1150690.4 

 

Jane E. Luckhardt

jluckhardt@downeybrand.com 

916/520-5348 Direct 

916/520-5748 Fax 

621 Capitol Mall, 18th Floor

Sacramento, CA 95814 

916/444-1000 Main 

916/444-2100 Fax 

downeybrand.com 

April 12, 2011 

Shirley Rivera (AIR-3) 

U.S. EPA Region 9 

75 Hawthorne Street 

San Francisco, CA 94105-3901 

Phone: (415) 972-3966 

Re: Avenal Power Center, LLC Comments on Supplemental Statement of Basis Relating to 

a Prevention of Significant Deterioration Permit for the Emission of Air Pollutants 

Dear Ms. Rivera: 

Avenal Power Center, LLC (Avenal) hereby presents its comments on the U.S. Environmental 

Protection Agency’s (EPA) March 2011 Supplemental Statement of Basis. EPA drafted this 

Supplemental Statement of Basis in support of issuing a Prevention of Significant Deterioration 

(PSD) Permit for the Avenal Energy Project (Project). 

In the public notice accompanying the Supplemental Statement of Basis, EPA requested 

comment on only three issues. In light of this fact, Avenal has organized its comments to 

address the three issues identified by EPA: (1) EPA’s proposal to approve Avenal’s PSD Permit 

application for the Project without requiring a demonstration that this source will not cause or 

contribute to a violation of the new 1-hour National Ambient Air Quality Standard (NAAQS) for 

NO2 (the “hourly NO2 standard”); (2) EPA’s proposal not to require this source to meet 

emissions limitations for greenhouse gases (GHGs) or to demonstrate that the proposed source 

will not cause or contribute to a violation of the NAAQS for hourly concentrations of sulfur 

dioxide (“hourly SO2 standard”); and (3) EPA’s environmental justice analysis for its proposed 

PSD Permit action for the Project. 

I. Comments regarding EPA’s proposal to approve Avenal’s PSD Permit application 

for the Project without requiring a demonstration that this source will not cause or 

contribute to a violation of the hourly NO2 standard. 

As acknowledged by EPA in the Supplemental Statement of Basis, the implementation of the 

hourly NO2 standard has caused unforeseen delay in issuing the PSD Permit. Given the timeline 

of the Project’s PSD permitting process, EPA properly concludes that the PSD Permit 

application should be grandfathered from demonstrating compliance with the hourly NO2

standard. Nevertheless, EPA’s record in this proceeding already indicates that the Project will 

not cause or contribute to a violation of the hourly NO2 standard. 
Shirley Rivera (AIR-3) 

April 12, 2011 

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1150690.4 

A. EPA Clearly Has Authority to Issue Avenal’s PSD Permit Without Considering 

the Hourly NO2 Standard.

As EPA’s record shows, Avenal first approached Region 9 permitting officials in 2007 to discuss 

the substantive and procedural requirements for obtaining a PSD Permit for the Project. It 

submitted an Application for Certification of the Project to the California Energy Commission 

(“Energy Commission”) on February 13, 2008, and then submitted its formal PSD Permit 

application to EPA on February 15, 2008. 

Under 40 C.F.R. § 124.3, EPA is required to review such a permit application and then, within 

30 days of receiving it, notify the permit applicant whether the application is complete. “If the 

application is incomplete, the Regional Administrator shall list the information necessary to 

make the application complete.” (40 C.F.R. § 124.3[c].) Importantly, EPA cannot process a 

PSD permit application “until the applicant has fully complied with the application requirements 

for that permit.” (40 C.F.R. § 124.3[a][2].) 

In accordance with the requirements of the Clean Air Act (CAA) and EPA's implementing 

regulations, EPA formally notified Avenal that its PSD Permit application was complete as of 

March 19, 2008. This “completeness determination” is important because, under Section 165(c) 

of the CAA, “Any completed permit application under [the PSD program] . . . shall be granted 

or denied not later than one year after the date of filing of such completed application.” (See 42 

U.S.C. § 7475[c].) Thus, EPA had a legal obligation to make a final decision on Avenal's PSD 

Permit by March 19, 2009. 

Avenal does not believe that EPA has authority to require a permit applicant to retroactively 

meet new requirements that become effective after the applicant has submitted a complete and 

valid application. Otherwise, section 165(c) would essentially become a nullity. Moreover, the 

Supreme Court has clearly stated that “‘Retroactivity is not favored in the law,’ and . . . that 

‘congressional enactments and administrative rules will not be construed to have retroactive 

effect unless their language requires this result.’” (Landgraf v. USI Film Prods., 511 U.S. 244, 

264 [1994].) Nothing in the CAA or in any EPA regulations allows the retroactive application of 

new requirements after a complete permit application has been submitted. In fact, EPA's 

regulations clarify that, once the completeness determination has been made, “the Regional 

Administrator [or delegated authority] may request additional information from an applicant but 

only when necessary to clarify, modify, or supplement previously submitted material. Requests 

for such information will not render an application incomplete.” (40 C.F.R. § 124.3[c] 

[emphasis added].) 

If EPA had complied with its obligation under Section 165(c), there would be no question 

regarding the relevance of the hourly NO2 standard. EPA was required to make a final decision 

on Avenal's PSD Permit by March 19, 2009, and EPA did not even propose the hourly NO2

standard until June 2009. This standard was not finalized until February 9, 2010 – almost a year 
Shirley Rivera (AIR-3) 

April 12, 2011 

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1150690.4 

after the statutory deadline for issuing the PSD Permit – and did not become effective until April 

9, 2010. 

Requiring a permit applicant to meet a new permitting requirement that was adopted after the 

submittal of a complete permit application is inconsistent with Section 165(c) and potentially 

creates a permitting process that could continue in perpetuity without resolution. Congress 

included Section 165(c) as part of the 1977 Amendments to the CAA to address its concern that 

the PSD program could fall prey to unreasonable bureaucratic delays. (See S. Rep. No. 94-717, 

at 23 [1976].) The purpose of this section is specifically discussed in the Senate Committee on 

Public Works Report regarding the 1977 Amendments, which states: 

Inherent in any review-and-permit process is the opportunity for delay. The 

Committee does not intend that the permit process to prevent significant 

deterioration should become a vehicle for inaction and delay. To the contrary, the 

States and Federal agencies must do all that is feasible to move quickly and 

responsibly on permit applications and those studies necessary to judge the impact 

of an application. Nothing could be more detrimental to the intent of this section 

and the integrity of this Act than to have the process encumbered by bureaucratic 

delay.

(Id. [emphasis added].) The plain language of Section 165(c) confirms Congress's expressed 

intent that PSD permitting procedures should not delay construction projects. If Congress had 

intended to allow EPA to apply new requirements retroactively, then it would not have explicitly 

set an end date for EPA's permitting decisions —one year after the receipt of a complete 

application. (See 42 U.S.C. § 7475[c].) 

The federal courts have also made it clear that new permitting requirements should not be 

applied retroactively. “Those regulated by an administrative agency are entitled to know the 

rules by which the game will be played.” (Alaska Prof'l Hunters Ass'n, Inc. v. FAA, 177 F.3d 

1030, 1035 [D.C. Cir. 1999].) “[O]ngoing proceedings should not be interrupted when proposed 

regulations become final. A contrary rule would create havoc in EPA's permit development 

procedures.” (Alabama v. EPA, 557 F.2d. 1101, 1110 [5th Cir. 1977].) 

Even if EPA is not prohibited from applying new requirements to pending permit applications, it 

clearly has authority to "grandfather" pending applications and thus exempt them from new 

requirements. In other words, EPA can clearly do what it has proposed to do in this case and 

issue a valid permit without requiring Avenal to demonstrate that it will meet the new hourly 

NO2 standard or any other permitting requirements that came into effect after Avenal submitted 

its permit application. 

This is clear from a number of EPA actions, as summarized in the Memorandum from Stephen 

D. Page, EPA Office of Air Quality Planning and Standards, Applicability of the Federal 

Prevention of Significant Deterioration Permit Requirements to New and Revised National 
Shirley Rivera (AIR-3) 

April 12, 2011 

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1150690.4 

Ambient Air Quality Standards (Apr. 1, 2010) (“Page Memo”). The Page Memo makes it clear 

that EPA may exercise its discretion on this matter and that it has routinely decided not to require 

pending permit applications to meet new permitting requirements: 

EPA has previously allowed proposed new major sources and major 

modifications that have submitted a complete PSD permit application before the 

effective date of new requirements under the PSD regulations, but have not yet 

received a final and effective PSD permit, to continue relying on information 

already in the application rather than immediately having to amend applications to 

demonstrate compliance with the new PSD requirements. 

(Page Memo at 3.) The Page Memo then cites examples of instances where EPA has actually 

issued regulations to clarify that pending permit applications were not covered by new PSD 

requirements. (Id. [citing 40 C.F.R. § 52.21[i][1][x] and 40 C.F.R. § 52.21[i][9]-[10].1

) Thus, it 

is clear that EPA can move forward as it has proposed and issue a final PSD Permit to Avenal 

without considering the hourly NO2 standard. 

B. The San Joaquin Valley Air Pollution Control District Has Modeled the Project’s 

Emissions Relative to the New Federal Hourly NO2 Standard.

Although EPA has decided to grandfather the Project from the new hourly NO2 standard, Avenal 

notes the San Joaquin Valley Air Pollution Control District (District) has evaluated the Project’s 

emissions in light of this new federal standard in connection with its issuance of a revised Final 

Determination of Compliance (FDOC) for the Project. (See San Joaquin Valley Air Pollution 

Control District, Final Determination of Compliance C-1100751 [“Revised FDOC”] at 

Attachment G.) This Revised FDOC is included as Attachment 1 to these comments. Avenal 

understands EPA may provide future guidance on how projects must show compliance with the 

new hourly NO2 standard that may be different than the analysis conducted by the District. EPA 

recognized at page 27 of the Supplemental Statement of Basis the District’s application of the 

District’s guidance and modeling of the Project to address the new hourly NO2 standard. Avenal 

further notes the District evaluated the same maximum hourly NO2 emissions that were in the 

application for the PSD Permit, and found the maximum hourly NO2 emissions will comply with 

the new hourly NO2 standard. (Supplemental Statement of Basis at 27.) Therefore, even when 

operating as contemplated in the PSD Permit application, the District’s analysis shows the 

Project’s emissions will not cause or contribute significantly to a violation of the State and 

 

1

 According to the Page Memo, EPA now believes that it must go through notice-and-comment in order to adopt a 

“grandfathering provision” that exempts pending permit applications from new requirements. (See Page Memo at 

3.) As far as Avenal has been able to determine, this assertion—that new requirements automatically apply to 

pending permit applications unless EPA goes through a notice-and-comment process to adopt a grandfathering 

provision—is made for the first time in the Page Memo. However, the issue is not relevant in this case because EPA 

is providing notice-and-comment on this question for Avenal. Thus, even if EPA must go through notice-andcomment to provide for "grandfathering," this requirement is satisfied in this case. 
Shirley Rivera (AIR-3) 

April 12, 2011 

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National Ambient Air Quality Standards, including the new 1-hour average NO2 standard. 

(Revised FDOC, Attachment G at 2-3.) 

The District’s analysis was conducted in response to a request for revisions to the existing 

FDOC. The revisions to the FDOC would limit the Project’s emissions to below the major 

source thresholds but would not limit or change the 1 hour emissions/short term limits for the 

Project from what had been previously approved or evaluated. However, as mentioned above the 

District’s analysis is the same regardless of whether the Project is built and operated as a major 

or minor source. The analysis is based on maximum hourly emissions, and the maximum hourly 

emissions rate would remain the same regardless of whether the Project is operated as a major or 

minor source. (Revised FDOC, Attachment G at 2 and Attachment J at 4-5.) 

Although EPA has not yet completed its attainment review for the hourly NO2 standard, the 

available information does not indicate that the San Joaquin Valley Air Basin is likely to violate 

the new standard. The data indicate that background levels at the monitors closest to the facility 

“are on par with measured levels of NO2 statewide, and that background levels of 1-hour NO2 in 

the general area surrounding the facility are not disproportionately high as compared with 

communities elsewhere in the State.” (Supplemental Statement of Basis at 26-27.) Furthermore, 

EPA notes that the Project’s impacts will be well below (in all cases, less than 6% of) the 

applicable NAAQS for the PSD pollutants regulated under the PSD Permit, including the annual 

NO2 standard. (Supplemental Statement of Basis at 26.) The District’s modeled NO2 impact for 

the annual averaging period is less than 1% of the NAAQS of 100 μg/m3

. 

Avenal is concerned that some commenters may use a calculation method specified under the 

California hourly NO2 standard and compare the results of that calculation to the federal hourly 

NO2 standard. As EPA is well aware, the statistical form of the federal hourly average NO2

standard is substantially different from the form of the California hourly average NO2 standard. 

As a result, comparisons to the new federal hourly standard that are based on analyses of the 

California hourly standard are inapt and should not be considered. 

II. Comments regarding EPA’s proposal not to require the Project to meet emissions 

limitations for greenhouse gases or to demonstrate that the proposed source will not 

cause or contribute to a violation of the NAAQS for hourly concentrations of sulfur 

dioxide. 

A. EPA Clearly Has Authority to Issue Avenal’s PSD Permit Without Considering 

Either the Hourly SO2 Standard or EPA’s New Greenhouse Gas Requirements.

As discussed above (in Section I.A), Avenal does not believe that EPA has authority to require a 

permit applicant to meet new requirements that are not adopted until after the applicant has 

submitted a complete and valid application. It would be fundamentally contrary to Section 

165(c) for EPA to impose new permitting requirements to pending applications that have been 

found to be complete. Avenal believes that would also be contrary to numerous court cases, 
Shirley Rivera (AIR-3) 

April 12, 2011 

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1150690.4 

including cases from the Supreme Court, which has made it clear that “‘Retroactivity is not 

favored in the law,’ and...that ‘congressional enactments and administrative rules will not be 

construed to have retroactive effect unless their language requires this result.’” (Landgraf v. USI 

Film Prods., 511 U.S. 244, 264 [1994].) 

Again, if EPA had complied with its obligation under Section 165(c), there would be no question 

regarding the relevance of the hourly SO2 standard or EPA's new permitting requirements for 

GHGs. Under Section 165(c), EPA was required to make a final decision on Avenal's permit by 

March 19, 2009, and EPA did not even propose the hourly SO2 standard or the new GHG 

permitting requirements until well after this date. 

Even if EPA is not prohibited from applying its new SO2 and GHG requirements to Avenal, the 

Agency clearly has authority to “grandfather” the Avenal application and thus exempt Avenal 

from these requirements. In other words, EPA can clearly do what it has proposed to do in this 

case and issue a valid permit without requiring a permit limit on GHG emissions and without 

requiring Avenal to demonstrate that it will meet the new hourly SO2 standard. 

As discussed above, EPA may exercise its discretion on how to apply new requirements to 

pending permits and has often decided not to require pending permit applications to meet new

permitting requirements. EPA has raised the question of whether it must go through a noticeand-comment proceeding in order to “grandfather” pending permit applications from new 

requirements. In this case, EPA has issued a public notice proposing to exempt Avenal from its 

new NO2, SO2, and GHG permitting requirements and has explained the reasoning for this 

exemption. Because this notice addressed the Avenal situation specifically, it may or may not 

apply to other pending permit applications. There can be no question, however, that EPA has 

gone through any notice-and-comment process that may be necessary to exempt Avenal from the 

new permitting requirements related to NO2, SO2, and GHGs. Thus, it is clear that EPA can 

move forward as it has proposed and issue a final PSD Permit to Avenal without considering the 

hourly NO2 standard, the hourly SO2 standard, and the new permitting requirements for GHGs. 

B. The Project Complies With the New Hourly SO2 Standard.

Because of the low SO2 emissions from the Project, the Supplemental Statement of Basis 

correctly concludes that EPA regulations do not require additional analysis to demonstrate that 

this source will not cause a violation of the hourly SO2 standard. (Supplemental Statement of 

Basis at 9.) Regardless of whether the Project operates as a major or minor source, its SO2

emissions will be well below the 40 tons per year significant emissions rate for SO2. (See 40 

C.F.R. § 52.21[b][23][i]; see also Final Energy Commission Decision for the Avenal Energy 

Project [December 2009] [“Final Decision”; included below as Attachment 2] at 126 [Air 

Quality Table 6].) Therefore, additional SO2 analysis is not required for the Project. (See 40 

C.F.R. §§ 52.21[m][1] and 52.21[b][23][i].) 
Shirley Rivera (AIR-3) 

April 12, 2011 

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1150690.4 

C. The California Energy Commission Evaluated the Project’s GHG Emissions.

Although EPA has decided to grandfather the Project from PSD review of the Project’s GHG 

emissions, Avenal notes the Energy Commission has studied and adopted a policy on how GHG 

emissions should be addressed under the California Environmental Quality Act (Cal. Publ. Res. 

Code §§ 21000 et. seq. [CEQA]) in its power plant siting process. Although not a best available 

control technology analysis, Avenal believes it is important to acknowledge and include the 

extensive GHG analysis conducted by the Energy Commission for this Project. The Energy 

Commission instituted an entire informational proceeding on this issue. (See Energy 

Commission Docket # 08-GHG OII-01.) This informational proceeding culminated in an 

independent consultant report, commissioned by Energy Commission staff and prepared by 

MRW and Associates. (See MRW and Associates, Framework for Evaluating Greenhouse Gas 

Implications of Natural Gas-Fired Power Plants in California [May 2009] [the “MRW Report”] 

[included below as Attachment 3].) 

The MRW Report concludes that “when assessing the impacts of an additional resource seeking 

to supply power to the integrated system, that resource must be considered in the context of the 

system as a whole.” (MRW Report at 33.) The MRW Report demonstrates that new, efficient 

natural gas generation designed to meet specified system needs, such as the Project, will cause a 

net reduction in GHG emissions systemwide. (See id. at 98-99.) Therefore, new natural gasfired generation is required in the near term to facilitate the integration of renewable generation 

facilities. (See id.) Avenal also notes California is very close to adopting the most aggressive 

renewable portfolio standard in the country. (S.B. X1-2 [2011].) 

In processing the Project’s Application for Certification, the Energy Commission evaluated the 

Project’s GHG impacts in light of the MRW Report’s conclusions. (Final Decision at 103-111.) 

The Final Decision found the Project will displace older less-efficient power plants in the 

dispatch order and thereby reduce overall GHG emissions from California’s electrical system. 

(Final Decision at 112-113.) Due to this finding, the Final Decision found “The Avenal Energy 

Project’s operational GHG emissions will not cause a significant adverse environmental impact.” 

(Final Decision at 113.) 

The circumstances in this case strongly support EPA’s decision not to subject the Project’s GHG 

emissions to PSD review. EPA did not finalize the Tailoring Rule until well after the Energy 

Commission issued its Final Decision for the Project, and after the PSD Permit application was 

determined complete by EPA. (See 75 F.R. 31514 [June 3, 2010].) Under the Tailoring Rule, 

PSD permits issued after January 2, 2011 for new major sources with GHG emissions over 

75,000 tpy must address GHG emissions. Given that the PSD Permit application was deemed 

complete over two years prior to the publication of the final Tailoring Rule, both Avenal and 

EPA expected the PSD Permit would be issued well before the effective date of GHG regulation 

under the PSD program. (Supplemental Statement of Basis at 8.) 
Shirley Rivera (AIR-3) 

April 12, 2011 

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1150690.4 

III. Comments on EPA’s environmental justice analysis for its proposed PSD permit 

action for the Project. 

Avenal generally supports the environmental justice analysis in the Supplemental Statement of 

Basis. It is clear that sufficient analysis has already been done to demonstrate that the Project 

will not create any disproportionately high and adverse human health or environmental effects on 

any population, including minority and low-income populations. Indeed, Avenal has already 

introduced this evidence into EPA’s record for this proceeding, including evidence regarding the 

GHG analysis completed by the Energy Commission. (See Avenal Power Center LLC, 

Documents for EPA PSD Permit Record, Docket ID EPA-R09-OAR-2009-0438-0029.1 

[October 14, 2009] [see in particular Section A (Environmental Justice) and Section E 

(containing Final Staff Assessment pp. 4.1-71 through 4.1-90)].) In addition, the hourly NO2

analysis performed by the District is included as Attachment 1 to this comment letter. (See 

Revised FDOC at Attachment G.) This evidence provides additional insight into the two areas 

EPA proposes to grandfather for this Project. Therefore, there is sufficient evidence in EPA’s 

record to demonstrate that EPA has complied with Executive Order 12898. 

It is important to recall the location proposed for this Project. The Project will be located in the 

industrial zoned area of the City of Avenal. The City carefully selected this area for industrial 

development because it is surrounded by agricultural lands, six miles from the urban center of 

the City, and separated from the urban area by a low range of hills and interstate 5, a major north 

south highway. Furthermore, the City of Huron is located approximately 8 miles north and 

Kettleman City is located approximately 10 miles southeast of the proposed site. (See 

Supplemental Statement of Basis at 16.) 

Avenal provides the following information to supplement EPA’s discussion of environmental 

justice issues with other evidence already in EPA’s record. 

A. The Project’s Environmental Justice Analysis Is Already Sufficient.

It is crucial to recall that EPA has concluded the new hourly federal NO2 standard does not apply 

to the Project in the first place. However, even if the new hourly NO2 standard did apply to the 

Project, the analysis already conducted by the District is sufficient to demonstrate that the 

Project’s short-term NO2 emissions will not cause any disproportionate environmental impacts to 

environmental justice communities. 

The analysis conducted by the Energy Commission unequivocally demonstrates that the Project 

will not cause or contribute to air quality levels in excess of any applicable health standard that 

by rule cannot be less stringent than those required by the Clean Air Act and administered by 

EPA. (Final Decision at 122-132.) The District also concluded that the Project will not cause or 

contribute significantly to a violation of the state and federal ambient air quality standards, 

including the new federal hourly NO2 standard. (Revised FDOC at Attachment G, p. 2-3.) 

Furthermore, the analyses already completed demonstrate that the Project’s emissions of these 
Shirley Rivera (AIR-3) 

April 12, 2011 

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1150690.4 

pollutants will not cause any disproportionately high and adverse human health or environmental 

effects on any population, including minority or low-income populations. (Supplemental 

Statement of Basis at 29; Final Decision at 327-332.) Further, as noted by EPA the hourly SO2

standard that was promulgated set a significance level below which no additional analysis is 

required since emissions below that standard do not subject any sensitive population and 

therefore, any minority or disadvantaged population to a significant health risk. 

Although barely mentioned in the Supplemental Statement of Basis, the Energy Commission 

conducted a full environmental justice screening analysis for the Project. The Energy 

Commission concluded that the Project as mitigated will not have a disproportionate impact on 

low-income or minority populations. (See Final Decision at 328-334.) This screening analysis 

was conducted specifically to address environmental justice policies in federal Executive Order 

12898, as well as additional California policies. (Final Decision at 329.) This analysis was also 

included in the Energy Commission Staff Assessment for the Project, which was already 

introduced into EPA’s record. (See Avenal Energy Project, Documents for EPA PSD Permit 

Record, Docket ID EPA-R09-OAR-2009-0438-0029.1 [October 14, 2009] at Section A, 

Environmental Justice.) 

The Energy Commission’s thorough review of this issue should be highly probative. The Energy 

Commission is the California agency charged with evaluating all aspects of proposed power 

plants. The Energy Commission has “the exclusive power to certify all sites and related facilities 

in the state, whether a new site and related facility or a change or addition to an existing 

facility.” (Cal. Pub. Res. Code § 25500.) The issuance of a power plant license by the Energy 

Commission is “in lieu of any permit, certificate, or similar document required by any state, local 

or regional agency, or federal agency to the extent permitted by federal law, for such use of the 

site and related facilities, and shall supersede any applicable statute, ordinance, or regulation of 

any state, local, or regional agency, or federal agency to the extent permitted by federal 

law.” (Id.) Therefore, the Energy Commission’s analysis and conclusions on this topic are 

highly relevant to EPA’s review of the PSD Permit. 

Avenal also evaluated the Project’s impacts to potential environmental justice populations in its 

Application for Certification submitted to the Energy Commission. This analysis is also 

included in EPA’s record for this proceeding (see Docket ID EPA-R09-OAR-2009-0438-0012). 

B. EPA Does Not Need Further Analysis to Conclude the Project Will Not Cause 

Any Adverse Disproportionate Impacts to Environmental Justice Communities. 

EPA does not need further analysis to conclude that the Project will not have any adverse 

disproportionate impacts on environmental justice communities. A recent Environmental 

Appeals Board (EAB) decision held that “[c]ompliance with a NAAQS standard that the Agency 

has already deemed inadequate to protect the public health cannot by itself satisfy a permit 

issuer’s responsibility to comply with [Executive Order 12898].” (In re: Shell Gulf of Mexico, 

Inc. and Shell Offshore, Inc., OCS Appeal Nos. 10-1 to 10-4, Slip Op. at 75 [December 30, 
Shirley Rivera (AIR-3) 

April 12, 2011 

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2010] [“Shell II”].) However, in this case EPA is not simply relying on compliance with the 

annual NO2 standard to demonstrate compliance with Executive Order 12898. 

In Shell II, EPA Region 10 issued two PSD permits. In approving these permits, Region 10 

provided only a single paragraph of substantive environmental justice analysis. (Shell II at 76 

[fn. 83].) Region 10 relied entirely on compliance with the applicable annual NO2 standard in 

concluding the proposed projects would not cause any disproportionately high and adverse 

human health or environmental impacts. The new hourly NO2 standard had been proposed prior 

to the issuance of the draft permits in that case. Therefore, the EAB concluded that Region 10 

had improperly based its entire environmental justice analysis on a standard that was no longer 

adequate in itself to ensure no impacts to environmental justice populations. (Shell II at 81.) 

Several key distinctions from the Shell II case demonstrate that EPA can properly issue Avenal’s 

PSD Permit based on the existing analysis. First and foremost, in Shell II, Region 10 relied on 

nothing more than the annual NO2 standard for its environmental justice analysis. In this case, 

there is already extensive environmental justice analysis in EPA’s record, in addition to the 

analysis provided in the Supplemental Statement of Basis. (See Avenal Power Center LLC, 

Documents for EPA PSD Permit Record, Docket ID EPA-R09-OAR-2009-0438-0029.1 

[October 14, 2009] at Part A; see also Final Decision at 328-332.) 

Second, in Shell II, Region 10 did not even address the hourly NO2 standard, despite the fact that 

it had already been proposed at the time Region 10 issued the draft permits. In this case, the 

District has analyzed the Project’s impacts in light of the new hourly NO2 standard and 

concluded that the Project’s emissions will not cause or contribute significantly to a violation of 

the State and National Ambient Air Quality Standards, including the new hourly NO2 standard. 

Although EPA may provide guidance in the future for a different modeling analysis or protocol, 

at this time the District’s analysis provides an independent assessment of the Project’s impacts 

on the new hourly NO2 standard. 

Finally, the Supplemental Statement of Basis devotes a great deal of analysis to the hourly NO2

standard and to the environmental justice implications of the new standard. Therefore, EPA’s 

record in this proceeding is entirely different from the Shell II case, and is more than sufficient to 

support the issuance of the PSD Permit. 

C. Greenhouse Gas and CoPollutant Emissions Have Been Addressed.

GHGs are emitted at specific locations but combine to create a global impact. The global impact 

is what allows GHGs to be mitigated on a regional (and in some cases national and even 

international) level. Nonetheless, where an environmental justice community could be impacted 

by the emissions from a facility, the regulatory agencies need to consider the local impacts of 

GHG emissions to ensure co-pollutants are not disproportionately impacting environmental 

justice communities. It is important to keep in mind the Project is fired on natural gas and has 
Shirley Rivera (AIR-3) 

April 12, 2011 

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1150690.4 

the inherent reduction in GHG emissions based upon fuel choice when compared to power plants 

fired with coal. 

The Energy Commission has evaluated how to address GHG impacts in its siting process. As 

discussed above in Section II(C), the Energy Commission conducted an informational 

proceeding on how best to address GHG impacts from the facilities it permits. This proceeding 

resulted in a report concluding that “when assessing the impacts of an additional resource 

seeking to supply power to the integrated system, that resource must be considered in the context 

of the system as a whole.” (MRW Report at 33.) Therefore, after extensive study, the Energy 

Commission has determined the GHG impacts of power plants cannot be considered in isolation. 

Of course, the co-pollutants generated along with a project’s GHG emissions must be addressed, 

and in the Project’s case the impacts of co-pollutants on the public and environmental justice 

communities has been extensively evaluated by multiple agencies. Taken together, the Energy 

Commission, the District, and EPA have demonstrated that the Project will not result in any

significant direct, indirect, or cumulative impacts to air quality. (Final Decision at 132; Revised 

FDOC, Attachment G at 2-3; EPA Statement of Basis and Ambient Air Quality Impact Report 

for a Clean Air Act PSD Permit [Permit No. SJ 08-01; June 2009] at 30.) 

D. Comments Regarding Potential Ambient NO2 Monitoring in the Project Vicinity

The Supplemental Statement of Basis seeks comment regarding the potential placement of an 

ambient NO2 monitor in the Project vicinity. (Supplemental Statement of Basis at 29-30.) Given 

the Project’s proximity to Interstate 5, Avenal has doubts as to whether such a monitor would 

prove useful for measuring impacts from the Project. 

The Supplemental Statement of Basis notes that 91% of NOx emissions in Kings County derive 

from mobile sources. (Supplemental Statement of Basis at 19.) Furthermore, near-roadway 

concentrations have been measured at approximately 30 to 100% higher than those measured 

away from major roads. (Id.) In this case, Interstate 5 (I-5) is the dominant source of NOx

emissions in the Project vicinity. The Project is located just two miles from I-5. (Final Decision 

at 1.) I-5 is a north-south four-lane freeway that connects the Central Valley with northern and 

southern California. The Energy Commission’s Final Decision indicates that traffic volume on I5 in the Project area averages 35,400 vehicles per day, 30 percent of which is truck traffic. 

(Final Decision at 314.) 

Given the substantial NO2 levels attributable to I-5, it seems unlikely that a monitor installed in 

the Project vicinity would be helpful to evaluate the Project’s comparatively small NO2 impacts. 
Shirley Rivera (AIR-3) 

April 12, 2011 

Page 12 

1150690.4 

IV. Conclusion 

Avenal thanks EPA for the opportunity to comment on the Supplemental Statement of Basis for 

the Project’s PSD Permit. 

Very truly yours, 

DOWNEY BRAND LLP 

/S/ 

Jane E. Luckhardt 

Nicholas H. Rabinowitsh 

JEL:NHR 

Attachments: 

1. San Joaquin Valley Air Pollution Control District, Final Determination of Compliance C1100751 (December 17, 2010) 

2. California Energy Commission, Final Commission Decision for Avenal Energy Project 

(Application for Certification No. 08-AFC-1) (December 2009) 

3. MRW and Associates, Framework for Evaluating Greenhouse Gas Implications of 

Natural Gas-Fired Power Plants in California (May 2009)