## U.S. ENVIRONMENTAL PROTECTION AGENCY

REGION IX

STATEMENT OF BASIS AND AMBIENT AIR QUALITY IMPACT REPORT

ADDENDUM

For a Clean Air Act Prevention of Significant Deterioration Permit



# Victorville 2 Hybrid Power Project

PSD Permit Number SE 07-02

March 2010This page left intentionally blank

## Proposed Prevention of Significant Deterioration (P SD) Permit

Statement of Basis and Ambient Air Quality Impact R eport

Addendum

VICTORVILLE 2 HYBRID POWER PROJECT

On June 6. 2008, EPA proposed a Prevention of Sign ificant Deterioration (PSD) permit for the Victorville 2 Hybrid Power Project and publ ished a public notice requesting comment on the permit in the Victorville Daily Press. EPA received two comment letters on July 7, 2008, o ne from Adams Broadwell Joseph & Cardozo (ABJC), on be half of California Unions for Reliable Energy (CURE), and one from ENSR Corporation (ENSR) , on behalf of the City of Victorville and Inland Energy. On October 7, 2008, ENSR withdre w its comment letter on the proposed permit, and on June 8, 2009, ABJC also withdrew its comment letter. EPA received no other comments regarding the proposed action and PSD perm it. Because both comment letters were withdrawn, EPA has determined it is not necessary t o respond comments in issuing the final PSD permit allowing construction of the facility.

Before ABJC withdrew its comment letter, EPA change d its policy for evaluating particulate matter with a diameter of 2.5 microns o r less (PM 2.5 ). The proposed PSD permit relied on the provision of the May 16, 2008 final r ule for PM 2.5 (73 FR 28321) allowing the use

of PM 10 as a surrogate for PM 2.5 for complete permit applications submitted before July 15, 2008, known as the grandfathering provision. On Fe bruary 10, 2009, Earthjustice, on behalf of

the Natural Resources Defense Council and the Sierr a Club, submitted a petition for reconsideration on four provisions of the May 2008 final PM 2.5 rule, including the grandfathering provision. EPA granted a three-month administrativ e stay of the grandfathering provision, effective June 1, 2009 (74 FR 26098). On September 22, 2009, EPA issued a final rule extending the administrative stay an additional nin e months, until June 22, 2010 (74 FR 48153). On February 11, 2010, EPA proposed to repeal the gr andfathering provision from the PM 2.5 new source review (NSR) implementation rule and confirm ed the current stay on the grandfathering provision remains in effect through June 22, 2010 ( 75 FR 6827).

EPA requested additional information from the appli cant to evaluate if this change in regulatory policy would result in requiring any dif ferent conditions in the PSD permit. The BACT analysis and conditions are still appropriate for natural gas-fired power plants because the combustion of natural gas results in the formation of particulate matter that is exclusively PM 2.5 , therefore PM 10 and PM 2.5 are equivalent from natural gas-fired turbines. T herefore, the BACT determination and emission limits in the PSD permit for PM 2.5 were unchanged, but the final permit was revised to refer to “PM 2.5 ” rather than “PM 10 as a surrogate for PM 2.5 ”. This revision to require BACT for PM 2.5 does not require an additional public comment peri od because this revision does not relax or significantly revise any of the original proposed permit conditions.

The applicant also submitted modeling to demonstrat e that PM 2.5 emissions would not cause a violation of the NAAQS. For the PM 2.5 modeling requirements for PSD, EPA has notyet established the significant impact levels (SILs ). The SILs are used as a screening tool;

applicants with emission impacts below the SILs are not required to conduct the cumulative impact analysis that includes the impacts of nearby sources. Because EPA has not yet

established SILs for PM 2.5 , on December 29, 2009, AECOM submitted a cumulativ e modeling analysis for PM 2.5 . AECOM included emissions from the following nearb y sources: High Desert Power Plant, AGC Glass Company, and TXI Riverside C ement. The modeling results determined that impacts of the Victorville 2 facili ty combined with the three major nearby sources would result in a cumulative impact of 14 μ g/m 3 (24-hour average) and 1.65 μg/m 3

(annual average). Additionally, AECOM updated thei r background PM 2.5 concentrations to use data from 2005 – 2007. AECOM used background value s based on the highest 3-year average of the 98th percentiles (19 μg/m 3 on a 24-hour average), and the highest 3-year aver age annual mean (10.1 μg/m 3 on an annual average). Thus, the cumulative impac t of Victorville 2 and nearby facilities, plus the background is 33 μg/m 3 (24-hour average) and 11.7 μg/m 3 (annual average), which does not exceed the PM 2.5 NAAQS of 35 μg/m 3 (24-hour average) and 12 μg/m 3

(annual average). Because AECOM made conservative assumptions in modeling the nearby

sources and PM 2.5 background, EPA has determined that the conditions in the PSD permit as proposed do not require revision. The PM 2.5 modeling assumptions are conservative because AECOM modeled nearby sources (AGC Glass Company and TXI Riverside) using the conservative assumption that PM 2.5 emissions are 100% of PM 10 emissions. In addition, the background data from 2005-2007 also measures the im pact from existing nearby sources (High Desert Power Plant, AGC Glass Company and TXI River side).

The December 29, 2009 cumulative modeling analysis is available in the docket for this action (Docket ID # EPA-R09-OAR-2008-0765), and EPA has determined that an additional public comment period is not required because the p ermit conditions were not relaxed and the additional modeling analysis was submitted to compl y with a more stringent modeling requirement for PM 2.5 . The results of the conservative modeling analysi s show that Victorville 2

will not cause or contribute to a violation of the PM 2.5 NAAQS. Therefore, EPA is finalizing the PSD permit for Victorville 2 with the minor revisio ns listed above.