of SNCR+LNB/SOFA ( $4,110 per ton) is higher than

incremental cost-effectiveness of SCR+LNB/SOFA ($2,933 per ton). The incremental cost-effectiveness is a comparison of the costs and performance between two levels of control. In other words, EPA

calculated the incremental cost-effectiveness of going from LNB+SOFA to SNCR+LNB/SOFA as $4,110 per ton (i.e., annual cost of LNB/SOFA is $5 million and reduces NO

x by 10,865 tons per year,

therefore incremental cost-eff ectiveness between LN B/SOFA and SNCR+LNB/SOFA was calculated approximately as [$29 million per year minus $5 million per year] divided by [16,608 tons per year minus 10,865 tons per year]). The incremental cost -effectiveness of SNCR+L NB/SOFA is relatively high because the total annual cost of SNCR+LNB/SO FA is roughly 6 times higher than LNB/SOFA but

the total emission reductions from SNCR+LNB/SOFA is only 1.5 times larger than LNB/SOFA. In contrast, the incremental cost of going from SN CR+LNB/SOFA to SCR+LNB/ SOFA is lower because

the total annual cost of SCR+LNB/SOFA is r oughly 2.2 times higher than SNCR+LNB/SOFA and the

total emission reductions from SCR+LNB/SOFA is roughly 1.72 tim es higher than SNCR+LNB/SOFA. The commenter is focusing only on the compar ison between SCR and SNCR and neglecting the

72 See “2013 Least Cost Envelope” Tab in the document titled “2014_0304 NGS emissions and incremental costs.xlsx” in the docket for this rulemaking.

73 The commenter cites an approximate annual cost of SNCR at $23.5 million and emission reductions from SNCR between 16,600 tons per year (i.e., SNCR at 0.18 lb/MMBtu) and 19,500 tons per year (SNCR at 0.15 lb/MMBtu). The commenter also cites an approximate annual cost of SCR between $61 to 64 million and emission reductions from SCR between 26,200 tons per year (SCR at 0.08 lb/MMBtu) and 28,500 tons per year (SCR at 0.055 lb/MMBtu). The commenter’s citations differ

from EPA’s because EPA evaluated SNCR+LNB/SOFA and SCR+LNB/SOFA.

74 See Table 3 of EPA’s proposed rule (78 FR at 8281, February 5, 2013).Page 42

EPA Responses to Comments: Navajo Gene rating Station Final Rule | July 28, 2014 comparison between SNCR and LNB/SOFA when attempting to understand incremental costeffectiveness.

The commenter recognizes that EPA could have determined SNCR at 0.15 lb/MMBtu was not technically achievable and removed it from our anal ysis. EPA agrees that th is would have been less confusing. Therefore EPA has removed evaluation of SNCR at 0.15 lb/MMBtu fr om our revised costeffectiveness spreadsheets based on the updated 2013 cost estimates. 75 However, EPA disagrees that our analysis was erroneous or arbitrary because it in cluded additional information on SNCR, i.e., SNCR at 0.15 lb/MMBtu that was generated over the course of our BART analysis, but was later determined to be

unachievable.

Comment: Apples-to-oranges comparison of costs

A CAP agricultural water users group (0305) stated that EPA presented and compared inconsistent cost information from EPA and SRP, with the result that the figures appear more consistent with each other than they actually are. According to the commenter, it appears that the SRP cost information was generated using a theoretical NO x emission limit of 0.08 lb/MMBtu for SCR, while EPA used a 0.055 lb/MMBtu limit. To appropriately compare EPA and SRP cost data, EPA should revise its cost analysis to pres ent its cost data relating to a NO x limit of 0.08 lb/MMBtu.

Response:

EPA disagrees with the assert ion that in our proposed rulema king, we presented and compared

inconsistent cost information from EPA and SRP in order to make the values appear more consistent with each other than they actually are. In our Ru le, we noted that the aver age and incremental cost

calculations that were attributed to SRP were i ndeed based on values submitted by SRP, based on the assumption that SCR would achieve an emission rate of 0.08 lb/MMBtu. 76 In contrast, the values EPA reported for SCR were based on the assumption th at SCR would meet an emission limit of 0.055 lb/MMBtu. As discussed in the TSD for our proposed rule, EPA calculated total and annual costs of SCR assuming 3 layers of catalyst (equivalent to a limit of 0.08 lb/MMBtu) and 4 layers of catalyst (equivalent to a limit of 0.055 lb/MMB tu). EPA disagrees that it was inappropriate to compare EPA’s

cost-effectiveness estimate for S CR at 0.055 lb/MMBtu with SRP’s co st-effectiveness for SCR at 0.08 lb/MMBtu, because both estimates were based on an emission limit each entity has determined is achievable with that technology, and the cost associated with that level of control. EPA notes that in our

cost-effectiveness worksheets includ ed with our Proposed Rule, EPA di d calculate cost-effectiveness of SCR at 0.08 lb/MMBtu, as r ecommended by the commenter. 77 This value was $2,341 per ton, which is (contrary to what the commenter asserted) even closer to the va lue reported by SRP of $2,926 per ton. Therefore, even if we agreed with the commen ter, this revised value would not change our

determination that SCR is cost-effective at NGS.

Comment: Conclusions on cost

75 See “2013 Least Cost Envelope” Tab in the document titled “2014_0304 NGS emissions and incremental costs.xlsx” in the docket for this rulemaking.

76 See proposed rule 78 FR 8274 at 8280 and footnote 31.

77 See tab titled “2010-12 and EPA cost estimates” within document titled “2013_0101 NGS emissions and incremental

costs.xlsx” at EPA-R09-OAR-2013-0009-0004.Page 43

EPA Responses to Comments: Navajo Gene rating Station Final Rule | July 28, 2014 One of the owners of NGS (0348) stated th at regardless of whether EPA considers the commenter’s 2010 or 2013 cost estimates, and whether the EPA excludes line items from the total costs,

it is clear that SCR is not a cost-effective BART control option for NGS. The commenter asserted that its previous BART submittals (inc luding the 2012 BART report attached to the comments as Appendix K), LNB/SOFA achieves greater incremen tal visibility improvement than post combustion controls, at a fraction of the cost. According to the commenter, th e cost of SCR exceeds that of LNB/SOFA by more than a factor of 14, and by more than a factor of 28 if baghouses are also re quired, and LNB/SOFA also

achieves an emission rate that is well below the presumptive BART limit of 0.28 lb/MMBtu established by the EPA for the type of boilers at NGS. The comm enter asserted that if EPA had given adequate

consideration to this information in developing its BART proposal, it would have concluded that SCR cannot be justified given its significant cost and the small degr ee of visibility improvement it would provide relative to othe r BART control options.

One tribal government (0039/0317) disagreed with the EPA determ ination that th e average cost
effectiveness of the combination of SCR+LNB/SO FA versus SNCR+LNB/SOFA, where SCR is nearly 30 percent higher, is not substantial.

Response:

EPA agrees that consideration of 2010 versus 20 13 costs and the inclusion of the line item costs that EPA excluded from SRP’s cost analysis do not change our overall conclusion on Factor 1. However, EPA disagrees with the co mmenter’s assertion that the conc lusion on Factor 1 should be that SCR is not cost-effective. EPA proposed that SCR is cost-effective for NGS based on our evaluation of the average and incremental cost-effectiveness of SCR.

Conclusions related to the anticipated visibility improvements (i.e., Factor 5) are discussed in more detail in Section 7 of this response to co mments document. Although the commenter is correct in stating that their January 2012 Updated BART An alysis indicates the in cremental visibility improvement of LNB/SOFA is great er than the incremental visibili ty improvement of post-combustion controls, EPA notes that the comm enter provided incremental visibi lity improvement from (1) baseline to LNB/SOFA, (2) LNB/SOFA to SNCR, and (3), SN CR to SCR. It is also instructive to compare LNB/SOFA to SCR (as EPA has done for incremental cost in our proposed rule, e.g., Table 3 in our Proposed Rule). The commenter, using its preferred a ssumptions for the visibility modeling which differ from those used by EPA (see Section 7 of this re sponse to comments documen t), modeled an average visibility benefit of 0.37 dv when going from ba seline conditions to LNB/SOFA, an incremental visibility benefit of 0.15 dv when going from LNB/SOFA to SNCR (at 0.18 lb/MMBtu), and an incremental visibility benefit of 0.27 dv when going from SNCR (a t 0.18 lb/MMBtu) to SCR (at 0.08 lb/MMBtu). EPA notes that the commenter modeled an average visibility benefit when going from LNB/SOFA to SCR of 0.42 dv, which is greater than the visibility benefit of going from baseline to LNB/SOFA. The commenter also reported the larges t improvement in visibility (i.e., maximum) was 0.54 dv when going from baseline to LNB/SOFA, 0.29 dv when going from LNB/SOFA to SNCR (at 0.18 lb/MMBtu), and 0.44 dv when going from SNCR to SCR (at 0.08 lb/MMBtu). Thus, when going from LNB/SOFA to SCR, the largest improvement in vi sibility is 0.73 dv, which is also larger than the visibility benefit of going from baseline to LN B/SOFA. Although incrementa l visibility improvement can be an informative metric, EPA does not find the results of the commenter’s modeling compelling to change our conclusion that SCR at NGS is cost-effec tive and will reduce the impact of NGS on visibility impairment at 11 Class I areas.Page 44

EPA Responses to Comments: Navajo Gene rating Station Final Rule | July 28, 2014 Regarding the comment that a 30 percent differe nce between the average cost-effectiveness of SNCR+LNB/SOFA and SCR+LNB/SOFA is substantial, EPA notes the average cost-effectiveness of SCR+LNB/SOFA at $2,240 per ton. Whether we consider the av erage cost-effectiveness of SCR+LNB/SOFA alone or in comparison to the av erage cost-effectiveness of SNCR+LNB/SOFA of $1,745 per ton, EPA’s determination that SCR is cost-effective at NGS does not change.



### 3.2 Other Comments on Factor One

Comment: Indirect costs should also be considered under Factor 1

The Gila River Indian Community (0039/0317) asserted that EPA c onducted the analysis of costeffectiveness incorrectly by excluding the indirect costs of the requirements and only considering the direct cost of the requirements. The commenter asserted that the indire ct costs are profound. The commenter stated that EPA briefly discussed, but did give serious cons ideration to the costs associated with indirect impacts of our proposed BART determination.

Response:

EPA disagrees with the asserti on that our cost-effectiveness anal ysis was incorrect because it did

not include indirect costs. The BART Guidelines, in the discussion titl ed “How do I estimate the costs of

controls?” focuses on the costs of the equipment and other capital and annual costs associated with the control technology alternatives, and specifically recommends use of the EPA Control Cost Manual in order to maintain and improve consistency, as the basis for equipment cost estimates. 78 The EPA Control Cost Manual does include “indirect” costs, but these are costs associ ated with non-equipment costs of construction of a given control technolo gy (e.g., engineering and proj ect services , or labor costs). Neither the EPA Control Co st Manual nor the BART Guidelines require consideration of the monetary value associated with indirect effects in the manner recommended by the commenter (i.e., the impact of higher electricity generation costs on CAP water rates and surplus NGS power sales that

contribute to the Lower Colorado River Basin De velopment Fund and tribal water settlement agreements). Therefore, EPA disagr ees that our analysis for Factor 1 was incorrect or incomplete

because it did not include indirect costs to tribes.

EPA further notes that under Factor 2, the energy and non-air quality impacts analysis, the BART Guidelines specifically require the energy imp act analysis to consider only direct energy impacts (e.g., parasitic load from certain control technologies) and to generally exclude indirect energy impacts of controls (e.g., energy to produce raw materials for construction of control equipment) unless the indirect impact is unusual or significant. We note that under Factor 2, EPA did consider indirect effects

of control alternatives to tribes and other entitie s in Arizona that rely on NGS for power, or CAP for water. EPA quantified the impact to electricity ra tes and CAP water rates, and also assessed whether installation of SCR would result in electricity genera tion costs at NGS that exceed the cost to purchase power on the wholesale market. Theref ore, although EPA appropr iately did not consider indirect costs to tribes in our analysis of Factor 1, EPA did include consideration of indirect impacts to tribes and other entities in our analysis of Factor 2.

78 See Final BART Guidelines at 70 FR39104 at 39166-7 (July 6, 2005).Page 45

EPA Responses to Comments: Navajo Gene rating Station Final Rule | July 28, 2014 

## 4.0 Comments on Factor 2 – Economic, Energy, and Non-Air Quality Environmental Impacts

4.1 Comments on Economic Impacts

4.1.1 General Comments on Economic Impacts

Comment: Comments on potential economic impacts

Numerous private individuals (0046, 0050, 0051, 0077, 0106, 0115, 0128, 0145, 0146, 0147, 0148, 0161, 0167, 0168, 0169, 0193, 0195, 0200, 0203, 0205, 0212, 0221, 0222, 0233, 0224, 0226, 0229, 0246, 0264.1, 0266, 0272, 0292, 0321, 0382), a public/private coal ition (0400), and an industry trade association (0278) fear that the imposition of “cost-prohibitive” emission controls would result in

the closure of NGS and its associated mine (i.e., Kayenta Mine), and ma ny stressed that the loss of jobs

as a result of these closures w ould be devastating to the Navajo Nation and Arizona’s economy. One commenter (0077) mentioned a study conducted by ASU that researched the economic impact of NGS, which revealed that the closure of the plant woul d shatter the Navajo Nation and Arizona’s economy. Other commenters (0233, 0292) noted that this study predicted that the plan t will give rise to nearly $20 billion in economic activity to Arizona and th e tribal communities over the next 30 years

. Four commenters (0229, 0233, 0266, 0292) noted that NGS and its associated mine collectively provide upwards of 1,000 jobs – most to members of the H opi Tribe and Navajo Nati on. One private individual (0284) stated that the unemployment rate for Native Americans in Arizona is 60 percent.

One private individual (0272) be lieves that the decline in prop erty values in and around Page, Arizona is largely due to resident s’ fear that NGS will shut down. In addition, two individuals (0138, 0321) noted that NGS is a large s upporter of school programs (e.g., sc holarships for colle ge), activities (e.g., basketball tournaments sponsor) in the area , and emphasized that without these financial contributions many of these programs and events w ould not be available to students. One of the commenters (0321) warned that th e closure of NGS would force ma ny families to move, which would have a ripple effect on the school system (e.g., reducti on in enrollment) and loca l business that rely on plant employees to buy their goods and services. Furt hermore, the commenter believes that the plant offers Native Americans the ability to bridge the ga p between the work world and the traditional Navajo world. A community healthcare provider (0018) st ated that closure of NGS could threaten the commenter’s ability to deliver care in the isolated communities the commenter serves because NGS is a strong partner in the community th rough its support of health outreach for the commenter and other social service agencies.

A number of commenters ( 0343, 0017/0289/0320, 0140, 0188, 0234, 0304, 0052, 0306, 0416), also described the economic importance of NGS and the Kayenta mine to the State of Arizona, the Navajo Nation, and the Hopi Tribe. The commenters typically noted that NGS and the mine provide many jobs to Native Americans, and the tribes recei ve significant revenues from payments associated with coal royalties, taxes, permits , lease fees, and scholarships. Accord ing to some of these commenters, mining activity has provided over 50 pe rcent of the Navajo Nation’s oper ating expenses in recent years and over 80 percent of the Hopi Tribe’s 2009 operati ng budget. Some of the commenters cited a 2012 ASU study that determined that NGS and the Kayent a Mine cumulatively will account for more than $679 million in adjusted state tax revenues from 2011 through 2044 and will provide 112,720 full-time equivalent job years in Arizona during that time pe riod, while indirectly benefiting local businesses.Page 46

EPA Responses to Comments: Navajo Gene rating Station Final Rule | July 28, 2014 One commenter (0142) noted some key points about NGS regard ing its economic significance including that the plant employs about 520 people a nd the Kayenta mine employs more than 400 people, of which 85 and 90 percent are Native American. Acco rding to the commenter, NGS closure, with the impact on Kayenta mine, would lead to a loss of clos e to 3,400 jobs and more th an $20 billion in lost

economic contributions from 2011 to 2044. The commen ter stated that EPA must consider these economic impacts the regulation will have one the Tr ibes and the State of Arizona, and the commenter said that closing NGS is not an option. In the comme nter’s opinion, EPA should give NGS time in order to address problems with plant emissions.

Another commenter (0223) expressed similar con cerns about the potential impact of EPA’s BART proposal and Alternative 1, stating that asso ciated costs will cripple existing Arizona businesses and completely deter others from participating. The commenter asserted that multi-billion dollar companies such as Lockheed Martin will not relocat e to Arizona if there are any uncertainties with regard to the availability of affordable energy and water in the desert. One commenter (0258) also expressed concern about the economi c impact of the increased costs for water and power in Arizona under EPA’s proposal, which the commenter believes w ould be a devastating bl ow to an economy that is just beginning to emerge from the recession.

The Navajo Nation (0024/0098/0316/0326) strongly opposes the BART proposal and stated that it could threaten the economy and livelihood of the Navajo Nation. The commenter indicated that it has previously communicated to EPA that if SCR is re quired within 5 years, the worst possible outcome

would be the shutdown of NGS. Should this be the case, the Na vajo Nation would lose around $1.02 billion (2013$) through 2044 in direct payments from NGS, plus additional millions in lost revenues from Kayenta Mine. These potential financial losses would be devastating to the Navajo Nation. On the other hand, if only one generator wo uld shut down, the Navajo Nation could incur a loss of close to $300 million between now and 2044, the commenter sa id. If LADWP and NV En ergy relinquish their ownership shares in NGS by 2019, which seems very li kely, the commenter said that NGS may have to shut down one 750 MW unit and apply SCR to the other units if the Navajo Nation also elects to not exercise the option of purchasing a portion of the NGS ownership sh ares. If this does not happen, the

commenter would have to use its limited funds and st aff time to identify suffici ent financial resources and support to use its right to acquire a portion of NGS. Due to various different variables, the

commenter said that it could lose this opportunity to purchase part of NGS. The commenter indicated that it does expect to see a loss of about $11 million annually as a result of closing one unit or through curtailment of energy production at NGS, but the co mmenter has committed to making sure the plant remains economically viable and the Navajo Nation continues to receive about $33 million in revenue

until 2044.

In addition to strongly opposing the BART proposal, the commenter (0316) also indicated that the Agency has failed to perform an ad equate 5-factor analysis, in partic ular as it relates to assessing the non-air quality impacts associated with coming into compliance. The commenter reiterated that despite previous communication from the co mmenter to EPA that may have been misleading in terms of the Navajo Nation’s position on the TWG Agreement, th e commenter repeated its strong support of the

TWG Alternative as a better alternative than the BART proposal and Alternative 1.

One private individual (0025) a sserted NGS does not benefit th e Navajo Nation as they are paying very little for the use of Navajo land. Th e commenter believes that, though workers are being paid, the only people benefiting are CAP, APS, TEP, SRP, NV Energy, and LADWP. The commenter stated that NGS has easily used 20 percent of the electricity for profit instead of going to the CAP project. The commenter (0025/0135) also stated that 0177-13 us ed the old ASU economic studyPage 47

EPA Responses to Comments: Navajo Gene rating Station Final Rule | July 28, 2014 (2/12/12) instead of the newer vers ion that quoted $30 billion that th e old ASU economic study said not to use on the Navajo Nation. 79

A council delegate for several ch apters of the Navajo Nation ( 0362) asserted that the Navajo Nation does not need NGS, indicating that in the first 25 years, the Nava jo Nation was given only $160,000 a year for the use of about 766 acres of land, and the second 25 years began with $608,400 a year until 2011 when half of what wa s paid to the State of Arizona in taxes was provided to the Navajo

Nation. The commenter concluded that the benefit to the Navajo Nation is now only about $3 million a year until 2020 and that the Navajo Nation does not critically need the NGS revenue.

Response:

Although there may be some disagreement by othe rs about the relative importance of NGS to the Navajo Nation (contrasting comments from e.g., 0362 and 0316), EPA recognizes that NGS and the Kayenta Mine contribute economically to the Navajo Nation, the Hopi Tribe, tribes and communities that use CAP water, and other communities in Arizona , such as the city of Page. In our Proposed Rule, we recognized that the concerns expressed by numerous commenters on the ANPR was that a stringent

BART determination would force NGS to close. In our Proposed Rule, under Factor 2, we included an analysis that showed that the installation of SCR on all three units by 2018 woul d not cause the cost of electricity generation at NGS to exceed the cost to purchase wholesale power on the open market. In other words, our analysis shows that it would be more economical for NGS to install SCR and continue operating than it would be to close and purchase power on the wholesale market. As described in responses to other comments on EPA’s Affordability Analysis, EPA has updated the analysis and the

results still show that our fina l BART determination requiring compliance with an emission limit

achievable with SCR in 2019 would not cause the cost of electricity generation at NGS to exceed the cost to purchase wholesale power on the open market. This analysis and supporting documents were in our docket for our proposal. Comments related to othe r aspects of our five-fact or analysis and the TWG Agreement are discussed elsewhere in this responses to comments document.

Comment: Contribution of Class I area s to local and state economy

Several individuals (0091, 0181, 0240, 0264.8, 0288, 0327, 0360, 0366, 0388, 0405, 0432) support additional controls on NGS because they believe that visibility at na tional parks and wilderness areas is important to safeguard tourism and the economic vitality of Ar izona, local and tribal communities, and nearby states.

One environmental advocacy group (0373) stated that rigorously addressing visibility-impairing pollutants will have a positive impact on U.S. national parks and wilderness areas, which are of great

natural and cultural value and are also engines for sustainable local capital. The commenter indicated that in 2008, National Park Service units rece ived over 274 million visits accounting for over $2.5 billion in revenue. Quoting an exhibit submitted with the comments, the commenter stated that national parks support $13.3 billion in local private-sector economic activity and 267,000 private-sector jobs;

79 The commenter attached to Comment 0 135 a proposed Navajo Nation Council resolution with tracking number 0177-13, the subject of which is the renewal of NG S’s lease. Attached to the resolution is the ASU economic study dated February 12, 2012, which addresses the economic impact of NGS and Kayenta mine on the State of Arizona. In Comment 0025 the commenter presented quotes from this ASU report indicating that additional study would be needed to quantify the economic impact on the Navajo Nation. Such a study was subsequently carried out by ASU with findings published in an April 2013

report.Page 48

EPA Responses to Comments: Navajo Gene rating Station Final Rule | July 28, 2014 attract businesses and individuals to the local area, resulting in economic growth in areas near parks that is an average of 1 percent per year greater than stat ewide rates over the past th ree decades; and generate more than four dollars in value to the public for ev ery tax dollar invested. The commenter asserted that tourism is a critical component of the economies of Arizona, Utah, and the Southwestern United States, giving the example that, in 2010, Grand Canyon Nati onal Park generated over 4.3 million recreation visits, in excess of $428 million in local spending, and more than 6,100 jobs (citing an exhibit submitted with the comments).

One public interest advocacy group (0404) repr esenting the Taxpayer Association of Kane County, Utah, stated the largest econo mic source in the county is touris m. Tourists come to the area to visit Lake Powell and the Grand Canyon. However, the commenter asserts that the polluted air stemming from NGS has a negative impact on the t ourism industry where the haze from NGS often covers the sky preventing people fr om viewing the beautiful vistas.

Response:

EPA agrees that National Parks and Wilder ness Areas are important natural and cultural

resources that contribute to tourism and economic vitality in the southwestern United States. Generally consistent with information provided by the commen ters, in our Proposed Rule, we noted that the 11 Class I areas located within 300 km of NGS suppor t an active tourism industry drawing over 4 million visitors to the Grand Canyon National Parks alone in 2011. 80

Comment: Give more consideration to economic impact of SCR

Many private individuals (0026, 0036, 0042, 0044, 0045, 0046, 0048, 0050, 0051, 0053, 0054, 0069, 0070, 0075, 0077,0078, 0079, 0081, 0086, 0088, 0099, 0109, 0115, 0117, 0119, 0128, 0132, 0133, 0145, 0146, 0147, 0148, 0160, 0161, 0163, 0165, 0167, 0168, 0170, 0193, 0200, 0203, 0205, 0208, 0212, 0221, 0226, 0232, 0233, 0266, 0298, 0307, 0329, 0330, 0335, 0346, 0358, 0437), a government commenter (0406), and a public/private coalition (0400) urged EPA to give more consideration to the economic impacts, especially increa ses in water and energy rates, that this rule will have on Arizona residents (i.e., users of CAP water, and agriculture a nd tribal communities), in addition to its impact on water policy in Arizona. One commenter (0221) indicated that the cost of installing SCR at NGS would increase the price of power by 0.39 to 0.48 cents per kilowatt-hour, and potentially raise water rates for CAP users as much as 13 to 16 percent. Another co mmenter (0088) suggested th at the NPS increase its fees to pay for costs of controls, since regional haze rules are intended to improve visibility at parks, instead of requiring energy rates to increase for roughly 6 million Arizonans. One private individual (0212) stated that rate increas es would negatively impact people living on fixed incomes.

Numerous private individuals (0046, 0086, 0088, 0145, 0146, 0147, 0148, 0161, 0163, 0165, 0167, 0168, 0193, 0200, 0203, 0205, 0212, 0221, 0226, 0233, 0266, 0298, 0307, 0437), government commenters (0324, 0406, 0443), a public/private coaliti on (0400), and an indus try trade association (0278) emphasized that NGS is responsible for suppl ying about 90 percent of the power used by CAP to pump water from the Colorado River across Arizona. One commenter (0307) stated that the plant sells its excess power to help defray the repayments to the federal government fo r the construction of the CAP system, and argued that EPA’ s proposed rule would hinder th e selling of this power; thus, increasing the financial burden of the plant and Arizonans. One of th ese commenters (0046), along with

80 See Proposed Rule 78 FR at 8275 (February 5, 2013) and footnote 1.Page 49

EPA Responses to Comments: Navajo Gene rating Station Final Rule | July 28, 2014 another private individual (0069), su ggested that CAP has the opportunity to research alternative fuel sources, so that it can conti nue to supply Arizonans with re liable and affordable water.

One commenter (0087) expressed concern about water rate incr eases as a result of the rulemaking. The commenter referred to the water settlement agreement between the U.S. and the Gila River Indian Community in 2004. The commenter stated that agreement entitle d the Community to over 300,000 acre-feet of water from CAP. In addition, the commenter st ated that the agreement also committed substantial funds from the U.S. towards constructing and repairing irrigation infrastructure in order for the Community to use its CAP allocation. Th e commenter asserted that if EPA moves forward with the proposal it could make the investment useless by making the water too expensive for the Community to purchase. Other tribes with similar CAP allocations could also be negatively impacted because of the higher cost of water and also because tr ibal subsidies set aside to offset those costs would run out faster. Some commenters noted that not only will Native American communities be affected, but non-Indian communities, like farmers, will also be im pacted by the regulation, and will be forced to use more groundwater. The commenter asserted that in so me cases, it is possible th at groundwater pumping will double, and counteract decades of sustainable water policy, the commenter said. Furthermore, families struggling to get back on their feet would also be negatively affected by the increase in water

rates.

One private individual (0115) hi ghlighted that Arizonans live in the desert and low water rates are essential for maintaining an overall quality of life, particularly for fa rmers and manufacturers. Similarly, one private individual (01 17) argued that an increase in wa ter rates would limit the financial resources that local businesses and utility companie s have available to hire more employees. This commenter (0117) and another privat e individual (0168) warned that co mpanies looking to relocate may look past Arizona for a state with an environment mo re conducive to businesses. In contrast, one private individual (0264.7) argued that pr ime agriculture land in Arizona ha s vanished over time due to urban sprawl and the desire for low water and electricity rates.

Six private individuals (0038, 0040, 0083, 0177, 0204, 0388) are willing to pay higher energy

costs for a healthier envir onment. One of these commenters (0083) st ated that NGS is not obligated to produce cheap power and suggested that they charge a rate that will pa y for the true operating costs of producing the electricity, thus allowing the plant to stay in operation.

One public/private coalition (0381) in Pinal Co unty, Arizona, expressed significant concern that the cost of SCR would represent a tremendous ec onomic burden. The commenter asserted that Pinal County is the fastest growing count y in Arizona, contains a significan t amount of irrigate farmland and relies heavily on CAP. Therefore, commenter concl udes that the cost implic ations of requiring SCR would hinder economic recovery and future developm ent in Arizona and Pinal County. This sentiment was echoed by other comments, including comments fr om chamber of commerce representatives (0140, 0188, 0234, 0304), an industry/commerce trade associa tion (0084), two CAP wa ter distributors (0194, 0214), two associations of CAP wa ter distributors (0252, 0398), and a consultant (0262), who expressed concern that EPA’s proposed rule would place a tremendous economic burden on energy and water users in Arizona. For example, one commenter (0234) noted that Flagstaff’s to tal cost of living is currently 15.6 percent above the national average, based on a cost of living index st udy prepared on a quarterly basis by the Greater Flag staff Chamber, and 56.7 percent above the national average for the cost of housing, which they believ e would worsen if NGS shuts dow n. Another commenter (0282) noted that many small businesses (i.e., mom-and-pop shops) depend on affordable energy and water rates and warned that these businesses may not be able to su rvive if these rates incr eased. One commenter (0304) claimed that EPA’s proposed rules would increase ra tes by 20 percent or more. The industry/commercePage 50

EPA Responses to Comments: Navajo Gene rating Station Final Rule | July 28, 2014 trade association (0084) indicated that water rates could double or triple, which will prevent small businesses from hiring and reduce the disposable income of cons umers, further harming small

businesses.

The association of CAP water distributors (0398) stated that EPA discounted the economic consequences that will arise if NGS is forced to shut down due to regulatory co sts and failed to properly

assess the harm a shutdown would cau se to the state. This commenter urged EPA to address what the

commenter believes are incontrovertible economic impacts to central Arizona, central Arizona agriculture, and the Navajo and Hopi tribes.

Several local government commenters (0175, 0189, 0201, 0207, 0213, 0263, 0293, 0295), although supportive of clean energy in itiatives, said the cost of installing and operating SCR would place a tremendous economic burden on energy users in the State of Arizona, and specifically on CAP users and could jeopardize the co ntinued operation of NG S. One local government commenter (0220) said that costly additional controls to NGS should not be mandated by EPA at the expense of Arizona ratepayers. A number of Arizona local government commenters emphasized how in the recent years, many cities have faced severe economic challenges.

One individual (0025/0125) asse rted that although SRP says it cannot afford SCR, it just invested $371 million in the Mesquite Power in Arli ngton, Arizona, and is deliberately violating federal law by not installing the SCR. The commenter also urged EPA not to allow NGS 10 years to install

SCR.

One individual (0091) stated th at although EPA’s cost analysis shows that the installation of

SCR at NGS would increase the cost of electricity genera tion by 16 percent, the commenter believes that this is less costly than purchasing electricity on th e wholesale market from elsewhere in the West, and suggested that NGS explore alternativ e energy sources, such as wind and sola r to offset this rise in cost.

Several representatives of the Ariz ona state legislature (0082, 0085, 0087, 0095, 0097, 0104, 0105) voiced concern over regulating NGS, which they believe will have devasta ting effects on the State

of Arizona. Some of the commenters said that NGS is a vital component of the state, which provides affordable energy to CAP, which in turn provides affordable water to 80 percent of the population of

Arizona. The commenters assert th at requiring controls on NGS could cost as much as $1.1 billion and could cause the plant to shut down. Some of the commenters referred to the ASU report, which indicated that the regulation could cause a lo ss of 3,400 jobs per year and close to $20 billion in lost economic activity over the next three decades. One commenter (0105) said that it has reviewed the reports available on the expected benefits from the regulation in terms of decreasing NO x emissions and reduce haze over the Grand Canyon and said that it questions the projections and analysis stating that there is a lack of evidence that the regulation will have noticea ble results. Other commenters also said that it is questionable whether NGS is responsible for per ceptible haze above the Grand Canyon. Some of the commenters referred to the NREL report which did not conclusively indicate that additional controls would lead to improved perceptible visibility. One commenter (0085) was perplexed why EPA would require such costly controls on a pl ant so important to the livelihood of the State of Arizona without firm evidence that controls are guaranteed to improve visi bility. One commenter (0087) stated that regardless of the actual visibility improvements that would be achieved, all parties agree that costs would increase substantially. In general, the commenters assert becau se NGS is vital to the State of Arizona and closure of the plant would impact the well-being of the st ate, commenters urged EPA to abandon the proposed rule and conduct a thorough analysis that considers th e indirect economic impli cations of the regulation.Page 51

EPA Responses to Comments: Navajo Gene rating Station Final Rule | July 28, 2014 Response:

EPA recognizes that NGS and the Kayenta Mine contribute economically to the Navajo Nation, the Hopi Tribe, tribes and communities that use CAP water, and other communities in Arizona, such as the city of Page. As mentioned above, in our Pro posed Rule, we recognized the concerns expressed by numerous commenters on the ANPR that a stringent BA RT determination would force NGS to close. In our Proposed Rule, under Factor 2, we included an anal ysis that showed that the installation of SCR on all three units by 2018 would not cause the cost of el ectricity generation at NGS to exceed the cost to purchase wholesale power on the open market. In other words, our analysis show s that it would be more economical for NGS to install SCR and continue opera ting than it would be to close and purchase power on the wholesale market. As described in response s to other comments on the affordability analysis, EPA has updated the analysis and th e results still show that our fi nal BART determination requiring compliance with an emission limit achievable with S CR in 2019 would not cause the cost of electricity generation at NGS to exceed the cost to purchase wholesale power on the open market.

In our Proposed Rule, EPA also calculated and c onsidered the cost increases associated with SCR on SRP electricity rates and CAP water rates. We projected an electricity rate increase to SRP customers of 0.66 percent, a water ra te increase to CAP mu nicipal and industrial (M&I) customers of 6 percent, and a water rate increase to tribal and agricultur al water users of 14 pe rcent. Alt hough the actual amount of the rate increase of $8.40 per acre-foot was projected to be the same for all users (i.e., M&I, tribal, and agricultural), the percent increase was hi gher for tribal and agricultural water users because these users pay less for water than M&I users. 81 As stated in our Proposed Rule, EPA recognizes that

water rate increases are critical issues to ma ny stakeholders, including nu merous tribes, and EPA considers the potential economic im pacts to argue for flexibility in the compliance timeframe for NGS. 82

Comments related to other aspects of our five-fac tor analysis, including co nsideration of indirect costs, and anticipated visibility be nefits, as well as the TWG Agreemen t, are discussed elsewhere in this response to comments document.

Comment: Impact to the Lower Colorado Basin Development Fund

One commenter (0348) stated that the increased cost of production (with the SCR capital cost included) would result in less comp etitive wholesale sales from surp lus generation at NGS – revenue

that flows into the Lower Colorado River Basin Development Fund (LCRBDF, or Development Fund).

The commenter noted that CAP offi cials have estimated that the f und would be at risk of losing approximately $175 million over the 2016-2036 timefram e, and $1.2 million per year, thereafter.

Another commenter (0384) stated that the incr easing cost of production at NGS resulting from substantial SCR capital investment will likely have a negative impact on the Development Fund..The

commenter asserted that increased cost will result in the need to raise NGS prices, thus lessening its competitiveness in the wholesale power market and that as less NGS surplus is sold due to its competitive disadvantage, less revenue flows into th e Development Fund. The commenter stated that the annual loss to the Fund would be approximately $6.6 million with a NPV of over $82 million over a 25- year time horizon.

81 See Proposed Rule at 78 FR at 8283 and Table 6 (February 5, 2013).

82 Id. at 8284.Page 52

EPA Responses to Comments: Navajo Gene rating Station Final Rule | July 28, 2014 Response:

As discussed briefly in our Proposal Rule and in more detail in the TSD to our Proposed Rule, EPA recognizes that any electricit y owned by Reclamation based on is 24.3 percent pa rticipation in NGS that is not used by CAP is sold and re venues are deposited into the Development Fund. 83 This fund is authorized to pay the delivery portion of the cost of CAP water for certain Indi an tribes and to pay the cost of constructing delivery systems to bring CAP water to certain Indian tribes. 84 EPA considers the potential economic impacts to the Development Fund, in addition to other potential economic impacts to tribes, to argue for providing flexibility in the compliance timeframe for NGS.

Comment: Impact to tribal agricul ture is overstated

One private individual (0158) a sserted that the Gila River I ndian Community employs only two agricultural workers and that most of the Gila Ri ver farmland is not being used. The commenter added

that the Salt River Indian Commun ity does not employ any agricultural workers and that the Salt River Indian Community does not have a water crisis . The commenter asserted the Ak-Chin Indian Community employs five agricultura l workers and that Ak-Chin is converting farmland for other uses (e.g., for its casino and resort). The commenter concl uded that these tribes would not be economically impacted if SCR and baghous es are installed at NGS.

Response:

Although the commenter asserts that the importance of farming and agriculture to several tribes may have been overstated, EPA notes that regardless of the level of farming, the Gila River Indian Community, the Salt River Indian Community, and th e Ak-Chin Indian Community all have allocations of CAP water through settlement agreements that were approved as acts of Congress, and that potential increases in CAP water rates are important economic considerations to these tribes.

Comment: Economic impact on Arizona mining industry

One industry trade association (0306) indicated that the mini ng industry in Arizona would be particularly hard hit by the BART proposal because it is an energy-intensive industry and a significant

water user. The commenter noted that the Ariz ona copper industry empl oyed about 12,100 people and

had an estimated direct and indi rect impact on the Arizona economy of nearly $5 billion in 2012. The

commenter believes that the increased electric and wa ter costs associated with the proposed BART, and particularly with NGS closure, w ould adversely affect the mining i ndustry and the Arizona economy as

a whole.

The commenter (0306) stated that many of its member companies rely both on NGS electricity and CAP water, so increased water and electric ra tes would create a cumulati ve effect and adversely affect profitability. The commenter indicated that because its mini ng company members operate in a global market which determines the prices for their products, they ca nnot pass increased electricity and water costs on to their customers. According to th e commenter, such price increases threaten the competitiveness of these companies on the global market.

83 See Proposed Rule at 78 FR at 8282 (February 5, 2013) and TSD at pages 71-72.

84 See Proposed Rule at 78 FR at 8283 (February 5, 2013).Page 53

EPA Responses to Comments: Navajo Gene rating Station Final Rule | July 28, 2014 Response:

EPA did not specifically consid er the potential economic impact s to the mining industry in Arizona in our Proposed Rule. Although we do not interpret the BART Guidelines to require

consideration of indirect cost s and impacts of controls, we re cognize and acknowledge that other stakeholders may be affected by this rulemaking in addition to tribes and othe r groups discussed in our proposed rules. As stated elsewhere, EPA considers the pote ntial economic impacts to tribes to argue for flexibility in the compliance timeframe for NGS. Th is flexibility also bene fits other stakeholders, including the mining industry in Arizona.

Comment: Specific Impacts to Tucson Electric Power (TEP)

One of the owners of NGS (0314) stated that it s share of installing SCR on all three NGS units would cost $49 million, which could double if perm itting requires baghouses to reduce particulate

emissions. The commenter indicated that it is also an owner participant in FCPP (7 percent of Units 4 and 5) and SJGS (50 percent of Units 1 and 2), for which EPA has already finalized BART determinations requiring in stallation of SCR, so that the comm enter is potentially facing about $320 million in capital expenses over the next 5 year s based on the conventional regulatory compliance

schedule. The commenter believes that these costs w ould result in significantly higher electricity costs for its customers (a rate impact approaching a 4 per cent increase) at a time wh en Tucson is struggling to recover from the economic stagnation of the rece nt recession, placing an economic hardship on the customers and making recovery more difficult. The co mmenter further noted that most of its customers are also customers of Tucson Water, which relies on CAP for over 75 percent of its water, and CAP has

estimated that SCR at NGS could result in an increase in water rates of 33 percent.

Response:

EPA recognizes that Tucson Electri c Power is a participant in othe r coal-fired power plants in

the southwestern United States th at are subject to BART . EPA notes that our BART determination does not require installation of baghouses and that in our Proposed Rule we estimated a six percent increase

in water rates from SCR installa tion at NGS for industrial customer s (assuming 100 percent reliance on CAP water). As stated elsewhere, EPA considers th e potential economic impacts to tribes to argue for flexibility in the compliance timeframe for NGS. Th is flexibility also bene fits other stakeholders, including the customers of Tucson Electric Power and Tucson Water.

Comment: Installation of pollution controls creates jobs

One environmental advocacy group (0373) stated requiring installation of pollution control technologies creates jobs, noting that each installati on creates short-term cons truction jobs as well as permanent operations and management positions (c iting an exhibit submitt ed with the comments).

Response:

EPA agrees that jobs will likely be associated with construction and in stallation of air pollution control technologies.Page 54

EPA Responses to Comments: Navajo Gene rating Station Final Rule | July 28, 2014 Comment: Requiring SCR may force NGS to close

One commenter (0348), the operator and co-owner of NGS, stated that should EPA require SCR on all units, its decision will put at risk the future vi ability of the NGS units and threaten the delivered

cost of water to CAP users since substitute and more costly power would be necessary to replace lost NGS power. The commenter (0348) di sagreed with EPA’s assertion that should a BART determination require SCR, NGS would not shut down since the co st of market replacement power would be more expensive than the increase d cost of production at the generating stat ion. In the case of NGS closure, the commenter stated that the effective replacement substi tute would be a new base load power plant, most likely gas-fired. The commenter sugge sted that EPA had relied on foreca sted short-term (spot market) values in its comparison of substitute cost of NGS generated power. Thus, the commenter asserted that the more relevant cost comparison is that of a newly built power station and, thus, accordingly, the analysis of short-term market values as undert aken by EPA presented a skewed cost comparison

outcome.

The commenter (0348) noted the complexity of decision making at NGS because it has multiple owners, each with its own specific co st structure and factors that filt er into its decision-making. The commenter asserted that EPA failed to acknowledge orrecognize these diverse and complicating factor in arriving at any ‘consensus’ at to new and substantial capital investment at NGS. The commenter also asserted that the pending depa rture of LADWP and NV Energy (in 2019) was another factor in how decisions to meet required upgrades will be difficu lt to reach in a timely manner. The commenter claimed that, in addition to the complexities arisin g from multiple ownership, there exist considerable uncertainties regarding additional factors that will a ffect the plant’s operation and future cost and that items such as pending lease negotiations with the Navajo Nation, rights-of-way agreements, and other such factors make the timing of an SCR mandate critically important.

The commenter (0348) added that the Bureau of Indian Affairs must also approve the amended

lease but cannot do so until all Federal actions have b een completed and that the required Federal review process will necessitate the coordination of 10 or mo re Federal agencies and 15 Native American Tribes. The commenter stated that only afte r these actions are completed will a Record of Decision (ROD) be issued and the Secretary of the In terior approval obtained, adding that the ROD is subject to litigation should any party of interest challenge the findings. The commenter asserted that before any NGS owner agrees to invest in environmental upgrades, all this will need to be resolved. Because of the complexities and number of parties involved, the commenter stated that a BART finding requiring SCR before the 2024-26 timeframe is likely to result in NGS partic ipants unwilling to invest since the likelihood of closure on the uncertainties is unlikely.

Another owner of NGS (0314) stat ed the February 2013 Proposal pr esents signifi cant challenges and risks with regard to the commenter’s resour ce planning by handicapping its ability to costeffectively respond to changing conditions. The commente r noted that some of these uncertainties have the potential to change the economic viability of its generating resources, such as the impacts of potential future regulations, future fuel prices, and customer load growth/d ecline (accounting for energy efficiency and distributed generation). The commen ter indicated that implementation of the BART proposal would require the NGS owne rs to decide between making a significant capital investment in the plant or allowing the plant to close by 2019; if the NGS owners elec ted to install c ontrols to meet BART, recovering that cost coul d only be achieved through long-te rm operation of NGS which would have the effect of locking NGS into the commenter’s generation portfolio for a considerable period ofPage 55

EPA Responses to Comments: Navajo Gene rating Station Final Rule | July 28, 2014 time or risking stranding those investments. Accordi ng to the commenter, this loss of flexibility would hamper the commenter’s ability to res pond to the following future scenarios:

 Changes in the economic viability of coal resour ces due to the increasing costs of environmental regulations, including carbon limits.

 Changes in acceptance of coal reso urces by state utility commissions.

 Low, sustained natural gas prices, which w ould favor natural gas resources over coal.

 Reduced demand for coal resources due to increa ses in renewable genera tion capacity and/or

reductions in customer load use to ener gy efficiency and demand response programs.

The commenter (0314) stated that the more likely alternative is that the NGS owners could decide that a

substantial investment in NGS canno t be justified given current regula tory uncertainties related to the lease and rights of way renewals. The commenter noted th at NGS is just one of its coal-fired assets that, according to the commenter, are currently facing the risk of premature retirement. The commenter indicated that it has already proposed to reduce its reliance on coal by over 30 percent and an additional 30 percent is at risk of premature retirement. The co mmenter believes that replacing this level of base load generation over a relatively short period w ill require a significant capital investment, with correspondingly significant impact on customer rates.

The commenter (0314) asserted that this loss of flexibility and a ssociated risk to the commenter and its customers is unnecessary given that the re gional haze program is intended to make gradual reductions in emissions over a decades-long period. The commenter believes that EPA should recognize

the NO x reductions already made at NGS as BART, then further reduc tions could be made at the plant (including possibly SCR) over subse quent planning periods. The commenter indicated that this approach

would have the benefits of reduci ng the immediate financial burden on its customers, allowing time for greater certainty in terms of potential carbon limits and customer demand, and retaining greater flexibility in future resource decisions.

Response:

EPA has provided responses to specific comment s on the Affordability Analysis in section 4.1.2 of this response to comments document. EPA disagr ees that we failed to acknowledge and consider the complexities in reaching a consensus between the owne rs in making new capital investments at NGS. In our Proposed Rule, EPA outlined the uncertainties that significantly increase the financial risk of nearterm investments in new air pollu tion controls, including uncertainties in plant ownership and lease

agreements. 85 EPA also highlighted the importance of continued operation of NGS and the Kayenta Mine to the Navajo Nation and Hopi Tribe as well as the importance of Reclamation’s share of NGS to supply water to many tribes located in Arizona in accordance with several wate r settlement acts. Based on the existing uncertainties and th e importance of NGS to tribes, EPA proposed to determine that compliance flexibility is necessary or appropriate and put forth a framework for providing additional flexibility in the compliance timeframe for alternatives to BART. EPA recognized the NO x reductions already made at NGS as a credit for the early and voluntary installation of LN B/SOFA in the framework

for BART Alternatives.

Comment: Closure of NGS will raise water costs for all water users, cause economic harm, and threaten administration of wate r rights defined by the AWSA

85 See Proposed Rule at 78 FR at 8278 (F ebruary 5, 2013) and references therein.Page 56

EPA Responses to Comments: Navajo Gene rating Station Final Rule | July 28, 2014 One public sector commenter (0343) stated that the shutdown of NGS, as a result of a requirement to install SCR, would more than doubl e the current CAP energy rate, the impact of which would fall disproportionately on trib al and non-tribal agricultural users, but also significantly on municipal and industrial users. The commenter stated that demand for CAP wate r is elastic especially for Indian and non-Indian agriculture. In response to large increases in water cost, the commenter asserted that agricultural users with in CAP’s service territo ry would turn to the less-expensive option of pumping groundwater, and that those without sufficient groundwater pu mping capacity would be forced to take their land out of production.

Several tribal governments (0039/0317, 0419) simila rly expressed in its comments that Indian tribes are disproportionately impacted by this regu lation due to the social and economic conditions of the Indian population. Because Indian tribes receive water from CAP, they are affected by the increase in water prices and also affected via the Deve lopment Fund. The commenter expressed that EPA does not believe power prices will increase above current levels and therefore not impact the Development Fund. However, the commenter does not agree with EPA and argued that the Development Fund would suffer from the regulation. The commenter asserts that choosing either of the al ternatives presented in the February 2013 Proposal as BART w ould restrict or remove the Commu nity’s right to receive and use water guaranteed by AWSA, make it difficult or im possible to pay for CAP and interfere with the crucial Development Fund revenue stream. One co mmenter (0419) discussed the history of water contracts, details on the entitlement of water from the Colorado River, and other agreements relating to tribal water rights. The commenter stated that th e U.S. has an obligation to prevent regulatory requirements that would interfere wi th the Tribes’ contractual rights to CAP water, funding for tribal infrastructure and water developm ent, and funding assistance from NGS revenue and the Development

Fund.

The public sector commenter (0343) also stated that the impact on municipal and industrial customers would be significant a nd, although these users already pay a high cost for CAP water, the percentage increase would be less th an that experienced by agricultural users. The commenter believes that in order to fund the higher power costs that would result if NGS were closed, municipal and industrial users would be required to make new capital payments th at were previously supported by sales of excess NGS power when power market c onditions permitted. The commenter referred to the NREL study, which the commenter quoted as indicating that a $29 per ac re-foot incremental charge for CAP repayment would accrue to muni cipal and industrial users in the event that NGS were to close.

Response:

In our Proposed Rule, we recognized that th e concerns expressed by numerous commenters on the ANPR was that a stringent BART determination would force NGS to close. In our Proposed Rule, under Factor 2, we included an analysis that showed that the installation of SCR on all three units by

2018 would not cause the cost of elec tricity generation at NGS to exceed the cost to purchase wholesale power on the open market. In other words, our analys is shows that it would be more economical for NGS to install SCR and continue operating than it would be to close and purchase power on the wholesale market. As described in responses to ot her comments on the affordability analysis, EPA has updated the analysis and th e results still show that our final BA RT determination requiring compliance

with an emission limit achievable with SCR in 2019 w ould not cause the cost of electricity generation at NGS to exceed the cost to purchase wholesale power on the open market.Page 57

EPA Responses to Comments: Navajo Gene rating Station Final Rule | July 28, 2014 In our Proposed Rule, EPA also calculated and c onsidered the cost increases associated with SCR on SRP electricity rates and CAP water rates. We projected an electricity rate increase to SRP customers of 0.66 percent, a water ra te increase to CAP mu nicipal and industrial (M&I) customers of 6 percent, and a water rate increase to tribal and agricultur al water users of 14 pe rcent. Alt hough the actual amount of the rate increase of $8.40 per acre-foot was projected to be the same for all users (i.e., M&I, tribal, and agricultural), the percent increase was hi gher for tribal and agricultural water users because these users pay less for water than M&I users. 86

As discussed briefly in our Proposal Rule and in more detail in the TSD to our Proposed Rule, EPA recognizes that any electricit y owned by Reclamation based on it s 24.3 percent pa rticipation in NGS that is not used by CAP is sold and re venues are deposited into the Development Fund. 87 This fund is authorized to pay the delivery portion of the cost of CAP water for certain Indi an tribes and to pay the cost of constructing delivery systems to bring CAP water to certain Indian tribes. 88 EPA considers the potential economic impacts to the Development Fund, in addition to other potential economic impacts to tribes, to argue for thoughtful consideration of how fl exibility can be provided consistent with the air quality goals of the CAA.

Comment: EPA should evaluate cumula tive economic impact of other rulemakings

One commenter (0306) asserted th at the BART proposal must take into account the context in which the regional haze rules are being implemented. The commenter noted that the two remaining copper smelters in Arizona are already subject to BART for SO 2 and they also have to make significant capital investments to comply with other regulato ry programs and initiatives such as the revised SO 2 NAAQS. The commenter believes that as part of a proper cumulative imp act analysis, EPA should consider the existing regulatory co st burden as aggravated by the addi tional water and electricity costs for mining, beneficiation, and mineral processing facilities; that is, the total cost impact of EPA’s regulatory initiatives that must be considered.

Response:

EPA disagrees with the assertion that we must consider the total cost impact of all EPA regulatory requirements in a BART analysis. EPA recognizes that ot her facilities, whose water and electricity rates may be affected by our BART determ ination for NGS, may also be subject to BART for their own emissions of visibility-i mpairing pollutants. However, we note that BART is a case-by-case determination that is based on a source-specific analys is of five factors, as required under the CAA. The BART Guidelines do not require consideration of th e context in which BART determination is made, i.e., it does not require considera tion of indirect impacts or cumulativ e impacts of other rulemakings.



### 4.1.2 Comments on the EPA’ s Affordability Analysis

Comment: EPA incorrectly assumes that NGS will not close because power supplies are always available from the wholesale power market

86 See Proposed Rule at 78 FR at 8283 and Table 6 (February 5, 2013).

87 See Proposed Rule at 78 FR at 8282 (February 5, 2013) and TSD at pages 71-72.

88 See Proposed Rule at 78 FR at 8283 (February 5, 2013).Page 58

EPA Responses to Comments: Navajo Gene rating Station Final Rule | July 28, 2014 The Gila River Indian Community (0039/0317) asse rted that EPA made the incorrect assumption that wholesale power, sufficient in volume to replace NGS output if NGS were to shut down, will always be available. The commenter stated that it would be imprudent for utilities to rely on the availability and price of power in the wholesale market for normal base load and even peak energy demands. In addition, the commenter believes that el ectric utilities in Arizona would face significant scrutiny by state utility regulators an d their ratepayers if such a “risky” supply strategy were employed.

The commenter added that EPA has not considered a number of factors in assuming that NGS will not close. The White Mountain Apache Tr ibe (0440) also commented that it disputes the reliability of the power market pricing projections and recomm ended a more thorough analysis was needed.

Response:

EPA disagrees with the assertion that it was inap propriate to assume that sufficient wholesale power would be available to replace NGS’s output if NGS were to close. NREL addressed the question of sufficiency of wholesale power to replace the power generated at NGS. 89 NREL used a production cost model to analyze power flows from western generators; the model tested the power supply and marginal prices (LMP) in the western system under two scenarios: with NGS operating (the base case) and with NGS closed. The modeling results allowed not only insight as to whether there was enough surplus power in the western grid to replace NGS power in the event of a closure, but also from where such power would be likely obtained. With regard to the availability of excess power, NREL’s analysis indicated that there was sufficient excess power in the western grid to ade quately replace lost NGS production. The base case model indicated that on average, NGS produces approximately 17.5 TWh annually. This is the volume of power that would need to be replaced should NGS close. The utilities that are participants in NGS (not including the Bur eau of Reclamation) all have portfolios of other power plants from which they can call upon for the production of the replacement power. 90 The NREL

model results indicated the utilities would need to replace, beyond the new power generated at their other power plants, roughly 7.7 TWh of generation. Additionally, the BOR share would need to be replaced in whole. Thus, NREL’s anal ysis indicated that of the 17.5 TWh of total power lost in a closure scenario, approximately 12 TWh woul d need to be replaced, and determ ined that there was sufficient surplus power in the western grid to replace those 12 TWh.

The NREL model analyzed where this remain ing amount of replacement power would be obtained. NREL determined that most of this replacem ent power would originate either in the Desert Southwest or California (in most cases, power for the NGS participa ting utilities was either from increased production of their own plants or from redirecting excess power from such plants from

California to their own southwest load). 91 For utilities located in Ca lifornia (and to some extent elsewhere where seasonal trades are common), increas ed production from with in each utility’s own region (Balancing Authority) was determined as like ly. Therefore, the NREL model demonstrated that not all generation from NGS would need to be re placed (roughly two-thirds would be) and for the amount that would need to be replaced (estimated at 12 TWh), power was available primarily in the

Desert Southwest and California.

With regard to the comment (0440) concerning the reliability of power ma rket price projections, the EPA study used, as a basis for its long-term (post-2016) forecasted prices, the most current projections of the Energy Information Administrati on (EIA). The EIA forecasts are developed for both a national and regional context. In th e case of their application in th e EPA Affordability Analysis, the

89 NREL report, p. 32.

90 See NREL report, Table 2-2, p. 33.

91 NREL report, pp. 32-35.Page 59

EPA Responses to Comments: Navajo Gene rating Station Final Rule | July 28, 2014 forecast employed was specific to power prices in th e southwest region of the nation. For more nearterm prices (current prices out to 2016), we used actual Palo Verde forward i ndex prices. These reflected current market conditions at that time and market expe ctations of the power indus try for power priced at the Palo Verde Hub, the primary pricing hub for electr icity in the southwest re gion. In order to capture any significant change in future price projections, EPA updated both the Palo Verde forward market prices and the EIA forecast for long-term sout hwest power prices on March 7, 2014. The updated Palo Verde forward price projection used in the revised Affordability Analysis is shown in the following graph (Figure 1). The results of this update, as well as other updates to the Affordability Analysis, are discussed elsewhere in this response to comments document. Because our analysis relies on the most updated information available, as well as informati on specific to the southw est region, absent more specific comments to dispute our power market pric ing projections, EPA disagrees with the assertion that a more thorough analysis is needed.

Figure 1: Projected Palo Verde Forward Prices

Comment: EPA’s economic analysis relied on invalid assumptions

One industry commenter (0384) submitted a repo rt prepared by Management Information Services, Inc. (MISI report) as the ba sis for many of the following comments.

This commenter (0384) stated that EPA’s Afford ability Analysis shows that under certain low market price conditions the cost of SCR retrofit w ould exceed the cost of replacement power for some NGS participants, particularly for SRP and other investor-owned utilities (IOUs) that were NGS participants. The commenter concluded that under such scenarios, continue d participation by those entities facing retrofit costs exceeding repla cement power values woul d withdraw their NGS participation.

The same commenter (0384) asserted that th e Affordability Analysis included invalid assumptions. First, the commenter asserted the econom ic analysis assumed that no new capital would be $35.00 $40.00 $45.00 $50.00 $55.00 $60.00 $65.00 $70.00 $75.00 $80.0020192020202120222023202420252026202720282029203020312032203320342035 

## Projected Palo Verde Forward Prices ($/MWh)

High	Trend Mid	Trend Low	TrendPage 60

EPA Responses to Comments: Navajo Gene rating Station Final Rule | July 28, 2014 deployed at NGS over the next 25 year s but did note that if any new s ubstantial capital cost were to be incurred, particularly in the early years of the mo del timeframe, the resulting impact on the business as usual outcome could potentially be reversed, indicating the cost of S CR retrofits exceedi ng the cost of replacement power. The commenter stated multiple new or pending EPA regulations will necessitate new capital equipment at the gene ration station. The commenter asse rted that inclusion of these incremental capital expenditures will shift the modeling outcome toward a path of closure.

Regarding the cost of the lease agreement betw een the NGS participants and the Navajo Nation, the commenter (0384) stated the eco nomic model incorporated an estimated value going forward of $15 million/yr as a likely proxy for a renegotiated value. Instead, the commenter asserted that the parties have reached a final solution on the renegotia ted lease - $43 million/yr; the economic model’s assumption on lease value is undervalued by $25 million/yr. The commenter stated that the incremental difference is significant enough to alte r the business as usual to show that replacement power is a less costly option than SCR retrofits.

The commenter (0384) further stat ed that the capital costs as set by the Sargent and Lundy study is more inclusive that the cost reflected by the EP A Control Cost Manual; the model’s assumption of the SCR capital cost was undervalued by approximately $50 million. The commenter believed the economic model failed to address the +/- 30 percent variation in capital cost as described in the EPA Control Cost Manual. The commenter stated that adoption of one or both of these change s would again alter the business as usual results to show that replacement co sts is less expensive and, thus, a shut-down of the facility is likely.

This commenter (0384) stated that, while the NR EL report indicated that excess capacity on the western grid would likely be adequa te to serve as replacement power should NGS close, other items in the report suggest more detrimenta l effects, such as high volatility of gas prices (assumption that replacement power would be predominantly gas-fired generation), the larger por tion of power currently used in Arizona that is coal-fired, that coal-fired power is historically le ss expensive than gas-fired power, and the threat to other Arizona based coal-f ired generation as a result of EPA regional haze regulations. The commenter believed th at a combination of all these sugg est that a threat to NGS carries a substantial economic impact to the state th at must be recognized and accounted for.

The same commenter (0384) believes the economic thr eat to the state is part icularly true if the

closure of NGS resulted in increasin g the state’s reliance on gas-fired generation; both water and power cost would increase significantly. The commenter a sserted that the NREL report estimated a likely gas cost of $5 to 6 per MCF over the next decade and that replacing the NGS ge neration with gas-fired, assuming those fuel costs, would result in a cost to the state of roughly $3 billion (NPV) over the next

decade.

The commenter (0384) disagreed with the forecas ted energy prices used in the Affordability Analysis and argued the closure of NGS would have price ramifications in the wholesale market, thus increasing replacement costs. The commenter added that the model’s forecasted prices failed to capture the price volatility of the gas market and the subsequent impact on wholesale power prices.

Response:

The comments submitted, in part, reflected conclusions drawn from the MISI report. The MISI report primarily addressed the macroeconomic links between Arizona and the NGS. These included the economic importance of NGS to the Navajo Nation a nd Hopi Tribe, and the link between the State ofPage 61

EPA Responses to Comments: Navajo Gene rating Station Final Rule | July 28, 2014 Arizona’s economic performance, jobs, water/power prices and pove rty levels. The report sought to quantify potential detrimental effects to the State, Navajo Nation and Hopi Tribe should NGS close Additionally, the report a ddressed the economic impact to partie s in the state shou ld NGS close and replacement generation be fueled by natural gas. The report cites the vol atility of the natural gas market to be of particular concern.

EPA recognizes the economic import ance of NGS to the State of Arizona, the Navajo Nation and the Hopi Tribe. Indeed, the premise behind the Afford ability Analysis was to determine potential price effects from different BART opti ons and whether those effects woul d have a detrimental impact on NGS’s competitiveness within the western power mark et. The probability of closure was a central focus of the Affordability Analysis because a determinati on that a particular BART option could lead NGS to become non-competitive implied that the NGS partic ipating parties would seek to replace the NGS generation with less expensive market power. However, the Affordability Analysis indicated that, even

if BART were determined to be SCR installati on on all three units at NGS , power produced at NGS remained less expensive than the cost to replace power through wholesale purchases. Because utilities will provide power to their customers in a ‘least cost’ manner and because NGS, with the installation and operation of SCR, remained the less expensiv e option, EPA determined that the operation and installation of SCR, in and of itself, was not likely to force NGS to close.

The commenters state that under certain market c onditions (i.e., low power market cost and if the LADWP share is absorbed by anothe r IOU) the Affordability Analysis that accompanied the Proposed Rule suggested that replacement power for NGS under an assumed closure case would be less expensive than the incurred cost of installing SCR on all units. However, in response to multiple comments received from various parties that asserted the for ecasted values employed in the original model for the Proposed Rule are now outdated, EPA updated the Affo rdability Analysis with the most current EIA power market price curves and recent forward power ma rket prices in March 2014. 92 The updated model results are summarized in Tables 5 and 6 below, and include updates to othe r modeling variables in response to other comments and discussed elsewhere in this response to comments document.

Table 5: NPV by Case & NPV Incremental to BA Table 6: NPV by Case & NPV Incremental to BAU Assuming Public Utility Takes LADWP Share 93 Assuming Investor Utility Takes LADWP Share 94

As can be seen, the NPV of SCR investment is less than the cost of wholesale replacement power, both under the scenario of the LADWP share of NGS going to a public utility and under the

92 The updated Affordability Analysis is included in the docket for this rulemaking. See document titled: “Model – 2014 NGS BART Affordability Analysis – r0 – 05_08_14”.

93 See “Model – 2014 NGS BART Affordability An alysis – r0- 04_25_14, Worksheet DASHBOARD”

94 Id. SNC R SC R Low

Marke t Mid

Marke t High

Marke t
8,719 $						 9,278 $						 9,395 $							 9,653 $							 9,904 $

260 $									 819 $									 936 $											 1,194 $							 1,445 $ NPV by Case: Total Plant with DWP Share to POU ( $	million )

Controls & Market NPV Vs. BAU NPV ( $	million ) SNCR SCR Low

Market Mid

Market High

Market

8,761 $						 9,381 $						 9,417 $							 9,674 $							 9,924 $

264 $									 885 $									 921 $											 1,178 $							 1,428 $ NPV by Case: Total Plant with DWP Share to IOU ( $	million )

Controls & Market NPV Vs. BAU NPV ( $	million )Page 62

EPA Responses to Comments: Navajo Gene rating Station Final Rule | July 28, 2014 scenario of the same share going to an investor owned utility (IOU). The upda ted results support the

conclusion that closure of NGS is not the ‘least cost’ option.

With regard to the assertion that EPA used inva lid assumptions in the economic model, the initial modeling effort was purposefully desi gned to isolate the effect of an investment due to BART. Thus, both SNCR and SCR were modeled separately and unde r a condition that other investments and input costs in the plant were held constant. This allowed the determination of what effect BART would have on the cost of electricity generation, and thus, the final value of power produced by the plant. In essence, it isolated the cost of compliance of BART.

EPA recognizes that the assumption to hold al l future capital investments constant was a simplification. As mentioned above, the modeling was desi gned, in part, to isolate just the cost of BART as it impacted the final value of power the plant produced. Additionally, however, it was also recognized that detailing all future investment costs was not possible. The commenter has highlighted several pending or new environmental regula tions that in the future may impose additional costs on NGS. The compliance investments that would be linked to such regulations are unknown a nd cannot, at this time, be estimated with accuracy.

Notwithstanding this inability to accurately esti mate future investments at the plant, EPA has undertaken revised modeling in the Affordability An alysis which, in part, used proxy values for potential future investments. The revision was an attempt to model how the plant’s power cost would be affected under both compliance-related investments as we ll as investments of a different nature such as on-going capital expense. We assumed these future investments to be set at a fixed value annually and continued over a defined time line. We did not attempt to link the investments to a particular activity the plant owners might choose to undertake. However, th e proxy values give an indication of whether the BART compliance investment, coupled with other es timated capital expense ove r time, results in NGS being non-competitive when compared to the option of acquiring replacement power on the wholesale market. Those proxy capital expenses were set at $5 million dollars per year from 2013 through 2038, including annual increases for inflation. 95 The impact of the additional annual capital expense is included in the output tables above.

The commenter noted that the lease agreement between the NGS participants and the Navajo Nation has now been completed and the resulting ne w annual lease value is much greater than the assumed lease value in the model. During the devel opment of the Affordability Analysis, we understood that negotiations were underway on renewing the lease between the NGS participants and the Navajo Nation. We correctly assumed that the existing le ase value ($3 million per year) would change. We assumed a value of $15 million per year that was a pproximated by taking the amount the lease for the

Four Corners Power Plant site lease incr eased following lease renewal and doubling it. 96 After the original Affordability Analysis was completed, howev er, the new lease was concluded at a lease value

95 The modeling estimate for ongoing non-SCR capital expense addr esses capital related to replacement of existing facilities. A regular annual allocation of new capital expense was utilized rather than projecting capital outlays of smaller or larger amounts in conjunction with minor and ma jor maintenance schedules. FERC filings for the regulated utilities and annual reports for the public power entities for the period 2003 to 2013 were reviewed. Under the assumption that only some fraction of the reported annual capital expense ultimately becomes part of the rate base for electric generation, a modeling estimate of $5 million was selected as a reasonable annual average and proxy value for the purpose of accounting for ongoing CAPEX.

96 Press Release, March 8, 2011, The Navajo Nation, “Pre sident Shelly Signs APS Lease Agreement” available at http://www.navajo-nsn.gov/News%20Rel eases/OPVP/Mar11/3811_PresidentS hellysignsAPSLeaseAgreement.pdf.Page 63

EPA Responses to Comments: Navajo Gene rating Station Final Rule | July 28, 2014 of $43 million per year. 97 Recognizing that the orig inal model had underestimated the actual lease cost, EPA has updated the model to incorporate the new value of $43 million per year. The impact of the updated lease expense on the modeling econom ics is included in the tables above.

The commenter also expressed concern that EPA underestimated the cost of SCR in the Affordability Analysis. EPA’s responses to comment s related to the cost of SCR are discussed in section 3.1 of this response to comments document. There, we stated that even if EPA used the 2013 values provided by SRP for the cost of SCR, we w ould still determine that SCR is cost-effective for NGS. Similarly, even if we used the 2013 values provided by SRP for the cost of SCR in the Affordability Analysis, the results and conc lusions of the analysis would not change.

The commenter expressed concern that, if NGS closed and the state became more reliant on natural gas-fired generation, the stat e would face the prospect of highe r electricity prices due to the volatility of the natural gas market. The commenter noted that historically coal costs have been less than the cost of natural gas, thus coal -fired generation has a cost advantag e over natural gas-fired generation.

The commenter asserted that Arizon a ratepayers have benefited from the cost differential since the majority of electricity genera tion in Arizona is coal-based.

Although the cost differential between coal and natu ral gas has been evident historically, there is uncertainty as to whether such a differe ntial will remain in the future years. 98 Given the commenter’s own listing of pending or new environmental regulations (e.g., Utility Mercury and Air Toxics Standard, Green House Gas Tailoring Rule, Coal Combustion Residuals, and Utility Boiler GHG), the importance of these pending regulations is that any and all of these will result in increasing the cost of coal-fired generation. Secondly, with th e proliferation of hydraulic fracturi ng and more comprehensive horizontal drilling techniques, the nation’s gas s upply has greatly increased in just a few years, driving the cost of natural gas down. 99

The commenter contends that closure of NGS and increased reliance on gas-fired generation could cost the state roughly $3 billion (NPV) over the decade following closure. The values are taken from the MISI report (p.67) submitted in support of the comments. The $3 billion value was based upon a projected gas price of $5 to $6 per Mcf, as fo recast in the NREL report. Depending upon the assumed discount rate (which the MISI repo rt did not provide), the assumed ga s prices could equal such a NPV over a set time (10 years, in this case). The value, however, is misleading in th at the cost to Arizona ratepayers arising from a switch from coal to gas-fired generation is not the total value of expenditure on gas, but instead, the incremental difference between what power would cost when produced by coalbased generation versus the same amount of pow er produced by gas-fired generation. EPA’s updated Affordability Analysis incorporated the latest project ed cost values for both coal and natural gas. The

results of the model shown above reflect the outcomes with these more recent fuel cost values.

With regard to comments pertaining to price ramifications in the wholesale market should NGS close, the NREL report estimated the price impacts range from 3.2% to 5.3% in the Arizona and California (LADWP) Balancing Area Au thorities, the pricing areas mo st impacted by a closure. The

97 Navajo Nation Council Resolution, Tracking No. 0177-13, June 19, 2013 available at http://www.navajonationcoun cil.org/Legislations/2013/June/0177-13.pdf.

98 Gas to Coal Competition in the U.S. Power Sector ( http://www.iea.org/publications/in sights/CoalvsGas_FINAL_WEB.pdf

99 Manufacturing Energy Consumption Survey (MECS) EIA http://www.eia.gov/consumption/manufacturing/reports/2010/ng_cost/Page 64

EPA Responses to Comments: Navajo Gene rating Station Final Rule | July 28, 2014 overall Western Electricity Coordi nating Council (western grid) estima ted price impact was 2.6%. Such price increases are not seen as being excessive in light of typical incr eases in utility rates. 100

Comment: EPA’s economic analysis was too conservative

One environmental advocacy group (0373) asserted that EPA’s Affordability Analysis concluded that the capital cost of SCR installed by 2018 was le ss than the cost to repl ace the generation at NGS through wholesale market purchases. The commenter, how ever, stated that this conclusion would have provided even stronger conclusions had the mode l included more accurate assumptions in its depreciation and market price analysis (citing a re port prepared by David Marcus and submitted with the comment). The commenter asserted that there were additional smaller errors in Energy Strategies assumptions that, if corrected, woul d shift the outcome of the model even more favorable for the SCR

investment as least cost.

This commenter (0373) also disagreed with a number of assumptions that were adopted by NREL in its modeling of the cost of installation of SCR. The commenter believes that the use of a 10- year amortization schedule for reco very of the retrofit co sts was too short a timef rame for amortization and skews the modeling results. Additionally, the commenter believed the forecasted price cost of energy used by NREL is inaccurate, as is the assumed cost of retiring the NGS facility. The commenter

concluded that the errors are of such significance that the NREL anal ysis provides little value in EPA’s deliberations and does not support a delay of BART implementation.

The commenter (0373) also disagreed with how CAP water costs were addressed in the NREL model, arguing that NREL adopted some worst-case a ssumptions in analyzing the impact to CAP water cost resulting from SCR insta llation. The commenter believes that adoption of a more reasonable

scenario than worst-case could lower the NREL capital cost estimation by as much as a third. Additionally, the commenter stated that the actual cost impact to CAP wa ter users is within the range of costs adjustment of recent years and the costs are not outside of the expected cost increases in future years. Regarding non-Indian agriculture users, th e commenter (citing the Marcus Report) concluded these users right to CAP water is declining and wi ll be eliminated by 2031 and, thus, any impact to the user group is diminished. The commenter believed that such impacts on wa ter users should not be reason for a BART implementation delay.

Commenter (0373) stated that the investment of SCR is the least cost alternative when compared to wholesale market purchase of replacement power and benefit the national parks and the health of residents of the region. Thus, the commenter conclude d that EPA has failed to make a compelling case for delaying BART beyond the 2018 timeframe.

Response:

We address each of the points raised by the comm enter below that relate to EPA’s Affordability Analysis. EPA is not responding to any comments or concerns raised regarding the NREL analysis

because EPA was not involved in de veloping or writing the NREL report.

The commenter asserted that the Affordability Analysis had employed several assumptions that were invalid, and once corrected, would further support the case that investments in SCR for all units

100 See NREL report, Table 2-6, p.40.Page 65

EPA Responses to Comments: Navajo Gene rating Station Final Rule | July 28, 2014 was the ‘least cost’ option compared to closi ng NGS and replacing power through purchase on the

wholesale market. The commenter focused on the co mparative economics of the SCR case versus the Low Market case. While the original model outcome indicated that the SCR case was less expensive than the Low Market case by $25 m illion, the commenter argued that , based on their calculation, the SCR case should be less expensive than the Low Market case by roughly $600 million. The commenter asserted that the model contained invalid assumptions in two main areas: treatme nt of depreciation and projected power prices.

With regard to the asserted error in deprec iation, the commenter suggest ed that the original treatment of undepreciated assets failed to account fo r the fact that under a clos ure scenario ratepayers would be charged (over a number of y ears) the cost of such assets. In turn, the value of this “stranded

investment” would then be added to the cost of procured power, the re sult of which would be to make replacement cost more expensive.

As noted in the Marcus Report, the design of the original model wa s ‘very conservative’ in that it

did not address the issue of rec overy of stranded investment under the market case scenarios which assume the closure of NGS. As such, the differen tial between the SCR case and the Low Market case was indeed limited by this simplistic assumption. EPA agrees and has revised the Affordability Analysis

to reflect the fact that stranded investment would likely be a com ponent of the cost of replacement power. The revised model includes the assumption that 100 percent of stranded cost, as defined by the undepreciated value of the plant, would be recovered over a 5-year time frame once NGS was closed. 101

In addition, and consistent with anot her assertion that the original mode l failed to use co rrect values for undepreciated assets of each utility, the value of the net plant in service for each utility was revised to

reflect actual filed 2012 data by the utilities. 102 The impact of changes in bo th the net plant in service and stranded cost recovery are now incorporated in the economic model and their impact is contained in

the tables above.

Other commenters asserted that the original m odel failed to differentiate between nominal and real prices with regard to the forecasted power prices. The comments argued that inflation was not properly incorporated into the proj ected prices, thus lowering those projections, resulting in a projected replacement cost of power that was artificially low.

As a simplifying assumption, the original Affo rdability Analysis assumed that in an NGS shutdown scenario, replacement power would be acquired en masse on a forward basis for the entire study term. The forward prices modeled in that ca se were based on actual ex ecutable prices in the market at the time, escalated across the study pe riod according to a curve defined by EIA’s nominal electricity price escalation values. The concept was to approximate a futures market that went further into time than the actual market is traded. Upon fu rther consideration, that sp ecific buying concept does not seem likely. EPA acknowledges that the treatment of projected power prices was predicated on nominal values and thus did not incorporate an inflation adjustment. A lthough appropriate for the forward power purchase concept, th e more likely power replacement scenario would envision both long

and short term contractin g arrangements. For that reason, the model was revise d to incorporate recent power market pricing and the most current EIA long- term electricity trends. The forward electricity

101 The period of time over which stranded costs may be recove red is not standardized and it typically set in regulatory proceedings before state utility commissions, boards, and city councils. A five-year stranded cost recovery period was selected for modeling purposes in recognition of utility rate making practice emphasizing gradualism and generational impacts, where excessively short cost recovery periods move utility rates too quickly, and where excessively long recovery periods labor ratepayers with cost recovery for costs incurred noticeably before they were served by the utility.

102 2012 FERC Form 1 filings for APS, TEP, and NV Energy; FY13 Annual Reports for SRP and LADWP.Page 66

EPA Responses to Comments: Navajo Gene rating Station Final Rule | July 28, 2014 price curve utilized in the revise d Affordability Analysis also account s for inflation by using EIA’s real rather than nominal dollar prices.

In addition to the revisions discussed above , additional enhancements were made to the Affordability Analysis model to address commenter feedback and use updated data where available. These included: an updated annual lease cost to reflect the final value negotiate d with the Navajo Nation ($43 million per year), updated coal price curves (EIA), an assumed $5 million (escalated) annual capital investment in the plant combined across part ies, an assumed decommissioning cost if NGS were closed, and a higher cost for SCR as reported in the 2013 SRP update. 103 The impact of these combined changes in assumptions and input values are all c ontained in the Tables 5 and 6 above and Figure 2 below. Some of the updated assumptions or inputs caused the cost of SCR to increase. Other updated assumptions or inputs caused the cost of replacemen t power to increase. Overall, the combined changes do not change the conclusions from the original Affo rdability Analysis that installing and operating SCR at NGS would be less costly than closing NGS a nd purchasing replacement power from the wholesale

market.

Figure 2: Net Present Value of Contro l Cases Compared to Market Cases

Comment: Cost of maintaining reliability of electric system if NGS closes

A state agency (0017/0289/0320) stated that EPA’ s analysis is not based on a comprehensive reliability analysis, which would be required to u nderstand the full implications of shutting down NGS. According to the commenter, given its size and location and the existing transmission system configuration, NGS is a critical resource to the reliabl e operation of the integrated bulk electric system throughout both Arizona and the wester n interconnection. The commenter indicated that it is highly likely that the closure of NGS woul d result in significant costs asso ciated with transmission system

103 See “Model – 2014 NGS BART Affordability Analysis – r0- 05_08_14.” $8,459 $8,719 $9,278 $9,395 $9,653 $9,904

$8,496 $8,761 $9,381 $9,417 $9,674 $9,924

$‐ $2,000 $4,000 $6,000 $8,000 $10,000 $12,000

BAU SNCR SCR Low	Market Mid	Market High	Market NPV of Total Plant Cases Assuming LADWP Share is Owned by POU or IOU ($	million)

Total	Plant	w	DWP	Share	to	POU Total	Plant	w	DWP	Share	to	IOUPage 67

EPA Responses to Comments: Navajo Gene rating Station Final Rule | July 28, 2014 changes to maintain required levels of system re liability. The commenter believes that without having performed a comprehensive reliabilit y study, EPA has failed to include a ll costs that may be associated

with closure of NGS.

Response:

The commenter is correct that EPA did not c onduct a comprehensive reliability analysis. However, EPA disagrees that a more comprehensive anal ysis of reliability is required to estimate costs

associated with closure.

To conduct a reliability study, one would empl oy a power flow model that would analyze

detailed flows on the western Unit ed States high-voltage grid. The model would test flows under different conditions, thus presen ting likely outcomes should certain events unfold. Such power flow models are often undertaken by th e utilities them selves when contemplating new generation or transmission asset developments. More often, the power flow models are conducted by WECC to gauge system reliability under a variety of circumstances. The NREL study in dicated that roughly one-third of the required replacement power w ould be gained by increased producti on at the NGS participants’ other power stations. 104 The remaining two-thirds would also be regionally obtained (primarily from the Desert Southwest and California), much of whic h would result from current wholesale sales to California being rerouted to the load serving areas of the affected NGS utilities. It would appear, therefore, that ‘system im pacts’ would be regionalized and, given the ability of the cu rrent NGS utilities to obtain replacement power from their own faciliti es (and thus transmit the power over the existing lines that serve the utilities today) such impacts would not change the outcome of our Affordability Analysis.

Additionally, under current conditions, it was assume d that reliability w ould not be adversely

affected should there be a closure at NGS. This assumption was based upon the recognition that in today’s southwest power market, th e current reserve margin is approximately 30 percent (compared to the target margin of 13.5 percent). 105 We assume, therefore, that cl osure of NGS would not stress the regional market to a level where re gional reliability would fall below th e target margin. In other words, even if NGS were to close, the region’s rese rve margin should remain well above the target. 106 We note that the NREL report estimated that the regional target reliability margin would decrease to approximately 22 percent without NGS production, a ssuming no new power plants are built in the region. 107 With substantial reserve margins in the southw est power market, it was therefore assumed that

the likelihood of substantial additiona l costs to be incurred as a functi on of reduced reliability was small.

Comment: EPA’s conclusions about Non-Indian Agricultur e (NIA) water rights and their ability to return to groundwater pumping are erroneous

104 NREL report, Table 2-2, p. 33.

105 NREL report, p. 27.

106 The 2013 North American Electric Reliability Corporation (N ERC) Summer Reliability Assessment, p. 41, reports that the southwestern portion of WECC (defined as the Southwest Reserv e Sharing Group (SRSG) for purp oses of the report) within which NGS resides has a planning reserve margin of 33.87% on Net Internal Load of 28,478 MW and Anticipated Resources of 38,122 MW. The loss of NGS (2,250 MW) would result in a reduction of the reserve margin from 33.87 percent to 25.96 percent. See, http://www.nerc.com/pa/RAPA/ra/Re liability%20Assessments% 20DL/2013SRA_Final.pdf.

107 NREL report, pp. 27.Page 68

EPA Responses to Comments: Navajo Gene rating Station Final Rule | July 28, 2014 Regarding the Central Arizona Irrigation and Dr ainage District (CAIDD), Maricopa-Stanfield Irrigation and Drainage District (MSIDD), Hohokam Irrigation and Drai nage District (HIDD), and New Magma Irrigation and Drainage Distri ct (NMIDD), one public sector co mmenter (0347) stated that the supposition in the TSD that NIA customers may not be able to return to gr oundwater pumping if excess

CAP water becomes unavailable is incorrect. Comment ers (0305, 0347) stated that , under state law, the districts have the authority to pum p groundwater if CAP excess water supp lies are not available or if the costs of that water become too expensive. The commen ter asserted that district s may choose to use their groundwater at any time regardless of the availability or price of ex cess CAP water and they are legally entitled under state law to return to gr oundwater pumping when ever they desire.

One commenter (0305) stated that agricultural water users will not be forced to cease operations if they are unable to continue us ing CAP water, either due to lack of supply or excessive CAP water cost, rather they will convert their supply to gr oundwater and continue in operation. The commenter asserted that the decision by agri cultural water users to shift to groundwater sources depends almost entirely upon the price difference between CAP water th at is available in the future and the cost of groundwater.

One CAP water distributor (0060) stated that EPA’s mention of any potential restriction on NIA water users returning to groundwater is a political statement made to undercut the argument that the proposed order will force NIA back onto groundwate r pumping in direct cont radiction of the public policy behind the enactment of the CAP-enabling legi slation. The commenter asse rted this public policy goal was to ensure the reduction of groundwater pumping in Arizona, pro portionate to the availability of

CAP water. The commenter stated th at they are unaware of any state law prohibiting fa rmers in CAIDD and MSIDD from pumping (through th e districts) their full entitleme nts of groundwater once CAP water is no longer available to them.

Response:

EPA disagrees that any statements we made in the TSD to our proposed rulemaking, related to the ability of NIA customers to return to groundwa ter pumping, were political in nature. In our TSD, EPA recognized the concerns expressed by NIA user s of CAP water, and EPA acknowledged that we did not have a clear understanding of several issues related to NIA water use, including how long NIA users expected to continue using CAP water, whether any restrictions existed in the ability of NIA water users to return to pumping groundwater, and what th e expected source of water would be when CAP water is no longer available to NIA users. Based on the comments submitted, EPA now understands that farmers may return to pumping gr oundwater anytime now, or when CAP water is no longer available to them in 2030 (per the AWSA). EPA recognizes the importance of main taining, preserving, and replenishing groundwater, and that increases in CAP water rates ma y adversely affect the goal of reducing groundwater usage. As stated elsewhere, EPA considers the potential economic impacts to tribes to argue for flexibility in the compliance timef rame for NGS. This flexibility also benefits other stakeholders, including the NIA users of CAP water.

Comment: The assumption that NIA CAP water users will no t have access to CAP water in the future is

not accurate

Commenters (0305, 0347) believe that the conc lusion reached by EPA that volume of excess water for agriculture will be ze ro by 2024 is erroneous. One comment er (0347) referenced Appendix B of the 2012 Annual Report by the Arizona Water Banki ng Authority (AWBA), a state entity that thePage 69

EPA Responses to Comments: Navajo Gene rating Station Final Rule | July 28, 2014 commenter stated is responsible fo r firming municipal and industrial CAP subcontracts, as confirmation

of the error in EPA’s conclusions that excess CAP water volumes will be zero by 2024. Commenter (0060) asserted that EPA’s consultant used the wo rst-case Colorado Water Supply projections of the 14

scenarios reviewed in the 2011 Water Resources Development Co mmission (WRDC) report. The commenter suggested that the wors t-case scenario was used by EPA to marginalize the impact of the resulting high water cost on NI A that would result from BART.

One commenter (0305) stated that the WRDC report is an imperf ect document never intended for use as reference material in a regulatory ma tter. The commenter suggested that EPA should acknowledge in its Proposed Rule that the WRDC report is inappropr iate for the purposes EPA and its

contractor used it. The commenter st ated that EPA should rely on more informed estimates in the future,

but believed that if the WRDC c ontinues to be a source that the EP A relies upon, then EPA should select the most likely scenarios in the WRDC rather than the worst-case scenario.

Commenter (0347) stated that the volumes pr ojected in the AWBA’s Annual Report for 2012 exceed the full agricultural pool of 400,000 acre -feet through 2016 and 300,000 acre-feet through 2022. The commenter projected 104,000 acre-feet of excess wa ter to be available th rough 2030 and concluded that the AWBA and ADWR proj ections do not support EPA’s conc lusion that excess water for agriculture will be zero by 2024.

Commenter (0305) stated that, under the Arizona Water Settlement Act (AWSA), agricultural water users received a quantity-lim ited and time-limited pool of CAP water at an affordable price in exchange for their long-term entitlements to CAP wate r. The commenter asserted that those quantities and durations are 400,000 acre-feet thr ough 2017, 300,000 acre-feet through 2024, and 225,000 acrefeet through 2030. The commenter asserted that the pr oposed BART would upset that arrangement since the AWSA envisioned a means to provide agricultura l water users with an adequate and affordable supply of CAP water.

Response:

The commenters are correct in noting that the A ffordability Analysis report addendum utilized a

WRDC scenario that assumed dec lining CAP NIA deliveries starting in 2017. That table was used to project cost impacts in Table A-2 of the addendum. The commenters are also co rrect in noting that the ADWR 2012 Annual Report, Appendix B shows a consistent volume of NIA CAP water from 2017 through 2023, and not a decline. If the volumes stated in the ADWR report are delivered as projected, then the volume of CAP water used by NIA customer s as a percentage of their total supply would be higher than described in the original Affordability An alysis. The addendum to th e Affordability Analysis also references the same CAP NIA water delivery schedule as indicated in ADWR’s annual report, showing a decline from 400,000 acre f eet in 2007 to 0 acre feet in 2030. For the period of time from 2017 to 2030, had the EPA analysis utilized the ADWR projections and not the WRDC projections, the percentage of supply from CAP for all NIA user s would have been higher. EPA understands that

increases in CAP water rates are a critical concer n to NIA water users of CAP water. As stated elsewhere in this response to comments document, EPA considers the poten tial economic impacts to tribes to argue for flexibility in the compliance tim eframe for NGS. Because additional flexibility also benefits other stakeholders, including the NIA user s of CAP water, this comment does not change our conclusion related to compliance flexibility.Page 70

EPA Responses to Comments: Navajo Gene rating Station Final Rule | July 28, 2014 Comment: EPA’s assumption that NIA CAP water users rely on CAP for only 25 percent of their water supply is erroneous and causes EPA’s analysis to reach a faulty conclusion with respect to affordability

Commenter (0347) asserted that EPA’s assumption that the 25 percent of total NIA water users water supply comes from the CAP is incorrect. For the four districts (CIDD, MSIDD, HIDD, NMIDD), the commenter stated that CAP water as a percen tage of total supply ranges from 85-90% when agricultural pool water is added to ot her excess water that is available to the district through partnerships they have established with the Arizona Indian CAP contractors and municipal and industrial

subcontractors of the AWBA.

Commenter (0060) stated that for the three distri cts it represents, CAP wa ter is 66-90 percent of their annual supply, and between 35-50 percent if only the “Ag P ool” is counted. The commenter believed that by using a lower percen tage (25 percent) EPA sought to minimize the water cost impact of the BART-required emissions controls.

Another commenter (0305) stated that the erroneous assumption that CAP water use by agricultural water users represents only 25 percent of total use is a major assumption resulting in an underestimation of the impacts on farmers in distri cts like New Magma whose CAP supply accounts for 100 percent of their use, when “in lieu” deliveries are included. The co mmenter stated that even after accounting for only the Ag Pool, its members get 50 percent of their supply from the CAP. The commenter asserted that EPA must adjust its analys is by revising the CAP share of total water supply for agricultural water users to a realistic level sign ificantly greater than the 25 percent used in the Affordability Analysis. The commenter concluded that this erroneous as sumption renders EPA’s analysis arbitrary.

Response:

Each of the commenters stated that the volume of CAP water as a percentage of total supply as suggested in the Affordability Analysis (25% or lower) is unrealistic and that EPA’s analysis is

erroneous due to the low assumed value. The commen ts received indicate that reliance on CAP water for NIA users is highly variable between users, with some having substantial if not total reliance on CAP water, under certain circumstances. With respect to th e calculation of water cost impact in the addendum to the Affordability Analysis, NIA CAP customers w ith higher levels of reliance on CAP water would indeed have a higher CAP water cost impact as a resu lt of BART than those with little to no CAP NIA water reliance. The impact will be unique for ea ch NIA customer. EPA unders tands that increases in

CAP water rates are a critical concern to NIA wate r users of CAP water. As stated elsewhere, EPA considers the potential economic imp acts to tribes to argu e for flexibility in the compliance timeframe for NGS. This additional flexibility also benefits other stakeholders , including the NIA users of CAP water, and this comment does not change our conclusion rela ted to compliance flexibility.

Comment: The CAP NIA water cost increases as a resu lt of SCR costs will cause economic harm to CAP farmers

One CAP water distributor (0060) stated that while EPA estimates an increase of $8.40 per acrefoot in CAP water rates for NIA users, CAP estimat es an increase of $10.00 per acre-foot. Referencing
the TSD, the commenter asserted that the EPA esti mate of an $8.40 per acre-f oot increase in CAP NIA water rates would equate to a 14-15 percent in crease for both NIA and Indian agriculture. The

commenter noted that annual increases in NIA water rates have been in the $1-$3 per acre-foot rangePage 71

EPA Responses to Comments: Navajo Gene rating Station Final Rule | July 28, 2014 and that the $8.40 per acre-foot increase estima ted by EPA would be unprecedented. The commenter further asserted that a $10 per acre-foot rate increa se would cost the three di stricts they represent an additional $4.5 million per year, and $9 million if ba ghouses were required. The commenter believed that, as a result of those cost increases, ma ny farmers will be unable to get crop financing.

One commenter (0305) stated that the cost of water represents the highest operating expense for farming (20 percent). The commenter asserted that a major provider of farm credit service in Arizona stated that Pinal County water distri cts have some of the highest wate r costs in areas financed by Farm Credit Services Southwest, and an increase of $16 per acre-f oot in water costs could potentially results in a negative margin that is not financeable. The co mmenter stated that CAP NIA water rate increase estimates provided by CAP in March 2013 range from 200-300 percent. The commenter believes that the EPA’s reliance on the “artificially low estimates” in the Affordability Analys is in the face of CAP’s significantly higher estimates to be arbitrary, capricious, and an abuse of discretion.

Response:

EPA recognizes that NIA CAP water users are sensitive to water co st increases. As compared to business as usual, BART requiring SCR will certainly act to increase NGS costs and therefore increase the CAWCD’s Energy 1 rate. Some clarification rega rding the cost increase pr ojected by EPA and those articulated by the commenters is warranted. EPA’s analysis in the addendum to the Affordability Analysis estimates that the increase in the Energy 1 rate in 2018 as a result of SCR would be $8.40 per acre foot. That incremental cost represents a 14. 5% increase over the estimat ed 2018 Energy 1 rate of $58.00 per acre foot. The commenter’s statement that water costs would increase up to 300% assumes that SCR plus baghouses would be required as BART. 108 More importantly, the commenter’s comparison of SCR-related incremental cost is ma de against 2013 water rates and not estimated 2018

water rates. 109 Relating the increase in cost ag ainst a rate that would not be in place in that year confuses the comparison. The source of the commenter’s co st increase estimates is a March 18, 2013 meeting between CAWCD and EPA in which the CAWCD presen ted its estimates of th e rate impact of both SCR and also SCR plus a baghouse. 110 In that presentation, CAWCD di scussed other non-BART issues that NGS has to resolve in the near term, includi ng coal supply, land lease agreements, and others. According to CAWCD, these non-BART issues alone stand to push the CAP rate above $80 per acrefoot in 2018. In contrast, EPA used projections fo r 2018 CAP water rates of $58 per acre-foot, based on CAWCD’s then-current “Advisory” 2016 rate, he ld constant in the model for 2 years. 111 CAWCD’s currently published rates indicate a 2014 Energy 1 rate of $67 acre foot, itself $9.00 per acre-foot higher

than the estimated 2018 rate used in the EPA Afford ability Analysis, and a $16 per acre-foot increase over the 2014 Energy 1 rate of $51 per acre-foot published in 2011. 112 Looking forward just 1 year, CAWCD’s published 2015 advisory rate is $74 per acre foot. Therefore, the increases in CAWCD Energy 1 rates during the pre-BART determination period (i.e., befo re 2018) suggest that non-BART issues associated with NGS may ha ve a larger impact on water rate s than BART. EPA understands that

increases in CAP water rates are a critical concer n to NIA water users of CAP water. As stated elsewhere, EPA considers the potential economic impact s to tribes to argue for providing flexibility in

108 CAP Agricultural Water Users Task Force (0409), pg. 34.

109 CAP Agricultural Water Users Task Force (0409), pgs. 33-34. For reference, the actual 2013 CAP water rate for agricultural users was $53 per acre foot. The April 3, 2014 “Advisory” rate for those users is $81 per acre foot. (http://www.cap-az.com/i ndex.php/depart ments/finance/water-rates).

110 CAP Agricultural Water Users Task Force (0409), pg. 34.

111 CAWCD, “Central Arizona Project Final 2011/2012 Rate Schedule Update”, June 2, 2011, pg. 1 available at http://www.cap-az.com/Portals/1/Documents/Teresa's%2 0Docs/Final%20Updated%20Combined%202012-2016-RateSchedule.pdf

. 112 Id.Page 72

EPA Responses to Comments: Navajo Gene rating Station Final Rule | July 28, 2014 the compliance timeframe for NGS. This additional flex ibility also benefits ot her stakeholders, including

the NIA users of CAP water.

The revised Affordability Analysis conducted in response to comments of stakeholders and in recognition of changes in SCR installation schedu les, among others, also changes the impact to CAWCD’s Energy 1 rate. Table 7 desc ribes the impact to the CAP rate with implementation of SCR on

the final unit in 2019.

Table 7: Increase in CAP Water Rate s (Energy 1) from SCR+LNB/SOFA

Comment: EPA’s assumption and description of NIA CAP wa ter rights as bei ng non-secure is not

correct

Three commenters (0060, 0305, 0347) st ated that NIA CAP water righ ts are more secure than represented in EPA’s proposal. Commenter (0060) stat ed that the NIA excess settlement pool is the highest priority of all excess uses (one step down from long term us es) and is expected to be fully

available unless there are extreme shortage conditions on the rive r. Commenter (0305) stated that the assumption that NIA CAP water users will somehow be without the option of CAP water leads to an inaccurate assumption that, in future years, no CAP water will be available for agricultural water users and, therefore, no increases in CA P water rates would be passed thr ough to agricultural water users in those future years.

Response:

In the TSD to our Proposed Rule, EPA recognize d the concerns expressed by NIA users of CAP water, and EPA acknowledged that we did not have a clear understanding of se veral issues related to NIA water use, including how long NIA users expect ed to continue using CAP water, whether any

restrictions existed in th e ability of NIA water users to return to pumping groundwater, and what the expected source of water would be wh en CAP water is expected to be fully available to NIA water users



### CAP Energy Rate 1: Impact of Emissions Control Scenarios

Assumptions
Annual	pumping	(AF) 1,550,000
Annual	pumping	energy	(MWh) 2,800,000

2014 2015 2016 2017 2018 2019 2020

67.00 $						 74.00 $			 74.00 $			 74.00 $			 74.00 $			 74.00 $			 74.00 $

2014 2015 2016 2017 2018 2019 2020

Incremental Power Cost ($/MWh)

‐ $										 ‐ $							 ‐ $							 1.61 $					 3.50 $					 5.56 $					 5.43 $ Incremental	Water	Cost	($/AF) ‐ $										 ‐ $							 ‐ $							 2.92 $					 6.32 $					 10.04 $			 9.82 $ Resulting	Energy	1	Rate	($/AF) 67.00 $						 74.00 $			 74.00 $			 76.92 $			 80.32 $			 84.04 $			 83.82 $

0.0% 0.0% 0.0% 3.9% 8.5% 13.6% 13.3% CAP	Energy	Rate	1:	Advisory	Rates	as approved	by	CAWCD	June	2011 Pumping	&	energy	consumption	volumes	as	reported by	CAWCD	12/18/2009	Letter	to	EPA

% Increase over Preliminary CAP Rates 

### SCR ‐ 2017 / 2018 / 2019 Installation Energy 1 Rate: ESTIMATEDPage 73

EPA Responses to Comments: Navajo Gene rating Station Final Rule | July 28, 2014 except in the event of an extreme water shortage. EPA understands that increases in CAP water rates are

a critical concern to NIA water us ers of CAP water. As stated else where, EPA considers the potential economic impacts to tribes to argue for flexibility in the compliance timeframe for NGS. This additional flexibility also benefits other stakeholde rs, including the NIA users of CAP water.

Comment: EPA’s failure to appropriately c onsider the impacts to agricultural water users renders its Factor 2 analysis arbitrary, c apricious, and an abuse of discretion

One CAP agricultural water users gr oup (0305) stated that, as a re sult of errors and omissions, EPA’s factor 2 analysis is arbitrar y, capricious, and an abuse of disc retion. The commenter asserted that there are a range of problems with EPA’s analysis including erroneous assump tions, insufficient support for conclusions, failure to consider decreased farmi ng profitability and increas ed unemployment, failure to acknowledge the inability of NIA water users to pass along cost increases as compared to municipal users, and other factors.

Response:

EPA recognizes that CAP water is an important resource for NIA and other users of water in Arizona. As a result, as one of a number of di scretionary analyses EPA conducted on the indirect impacts on major stakeholders, EPA calculated water rate increases to NIA users of CAP water and municipal and industrial users of CAP water.

EPA disagrees that our discussion of impacts to NIA users of CAP water renders our Factor 2 analysis arbitrary, capricious, and an abuse of discretion. Neither th e CAA nor the BART Guidelines require consideration of indirect costs or indirect impacts of cont rols in a BART analysis. EPA, nevertheless, included an evaluation of impacts to so me of the major stakeholde rs in NGS in our BART analysis under Factor 2, including NIA users, as cons istent with the statement in the BART Guidelines that “the energy impacts analysis may consider . . . whether a give n alternative would result in significant economic disruption or unemployment” (emphasis added). 113

EPA recognizes that the information we had avai lable to us about NIA users of CAP water was limited, and we acknowledged in the TSD to our Propos ed Rule that we had several questions about CAP and groundwater availability to NIA water users. EPA appreciates the clarifications and additional information provided by NIA users of CAP water during the comment period for our proposals. The additional information provided dur ing the comment period about NI A users of CAP water does not change our conclusion under Factor 2, that the potential economic impact s to tribes argue for flexibility in the compliance timeframe for NGS, because th is compliance flexibility also benefits other stakeholders, including the NIA users of CAP water.

Comment: Available options for financi ng the cost of SCR are limited

One commenter (0087) stated that EPA, DOI and DOE’s attempts to reassure the public that the additional controls being imposed by EPA on NGS was misleading. The commenter does not agree that it is appropriate to pote ntially override deficit control measur es to pay for costs imposed by EPA. Further, the commenter emphasized its opposition to the proposed re gulation arguing that EPA cannot

113 See BART Guidelines at 70 FR at 39169 (July 6, 2005).Page 74

EPA Responses to Comments: Navajo Gene rating Station Final Rule | July 28, 2014 undermine U.S. obligations to the Native American people, erode sustainable water policy, and subject struggling Arizonans to high costs, while at the same time cripp ling national debt. In the commenter’s opinion, when the Administration’s own agencies cannot agree, EPA should not require the most expensive technology at this time and unnecessarily impose increased costs on the people who can least

afford it.

One commenter (0343) stated that the Bureau of Reclamation (B OR) is highly unlikely to be able to obtain Congressional appropriations to fund SCR installation. If NGS we re to face closure unless SCR were to be installed, the commenter asserted it would be forced to consider sources of funding for its share of SCR cost, which the commenter esti mated to be $125-$175 million. The commenter stated it

funded the installation of its share of LNB/ SOFA through the Development Fund because the investment size was sufficiently modest ($45 million for all NGS participants) that it could be managed by cash flows in the fund. The commen ter asserted that the cost of S CR, however, would overwhelm the

fund. The commenter stated that the mo st recent large capital investment, SO 2 scrubbers, was funded by appropriations provided by Congress. The commenter asserted that neith er Congressional appropriations nor low-cost 50-year federal loans are currently in place or available today.

Regarding the use of general obligation and reve nue bonds, the commenter (0343) stated that in its experience financing the New Waddell Da m with two bonds issues (1990, 1991) totaling approximately $264 million, the last of which was paid off in 2011, the source of debt service for both of these bonds was an additional cost recovery charge paid by the Salt River Project (SRP) on the power it purchased at the time from BOR’s share of NGS. In those bonding actio ns, the commenter stated that SRP’s credit rating was applied to the bond issues ra ther than using the comme nter’s credit rating. The

commenter stated that it has never established an independent credit rating. Due to the lack of an independent credit rating, the large dollar amount associated with a bonding for SCR, along with the uncertainties with respect to ownership, the coal contract, lease approval and other factors, the commenter believed that bonding for SCR is an untested hypothesis.

Response:

In our Proposed Rule, EPA recognized that th e source of funding for Reclamation’s share of controls was uncertain. We provide d some examples for how air pollu tion controls at NGS have been funded in the past, and discussed the Joint Statem ent between EPA, DOI, and DOE where the three agencies committed to, among other things, seek f unding to cover the federal portion of pollution

controls at NGS. EPA also stated,

it is not clear at this time whether or what type of mechanisms might be

available to lessen increased costs. Th erefore, as explained further below, EPA believes that the potential econom ic impacts discussed in [Factor 2] argue for thoughtful consideration of how flexibility in the compliance timeframe can be provided consistent with the air quality goals of the

Clean Air Act. 114

EPA recognizes that funding for Reclamation’ s share (approximately $130 million for SCR in combination with LNB/SOFA on 3 units) is uncertain. However, we noted in our Proposed Rule that

114 See Proposed Rule at 78 FR 8284 (February 5, 2013).Page 75

EPA Responses to Comments: Navajo Gene rating Station Final Rule | July 28, 2014 The timeframe for compliance would not, in itself, avoid or mitigate

increases in water rates for tribes located in Arizona; however, it would provide time for collaborating federal ag encies to explore options to avoid or minimize potential impacts to trib es, including seeking funding to cover expenses for the federal portion of pollution controls at NGS.

Thus, we recognize that funding of Recl amation’s share of controls is a critical issue, and it is one that the three agencies have committed to addressing t ogether and in consultation with stakeholders. 115

However, we also note that the BART Guidelines do not require EPA or states to consider or determine the source of funding or financing op tions available to utilities as part of the five-factor analysis for

BART.



### 4.2 Comments on Energy and Non-Ai r Quality Environmental Impacts

Comment: Health impacts of pollutants

Many individuals (0020, 0021, 0025, 0047, 0067, 0091, 0113, 0149, 0181, 0210, 0215, 0216, 0217, 0221, 0235, 0237, 0238, 0240, 0253, 0264.5, 0264.6, 0264.8, 0283, 0288, 0290, 0327, 0357, 0360, 0364, 0388, 0396, 0399, 0405, 0414, 0415, 0432) asserted that emissions from NGS harm public health and the environment. One commenter (0215) referenced a Phoenix Magazine article that indicated that Arizona has not “fully” met air quality standards set by EPA since 1979, and urged EPA to review air quality data presented by the ALA. Another commenter (0288) argued that modern pollution controls, which are required at mo re than 250 s im ilar coal plants nat i onwide, wou l d cu r b NGS 's emiss i ons by 84 percent, thus reducing public health risks while improving v i sibility at the r eg i on's national parks. The commenter stated that, according to the NPS, NG S’s emissions cost Arizonans more than $128 million per year in healthcare co sts and over $1.08 billion in spending at national parks in the Four Corners region, although a new analysis estimates healthcare costs at $13 million annually.

One environmental advocacy group (0373) stated th e pollutants that cause visibility impairment (NO x , SO 2 , PM, ammonia, and sulfuric acid) are the sa me pollutants that harm public health. The

commenter noted that NO x reacts with ammonia, moisture, and ot her compounds to form particles that can cause and worsen respiratory diseases, aggravate heart disease, and lead to premature death, and is also is a precursor to ground level ozone, which is associated with resp iratory diseases, asthma attacks, and decreased lung function. Th e commenter stated that SO 2 increases asthma symptoms, leads to increased hospital visits, and can fo rm particles that aggravate respir atory and heart diseases and cause premature death, while PM can penetrate deep into th e lungs and cause a host of health problems, such as aggravated asthma, chronic bronchitis, and heart attacks.

The commenter (0373) quoted EPA as estimating that in 2015, full implementation of the RHR nationally will prevent 1,600 premature deaths, 2, 200 non-fatal heart attacks, 960 hospital admissions,

and over 1 million lost school and work days, resulting in health benefits valued at $8.4 to $9.8 billion annually (citing the Fact Sheet for the final Clean Air Vi sibility Rule). Citing a report prepared by George D. Thurston (Thurston report) submitted w ith the comments, the commenter stated that enforcement of BART requirements at NGS will result in total economic health benefits of $14 to $35

115 See document titled “2013_0104 Joint Federal Agency Statement on NGS” in document number 0005 in the docket for

this rule at EPA-R09-OAR-2013-0009.Page 76

EPA Responses to Comments: Navajo Gene rating Station Final Rule | July 28, 2014 million per year. The commenter believes that this is a highly conservative estimate because it includes only the adverse effects of PM (and excludes ozone a nd other pollutants) and it only estimates health effects in Arizona (and excl udes other downwind states).

The commenter (0373) added (citing the Thurston report) that because fine particulates and ozone are not threshold pollutants, any reduction in these pollutants improves public health, even in areas where the National Ambient Air Quality Standa rds (NAAQS) are met. The commenter stated that these expert findings underscore the need for the EPA to finalize its BART determination for NGS promptly, and for EPA to reject alte rnatives to BART that allow years of delay before SCR is installed.

A member of the Navajo Nation (0412) who is suppor tive of the proposed BART determination

stated that NGS and the FCPP are listed as the worst polluters in the report ti tled “Coal Blooded. Profits Before People,” which the commenter attached to its comments. 116 The commenter said that the report looks at 378 coal-fired power plants in the United St ates and how these plants play a significant role in contributing to a decline in health disproportionate ly in low income communities and communities of color, and in contributing to GHG emissions. The comm enter also referred to the Thurston report, which is also attached to its comment, noting that this report studies the health impacts of NO x from NGS.

One commenter (0529) argued that emissions from NGS cause a dverse health effects in the surrounding area. The commenter discussed the dangers of particulate matter, and particularly emissions from power plants. According to the commenter, the U.S. EPA E nvironmental Benefits Mapping and Analysis Program (BenMAP) air pollution-health eff ects model shows that each year implementation of BART is delayed at NGS will result in an addition al two to five deaths, 1,000 additional Restricted Activity Days, more than 500 extra Asthma Exacerba tion Days, and hundreds more Lost Work Days – at an equivalent cost to society of more than $13 million per year.

Response:

Protection of human health and the environmen t is EPA’s mission, and forms the basis for many Agency actions, including estab lishing the National Ambient Air Qu ality Standards (NAAQS), and promulgation of regulations such as the New So urce Performance Standards (NSPS) and the National Emission Standards for Hazardous Air Pollutants (NESHA P). In addition to Clean Air Act requirements to protect human health, in the 1977 Clean Air Act Amendments, Congress also declared as a national goal the prevention of any future, and the remedying of any existing, impairment of visibility in mandatory class I Federal areas which impairment results from manmade air pollution (See CAA §169A). In 1999, EPA issued the final RHR, which incl uded the requirement for facilities of a certain age to install BART to reduce emissions of visibility impairing pollutants. Therefore, the focus of implementation plans developed under the RHR, is to improve visibility at National Parks and Wilderness Areas. EPA agrees that visibility-impai ring pollutants are among th e same pollutants that affect human and ecosystem health. EPA agrees that human health is an importa nt issue, but specific actions based solely on human health are beyond the scope of the BART requirement of the RHR. As

noted above and elsewhere in th is response to comments document, other programs under the CAA more directly address the impact of stationary sources on public health.

Comment: Disparate Water Rates

116 Coal Blooded. Putting Profits Before People. Indigenous Environmental Network. Little Village Environmental Justice Organization. National Association for the Advancement of Colored People. Lead Researcher-Author: Adrian Wilson, University of Massachusetts at Amherst.Page 77

EPA Responses to Comments: Navajo Gene rating Station Final Rule | July 28, 2014 A public interest advocacy group (0 413) said that Navajo water haulers pay substantially more

for water than customers in southern Arizona. The commenter provided the following comparative rates to demonstrate that despite the low economic conditi ons that many Navajo water haulers come from, the price they pay is significantly more than Central Arizona Project users:

Kaibeto (Navajo community near Page, AZ): $13,034.04/acre-feet of water Glendale, AZ residents: $551.00/acre-feet of water Tempe, AZ farmer: $41.00/acre-feet of water

Response:

EPA recognizes that the cost of water can vary significantly. Alt hough EPA acknowledges this disparity, EPA also recognizes that the potential impacts to tribes in terms of direct revenues and increased water costs are still importa nt issues to tribal governments.

Comment: GHG Emissions/Climate Impact

One public interest advocacy group (0413), a Nava jo grassroots organization, supported EPA’s original BART proposal to reduce NO x emissions from NGS by 84 percent within 5 years. The commenter expressed concern with a dverse effects on health and air quality as a result of coal-fired power plants like NGS and said that the BART pr oposal would improve air quality for nearby residents and reduce regional haze. The commenter referred to the Synapse report submitted with the

comments. 117 The commenter stated that climate change is he re and that the U.S. is seeing more frequent occurrences of extreme and amplified floods, seas ons, drought conditions, hurricanes and tornadoes. These changes in climate disproportionately impact low-income and indige nous people throughout the

world. Because NGS emits 19 million tons of CO 2 annually, adding to GHG emi ssions that contribute to the warming of the atmosphere, the commenter stre ssed that the Agency must move quickly towards renewable energy in order to minimize CO 2 emissions.

Response:

EPA agrees that electric generating units ar e large source of greenhouse gas emissions, and consistent with President’s Obama, “Blueprint for a Secure Energy Future”, EPA has proposed greenhouse gas emission standards fo r new and existing power plants. 118 We note that the purpose of the RHR is to reduce emissions of visibility-impairing ai r pollutants. As such, EPA does not have authority

under section 169A of the CAA or the RHR to regulate emissions of greenhouse gases.

Comment: Negative Coal Effects – Indian Tribes Most Heavily Affected

One public interest advocacy group (0413) argued that the Navajo and Hopi people suffer the majority of the negative consequenc es of coal development in Arizona and New Mexico, and that due to minimal financial resources, tribes end up in compro mising and vulnerable relati onships with industries

117 Sustainable Development for the Navajo Nation. Replacing the Navajo Generating Station with Renewable Energy. January 6, 2014. Frank Ackerman, PhD, Sarah Jackson, and Spencer Fields. Synapse Energy Economics, Inc. 485 Massachusetts Avenue, Suite 2, Cambridge, MA 02139. www.synapse-energy.com.

118 See http://www2.epa.gov/ carbon-pollution-standards/regulatory-actionsPage 78

EPA Responses to Comments: Navajo Gene rating Station Final Rule | July 28, 2014 and the Federal government. The commenter stated that this reliance on coal for economic reasons limits the ability for these communities to protect their h ealth and natural environment. The commenter cited to EPA’s commitment to Environmental Justice and argue d that a process is needed that is adequate and culturally sensitive so that Indigenous people can be informed completely in their native language in order to give them the ability to provide sufficien t input. The commenter indicated that many of their people only speak Navajo. The commenter stated that these people make a humble, but proud living as ranchers, farmers and healers and deserve the right to be heard. These are the people who live closest to the environment, who haul water and are important ca retakers of the land. The commenter asserted that the Navajo people deserve to know what type of pollution is impacting their way of life.

One private individual (0025/0267) stated that NGS and FCPP we re built away from Phoenix and Los Angeles to protect the residents from the dangerous pollution and leave the Navajos with the pollution. The commenter claimed the NGS, FCPP, CPP, CGS and SJGS contribute to regional haze and bronchiolitis to minority children according to State of Ariz ona Health Statistics rates for 2010.

An environmental advocacy group (0401) indicated that historic injustic es and inequities for impacted local communities from NGS continue to be unresolved and unevaluated by EPA and other agencies responsible for energy de cisions in the U.S. Southwest.

Response:

EPA agrees that there are consequences for human health and the e nvironment resulting from coal mining operations and combustion of coal for el ectricity. EPA notes that our rulemaking for NGS is pursuant to the Regional Haze Rule in order to re duce emissions of visibility-impairing pollutants. Although human health was not the impetus for tri ggering a BART determination for NGS, EPA notes that some of the same pollutants that affect visib ility also affect human health. EPA recognizes that many of the comments submitted to EPA from tribal individuals and community groups are most

concerned about the environmental and human health costs of delaying contro ls under our framework for BART Alternatives, and that many of the comm ents submitted to EPA from tribal governments focused on the economic costs of setting a stringent emission limit for BART. EPA is finalizing the TWG Alternative that establishes a cap in cumulative NO x emissions over 2009-2044 (2009-2044 NO x Cap) based on our final BART Benchmark for NGS. The BART Benchmark is calculated from our proposed determination that complian ce with an emission limit of 0.055 lb/MMBtu within five years is BART. Our final regulation provides flexibility to NGS to achieve mo re emission reductions than under BART in a step-wise manner, while reducing potentia l adverse economic impacts to tribes and other stakeholders, by implementi ng the TWG Alternative.

Comment: Coal combustion by-products

A public interest advocacy group (0413) asked that waste generated from the combustion of coal be considered an environmental impact under Factor 2 Energy and Non-Air Quality Impacts and for that reason be required to be removed and cleaned up from the 800-acre land. According to the commenter, the coal ash produced by NGS includes 22,500 lbs of chromium, 27,500 lbs of nickel, and 159,000 lbs of manganese, which are all carc inogens causing lung, bladder, kidne y and skin cancer, and 26,000 lbs of lead, which is a neurotoxin.Page 79

EPA Responses to Comments: Navajo Gene rating Station Final Rule | July 28, 2014 Response:

EPA recognizes that coal combustion residue s are an important concern for human and environmental health. However, we note that waste fr om the combustion of coal is not a non-air quality environmental impact of controls , which is the purpose of the analysis of Factor 2. Coal combustion

residues are not a resu lt of SCR or other air pollu tion controls, but are a resu lt of continued operation of NGS, which is not evaluated under Fact or 2 of a BART analysis. We note that EPA, in a separate action, has proposed a rulemaking related to CCR. 119 The on-going NEPA process provides numerous opportunities and the appropriate fo rum to raise these concerns.

Comment: No basis for public health claim

One of the owners of NGS (0348) stated th at EPA has no basis for claiming that the NO x reductions from NGS that would be achieved by the February 2013 Pr oposal would lead to a public

health benefit. The commenter noted that EPA establ ishes NAAQS at levels that are protective of public health and welfare with an adequa te margin of safety that account s for sensitive populations such as children and the elderly, and that EPA has never f ound that any of the areas around NGS fail to attain the NAAQS. Accordingly, the commenter believes that th ere is no reason to believ e that a reduction in plant emissions to address regional haze would produce a public health benefit. The commenter asserted that before it can claim that the proposed rule will result in health benefits, EPA must conduct a health risk evaluation that follows the four basic steps of the risk assessment process: hazard identification,

dose response, exposure assessment, and risk characterization.

Three private individuals (0088, 0251, 0358) sim ilarly questioned the extent to which NGS emissions are impacting public health. One commen ter (0088) stated that EPA has not provided any medical data demonstrating the frequency or severity of health risks (e.g., asthma and bronchitis) nor have they provided statistical eviden ce that these health risks would di minish due to NGS installing SCR technology. Another commenter (0251) claimed that coal used as household cooking fuel is more hazardous to public health than emissions from NGS.

Response:

Section 169A of the CAA and the RHR focus on reducing emissions of po llutants that affect visibility with the ultimate goal of restoring visibi lity at Class I areas to na tural conditions. In this rulemaking, EPA is setting a limit to reduce NO x emissions from NGS to re duce the visibility impact

NGS has on 11 Class I areas. It is undisputed that NO x , which is the sum of nitrogen oxide and nitrogen dioxide (NO + NO 2 ) is regulated as a criteria pollutant (NO 2 ) as well as a precursor to the formation of

ozone and PM 2.5 , two other criteria pollutants. 120 EPA has noted elsewhere in this response to comments document that some of the pollutants that affect visibility are also re gulated as criteria pollutants that affect human and ecosystem health. In our di scussion of EO 13045 in our Proposed Rule and Supplemental Proposal, EPA has stat ed “to the extent that the ru le will reduce emissions of NO x , which contribute to ozone and fine particulate matter forma tion as well as visibility impairment, the rule will have a beneficial effect on children’s health [ by] reducing air pollution that causes or exacerbates childhood asthma and other respiratory issues.” 121 EPA notes that the purpose of this rule is to reduce

119 http://www.epa.gov/solidwaste/nonhaz/indus trial/special/fossil/ccr-rule/index.htm

120 See, for example, http://w ww.epa.gov/air/urbanair/

121 See 78 FR at 8292 (February 5, 2013) and 78 FR at 62519 (October 22, 2013).Page 80

EPA Responses to Comments: Navajo Gene rating Station Final Rule | July 28, 2014 visibility impairment caused by emissions of NO x from NGS and involves conducting a five-factor analysis as required by the CAA that includes an anal ysis of the anticipated visibility benefits of controls. This process does not involve a health component and therefore, EPA has not conducted a

health risk evaluation for this ru lemaking that attempts to character ize or quantify a public health

benefit.

Comment: Impact on ecosystems

Six private individuals (0327, 0360, 0393, 0405, 0414, 0415) discussed how the emissions from NGS have heavily affected the health of local animal s and plant life in the area, which they rely on for food. Three commenters (0360, 0405, 0414) specifically st ated that fish in local streams are not consumable due to high levels of mercury and othe r toxins, which they believe is a result of NGS emissions. Another commenter (0415) agreed that levels of mercur y in nearby streams and lakes, including Lake Powell are concernin g. Similarly, one private individu al (0307) noted that forests in Arizona and surrounding states are plagued with bark be etles, because the trees ar e too weak to fight the infestation, which the commenter contributes to NGS emissions.

One environmental advocacy group (0373) stated th e pollutants that cause visibility impairment harm terrestrial and aquatic plants and animals, soil health, and moving and stationary water bodies— entire ecosystems—by contributing to acid rai n, ozone formation, and nitrogen deposition. The commenter explained that nitrogen deposition, caused by wet and dry deposition of nitrates derived from

NO x emissions, causes well-known, adverse impacts on eco logical systems; in so me places saturation of the soil already exceeds the “critical load” the ecosystem can tolerate. The commenter added that acid

rain causes acidification of lakes and streams a nd can damage certain types of trees and soils; in addition, acid rain accelerates the decay of build ing materials and paints, including irreplaceable buildings, statues, and sculptures that ar e part of the U.S. cultural heritage.

Response:

As stated previously, section 169A of the CAA and the RHR focus on reducing emissions of pollutants that affect visibility with the ultimate goal of re storing visibility at Cl ass I areas to natural conditions. As such, reducing emissions from NG S for the specific purposes of improving human, animal, plant, or ecosystem health is beyond the sc ope of this rulemaking. We note that the joint EIS process for the NGS and Kayenta Mine renewals is an appropriate venue for raising concerns related to other environmental impacts of NGS and the Kayenta Mine.

Comment: Water use impacts

Four individuals (0248, 0240, 0363, 0399) believe that water conser vation in the Southwest is extremely important because of the dry desert climat e. The commenters warned that the Colorado River is under enormous stress, partly due to NGS and CAP water demands.

One of the commenters (0363) noted that the sn owpack feeding the headwaters of the Colorado River in the Rocky Mountains have reduced over the years, along with a decrease in the surface areas of Lakes Powell and Mead, which the commenter believes is a result of climate change exacerbated by NGS emissions. The commenter added that not a single dr op of the Colorado River flows to the sea at its natural mouth in the Gulf of California, and warn ed that mega-droughts of historic proportions arePage 81

EPA Responses to Comments: Navajo Gene rating Station Final Rule | July 28, 2014 projected for the Southwest in the coming decad es. Another commenter (0399) demanded that EPA maximize Indian water right claims to the Colorado River and the Little Colo rado River in order to create jobs and improve infras tructure services for resident s living without access to water.

Response:

EPA recognizes that water in th e Desert Southwest is a critical issue. However, water use and changes in water availability as a result of climate ch ange are beyond the scope of this rulemaking.

Comment: Impact on groundwater

Some commenters, including a CAP agricultural water users group (0305), an industry trade association (0306), an industry/ commerce commenter (0416), and an association of CAP water distributors (0398), stated that larg e increases in the cost of CAP wa ter resulting from installation of

SCR or closure of NGS could cau se the unintended consequence of agricultural and industry users shifting back to groundwater supplies. These commenter s generally noted that the availability of CAP

water has been a critical element in arresting the severe groundwater that affects most groundwater

basins in the state.

One commenter (0348) stated that as the cost of power increased for delivery of CAP water, an unanticipated result would likely materialize – the substitution of more groundwater for CAP water,

which would risk a shift in the current state’s water por tfolio toward more non-renewable supply. The commenter suggested that increases in delivered water cost could range between $8-16 per acre-foot (depending on whether baghouse technology would also be required) resulting in approximately a 17-33 percent increase. The commenter noted that such increases were validated by the NREL study.

In detailed comments, one CAP agricultural water users group (0305) asserted that EPA failed to properly weigh the BART proposal’s impact on Arizona ’s already-stressed aqui fers in its factor 2 analysis. The commenter asserts that by raising CAP water costs for agricultural water users to levels well beyond those of groundwater pumping costs, a determination that SCR is BART would cause many, if not all, agri cultural water users to stop taking delivery of CAP water and switch to groundwater pumping, a move driven by the commercial realities of the commodity crop marketplace. According to the commenter, this would directly contradict a consistent public policy goal of the State of Arizona and the federal government to protect and preserve Arizona’s aquifers.

This commenter (0305) stated that EPA did not evaluate the impact that selecting SCR as BART would have on Arizona groundwater supplies due to an erroneous assumption that agricultural water users may not be able to return to groundwater if CAP water is not availabl e. To the contrary, the commenter believes that groundwater pumping in Arizona is a matter of state law, and agricu ltural water users generally have continuing ri ghts to pump groundwater from thei r lands, even if they rely upon CAP water. The commenter is not aware of any stat e law that precludes its members from exercising these continuing rights to pump their full entitlements of groundwat er once CAP water is no longer

available to them. The commenter noted that cost of water is already the Central Arizona farmer’s highest operating expense, and a sserted that farmers will turn to groundwater pumping as the only remaining economic source of water if CAP water becomes unavailable.

The same commenter (0305) stated that the impa ct on Arizona’s aquifers of a broad switch to groundwater would be swift, devast ating, and irreversible, causing wate r level declines, land subsidencePage 82

EPA Responses to Comments: Navajo Gene rating Station Final Rule | July 28, 2014 and earth fissuring. According to the commenter, water tables, es pecially in Arizona’s Active Management Areas, would decline and be less able to act as a flexible buffer in times of drought, and wells would become less productive and run dry.

The commenter (0305) indicated that Arizona groundwater is a scarce, non-renewable, and precious resource and that groundwater overdraft has been a concern of the federal government or the State of Arizona for at least 75 years. The commenter noted that state law strictly controls the use of groundwater, and added that a principle purpose of CAP’s enabling legislati on was the protection of groundwater. The commenter concluded that to properl y consider the non-air environmental impacts of

SCR as BART in its factor 2 anal ysis, EPA must consider the imp acts that SCR installation, and the resulting CAP water rate increases, woul d have on Arizona groundwater supplies.

One public/private coalition commenter (0381) also noted significant concer n that the increase in

costs would direct certain industr ies away from renewable water s upplies to more economical, but scarce, groundwater.

Response:

As previously stated in our TSD to our Pr oposed Rule, EPA recogni zed increased use of groundwater, as expressed by NIA user s of CAP water, is a potential indirect effect of our BART determination for NGS. EPA recognizes the importa nce of maintaining, pres erving and replenishing ground water, and that increases in CAP water ra tes may adversely affect the goal of reducing groundwater usage. As stated elsewhere, EPA consid ers the potential economic impacts to tribes to argue for thoughtful consideration of how flexibility can be provided consistent with the air quality goals of the CAA. This consideration of additional fl exibility also benefits ot her stakeholders, including

the NIA users of CAP water.

Comment: Impact on Navajo Aquifer

One public interest advocacy group (0413) stated that Peabody Energy (operator of the Kayenta Mine) has been pumping water from the Navajo Aquifer from beneath Black Mesa for industrial purposes for over 40 years and must be looked at as an environmental and cultu ral impact under Factor 2 Energy and Non-Air Quality Impacts. Further, P eabody Energy uses 1,400 acre-feet per year since 2006 for its Kayenta Mine operations that provides the co al used at NGS, according to the commenter. Before that, the company withdrew on an av erage of 4,000 acre-feet per year to slurry coal to Nevada, the

commenter said. The commenter stre ssed the importance of the Navajo Aquifer as the lifeline to Black Mesa and more than 50,000 Navajo and Hopi peopl e. In the commenter’s opinion, the extreme amount of water used by Peabody presents a challenge to th e natural function of the Navajo Aquifer, which jeopardizes the future supply of water supply and th e quality of the water. To the Navajo and Hopi, Black Mesa and the Navajo Aquife r are also of cultural and spirit ual significance, according to the

commenter.

One private individual (0261) subm itted photos illustrating the eff ect of pumping water from the Navajo Aquifer on land subsidence on Black Mesa.

Response:Page 83

EPA Responses to Comments: Navajo Gene rating Station Final Rule | July 28, 2014 EPA recognizes that the Navajo A quifer is a critical resource to the Navajo and Hopi individuals living on Black Mesa. The on-going NEPA process pr ovides numerous opportunitie s and the appropriate forum to raise concerns related to the impacts of mi ning and use of water from the Navajo Aquifer. We further note that representatives of DOI attended all th e public hearings on NGS held by EPA and are aware of the issues raised by co mmenters during the BART process regarding mining and the Navajo Aquifer.

Comment: Energy shortage

Two individuals (0266, 0292) fear th at the closure of coal-power plants, like NGS, may lead to an energy shortage in the United States, particularly as the dema nd for energy grows. One commenter (0292) expressed concern that a l ack of available energy would resu lt in numerous blackouts and/or interruptions of service throughout the United St ates. Another commenter (0266) explained that Arizona's population is expected to double within th e next 35 years to well over 13 million people, and the power required to meet this demand will be upward s of 100 billion kWh, which is equal to 23 GW or 10 NGS plants.

Response:

EPA recognizes that NGS is an integral part of the Western Grid, the interconnected system of generation and power transmission lines in the West ern United States. While NGS is an important contributor to the Western Grid, it is only one of hundreds of power stations that provide power to

customers in the western states.

The NREL study that was conducted to investig ate pricing impacts a nd adequacy of power supply should NGS close indicated sufficient power on the Western Grid is available for replacement

purposes. 122 Should NGS close for any reason, the NREL study indicates that multiple options are available to replace the NGS powe r from other generating sources.

With regard to the longer term, the Western Grid is monitored and regulated by the WECC, whose membership consists of the power generators throughout the western stat es. WECC’s role is to ensure electric reliability at all times throughout the region. WE CC planning studies are conducted annually and project a 10-year forward market a ssessment. Growth in power demand throughout the region is forecasted and new planned generation and transmission facilities are accounted to ensure that the 10-year plan presents adequate growth in generation and transmi ssion to meet the region’s increasing need for power. As demand for power grows, as refe renced in the comments referring to the projected growth in Arizona, there will be new generation devel oped to keep pace with such growth and to retain reliability on the western system. The WECC’s main role is to ensure that such development keeps pace with the increasing demand for power.

122 NREL report, Figure 2-6, p. 34.Page 84

EPA Responses to Comments: Navajo Gene rating Station Final Rule | July 28, 2014 

## 5.0 Comments on Factor Three – Existing Controls at NGS

Comment: Support for EPA’s consideration of existing controls

A CAP agricultural water users group (0305) commented that EPA’s consideration of the existing controls at NGS is appropriate and well-supported. The commenter noted that EPA’s consideration of the NGS’ voluntary investment in LNB/SOFA takes into account that more than 90,000

tons of NO x emissions reductions have already been ach ieved at NGS. The commenter also expressed support for the EPA’s recognition of the efficacy of the existing SO 2 and PM controls in the context of

its decision that BART determinations for SO 2 and PM are not necessary or appropriate.

Response:

EPA acknowledges that some commenters support our consideration of existing controls. Elsewhere in this response to comments docum ent, we summarize and respond to other comments related to our proposed LNB/SOFA credit (section 8.5) and PM and SO 2 controls at NGS (sections 8.2 and 8.3).

Comment: EPA failed to consider existing controls

The operator of the Kayenta Mine (0384) quoted EPA’s Proposed Rule as stating that the early

installation of LNB/SOFA w ould not influence EPA’s determination of the proper NO x reduction required to achieve BART (citing 78 FR 8284), and a dded that the Proposed Rule shows that EPA used the same approach in modeling (citing 78 FR 8287). Based on this, the commenter concluded that EPA failed to consider existing contro ls, which is impermissible. The commenter stated that EPA cannot ignore the previously installed LNB/SOFA and cannot lump the LNB/SOFA with SCR when assessing

the BART factors.

Response: EPA disagrees with the assertion that we failed to consider existing contro ls. As described in our Proposed Rule, our analysis using a 2001 -2003 baseline is consistent with the BART Guidelines and agreements between EPA and SRP, as well as SR P and Grand Canyon Trust. Because we used a 2001 – 2003 baseline in our BART analysis, EPA evaluate d LNB/SOFA as a separa te control technology, as well as a technology that can be used in combina tion with post-combustion c ontrol technologies (i.e., SNCR and SCR). 123 EPA notes that we also discussed the voluntary installati on of LNB/SOFA under Factor 3: Existing Controls at NGS. 124 The CAA requires consideration of existing controls as one of five factors; however, the BART Gu idelines provide little guidance on how to consider existing controls, except to enumerate the five factors required under th e CAA and to direct states (and EPA) to consider ways to improve the performance of existing control devices. 125 As discussed in section 8.5 of this response to comments document, EPA properly considered baselin e emissions over the period 2001- 2003 in our analysis of cost effectiveness and antici pated visibility benefits of controls. Therefore, although we did not “consider exis ting controls” in the exact manne r preferred by the commenter, we

did consider the existence of LNB/ SOFA in Factor 3 of our BART an alysis, and in a manner that is

123 See Proposed Rule at 78 FR at 8280, 8284 and 8285 (February 5, 2013).

124 Id . at 8284.

125 See Final BART Guidelines at 70 FR at 39163 and 39166 (July 5, 2005).Page 85

EPA Responses to Comments: Navajo Gene rating Station Final Rule | July 28, 2014 consistent with RHR baseline period and the mutual understandings between EPA, SRP (the operator of NGS), and Grand Canyon Trust, developed during the PSD permit process to al low construction of the

LNB/SOFA on one unit per year over 2009-2011. 126

We also note that in our Proposed Rule and Supplemental Proposal, EPA recognized that SRP did voluntarily install LNB/SOFA on one unit per ye ar over 2009-2011 and that th e early installation of modern combustion controls in advance of our propos ed BART determination for NGS resulted in early and real emission reductions from the facility. As described in our Proposed Rule, EPA also proposed to credit NGS for these early reductions in eval uating BART Alternatives. Based on our thorough discussion of the early and volunt ary installation of LNB/SOFA at NGS in our five-factor BART analysis and in our framework for BART Alternatives , EPA disagrees with the assertion that we failed to consider existing controls.

Comment: EPA should determine existing controls to be BART

Several private individuals (0046, 0 069, 0222, 0233, 0243, 0272, 0392) noted that NGS has spent millions of dollars on LNB/SOFA to reduce NO x emissions, improve visibility, and comply with existing requirements. One of the commenters (0222) questioned why EPA would propose new haze requirements before fully understanding the improvements realized by existing controls.

One of the owners of NGS (0348) and the operator of the Kayenta Mine (0384) also noted that in 2009-2011, the NGS voluntarily installed LNB/SOFA on all three units at NGS, reducing NO x emissions to levels below the presumptive NO x emission levels in the RHR. One of the commenters (0348) added that LNB/SOFA eliminated more than 17,000 tons of NO x emissions per year. This commenter stated that with LNB/SOFA, the NO x emission rate from all three units at NGS is less than

the actual NO x emission rates at 236 other coal fired generating stations th at are catalogued in EPA’s

CAMD.

According to this commenter (0348), installing LNB/SOFA prior to a requirement to do so under the RHR or any other CAA requirement has resulted in greater total NO x emission reductions in the first regional haze planning period than would be requir ed by the most stringent EPA BART determination (illustrated by a figure in the comments). The co mmenter stated that EPA should recognize that the existing controls at NGS provide a cost-effective means of reducing NO x emissions to a level that is

lower than more than 200 other co al-fired facilities, and lower th an 37 plants operating with SCR.

The same commenter (0348) stated that EPA supported its proposed BART determination by comparing NGS to the NO x emission rates of the 10 largest coal-fired power plants in the nation and reporting that NGS has not reduced NO x emissions as much as other larg e plants despite the installation

of LNB/SOFA. The commenter asserted that this comparison is inappropriate because the other plants were required to install SCR to address issues such as ozone nonattainment, not for regional haze.

Response:

As stated previously, EPA recognizes that the early and voluntary inst allation of LNB/SOFA on one unit per year in 2009-2011 at NGS resulted in significant emission reductions from NGS. However, we disagree with statements th at LNB/SOFA was installed to co mply with existing requirements

126 See Proposed Rule, 78 FR at 8284 – 8285 (February 5, 2013) and references therein.Page 86

EPA Responses to Comments: Navajo Gene rating Station Final Rule | July 28, 2014 because no requirements existed in 2009 that required the installation of LNB/ SOFA. We also disagree that EPA should wait to determine the visibility improvements realized by LNB/SOFA before conducting a BART determination for NGS. EPA be gan evaluating BART for NGS in 2007 and when we issued a pre-construction permit in 2009 to NGS to allow SRP to install LNB/SOFA over 2009- 2011. During permitting, SRP and Grand Canyon Trust clearly articulated an understanding that the early installation of LNB/SOFA wo uld not prejudice in any way the implementation of more effective

NO x and particulate matter controls at NGS under the regional haze program. 127 EPA understood this agreement meant that we would not forgo doing a BART determination for NGS based on SRP’s voluntary and early installation of LNS/SOFA. EPA did not interpre t this agreement to preclude

consideration of the insta llation of controls during our BART determination.

EPA agrees that the early installation of LNB/SOFA on one unit per year was voluntary and

resulted in .NO x reductions. EPA recognizes that LNB/SOFA are cost-effective, however, based on our five-factor analysis, we have dete rmined that SCR+LNB/SOFA is also cost-effective and we disagree

that a limit of 0.24 lb/MMBtu is BART for NGS. Although the commenter asserts that our comparison

of the NO x emission rates from NGS and the 10 largest co al-fired power plants in the country is inappropriate, we note that EPA did not base our proposed BART determination on this comparison. Our proposed BART determination is based on our fi ve-factor analysis for NGS. In the introduction section of our TSD to the Proposed Rule, EPA incl uded a section titled “A BART Determination for

NO x is Necessary or Appropriate.” 128 Within that section, EPA discu ssed the numerous Class I areas near NGS and the visibility requirements of the CAA and the RHR. EPA also noted that NGS has consistently ranked among the twenty highest NO x emitters in the country and in 2011, was the fifth largest source of NO x in the United States. However, based on comments on the ANPR, EPA also presented ranked data in terms of the amount of NO x emitted per heat input. In terms of this metric,

NGS ranked number 261 in terms of its lb/MMBtu NO x rate in 2011. Previously, commenters suggested that ranking NGS in terms of the NO x rate was more meaningful than reporting only total tons of NO x emitted and that per unit of energy input, NGS produces fewer NO x emissions than 261 other power plants in the United States. 129 EPA does not dispute this fact, but notes that this ranking ignores the size (in MW) and the capacity factor of the unit, which both affect annual NO x emissions. In the TSD to our Proposed Rule, in addition to presenting emissions data as a ranking in term s of total tons of NO x and

NO x rate (lb/MMBtu), EPA considered the largest co al-fired power plants (NGS tends to rank among the largest coal-fired power plants in the country) to assess how NGS co mpares to the largest coal-fired power plants in the country in terms of lb/MMBtu. EPA noted that “although NGS has reduced NO x emissions in recent years through the installation of new combustion cont rols, it has still not kept pace with the largest coal-fired power plants in terms of reducing emissions of NO x .” While the commenter is correct that many of the largest coal-fired power plants in the country reduced emissions of NO x for other requirements, that does not ne gate the fact that, as stated in our TSD, “NGS remains among the largest sources of NO x (in terms of total tons of NO x ) not only because it is among the largest (heat input) power plants, but also because its NO x emission rates is still relatively high compared to other large coal-fired power plants.” 130 EPA’s presentation of this information was appropriate and reasonable, as it was yet another way to understand the same set of emissions data. Although the data

was used to understand emissions from NGS in the context of ot her power plants throughout the country, it was not used, as the co mmenter asserts, as support for our proposed BART determination.

127 See 78 FR at 8284 and 8285 (Febru ary 5, 2013) and references therein.

128 See pages 21-24 of the TSD to the Proposed Rule.

129 See page 24 of SRP comments on the ANPR dated October 2009, submitted by letter dated October 28, 2009 from Richard Hayslip. In this letter, SRP cited 2008 data to suggest that NGS produces fewer NOx emissions than 166 other power plants in the country.

130 See page 23 of the TSD to the Proposed Rule.Page 87

EPA Responses to Comments: Navajo Gene rating Station Final Rule | July 28, 2014 

## 6.0 Comments on Factor Four – Remaining Useful Life of NGS

Comment: Other factors influencing th e continuing operation of NGS

One of the owners of NGS (0348), a st ate agency (0017/0289/0320), three CAP water distributors (0060, 0194, 0214), two industry/commerce commenters (0052, 0306), and the CAP operator (0343) stated that the schedules proposed by EPA for installation of SCR in the proposed

BART Determination and in Altern ative 1 do not provide sufficient time to resolve a number of uncertainties facing NGS before the NGS Participants would have to invest significant capital in additional controls, with the resu lt that NGS could be forced to shut down. Commenter 0348 submitted the most comprehensive comments on this topic and characterized these uncertainties and the related

concerns as follows:

 The initial terms of the plant site lease, Rights Of Way (ROWs) for the plant, railroad, and transmission lines, and other cr itical agreements begin to expire in 2019. The renewal or extension of these agreements will not be fi nal until comprehensive federal environmental reviews are completed. The NGS Participants have reached agreement with the Navajo Nation to extend the lease for the plant through 2044 under term s that will increase future operating costs.

o Those reviews will cover over 20 federal actions and require the complex coordination of at least 10 federal agencies and 15 Native Amer ican Tribes. Once the reviews are completed, the federal agencies will issue a Record of D ecision (ROD) and the Secretary of the Interior must decide whether to approve or disapprove the extensions.

o Federal participation in NGS complicates the process because the U.S. Bureau of Reclamation (BOR) acts as a proj ect participant on behalf of the United States. Under the NGS operative agreements, many decisions, incl uding extending the operating life of the plant, require unanimous consent of the part icipants. The United States may not legally authorize, fund, or implement agreements to extend the operations of NGS prior to complying with the National Environmental Po licy Act (NEPA), the Endangered Species Act (ESA) and the National Historic Preservation Act (NHPA), which requires a comprehensive

multi year federal environmental re view process. The Bureau of Indian Affairs (BIA) also must approve the new lease.

o Given the number of stakeholders involved, BOR’s role in the pr ocess, the complexity of the project, and the extensive public input that is expected, the federal reviews will take several years and likely will be subject to litigation.

o The NGS Participants are concerned that EP A’s proposal will not allow sufficient time to complete the federal environmental review proc esses, resolve anticipated litigation, secure the necessary air permits, and complete the design and construction of the additional controls. The NGS Participants cannot justify significant capital expenditures on the procurement and construction of emissions cont rols until the lease ex tension is approved, risks of litigation begin to diminish, and they are reasonably certain the plant can continue to operate. Additionally, the United States may not be able to authorize or fund the capital improvements necessary to comply with the pr oposed rule until it has complied with NEPA, ESA and NHPA, which will take several years.

 Coal for NGS is supplied by the Kayenta Mine , which is managed by Peabody Western Coal Company (Peabody). The coal supply agreemen t with Peabody needs to be extended beyond 2019, and is currently being rene gotiated. The renegotiated agreem ents will likely result inPage 88

EPA Responses to Comments: Navajo Gene rating Station Final Rule | July 28, 2014 higher future operating costs for the NGS Particip ants, which would affect the overall economics

of NGS and has not been taken into account in the EPA’s analysis.

 Two of the current NGS Participants, the Lo s Angeles Department of Water and Power (LADWP) and NV Energy (NVE), have indicated thei r intent to exit NGS or are required to exit NGS, before 2020. LADWP has publically stated its objective of exiting NGS by the end of 2015. This future ownership uncertainty creates a substantial challenge because all NGS Participants may not be able or willing to commit to the significant fina ncial investment. If EPA imposes a requirement to install SCRs before th e ownership issues are resolved, the remaining NGS Participants are not likel y to approve the investment.

According to the commenter (0348), as a result of these uncertainties, the timelines EPA proposed for

installation of additional controls in its BART Determination (S CR within 5 years) and Alternative 1 (SCR in 2021 2023) are problematic for the NGS Participan ts. The commenter adde d that although the commenter is working with the other NGS Participan ts, various federal agencies, and Native American interests to resolve each of these uncertainties, it will be several years before the NGS Participants will be reasonably certain that the plant will continue to operate. The commenter asserted that if EPA were to issue a final BART rule that includes only its BART Determination and Altern ative 1, NGS likely would

be forced to close.

The commenter (0348) submitted a timeline illustra ting the alleged timing constraints. According to this timeline, the ROD approving the extension of th e leases would be expected to be issued in 2018, and it would then take until 2026 to plan and design, pe rmit, and construct the controls on the three units

at NGS.

The commenter (0348) noted that while acknowle dging that NGS may conti nue to operate until 2044 as a potential outcome of the lease renewal negotiations, EPA also recognized that these various uncertainties could affect the facility ’s ability to operate in the future and proposed a useful life value of 20 years for NGS and used this value as the defau lt for amortization purposes (citing 78 FR 8285). The commenter asserted that if either the proposed BART determination or the pr oposed Alternative 1 were made final, NGS would likely shut down by 2019 becau se the NGS Participants are not likely to make large capital improvements without certainty that the plant could continue to operate beyond 2019.

Response:

As discussed in our analysis of Factor 2, EPA conducted an Affordability Analysis to determine whether the installation and operatio n of SCR would make electricity generation at NGS more costly than purchasing power on the wholesale market, as a way to evaluate whether SCR would force NGS to close. Based on our analysis, the installation a nd operation of SCR would not make electricity generation at NGS more costly than purchasing power on the wholesale market; therefore, EPA

determined that a useful life of NGS of 20 years as the default value for amortization purposes was appropriate.

EPA recognized that the owners of NGS might expr ess the need for additional flexibility in the compliance timeframe. EPA proposed the 2021-2023 timefra me in Alternative 1 because that timeframe

would allow total emissions under Alternative 1 to be lower than the BART Benchmark when accounting for the LNB/SOFA credit. EPA put forth two examples that provided additional time for compliance (Alternatives 2 and 3, with complia nce in 2023-2025 and 2024-2026, respectively), where

total emissions were not lower than the BART Benc hmark but could be viable if the owners of NGSPage 89

EPA Responses to Comments: Navajo Gene rating Station Final Rule | July 28, 2014 achieved additional emission reductions to bridge the deficit in NO x emission reductions. 131 Based on this framework, the Technical Work Group on NGS put forth in Appendix B to the TWG Agreement

that included the closure of one un it (or equivalent curtailment) by the end of 2019, in addition to the LNB/SOFA credit, to allow additional time for compliance with a limit achievable with new postcombustion controls (i.e., SCR).

Comment: EPA should have accounted for a 30-year life

As discussed elsewhere in this response to comments document (section 3.0), one commenter (0367) asserted that the lifetime of an SCR system for NGS should be at least 30, no t 20 years. The commenter argued that even a 30-year lifetime is its elf very conservative as many SCRs installed in Europe in the 1980s are still in op eration today, and an analysis prep ared by Black & Veatch for another facility assumed a 40-year lifetime for SCR. The lifetime of an SCR retrofit is generally set equal to the remaining useful life of the facil ity – in this case 2044. There is no s upport in the record for a 20-year lifetime and the cost assumptions associated with it.

Response:

As discussed in our responses in section 3.0 of this response to comments document, using an amortization period of 30 years instead of 20 years would lower the annual cost of controls, making SCR appear more cost-effective. EPA has already de termined that SCR at NGS is cost-effective, and

EPA would still determine that SCR at NGS is cost -effective if the annualized cost was lower. This would not change our overall determination that an emission limit achievable with SCR is BART for

NGS.

131 See 78 FR 8290 (February 5, 2013).Page 90

EPA Responses to Comments: Navajo Gene rating Station Final Rule | July 28, 2014 

## 7.0 Comments on Factor Five – Anticipated Visibility Improvements

Comment: General

Numerous individuals (0016, 0026, 0036, 0042, 0044, 0045, 0046, 0048, 0051, 0053, 0054, 0069, 0070, 0075, 0077, 0078, 0079, 0081, 0086, 0088, 0099, 0106, 0109, 0132, 0145-0148, 0160, 0161, 0165, 0167, 0168, 0193, 0195, 0200, 0203, 0205, 0212, 0222, 0233, 0251, 0264.1, 0265, 0266, 0277, 0299, 0329, 0437), government commenters (0287, 0324, 0406), a public/private coalition (0400), a chamber of commerce (0140), and industry/commerce trade associat ions (0084, 0278) questioned the

extent to which NGS emissions im pact visibility at national parks and wilderness areas or disputed EPA’s analysis that installation of SCR at NGS w ould improve visibility. Most of these commenters blame the haze on emissions produced from other sources , such as cars, dust storms, forest fires, and prescribed burns, as well as pollution produced fro m nearby cities and states including California. Nearly all of the listed commenters, as well as three additional indivi duals (0056, 0133, 0292) and an industry/commerce commenter (0052), encouraged EPA to review existing studies (i.e., an NREL study, a study published by the Arizona Republic, and analyses conducted by SR P and done in coordination with EPA) that show that NGS does not have a significant impact on re gional haze, and that NO x controls would yield an improvement in visi bility at the Grand Ca nyon. Many commenters also suggested that EPA offer more time for people to review the rule and provide comments.

Three individuals (0016, 0088, 0233) stated that the wind direction near and around the Grand Canyon blow predominantly west to east; thus, emi ssions from the NGS are pushed away from parks (including Zion and Bryce parks) no t towards them. One of these comm enters (0088) acknowledged that parts of Grand Canyon National Park are located within 20 miles of NGS , but emphasized that the most visited areas of the park are located more than 70 miles away fr om the plant. This commenter proposed shutting the NGS plant down for a week to see if ther e are any improvements to visibility at the national parks and wilderness areas.

One commenter (0251) contended that SO 2 emissions are a greater co ntributor to the production

of haze than NO x emissions, and noted that these emissions at NGS have already been reduced by 95 percent. Another commenter (0222) mentioned reports that concluded that power plants represent only about 5 percent of the emissions that o ccasionally create haze at the Grand Canyon.

One commenter (0358) has not seen evidence of a pollution problem near Lake Powell. In contrast, two individuals (0360, 0414) specifically st ated that they have experienced haze at Lake

Powell.

Response:

We are aware of the studies cited by commenter s purporting to show that controls on NGS would yield little visibility improvement, a nd we address them in responses be low. We are also aware of work performed by the Western Regional Air Partnership showing the relative pr oportions of sulfate and nitrate visibility impacts, and the relative contribu tions from various types of pollution sources, with nitrate from point source s being relatively small. 132 We note that the analyses of the most-impaired days

have a substantial or even domi nant contribution from mainly non-anthropogenic wind-blown dust or

132 See, e .g. WRAP PM Source Apportionment Technology (PSAT) results, available on WRAP Technical Support System, Source Apportionment web page at http://v ista.cira.colostate.ed u/TSS/Results/SA.aspxPage 91

EPA Responses to Comments: Navajo Gene rating Station Final Rule | July 28, 2014 fires; but that does not mean nitrat e contributions from stationary sour ces are small on other days. In any case, a BART determination is required under the Regional Haze Rule because our modeling, conducted according to the procedures set out in the BART Guidelines, has s hown that NGS causes visibility impairment at multiple Class I areas. The RHR re quires that the Best Available Retrofit Technology (BART) be installed on certain old, la rge stationary sources as part of the overall approach to improving visibility at Class I areas. No one individual control will be sufficient to meet the goal of “remedying of any existing, impairment of visibil ity in mandatory class I Federal areas which impairment results from manmade air pollution”, as set ou t in Clean Air Act section 169A. Under BART, controls must be imposed when a BART-eligible source has the potential to contribute to visibili ty impairment and costeffective retrofit controls are available, as we have shown for NGS, in accordance with the five factor

determination set out in the BART Guidelines.

On the issue of wind direction, we note that the CALPUFF modeling uses three years of hourly meteorological input, which is based on meteorol ogical modeling as well as observational data from stations throughout a large area. Th e input includes wind speed and direction, and would include the particular wind direction pattern s noted by the commenter. The more sophisticated meteorological

treatment in CALPUFF enables it to track the pollutant plume from NG S, including its twists and turns over multiple days. This is necessary since polluta nts do not necessarily follow a straight line single wind direction path from NGS to the Grand Canyon. We believe that th e approach used in our modeling adequately accounts for winds noted by the commenter.

On the various locations within the Grand Ca nyon, we note that the CALPUFF modeling carried out according the BART Guidelines includes all locatio ns in Grand Canyon National Park, as well as in ten other Class I areas. The analys is does not weight particular lo cations on the basis of visitor frequency. Rather, for each modeled day it takes th e worst visibility locati on over the whole area, and then finds the 98th percentile among the days ( i.e. it excludes the worst seven or so days for each year). The underlying visibility goal applies to the entire Class I area, all of which may be visited, and we have no basis for excluding particular loca tions. We also note that vistas s een by visitors n ecessarily extend over many miles, including less-visited areas, so visibi lity impairment at the latter would be noticed at

the more-visited areas.

EPA considers it impractical and unnecessary to shut down NGS to determine its visibility impact; that is the purpose of the CALPUFF model as laid out in the BART Guidelines. A temporary

closure of NGS would result in a subs tantial impact to the operator of NGS and those that rely on power from the facility. In addition, because visibility is the result of the interact ion of pollutants from many sources, and that interaction varies with meteorology, teasing out the particular effect of NGS would not be straightforward. It would re quire an expensive and time-consuming new study that would be impractical and well beyond the level of effort envi saged in the BART Guidelines, which laid out an “off-the-shelf” approach applicable to the many sour ces subject to BART across the country. We believe that the CALPUFF approach is ad equate for purposes of assessing the visibility impact of NGS.

Lake Powell is not specifically included in the CALPUFF modeling of NGS, which under the RHR and the BART Guidelines focuses on Class I areas, such as national parks. We note that visibility impairment close to NGS, such as at Lake Powe ll, may also be caused by phenomena other than the regional-scale haze impairment that occurs as chemical reactions proceed over longer distances. Conversely, controls imposed to addr ess visibility impairments at Cla ss I areas are likely to provide some benefit in the general area in which Lake Powell is located.Page 92

EPA Responses to Comments: Navajo Gene rating Station Final Rule | July 28, 2014 Comment: General support for EPA’s vi sibility modeling analysis

One environmental advocacy group (0373) suppo rted EPA’s modeling results for NGS and

concluded that NO x emissions from NGS have a substantial imp act on visibility in many of the 11 Class I areas within 300 kilometers (km) of NGS, with impa irment greater than 1 dv at each of the areas. The commenter added, based on a report prepared by Victoria Stamper (Stamper report) and submitted with the comments, that while EPA limits its BART review to Class I areas within 300 km, there a number of other national parks and wilderness areas within 400 km that woul d likely experience improved air quality as a result of BART at NGS. The comment er noted that the RHR establishes a target for achieving natural visibility conditions at all Class I ar eas by 2064, which is within 50 years, and asserted that dramatic reductions in visibility impairment attr ibutable to NGS are a prerequisite to meeting this goal. The commenter added that it will be nearly im possible to know what other sources in the region must do in the first implementation phase (by 20 18) absent timely emission reduction at NGS.

Another environmental advocacy group (0395) said that it is crucial to apply the most rigorous

emissions controls av ailable to address NO x emissions at NGS in order to sufficiently protect the surrounding Class I areas. The commenter discusse d how EPA correctly addressed, via a rigorous BART methodology, emissions from NGS under all atmo spheric conditions. The commenter pointed out that even very small amount of pollution emitted on a clear day degrades visibility dramatically. Also, the commenter said that the nitrate imp acts associated with large amounts of NO x being emitted from NGS will have a greater impact during the winter due to nitrate’s instability at higher temperatures. The commenter added that the Agency’s rigorous fact-b ased BART analysis clearly supports the most stringent controls for NO x at NGS. The degree of visibility im provement that will result, which EPA thoroughly analyzed, indicates subs tantial benefit from reducing NO x emissions at NGS.

Response:

We agree with the commenters that NGS causes h aze impairment at multiple Class I areas. More distant Class I areas may well also be affecte d. However, the Federal Land Managers generally recommend CALPUFF modeling of areas within 300 km, and we have rela tively little experience with greater distances. In promulgating CALPUFF as an a pproved model, we stated: “It was concluded from

these case studies that the CALP UFF dispersion model had performed in a reasonable manner, and had no apparent bias toward over or under prediction, so long as the tr ansport distance was limited to less

than 300 km.” 133 An interagency workgroup (IWAQM) conclu ded: “With the above thoughts in mind, IWAQM recommends use of CALPUFF for transport distances of order 200 km and less. Use of CALPUFF for characterizing transport beyond 200 to 300 km should be done cautiously with an awareness of the likely problems involved.” 134 Finally, given the large numbe r of Class I areas within 300 km of NGS, and the tendency of facility impacts to decrease w ith distance, the inclusion of

additional areas would not have aff ected the outcome of our BART de termination. We believe that the 300 km radius is appropriate. We also agree that the better the backgroun d visibility, the more perceptible is a given amount of pollution; this is built into the deciview haze index we use as the visibility metric. In other words, a relatively sma ll amount of pollution impairs visibility more in the relatively pristine western parts of the U.S. more than it would in the comparatively degraded east. The part of the country where NGS is located has histor ically been known for its excellent visibility, and

133 “Revision to the Guideline on Air Quality Models: Adop tion of a Preferred Long Rang e Transport Model and Other Revisions”; Final Rule, 68 FR 18440, April 15, 2003; at p. 18458.

134 Interagency Workgroup On Air Quality Modeling (IWAQM ) Phase 2 Summary Report And Recommendations For Modeling Long Range Transport Impacts (EPA-454/R-98-019), EPA OAQ PS, December 1998, p.18. http://www.epa.gov/scram001/7t hconf/calpuff/phase2.pdfPage 93

EPA Responses to Comments: Navajo Gene rating Station Final Rule | July 28, 2014 reasonable controls on large sources such as NGS are necessarily part of the ove rall approach needed to restore that visibility.

Comment: EPA underestimated visibili ty benefits of SCR

One environmental advocacy group (0373) stated th at the visibility benefits of SCR are higher than modeled by EPA because EPA underestimated SCR performance (see section 8.1) and because EPA overestimated the potential increase in sulfate emissions that may come with the addition of SCR controls in the following ways:

 EPA assumed a higher conversion rate across the catalyst than that used by Sargent & Lundy (S&L), and the conversion rate us ed by EPA is high when compared to other examples of SCR systems designed for 80 to 90 percent NO x control (citing the Stam per report and the ICAC White Paper submitted with the comments). To be consistent with its own modeling for the SJGS, EPA should have assumed a c onversion rate no higher than 0.5%.

 EPA appears to have erroneously used a higher co al sulfur content than SRP has indicated is actually used at NGS. EPA should correct its calc ulations to reflect a sulfur content of 0.593 percent, not the 0.772 percent that EPA app ears to have used in its calculations.

The commenter (0373) stated th at its modeling shows greater visibility improvement than demonstrated by EPA, due in part to the necessary corrections to EPA’s calculations outlined above and in the Miller/Sahu report submitted with the comments (citing the Miller/Sahu report). The commenter added that SCR produces considerably superior vi sibility benefits over an y other technology or any

alternative that has been proposed, and concluded that SCR plus LNB/SOFA clearly is BART for NGS because SCR plus LNB/SOFA is th e best-performing technology for NO x pollutant control, it is cost effective, and it achieves significant vi sibility benefits across all of the Class I ar eas that are polluted by NGS, far more than any other technol ogy or combinations of technologies.

The commenter (0373) also noted that EPA’s mo deling (with the errors alleged above) showed that SCR plus LNB/SOFA at NGS w ould have the greatest visibility benefits to the affected Class I areas, providing at least 1 dv of improvement in all of the Class I areas modeled and far more than 1 dv benefit at 75 percent of the 11 affected Class I areas. The co mmenter indicated that EPA’s modeling (even with alleged erro rs) showed improvements in air qual ity at Grand Canyon, Capitol Reef, and Canyonlands National Parks that are among the single largest improvements in air quality to national parks from anywhere within the haze program. The commenter added that, according to EPA’s model, cumulatively the air quality in 11 national parks and wilderness areas will improve by 35 deciviews with the installation of SCR plus LNB/SOFA at NGS , amounting to a 73 percent improvement in the visibility impairment attribut able to NGS (citing 78 FR 8287).

Response:

EPA agrees that the visibility modeling include d in our Proposed Rule for our analysis under

Factor 5 indicates that SCR+LNB/SO FA results in the largest reduction in the visibility impact of NGS

at 11 Class I areas. We note that the commenter agrees with EPA’s assessment under Factor 5 and our conclusion that BART for NGS represents an em ission limit achievable with SCR+LNB/SOFA. In our Proposed Rule, we stated “EPA is proposing to determ ine that the anticipated vi sibility benefits of NO x controls at NGS supports SCR+LNB/ SOFA as the most stringent technologically feasible and cost

effective NO x emission control technology for NGS.” The commenter contends that EPAPage 94

EPA Responses to Comments: Navajo Gene rating Station Final Rule | July 28, 2014 underestimated the visibility benefits of SCR. Th us, the commenter is essentially arguing that the anticipated visibility benefits are even more supportive of our proposed BART determination.

First, the commenter contends that we underestimated the perf ormance of SCR. EPA addresses comments on the performance of SCR (i.e., that SCR can achieve a lower limit than the one proposed by EPA as well as comments arguing that EPA’s proposed lim it is too high) in sec tion 8.1 of this response

to comments document. Based on our review and an alysis of comments on the BART emission limit, EPA is determining that our proposed BART limit of 0.055 lb/MMBtu for each unit at NGS is achievable and appropriate.

Second, the commenter contends th at we overestimated the potenti al increase in sulfuric acid emissions resulting from SCR. In our visibility m odeling analysis, we assume d that a 3+1 SCR system (composed of a total of four laye rs of catalyst with initial deploym ent of three layers, followed by the addition of another layer after 16,000 hours of operation) would result in a total SO 2 to SO 3 conversion rate of 0.67 percent. 135 As discussed in the TSD to our Propos ed Rule, AECOM, the consultant who prepared a BART analysis on behalf of SR P, assumed a conversion rate of 1 percent. 136 EPA sought additional information on lower conversion catalyst s and received information from Hitachi Power Systems of America (a vendor for low-conversion catalysts ), that three layers of the CX series catalyst

would result in a total conve rsion rate of 0.5 percent. 137 Based on this information, and our understanding that an SCR system to meet a limit of 0.05 lb/MMBtu would require a 3+1 system, EPA conservatively used the conversion ra te when four layers of catalyst are in operation (i.e., 0.5 percent from three layers plus 0.17% when the additional layer is deployed). 138 Similarly, when considering a limit of 0.08 lb/MMBtu (achievable with a 2+1 system), EPA used a conversion rate of 0.5 percent based on the period when all three layers are in us e. The commenter asserts that this analysis is inconsistent with EPA modeling for San Juan Genera ting Station, where a convers ion rate of 0.5 percent was used. However, we note that the SCR system at SJGS was intended to be a 2+1 system. 139 We also note that for Four Corners Power Plant, EPA used a conversion rate of 0.6 per cent, based on the average of operation with 3 layers (at 0.5 per cent) and 4 layers (at 0.7 percent). 140 Therefore, although the commenter suggests that EPA is being inconsistent with itself, we note that our use of a conversion rate of 0.67 percent for NGS is entirely consistent with our use of 0.5 percent for SJGS because NGS is intended to be a 3+1 system whereas SJGS was inte nded to be a 2+1 system. Additionally, our action for Four Corners also accounted for higher conversion ra tes when all layers of cat alyst are in use. Although we used a higher numerical value for NGS than fo r Four Corners (i.e., 0.67 percent instead of 0.6 percent) EPA opted to be more c onservative in this case and apply the maximum value rather than an

135 See document titled “NGS_emissions scenarios for modeling_2012May.xlsx” in document number 0004 in the docket for

the rule at EPA-R09-OAR-2013-0009.

136 See page 112 of the TSD for the Proposed Rule, document number 0014 in the docket for the rule at EPA-R09-OAR2013-0009.

137 Id. and references therein.

138 Although the 2010 Sargent and Lundy SCR Cost study provided a catalyst vendor quote specifying 0.5 percent conversion from four layers of catalyst (2+2 system ), EPA chose to use the more conservative value and quote we received from Hitachi based on 0.5 percent from three layers of catalyst. The 2010 S&L Cost Study, titled “2010-08 NGS_Report_SCR_and_BH_Cost_Est_Rev_D.pdf” is included in the docket for the rule in document number 0005 in the

docket for the rule at EPA-R09-OAR-2013-0009.

139 See page 25 of the document titled “Complete EPA Response to Comments for NM RH SIP final.pdf” in the docket for

the rule at EPA-R09-OAR-2013-0009. The discussion in this document includes information that lower conversion rates have been measured but that vendors will guara ntee a total SCR system conversion rate of 0.5 percent for two active and one spare layer, and that SJGS will be a 2+1 design.

140 See tab titled “fc3 SCR”, row 41, in document titled [2-3, 95] FCPP_BART_Scenarios_Emissions_EPA_Proposal.xlsx” in document number 0017 in the docket for the Four Corners Power Plant rulemaking at EPA-R09-OAR-2010-0683.Page 95

EPA Responses to Comments: Navajo Gene rating Station Final Rule | July 28, 2014 average value. EPA views both methods as reasonab le. EPA also notes that the regulatory action on SJGS by EPA Region 6 is now proposed to be resci nded and replaced by a SIP revision by the State of

New Mexico. 141

The commenter states that EPA erroneously used a value for fuel sulfur content of 0.772 percent for NGS, and that we should correct our visibility modeling to us e a value of 0.593 percent. Although we erroneously reported a fuel sulfur content of 0. 772 percent in the TSD to our Proposed Rule, 142 in the emission spreadsheets we developed for our visib ility modeling, EPA used the correct value of 0.593

percent. 143 Therefore, although the TSD reported the wrong value, the values used in our visibility modeling were correct.

Although the commenter contends that EPA undere stimated the visibility benefit of SCR, we disagree with the assertion that th e BART limit for SCR should be lo wer and that we overestimated the

increase in sulfuric acid. Alt hough we chose to model sulfuric aci d conservatively, even if we had

chosen the value for SO 2 to SO 3 conversion recommended by the co mmenter, the result would be to

indicate that our anal ysis of Factor 5 is even more supportive of the conclusion that we already reached

for Factor 5 based on our more conservative anal ysis. Therefore, although we disagree with the commenters assertions, even if we agreed, the resu lt of our five-factor anal ysis would not change.

Comment: Relative visibility impact of NO
x from NGS

One of the owners of NGS (0314) a sserted that EPA’s singular focus on NO x emissions from stationary sources during the first regional haze pla nning period is misplaced and will be ineffective

because nitrate aerosols are a rela tively minor contributor to visibili ty impairment in Class I areas

located on the Colorado Plateau.

A CAP agricultural water users group (0305) stat ed that EPA’s factor 5 analysis failed to appropriately acknowledge that NGS NO x emissions lead to only a very small fraction of total visibility impairment in the Grand Canyon and the other Class I areas. As an example, the commenter noted that

both FCPP and emissions from sources outside the 300 km radius that CALPUFF considers, such as mobile sources in California, are cont ributors. The commenter added that NO x emissions are a very small source of visibility impairme nt in the impacted Class I areas wh en compared to other pollutants, citing a 1996 report by the Grand Canyon Visibility Tr ansport Commission which indicates that nitrate is the source of only 4 percent of all visibility impairment in the Grand Canyon. The commenter asserted that the factor analysis must take in to account the small c ontribution of NGS NO x to overall visibility impairment in the impacted Class I areas because th is necessarily impacts the overall cost effectiveness

of the NGS BART determination. The commenter believ es that when properly c onsidered in conjunction with the cost of compliance, a proper factor 5 anal ysis clearly indicates that any marginal visibility improvement from SCR at NGS is not worth the cost.

Response:

As mentioned above, we are aware of studies showing the relative contributions of NO x and other pollutants, and the re lative contributions of vari ous pollution sources. We also noted that a BART

141 See 79 FR 26909 (May 12, 2014).

142 See Table 36 in the TSD to the Proposed Rule.

143 See document titled “NGS_emissions scenarios for modeling_2012May.xlsx” in document number 0004 in the docket for

the rule at EPA-R09-OAR-2013-0009.Page 96

EPA Responses to Comments: Navajo Gene rating Station Final Rule | July 28, 2014 determination is required under the Regional Haze Rule because our modeling, conducted according to the procedures set out in the BART Guidelines, has shown that NGS causes visibility impairment at multiple Class I areas. Controls on individual large sources are an integral part of the overall effort to reduce visibility impairment under the RHR. Ou r own CALPUFF modeling, conducted in accordance with the BART Guidelines, shows that NGS has a subs tantial nitrate impact at multiple Class I areas, and that SCR would give a substantial benefit. Th e modeling methodology and th e deciview thresholds used in assessing visibility impacts were set forth in the BART Guidelines. The BART Guidelines were subject to public comment and have already been adopted as regulation; they do not accommodate

consideration of relative contribu tions as advocated by the commenter. Our analysis of controls has

shown that SCR controls would be cost-effec tive at NGS. We disagree that the relative NO x contribution cited by the commenters excuses NGS from a BART analys is, or that it may at this late date change the visibility assessment methodology us ed in BART determinations.

Comment: EPA’s modeling overestimates visibility impact of NGS

One of the owners of NGS (0348) and the operato r of the Kayenta Mine (0384) contracted with consulting firms to review EPA’s visibility m odeling for NGS and conduct alternative modeling. The commenters submitted the resulting reports with their co mments. In each case, the reports indicated that EPA’s modeling overestimated the visibi lity impacts from emissions of NO x at NGS. An overview of the reports’ reviews of EPA modeling is presented below; greater detail on some topics is presented in subsequent comments.

The owners of NGS (0314, 0348) noted that it submitted modeling results (prepared by ENSR/now AECOM) in support of it s BART analysis in 2007 and then in 2009 after incorporating EPA

comments. The commenter stated th at EPA made a number of changes to the modeling analysis in support of its February 2013 Proposal. The commenter retained RTP Environmental Associates (RTP) to conduct a sensitivity assessment of the differences in key assumptions between the AECOM and EPA BART modeling analyses (report at tached to the comments as Appendi x V) and reported that according to RTP’s analysis, the cumulative effect of EPA’ s “conservative assumptions” is a significant overestimation of the visibility impr ovements likely to be achieved by EPA’s proposed BART controls. One commenter (0314) added that its pr evious modeling submission showed that the incremental visibility improvements from the application of SCR at NG S versus LNB/SOFA were well below 1.0 delta dv (the level considered by EPA to be humanly perceptible) at all Class I areas, and at most sites the difference was less than 0.5 delta dv (EPA’s threshol d for “contribution” to vi sibility impairment).

One of the owners of NGS (0348) quoted the RTP report submitted with the comments as saying, “ EPA has acknowledged that the modeling assumptions affect the modeled visibility benefits, but they dismiss this key point by st ating that the modeling assumptions do not change the relative ‘ranking of controls’. However, an examination of the results shows that the use of AECOM’s assumptions results

in a model predicted visibility im provement of only 0.27 [deciviews], compared to EPA’s prediction of 5.34 dv. Clearly, the assumptions do significantly affe ct the level of BART control beyond which there is no benefit (i.e., no perceptible improvement in visibility) .” The commenter included the following table (Table 8) that purports to show the impact of each of the changes that EPA made to the commenter’s initial modeling and the cumulative effect of the changes.Page 97

EPA Responses to Comments: Navajo Gene rating Station Final Rule | July 28, 2014 Table 8: Description Provided by Comment ers of EPA Changes to AECOM’s Modeling

Description of Change in Modeling Assumptions Modeled Visibility at

Grand Canyon (delta dv) Difference

ENSR/AECOM 2009 Modeling 0.27

RTP Replicate of ENSR/AECOM 2009 Modeling 0.26
Changed Extinction Calculation from Method 6 to Method 8 0.92 0.66
Changed Ammonia Background Assumptions 3.33 2.41
Changed SO 2 to SO 3 Conversion Assumed Across SCR Catalyst 3.79 0.46
Changed from Annual Average to Best 20% Days Background Visibility Conditions 4.57 0.78

Changed NO x Emission Rate from 0.055 to 0.05 lb/MMBtu 5.31 0.74
EPA Modeling Result – Scenario N7 in TSD 5.34 0.03
Cumulative Effect of All Chan ges (ENSR/AECOM 2009 vs. EPA 2013) 5.08

The operator of the Kayenta Mine (0384) retain ed JBR Environmental Consultants to review EPA’s modeling and carry out alternative modeling; the JBR report was submitted as an attachment to the comments. As summarized in the comments, th e JBR report found the following impact of what it identified as errors in EPA modeling approach:

 Elevated ammonia background concentration as sumption – increased modeled visibility improvements by 70 to 180 percent.

 Changed emissions inputs – increased modeled visibility improvements by 50 to 150 percent.

 Combined impact of ammonia background and emissions – increased modeled visibility improvements by 60 to 170 percent.

 Use of CALPUFF version 5.8 rather than 6.4 – in creased modeled visibility improvements by 5 to 500 percent.

This commenter (0384) stated that the combination of issues identified wi th EPA modeling indicates

that there are serious flaws in th at modeling, including the following:

 The variability of the CALPUFF modeling analysis requires a monitoring-based approach to verify the accuracy of the input data and avoid an arbitrary result. This applies to the emissions calculations, background ammonia levels , and assumed control efficiencies.

 EPA modeled improvement from LNB/ SOFA (the baseline) to SCR ha s not been verified in real world monitoring, or reviewed or vetted by th e modeling community, despite the proposal by SRP to EPA to conduct such monitoring.

 EPA failed to identify which modeled alternativ e it used for the final determination, while the apparent preferred analysis relied upon overly conservative assessments for all variability where only limited data existed.

Response:

Some of the issues raised in these comments are addressed be low in the responses on ammonia background concentration, CALPUFF ve rsion number, and on validation of visibility improvements viaPage 98

EPA Responses to Comments: Navajo Gene rating Station Final Rule | July 28, 2014 monitoring. Issues about emissions a nd control efficiencies are addresse d elsewhere in this response to comments (section 8.0). Aside from these issues, the comments mainly enumerate different modeling assumptions and their relative effect on the mode ling results, without ma king the case that our assumptions are incorrect. The c hoices between CALPOST visibility calculation methods 6 vs. 8 (old vs. new IMPROVE equation), and between annual average vs. best 20% natural background are examples. These commenters favor choices that yiel d lower estimated visibili ty impacts and control

benefits. Our choices reflect our best scientific and technical determin ations about what is appropriate for BART visibility assessments given the underl ying requirements of the regional haze program. 144 We also note that several of these issues are moot, b ecause even with lower ammonia concentrations “am2”, Method 6, and annual average background, the visibility benefits of SCR are s ubstantial, with seven Class I areas showing a benefit of 1 dv or more. 145

We disagree that we failed to identify the modeled alternative repres enting the proposed BART determination. We proposed a NO x limit of 0.055 lb/MMBtu ba sed on SCR performance of 0.055 lb/MMBtu with four layers of catalyst and allowing an adequate compliance margin for normal fluctuations; 146 thus, there are modeling results for only one EPA SCR control scenario presented in the Proposed Rule; 147 we stated we relied on 1 ppb ammonia b ackground, visibility Method 8, and 20% best days natural background. 148 This unambiguously identifies the CA LPUFF modeling scenario we relied on. Relating that scenario to the specific inputs and CA LPUFF file names requires reviewing the TSD and our supporting spreadsheets. One spreadsheets showed control scen ario N2 with SCR and the four catalyst layers (giving an SO 2 to SO 3 conversion rate of 0.67%), in a specific spreadsheet. 149 Another spreadsheet identified scenario N2 as the one used in the tables in the Proposed Rule. 150 This unambiguously identifies the CALPU FF modeling scenario and inputs we relied on; the corresponding

CALPUFF files all have “n2” in their names.

We also disagree with one commenter’s charac terization of “no perceptible improvement in visibility” as synonymous with “no benefit.” A cont rol that by itself does not provide a perceptible improvement may still provide a benefit by combining with other controls to provide a perceptible improvement. In any case, human per ceptibility is not a requirement for BART controls. As stated in the

BART Guidelines:

Even though the visibility improvement from an individual source may not be perceptible, it should still be co nsidered in setting BART because the contribution to haze may be significant relative to other source contributions in the Class I area. Thus, we disagree that the degree of improvement should be contingent upon perceptibility. Fai ling to consider less-than-perceptible contributions to visibility impairment would ignore the CAA’s intent to have BART requirements apply to sources that contribute to, as well as cause, such impairment. 151

144 See page 92 in the TSD to the Proposed Rule, document 0014 in the docket for the rule at EPA-R09-OAR-2013-0009.

145 See supporting spreadsheet in docket titled “NGS_RHFIP_T SD_vis_tables_121203.xlsx”, with settings “vm6a” and “am2”, in document number 0004 in the docket for the rule at EPA-R09-OAR-2013-0009.

146 See 78 FR 8280 and 8288 (February 5, 2013).

147 See Table 9, 78 FR 8287 (February 5, 2013).

148 78 FR at 8286 (February 5, 2013).

149 Cited on page 122 of the TSD, referencing document title d “NGS_BART_Scenarios_Emissions_EPA_proposal.xlsx”, in

document 0004 in the docket for the rule at EPA-R09-OAR-2013-0009.

150 Cited on page 35 of the TSD, refere ncing document titled “NGS_RHFIP_TSD_vis_tables.xlsx” in document 0004 in the

docket for the rule at EPA-R09-OAR-2013-0009.

151 BART Guidelines at 70 FR at 39129 (July 6, 2005).Page 99

EPA Responses to Comments: Navajo Gene rating Station Final Rule | July 28, 2014 No one control will be sufficient to achieve the visi bility goals of the RHR; the effect of reasonable controls on the many contributing sources will cumula tively enable progress towa rd those goals. In any case, our modeling results show that there wi ll be a perceptible visibility benefit.

Comment: EPA used background ammonia concen trations that were too high

Two of the owners of NGS (0314, 0348), an indu stry trade association (0306), and the operator of the Kayenta Mine (0384) indicated that EPA’s assumed ammonia background concentration of 1 part per billion (ppb) is unrealistically hi gh compared to measured values in the area, resulting in artificially high model projections.

One of the owners of NGS (0348) stated that assumptions rela ted to the background concentration of ammonia played what the commen ter categorized as “the biggest role in overpredicting visibility benefits,” causing a differe nce of 2.41 dv at the Grand Canyon between EPA’s and

the commenter’s estimates. The commenter noted th at EPA used a default constant of 1.0 parts per billion (ppb) for background ammonia concentration, wh ich the commenter believes fails to account for known variations in monthly or seasonal ammonia concentration.

This commenter (0348) cited the 2012 NREL analysis and an analysis carried out at the commenter’s request by AECOM and Dr. Ivar Tomb ach (which was submitted by the commenter in response to the 2009 ANPR and attached to the pres ent comments as Appendix E) as concluding that assumed ammonia concentrations are very important in the NGS modeling, particularly in the winter

months. The commenter also noted that the To mbach study compared modeled predictions of ammonium nitrates using both EPA’s and AECOM’s ammonia background concentrations to measured
ammonia values, with the result s demonstrating that the EPA’ s assumptions result in over predictions of actual measured values by a factor of 10 or more in some cases. The NREL analysis reached a similar conclusion, apparently based on review of the To mbach study. The commenter indicated that while modeling is supposed to be cons ervative, such a significant over prediction is well ou tside the bounds of reasonable conservatism, particularly when such a si gnificant financial investment will be made based

on the results. The commenter asserted that the Tombach study clearly dem onstrates that AECOM’s ammonia background assumptions are much more a ppropriate model inputs for the purpose of the visibility modeling assessment.

The same commenter (0348) stated that EPA esse ntially ignored this anal ysis in the February 2013 Proposal and continued to use a constant amm onia background of 1 ppb, which is the default value recommended by the Interagency Workgr oup on Air Quality Modeling (IWAQM). 152 The commenter noted that when this IWAQM guidance was issued 14 years ago, CALPUFF did not have the capability of accommodating monthly ammonia background concentrat ions as it has since been updated to do. The

commenter asserted that EPA’s reliance on a consta nt value is an outdated approach that is not scientifically credible. The commenter added that EP A has not always relied on a constant value, citing EPA’s July 1, 2008, modeling protocol approval letter (attached to th e comments as Appendix B) in which EPA accepted varying ammonia values proposed by the commenter that had previously been accepted by the EPA and the Federal Land Managers in other recently issued permits in the region.

152 Interagency Workgroup On Air Quality Modeling (IWAQM ) Phase 2 Summary Report And Recommendations For Modeling Long Range Transport Impacts (EPA-454/R-98-019), EP A OAQPS, December 1998, http://www.epa.gov/scram001/7t hconf/calpuff/phase2.pdfPage 100

EPA Responses to Comments: Navajo Gene rating Station Final Rule | July 28, 2014 The commenter (0348) conclude d that the use of a higher ba ckground ammonia concentration results in the prediction of higher visibility impair ment by CALPUFF and, all ot her things being equal, has the effect of inflating the estim ated benefit of more stringent NO x control options. The commenter believes that the use of AECOM’s ammonia backgr ound concentrations results in more accurate CALPUFF predictions and is the be st scientific approach for th e visibility modeling conducted in support of the BART determination.

The operator of the Kayenta Mine (0384) made similar points. The commenter noted that the EPA used the IWAQM default background ammonia value of 1 ppb, but quoted the IWAQM as saying “[g]iven all the uncertainties in ammonia data, IW AQM recommends use of levels presented above, unless specific data are available for the modeli ng domain that would discredit the value cited.” According to the commenter, measurements on the Colorado Plateau submitted by SRP show actual ammonia values that are significantly lower than the IWAQM default value. 153 The commenter also quoted the NREL report’s statement that EPA’s m odeling using higher ammoni a values resulted in

modeled ammonia nitrate concentrat es an order of magnitude higher than measured values for many cases, while the use of the SRP ammonia backgr ound values produced a better comparison between

modeled and measured values.

This commenter (0384), citing the JBR report su bmitted with the comments, criticized the “back calculation” method used by EPA to validate the a ssumed background concentra tion, stating that this method is based on theoretical atmospheric chemistry fo r which monitoring data is not available and it is

unclear whether the method reflects the actual atmospheric processes that occur. The commenter also

stated that the back calculation method has not been vetted by the atmospheric modeling community or used in similar BART analysis prior to NGS.

The same commenter (0384) stated that EPA’s assumed ammonia levels increased the modeled deciview improvements due to installation of SC R by 70 to 180 percent. The commenter gave an example from the JBR report where using the SRP ammonia background levels and the same remaining inputs as EPA results in a change of 1.3 dv fo r the Grand Canyon, while using the EPA ammonia background levels results in a change of 2.7 dv, which is more than twice the SRP results.

The industry trade association (0306) stated that EPA’s refusal to consider the ammonia monitoring data, on the basi s that the QA/QC was not fully up to EPA’s preferred leve l, is arbitrary

because there is even less data to support the regulatory default as app lied to NGS than there is to accept the monitoring data. Thus, according to the comment er, while it may be appropriate to caveat the analysis somewhat – perhaps by using a seasonal av erage ammonia value – there is no principled technical basis for refusing to consider the monito red background ammonia levels altogether as EPA has

done. The commenter believes that the effect of EP A’s use of cumulative visibility impact values (discussed further below) and refusal to use monito red ammonia background valu es is to overstate the benefit of the proposed BART determ ination, and that if the EPA were to use “actual” values it might

reach the conclusion that an alternative control st rategy best meets the requirements of CAA section

169A.

Response:

153 Citing Measurements of Ambient Background Ammonia on the Colorado Plateau and Visibility Modeling Implications , I. Tombach and R. Paine, Report by SRP September 2010 submitted to EPA in 2010 and cited by West Associates comments on EPA Proposed Rule for Four Comers Plant, EPA-R09-0AR-2013-0498.Page 101

EPA Responses to Comments: Navajo Gene rating Station Final Rule | July 28, 2014 On the issue of CALPUFF ammonia background concentration, we considered the arguments and data provided by commenters, who generally advoc ated lower monthly varyi ng values in place of EPA’s constant 1 ppb, the default for arid la nd from the IWAQM document. These comments are largely the same as those provided on EPA’s BA RT proposal for the Four Corners Power Plant, including some of the same attached technical re ports. EPA has decided to retain the IWAQM default for three main reasons. First, the case for 1 ppb bei ng an overestimate is not as strong as the commenters contend, especially for the BART regulatory context, based on bot h ammonia itself and on ammonium nitrate model predictions. Second, th e variability of available ammoni a monitoring data does not allow

for a clear alternative to the defa ult. Third, even when the lower ammonia values advocated by some commenters are used, the visibility improvements due to SCR on NGS remain substantial, so that the particular choice of ammonia background does not cha nge EPA’s determination that SCR is BART for

NGS.

Before responding to the substantive issue, we no te that the July 1, 2008 letter from EPA to SRP was not a “BART Modeling Protocol Approval Letter”, as it was charac terized in Appendix B to SRP’s comments. Rather, the letter was an amendment to an earlier information request, withdrawing the specific request that SRP explore alternative ammonia levels. Admittedly, we did refer to the SRP levels (0.2 – 1.0 ppb) as “appropriate”. However, the cont ext was not submittal of a modeling protocol for EPA approval. This letter was sent before the USDA Forest Service aler ted us to higher ammonia values measured in the Four Corners Area, as described in the TSD. In any case, we disagree that EPA

committed to use the same ammonia concentrations used by SRP’s contractor in our own modeling analysis for our BART determination.

Even though the specific ammonia background values used are moot for the NGS BART determination, as discussed below, the comments advo cating lower values deserv e to be addressed. We note that we already addressed these i ssues to varying degrees in the TSD 154 for the NGS proposal (“NGS TSD”, e.g. section 7.G.3. “Ammonia B ackground Levels”), the TSD 155 for the Four Corners Power Plant (FCPP) BART proposal (“FCPP TS D”, section 7.G.1, “Ammonia Background Values”), and the Response to Comments 156 for the Four Corners Power Plan t BART final action (“FCPP RTC”, section 7, 2nd comment).

As mentioned above, our first reason for r eason for retaining the 1 ppb IWAQM default

ammonia concentration is that the case for using lower ammonia backgr ound values is not as strong as argued by the commenters. This applies both to the measured ammonia data itself, and to CALPUFF predictions of nitrate using vari ous ammonia levels as input. Much of the existing measured data cited by the commenters 157 is from more distant states, and so may not be representative for evaluating visibility impacts from NGS. Further, the meas urements sometimes comprise only ammonia (NH 3 ) itself, and not ammonium (NH 4 + ); or if it does include ammonium , that fact is not cited by the

154 “Technical Support Document, Proposed Rule: Regional Haze Requirements for Navajo Generating Station: Navajo Nation”, Docket Number: EPA-R09-OAR-2013-0009. EPA Region 9, rev. February 11, 2013.

155 “Technical Support Document, Proposed Rule: Source Speci fic Federal Implementation Plan for Implementing Best Available Retrofit Technology for Four Corners Power Plant: Navajo Nation”, Docket Number: EPA-R09-OAR-2010-0683. EPA Region 9, October 10, 2010.

156 “Response to Comments for Proposal and Supplemental Pr oposal: Source Specific Federal Implementation Plan for Implementing Best Available Retrofit Technology for Four Corners Power Plant: Navajo Nation”, Docket Number: EPAR09-OAR-2010-0683. EPA Region 9, August 2012.

157 E.g. SRP comments appendix G, “Measurements of Ambien t Background Ammonia on the Colorado Plateau and Visibility Modeling Implications”, Prepared by Salt River Proj ect, Contributors: Ivar Tombach and Robert Paine, September

2010. Referred to here as “SRP monito ring report”, or Tombach & Paine 2010.Page 102

EPA Responses to Comments: Navajo Gene rating Station Final Rule | July 28, 2014 commenters. Visibility-impairing ammonium sulfate and ammonium nitrate are formed from ammonia,

SO 2 , and NO x . Therefore the ammonium represents part of the pool of ammonia that could be available

to interact with the SO 2 and NO x from a facility and contribute to visibility impacts, and should be accounted for in estimating ammonia background concentr ations. In several of th e research papers cited by commenters, the amount of measured ammonium is comparable to and at times much greater than the

amount of ammonia. 158 Measurements made by SRP in Decem ber 2009 – April 2010 closer to NGS did

include both NH 3 and NH 4 +

. 159 .Depending on time and location, typical NH 3 ranged from 0.2 ppb to 0.8 ppb. If the measured NH 4 is converted to ppb and added to this, then the to tal is 0.6 – 1.2 ppb, considerably higher than the 0.2 ppb wint er values used in SRP’s modeling, 160 and thus these measurements are a weaker argument against EPA’s de fault than claimed by the commenter. It is true that under current conditions, some of the ammonia in the form of NH 4 is not available to interact with pollutants from NGS, as it has already interacted with pollutants from other sources (this is more true of

ammonium sulfate than of ammonium nitrate, since th e latter can more readily decompose to nitric acid and free ammonia). However, it can be argued that for purposes of a ssessing NGS impacts relative to natural background, per the BART Guid elines – that is, without impairment from other anthropogenic

sources – both ammonia and ammonium should be assu med to be available to interact with emissions from NGS. In reality, the proportion of measured ammonia and ammonium that is available for reaction is not known. The proportion depends on the key assu mption of whether other anthropogenic sources should “count”, and also on the location and timing of ammonia emissions, varying temperature and humidity, and the particular path of the NGS plum e. The sum of ammonia and ammonium provides an upper bound estimate of the ammonia background, and a conservative estimate for modeling. Using just the ammonia measurements cited by the commenters w ould neglect this altogether , so their argument for lower ammonia values does not persuade us to change our determination to use the 1 ppb IWAQM

default.

Even apart from the complications on the availability of ammonium (NH 4 + ), there are measurements of gaseous ammonia (NH 3 ) that by themselves are close to or greater than 1 ppb, even in

winter. Winter measurements included in Sather et al. 161 (which EPA relied on for modeling of impacts at Mesa Verde NP) ranged from 1.1 ppb to 1.8 ppb for a monitor at the Farmington Airport in northwestern New Mexico; since these were 3-week av erages, the value for individual days would have been higher still. Winter 2011-2013 meas urements from the AMoN network 162 range from 1.1 to 1.3 ppb for Farmington, and 0.7 – 0.9 ppb for Chiricahua, in sout heastern Arizona. These va lues are greater than

158 RoMANS - Rocky Mountain Atmosp heric Nitrogen & Sulfur Study , William C. Malm and Jeffrey L. Collett. National Park Service, CSU-CIRA, Fort Collins, CO . ISSN 0737-5352-84. October 2009. http://www.nature.nps.gov/air/Studies/roman s.cfm Table 3.9, p.3-38 shows ammonium comparable to or about half of ammonia, depending on measurement method, Table 3.10 p.3-39 shows maximum ammonium to be about 0.57 μg/m 3 or 0.77 ppb and maximum ammonia to be about 1 μg/m 3 or 1.4 ppb; sum of these is about 2.2 ppb. “NH 3 Monitoring in the Upper Green River Basin, Wyoming”, by John V. Molenar, H. James Newell, Jeffrey Collett, et al. Extended Abstract #70, A&WMA Specialty Conference “Aerosol & Atmospheric Optics: Vi sual Air Quality and Radiation”, Moab, Utah, 28 April - 2 May 2008, p.3 Figure 1 and p.4 Figure 3 show ammonium comparable to ammonia in summer and far greater in winter. “Aerosol Ion Characteristics During the Big Bend Regional Ae rosol and Visibility Observational Study,” Taehyoung Lee, Sonia M. Kreidenweis & Jeffrey L. Collett Jr. Journal of the Air & Waste Management Assoc. vol.54, issue 5, 2004, pages 585-592. DOI:10.1080/10473289.2004.10470927, Table 1 p.587 shows ammonium about four times as high as ammonia.

159 SRP monitoring report, or Tomb ach & Paine 2010, cited above.

160 SRP comments Appendix C. “Revised BART Analysis for the Navajo Generation Station Units 1-3” (January 2009) and Appendix I. “Visibility Modeling Using Upgr aded CALPUFF Model” (February 2011)

161 Mark E. Sather et al. , 2008. “Baseline ambient gaseous ammonia c oncentrations in the Four Corners area and eastern Oklahoma, USA”. Journal of Environmental Monitoring, 2008, 10, 1319-1325, DOI: 10.1039/b807984f.

162 Atmospheric Ammonia Network, National Atmospheric De position Program, http://nadp.sws.uiuc.edu/amon/; data available in docket spreadsheet “AMoN_network_AZ_NM_NH3_average.xlsx.”Page 103

EPA Responses to Comments: Navajo Gene rating Station Final Rule | July 28, 2014 or comparable to the 1 ppb IWAQM default used by EPA, which thus appears to be a reasonable

intermediate between these measurements and th e lower values cited by commenters. In addition, regarding the ammonia statements in the NREL study 163 cited by some commenters, the National Park Service pointed out in a letter 164 to EPA that the ammonia concentr ations cited are generally seasonal averages. The NPS stated that short term (24-hour) am monia average concentrations in these studies are consistent with the values used by EPA, and that the latter were appropriate for 24-hour visibility impairment assessments (such as the BART modeling using CALPUFF, which provides 24-hour average visibility estimates).

Turning from measured amm onia data to nitrate (NO 3 ) model predictions based upon them, again we disagree with the commenters. Several co mmenters stated that the EPA default 1 ppb ammonia levels lead to overprediction of nitr ate concentrations relative to what is observed at monitors; they cite work by Scire et al. in 2003 165 and 2010 166 and the 2009 SRP comments on the ANPR, included as appendices D and E of SRP’s comments on the present action. We do not believe the approaches used in these studies are appropriate for BART modeling, and we do not believe their re sults make it appropriate to change the ammonia levels us ed in our BART modeling. The Scir e work modeled western Wyoming,

so its conclusions about ammonia-ba sed overpredictions cannot be direct ly carried over to locations in

Arizona and the Four Corners area: ammonia levels that give better model performance in Wyoming may not apply to location relevant for NGS. In a ddition, the CALPUFF modeling in that work was not single-source modeling like that done for BART de terminations: it involved 1776 sources altogether, with many point, area, and mobile sources. In th e scenarios cited by the commenters, all of the background ammonia appears to have been assumed to be available for nitrate production by all of those sources simultaneously, so it is pe rhaps not surprising that nitrat e was overpredicted. A POSTUTIL

NO 3 /HNO 3 repartitioning step may have been app lied, allowing for some competition for ammonia between overlapping source plumes, but even then th e assumption of 1 ppb everywhere for all source plumes would strongly accentuate any CALPUFF te ndency toward overprediction. In any case, the approach was quite different than BART mode ling, where only a single source’s emissions are interacting with the ammonia; overp redictions in the multi-source exercise do not directly apply to the single source case. So again, this study’s ammonia its conclusions do not carry over to single-source CALPUFF modeling for NGS BART. Als o, both Scire studies also seem to be based on average nitrate, rather than the higher concentrations that would be of more regulator y concern. Further, the objectives

of the two studies were not evaluation of ammonia levels per se, but rather the showcasing of new CALPUFF model changes that c ould improve performance in some circumstances. The 2003 work compared standard CALPUFF using constant amm onia levels against CALPUFF using an Ammonia Limiting Method (ALM, a method for accounting for multiple sources’ competing for available ammonia) and a Boundary Condition Module (using tim e-varying inflow boundary concentrations). The

163 Navajo Generating Station and Air Visibility Regulations: Alternatives and Impacts , David J. Hurlbut, Scott Haase, Gregory Brinkman, Kip Funk, Rachel Gelm an, Eric Lantz, Christina Larney, Davi d Peterson, Christopher Worley (NREL) and Ed Liebsch (HDR Engineering, Inc.), January 2012, NREL/TP-6A20-53024, produced under direction of the U.S. Department of the Interior under Interagency Agreement R11PG30024. Report and Compendium available at http://www.doi.gov/navajo-gss/index.cfm. In docket as: “201 2-03 NREL Report”; also included as Appendix L to SRP

comments.

164 Letter from Herbert C. Frost, Ph.D., Associate Director, Na tional Resources Stewardship and Science of the National Park Service, to Jared Blumenfeld, April 6, 2012. In docket as: “2012_0406 NPS Letter to EPA” in document number 0004.

165 Scire et. al. 2003. “Evaluation of the CALPUFF Model in Pr edicting Concentration, Visibility and Deposition at Class I Areas in Wyoming”. Presented at the AW MA Specialty Conference: Guideline on Air Quality Models: The Path Forward. Mystic, Connecticut, Oct. 23-24, 2003.

166 “New Developments and Evaluations of the CALPUFF Model” , Joseph S. Scire, David G. Strimaitis, and Zhong-Xiang Wu, March 14-16, 2012, 10th Conference on Air Qua lity Modeling, RTP, North Carolina. Available at http://www.epa.gov/ttn/scr am/10thmodconfpres.htm.Page 104

EPA Responses to Comments: Navajo Gene rating Station Final Rule | July 28, 2014 2010 work focused on a new CALPUFF version, 6.42, incorporating a different treatment of atmospheric chemistry than the regulatory CALPUFF version, 5.8 (the issue of using an updated version

of CALPUFF version is discussed below in the response to comments on that specific issue). The two studies did show comparisons of monitored nitrate data against CALPUFF predictions using 1 ppb ammonia, but were not an explorati on of what ammonia value is best to use with the regulatory version

of CALPUFF in BART assessments. This is not to discount the Scire work, which provided important insights and should be examined carefully as we c onsider changes to the ap proved version of CALPUFF and also the regulatory context in which it is used. However, th e different locati on and different methodology used in the studies do not provide a basis for us to change our de termination to use the 1 ppb IWAQM default.

Appendix E to the SRP comments has a thorough set of comparisons of measured nitrate concentrations at the Grand Canyon against modeled pr edictions using the SRP ammonia levels of 0.2 to 1.0 ppb, and using the EPA ANPR levels of 0.7 to 1.0 ppb. 167 The main comparisons are in that appendix’s section 3, “Evaluating the EPA’s Back-Calculation Method” . Three analysis methods are used: comparison for particular days ( e.g. Figures 3 and 4), comparison of the overall distributions of

NO 3 values ( e.g. Figure 5, cumulative percentiles), and ranked comparisons ( e.g. Figure 7, plotting the highest predicted against the highe st measured, the 2nd highest agains t the 2nd, and so on; also called a “Q-Q plot”). For predictions based on EPA ANPR M ammonia levels, the graphics for the three respective methods show that various individual days have nitrate higher than observed values, that the overall distributions are higher than observed, and likewise for most of the ranked values, again except for the very highest ones. Conversely, the graphics also show that predictions based on the SRP

ammonia levels are lower than the observed. These SRP conclusions are compatible with some nitrate comparisons performed by EPA and described in the NGS TSD (p.120 ff

). We plotted time series of daily nitrate concentrations for several m odeled receptor locations in the Grand Canyon 168 , and concluded that nitrate predictions we re somewhat high in that high values occurred more frequently than in the measured IMPROVE data, but that predicted ma xima were in the range of maxima seen in the

measured data. Predictions based on the SRP values appeared to be too low to explain the observed maxima. Additional tests were performed for the F our Corners Power Plant nitrate impacts, and found that the EPA ANPR values gave fairly good agreemen t at the highest concentrations, such as the maximum and the 98th percentile. The 98th percentile of deciview visibility impacts is the metric used for BART assessments under the BART Guideline. Our main conclusion from the various comparisons is that at the highest concentrati ons, which are of most regulatory inte rest, the ammonia values we used are appropriate.

In sum, commenters presented some evidence th at ammonia concentrations at some times and places are lower than the 1 ppb default we used fo r CALPUFF background. However, considering that there are also higher measured ammonia concentrati ons, that some of the nitrate comparisons are not directly applicable, and that there is reasonable agr eement with nitrate measurem ents at the levels of regulatory interest, we do not find the evidence compelling enough to choose ammonia levels different than the IWAQM guidance default values.

167 The “SRP levels” were developed by AECOM and advocated by SRP; the ANPRM called these scenario “am1”, while the present action they are called scenario “am2”. The “EPA AN PRM levels” were ANPRM scenario “am3”, derived using a previous version of EPA’s back-calculation approach; they did include a single month with 1.3 ppb. With that one exception, these previous values are the same or lower than the present EPA default of 1 ppb, depending on the month. Therefore, SRP conclusions that those old levels were too high would also apply to the present action’s 1 ppb levels.

168 EPA nitrate plots are available in docket spreadsheet title d “NO3_compare_ANPRM.xlsx”, see document number 0004 in

the docket for this rule at EPA-R09-OAR-2013-0009.Page 105

EPA Responses to Comments: Navajo Gene rating Station Final Rule | July 28, 2014 A second reason for retaining th e 1 ppb IWAQM default ammonia concentration is that the variety of ammonia concentrations measured at various times and places do not point to a clear alternative constant value, nor to an alternative monthly varying scheme. It is not that we are refusing to use ammonia measurements (whether for QA/QC or other reason), as claimed by some commenters. Rather, our consideration of the avai lable data and other studies leads us to conclude that there is not a technically justified alternative to using the IWAQ M default. As cited above , there is a variety of

ammonia values measured at different times and places, and sometimes with different methodologies. Even the SRP monitoring report (Tombach & Pain e, 2010, cited above) describes a surprisingly high spatial variability in ammonia conc entrations. The two monitors in the Cameron area south of NGS (and east-southeast of the Grand Canyon) showed consistent concentration differences despite being less than five miles from each other. This difference may be due to relatively localized ammonia sources, though

these were not identified. These sites also showed consistently lower measurements than the Hall’s crossing site, north of NGS (and southwest of Capito l Reef). Because of the variability and its unknown causes, the data collected did not lead to a clear picture of appropriate a nd representative ammonia background concentrations to use wi th CALPUFF. The variability seen within the SRP study, as well as

that between the various other studi es and sites, underscores the diffi culty in choosing representative ammonia background concentrations The choice of background ammonia for CALPUFF modeling might consider ambient ammonia near NGS and trave ling along with its pollutant plume, as well as ammonia inflow and ammonia emissions the plume en counters as it travels. Yet measurements of ammonia are spatially sparse; the sources of amm onia are not well characterized, and the amount and

variation of their emissions are not well known. Also relevant for choosing an appropriate background are decisions made in the regulatory context on whether to use short-term (24-hour) or monthly averages, whether just the maximum or 98th percentile or some other portion of predictions are most important, and the degree to which competition for ammonia from other, existing sources should be included. In the face of all this uncertainty, it is mo st supportable to use the default values from the IWAQM document, the only guidan ce available on this issue.

The third main reason for retaining the 1 ppb IWAQM default is that alternative lower assumptions do not change EPA’s BART determination, because CALPUFF modeling 169 of SCR shows substantial visibility benefits even using the alte rnative assumptions. For SCR (modeling scenario “f1”,

with NO x emissions at 0.055 lb/MMBtu), under EPA’s IWAQM 1 ppb ammonia assumption (“am1”), the maximum benefit of SCR is 5.4 dv at Capitol Reef NP, and the cumulative benefit over all 11 Class I

areas is 35.5 dv. Ten areas see a bene fit greater than 1 dv, and eight see a benefit greater than 2 dv. By contrast, under the ammonia assu mption advocated by some comment ers (“am2”, ranging from 0.2 ppb in winter to 1.0 ppb in summer), the maximum benefit of SCR is 2.3 dv, and the cumulative benefit is 15.7 dv; these are less than half of the “am1” results. Nine areas see a benefit greater th an 1 dv, and one sees a benefit greater than 2 dv (two more areas s ee benefits of 1.9 dv); these are fewer than the areas showing such benefits under “am1”. While these “am2” benefits are clearly lo wer than those using the “am1” IWAQM default assumption, they are still quite large. Thus, even if we agreed with all the commenters’ objections to the ammonia values we us ed, the visibility benefits still provide ample justification for the EPA determin ation that SCR is BART for NGS.

One additional ammonia background issue was ra ised by commenters, that of EPA’s “backcalculation” method of estimating a mmonia concentrations. This issue was addressed in the NGS TSD, section E.2 and G.3. and especially in the FCPP RTC, the second comment in section 7. The method

uses sulfate and nitrate measured at Class I areas, and estimates the amount of ammonia that must have been present to neutralize those chemical species (which are in the form of ammonium sulfate and

169 Full modeling results are available in the docket in the spreadsheet titled “NGS_RHFIP_NFR_vis_tables.xlsx”.Page 106

EPA Responses to Comments: Navajo Gene rating Station Final Rule | July 28, 2014 ammonium nitrate). This method was suggested by the USDA Forest Service, and endorsed by the National Park Service. EPA used the method only to he lp corroborate the results of the 1 ppb default. No one has claimed the method is an ideal one, but it is an objective method based on measured data, and one that we expect to provide an estimate of the upper bound of available ammonia. In the NGS TSD and the FCPP RTC we explain some of the counterbala ncing factors affecting the method; we continue to believe it provides an estimat e worth considering. We believe it corroborates the modeling results based on the 1 ppb IWQAM default we are mainly relying upon. Interestingly, despite the strong criticism of the method offered by some commenters, especially SRP, the method’s ammonia estimates for the Grand Canyon in December - April are fairly clos e to those seen in the SRP monitoring study at its Gray Mountain and Moenkopi Switchyard monito ring sites, around 0.5 to 0.6 ppb. In any case, we believe that the modeled visibility benefits from SCR that result from these lower ammonia concentrations remain large, and provide justification for the EPA determination that SCR is BART for

NGS.

Comment: Invalid definition of “natural visibility”

The operator of the Kayenta Mine (0384) stated th at the RHR does not define “natural visibility” in terms of the best 20 percent days. The comment er quoted the BART Guidel ines and additional EPA guidance 170 to conclude that “natural visibility conditions represen t a long term average condition analogous to the 5 year average best and worst day conditions that ar e treated under the regional haze program.” The commenter also noted that the BART Gu idelines provide that in determining if a control results in improved visibility, the implementing agency should use the same approach used to determine if the source was subject to a BART analysis.

The commenter (0384) contended that EPA based its analysis on only the best 20 percent days rather than the average (citing 78 FR 8286), despite wh at the commenter believes is direction to base the analysis on the “5 year average best and wors t day condition.” According to the commenter, EPA justified this approach based on an internal EPA memo that opined that the EPA can use either the annual average background conditions or the average of the best (cleares t) 20 percent of days (citing 78 FR 8286, fn. 56). The commenter noted that this distinction is important because under cleaner visibility conditions, relatively less pollution will cause per ceptible changes than under more polluted background

conditions. 171 The commenter stated that it is thus possible that NO x emissions from NGS could result in perceptible changes under the “bes t 20 percent days” while under aver age condition that same level of

NO x emissions would not.

The commenter (0384) opined that EPA cannot modify the appro ach provided for in the RHR and BART Guidelines and equate the best 20 percent of days to “natural visibility,” and that until the EPA conducts an appropriate analysis based on the av erage rather than the be st 20 percent of days, it cannot conclude that requiring NGS to add SCR to the existing LNB/SOFA controls will result in any humanly perceptible improvement in visibility at the Class I areas in question. According to the commenter, EPA is in essence changing the requireme nt to improve the worst 20 percent of days to improve the best 20 percent of days, which is not wh at the RHR requires. The commenter asserted that the failure to conduct appropriate m odeling is a failure to comply with the mandatory BART factors and

the RHR and Clean Air Act.

170 Guidance for Estimating Natural Visibility Conditions under the Regional Haze Program , September 2003 (EPA 454/B03-005).

171 Citing Interagency Working Group on Air Quality Modeling (IA WBM) Phase 2 Summary Report , December 1998, EPA 454/R-98-019, p. 23.Page 107

EPA Responses to Comments: Navajo Gene rating Station Final Rule | July 28, 2014 Response:

We disagree with the commenter that our BART modeling used an inap propriate definition of natural visibility. We are not aware of any require ment to use average natural conditions in BART modeling. The EPA document cited by the commenter, Guidance for Estimating Natural Visibility Conditions Under the Regional Haze Program , states “natural visibility conditions represents a longterm average condition analogous to the 5-year average best-and worst- day conditions that are tracked under the regional haze program” (sec.1.2, p.1-1). We agree with the commenter that this is consistent with RHR requirements. BART is one mechanism th at the RHR provides for meeting the RHR goals, but it does not follow that the speci fic metric used to assess progre ss under the RHR must also be used

for individual source assessments. The BART Guidel ines state “Finally, these final BART guidelines use the natural visibility baseline for the 20 percent be st visibility days for comparison to the ‘cause or contribute’ applicability thresholds . We consider this estimated base line is likely to be reasonably

conservative and consistent with the goal of natural conditions.” 172 In a subsequent memorandum, EPA

stated that States could use either the best 20 percent of days or the annual average, but far from imposing the average as a requirement, the memo offe red it as an optional alte rnative to the best 20 percent that is mentioned in the BART Guidelines. 173 The BART analyses in many States’ plans used the average, which makes the impact of the source appear smaller (the adde d pollution does not show up as much against a dirtier background). While states are free to take this approac h, the best 20 percent of days is consistent with available guidance and with th e goals of the RHR, and we consider it appropriate for this action. Finally, however one may interpret the various documents cited by the commenter, we note that although the guidance document provides vari ous recommendation, it is not fully prescriptive for BART modeling, and indeed does not contain a ll the natural condition i nputs required for BART modeling using CALPUFF, as we disc uss next. In any case, the natural visibility conditions we used in modeling NGS were consistent with the gui dance document and the BART Guidelines.

The Estimating Natural Visibility guidance is aimed at setting natural visibility and reasonable progress goals, and is not fully prescriptive fo r BART modeling. After defining natural conditions, under “What is the purpose of the Guidance for Es timating Natural Visibility Conditions Under the Regional Haze Rule?” the guidance go es on to say “As part of the program, States will develop goals and implement strategies for improving visibility in each mandatory Federal Class I area. Estimates of natural visibility conditions are ne eded by the States for the goal de velopment process. ” Its various subsections deal with aspects of those goals, and not with modeling. In any case the document does not provide the full set of natural co ncentrations needed to run CALPUFF. The document does not mention CALPUFF at all, and its only expl icit modeling recommendation is in Appendix A, which covers f(RH) relative humidity factors to use in conjunction with the IMPROVE e quation for translating pollutant

concentrations into extinction. 174

Apart from the relative humidity factors reco mmendations, the specific natural concentrations that are provided in the document are also not pr escriptive or complete because they are not areaspecific. The guidance document describes a “Def ault Approach to Estimating Natural Visibility Conditions”, which includes Table 2-1, “Average Na tural Levels of Aerosol Components” (sec.2, p.2-2)

172 70 FR 39125 (July 6, 2005).

173 “Regional Haze Regulations and Guidelines for Best Available Retrofit Technology (BART) Determinations”, memorandum from Joseph W. Paisie, EPA OAQPS, July 19, 2006. In the docket as: 2006_07_19 EPA Memo on RH BART

Determinations.

174 The appendix states: “Thus, the 12 monthl y-averaged f(RH) values de termined in this way for each Class I area should be used for all aerosol speciation data or model predictions for that location.” (p.A-3).Page 108

EPA Responses to Comments: Navajo Gene rating Station Final Rule | July 28, 2014 This table gives default annual average concentra tions of several visibili ty-impairing particulate pollutants, with one set for the East and one set fo r the West. These might be assumed to be default

concentrations for use in CALPU FF modeling, though that is not expl icitly stated. However, as suggested by guidance section title’s phrase “default approach”, these natural concentration values are better used just as a starting point . It is more appropriate to use area-specific concentrations for modeling, because Class I areas do in fact differ from each other. It is also appropriate because only area-specific concentration values can be consistent with the area -specific extinction and deciviews recommended in Appendix B to the guidance document.

Finally, the guidance document is not prescriptive or complete because its natural concentrations in the guidance document are annual averages. Their use in BART mo deling would not be consistent with the majority of the guidance te xt’s focus on 20 percent worst and 20 percent best days, nor with the BART Guideline’s recommendation of the best 20 per cent natural conditions. As described in the TSD (p.93), we used a scaling procedure to adjust the guidance document’s natura l concentrations to be proportional to the best 20% extinc tion values it provide s. In summary, our pr ocedure resulted in concentrations consistent with the multiple aspect s of the guidance document, but also usable in CALPUFF modeling. We believe that the natural visi bility conditions we used in modeling NGS were consistent with the guidance document, the BART Guidelines, and the RHR.

Comment: Other studies indicate there will be no perceptible improvement in visibility

The operator of the Kayenta Mine (0384) stated that the addition of SCR will result in no perceptible improvement in visibility. The comment er asserted that under the RHR, the degree of improvement that must be shown under this BART f actor is one of humanly perceptible improvement. The commenter indicated that multiple studies and ot her modeling demonstrate that there will be no perceptible improvement in visibility:

 The NREL report, which stated that it “is inc onclusive as to whethe r removing approximately

two-thirds of the current NO x emissions from NGS would lead to any perceptible improvement in visibility at the Grand Ca nyon and other areas of concern.”

 A study on the Mohave Power Project (MPP, also known as the Mohave Generating Station, or MGS) closure that found “virtually no evidence th at the MPP closure improved visibility in the Grand Canyon.” (Additional detail is in cluded in a subsequent comment.)

 Modeling conducted by the Salt River Project (S RP), a co-owner and the operator of NGS,

which was submitted with its BART determination.

 Comments submitted by the Central Arizona Water Control Distri ct (CAWCD) on the 2009 Advanced Notice of Proposed Rulemaking (ANPR) for FCPP and NGS, which indicated that an earlier modeling study conducted by ENVIRON found that contro lling emissions from FCPP would not appreciably improve visibility – a si gnificantly different result than the EPA’s CALPUFF modeling.

A public/private coalition (0381) submitted simila r comments arguing that there is no firm evidence that addition of SCR would provide NO x reductions that would have an perceivable improvement in visibility at the Grand Canyon. Sim ilarly, a CAP agricultural water users group (0305) stated that EPA’s analysis of factor 5 does not full y consider the impact (or lack thereof) the control options may have on visibility by failing to addre ss and explain contrary evidence and studies in thePage 109

EPA Responses to Comments: Navajo Gene rating Station Final Rule | July 28, 2014 record (e.g., the NREL report and the study on MPP). In failing to appropr iately consider the results of these studies, the commenter believes that EPA’s factor 5 analysis is arbitrary, capricious, and not in

accordance with the law.

Response:

These comments are variations of other comm ents for which we have provided separate responses. We respond to the NREL and MPP closur e study below: we believe the conclusions from these papers are overstated, and believe we can re ly on our CALPUFF results. The different results

from the other studies mentioned are the result of differing input assumptions , different choices for visibility calculation method, and/ or different model vers ions. We responded briefly to the visibility calculation method above; we respond to the model version question next.

Comment: EPA should have used an updated version of CALPUFF

Two of the owners of NGS (0314, 0348) and the operator of the Kayenta Mine (0384) indicated that EPA erred in using CALPUFF version 5.8 in its modeling rather than the more recent CALPUFF

version 6.4.

One of the owners of NGS (0348) noted that EPA’s BART Guidelines recommend use of the CALPUFF model for evaluating visibility im pacts, and CALPUFF version 5.8 is the EPA approved version for use in BART applications. The commenter cited several studies ove r the past decade that

have concluded that CALPUFF version 5.8 over predicts particulate nitrate formation by as much as a factor of 3 to 4 during wintertime conditions. The same commenter (0348) stated that model development has continued, and TRC (CALPUFF’s de veloper) released version 6.4 (now 6.42) in November 2010 to fix certain coding “bugs” and to improve the chemistry module. The commenter

cited a number of studies that show that CALPUFF version 6.42 predicts lowe r nitrate concentrations than version 5.8, and gives results that ar e closer to measured concentrations.

This commenter (0348) indicated that wh ile CALPUFF version 6.42 represents a state of the art upgrade, EPA continues to use the outdated CALPUFF version 5.8, which results in an over prediction in the visibility benefits that can be expected fr om additional emission controls at NGS. The commenter believes that EPA should adopt the most recent, scie ntifically sound, and accura te version of CALPUFF and use that version in assessing BART. The commenter opined that, at the very least, the EPA should acknowledge, as it has in the past, that its approved version of CALPUFF significantly over predicts visibility impairment and adjust its assessment of the visibility impr ovement BART factor accordingly.

Another co-owner of NGS (0314) likewise stat ed that EPA continues to conduct its modeling using CALPUFF version 5.8 even though it is wide ly acknowledged (including by EPA, Federal Land Managers, and Dr. Joe Scire, the lead de veloper of the CALPUFF model) to over- predict haze causing nitrate formation, even though a newer and more refine d model (version 6.42) is available. According to this commenter, EPA is obligated to perform its BA RT analysis using the best application currently available for predicting visibility impacts. The comme nter asserted that it is extremely concerning that EPA would impose a requirement costing a facility hundreds of millions of dollars based on the results from the “regulatory version” of a model when a newe r, more accurate version of the model is available.

The operator of the Kayenta Mine (0384) asse rted that use of CALP UFF version 5.8 is not consistent with the BART rules. According to the commenter, EPA acknowledged issues withPage 110

EPA Responses to Comments: Navajo Gene rating Station Final Rule | July 28, 2014 CALPUFF’s chemistry modeling when the 2005 BA RT rules were finalized (citing 70 FR 39121, 39122, 39123). The commenter concluded that the BART analysis should be based on the best application available with respec t to visibility impacts which, when the 2005 BART rules were promulgated, was CALPUFF version 5.8. The commenter indicated that use of CALPUFF version 5.8 in

2005 was consistent with the court’s view that if an agency’s decisi on does not constitute a “reasonable, good-faith presentation of the best in formation available under the circum stances,” it would be arbitrary and capricious (citing Lee v. U.S. Air Force , 220 F.Supp.2 nd 1129, 1233-34 (D. N.M. 2002), which cites

Colorado Environmental Coalition v. Dombeck , 185 F.3rd 1162, 1172 (l0th Cir. 1999). The commenter

believes that since CALPUFF version 6.4 was the best m odel for predicting visibility impacts at the time SRP submitted its additional modeling results for NGS , the EPA must allow its use even though it has not been officially adopted by EPA. The commenter stated that the change from CALPUFF version 5.8 to 6.4 results in changes to modeled visibility im provements of 5 to 500 percent (citing the JBR report).

Response:

The commenters stated that EPA has acknowledg ed CALPUFF overpredictions of nitrate; no citation was provided, but an EPA presentation at the 2012 EPA Regional/State/Local Modelers Workshop did include the statement “CALPUFF wa s known to overestimate nitrates when it was promulgated as a regulatory model [68 FR 18440, Ap ril 15, 2003] and in the BART Guidelines [70 FR 39104, July 6, 2005], therefore EPA chose the 98th perc entile (8th High) for regulatory evaluations.” 175
EPA already considered the limitations of CALPUFF and its included chemistry scheme when selecting it for BART modeling; that regula tory action is past, and cannot be revisited in this action.

We disagree with the commenters that any new CALPUFF version should be used for the BART

determination. We relied on version 5.8 of CALPU FF because it is the EPA-approved version in accordance with the Guideline on Air Quality Mode ls (“GAQM”, 40 CFR 51, Appendix W, section 6.2.1.e); we updated the specific vers ion to be used for regulatory purposes on June 29, 2007, including minor revisions as of that date; the approved CALPUFF modeling system includes CALPUFF version 5.8, level 070623, and CALMET version 5.8 level 070623. 176 CALPUFF version 5.8 has been thoroughly tested and evaluated, a nd has been shown to perform c onsistently with the initial 2003 version in the analytical situations for which CALPUFF has been approved.

The latest version of CALPUFF, 6.4, incorporates a more detailed treatment of chemistry, but it is not approved by EPA for use in regulatory actions . Given the current regulatory status of CALPUFF, the use of version 6.4 would requir e either a new rulemaking, or an “alternative model” demonstration under GAQM 3.2.2. Our promulgation of CALPUFF ( 68 FR 18440, April 15, 2003) as a “preferred” model approved it for use in analyses of Preventi on of Significant Deterioration increment consumption and for complex wind situations, neither of which involve chemical transfor mations. For visibility impact analyses, which do involve chemical transf ormations, CALPUFF 5.8 is c onsidered a “screening” model, under GAQM section 4.2.1, rather than a “prefe rred” model; this “scree ning” status is also

175 “CALPUFF Status and Update”, Tyler J Fox, 2012 EPA Re gional/State/Local Modelers Workshop, April 30, 2012. Available at http://www.cleanai rinfo.com/regionalstatelocalmodelingworkshop/archive/2012/agenda.htm; direct link: http://www.cleanairinfo.com/regionalstatelocalm odelingworkshop/archive/2012/presentations/2- 5_2012RSL_CALPUFFstatus_TFox.pdf

176 A slightly updated version, CALPUFF 5.8.4 (level 130731) was approved by EPA in December 2013, after the modeling work for our NPR proposal was completed. We believe it would not be appropriate to redo the modeling in between our proposed and final action. Also, the changes were all “bug fixes”, and we do not believe the model results would be materially different were the updated version to be used.Page 111

EPA Responses to Comments: Navajo Gene rating Station Final Rule | July 28, 2014 described in the preamble to the BART Guidelines (70 FR 39123, July 6, 2005). 177 A version of CALPUFF other than 5.8, and especi ally one with such fundamental differences in its handling of chemistry, would no longer be considered a “scr eening” model under GAQM section 4.2.1. Instead it would be considered an “alternative model”, s ubject to the provisions of GAQM section 3.2.2(b), requiring full model documentation, peer-review, and performance evaluation. No such information for the later CALPUFF versions that meet the require ments of section 3.2.2(b) has been submitted to or approved by EPA. Experience has shown that when th e full evaluation procedure is not followed, errors that are not immediately apparent can be introduced along with new model features. For example, changes introduced to CALMET, a meteorological pr eprocessor for CALPUFF, to improve simulation of over-water convective mixing heig hts caused their periodic collapse to zero, even over land, so that CALPUFF concentration estimates were no longer reliable. 178 The change to CALPUFF 6.4 is not a simple model update to address bug fi xes, but a significant change in th e model science that requires its own rulemaking with pub lic notice and comment.

Furthermore, it should be noted that th e U.S. Forest Service and EPA review 179 of CALPUFF version 6.4 results (submitted by certa in power plant operators with their BART analyses for their facilities) showed that differences in its result s from those of version 5.8 are driven by two input assumptions and not associated with the chemistry changes in 6.4. Use of the so-called “full” ammonia limiting method and finer horizontal gr id resolution are the pr imary drivers in the predicted differences in modeled visibility impacts between the mode l versions. These input assumptions have been previously reviewed by EPA and the FLMs and have been rejected based on lack of documentation, inadequate peer review, and lack of technical justification and validation.

Introducing a new regulatory model is a long pro cess. EPA intends to conduct a comprehensive evaluation of the latest CALPUFF version along with other “chemistry” air quality models, including a full statistical performance evaluati on, verification of its scientific ba sis, and determination of whether the underlying science has been incorporated into the modeling system correctly. To accommodate such a model, there would have to be an evaluation of th e effect on the regulatory framework for its use, including in New Source Review permitting, and also changes to the Guideline on Air Quality Models and other modeling guidance, in consultation with the FLMs. CALPUFF vers ion 5.8 has already gone through this comprehensive evalua tion process and remains the EPA- approved version. We believe its chemistry algorithms and performance were adequate ly taken into account in choosing it for BART modeling. We believe CALPUFF 5.8 is thus the appropriate version fo r EPA’s BART determination for

NGS.

Comment: Closure of Mohave Project did not improve visibility , shows CALPUFF unreliable

One of the owners of NGS (0348) discussed the findings of analysis cond ucted after the closure of the Mohave Power Project (MPP) (a 1,580 MW coal-fired power pl ant) to evaluate whether the

closure had resulted in improved visibility in Grand Canyon National Park. 180 The commenter indicated

177 Note that EPA already considered th e limitations of CALPUFF and its included chemistry scheme when selecting it CALPUFF for BART modeling and EPA is following its own regulations in this rulemaking.

178 “CALPUFF Regulatory Update” Roger W. Brode, Presentation at Regional/State/L ocal Modelers Workshop, June 10-12, 2008, available at http://www.cleanairinfo.com/regionalstatelocalmodelingworkshop/archive/2008/agenda.htm.

179 “CALPUFF Status and Update” Tyler J. Fox, Presentation at Regional/State/Local Modelers Workshop, April 30-May 4, 2012, available at http://www.cleanairinfo.com/regionalstatelocalmodelingworkshop/archive/2012/agenda.htm.

180 Jonathan Terhorst and Mark Berkman., Effect of coal-fired power generation on visibility in a nearby national park

, Atmospheric Environment 44 (2010) 2524-2531. doi:10.1016/j.atmosenv.2010.04.022. (manuscript version also available as “Mohave study on visibility” on SRP NGS web page http://www.ngspower.com/reports.aspx )Page 112

EPA Responses to Comments: Navajo Gene rating Station Final Rule | July 28, 2014 that although CALPUFF version 5. 8 modeling predicted that the pl ant had a significant impact on visibility in the Grand Canyon, this study concluded that there was “ virtually no evidence that the MPP closure improved visibility in th e Grand Canyon; or, equi valently, that the plant ’s operation degraded it. Mean visibility (deciviews) and light extinction in [the park] did not res pond to the closure in a statistically significant fashi on. Sulfate levels did drop throughout the park, but not by an amount sufficient to induce a percep tible improvement in visibility. We ar e thus unable to conclude that the closure improved visibili ty in the Grand Canyon .” The commenter also quoted report of this study as stating that the “ results raise questions about the reliability of CALPUFF .”

According to the commenter (0348) this analysis demonstrated that, contrary to the predictions of the CALPUFF model, a significa nt reduction in pollutants from a la rge power plant did not produce a perceptible improvement in visibility, providing further evidence that there is substantial over prediction

bias associated with the CALPU FF model that EPA did not take in to account when considering the visibility improvement factor in evaluating BART control options for NGS. The commenter believes

that EPA should utilize more r easonable input assumptions to CALPUFF and avoi d layering overly conservative inputs, in recognition of the studies such as the MPP study that demonstrate that the model is likely to inherent ly over-predict visibility improvements.

Similarly, four individuals (0128, 0233, 0251, 0345) discussed how the MPP was closed because it was believed to be a major contributor to haze in the area, and stated that neither the haze conditions nor the air quality near Laughlin, NV and Bullhea d City, AZ has improve since the plant was demolished. Two of the commenters (0233, 0251) refe renced the 2010 Terhorst study mentioned above,

which concluded that the shutdown of the Moha ve plant delivered no “s tatistically significant improvement in visibility” at th e Grand Canyon, although one of the comm enters (0251) recognized that a paper published in 2012 disputed this claim. 181 This commenter urged EPA to focus on strengthening

the research on the measurement and cause of haze in parks before taking any action related to the operation of NGS. The other commenter (0233) highlight ed that the closure of MGS cost the state of Arizona nearly 600 jobs and hundreds of millions of dollars in direct economic benefits.

In contrast, one individual ( 0327) applauded the closure of MP P, believing that this plant contributed to the production of haze, which negative ly impacted visibility at national parks and the

health of local residents.

Response:

We disagree that the Terhorst & Berkman (T&B ) study cited by the commenters raises questions about CALPUFF’s reliability. The st udy is worth considering as the Regional Haze program evolves, but one study does not invalidate CALPUFF, especi ally one not designed as a model performance evaluation. CALPUFF has had multiple successful performance evaluations, and via the BART Guidelines has already gone through public comment and rulemaking to become the recommended

model for use in BART determinatio ns. We continue to believe that CALPUFF is appropriate for this

purpose.

The Terhorst &Berkman conclusion on the effect of MPP closure is actually close to that from earlier analyses, which also predic ted improvements less than the human perceptibility threshold of 1 dv.

181 W.H. White, R.J. Farber, W.C. Malm, M. Nuttall, M.L. Pitchford, B.A. Schichtel , Comment on “Effect of coal-fired power generation on visibility in a nearby national park (Terhorst and Berkman, 2010)” , Atmospheric Environment 55 (2012) 173-178. doi:10.1016/j.atmosenv. 2012.02.076 (also available on DRI web page: http://www.dri.edu/marcpitchford?showall=&start=2 )Page 113

EPA Responses to Comments: Navajo Gene rating Station Final Rule | July 28, 2014 As discussed in the White et al. paper cited by one commenter, the T&B analysis is “misleadingly presented as discrediting previous studies and their interpretation by regulators. In reality the T&B analysis validates a consensus on MPP’ s visibility impact that was esta blished years before its closure.” This T&B conclusion is nothing new, despite some commenters’ current focus on the perceptibility of the MPP shutdown. In any case, as we note else where in this respons e to comments, human imperceptibility of the effect of a control does not remove the RHR requirement to impose reasonable controls on contributing sources, even in the face of uncertainty over the indivi dual source contributions. Visibility progress will require emission reductions from many s ources on a regional scale. The T&B study also did not create any disagr eement with earlier work when it stated that other regional sources were larger contributors to visibility impairment than MPP was. As White et al . stated, T&B “create something of a ‘straw man’ when they rhetorically se t their results against an im agined prior belief that MPP was the main source of Grand Canyon haze. This was clearly not the assessm ent of the scientists and stakeholders who worked together to estimate M PP’s impact, nor was it the basis for the accord that all parties accepted as appropriate fo r updating MPP’s control technology.” White et al. also noted certain discrepancies in the T&B work, such as a 1 dv visibility improvement at two of three monitoring sites, yet the result of pooling th e three was of a 0.5 dv worsening in visibility; this information calls their conclusions into question.

Finally, White et al. explicitly address the supposed disagreement between the T&B methodology and results from CALPUFF, pointing out th at the comparison was flawed in several ways. For one thing, the ambient data relied upon by T&B is collected only every 3rd da y; this results in too few days for a statistically valid comparison to the 98th percentile results reported from CALPUFF. Another important comparison flaw is that when T& B translated visibility extinction into deciviews, they used recent polluted conditions as the back ground for comparison, whereas the BART Guidelines and the CALPUFF results use natural conditions as background. 182 When the T&B results are computed using natural background, they are substantially larger, and genera lly in agreement with CALPUFF

results.

Specifically, T&B found that MPP closure re sulted in a sulfat e reduction of 0.20 μg/m 3 ; using the IMPROVE equation they computed a corresponding 0.71 Mm -1 improvement in extinction (“b ext ”) at the Meadview monitor in the Grand Canyon. Using th e definition of deciviews and a recent measured background extinction of 28.22 Mm -1 , the extinction improvement was translated into an improvement

of 0.25 dv.

The definition of deciview is: dv = 10*ln(b ext /10). The change in deciviews in going from initial conditions to final conditions is: dv change = dv final – dv initial = 10*ln(final b ext /10) - 10*ln(initial b ext /10) = 10*ln(final b ext / initial b ext )

For the MPP closure, with init ial = recent measured 28.22, and final = measured minus MPP’s 0.71, the

T&B calculation was: dv change = 10*ln[ (28.22 - 0.71) / 28.22 ] = -0.25 dv (0.25 dv improvement)

182 EPA considered and rejected comments on the proposed BART Guidelines that visibility impacts should be evaluated to relative to current degraded vi sibility conditions and concluded that “[u]sing existing conditions as the baseline for single source visibility impact determinations would create the followi ng paradox: the dirtier the existing air, the less likely it wo uld be that any control is required.” (70 FR 39124).Page 114

EPA Responses to Comments: Navajo Gene rating Station Final Rule | July 28, 2014 However, computing deciviews relative to natural c onditions, the visibility benefit from closing MPP is considerably larger, 3.3 dv. Using the Grand Canyon’s be st 20% of days natural conditions extinction of

1.83 Mm -1 , with initial = natural plus MPP 0.71, and final = natural: dv change = 10*ln[ 1.83 / (1.83 + 0.71)] = -3.3 dv

Even when annual average natural conditions (4.39 Mm -1 ) are used instead of the best 20%, the closure benefit is substantially la rger than shown by T&B: dv change = 10*ln[ 4.39 / (4.39 + 0.71) ] = -1.5 dv

Both the best 20% of days and the annual average ar e consistent with the BART Guidelines; we have generally used best 20% for the Regional Haze FIPs.

The deciview benefits relative to natural c onditions are much closer to the -2.0 and -2.4 dv CALPUFF results cited by T&B. Thus , their results do not really call the reliability of CALPUFF into question, nor show that it has an overprediction bias.

We agree with commenters’ additional statement that further research on the measurement and cause of haze in Class I areas is needed, as the science of regional haze is complex and our understanding of it is evol ving. But we do not agree that the uncerta inty prevents us from implementing reasonable controls on contributing sources, nor that it excuses us from carrying out the regulatory requirements of the Regional Haze Rule, such as BART.

Finally, with respect to the assertion that MPP wa s closed because of its contributions to haze, EPA would like to clarify that MPP’s closure was not the result of any EPA rulemaking. Rather, the

owners of MPP entered into a Consent Decree with several environmental groups, including the Grand Canyon Trust, Sierra Club, and the National Parks Conservation Association. That Consent Decree required MPP to install pollution c ontrols to reduce emissions of SO 2 and PM from the facility. The Consent Decree was based on alleged violations by M PP of provisions of the Prevention of Significant Deterioration (PSD) program and re quired installation of the pollution controls by the end of 2005. The

owners of MPP decided to close th e facility rather than install pollution contro ls. The decision by the owners of MPP appears to have been shaped by nume rous complex factors. EP A was not involved in the decision-making process or the re gulatory proceedings surrounding it. The MPP used coal that was mixed with water and conveyed as slurry in a pipeline. The water to make the slurry was drawn from the N aquifer from the Hopi Reservation. EPA understands that a contract to use the water from the N aquifer expired in 2005 and was not re newed. The lack of a reliable source of water for the coal slurry likely contributed to the decision by the owners of MPP to discontinue operations at the end of 2005. Furthermore, it is EPA’s understanding that in 20 06, Salt River Project (SRP), a co-owner of MPP, sought to form a new ownership grou p to restart MPP, including to in stall the new air pollution controls required by the Consent Decree as well as develop a new water supply system for the coal mine, however, SRP ended its efforts to restart MPP becau se it could not negotiate its intended purchase of

Southern California Ed ison’s share of MPP in time to restart by 2011. 183 Therefore, although EPA

understands that tribes and other communities experienced adverse impacts from the closure of MPP in 2005, the closure and the failed effort s to restart MPP are not attribut able to, or the result of, EPA rulemakings related to haze.

183 See February 6, 2007 Media Advisory from SRP, titled “SRP Press Release on Mohave” in the docket for this rule, and article in Power Engineering Magazine: http:// www.power-eng.com/articles/print/volume-111/issue3/departments/startup/srp-decision-seen-as-ending-mohave-re-start.htmlPage 115

EPA Responses to Comments: Navajo Gene rating Station Final Rule | July 28, 2014 Comment: Impact of emission rates and ammonia emi ssion on modeled visi bility benefits

The operator of the Kayenta Mine (0384) stated that EPA changed the input assumptions for

emission rates for SO 4 , PM 2.5 , and NO x associated with the H 2 SO 4 chemistry. Citing the JBR report, the commenter asserted that there is limited, if a ny, bases in other BART analysis for the proposed

calculation metrics for H 2 SO 4 chemistry and control effects used by EPA. Also citing the JBR report, the

commenter indicated that EPA assumed emission ch anges increased the deci view impacts by 50 to 150 percent, giving the following example: using the original SRP emissions, the change obtained by installing SCR according to SRP wo uld be 0 at the Grand Canyon, while EPA emissions result in a 0.74 dv change.

This commenter (0384) also addressed the cumulative impact of EPA’s assumptions on background ammonia concentration and emission rate s, based on the JBR report. According to the commenter, the combined EPA assumptions increas ed the modeled deciview improvements due to adding SCR to LNB/SOFA by 60 to 170 percent. The commenter gave the example of the combined difference between the SRP modeling at the Grand Canyon, 0.86 dv, and EPA modeling, 2.9 dv, which is more than three times higher. The commenter stat ed that with all else being the same except for ammonia and emissions, the SRP modeling shows a vari ance of just over 1 dv for only 2 of the 11 Class I areas, while EPA modeling shows an improvement in excess of 1 dv at 8 of the 11 Class I areas. The

commenter concluded that EPA’s conclu sion that there will be a percepti ble improvement in visibility is premised upon incorrect and unsupported modeling inputs.

Response:

These comments are mainly the same as those c overed in our other respons es, especially the one

above that claims EPA overestimates NGS’s visibili ty impact. The only additional comment here is the challenge to our treatment of H 2 SO 4 chemistry. The commenter does not suggest any alternative and did not provide any technical support for their posi tion. Our emissions work was based on similar calculations developed by AECOM for SRP, with some alternative assumptions about control efficiencies, etc. as documented in our em ission calculation spreadsheet in the docket, NGS_BART_Scenarios_Emissions_EPA_proposal.xls. In turn, that work relied on work by Electric

Power Research Institute documents about H 2 SO 4 184 and ammonia, 185 as described in the TSD, p.111 and p.123, respectively. We believe our treatment of H 2 SO 4 and ammonia chemistry is reasonable.

Comment: Validate modeled predictions of visibility improvement with images/instrumentation

Two individuals (0049, 0066) ques tioned the effectiveness of using models to determine visibility improvements at national parks and wilder ness areas, and recommended that actual imagery be used to validate the predicted out comes and confirm the overall effectiveness of the control measures. An industry/commerce commenter (0065) recommended the use of instrument ation to monitor the opacity of NGS emissions.

184 “Estimating Total Sulfuric Acid Emissions from Stationary Power Plants”, Version 2010a, 1020636, Technical Update,

Electric Power Research Institut e, April 2010. Available at http://www.epri.com/abstracts/Pages/ProductAbstract.aspx?ProductId=000000000001020636.

185 “Estimating Ammonia Emissions from Stationary Power Plan ts”, Electric Power Research Institute (EPRI), Palo Alto, CA: 2009, Report No. 1017985. Available at http://my.epri.com/portal/server.pt?Abstract_id=000000000001017985.Page 116

EPA Responses to Comments: Navajo Gene rating Station Final Rule | July 28, 2014 One of the individuals (0049) listed the following limitations of climate sensitivity models, citing

the IPCC:

1. Observation coverage for initial conditions;

2. Observation errors for initial conditions;

3. Errors in quality control;

4. Equations of motion are incomplete;

5. Errors in numerical approximations;

6. Simplified terrain;

7. Model parameterizations incorrect; and

8. Missing parameterizations.

This commenter (0049) added that climate is sens itive to changes in cloud frequency and structure, which adds to the complication of modeling. The co mmenter encouraged the NPS to take part in monitoring the impact on visibility through live images or photogra phy, which the commenter believes will minimize the possibility of loopholes in implementation.

The commenter (0049) discusse d visible emissions monitoring methods such as EPA Method 9 and ALT-082, apparently believing that these methods are suitable for measuring ambient visibility conditions. The commenter also cited a 1990 report whic h, according to the commenter, determined that emissions from NGS were the larges t contributor to the degradation of visibility at national parks ( Haze in the Grand Canyon: An Evaluation of WHITEX , 1990). The commenter conclude d that it is imperative that we do not let this issue escape us for another 25 years and that we actually catch our mistakes with live data rather than continue to question the eff ectiveness of virtual climate models for visibility improvement.

The industry/commerce commenter (0065) recomme nded a specific supplier of instruments for digitally monitoring the opacity of NGS emissions according to the requirements of the EPA’s ALT-082

method.

Response:

We agree with the commenters that additio nal monitoring on an ongoing basis would help evaluate visibility changes over time, including imp acts from NGS specifically. We also agree that air quality models have some uncertainty and limits to their accuracy, including some of the limitations listed by the commenter. We note that the difficulties in assessing the impacts of a particular source using imagery and/or actual measurements of pollu tants and extinction incl uding the confounding effect of pollution from many other sources over a large area; it can be difficu lt to tease out the effect of the one source of interest. In any cas e, in the BART Guidelines we did not require any new monitoring, model validation, or source attributi on studies, which would have entailed large expenses and delays for

the hundreds of sources nationwide for which visibil ity impacts had to be estimated. In the BART

Guidelines we also determined that CALPUFF is adequate for the purpose of modeling for BART determinations. We also note that previous FIP re quirements promulgated for NGS already included an opacity requirement, limiting opacity from Units 1, 2, and 3 at NGS to no greater than 20 percent opacity, excluding condensed uncombi ned water droplets, averaged over any six minute period and 40 percent opacity, averaged over six minutes , during absorber upset transitions. 186

186 See 40 CFR 49.5513(d)(4).Page 117

EPA Responses to Comments: Navajo Gene rating Station Final Rule | July 28, 2014 Comment: Level of human perceptibility

One of the owners of NGS (0348) stated th at the Fact Sheet accompanying the February 2013 Proposal rule asserts that “ [a] difference of 0.5 deciviews is gene rally considered a perceptible change .” The commenter refuted this assertion, noting that th e regional haze rules and BA RT Guidelines indicate that 1.0 dv may generally be consid ered the threshold for human per ceptibility (citing 64 FR 35726-27; 70 FR 39120) and referring to two studi es finding that a change greater than 0.5 dv is required before the human eye can detect a shift in conditions. The commenter indicated that one study found 1 to 2 dv necessary for human perception, and the second found 1.8 dv necessary.

Response:

We agree with the commenter that opinions di ffer on the threshold for human perceptibility. In addition to the passage cited by the commenter stating that 1 dv is a correct perceptibility threshold, the

BART Guidelines also stated: “In th e proposal we noted that a 0.5 deciview change in visibility is linked to ‘perceptibility,’ or a just noticeable change in most landscapes. .... (changes in light extinction of 5 percent will evoke a just noticeable change in most landscapes). Converting a 5 percent change in light extinction to a change in d eciviews yields a change of approximately 0.5 deciviews.” 187 In any case, we did not rely on this threshold in determining SCR to be BART for NGS . We have referred to visibility improvements of 0.5 dv or 1.0 dv in various places as a benchmark, and have stated that the multiple Class I areas showing visibility improvements of 1 dv or greater indicate a substa ntial benefit from SCR. Our justification for selecting a SCR level of contro l as BART is based on our five factor analysis, including the substantial vi sibility improvement that will occur at 11 surrounding Class I areas. We also note, as stated in a response above, that human perceptibility is not a requirement for BART.

Comment: Cumulative dv

One of the owners of NGS (0348) and an industr y trade association (0306) objected to EPA’s use of cumulative impacts in assessing the degree of visibility improvement from emission controls, asserting that this approach has no tie to human pe rception and distor ts the BART analysis. One of the commenters (0348) referred to a pa per authored by Dr. Ivar Tombach (attached to the comments as Appendix E) that concludes that this metric is not appropriate because change s cannot be perceived in multiple Class I areas by a single observer at a gi ven time; that is, an individual observer cannot perceive an additive improvement at multiple Class I areas. The other commenter (0306) stated that the cumulative approach distorts the visibility analysis because it sums computer-modeled visibility impacts at multiple locations at multiple times, and that th is approach is irrational because it treats a single source of regional haze differently depending on the number of Class I areas located around the source. This commenter believes that the public will be misl ed by EPA’s “exaggeration” of the benefit of its

action.

The NGS owner (0348) added that the BART Guid elines focus on visibility impacts at individual Class I areas and do not recommend or imply that addi ng the impacts at different sites is appropriate. According to the commenter, adding improvements across multiple Class I areas effectively multiplies the threshold metric by the number of Class I areas wh ich, the commenter believes, flies in the face of the basic science of visibility per ception thresholds. The commenter opined that this metric is akin to

187 70 FR 39119, footnote 28 (July 6, 2005).Page 118

EPA Responses to Comments: Navajo Gene rating Station Final Rule | July 28, 2014 examining the effects on visibility at several loca tions within the same Class I area and adding them. The commenter believes that a correct modeling result for a given Class I area is determined by finding the maximum impact over all receptors, not by a dding individual receptors at a Class I area.

Response:

EPA considers it important to account for visibility impacts at multiple Class I areas. The goal of the visibility program is to remedy visibi lity impairment at all Class I areas. 188 One approach to account

for the benefits to all affected Class I areas is the cumulative “tot al dv” metric. We disagree with commenters that cumulative improvement over multiple areas is an inappropriate metric, or that examining a single Class I area is sufficient. The cu mulative improvement metric (i.e., the simple sum of impacts or improvements over all the Class I areas) is not intended to correspond to a single human’s perception at a given time and place, and we did not represent it as su ch. Indeed, the use of CALPUFF’s 24-hour average extinction, and the 98th percentile from among daily deciviews that may occur at different locations, is already di fferent from what one person w ould actually observe, however, the BART Guidelines consider it adequate for the pu rpose of modeling in BART determinations. In our proposal we stated “In assessing the degree of visibility improvement fr om controls, we relied heavily on the maximum deciview improvement among the Class I areas and the num ber of areas showing improvement (i.e., all 11 Class I areas), with cu mulative improvement providing a supplemental measure that combines information on the number of areas and on individual area improvement.” 189
The approach is simply one way of assessing impr ovements at multiple areas, for consideration along with other visibility metrics. Anot her approach would be to simply lis t visibility improvements at the various areas, and qualitatively weigh the number of areas and the magnitudes of the improvements. The cumulative sum is simply an easily understood a nd objective way of weighing cumulative visibility improvement, as part of the overall BART decision.

Comment: Lack of information on actual c onditions at times of high haze

One industry trade association (030 6) expressed concern at the lack of information related to the actual atmospheric conditions that existed at the time s that high levels of h aze were recorded and the degree to which the atmospheric conditions be ing modeled match those actual conditions. The commenter believes that such comparisons are needed to provide reasonable a ssurance that the approved BART limits will actually improve the major h aze episodes that are recognized by the public. The commenter added that to avoid false expectations , EPA should explain the conditions where visibility improvements will be less discernible to the public; for example, the public should know whether the BART-imposed emission reductions will produce a noticeable improvement in haze conditions that

occur as a result of the tr ansport of contaminated air masses from distant population/industrial centers.

Response:

As stated in or preceding response, under the BART Guidelines we did not require new modeling studies or validation, and determined that CALPU FF is appropriate for BART determination modeling. Since the modeling was based on three years of mete orological data, we belie ve that it adequately captured the various conditions conducive to high and to low amounts of haze. Somehow using actual haze measurements would entail a much larger scale effort of source attribution modeling, such as with

188 CAA section 169A (a)(1).

189 78 FR 8286 (February 5, 2013).Page 119

EPA Responses to Comments: Navajo Gene rating Station Final Rule | July 28, 2014 a photochemical grid model and includi ng the effect of many other sour ces. This scale of modeling is more appropriate for States’ full regional haze plans that assess the progress made by control and other source changes over time. It is beyond the scope of what is pr actical or necessary for BART determinations, given that CALPU FF is adequate for this purpose.

We agree with the commenter that it is important the public not be misled about the visibility improvements that will result from BART controls. As noted above, for applic ations involving chemical transformations, the CALPUFF model is consider ed a “screening” appro ach. Its treatment of atmospheric chemistry is simplified as compared to a photochemical grid model. For CALPUFF BART modeling we include only a single source, instead of the hundreds or thousands that affect actual visibility. We also use CALPUFF’s 24-hour averag e estimates, whereas actual visibility seen by a national park visitor is instantaneous, not an av erage over multiple hours. Finally, we use visibility

estimates at a collection of indi vidual model receptor locations, wh ereas actual views depend on the pollution along a miles-long site path and also on th e relative angles of th e viewer, the sun, and the pollution. In short, CALPUFF is not intended to provi de a realistic estimate of what a viewer would actually see, but rather an estimat e of a source’s approximate average contribution to impairment, if no

other sources existed. We consider that CALPUFF is adequate and appropriate for that purpose, and for

use in BART determinations.Page 120

EPA Responses to Comments: Navajo Gene rating Station Final Rule | July 28, 2014 

## 8.0 Comments on BART Determinations

8.1 Comments on the Proposed BART Determination for NO x

Comment: General

One environmental advocacy group (0373) support ed EPA’s proposed finding pursuant to the

TAR that a BART determination for NGS is “n ecessary and appropriate” (citing 78 FR 8279 and 40 CFR 49.11), asserting that NGS is pl ainly subject to BART under the statutory and regulatory criteria

Numerous individuals (0067, 0074, 0149, 0162, 0164, 0178, 0218, 0236, 0393, 0240, 0245, 0264.8, 0283, 0284, 0394, 0399, 0412) and environmental or public interest groups (0395, 0404) supported the proposed BART rule requiring NGS to comply with NO x emission limits within 5 years of the final rule, while two individua ls (0204, 0210) implied that they would support either the proposed BART determination rule or the adoption of EPA BART Alternative that would extend the schedule requiring the installation of SCR on one unit pe r year between 2021 and 2023. One public interest advocacy group (0015) expressed support for the pr oposed BART determination and applauded the Agency for addressing emissions from NG S despite controversy and resistance.

One commenter (0420) submitted copies of a numbe r of resolutions enacted by various Navajo Nation Chapters in favor of the proposed BART de termination to support the position that the most stringent pollution controls possibl e should be applied to NGS, and that there should be a transition to a renewable energy plant. The comme nter submitted resolutions appr oved by approximately 30 Chapters of the Navajo Nation. A tribal government commente r (0362) similarly urged EPA to hold NGS to the highest BART standard and not to let NGS prolong the implementation phase for years. The commenter stated that NGS owners are using the Navajo Nation for leverage to continue its operation and use the threat of some great economic loss to the Navajo Na tion as a strategy to lower the standards to less costly requirements regarding BART a nd strategically delay the retrofit.

In contrast, a number of indi viduals (0145, 0146, 0147, 0148, 0161, 0163, 0165, 0167, 0168, 0193, 0200, 0203, 0205, 0212, 0226), and entities (0024, 0194, 0214, 0252, 0287, 0314, 0324, 0326, 0343, 0348, 0400, 0406, 0440), opposed EPA’s proposed BART determination for various reasons, including the potential adverse impacts if the inst allation of controls forced NGS to close. Many

commenters asserted that LNB/SO FA should be determined to be BART at NGS based on the “extraordinarily high” incremental cost-effectiveness values in terms of $/ton and $/dv provided in submissions by the NGS operator. Othe r commenters (0175, 0189, 0220, 0293, 0295, 0305, 0317, 0381) objected to the BART proposal based on assertions th at EPA’s analysis was not based on sound science, or that the EPA failed to properly weigh the fi ve BART factors result ing in a proposed BART determination that is arbitrary, cap ricious, and an abuse of discretion. While supporting efforts to ensure that the production of power is environmentally responsible, a stat e agency (0017/0289/0320) asserted that the BART proposal does not ap propriately balance environmenta l benefits with the cost to

consumers.

Response:

EPA acknowledges that members of the public and regulated community expressed strong support both for and against stringent NO x controls at NGS. The responses to comments related to thePage 121

EPA Responses to Comments: Navajo Gene rating Station Final Rule | July 28, 2014 compliance timeframe for better than BART alternat ives is discussed in section 8.5 and 9.0. Responses

related to the cost-effectiveness of controls are discussed in sec tion 3.0, and comments related to the Affordability Analysis and visibility modeling ar e discussed in sections 4.0 and 7.0, respectively.

Comment: BART limit for NGS should be 0.04 lb/MMBtu

An environmental advocacy group (0373) argued th at the final BART emission limit should be more stringent. The group drew on supporting reports prepared by Vict oria Stamper (Stamper report) and Nathan Miller and Ranijit Sahu (Miller/Sahu repor t) (submitted with the comments) to argue that SCR typically is designed for and achieves 90 percent NO x removal and that electric generating units (EGUs) have been required to achieve lower NO x limits with SCR, therefore, the final BART limit should be no higher than 0.04 lb/MMBtu. According to the commenter, this represents 83 percent removal which would provide a reasonable margin of operating safety for NGS. The commenter indicated that the Stamper report included vari ous SCR-vendor representa tions to this effect.

The comment noted that permitting au thorities have required lower NO x limits than 0.055

lb/MMBtu in recent BACT determinations based on SCR in combination with combustion controls, including PSD permits for Plant Washington, Dese rt Rock, Wygen 3, and Dry Fork. The commenter

also noted that in EPA’s FIP for the San Juan Generating Station (SJG S) in New Mexico, EPA determined that SCR was the most cost-effective pollution control for NO x and imposed a NO x BART emission limit of 0.05 lb/MMBtu on a 30-BOD average basis. The commenter added that in its response to comments on the SJGS BART determination, the EPA confirmed that several EGUs have achieved

NO x emission rates of 0.05 lb/MMBtu or lower, citing to actual emission rates at Seminole Units 1 and 2, Morgantown Units 1 and 2, and Cope Generating St ation. The commenter also indicated that the Dry Fork plant in Wyoming has never emitted NO x higher than 0.04 lb/MMBtu on a 30-BOD average basis.

Response:

EPA disagrees with the commenter that the BART limit for NGS should be 0.04 lb/MMBtu. As discussed below, EPA disagrees with the commenter’ s assertion that emission limits associated with

BART must meet BACT or the lowest emission rate ever achieved with that technology at any coal-fired power plant. 190

EPA agrees that SCR systems can be designed to achieve higher levels of control. Although the commenter provided information to suggest that it is common to de sign SCR for 90 percent removal, exhibit 5 to the Stamper Report did not indicate the extent that combustion controls were used in combination with SCR in characterizing the de sign target. EPA proposed a limit of 0.055 lb/MMBtu achievable with SCR+LNB/SOFA, and using a baseline emission rate of 0.35 lb/MMBtu, this represents a removal of 84 percent. 191 However, as noted in the comment a nd response related to a higher emission

limit for NO x , S&L and SRP have indicated they intend to design SCR at NGS to a target of 0.03 lb/MMBtu. This represents a removal efficiency of 91 percent for SCR+LNB/SO FA (from a baseline of 0.35 lb/MMBtu), or 88 percent for SCR alone (i.e., from 0.24 lb/MMBtu). T hus, although a SCR system

190 WildEarth Guardians v. EPA. 9 th Circuit slip op. (July 17, 2014) (holding that BART limit should be achievable), in the docket for this rulemaking.

191 In characterizing EPA’s BART determinat ion as 74 to 77 percent removal, th e commenter was already accounting for the early installation of LNB/SOFA on each unit after the baseline period. After installation of LNB/SOFA over 2009-2011, Units 1-3 became subject to a limit of 0.24 lb/MMBtu, and achieved NO

x emission rates of approximately 0.21-0.22

lb/MMBtu on an annual av erage basis. See page 2 and 3 of the Stamper Report.Page 122

EPA Responses to Comments: Navajo Gene rating Station Final Rule | July 28, 2014 can be designed to a specific target , the design target is t ypically not equivalent to the actual applicable emission limit. EPA considers a design target of 0.03 lb /MMBtu for NGS to be generally consistent with the information provided by the commenter suggesting that SCR is often designed to achieve 90 percent

control.

EPA also agrees that PSD permits for new facilities have established BACT limits that are numerically lower than 0.055 lb/MMBtu. However, EP A disagrees with the premise that BART limits for existing facilities must equal BACT limits for new facilities. Th e limits of 0.050 lb/MMBtu cited by the commenter were set on a 30-day rolling average for two facilities (Plant Washington and Desert Rock), and on a 12-month rolling average for other facilities (Wygen 3, Dry Fork, and Spruce 2). EPA

notes that the two facilities with limits esta blished on a 30-day rolling average basis have not demonstrated compliance with those limits in practice. The Plant Washington facility is required in its PSD permit to meet a NO x limit of 0.050 lb/MMBtu on a 30-day rolling average basis. EPA notes that Plant Washington, a new power plant in Washington C ounty, Georgia, only commenced construction in

2013. 192 Therefore, actual emission data is not yet available to assess SCR performance at Plant Washington. The commenter also cites to a PSD perm it issued by EPA to Desert Rock, a new facility that would have been built on the Navajo Nation Indian Reservation. The PSD permit required a NO x limit of 0.060 lb/MMBtu over a 24-hour block period, 0.05 lb/MMBtu over a rolling 30-day period, and 0.0385 lb/MMBtu over a rolling 365-day period. EPA notes that construction of Desert Rock never commenced, and the PSD permit issued to this facility is no longer valid. 193

As cited by the commenter, Wygen 3, Dry Fork, and Spruce 2 all have permitted emission limits

for NO x of 0.05 lb/MMBtu on a 12-month rolling averag e basis. However, as noted elsewhere by the commenter, the PSD permit for Spruce 2 sets two NO x limits with different averaging periods. 194 Thus, Spruce 2 is also subject to a NO x limit of 0.069 lb/MMBtu on a 30-day rolling average basis, which is higher than EPA’s proposed BART limit for NGS of 0.055 lb/MMBtu on a 30-BOD basis.

The commenter also cites to several EGUs that achieve NO x emission rates of 0.05 lb/MMBtu or lower. These EGUs typically represent units that have been retrofit with SCR and participate in emission trading programs, such as the Clean Air Interstate Rule (CAIR). As noted by the commenter, numerous facilities achieve hourly emission rates less than 0.05 lb/MMBtu, and many facilities also do achieve 30- BOD averages and annual average emission rates below 0.05 lb/MMBtu as well, e.g., Morgantown 1 and 2, and WA Parish 7 and 8. 195 However, because these facilities operate within an emission trading program, they are not bound by a permit condition to consistently meet a specific NO x limit. Therefore, although these units provide useful information on th e performance capability a nd variability of units that have been retrofit with SCR, they are less releva nt, compared to site-specific vendor information or the performance of similar units with permit limits , for making a case-by-case determination of BART for a specific facility. The commenter also referen ces the source-specific FIP issued by EPA for the San Juan Generating Station in New Mexi co that set a BART limit for NO x of 0.050 lb /MMBtu on a 30- BOD basis. However, on May 12, 2014, EPA proposed approval of a New Mexico SIP submittal for SJGS to replace EPA’s FIP. 196 The New Mexico SIP involves closure of two units at SJGS and sets an emission limit of 0.23 lb/MMBtu on the remaining two units, achievable with the installation and

192 http://power4georgians.com/summary.aspx

193 See document titled “EPA Letter to Sithe Global Re: Desert Rock” in the docket for this rule.

194 See Exhibit 72 to Stamper Report (Special Conditions for Spru ce 2), document number 0372 in the docket for this rule at

EPA-R09-OAR-2013-0009.

195 See Stamper Report at page 7, and references therein, document number 0372 in the docket for this rule at EPA-R09-

OAR-2013-0009.

196 See 79 FR 26909 (May 12, 2014).Page 123

EPA Responses to Comments: Navajo Gene rating Station Final Rule | July 28, 2014 operation of SNCR. When EPA takes final action to approve the New Mexico SIP for SJGS, the FIP

will be withdrawn and SJGS will not be re quired to meet a limit of 0.050 lb/MMBtu.

Although BACT limits lower than 0.055 lb/MMBtu have been established and facilities do exist that achieve emission rates below 0.055 lb/MMBtu, EP A disagrees with the commenter’s assertion that

emission limits associated with BART must meet BA CT or the lowest emission rate ever achieved with that technology at any coal-fired power plan t. The Regional Haze Regulations at 40 CFR §51.308(e)(1)(ii)(A) state that:

The determination of BART must be based on an analysis of the best system of continuous emission control technology available and associated emission reductions achievable for each BART-eligible source that is subject to BART . . .

Additionally, the BART Guidelines state that: “[i]n assessing the capability of the control alternative, latitude exists to consider special circumstances pe rtinent to the sp ecific source under review, or regarding the prior appl ication of the control alternative”, (70 FR at 39166) and that “[t]o complete the BART process, you must establish en forceable emission limits that reflect the BART requirements . . .” (70 FR at 39172). The five-factor BART analysis described in the Guidelines is a case-by-case analysis that consider s site specific factors in assessing the best technology for continuous emission controls. After a technology is determ ined as BART, the BART Guidelines require

establishment of an emission limit that reflects th e BART requirements, but does not specify that the emission limit must represent the maximum level of control achieved by th e technology selected as

BART. The emission limit set to reflect BART must be achievable by the specific source and should be

determined based on consideration of site-specific factors. Therefor e, limits set as BACT during PSD review (e.g., Plant Washington), or emission rates ach ieved from the operation of individual facilities under an emissions trading program (e.g., Morgantown ) may provide important information, but should not be construed to represent the most appropriate BA RT limit representative of a given technology for a given facility. 197

Accordingly, although EPA acknowledges that BACT determinations for new facilities have established slightly lower NO x limits (0.050 lb/MMBtu) than the BART limit EPA proposed for NGS (0.055 lb/MMBtu), EPA does not ag ree that the lower limit reco mmended by commenters of 0.04

lb/MMBtu is BART for Units 1-3 at NGS. The comm enter has not provided any specific information showing that NGS could demonstrate continuous co mpliance with an emission rate of 0.04 lb/MMBtu.

Comment: BART limit for NGS should be in the range of 0.07-0.08 lb/MMBtu

Two of the owners of NGS (0314, 0348), a CAP ag ricultural water users group (0305), and the CAP operator (0343) asserted that the BART NO x emission limit proposed fo r NGS is unachievable. The operator of NGS (0348) noted that the proposed limit of 0.055 lb/MMBtu is to be achieved through

the use of SCR across all three units on a 30 boiler operating day (BOD) basis, which would include periods when the SCR is unable to operate such as startup, shutdown, and periods of load cycling. The commenter made the following arguments:

197 EPA’s Environmental Appeals Board has recognized that PSD emission limits mu st be set to allow fluctuations in operations, stating: “To account for these possibilities, a permi tting authority must be allowed a certain degree of discretio n to set the emissions limitation at a level that does not necessarily reflect the highest possible control efficiency, but will allow the permittee to achieve compliance co nsistently.” In Re Masonite Corporation, 5 E.A.D. 551, 560-61 (1994).Page 124

EPA Responses to Comments: Navajo Gene rating Station Final Rule | July 28, 2014  The information from a catalyst vendor (Hitach i) that the EPA relied on does not support the achievability of the proposed emission limit, as later information received from the same vendor

demonstrates.

EPA relied on information submitted by Hitachi Power Systems (Hitachi) to support its proposed

NO x BART limit of 0.055 lb/MMBtu for NGS, noting that the EPA stated that “... for several reasons, including information from a cataly st vendor that an SCR sy stem at NGS using ... four layers of catalyst can meet a limit of 0.05 lb/MMBtu, EPA is proposing to determine that Units 1-3 can meet an emission limit of 0.055 lb/MMBtu usi ng four layers of catalyst ” (citing 78 FR 8280). The commenter stated that in a subsequent letter submitted to EPA in February 2013, Hitachi (0037) clarified that while it may be possible to design an SCR system to achieve 0.05 lb/MMBtu, it woul d be very difficult for that same system to meet a permit limit of 0.055 lb/MMBtu under al l potential operating ci rcumstances, and that

Hitachi further concluded that “ the utility and their engineer need to determine what margin needs to be applied to insure the unit is capable of achieving less than the permit level on a 30 day rolling

average .” 198

According to the commenter (0348), vendor guarant ees for SCR are typically only provided for

full load operation under a very specific set of conditions, which do not include startup, shutdown, equipment malfunction, or load cycling. The comment er noted that vendor guarantees are complex business arrangements that balance the needs of the utility and include multiple parameters, including

NO x performance, operational servi ce life, pressure drop across the SCR during specific conditions,

SO 2 to sulfur trioxide (SO 3 ) conversion, fuel characteristics, a nd many other elements. The commenter stated that guarantees provided by a vendor are typically limited by fina ncial terms within a contract and would provide little, if any, assistance to the NGS Par ticipants if the system we re to fail to perform as guaranteed and they were unable to operate the unit fo r an extended period of time due to an inability to meet the guaranteed emission rate.

The commenter (0348) also noted that Hitachi acknowledge d that it may be possible to design an

SCR to achieve a lower NO x rate of 0.03 lb/MMBtu but did not conclude that such a design would actually be able to achieve the proposed limit of 0.055 lb/MMBtu in all potential operating

circumstances.

 The NO x emissions achieved in other SCR retrofit si tuations do not justif y the proposed emission

limit.

Although the final NO x BART limit for SJGS was 0.05 lb/MMB tu, one of the plant operator’s principal arguments in the Tenth Circ uit litigation challenging this NO x BART determination was that the EPA had not adequately supported its determinati on that this limit could be achieved at SJGS. To resolve this litigation, the owners of SJGS, the EP A, and the state of New Mexico negotiated a BART alternative that imposes a 0.23 lb/MMBtu plantwide NO x emission limit, which will allow for

installation of Selective Non Catalytic Reduction (SNCR) on two un its, and that requires the retirement of the other two units. Accordingly, the permit limit fo r SCR imposed in the final FIP for SJGS does not provide any evidence that such a limit is actually achievable in practice or that it is appropriate for NGS.

While the EPA stated that Parish Units 7 and 8 at have achieved NO x emission rates “consistent with the vendor guarantee of 0.03 lb/MMBtu” (ci ting TSD page 36), the EPA also acknowledged that the Parish units can demonstrate compliance usi ng a “cap and trade” approach, which makes them

198 This letter is in the docket for this rule making, Docket No. EPA-R09-OAR-2013-0009-0037.Page 125

EPA Responses to Comments: Navajo Gene rating Station Final Rule | July 28, 2014 inappropriate to compare to the units at NGS. The EPA further acknowledged that “ the Parish units do

not achieve 0.03 lb/MMBtu on a consistent basis .” The commenter performed a more detailed review of

the Parish units’ emissions data in the EPA’s Air Program Markets Division (AMPD, formerly known as Clean Air Markets Division or CAMD) which, acco rding to the commenter, revealed that NO x emissions from the units are genera lly higher than 0.03 lb/MMBtu, and NO x emissions from Parish Unit 7 have exceeded 0.055 lb/MMBtu during seve ral months since SCR was installed.

In developing of the Cross State Air Polluti on Rule (CSAPR), the EPA concluded that a NO x limit below 0.06 lb/MMBtu is not achievable through retrofit of SCR on coal fired electric generating units (citing 76 FR 1109, 1115). Th e EPA stated that this “ well controlled emission rate of ... 0.06 lb/MMBtu for NO x represent[s] the lowest annual emissi on rate assumed achievable when state of the art pollution control technologies are installed at coal units ” (citing 76 FR 1115 and footnote 3). The

EPA also stated in this rulemaki ng proceeding that 0.06 lb/MMBtu is unachievable on an annual average
basis, which means that it also is unachievable on a 30 day rolling average basis.

In its proposed rule for North Dakota, the EP A based its BART analysis on a 0.05 lb/MMBtu emission rate, but then proposed to adopt 0.07 lb/MMB tu as a BART compliance limit in recognition that a sufficient margin of compliance must be included (citing 76 FR 58570, 58610).

In its final rule for South Dakota, the EPA established a NO x limit of 0.10 lb/MMBtu for an electric generating unit to allow for an ade quate margin of compliance (citing 76 FR 24845, 24848, 24849).

 The Sargent & Lundy modeling and analysis s how that the propos ed emission limit is

unachievable.

The operator of NGS (0348) contracted with S&L to conduct a modeling analysis to assess whether the NGS units can achieve the proposed 0.055 lb/MMBtu emission limit using SCR control technology (attached as an Appendix to the comment ). According to the co mmenter, S&L performed a detailed modeling assessment that considered typical historical operating c onditions, including periods of load cycling and unit startups and shutdowns, using NGS emissions data from EPA’s CAMD to develop a model that simulates a variety of operati ng conditions based on data collected during past operation of the units. The commente r noted that the model assumes an SCR design basis of 0.03 lb/MMBtu, consistent with the Hitachi statement th at it might be possible to design an SCR for this limit, then the model calculates the emission rates th at would actually be achievable by such a system when considering transient conditions such as startups, shutdowns, and load cycling.

The commenter (0348) explained th at load cycling occurs as a result of varying power demand from the NGS Participants. According to the commenter , at lower loads, the temperature of the exhaust gas decreases, which affects the SCR catalyst perf ormance; specifically, the SCR cannot be operated during periods in which the flue gas temperature is below the mini mum ammonia injection temperature (approximately 600°F) due to concerns over catalyst fouling due to ammonium bisulfate formation, so higher emissions would be expected during periods of operation at lo wer loads. The commenter also

noted that NO x performance between units va ries as a result of the amount of time between maintenance intervals, which occur on a stagge red schedule every 3 years coinciding with the units’ planned outages for major maintenance. The comment er indicated that the LNB/SOFA and SCR equipment also would undergo substantial maintenance an d inspection during these outage periods, but soon after these

overhauls NO x performance begins to degrade as a result of routine operations and will continue to degrade until the next scheduled overhaul.Page 126

EPA Responses to Comments: Navajo Gene rating Station Final Rule | July 28, 2014 The commenter (0348) indicated that of the ei ghteen different operating scenarios modeled by S&L, seven scenarios exceeded the BART limit propos ed by EPA. The commenter stated that during periods of low load cycling and startups, the plantwide NO x emission average consistently exceeded the EPA’s proposed limit of 0.055 lb/M MBtu, with a plantwide 30 BOD NO x emission average as high as 0.067 lb/MMBtu in multiple scenarios. (Additional in formation on the modeling results can be found in Table 1 of the comments and in the full S&L analys is attached to the comments.) The commenter added

that modeled emissions for individual units ranged from 0.047 to 0.077 lb/MMBtu.

The commenter (0348) believes that S&L m odel results clearly demonstrate that a

0.055 lb/MMBtu NO x emission limit on a 30 BOD basis is unachievable at NGS, adding that S&L’s modeling results do not incl ude a compliance margin, which would be necessary to include when setting an emission limit. The commenter pointed out that th e historical data used in the modeling does not account for specific issues that c ould further increase the number of startups and shutdowns in the
future, as well as the need for additional low load cycling, such as:

 Intermittency of operation associated with increasing renewable energy generation.

 Lower natural gas prices and potential future ca rbon regulations or policies driving the use of natural gas fired generation in place of coal fired generation.

 Unexpected equipment failure at the plant or offsite (e.g., switchya rd and/or substation issues can cause additional transmission limitations).

 Fuel moisture issues (e.g., rain can cause increas ed moisture content in the fuel, contributing to boiler plugging and tube fouling).

 Events outside of the plant’s control, such as fo rest fires, which can have direct effects on the operation of the units due to transmission impacts.

For these reasons, the commenter believes that a compliance margin should be added to S&L’s calculated highest 30 day averages in order to establish an achievable permit limit for SCR at NGS. Based on these considerations, the commente r (0348) drew the following conclusions:

 The EPA’s proposed plantwide NO x emission limit of 0.055 lb/MMBtu on a 30 BOD rolling average basis is unachievable at NGS.

 Although some equipment vendors may assume a de sign basis as low as 0.03 lb/MMBtu for SCR under steady state conditions, a re view of other retrofit SCR ope rations indicates that actual

emissions will not achieve this level when f actors such as performance degradation between planned overhaul intervals and limitations on S CR performance in certain operating conditions including startups, shutdowns, and load cycl ing conditions are take n into consideration.

 Accordingly, while it may be possible to de sign an SCR for a basis of 0.03 lb/MMBtu, it is critical that sufficient compliance margin be in corporated in establishing an achievable permit limit that allows for reasonably expected pe rformance variability. To the commenter’s knowledge, there are no retrofit SCRs constructed and operating today – regardless of the NO x design basis – that demonstrate compliance w ith a permit limit of 0.055 lb/MMBtu on a 30 BOD rolling average basis when startups, shutdowns and load cycling conditions are required to be included in the average.

 Potential future operating conditions that have no t been encountered in the past must also be considered in establishing an achievable compliance limit. For example, integration of renewable resources into a utility’s generation fleet may create situations in which coal fired units such as those at NGS are being operated in lo ad cycling modes more frequently.Page 127

EPA Responses to Comments: Navajo Gene rating Station Final Rule | July 28, 2014  S&L’s analysis concludes that a higher emi ssion limit in the range of 0.07 to 0.08 lb/MMBtu may be achievable at NGS. However, as demons trated in S&L’s analysis, a compliance limit

established at the lower end of this range may require the NGS Pa rticipants to limit operation of the units in certain modes, unless future technol ogy advances allow the limit to be achievable over a broader range of operating conditions. A limit closer to 0.07 lb/MMBtu may also be achievable if startup, shutdown or load cycli ng conditions are excluded from the average.

Response:

EPA disagrees with the commenter that the BART limit for NGS should be higher than our proposed limit of 0.055 lb/MMBtu, in the range of 0.07 to 0.08 lb/MMBtu.

The commenter (0348) first cites to a comment submitted by Hitachi Power Systems of America (0037) that clarifies information Hitachi provided to EPA in 2011 re garding the ability of their SCR system to comply with a limit of 0.05 lb/MMB tu on a 30-day rolling average. In 2011, EPA corresponded with Hitachi representa tives about the design target require d for an SCR system to meet a

limit of 0.05 lb/MMBtu. 199 Specifically, EPA asked, “would Hitachi typically design down to 0.03

lb/MMBtu to meet a 0.05 limit?” In response, Hitachi stated, “All of our designs are based on the required NO x at the end of the guarantee period, so I do not think that in order to meet the 0.05 lb/MMBtu requirement, we would be required to design for a 0.03 lb/MMBtu requirement.” Based, in part, on information provided by Hitachi, that an SCR system based on a 3+1 design could meet a limit of 0.05 lb/MMBtu, even at the end of the guarantee period (i.e., just prior to catalyst replacement), EPA proposed a BART limit of 0.055 lb/MMBtu for Units 1-3 at NGS.

In 2013, Hitachi submitted a comment to the docket (0037) clarifying that “t o set the permit level of 0.055 lb/MMBtu on a design of 0.05 lb/MMBtu will be very difficult to achieve. Lowering the design to 0.03 lb/MMBtu will increase the volume of catalyst required and could drive the design to a 4 plus 1 and add significant cost to the project. We agree with the recomm endation in the S&L study that a 0.05 design is more appropriate with a 0.07-0.08 permit level.”

In EPA’s 2011 direct correspondence with Hitachi representatives, EPA attempted to understand Hitachi’s perspective regarding de sign targets and emission limits by asking whether a design target of 0.03 lb/MMBtu would be required to meet a limit of 0.05 lb/MMBtu. Hi tachi replied that it would not need to design to 0.03 lb/MMBtu. 200 In 2013, Hitachi reversed its previous statements and implied that it would need to design to 0.03 lb/MMBtu in orde r to meet a limit of 0.05 lb/MMBtu. In its 2013 comment, Hitachi also noted that, “Hitachi also stat ed that the utility and their engineer need to determine what margin needs to be applied to insure [sic] that the unit is capa ble of achieving less than the permit level on a 30-day rolling average.” 201 Consistent with Hitachi’s statement regarding coordination between the utility and its engineer ing firm, SRP submitted a study it commissioned with S&L to more closely examine whether the units at NGS would be able to meet an emission limit of 0.055 lb/MMBtu on a rolling 30-BOD average basis. Th erefore, we now focus our response on the S&L report commissioned by SRP.

199 See Email from Stephen Guglielmo, Hitachi, to Anita Le e, EPA, dated March 7, 2011, titled “2011_0307 Email from Stephen Guglielmo to Anita Lee”, in the docket for this rulemaking at EPA-R09-OAR- 2013-000 9-0004.

200 Id

. 201 We note that EPA has not been able to locate this statem ent, or a similar statement, in our 2011 correspondence with

Hitachi.Page 128

EPA Responses to Comments: Navajo Gene rating Station Final Rule | July 28, 2014 As described in the comment summary above, the S&L report generally argues that because the emission limit is established based on a 30-BOD average basis, the proposed emission limit of 0.055 lb/MMBtu is not consistently ac hievable at NGS. The S&L report se ems to suggest that excluding startup, shutdown, and load-cycling emissions from the BART limit might warra nt consideration. The BART Guidelines require that BART determinations for EGUs specify an averaging time of a 30-day rolling average and contain a definition of boiler operat ing day that is consistent with the definition in the proposed revisions to the NSPS for utility boilers in 40 CFR Part 60, subpart Da. 202 The proposed

revisions to the NSPS in 2005 included a definition for “boiler operating day”:

Boiler operating day for un its constructed, reconstr ucted, or modified on or before February 28, 2005, means a 24-hour period during which fossil fuel is combusted in a steam genera ting unit for the entire 24 hours. For units constructed, reconstructed, or modified after February 28, 2005, boiler operating day means a 24-hour pe riod between 12 midnight and the following midnight during which any fuel is combusted at any time in the steam generating unit. It is not neces sary for fuel to be combusted the entire 24-hour period.

The definition of boiler operating day was finalized as proposed. 203 Consistent with the BART Guidelines, EPA proposed a BART limit for NGS base d on the definition of BOD that means the 24- hour period during which any fuel is combusted at any time in the unit. Based on this definition of BOD, the averaging period includes period s of startups, shutdowns, and malf unctions, as well as emissions during load-cycling. EPA is not revising the averagi ng period or the definition of BOD, to exclude periods of certain types of opera tion, for the BART emission limit.

The S&L analysis begins by assuming that the S CR system would be designed to a target of 0.03 lb/MMBtu, and provides results, ba sed on 2012 operations data at NGS, th at suggests that even with a design target of 0.03 lb/MMBtu, the units at NGS woul d not be able to consis tently meet a limit of 0.055 lb/MMBtu due to periods of start up, shutdown, and load cycling operation. 204 The S&L analysis

concludes that even with a desi gn target of 0.03 lb/MMBtu, an emi ssion limit in the range of 0.07-0.08 lb/MMBtu would be required to accommodate the periods of load -cycling operation, startups, and

shutdowns. This conclusions means that S&L is esse ntially recommending a limit that is 2.3 to 2.7 times higher than the design target, or a compliance marg in of 133 to 167 percent. Although, in their 2013 comment (0037), Hitachi agrees with the 2010 S&L st udy that a 0.05 design is more appropriate with a 0.07-0.08 permit level, the S&L analysis submitted by SRP in 2013 (0348) argues that meeting a limit of 0.07-0.08 lb/MMBtu at NGS requires an even lower design target of 0.03 lb/MMBtu. Because SRP and

S&L recommend that EPA increase the BART limit to 0.07-0.08 lb/MMBtu (rather than an even higher limit), EPA concludes that SRP and S&L intend to de sign the SCR system with a design target of 0.03 lb/MMBtu, and that the updated 2013 cost estimates submitted by SRP a nd S&L are consistent with this intended design target. 205

202 The BART Guidelines cite to 70 FR 9705, February 28, 2005.

203 See 72 FR 32722 (June 13, 2007).

204 To prevent fouling of the catalyst fro m the formation of ammonium salts at low exhaust gas temperatures, ammonia injection (required for the catalytic reductions) will cease when the exhaust ga s falls below a certain temperature.

205 See the 2013 update to the S&L cost estimate report (included as an appendix to SRP’s comment (0348). S&L adjusted the initial volume of catalyst deployed in the SCR system to account for the revised design target of 0.03 lb/MMBtu. S&L had originally planned for a 2+2 catalyst system (with 2 layers of catalyst for initial deployment) to achieve a design target of 0.05 lb/MMBtu, and in the 2013 revised cost estimate, revised the design to be a 3+1 system (with 3 layers of catalyst for initial deployment).Page 129

EPA Responses to Comments: Navajo Gene rating Station Final Rule | July 28, 2014 The S&L report discusses the temperature lim itations associated with SCR, and assumes a minimum SCR design temperature of 580  F, which S&L asserts is typical for retrofit SCR control systems installed on coal-fired elect ric generating units with similar coal sulfur content. S&L explains that at temperatures below this minimum operating temperature, SCR operation (i.e., ammonia injection) must cease to prevent ammonium salt formation on th e catalyst. S&L states that this temperature corresponds with a gross load of approximately 650 MW (i.e., MWg). S&L further assumes that SRP will likely modify the units to increase flue gas te mperatures at lower operating loads by installing one of several options for low load temperature control. For their analysis, S&L assumes the low load temperature control would be achieved with a water-side bypass (to allow water to bypass the economizer tube bundles during low-load operation). The S&L report states “[b]ased on a preliminary review of the available systems, a water-side bypass system should be ca pable of increasing the temperature of the bulk flue gas by approximately 25  F to 65  F during low-load operation. For this evaluation, a low-load temperature control system capable of achie ving a temperature increase of 65  F during low-load operations was assu med for modeling purposes.” S&L fu rther estimates that this would correspond to a minimum gross load of 450 MWg for th e SCR to operate. Units 1-3 at NGS are rated at a net capacity of 750 MW. For comparison, EPA eval uated AMPD emission data, which includes hourly gross load. In 2001, the highest repo rted hourly gross load was 823 MWg. 206 Thus a load of 450 MWg roughly corresponds to a requirement that NGS operate at approximately 55% capacity in order to operate the SCR system. Using the assumption that the SCR would not operate at loads below 450 MWg, S&L used 2012 operations data at NGS to es timate emission rates at NGS assuming a design target of 0.03 lb/MMBtu with actua l steady-state operations achieving 0.04 lb/MMBtu (with periods of higher or lower emission rates associated with lo ad increases and decreases). S&L modeled eighteen different operating scenarios and id entified seven scenarios, which incl uded periods of low load cycling along with unit startup and shutdowns , that resulted in the maximum 30-BOD average for each unit and facility-wide, that exceeded 0.055 lb/MMBtu. The highest 30-BOD average S&L modeled was 0.077 lb/MMBtu for Unit 2, achieved under 3 different ope rating scenarios involvi ng low-load cycling.

SRP and S&L did not provide the underlying data used in the S&L analysis. Therefore, EPA evaluated the S&L report by reviewing AMPD emission data from multiple years at NGS, as well as

emissions data from other facilities that were constructe d or retrofit with SCR. EPA sought to understand 2012 operations at NGS within the context of longer term operational trends at the facility, as well as understand the minimum operating load assumed by S&L for NGS within th e context of minimum operating loads at other facilities with SCR.

EPA evaluated the reported hourly gross load opera ting data for Units 1-3 at NGS for the years 2001, 2003, 2010, 2011, 2012, and 2013. 207 EPA selected these years because they are years that include the baseline period for BART (i.e., 2001-2003) as well as recent years of opera tion. As shown in Table 9, in terms of the percentage of hours operated below 450 MWg (the assumed minimum operating load for SCR), NGS spent a higher percentage of ope rating hours at gross loads below 450 MWg in 2012 compared to other years. For Unit 2, the differenc es between 2012, compared to 2010 and 2013, are also shown below in Figures 3-5. 208 The horizontal red line indi cates a gross load of 450 MW.

206 See document titled “NGS Hourly Data for 4 years.xlsx” in th e docket for this final rulemaking, specifically, tabs titled U1_2001, U2_2001, and U3_2001. In the 2010 S&L cost study, S&L reported the gross MW for the boilers at NGS to be 812 MWg – see Appendix A to the 2010 Cost Study titled Design Basis. 450 MWg also represents roughly 55 percent of 812 MWg.

207 Id. , specifically the tab titled Summaries. See also document titled “NGS Hourly data for additional years.xlsx”.

208 Graphs of gross load for each unit, for each of the evaluate d years, are included in the two documents titled “NGS Hourly Data for 4 years.xlsx”, and “NGS Hourly data for additional years.xlsx”.Page 130

EPA Responses to Comments: Navajo Gene rating Station Final Rule | July 28, 2014 Table 9: Percentage of Hour s NGS Operated Below 450 MWg

Unit 1 Unit 2 Unit 3

2001 3.30% 1.02% 1.89%

2003 2.47% 2.70% 2.99%

2010 2.79% 5.77% 2.89%

2011 4.86% 3.87% 1.53%

2012 8.39% 9.42% 5.56%

2013 1.27% 2.33% 0.50%

Figure 3: Gross Load of Unit 2 in 2012

0 100 200 300 400 500 600 700 800 900

0 1000 2000 3000 4000 5000 6000 7000 8000 9000 NGS Unit 2 Gross Load (MW) ‐ 2012Page 131

EPA Responses to Comments: Navajo Gene rating Station Final Rule | July 28, 2014 Figure 4: Gross Load of Unit 2 in 2010

Figure 5: Gross Load of Unit 2 in 2013

The 2012 gross load profiles for Unit 2 (as well as Units 1 and 3) are ch aracteristic of loadcycling units, with significant pe riods of time below the SCR minimum operating load assumed by S&L of 450 MWg. This low-load cycling was especially pronounced in Spring 2012 (Figure 3). In 2010, as indicated in Table 9, Unit 2 also spent a slightly higher percentage of time at loads below 450 MWg. However, as shown in Figure 4, the significant peri ods of loads below 450 MWg occurred following the major outage on Unit 2, which was the same year LN B/SOFA was installed on that unit. Thus, the periods of low load appear to be associated with adjustments to Unit 2 occurring after a major outage, rather than periods of load-cycling. In 2013, the most re cent year of data available, Unit 2 did not spend

a considerable amount of time at loads below 450 MWg. Figure 5 shows that load-cycling was less pronounced in 2013 compared to 2012, and the cyc ling typically remained above 450 MWg. Although Units 1-3 at NGS did appear to operate as load-cycling units and ope rated below 450 MWg for significant periods of time in 2012, this type of operation does not appear to be characteristic of typical operation at NGS, based on our evaluation of previous years, as well as 2013. 0 100 200 300 400 500 600 700 800 900

0 1000 2000 3000 4000 5000 6000 7000 8000 9000 NGS Unit 2 Gross Load (MW) ‐ 2010

0 100 200 300 400 500 600 700 800 900

0 1000 2000 3000 4000 5000 6000 7000 8000 9000 NGS Unit 2 Gross Load (MW) ‐ 2013Page 132

EPA Responses to Comments: Navajo Gene rating Station Final Rule | July 28, 2014 Based on the gross load operating profiles for six years, combined with the S&L assumption that the SCR minimum operating load would be 450 MWg, and with the simplifying assumption that the units at NGS would achieve an average emission rate of 0.042 lb/MMBtu when the SCR is in operation (calculated as the average of S&L’s assumption that steady-state emissions at fu ll load would result in 0.040 lb/MMBtu, with 0.050 during load increases of 15 MW per hour or more and 0.035 lb/MMBtu when load decreases by 15 MW per hour or more), 209 EPA estimated the rolling 30-BOD averages for each BOD for the six years evaluated to determine wh ether the operating profiles (which included actual startup, shutdown, malfunction, and load-cycling in each year) would result in 30-BOD averages that would exceed 0.055 lb/MMBtu. For hours where the gross load was less than 450 MW, EPA used actual

NO x emitted (in pounds) during that hour, to represent emissions with SCR installed but not operating.

The results of EPA’s estimat es of potential 30-BOD NO x emission rates, using S&L’s assumption of an SCR minimum operating load of 450 MWg, and assuming average steady-state NO x emission rates at 0.042 lb/MMBtu, are shown in Table 10.

Table 10: EPA’s Evaluation of Potential M aximum 30-BOD Emission Rates for NGS Units Operating with SCR for Select Years Using S& L Assumption of SCR Minimum Operation Load of 450 MWg

Unit 1 Unit 2 Unit 3

2001 Number of 30-BODs > 0.055 0 0 0

Maximum 30-BOD 0.051 0.045 0.045

2003 Number of 30-BODs > 0.055 0 29 0

Maximum 30-BOD 0.045 0.066 0.48

2010 Number of 30-BODs > 0.055 0 29 0

Maximum 30-BOD 0.051 0.079 0.045

2011 Number of 30-BODs > 0.055 0 0 0

Maximum 30-BOD 0.054 0.054 0.049

2012 Number of 30-BODs > 0.055 75 100 0

Maximum 30-BOD 0.071 0.075 0.050

2013 Number of 30-BODs > 0.055 0 0 0

Maximum 30-BOD 0.047 0.046 0.043

Because SRP and S&L did not provide the underlying data on which their analysis and results were based, EPA was not able to use the S&L scenarios for our anal ysis and reproduc e their results. 210

However, for 2012, EPA did find that there were BODs in 2012 where Units 1 and 2 exceeded the proposed BART limit of 0.055 lb/MMBtu, and there were also BODs in other years in addition to 2012 that Unit 2 exceeded the proposed BART limit (i n 2003 and 2010). We note that the highest 30-BOD averages S&L projected were from Unit 2, at 0.07 7 lb/MMBtu, under their s cenarios 0B (low-load cycling for 120 days), 0B.1 (low-load cycling for 120 days with 96 hour shutdown and cold start), and 4C (60 days of full load cycling followed by 60-days of low load cycling). In EPA’s analysis, in 2012

209 To be conservative, EPA uses S&L’s assumptions of steady-state NOx emission rates at full load and during changes in load that would be achieved if the SCR system was designed to 0.03 lb/MMBtu. However, EPA notes that S&L did not provide detailed justification or citations for their assumed valu es. S&L asserts in Table 2-1 of their analysis, that modeled NOx rates are expected to average approximately 30% above the design target rate based on an analysis of other operating units. S&L did not provide this analysis. We note that if emissi on rates at full load average less than 30% above the design target, then the projected emission rates at NGS (as shown in Tables B and E) would be lower.

210 S&L modeled Scenarios 0 – 5, that included full-load cycling, low-load cycling, major outages, extended startups, cold startups, etc. S&L and SRP did not provide this analysis to EPA, therefore, EPA could not replicate S&L’s various operating scenarios. Therefore, EPA exam ined 6 years of actual hourly NGS data, which included actual startup and shutdown profiles in baseline and recent years, load-cycling (i.e., 2012) and major outages (e.g., 2010, and 2011).Page 133

EPA Responses to Comments: Navajo Gene rating Station Final Rule | July 28, 2014 (load-cycling), EPA projected th e highest 30-BOD to occur on Unit 2, at 0.075 lb/MMBtu, and for 2010 (major outage on Unit 2), we projected the maximum 30-BOD to be 0.079 lb/MMBtu on Unit 2. Therefore, although the s cenarios modeled by S&L and EPA are not identical, th e highest 30-BOD projected by EPA and S&L, using similar startin g assumptions, were comparable. EPA’s analysis, which included emission and operating profiles of act ual startup and shutdown events, and load-cycling in various years, showed that Unit 3 was not projected to exceed 0.055 lb /MMBtu in any of the evaluated years, and that there we re several years within these six selected years that Units 1 and 2

would also not exceed 0.055 lb/MMBtu.

The analysis of projected 30-BOD emission ra tes assumes that the S&L assumption, that the minimum operating temperature for SCR on Unit 1- 3 at NGS would correspond to a load of 450 MWg, is correct. As stated previously, this means that each unit must operate at approximately 55% capacity or higher in order for the SCR to operate. EPA notes that S&L’s use of 450 MWg was an assumed value based on preliminary analysis of available low load temperature control systems. SRP submitted a similar S&L analysis for Unit 1 and 3 at Coronado Generating Station (CGS). 211 Units 1 and 2 at CGS are 430 MW (gross) Riley-Turbo units that typica lly operate as load-cycling units. CGS burns lowsulfur coal from the Power River Basin (PRB). With the application of low-load temperature controls on these units, S&L’s preliminary analysis suggests th at the minimum operation load for SCR on Units 1 and 2 at CGS would be 138 MWg. This means that Un its 1 and 2 at CGS could operate at 32 percent capacity and still operate SCR. This is in contrast to the minimum operating load capacity in order to operate SCR at NGS of approximately 55 percen t. NGS does not burn PRB coal; however, NGS does

burn coal low-sulfur coal from the Kayenta Mine. AECOM, SRP’s c onsultant for visibility modeling, reported the maximum sulfur content of the coal of 0.593 percent based on daily data for the 2001-2003 period. For comparison, various sources reference PRB co al as generally low-sulf ur coal with a sulfur content of less than 1 percen t, or a mean of 0.5 percent. 212 In contrast, high sulfur coal is typically above 3 percent. 213

Information on the minimum operating load for S CR on other units is not readily available, however, this information can be approximated by examining AMPD data (graphing hourly NO x rate against hourly gross load). Table 11 shows the values for minimum operating load requirements for SCR at Coronado Generating Stati on assumed by S&L, the maximum gross load observed for 2013 for several well-performing facilities with SCR, and EPA’s estimates for each unit’s minimum operating load for SCR based on observed hourly NO x emission rates and hourly gro ss load data from 2012 and

2013. 214 Figure 6 is an example showing the hourly NO x rate at Comanche 3 in 2013 plotted against hourly gross load. The values in Table 11 for mi nimum operating load were estimated by visually estimating the load where hourly NO x rates begin to increase with decr easing load. The vertical red line in Figure 6 shows the minimum operating load EPA es timated for Comanche 3 in 2013. The values in Table 11 for estimated capacity required to opera te SCR were calculated by dividing the estimated minimum operating load by the maximum hourly gross load. These values are not based on information provided by SCR vendors for each facility and are simp ly estimates that are derived empirically by evaluating AMPD data for severa l well-performing facilities in 2012 and 2013. EPA chose to evaluate

211 See S&L study titled “Salt River Project (SRP) Coronado Generating Station Unit 1 SCR NOx Emissions Modeling” dated November 14, 2013, in the docket for this rule.

212 See, for example, publication from the U.S. Geological Survey, figure PQ-4 and Table PQ-1, available at http://pubs.usgs.gov/pp/p1625a/Chapters/PQ.pdf

. 213 Id.

214 See documents titled: “Wygen and DryFork 2012.xlsx”, “Wyg en and Dry Fork 2013.xlsx”, “TS Power 2012.xlsx”, “TS Power 2013.xlsx”, “Comanche 2012.xlsx”, “Comanche 2013.xlsx”, “Parish 2013.xlsx”, “Parish and Spruce 2012.xlsx”, and “Spruce 2013.xlsx”.Page 134

EPA Responses to Comments: Navajo Gene rating Station Final Rule | July 28, 2014 well-performing facilities to ensure that the facil ities analyzed use low-load temperature controls.

Facilities that do not use low-load temperature controls would not be comparable for this purpose (to understand the potential capabilities of low-load temperature controls at NGS) and would have higher estimated capacities required to operate SCR. This methodology may also tend to underestimate a unit’s capacity requirement to operate SCR because it relies on the highest gross load observed in the data set, rather than the actual value for maximum gross load for that unit. The graphs for all facilities in Table 11 showed similar profiles as Comanche 3 (Figure 6) except for the graph for TS Power (Figure 7). The graph for TS Power does not show a clear point were hourly NO x values increase with decreasing load, however, this may be a result of insufficient data point s at the very low loads. To be conservative, EPA estimated the minimum operating load for TS Power to be at the lowest loads of consistent operation; however, data points at lower loads than th is level also corres pond with low hourly NO x emission rates (see Figure 7). Based on the gross lo ad profiles, the facilities discusse d in Table 11 represent units that operated in 2012 and 2013 as baseload (i.e., Dry Fork, Wygen 2 and 3), and load-cycling (i.e., TS Power, Comanche 3, Spruce 2, and WA Parish 7 and 8). 215

Table 11: EPA Estimates for Minimum Operating Loads and Capacities Required to Operate

SCR for Several Well-Performi ng Facilities in 2012 and 2013

Facility Coal Source Year Maximum

Gross Load (MWg) Estimated

Minimum Operating Load Estimated Capacity Required

to Operate SCR

Dry Fork PRB 2012 447 181 40%

2013 453 208 46%

Wygen 3 PRB 2012 114 45 39%

2013 116 49 42%

Wygen 2 PRB 2012 101 44 44%

2013 102 45 44%

TS Power PRB 2012 241 < 94 * < 39%

2013 240 < 95 * < 40%

Comanche 3 PRB 2012 827 288 35%

2013 806 308 38%

Spruce 2 PRB 2012 826 324 39%

2013 824 333 40%

WA Parish 7 PRB 2012 614 220 36%

2013 614 251 41%

WA Parish 8 PRB 2012 654 240 37%

2013 654 254 39%

Coronado Units 1

and 2 PRB From S&L 430 138 32%

* An estimate for minimum operating load for TS Power is more difficult to discern compared to other facilities. To be conservative, EPA estimated the minimum operating load for TS Po wer to be at the lowest loads of consistent operation (see
Figure E and red vertical line), however, data points at lower loads than this level also correspond with low hourly NO x emission rates.

215 Id.Page 135

EPA Responses to Comments: Navajo Gene rating Station Final Rule | July 28, 2014 Figure 6: 2013 Hourly NO
x Rate Plotted Against 2013 Hourly Gross Load for Comanche 3

Figure 7: 2013 Hourly NO
x Rate Plotted Against 2013 Hour ly Gross Load for TS Power

The average of the estimated capacities required to operate SCR for the facilities shown in Table 11 is 39 percent. If we exclude Coronado Units 1 and 2 (the lowest required capacity and the units where SCR has not yet been installed), the average capacity is 40 percent. The highest capacity required, from the evaluated units, is 46 percent. If we apply the average (40 percent) and maximum (46 percent) values for the required capacity to operate SCR at these facilities, to the maximum capacity from 2001 that EPA estimated for NGS (823 MWg), a reasonable range of possible required capacities to operate SCR at NGS could be 330 MWg to 379 MWg. Although th ese values appear to EPA to be reasonable and conservative minimum operating loads compared to existing well-performing facilities, EPA is not asserting that these values for minimum operating load will be the values that result after a full engineering evaluation is conducted specifically fo r NGS by S&L. S&L’s estimate of 450 MWg was an assumed value based on preliminary review of available low-load temperature control systems, and S&L did not provide justification for this value or their assumptions made in selecting this value. EPA’sPage 136

EPA Responses to Comments: Navajo Gene rating Station Final Rule | July 28, 2014 analysis of other well-performing f acilities that burn low-sulfur coal is intended to provide a reasonable range of possible capabilities of low-load temperat ure control systems for S CR at NGS, in order to examine the effect of the SCR minimum operating load on the ability of NGS to meet an emission limit of 0.055 lb/MMBtu. As shown in Table 10, Unit 2 at NGS is projected to exceed 0.055 lb/MMBtu (30- BOD average) using operations data from 2003, 2010, 2011, and 2012, and Unit 1 is projected to exceed 0.055 lb/MMBtu (30-BOD average) using opera tions data from 2011 and 2012, based on S&L’s assumed minimum operating load of 450 MWg and an assumed average steady- state emission rate 0.042 lb/MMBtu. Unit 3 was not projected to exceed 0. 055 lb/MMBtu in any of the years that EPA

evaluated. 216 Table 12 shows EPA’s projections for the 30-B OD averages that would result (for the units and years that exceeded 0.055 lb/M MBtu using S&L’s assumed mini mum operating load of 450 MWg) if the minimum operating load was 379 MWg or 330 MWg (corresponding approximately to a 46 percent and 40 percent capacity requirement to operate SCR).

Table 12: EPA Projections for Maximum 30-BOD for Select Units and Years at NGS Using Different Minimum Operating Loads for SCR
450 MWg Minimum Operating Load (55% capacity) 379 MWg Minimum Operating Load (46% capacity) 330 MWg Minimum Operating Load (40% capacity)

Unit 1 in

2012 # 30-BOD > 0.055 75 7 0

Maximum 30-BOD 0.071 0.057 0.043

Unit 2 in

2003 # 30-BOD > 0.055 29 0 0

Maximum 30-BOD 0.066 0.048 0.045

Unit 2 in

2010 # 30-BOD > 0.055 29 9 0

Maximum 30-BOD 0.079 0.057 0.055

Unit 2 in

2012 # 30-BOD > 0.055 100 18 0

Maximum 30-BOD 0.075 0.059 0.046

Table 12 shows that if the low-load temperature control system at NGS allows NGS to operate SCR when running at 46 percent capacity or great er, the highest predicte d 30-BOD average was 0.059

lb/MMBtu for Unit 2 in 2012. If the low-load temperature control syst em allows operation of SCR when running at 40 percent capacity, the highest predicted 30-BOD average was 0.055 lb/MMBtu for Unit 2 in 2010. As noted above, operation of NGS in 2012 was characterized by extended periods of loadcycling that was not observed to th e same extent in 2013 or any of th e previous four years that EPA examined. Operation of Unit 2 in 2010 was unique comp ared to previous years and compared to Units 1 and 3 (none of the 30-BOD averages predicted fo r Units 1 and 3 exceeded 0.055 lb/MMBtu in 2010).

Installation of LNB/SOFA on Unit 2 occurred in 2010 during the unit’ s scheduled major outage. As shown in Figure 4, in the month following the major ou tage, Unit 2 appeared to be subject to frequent cycling down to very low loads in a manner that was not observed in any unit in any other year that EPA examined. Although EPA is unaware of the purpose or cause of the extreme low-load cycling observed in the month following the major outage on Unit 2, th is mode of operation appears to be unique and atypical for NGS.

The S&L report concludes that even with a desi gn target for SCR of 0.03 lb/MMBtu, a limit of 0.07-0.08 lb/MMBtu is required to accommodate periods of startup, shutdown, and load-cycling operation. EPA agrees that load-cyc ling operation appears to be an important factor, however, EPA

concludes that the critical S&L a ssumption, that the units at NGS mu st operate at approximately 55

216 See the two documents titled “NGS Hourly Data for 4 years. xlsx”, and “NGS Hourly data for additional years.xlsx”.Page 137

EPA Responses to Comments: Navajo Gene rating Station Final Rule | July 28, 2014 percent capacity in order for the SCR to operate, was not sufficien tly supported and was acknowledged by S&L to be an assumption based on a preliminary review of available low-load temperature control systems. EPA also notes that in the S&L revised 2013 cost analysis, S&L included costs for hot water recirculation systems which “maintains SCR in operation at all plant operating loads” (emphasis added). 217 EPA evaluated emission data of eight well -performing units and generated empirical estimates for SCR minimum operating loads and cap acity requirements for SCR operation for those facilities. This analysis resulted in estimated cap acity requirements for SCR operation that ranged from 35 percent to 46 percent, with an average value of 40 percent. Using the aver age (40 percent) and the maximum (46 percent) capacity requirement to opera te SCR, EPA projected that NGS could meet a limit of 0.055 lb/MMBtu (on a 30-BOD average) for all but 3 unit-years (i.e., Un its 1 and 2 in 2012, and Unit 2 in 2010) under the 46 percent capacity requirem ent. Under the 40 percent capacity requirement to run SCR, EPA’s highest projected emission rate was 0.055 lb/MMBtu for Unit 2 in 2010. Operation of Unit 2 in 2010 was not typical of normal operatio n, and operation of NGS in 2012, as a load-cycling facility, is also not representative of normal operation.

The commenter argues that load affects the ability of load-cyc ling operation to maintain 30-BOD

emission rates below 0.055 lb/MMBtu is the minimum gross load required to operate SCR. S&L did not provide justification for their select ed value, and a review of other ba seload and load-cycling facilities operating with SCR, that also burn low-sulfur coal, suggests that it is reas onable to expect SCR to operate at lower loads sufficient to accommodate low-load cycling at NGS. If low-load temperature control systems at NGS allow the units to operate SCR while runni ng at 40 percent capacity (i.e., equivalent to the average capacity requirement to run a SCR observed at well-performing facilities operating SCR that burn low-sulfur coal), th en a limit of 0.055 lb/MMBtu would sufficiently

accommodate emission rates achievable at NGS duri ng the load-cycling operations observed in 2012.

The commenter also argues that the BA RT emission limit must account for unexpected malfunctions at the facility, potential events outside of the facility’s control th at have direct impacts on transmission (e.g., forest fires), and the potential for boiler plugging and tube fouling as a result of fuel moisture issues resulting from rain. EPA does not ag ree that the BART emission limit must account for unexpected malfunctions or events outside of the fac ility’s control. Because EPA evaluated six years of actual emissions and operations data from NGS, the potential effects of rain on boiler plugging and tube fouling purported by the commenter ar e likely included in the existing data set. To the extent that the commenter is suggesting a potential effect of rain on SCR performance at low loads, the commenter did not provide any information to char acterize or quantify such effects. Therefore, EPA di sagrees that we

must consider the effects of ra in in the BART emission limit.

The commenter also argues that NO x emissions achieved in other SCR retrofit situations do not justify the proposed emission limit of 0.055 lb/MMBtu, citing to the pr oposed replacement of the FIP’s BART determination for San Juan Generating Station (SJGS) with the New Mexico SIP, emission rates from WA Parish Units 7 and 8, statements associat ed with EPA’s national rulemaking for CSAPR, and higher BART limits established for North Dakota and South Dakota EGUs. Th e commenter correctly notes that EPA is in the process of replacing the FIP with a SIP fr om New Mexico at SJGS proposing

closure of two units and installa tion of SNCR on the remaining two units. In response to a previous

comment that BART must be cons istent with emission limits estab lished as BACT, EPA stated that BACT limits may provide important information, but should not be construed to automatically represent the most appropriate BART limit representative of a given technology for a given facility. Similarly,

217 See page 1-2 of the Sargent and Lundy report prepared for SRP, dated January 2, 2014, included as Appendix U to the SRP comment letter in the docket for this rulemaking (comment number 0348).Page 138

EPA Responses to Comments: Navajo Gene rating Station Final Rule | July 28, 2014 emission limits established as BART for other faciliti es (e.g., in North and South Dakota, as cited by the commenter, as well as for EGUs in Wyoming and th e Four Corners Power Plant on Navajo Nation), should not be construed to automatically represent the most appropriate BART limit for NGS. BART is a case-by-case determination and appropriate emission limits should be set, not only by considering the performance of air pollution techno logy at similar facilities, but also with consideration of sourcespecific factors. 218 In addition, broad statements made in a national rulemaking on th e ability of SCR to achieve specific emission rates acros s the national fleet of coal-fired EGUs should also not be construed to represent the appropriate limit in a source-specific case-by-case analysis.

In a response to a previous comment that BA RT for NGS should be a limit of 0.04 lb/MMBtu, EPA stated that units that operate within an emi ssion trading program (e.g., WA Parish 7 and 8) provide useful information on the performan ce capability and variability of units that have been retrofit with SCR, but that they are less relevant , compared to site-specific vendor information or the performance of similar units with permit limits, for making a case-by-case determination of BART for a specific facility. The ability of the WA Parish 7 and 8 to maintain steady-state emission rate s below 0.04 lb/MMBtu is informative because it indicates that long term steady-st ate emissions rates can be achieved at that level. However, because these units are not subject to an emission limit, these units are not required to maintain emission rates below a certain level, an d, as noted by the commenter, 30-BOD emission rates

from these units have exceeded 0.055 lb/MMBtu.

EPA notes that there are at least six EGUs that operate with SCR th at are also required to meet permitted emission limits for NO x . These six units were all new units , rather than re trofit units. Although SCR performance on new units and retrofit units are generally believed to be less directly comparable, finding a unit retrofit with SCR that is currently in operation with a permit limit is difficult. 219 Permit limits are set when a permit (typically a pre-constructi on PSD or NSR permit) is required as a result of increases in air pollutant emissions that exceed specific thresholds. Pre- construction permits are typically triggered for new facilities, or major m odifications to existing facilities. New facilities typically trigger permit requirements for several pollutants, including NO x , which therefore requires limits for each of those triggering pollutants. Th e installation of SCR at an existing source would typically not trigger a PSD permit for NO x emission increases (because SCR should result in a reduction

of NO x emissions), therefore, SCR retrofits would ge nerally not be subject to a permit limit for NO x , even if PSD is triggered for emi ssion increases of other pollutants. 220 In addition, permit limits are not established under emission trading pr ograms, e.g., CAIR. Therefore, AMPD emissions data appears, at this time, to generally be limited to new units that operate under NO x emission limits, and retrofit units that operate under a trading program without a NO x emission limit. Therefore, a thorough understanding of SCR performance warrants an examinati on of both new units and retrofit units.

As stated previously, WA Parish 7 and 8 are un its that were retrofit with SCR that achieve 30- BOD emission rates that, in 2012 and 2013, ranged from 0.043 to 0.051 lb/MMBtu (see Table 13).

218 For example, the BART emissi on limit, achievable with SCR, that EPA set for the units at Four Corners Power Plant was higher due to site-specific factors, in cluding characteristics of the boilers us ed FCPP and potential operational issues associated with installation of modern LNB to further reduce NOx in upstream of the SCR. See 77 FR 51620 at 51636 (August 24, 2012).

219 EPA notes that once BART units that are required to insta ll SCR, and meet BART emission limits, come online, more “achieved in practice” data will be available for comparison.

220 EPA notes that an exception to this is the PSD permit issu ed to NGS for significant emissi on increase of carbon monoxide (CO) resulting from the insta llation of LNB/SOFA. Because of the inverse relationship between CO and NOx emissions, EPA set a limit for NOx to ensure that attempts to reduce CO em issions during the CO demonstration period would not be at the expense of NOx emissions. See page 5 of the document titled “Final NGS PSD Permit AZ 08-01.pdf” located in the docket for this rulemaking at EPA-R09-OAR-2013-0009-0005.Page 139

EPA Responses to Comments: Navajo Gene rating Station Final Rule | July 28, 2014 Although the commenter noted that NO x emissions from WA Parish 7 exceeded 0.055 lb/MMBtu during

several months since SCR was installe d, the ability of the WA Parish 7 and 8 to sustain emission rates of

NO x below 0.05 lb/MMBtu indicates that low steady-state emission rates have been achieved in practice by units that are retrofit with SCR. Table 13 also shows the six units th at were constructed as new units designed to operate with SCR a nd subject to permit limits for NO x . These permits limits were likely

established as BACT limits. In a previous response to a comment, that BART should be a limit of 0.04 lb/MMBtu, EPA stated that the 0.05 lb/MMBtu emission limits establis hed for several facilities on a rolling 12-month average should not be construed to mean that BART emission limits, established on a rolling 30-BOD basis, should be lower than 0.05 lb/MMBtu. Although these limits should not be

construed to define what BART s hould be for NGS, the SCR performa nce at these facilities is still instructive. Dry Fork, TS Power, Wygen 3, and Spruce 2 were capable of sustaining, over 2012 and 2013, rolling 30-BOD emission rates be low 0.055 lb/MMBtu. Facil ities with higher em ission limits, i.e., 0.07 lb/MMBtu for Wygen 2 and Comanche 3 show ed higher 30-BOD emission rates. The emission limits for Wygen 2 and Comanche 3 are likely higher because they were established in permits issued earlier than the permits for the better-performing facilities. 221

Table 13: NO
x Emission Rates (lb/MMBtu) of Well -Performing Facilities with SCR

BACT

Limit Averaging

Period Year Maximum

30-BOD

Achieved Annual Average Ratio Max

30-

BOD:Annual Avg Ratio

Limit:Achieved

WA Parish

7 N/A N/A 2013 0.043 0.040 1.07 N/A

2012 0.046 0.042 1.09

WA Parish

8 N/A N/A 2013 0.043 0.040 1.07 N/A

2012 0.051 0.049 1.03 Dry Fork 0.05

lb/MMBtu 12-month rolling 2013 0.040 0.037 1.08 1.35

2012 0.039 0.037 1.07 1.35

TS Power 0.067

lb/MMBtu 24-hour rolling 2013 0.051 0.044 1.15 1.10 *

2012 0.050 0.043 1.14 **
Wygen 3 0.05

lb/MMBtu 12-month rolling 2013 0.043 0.042 1.04 1.19

2012 0.047 0.042 1.13 1.19 Wygen 2 0.07

lb/MMBtu 30-day rolling 2013 0.063 0.062 1.02 1.13

2012 0.0632 0.0625 1.01 1.12

Comanche

3 0.07

lb/MMBtu 365-day rolling 2013 0.068 0.067 1.02 1.04

2012 0.07 0.068 1.03 1.03 Spruce 2 0.069

lb/MMBtu 30-day rolling 2013 0.053 0.045 1.18 1.30

2012 0.044 0.041 1.10 1.57 Spruce 2 0.05

lb/MMBtu 12-month rolling 2013 0.053 0.045 1.18 1.11

2012 0.044 0.041 1.10 1.22

* For 2013, EPA calculated the maximum daily NO x rate to be 0.061 lb/MMBtu for TS Power.

** Based on emission data from AMPD, EPA calculated a maximum daily NO x rate of 0.0797 lb/MMBtu for TS Power. This maximum daily rate exceeds the permitted emission limit of 0.067 lb/MMBtu (24-hour rolling average).

For the eight well-performing units operating with SCR shown in Table 13, the ratio of the observed maximum 30-BOD average to the observed a nnual average ranged from 1.01 to 1.18. For these

221 For example, Comanche Unit 3 was proposed and approved in 2004. See “Plant History” at http://www.xcelenergy.com/About_ Us/Our_Company/Power_Generatio n/Comanche_Generating_Station . The permit for Wygen 2 was issued in 2003. Permits for Dry Fork, Wygen 3, were issued in 2007 and for TS Power in 2005. See document titled “2014_0228 Limited RBLC results.pdf” in the docket for this rulemaking.Page 140

EPA Responses to Comments: Navajo Gene rating Station Final Rule | July 28, 2014 units, the ratio of their permitted emission limits to observed emission rates (i.e., maximum 30-BOD achieved for units with permit limits averaged over 30- days, or the annual average for units with permit limits averaged over a 12-month period), showed c onsiderable variability and ranged from 1.03 to 1.57. The highest value of 1.57 was observed in 2012 for the 30-day rolling averag e limit for Spruce 2. EPA notes that Spruce 2 operates with two different permitted NO x limits over two different averaging periods, and that the ratio of the 12-month roll ing limit to the annual av erage in 2012 was 1.22. The commenter cites to regional haze actions for Nort h Dakota and South Dakota where the state or EPA provided a compliance margin in the BART emission limit. For example, in the North Dakota action where EPA concurrently proposed a FIP for portions of the SIP it proposed to disapprove, including

NO x limits for the Milton R. Young Station, EPA st ated “in proposing a BART emission limit of 0.07 lb/MMBtu, we adjusted the annual design rate of 0.05 lb/MMBtu upwards to allow for sufficient margin of compliance for a 30-day rolling average limit th at would apply at all times, including startup, shutdown, and malfunction.” 222

EPA evaluated six years of operations and emi ssions data from Units 1-3 at NGS, along with information supplied by the commenter and S&L, as well as SCR performance information from eight well-performing units. The six years of data from NGS includes periods of startup, shutdown, and malfunction, as well as load-cycling operations in 2012 that were not characteristic of normal operation at NGS, but, as asserted by the commenter, may be more common in the future. Based on these six years of data, and EPA’s evaluation of other facilities to understand SCR performance, EPA projected 30-

BOD emission rates that can be re asonably expected from the instal lation and operation of SCR at NGS. As shown in Table 10 and 12, a limit of 0.055 lb/MMB tu for Units 1-3 at NGS is sufficient to accommodate normal operation of most units (e.g., 2001, 2003, 2011, and 2013), including periods of startup and shutdown. The proposed BART limit is also sufficient to accommodate load-cycling operations (based on 2012 load profiles), as well as operations of Unit 2 in 2010, that may have been characteristic of boiler tuning or corrections following installation of new combustion controls, provided that the load capacity requirement (with low-load temperature controls) to operate SCR at NGS is consistent with the average capacity requirement s observed at other well -performing facilities.

In summary, EPA is determining that a BA RT Benchmark based on an emission limit for NGS of 0.055 lb/MMBtu on a rolling 30-BOD basis is appropr iate. In determining the achievability of this limit, EPA has conducted an analysis that considers periods of st artup, shutdown, malfunction, and lowload cycling. Therefore, this conclusion is cons istent with EPA statements elsewhere (e.g., EPA’s proposed action for the North Dakota Regional Haze SI P) that BART limits should allow for sufficient margins of compliance for startup, shutdown, and malfunction). Based on th e understanding that S&L would design the SCR system at NGS to a design ta rget of 0.03 lb/MMBtu and achieve average rates at full load of roughly 0.042 lb/MMBtu , the BART limit of 0.055 lb/MMB tu represents a 31 percent compliance margin to accommodate periods of star tup, shutdown, and load-cycling operation. If the low-load temperature control syst ems deployed at NGS are able to allow operation of SCR below 40 percent load, the operator of NGS will have even more flexibility in the compliance margin for meeting

the limit of 0.055 lb/MMBtu.

222 See proposed rule at 76 FR at 58,610 (September 21, 2011). In taking final action, we note that EPA did not finalize the proposed emission limit of 0.07 lb/MMBtu for Milton R. Young Station, and instead, approved the state’s BART determination for that facility. See final rule at 77 FR at 20897 (April 6, 2012).Page 141

EPA Responses to Comments: Navajo Gene rating Station Final Rule | July 28, 2014 Comment: Presumptive BART

A CAP agricultural water users group (0305), two of the owners of NGS (0314, 0348), and the operator of the Kayenta Mine (0384) noted that with existing LNB/SO FA controls, NGS’s NO x emission rate is below the presumptive limit of 0.28 lb/MMBtu established by the EPA in the BART Guidelines (citing 70 FR 39172, Table 1). The commenters assert that the installa tion of these advanced combustion controls should satisfy the BART requirement for the first planning period. These commenters generally indicated that in establishing this presump tive limit EPA stated that it “ believe[s] that [the presumptive limits] are extremely likely to be appropriate for all gr eater than 750 MW power plants subject to BART ” (citing 70 FR 39131) because the EPA c oncluded that the cost of controls required to meet the presumptive limits was reasonable.

One of these commenters (0384) included addi tional citations from the July 2005 final rulemaking for the RHR and other rulemakings to stress EPA’s conclusions in those rules that combustion controls are presumptive BART for elect ric generating units (EGUs) because they are cost effective and are likely to result in a substantial degree of visibili ty improvement. The commenter also quoted EPA as addressing possible in dividual cases in which a facility is unable to meet its presumptive limit using current combustion control technology w ith the recommendation to consider of “whether

advanced combustion control technologies such as rotating opposed fi re air should be used to meet these limits” (citing 70 FR 39172), with no reference to considering post-combustion controls. The commenter noted that BART rules include only tw o narrow exceptions where post-combustion controls should be considered: (1) cyclone un its and (2) units that already use post-combustion controls for part of the year, for which year-round use of the contro ls is presumptively BART (citing 70 FR 39171). The

commenter concluded from these historic citations that NO x BART emission limits are to be based on combustion controls, not post-combustion controls such as SCR.

Another commenter (0305) acknowledged that the BART Guidelines provide that the reviewing agency “may determine that an alternative control level is appropria te based on a careful consideration of the [five] statutory fa ctors” (citing 40 CFR part 51, Appendix Y, section IV.E.5), but asserted that EPA’s departure from presumptive BART, its conc lusion that a 0.055 lb/MMBtu limit is technically feasible, and its selective reliance on CAMD data to justify such a conclu sion are not adequately justified and, furthermore, are arbitrary, capriciou s, and an abuse of discretion. The commenter also stated that to properly justify departure from the presumptive BART limit, EPA must evaluate the impacts of the presumptive BART limit in its five-factor analysis , which it did not do.

Response:

EPA disagrees with the comment that installa tion of LNB/SOFA at NGS should satisfy BART because it meets the presumptive limit for NO x of 0.28 lb/MMBtu in the BART Guidelines for tangential-fired boilers burning bituminous coal. As noted in other responses in this document, the presumptive NO x limits established in the BART Guidelines are determined to be cost effective and appropriate for most units. The establishment of presumptive BART limits, and the corresponding technology upon which those limits are based, does not pr eclude states or EPA from setting limits that differ from those presumptions. Indeed, the five stat utory factors enumerated in the BART Guidelines provide the mechanism for establishi ng different requirements. EPA’s si te-specific five-factor analysis for NGS demonstrates that, in considering the exp ected remaining useful lif e of NGS and the existing controls, SCR is cost effective, results in the mo st visibility improvement of all feasible control technologies, and that the potential energy or non-air qual ity environmental impacts do not warrant its elimination as the top control option. As a result, regardless of the a ppropriateness of SCR as a controlPage 142

EPA Responses to Comments: Navajo Gene rating Station Final Rule | July 28, 2014 technology for most units on a national scale, or the extent to which EPA considered SCR in establishing the presumptive limits, the site-specific five-factor analysis performed for NGS justifies a

different NO

x BART limit than the presumptive NO

x BART limit. We note the RHR states:

States, as a general matter, must requi re owners and operators of greater than 750 MW power plants to meet these BART emission limits. We are establishing these requirements base d on the consideration of certain factors discussed below. Although we be lieve that these requirements are extremely likely to be appropriate for all greater than 750 MW power plants subject to BART, a State may establish different requirements if the State can demonstrate that an alternative determination is justified based

on a consideration of the five statutory factors.

The RHR also states:

If, upon examination of an individual EGU, a State determines that a different emission limit is appropriate based upon its analysis of the five factors, then the State may apply a more or less stringent limit.

Therefore, the presumptive emission limits in the BART Guidelines are rebuttable. The presumptive emission limits apply to power plan ts with a total genera ting capacity of 750 MW or greater insofar as these sources are required to adopt emission limits at least as stringent as the presumptive limits, unless after considering the five statutory factors, the State determines that the presumptive emission limits are not appropriate. Moreover, the RHR and BART Guidelin es do not exempt states from a five factor BART analysis, and that BART analysis may result in a determination of BART emission limits that are more or less stringent than the presumptive em ission limits for subject to BART sources. The RHR

states:

For each source subject to BART, 40 CFR 51.308(e)(1)(ii)(A) requires that States identify the level of control representing BART after considering the factors set out in CAA section 169A(g), as follows:

States must identify the best system of continuous emission control technology for each source subject to BART taking into account the technology available, the costs of compliance, the energy and non-air quality environmental impacts of compliance, any pollution control equipment in use at the source, the re maining useful life of the source, and the degree of visibility improvement that may be expected from available control technology.

EPA disagrees with the assertion th at we did not evaluate the impacts of the presumptive BART limit in our five-factor analysis. The pr esumptive BART limit of 0.28 lb/MMB tu is based on installation and operation of modern combustion controls. EPA ev aluated LNB/SOFA (at a limit of 0.24 lb/MMBtu,Page 143

EPA Responses to Comments: Navajo Gene rating Station Final Rule | July 28, 2014 which is each unit’s existing permitted NO x limit for operation with LNB/SOFA) in the five-factor analysis on which our proposed rule was based. 223

Comment: Install SCR within 3.5 years

One environmental advocacy group (0373) stated that the CAA requirement for BART to be installed “as expeditiously as prac ticable” requires installation and full implementation of SCR on all three units at NGS within 3.5 years, not later than 2018, rather than a llowing the facility 5 years. The commenter pointed out that the CAA often mandates co mpliance “as expeditiously as practicable, but in no event later than a set number of y ears” – as Congress required for BART.

According to the commenter, judicial opinions interpreting similar “as expeditiously as practicable” compliance dead lines read this language to require co mpliance as soon as possible, not as providing a 5-year default deadline in all instances. The commenter stated that because the “as expeditiously as practicable” compliance deadline “appear [s] in several places in [the] statutory text,” it is “generally read the same way each time it appears” (Citing Ratzlaf v. United States , 510 U.S. 135, 143 (1994)). The commenter added that when the CAA re quires compliance as expeditiously as practicable

but not later than a certain date, the date listed in the statute is an “outside date” and does not provide a “license” for a state or regulated entity “to take its time in complying with” the Act (citing Am. Lung

Ass’n v. Kean , 856 F. Supp. 903, 908 (D.N.J. 1994); Individuals for a Better Env‘t v. Wilson , 775 F. Supp. 1291, 1298 (N.D. Cal. 1991) (similarly noting that th e “as expeditiously as practicable, but in no event later than” standard provides an “outside lim it” for compliance)). The commenter also indicated that compliance before the “outside date” is requir ed whenever earlier comp liance is possible (citing

Union Elec. Co. v. EPA , 427 U.S. 246, 259 (1976)).

The commenter then cited severa l sources as evidence that SCR sy stem can be installed in less than 5 years. 224 The commenter added that with multiple S CRs for the same plant, there are numerous duplicative design, engineering, procurement, fabric ation, installation, and co mmissioning synergies, that can speed up the overall timeline. The commente r stated that EPA provide d no site-specific factors at NGS that would require a longer -than-average installation time for SC R (particularly in light of the fact that it appears cont ractors in the region will not be overwhelmed). The commenter concluded that the proposed 5-year compliance deadline fails to m eet the requirement that SCR be installed “as expeditiously as practicable,” and that EPA should set a 3.5-year compliance deadline for SCR

installation at NGS.

223 As noted elsewhere in this document and in our proposed rulemaking, EPA issued a PSD permit to NGS in 2008 for the

installation of LNB/SOFA on each unit over a three year peri od (2009-2011). The permit wa s required fo r significant emission increases of carbon monoxide; however the permit established a NO

x limit of 0.24 lb/MMBtu, based on the value SRP expected to achieve with LNB/SOFA, b ecause of the relationship in balancing NO

x and CO emissions from combustion.

224 The cited sources included: (1) EPA’s Engineering and Economic Factors Affecting The Installation of Control Technologies for Multipollutant Strategies , 22 (2002) (it generally takes 21 months to design, install, and test one SCR unit, and approximately 35 months for SCR installation at power plants with multiple SCR units); (2) 75 FR 45210, 45273, August 2, 2010 (proposed Transport Rule) (It takes approximately 21 months to construct a SCR unit to reduce emissions of NOx.); (3) ICAC’s Selective Catalytic Reduction (SCR) Control of NOx Em issions From Fossil Fuel-Fired Electric Power Plants (2009); (4) EPA Region 6, Complete Response to Comments for NM Regional Haze/Visibility Transport FIP , Docket EPAR06-OAR-2010-0846, at 71-72 (August 5, 2011) (in the BART determination for SJGS, the EPA concluded that past SCR installations have required an average of between 37 and 43 months to design and construct); (5) Supply Chain and Outage Analysis of MISO Coal Retrofits for MATS , The Brattle Group, May 2012 (a range of studies and practical experience have identified that SCR can typically be installed in less than 5 years).Page 144

EPA Responses to Comments: Navajo Gene rating Station Final Rule | July 28, 2014 Response:

EPA disagrees with the commenter that a 3.5 ye ar compliance deadline is practicable for NGS. EPA agrees that there are numerous sources of in formation, including EPA’s response to comments on its BART determination for the San Juan Generating Station, to suggest that on average, installation times for SCR can range from 37 to 43 months to desi gn and construct. As with any average value, there

will be individual cases where installation of controls requires more time than average, and cases where installation requires less time than av erage. The commenter also cites to EPA documents suggesting that it generally takes 21 months to design, install, and test one SCR unit, and 35 m onths for SCR installation at power plants with multiple SCR units, and another publication that suggests that SCR can be installed in less than 5 years (i.e., document from The Bra ttle Group). The Brattle Group estimated a duration of 47 months (nearly 4 years) to complete an SCR retrof it, and stated that “our estimates will tend to be on the high end compared to some other sources (inc luding the EPA) because they are compiled to the extent possible from industry participants’ experiences on a selection of actual projects, some of which experienced various permitting, cont racting or installation delays.” 225 The Brattle Group does not specify whether this duration of 47 months is repres entative of a single SCR unit, or multiple SCR units at a facility. However, given its statements that it s estimates are closer to industry estimates than EPA estimates, and its previous references to other in dustry studies suggesting an average duration of 40 months to retrofit one SCR, EPA in terprets the Brattle Group estimate of 47 months (nearly 4 years) to

represent one unit, not multiple units at one facility. 226

The Brattle Group estimate accounts for time required for the pre-construction permitting process that is required to be complete before any construction may commen ce on a project but did not specify how much of the 47 months permitting was assumed to require. 227 The EPA estimate of 35 months was one example of the time required for th e installation of multiple (seven) SCR units at a specific facility. EPA noted that its general timelines for retrofit installations included permitting, and assumed the pre-construction permit from the state or local regulatory agency would require nine

months. 228 In addition, although EPA cited to one facility where the retrof it of seven units required 35 months, EPA also stated “ideally, longer than 35 mont hs would allow for all the retrofits to occur over a period of several years so that facility owners can properly plan outages and suppliers can properly plan for resource availability.” 229

For NGS, EPA notes that three units would be retr ofit with SCR, and that there is no state or local permitting authority with jurisdiction to issue a pre-construction permit to a facility located on the Navajo Nation. As such, EPA would be the permitt ing authority for a PSD or minor NSR permit for NGS. Although a nine-month process may be reasonable for state or local permits, EPA has outlined the steps required for PSD permit issuance, and suggests that the preparation of a draft permit, alone, may take six months to one year from the time the permit application is determined complete. 230 Subsequent

225 Supply Chain and Outage Analysis of MISO Coal Retrofits for MATS , The Brattle Group, May 2012 (May 2012 Brattle Group document), Table 4, page 17, available at https://www.misoenergy.org/Library/Repository/Communica tion%20Material/Key%20Presentations%20and%20Whitepaper s/Supply%20Chain%20and%20Outage%20Analysis%20of%20MISO%20Coal%20Retrofits%20for%20MATS.pdf , also

available in the docket for this rule.

226 The May 2012 Brattle Group document, page 12 and page 17.

227 The May 2012 Brattle Group document, page 17.

228 See EPA’s Engineering and Economic Factors Affecting The Installation of Control Technologies for Multipollutant Strategies , 22 (2002), (EPA 2002 Multipollutant Strategies documen t), page 20, available in the docket for this rule.

229 See EPA 2002 Multipollutant Strategies document, page 22.

230 http://www.epa.gov/region9/air/permit/psd-issuing.htmlPage 145

EPA Responses to Comments: Navajo Gene rating Station Final Rule | July 28, 2014 to the issuance of a dr aft permit, a public comment period is required, which may include a public hearing, and EPA will issue a decision on the final permit after it has consider ed and responded to all comments. The permit usually becomes effective 30 da ys after EPA issues a final permit, unless the final permit is appealed to the Environmental App eals Board. In addition, PSD permits issued by EPA require consultation with other federal agencies (e .g., the U.S. Fish and Wildlife Service related to Section 7 of the Endangered Species Ac t) as well as tribal governments (particularly in cases where the facility is located in Indian country). As such, although a nine -month time frame for issuance of preconstruction permits may be appropriate for those issued by state or local permitting authorities; it is our experience that PSD permits issued by EPA often require more time. 231

The S&L cost study for SCR installation at NGS commissioned by SRP included schedules for the design, procurement, installation, and tie-in. Th e 2013 S&L cost study estimated approximately 41 months per unit, and 67 m onths for all three units. 232 EPA notes that the 67 month timeframe is beyond the 5 year period for BART and does not appear to include time required for pre-construction permitting. For our BART determination for Four Corn ers (for one of two options in our final BART determination for this facility), we required compliance with an emission limit achievable with SCR on 5 units within 5 years of the final rule. Speci fically, under BART, EPA required installation and operation of SCR controls on one 750 MW unit within four years of the e ffective date, and the remaining 750 MW unit and Units 1 – 3 within five years of the effective date. EPA had proposed phased-compliance at Four Corners over years 3, 4, a nd 5 following the effective date of the final rule. However, because the operator of Four Corners wa s seeking regulatory approval to purchase another owner’s share of Four Corners, a ccounting for the timeframe for final approvals of the transaction would have left the operator only 2 years to design, engineer, and construct c ontrols on the first unit (or set of units). Therefore, EPA finalized a phase-in schedule over years 4 and 5. Thus, although EPA did not require complete installation and ope ration of SCR on one unit until four y ears after the effective date of the final rule, the purpose of the f ourth year (instead of three y ears) was to accommodate time for completion of other regulatory approva ls related to ownership changes, to allow, overall, three years for complete SCR installation on the first unit following certainty in the plant ownership. 233 For San Juan Generating Station, EPA had proposed a complian ce timeframe of three years and finalized a compliance timeframe of five years ba sed on congestion at the facility th at would require additional time

for installation. 234 We note that submittals from SRP indicate d site congestion around Unit 2 at NGS that would affect the cost of compliance for that unit. 235 The commenter also states that “it appears contractors in the region will not be overwhelmed” to justify why installation time for SCR should not be longer than average. 236 We note that “installation time” is one part of compliance, and that EPA must also consider time for design, procurement, and pe rmitting. We also note that the commenter did not

231 Although EPA issued a PSD permit to NGS (for significant em ission increases of carbon mon oxide) over a relatively short timeframe, EPA also notes that for the BART Alternative optio n in the final FIP for the Four Corners Power Plant, which was finalized on August 24, 2012 (77 FR 51620) and requires installation of SCR on Units 4 and 5 by mid-2018, the operator of FCPP has been actively engaged with EPA in developing its PSD permit application, and as of April 2014, EPA has not yet put forth a draft PSD permit for public comment.

232 See Section 2.0 (Project Schedule) of S&L 2013 Cost Study for NGS in Appendix U-V at document 0354 in the docket

for this rule at EPA-R09-OAR-2013-0009.

233 See page 119 of the Four Corners Response to Comments. See document number 0234 in the docket for the Four Corners

BART Determination at EPA-R09-OAR-2010-0683.

234 See EPA Response to Comments for San Juan Generating Station, page 75, in the docket for this rule at EPA-R09-OAR2013-0009.

235 See discussion of higher retrofit cost of SCR on Unit 2 compared to Units 1 and 3 due to physical layout in the ANPR at 74 FR 44313 at 44321 (August 28, 2009) and references therein at footnote 12..

236 See page 17 of the EarthJ ustice comment le tter (0367).Page 146

EPA Responses to Comments: Navajo Gene rating Station Final Rule | July 28, 2014 provide any support for its statement that contract ors in the region will not be overwhelmed. If the

effective date for the final rule is in mid-2014, 3.5 years from the eff ective date of a final rule would mean compliance with the BART emission limit by the end of 2018. We note that the compliance date

for the installation of SCR on Units 4 and 5 at th e Four Corners Power Plant is mid-2018 and BART

determinations for several EGUs in Arizona also required NO x emission limits achievable with SCR with compliance dates at the end of 2017. 237 Therefore, EPA anticipates that leading up to 2018, numerous coal-fired EGUs in the region will be retrofit with post-combustion controls.

EPA continues to find that the five year pe riod for compliance with BART is reasonable. Because BART compliance at NGS i nvolves the design, procurement, a nd installation of SCR on three units as well as well as a complex federal permitting process that would require consultation with other federal agencies and tribal governme nts, as well as upcoming ownershi p changes at NGS as discussed in our proposed rule, EPA is determining that a five -year BART compliance tim eframe at NGS is as expeditious as practicable for purpos es of establishing the BART Benchmark. This is within the range cited by the commenters and the facility operator (i.e., average of 21 to 47 months per unit, or 35 months to 67 months for multiples units at one facility) a nd is consistent with the CAA that requires BART compliance as expeditiously as practi cable but no later than five years following the effective date of the

final rule. 238

Comment: Maintain 5 year compliance schedule to install SCR

A public interest advocacy group (0 413) said that EPA must re tain the five-year compliance

schedule for NGS. The commenter stated that other co al fired power plants are complying with BART within five years and installing SCR in that timeframe is essential to protect public health, in particular for the Navajo and Hopi people w hose communities are the closest to the NGS facility and most exposed to harmful toxics and particulates emitted. The commenter stressed the importance of a rapid timeline as each day makes a differe nce to peoples’ healt h, in particular childre n and the elderly. The commenter stated that “lengthening the timeframe s uggests that the Federal government can be exempt from its own Federal laws, esp ecially when the Federal govern ment is an owner of NGS.”

Response:

For calculating the appropriate BART Benchmark, EPA is retaining a NO x emission limit of 0.055 lb/MMBtu within five years of the effective date of the final ru le. However, EPA is finalizing our Supplemental Proposal that the TWG Alternative is a better than BART alte rnative that meets the framework we proposed in our February 5, 2013 Propos ed Rule. Our final determination for the BART limit (0.055 lb/MMBtu) and the BART compliance timeframe (5 years) are used to establish the total cap in NO x emissions at NGS over 2009-2044 under the fina l TWG Alternative. EPA notes that the visibility protection provisions , including the BART requirement , under section 169A of the CAA relates to visibility protection fo r Federal class I areas. Although NO x is a visibility-impairing pollutant that is also regulated as a criteria pollutant due to its effect on air quality and human health, the statutory authority for the Regional Haze Rule is based on visi bility protection. Thus, sp ecific issues of public health are beyond the scope of this rulemaking. EPA a ddresses the commenters a ssertion that using an alternative compliance timeframe for the better th an BART alternative suggests that the Federal

237 See Final BART FIP for Four Corners Power Plant an complia nce dates under the BART Alternative at 77 FR 51620 at 51648 (August 24, 20 12) and Final Regional Haze FIP for Arizona (phase 1) at 77 FR72512 at 72578 (Decembe r 5, 2012).

238 See section 169A of the CAA (§169A(b)(2)(A) and (g)(4)).Page 147

EPA Responses to Comments: Navajo Gene rating Station Final Rule | July 28, 2014 government can be exempt from its own laws, in Section 8.5 and 9.0 of this response to comments

document.

Comment: Allow 6 years to accommodate outage schedule

One individual (0091) recomme nded that EPA require NGS to install BART controls, including SCR in combination with LNB, within 6 years. The commenter believes that th e extra year would give NGS the flexibility to comply w ithout violating CAA or RHR requirements. In addition, the commenter stated that any lengthy delays in requiring NGS to install extra pollution controls would undermine EPA’s credibility, since neighbori ng states are undergoing simila r requirements. The commenter believes that a 6-year compliance date instead of the proposed 5-year timeframe would allow NGS the opportunity to keep its current 3-ye ar outage cycle with four layers of catalyst to meet a limit of 0.055 lb/MMBtu. The commenter (0091) also asserts that because EPA promulgated the Regional Haze Rule in 1999, NGS has had ample time to install BART contro ls. The commenter also as serts that other major stationary sources in neighboring stat es were required to comply with CAA visibility requirements years ago; therefore it would be unfair for EPA to approve a more lenient schedule for NGS.

One individual (0156) ca st doubt that NGS could maintain a 3-y ear outage cycle with four layers of catalyst while achievi ng a limit of 0.055 lb/MMBtu.

Response:

EPA disagrees that requiring NGS to comply w ith BART within six years is appropriate. We note that the compliance timeframe for BART (as expedi tiously as practicable but in no event later than five years after the effective date of the plan) is a statutory requir ement under the CAA. Therefore, EPA disagrees that a six-year compliance timeframe for BA RT is consistent with the CAA. We further note that EPA did not propose to extend the complia nce timeframe for BART. EPA proposed a BART

determination that consisted of a NO x limit of 0.055 lb/MMBtu with a five-year compliance time frame. Concurrently, EPA also proposed a framework for eval uating better than BART A lternatives, as well as two alternatives (Alternative 1 and the TWG Alternative) that both incl ude flexibility in the regulatory timeframe for BART Alternatives under the Regi onal Haze Rule. Our proposed framework established the proposed BART determination as a benchmar k against which BART A lternatives would be compared. Our rationale to provide flexibility in the compliance timeframe for BART Alternatives is discussed in our proposed rule and in sections 8.5 and 9.0 of this response to comments document.

EPA disagrees that NGS has had since 1999 to install BART controls. See EPA’s response to

comments in Section 8.5. In additio n, BART is a case-by-case analysis that could ultimately require installation of one of several different options fo r air pollution controls. Until a state (or EPA) has completed a BART determination, a facility does not know what emi ssion limit it must comply with, despite promulgation of the Regional Haze Rule in 1999. We also note that EPA began taking action on Regional Haze SIPs, and in some cases, proposin g and taking final action on FIPs, over 2011 – 2013. Therefore, EPA disagrees with the as sertion that major stationary sources were required to comply with the CAA visibility requirements “years ago”. EPA also disagrees with the commenter that it is unfair for NGS, a facility located in Indian country, to be subj ect to a longer compliance timeframe than facilities

located on state land. See Sections 8.5 and 9.0 in this response to comments.

Although one commenter (0091) supported the id ea that NGS could maintain a 3-year outage cycle with four layers of catal yst to meet a limit of 0.055 lb/MMB tu, another commenter (0156) castPage 148

EPA Responses to Comments: Navajo Gene rating Station Final Rule | July 28, 2014 doubt based on concerns related to the quality of work from S&L. Because neither commenter provided any detail to sufficiently support its a ssertions as it pertai ns to catalyst manageme nt plans, EPA is not responding to these particular st atements from the commenter. 239 However, we note that the 2013 cost analysis from S&L includes upda ted costs to accommodate a NO x design target of 0.03 lb/MMBtu using a 3+1 catalyst system in lieu of a 2+2 system. Although S&L asserts that a design target of 0.03 lb/MMBtu would be required to meet a limit of 0.07-0.08 lb/MMBtu in orde r to accommodate loadcycling operation at NGS, S&L do not specifically disc uss catalyst management as a potential issue (see section 8.1).

Comment: Proposed BART limit 30-BOD plantwide limit issues

One of the owners of NGS (0348) expresse d concern that the me thodology for assessing compliance with the February 2013 proposal’s 30 day rolling average emission limit is impractical and produces an average that is meaningless. The commenter noted that the October 2013 Supplemental Proposal’s emission rate lim its are expressed on a unit by unit basis, which helps to address some of

these concerns.

The commenter (0348) noted that the proposed BART determination would require NGS to comply with a plantwide emission limit of 0.055 lb/MMBtu as BART, based on a 30 BOD average basis, and to construct the plan twide average, an individual 30 day average must be calculated for each unit. According to the commenter, because each unit may have operated on different days, a different

30 day period might form the average for each unit, whic h would then be averaged together to form the plantwide average. The commenter believes that aver aging emissions that occu r on different days, at different times, and from different units cannot provide the public with a real picture of the plant’s emissions, and is therefore meaningless and irrelevant.

The commenter (0348) asserted that a pl ant operator cannot pr actically manage NO x emissions to remain below a permit limit that is structured in th e manner that would be required by the proposed rule. The commenter stated that the proposed plantwid e averaging methodology unn ecessarily penalizes NGS

in the event that a unit is offline because it fail s to recognize that there ar e no emissions from the unit during that time. The commenter also is concerned that the pr oposed averaging methodology creates compliance challenges, particularly during times surrounding planned maintenance activities, because

NO x emissions from coal fired boilers are often at their highes t just prior to scheduled maintenance outages. Thus, because the proposed BART NO x limit requires NGS to account for the last valid 30 BOD average when a unit is shut down, the commenter believes that NGS will be penalized for an extended period of time for performing the necessary maintenance to improve NO x performance.

The commenter (0348) added that scheduled main tenance outages at NGS are required to occur between October and April, which represents a pe riod of time in which the output from NGS may be

reduced due to load demand. The commenter asserted th at this further exacerba tes the issues with the averaging provision proposed by EPA, as it is likely that the units will incur more load cycling during

this time frame with increased NO x emissions as a result (as de monstrated in the S&L modeling discussed above).

239 One commenter (0156) includ ed numerous attachments to its comments as related to S&L’s work on the SanTan Generating Station, however, these supporting documents are not directly related to catalyst management plans for NGS.Page 149

EPA Responses to Comments: Navajo Gene rating Station Final Rule | July 28, 2014 The commenter (0348) also indi cated that the proposed averagi ng provision does not provide an opportunity for NGS to correct any potential exceedances. The commenter noted that an exceedance caused by one unit at NGS would result in all thr ee units being out of compliance. The commenter added that typically, removing the offending unit from service (and accounting for the zero emissions from that unit) while addressing i ssues would ensure that the rema ining units operating within the parameters of the permit limit would be able to continue to operate . However, the commenter believes that because the CAA prohibits an operator from knowingly violating a permit limit, NGS would be forced to remove the remaining units from service.

Further, the commenter (0348) beli eves that NGS would not be able to return any of the units to service as a result of counting the last 30 BOD average from each of the units – the emission rate last recorded during unit shutdowns would be in effect in perpetuity. Acco rding to the commenter, restarting the units – and the subsequent emissions penalties fo r the starts – would potentially constitute a knowing violation of a permit limit.

The commenter (0348) agreed that, if construc ted correctly, averaging provisions can provide greater flexibility to the facility operators while achieving desired environmental objectives. However, the commenter believes that EPA’s proposed pl antwide averaging methodology creates significant compliance and enforcement concerns. The commenter added that the EPA has previously acknowledged that the use of an offline unit’s preceding 30 BODs’ information in determining compliance with a plantwide em ission limit is a novel concept. 240 The commenter asserted that it has not been used in the regional haze context anywhere in th e country and that for this reason and the reasons noted above, it should not be included in the final rule.

Response:

In our Proposed Rule, we determined that a NO x limit was achievable based on a facility-wide, rolling average basis of 30 boiler operating days in or der to provide additional flexibility to the operator of NGS in meeting the proposed limit. In our Suppl emental Proposal, EPA proposed emission limits and averaging times on a unit-spec ific basis. The BART Guidelines states that BART limits must “specify an averaging time of a 30-day rolling average, and contain a definition of ‘boiler operating day’ that is consistent with . . . 40 CFR Part 60, subpart Da.” The BART Guidelines provi de that states “should consider allowing sources to average emissions acro ss any set of BART-eligible emission units within a fenceline,” but does not require that BART limits be established on a facility-wide basis. EPA acknowledges the comment from the facility opera tor that it believes the facility-wide averaging methodology is problematic.

EPA is establishing a BART Benchmark for NGS based on a lifetime cap in NOx emissions under the TWG Alternative. Because EPA is taking fi nal action to approve the TWG Alternative, which proposed to establish emission limits on a uni t-specific basis, this comment is moot.

Comment: BART in the context of Regional Haze planning

Two of the owners of NGS (0314, 0348) stated that EPA’s current process appears to be disconnected from all the previous and on going regional haze planning in the Grand Canyon National

240 The commenter cites to “EPA, Questions for AZ Regional Haze FIP Conference Call , January 2013” but did not provide a document to accompany this citation. EP A assumes this was personal communication between EPA staff and SRP staff.Page 150

EPA Responses to Comments: Navajo Gene rating Station Final Rule | July 28, 2014 Park region. A state agency (0017/0289/0320) noted th at EPA stated in the Fe bruary 2013 Proposal that NGS is just one of many contribut ors to regional haze and indicated that Congress recognized that “all sources that emit air pollutants that may reasonably be anticipated to cau se or contribute to visibility impairment would need to do their part to address the problem” (citing 78 FR 8279).

One of the owners of NGS (0348) elaborated that EPA should evaluate the anticipated visibility benefits expected from its proposed BART Determin ation for NGS in combination with the visibility improvements expected from the other emission reduc tion requirements in th e Arizona regional haze plan and other surrounding states that impact the same Class I areas. The commenter believes that failing to do so is at odds with EPA’s own recogniti on of the value of regional planning efforts, and the commenter expressed concern that much of the work of the Grand Canyon Visibility Transport Commission (GCVTC) and its suc cessor body, the Western Regional Air Partnership (WRAP), was ignored in EPA’s August 2009 Advanced Notice of Pr oposed Rulemaking as well as in the February 2013 Proposal. The commenter believes that the EPA’s proposed determination that SCR is BART is completely at odds with the goals that EPA itsel f established for the GCVTC and WRAP efforts.

The commenter (0348) indicated that real da ta measured over time on the Colorado Plateau

demonstrate that NO x emissions play a small role in visibility impairment in this region, and power plant emissions only account for a fraction of that small contribution. The comment er stated that visibility in the Colorado Plateau region, as measured by th e Interagency Monitoring of Protected Visual Environments (IMPROVE) monitoring network, is ge nerally excellent, and the visibility impairment that does occur is largely attr ibutable to natural sources, in cluding Rayleigh scattering, wind blown dust, and smoke from wildfires, while cont rolled burns also contribute significantly to visibility impairment.

The commenter noted that the 1996 technical analyses performed by the GCVTC showed that nitrate aerosols account for only 4 percent of light extinction in the Grand Canyon. (Note that this analysis ascribed 40 percent of visi bility impairment to Rayleigh scatteri ng and divided the remaining 60 percent among various types of particles.) The commenter al so cited subsequent analyses conducted by WRAP

which concluded that stati onary source emissions of NO x probably cause only about 2 to 5 percent of the impairment on the Colorado Plateau. The commenter stated that a more recent review of IMPROVE monitoring data at Grand Canyon sites indicates that nitrate aerosols fr om all sources continue to be a relatively small contributor to light extinction within the park and presented data from the 20 percent worst visibility days at three si tes in the Grand Canyon showing that nitrate aerosols contributed from 6.1 to 7.3 percent. The commenter added that the NR EL report indicated that the body of research is inconclusive as to whether removing appr oximately two-thirds of the current NO x emissions from NGS would lead to any perceptible improvement in visibi lity at the Grand Canyon and other areas of concern.

The commenter (0348) stated that EPA directed states in the RHR to consider all sources of man made haze in developing long term strategies. While conceding that there is a significant focus on BART for major stationary s ources in the first planning period, the commenter stated that it is clear that there are numerous other contributors to regi onal haze and concluded that EPA’s proposed NO x BART

determination for NGS fails to take into account this bigger picture. The commenter asserted that the proposed BART determination would not achieve any appreciable visibility benefits because NO x from power plants – and NGS in particular – is a very small contributor to regional haze. The commenter indicated that this is why the commenter’s BART analysis concluded that costly post combustion

controls for NO x are not justified.

Response:Page 151

EPA Responses to Comments: Navajo Gene rating Station Final Rule | July 28, 2014 Although EPA agrees that there ar e numerous contributors to re gional haze and that the RHR addresses visibility impairment based on multiple s ources located across a wide geographic area, those considerations are beyond the scope of this rulemaking. This rulemaking is limited to implementing the BART requirements in Section 169A of the CAA and the RHR. As discussed elsewhere, the CAA requires BART for certain large stationary sour ces that were put in place between 1962 and 1977. 241 For any source that is subject to BART, the BART dete rmination is based on five statutory and regulatory factors irrespective of th e relative measured nitrate contribu tion. Here, NGS is BART-eligible and subject-to-BART because our modeling, conducted accord ing to the procedures set out in the BART Guidelines, shows that NGS causes visibility impairment at multiple Class I areas. EPA has authority under the TAR to determine what provisions of th e CAA and RHR are necessa ry or appropriate to promulgate at this time. The issues cited in the co mment are related to whether EPA should require more controls for a greater number of sources based on reasonable progress – but this rulemaking is limited to implementing BART at NGS. If EPA determines at some point that additional vi sibility planning efforts are necessary or appropriate, we ma y consider involving surrounding states that impact the same Class I areas as suggested by the commenter.

Regarding the assertion that emissions from pow er plants represent a small contribution to visibility impairment on the Colorado Plateau, EPA not es that estimates of visibility impairment vary by the estimation method used. Reliance on an average ove r groups of days and on the percentage of the overall inventory may not be the be st method for attributing impairment to particular sources. Under the BART Guidelines, impairment due to individual sources are estimated using CALPUFF modeling. Estimates of impairment from stationary sources of NO x also vary by location, calendar year, and time of year. For many Class I areas in the western U.S ., the worst visibility occurs during summer, when carbon from fires is a dominant impairment component; this makes stationary source NO x appear small

in a relative sense. Nevert heless, stationary source NO x remains an important component of visibility impairment, one that cannot be neglected. Any one se gment of the overall emission inventory might be

dismissed as too small to necessita te controls, in which case no progre ss could be made toward the RHR national goal of remedying visibili ty impairment from manmade po llution. Instead, the RHR identifies stationary sources as an important category for evaluation, in the fo rm of a BART analysis. Modeling has shown that many individual stationary sources have the potential to c ontribute to visibility impairment (i.e., have a modeled impact of at least 0.5 dv). 242 In particular, EPA modeling of NGS, as discussed in the TSD for our proposed rulemaking, showed 98 th percentile visibility impacts from NGS of 1.3 to 8.4 deciviews, depending on the Class I area (or from 0.8 to 4.3 deciviews if lower ammonia background is assumed, as recommended by some commenters). 243 These are not negligible impacts.

EPA also disagrees with the commenter that we should consider the cumulative benefits in visibility improvements from all neighboring states’ regional haze SIPs and other BART determinations in determining BART for NGS. The BART analysis is conducted on a source-speci fic basis. Nothing in the BART regulations or guidance requires that EPA consider visibility improvements from other sources in determining BART for a particular source under the RHR.

Comment: Section 169A is discretionary therefore EPA must balance cost and adverse impacts

A CAP agricultural water users group (0305) poin ted out that the goal of CAA section 169A is an aesthetic goal, and is not a non-discretionary duty of EPA as the NAAQS and MACT standards are

241 See preamble to the BART Guidelines at 70 FR 39104, at 39105 (July 6, 2005).

242 Id ., at 39161.

243 See Tables 43 and 44 in the TSD for the Proposed Rule.Page 152

EPA Responses to Comments: Navajo Gene rating Station Final Rule | July 28, 2014 (citing CAA section 169A(f)). Instead, according to the commenter, EPA must balance the cost and other adverse impacts of BART against the visibility improvements that the BART controls will achieve in a five-factor analysis, rather than singularly focusing on maximu m emission reductions. For reasons detailed elsewhere in this document, the commenter asserts that EPA has impr operly used its discretion under the RHR because the proposed BART determina tion would impose substantial costs and other adverse impacts, yet would yield wh at the commenter characterized as de minimis visibility improvements. The commenter asserted that a proper co st-effectiveness analysis in the context of a fivefactor analysis would clearly indi cate that the high costs of SCR do not justify any minimal visibility improvement that would be achieved, and concluded th at because EPA’s analysis does not lead to this unavoidable conclusion, its determinati on that SCR is BART is flawed.

This commenter (0305) contends that SCR would provide only a marginal visibility benefit over SNCR, but at a much greater cost. The commenter quoted the February Propos al as indicating that across all 11 impacted Class I areas, SCR would achie ve a cumulative visibility improvement of 13 dv beyond the improvement through SNCR, with only two Class I areas seeing improvements greater than 2 dv. According to the commenter, such visibility improvements may not be perceptible to the human eye (citing the NREL report) and, ther efore, selecting SCR as BART under these circ umstances would be arbitrary and constitute an abuse of discretion on the part of EPA.

Response:

The comment states that the goal of CAA section 169A is aestheti c. EPA does not agree with the commenter’s characterization of the goal of section 169A. The goal of this stat utory provision is stated in section 169A(a)(1) of the CAA: “Congress hereby declares as a na tional goal the prevention of any future, and the remedying of any existing, impairment of visibility in mandato ry class I Federal areas which impairment results from manmade air pollution.” Aesthetics may constitute one benefit of the Congressional goal set forth in sec tion 169A(1)(a) but it is not the goal of the statutory provision and is only one of many benefits, including the jobs and economic improvement from tourism in the region surrounding Class I areas.

The comment also states that the goal of secti on 169A is not a non-discre tionary duty for EPA in contrast to the NAAQS and MACT standards, citing section 169A (f). EPA agrees that the goal expressed in section 169A(1)(a) can not be enforced pursuant to a C AA section 304 citizen suit. Section 169A(f) provides in full: “For purposes of section 7604( a)(2) of this title, the meeting of the national goal specified in subsection (a)(1) of this secti on by any specific date or date s shall not be considered a ‘nondiscretionary duty’ of the Ad ministrator.” However, Section 169A(f) by its terms is limited to enforcing any dates that may be associated with the Congressional goal to prevent any future, and remedy any existing, impairment of visibility in ma ndatory class I Federal areas if the impairment results from manmade air pollution. 244

The comment then states that EPA must balance the costs and visibility improvement of BART. This portion of the comment does not seem relevant to a discussion about the goal, and citizen suit enforceability of the goal, set fort h in section 169A. Balancing cost s and visibility improvement is relevant, inter alia, to a determination of BART. In this FIP, EPA is establishing a BART Benchmark and promulgating better than BART regulations that apply to NGS. The requirement for States to promulgate implementation plans requiring BART for s ources that are subject to BART is set forth in

244 See CAA section 169A(1)(a).Page 153

EPA Responses to Comments: Navajo Gene rating Station Final Rule | July 28, 2014 CAA Section 169A(b)(2). The prohibition on citizen su it enforceability in section 169A(f) is not, therefore, applicable to the act ion EPA is taking in this FIP.

Although section 169A(f) does not apply to a BART determination promulgated pursuant to CAA section 169A(b)(2), EPA agrees that our action in promulgating this FIP is discretionary. Our action here is discretionary (or “not nondiscretionary”) based not on section 169A(f) but instead based on CAA Section 301(d)(4) and 40 CFR 49.11 of EPA’s Tribal Authority Rule. 245

The comment does not explain why characterizing EPA’s duty as discretionary or “not nondiscretionary” in this ac tion is significant. The comment im plies that EPA might weigh the five BART factors differently depending on whether its duty is discretionary or mandatory. EPA disagrees with the implication that we would exercise discreti on to weigh the five factors set forth in CAA Section 169A(2)(C)(3) differently based on whether we were exercising a ma ndatory or discretionary duty.

The commenter claims that EPA must balance the costs and ot her adverse impacts of BART against the visibility improvements that the BART cont rols will achieve in a five-factor analysis, rather than singularly focusing on maximum emission reducti ons. EPA agrees and has weighed the five BART factors in this rulemaking. To the extent the commen t contends that EPA has not reasonably weighed the BART factors, the commenter has mischaracterized EPA’s action in this FIP. In determining the NO x emission limit that represents BART, EPA went to considerable lengths to analyze and discuss our balancing of the five BART factors, including cost and visibility improvement. EPA’s analysis of the five BART factors began with our A dvanced Notice of Proposed Rulemaking. 246 EPA received numerous comments in response to our discussion of the BART fact ors in the ANPR. EPA considered those comments and provided extensive analysis of the five BART factors when we published our Notice of Proposed Rulemaking in February 2013. 247 EPA’s TSD accompanying the February 2013 Proposed Rule contains additiona l detail concerning our analysis of the five BART factors.

EPA did not “singularly” consider maximum emi ssion reductions. To the contrary, EPA weighed the five BART factors to propose finding that an emission limit of 0.055 lb/MMBtu for NO x was BART, which is achievable by installing SCRs on all 3 units at NGS. 248 After establishing the proposed NO x BART determination of 0.055 lb /MMBtu, EPA calcula ted the BART Benchmark, or total NO x emissions attributable to NGS ove r long-term operations from 2009 - 2044. 249 EPA then proposed to find that any alternatives to BART that resulted in lower NO x emissions than the BART Benchmark would be better than BART, provided that number was calculated using the same NO x BART emission rate (0.055 lb/MMBtu) over the same amount of time (2009-2044). 250 Therefore, EPA only considered

total or cumulative NO x emissions reductions in esta blishing a framework to eval uate alternatives to the BART Benchmark that might be cons idered better than BART. EPA’s BART proposal was based solely on weighing the BART factors and not based on a consideration of maxi mum emission reductions.

245 See Dine CARE v. United States En vironmental Protection Agency, No. C 12-03987, Order Granting Defendant and Intervenor’s Motions for Summary Judgment and Dismissing Ac tion for Lack of Subject Matter Jurisdiction (N.D. CA, Dec. 03, 2013) (stating: “[T]he provision cited by Plaintiffs requir ing the State to submit a determination for each eligible BART source does not apply to the Tribe or EPA.” Slip op. at p. 4).

246 See ANPR at 74 FR 44313, 44320 – 44333 (August 28, 2009).

247 78 FR 8274, 8279 – 8287 (February 5, 2013).

248 See 78 FR at 8288 (February 5, 2013)

249 Id . at 8289.

250 Id. at 8290.Page 154

EPA Responses to Comments: Navajo Gene rating Station Final Rule | July 28, 2014 The comment contends that the costs of SCR as BART were mu ch higher than EPA projected and that the visibility improvement s from SCR would be “minimal.” As discussed elsewhere in this document, EPA disagrees with both statements. First, the cost of SCR is reasonable and cost-effective, even when we consider the highest cost estimate s based on SRP’s 2013 cost analysis (see response to comments in section 3.1 of this response to co mments document). Second, the commenter relies on a report prepared by NREL as the basis for stating the visibility improvement s will be minimal. The NREL report was not designed to evaluate the magnit ude of the visibility im provement from SCR at NGS and the statement in the NREL report was concluso ry without supporting data. NPS has stated that the visibility section of the NREL report was inade quate and that it made a number of inappropriate comparisons between models and model results. 251 EPA disagrees with the a ssertion that visibility

benefits would be minimal and the data in our reco rd for this final rule continue to demonstrate substantial visibility improvement from NGS achieving a NO x BART emission rate of 0.055 lb/MMBtu on a rolling average of 30 boiler operating days.

The comment also conte nds that setting a NO x BART emission rate achievable with SCR would only be a nominal improvement over the emission rate achievable with SNCR. Again, citing to the NREL report, the commenter states the visibility improvement from SCR over SNCR would not be perceptible. We have responded to this comment elsewhere in this document.

Comment: Support for EPA’s proposed BART determination

One commenter (0395) supported the finding that S CR is appropriate, citing specifically to the

incremental cost effectiveness for SCR is less than SNCR ($3,315 versus $4,110 per ton of NO

x removed). The commenter opines that the relative av erage and incremental cost effectiveness of SCR compared to SNCR, in conjunction with the documente d key findings in Table 9 of the preamble to the proposed rule (showing the improved baseline impairment from NO x emissions by an average of 73 percent with SCR across 11 Class I areas, as compar ed to 45 percent associated with SNCR), clearly demonstrates the superior visibility benefits can be achieved more cost-e ffectively by setting a NO x limit

based on SCR. The commenter added that with LNB/SOFA, NGS has hundreds of modeled impacts

above a concern threshold of 0.5 dv across 11 federa l Class I areas. In the commenter’s opinion, it is EPA’s statutory responsibility to set a BART-lev el of control based on the use of SCR for NO x reduction, which EPA determined would be double the vi sibility improvement projected at 11 parks and wilderness areas in the region.

Response:

EPA agrees with the commenter that our BART determination for NGS, based on our five-factor analysis, was appropriate and reasonable.



### 8.2 Comments on BART for PM

Comment: Support/opposition for finding not to establish PM BART

251 See letter from Herbert Frost, NPS to Jared Blumenfeld, EPA, dated April 6. 2012 (titled “2012_0406 NPS letter to EPA”), document number 0004 in the docket for this rule at EPA-R09-OAR-2013-0009.Page 155

EPA Responses to Comments: Navajo Gene rating Station Final Rule | July 28, 2014 One of the owners of NGS (0348) and a CAP agricultural water users group (0305) voiced support for EPA’s statement that “Because emissions of PM are well controlled at NGS through federally enforceable limits, EPA is not proposing that it is “necessary or a ppropriate” under the TAR to

determine BART for PM emissions at NGS.” The co mmenters agree that no a dditional emission limits or controls should be required as a result of BART for PM emissions.

The commenters (0305, 0348) also stated that im plementation of the Mercury and Air Toxics Standards (MATS) in the near future will establish an additional federally enforceable limit for PM

emissions at NGS. The commenters added that the BART Guidelines provide that one can generally rely on MACT standards for purposes of BART (citin g 70 FR 39163-34; 40 CFR part 51, Appendix Y, section IV.C). One of the commenters (0305) indi cated that MATS will reduce the NGS PM limit from 0.06 lb/MMBtu to 0.03 lb/MMBtu, achieving substantia l reductions beyond present levels. Based on these arguments, one of the commenters (0348) reque sted that EPA include the following statement in

the final rule:

Because PM emissions at NGS are already well controlled pursuant to federally enforceable emission limits and because implementation of MATS at NGS would, pursuant to th e BART Guidelines, satisfy any PM BART requirement that might otherwis e be deemed to apply, we need not determine that it is necessary or appropriate under the TAR to establish

PM BART limits for NGS.

One of the commenters (0305) added that the EPA appropriately exercised its discretion under the RHR, acting on behalf of the Navajo Na tion, to consider NGS’s progress on PM (and SO 2 ) to ensure that reasonable progress is made toward visibility improvement in the affected Class I areas. The commenter believes that the cost of compliance at NGS, the existing pollution controls at NGS, and the relatively small degree of additional visibility improvement that would be possible from further PM (or

SO 2 ) BART controls on alrea dy well-controlled units all justify th e EPA’s decision not to impose a PM (or SO 2 ) BART determination.

In contrast, two groups (0373, 0401) asserted that EPA was incorrect in its determination that it

need not evaluate BART for control of PM at NGS b ecause particulates are well-controlled with a plantwide limit of 0.060 lb/MMBtu (citing 78 FR 8279). A ccording to this commenter, this limit was not based on a BART analysis and does not reflect a well-controlled PM emi ssion rate for a coal-fired EGU, but is simply a carry-over from what EPA and/or the state has historically applied to NGS under the Arizona SIP (citing the Stamper repor t). The commenter stated that this “historical carry-over approach” is not BART and does not meet the requirements of the CAA.

This commenter (0373) does not believe that the electrostatic precip itators (ESPs) at NGS represent the best system of c ontrol for PM. The commenter believes that EPA’s determination is

inconsistent with its recent determination that the ex isting PM controls at FCPP (which, according to the commenter, currently emits PM at or below 0.03 lb /MMBtu) do not constitute BART (citing the Stamper report and 77 FR 51637), and with recent BACT determinations for coal -fired utility boilers

with PM limits of 0.010 lb/MMBtu based on the use of fabric filter baghouses. The commenter added that NGS is allowed to exceed the PM limits during startup and shutdown, while BART requires the best system of continuous controls. The commenter asserted that EP A’s “inconsistent” approach to NGS is unsupported (citing the Stamper report).Page 156

EPA Responses to Comments: Navajo Gene rating Station Final Rule | July 28, 2014 The commenter (0373) believes that fabric filter baghouses should have b een evaluated as BART

at NGS and such evaluation would demonstrate that they are necessary to meet the visibility requirements of the CAA. The commenter stated that this technology has been in use since the 1970s and is cost effective at $43/ton of PM removed (citing the Stamper report). The commenter added that it is likely that baghouses will be re quired at NGS to meet MATS and that they would save NGS money on electricity (citing the Stamper re port). In addition, the commenter indi cated that it is likely that the affected Class I areas would show significant visibi lity improvements if NGS installed baghouses, and cutting PM emissions would have he alth benefits. The commenter conc luded that EPA should revise its determination and complete a BART analysis for PM which includes evaluation of fabric filter baghouses.

Response:

EPA agrees with the comment that it is not nece ssary or appropriate to require BART for PM or

SO 2 emissions from NGS at this time. As we stat ed in our proposed rule: “Emissions of PM and SO 2 are controlled by hot-side electrostatic precipitators (HS-ESPs) and wet scrubbers, respectively.” 252

With respect to SO 2 emissions, EPA made a finding in a 1991 FIP that the wet scrubbers to

reduce SO 2 emissions that would be (and have now been) installed between 1997 – 1999 were better

than BART with an emission limit of 0.10 lb/MMBtu averaged on an annual basis. 253 EPA has not been presented with any information in this rulemaking to indicate that our better than BART determination in 1991 was insufficient for purposes of regulating regiona l haze. Therefore, we continue to find that the

SO 2 emissions limit finalized in our 1991 SO 2 FIP, and codified in 40 CFR 49.5513(d)(1) continues to achieve greater reasonable progress than SO 2 BART.

For PM, EPA’s proposal stated that making a BART determination is not necessary or appropriate at this time because the PM emissions are well controlled by HS-ESPs based on federally

enforceable emissions limits. 254 The PM emission limit of 0.060 lb/MMBtu is codified at 40 CFR 49.5513(d)(2). In addition, at the ti me of our BART proposal, the MATS Rule for electric utility steam generating units had been finalized. 255 The MATS rule sets a limit of 0.03 lb/MMBtu for filterable PM that is applicable to the units at NGS. Because NGS will be required to comply with the PM emissions limits in the MATS rule, EPA continues to find that it is not necessary or appr opriate at this time to promulgate a BART emission limit for PM from NGS. EPA’s MATS rule retained a 20 percent opacity standard as being sufficient to ensure compliance w ith the PM emission limit that will be required for electric generating units subject to that rule. 256

One commenter requested that EPA add the followi ng language to the final rule: “Because PM emissions at NGS are already well controlled pursuant to federall y enforceable emission limits and because implementation of MATS at NGS would, pursuant to the BA RT Guidelines, satisfy any PM BART requirement that might otherwise be deemed to apply, we need not determine that it is necessary or appropriate under the TAR to es tablish PM BART limits for NGS.” While EPA agrees with the statement, we do not consider it appropriate to incl ude any regulatory text to this effect. EPA expects that NGS will continue to comply with the SO 2 and PM emissions limit codified at 40 CFR 49.5513(d)

until the MATS emission limit of 0.03 lb/ MMBtu becomes applicable to NGS.

252 78 FR at 8279 (February 5, 2013).

253 56 FR at 50179 (Oct. 3, 1991, codified originally in 40 CFR 52.145 and re-codified at 40 CFR 49.5513).

254 78 FR at 8279 (February 5, 2013).

255 77 FR 9304 (February 16, 2012)

256 White Stallion Energy Center LLC v. EPA, , in the docket for this rule at EPA-R09-OAR-2013-0009.Page 157

EPA Responses to Comments: Navajo Gene rating Station Final Rule | July 28, 2014 EPA disagrees with the comments stating that a BART determination for PM is required. One commenter stated that EPA’s “historical carry-over approach” for the PM emi ssion limit is not BART and does not meet the requirements of the CAA. EPA is not determining that the existing PM emission limit for NGS is BART. Instead, it is EPA’s position that it is not neces sary or appropriate under our discretionary authority promulgated at 40 CFR 49.11 to conduct a BART determination for PM emissions because they are currently well controlled and will be further reduced by compliance with the

MATS rule.

One commenter asserted that EPA should require fabric filter baghouses as BART for PM, that baghouses have been in use since the 1970s and that they are cost effective at $43/ton of PM removed (citing the Stamper report). The commenter further added that baghouses may be required at NGS to meet MATS, they would save NGS money on electrici ty, that Class I areas would show significant visibility improvements if NGS installed baghouses, and that cutting PM emi ssions would have health

benefits.

EPA cannot agree or disagree that baghouses woul d be required as BART for PM because we have determined that it is not necessary or approp riate at this time to conduct a BART determination for PM at NGS. EPA does not consider it necessary or appropriate to conduct a BART determination for PM because the PM emissions are currently well cont rolled and will be subject to a lower emission limit pursuant to the MATS rule sooner than BART would have been required. Therefore, EPA has decided to use its resources at this time to require only NO x BART for NGS.



### 8.3 Comments on BART for SO 2

Comment: Support for finding that RP is met for SO 2

One of the owners of NGS (0348) and a CAP ag ricultural water users group (0305) noted that EPA recognized in the February 2013 Proposal th at the emission limits EPA established for SO 2 in 1991 were determined to achieve greater reasonable pr ogress than would BART, th erefore the reasonable progress goals of CAA section 169A(b)(2) for SO 2 at NGS are already satisfied with the installation of wet scrubbers (citing 78 FR 8279). The commenters agr eed that no additional emi ssion limits or controls should be required as a result of BART for SO 2 emissions. One of the commen ters (0305) noted that the existing SO 2 limit at NGS is more stringent than the BART Guidelines’ presumptive SO 2 limit.

One of the commenters (0305) added that EPA appropriately exercised its discretion under the RHR, acting on behalf of the Navajo Nation, to consider NGS’s progress on SO 2 (and PM) to ensure that reasonable progress is made toward visibility improvement in the affected Class I areas. The commenter believes that the cost of compliance at NGS, the existing pollution controls at NGS, and the relatively small degree of additional visibility improve ment that would be possible from further SO 2 (or PM) BART controls on already well-controlled units a ll justify EPA’s decision not to impose an SO 2 (or PM)

BART determination.

Response:

EPA agrees with the comments. As EPA stat ed in our proposal in February 2013, the SO 2 emissions limit established in EPA’s 1991 SO 2 FIP was better than BART. Specifically, EPA determined that promulgating a SO 2 emission limit of 0.10 lb/MMBtu on an annual average basis wouldPage 158

EPA Responses to Comments: Navajo Gene rating Station Final Rule | July 28, 2014 result in greater cumulative SO 2 emissions over time. Our 1991 SO 2 FIP concluded: “After reviewing the option recommended by SRP, EDF, and GCT, EPA ha s determined that such a control strategy will provide a substantially greater de gree of emissions reduction, and a correspondingly greater degree of visibility improvement at a substantially lower cost than the alternative propos ed in February 1991. For these reasons, EPA also concludes that this opt ion will make additional reasonable progress towards attainment of the national visibility goal in comparison to the February 1991 proposal.” 257

NGS installed a wet flue gas desulfurization system on each of its boilers in 1997-1999. EPA initially codified the requirements for NGS to meet an SO 2 emissions limit in an existing FIP for the

State of Arizona. 258 After promulgation of the TAR, EPA moved the NGS SO 2 FIP to 40 CFR 49.5513.

EPA also agrees with the comment implying that it is not necessary or appropriate to conduct a

BART determination for SO 2 or PM at this time, based at least in part on the costs of additional SO 2 or PM controls.



### 8.4 Other Comments on BART

Comment: SCR is not the best solution for health and the environment

One environmental advocacy group (0055) objecte d to the BART proposal noting concern about SCR’s use and generation of hazardous waste. The co mmenter asserts that it is better to set emission limits, monitoring and reporting requir ements and deadlines, as opposed to allowing NGS to define their

own method to meet the emission limits and their own business requirements. The commenter indicated

substantial concern over th e operation of NGS in general and the am ount of pollution thatit creates, its contribution to GHG emissions, and its massive water consumption. Th e commenter recommended that instead of requiring expensive, and in the commenter’s opinion, questio nable controls, costs should be added to the operation of the plant to develop a fund that compensates communities for the health and environmental costs of operating the plant. Also, the commenter urged that for the time being, a deadline should be set to transition NGS away from using coal to generate power.

Response:

EPA notes that our BART determination is an emission limit and not a requirement to install a specific control technology. The emission limit we proposed as BART is achievable with SCR+LNB/SOFA, but the operator of NGS may insta ll any technology that meets the required emission limit. The commenter may be confusing our BART determination with the TWG Alternative, which, under TWG Alternative B, allows NGS to de termine how to meet the 2009-2029 and 2009-2044 NO x Caps. EPA does not consider SCR to be a questiona ble control. We note that SCR is a widely-used technology on coal-fired and natural- gas fired power plants throughout the country and internationally. EPA also notes that general concer ns about the environmental impact of NGS can be raised during the joint EIS process for NGS and the Kayenta Mine. Fi nally, as stated previ ously, EPA does not have authority under the RHR to require NGS to transition NGS away from using coal (or otherwise redefine the facility).

257 See 56 FR at 50179 (October 3, 1991).

258 See 40 CFR 52.145.Page 159

EPA Responses to Comments: Navajo Gene rating Station Final Rule | July 28, 2014 Comment: Downwind monitoring

Two industry/commerce commenters (0027, 0076) st ated that visible emissions, measured in terms of opacity, is the only cost effective and ac curate way to control source emissions and should be required on the operations to ensure that required c ontrols are controlling the emissions of the source.

The commenters indicated th at control technology performance char acteristics are less than perfect and suggested that a secondary quality assurance type of measurement be required to achieve desired goals. These commenters also suggested that downwind mon itoring using actual visibi lity indicators, such as digital imagery, be required to measure the effects of this implementation plan on the visibility levels at the North and South Rim centers at the Grand Canyon.

Response:

EPA notes that visible emissions , measured in terms of opacity, are an important indicator for compliance with emissions limits for particulate matter. We note that previous FIP requirements promulgated for NGS already included an opacity re quirement, limiting opacity from Units 1, 2, and 3 at NGS to no greater than 20 percen t opacity, excluding condensed uncom bined water droplets, averaged over any six minute period and 40 percent opacity, av eraged over six minutes, during absorber upset

transitions. 259 Regarding the commenter’s suggestion to use vi sibility indicators, su ch as digital imagery, at the North and South Rims of the Grand Canyon, to measure the effects of th e FIP on visibility, we note that while the CALPUFF visibility modeling can esti mate the impact of a facility on visibility in a Class I area, the modeling cannot pred ict how all the other so urces of air pollution, whether from natural or anthropogenic sources, will affect visibility, in combination with NGS, at a given moment. Therefore, although visibility indicat ors are a useful and important meas urement for understanding longer-term trends in visibility (and the Na tional Park Service does maintain the IMPROVE monitoring network to measure visibility impairment), it is inaccurate to suggest that modeli ng that predicts a reduction in the visibility impact of NGS can be easil y translated into actual quantification of visibility improvement at a

Class I area without further understandi ng of the other sources affecting visibility at any given moment.

Comment: Other Alternatives to BART

One individual (0064) questione d whether imposing a BART rule would be the most effective method to meet emission reductions, particularly when the economic im pacts to the Navajo Nation are largely unknown. Instead, the commenter suggested th at NGS be allowed to defer BART requirements provided that the Navajo Nation prop oses a TIP covering the following:

1. Emissions standards for NGS.

2. A plan to coordinate assets and deve lopment plans among the owners of NGS.

3. A plan to transition to cleaner production, the net result of which must be overall emissions reductions representing greater or reasonable progress than would result from the installation and operation of BART at some clearly defined future time.

Two individuals (0237, 0238) request ed that NGS comply with EP A’s proposed rule or combine

retirement and retrofits that would meet the same or greater reductions. One individual (0327)

259 See 40 CFR 49.5513(d)(4).Page 160

EPA Responses to Comments: Navajo Gene rating Station Final Rule | July 28, 2014 recommended combining the 2011 Cross-State Air Polluti on Rule with one of the proposals to enhance

the overall effectiveness of the fina l rule or consider a rule that would require NGS to shut down one unit in 2015, another in 2017, and one in 2019.

One individual (0345) recommended the OxyFuel alternative as a possible solution to mitigating

excess NO x emissions from NGS. The commenter explaine d that the OxyFuel alternative is based the principle of treating th e cause of excessive NO x emissions by minimizing the presence of nitrogen in the combustion systems in the three generating units at NGS, and added that the application of OxyFuel technology should offer an ideal tradeoff between mi nimizing emissions of NO x and minimizing the capital cost of doing so. The commenter submitted ot her technical information and data as an appendix

to its comment.

Response:

The TWG Alternative, which was developed by a group of diverse stakeholders, includes aspects of the suggestions from some commen ters that call for a combination of retirements and retrofit of units. EPA notes that a rule that requ ires NGS to shut down one unit in 2015, another in 2017, and one in 2019 would certainly reduce emissions, but at the expense of the numerous tr ibes and other stakeholders that currently rely on NGS directly for power, or indi rectly, to power CAP. Re garding OxyFuel as an alternative method for reducing emissions of NO x , as discussed elsewhere in this response to comments document, EPA’s BART determination is an emission limit, not a technology requirement. Therefore, the operator of NGS may consider and install any technology as long as it complies with the required emission limit within the required timeframe.



### 8.5 Comments on the EPA’s BART Alternative

Comment: General comments on EPA BART Alternative

Six individuals (0357, 0360, 0366, 0388, 0405, 0414, 043) specifically stated that they support Alternative 1. In contrast, one individual (0399) sp ecifically voiced opposition to Alternative 1, stating

that NGS should not be rewarded for obfuscations and delays, and highlighting that EPA is to promulgate such FIP provisions “without unreas onable delay.” One commenter (0025/0071) urged EPA to reconsider its decision to give SRP credit for NO x reducing technology and more time, and order SRP to install SCR by 2019.

One state agency (0017/0289/0320) expressed appreciation for EP A’s recognition of the unique

circumstances associated with NGS and its desire to provide more flexibility, but opposed A lternative 1

because the commenter believes that the timing is still unworkable.

Response:

EPA acknowledges the support for Alternative 1. We disagree that the LNB/SOFA credit rewards SRP for obfuscations and delays, and we note that although nearly five years has elapsed since our ANPR in 2009, EPA has been consistently worki ng to propose and finalize BART determinations

for Four Corners Power Plant and NGS since then. EP A considers our five-factor analysis and proposal to credit NGS with the early and voluntary installation of LNB/SOFA on one unit per year in 2009-2011

to be reasonable and consistent with the BART Guidelines and the RHR. EPA is exercising ourPage 161

EPA Responses to Comments: Navajo Gene rating Station Final Rule | July 28, 2014 authority and discretion under sec tion 301(d)(4) of the CAA and 40 CF R 49.11(a) to provide flexibility with respect to the the compliance timeframe for BART Alternatives. We recognize that continued operation of NGS and the Kayenta Mi ne, as a source of direct revenue s through lease payments or coal royalties to the Navajo Nation and Hopi Tribe, as well as the importance of Reclamation’s share of NGS to supply water to many tribes locate d in Arizona in accordance with seve ral water settlement acts, is of critical importance and we consider that to argue for thoughtful consideration of how flexibility in the compliance timeframe can be provided consistent w ith the air quality goals of the Clean Air Act.

As noted elsewhere in this response to comments document, although some commenters expressed concern that A lternative 1 was not flexible enough, EP A notes that our framework for BART Alternatives provided stakeholders with the ability cons ider longer timeframes for compliance provided the operator of NGS bridged the deficit in emission reductions, as compared to the BART Benchmark, by achieving additional emissions reductions. We note that the TWG Alternative was consistent with

this framework.

Comment: Support for EPA’s authority for better than BART and de layed implementation

Two of the owners of NGS (0314, 0348), a tribal government commenter (0024/0098/0316/0326), and a CAP agricultural water users group (0305) expressed support for the EPA’s determination in the February 2013 Proposal, as elaborated in the October 2013 Supplemental Proposal, that it has discretion to authorize compliance with a BART alternative providing for compliance more than 5 years after promulgation of a final FIP for NGS (citing 78 FR 8288-89; 78 FR 62511-13). The NGS owner (0348) and CAP agricultu ral water users group (0305) discussed and supported EPA’s policy and legal rationa le for its discretion to approve “better than BART” alternatives and to provide an extended period for implementati on of such an alternative at NGS. The NGS owner (0348) added additional legal support as follows:

 The U.S. Courts of Appeals for the D.C. Circ uit and the Ninth Circuit have confirmed EPA’s broad authority to approve “better than BART” alternatives in lieu of BART ( Utility Air Regulatory Group v. EPA , 471 F.3d 1333, 1340 41 (D.C. Cir. 2006); Ctr. for Energy & Econ.

Dev. v. EPA , 398 F.2d 653, 659 60 (D.C. Cir. 2005); Central Ariz. Water Conserv. Dist. v. EPA

, 990 F.2d 1531, 1543 (9th Cir. 1993)).

 The U.S. Court of Appeals for the Ninth Circuit and the U.S. District Court for the Northern

District of California have affirmed EPA’s au thority and discretion unde r the Tribal Air Rule (TAR) (citing Ariz. Pub. Serv. v. EPA , 562 F3d 1116, 1119, 1123-24, 1125-26 10 th Cir. 2009); DINÉ CARE v. EPA , 2013 WL 6327530 *4-5 (N.D. Cal.2013)).

The commenter (0348) believes that establishing an alternative BART deadline will not compromise the ultimate goal of the regional haze program, which is to achieve steady progress toward eventually eliminating human caused visibility impairment in Class I areas. The commenter added that a modest extension of the BART compliance timeframe is r easonable under these circ umstances given the long time horizon over which the program is to be implemented (i.e., a “goal” of full implementation by 2064).

The commenter (0348) also opined that the 5 year compliance period for BART that is defined in section 169A(g)(4) of the CAA applies by its terms only to: (1) SIPs, by providing that the BART compliance date shall be no later than “ five years after the date of approv al of a plan revision under thisPage 162

EPA Responses to Comments: Navajo Gene rating Station Final Rule | July 28, 2014 section ”; and (2) FIPs promulgated under CAA secti on 110(c), by providing that the BART compliance date under any such FIP shall be no later than “ five years after . . . the date of promulgation of such a plan revision in the case of action by the Administrator under section 110(c) .” The commenter stated that in contrast, the CAA establ ishes no statutory time limit on the compliance period for any BART requirement promulgated pursuant to the EPA’s “nece ssary or appropriate” aut hority under the TAR to regulate emissions from sources loca ted on tribal lands, including NGS.

One tribal government (0024/0098/0316/0326) si milarly agreed and supports the EPA’s authority for better than BART and delayed impl ementation. The commenter said that the EPA has properly used the CAA section 301(d) treatment as state (TAS) provision, as implemented under the Tribal Authority Rule in 40 CFR Part 49, in setting NO x emission limits for NGS. The commenter cited the following excerpt from the CAA TAS provision supporting the Agency’s discretion to not treat

tribes the same as states when such treatment is determined inappropriate or infeasible:

In any case in which the Administrato r determines that the treatment of

Indian tribes as identical to States is inappropriate or administratively infeasible, the Administrator may provide, by regulation, other means by which the Administrator will directly administer such provisions so as to achieve the appropriate purpose. CAA section 301(d)(4), 40 U.S.C §7601(d)(4).

The commenter (0316) noted that under the TAS, regulations were adopted that require a FIP whenever “necessary or appropriate to protect air quality” in case s where a tribe does not submit or submits an inadequate Tribal Implementation Plan (TIP). According to the commenter, the Navajo

Nation did not submit a TIP for NO x for NGS and subsequently EPA determined that in order to protect air quality a Federal regulation was needed.

The commenter (0316) added that it supports EP A’s decision that it is justified per TAS to include flexibility in terms of the compliance timeframe. While acknowledging that the CAA and the RHR require BART within 5 years, the commenter po inted out that the regulations also allow for the implementation of rules that will lead to “greater reasonable progress than w ould be achieved through the installation and operation of BART” (citing 40 CFR 51.308(e)(2)). The comme nter is of the opinion that EPA appropriately followed C AA section 301(d)(4) and 40 CFR 49. 11(a) in setting an extended timeframe for NGS compliance under the proposed alternative BART NO x emission limit. The commenter again reemphasized that EPA has appropr iately used its authority and discretion and was justified in proposing a delay timeline for co mpliance using the CAA TAS provision and TAR.

The CAP agricultural water users group (0305) expressed strong support for EPA’s consideration

of better-than-BART alternatives for NGS that extend the deadline for compliance beyond 2018, as CAA section 169A would otherwise require. The co mmenter agreed that because of the unique considerations surrounding NGS’s fe deral ownership and its prominent role in the Arizona and Tribal economies, a flexible approach th at provides adequate transition tim e for all NGS stakeholders is appropriate.

Response:

EPA agrees with the comment in support of our action to supplement our proposed BART determination with our proposed fi nding that the TWG Alte rnative meets the framework established inPage 163

EPA Responses to Comments: Navajo Gene rating Station Final Rule | July 28, 2014 our February 5, 2013 Proposed Rule. EPA agrees that we have the legal authority under the CAA and RHR to implement this bette r than BART alternative. 260

Although the comment refers to EPA’s “TAS” au thority, EPA is reading this comment as intending to refer to EPA’s “TAR” authority. “TAS” is the acronym the agency uses when it approves a tribal entity for “Treatment as State”. Nothing in this rulemaking relates to the Treatment as State regulations. Therefore, EPA is reading this comment to refer only to our “TAR” – or Tribal Authority Rule – authority.

EPA agrees that we have the authority under the CAA and the TAR to provide flexibility in the compliance date that will apply to the better than BART alternative. Specifically, EPA exercised our authority under section 3 01(d)(4) of the CAA to promulgate th e TAR. In doing so, EPA’s regulations allowed Tribes (and EPA in a Tribal FIP) to prom ulgate reasonably severabl e provisions of the CAA. 261

In the TAR, EPA exercised its aut hority to exempt Tribes from t hose provisions in the CAA that imposed SIP submittal deadlines, stating: “EPA notes at the outset that recurring provisions for which EPA is proposing not to treat Trib es in the same manner as States involve certain Clean Air Act

submittal deadlines.” 262 The TAR proposal noted:

Further, the State program submittal deadlines in the statute are based upon a relatively long history of the Clean Air Act planning and implementation by States. ( footnote omitted ) States have assumed an active role in Clean Air Act impl ementation since the 1970 Amendments to the Act. By comparison, in substantial part, Tribal authority for Clean Air Act programs was expressly addre ssed in the Act for the first time in the 1990 Amendments. Tribes, therefore, ar e at best in the early stages of developing air program expertise and planning efforts. Accordingly, EPA

believes it would be both infeasible a nd inappropriate to subject Tribes to the State program submittal and related deadlines in the statute as explained in more detail below.” 263 (emphasis added)

The TAR listed specific submittal deadlines for whic h Tribes (and EPA in promulgating a Tribal FIP) would be exempt. With respect to submittal deadlin es concerning visibility impairment, EPA stated: “EPA is not proposing to treat Tribes in the same manner as States for the provisions of section 169A or implementing regulations requiring submittal of visibility implementation plans by specific

deadlines.” 264 EPA finalized this appr oach in the TAR in 1998. 265

The TAR as codified at 40 CFR 49.11(a) provides that EPA sh all promulgate “such Federal implementation plan provisions as are necessary or appropriate to protect air quality” in Indian country where a tribe either does not submit a TIP or does not receive approval of a submitted TIP. The United

260 See 40 CFR 51.308(e)(2); CAWCD v. EPA, 990 F.2d 1531 (9 th Cir. 1993); CEED v. EPA, 398 F.3d 653 (D.C. Cir. 2005); UARG v. EPA, 471 F.3d 1333 (D.C. Cir. 2006).

261 59 FR 43956 at 43961 col. 3 (“Further, EPA is proposing to accept ‘reas onably severable’ Tribal air program submittals that meet the applicable requirement s of the CAA.”). (August 25, 1994)

262 See 59 FR at 43964, col. 3. (August 25, 1994)

263 59 FR 43965, col. 1. (August 25, 1994)

264 59 FR 43966, col. 1. (August 25, 1994)

265 63 FR 7254 (February 12, 1998), codified at 40 CFR Part 49.4.Page 164

EPA Responses to Comments: Navajo Gene rating Station Final Rule | July 28, 2014 States Court of Appeals for the District of Columb ia Circuit, the only court having jurisdiction over the issue, upheld the TAR in 2000. 266

EPA’s use of the term “provisions” indicates EP A’s determination that it may only be necessary or appropriate to promulgate a FIP of limited scope. The United States Court of Appeals for the Tenth Circuit has previously endorsed th e application of this approach in a challenge to the federal implementation plan for the Four Corners Power Pl ant. The Court stated: “[49 CFR 49.11(a)] provides the EPA discretion to determine what rulemaking is n ecessary or appropriate to protect air quality and requires the EPA to promulgate such rulemaking.” 267 The Court continued by observing that “[n]othing in 49.11(a) requires EPA . . . to submit a plan me eting the completeness cr iteria of Appendix V.” Id.

While the Court in the Four Corners case was fo cused on 40 CFR Part 51, Appendix V, EPA believes the same considerations apply to th e promulgation of this particular FIP that is being promulgated to implement the objectives set forth in 40 CFR 51.308(e) and Part 51, Appendix Y. In particular, EPA has

discretion to determine if and when a FIP addressi ng the objectives set forth in Appendix Y should be promulgated which necessarily includes discretion to determine the timing for complying with the requirements for any such FIP. The same Court recen tly reiterated that the TAR confers such discretion

for EPA to act. 268

As we have discussed in detail in this RTC, the purpose of this FIP is to protect visibility in Class I Federal areas. Congress called for “the preventio n of any future, and the remedying of any existing, impairment of visibility in mandatory class I Fede ral areas which impairment results from manmade air pollution.” CAA 169A. In keeping with our commitment to promulgate “such Federal implementation plan provisions as are necessary or appropria te to protect air quality” and in furtherance of Congress’s stated goal of “the remedying of any existing impair ment of visibility in mandatory class I Federal areas”, EPA has determined that it is appropriate to promulgate the FIP provisions set forth in this final rule at this time. As discussed above, EPA is finaliz ing its determination that a BART determination for NGS is necessary or appropriate because NO x emissions from NGS contribute to visibility impairment at 11 National Parks and Wilderness Areas (i.e. Class I fede ral areas). EPA, therefor e, believes that it is appropriate to require NGS to reduce its NOx emissi ons in accordance with the BART provisions of the

Clean Air Act in order to reduce its contribution to visibility impairme nt in those areas. Thus, absent action by EPA, the problem will not be redressed. As a result, it is appropriate for EPA to act at this time and EPA is therefore, exercising its “gap-filling” au thority in finalizing the FI P provisions set forth in

this final rule.

EPA has determined that it is appropriate to li mit the scope of the final FIP to the provisions specifically identified in this final rule. There ar e a number of reasons why promulgating this FIP of limited scope is appropriate. First, as discussed pr eviously, the owners of NGS are faced with unique circumstances. For example, two of the owners of NGS are prohibited from continued long-term participation in NGS because of state laws in Calif ornia and Nevada. Further, because NGS is located on the Navajo Nation, upcoming lease a nd right of way renewals must be approved by the Department of Interior, a federal action that triggers a multi-year review under the National Environmental Policy Act. Second, as also discussed previously , NGS is of singular importance to numerous Indian tribes located in Arizona. For these reasons, EPA has determined that it is appropriate to finalize this FIP to provide flexibility to NGS to achieve a greater than 80 percent reduction of current NOx emissions over an appropriate timeframe. Our analysis demonstrates that installation of controls to achieve this level of

266 Arizona Public Service Co. v. EPA, 211 F.3d 1280.

267 Id.

268 WildEarth Guardians v. EPA, No. 1309524, (10 th Cir. July 23, 2014) slip op. at p. 25, in the docket for this rulemaking.Page 165

EPA Responses to Comments: Navajo Gene rating Station Final Rule | July 28, 2014 reduction is cost-effective and would result in significant visibility improvement. We also find that the flexible timeframe for installing those controls is appropriate given the un ique character of NGS.

With respect to deadlines in the RHR, it sets fo rth the requirement for States listed in 40 CFR 51.300(b)(2) to submit a regional haze SIP by December 17, 2007. 269 The regulations also require States to submit a long-term strategy for regional haze in 40 CFR 51.308(d)(3). That pr ovision states: “Each State listed in 51.300(b)(3) must submit a long-term strategy that addresses regional haze visibility impairment for each mandatory Class I Federal area within the State and for each mandatory Class I Federal area located outside the State which many be affected by emissions from the State.” The first planning period for the long-term strategy is define d based on when States are required to submit comprehensive periodic revisions, established in 40 CFR 51.308(f) as July 31, 2018. 40 CFR 51.308(f) provides: “Each State identified in § 51.300(b)(3 ) must revise and submit its regional haze implementation plan revision to EPA by July 31, 2018.” However, the Navajo Nation is not a State, does not have any mandatory class I Fede ral areas within its bou ndaries, is not listed in 40 CFR 51.300(b) and based on the TAR is exempt from the SIP submittal deadlines that apply to States.

EPA, therefore, reasoned in its Supplemental Pr oposal to approve the TWG Alternative that the requirement to submit a long-term strategy does not apply to Navajo Nation or EPA in promulgating a

Tribal FIP. 270 Because the Tribe is not required to submit a long-term strategy for the period December 2007 to July 2018, the Tribe would not be required to make the showing set fort h in 51.308(e)(2)(iii) for

a better than BART alternative to achieve emissions reductions in 2018. In other words, there is no requirement for Tribes to submit a long-term strate gy showing that all necessa ry emission reductions in a better than BART alternative took place during th e first long-term strategy for regional haze. As discussed further in response to comments opposing EP A’s FIP, EPA considers it consistent with the TAR and RHR to approve the TWG Alterna tive with compliance dates in 2019, 2030 and 2044.

EPA agrees with the comment that appr oving the TWG Alternat ive for NGS will not compromise the ultimate goal of the CAA regional haze program based on progress toward eliminating

human caused visibility impairment in Class I areas by 2064. 271 Appendix B to the TWG Agreement provides that the owner/operator of NGS will be cease conventional coal fired generation in 2044. Because the TWG Agreement included the provision for the owner/operator to cease conventional coal fired generation in 2044, we are incl uding that provision in the regul atory requirements of the Final

FIP. 272 We anticipate that this means there will l ittle or no visibility-impairing pollutants from conventional coal-fired electricity generation em itted from NGS between 2044 and 2064. At its election, consistent with the Lease Amendment, the Navajo Nation may continue plant operations at NGS after December 22, 2044 consistent with EPA approval. T hus, the Navajo Nation may seek to operate NGS after 2044, however, EPA expects that operation of NGS after the owner/opera tor ceases conventional coal-fired generation would involve substantial modification to NGS and NGS would be required to meet all applicable regulatory and permitting requirements in existence at that time. Any power generating units that may be built to replace NGS w ill be subject to environmental review, including the requirement to comply with the Prevention of Signif icant Deterioration provisions of the CAA such as BACT and a visibility analysis as required by 40 CFR 52.21(p).

269 40 CFR 51.308(b).

270 See 40 CFR 49.4.

271 See CAA section 169A(1)(a).

272 See 79 FR 12944, 12950 (“While it is true that the Region al Haze Rule and BART Guide lines do not contemplate unit retirements as a potential BART option, neither rule prohibits states or EPA from considering a shutdown as part of a BART determination if the strategy is proposed by the ow ner of a BART-eligible source.”) (March 7, 2014).Page 166

EPA Responses to Comments: Navajo Gene rating Station Final Rule | July 28, 2014 For the period between 2030 and 2044, the TWG Altern ative will also have lower emissions than NGS would have if it were complyi ng with BART. The effect on visibility at the Class I areas from the

TWG Alternative’s retireme nt of the remaining two units in 2044 is discussed in more detail at in section 9.0 of this response to comments document. 273

EPA agrees with the more detailed comment s that EPA has authority under the TAR to implement a source-specific FIP requ iring BART or a better than BART alternative at NGS, specifically pursuant to CAA 301(d)(4) and 40 CFR 49.11. EPA also agre es that our authority to promulgate the FIP includes sufficient discretion to approve the TWG Altern ative for the reasons discussed in more detail in response to comments opposing our lega l authority to approve the TWG A lternative EPA agrees that the unique considerations that apply to NGS, including but not limited to its partial federal ownership, provide in part our justificati on for allowing the flexible compliance time established in the TWG

Alternative.

Comment: General opposition to EPA’s bett er than BART determinations

One environmental advocacy group (0373) stated th at EPA may approve an alternative to BART only under certain limited circumstances, with the f undamental legal requirement being a demonstration

that the alternative will “ achieve greater reasonable progress toward natural visibility conditions” (citing 40 CFR 51.308(e)) as supported by the clear weight of evidence (citing 40 CFR 51.308(e)(2)(i)(E)). The commenter indicated that there are two ways EP A can make such a demonstration (citing 40 CFR 51.308(e)(3)):

 Showing that the distribution of emissions is substantially similar under BART and the alternative measure, and that th e alternative measure provides greater emissions reductions; or

 Performing modeling to demonstrate that visibility does not decline in any affected Class I area and there is an overall improvement in visibility.

The commenter added that a BART alternative must ensure that all necessary emission reductions occur in the first planning period, which ends in 2018 (ci ting 40 CFR 51.308(e)(2)(iii)), and that any emission reductions resulting from the alternative measure mu st be surplus to reductions required under other provisions of the CAA (cit ing 40 CFR 51.308(e)(2)(iv)).

The commenter (0373) stated that for Altern ative 1 (and the TWG Alternative) EPA did not

demonstrate and cannot demonstrate that the alternatives will achie ve greater reasonable progress toward natural visibility conditions than BART. Th e commenter believes that there are multiple flaws with EPA’s proposals for each alternative, including improper use of a total NO x cap concept that fails to make greater reasonable progre ss than BART, use of an improper em issions baseline that artificially expands the cap for the alternatives only, and a lack of modeling by EPA (or TWG) to demonstrate reduced visibility impacts from the alternatives. These objections are discussed further below in subsequent comments. The commenter asserted that EPA must reject EPA BART Alternative (and the TWG Alternative) as inadequate under the law and not better than BART.

273 See also 79 FR at 12946 (“Although EPA’s regulations do not require states to consider a fuel switch or a shutdown of an existing unit as part of their BART analyses, a state can cert ainly include such options in its analysis where a company voluntarily offers such measures as a strate gy for reducing emissions.”) (March 7, 2014).Page 167

EPA Responses to Comments: Navajo Gene rating Station Final Rule | July 28, 2014 The commenter (0373) also indicated that EP A’s reliance on the TAR in this instance is misplaced. The commenter believes that EPA prope rly determined under the TAR that BART is necessary and appropriate (citing 78 FR 8279) and pr operly determined that SCR plus LNB/SOFA is BART (citing 78 FR 8287-88). According to the commen ter, with its BART determination, EPA has set the standard against which any al ternative must be measured and EPA cannot use the TAR to change

that. The commenter asserted that with the reasoni ng presented in the propos al, EPA could use the TAR to justify any decision that stra ys from the law as dictated by Congress, which the commenter characterized as “the very definiti on of arbitrary and capricious.” Furt her, the commenter contended that EPA’s use of the TAR to justify worse air quality for tribes than would otherwise be required is particularly dubious, especially in light of EPA’s Environmental Ju stice obligations under Executive Order No. 12,898 (citing 59 FR 7629, February 11, 1994).

One individual (0156) asserted that engineering problems at th e SRP Santan Generating Station, which was reviewed by S&L, cast doubt on the ade quacy of TWG Alternative and the work of S&L

related to NGS.

Response:

EPA disagrees with the commenter’s statement th at the TWG Alternative fails to demonstrate that it will “achieve greater reas onable progress toward natural visi bility conditions” as supported by the clear weight of evidence. Our terminology that an a lternative is “better than BART” is our shorthand expression for finding that the TWG Alternative comp lies with the requirement s of 40 CFR 51.308(e)(2) and (3), including the requirement that the TWG A lternative will achieve greater reasonable progress toward natural visibility conditions. 274 EPA has determined that the TW G Alternative complies with this requirement because it will result in greater total NO x emissions reductions between 2009 and 2044 than the BART Benchmark based on requiring LNB/SOFA a nd SCR to be installed a nd operated five years

after the effective date of a final rule (i.e., 2018 or 2019). 275

EPA promulgated its final revisions to 40 CFR 51.308(e) on Oct ober 13, 2006. The 2006 final rule states: “The regulations finalized today provid e that as a general matter, States must undertake source specific BART analyses under 51.308(e)(1) for each source subject to BART in order to estimate

the emissions reductions achievable under the source- by-source BART requirements. The use of such a BART benchmark enables a State to design an alternat ive program that is ‘bet ter than BART’ based on a precise estimation of the emissions reducti ons that could be achieved under BART.” 276 In UARG v.
EPA, 277 the D.C. Cir. upheld EPA’s 2005 final rule. Although UARG primarily challenged the second prong of the better than BART test promulga ted in the 2005 regulations, the court noted: “[N]onetheless, the Clean Air Act le aves wide discretion about how the goal [of reasonable progress] is to be achieved. Notwithstanding th e Act’s discussion of BART in s ection 169A(b), we have already held in CEED that EPA may leave states free to implement BART alternatives so long as those

alternatives also ensure reas onable progress. 398 F.3d at 660.”

274 40 CFR 51.308(e)(2) provides: “A State may opt to implement or require participation in an emissions trading program or other alternative measure rather than to require sources subject to BART to install, operate, and maintain BART. Such an emissions trading program or other alternative measure must achieve greater reasonable progress than would be achieved through the installation and operation of BART.”

275 See 78 FR at 8289-90 (February 5, 2013); 78 FR at 62512-13 (October 22, 2013).

276 71 FR 60612, 60618 (October 13, 2006).

277 UARG v. EPA. 471 F.2d 1333,Page 168

EPA Responses to Comments: Navajo Gene rating Station Final Rule | July 28, 2014 As discussed above, EPA established a two-prong test for showing the visibility improvement factor in a better than BART approach. The first prong of the test in 40 CFR 51.308(e)(3) is: “[i]f the

distribution of emissions is not s ubstantially different than under BART, and the alternative measure

results in greater emissions reductions, then the alternative measure ma y be deemed to achieve greater reasonable progress.” Id . The preamble for 40 CFR 51.308(e)(3) specifi cally refers to the “geographic”

distribution of emissions. The Pream ble stated: “With respect to comments on the degree of difference in the geographic distribution of emissions necessar y to trigger application of the two prong test, we believe it is not necessary for EP A to define that in the rule.” 278 The 2005 preamble to finalizing the test in 40 CFR 51.308(e)(3) contains two further relevant discussions. Firs t, EPA states: “We also recognize

that test criteria leave some term s and conditions undefined, and we be lieve States and Tribes should retain the discretion to reasonably interpret and apply these terms as appropriate to th e context of the particular program.” 279 Second, EPA clarified that the test for evaluating ‘r easonable progress’ for a

better than BART alternative was different than se tting reasonable progress goals for Class I areas, stating: “The reasonable progress te st in the reasonable haze rule rema ins as a separate test from better

than BART.” 280

Insofar as EPA is promulgating this FIP on beha lf of the Tribe, EPA retains discretion to interpret and apply ambiguous or undefined terms in 51.308(e). Accordingly, it is appropriate for EPA to

evaluate the TWG Alternative to determine whether its provisions for retiri ng capacity and installing SCR together achieve a similar geographic distributi on of emissions and will result in greater emissions

reductions than would have occurred if EPA require d BART (SCR+LNB/SOFA) at NGS five years following the effective date of the final rule

We interpret the regulations at 40 CFR 51.308(e)(2 ) and (3) to allow us to approve the TWG alternative because it results in greater emissions reductions than the BART Benchmark, with the same geographic distribution of emissions because all of the emission reductions for both will be achieved at NGS. Nothing more is required. The commenters indicate that the Alte rnative cannot have a different temporal distribution of emissions reductions than the BART Benchm ark. However, we have found no requirement to have a similar temporal distribution of NO x emissions reductions and the comment has not pointed to any such information. Rather, the comment rests on a conclusory statement.

The comment from EarthJustice, representing Si erra Club among others, a ppears to argue that EPA cannot demonstrate “reasonable progress” by allo wing greater emissions reduc tions at a later date

than would have occurred under BART. 281 Yet, Sierra Club supported a recent Oklahoma SIP BART determination, replacing an EPA FIP, which re lied on greater yet late r emissions reductions. 282 There, Sierra Club stated: “While benefits to visibility as of January 27, 2017 would be slightly greater under the FIP, the advantage is temporary. The FIP scenario may have somewhat greater benefits for several years, but the SIP Revision better achieves the overall goals of th e Regional Haze program because emissions from both units will be completely eliminated by 2026. . . .By 2026 Northeastern’s contribution to haze in the regional parks will be zero under the SIP Revision whereas under the FIP scenario the plants would continue to contribute to more than 1.5 d eciview of impairment (at much

278 70 FR at 39138 (July 6, 2005).

279 Id.

280 70 FR at 39138, n . 73. (July 6, 2005)

281 See Comment Letter from EarthJustice, pages 20-21, document number 0367 in the docket for this rule at EPA-R09-

OAR-2013-0009.

282 See Letter from Elena Saxonhouse, Staff At torney, Sierra Club, to Guy Donaldson, Chief, Air Planning Section, EPA, Region 6 dated September 20, 2013, in the docket for the rule at EPA-R09-OAR-2013-0009.Page 169

EPA Responses to Comments: Navajo Gene rating Station Final Rule | July 28, 2014 greater cost).” 283 Sierra Club also endorsed the SIP revision ov er the FIP on the basis of emissions alone, without requiring or relying on visibility modeling, stating: “Overall the SIP Revision is the less polluting option compared to the FIP. DEQ calculates that due to the decreased capacity utilization and early shutdown schedule, cumulative SO 2 and NO x emissions from Northeastern Units 3 and 4 will ultimately amount to only 36% of the emissi on [sic] that could be emitted under the FIP. See Revised BART Determination at 12. This approach is cons istent with Congress’s goal of eliminating humancaused haze by 2064, moving Oklahoma toward that goal more quickly than would the FIP.” 284

As already discussed in part abov e, EPA disagrees that the TWG Alternative must ensure that all necessary emission reductions occur in the first long-term strategy planning period, which ends in 2018, citing 40 CFR 51.308(e)(2)(iii). EPA’s reasoning on this issue is grounded in the TAR. As discussed above, the TAR was proposed in 1994 (59 FR 43956) a nd finalized in 1998 (63 FR 7254, codified at 40 CFR Part 49). In promulgating the TAR, EPA carried out our authority in CAA sections 301(a) and 301(d)(4) to allow Tribes to im plement reasonably severable provisions of the CAA. The TAR generally exempted Tribes from the CAA submittal deadlines that applied to States. EPA interprets the requirement in 40 CFR 51.308(e)(2)(iii) to constitu te a reasonably severable RHR submittal deadline that applies to States but not to Tribes. If the al ternative measure is promulgated by the State, it must “submit[s] an implementation plan containing the fo llowing plan elements and include[s] documentation for all required analyses: . . . (iii) A requirement that all necessary emission re ductions take place during the period of the first long-term strategy for regional haze.” Therefore, it is a required “plan element” for a State-only required implementation plan submittal. See 40 CFR 51.308(b)(3)(requirements for States to submit long-term strategies).

EPA’s 1999 RHR included a discussion of the fina l rule’s implementati on in Indian country.

The Preamble notes:

Section 301(d)(4) of the CAA confers discretionary authority on EPA to provide, through regulation, alternativ e means to ensure air quality protection in cases where it determines that treating tribes as ‘identical’ to States would be inappropriate. A ccordingly, in promulgating the TAR, EPA provided flexibility to tribes seek ing to implement the CAA. . . .For example, unlike States, tribes are not required by the TAR to adopt and implement CAA plans or programs, thus tribes are not subject to mandatory deadlines for submittal of implementation plans. As discussed in the preamble section identified ab ove, EPA believes that it generally would not be reasonable to impose the same types of deadlines on tribes as

on States. 285

Because it is not mandatory for the Tribe to submit a long-term strategy at any particular time, there is no mandatory requirement for the Tribe to ensure that all emissions reductions from a better than BART

alternative occur within some deadline.

This result is equitable as well as reasonable. As we stated in our Supplemental Proposal:

The regulations provide that an Altern ative to BART must ensure that all necessary emission reductions occur w ithin the period of the first long283 Id ., p. 4.

284 Id . at p. 5.

285 64 FR at 35758. (July 1, 1999). See also Dine CARE v. EPA , in the docket for this rule at EPA-R09-OAR-2013-0009.Page 170

EPA Responses to Comments: Navajo Gene rating Station Final Rule | July 28, 2014 term strategy for regional haze (i.e., by 2018) for States that were required to submit regional haze SIPs in De cember 2007. 40 CFR 51.308(e)(2)(iii). Thus, if states had submitted timel y regional haze SIPs in 2007 with BART compliance deadlines in 2012, the RHR would have provided over five additional years for the implem entation of Alternatives to BART. 286

In contrast, the TAR exempted the Tribe from s ubmitting a BART TIP on any mandatory deadline. It would be inequitable to penalize th e source seeking to comply with a better than BART alternative by requiring compliance in 4 years or less. In summa ry, EPA interprets this provision of the RHR regulations, 40 CFR 51.308(e)(2)(iii) to impose a re quirement for a submittal deadline that does not apply to Tribes. 287

EPA’s 2006 final rule also included a considerati on of Tribal issues. In response to a comment,

the 2006 final rule noted: “The EPA agrees that regulatory activities su ch as BART determinations and the development of trading programs are not by any m eans trivial and would be difficult to perform or participate in with the small staffs and limited res ources typical of many nas cent Tribal air programs.” 288

EPA then stated: “Also, EPA is committed to fulf illing its responsibility to implement CAA provisions in Indian country as necessary and appropriate, in consultati on with any affected Tribes.” 289 The comments and responses in the 2006 final rule dem onstrate that EPA anticipated implementing the RHR provisions through the discreti on established in the TAR.

The commenter also asserted th at “EPA claimed that the economi c issues justified the delay in

installation of BART” and that “EPA is incorrect in concluding, in re liance on the NREL report, that the

installation of SCR at NGS is not economical.” 290 We disagree with the comme nter’s characterization of our proposals. First, we note that in our Proposed Rule, we did not propo se a delay in the installation of BART. We proposed that BART was an emission limit of 0.055 lb/MMBtu with a compliance date within five years of the effective date of the final rule. The additional time for compliance we proposed applied to better than BART Alternatives. We also disagree that we stated that SCR at NGS was not economical, and that we relied on th e NREL report to make that conclu sion. In our Proposed Rule, we conducted our own Affordability Analysis (distinct from the NREL analysis) and concluded that “[b]ased on our analyses, the 25-ye ar NPV of costs to produce power at NGS with SCR installed and operated on all units should be below th e market prices of wholesale power.” 291 In other words, we concluded, based on our analyses, th at installation and operation of SCR+LNB/SOFA at NGS is more economical than closing NGS and purchasing an equivale nt amount of power from the wholesale market. In our Proposed Rule, we highlighted the cr itical importance of time and timing and considered “the potential economic impacts to argue for tho ughtful consideration of how flexibility in the compliance timeframe can be provided consistent w ith the air quality goals of the Clean Air Act.” 292

286 78 FR at 62513 (October 22, 2013).

287 See 64 FR at 35758. (July 1, 1999).

288 71 FR at 60627 (October 13, 2006).

289 Id

. 290 See page 23 of the EarthJ ustice comment le tter (0367).

291 See Proposed Rule at 78 FR at 8284.

292 Id. We stated “EPA understands the timing of regulatory compliance is an important consideration” and that “EPA in conjunction with DOI and DOE, have committed to work together on several short- and long-term goals, including innovative clean energy options for electricity generation and seeking funding to cover expenses for the federal portion of pollution control at NGS However, it is not clear at this time whether or what type of mech anisms might be available to

lessen increased costs.”Page 171

EPA Responses to Comments: Navajo Gene rating Station Final Rule | July 28, 2014 In summary, EPA is determining that the TW G Alternative is better than BART based on achieving greater NO x emissions reductions, based on a similar ge ographic distributio n, within the date of the goal specified in section 169A of achieving natural conditions in 2064. Given the enforceable requirement for the owner/operator to cease conv entional coal-fired generation at NGS in 2044, and with emissions in 2030 – 2044 being less than the BA RT Benchmark, the TWG A lternative satisfies the requirements of the RHR as applied based on the TAR.

Comment: BART Alternatives would interfere with 2018 RP in other states

One environmental advocacy group (0373) stated delaying the compliance date for BART will allow NGS to continue emitting pollutants in excess of the levels modeled by the WRAP. According to the commenter, this level of emissions will interf ere with the regional haze plans in three states (Arizona, Utah, and Colorado), likely negatively affec ting their ability to meet their reasonable progress goals for 2018.

Response:

The issue raised by the commenter is outside the scope of our rulemaking addressing the NO X BART requirements for NGS. Although 40 CFR 51.308(d )(3) requires states to submit long-term strategies that are sufficient to ensu re that the state has included all me asures needed to achieve its share of emission reductions agreed to through the regional planning process, the Na vajo Nation has not yet submitted a long-term regional haze strategy. In addition, EPA has not yet found it necessary or appropriate to address these requ irements through a FIP. If EPA determines it is necessary or appropriate to do so, we w ill take appropriate action.

Meanwhile, we note that for NGS , the WRAP assumed that NO X emissions in 2018 would equal 10,611 tons per year. NO X emissions under the TWG Alternative, in turn, will range from approximately 13,000 to 15,000 tons per year following the closure of one unit (or equivalent curt ailment) at the end of 2019. We also note that the closure of one unit (or equivalent curtailment) by the end of 2019 would reduce not only NO X , but also emissions of SO 2 . Given the overall changes in emissions from the various regional haze actions since the WRAP made its projections, we will be better able to assess the need, if any, for further action once Arizona, Utah, and Colorado have prepared regional haze SIPs for the second planning period.

Comment: EPA’s BART Alternative (Alternativ e 1) is not flexible enough

The operator of the Kayenta Mine (0384), who opposes EPA’s determination that SCR is BART for NGS, stated that Alternative 1 to delay instal lation of SCR on all three units a NGS a few years postpones but does not diminish or eliminate the seriou s risk of closure with all the resulting economic problems for Arizona and its resident s. The commenter indicated that the problem with this alternative remains the conclusion that SCR is BART despit e the prior installation of LNB/SOFA. The CAP operator (0343) opposed A lternative 1 (and the NO x BART proposal), arguing that the proposed NO x emission rate cannot be achieved, th at timing issues for the NGS owne rs prevent installation in the required timeframes, and that the commenter would face financing challenges. One of the owners of NGS (0314) stated that although Alternative 1 prov ides a measure of compliance flexibility, the timelines for installation of additional controls are pr oblematic and could threaten the future viability of the plant.Page 172

EPA Responses to Comments: Navajo Gene rating Station Final Rule | July 28, 2014 Response:

In our Proposed Rule, EPA proposed Alternative 1 that required complia nce with the proposed BART limits on one unit per year ov er 2021 to 2023. EPA also stated in our Proposed Rule that “to the extent there may be interest in additional fl exibility beyond the 2021-2023 compliance schedule under Alternative 1, EPA has evaluated two additional compliance schedules , using the “better than BART” analysis framework above, to evaluate additional time for compliance.” 293 Generally, EPA stated that additional time for compliance be yond 2021-2023 would be viable only if the owners of NGS achieved additional reductions to bridge the emission reduction deficit caused by delayed compliance. EPA invited suggestions for other alternatives that reduce NO x emissions at NGS a nd its contribution to visibility impairment while providing long-term, sust ainable benefits to trib es. As a result of this invitation, a group of diverse stakeh olders formed the Technical Work Group and submitted the TWG Alternative to EPA for consideration. EPA pub lished a Supplemental Proposal based on the TWG Alternative and is taking final act ion to approve the TWG Alternative as better than BART. EPA is not taking action to finalize Alternative 1.

Comment: Opposition to BART benchmark based on total emissions

One environmental advocacy group (0373) stated that EPA’s use of total emissions as a

benchmark to determine whether an alternative is “better than BART” is legally indefensible. The commenter indicated that under Alternative 1 (and TWG Alternative) EPA doe s not assess the actual impacts on visibility and the potentia l for improvement in Class I areas (which are the stated goal and obligations of the CAA) but rath er projects how much total NO x pollution might be emitted by NGS between now and an “arbitrary” date of 2044. The commenter noted that neither EPA nor TWG have performed visibility modeling on any proposed altern ative, and asserted that the absence of this “critical” modeling data ma kes it challenging or impossible to unde rstand the impact of Alternative 1 (and TWG Alternative) on affected Class I areas . According to the commenter, EPA failed to

demonstrate that the distribution of emissions is the same under BART and has not and cannot show that either alternative (but especially the TWG Alternative) will result in greater emissions reductions than

EPA’s BART determination. The commenter also c ontended that EPA has also made no showing, and cannot without modeling, that either alternative will result in greater visibility improvement to the 11 Class I areas affected by NGS pollution than will BART , either overall, but most particularly by the first haze implementation period, 2018 (citing 40 CFR 51.308( d)(1)(i)(B) and 51.308(f); the Stamper report).

The commenter (0373) believes th at by comparing only the total NO x emissions from over the entire 2009-2044 period, EPA is acquiescing to d ecades of unacceptable a nd unlawful visibility impairment at Class I areas. The comme nter stated that nothing in EPA’s NO x cap framework requires any meaningful incremental progress during this pe riod, let alone the “reasona ble progress” required by the CAA and haze regulations. The commenter contended that Alternative 1 clearly defines 3 to 6 years of additional pollution and visibility impairment, with the EPA acquiescing to significantly reduced visibility between 2018 (which the commenter defines as “as expeditiously as possible” and therefore when BART is legally required at NGS) and 2023, when the last of the NGS units is required to install SCR. The commenter added that it a “par ticularly insidious” effect of the NO x cap approach is that the longer it takes to develop the final rule, the higher the NO x cap gets, potentially delaying SCR installation necessary to meet the expanded cap.

293 See 78 FR at 8290 (February 5, 2013).Page 173

EPA Responses to Comments: Navajo Gene rating Station Final Rule | July 28, 2014 The commenter (0373) stated th at this approach is the opposite of reasonable progress and does

little to ensure that natural visibi lity will be restored in this centur y. The commenter asserted that EPA cannot and should not allow visibility in our national parks to be impa ired by the larges t pollution source in the West until 2044 because the CAA requires improveme nt with the first check-in on that progress in

2018.

The commenter (0373) added that the CAA is clear that to make the first big step on the way to “reasonable progress,” states (and EPA) must impose BART pollutant controls on the largest, most damaging sources of pollutants to Class I areas (ci ting 42 U.S.C. § 7491(b)(2)). The commenter believes that reasonable progress is the over arching obligation of the haze requ irements; BART is the required large first step in getting there. According to the commenter, the NO x cap approach simply skips the BART requirement and makes no showing of ho w those reductions will otherwise occur.

Response:

This issue is also discussed elsewhere in th is response to comments document. EPA disagrees that using a cumulative NO x cap as the benchmark for establishing wh ether an alternative is better than BART is legally indefensible.

To establish the NGS NO x BART benchmark, EPA undertook a detailed examination of the NO x emissions level that could be achieve d with the best available technology. 294 EPA established that NO x BART would be 0.055 lb/MMBtu. 295 Next, EPA considered that it was likely NGS would continue to operate until the end of its lease period. 296 NGS and Navajo Nation were negotiating a lease that would extend NGS’s operations until 2044. 297 Therefore, EPA assumed that NGS would not operate after 2044. The assumption was entirely reasonable based on the le ase and the age of NGS by 2044. In this FIP, as discussed in section 9.0 of this response to commen ts document, EPA is making that date enforceable with respect to ending conventional coal fired genera tion. To continue to oper ate after that date, NGS will need to undergo PSD permitting review wh ich would require installation of BACT.

EPA then multiplied the average heat input at NGS by the BART emission limit of 0.055

lb/MMBtu to calculate cumulative NO x emissions over 2009-2044 if NGS installed SCR in 2018 to define the BART Benchmark. EPA began the period in 2009 because that is the date that NGS began retrofitting the first of three units with LNB/SOFA . EPA also acknowledged that the installation of LNB/SOFA in 2009, 2010, and 2011 was voluntary and earl y compared to when those controls would not have been required (in combination with SCR) under BART, i.e., in 2018. 298 For that reason, EPA

calculated the cumulative NO x emissions that were achieved by in stalling and operating the LNB/SOFA early (97,715 tons) and subtracted that amount from the cumulative total emissions from the BART

294 78 FR at 8279-8280 (February 5, 2013).

295 Id

. 296 Id . at 8285. EPA assumed the remaining usef ul life of NGS for purposes of calculatin g the cost of complia nce as 20 years.

78 FR at 8285. The cost of co mpliance is directed at the useful life the emi ssions controls rather than the likelihood the facility will continue to operate. Id. For calculating the BART cap, EPA used the more realistic date of 2044 for shutting down the facility as opposed to the life of the emissions controls.

297 Id

. 298 In our Proposed Rule, we evaluated emissions assuming five years following the final rule effective date would be January 1, 2018. In our Supplemental Proposal, we anticipated that five years following the final rule effective date would be July 1,

2019.Page 174

EPA Responses to Comments: Navajo Gene rating Station Final Rule | July 28, 2014 Alternatives (EPA referred to these emissions as adjusted emissions for the Alternatives). 299 Based on this framework, EPA proposed Alternative 1 as resul ting in greater emission re ductions than BART over 2009-2044, and thus, achieving greater reasona ble progress than BART over time.

The comment criticizes EPA and the TWG for failing to perform visibility modeling. As explained above, there is no regulator y requirement for visibility modeling to demonstrate an alternative is better than BART if the geogr aphic distribution of emissions is the same as BART and there are greater emission reductions. The commenter (0373) conten ds that EPA’s analysis of the Alternatives to BART was inadequate because we “made no showing that the distribution of emissions under either

alternative is better or even substantially similar to BART”. 300 The TWG Alternative is achieving greater NO x emission reductions through retiring capacity at NGS and installing SCR at NGS. The reductions will have the same geographic distributi on as installing SCR+LNB/SOFA on all 3 units at NGS. In fact, the Miller/Sahu Report, submitted by th e commenter (0373) concedes that the spatial distribution of emissions may be the same (that all emissions and reductions come from NGS) but specifically argues that the tempor al distribution is not the same. 301 As discussed above, EPA interprets the requirement in 40 CFR 51.308(e)(3) to requ ire the emissions to be of a similar geographic distribution. There is no requirement for a similar temporal distribut ion and the commenter has pointed to none. However, as discussed in section 9.0, EPA conducted additional visibility modeling for purposes of responding to comments. As discu ssed in section 9.0, the modeling supports EPA’s determination that over time, the TWG A lternative would be better than BART.

The commenter also fails to provi de any factual information to support the conclu sory statement that the TWG Alternative does not result in greater emission reductions than BART. As discussed in a subsequent response in this sec tion, the commenter provided misleadi ng comparisons that purport to show that expected emissions under Alternative 1 or the TW G Alternative, even in compliance with the 2009-2044 NOx Cap, are much higher than BART because the commenter has generated its own target

for what it believes the BART Benchmark should be. The commenter labeled as “BART-1” or “EPA’s

BART” a case that is not consistent with BART in EPA’s proposals because it ex cludes consideration of the LNB/SOFA credit, and labeled as “CAP-1”, th e value that is consistent with EPA’s proposals. 302 The

commenter then included additional changes to the assumptions used in the calculation to generate a

cumulative emissions value for “BART” that is si gnificantly lower than EPA’s calculation and calls it

“BART-9” or “Corrected BA RT”. As discussed in section 8.0, EPA disagrees with the assumptions used by the commenter in calculating its benchmark fo r BART (e.g., the BART emission limit should be 0.04 lb/MMBtu and compliance should be required in 3.5 y ears from the final rule). EPA has calculated the

NO x emissions from BART based on our determinati on of BART for NGS, including emission limits and the need for flexibility for NGS as outlined in our five-factor analysis for NGS. Based on our calculations, the TWG Alternative will result in fewer cumulative NO x emissions than BART over

2009-2044. The 2009-2044 NO x Cap (and the 2009-2029 NO x Cap) ensures that under each applicable sub-option under the TWG Alternative (i.e., TWG A lternative A1, A2, A3, or B), NGS will achieve

emission reductions sufficient to ensure that the TW G Alternative is better than BART over the life of the facility.

299 See Tables 12 and 13 in 78 FR at 8290 (February 5, 2013).

300 See page 20 of the EarthJustice comment letter, document 0367 in the docket for this rule at EPA-R09-OAR-2013-0009.

301 See Miller and Sahu report, page 4 (document 0370 in the docket for this rule).

302 Id ., e.g., page 11. EPA finds the “CAP-1 ” terminology used by the commenter confusing because the acronym CAP is already used in our Proposed Rule to re fer to the Central Arizona Project. Therefor e, Figure 2 of the Miller/Sahu Report is especially confusing because it co nflates EPA’s propo sal with CAP.Page 175

EPA Responses to Comments: Navajo Gene rating Station Final Rule | July 28, 2014 The commenter asserts that totaling NO x emissions from 2009-2044 allows decades of unacceptable and unlawful visibility impairment at Cla ss I areas and that there is no meaningful progress as required by the CAA and haze regulations. 303 The commenter contended the BART alternatives allow significantly reduced visibility between 2018 and 2023 (Alternative 1) or 2030 (TWG Alternative). We

note that emission reductions achieve d under Alternative 1 would be delayed by five years compared to BART (not decades). Under the TWG Alternative, emission reductions would occur in phases, accounting first for the voluntary re ductions achieved beginning in 2009-2011 at NGS, closure of unit or curtailment by the end of 2019, and compliance with a limit of 0.07 lb/MMBtu on two units by the end of 2030. Thus, annual emissions under the TWG A lternative would be hi gher than BART for approximately one decade (not decades) over 2019 to 2030 (see response to comm ents in section 9.0). However, EPA has determined that the CAA and RHR do not contain any enforceable deadlines in 2018, 2023 or 2030 with respect to actions taken on behalf of the Tribe in this FIP. EPA has found no

deadlines in 2023 or 2030 that are re levant to our FIP implementing NO x BART for NGS. EPA notes

that the TWG Alternative will result in greater annual emission reductions than BART after 2030, and particularly after 2044 when the owner/operator of NGS will cease c onventional coal-fired generation (see section 9.0). EPA has determined that it is better than BART to require NGS to make a significant emission reduction in 2019, followed by addition al significant reducti ons in 2030 and ceasing conventional coal fired generation in 2044.

Comment: EPA overestimated the BART Benchmark

Aside from its assertions that an approach us ing a BART Benchmark based on total emissions is not lawful under the CAA (as discussed above), one environmental advocacy group (0373) stated that EPA’s assumptions in calculati ng a numerical value for the BART Benchmark include errors and improper credits.

 EPA’s credit for the early inst allation of LNB/SOFA runs count er to the Regional Haze Rule, EPA’s longstanding policies, and EPA’s specific st atements regarding the haze determination for NGS (citing the Stamper report; 64 FR 35714, 35728, July 1, 1999; 40 CFR part 51, Appendix Y, section IV.D.4.d.). EPA explicitly warned the operator of NGS when it submitted its application to install LNB/SOFA that the early installation of this t echnology would not affect EPA’s BART determination, and the operator ag reed in a settlement with the Grand Canyon

Trust that installation of this technology would not prejudice in any way the implementation of

more effective NO x and PM controls under the reasonable attribution and regional haze programs (citing 78 FR 8284-25). Despite these explicit ag reements and the need for timely compliance with BART, the EPA has shifted course and now proposes to delay additional controls at NGS

on the basis of the LNB/SOFA credit. EPA’ s claimed reliance on “early” LNB/SOFA is misplaced and without foundation in the facts or law.

 EPA’s proposal to delay BART due to the LNB/ SOFA credit creates a da ngerous precedent that threatens to significantly undermine the regional haze program. Although EPA stated that the use of a uniform baseline from 2001 to 2003 is impor tant for consistency in the national haze program (citing 64 FR 35728 as an example), 304 under EPA’s reasoning for NGS, aging facilities

303 See EarthJustice comment letter at page 20.

304 The commenter added that the Eight Ci rcuit Court of Appeals decision in North Dakota v. EPA , 730 F.3d 750, 62-64 (8th Cir. 2013) does not dictate a different result because in that case EPA simply asserted it need not consider existing pollution controls at all, a proposition the court disagreed with, while here, EPA properly warned the NGS operator that it could notPage 176

EPA Responses to Comments: Navajo Gene rating Station Final Rule | July 28, 2014 can avoid installing BART cont rols for many years by installing minimal, inexpensive, and plainly inadequate pollution controls as s oon as EPA begins its BART determination.

 EPA made a number of errors in it s calculations that all have the e ffect of artificially inflating the

BART Benchmark.

o EPA significantly underestimated how well S CR as BART will perform at NGS (citing

the comments summarized in section 8.1 a nd the Stamper report). Because SCR can and will achieve greater NO x reductions than estimated by EPA, the total BART Benchmark

should be corrected downward to refl ect the true capabilities of SCR.

o EPA should use updated emissions data, annual emission rates rather than 30-day rates, heat input from the baseline period, and a shor tened timeline for the installation of SCR.

Each of these corrections to EPA’s calculations reduces the total NO x emissions

associated with the EPA’s SCR as BART calculations, and accordingly reduces the BART Benchmark (citing the Miller/Sahu report).

o All told, assuming rule finalization by Ju ly 1, 2014, the corrections above reduce the estimated emissions under BART during EPA’ s chosen timeframe (2009-2044) by nearly 100,000 tons, a reduction of approximately 26 percent (citing the Miller/Sahu report).

o In addition, EPA should use actual, current heat input data and should incorporate a

shortened timeline for the installation of LN B/SOFA. Incorporating these corrections as

well serves to lower the BART Benchmar k by more than 120,000 tons (citing the Miller/Sahu report).

On this basis, the commenter asserted that if EPA persists in using the emission cap framework (which the commenter believes is never appropriate for asse ssing whether an alternativ e is better than BART),

EPA must correct the NO x cap to prevent alternatives from bei ng compared to an artificially inflated

estimate of total NO x emissions.

Another public interest advocacy group (0413) similarly commented that EPA’s credit calculations are not clear and are not well justifie d, which the commenter said will further delay cleaning up NGS. The commenter cited th e following from the Synapse report:

EPA justifies this delay as “better than BART” by arbi trarily tilting the

scales in favor of the new alterna tive. It does so by double-counting the

benefits of the installation of low-NO x burners at NGS in 2009-2011. If

NGS had waited until 2018 to install low-NO x burners, as it perhaps could have under prevailing regulat ions, then cumulative NO x emissions from 2009 through 2018 would have been about 100,000 tons higher. To

calculate emissions under its alternative proposal, EPA first calculates cumulative emissions under the alternative, including the benefits of early

installation of low-NO x burners. These emissions are higher than under the original BART proposal. EPA then gives NGS roughly 100,000 tons of emissions credit for the “early and voluntary” installation of low-NO x burners, despite the fact that it has already counted this emission reduction once. Stripped of double counting, EPA’s own numbers show that, in

avoid a full BART determination by quickly installing minimal a nd inadequate pollutant controls and EPA properly included existing controls when considering various cost components of BART—a more proper, source-specific place for consideration of existing controls.Page 177

EPA Responses to Comments: Navajo Gene rating Station Final Rule | July 28, 2014 reality, this allegedly “better than BART” alternative will result in an increase of more than 50,000 tons in cumulative NO x emissions from NGS over the period of 2009-2044. This means more pollution for the communities living around the NGS pl ant, and more haze throughout the region.

Response:

EPA disagrees with the assert ion that we are delaying BART. As stated elsewhere in this response to comments document, as well as in ou r Proposed Rule and Supplemental Proposal, EPA did not propose to “delay BART.” 305 EPA proposed to provide additiona l flexibility in the compliance

timeframe for Alternatives to BART. 306

The commenter (0373) also asserts that our propos al to credit NGS for the early installation of

LNB/SOFA runs counter to the Re gional Haze Rule, EPA’s long-standi ng policies, and EPA’s specific

statements in our BART determination for NGS. The commenter states that “EPA’s claimed reliance on “early” LNB/SOFA as an excuse to avoid or delay what is legally required is misplaced and without

foundation in the facts or law.” 307 The commenter cites three sources to support its assertion, (1) page 18 of the Stamper Report, which was commissioned by the commenter, (2) page 35,728 of the July 1, 1999 Regional Haze Rule, and (3) section IV.D.4.d of the BART Guidelines. 308 EPA disagrees with these

assertions.

First, the commenter’s use of quotation ma rks around the word “early” implies that the LNB/SOFA modifications were not, as a factual matte r, installed early. However, EPA notes that in 2008, when the operator of NGS began discussions with EPA regarding the permitting requirements associated with the significant increase in CO em issions that would result from the installation of LNB/SOFA, EPA had already begun our process for evaluating BART for NGS, but had not yet proposed a BART determination or put forth our ANPR. Therefore, no requirement existed that

mandated the installation of LNB/SOFA at NGS. In addition, the operator of NGS was aware that a BART determination, that would likely involv e, but may not be limited to LNB/SOFA, was forthcoming. As noted in our Proposed Rule, th e operator of NGS could have waited until the compliance date for BART to initiate reductions in NO x emissions, however, the operator elected in 2008 to seek the necessary permit to instal l LNB/SOFA on one unit per year over 2009-2011. 309 Thus,

because the LNB/SOFA modifica tions were made in 2009-2011, NO x emissions from NGS declined from a high of over 35,000 tons in 2 002 to less than 20,000 tons after 2011. 310 Although some of the

305 We also note that the commenter (0373) incorrectly summari zed our BART determination in their letter dated January 3, 2014. On page 9 of their comment letter, EarthJustice stated “EPA applied the BART five-fact or test set forth in the CAA and EPA regulation and as a result, finds that SCR, in combination with Low NOx Burners/Separated Overfire Air (“LNB/SOFA”) can achieve 0.05 lb/MMBtu with an emission limit of 0.07-0.08 lb/MMBtu on a 30-day rolling average. 78 Fed. Reg. at 8280.” We note that this citation actually refers to EPA’s characterization of SR P’s position of what the most stringent BART option can achieve (not EPA’s position). On the same page, EPA stated our position, i.e., “EPA is proposing

to determine that Units 1-3 can meet an emission limit of 0.055 lb/MMBtu.”

306 See 78 FR at 8288, column 1, describing our proposed BART determination. See also 78 FR at 8289, section titled “Legal Rationale for Extending Compliance Schedul e for Alternative Measures for NGS.”

307 See page 22 of the EarthJustice letter (0367).

308 See page 21 of the EarthJustice Comment letter, dated January 3, 2104. See document 0367 in the docket for this rule at

EPA-R09-OAR-2013-0009.

309 See Proposed Rule at 78 FR at 8289 (February 5, 2013).

310 See summary of annual emission date from AMPD, repr oduced in the tab titled “CAMD emissions” in the document titled “2014_0311 Better than BART Alternatives for Final Rule.xlsx” in the docket for this rule. In 2011, NGS emitted 19,900

tons of NO

x , in 2012, NGS emitted nearly 16,500 tons of NO

x and in 2013, nearly 17,500 tons of NO

x .Page 178

EPA Responses to Comments: Navajo Gene rating Station Final Rule | July 28, 2014 decline in total NO x emissions can be attributed to a decrease in capacity utilization (i.e., decline in heat input of approximately 13 percent when compar ing 2002 to 2013), the dominant contributor to the

decline in NO x emissions from NGS was from the in stallation of LNB/SOFA over 2009-2011. EPA

considers these emission reductions to be real redu ctions that were not requ ired (i.e., voluntary and surplus) and were achieved in advance of any act ual requirement to reduce emissions (i.e., early).

In addition, each of the three c itations provided by the commenter do not support its assertions that our proposal to credit NGS fo r the early installation of LNB/SOFA runs counter to the Regional Haze Rule or EPA’s long-standing policies. These three citations merely address the appropriate baseline period to use in the five -factor BART analysis. Page 18 of the Stamper Report supports our use of 2001-2003 as the baseline period for our BART de termination for NGS and cites to 64 FR at 35,728 of the July 1, 1999 Regional Haze Rule that discusse s EPA’s determination that the most appropriate baseline period would be over the 2001 to 2004 timefr ame. The baseline period is used for evaluating the costs and visibility benefits of controls. The Stamper Report also cites to Section IV.D.4.d of the BART Guidelines at 40 CFR Part 51 Appendix Y, th at states baseline emissions should represent a realistic depiction of anticipated emissions for the source, in general, based on actual emissions from a baseline period.

The commenter’s reliance on these citations is misplaced. None of these citations from the commenter address or support the commenter’s assertions that our proposed LNB/SOFA credit is

inconsistent with the RHR or EPA’s long-standing policies. Consistent with the commenter’s citations to the RHR and “EPA’s long-standing policies”, EPA us ed a baseline period of 2001-2003 (prior to the installation of LNB/SOFA) in our BART analysis for NGS. 311 We used this baseline period for determining the cost-effectiveness of controls as well as the anticipated visibility benefits of controls. Based on our analysis, using the 2001-2003 baseline peri od, EPA determined that that an emission limit

achievable with SCR+LNB/SOFA is BART for NGS . The commenter does not dispute this BART

determination. 312

The commenter also cited to the discussion in our proposed rule under Factor 3, where we described, in 2008, how the early inst allation of LNB/SOFA would not prejudice the implementation of more effective controls for BART. As stated previ ously, we did not apply th e LNB/SOFA credit to our

determination of BART for NGS. The commenter char acterizes the credit fo r early installation of

LNB/SOFA as a shift in course from the agreements and understand ings established in 2008 during the PSD permit process for the installation of LNB/SOFA. EPA disagrees with this assertion. As stated in our proposed rule, citing to the Ambient Air Quality Impact Report from the 2008 Proposed PSD Permit, EPA stated that the early installation of LN B/SOFA systems would not affect the baselines for cost or visibility improvements, and therefore will not influence EPA’s determination of the NO x reductions required for BART. 313 EPA’s BART analysis for NGS was consistent with this statement. As previously noted, EPA used the 2001-2003 period as the baseline for determini ng cost-effectiveness and

311 The commenter even stated earlier in its comment letter that “[i]t should be noted that EPA used a proper NO

x emissions baseline with determining BART in this case. In accorda nce with its own regulations and guidelines, EPA properly

considered NGS NO

x emissions from the time period of 2001-2003 for its analysis. (citation omitted) This baseline does not include the “voluntary” installation of the LNB/SOFA at a later date.” See footnote 27 on page 11 of the comment letter from EarthJustice, dated January 3, 2104.

312 See page 11 of the comment letter from EarthJustice, dated January 3, 2014, section III., titled “EPA correctly identified the installation of SCR plus LNB/ SOFA as BART for control of NOx emissions for all NGS units.”

313 See 78 FR at 8284 (February 5, 2013).Page 179

EPA Responses to Comments: Navajo Gene rating Station Final Rule | July 28, 2014 visibility benefits of controls, and determined, based on our analys is of all five factors, that

SCR+LNB/SOFA is BART for NGS.

The commenter relies on EPA’s statements about the appropriate baseline period to support an assertion that in a BART analysis, EPA should not gi ve consideration or credit for controls installed after the baseline period. 314 As stated elsewhere in this respon se to comments document (section 5.0), although we appropriately acknowledged the installation of LNB/SOFA after the ba seline period at NGS under Factor 3 (existing controls at the facility), our analysis of cost-effectiveness and anticipated visibility benefits appropriately compared S CR+LNB/SOFA against the 2001-2003 baseline period. 315
We further note that although the CAA requires cons ideration of existing po llution controls at the sources in the five-factor BART analysis, the BA RT Guidelines provide little guidance on how to consider existing controls. 316 Thus, the BART Guidelines, like the C AA, are clear that existing controls must be considered, but do not specify what or how this consideration must be conducted.

EPA’s proposed credit for early in stallation of LNB/SOFA was not associated with our five factor analysis or BART determination for NGS. Rather, EPA discussed the LNB/SOFA credit in our framework for evaluating alternatives to BART. Sp ecifically, in discussing our framework for BART Alternatives, EPA calculated the cumulative NO x reductions achieved earl y because the operator of

NGS elected to install LNB/SOFA on one unit per year over 2009-2011, instead of waiting for the compliance period for BART. In our Proposed Rule and Supplemental Proposal we used this value, the LNB/SOFA credit, when comparing BART Alternatives to BART. As discussed elsewhere in this response to comments document, EPA’ s proposal to allow BART Alternatives to take credit for the early installation of LNB/SOFA at NGS is a reasonable use of our discretion under the TAR. 317

EPA disagrees that this credit creates a dangerous precedent th at threatens to significantly undermine the regional haze program. EPA notes that part of our rationale for the better than BART framework for NGS (including the credit for the ea rly installation of LNB/ SOFA and the extended compliance timeframe for BART Alternatives) was the potential impacts to numerous tribes that rely on NGS and/or CAP, as well as the TAR and EPA’s regul ations that SIP submittal deadlines that apply to states do not apply to Tribes (or to EPA when implem enting FIPs in Indian country). EPA notes that the only other BART-eligible source in Indian country is the Four Corners Power Plant. EPA has already completed the BART determination and FIP for this facility. 318

The commenter (0373) further argues that EP A overestimated the BART Benchmark and NO x Cap. The commenter asserts that EP A’s BART Benchmark from our Pr oposed Rule was too high based on the following assertions: (1) SCR can achieve greater NO x reductions than assumed by EPA; (2) EPA

314 Although the commenters assert that EPA should not give credit to NGS for their early reductions, the commenters do not

hesitate to take credit for those reductions in their calculation of what total emissions under the BART scenario should be when they assert that EPA considered a “the made up scenario in which LNB/SOFA have not already been installed at NGS.” See page 25 of the EarthJustice comment le tter. Thus, on one hand, th e commenters argue that EPA cannot consider the early emission reductions that occurred after the baseline period, and on the other hand, the commenters count those early emission reductions that occurred after the baseline period in their calculation of total emissions under BART.

315 We note that in State of North Dakota v. EPA, the U.S. Court of Appeals for the Eighth Circuit vacated and remanded EPA’s promulgation of a FIP for Coal Creek Station because EPA did not consider the existing pollution control technologies

in use at Coal Creek Station th at were voluntarily installed after the baseline period. This document is included in the docket

for this rule.

316 See Final BART Guidelines at 70 FR at 39163 and 39166 (July 5, 2005). The BART Guidelines includes statements about considering ways to improve existing controls.

317 See 78 FR at 62511.

318 See 77 FR 51620 (August 24, 2012).Page 180

EPA Responses to Comments: Navajo Gene rating Station Final Rule | July 28, 2014 should have used updated emission data; (3) EPA shoul d have used annual average emission rates rather than 30-day average emission rates; (4) EPA should ha ve used heat input values from the baseline period; (5) EPA should have set a co mpliance date within 3.5 years.

As discussed in Section 8.1 of this response to comments docum ent, EPA disagrees that BART

at NGS should be an emission limit of 0.040 lb/MMB tu and that compliance with BART should be required in 3.5 years. EPA is setting a BART Benc hmark based on our determination that NGS can meet a limit of 0.055 lb/MMBtu within five years of the effec tive date of the final rule . Therefore, EPA is not revising the BART Benchmark or NO x Cap to assume a limit of 0.040 lb/MMBtu or a shorter compliance time for BART.

The commenter also argues that EPA should us e updated emission data, noting that the analysis

of BART and BART Alternatives that EPA included in the docket for the proposed rulemaking cited actual emissions and heat input data until 2011, and al so noted a minor discrepancy in the values we cited for 2011 and the values the commenter pu lled from the AMPD. Although EPA’s proposed BART determination was signed in January 2013 and publis hed in the FR in February 2013, EPA likely developed our analysis at a time when 2011 was the mo st recent full year of data available. Our revised analysis for this final rulemaking includes 2012 and 2013 AMPD data. 319 We note that because the

commenter asserts that NGS should not receive credit for the early installation of LNB/SOFA, the commenter represented the emissions associated w ith “EPA BART” based on actual emissions observed over 2009-2012 (and emissions ov er 2012-2019 assuming an emission rate of 0.24 lb/MMBtu, accounting for the early installation of LNB/SOFA) in lieu of EPA’s method of calculating emissions

over 2009-2019 that would have been emitted if LNB/SO FA and SCR were installed concurrently five years following the effective date of our final BART determination. Therefore, although our worksheets now include actual data for 2012 and 2013, these values for actual emissions are reflected in our

emission estimates for the TWG Alternatives , and not for the BART Benchmark or NO x Cap. EPA notes that the minor discrepancy found by the co mmenter in 2011 shows that EPA’s annual NO x emissions and heat input in 2011 were lower than those re ported by the commenter. EPA reported a value of 19,837 tons in 2011 with a total he at input of 180,463,627 MMBtu. The co mmenter reported a value of 19,840 tons in 2011 and a heat i nput of 180,490,683 MMBtu. Thus, EPA’ s values are approximately 0.015 percent smaller than those reported by the commenter. EPA is not revising the 2011 values

because the revision would result in a de minimus change.

In addition, the commenter recommends that EPA use average heat input over the baseline period (i.e., over 2001-2003) ra ther than the average over the pre- LNB/SOFA time period (i.e., average over 2001-2008) to calculate future emissions. The commenter notes that our calculations for costeffectiveness use baseline heat input over 2001-2003 to calculate pr e- and post-control emissions (approximately 5,264 tons per year). The commenter as serts that this inconsistency is arbitrary. The commenter correctly notes that EPA used the av erage heat input over 200 1-2008 (the pre-LNB/SOFA time period) to estimate emissions over 2009-2019 that would have occurred if the operator of NGS had not installed LNB/SOFA early, and emissions over 2019 to 2044 unde r BART (5,345 tons per year). The average heat input over the baseli ne period of 2001-2003 was 191,505,266 MMBtu, while the average heat input over 2001-2008 was 194,373,910 MMBtu. Th is is a difference of about 1.5 percent. EPA agrees that use of the same 2001-2003 baselin e heat input value for estimating pre- and postcontrol emission rates is appropriate and consistent with the RHR and BART Guidelines, particularly in light of the goal of understanding th e effect of a given control tec hnology on emissions (i.e., assume

319 See 2014_0311 Better than BART Alternatives for Final Ru le.xlsx in the docket for this rule at EPA-R09-OAR-2013-

0009.Page 181

EPA Responses to Comments: Navajo Gene rating Station Final Rule | July 28, 2014 identical values for baseline and future heat input to isolate the impact of control technologies). However, this approach does not mean that an aver age from the three-year baseline period (2001-2003) is most appropriate for estimating future emission s in determining a benchmark for BART. EPA notes that the use of average heat input for 2001-2008 includes the base line period recommended by the commenters and provides a larger da ta set, and therefore, a more robust average value for estimating future emissions. EPA considers the use of an averag e value based on three year s to be less robust than an average value based on eight years of data for representing potential future operation, therefore, EPA is retaining our use of the average heat input over 2001-2008 for estimating emissions over 2009-2044. EPA further notes that emission caps in permit re quirements are typically established based on the facility’s potential to emit (PTE) and would thus be calculated usi ng maximum heat input values. The highest observed annual heat input value was 199,398,687 MMBtu and, if used in the NO x cap, would result in a significantly higher BART Benchmark.

The commenter also argues that in calculating the NO x cap, EPA should use a value that reflects an annual average for post-control emission rates rather than a rate based on a 30-day average limit of 0.055 lb/MMBtu. The commenter reviewed daily data from 2000 to 2013 and calcula ted the ratio of the maximum 30-day average rate to the annual rate fo r each year and determined an average ratio of 1.135. Based on this ratio, the commenter recommended th at the BART emission limit of 0.055 lb/MMBtu (on a rolling average of 30 boiler operati ng days) be reduced by a factor of 1.135 as an estimate of what the annual average post-control emission rate would be at NGS (i.e., 0.048 lb/MMBtu). EPA agrees that generally, emission rates averaged over an annual ba sis are lower than emissi on rates averaged over a 30-day basis. However, EPA did not propose setti ng a BART limit for NGS on an annual average basis and EPA did not receive any comments suggesting that we do so. Without an enforceable annual limit, EPA considers it inappropriate to assume a lo wer emission rate in our calculation of the NO x Cap. We note that the BART Guidelines require that BART limits for EGUs be set on a rolling average of 30 boiler operating days. Therefore, although the BART Guidelines would not preclude establishing multiple emission limits over different averaging periods, the BART Guidelines do not require it.

Separately, the commenter also assert s that EPA overestimated the 2009-2044 NO x Cap. The commenter represents EPA’s NOx Cap as the scen ario it calls “CAP-1” w ith a value of 494,899 tons.

This value is consistent with the 2009-2044 NO x Cap EPA proposed in our Supplemental Proposal. 320

The commenter asserts that this value is overestimated because (1) actual heat input data should be used

to calculate the NO x Cap; and (2) the LNB/SOFA c ould be installed in two years. 321 EPA disagrees with

these assertions.

The commenter argues that for the period of 2009- 2013, actual heat input data should be used to

calculate the NO x Cap instead of the average heat input value over 2001-2008. EP A acknowledges that actual heat input data is availa ble for the 2009-2013 period, however, EPA considers using the average value to be appropriate, recognizing that years of lower than average capacity utilization will be balanced with years of higher than average capacity utilization at NGS. The commenter also asserts that

LNB/SOFA could have been required on a different (earlier) comp liance timeframe than installation of

SCR and that this idea should have been in corporated in our calculation of the NO x Cap. We note that we are setting our BART Benchmark as proposed, as a limit of 0.055 lb/MMBtu within five years of the effective date of the final rule, achievable w ith SCR+LNB/SOFA. EPA is not aware of any BART determination that required combus tion controls on a different schedu le than post-combustion controls. Although the commenter asserts that LNB/SOFA was installed in under three years (over 2009-2011),

320 See Table 3 of our Supplemental Proposal at 78 FR at 62516 (October 22, 2013).

321 See Table 3 of the Miller and Sahu Report.Page 182

EPA Responses to Comments: Navajo Gene rating Station Final Rule | July 28, 2014 EPA notes that the operator began the permitting pr ocess in 2008. Based on the permitting requirements for both combustion and post-combustion controls, EPA does not consider it prac ticable to assume the LNB/SOFA would or could have been permitted a nd installed on a separate track from the SCR.

Although the commenter makes assertions relate d to purported overestimations of the BART

Benchmark and the NO x Cap separately (i.e., in sections III and IV of the Mill er/Sahu Report), the

commenter combines all of the assertions together to argu e that the 2009-2044 NO x Cap should be 373,029 tons (121,870 tons, or 25 percent, lower than EPA’s proposed 2009-2044 NO x Cap of 494,899 tons). As outline above, EPA disagrees than a ny of the purported corrections suggested by the commenter are necessary or appropriate for proj ecting annual emissions to calculate the 2009-2044 NO x Cap.

Another commenter (0413) asserted that EPA double- counted benefits of th e early installation of LNB/SOFA, stating that EPA calcula tes cumulative emissions for the BART alternatives including the benefits of early reductions, then subsequently ap plies a LNB/SOFA credit again to BART alternatives. EPA disagrees with the assertion that we double counted emission reduc tions associated with the early

installation of LNB/SOFA.

In our February 5, 2013 Proposed Rule, EPA calcula ted the value of the LNB/SOFA credit based

on the difference between total emissions under the BART scenario where LNB/SOFA is installed concurrently with SCR and the actual scenario when LNB/SOFA was installed early. The value of this credit was then applied to total em issions over 2009-2044 under Alternative 1. 322 Although Alternative

1 does assume actual emissions with early installation of LNB/SOFA, and thus applying the LNB/SOFA credit to the BART Alternative may appear to be double counting, it is not double counting because the BART Alternatives were compared against a BART Benchmark that similarly assumed actual emissions with early installation of LNB/ SOFA. Thus, both the BART Benchmark and Alternative 1 were calculated the same way (actual emissions accoun ting for early LNB/SOFA installation), and the LNB/SOFA credit was only applied to Alternative 1. An example of double counting would have been if EPA had applied the LNB/SOFA credit to Alternative 1 and then compared that value to total emissions under BART assuming LNB/SOFA and S CR were installed concurrently.

In our October 22, 2013 Supplemental Proposal, EPA approached the calculation from a different, but equivalent perspective. The new cal culation approach was used because it was more intuitive to apply and understand in th e context of an enforceable cap in NO x emissions. In the Supplemental Proposal, the BART Benchmark was es tablished as the total emissions over 2009-2044

that would have occurred if LNB/SOFA and SCR we re installed concurrently, five years following the

effective date of the final rule. Total emissions unde r BART Alternatives were then calculated using actual emissions beginning in 2009 (i.e., accounting for the early installa tion of LNB/SOFA) and projections for future emissions. Thus, in the methodology used in the Supplemental Proposal, the LNB/SOFA credit was applied to the BART Benchmark and NO x Cap, rather than to the TWG Alternative. This method is equivalent to the one used in the February 5, 2013 proposal but does not give the appearance of double counting. In our Supplemental Proposal and supporting documents, EPA

included calculations to show that these two methods are equivalent. 323 The two methods are equivalent

because what matters in the “better than BART” c ontext is the difference between total emissions under

BART and total emissions under the BART Alternativ e. Whether the LNB/SOFA credit is applied to

322 See document titled “EPA Analysis of BART Alternative.xlsx ” in document 0004 in the docket for the rule at EPA-R09-

OAR-2013-0009.

323 See Table 2 of the Supplemental Proposal (78 FR at 62515, October 22, 2013) and document titled “Supplemental Better

than BART Alterntives.xlsx” at EPA-R09-OAR-2013-0009-0191.Page 183

EPA Responses to Comments: Navajo Gene rating Station Final Rule | July 28, 2014 BART or BART Alternatives will aff ect the absolute value of a total (e.g., using the numbers in Table 2 of the Supplemental Proposal, the LNB/SOFA credit represents a difference of 377,008 tons or 480,489 tons), but it does not affect the difference between BART and BART Alternatives. The method used in the Supplemental Proposal is more intuitive becau se BART and the BART Benchmark reflect total

emissions over 2009-2044 that would have occurred if LNB/SOFA were insta lled concurrently with SCR, and the BART Alternatives reflect actual emissions without further credit or modification.

Because no credits or modifications are made to actual emissions under the BA RT Alternatives, this method is the more logical accounting methodolo gy for determining compliance with the 2009-2044

NO x cap.

As explained above, EPA disagrees with the assertions that we double-counted or overestimated

the BART Benchmark and NO x Cap. EPA is taking final action to approve the TWG Alternative with

the 2009-2044 NO x Cap and 2009-2029 NO x Cap as proposed.



### 8.6 Additional Alternatives to BART

Comment: Alternative Recommendations to Proposal - Solar Power

One public interest advocacy group (0407) repr esenting the Black Mesa Trust proposed an alternative approach to reduce emi ssions from NGS. The commenter pr esented an alternative approach

titled “Crossroad: A Framework to Transition Na vajo Generating Station Toward Cleaner Energy Generating Station by 2025” that it feels is the best long-term solution for NGS. The commenter suggested that altern ative power be phased-in at NGS and that one coal ge nerator be decommissioned by 2019 and replaced with a combined cycle solar/ga s unit. This would reduce GHG emissions, coal mining and water use from Lake Powell by one-third. U nder this alternative approach, the second coal generator would be replaced by gas-solar or hydropower by 2024. In the commenter’s opinion, a mixture of solar, hydro power and natural or meth ane gas would be the best option, which would limit damages to the environment, cultural resources, health, and global warming. The commenter proposed that gas already available from th e Southern Ute Indian Tribe coul d easily be made accessible to NGS and natural gas would serve as a br idge until the time when NGS coul d be powered solely by renewable

energy.

The commenter (0407) proposed that a 1,000 MW so lar farm be developed on Hopi and Navajo lands; a project that would create 2,500 construction jobs. Further, the commenter proposed that a new 500 KV transmission line be created, alongside the existing Arizona Pu blic Service 500 KV El Dorado Transmission Line, and dedicate the new line to transport solar energy fr om the proposed solar fields to markets in Arizona, California and Nevada, creati ng additional jobs. In addition, the 100-acre Hopi Winslow Industrial facility could be converted in to a solar equipment manuf acturing and/or storage facility, the commenter proposed. This would lead to the development of even more jobs and a

substantial economic boost to the sm all community of Winslow. As the last element to the commenter’s proposal, it suggested that a Colorado Plateau Clean Energy Initiative be set up to serve as a research and development part of Hopi and Navaho, with the goa l being a collaborative effort to look at various ways energy can be developed us ing tribal natural reso urces and training the younger generation how to manage resources in the future.

The commenter (0407) acknowledged that the pr oposed objective would re present a substantial effort, but that if Hopi and Nava jo legislators grant conditional suppor t to move forward, the commenter was certain that seed money would be made ava ilable from Navajo and Coconino County Board ofPage 184

EPA Responses to Comments: Navajo Gene rating Station Final Rule | July 28, 2014 Supervisors and Southern California Edison (SCE). The commenter noted that SCE has set aside funds

from the sale of SO 2 credit for Hopi and Navajo to develop re newable energy projects on tribal lands. With conditional support from Hopi and Navajo legisl ators, the commenter fore sees obtaining long-termPage 185

EPA Responses to Comments: Navajo Gene rating Station Final Rule | July 28, 2014 funding from DOI, DOE, EPA, the State of Ariz ona, owners of NGS, Central Arizona Water Conservation District, and non-profit foundations.

The commenter (0407) stated that this approach would end the de structive strip mining of coal on Black Mesa, a sacred homeland of Hopi people, ther eby preserving waters stor ed in ancient aquifers for many future generations of Hopi and Navajo ch ildren. The commenter asserted that this approach, unlike EPA and TWG proposals, is not a piecemeal a pproach, but will end pollution and save the federal government millions of dollars to prepare rules to reduce mercury, carbon dioxide emissions, and other pollutants. The commenter added that this approa ch would guarantee the DOI legal commitment to Arizona tribes that are party to the 2004 Arizona Water Settlement and woul d significantly increase employment for Hopi and Navajo people and reve nues to continue to su pport Hopi and Navajo governments. The commenter concluded by stating that if the alternative appr oach it proposed in its comments is not accepted by the EPA, that the orig inal requirement, which proposed to require SCR within 5 years be finalized.

One public interest advocacy group (0356) w ho opposes both BART Alternatives, offered another solution involving solar po wer. The commenter indicated that NRG Energy is able to repower NGS with renewable energy and replace fossil fuel dependency. According to the commenter, NRG Yield and SunPower recently be gan operations at California Valle y Solar Ranch (CVSR), a 250 MW capacity plant, and the plant will sell its electricity to Pacific Gas & Electric under two long-term power purchase agreements (PPAs). However, the commen ter indicated that PPAs can be modified to incentivize utility providers to se ll their energy to California, whic h adopted the California Renewables Portfolio Standard (RPS), one of the most amb itious renewable energy standards in the country requiring investor-owned utilities, electric service providers, and community choice aggregators to increase procurement from eligible renewable ener gy resources to 33 percent of total procurement by 2020. The commenter stated that the Navajo Nation, th e State of Arizona, and Nevada need to adopt a similar Assembly Bill 32: Global Warming Solutions Act. The commenter cited key language from the bill describing steps to be taken to achieving redu ctions in GHG emissions. Th e commenter stated that government and private owned utilities must get out of the business of exploi ting people, land, water and air for profit, and begin to develop the NRG model in Phoenix and Tucson; in cluding other states like Nevada, for everyone who depend on NGS energy and to be weaned from Navajo and Hopi resources. The commenter provided further information in its comments with details on NRG Solar implementing renewable energy applications as an example that the commenter indicated could be followed to transition NGS away from using coal. The informa tion provided by the comment er describes the CVSR plant, its capacity and capabiliti es, jobs created by constructing CVSR, the economic development the plant has provided for the local economy, and to wh om CVSR currently deliver s power. The commenter provided additional information describing NRG En ergy, NRG Yield, SunPower, and NRG Safe Harbor Disclosure, and provided contact information for NR G Energy and SunPower at the conclusion of its

comments.

One individual (0025/0156) recommended sola r energy to replace NGS. One commenter (420) submitted a copy of a recommendation from the Northern Navajo Agency Council for just transition of

NGS.

Response:

EPA agrees that numerous options exist to produce electricity in a manner that results in lower emissions of air pollutants and smaller impacts to the environment and local communities. EPA recognizes that numerous stakeholders are interested in the production of clean er energy and continuedPage 186

EPA Responses to Comments: Navajo Gene rating Station Final Rule | July 28, 2014 development of the economies of the Navajo Nation a nd Hopi Tribe. However, we note that the purpose of the BART requirement under provisions of 169A of the CAA is to protect visibility by requiring existing stationary sources of a certain size and age to install the “best available retrofit technology” to reduce emissions of visibility-impai ring pollutants. This requirement doe s not require fuel-switching, or a redefinition of the source, nor doe s it give EPA authority to require replacement of existing electric generating units with alternative sources of ener gy generation. We further note that under the TWG Agreement, DOI has committed to, among other things , facilitate the devel opment of clean energy

resources. 324

Comment: Invest in Renewable Energy

One public interest advocacy group (0413) urged Fede ral agencies to invest in renewable energy for CAP power. The commenter referre d to the Synapse report and said that if one unit shuts down in 2019, 1,500 MW of renewable energy can create the sa me number of jobs and opportunities. Therefore, incentives must be provided to tribal nations tied to NGS to en courage renewable energy, in the commenter’s opinion. The commenter said that the gove rnment must apply the same dedication it did in 1969 to build and own NGS, to tribal renewable energy projects now. The commenter cited a 2013 survey conducted by Colorado College, which indicated that 74 percent of Arizona voters chose solar as their first or second choice for power while 43 pe rcent of the voters chose wind, 20 percent chose natural gas, and 6 percent chos e coal as their energy source.

Response:

As noted above, EPA recognizes that numerous stak eholders are interested in the production of cleaner energy and continued development of the economies of the Navajo Nation and Hopi Tribe. However, we note that the purpose of the BART requi rement under provisions of 169A of the CAA is to protect visibility by requiring sta tionary sources of a certain size a nd age to install BART to reduce emissions of visibility-impairing pollutants. This requirement does not requi re fuel-switching, or a redefinition of the source, nor does it give EPA authority to require replacement of existing electric generating units with alternative sources of ener gy generation. We further note that under the TWG

324 See 78 FR 62512 (October 22, 2013) and references therein.Page 187

EPA Responses to Comments: Navajo Gene rating Station Final Rule | July 28, 2014 Agreement, DOI has committed to, among other things , facilitate the devel opment of clean energy

resources. 325

Comment: Boiler tube cleaning to reduce emissions

One industry/commerce commenter (0190) recomme nded his company’s system to remove slag from the boiler tubes during NGS operation and redu ce subsequent slag formation on the tubes. The

commenter believes that this will improve boiler efficiency and reduce the amount of coal that must be combusted to produce a given amount of energy, thereby reducing emissions.

Response:

EPA notes that a BART determination represents a NO x emission limit with which each unit at NGS must comply. EPA does not speci fy what technology must be used to meet the emission limit. The operator has the discretion to implement the most re asonable and cost-effective strategy or strategies available to comply with the appl icable emission limits under BART.

Comment: Other emission reduction technologies

One commenter (0244) provided information on CEFCO emission reduction technology, which the commenter believes provides su perior emissions control. A nother commenter (0447) provided information on a PhotoBioReactor (PBR) technology to reduce emissions while growing algae to

convert to biofuels.

Response:

As noted above, EPA notes that a BA RT determination represents a NO x emission limit with which each unit at NGS must comply. EPA does not spec ify what technology must be used to meet the emission limit. The operator has the discretion to implement the most reasonable and cost-effective strategy or strategies available to comply w ith the applicable emi ssion limits under BART.

Comment: Convert to natural gas and “conde nsing flue gas heat recovery”

One industry/commerce commenter (0057) noted that the United States is has a great deal of natural gas. The commenter stated that EPA is forci ng the oldest and dirties pow er plants to be shut down for environmental and health reasons, adding that this would be a perfect time to rebuild these power plants to natural gas in thes e same locations since electricity is still required in America and the infrastructure is already in place. The commenter added that the effi ciency of natural gas combustion can be maximized through “condensing flue gas heat r ecovery” and suggested that it would be ideal to put algae ponds on the land around these power plants where coal dust and ash have been placed for 50 years or more. The commenter believes that the algae ponds could be kept at optimal warm temperatures

with the recoverable exhaust heat available from these power plants, and the exhaust gases would provide CO 2 which would enhance algae grown and be converted to oxygen by the algae. The commenter indicated that the water lost to evapor ation from the ponds could be made up by condensing

325 Id.Page 188

EPA Responses to Comments: Navajo Gene rating Station Final Rule | July 28, 2014 the water vapor from the exhaust stream, and that th e algae grown in the ponds could be harvested and processed into biofuels and other products. The commenter believes that jobs would be created in every step in this process.

Response:

EPA notes that a BART determination is an emission limit and not a requirement to install a specific technology. The facility must comply with the emission limit within the required timeframe, and the operator of NGS may consider this, or any ot her technology, in develo ping its plan to costeffectively comply with BART. As stated elsewhere in this res ponse to comments document, EPA does not have authority through BART to redefine a source to require a coal -fired power plant to convert to renewable energy or other fuel sources.

Comment: Suggested BART Alternative from CAP NIA Use rs: New controls should not be required until after 2030

One commenter (0305) presented a table purpo rting to show EPA’s calculations of the NO x caps that would apply for a range of potential BA RT emission limits: 0.055, 0.06, 0.07, and 0.15 lb/MMBtu. According to the commenter, the NO x cap that would apply under limits of 0.06 and 0.07 lb/MMBtu would exceed the Supplemental Proposal’s NO x CAP by only 2.5 and 7.5 per cent, respectively. The

commenter asserted that these differences would ha ve imperceptible impacts on visibility and that, therefore, the use of the NO x cap based on a limit of 0.055 lb/MMBtu unduly constrained TWG’s

Alternative A and resulted in an unwarranted requirement to in stall SCR on two NGS units by 2030, which would impose inequitable compliance costs on agricultural water users. The commenter stated

that a NO x cap based on a BART limit of 0.06 or 0.07 lb/MMB tu would be very similar to the proposed cap, but would provide enough of an incremental increas e to provide a minimum of 3 years of additional compliance flexibility for the installation of SCR on two NGS units.

The same commenter (0305) also stated that ev en using a limit of 0.055 lb/MMBtu to establish

the NO x CAP, with the NO x cap at the level in the Supplementa l Proposal, TWG Alternative A contains unused “headroom” that renders the operation of SCR by 2030 unnecessary. According to the commenter, TWG Alternative A has the effect of forcing NO x emissions to a level that is at least 33,000

tons below the NO x cap, which the commenter believes makes the requirement to install and operate SCR by 2030 is artificially stringent and unnecessa ry, and therefore arbitrary and capricious. The

commenter indicated that the head room under TWG Alterna tive A1 would yield more than 6 years of additional compliance flexibility for the operation of SCR, and TWG Alternatives A2 and A3 would yield more than 3 years. The commenter concluded that EPA should revise the TWG Alternatives to provide the maximum amount of compliance flexibility for installation of SCR on NGS so as to not unnecessarily impose costs on agricultural water users.

The commenter (0305) did not address NO x emissions under TWG Alternative B because that compliance approach would require the involvement of the new third parties buying into NGS and could entail a wide range of possible co mpliance scenarios. However, the commenter asserted that to the extent Alternative A is revised, Alternative B should be revised as well to ensu re continued equivalency

with TWG Alternative A.Page 189

EPA Responses to Comments: Navajo Gene rating Station Final Rule | July 28, 2014 The commenter (0305) presented the following scenar ios that it categorized as better-than-BART alternatives that would comply with a NO x cap derived from emission limits of 0.055, 0.060, 0.070, and

0.15 lb/MMBtu. The commenter described the scenarios as follows:

 Scenario 1, based on a 0.055 lb/MMBtu limit, w ould have SCR become operational on two NGS units by July 2032 and June 2033.

 Scenarios 2 and 3, based on a 0.06 and 0.07 lb/MMBtu emission limit, respectively, would have SCR become operational on two NGS units by 2034 or 2035.

 Scenario 4, based on a 0.15 lb/MMBtu emission li mit (consistent with SNCR), would be such that shutdown or curtailment of a single unit at NGS would maintain em issions at a level far

below the NO x cap. NGS’ early and voluntary installati on of LNB/SOFA c ontrols, combined with either the shutdown or curtailment by 561 MW of a unit by July 2019, would be sufficient

to control total NO x emissions such that neither SNCR nor SCR controls would be necessary to

meet the NO x cap.

Without specifically repeating the comments above, an association of CAP wa ter distributors (0398) urged EPA to address what the commenter believes are flaws in the EPA’s NO x cap determination. The commenter also urged EPA to use the identified headroom to extend the compliance date to 2033 or beyond, and to adopt the Supplemental Proposal as modi fied to account for the delay justified by this

headroom.

Response:

EPA disagrees with the assertion that new c ontrols should not be required until after 2030. As stated previously, the TWG Agreement was a nego tiated agreement, submitted to EPA, representing diverse interests. EPA evaluated Appendix B to the TWG Agreement to determine whether it was

consistent with our framework for better than BA RT Alternatives. Thus, although a few commenters may believe that the timeframes for compliance in the TWG Alternative are too stringent, the TWG

Alternative is consistent with our proposed framework and our fi nal BART determination, and it is based on a level of control that the operator and ow ners of NGS, as well as CAP, two tribes and two environmental organizations, have determined is acceptable.

As stated elsewhere in this response to comment s document, we disagree with the assertion that

BART for NGS is an emission limited associat ed with SNCR (0.15 lb/M MBtu) or a higher limit associated with SCR (0.06 or 0.07 lb/MMBtu). Theref ore, the additional time for compliance suggested by the commenters using higher BART Benchmarks or NO x Caps are not appropr iate. The commenters further assert that under their scenario 1, base d on a BART limit of 0.055 lb/MMBtu, NGS could comply with a limit of 0.07 lb/MMBtu in 2032 and 2033 and still maintain total emissions below the

2009-2044 NO x Cap. EPA disagrees with commenters that the “unused headroom” warrants additional time to comply with the limit of 0.07 lb/MMBtu. The emission estimat es that EPA presented in our Supplemental Proposal for the TWG Alternative invol ved projecting future emissions to 2044 based on average heat input at NGS over 2001-2008. Heat input in the future is exp ected to be variable and could possibly remain higher than average over an extended period of time, significantly affecting the total flexibility or compliance margin. EPA’s analysis was provided simply to assess whether operation consistent with requirements under each TWG Altern ative (A1-A3) could reasonably be determined to

maintain emissions below the 2009-2044 NO x Cap and were not intended to represent actual year-byyear emissions in the future. Thus, the “unused headr oom” is theoretical and coul d be smaller or larger than cited by the commenters. As stated previously, the TWG Alternative requires a level of control that the operator and owners of NGS, CA WCD, as well as two tribes and two environmental organizations,Page 190

EPA Responses to Comments: Navajo Gene rating Station Final Rule | July 28, 2014 have determined is acceptable EPA has determined that the TWG Alte rnative is consistent with our

framework for “better than BART” Alternatives as well as the CAA and RHR.

Comment: Suggested BART Alternative – Earthjustice

One environmental advocacy group (0373) expre ssed support for examining a BART alternative that accounts for the possibility th at some of the owners of NGS ma y choose to sell or retire their ownership interest no later than 2019, provided that the alternative produces visibility outcomes that are actually and demonstrably better th an BART. The commenter (citing th e Miller/Sahu report) suggested an alternative that includes (1) an enforceable re quirement that one NGS unit shut down by 2020 and (2) an enforceable requirement that the remaining two units install SCR and meet a NO x emission limit of 0.065 lb/MMBtu by the beginning of 2020. The commenter r ecognized that other alternatives may exist, but asserted that for any alternat ive to comply with the minimum legal requirements, it must produce better visibility outcomes in Class I areas than BART and demonstrat e that it does through the use of visibility modeling.

The commenter (0373) indicated that its suggest ed BART alternative is based on the actual modeling conducted on the TWG Alte rnative, and that the suggest ed modifications to the TWG

Alternative lead to visibi lity outcomes that are better than BA RT. The commenter included a table and graph from the Miller/Sahu report th at are purported to illustrate this assertion. According to the commenter, if the NGS owners elect to retire a single unit, as seems likely, it allows that unit to operate through 2019 without additional pollution controls, and the other two units can delay installation of SCR until the end of 2019. While 2 additional years is less ad ditional time to install SCR than EPA or TWG proposed, the commenter believes that it would allow the current round of lease negotiations to conclude before installation is necessary, a nd the new lease negotiations could take place against the backdrop of certainty as to when SCR would be required. The co mmenter noted that this illustrates one possible

alternative that is in fact better than BART and welcomed additional creative possibilities.

Response:

The comment supports a different better than BART alternative which would consist of shutting down one unit at NGS by 2020 with installation of SCR on the remaining 2 units also by 2020. The commenter also asserts that any better than BART a lternative must demonstrate better visibility results at Class I areas through modeling.

EPA disagrees with both of these comments. CA A section 169A and the RHR set out a process for EPA to determine BART. EPA is required to cons ider and balance five factors. BART is not the same as BACT, where we are evaluating the lowest emission limit that can be achieved when a new source is being constructed. For the statutory and regulatory provisions at issue in this rulemaking, EPA is constrained by its consideration of the five BART factors. After we proposed NO x BART for NGS, a diverse stakeholder group submitted Appendix B to the TWG Alternative containing recommended provisions for a better than BART alternative. Appendix B was not submitted to EPA as a menu of options to choose. It was submitted as a complete alte rnative. EPA does not have the authority to require subject to BART units to shutdown. EPA can, however, co nsider a unit’s closure as part of a BART or a better than BART analysis “where a company vol untarily offers such measures as a strategy for reducing emissions.” 326 Appendix B of the TWG Alternative incl udes options to voluntarily shutdown or

326 79 FR 12944 at 12946 (March 7, 2014)Page 191

EPA Responses to Comments: Navajo Gene rating Station Final Rule | July 28, 2014 curtail operations at one unit at NGS in 2019. The TW G Alternative also include d installation of SCR on the remaining units in 2030, not 2020.

EPA does not consider it necessary to require on e unit at NGS to shutdown or curtail operations by 2020 and also to require installa tion of SCR at that time. Appendix B to the TWG Agreement as it was submitted to EPA results in greater NO x emissions reductions than the BART determination we proposed in February 2013. Because the TWG Alternative, which is c onsistent with Appendix B to the TWG Agreement, results in greater NO x emissions reductions from 2009 – 2044, and significantly better

NO x emissions reductions from 2044 – 2064, EPA is exerci sing our discretion to fi nalize our approval of it. The commenter relies on the modeling analysis pr ovided in the Miller/S ahu report to support its assertion that shutting down one unit by 2020 and installing controls on the remaining units in 2020 will provide better visibility improvement . EPA has provided the reasons we disagree with the values used in the Miller/Sahu report in responses elsewhere in this document.Page 192

EPA Responses to Comments: Navajo Gene rating Station Final Rule | July 28, 2014 

## 9.0 Comments on the TWG Alternative and EPA’s Supplemental Proposal

Comment: Support for Supplemental Proposal of TWG Alternative

Many individuals (0145, 0146, 0147, 0148, 0161, 0165, 0167, 0168, 0193, 0200, 0203, 0205, 0206, 0208, 0209, 0211, 0212, 0222, 0224, 0226, 0230, 0231, 0232, 0243, 0247, 0264.4, 0265, 0273, 0272, 0298, 0307, 0308, 0310, 0329, 0330, 0335, 0382, 0392, 0437), government commenters (0017, 0159, 0223, 0239, 0258, 0287, 0289, 0297, 0300, 0320, 0324, 0332, 0406, 0411, 0443), tribal governments (0316, 0317, 0340, 0387), local gov ernment commenters (0176, 0189, 0199, 0201, 0207, 0213, 0256, 0263, 0280, 0293, 0295, 0296, 0328, 0383), public/pri vate coalitions (0381, 0400), chambers of commerce (0188, 0282, 0304), the owners of NGS (0314, 0315, 0348), the operator of CAP (0343), the operator of the Kayenta Mine (0384), and industry and i ndustry trade associations (0274, 0278, 0306, 0338) urged EPA to approve the TWG Alternat ive. Most of these commenters specifically

stated that the TWG Altern ative is a fair compromise created by a diverse group of st akeholders that achieves greater NO x reductions than EPA’s proposed rule . These commenters believe that the Supplemental Proposal will provide a path for future operation at NGS and serv es the interest of CAP water users by reducing and delaying SCR installation and operation expenditures. Furthermore, many of these commenters opined that the TWG Alternativ e is consistent with the TWG Agreement, which will allow for further economic development and the development of renewable energy projects that could benefit Native American tribes and the peop le of Arizona. Two CAP water distributors (0194, 0214) an association of CAP water distributors (0252), and an industry/co mmerce commenter (0416) made many of the same points. Although supporting the TWG Alternative, one commenter (0264.4) encouraged Arizona to incorporate alternative energy sources, which the commenter believes is essential to ensuring reliable and affordable water and power in th e future, as well as being in the best interest of our national security. Some comment ers also noted that the TWG Alternative was consistent with the federal trust responsibility to Indian tribes, w ould honor existing water settlement agreements, and mitigate economic harm to Indian and non-Indian co mmunities without adding to the federal deficit by imposing additional costs on taxpayers.

Two commenters (0395, 0411) also noted that the TWG Alternative would reduce an array of pollutants from NGS by one-third, including GHG, toxic metals, a nd other pollutants that are

detrimental to human health such as PM and SO 2 . The commenter (0411) also noted that if implemented, the TWG Alternative would decrease the amount of water needed at NGS and the Kayenta coal mine. One commenter (0395) not ed that it is supportive of the TWG Alternative because, over its life, it is projected to achieve gr eater overall visibility improvement because one generating unit at NGS is expected to be retired or curtailed by th e end of 2019. The commenter opined that these multipollutant reductions would not occur under EPA’s BART proposal. The comm enter stated that it strongly supports TWG Alternativ e A, which in total reduces NO x emissions by 16,000 tons more than the proposed BART or A lternative 1, will reduce SO 2 emissions by 1,600 tpy, or as much as 33,000 tons on a cumulative basis, and direct PM by 1,000 t py, or 24,000 tons cumulatively. The commenter emphasized the importance of consid ering the benefits in protecting public health from emissions of direct particulates and SO 2 , as well as protecting visibility by reduc ing emissions of th ese pollutants, in EPA’s decision-making process. The commenter last ly noted that TWG Alternative A would also

achieve a direct reduction in CO 2 emissions by about 7 million tpy or cumulatively 166 million tons. Further commitments made by the DOI as part of the TWG Agreement will lead to additional CO 2 reductions by 11 million metric tons between 2015 and 2035, the commenter said. In the commenter’s opinion, these measures will provide human health, we lfare and environmental benefits beyond those ofPage 193

EPA Responses to Comments: Navajo Gene rating Station Final Rule | July 28, 2014 the proposed BART or Alternative 1. The commen ter said that EPA should conduct a comparative emission reduction benefit analysis and present th e findings of that analys is in the final rule.

The Navajo Nation (0316) opined that the TWG Agreement is very important to the Navajo Nation because it provides significant benefits from th e Federal government in assisting with future lowemitting energy projects on the Navajo Nation and is least likely to result in adverse impacts on the Navajo Nation. The Ak-Chin Indian Community (0387) noted that it r eceives it entire water supply through the CAP system and holds a substantial stake in ensuring that the impact of the regulation will maintain the viability of CAP. The Ak-Chin opined on the federal trust responsib ility to Indian Tribes and noted that the federal government is therefore responsible for guara nteeing tribal water entitlement.

The commenter further noted that the Ak-Chin Indian Community was also excluded from participation in the development of the TWG Agreement, and indi cated that it understands the concerns expressed by the Hopi Tribe and other tribes that were excluded, about conditions related to the proposed better than BART Alternative. However, the commenter supports the TWG Altern ative and urged EPA to finalize the rule as soon as possible.

The Gila River Indian Community (0317) reco mmended that EPA finalize the TWG Alternative because it is best available option that will allow NGS to continue to produce power and ensure the rights of CAP water recipients. The commenter disa greed with EPA’s statements in the Supplemental Proposal that EPA would not respond to comments received on other elements of the TWG Agreement other than the Appendix B to the TWG Agreement. Th e commenter stated that the Agency must take

into account the other elements of the TWG Agreement require d by Federal regulations when determining BART. For example, the commenter indi cated that the TWG Agreement contains several elements related to clean energy commitments by th e United States that is a positive impact on the

environment and of economic benefit to Indian Tr ibes and the area around NGS. The commenter asserts that these benefits would only occu r if the TWG Alternative is fina lized. The commenter specified the following positive environmental impacts:

 The DOI will commit to reduce the CO 2 associated with the energy used to pump CAP water by 3 percent annually for a total of 11.3 million metr ic tons to be achieved at NGS or through qualifying low-emitting clean energy proj ects no later than December 31, 2035.

 To advance clean energy economic development that benefits the Indian tribes affected by NGS, DOI will facilitate the development of Clean Energy Projects at a pace and scope to achieve 80 percent Clean Energy by 2035 for the U.S. sh are in NGS by securing approximately 26,975,000 MWh of Clean Energy Projects.

 DOI will identify, prioritize, and further low emitting energy projects to benefit affected tribes, such as a 33 MW solar facility proposed by the Gila River Indian Community and local, community based and large-scale renewable energy proj ects within the Navajo Nation and the Hopi Tribe.

 DOI will commit to carry out the NREL Phase 2 Study to analyze options for the future of NGS, including identifying options fo r replacing the federal share of energy from NGS with low emitting energy resources.

Although the Tohono O’odham Nation ( 0340) indicated that it supports the TWG Alternative, it strenuously objects to how the working group was form ed and operated. The commenter’s concerns are

discussed in more detail in section 10.0. In additio n, the commenter expressed c oncerns over the lack of specificity around the number of commitments by the DOI under the TWG Agreement. The commenter opined that there are areas of the TWG Agreem ent that are unknown, specifically how the DOI commitments will be funded and what the impact of these commitments will be on the LCRBDF and onPage 194

EPA Responses to Comments: Navajo Gene rating Station Final Rule | July 28, 2014 the Tohono O’odham Nation’s Cooperative Fund, and if expenditure of funds from the Reclamation Water Settlement Fund, as proposed, is consistent with the authorization in that statute.

Response:

EPA recognizes that numerous commenters supported the Appendix B to the TWG Agreement and EPA’s proposal of the TWG A lternative in our Supplemental Proposal. Specific comments on the exclusion of numerous stakeholders from particip ating in the TWG were in cluded in more detail

elsewhere in sections 9 and 10 of the response to comments documen t. EPA agrees with commenters that the closure or curtailment of one unit, associat ed with the TWG Alternativ e, will result in other environmental benefits than just NO x reductions. As noted by commenters, emissions of other pollutants, including SO 2 , PM, CO 2 , and hazardous air pollutants would be reduced by approximately one-third. EPA recognizes that under the TWG Agreemen t, DOI made several additional commitments, not directly related to BART, th at benefit tribes and the envir onment. Although EPA recognizes these benefits, because EPA was not party to the TWG Ag reement, not a signatory of the TWG Agreement, and not directly involved in DOI’s commitments under the TWG Agreemen t, EPA is not the appropriate agency to address comments or other concerns relate d to aspects of the DOI’s commitments that are not contained within Appendix B of the TWG Agreement.

Comment: Opposition to TWG Alternative becaus e it is premised on SCR as BART

A CAP agricultural water users group (0305) argued that the NO x emission cap used for the TWG Alternative is unduly and arbitrarily stringe nt because it is based on a BART limit of 0.055 lb/MMBtu, which the commenter beli eves is too stringent (as discu ssed elsewhere in this document) because (1) EPA should not have determined that SCR is BART and (2) even if SCR were the appropriate basis for BART, 0.055 lb /MMBtu is not achievable. Acco rding to the commenter, the TWG Alternative would unnecessarily an d unfairly impose high costs on agri cultural water users to pay for SCR technology that will not be requir ed to be in service until after the agricultural water users are no longer getting the benefit of NGS power. The comment er stated that because Arizona agricultural users will phase out their use of CAP Ag Pool wate r by December 2030 pursuant to the Arizona Water Settlements Act (AWSA), capital costs that are colle cted in advance of SCR operation will be imposed on Arizona agricultural water users in exchange for no benefit. The commenter asserted that if EPA

finalizes either of the “better than BART” Alternativ es without modification, it would be arbitrarily and capriciously apportioning compliance costs to ag ricultural water users for which they are not responsible. Given EPA's acknowledgment of the complian ce flexibility that exists with respect to FIPs under the TAR, and with respect to the NGS specifi cally, the commenter believes that the failure to consider potential “better than BART” Alternatives that would afford compliance flexibility to all NGS

stakeholders on an evenhanded basis constitutes an abuse of discretion on the part of EPA.

Response:

EPA disagrees with the assert ion that the TWG Alternative is unduly and arbitrarily stringent

because it is based on a BART li mit of 0.055 lb/MMBtu. EPA addressed comments related to the BART limit in section 8.1 of this response to comments document. We note that the TWG Alternative is consistent with Appendix B to the TWG Agr eement, which was developed among six diverse stakeholders, including SRP, the operator of NGS on behalf of itself and other co-owners, and the

Central Arizona Water Conservation District. A lthough both entities submitted comments in opposition to the proposed BART limit of 0.055 lb/MMBtu, both parties signed the TWG Agreement thatPage 195

EPA Responses to Comments: Navajo Gene rating Station Final Rule | July 28, 2014 establishes the NO x Cap based on compliance with the propose d BART limit of 0.055 lb/MMBtu within five years. This underscores the fact that A ppendix B to the TWG Agreement was a negotiated agreement, submitted to EPA, representing diverse interests. EPA evaluated Appendix B to the TWG Agreement to determine whether it was consiste nt with our framework for “better than BART” Alternatives. Thus, although a few commenters may belie ve that the TWG Alternative is too stringent, it is consistent with our proposed framework and consis tent with a level of cont rol that the operator and owners find acceptable.

The commenters indicate that thei r access to CAP Ag Pool water is expected to end in 2030, and assert that the timeframes for compliance with the limit of 0.07 lb/MMBtu in 2030 would necessitate water rate increases prior to 2030. The commenter a sserts that it is arbitrary and capricious for NIA water users to pay a few years of higher CAP water rates for controls that will not be operational until after their access to the CAP Ag Pool expires. EPA not es that the direct impact of compliance with the limit of 0.07 lb/MMBtu in 2030 under the TWG Agreemen t, presumably with installation and operation of SCR, would be on the cost of electricity genera tion. Increasing water rates ar e indirect impacts that result from the relationship between NGS and CAP. EPA does not set or dete rmine water rates charged by CAWCD to the CAP Ag Pool or any other clas ses of CAP customers. EPA’s proposed and final approval of the TWG Alternative as a better than BART Alternative is base d on our review of the anticipated emission reductions a ssociated with the TWG Alternat ive compared to BART. Although EPA, DOI, and DOE have committed to work together on many issues related to NGS, including funding for the federal portion of capital improvement s at NGS, EPA does not determine how controls

would be financed and how and when electricity or water rates would be adjusted to recover costs. Finally, EPA also notes, as stated previously, that the timeframes fo r compliance with the limit of 0.07 lb/MMBtu were not established by EPA and were determined by the TWG as a negotiated compromise

between diverse stakeholders.

Comment: Request public comment on better-than-BART alternatives at higher level of NO
x cap

A CAP agricultural water users group (0305), while disagreeing with the methodology used by

EPA to calculated the NO x cap (as discussed elsewhere in this document), supported EPA’s subsequent upward adjustments to the cap. However, the commen ter stated that EPA should solicit comment from the public on whether there are othe r better-than-BART alternatives that stakeholders might propose that would comply with the revised NO x cap and provide greater flexibil ity. The commenter asserted that EPA’s failure to request that the public submit such alternatives woul d be arbitrary and capricious given

that the EPA has now stated that the NO x cap is 494,899 tons but has onl y requested better-than-BART proposals that comply with the previously-proposed NO x cap of 451,149 tons.

Response:

EPA disagrees with the comment that we must solicit public comment on other “better than

BART” Alternatives to co mply with the 2009-2044 NO x Cap of 494,899 tons in the Supplemental Proposal. Although the commenter refers to th e value 451,149 as the “previously-proposed NO x cap”, EPA notes that in our February 5, 2013 Proposed Rule, we did not propose any NO x emission caps and used the total emissions over 2009-2044 simply as the BART benchmark against which BART Alternatives should be compared. The value of 4 51,149 represents the sum of two values from our Proposed Rule: the total emissions over 2009-20 44 under BART (i.e., the BART threshold or benchmark at 358,974 tons) and the LNB/SOFA credit ( 92,175 tons). Thus, contrary to the assertion of the commenters, EPA did not “change the NO x cap” because EPA did not sp ecifically propose an actualPage 196

EPA Responses to Comments: Navajo Gene rating Station Final Rule | July 28, 2014 emission cap over 2009-2044 in our Proposed Rule. Howe ver, to the extent that the commenter is concerned that the public was not invited to submit additional alternatives to comply with the 2009-2044

NO x Cap of 494,899 tons in the Supplemental Propos al, EPA notes that we accepted comment on all aspects of our proposals, irrespective of whether EPA highlights a particular que stion or aspect of our analysis for public comment. At any time during the public comment period for our proposals, any group or member of the public could have provide d comments on the absolute value of the BART Benchmark, the NO x Caps under the TWG Alternative, or a “b etter than BART” Alte rnative that meets any benchmark or cap value that the commenter dete rmines is appropriate. For example, one commenter (0367/0370) submitted comments asserting th at the absolute value of the 2009-2044 NO x Cap, as proposed, was too high, submitted a revised value for the NO x Cap, and an additional BART Alternative to EPA for consideration (closure of one unit in 2 020 and an emission limit consistent with SCR on the remaining two units in 2020, as discussed above). 327

EPA stated in our Proposed Rule that “EPA seeks comment on the analysis and conclusions presented in this proposal and invites sugges tions for other alternatives that reduce NO x emissions at NGS and its contribution to visibility impairment while providing long-term sustainable benefits to

tribes.” 328 In our Supplemental Proposal, we stated that “EPA is accepting public comment concurrently on our February 5, 2013 proposed BART determin ation and proposed Alte rnative 1 and the TWG Alternative put forth in toda y’s Supplemental Proposal.” 329 EPA further stated that “after considering public comments, EPA may finalize pr ovisions from either or both pr oposal, i.e., our proposed BART determination, proposed Alternativ e 1, or the TWG Alternative.” 330 Although EPA did not explicitly request comment on additional BART Altern atives in the context of the 2009-2044 NO x Cap of 494,899 tons, we note that our statements are clear that EP A is accepting comment on all aspects of the analysis

and conclusions and that the final rule may include provisions from either or both proposals, after consideration of public comments. 331 Thus, it is implicit that the public may submit general or specific comments on any aspect of both proposals, including additional alternatives, BART benchmarks, or NO x emission caps as described in the Propos ed Rule or the Supplemental Proposal.

Comment: TWG Alternative does not fully meet EPA’s oblig ations to the Gila River Indian Community

One tribal government commenter (0039/0317) said that even though it is in full support of the TWG Alternative, it raised concerns that even under this alternative EPA has not met its obligations to the Gila River Indian Community because of the si gnificant costs BART will have to NGS and impact the Community. Rather, the commenter views the TWG A lternative as the first st ep in a process that will limit the impacts on the Community because only if the TWG Alternative is finalized will key U.S. commitments contained in the TWG Agreement be realized. Specifically, under the TWG Agreement, and as outlined by the commenter in comments above, the DOI will work with the Gila Indian River Community and other tribes in the area around NGS, to evaluate the actual impacts the regulatory requirements will have on NGS over time. The comment er specifically referred to the U.S. commitment

327 See comment letter from EarthJustice, document number 0367 in the docket for the rule at EPA-R09-OAR-2013-0009.

328 See 78 FR at 8291 (February 5, 2013).

329 78 FR at 62518 (October 22, 2013)

330 Id..

331 We further note that in our Proposed Rule and Supplemental Proposal, EPA explicitly requests public comment on very few specific aspects of our analysis, but that does not precl ude the public from submitting co mments any and all aspects of any document in our docket for the rulemaking, as well as docu ments or ideas that are not in cluded in our analysis and

docket.Page 197

EPA Responses to Comments: Navajo Gene rating Station Final Rule | July 28, 2014 to allocate $10 million annually for 10 years starting in 2020, from the Reclamation Water Settlements Fund to reduce impacts to the LCRBDF.

Response:

EPA acknowledges the comment and is aware that costs associated with implementing the TWG Alternative will have implications for numerous Tr ibes, including the Gila River Indian Community. EPA is committed to continuing to work with the De partment of the Interior and the Department of Energy in the Interagency Working Group on NGS, as la id out in the Joint Statement signed in January 2013 by the heads of the three agencies , to work with tribes to addre ss long-term issues related to NGS. The provisions in the TWG Agreement that are not re lated to EPA’s authority to evaluate BART or a “better than BART” alternative, however , are beyond the scope of this rulemaking.

Comment: Preference for TWG Alternative A

One individual (0221) acknow ledged that EPA’s proposed BART rule for NGS would effectively reduce the emissions produce by the plant, but asserted that the cost of doing so would be drastic. Therefore, the commenter believes that the proposed TWG Alterna tive A would be a better option, because it would help ease the financial burden of installing three SCR units while still reducing emissions to a lower level than the EPA’s proposed rule, and by allowing NGS to temporarily shut down one unit or reduce the generation of all three units, the plan t would still stay under the required level of

0.055 lb/MMBtu. The commenter further noted that a lthough the TWG Alternativ e B also requires the

reduction of NO x emissions it does not outline how this reduction would be completed, and the requirement of annual Emission Reduction Plans w ould require owners to continuously monitor

emission rates which can be burdensome.

Response:

EPA agrees that TWG Alternative A is simp ler and provides more specificity than TWG Alternative B. However, contrary to the comm enter’s statement, EPA notes that the closure requirements under TWG Alternative A1 and A2 represent permanent closure of one unit.

Comment: Objection to NO
x cap

As discussed in greater detail above in se ction 8.5, one environmental advocacy group (0373)

stated that EPA’s use of total emissions as a benchm ark to determine whether an alternative is “better than BART” is legally indefensible. The commenter indicated that under th e TWG Alternative (and Alternative 1) EPA does not assess the actual impacts on visibility and the potential for improvement in Class I areas (which are the stated goal and obligati ons of the CAA) but rather projects how much total

NO x pollution might be emitted by NGS between now and an “arbitrary” date of 2044.

The commenter (0373) believes th at by comparing only the total NO x emissions from over the entire 2009-2044 period, EPA is acquiescing to d ecades of unacceptable a nd unlawful visibility impairment at Class I areas. The comme nter stated that nothing in EPA’s NO x cap framework requires any meaningful incremental progress during this pe riod, let alone the “reasona ble progress” required by the CAA and haze regulations. The commenter asserted that for the TWG Alte rnative, it appears NGSPage 198

EPA Responses to Comments: Navajo Gene rating Station Final Rule | July 28, 2014 owners could avoid NO x emissions reductions for decades, and then retire capacity at the last minute as needed to just barely stay under the cap by 2044.

Response:

This issue is also discussed elsewhere in this document. See responses and comments in section

8.5.

Comment: Errors in calculations a nd assumptions in the NO
x Cap

Notwithstanding its assertions that a NO x Cap is unlawful under the CAA (as discussed elsewhere), one environmental advocacy group (0373) st ated that EPA’s calculations and assumptions

for the NO x cap include errors and improper credits (these points are summa rized in detail in section 8.5 of this response to comments document). The comment er concluded that if EP A continues to use the

NO x cap framework (which the commenter believes is never appropriate for assessing whether an

alternative is “better than BA RT”), EPA must correct the NO x cap to prevent alte rnatives from being compared to an artificially inflated estimate of total NO x emissions.

The commenter (0373) stated th at the graphs used by EPA in its discussion of the TWG Alternative are misleading because th ey label as BART a line that the commenter believes is clearly not BART but “a made up scenario in which LNB/SOFA have not already been installed at NGS (in other words, the NO x cap).” The commenter attached a graph fro m the Miller/Sahu report which, according to the commenter, includes an addition al line that represents the “actual BART” as calculated by EPA and

shows that the TWG Alternative and the NO x cap are substantially worse than BART.

Response:

Regarding the concerns raised about EPA’s calculati ons and assumptions in calculating the NO x Cap, see EPA’s response to a similar comment in section 8.5 regarding EP A’s calculations and assumptions for the BART Benchmark, which formed the basis for the NO x Cap in the Supplemental Proposal. As discussed in our re sponse in section 8.5, EPA disagrees that the BART Benchmark and

NO x Cap were inflated. EPA is taking final action to approve the TWG Alte rnative with the 2009-2044

NO x Cap and 2009-2029 NO x Cap as proposed.

EPA disagrees with the comment that our graphs in the discussion of the TWG Alternative were misleading. In our Proposed Rule and our Supplementa l Proposal, EPA clearly stated that for NGS, we were proposing to give credit for the early and voluntary installation of LNB/SOFA on one unit per year in 2009, 2010, and 2011. The difference between the two lines the commenter asserts to be “made up

BART” and “actual BART” is the LN B/SOFA credit. In addition, the underlying worksheet for EPA’s graph depicting BART and the TWG Alternative indicates that BART is “5-year BART as if LNB was not yet installed” and we calcula ted this value to be 494,899 tons. Th is value was reported in our Supplemental Proposal, where we describe our app lication of the LNB/SOFA credit to the BART Benchmark from our February 5, 2013 Proposed Ru le. EPA recognizes that some individuals may interpret this idea as a “made up s cenario” and we also recognize that if not for the LNB/SOFA credit the alternatives to BART considered in our propos als (Alternative 1 and th e TWG Alternative) would not be “better than BART.” Fundamentally, this comment addresses the fact that the commenter disagrees with the early inst allation credit for LNB/SOFA.Page 199

EPA Responses to Comments: Navajo Gene rating Station Final Rule | July 28, 2014 As stated in our proposed rules, EPA is exer cising our discretion and authority under the Regional Haze Rule and the TAR to propose a flexible timeframe for an alte rnative measure under the RHR for NGS and a key part of the flexible timeframe is our recogniti on that the owners of NGS elected to install LNB/SOFA early and voluntarily, and that our BART Benchmark requiring a limit of 0.055 lb/MMBtu represents the level that would be ac hieved with SCR in combination with LNB/SOFA. Thus, the owners of NGS could have waited until five years after the effective date of our final BART determination (i.e., 2019) to install LNB/SOFA. Howe ver, because the owners installed LNB/SOFA on one unit per year in 2009, 2010, and 2011, th e environment realized actual NO x reductions approximately 10 years earlier than would have been achieved under BART. These early emission reductions are real and EPA proposed the LNB/SOFA credit supporting a flexible timeframe for NGS based on the discretion provided under secti on 301(d)(4) of the CAA and 40 CFR 49.11(a). 332

Comment: TWG Alternative is vague and unenforceable

One environmental advocacy group (0373) stated th at a BART determination must include clear requirements for emissions reductions and a clear time line for those reductions, to ensure continuing visibility improvements in Class I areas. According to the commenter , the future ownership scenarios and associated emission control possibilities incl uded in the TWG Alternativ e are at best vaguely defined and at worst entirely open-ended and une nforceable. The commenter indicated that without specific emission limits and/or commitments to reti re specific amounts of capac ity from specific units, as of a date certain, it is impossi ble to calculate the visibility impr ovements that will result from the TWG Alternative, and it will be impossible for indivi duals or EPA to assess whether NGS is on track to meet the emission reductions necessary to ensure reasonable progress towa rd natural visibility affected

Class I areas. The commenter asserted that such an undefined and unenforceable plan to reduce emissions at some point in the future is not adequate to substitute for a date-certain and emission ratespecific BART requirement. The commenter added th at the proposed requirement for NGS to submit annual Emission Reduction Plans (citing the Supplement al Proposal at 78 FR at 62518) is not adequate because the plans are not enforceable , as FIP requirements must be, and because the EPA does not state what percentage of total NO x reductions NGS must achieve annuall y. The commenter contended that the TWG Alternative is nothing more th an illegal self-regulation (citing Envtl. Def. Ctr. v. EPA, 344 F.3d 832, 855-56 (9th Cir. 2003)).

The commenter (0373) stated that TWG Altern ative A is built around the premise that some amount of capacity at NGS will be retired in 2019. According to the commenter, EPA assumed in its analysis that if all three units continued to operate, with a reduction in total combined capacity, that two

units would install SCR and that those two units would operate at full capacity, with a third unit operating at partial capacity with only LNB/SOFA. The commenter believes that while that is one possibility, nothing guarantees or requires the owners of NGS to c hoose that outcome, and the owners of NGS could shift capacity among the th ree units as they see fit under th e terms of the alternative. The

commenter contended that this subs tantial uncertainty means that it is impossible to know precisely when and by how much emissions will be reduced at any of the three NGS units under Alternative A.

The commenter (0373) asserted that TWG Altern ative B is more open-ended than Alternative A in that it only requires that the three units meet a 2009-2029 NO x emissions sub-cap, along with the

overall 2009-2044 NO x Cap. According to the commenter, EPA proposed two scenarios to consider under Alternative B; in one scenario the units all install SCR earlier, and thereafter meet a NO x emission

332 See 78 FR 62513 (October 22, 2013) and references therein.Page 200

EPA Responses to Comments: Navajo Gene rating Station Final Rule | July 28, 2014 limit of 0.07 lb/MMBtu, and in the ot her, the units all in stall SCR later and thereafter meet a NO x limit

of 0.055 lb/MMBtu. The commenter stated that thes e two options are by no m eans the only possible or even likely outcomes under th e open-ended Alternative B, asserting th at there are an infinite number of ways the NGS owners could choose to meet thes e limits, involving some combination of reduced capacity and/or pollution contro ls at various different dates (citing the Miller/Sahu report).

The Hopi Tribe (0134) indicated that it has seriou s concerns with the pr oposed TWG Alternative for several reasons, including because the TWG Altern ative does not specify th e technology, i.e., either SCR or an equivalent that will be used to achieve the same level of NO x reductions as the BART proposal. In the commenter’s opini on, the TWG Alternative is ambi guous because both scenarios are vague and do not include the same level of assurance that the NO x reductions will be the same as under the BART proposal. Also, because under the propos ed TWG Alternative the extended time NGS would be permitted to operate without SCR (or equivale nt alternative) the co mmenter believes the TWG alternative jeopardizes th e goal of the CAA and the purpose of this regulation.

Response:

EPA disagrees with the assertions that the TWG Alternative is vague and unenforceable. EPA acknowledges that the TWG Alternativ e is complex. This complexity is a result of th e role future ownership outcomes and regulatory requirements stemming from lease and coal contract negotiations will have in determining the most reasonable comp liance options in the future. For example, LADWP and NV Energy, who together own nearly one-third of the generating capacity at NGS, intend to divest their ownership share of NGS prior to the end of the current lease term. If LADWP and NV Energy divest by retiring their interests in NGS, the most logical operational outcome would be closure of one of the three units at NGS. If, instead, LADWP and NV Energy choose to divest by selling to an outside party (i.e., a party that is not curr ently an owner of NGS), then the most logical business outcome is no longer closure of one unit. Instead, the operator of NGS must take steps to ensu re the necessary emission reductions to maintain compliance with the applicable NO x emission caps over 2009-2029 and 2009- 2044. In addition to future decisions that are ye t to be made by LADWP and NV Energy, under the terms of the renewed site lease for NGS, the Nava jo Nation has the option to purchase up to a 170 MW ownership interest in NGS. This represents anothe r future ownership possibility that will affect the

determination of the most reasonable compliance option.

Contrary to the assertions by the commenter, EPA included proposed regul atory language in our Supplemental Proposal that provided specific an d enforceable timelines for achieving emission

reductions under the TWG Alternative. The proposed language under 40 CFR §49.5513(j)(3)(i), “Operating Scenarios to Comply with 2009-2044 NO x Cap,” defines the time frames and requirements under TWG Alternatives A1, A2, A3, and B, all of which must be implemented in a manner that ensures

total NO x emissions over 2009-2044 remain below the 2009-2044 NO x Cap. Specifically, §49.5513(j)(3)(i)(A) defines Alternative A1, that specifies the following requirements: (1) by December 31, 2019, the owner/operator shall permanently cease operation of one coal-fired unit and (2) by December 31, 2030, the owner/opera tor shall comply with a NO x emission limit of 0.07 lb/MMBtu on each of the two remaining coal-fired units. Alterna tive A1 is the simplest of the possible operating

scenarios under the TWG Alternat ive and §49.5513(j)(3)(ii)(A) specifies that Alternative A1 applies under three potential future ownership possibilities.

TWG Alternative A2 is defined in §49.5513(j)(3 )(i)(B), requiring (1) by December 31, 2019, the owner/operator shall permanently cease operation of one coal-fired unit, and (2) by December 31, 2019, the owner/operator may elect to in crease net generating capacity of the remaining two coal-fired units byPage 201

EPA Responses to Comments: Navajo Gene rating Station Final Rule | July 28, 2014 a combined total of no more than 189 MW. The act ual increase in net generating capacity shall be limited to the sum of 19 MW and the ownership interest, in net MW capacity of up to 170 MW, purchased by the Navajo Nation by December 31, 2019. The owner/operator shall ensure that any increase in the net generating capacity is in compliance with all pre-construction permitting requirements, as applicable, and (3) by December 31, 2030, the owner/operator shall comply with a NO x emission limit of 0.07 lb/MMBtu on each of the two remaining coal-fired units. The future ownership possibilities that would tri gger Alternative A2 are defi ned in §49.5513(j) (3)(ii)(B).

TWG Alternative A3 is defined in §49.5513(j)(3 )(i)(C), requiring (1) by December 31, 2019, the owner/operator shall reduce net generating capac ity of NGS by no less than 561 MW. The actual reduction in net generating capacity of NGS shall be determined by the difference between 731 MW and the ownership interest, in net MW capacity of up to 170 MW, purchased by the Navajo Nation by December 31, 2019, and (2) by December 31, 2030, th e owner/operator shall comply with a NO x emission limit of 0.07 lb/MMBtu on two units. The fu ture ownership possibili ties that would trigger

Alternative A2 are define d in §49.5513(j)(3)(ii)(C).

TWG Alternative B is defined in §49.5513(j)(3)(i) (D), requiring that in addition to the 2009-

2044 NO x Cap, the owner/operato r shall ensure complia nce with the 2009-2029 NO x Cap. The 2009-

2044 NO x Cap is defined in §49.5513(j)(2)(ii) as no more than 494,899 tons of NO x , and the 2009-2029

NO x Cap is defined in §49.5513(j)(2)(i) as no more than 416,865 tons of NO x . The 2009-2029 NO x Cap is based on closure of one unit by December 31, 2019 and the 2009-2044 NO x Cap is based on compliance with the BART emission limit of 0.055 lb/MMB tu within five years of the final rule. The future ownership possibilities that would trigger Alternative B are defined in §49.5513(j)(3)(ii)(D). As described in §49.5513(j)(4)(iv), if TW G Alternative B is triggered, the owner/operator must submit

annual Emission Reduction Plans that contains the anticipated year-by-year emissions to ensure compliance with the 2009-2029 and 2009-2044 NO x Caps.

The commenter asserts that under the scenario of reduced capacity (three units remain open, i.e., TWG Alternative A3), EPA ignored other possible out comes and simplistically assumed that two units would continue to operate at full capacity with SCR and the unit whose operation is curtailed would operate only with LNB/SOFA. The commenter asserts that there is no guarantee that the operator will choose to comply with TWG Altern ative A3 in this manner. Alt hough this specific arrangement under TWG Alternative A3 is not required, EPA disagrees that nothing compels the operator to comply with this operating scenario in a manner that reduces emissions comparably with the assumption that two units would operate at fu ll capacity with SCR and the unit that is curtailed would operate with

LNB/SOFA. EPA notes that under TW G Alternative A3, as well as a ll other TWG Alternatives, the owner/operator must operate the units at NGS so that total emissions remain below the 2009-2044 NO x Cap (as well as the 2009-2029 NO x Cap under Alternative B). Thus, a lthough flexibility exists for the owner/operator to shift capacity between the three units in differe nt ways, under §49.5513(j)(3)(i)(C), the actual strategy the owner/opera tor uses under TWG Alternative A3 must still comply with the 2009-

2044 NO x Cap and the timeframes required for reduc ing capacity and meeting the 0.07 lb/MMBtu

emission limit on two units. EPA notes that if the operator, for example, chose to curtail all three units by a total of 561 MW equally, and comply with a limit of 0.07 lb/MMBtu on two units and 0.24 lb/MMBtu on one unit, total emissions over 2009-2044 would not comply with the 2009-2044 NO x Cap. 333 Thus, the operator would be prohibited from ope rating in this manner and would need to, for

333 See tab titled “TWG A3” in the document titled “2014_0311 Better than BART Alternatives for Final Rule.xlsx” in the

docket for the rule at EPA-R09-OAR-2013-0009. We also note that in our Supplemental Proposa l, EPA mistakenly expected emissions under TWG A2 to be identical to TWG A3. This scenario would be possible if, under TWG A3, the operator ofPage 202

EPA Responses to Comments: Navajo Gene rating Station Final Rule | July 28, 2014 example, significantly curtail operations to reduce emissions further, or risk violating the FIP. As noted in our Supplemental Proposal, EPA estimated total NO x emissions over 2009-2044 for TWG Alternatives A1, A2, and A3 to provide assurance that the owner/ operator could reasonably meet the

2009-2044 NO x Cap under the specific terms of those alternatives. EPA does not need to determine that all operating possibilities that are consistent with the requirements of TWG A lternative A1, A2, and A3

would also meet the 2009-2044 NO x Cap. The regulatory requirements EPA proposed for the TWG Alternatives provide specific dates on which the owner/operator must close a unit, curtail operations,

and meet emission limits. While there is some flex ibility in how emissions might be curtailed under

TWG Alternative A3, the 2009-2044 NO x Cap ensures that the operator does not implement a strategy that results in substantially more emissions than would be achieved by inst alling SCR on the two units that are operated at full capacity and curtailing operations on the unit that was not retrofit with SCR.

The commenter asserts that TWG Alternative B is more open-ended than TWG Alternative A and that there are an infinite number of ways the operator could comply with the 2009-2029 and 2009-

2044 NO x Caps. The commenter further states that the two possibilities EP A considered in our Supplemental Proposal are not likely to be the outc omes under TWG Alternative B. EPA agrees that TWG Alternative B is more open-en ded than TWG Alternative A. However, EPA disagrees with the sentiment that TWG Alternative B is so open-ended th at it would not be enforcea ble or that it would not

result in emission reductions at NGS. We note that the 2009-2029 NO x Cap was calculated based on the

closure of one unit with no additional increase in capacity (i.e., equivalent to emissions under TWG Alternative A1). Thus, the operator cannot maintain the status quo (ope ration of all thr ee units at full capacity at a limit of 0.24 lb/ MMBtu) and meet the 2009-2029 NO x Cap. We also note that the 2009-

2044 NO x Cap was calculated based on compliance with 0.05 5 lb/MMBtu within five years of the final

rule. The difference between the 2009-2044 NO x Cap and the 2009-2029 NO x Cap is small (494,899 tons – 416,865 tons =78,034 tons), and when dist ributed over the fifteen year period (2030-2044), requires significant emission reductions that would come in the form of new NO x controls, significant curtailment, or earlier retirement than 2044. While inst allation of new NO x controls would reduce NO x , possibilities that involve earlier re tirement or significant curtailmen t would also reduce emissions of other pollutants emitted at NGS. Although TWG Alterna tive B is not specific in how the emission reductions must be achieved, the ra nge of possible operating choices ar e substantially constrained by the requirement to comply with the 2009-2029 and 2009-2044 NO x Caps. The commenter further notes that the Emission Reductions Plans required under TWG Alte rnative B are not, but must be, enforceable. EPA agrees with the commenter that the anticipated measures and year-by-year emissions outlined in

the Emission Reduction Plans are not enforceable. Howe ver, we note that the requirement to submit the Emission Reduction Plans, and the 2009-2029 and 2009-2044 NO x Caps are all enforceable under the FIP. Thus, while we will not require the operator to operate in the exact manne r it outlines in an annual Emission Reduction Plan, the operator must comply with the 2009-2029 and 2009-2044 NO x Caps that are consistent with meeting a limit of 0.055 lb/MMBtu at all three units in 2019 or closing a unit in 2019 and meeting a limit of 0.07 lb/MMBtu on two units in 2030.

One commenter (0367), in a footnot e in its comment letter, assert ed that EPA was incorrect to

claim that the TWG Alternative woul d absolve NGS of obligations related to a Reasonably Attributable

NGS elected to close a unit to achieve a reduction of 561 MW capacity, rather than achieving the reduction through

curtailment. In the curtailmen t scenario, emissions under TWG A3 would be higher than TWG A2. EPA evaluated potential emissions under TWG A3 in the updated spreadsheet (tab “TWG A3”) under three possible scenarios, and determined that only one of the three scenarios would maintain emissions below the 2009-2044 NO

x Cap. Therefore, although options under TWG A3 may seem broad, the operator of NGS must still opera te in a manner to ensure compliance with the 2009-2044 NO

x Cap. EPA did not receive comments speci fically noting that emissi ons under TWG A3 would likely not equal TWG A2.Page 203

EPA Responses to Comments: Navajo Gene rating Station Final Rule | July 28, 2014 Visibility Impairment (RAVI) fi nding that may be made for NGS. 334 EPA disagrees that we claimed that the TWG Alternative would absolve NGS of obliga tions related to RAVI. The commenter cited to footnote 21 in our Supplemental Proposal. 335 In that footnote, we ac knowledged that the TWG had intended their alternative to satisfy both the better than BART requirements of the RHR as well as any requirements of the RAVI program. However, in our Supplemental Proposal, EPA did not propose any action related to RAVI. In our footnote, we noted that there was no outstanding petition to certify impairment from NGS at any Class I area and outlined the process and requirements for triggering a

BART determination under R AVI. Specifically, we noted:

If NPS were to certify RAVI at Grand Canyon from NGS, EPA must determine whether visibility impairment at Grand Canyon is indeed attributable to NGS. If EPA were to make a positive attribution determination, then EPA would be required to conduct a BART determination for NGS. We note, however, that while the process for determining whether a given stationary source causes or contributes to RAVI or regional haze are different, the process for determining BART under both programs is essentially the same. In other words, a BART determination for RAVI would likely be the same as a BART determination for regional haze.

Although we stated that a BART determination under RAVI would likely be the same as a BART determination under regional haze (i.e., an analys is of the five factors listed in the CAA), EPA did not make any conclusions or absolve NGS of a ny obligations related to RAVI because there is currently no action before EPA to make an attribution finding related to NGS.

As discussed in our Supplemental Proposal, the National Parks Cons ervation Association (NPCA) petitioned the Department of the Interior on May 5, 2009, to certify that emissions of NO x and particulate matter cause visibility impairment at th e Grand Canyon National Park. This type of visibility impairment, reasonably attributable from a singl e stationary source, is known as Reasonably Attributable Visibility Impairme nt (RAVI). On January 20, 2011, NPCA filed a complaint in the United

States District Court for the Distri ct of Columbia conte nding that the Department of the Interior was unreasonably delaying making a finding of reasonable attribution from NGS. In a letter dated March 8, 2011 to NPCA, the National Park Service (NPS) dec lined to make such a finding based on EPA’s ongoing work related to a BART determination fo r NGS. On June 30, 2011, the Court dismissed the complaint holding the NPS letter refusing to make th e finding of reasonable attribution constituted denying the Petitioner’s re quest for a RAVI finding. 336 If NPS were to cer tify RAVI at Grand Canyon from NGS, EPA must determine whether visibility impairment at Grand Canyon is indeed reasonably attributable to NGS. If EPA were to make a pos itive attribution determination, then EPA would be required to conduct a BART determination for NGS.

Although there are no such petitions, EPA also not es that the action we are taking in this rulemaking is consistent with res ponding to a petition for reasonable attribution. In other words, EPA’s BART determination for purposes of 40 CFR 51.308(e) for regional haze visibility impairment requires the same analysis that we would undertake for a BART determination for r easonable attribution. The BART determinations under both provisions are the same.

334 See EarthJustice letter, page 10, footnote 25.

335 See Supplemental Proposal, 78 FR at 62513, footnote 21 (October 22, 2013).

336 The documents dated May 5, 2009, January 20, 2011, March 8, 2011, and June 30, 2011 are all available in the docket for

the rule in document number 0184 at EPA-R09-OAR-2013-0009.Page 204

EPA Responses to Comments: Navajo Gene rating Station Final Rule | July 28, 2014 One commenter raised concerns with the TWG Alternative because it does not specify the technology that must be installed. EPA notes that our proposed BART determination also does not specify what technology must be used. Our pr oposed BART determination and the regulatory requirements of the TWG Alternative all impose emission limits for NO x . The limits for the BART Benchmark (0.055 lb/MMBtu) and the TWG Alternat ive (0.07 lb/MMBtu) are based on what is achievable using a specific technology. Currently, bot h limits are achievable with SCR, but the operator may consider using newer technologies, if available, as long as each unit complies with its applicable emission limit by its compliance date. The commenter also noted that the flexible period for compliance under the TWG Alternative also jeopardizes the goal of the CAA and the purpos e of the Regional Haze

Rule. EPA notes that the under sec tion 169A of the CAA, Congress es tablished the goal of restoring visibility in Class I areas to natural conditions an d EPA’s RHR established a ta rget for achieving natural conditions by 2064. 337 EPA is finalizing the requirements of the TWG Alternative, which require, among other things, emission reductions in 2019 and in 2030. EPA is also adding as an enforceable requirement, the commitment from the Appendix B of the TWG Agreement for the owner/operator to cease conventional coal-fired electricity generation at NGS by 2044. EPA considers these time frames to be consistent with the stated goa l of section 169A of the CAA. EPA has addressed comments regarding consistency with EPA’s regulations, including the Regional Haze Rule and the Tribal Authority Rule, elsewhere in this response to co mments document (see section 8.5).

Comment: “Arbitrary” 2044 end date

One environmental advocacy group (0373) stated that the 2009-2044 period analyzed for the TWG Alternative is arbitrary because it is quite likely that one or more NGS units will operate beyond that time frame. According to the commenter, if they do so, the TWG Alternative, especially Alternative B, does not guarantee any emissions reductions beyond 2044. The commenter asserted that if NGS units continue to operate for even 3 additional years, until 2047, the TWG Alternativ e permits outcomes that will result in greater total NO x emissions than EPA’s NO x cap (citing the Mill er/Sahu report). The

commenter contended that the TWG Alternative does not require all units to re tire in 2044, and limiting analysis to this period is unsupported.

Response:

EPA disagrees with the comment that the 2044 end date for the NO x Cap is arbitrary. EPA used

2044 as the end date in our Febr uary 5, 2014 Proposed Rule in our calculations of the BART

Benchmark. EPA noted that we selected 2009-2044 as most appropriate because it includes the early

installation dates for LNB/SOFA an d extends until the anticipated 2044 te rmination date of the new site lease that was approved by the Navajo Nation. 338 The TWG Agreement provides further support for the end date of 2044 because, under the TWG Agreement signed by six entities incl uding the Navajo Nation and SRP, the operator of NGS, the NGS Co-Tenants shall cease their operation of conventional coalfired generating at NGS no later than December 2 2, 2044. At its election, consistent with the Lease Amendment, the Navajo Nation may continue plant operations at NGS after December 22, 2044 consistent with EPA approval. 339 EPA interprets this to mean that following the cessation of conventional coal-fired electricity generation at NGS in late 2044, th e Navajo Nation may seek to operate NGS after 2044 as a new source that would be subject to pre-construction permitting

337 40 CFR 51.308(d).

338 See Footnote 60 in the Proposed Rule, 78 FR at 8290 (February 5, 2013).

339 See Section VII.F of the TWG Agreement (page 14).Page 205

EPA Responses to Comments: Navajo Gene rating Station Final Rule | July 28, 2014 requirements (including BACT and a ssociated emission limits). However, EPA agrees that the 2044 end date, as included in the TWG Agreement, is not enfo rceable by EPA. Therefore, to make this end date federally-enforceable, EPA is adding it as a requir ement to the regulatory language in today’s final action. EPA is adding the following requirement to the regulatory language in the final rule:

By December 22, 2044, the owner/operator shall permanently cease operation of all coal-fired units at NGS. At its election, the Navajo Nation may continue plant operator at NGS after December 22, 2044, consistent with EPA approval under the New Source Review program.

EPA is adding the forgoing paragraph to the followi ng sections of the regula tory language: 40 CFR § 49.5513(j)(3)(i)(A), (B), (C), and (D).

Comment: Emissions under TWG Alternative

One environmental advocacy group (0373) stated that neither EPA nor TWG have provided a comprehensive technical analysis of the emissions and visibility outcomes that are possible under the

TWG Alternative. The commenter asserted that it is EPA’s responsibility to provide an administrative record that contains comprehens ive modeling and an alysis for any BART proposal, but EPA left this critical component of the al ternatives analysis undone.

The commenter (0373) indicated that it looked at a number of different permissible outcomes under TWG Alternative A and B, analyzed the resulting emi ssion reductions, and conducted independent analyses to assess the vi sibility outcomes of th ese possible scenarios. For Alternative A, the commenter analyzed the scenarios that EPA chose (w ith “corrections” as discussed elsewhere in this document) and three additional options that would be permissible under the third scenario in Alternative A. According to the commenter (citing the Miller/ Sahu report), these three additional outcomes would

all result in emissions that are greater than the emissions for the scenarios EPA considered under TWG

Alternative A – while emissions woul d be less than or equal to the NO x cap as calculated by EPA, emissions would not stay under the commenter’s corrected NO x cap and would not be close to BART

levels.

The commenter (0373) also analyzed and modeled four options that would be permissible under

Alternative B in addition to the two scenarios ad dressed by EPA. According to the commenter, these

additional outcomes all lead to cumulative emissions that are no greater than the NO x cap as calculated by EPA, but emissions do not stay under the commenter’s corrected NO x cap and are not close to BART

levels.

Response:

EPA disagrees with the comment that we have failed to provide a comprehensive technical analysis of the emissions and visibility outcomes th at are possible under the TW G Alternative. We also disagree with the assertion that our administrative record for this rulemaking is incomplete. EPA provided extensive analysis of th e potential BART scenarios, be ginning with our ANPR in August 2009. After considering the numerous comments on the ANP R and taking into account the unique and varied interests affecting NGS, EPA proposed to find that NO x BART for NGS is an emission limit of 0.055Page 206

EPA Responses to Comments: Navajo Gene rating Station Final Rule | July 28, 2014 lb/MMBtu which can be achieved by insta llation of SCR+LNB/SO FA on Units 1 – 3. 340 Our proposed

BART determination included one “better than BA RT” Alternative and a framework for evaluating other “better than BART” Alternatives. The TWG submitted the TWG Agreement. EPA evaluated Appendix B of the TWG Agreement and published a S upplemental Proposal that put forth our analysis of the alternative and pr oposed approval of requirements consiste nt with the TWG Agreement based on our analysis that it is “better than BART”. 341 The comment does not provide any facts or information to support the conclusory statements th at our analysis was not “comprehen sive” or that our administrative record is incomplete.

Instead, the comment relies on a report prepared by Miller and Sahu submitted with the comment. The Miller/Sahu Report cont ends that EPA’s evaluation of th e TWG Alternative is incorrect based on changing the central inpu ts underlying our calculations fo r the BART Benchmark and the TWG Alternative. The speci fic technical reasons that we disagree with the i nputs that the Miller/Sahu report changed (e.g. NO x emissions limit achievable with SCR, heat input values from baseline period, annual vs. 30-day emission rates) are explained in de tail in section 8.5 of this response to comments document. EPA notes that if we have provided a r easoned explanation for sele cting the technical inputs for our decision, our decision is entitled to deferen ce despite the commenter’s preference for some other set of inputs. As the 9 th Circuit stated in CACWD v. EPA :

The administrative record reveals th at EPA adequately considered the relevant factors in promulgating the Final Rule. [ footnote omitted ] Petitioners’ essential argument does not claim that EPA failed to consider the relevant factors, but instead contends that EPA erred in its

consideration of those fact ors. This court is not to substitute Petitioners’ judgment, or its own, for that of EPA, as long as the agency’s interpretation is reasonable. In fact, this is just the type of case in which the Supreme Court has stated that judi cial review should ‘be at its most deferential’ because the agency is ‘m aking predictions, within its area of special expertise, at the frontiers of science.’ [ citation omitted ]. 342

EPA provided a reasonable interpretation of its calculation of a cumulative NO x BART cap, and of the

emissions that will result from the TWG Alternative. Because the TWG Alternative will result in greater

NO x emissions reductions than BART, with the same geographic distri bution, EPA is properly approving the TWG Alternative as “better than BART.”

Table 2 in the Miller/Sahu report lists BART-1 as “EPA BART (No Corrections)”, showing a value of 379,152 tons of NO x emissions, 2009-2044 Cumulative. 343 The value that Miller/Sahu attributes as EPA’s value with “no corrections”, however, is nowhere traceable to EPA’s documents. EPA’s Proposed Rule calculates the NO x BART Benchmark to equal 358,974 tons of NO x emissions, plus the LNB/SOFA credit of 92,715 tons of NO x emissions. EPA made some corr ections to that value in its Supplemental Proposal, which incr eased the 2009-2044 cumulative NO x emissions cap to 377,015 tons

before the LNB/SOFA Credit. Th e Miller/Sahu report provides no e xplanation for the value of 379,152 tons that they nonetheless attribute to EPA with “ no corrections.” The Miller/Sahu report then makes

several “corrections” to reach a va lue of 280,554 tons of cumulative NO x emissions over 2009-2044. EPA has explained in detail why we disagree with each of the Miller/Sahu “corrections” in section 8.5

340 78 FR 8274 (February 5, 2013).

341 78 FR 62509 (October 22, 2013).

342 990 F.2d 1531, 1543 (9 th Cir. 1993)

343 Miller/Sahu Report, Table 2 at p. 7.Page 207

EPA Responses to Comments: Navajo Gene rating Station Final Rule | July 28, 2014 of this response to comments document and references therein. None of the “corrections” is changing an input to EPA’s calculation that is incorrect. EPA was correct in determining that SCR+LNB/SOFA operating at NGS could achieve a NO x emission rate of 0.055 lb/MMB tu. The operator of NGS, SRP, submitted comments contending that with LNB/ SOFA and SCR, it could only achieve at a NO x emission rate of 0.070 to 0.080 lb/MMBtu. EPA disagr ees with both commenters and continues to find

that a NO x emission rate of 0.055 lb/MMBtu is BART. For the reasons set forth in section 8.5, we also continue to disagree that our calcula tion of the BART Benchmark or the NO x Cap has relied on any incorrect inputs.

Because we disagree with the “corrections” and th e values presented in the Miller/Sahu report, we also disagree with the conclusions of Miller/Sa hu that the TWG Alternative fails to satisfy our requirements for demonstrating an a lternative is “better than BART.” The commenter cannot change the

fact that its alternative preferences on the inputs for calculati ng BART are just preferences by calling

them “corrections.”

Finally, the commenter presented the results of modeling. However, the conclusions the commenters draw from the modeling are based on th e values that the commenter has selected (i.e. calculated with its preferred inputs) – not the values determined by EPA as a scientific and technical matter to be appropriate. For all of the reasons that we disagree with the values calculated by the

commenter for the NO x BART Benchmark and the NO x Cap, we also disagree with the results of the modeling derived from those values.

Comment: Visibility modeling under the TWG Alternative

One environmental advocacy group (0373) pointed out that EPA did not conduct visibility modeling on any of the TWG Alterna tives. According to the commenter, visibility modeling is required

unless the distribution of emissions for a BART alternative is the sa me as it would be under BART, and

here that is not the case. The commenter stated that the TWG Alternative distri butes emissions over time very differently than BART: wh ile BART would require real a nd measurable reductions in NO x within 5 years due to the installation of SC R, the bulk of the reductions in th e TWG Alternative might not come until the end of the 2009-2044 period analyzed by EPA (as demonstrated by the additional scenarios analyzed by the commenter), resulting in decades of lost visibility at many of our most iconic national parks. The commenter added that th e pollutants reduced are also distri buted differently. According to the commenter, EPA indicated that if one or more units retire or reduce their capacity, emissions of SO 2 and PM will also be reduced, contributing to visibility improvements; the commenter believes that without modeling there is no way to know whethe r these reductions are significant.

The commenter (0373) stated that the additional analysis and modeling conducted by the

commenter reveal that the TWG A lternative is likely substantially worse than BART, depending on which of the nearly limitless options the owners elect to pursue (citing the Miller/Sahu report). According to the commenter, the results of the vi sibility modeling show that many of the possible outcomes under the TWG Alternative produce substant ially worse visibility outcomes than EPA’s NO x cap, even where the total emissions from an outcome remain below the NO x cap. The commenter further

asserted that all of the outcomes for the TWG A lternatives produce substantially worse visibility

outcomes than the commenter’s corrected BART. Th e commenter reproduced a table and graphs from the Miller/Sahu report that comp are outcomes under BART, the NO x cap, and a variety of scenarios

under the TWG Alternative. Accord ing to the commenter, the table and graphs show that while

cumulative emissions of these scenarios remain below EPA’s calculated NO x cap (but not thePage 208

EPA Responses to Comments: Navajo Gene rating Station Final Rule | July 28, 2014 commenter’s “corrected” NO x cap or the BART emissions calculated by the EPA or the commenter), visibility impacts measured in cumulative dv for many of the scenarios are worse than under EPA’s NO x cap and significantly worse than the commenter’s corrected BART.

The commenter (0373) believes that these resu lts illustrate the inadequacy of comparing

cumulative total emissions to assess whether an alte rnative is better than BART, and demonstrate that comprehensive visibility modeling is necessary before EPA may appr ove any BART alternative at NGS.

The commenter asserted that these results al so clearly show that strict controls on NO x emissions (i.e., SCR) are necessary because the reductions in SO 2 and PM from reduced capacity or retirement have little impact on visibility. The commenter stated th at its modeling and analysis show that the TWG Alternative allows for many decades of visibility impairment be fore any improvements are made, contrary to the requirements of the CAA.

Response:

EPA did not conduct visibility modeling as a basis for proposing to approve the TWG Alternative because EPA’s regulations provide that an alternative that re sults in the same distribution of emissions and greater emissions re ductions is “better than BART” a nd that no additional modeling is required. 40 CFR 51.308(e)(3). The co mment states that the TWG Altern ative does not comply with the regulations because it will result in different temporal distribution of emissions. In fact, the comment

admits that the “spatial” distribution of the emissions from BART and the TWG Alternative will be the

same.

EPA interprets the requirement of 40 CFR 51.308(e)(3) to require the same geographic

distribution of emissions. There is no requirement in EPA’s regul ations for a similar temporal distribution of emissions. See respon ses in section 8.5 of this documen t. EPA notes that Sierra Club

endorsed the substitution of an Oklahoma SIP revi sion for EPA’s FIP despite the SIP revision having a different temporal distribution of emissions than the FIP it was replacing. The Sierra Club comment

letter in that instance stated: “The FIP scenario may have somewhat gr eater benefits for several years,

but the SIP Revision better achiev es the overall goals of the Regional Haze program because emissions from both units will be completely eliminated by 2016.” 344

In summary, there is no requirement in 40 CF R 51.308(e)(3) for EPA to demonstrate that the

NO x emissions reductions from the TWG Alternative have a similar temporal distribution as BART. EPA interpreted this requirement to require a sim ilar geographic distribution when we promulgated the rule in 2005, 70 FR at 39136-38. The requirements for vi sibility impairing pollutants to be reduced over time are contained in 40 CFR 51.308(d). EPA notes also that the regional haze program has a long time horizon and is a long term pr ogram with a horizon in 2064.

Although visibility modeling is not required for the TWG Alternative because it has the same geographic distribution of emission reductions as BART and because EPA disagrees with the way the visibility analyses were presen ted in the Miller/Sahu Report, EPA conducted our own analysis of the anticipated visibility impacts of the TWG Alternative. The Miller /Sahu Report compared anticipated visibility impacts in 2020 and th e sum of all visibility impact s over 2009-2044 (cumulative visibility impacts), for the Class I areas th at EPA properly modeled that are within 300 km of NGS, as well as Class I areas within 520 km. The Miller/Sahu Report labeled as “BART-1” a scenario that is not consistent with EPA’s proposals and labeled as “CAP -1” the scenario that is consistent with EPA’s

344 Letter from Elena Saxonhouse, Sierra Club to Guy D onaldson, EPA, Region 6, dated September 20, 2013.Page 209

EPA Responses to Comments: Navajo Gene rating Station Final Rule | July 28, 2014 proposals. Thus, the logical comparison between th e commenter’s BART-1 and the TWG Alternative scenarios when viewing graphics in the report is misleading because BART-1 does not represent EPA’s position on BART for NGS. 345 The proper comparison, which was not intuitive, would have been

between the TWG Alternatives and the commenter’s CAP-1 scenario. Exhib it 2 to the Miller/Sahu Report shows that the TWG Altern ative scenarios consid ered by the commenters, that meet the 2009- 2044 and 2009-2029 NOx Caps (as applicable) generally re sult in lower or comparable visibility impacts as EPA’s proposals for NGS (i.e., co mmenter’s depiction of CAP-1). 346

In addition, the commenters opin e that EPA’s graphs, included as supporting information for our Supplemental Proposal, were misleading because we labeled a line as “BART” that was actually the

NO x Cap (i.e., it incorporated the LNB/SOFA credit) . As discussed elsewhere in this response to comments document, EPA was clear in our Supplem ental Proposal and supporti ng documentation, that the BART Benchmark, as computed in the Supplemen tal Proposal, included the LN B/SOFA credit, or in other words, it represented “5-year BART as if LNB not yet installed.” 347 EPA also explained and provided supporting calculations to show that the two methods used to compare BART and BART Alternatives in the Proposed Ru le and the Supplemental Proposal we re equivalent (see Supplemental Proposal and section 8.5 of this response to comments document). Figure 3 of the Miller/Sahu Report reproduces EPA’s graph along with the line that the commenter asserts is more appropriate (i.e., BART accounting for the early and voluntar y installation of LNB/SOFA in 2009-2011). The commenter opines

that the difference between their BART line and EPA’s BART line is dramatic. 348 Because the difference between the two lines represents whet her or not the LNB/SOFA credit is included, the dramatic difference cited by the commenter actually illustrates the dramatic effect on cumulative emissions of the early and voluntary installati on of LNB/SOFA in 2009-2011. Although the commenter (0367) attempts to portray the insta llation of LNB/SOFA as not truly “ early” or truly “voluntary” or an attempt to “game the system,” 349 Figure 3 of the Miller/Sahu Report illustrates that the decision by the operator of NGS to install LNB/SOFA on one unit per year over 2009-2011 did result in a dramatic change in the overall cumulative emissions profile fo r NGS. As stated elsewhere in this response to comments document, these emission reductions, as a factual matter, were early, real, and voluntary. Although some commenters opine that NGS should not be rewarded for “obfus cation and delay,” we note that Figure 3 of the Miller /Sahu Report graphically shows th e benefit in emission reductions achieved by the operator’s decision to install LNB/ SOFA early. Although EPA does not consider our Proposed Rule and Supplemental Proposal to be a “rew ard” (as NGS will still be required to close one unit or curtail operations by an e quivalent amount and comply with emission limits achievable with SCR+LNB/SOFA), we also do not cons ider it appropriate to penalize NGS for their early and voluntary

345 See Exhibit 2 to Miller/Sahu Report, titled “ex. 2 Visib and Emis for NGS.xlsx” in the docket for the rulemaking at EPAR09-OAR-2013-0009-03 70. Because the commenters degreed with our proposal to give credit to NGS for the early and voluntary installation of LNB/SOFA, the scenario labeled “BART-1” excludes that credit and is therefore not consistent with EPA’s proposals. The Miller/Sahu Report al so included a scenario labeled “BART-9” that applies additional corrections as recommended by the commenter.

346 Id . See “dV profiles” tab. The commenter depicted TWG-1, 2, 12, 13, and 14 with cumulative visibility impacts over 2009-2044 that are clearly lower than CAP-1. The commenter’s depictions of TWG-8, 9, and 11 with cumulative visibilityimpacts that appear to be slightly higher than CAP-1. Further inspection of the tab indicates that the difference between CAP1 and TWG-8, 9, and 11 is less than 5 percent, or a cumulative difference of 30 deciviews, distributed over 11 Class I areas over 35 years. The commenters did not show visibility result s for scenarios that did not meet the 2009-2044 NOx Cap.

347 See, e.g., tab titled “TWG A1” in the document titled “Suppl emental Better than BART Alte rnatives.xlsx” in document

number 0191 in the docket for this rule at EPA-R09-OAR-2013-0009.

348 See pages 14 and 15 of the Miller/Sahu Report.

349 See, e.g., footnote 27 on pages 11-12 and page 22 of the EarthJustice LetterPage 210

EPA Responses to Comments: Navajo Gene rating Station Final Rule | July 28, 2014 reductions by setting an emissions ca p that takes credit for those emi ssion reductions (i.e., includes those reductions in the pre-BART period).

EPA conducted visibility modeling to compare TW G Alternatives A1, A2, and A3 in 2019 and 2030 against our proposed BART determination. 350 As indicated by commenters, other possibilities exist beyond the scenarios for the TWG Alternatives we c onsidered explicitly in our Supplemental Proposal.

EPA has stated elsewhere that we need not consid er potential emissions under all possible scenarios in setting the NO x Cap, but must verify that NGS can reasona bly be expected to comply with 2009-2044

NO x Cap under the various constraints imposed under th e TWG Alternatives (i.e., closure, curtailment, and a secondary 2009-2029 NO x cap). However, EPA explored two other possibilities under TWG Alternative A3 beyond the one shown in Table 14 below. Those two possibilities included reducing capacity on all three units equally or reducing capacity on two units and installing SCR on the two units that operate at reduced capacity. 351 EPA did not include those two additional possibilities under TWG Alternative A3 in our visibility modeling analysis because those scenarios do not reduce emissions sufficiently to meet the 2009-2044 NO x Cap.

Table 14: EPA’s Additional Modeling for Final Rule to Compare TWG Alternatives with BART

Scenario Year Description NO
x Emission Rate (lb/hour) SO 2 Emission Rate (lb/hour)
TWG A1 in 2019 Close one unit. LNB/SOFA on two units. 4,309 1,064

TWG A1 in 2030 Close one unit. SCR+LNB/SOFA on two units (0.07 lb/MMBtu). 1,257 1,064

TWG A2 in 2019 Close one unit. Incr ease capacity on two remaining units by 189 MW total.

LNB/SOFA on those two units. 4,851 1,198

TWG A2 in 2030 Close one unit. Incr ease capacity on two remaining units by 189 MW total. SCR+LNB/SOFA on those two units (0.07 lb/MMBtu). 1,415 1,198

TWG A3 in 2019 Reduce capacity on Unit 2 by 561 MW.

LNB/SOFA on three units. 4,878 1,197

TWG A3 in 2030 Reduce capacity on Unit 2 by 561 MW. SCR+LNB/SOFA on Units 1 and 3 (0.07 lb/MMBtu). 1,827 1,197

BART 2019 + SCR+LNB/SOFA on three units (0.055 lb/MMBtu). 1,506 1,591

Our visibility modeling of the TWG Alte rnatives compared to our proposed BART determination shows that, as expected, during the approximate 10-year period between 2019 and 2030, the visibility impacts of NGS under the TWG Alternatives are higher th an the visibility impacts of NGS under BART (see Figure 8). Specifically, our modeli ng results indicate an anticipated cumulative visibility impact of NGS at all 11 Class I areas as a result of the TWG Alternatives A1-A3 ranging from

350 See document titled “2014_0307 Emission Spreadsheets for NGS modeling for Final Rule.xlsx” in the docket for this rulemaking. EPA also remodeled the BART scenario using a rate when operating with SCR of 0.055 lb/MMBtu. The modeling EPA included with our proposed rule had modeled SCR at 0.05 lb/MMBtu.

351 Id . See tab labeled “Read Me”.Page 211

EPA Responses to Comments: Navajo Gene rating Station Final Rule | July 28, 2014 23 to 26 deciviews and a cumulative visibility impact of NGS as a result of BART of 13 deciviews. 352
The commenter’s depictions of BART and the TWG Alternatives are generall y consistent with our modeling. The commenters results show cumulative visib ility impacts, at all 11 Class I areas (i.e., their depictions of areas within 300 km), in 2020 from the TWG Alternatives to range from 20 to 28

deciviews and from BART to be 12 deciviews. 353

After 2030, when NGS achieves additional emissi on reductions through compliance with a limit of 0.07 lb/MMBtu on two units, our modeling indicates that the vi sibility impacts under the TWG Alternatives are comparable to or lower than visibi lity impacts under BART (see Figure 8). Specifically, our results indicate an anticipated cu mulative visibility impact of NGS at all 11 Class I areas as a result

of the TWG Alternatives A1-A3 ra nging from 10 to 13 deciviews and a cumulative visibility impact of

NGS as a result of BART of 13 deciviews. 354 The commenter’s depictions of the TWG Alternatives are generally consistent with our mode ling, showing cumulative visibility impacts at all 11 Class I areas, that range from 9 to 14 deciviews. 355 The commenter included other possible TWG scenarios that result in higher visibility impacts of NGS in 2030 a nd beyond, e.g., the TWG-11, representing two SCR and no unit curtailment or closure, at 17 deciviews; TWG-12 and TWG- 13, representing closure of more

than one unit with no installation of controls. However, despite the comm enter’s depictions of visibility impacts in any given year, the commenter also show ed that the cumulative visibility impacts across all

11 Class I areas over 2009-2044 under their TWG s cenarios (e.g., TWG-11 through TWG-14) were comparable to BART (i.e., the case the commenter labeled as CAP-1) 356

.

As stated previously, although the commenter also included emissi on and visibility scenarios for what they believe should be BART (i.e., depicted as BART-1 and BART-9), EPA disagrees that our proposed rules, including a credit for the early and voluntary instal lation of LNB/SOFA and emission limits and timing of compliance are not appropria te for NGS. Therefore, although the commenter compares the TWG Alternatives agai nst depictions of its preferred BA RT determination to suggest that

the TWG Alternative is not better than BART, EPA disagrees that those comparisons are appropriate.

Figure 8 below also shows anticipated visibil ity impacts of NGS after 2044. As noted elsewhere in this response to comments document, EPA is in cluding as part of the TWG Alternative, in the regulatory language in the final rule, a provision consistent with the TWG Agreement that the owner/operator of NGS permanently cease conventi onal coal-fired generation by the end of 2044. Thus, under the TWG Alternative, the visibili ty impact of NGS is expected to be reduced or close to zero in

2045 and thereafter. At its electi on, consistent with the Lease Amendment, the Navajo Nation may continue plant operations at NGS after December 22, 2044 consistent with EPA approval. 357 Thus, the Navajo Nation may seek to operate NGS after 2044, however, EPA expects that operation of NGS after the owner/operator ceases conventional coal-fired ge neration would involve substantial modification to NGS and NGS would be required to meet all app licable regulatory and permitting requirements in existence at that time. Under BART, there would be no commitment or enforceable requirement for the

352 See tab titled “Visibility Summary”, row 26, columns AT to AW, in the document titled “2014_0311 Better than BART Alternatives_Revised for Final Rule.xlsx” in the docket for this rulemaking.

353 See tab titled “dV Profiles”, cells, e.g., Y15, BA15, BH15, BO 15, and CC15 in Exhibit 2 to the Miller/Sahu report titled

“ex. 2 Visib and Emis for NGS.xlsx” at EPA-R09-OAR-2013-0009-0370.

354 See tab titled “Visibility Summary”, row 37, columns AT to AW in document titled “2014_0311 Better than BART Alternatives_Revised for Final Rule.xlsx” in the docket for this rulemaking.

355 See tab titled “dV Profiles”, e.g., row 26, columns BA BH, BO, and BV in Exhibit 2 to the Miller/Sahu report titled “ex. 2

Visib and Emis for NGS.xlsx” at EPA-R09-OAR-2013-0009-0370.

356 See tab titled “TWG Emissions Graphs”, two graphs titled “Cum ulative NOx Emissions, Tons, 2009-2044” in Exhibit 2 to the Miller/Sahu report titled “ex. 2 Visib and Emis for NGS.xlsx” at EPA-R09-OAR-2013-0009-0370.

357 See Section VII.F of the TWG Agreement (page 14).Page 212

EPA Responses to Comments: Navajo Gene rating Station Final Rule | July 28, 2014 owner/operator to cease conventional coal fired generation after 2044, ther efore, visibility impacts of

NGS at all 11 Class I areas would be expected to continue in 2045 and thereafter. We note that under the TWG Agreement, although the Navajo Nation has the option to continue operation of NGS after 2044, the Navajo Nation would be required to unde rgo New Source Review and control technology requirements as they exist in the future. Thirty year s from now, as technologi es advance, BACT for NO x (and other criteria pollutant s and greenhouse gas emissions) would likel y require an emissions profile at NGS that is even more stringent than BART levels established in the present day.

Although visibility modeling of the TWG Alternativ e was not required under the RHR, EPA conducted visibility modeling in response to resu lts submitted by the commenter in the Miller/Sahu Report. Our results indicate, as e xpected, that there is a period of time (over 2019 to 2030) when BART

is better than the TWG Alterna tive, but after 2030, and especially after 2044, the TWG Alternative reduces the visibility impact of NGS on 11 Class I areas to a greater extent than BART. We also note that Sierra Club recently endorsed the substitution of an Oklahoma SIP revision for EPA’s FIP despite the SIP revision having a period of higher emission s than the FIP it was replacing. The Sierra Club

comment letter in that instance stated: “The FIP scenario may have somewhat greater benefits for several years, but the SIP Revision better achieve s the overall goals of the Regional Haze program because emissions from both units will be completely eliminated by 2026.” 358 Therefore, although not required, EPA conducted additional visibility modeling and the results rebut the commenter’s assertions

that the TWG Alternative is not “better than BART.”

358 Letter from Elena Saxonhouse, Sierra Club to Guy D onaldson, EPA, Region 6, dated September 20, 2013.Page213EPA Responses to Comments: Navajo Generating Station Final Rule | July 28, 2014Figure 8: Comparison of Anticipated Visibility Impact over 2001-2044 underBART Benchmark and TWG Alternative0102030405060 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030 2031 2032 2033 2034 2035 2036 2037 2038 2039 2040 2041 2042 2043 2044

Cumulative decivew impact of NGS on 11 Class I AreasYearBARTTWGA1TWGA2TWGA3TWGisbetterthanBARTBARTisbetterthanTWGTWGisbetterthanBARTLNB/SOFACreditTWGStep 3:Twounitsmeet0.07lb/MMBtu limitTWGStep 2:Closure orCurtailmentTWGStep 1:EarlyinstallofLNB/SOFABART:Threeunitsmeet0.055lb/MMBtulimitPage 214

EPA Responses to Comments: Navajo Gene rating Station Final Rule | July 28, 2014 Comment: TWG Alternative is not “better than BART”

One environmental advocacy group (0373) stated that EPA has not demonstrated and cannot

demonstrate that the BART alternatives will ach ieve greater reasonable progress toward natural visibility conditions than BART. The commenter believes that ther e are multiple flaws with EPA’s proposals for each alternative, including improper use of a total NO x cap concept that fails to make greater reasonable progress than BART , use of an improper emissions ba seline that artificially expands the cap for the alternatives only, and a lack of modeling by EPA (or TWG) to demonstrate reduced visibility impacts from the alternatives (see secti on 8.5 and in preceding comments in this section). The

commenter asserted that EPA must re ject the TWG Alternative (and Altern ative 1) as inadequate as it is

not “better than BART.”

One environmental group (0254) expressed skep ticism regarding the timeframe for the TWG Alternative, which the commenter believes is too long, and the uncertainty provided by Alternative B.

The commenter asserted that NGS should be cl eaned up much sooner than 2030, regardless of the plant’s ownership arrangements. The commenter added that it is encouraging to see DOI’s commitment to a clean energy transition in the TWG Agreement, but the commenter contended that greater and more

enforceable commitments should be made in order to transition our energy usage toward clean energy projects like wind and solar.

A public interest advocacy group (0356) also strongly objected to the TWG Alternative based on

assertions that it does no t benefit the environment, cultural resour ces and public health; it only bails out SRP, BOR, and Arizona utilities from having to find investors to take over California and Nevada’s share of NGS. In addition, the commenter does not support the TWG Alternative because the Hopi Tribe was not part of the TWG. The commenter does no t support the EPA’s BART Alternative, which would allow early installation credit for low-NO x burners and SCR to be installed per unit between 2021 and 2023. The commenter opined that that the owners of NGS should not be rewa rded for obfuscation and delay, and pointed to EPA’s task to promulgate w ithout unreasonable delay FI P provisions needed to protect air quality. The commenter added that the US BOR has several hydro-electric power projects in the West that can be used to produce power for CAP and tribes with water settlement agreements.

A public interest advocacy group (0 413) also objected to the TWG Alternativ e, which it believes is missing the economic and environmental justice inte rest of tribal communities that are affected by pollution caused by coal burning at NGS. The commente r said that the TWG appears to be a standard that is “better than BART,” but it cannot compete with the origin al BART standard proposed by EPA

that will achieve a NO x reduction of 84 percent imme diately after installing S CR within 5 years of the rule. One individual (0025/0130) asserted the TWG A lternative will have a disp roportionately high and

adverse human health or environmental effects on minority or low-income populations because it

decreases the level of environm ental protection. The commenter urged EPA to reject the TWG

Alternative as it will create more bronchiolitis, which harms small children and minorities, and retain the

NO x limit of 0.055 lb/MMBtu.

The Hopi Tribe (0134) also expr essed concern that EPA did not assess the potential economic impacts of the TWG Alternative to the Hopi Trib e. The commenter opined that EPA recognized the significance of NGS to the Hopi Tribe in its analys is under Factor 2 concludi ng EPA did not anticipate adverse impacts on the Navajo Nati on and Hopi Tribe based on the analysis that SCR would not force

NGS to close. Because the TWG A lternative includes closure of at least one unit in 2019, and EPA didPage 215

EPA Responses to Comments: Navajo Gene rating Station Final Rule | July 28, 2014 not address the potential economic im pacts of partial closure of NGS on the Hopi Tribe, the Agency has not complied with its own BART regulations and guidance. The comme nter noted the trust responsibility of the United States to the Hopi Tribe. The Hopi Trib e further noted that in the event capacity is reduced at NGS under the Supplemental Proposal, the amount of coal and water purchases would decrease leading to a decrease in income to the tribe from the sale of these. Also, the commenter stated that the Supplemental Proposal is not as eff ective in improving air quality and visibility for the Hopi reservation. Extending the timeframe during wh ich NGS can continue to operate without SCR or an equivalent technology would cause a cont inued air quality burde n on the Hopi Tribe.

One commenter (0420) submitted copies of a pe tition signed by more than 70 members of the Navajo Nation favoring implementation of NO x controls at NGS within 5 years and opposing the TWG

Alternative.

Response:

EPA recognizes that numerous commenters do not support the TWG Alternative. EPA disagrees

with the assertion that the TWG A lternative is not “bette r than BART.” EPA has responded elsewhere in

this document to comments related to the NO x Cap, the BART Benchmark, the credit for the early and voluntary installation of LNB/SOFA, the flexible tim eframe for compliance, the enforceability of the TWG Alternatives, and whether visi bility modeling is required for BA RT Alternatives in cases where the geographic distribution of emissions under BART a nd the Alternative are the same (see section 8.5).

To the extent that royalties paid to the Hopi Tribe depend on the amount of coal mined at the Kayenta Mine, and to the extent that the amount of water purchased depends on the amount of coal mined, EPA recognizes that the TWG Alternative, which includes closure of one unit at NGS or equivalent curtailment of operation, may change the royalties and other payments related to coal and water that are paid to the Hopi Tribe. Although EPA evaluated potenti al economic impacts of the BART options in our five-factor analysis, we disagree that we must also conduct similar analyses for

Alternatives to BART. The BART Guidelines do not provide any gui dance on the evaluation of BART Alternatives beyond the discussion in the Preambles for the 1999 and 2005 rules, and the Regional Haze Rule does not require an analysis of economic im pacts of BART Alternativ es. EPA’s evaluation of potential impacts to tribes in our five-factor analysis under BART is consistent with the BART Guidelines and was also used to inform our gove rnment-to-government consultation with tribes.

EPA disagrees with the assertion that the TWG Al ternative decreases the level of environmental protection and will have disproporti onately high and adverse human health or environmental effects on minority or low-income populations. EPA notes th at the BART determination requires emission

reductions of NO x and does not permit or authorize new or greater pollutant emissions. Thus, if EPA took no action to finalize a BART determination, em issions from NGS would remain at current levels. In EPA’s final action, EPA is se tting a BART Benchmark for NO x emissions over 2009-2044 based on an emission limit of 0.055 lb/MMBtu and requiring the operator of NGS to implement the TWG Alternative and reduce emissions in a phased manner to ensure total emission reductions remain below the BART Benchmark. Although the tim eframe for the TWG A lternative (new redu ctions in 2019 and 2030) is longer than the timeframe for BART (in 2019), we note that BART would only reduce

emissions of NO x , whereas the TWG Alternative, in 2019, would also reduce emissions of SO 2 , PM,

CO 2 , and hazardous air pollutants as a result of the cl osure of one unit (or equi valent curtailment). In addition, the regional haze program as envisioned by Congress and implemented in regulations by EPA is a long-term program spanning until 2064. Retirement of NGS as a conventional coal fired power plantPage 216

EPA Responses to Comments: Navajo Gene rating Station Final Rule | July 28, 2014 in 2044 will eliminate the visibility impairing pollu tants 20 years before 2064. This result will also eliminate pollutants that affect human health and have other environmental effects. For the reasons described above, and elsewhere in this response to comments documen t, EPA disagrees that the TWG

Alternative is not better than BART.

Comment: Support for some changes EPA made to the TWG Alternative in the Supplemental Proposal

The TWG (0313) and one of the owners of NGS ( 0348) noted that there we re several differences between Appendix B of the TWG Agreement and EPA’s Supplemental Proposal. The commenters expressed support for some of thes e as discussed below. Differences with which the commenters expressed concern are discu ssed later in this section.

The commenters (0313, 0348) agreed with the me thodology that EPA used to calculate the 2009-

2044 NO x cap of 494,899 tons. The commenters noted that EP A adjusted this cap to provide credit for the early installation of LNB/SO FA up until the summer of 2014 base d on the expectation that the

BART FIP for NGS will not be final and effective until then.

The commenters (0313, 0348) noted that in the Supplemental Proposal, EPA proposed to require the NGS operator to notify EPA by December 1, 2019, of “ the final ownership outcome and the resulting applicable operating sc enario that it will implement ” (citing 78 FR 62518). The commenters presume that EPA intended to require a notification of which TWG Alternative (A or B) applies based on the ownership of the plant at that time, and the commenter supports this requirement. However, the commenters requested that EPA not re fer to the “operating scenario” in this context be cause the same term is used in the description of the Emission Reduction Plan requi red under Alternative B, and the NGS operator would not be in a position in 2019 to id entify the operating scenar io within the Emission Reduction Plan that it will implement if Alternative B applies. The commenters therefore requested that the same language be used in the preamble as in 40 CFR 49.5513(j)(4)(i) to cl arify this requirement: “ No later than December 1, 2019, the owner/operator must notify EPA of the applicable Alternative for ensuring compliance with the 2009–2044 NO x Cap. ”

The commenters (0313, 0348) support the additional requ irement to report annual heat input, although this information is alrea dy reported through the Acid Rain Pr ogram. However, the commenters requested that additional time be pr ovided to ensure that the data s ubmitted in the annual report is consistent with the data that the NGS operator submits to the Clean Air Markets Database (CAMD), in the annual emission inventory, and in the greenho use gas (GHG) report required by 40 CFR part 98,

which are not due until March 31st. To address this issue, the commenters suggested the following changes to 40 CFR 49.5513(j)(4)(ii):

Beginning January 31, in 2015 and annually thereafter until the earlier of December 22,

2044 or the date on which the owne r/operator ceases conventional coal fired generation at NGS, the owner/operator shall submit to the Regional Administrator, a report summarizing the annual heat input, the annual emissions of sulfur dioxide, carbon dioxide, and annual and cumulative emissions of NO x from NGS for the previous full calendar year. The owner/operator shall make th is report available to the public, either through a link on its Web site or directly on its Web site. The report shall be made available within 30 days of the submitta l deadline associated with the annual emissions inventory required by the NGS Title V Operating Permit

.Page 217

EPA Responses to Comments: Navajo Gene rating Station Final Rule | July 28, 2014 Response:

EPA recognizes that the TWG supports some of the differences between EPA’s Supplemental Proposal of the TWG Alternative and the Appe ndix B to the TWG Agreement, including EPA’s

revisions to the 2009-2044 NO x Cap and the requirement to report a nnual heat input. EPA agrees that it is reasonable to require the timeframe for the repo rting requirements under BART to generally be more consistent with reporting requirements under the Part 71 operating permit. Therefore, EPA is making the change to the regulatory language recommended by the commenter. The commenter also noted that language in the preamble to our Supplemental Proposal related to notification to EPA by December 1, 2019 was inconsistent with the langu age in the proposed re gulatory requirements in our Supplemental Proposal. The commenter recommended that the preamble language match the language in the regulatory requirements. EPA agrees th is is appropriate and will make ef forts to ensure that the language in the preamble to the final rule is consistent with the ac tual language in the re gulatory requirements of

the final rule.

Comment: Suggested addition to §§ 49.5513(j)(4)(iv )(A) and (B)

The TWG (0313) and one of the owners of NGS (0348) requested that EPA clarify the scope and content of the title V permit revision that is necessar y to incorporate elements of the BART alternative by adding the language below from the TWG Altern ative to the end of proposed §49.5513(j)(4)(iv)(B), and similar language to proposed §49.5513(j)(4)(iv)(A):

The requirement to establish th e Implementation Plan [Emission Reduction Plan] by December 31, 2029, a nd annually thereafter, and the requirement to operate in accordance with one of the operating scenarios outlined in the plan, shall be incorporated into the NGS Title V Operating Permit as federally enforceable permit conditions. In addition, the NGS Title V Operating Permit shall incorporate practically enforceable limits of
0.24 lb/MMBtu, on a 30 Day Rolling Average basis, for each Unit equipped with LNB/SOFA, or 0.07 lb/MMBtu, on a 30 Day Rolling Average basis, for each Unit equipped with SCR, as federally enforceable permit conditions to achieve the emission reductions required under the Implementation Plan [Emission Reduction Plan]. The Implementation Plan [Emission Reduction Plan] will ensure that the Reasonable Progress Alternative to BART achieves great er reasonable progress than the Proposed BART Rule by providing a plan for managing NO x emissions to

less than the 2009 2044 NO x Cap.

The CAP operator (0250/0343) noted only that the Supplemental Proposal is unclear with regard to which compliance requirements are needed in the title V permit revi sions, without suggesting specific rule language.

Response:

EPA did not include the language from Appendix B to the TWG Agr eement related to the title V (part 71) operating permit in the regulatory language in our S upplemental Proposal because the title VPage 218

EPA Responses to Comments: Navajo Gene rating Station Final Rule | July 28, 2014 (part 71) regulations require that the operating permits include all a pplicable requirements, which, for NGS, would include the permit limits that exist in its PSD permit (i.e ., the limit of 0.24 lb/MMBtu when operating with LNB/SOFA) as well as the final requirements in this FIP (e.g., the limit of 0.07 lb/MMBtu on two units in 2030). Therefore, a specifi c requirement in the FIP that directs the operating permit to incorporate applicable requirements is not necessary. However, to the extent the TWG requests consistency with the language in the TWG Altern ative, although EPA considers it unnecessary, EPA will amend §49.5513(j)(4)(iii) to read:

No later than December 31, 2020, the owner/operator shall submit an application to revise its existing Pa rt 71 Operating Permit to incorporate the requirements and emission limits of the applicable Alternative to BART under paragraph (j)(3). The Part 71 Operating Permit for NGS shall incorporate practically en forceable limits for NO x of 0.24 lb/MMBtu, on a

30 day rolling average basis, for each Unit equipped with LNB/SOFA, and 0.07 lb/MMBtu, on a rolling average basis of 30 boiler operating days, for each Unit equipped with SCR, as federally enforceable permit

conditions.

EPA will also add in the followi ng provision as §49.5513(j)(4)(iv)(C):

The requirement to establish a nnual Emission Reduction Plans by December 31, 2019 shall be incorporated into the Part 71 Operating Permit for NGS as federally enforceable permit conditions. In addition, the Part 71 Operating Permit for NGS shall incorporate practically

enforceable limits for NO x of 0.24 lb/MMBtu, on a 30 Day Rolling Average basis, for each Unit equipped with LNB/SOFA, or 0.07 lb/MMBtu, on a rolling average basis of 30 boiler operating days, for each Unit equipped with SCR, as federally enforceable permit conditions to

achieve the emission reductions re quired under the Emission Reduction

Plan. The Emission Reduction Plan will ensure that the Alternative to BART achieves greater reasonable progress than the Proposed BART Rule by providing a plan for managing NO x emissions to less than the

2009 2044 NO x Cap.

We further note that in the proposed regulat ory language in our Supplemental Proposal, EPA inadvertently did not specify an averaging period for the emission limits under the TWG Alternative Operating Scenarios (§49.5513(j)(3)). Th erefore, EPA is adding to the re gulatory language that emission limits apply over a rolling average of 30 boiler operating days, to 40 CFR §49.5513(j)(3), (j)(3)(i)(A)(2), (j)(3)(i)(B)(3), and (j)(3)(i)(C)(2).

Comment: Another suggested addition to §§49.5513(j)(4)(iv)(A) and (B)

The TWG (0313), the CAP operator (0250/0343), and one of the owners of NGS (0348) stated that the EPA Supplemental Proposal specified a short term NO x limit of 0.07 lb/MMBtu on a 30 day rolling average basis for TWG Alternative A, but did not specify a limit for Alternative B as was included in the TWG Agreement. Two of the co mmenters (0313, 0348) requested that EPA add thePage 219

EPA Responses to Comments: Navajo Gene rating Station Final Rule | July 28, 2014 following language, which is taken from the TWG Agreement, to proposed §§49.5513(j)(4)(iv)(B) and 49.5513(j)(4)(iv)(A) to a ddress this issue:

The NGS Title V Operating Permit shall incorporate practically
enforceable limits of 0.24 lb/MMBtu, on a 30 Day Rolling Average basis, for each Unit equipped with LNB/SOFA, or 0.07 lb/MMBtu, on a 30 Day Rolling Average basis, for each Unit equipped with SCR, as federally enforceable permit conditions to achie ve the emission reductions required under the Implementation Plan.

Without suggesting specific language, the othe r commenter (0250/0343) an ticipated that this discrepancy is an oversight that can be reconciled in the final rule.

Response:

EPA agrees that if the owners of NGS elect to in stall SCR in order to comply with the applicable

NO x Caps under TWG Alternative B, th en it is useful to specify the emission limit that would apply. Although the limit of 0.07 lb/MMBtu (on a rolling av erage basis of 30 boiler operating days) would apply under TWG Alternatives A1, A 2, A3, or B, EPA notes that the operator of NGS may need to operate SCR at an emission rate that is lower than 0.07 lb/MMBtu depending on their compliance with

the NO x Cap, but the addition of this provi sion would prohibit emissions of NO x , when operating with SCR, to exceed 0.07 lb/MMBtu (on a rolling average basis of 30 boiler operating days). EPA will amend §49.5513(j)(4)(iii) to read:

No later than December 31, 2020, the owner/operator shall submit an application to revise its existing Pa rt 71 Operating Permit to incorporate the requirements and emission limits of the applicable Alternative to BART under paragraph (j)(3). The Part 71 Operating Permit for NGS shall incorporate practically en forceable limits for NO x of 0.24 lb/MMBtu, on a

30 day rolling average basis, for each Unit equipped with LNB/SOFA, and 0.07 lb/MMBtu, on a rolling average basis of 30 boiler operating days, for each Unit equipped with SCR, as federally enforceable permit

conditions.

EPA will also add in the followi ng provision as §49.5513(j)(4)(iv)(C):

The requirement to establish a nnual Emission Reduction Plan by December 31, 2019 shall be incorporated into the Part 71 Operating Permit for NGS as federally enforceable permit conditions. In addition, the Part 71 Operating Permit for NGS shall incorporate practically

enforceable limits for NO x of 0.24 lb/MMBtu, on a 30 Day Rolling Average basis, for each Unit equipped with LNB/SOFA, or 0.07 lb/MMBtu, on a rolling average basis of 30 boiler operating days, for each Unit equipped with SCR, as federally enforceable permit conditions to

achieve the emission reductions re quired under the Emission Reduction

Plan. The Emission Reduction Plan will ensure that the Alternative to BART achieves greater reasonable progress than the Proposed BARTPage 220

EPA Responses to Comments: Navajo Gene rating Station Final Rule | July 28, 2014 Rule by providing a plan for managing NO x emissions to less than the

2009 2044 NO x Cap.

Comment: Omitted ownership outcome

The TWG (0313) and one of the owners of NGS (0348) stated that EPA described the NGS ownership outcomes in a manner that is different fr om the scenarios outlined in the TWG Agreement.

The commenters indicated that the ownership outcomes appear to be consistent, except that one potential outcome was omitted the scenario in which one or more of the existing NGS Participants (LADWP or NV Energy) remain in NGS, which would tr igger Alternative B. To address this issue, the commenters suggested the addi tion of the following language to proposed §49.5513(j)(3)(ii)(D):

Alternative B shall apply if, by December 31, 2019, either of the Departing Participants sells its ownership interests to a Part y that is not an Existing Participant , or if either of the Departing Participants remains in NGS

.

Response:

EPA agrees that we inadvertently omitted, fr om §49.5513(j)(3)(ii)(D), th e potential scenario where one or both of the Departing Participants (i.e., LADWP or NV Energy) do not exit NGS as expected. EPA is updating the language to incorpor ate the additional omitted ownership possibility.

Comment: Describe details of TWG Agreement more fu lly in the preamble to the final rule

The TWG (0313) and one environmental advocac y group (0395) said that EPA only briefly described the elements of the TWG Agreement in the October 2013 Supplemental Proposal (citing to a paragraph at 78 FR 62512 of the pr oposed rule). The environmental a dvocacy group (0395) asserted that this limited paragraph does not accurately present th e provisions of the Agreement as it relates to clean energy economic development for affected Tribes, th e rigorous development and consideration of clean energy alternatives to NGS, mitigation of CO 2 emissions, and local Benefit Fund to address concerns of the public in the vicinity of NGS and the Kaye nta-Black Mesa Mine Co mplex. Should EPA proceed

with this alternative in the final rule, the commenter requested that the Agency fully describe the key elements in the preamble to the final rule by in cluding the following and by elaborating on these elements and pulling text from the Agreement itself:

EPA recognizes that the TWG Agreem ent has significant environmental, clean energy and economic benefits beyond those provisions included in Appendix B. These benefits incl ude commitments for clean energy economic development for the affected Tribes, a Local Benefit Fund for community improvement projects within 100 miles of NGS or the Kayenta Mine, provisions for potential carbon di oxide emission reductions at NGS, a commitment to identify funding for and ensure completion of the Phase 2 study by the National Renewable Ener gy Laboratory to analyze a full range of clean energy options for NGS, and commitments by the Department of the Interior to reduce or offset the carbon dioxide emissions

associated with its Central Arizona Project pumping loads by 3 percent perPage 221

EPA Responses to Comments: Navajo Gene rating Station Final Rule | July 28, 2014 year, pursuant to a specifically described carbon dioxide emission accounting mechanism, and to faci litate the development of 26,975,000 MWh of clean energy.

The TWG (0313) requested that the same language be included in the preamble to the final rule, with the

addition of an additional sentence:

Nothing in this final rule shall preclude the NGS Participants from seeking to obtain greenhouse gas emission reduction credits, or similar

commodities associated with activ ities committed to in the TWG Agreement, under any Federal or Stat e law or policy to the extent permitted under such applicable law or policy.

One of the owners of NGS (0348) also requested th at this statement regarding the ability of NGS Participants to seek GHG emission reduction cr edits, which based on the language in the TWG Agreement, be included in the preamble to the fina l rule. The commenter stated that this provision is very important to the NGS Participants. Without suggesting specific language, the CAP operator (0250/0343) similarly noted that this aspect of the TWG Agreement was not incorporated or recognized in the Supplemental Proposal. This commenter anticipates that this discrepancy is an oversight that can

be reconciled in the final rule.

Response:

EPA acknowledged that the TWG Agreement cont ains additional provisions that will be

beneficial to the tribes in the area and to th e environment. However, EPA does not consider it appropriate to provide a detailed discussion of these additional provisi ons of the TWG Agreement in our final rule. EPA was not a signatory to the TWG Agreement and did not participate in the TWG Stakeholder group. The TWG Agreement speaks for itsel f and the participants and signatories are the appropriate entities to interpret the provisions of the TWG Agreement. EPA is acting as a regulatory agency because we are finding that it is necessary or appropriate to regulate NO x emissions from NGS to improve visibility at the GCNP a nd 10 other Class I areas. EPA is not exercising authority other than that set forth in CAA section 169A. Therefore, EPA is declining to provide any further discussion of the non-regional haze provisions of the TWG Agreement.

The comment also requests EPA to add certain language to the final ru le. Specifically, the comment asks EPA to add: “Nothing in this fina l rule shall preclude the NGS Participants from seeking to obtain greenhouse gas emission reduc tion credits, or similar commodities associated with activities committed to in the TWG Agreemen t, under any Federal or State law or policy to the extent permitted under such applicable law or policy.”

EPA is also declining to add the requeste d language to our final rule. EPA is not exercising any authority in th is action other than implemen ting CAA section 169A, through our

discretion in the TAR. It would be inappropriate in this actio n to take any position on the future use or regulation of GHG emission reductions or “similar commodities.”

Comment: TWG Alternative should satisfy Reasonable Progress requirementsPage 222

EPA Responses to Comments: Navajo Gene rating Station Final Rule | July 28, 2014 One of the owners of NGS (0348) stated that Appendix B to the TWG Agreement was designed to meet not only BART requirements, but also re asonable progress requireme nts applicable to NGS through 2044. The commenter believes that because of the importance of NGS to the owners, tribal entities, and the State of Arizona, it is important to have as much regulatory certainty as possible. Accordingly, the commenter requested that EPA dete rmine that the TWG Alternative satisfies both the BART and reasonable progress requirements of the CAA through 2044. Specifically, the commenter requested that EPA add the following langua ge to the preamble in the final rule:

Given that the TWG Alternative contains NO x reduction measures that will be implemented over a long term period through 2044, and the factors

that will be considered in a future reasonable progress determination, as prescribed in section 169A(g)(1) of the Clean Air Act (CAA), are similar to the BART factors in section 169A( g)(2) of the CAA, the outcome of a future review under the reasonable pr ogress requirements of the CAA is expected to conclude that the TWG Alternative satisfies both BART and the reasonable progress requirements of the CAA with respect to NGS through 2044.

The CAP operator (0250/0343) si milarly noted that the Suppleme ntal Proposal does not specify

that the TWG Alternative satisf ies reasonable progress requirement, as was intended by the TWG. Without suggesting specific language, the commenter an ticipated that this disc repancy is an oversight

that can be reconciled in the final rule.

Response:

EPA has not made any finding pursuant to 40 CFR 49.11( a) that it is necessa ry or appropriate at this time to promulgate a FIP to meet the reas onable progress requirements for States under the RHR. The requirement for States to develop reasonable progress goals are establis hed in 40 CFR 51.308(d)(1). But there is no requirement for that provision of the RHR to apply to the Navajo Nation until EPA makes a determination that it is necessary or appropr iate for EPA to promulgate a FIP for that provision. In any event, the reasonable progre ss goals would not be directly appl icable to NGS without substantial further analysis. Because it is premature to determine that it is necessary or a ppropriate to promulgate such a FIP, it is also premature to determine that it is not necessary or appr opriate. Therefore, EPA is declining to take the action requested in the comments.

Comment: Delete requirement to keep records of maintenance

One of the owners of NGS (0348) requested that EPA delete the requirement in proposed §49.5513(j)(7)(vi) that the NGS operator keep records of all major maintenance ac tivities that occur at NGS. According to the commenter, the existing t itle V permit requirement that the NGS operator operate and maintain emission control equipment in a manner that is consistent with good engineering practices to keep emissions at or below applicable emissions limitations provides sufficient assurance that emission control equipment will be operated and maintained in accordance with best practices.

Response:Page 223

EPA Responses to Comments: Navajo Gene rating Station Final Rule | July 28, 2014 EPA is deleting the requirement proposed under §49.5513(j)(7)(vi) to requi re the operator of NGS to keep records of all major maintenance activ ities at NGS because records of major maintenance

activities are not needed for demonstrati ng compliance with the 2009-2044 or 2009-2029 NO x Caps or other provisions of the TWG Alternative.

Comment: 0.07 lb/MMBtu limit

One of the owners of NGS (0348) noted th at the TWG Agreement would establish a NO x emission limit of 0.07 lb/MMBtu for any unit equipped with SCR. The commenter pointed out that this proposed emission limit is at the lower end of the range recommended in S&L’ s analysis of achievable emission limits at NGS (discussed in section 8.1 of this document), which could require the NGS Participants to limit operation of th e units in certain modes, unless fu ture technology advances allow the limit to be achievable over a broader range of operating conditions. The commenter views the 0.07

lb/MMBtu limit not as BART but as a “better than BART” limit in th at it would result in greater NO x emission reductions than the February 2013 Proposal.

Response:

EPA agrees that the commenter correctly noted that 0.07 lb/MMBtu is the lower end of the range recommended by S&L in their analysis. EPA also agr ees that 0.07 lb/MMBtu is not BART (as discussed in section 8.1, EPA is determining that BART for NGS is a limit of 0.055 lb /MMBtu). However, EPA disagrees with the commenter that 0.07 lb/MMBtu, by itself, is better th an BART. Although the TWG

Alternative results in more emission reductions th an would have been achieved under BART, we note that 0.07 lb/MMBtu is not, in itself , a better than BART limit because the TWG Alternative includes two other components besides compliance with a limit of 0.07 lb/MMBtu in 2030, namely, closure of one unit (or equivalent curt ailment) in 2019, and a credit for the early and voluntar y installation of

LNB/SOFA over 2009-2011.

Comment: Update past agreements

One individual (0415) recomme nded that past agreements cited in the TWG proposal, including the Navajo-Hopi Rehabilitation Act of 1950, the Colorado River Ba sin Project Act of 1968, Central Arizona Project, and the federal government’s “uni que and continuing trust relationship with and responsibility to Indian tribes,” be revisited and revised to reflect current knowledge and data on fossil

fuels.

Response:

EPA included a summary of this comment in th is response to comments document, however, we note that this comment is not directly related to our Proposed Rule or our Supplemental Proposal and is beyond the scope of our rulemaking; therefore, we are not providing a re sponse to this comment.

Comment: Concern that the Hopi Tribe and other af fected parties were excluded from TWGPage 224

EPA Responses to Comments: Navajo Gene rating Station Final Rule | July 28, 2014 Five individuals (0240, 0245, 0281, 0394, 0399) were frustrated that all affected parties, particularly the Hopi Tribe, were not included in the development of the TWG Alternative. One commenter (0281) noted that the H opi Tribe has a Generating Perfor mance Agreement with SRP that

should have mandated their involvement. The White Mountain Apache Tribe ( 0440) also notes that it was not party to the TWG Agreement. Another comme nter (0394) noted that a presidential Executive Order, initially issued by President Clinton and then reissued by President Obama, requires that all tribal nations be consulted on these types of regulations, and asserted that EPA and DOI violated this order. In addition, this commenter noted that several lette rs by then-Chairman of the Hopi Tribe Leroy Shingoitewa were sent to DOI co mplaining about the lack of cons ultation. Another commenter (0399) argued that the TWG proposal did not consider gr assroots statements, including comments from Black Mesa, and discouraged their partic ipation in TWG public forums, inst ead conducting meetings with only industry stakeholders who had financial interests.

One of the individuals (0281) stated that EP A did not give the public enough time to comment on the TWG Agreement before issuing a Supplementa l Proposal and, on that basis, demanded that EPA withdraw its approval of the TWG Alternative. The commenter added that the TWG Agreement is based on the assumption that the Hopi w ill support the Kayenta Mine Lease extension when it expires in 2025, but the Hopi have yet to discuss the extension w ith the 12 Hopi independent villages, which is a requirement in the Hopi Constitution. Furthermore, the commenter noted that the TWG Agreement ignores the requirement of comple ting an EIS and ROD before the NGS site lease with the Navajo Nation expires in 2019. The commenter argued that the DOI-BOR’s approval of the TWG Agreement without the fulfillment of these requirements violates the NEPA process. The commenter added that in 1989, the Hopi Tribe rejected the Dr aft Kayenta Mine-Black Mesa Mine EIS in its entirety, and implied that the decision to accept the TWG proposal could compromise EPA’s final decision.

Response:

EPA recognizes that there are aff ected tribes and other stakeholders that were not included in the Technical Work Group. We note that EPA was not involved in the formation of the TWG and not involved in any meetings or discussions of the TWG. 359 As discussed in section 10.0 of this response to comments document, consistent with Executive Order 13175: Consultation and Coordination with Indian Tribal Governments, EPA consulted with tr ibes early and regularly during the development of this rulemaking for NGS. We note that the Region al Administrator for Region 9 spoke with thenChairman LeRoy Shingoitewa on September 13, 2013 about the TWG Agreement and notified elected leaders or legal counsel for five tribes when EPA signed the Supplemental Proposal. EPA also held individual and joint consultation meetings with tribal leaders in Phoeni x, Arizona on December 9-10,

2013.

EPA disagrees that we did not provide the publ ic enough time to review the TWG Agreement. EPA posted the TWG Agreement to the public dock et on July 26, 2013, the same day it was submitted

to EPA. 360 EPA reviewed the TWG Agreement and on September 25, 2013, signed a Supplemental Proposal that put forth the TWG Alte rnative, consistent with Appendix B of the TWG Agreement, as an

additional “better than BART ” Alternative for p ublic comment, and on October 22, 2013, the

359 At the request of the TWG, at their kick-off meeting, EPA pres ented a summary of our Proposed Rule and framework for BART Alternatives. The presentation at the TWG kick-off meeting was generally the same presentation EPA provided to

other stakeholders. See document 0033 in the docket for the rule at EPA-R09-OAR-2013-0009.

360 See document number 0122 in the docket for this rulemaking, at EPA-R09-OAR-2013-0009-0122.Page 225

EPA Responses to Comments: Navajo Gene rating Station Final Rule | July 28, 2014 Supplemental Proposal published in the Federal Register

. 361 The public had nearly six months to review the TWG Agreement as submitted to EPA and approximately three months to review EPA’s Supplemental Proposal. EPA also notes that EPA’s rulemaking is not subject to NEPA.

Comment: EPA’s relationship to the TWG is confusing

The White Mountain Apache Tribe (0440) opined th at although EPA stated it was not involved in the TWG, EPA was a signatory of the “Joint Fe deral Agency Statement Regarding Navajo Generating Station”, the scope of which incl udes numerous elements that refe rence EPA’s commitments, along with the Departments of the Interior and Energy in re lation to NGS. The commenter suggests that EPA was involved in a legal triangul ation with the TWG signatories and that such action is an extra-jurisdictional exercise by EPA, to which the Tribe does not consen t. The commenter conclude s that the Tribe cannot

consider the TWG Alternative unle ss its published form is changed by EPA to fully disentangle the proposal from the signatory group and all non-BART terms of the TWG Agreement, and additional public comment is thereafter allowed.

Response:

The Joint Federal Agency Statement Regarding Na vajo Generating Station is a document that is completely separate from the TWG. The Joint Federal Agency Statement was signed by the

Administrator of EPA and the Secretaries of the Interior and Energy on January 4, 2013. That document acknowledged that each of the three federal agencies have an intere st in the operation of NGS. In contrast, EPA was not part of the TWG. EPA did not participate in any of th e substantive discussions and negotiations of the TWG. Two representatives of EPA attended the beginning of the first meeting of the TWG but only to present an summary of EPA’s February 5, 2013 Proposed Rule. 362 After the initial meeting, EPA was not involved with the TW G until the TWG Alternative was completed.

The TWG was not primarily composed of fede ral agencies. The TWG had two environmental organizations (Environmental Defense Fund and West ern Resource Advocates), two Tribes (Gila River Indian Community and the Navajo Nation), two Ariz ona utilities (Central Ar izona Water Conservation District and Salt River Project) a nd the Department of the Interior . Appendix B of the TWG Agreement contains provisions rela ting to BART but there were several ot her provisions of the TWG Agreement that are beyond the scope of BART and are no t part of EPA’s rulemaking in this action.

EPA disagrees with the commenter that EPA is “e ntangled” with the TWG. As stated previously, EPA did not participate in the TWG and was not involved in the TWG Ag reement. EPA does not

understand what the commenter mean s in stating that the White Mountain Apache Tribe “cannot

consider the TWG Alternative unle ss its published form is changed by EPA to fully disentangle the proposal from the signatory group and all non-BART Agreement terms.” EPA does not agree that any further public comment is warranted.

361 See document number 0182 and 0186 in the docket for this rulemaking, at EPA-R09-OAR-2013-0009-0182 and EPAR09-OAR-2013-0009-0186.

362 At the request of the TWG, at their kick-off meeting, EPA pres ented a summary of our Proposed Rule and framework for BART Alternatives. The presentation at the TWG kick-off meeting was generally the same presentation EPA provided to

other stakeholders. See document 0033 in the docket for the rule at EPA-R09-OAR-2013-0009.Page 226

EPA Responses to Comments: Navajo Gene rating Station Final Rule | July 28, 2014 

## 10.0 Other Comments

Comment: General Support

In general, many individuals (0020, 0021, 0038, 0040, 0047, 0064, 0067, 0083, 0091, 0112, 0113, 0123, 0248, 0177, 0179, 0180, 0181, 0197, 0202, 0215, 0216, 0217, 0235, 0241, 0242, 0261, 0264.3, 0264.5, 0264.6, 0275, 0281, 0290, 0327, 0331, 0344, 0361, 0364, 0396, 0415), support EPA’s effort to reduce emissions from NGS. Many of these commenters asked for the most stringent regulations and urged EPA not to delay BART control requirements. Tw o commenters (0047, 0064) applauded EPA’s effort to fully engage the stakehol ders in the rulemaking process, which they believe shows a willingness to work together on the part of Agency. Another commenter (0112) compared EPA’s efforts to John F. Kennedy’s determination to send a man to the moon, and believes that regional haze regulations will force the energy industry to inve st in better technology more quickly than if they were not asked to do so. Similarly, one commente r (0264.3) quoted President Roosevelt who stated “Leave it as it is,” referring to the Grand Canyon.

Four individuals (0164, 0179, 0344, 0415) asserted th at opponents to the pr oposal take advantage of Arizona’s air quality for their own personal gain s (e.g., maximum bonuses and salaries). One of these commenters (0415) stated that Peabody’s Se ptember 2013 quarterly report references 3 rd quarter revenues of $1.80 billion and a new $2.85 billion credit facility, and argue d that this report proves that Peabody can make the financial inve stments needed to NGS to reduce emissions. Two other individuals (0204, 0331) stated that facility ow ners can afford propaganda to promote their views and tribal

communities cannot. Another individua l (0215) urged EPA to mount its own campaign addressing the

health and environmental risks to Arizonans if the state of Arizona does not address air pollution.

Six individuals (0177, 0197, 0235, 0264.6, 0327, 0341) w ould prefer that NGS be shut down completely. One individual (0149) ar gued that soot from coal-fired power plants like NGS contribute twice as much to global warming as non-soot formi ng power sources, and claimed that if these plants were located closer to major citi es, like Phoenix or Tucson, they woul d have retrofitted or shut down already.

Response:

EPA recognizes that numerous individuals supported our proposed BART determination for NGS and several individuals expressed their prefer ence that NGS close immedi ately or in the near future. EPA does not have authority under the RHR a nd the BART requirements of the CAA to require a facility to close. In recognition of the role NGS plays in the econom ies of the Navajo Nation and the Hopi Tribe, and in providing power to CAP, which serves numerous tribes located in Arizona, EPA is finalizing the TWG Alternative that requires greater NO x reductions than what would have been

otherwise achieved under BART in exchange for additional flexibility in the compliance timeframe to ensure continued operation of NGS and reduced impacts to tribes.

EPA recognizes that certain stakeholders may ha ve greater resources th an others to prepare comments. However, EPA provided a lengthy comment period and numerous opportunities to talk with representatives from EPA and su bmit comments orally or in wr iting. EPA notes that Peabody Energy operates the Kayenta Mine, but is no t the operator of NGS. Therefore, st atements made about the ability of Peabody Energy to make financial investments in NGS are not germane.Page 227

EPA Responses to Comments: Navajo Gene rating Station Final Rule | July 28, 2014 Comment: Disproportionate impacts to tribes

The Tonto Apache Tribe and the San Carlos Apache Tribe (0419) believe that both the original BART proposal and the proposed TWG Alternative are contrary to U.S. obligations and trust responsibilities to Indian Tribes under CAP and have dispropor tionate impacts on tribes with CAP contracts. The commenter expressed that environmen tal quality is of upmost importance to the tribes, but clean air is the responsibility of all citizens. Therefore, the commenters assert that because the United States owns 24.3 percent of NGS, the costs of compliance for that 24.3 percent share should be shared among all American people, who will benefit from cleaner air. The commenters urged EPA to develop an alternative regulat ion that does not place additi onal burden on Indian Tribes.

Response:

EPA agrees that our proposed BART determina tion and the TWG Alterna tive will impact tribes

with CAP water contracts. We note that the Joint Federal Agency Statement on NGS reflects the U.S. Government’s recognition of its resp onsibilities related to NGS and trus t responsibility to Indian tribes affected by NGS.

Although EPA is finalizing a BART Benchmar k for NGS, the regulatory requirements will include only the requirements and compliance tim eframes under the TWG Alternative as proposed in our Supplemental Proposal. As defined in our S upplemental Proposal, emission reductions at NGS would be achieved in phases, including closure of one unit or the equivalent in 2019, and compliance

with an emission limit achievable with SCR in 2030. We note that the closure of one unit was possible because of the planned divestment of LADW P and NV Energy from NGS by 2019. Because LADWP and NV Energy are unrelated to CAP, EPA does not e xpect substantial complian ce costs to be borne by Reclamation (and thus, tribes or other CAP water user s) due to the first phase of emission reductions at NGS in 2019. EPA further notes that the 2030 complia nce date for meeting an emission limit achievable with SCR on two units at NGS is approximately 16 y ears from the present day. As stated elsewhere in this response to comments document, the require ments under BART and the TWG Alternative are for meeting emission limits, rather than installing a particular technology. Thus, 16 years from now, although SCR will be capable of meeting the emission limit, other technologies or options may become available for the operator of NGS to more cost-effectively meet the NO x emission limit of 0.07

lb/MMBtu.

EPA agrees with the commenter’s statement that the Department of the In terior, Department of Energy, and EPA, in the 2013 Joint Statement on NGS, com mitted to work together with stakeholders to support implementation of BART requirements at NGS in a manner that reduces emissions while supporting longer-term goals th at include, among other things, minimizi ng impacts to tribal nations that benefit from NGS, and that this commitment incl uded, as an example action, seeking funding for the federal portion of air pol lution upgrades at NGS. 363 However, EPA notes that the commenter

mischaracterized the commitment made in th e TWG Agreement (in which EPA and DOE did not participate) related to the Recl amation Water Settlements Fund. The commenter stated that BOR would deposit $10 million into the Fund to a ssist tribes in transitioning away from reliance on NGS. The TWG

363 See document titled “2013_0104 Joint Federal Agency Statement on NGS” in document number 0005 in the docket for

this rule at EPA-R09-OAR-2013-0009.Page 228

EPA Responses to Comments: Navajo Gene rating Station Final Rule | July 28, 2014 Agreement actually states that the Department of th e Interior commitment to expend at least $10 million over 2020-2029 (a total of $100 million) for the purpose of providing financial assistance for the fixed

OM&R costs.

EPA recognized the potential impacts to tribes of our proposed BART determination and sought ways to provide flexibility and a framework for affect ed stakeholders to devel op alternative approaches

to BART. EPA has determined that the TWG Alte rnative achieves greater emission reductions than

would otherwise be achieved under our proposed BART determination, while providing additional time for compliance. This additional time allows th e DOI, DOE, and EPA time to work with tribal stakeholders to identify and implement strategies fo r achieving the goals outlined in the Joint Federal Agency Statement on NGS.

Comment: Conduct Impact Assessments

An environmental advocacy group (0395) said that one of the main concerns raised at the public hearings was the importance of addressing public health concerns related to the collection of industrial activities at NGS and Kayenta-Bl ack Mesa Mine Complex and prot ection of water resources. The commenter urged EPA to collaborate with other expert s and expert agencies to address these concerns, conduct a rigorous impact assessment, and take corrective action. The commenter stressed the importance of the Navajo aquifer and other water re sources of the Colorado Plateau. For example, under TWG Alternative A, one-thi rd the capacity at NGS would close in 2019. The commenter stressed that a transparent and inclusive process is essential for dete rmining solutions for wise stewardship of the water

that would continue to be used by the remaining coal units at NGS.

A public interest advocacy group (0 413) also asked that a health assessment be conducted to study the impacts of NGS pollution on the Navajo Nati on. The plant has been re leasing larg e quantities of pollution and toxic metals since 1974, putting the health and lives of Navajo and Hopi people in danger. The facility emits more than 16,000 tons per year of NO x according to EPA Air Markets Program Data, 13,000 pounds per year of hydrochloric acid (HCl), more than 19,000 pounds per year of hydrogen fluoride (HF) and more than 580 pounds of mercury, according to the EPA Toxic Release Inventory, and is one of the top 10 worst-emitting coal plants in the country.

Response:

EPA recognizes that NGS, togeth er with the Kayenta Mine, have environmental impacts that extend beyond regional haze and visibility impairment at Class I areas. EPA notes that the NGS site lease and other grants of rights-of -way associated with NGS and the Kayenta Mine are subject to NEPA. The Department of the Interior, with Bureau of R eclamation as lead Federal agency, is initiating the preparation of an Environmental Impact Statement (E IS) to cover these actions. EPA will have a role in reviewing the EIS for NEPA compliance and may become a cooperating agency.

Assessing human exposure and quantifying health benefits are outside the scope of the requirements of the Regional Haze Rule. EPA sets National Ambient Air Qu ality Standards (NAAQS) to establish levels of air quality that are protectiv e of public health, including the health of sensitive populations, for a number of polluta nts including particulate matter. Th ese sensitive populations include people with asthma, children, and the elderly. At this time the Navajo Nation is not identified as out ofPage 229

EPA Responses to Comments: Navajo Gene rating Station Final Rule | July 28, 2014 attainment with any of the NAAQS. However, EPA r ecognizes that there are si gnificant concerns about risk and exposure to air pollutants on the Navajo Nation.

Comment: Require recordkeeping for the life of the plant

One environmental advocacy group (0395) indicated that the current requirement to maintain records for 5 years is insufficient and inappropriate for the compliance schedule associated with NGS

and recommended that records be maintained from 2009 through the remaining operating life of the plant. It is essential to maintain transparency and enforceability for the final rule and requirements for NGS. The commenter urged the Agency to finalize a re quirement that will provid e the public the ability to participate and evaluate in real time the emissions performance and compliance activity of this major emitting facility.

Response:

EPA agrees that because the operator of NG S must ensure compliance with the 2009-2044 NO x Cap, the operator of NGS should also maintain reco rds for the life of the f acility to demonstrate compliance with the TWG Alternative. In the regulatory language in our Final Rule, EPA is amending §49.5513(j)(7) to require the owner or operator of each unit to maintain reco rds, as required under §49.5513(j)(7)(i) to (vi), until the earl ier of December 22, 2044 or the da te that conventional coal-fired operation of all units at NGS permanently ceases. As discussed elsewhere in this response to comments document, EPA is adding to the final rule the prov ision of the TWG Agreement that prohibits continued operation of conventional coal-f ired generation at NGS beyond December 22, 2044. If the Navajo Nation elects to continue plant operations at NGS , the Navajo Nation must obtain permits under the New Source Review or PSD programs.

Comment: Oppose Operation of NGS

One public interest advocacy group (0403) indica ted that it is opposed to the current and proposed operation at NGS and associated activitie s because it violates the SMCRA, CAA, Clean Water Act, UN Declaration of the Rights of Man, and customary law.

One individual (0025/0139) submitted legal opini ons to support their position that NGS does not have a Certificate of Environment Compatibility (CEC) from the Arizona Co rporation Commission. See 685, State of Arizona ex rel. Merrill v. Turtle, 41 3 F. 2d 683 - Court of A ppeals, 9th Circuit 1969.

Response:

EPA is taking a limited action in this rulemaki ng with clearly defined boundaries. We are finding under 40 CFR 49.11 that it is necessary or appropri ate to promulgate a FIP to implement the requirements in CAA section 169A and 40 CFR 51.308(e) to implement BART or a better than BART

alternative for NO x emissions at NGS. 364 The allegations of violations of other provisions of the CAA and of other statutes, treaties or laws are not within the scope of this action. EPA’s action in

364 EPA’s authority to act in this manner has been upheld in Arizona Public Service Co. v. EPA, 562 F.3d 1116, 1131 (10 th
Cir. 2009); see also WildEarth Guardians v. EPA, No. 13-9524, (10 th Cir. July 23, 2014) slip op. at 24-26, in the docket for this rulemaking.Page 230

EPA Responses to Comments: Navajo Gene rating Station Final Rule | July 28, 2014 promulgating this FIP is also sepa rate and independent of any allege d violations of Arizona state law based on potential requirements of th e Arizona Corporat ions Commission.

Comment: EPA lacks authority to regulate NGS

Three individuals (0043, 0137, 0346) indicated that EPA overstepped its aut hority, and five other individuals (0081, 0090, 0230, 0231, 0312) stated that EPA’s proposal hinders the state’s ability to deal

with environmental issues on a local level. Two co mmenters (0230, 0231) stated that SIPs are the best method for achieving a long-term tran sition to less carbon, and that the 10 th Amendment requires EPA to use the SIP when implementing these regulations.

One individual (0292) claimed that EPA does not have the authority to proceed with the proposed regulations because it failed to consider indi rect and direct costs of compliance, as outlined in

the CAA.

One individual (0127) stated that EPA’s regulations are an attack on free enterprise, and believes that Obama’s agenda to ban all co al-fired power plants regardless of the economic effect is no different from the agenda of a communist dictator.

Response:

EPA disagrees that it has overstepped its regulat ory authority and disagrees that any State has authority to regulate air polluti on from sources located on the Na vajo Nation. EPA’s authority to regulate NGS is derived from sec tion 301(a) and 301(d)(4) of the C AA. Section 301(d)(4) directs EPA to directly administer provisions of the CAA on Tribal land under ce rtain circumstances. The State of Arizona has no jurisdiction to regu late air pollution on Tribal lands. The D.C. Circuit upheld EPA’s promulgation of the TAR in Arizona Public Service v. EPA. The court characteri zed Congress’s addition of CAA section 301(d) in the 1990 Amendments, stat ing: “The Act establis hes a framework for a federal-state partnership to regu late air quality. The provisions of the 1990 amendments under review, fairly read, constitute an attempt by Congress to increase the role of Native America nations in this partnership.” 365 EPA is the proper governmental entity to re gulate visibility impairment associated with

NGS at this time.

EPA disagrees that the 10 th Amendment requires EPA to use a State Implementation Plan to implement the BART provision of the RHR. Th e comment provides no support for the statement.

EPA disagrees that the regulations promulgated in this action, which is approval of the TWG Alternative, consistent with the Appendix B of the TWG Agreement, constitutes an attack on free enterprise. The TWG Alternative authorizes NGS to continue to operate until 2044. The TWGAgreement was submitted to EPA by a stakeholder group that had determined it was a more costeffective approach to continuing to operate NGS than a prior propos al by EPA. EPA considered the direct costs of compliance in our five-factor BART analysis, and cons idered numerous indirect impacts and costs specifically in our anal ysis of Factor 2. The comment pr ovides no information other than conclusory statements that EPA failed to adequately consider the cost of co mpliance. Far from banning

365 211 F.3d 1280, in the docket for this rulemaking.Page 231

EPA Responses to Comments: Navajo Gene rating Station Final Rule | July 28, 2014 coal burning, this rule allows NGS to continue to opera te until 2044 when its lease with the Navajo Nation expires.

Comment: The Federal Government should set an example

One individual (0067) believes that the U.S. government, as a major owner of NGS, is responsible for setting a good example by requ iring the plant to run more efficiently.

Response:

EPA agrees that the Bureau of Reclamation, unde r the U.S. Department of the Interior, is a participant in NGS with a 24.3 percent share. As discussed in our Propos ed Rule, Reclamation participates in NGS for the benefit of the Centra l Arizona Project, and this relationship benefits numerous tribes in Arizona, as well as other water users, including municipal, industrial, and agricultural

users of CAP water. EPA notes that we are estab lishing a BART Benchmark ba sed on compliance with

an emission limit of 0.055 lb/MMBtu w ithin five years of the effectiv e date of the final rule. The

emission limit associated w ith the BART Benchmark for NGS is among the lowest NO x limits required

under BART. 366 We note that the 2009-2044 NO x Cap under the TWG Alternative is calculated based on the BART Benchmark, and that our final action on NGS will result in step-wise emission reductions to reduce the impact of NGS on visi bility at eleven Class I areas.

Comment: Political considerations

One individual (0080) stated that EPA’s propos al creates a foundation fo r political opposition to existing and future environmental policies because it is too costly and will achieve little to no benefits.

One individual (0116) claimed that EPA’s regul ation has nothing to do with haze, but rather political gains, and asserted that the federal govern ment has a vendetta against Arizona, as evidenced by federal law suits. Similarly, one individual (0128) belie ves that EPA has lost sight of its mission and is being used to carry out a political agenda.

One individual (0327) stated that EPA catered to local politicians that attend the public hearings, particularly the hearing held in Phoenix. The commenter claimed that these representatives, along with representatives from industry, provided no usable comments on haze.

Response:

EPA disagrees that this rulemaking is too costly and will achieve little to no benefits. We also disagree that this rule is for political gain and has nothing to do with haze. Our five-factor analysis

shows that our BART determination is cost-effectiv e and will significantly re duce the impact that NO x emissions from NGS have on visibility impairment at 11 Class I areas. In addition, our Supplemental Proposal is consistent with Appendix B of the TW G Agreement, which was developed by a group of diverse stakeholders, including the f acility operator, two tribal nations, CAP water interests in Arizona, and two environmental organizations, and represents a compromise among the various interests to

366 See spreadsheet titled “Western Coal EGU BART Summary.xlsx” in the docket for this rule.Page 232

EPA Responses to Comments: Navajo Gene rating Station Final Rule | July 28, 2014 achieve greater emission reductions than our propos ed BART determination in exchange for greater flexibility in the complian ce timeframe. In 1993, the 9 th Circuit Court of A ppeals upheld the rule finalizing the alternative to SO 2 BART for NGS. In concluding remark s, the Court stated: “Even if this case highlights how hard it is to engage in ‘reason ed decisionmaking’ in cas es involving scientific uncertainty, EPA’s actions in promulgating the Final Rule were reasonable and within the bounds of its statutory authority, and not arbitrary and capricious.” 367 EPA notes that Congre ss, under section 169A of the CAA, established as a national goal, the pr evention and restoration of visibility to natural conditions at our nation’s national parks and wilder ness areas and mandated EPA to develop a program that, among other things, required major stationary s ources of a certain age to install Best Available Retrofit Technology (BART) to reduce emissi ons of visibility-i mpairing pollution.

EPA recognizes the frustrati on expressed by one commenter re garding the public hearing in Phoenix, Arizona. The commenter asserts that EPA cat ered to local politician s at that hearing. EPA notes that more individuals signed up to speak in Phoenix than at a ny other hearing and that EPA staff

worked to ensure that all individuals who wished to provide oral comments had an opportunity to do so. EPA recognizes that some individua ls endured a lengthy wait to speak and EPA appreciates the time everyone who attended took to partic ipate in the public comment and hear ing process. In some cases, at the request of individuals, EPA did attempt to accom modate the schedules of local elected officials. However, EPA gives equal weight and consideration to all written and oral comments submitted to EPA on our proposed rulemakings.

Comment: War on coal

One commenter (0258) stated th at if EPA moves forward with the BART proposal, it can only mean that the agency, and the administration it serves, is determined to wage a war on coal regardless of the cost to the country’s economy and its citizens. According to the commenter, EPA’s radical and unprecedented agenda will increase costs for Arizona bus inesses and residents, endanger the long-term viability of Arizona’s agriculture industry, and deal a severe blow to the state’s economic recovery, as well as ignore the customs, cultures, and well-being of Arizona's communities.

Response:

EPA disagrees that our action in this rulemaking for NGS represents a war on coal. Under section 169A of the CAA, Congress required major stat ionary sources of a certain age that cause or contribute to visibility impairment at Class I areas to install BA RT. NGS is subject to the BART requirement of the CAA and is among the largest sources of NO x in the country and impacts visibility at 11 Class I areas, including the Grand Canyon and ot her National Parks and Wilderness Areas where visibility is an important value. Our five-factor analysis shows that our proposed BART determination is cost-effective and will significan tly reduce the impact NGS has on the surrounding Class I areas. However, in our proposed BART determination, EP A also recognized the im portant relationship NGS has with tribes, as a source of re venue to two tribal governments and as the source of power to deliver

CAP water to numerous tribes th roughout Arizona. Based on the unique role of NGS, EPA put forth a

framework for BART Alternatives that credited NGS with early a nd voluntary emission reductions and provided additional compliance flexibility in excha nge for greater emission reductions. EPA proposed

an Alternative to BART that extended the compliance timeframe to 2021-2023 (Alternative 1) and

367 CAWCD v. EPA, 990 F.2 nd 1531 (9 th Cir. 1993).Page 233

EPA Responses to Comments: Navajo Gene rating Station Final Rule | July 28, 2014 invited stakeholders to submit addi tional alternatives to BART. Follo wing our proposed rule, a group of diverse stakeholders, known as the Technical Work Group (TWG) developed an agreement that

included a BART Alternative that results in greater emission reduc tions than our proposed BART determination in exchange for a longer compliance timeframe to install air pollution controls. This compromise balances the interests of numerous stak eholders in NGS, including the owners of NGS, the operator of the CAP, two tribal nations, and two environmental groups. EPA put forth a Supplemental Proposal based on our evaluation of Appendix B to the TWG Agreement and is finalizing regulatory requirements for NGS that we put forth in the Supplemental Proposal.

Comment: State regulators/politicians

One individual (0248) asserted th at local regulators have become too familiar with those they regulate. The commenter advocated for a change from th e current rate structure (p resent Cost [base rate] plus profit [ROR]) to a structure th at recovers costs but pays profit ba sed on sharing of cost reductions with ratepayers and facilitating th e development of local solar electr ic generation and storage solutions.

Another individual (0281) noted that state representatives ha ve long received significant campaign contributions from utility companies, which likely influence their decision-making process. A third individual (0284) similarly pointed out that his Congressman receives contributions from power companies and mining interests, and is a champion of their causes in th e name of jobs. While acknowledging that jobs are important , the commenter stressed the importance of a livable environment

in which to work.

Response:

Although EPA has included a summary of this comment in this response to comment document,

this comment is not related to our BART determ ination for NGS. Therefore, EPA is not providing a response to this comment.

Comment: Tribal assistance

One individual (0415) questioned what the fe deral government is doing to help tribal communities in their effort to develop alternatives to coal power. The commenter stated that without the EPA’s assistance, national energy policies like Pr esident’s Obama, “Blueprint for a Secure Energy Future” will have no hope in being implemented, part icularly if congressional power shifts during the

2014 and 2016 elections.

Response:

In addition to the commitments made by DOI, DOE, and EPA in the 2013 Joint Statement on NGS to collaborate on several short- and long-term goals, including completion of the NREL Phase 2 study to analyze a full range of cl ean energy options for NGS, and the commitments made by DOI in the TWG Agreement related to low-emitting energy projects to benefit affected tribes, DOE and DOI also have programs related to renewabl e energy on tribal land. DOE runs th e Tribal Energy Program within the Office of Energy Efficiency and Renewable Energy to provide financ ial and technical assistance toPage 234

EPA Responses to Comments: Navajo Gene rating Station Final Rule | July 28, 2014 enable tribes to evaluate and develop renewable energy resources. 368 DOI, through the Bureau of Indian Affairs, runs the Office of Indian Energy and Economic Development to assist tr ibes in the exploration and development of energy resources. 369

Comment: Alternative energy sources

Several individuals (002 5/0156, 0040, 0113, 0123, 0248, 0149, 0235, 0253, 0264.6, 0341) argued that NGS and other coal-fir ed power plants should be phased out and replaced with renewable and sustainable energy sources (e.g., solar, nuclear, and natural gas) . Most of these commenters noted that Arizona’s climate is ideally suited for sola r technology, and believe that the use of alternative energy sources would reduce emissions of harmful po llutants. One commenter ( 0113) contended that the coal and power industry should be required to implement best pr actices, since they are heavily subsidized by U.S. taxpayers. Another commenter ( 0149) noted that existing power plants that have switched from coal to alternative power sources (e .g., wind and solar power) have already begun to reap the economic benefits of switching (e.g., lower operating costs).

Four individuals (0248, 0240, 0394, 0399) indicate d that an economy built on renewable energy sources would create job opportunities and generate revenue just as much as, if not more than, a coalpowered economy. One of these commenters (0399) stated that he has been working with the community of Cameron, Arizona, to establish a 5 00 MW wind farm on top of Gray Mountain, since 2007, but the project has been highly discouraged by the Navajo Nation and i ndustry representatives.

Another commenter (0248) believes that ut ility leaders and the Arizona Corporation Commission, not rate or tax payers, should be responsible for the true cost associated with fossil-fueled generation, such as the annual loss of billions of gallons of water due to evaporation, reduced annual rainfall due to climate change, and what the commen ter termed the “billions of dollars in annual costs charged to ratepayers to mitigate the shortcomings of fossil-fueled generation,” which the commenter

listed as follows:

 Fuel surcharges.

 Time-of-use/demand charges.

 Transmission infrastructure and related signi ficant energy losses, which result in more generation/emissions.

 The selling of surplus electricity at less than co st to a few customers at night, shifting of the unrecovered costs to other ratepayers, because baseload plants are not dispatchable.

 The location of baseload plants in remote regions because they are noxious to humans.

The commenter (0248) stated that although the circumstances are difficult and complicated, these

costs/revenues can be realloca ted to establish local solar ( photovoltaic) electric generation, within/adjacent to distribution infrastructure, closer to load centers. The comm enter added that bids for

those facilities should include local manufacturing of components, where feasible, and require the market to partner and provide ec onomical storage technology, which the commenter believes is a true “game changer.” The commenter believes that this approach would generate enormous trade and revenue throughout America, Mexico, and the rest of world, and that renewable energy credits could be

368 http://apps1.eere.ener gy.gov/tribalenergy/

369 http://www.bia.gov/WhoWeA re/AS-IA/IEED/index.htmPage 235

EPA Responses to Comments: Navajo Gene rating Station Final Rule | July 28, 2014 sold on the developing national car bon market to generate revenues an d facilitate the development of new jobs and the retraining required to re-employ those impacted by the closing what the commenter considers to be an obsolete technology. The commente r suggested that Cleantech Federal Grants could be acquired to promote the develo pment of this generation model.

The commenter (0248) also stated that at less than $2 per watt, sola r electric genera ting facilities (250 MW to 500 MW) can be establis hed at load points and lift stat ions, along the CAP aqueduct at less cost than the emissions scrubbing equipment. The comm enter added that these faci lities can also provide fixed-price electricity for 25 to 30 years in a manner th at could reduce the loss of billions of gallons of potable water each year to evaporation. The commente r cited the EIA which stated that a hydroelectric dam loses 6.5 gallon per kWh of wate r to surface evaporation, and noted that the CAP aqueduct is hundreds of miles in length with substantial surf ace area and motion which promotes evaporation. The

commenter further noted that electr icity generation loses 3/4 gallon per kWh of water to evaporation via steam, which is a combined loss of billions of gallons of precious potable CAP water each year.

On the other hand, three individuals (0064, 0266, 0392) questioned whether there are any viable alternative energy sources readily available that could easily re place coal. One commenter (0266) highlighted that in 2012, partly due to an increase in population, coal accounts for nearly 41 percent of Arizona’s power. The commenter continued that the co ntribution of coal in Ar izona is so great that replacing it would require the state to construct 6 nuclear powe r plants, build the equivalent of 11 Hoover Dams, or install over 12,500 wind turbines st retching more than 2,500 miles. Additionally, the

commenter noted that over the last 10 years, the price of coal to produ ce electricity in Arizona averaged only $1.95 per unit, while the price of natural gas averaged over $5.75 per unit. The commenter added that the price of natural gas is extremely volatile compared to coal; thus, making it difficult to predict overall costs, which will only worsen as the demand for gas increases domestically and internationally.

The commenter reference EIA data that indicat ed new gas production by 2025 will equal almost 5 trillion cubic feet, far less than the estimated demand.

Response:

Although EPA has included a summary of this comment in this response to comment document,

this comment is not related to our BART determ ination for NGS. Therefore, EPA is not providing a response to this comment. As stated elsewhere in this response to comments document, EPA does not have authority through BART to redefine a source to require a coal-fired po wer plant to convert to renewable energy or other fuel sources.

Comment: CO 2 emissions

A few individuals (0040, 0230, 0231, 0240, 0312, 0345, 0363, 0431, 0437) commented on CO 2 emissions. One commenter (0040) s upports any effort to control CO 2 emissions and asked whether carbon dioxide capture and sequest ration technology has been resear ched as a possible control. Similarly, another commenter (0240) stated that NGS is Arizona’s single larg est individual source of carbon pollution and one of the largest sources of car bon pollution in the countr y, and claimed that NGS emits more carbon into the atmosphere than 3 million cars.

Four commenters (0230, 0231, 0312, 0431) oppose car bon regulations for existing coal-fired power plants (e.g., carbon cap and tax), including NGS , because most believe that such regulations doPage 236

EPA Responses to Comments: Navajo Gene rating Station Final Rule | July 28, 2014 not take into account variation in costs depending on an area’s topography. Three commenters (0230, 0231, 0437) noted that Arizona does not have oil wells into which CO 2 can be pumped nor does the state have natural gas supplies.

Another individual (0345) recommended the in stallation of OxyFuel Technology, which the commenter believes can be used to capture CO 2 emissions in the combustion gases. The commenter explained that this technology, on a moisture free basis, concen trates the carbon dioxide in the combustion gases from the conventional ±20 per cent by volume to ±80 percent by volume, almost complete carbon capture. The commenter submitted more technical information a nd data as an appendix

to the comment.

Response:

Although EPA has included a summary of these comments in this response to comment document, these comments are not related to this ru lemaking to reduce emissions of visibility-impairing pollutants from NGS. EPA has clearly defined the boundaries of this action. Therefore, EPA is not providing a response to this comment. As stated elsewhere in this re sponse to comments document, EPA does not have authority through BART to regulate CO 2 emissions and that the BART determination is

an emission limit for NO x , rather than a requirement to inst all a specific technology. Therefore, the operator of NGS has flexibility in stall a different control technology that has co-benefits for other pollutants, as long as the technology meets the BART emission limit for NO x
.

Comment: Lack of Consultation with Tribes

The Navajo Nation (0024/0098/0316/0326) commented that EPA should improve communication at the start of any rulemakings to ensu re that the Navajo Nati on can provide meaningful

information. The commenter said that even when th e Agency develops supporting rule information like the RIA the Navajo Nation would like to be involv ed as it could impact the Nation. The commenter pointed out that EPA has known for decades that NGS and FCPP located on the Navajo Nation and that the Nation would be impacted by re gulation of those facilities. The commenter quoted excerpts from

Executive Order 13175 - Consultation and Coordination w ith Indian Tribal Governments and said that the standard for determining if a regulation has tribal implication is not whethe r it “impose[s] substantial direct compliance costs on tribal governments,” but rath er a regulation has “substantial direct effects on one or more Indian tribes.” The commenter said that it has on numerous occasions indicated this concern to the Agency, but felt compelled to reemphasize this.

The commenter (0024/0098/0316/0326) indicated th at in August of 2009, one day prior to the ANPR for NGS and FCPP, EPA made a courtesy ca ll to the President of the Navajo Nation. The

commenter said that it was not consulted duri ng the development of the ANPR. The commenter indicated that in the end, the two facilities were addressed and regulated separately. But, the BART process should have been properly analyzed and proposed separately be cause each facility is unique and

has distinctive features affecti ng the Nation and the area it is locat ed on. The Navajo Nation believes that if early and meaningful consul tation with the Nation had occurred th is could have led to an adequate 5-factor analysis and careful exam ination of non-air quality impacts.

The commenter (0024/0098/0316/0326) subm itted comments on the ANPR on March 1, 2010, where it addressed concerns about the compliance sc hedule and other non-air quality impacts that thePage 237

EPA Responses to Comments: Navajo Gene rating Station Final Rule | July 28, 2014 commenter believes were not adequately considered in the ANPR. In the comments, concerns about tribal consultation with EPA, the economic interests of the Navajo Nation, inconsistencies between the anticipated compliance costs presented by NGS, FCPP, and the NPS, plus concerns with visibility improvement, were voiced. The commenter reiterated that moving forward, there are many actions that may have the potential to negatively impact the Nava jo Nation and other tribes, and it is essential for EPA to consult with the Navajo Nation to be its st atutory obligations prior to issuing a final rule.

In a separate letter, the commenter (0024/0098/ 0316/0326) asked that additional discussions between the Navajo Nation and EPA take place to co mply with the requirements of Executive Order 13175, Consultation and Coordination with Tribal Governments. The commenter has previously indicated its objection to the propos ed BART for NGS, which would have drastic effects on the Navajo Nation’s economy. The commenter requested to discuss these issues with EPA, plus new and relevant information including the Navajo Nation and NGS owners’ 2013 lease amendm ents and the 2013 ASU Economic Impacts to the Navajo Nation Report. The comme nter said that the EPA needs to consider this new information as the Agency moves forward with the regulation and take into account the impact regulatory requirements would have on the Navajo Nation’s major source of revenue.

The Gila River Indian Community (0039/0317) expressed similar con cerns regarding the lack of

consultation. The commenter said that the last ti me EPA consulted with the Community was August 7, 2012. During this consultation, the commenter said that it was with the unders tanding that EPA would describe to the Community the pr oposed regulation prior to the rule making being issued. Instead, the commenter said, EPA called the night before issuing the rule, which the commenter said was inadequate and inconsistent with the expecta tions regarding consultation. The co mmenter also understood that the rule was to be proposed in September 2012, howev er, it was not proposed until January 2013 and in meantime several stakeholders provided additional input to the Agency. However, the Community was not consulted during this time. Acco rding to EPA, it will be 2 year s between proposal and promulgation of the rule, the commenter said and indicated that it expects at least two more substantive consultation sessions. In addition, th e Community expects an expl anation of the final rule after it is issued by EPA.

Another tribal government (0134) (The Hopi Tribe) also commen ted on the lack of consultation and involvement of tribes in developing the regu lation. The commenter submitted multiple letters to EPA indicating its concern about not being involved in the developmen t of the rule and consulted and not having access to pertinent inform ation. In one of the letters, the commenter said that the government acknowledged the Hopi Tribe as a stak eholder and the intention to work with the Tribe, however, this is contrary to the following excerpt from the Joint Federal Statement, the commenter said:

The NGS Working Group intends to work with stakeholders, including NGS plant owners, Navajo Nation, Hopi Tribe, CAP, Gila River Indian Community and other Arizona Indian tribes who receive water from CAP...It should be consistent with Federal trust responsibilities to federally recognized Indian tribes in the region.

The commenter (0134) specifically indicated that it was denied information regarding the TWG Alternative and the development of the alternative, something the commenter pointed out is essential in order to provide relevant and useful comments to EPA. The commenter said that it has submitted two Freedom of Information Act requests to the DOI, whic h included all of NGS’ construction and operating permits issued since 1990, and any documentati on of NGS’ capital expenditures and service, maintenance, and repair since 2000. Also, the comment er requested paperwork on the three units at NGSPage 238

EPA Responses to Comments: Navajo Gene rating Station Final Rule | July 28, 2014 related to the repair, re trofit and modification of the units si nce 2000, information on when the units were installed, their capacity, operati ng hours, the type and amount of fuel used, the electricity generated since 2000, and details on the emissions from the units since 2000.

The commenter (0134) also indi cated that in its request under FOIA to the DOI, the commenter asked for information documenting the DOI’s representa tion of the Hopi Tribe during the negotiation of the BART Alternative, s upporting information used by the DOI duri ng this process, and various other information evidencing DOI’s actions during the ne gotiation. The commenter said that until it has the information requested via FOIA, it is not able to provide written comments on the TWG Alternative. The commenter (0134) added that the Non-Disclosure Agreement has prohibited the Hopi Tribe from obtaining necessary information.

The commenter asserted that it is has been treated differently than other tribal stakeholders in the TWG Agreement. For example, the TWG Agreement st ates that SRP will advocate to EPA the Navajo Nation’s treatment as state status (TAS). The Hopi Tribe indicated that the SRP would likely oppose the Hopi Tribe being treated as a stat e and given TAS status due to the adversarial positio ns taken by SRP opposing the Hopi Tribe in the LCR adjudication that is currently ongoing and in failed attempts to settle the LCR adjudication. In addition, according to the commenter, SRP demanded that the Hopi Tribe be excluded from the TWG, which in the co mmenter’s opinion would sugge st that SRP would be against the Hopi Trib e obtaining TAS status.

The commenter (0134) indicated that the TWG Agr eement protects the economic interests of the Navajo Nation and the Gila River Indian Community; two stakeholders who were involved in the TWG, but compromises the coal revenues of the Hopi Tribe and contains no mitigation measures for this significant and adverse economic impact. The Hopi Tr ibe indicated that it will be disproportionately adversely impacted by the reduced capacity at NGS . The commenter additionally said that the stakeholders who were part of the development of the TWG Agreement have ta ken opposite positions of the Hopi Tribe in terms of water rights to the Colorado River and Little Colorado River. Both water sources affect NGS operations, the commenter sai d. SRP, the Navajo Nation, and the Gila River Community are all competing claimants to the Hopi Tribe for water from the LCR and the mainstem

Colorado River and so therefore the commenter said that these claimants have an unfair advantage over the Hopi Tribe since they were involved in the TWG. The commenter strongly opposes how the impacts

were assessed for NGS affected tribes and the outc ome of the rule should not economically reward one tribe at the expense of another tribe.

The commenter (0134) asserted that EPA is required to consider tribal impacts and fulfill its trust obligations and said that the U.S. President has dir ected the Agency to consid er tribal impacts. Another tribal government (0039/0317) also expressed these concerns. The co mmenter referred to the Ninth Circuit, which has recognized EPA’s trust obligati ons to Tribes affected by a rulemaking. The

commenter believes that the DOI has a conflict of intere st due to its dual roles as part owner of NGS via BOR and as owing trust responsib ilities to the Hopi Tribe.

The Kaibab Band of Paiute Indians (0421) expre ssed similar concerns regarding the lack of

involvement of Indian Tribes and demanded that EP A consider the requests of the Kaibab Paiute. The commenter referred to the TWG Agreement and request ed that the Kaibab Paiute Indian Reservation receive $2.5 million of the $5 million Local Benefit Fund designated for community projects within 100 mile of NGS (the reservation is 60 miles from NGS). Also, the commenter said that the TWG Agreement promotes the development of clean energy, and based on that provision of the agreement, thePage 239

EPA Responses to Comments: Navajo Gene rating Station Final Rule | July 28, 2014 commenter requested a 250 MW solar farm for ec onomic reasons. The commenter indicated that the Navajo McCullough 500 kV transmissi on line crosses the reservation in two locations and therefore said that the infrastructure is already in place. Related to that, the commenter wished to renegotiate the lease

on this transmission line that runs through the commenter’s reserva tion. The commenter believes that the provisions of the TWG Agreement will help the Ka ibab Paiute see through its commitments to tribal communities and stressed that it wishes to prot ect its water rights with Arizona and Utah.

The Tohono O’odham Nation (0340) objected strongl y to the TWG worki ng group, specifically

the fact that a number of Indian na tions that would be subs tantially affected by the rule were excluded from the working group. These affected stakehol ders should have been part of the TWG. The commenter noted that it is partic ularly concerned with maintaini ng CAP water delivery under whatever rule is finalized by EPA.

Response:

EPA understands that NGS is important to numer ous tribes located in Arizona and we take seriously our trust responsibility to Indian tribes affected by NGS. As a result, we have attempted to

ensure that these tribes were cons ulted throughout the rulemaking proces s. We respectfully disagree that

there was a lack of c onsultation with tribes.

EPA agrees with the commenter that Executive Order 13175 defines “policies that have tribal implications” to refer to regulations or other actions that have substa ntial direct effects on one or more

Indian tribes. 370 In our discussion of EO 13175, we included consideration of substantial direct compliance costs to tribal governments, as well as the broade r consideration of subs tantial direct effects

on one or more Indian tribes. We c oncluded that our proposed action on NGS will have tribal implications, noting that indirect effects may result from the TWG Alternative and Reclamation’s ownership interest in NGS, including decreased re venues to the Hopi Tribe and Navajo Nation in 2019

as well as increased water costs to tribes receiving CAP water in 2030. However, EPA also notes that this Final Rule will not impose substantial direct compliance costs on Indian tribal governments because no tribal government is an owner or participant in NGS and therefore no tribal government will be required to pay direct costs of compliance. 371 We also conclude that this rule is required under the CAA because NGS is a facility that is subject to BART.

In our proposed rule, EPA provided a docum ent that listed all written or telephone correspondence as well as consultation meetings between EPA and Tribes on NGS. The list that was included in the docket for the proposed ru le was current as of January 9, 2013. 372 The commenter asserts that EPA did not consult with the Navajo Nation during the development of the ANPR and implies that EPA’s telephone call to the Presiden t of the Navajo Nation one day prior to the signature of the ANPR in August 2009 was our first communication with the Navajo Nation on the subject. EPA notes that our timeline of correspondence and consu ltation first lists written and tele phone correspondence (pages 1-3 of the January 9, 2013 document) and then lists consu ltation meetings (pages 4 and 5 of the January 9,

370 http://www.gpo.gov/fdsys/pkg/WCPD-2000-11-13/pdf/WCPD-2000-11-13-Pg2806-2.pdf

371 We also note that the Navajo Nation has the option to purchase up to a 170 MW share of NGS in 2019. EPA understands that the Navajo Nation has not yet made its decision and therefore, currently, no tribal government is a Participant in NGS.

372 See document titled “2013_0109 Timeline of all tribal consu ltations on NGS.docx” in the docket at EPA-R09-OAR-2013- 0009-0005. For our final rule, EPA has updated this timeline. See document titled “Updated Timeline of all tribal consultations on BART for final rule.docx” in the docket for this rulemaking.Page 240

EPA Responses to Comments: Navajo Gene rating Station Final Rule | July 28, 2014 2013 document). Although the August 19, 2009 telephone ca ll between EPA and President Shirley was the first item listed in our timeline, we noted that a meeting between EPA and the Navajo Nation occurred two months prior to the ANPR, during the development of the ANPR, to discuss EPA’s plans to move forward on an ANPR related to our on-going BART analyses for FCPP and NGS (see listed item indicating consultation meeting on June 10, 2009 between Laura Yoshii, Acting Regional Administrator of EPA Region 9, and President Joe Shir ley, Jr., of the Navajo Nation, to discuss moving forward on the ANPR for Four Corners Power Plant and NGS). 373 EPA further notes that the ANPR was not a proposed rule. The ANPR was an Advanced Notice of Proposed Rulemaking where we provided the public advance notice of our intention to de velop rulemakings for FCPP and NGS. EPA included some initial analysis of the two BART factors and st ated that the “specific purpose of this ANPR is for

EPA to collect additional information.” 374 Subsequent to the publicati on of the ANPR in the Federal Register on August 28, 2009, and prior to our propos ed rule on NGS, EPA held four consultation meetings with tribes in 2009, ei ght consultation meetings with tr ibes in 2010, eight consultation meetings in 2011, and ten consultati on meetings with tribes in 2012. 375 Of these meetings, at least eight were held as group consultation sessi ons where all tribes in Arizona were invited to participate and were provided the opportunity to request indi vidual consultation meetings as well. 376

The Navajo Nation, the Hopi Tribe, the G ila River Indian Community, the Tohono O’odham Nation, the Ak-Chin Indian Commun ity, the Pascua Yaqui Tribe, th e Fort McDowell Yavapai Nation, and the Yavapai-Apache Nation, and the Inter Tribal Council of Arizona submitted comments to EPA on the ANPR. EPA summarized and provided responses to comments received from tribal governments in the TSD for our proposed rule on NGS. 377 The primary concerns expressed by the tribal governments related to the economic importance of NGS and the relationship of NGS with CAP and Indian Water Settlement Agreements. The Navajo Nation also co mmented on specific aspects of the five-factor analysis for BART, and the Hopi Tribe submitted an economic study it had commissioned that expresses concern that regulatory actions woul d force NGS to close. In our propos ed rule and in the development of our proposed framework for BART Alternatives , including the credit fo r early installation of LNB/SOFA, EPA recognized the importance of NGS to tribes in Arizona, both in contributing to the economies of the Navajo Nation and Hopi Tribe, and in serving as a source of electrical power for CAP

and a source of revenue to the Lower Colorado Ri ver Basin Development Fund, as related to water settlement agreements with numerous tribes in Arizona. Based on this recognition, EPA put forth additional options for greater flexibility in the comp liance timeframe and invited stakeholders to develop

and submit additional BART Alternatives to EPA for consideration.

Following the publication of our proposed ru le on February 5, 2013, EPA engaged in 17 consultation meetings with tribes prior to th e January 2014 close of the public comment period. 378 Of these meetings, at least two were held as group consultation sessions wh ere all tribes in Arizona were

373 See document titled “Updated Timeline of all tribal consultations on BART_for final rule.docx” in the docket for this rulemaking, page 4.

374 See 74 FR 44313 at 44314 (August 28, 2009).

375 See document titled “2013_0109 Timeline of all tribal consultation on NGS.pdf” in document number 0005 in the docket for the rule at EPA-R09-OAR-2013-0009 and document titled “Updated Timeline of all Tribal Consultation on NGS_for Final Rule.pdf” in the docket for the rule at EPA-R09-OAR-2013-0009.

376 Id., and See, e.g., document 0008 in the docket for the rule at EPA-R09-OAR-2013-0009.

377 See TSD to the Proposed Rule, document 0014 in the docket for the rule at EPA-R09-OAR-2013-0009. See e.g., pages 25

and 56.

378 See document titled “Updated Timeline of all Tribal Consultation on NGS_for Final Rule.pdf” in the docket for the rule at

EPA-R09-OAR-2013-0009.Page 241

EPA Responses to Comments: Navajo Gene rating Station Final Rule | July 28, 2014 invited to participate and were provided the opportunity to request individual consultation meetings as

well. 379 EPA received comment letters on our proposal and Supplemental Proposal from the Navajo Nation, the Gila River Indian Community, the Tohono O’odham Nation, the Ak-Chin Indian Community, the Tonto Apache Tribe, the San Carlos Apache Tribe, and the Kaibab Band of Paiute

Indians. 380 At the request of two tribes for additional time beyond January 6, 2014 to submit comments, EPA exercised our discretion to accept comments from tribal governments after the close of the comment period. The White Mountain Apache Tribe submitted comments on February 5, 2014. 381 In addition, in response to their reque st to EPA for information relate d to NGS, we provided responsive documents to the Hopi Tribe on January 7, 2014. 382 As shown in additional correspondence, the Hopi Tribe requested additional time to submit comments, and EPA continued to exer cise our discretion to accept late comments from the Hopi Tribe. 383

Several tribes also expressed concern that the TWG included onl y two tribes, the Navajo Nation and the Gila River Indian Community, and excluded num erous other tribes that also have a significant economic interest in NGS. EPA recogni zes that many tribes were exclud ed from the development of the TWG Agreement. EPA was not involved in the fo rmation of the TWG or any of the negotiations

between the members of the TWG in developing the TWG Agreement. In addition, our evaluation of the TWG Agreement was for the sole purpose of determining whet her the Appendix B to the TWG Agreement meets our framework for a “better than BART” Alternative. Theref ore, although EPA agrees that many tribes have economic interest in NGS and CAP, EPA does not have any role in the

distribution of funds described in the TWG Agreement. We understa nd that DOI provided its response to the FOIA submitted by the Hopi Tribe. 384

Based on numerous consultation meetings betwee n high-level officials from EPA and elected tribal leaders, beginning in 2009 and extending into 2013, and our develo pment of flexible options for BART Alternatives in response to comments from tribes, EPA consid ers our consultation on NGS to be consistent with EO 13175 and EPA’s policy to enga ge in early and meaningful consultation with

tribes. 385 EPA will provide notific ation of our final rule, in writi ng, to all tribal governments that submitted comments to EPA on our Proposed Rule or Supplemental Proposal and will provide our written responses to their specifi c comments. All written corresponden ce from tribal governments to EPA regarding NGS and our proposed BART determ ination is available in the docket for this rulemaking. 386

Comment: Communication within the Navajo Nation

379 Id.

380 See comment numbers 0340, 0317, 0387, 0402, 0419, and 0421 in the docket for the rule at EPA-R09-OAR-2013-0009.

381 See comment number 0440 in the docket for the rule at EPA-R09-OAR-2013-0009.

382 See document titled “2014_0107 EPA Letter to Chairman Honanie with Enclosure 1.pdf” in the docket for this rule at

EPA-R09-OAR-2013-0009.

383 See document titled “2014_0131 Letter from Chairman Honanie.pdf” and document titled “2014_0206 EPA Response to Chairman Honanie_Hopi Tribe.pdf” in the dock et for this rule at EPA-R09-OAR-2013-0009.

384 See document titled “DOI FOIA response to Hopi Tribe” in the docket for this rulemaking.

385 EPA’s policy on Consultation and Coordination with Indian Tribes is posted on the following website: http://www.epa.gov/tribal/con sultation/consult-policy.htm

386 See Appendix A (List of Written Comments) to this response to comments document and the docket for this rulemaking at

EPA-R09-OAR-2013-0009.Page 242

EPA Responses to Comments: Navajo Gene rating Station Final Rule | July 28, 2014 One individual (0025/0135) stated that he di d not receive 0177-13 until 2 hours before the final vote, that all meetings were held in secret from the Navajo Nati on public, and only certain portions of 0177-13 were made available to the Navajo Nation public.

One individual (0025) stated th is NGS lease is very important to the Navajo people and should not be kept in secret. Commenter asserted the Navajo Nation says lo ss of the NGS will have devastating impacts on the Navajo people, but yet the Navajo Nation keeps the NGS lease secret from its own people.

Response:

EPA included this comment in our response to comments document because it relates to the NGS lease renewal. However, we not e that this comment does not relate to a specific aspect of our BART determination for NGS, nor does it related speci fically to EPA, therefor e, EPA is not responding

to this comment.

Comment: Additional Public Hearings Needed

A few government commenters (0082, 0095, 0097, 0104) re quested that in order for meaningful comments to be developed and submitted on this ru le, EPA should hold additional public hearings to

hear from affected stakeholders. Some of the commenters, including commenters 0104 and 0082 suggested a number of hearings in the Phoenix area and in Arizona in an effort to obtain a complete picture of the direct and indirect impacts of the ru le. According to several of the commenters, hearing directly from all affected stakeholders would lead to sound policy decisions.

Response:

The public comment period for EPA’s proposed rule was open for nearly one year and the public comment period for EPA’s Supplemental Proposal extended for over two months. 387 In addition to the lengthy public comment period, EPA held five public hearings in combination with open house events,

at locations that extended from northern Arizona , to central and southe rn Arizona, and included locations on the Navajo Nation and the Hopi Tribe. Many of the tribes receiving CAP water are located

in central and southern Arizona. EP A considers our public outreach a nd public comment process to have

been extensive and allowed EPA to hear and receiv e comments from any affected stakeholder that wished to submit comments on our proposed rulema kings. As noted elsewhere, EPA received over 77,000 comments on our proposed rulemakings on NGS.

Comment: NGS importance to public policy goals

A CAP agricultural water users group (0305) stat ed that NGS and CAP are key components of a comprehensive resolution of a number of contenti ous, long-standing public policy disputes in Arizona.

387 We note that the public comment period for the Supplemental Proposal should have extended longer, i.e., EPA signed the Supplemental Proposal on September 25, 2013. On the same day, EPA made the pre-publication version available online in the docket and on our website. However, publication of the Supplemental Proposal in the Federal Register was delayed due to the shutdown of the federal government that extended from October 1 – 16, 2013. The Supplemental Proposal published in the Federal Register on October 22, 2013.Page 243

EPA Responses to Comments: Navajo Gene rating Station Final Rule | July 28, 2014 The commenter indicated that finaliz ing the proposed rule would upset those public policy goals in the following ways:

 Federal and state legislation rela ted to CAP were both put in place with the idea that CAP water, made available and affordable by NGS-generated power, would be a replacement for Arizona’s non-renewable groundwater. If the pr oposed rule is adopted in its current form, much of Central Arizona farming will return to groundwater pumping because the installation of SCR would lead to significant increases in CAP water rates, ma king it relatively less attr active than groundwater pumping.

 The NGS and CAP facilitated re solution of water rights disput es between tribes and other

Arizona water users. The 2004 Arizona Water Sett lements Act resolved disputes about the longterm water rights of the Gila River Indian Co mmunity. Agricultural water users provided a substantial supply of long-term CAP water to the Gila River I ndian Community in return for rights to affordable CAP water through the year 2030. If the proposed rule is adopted in its current form, this compromise will be nullified, because agricultural water users will be forced off of CAP water because it will become too expensive.

 The ready supply of power generated by the NGS e liminated pressure to generate hydropower in the Grand Canyon. The EPA noted in the preamble to the proposed rule that “Federal participation in NGS was authorized in the Colorado River Basin Project Act of 1968 as a preferred alternative to buildi ng hydroelectric dams in the Grand Canyon for providing power to the Central Arizona Project.

The CAP operator (0343) similarly st ated that one of Congress’ prim ary objectives in authorizing the CAP was to provide a renewable wa ter supply to reduce the overdraf t of groundwater in central and southern Arizona, and it has achieved that aim. Th e commenter indicated that for CAP water to be a viable alternative to groundwater, its cost must be competitive with groundwater pumping, and that competitively priced CAP water is inherently linked to the affordable power that NGS provides because that power is a significant component of CAP wate r rates, particularly fo r Arizona’s tribes and agricultural interests.

This commenter (0343) indicated that affordable CAP water has been a crucial component in the successful negotiation of multiple Native American wa ter rights settlements in Arizona, adding that today 46 percent of CAP water is dedicated to Indian use, with nine tribes holding contracts for CAP water. An industry/commerce commenter (0416) also made this point. The CAP agricultural water users group (0305) also pointed out that NGS power ava ilable to CAP but not needed for CAP pumping (“Navajo Surplus”) is sold pursuant to federal law and policy to help repay the construc tion costs of the CAP and fund the costs of Indian water rights settle ments in Arizona, as specifically authorized by Congress. Thus, according to the commenter, NGS is cr itical not only to CAP ope rations and the ability

of CAP to meet its statut ory purposes, but also in the creation of Navajo Surplus that is available to bolster CAWCD finances and help fulfill commitments made in numerous Indian water rights

settlements.

Response:

EPA recognizes that NGS is a critical component of CAP. We also appreciate the importance of policies to reduce groundwater use in the state of Arizona and support wa ter settlement agreements withPage 244

EPA Responses to Comments: Navajo Gene rating Station Final Rule | July 28, 2014 tribes in Arizona. EPA discusse d the history and importance of NGS in our proposed rulemaking. 388 We note that the potential impacts of our proposed BART determination fo r NGS on tribes in Arizona, was the impetus for the development of a framework fo r better than BART Alte rnatives that provided additional flexibility to NGS for the timeframe for achieving emi ssion reductions at NGS. Although we are establishing a BART Benchmark based on our proposed BART determination, the regulatory requirements that we are finalizi ng in today’s action are the requi rements and compliance timeframes based the TWG Alternative as published in our Suppl emental Proposal. Therefore, EPA is taking action to require emission reductions at NGS to reduce impact on visibility impairment at 11 Class I areas, in a manner that provides the necessary flexibility to reduce adverse impacts to tribes in Arizona.

Comment: Maintain cooperation among stakeholders in implementing fu ture regulations

One state agency (0017/0289/0320) noted that EPA is continuing to implement a number of new environmental initiatives targeted at power plant emissions and stated that any such initiatives at NGS should be undertaken in a spir it of cooperation between interest ed stakeholders and EPA. The commenter reiterated the importance of NGS to th e State of Arizona, including tribal and local communities, and stated that because the plant owne rs and the state have gone through considerable effort to preserve this unique plant, it deserves some amount of regulator y certainty. The commenter

asked that EPA consider all of the benefits afforded under the current proposal as it looks to implement future regulations.

Response:

As stated previously, EPA recognizes that NGS is a critical component of CAP, policies to reduce groundwater use in the state of Arizona, and water settlement ag reements with tribes in Arizona. EPA discussed the history and importance of NGS in our proposed rulemaking. EPA acknowledges the sentiment expressed by this commente r regarding the importance of regu latory certainty and the request

that EPA consider the benefits of the TWG Agreement in the implementation of future regulations.

Comment: Sound science

Without being more specific, an association of CAP water distributors (0398) urged the EPA to address the “significant challe nge [Commenter 0305] has made to EPA’s obligation to support its decision making with sound science.”

Response:

This comment urges EPA to address the issues raised by another commenter (0305). The various comments from this commenter (0305) are summarize d throughout this document. EPA has responded

to all comments in this document. Our final determin ation is based on the analyses presented in this response to comment document and supporting info rmation, as well as our Proposed Rule and Supplemental Proposal.

388 See Proposed Rule at 78 FR 8275 (February 5, 2013).Page 245

EPA Responses to Comments: Navajo Gene rating Station Final Rule | July 28, 2014 Comment: Bituminous coal at FCPP

One individual (0157) stated th at BHP coal has always been thought of as sub-bituminous, but it is actually bituminous. Citing “Determination of Four Corner s Coal Ranking, March 11, 2008, Alan Papp, (Borrowing Heavily from the work of Dave Bi ser; and attached to the docket), the commenter asserted that the report details the misuse of a fo rmula where the formula requires percent to be entered,

but instead decimals were entered resulting in a lower Btu/lb for Four Corners Coal. Commenter stated that this report says the FCPP has been burning bituminous coal instead of sub-bituminous and only paying for sub-bituminous prices. Commenter believed th e Navajo Nation has been cheated of $1 billion of coal royalties since the creation of Navajo Mine and that the Stat e of Arizona has been missing out on taxes from the extra energy created all these years.

Response:

Although EPA has included a summary of this comment in this response to comment document, this comment is not related to NGS, the Kayenta Mine, which supplies coal to NGS, or our proposed BART determination for NGS. Therefore, EPA is not providing a response to this comment.

Comment: No 111(d) authority to regulate CO 2 at existing power plants

One industry/commerce commenter (0325) pres ented arguments that EPA does not have authority under CAA section 111(d) to adopt CO 2 performance standards for existing coal-fired EGUs that are so stringent as to force plant retirements or curtailments.

Response:

This comment is beyond the scope of this rulemaking. EPA has a separate, national rulemaking process for implementing regulati on of greenhouse gases, including CO 2 from coal-fired EGUs. The action EPA is taking here has a narrow sc ope and does not impose any regulation on CO 2 or any greenhouse gases from NGS.Page246EPA Responses to Comments: Navajo Generating Station Final Rule | July 28, 2014Appendix A: List of Written Comments389DocumentIDaTitle Type of Commenter Notes0015Comment on FR Doc # 2013-01858:Arizona Interfaith Powerand LightEnvironmental/PublicInterest Advocacy Group0016Comment from webmail dated 1-26-2013 from PatrickMattinglyPrivate Individual0017Comment letter dated 1-30-2013 from Bob Stump, Chairman,Arizona Corporation Commission (ACC)State/Local GovernmentSame entity as0289/03200018Comment letter dated 2-13-2013 from David Mallavia,President of Canyonlands Health CareIndustry/Commerce0019Comment letter dated 2-13-2013 from Grant R. Ward,Maricopa-Stanfield Irrigation and Drainage DistrictCAP Water InterestGroupSame entity as 00600020 Comment letter dated 2-13-2013 fromSylvia Colton Private Individual0021Comment submitted through webforms, dated 2-14-2013, fromW.B. "Tug" KangusPrivate Individual0022Comment letter dated 2-14-2013 from Kelly Barr, Salt RiverProjectIndustry/CommerceSame entity as0264.2/0268/0348/0417; referred to as03480023Comment letter dated 2-21-2013 from Central Arizona WaterConservation District(CAWCD), David ModeerCAP OperatorSame entity as0250/0257/0343;referred to as 034300242013_0301 Navajo Nation Request for 90-day Extension ofComment PeriodTribal Government Same entity as0098/0316/0326;referred to as 0316389Appendix A: List of Comments represents all documents that are labeled as “Comments” in the docket (at EPA-R09-OAR-2013-0009).However. as noted inAppendix A, not all documents are comments (e.g., in some cases documents generated by EPA, such as memos to file, were inadvertently posted and labeled as“comments”), not all comments included attachments, and some comments are duplicated. EPA has included a separate column, titled “Notes” to provideclarification, as needed.Page247EPA Responses to Comments: Navajo Generating Station Final Rule | July 28, 2014Appendix A: List of Written Comments389DocumentIDaTitle Type of Commenter Notes0025Comment Letter Dated March 4,2013 from Vincent Yazzie(commenter submitted multiple further comments and/orattachments to the docket under document IDs 0041, 0071,0072, 0124, 0125, 0126, 0130, 0131, 0135, 0136, 0139, 0153,0154, 0155, 0156, 0157, 0158, 0171, 0267, 0269, 0355; forclarity, all comments are identified in the RTC as: 0025/0***)Private Individual0026Comment submitted through Regulations.gov on 3-9-13 fromAndrew KeyPrivate Individual0027Comment submitted through Regulations.gov on 3-9-13 fromShawn DolanIndustry/Commerce0036 Comment from Dave Crawford on FR Doc # 2013-01858Private Individual0037Comment from Hitachi PowerSystems America on FR Doc #2013-01858Industry/Commerce Catalyst vendor0038 Comment from Jean Miyake received March 10, 2013 Private Individual0039Comment from Governor Gregory Mendoza, Gila River IndianCommunity, received March 11, 2013Tribal Government0040 Comment from Keith Woodward received Marcy 13, 2013Private Individual0041 Comment from Vincent H. Yazzie received March 12, 2013Private Individual0042 Comment from James Drake received March 14, 2013Private Individual0043 Comment from Duncan Harvey received March 15, 2013Private Individual0044 Comment from David Becker received March 16, 2013Private Individual0045Comment from Paula Smith received March 16, 2013 Private Individual0046Comment from Barbara J. Sattler received March 25, 2013(dated March 19, 2013)Private Individual0047Comment on FR Doc # 2013-01858 Private Individual0048Comment on FR Doc # 2013-06196 Private Individual0049Comment on FR Doc # 2013-01858 Private Individual0050Comment on FR Doc # 2013-06196 Private Individual0051Comment from Cindy Siepel dated April 5, 2013 via email.Private IndividualPage248EPA Responses to Comments: Navajo Generating Station Final Rule | July 28, 2014Appendix A: List of Written Comments389DocumentIDaTitle Type of Commenter Notes0052Comment letter from Sundt Construction Inc. David S.Crawford, P.E. dated April 8, 2013.Industry/Commerce0053Comment from Brian D. Gary, BS Geological EngineeringStudent, dated April 9, 2013 via email.Private Individual0054Comment from Jon Borges, L.M.P. dated April 9, 2013 viaemail.Private Individual0055Comment from John Neville, LEED-AP, President ofSustainable Arizona, dated April 12, 2013.Environmental/PublicInterest Advocacy Group0056 Comment from Janice Berger, dated April 14, 2013, via email. Private Individual0057Comment from Sid Abma, Sidel Systems, dated April 15, 2013,via email.Industry/Commerce0058Comments (4) from WildEarth Guardians (WEG), dated April15, 2013, via emails.Environmental/PublicInterest Advocacy GroupMass CommentCampaign Email_WildEarth0059Comment (1) from WildEarth Guardians (WEG), dated April16, 2013, via email.Environmental/PublicInterest Advocacy GroupMass CommentCampaign Email_WildEarth00602013_0311 Meeting materials from Maricopa StanfieldIrrigation DistrictCAP Water InterestGroupThis docket item inSupporting &Related Materials0064Comment on FR Doc # 2013-01858Private Individual0065Comment from Scott Hicks, dated May 5, 2013, on FR Doc #2013-01858Industry/Commerce0066Comment from Concerned Individual on FR Doc # 2013-01858Private Individual0067Comment from Christopher Lish, May 6, 2013, on FR Doc #2013-01858Private Individual Includes contentsimilar to 0120 &0385Page249EPA Responses to Comments: Navajo Generating Station Final Rule | July 28, 2014Appendix A: List of Written Comments389DocumentIDaTitle Type of Commenter Notes0068Comment (1), April 17, 2013, from Malcolm Brown, viaWildEarth Guardians.Private IndividualMass CommentCampaign Email_WildEarth0069 Comment from Dennis Lemon, May 2, 2013. Private Individual0070Comment from Patricia Alvarez, May 2, 2013, on FR Doc #2013-06196Private Individual0071Comment from Vincent Yazzi, May 6, 2013 letter with 13 filesattachedPrivate Individual0072 Comment from Vincent Yazzi, May 9, 2013 letter with 2 files Private Individual0074 Comment, 2013-0430 from Kenneth KovovichPrivate Individual0075 Comment, 2013-05-02 from Patricia AlvarezPrivate Individual0076 Comment, 2013-05-06from Steve RasmussenIndustry/CommerceIdentical to 00270077 Comment, 2013-05-08from Joseph RoundtreePrivate Individual0078 Comment, 2013-05-08 from Thomas PyzdekPrivate Individual0079 Comment, 2013-05-09 from Ann McMullenPrivate Individual0080 Comment, 2013-05-09 R WadePrivate Individual0081 Comment, 2013-05-10from Lee CalamaioPrivate Individual0082Comment from AZ House of Representatives on 5/29/13 on FRDoc # 2013-06196Elected Officials0083Comment from Roger Moder on 5/31/2013 on FR Doc # 2013-06196Private Individual Same commenter as0276; referred to as00830084Comment from Rick Murray, AZ Small Business Association,June 4, 2013, on FR Doc # 2013-06196Industry/Commerce0085Comment from Senator Steve Pierce, AZ State Senate, June 4,2013, on FR Doc # 2013-06196Elected Official0086Comment from Concerned Individual, June 4, 3013, on FR Doc# 2013-06196Private Individual0087 2013_0307 Letter from Senators Flake andMcCain on NGS Elected OfficialsPage250EPA Responses to Comments: Navajo Generating Station Final Rule | July 28, 2014Appendix A: List of Written Comments389DocumentIDaTitle Type of Commenter Notes0088 2013_0508 Comment from Wayne Collins Private Individual00892013_0515 Letter from Membersof the AZ House ofRepresentativesElected Officials Duplicate of 00820090 2013_0524 Comment from Frank Jones Private Individual0091 2013_0604 Comment from Roger Turner Private Individual00952013_0528 Letter from Tom Horne, AZ Attorney Gen. ANDEPA Response to letter dated June 6, 2013State/Local Government0097 2013_0606 Letter from NV State Senator Kelvin Atkinson Elected Official00982013_0611 Letter from PresidentShelly, Navajo Nationrequesting consultation meetingTribal Government Same entity as0024/0316/0326;referred to as 03160099 2013_0616 Email comment from Susan and JohnPrivate Individual01022013_0620 Stakeholder Request for Additional Extension ofComment PeriodTechnical Work Group Same entity as0313/0418; referredto as 03130104 2013_0612 Letter from AZ State Senate President Biggs Elected Official0105 2013_0613 Letter from AZ State Rep.Kavanagh Elected Official0106 2013_0625 Comment from Verna Stoddard Private Individual0109 2013_0702 Email Comment from John Yoder Private Individual0112Comment from Member of Navajo Tribe on FR Doc # 2013-14630 dated 7/7/13Private Individual0113Comment from Rick Spilsbury on FR Doc # 2013-14630 dated7/10/13Private Individual0114Anonymous Comment on FR Doc # 2013-14630 dated7/12/13 Private Individual Mass CommentCampaign Email_Sierra Club0115 Anonymous Comment on FR Doc # 2013-06196 dated 7/2/13 Private Individual0116Anonymous #2 Comment on FR Doc # 2013-06196 dated7/2/13Private IndividualPage251EPA Responses to Comments: Navajo Generating Station Final Rule | July 28, 2014Appendix A: List of Written Comments389DocumentIDaTitle Type of Commenter Notes0117Anonymous #3 Comment on FR Doc # 2013-06196 dated7/2/13Private Individual0119 2013_0717 Comment from Alvern Woods Private Individual01202013_0713 Example Take Action Email from Sierra Club (over36,000 received as of 7/26/13)Environmental/PublicInterest Advocacy GroupMass CommentCampaign Email_Sierra Club01212013_0724 Example Take Action Email from Care2 (over 5,900received as of 7/26/13)Environmental/PublicInterest Advocacy GroupMass CommentCampaign Email_Care2 (Identical tothe “Take Action”email submitted bySierra Club)0123 COMMENT from Fred Bauder, 7-29-13, via email Private Individual0124 COMMENT from Vincent Yazzie, 7-29-13, via email Private Individual0125 COMMENT #2 from Vincent Yazzie, 7-29-13, via email Private Individual0126 COMMENT #3 from Vincent Yazzie, 7-29-13, via email Private Individual0127 COMMENT from Val Summers, 8-03-12, via email Private Individual0128 COMMENT from Terry L. O'Neal, letter dated August 6, 2013 Private Individual0129 COMMENT from Terry Finefrock, 8-07-13, viaemail Private Individual Included in 02480130 COMMENT from Vincent Yazzie, 8-09-13, via email Private Individual0131 COMMENT from Vincent Yazzie, 8-10-13, via email Private Individual0132 COMMENT from L.S. Willingyrme, M.D.,8-12-13, via email Private Individual0133 COMMENT from Paul Mitchell, 8-16-13, viaemail Private Individual (partial)0134COMMENT from LeRoy Shingoitewa, Chairman, The HopiTribe, letter dated August 19, 2013Tribal Government Same entity as0323/0333/0359;referred to as 01340135COMMENT from Vincent Yazzie, dated August 4, 2013,received in email August 5, 2013, with attachmentsPrivate IndividualPage252EPA Responses to Comments: Navajo Generating Station Final Rule | July 28, 2014Appendix A: List of Written Comments389DocumentIDaTitle Type of Commenter Notes0136COMMENT from Vincent Yazzie, dated August 14, 2013,received in email August 14, 2013, with attachmentsPrivate Individual0137 Comment on EPA-R09-OAR-2013-0009-0029 Private Individual0138 Comment on EPA-R09-OAR-2013-0009-0029 Private Individual0139 Comment from Vincent Yazzie, August 26, 2013, via email Private Individual0140Comment from Joe Galli with Scottsdale Chamber ofCommerce, dated August 27, 2013Industry/Commerce0141Comment from Joe Galli, Scottsdale Chamber of Commerce onEPA-R09-OAR-2013-0009-0111Industry/Commerce Duplicate of 01400142COMMENT from Dave Hummer, Mining Engineer,Department of the Interior, Office of Indian Energy andEconomic Development, August 22, 2013, via email.Federal Agency0145Comment from Carrie Wilkinson, 9-11-13, on EPA-R09-OAR-2013-0009-0111Private Individual0146Comment from Kathy Jirschele, 9-11-13, on EPA-R09-OAR-2013-0009-0111Private Individual Identical to 01450147Comment from Malcolm Cox, 9-11-13, on EPA-R09-OAR-2013-0009-0111Private Individual Identical to 01450148Comment from Lindsey Normoyle, 9-11-13, on EPA-R09-OAR-2013-0009-0111Private Individual Identical to 01450149Comment from Tracy Scheinkman, 9-11-13, on EPA-R09-OAR-2013-0009-0111Private Individual01532013_0829 Comment from Vincent Yazzie, dated August 29,2013 via emailPrivate Individual01542013_0830 Comment from Vincent Yazzie, dated August 30,2013, via emailPrivate Individual01552013_0831 Comment from Vincent Yazzie, dated August 31,2013, via emailPrivate IndividualPage253EPA Responses to Comments: Navajo Generating Station Final Rule | July 28, 2014Appendix A: List of Written Comments389DocumentIDaTitle Type of Commenter Notes01562013_0902 Comment from Vincent Yazzie, dated September 2,2013Private Individual01572013_0906 Comment from Vincent Yazzie, dated September 6,2013Private Individual01582013_0909 Comment from Vincent Yazzie, dated September 9,2013Private Individual0159 2013_0826 Comment Letter from Arizona Power AuthorityState/Local Government0160 2013_0910 Comment from Craig Weatherford via email Private Individual0161 2013_0910 Comment from Justin Elder via email Private Individual Identical to 01450162 2013_0910 Comment from Rob Rauh via email Private Individual01632013_0910 Comment from Ted Falkowski via email Private Individual Some contentidentical to 01450164 2013_0910 Comment from Mark Shaw via email Private Individual01652013_0914 Comment from Mike Fisher on EPA-R09-OAR-2013-0009-0111Private Individual Essentiallyidentical to 01450167 2013_0912 Comment from Rebecca Schlofner Private Individual Identical to 014501682013_0912 Comment from George DuffieldPrivate Individual Essentiallyidentical to 01450169 2013_0913 Comment from Bill Ahlbrandt Private Individual0170 2013_0913 Comment from Su Story Private Individual0171 2013_0916 Comment Vincent Yazzie Private Individual0175 Comment from Linda Kavanagh, Mayor of Fountain Hills, AZ State/Local Government01762013_0903 Comment from Bruce Hamblin, Mayor of Eagar,and other elected officialsState/Local Government0177 2013_0912 Comment from Christopher Thunberg Private Individual0178 2013_0918 Comment from Aaron Lenzing Private Individual0179 2013_0918 Comment from R. Grim Private Individual0180 2013_0920 Comment from Julia Larrabee Private IndividualPage254EPA Responses to Comments: Navajo Generating Station Final Rule | July 28, 2014Appendix A: List of Written Comments389DocumentIDaTitle Type of Commenter Notes0181 2013_0923 Comment from NikolaiMessner Private Individual0187 Comment from Christopher Lish Private Individual Duplicate of 00670188Comment from Todd Sanders, Greater Phoenix Chamber ofCommerceIndustry/Commerce0189 Comment from Sal deCiccio, Phoenix City Council State/Local Government0190Comment from BinnurGunesin via regulations.gov Industry/Commerce0192Comment from Mayor of Oro Valley Arizona, Satish I.Hiremath, September 18, 2013.State/Local GovernmentNo attachment –reposted at 04430193Comment from Harrison and Mary Johnson, September 23,2013.Private Individual Identical to 01450194Comment from Flowing WellsIrrigation District, DavidCrockett, September 23, 2013.CAP Water InterestGroupSome contentidentical to 01450195Comment from Anita Christy, Arizona for Water, September 25,2013.Private Individual0196Comment from BinnurGunesin,Dutoit/Gunesin CS, September25, 2013.Industry/Commerce Duplicate of 01900197 Comment from JojeanDikeman, September 26, 2013. Private Individual0198Comment EXAMPLE of 11 form letters received September 27,2013.Private IndividualMass CommentCampaign Letter;duplicate of 01200199Comment from City of Chandler Arizona, Mayor JayTibshraeny, September 26, 2013.State/Local Government0200Comment from Richard B. and Kathleen H. Coolidge, October2, 2013.Private Individual Identical to 01450201Comment from City of GoodyearArizona, Mayor Georgia Lord,October 3, 2013.State/Local Government0202 Comment from Mark Shaw, October 7, 2013. Private Individual0203Comment from Rod and Rhonda Lucas, October 3, 2013.Private Individual Essentially identical0145Page255EPA Responses to Comments: Navajo Generating Station Final Rule | July 28, 2014Appendix A: List of Written Comments389DocumentIDaTitle Type of Commenter Notes0204Comment from James Orcutt, October 7, 2013.Private Individual Some content isidentical to 01450205 Comment from Don Blume, October 4, 2013.Private Individual Identical to 01450206 Comment from Karen Lowe, October 9, 2013. Private Individual0207Comment from City of El Mirage Arizona, Mayor Lana Mook,October 10, 2013.State/Local Government Some contentidentical to 01450208Comment from Lisa A. Atkins, October 10, 2013. Private Individual Some content isidentical to 01450209Comment from Thomas J. Lowe,Chairman of Univest, October10, 2013.Private Individual0210Comment from Jeff Strang, October 11, 2013.Private Individual Some content isidentical to 01450211 Comment #1 from Arlene Alder, October 12, 2013. Private Individual0212Comment #2 from Arlene Alder, October 12, 2013. Private Individual Essentiallyidentical to 01450213Comment from City of LitchfieldPark Arizona, Mayor ThomasSchoaf, October 15, 2013.State/Local Government0214Comment from Metro WaterDistrict, Tucson Arizona,Chairwoman, Judy Scrivener, October 16, 2013.CAP Water InterestGroupSome contentidentical to 01450215 Comment from Terry Carleton, October 16, 2013. Private Individual0216 Comment from Maria Randklev, October 17, 2013. Private Individual0217 Comment from Shaina Shay, October 17, 2013. Private Individual0218 Comment from Chuck Gordon, October 23, 2013. Private Individual0220Comment thru Regulations.gov from Councilman Jim Waring,City of Phoenix, October 4, 2013, on EPA-R09-OAR-2013-0009-0186State/Local Government0221Comment thru Regulations.gov on EPA-R09-OAR-2013-0009-0186Private IndividualPage256EPA Responses to Comments: Navajo Generating Station Final Rule | July 28, 2014Appendix A: List of Written Comments389DocumentIDaTitle Type of Commenter Notes0222Comment thru Regulations.gov on EPA-R09-OAR-2013-0009-0186Private Individual0223Comment from Andy Tobin, Speaker of the House, thruRegulations.gov on EPA-R09-OAR-2013-0009-0186Elected Official Duplicate of 04460224Comment thru Regulations.gov on EPA-R09-OAR-2013-0009-0186Private Individual0225Comment thru Regulation.gov from Joe Galli, North ScottsdaleChamber of Commerce, August 28, 2013Industry/Commerce Duplicate of 01400226Comment thru Regulation.gov from Carrie Wilkinson,September 11, 2013.Private Individual Identical to 01450227 Comment thru Regulation.gov from Tracy Scheinkman Private Individual Duplicate of 01490228Comment in letter/email from taxpayers from Arizona, Thomasand Anita Christy, November 11, 2013.Private IndividualNo commentattached to thisdocument. See03770229 Comment from Kimberli Lee via email,November 4, 2013. Private Individual0230 Comment from Sandi Bartlett via email, November 6, 2013. Private Individual0231Comment from Merrianne Geisdorf via email, November 7,2013.Private IndividualIdentical to 02300232Comment from John Brakeman via email, November 8, 2013. Private Individual Some contentidentical to 01450233 Comment from Joy Staveley via email November 13, 2013. Private Individual0234Comment from Julie Pastrick, Flagstaff Chamber of Commerce,sent by Mike Sistak via email, November 13, 2013.Industry/Commerce0235 Comment from Mike Campbell via email, November 13, 2013. Private Individual0236 Comment from Charles Parke via email, November 14, 2013. Private Individual0237Comment from Dr. Kenneth Langton via email, November 14,2013.Private Individual0238 Comment from Lori Girshick via email, November 14, 2013. Private IndividualPage257EPA Responses to Comments: Navajo Generating Station Final Rule | July 28, 2014Appendix A: List of Written Comments389DocumentIDaTitle Type of Commenter Notes0239Comment from Senator Bob Worsley via email, November 14,2013.Elected Official0240Comment from Cathy Della Penta via email, November 15,2013.Private Individual0241 Comment from SPierce via email, November 16, 2013. Private Individual0242 Comment from Will Hodges via email, November 16, 2013. Private Individual0243 Comment from William Erb via email,November 17, 2013. Private Individual0244 Comment from Robert Tang via email, November 18, 2013. Industry/Commerce0245 Comment from Jack Utter via email,November 19, 2013. Private Individual0246Comment from Kendall Stephenson received via email,2013_1108Private Individual0247 Comment from Stacy Brimhall received via email, 2013_1108 Private Individual0248 Comment from Terry Finefrock received viaemail, 2013_1111 Private Individual Includes 01290249Comment from G. Brad Brown, Peabody Energy, at TucsonHearingIndustry/Commerce Same entity as0255/0384; referredto as 03840250Comment from David Modeer, General Manager, CentralArizona Conservation Water District, Central Arizona Project,November 15, 2013 at Tucson Hearing.CAP Operator Same entity as0023/0257/0343;referred to as 03430251 Comment from J. J. Riley atTucson Hearing Private Individual0252Comment from Chris E. Ward, President, Southern ArizonaWater Users Association at Tucson HearingCAP Water InterestGroupSome contentidentical to 01450253Comments from Tucson Hearing:2 single page comments, fromMelissa Donovan and Lea Marquez PetersonPrivate Individual0254Comment from Bret Fanshaw, Environment Arizona, at PhoenixHearing, November 14, 2013Environmental/PublicInterest Advocacy Group0255Comment from G. Brad Brown, Peabody Energy at PhoenixHearingIndustry/Commerce Same entity as0249/0384; referredto as 0384Page258EPA Responses to Comments: Navajo Generating Station Final Rule | July 28, 2014Appendix A: List of Written Comments389DocumentIDaTitle Type of Commenter Notes0256Comment from the Town of Cave Creek, Arizona, at thePhoenix HearingState/Local Government Resolution0257Comment from David Modeer, General Manager, CentralArizona Water Conservation District at Phoenix HearingCAP Operator Same entity as0023/0250/0343;referred to as 03430258Comment from Gail Griffin, State Senator, representingSoutheast Arizona, at Phoenix HearingElected Official0259Comment from Dr. George D. Thurston, Professor ofEnvironmental Medicine at the New York School of Medicine atthe Phoenix Hearing, November 14, 2013Private IndividualAuthor of a studysubmitted withEarthjustice 03730260Comment from Mark Hajduk, Environmental Consultant,Arizona Public Service Company at the Phoenix HearingIndustry/Commerce Same entity as0315; referred to as03150261Comment from Marshal Johnson, Photos, at the PhoenixHearingPrivate Individual0262Comment from Dr. Roger H. Bezdek, President of MISI, at thePhoenix Hearing November 14, 2013Private Individual Author of a studysubmitted withPeabody 03840263Comment from William Mattingly,Utilities Director, City ofPeoria AZ, at the Phoenix Hearing, November 14, 2013State/Local Government0264bComments-8 single pages from various speakers at the PhoenixHearing0264.1 Comment from Ed S. at the Phoenix HearingPrivate Individual0264.2Comment from Kelly Barr at thePhoenix Hearing Industry/CommerceSame entity as0022/0268/0348;referred to as 03480264.3 Comment from Jack Hamblet at the Phoenix HearingPrivate Individual0264.4 Comment from Gregory O’Reilly at the Phoenix HearingPrivate Individual0264.5 Comment from Liz Houricanat the Phoenix HearingPrivate IndividualPage259EPA Responses to Comments: Navajo Generating Station Final Rule | July 28, 2014Appendix A: List of Written Comments389DocumentIDaTitle Type of Commenter Notes0264.6 Comment from Liz Houricanat the Phoenix HearingPrivate Individual0264.7 Comment from Paul Bott at the Phoenix HearingPrivate Individual0264.8 Comment from Kathy Walsh at the Phoenix HearingPrivate Individual0265 Comment from Eugene T. Begay atthe Page Hearing Private Individual0266Comment from Professor Frank Clemente, Penn StateUniversity, at the PageHearing, November 12, 2013Private Individual0267 Comment from Vincent Yazzie, Photos, atthe Page Hearing Private Individual0268Comment from Mike Hummel, SRP Associate GeneralManager, at the LeChee HearingIndustry/Commerce Same entity as0022/0264.2/0348/0417; referred to as03480269 Comment from Vincent Yazzie - Photos atthe LeChee Hearing Private Individual0270Comment from Frank Clemente, Professor Emeritus at PennState University, at the Kykotsmovi HearingPrivate Individual Duplicate of 02660271Comment from Vernon Masayesva,Black Mesa Trust, at theKykotsmovi HearingEnvironmental/PublicInterest Advocacy GroupDuplicate of 04070272 Comment from Chet Haryasz Private Individual0273 Comment from Jim Newton Private Individual0274 Comment from Ralph Marra,BKW Farms Industry/Commerce0275 Comment from John Morgan Private Individual0276Comment from Roger Moder Private IndividualSame commenter as0083; referred to as00830277Comment from Karen JohnsonPrivate Individual Former StateSenator0278Jeff Jensen, Golf Course Superintendents Association ofAmerica, letter dated November 15, 2013Industry/Commerce Essentiallyidentical to 0145Page260EPA Responses to Comments: Navajo Generating Station Final Rule | July 28, 2014Appendix A: List of Written Comments389DocumentIDaTitle Type of Commenter Notes0279Comment from Zak Draskovich, dated November 21, 2013 Private Individual Mass CommentCampaignLetter_"Taxpayerfrom AZ"0280Comment from Christian Prive, Mayor of Maricopa, letter datedNovember 21, 2013State/Local Government0281Comment from Vernon Masayesva from Kykotsmovi Hearing,November 13, 2013Private Individual0282Comment from Peoria Chamber of Commerce, BobbiMagdaleno, ChairIndustry/Commerce0283 Comment from Peggie Jo Vincent,November 15, 2013 Private Individual0284 Comment from Dennis DuVall, November 14, 2013 Private Individual0285Comment from Andy M. Tobin, Speaker, AZ House ofRepresentative, letter dated November 13, 2013Elected OfficialNo commentattached, see 04460286Comment from William A. Rigsby, letter dated November 12,2013Private Individual Mass CommentCampaignLetter_"Taxpayerfrom AZ"0287Comment from Judy Burges, AZState Senate, November 12,2013Elected Official Some contentidentical to 01450288 Comment Robert E. Rutkowski, dated November 12, 2013 Private Individual0289Comment from Arizona Corporation Commission, Bob Stump,Chairman, November 5, 2013State/Local Government Same entity as0017/03200290 Comment from Art Felsinger and Paul Bott Private Individual0291Comment from Marcus D. Martin, October 25, 2013 Private Individual Mass CommentCampaignLetter_"Taxpayerfrom AZ"0292 Comment from James Shlenvogt, October 24, 2013 Private IndividualPage261EPA Responses to Comments: Navajo Generating Station Final Rule | July 28, 2014Appendix A: List of Written Comments389DocumentIDaTitle Type of Commenter Notes0293Comment from City of Gilbert,John W. Lewis, Mayor, October24, 2013State/Local Government0294Comment EXAMPLE of 82 comment cards from Black MesaWater Coalition, October 2013Environmental/PublicInterest Advocacy GroupMass CommentCampaign0295Comment from City of Scottsdale Arizona, W.J. "Jim" Lane,Mayor, October 23, 2013State/Local Government0296Comment from City of GlendaleArizona, Brenda S. Fishcer,City Manager, October 23, 2013State/Local Government0297Comment from State of Arizona, Janice K. Brewer, Governor,October 21, 2013State/Local Government0298 Comment from Dan Spacek, December 14, 2013 Private Individual0299Comment on EPA-R09-OAR-2013-0009-0186Private Individual0300Comment on EPA-R09-OAR-2013-0009-0186;AZ House ofRepresentatives Majority LeaderElected Official0304Comment on EPA-R09-OAR-2013-0009-0186, Dave Perry,President, Greater Oro Valley Chamber of CommerceIndustry/Commerce0305Comment on EPA-R09-OAR-2013-0009-0186 Task Force 01-06-2014, Grant Ward and Paul Orme SubmittersCAP Water InterestGroup0306Comment letter dated January6, 2014 from AZ MiningAssociation, Kelly Norton, President, with attachment, "TheNGS Battle" dated October 2013,Industry/Commerce Supports 03840307Comment from Carol W.West, November 26, 2013Private Individual0308Comment from Rory Van Poucke, December 4, 2013Private Individual0309Comment from Daryl P. Rachey, December 6, 2013Private Individual Mass CommentCampaignLetter_"Taxpayerfrom AZ"0310Comment from Brian Stevens, December 8, 2013Private IndividualPage262EPA Responses to Comments: Navajo Generating Station Final Rule | July 28, 2014Appendix A: List of Written Comments389DocumentIDaTitle Type of Commenter Notes0311Comment from Eric Hayes, December 8, 2013Private Individual Mass CommentCampaignLetter_"Taxpayerfrom AZ"0312Comment from Steven and Joan Harris, December 8, 2013Private Individual0313Comment from TWG to JaredBlumenfeld, RA, USEPA R9,dated January 6, 2014Technical Work Group Same entity as0120/0418; referredto as 03130314Comment from Tucson Electric Power (TEP), Mark Mansfield,Vice President, Generation, dated January 6, 2014Industry/Commerce Co-owner of NGS0315Comment from Arizona Public Service (APS), Chas Spell,Director of Environmental Policy Program, dated January 6,2014Industry/Commerce Co-owner of NGS0316Comment from Navajo Nation, Ben Shelly, President, January6, 2014Tribal Government Identical to 0326.Same entity as0024/0098/0326;referred to as 03160317Comment from Gila River Indian Community (GRIC), LinusEverling, dated January 2, 2014Tribal Government 0397 is a duplicate0318Comment from David M. Gowan, Sr., House Majority Leader,Arizona House of Representatives, December 9, 2013Elected Officials Duplicate of 03000319Comment from Deborah Maust, December 9, 2013Private Individual Mass CommentCampaignLetter_"Taxpayerfrom AZ"0320Comment from Arizona Corporation Commission (ACC),January 6, 2014State/Local Government State public utilityregulatory agency;Same entity as0017/0289Page263EPA Responses to Comments: Navajo Generating Station Final Rule | July 28, 2014Appendix A: List of Written Comments389DocumentIDaTitle Type of Commenter Notes0321Comment from Jeff McIntyre, Special Education Counselor,Page High School, December 9, 2013Private Individual0322Comment from Monica Kloskowski, December 9, 2013Private Individual Mass CommentCampaignLetter_"Taxpayerfrom AZ"0323Comment from Herman G. Honarie, Chairman, The Hopi Tribe,December 9, 2013Tribal Government Same entity as0134/0333/0359;referred to as 01340324Comment from Duane Blumberg, Ph.D., Mayor, Town ofSahuarita, December 10, 2013State/Local Government Essentiallyidentical to 01450325Comment from Arizona Coalition for Water, Energy, Jobs TomDorn, dated January 6, 2014Industry/Commerce Primarily addressesCO20326Comment from 22nd Navajo Nation, Honorable Johnny Naize,January 6, 2014Tribal Government Identical to 0316.Same entity as0024/0098/0316;referred to as 03160327Comment from Donald Begalke, December 12, 2013Private Individual0328Comment from Mark Mitchell, Mayor, City of Tempe,December 13, 2013State/Local Government0329Comment from Mary Worman, December 13, 2013Private Individual0330Comment from Mike Dvorak, December 13, 2013Private Individual0331Comment from James Terwilliger, December 14, 2013Private Individual0332Comment from Arizona Congressional Delegation, submitted byKris Kiefer (Flake), December 16, 2013Elected Officials0333Comment from Herman Honanie, Chairman of The Hopi Tribe,December 16, 2013Tribal Government Same entityas0134/0323/0359;referred to as 0134Page264EPA Responses to Comments: Navajo Generating Station Final Rule | July 28, 2014Appendix A: List of Written Comments389DocumentIDaTitle Type of Commenter Notes0334Comment from Ronnie Lupe, Chairman, White MountainApache Tribe, December 17, 2013Tribal Government Not a comment;duplicate of 03370335Comment from Charles Spitzer, December 21, 2013Private Individual0336Response letter from Jared Blumenfeld, EPAR9, RA, to HermanG. Honanie, Chairman of the Hopi Tribe, December 24, 2013,resulting from government-to-government consultation ofDecember 9, 2013Federal Agency Not a comment0337Letter from Jared Blumenfeld,RA, USEPA R9, to Ronnie Lupe,Chairman, White Mountain Apache Tribe, December 24, 2013,regarding the December 10, 2013 consultation meeting and theduration of the comment periodFederal Agency Not a comment0338Comment from Virgil W. Davis, Chairman of the Board,Community Water Company of Green Valley, December 27,2013CAP Water InterestGroup0339Comment from Dave Perry, President/CEO, Greater Oro ValleyChamber of Commerce, December 27, 2013Industry CommerceDuplicate of 03040340Comment from Tohono O'odham Nation, submitted by JonathanL. Jantzen, Office of AttorneyGeneral of the Tohono O'odhamNation, December 27, 2013Tribal Government0341Comment from Glenn Martin, December 30, 2013Private Individual0342Comment from Lee Beam, rePhotoBioReactor, December 30,2013Private IndividualNo commentattached, see 04470343Comment from Central ArizonaWater Conservation District(CAWCD), David Modeer, General Manager, dated January 6,2014CAP Operator Same entity as0023/0257/0343;referred to as 03430344Comment from Mary Ann Osterbrink, December 30, 2013Private Individual0345Comment from Charles Bliss,ChE, Oxyfuel Alternative,January 2, 2014Private Individual0346Comment from Dominic Bailin, January 3, 2014Private IndividualPage265EPA Responses to Comments: Navajo Generating Station Final Rule | July 28, 2014Appendix A: List of Written Comments389DocumentIDaTitle Type of Commenter Notes0347Comment from Arizona Department of Water Resources,Thomas Buschatzke, dated January 6, 2014State/Local Government0348Comment letter from SRP, Kelly J. Barr, with enclosuresseparately postedIndustry/Commerce Co-owner andoperator of NGS0349Comment from SRP, Appendices A-CIndustry/Commerce0348 appendices0350Comment from SRP, Appendices D-FIndustry/Commerce0348 appendices0351Comment from SRP, Appendices G-KIndustry/Commerce0348 appendices0352Comment from SRP, Appendices L-OIndustry/Commerce0348 appendices0353Comment from SRP, Appendices P-TIndustry/Commerce0348 appendices0354Comment from SRP, Appendices U-VIndustry/Commerce0348 appendices0355Comment from Vincent Yazzie, January 6, 2014Private Individual0356Comment from Don Yellowman, President, Forgotten PeopleCDC, January 3, 2014Environmental/PublicInterest Advocacy Group0357Comment from Douglas Dewitz, January 3, 2014Private Individual0358Comment from Nance Harris, January 3, 2014Private Individual0359Comment from Herman Honanie, Chairman, The Hopi Tribe,January 3, 2014Tribal Government Same entity as0134/0323/0333;referred to as 01340360Comment from James and Carolyn Shelton, January 4, 2014Private Individual0361Comment from Sarah Carignan, January 4, 2014Private Individual0362Comment from Dwight Witherspoon, Council Delegate for:Black Mesa Chapter, Forest Lake Chapter, Hardrock Chapter,Pinon Chapter, Wippoorwill Chapter, January 5, 2014State/Local Government0363Comment from Michael L. Weiss, January 6, 2014Private Individual0364Comment from Tracy Hiscock, January 5, 2014Private Individual0365Letter Response to Governor Janice Brewer, from AdministratorGina McCarthy, January 6, 2014Federal Agency Not a comment0366Comment from Bob and Karen LeCour, January 5, 2014Private IndividualPage266EPA Responses to Comments: Navajo Generating Station Final Rule | July 28, 2014Appendix A: List of Written Comments389DocumentIDaTitle Type of Commenter Notes0367Comments and Exhibits submitted by Earth Justice on behalf of"Conservations Organizations":National Parks ConservationAssociation, Sierra Club, Grand Canyon Trust and NationalResources Defense CouncilEnvironmental/PublicInterest Advocacy Group0373 attachments0368Comments and Exhibits submitted by Earth Justice on behalf of"Conservations Organizations":National Parks ConservationAssociation, Sierra Club, Grand Canyon Trust and NationalResources Defense Council: David Marcus, December 31, 2013Environmental/PublicInterest Advocacy Group0373 attachments0369Comments and Exhibits submitted by Earth Justice on behalf of"Conservations Organizations":National Parks ConservationAssociation, Sierra Club, Grand Canyon Trust and NationalResources Defense Council: George D. Thurston's Report,December 12, 2013Environmental/PublicInterest Advocacy Group0373 attachments0370Comments and Exhibits submitted by Earth Justice on behalf of"Conservations Organizations":National Parks ConservationAssociation, Sierra Club, Grand Canyon Trust and NationalResources Defense Council: Nathan Miller and Ranijit Sahu ,December 31, 2013Environmental/PublicInterest Advocacy Group0373 attachments0373Letter, January 3, 2014: Comments and Exhibits submitted byEarth Justice on behalf of "Conservations Organizations":National Parks Conservation Association, Sierra Club, GrandCanyon Trust and National Resources Defense CouncilEnvironmental/PublicInterest Advocacy Group0374Comments: Example of 728 emails from Environment ArizonaCampaign received 1-3-14Environmental/PublicInterest Advocacy GroupMass CommentCampaign_Environment AZPage267EPA Responses to Comments: Navajo Generating Station Final Rule | July 28, 2014Appendix A: List of Written Comments389DocumentIDaTitle Type of Commenter Notes0375Comments: Example of 1, 111 emails received by EPA fromCare2 Take Action Campaign, 1-6-14Environmental/PublicInterest Advocacy GroupMass CommentCampaign_ Care 2Take Action;duplicate ofcomment no. 01200376Comments: Example of 1,226 emails from Wild EarthGuardians received by EPA as of 1/6/14Environmental/PublicInterest Advocacy GroupMass CommentCampaign_WildEarth0377Comments: Example of 26 Similar Emails all containing"Taxpayer from AZ" in signature line received by EPA as of 1-6-14Private IndividualMass CommentCampaign"Taxpayer fromAZ"0378Comment from Dan Spacek, December 14, 2013Private Individual Mass CommentCampaign"Taxpayer fromAZ"0379Comment from Jim Staude, December 16, 2013Private Individual Mass CommentCampaign"Taxpayer fromAZ"0380Comments: Example of 114 Emails All With Identical SubjectLine received by 1-6-14Private Individual Mass CommentCampaign Email0381Comment from Pinal Partnership Board, Sandie Smith, CEO,dated 12-20-13Industry/Commerce0382Comment from Everett Rhodes, 12-23-13 Private Individual0383Comment from City of Phoenix, Water Services Department,Clifford A. Neal, P.E., Advisor, December 30, 2013State/Local Government0384Comment from Peabody Energy, Mary L. Frontezak, SeniorVice President and General Counsel Peabody, January 2, 2014Industry/Commerce Same entity as0249/0255Page268EPA Responses to Comments: Navajo Generating Station Final Rule | July 28, 2014Appendix A: List of Written Comments389DocumentIDaTitle Type of Commenter Notes0385Comments: Example of 35,293 letters from National ParksConservation Association CampaignEnvironmental/PublicInterest Advocacy GroupMass CommentCampaign Letter;variation of 01200386Comments: Example 38,365 emails from Sierra Club receivedby EPA as of 1-6-14Environmental/PublicInterest Advocacy GroupMass CommentCampaign Email; 2entries submitted,of which one is aduplicate of 01200387Comment from Ak-Chin Indian Community, Louis J. Manuel,Jr., Chairman, 1-6-14Tribal Government0388Comment from Allen Gilberg, January 6, 2014Private Individual0389Comment from Arizona Public Services (APS), Chas Spell,Director of Environmental Policies and Programs, January 6,2014Industry/CommerceSame commenter as0315; commentsnot attached0390Memo to File, 1-8-14, Anita Lee,re Comment attachments forV. Yazzie, January 6, 2014 submitted thru regulations.govFederal Agency Not a comment0391Comment from Arizona Corporation Commission submitted byMichele Finical, January 6, 2014Industry/Commerce Duplicate of 03200392Comment from Craig J. Sanderson, January 6, 2014Private Individual0393Comment from Dorothy Rl Yazzie, January 6, 2014Private Individual0394Comment from Ed Becenti, January 6, 2014Private Individual0395Comments from Western Resource Advocates andEnvironmental Defense Fund, January 6, 2014Environmental/PublicInterest Advocacy Group0396Comment from Frank Bain, January 6, 2014Private Individual0397Comment from Gila River Indian Community, letter datedJanuary 2, 2014, submitted by Linus Everling, January 6, 2014Tribal Government Duplicate of 03170398Comments from Irrigation and Electrical Districts Associationof Arizona, Robert S. Lynch, January 6, 2014CAP Water InterestGroupIncorporatescomments of 0305& 0343Page269EPA Responses to Comments: Navajo Generating Station Final Rule | July 28, 2014Appendix A: List of Written Comments389DocumentIDaTitle Type of Commenter Notes0399Comments from Leonard Gilmore, January 6, 2014Private Individual0400Comment from West Maricopa Coalition, WESTMARC,Michelle Rider, January 6, 2014Industry/Commerce Identical to 01450401Comment from San Juan Individuals Alliance, Mike Eisenfeld,January 6, 2014Environmental/PublicInterest Advocacy GroupSupports thecomments of 03730402Comments from Navajo Nation, Ben Shelly, President, January6, 2014Tribal Government Duplicate of 03160403Comment from Forgotten People,Fern, Mabelle and NormanBenally, Pauline Whitesinger, Vincent Yazzie, Bessie Wilson,Marsha Monestersky and Danny Blackgoat, submitted by S.D.Smith, January 6, 2014Environmental/PublicInterest Advocacy Group0404Comment from The Tax Payer Association of Kane County,submitted by Dr. Sky Chaney, January 6, 2014Environmental/PublicInterestAdvocacyGroup0405Comment from Susan Hand, January 6, 2014Private Individual0406Comment from Town of Marana AZ, John P. Kmiec, UtilitiesDirector, January 6, 2014State/Local Government Essentiallyidentical to 01450407Comment from Black Mesa Trust, Vernon Masayesva, Founderand Director of Black Mesa Trust, January 6, 2014Environmental/PublicInterest Advocacy GroupIdentical to 0271with addition of acover letter0408Comment from Arizona Department of Water Resources,submitted by Theresa Johnson, January 6, 2014State/Local Government Duplicate of 03470409Comment from Central Arizona Project Agricultural WaterUsers Navajo Generating Station Task Force, Van Smith,January 6, 2014Industry/Commerce Duplicate of 03050410Comment from Central ArizonaWater Conservation District,Jay M. Johnson, January 6, 2014Industry/Commerce Duplicate of 03430411Comment from United States Department of the Interior, AllettaBelin, January 6, 2014Federal AgencyPage270EPA Responses to Comments: Navajo Generating Station Final Rule | July 28, 2014Appendix A: List of Written Comments389DocumentIDaTitle Type of Commenter Notes0412Comment from Donna House, Member of Oak Springs Chapterof Navajo Nation, January 6, 2014Private Individual0413Comment from Black Mesa Water Coalition, Jihan Gearon,January 6, 2014Environmental/PublicInterest Advocacy Group0414Comment from Jim and Lora Gale, January 5, 2014Private Individual0415Comment from Lisa Rutherford, January 6, 20144Private Individual0416Comment from Water Resource Institute, L.L.C., Mark Lewis,January 6, 2014Industry/Commerce0417Comment from Salt River Project Agricultural Improvement andPower District (SRP), Kelly J. Barr, January 6, 2014Industry/Commerce Duplicate of 03480418Comments from Technical Work Group (TWG), submitted byKelly J. Barr, January 6, 2014Technical Work Group Duplicate of 03130419Comment from Tonto Apache Tribe and San Carlos ApacheTribe, submitted by Julia Rowen Kolsrud, January 6, 2014Tribal Government Supports thecomments of 04180420Comment of Navajo Nation Resolutions submitted by MarshallJohnson, January 6, 2014Tribal Government0421Comment from Kaibab Band of Paiute Indians, submitted byChairman Manuel M. Savala, January 6, 2014Tribal Government0422Comment from Lois McConville, December 16, 2013Private Individual Mass CommentCampaignLetter_"Taxpayerfrom AZ"0423Comment from Mike McConville, December 13, 2013Private Individual Mass CommentCampaignLetter_"Taxpayerfrom AZ"Page271EPA Responses to Comments: Navajo Generating Station Final Rule | July 28, 2014Appendix A: List of Written Comments389DocumentIDaTitle Type of Commenter Notes0424Comment example of 51 post cards received January 6, 2014Environmental/PublicInterest Advocacy GroupComment cards area variation ofcomment cardssubmitted by BlackMesa WaterCoalition, October2013; entry 02940431Comment from Steven and Joan Harris, December 8, 2013Private Individual0432Comment from Bob and Karen LeCour, January 5, 2014Private Individual0433Memo to File, January 28, 2014: Re: Electronic Mass MailComments Received, by Anita LeeFederal Agency Table from EPAoutlining/sortingMass Comments0434Comments, Unique Emails,Do Not Delay NGS CleanupCampaign, example dated December 19, 2013, from CarolineJohnsonPrivate IndividualMass CommentCampaign_Do NotDelay NGSCleanup0435Comments, Unique Emails, Clean Air for the Grand Canyon,Environment Arizona, example dated December 25, 2013, fromJane BeattiePrivate IndividualMass CommentCampaignEnvironmentArizona0436Comments, Unique Emailsfrom Sierra Club Campaign,example dated December 10, 2013, from John BrownePrivate Individual 416 entries/pages0437Comments, Unique Emails fromTaxpayers from AZ Campaign,example dated November 6, 2013, Alma EngelPrivate IndividualMass CommentCampaign"Taxpayer fromAZ"0438Comments, Unique Emails from Wild Earth GuardiansCampaign, example dated May 16, 2013, Mr. AJ AverettPrivate IndividualMass CommentCampaignWildEarthPage272EPA Responses to Comments: Navajo Generating Station Final Rule | July 28, 2014Appendix A: List of Written Comments389DocumentIDaTitle Type of Commenter Notes0439Comment, Unique Letters from NPCA Campaign, exampledated June 11, 2013, Mr. Thomas FrenchPrivate Individual 296 entries/pages.Mass CommentCampaign_NPCA0440Comment from the White Mountain Apache Tribe, submitted byChairman Ronnie Lupe dated February 5, 2014Tribal Government0441Postcard Comments from 48 Individuals postmarked January 6,2014Private Individuals Mass Commentcampaign identicalto 02940442Late Postcard Comments from 58 Individuals postmarkedJanuary 7, 2014Private Individuals Mass Commentcampaign identicalto 02940443Re-Posting to Add Missing Attachment from Document Number0192: Comment from Mayor of Oro Valley, AZ, Satish I.Hiremath dated September 18, 2013Government – Local Originally postedwithout attachmentat 01920446Re-posting to attach missingfile for comment number 0285:Comment from Andy Tobin, Speaker, AZ House ofRepresentatives dated November 13, 2013Government – State Originally postedwithout attachmentat 02850447Re-posting to attach missingfile for comment number 0342:Comment from Lee Beam, re:PhotoBioReactor, December 30,2013Individual Originally postedwithout attachmentat 0342aDocument ID identifies written comments foundin Docket No. EPA-R09-OAR-2013-0009 by document number.bDocument No. 0264 was uploaded on the Docketas one comment, although it is a compilation of eight differentcommenters thatrepresent different interests. Wehave assigned individual numbers toeach commenter to avoid confusion.