# TRANSCRIPT OF PROCEEDINGS

**HERITAGE REPORTING CORPORATION**

Official Reporters 1220 LStreet, N.W., Suite 600 Washington, D.C. 20005

-4018 (202) 628

-4888 contracts@hrccourtreporters.com In the Matter of: ) ) HEARING TO TAKE COMMENT ON ) EPA'S PROPOSED RULEMAKING ) ENTITLED, "STATE ) IMPLEMENTATION PLANS: ) RESPONSE TO PETITION FOR ) Docket No. EPA
-HQ
-OAR RULEMAKING; FINDINGS OF ) 2012

- 0322 SUBSTANTIAL INADEQUACY; AND ) SIP CALLS TO AMEND PROVISIONS ) APPLYING TO EXCESS EMISSIONS ) DURING PERIODS OF STARTUP, ) SHUTDOWN, AND MALFUNCTION )

Pages: 1 through 76 Place: Washington, D.C. Date: March 12, 20131

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- 4888 IN THE UNITED STATES ENVIRONMENTAL PROTECTION AGENCY In the Matter of: ) ) HEARING TO TAKE COMMENT ON ) EPA'S PROPOSED RULEMAKING ) ENTITLED, "STATE ) IMPLEMENTATION PLANS: ) RESPONSE TO PETITION FOR ) Docket No. EPA
-HQ
-OAR RULEMAKING; FINDINGS OF ) 2012

- 0322 SUBSTANTIAL INADEQUACY; AND ) SIP CALLS TO AMEND PROVISIONS ) APPLYING TO EXCESS EMISSIONS ) DURING PERI ODS OF STARTUP, ) SHUTDOWN, AND MALFUNCTION )
Room 1153 Ariel Rios Building EPA East 1200 Pennsylvania Avenue, N.W. Washington, D.C. Tuesday, March 12, 2013 The parties met, pursuant to notice, at 9:09 a.m. BEFORE: Joseph Dougherty, EPA, Office of Air

Quality Planning and Standards Geoffrey Wilcox, EPA, Office of General Counsel SPEAKERS: ROBERT ALVEY, President, Board of Public Utilities, Kansas City, MO ROBERT MANNING, Hopping Green & Sams, Tallahassee, FL, on behalf of Florida Electric Power Generating Group MICHAEL DOWD, Director, Air Division, Virginia Department of Environmental Quality STEPHANIE MADDIN, D.C. Office of Earthjustice2

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- 4888 SPEAKERS: (Cont'd) JEFF HOLMSTEAD, Electric Reliability Coordinating Council BRUCE BUCKHEIT, Fairfax, VA LESLIE RITTS, National Environmental Development Association, Clean Air Project MAXINE LIPELES, Washington University School of Law, Interdisciplinary Environmental Clinic SPARSH KHANDESHI, Environmental Integrity Project TAMARA EVANS, Sierra Club, Environmental Law program TERRY MCGUIRE, Sierra Club ALEX BOND, Director of Air Quality, National Mining Association3

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- 4888 P R O C E E D I N G S 1 (9:09 a.m.) 2 MR. DOUGHERTY: My name is Joseph Dougherty, 3 and I'm representing EPA's Office of Air Quality 4 Planning and Standards. I'll be chairing today's 5 hearing. Joining me on this hearing panel is Geoffrey 6 Wilcox, EPA's Office of General Counsel, in our air 7 and Radiation Law office. 8 Thank you for attending this public hearing 9 held by the U.S. Environmental Protection Agency. 10 We're holding this hearing to take comment on EPA's 11 proposed rulemaking entitled, "State Implementation 12 Plans: Response to Petition for Rulemaking; Findings 13 of Substantial Inadequacy; and SIP Calls to Amend 14 Provisions Applying to Excess Emissions During Periods 15 of Startup, Shutdown, and Malfunction." 16 This proposed rulemaking was signed on 17 February 12, 2013, and posted on the internet the next 18 day. The proposed rulemaking was published in the 19 Federal Register on February 22, 2013, at page 12460. 20 We are here today to listen to your comments 21 on EPA's proposed action. The purpose of this hearing 22 is to listen to your comments, but not for Mr. Wilcox 23 or me to expand upon, discuss , or debate the proposal. 24 Today's hearing is one opportunity for the public to 254

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- 4888 comment on EPA's proposed rulemaking. You may also 1 submit written comments. A four

-page fact sheet of 2 the proposal is available in the registration area and 3 also online summarizing the proposal and includes 4 detailed information for submitting written comments. 5 The EPA invites public comment on specific 6 elements of the proposed rulemaking as well as on any 7 other issues raised by the proposal. The rule would 8 ensure that state s have plans in place to require 9 industrial facilities across the country to follow air 10 pollution rules even during times when the facility is 11 starting up and shutting down or when a malfunction 12 occurs. Air pollution emitted during these periods of 13 startup and shutdown or malfunction, periods that 14 collectively are often referred to as SSM for short, 15 may adversely affect the health of people nearby and 16 may contribute to smog and other problems in 17 communities that are further downwind. 18 As explained in our fact sheet, the proposed 19 action responds to a petition for rulemaking that the 20 Sierra Club filed with the EPA Administrator in 2011. 21 The Petition included three interrelated requests 22 concerning the treatment of excess emissions of air 23 pollution that may o ccur when an industrial facility 24 is starting up or shutting down or when a malfunction 255

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- 4888 occurs, specifically how those emissions are treated 1 in state implementation plan provisions that the EPA 2 approved in the past. 3 Along the lines of the Petition's three 4 requests, let me now summarize three main aspects of 5 the proposed rulemaking. First, the EPA proposes to 6 deny the request in the Petition that EPA prohibit 7 affirmative defenses in SIPs. Rather, the EPA is 8 revising its previous policy to continue to allow 9 affirmative defenses in SIPs for states that choose to 10 provide them, for excess emissions that occur when a 11 facility is experiencing a malfunction , but not for 12 excess emissions that occur when a facility is 13 operating in a planned startup or shutdown mode . 14 An affirmative defense is allowable when 15 well
-managed facilities experience malfunctions due to 16 circumstances beyond their control, and the 17 affirmative defense would shield the facility from 18 monetary penalties but not from the responsibility to 19 take action to limit future problems. 20 Second, the EPA proposes to grant the 21 Petitioner's claim for 36 of the 39 states identified 22 in the Petition by proposing to determine that these 23 36 states have approved SIPs that include one or more 24 SSM provisions that are inconsistent with the Clean 256

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- 4888 Air Act. 1 The EPA is proposing a "SIP Call" for each 2 of these 36 states. Under the SIP Calls, the EPA 3 would direct the affected states to correct specific 4 SIP provisions related to SSM. The 36 states are 5 listed in the fact sheet that I mentioned earlier. 6 Related to the proposed SIP Calls, the EPA 7 has in the same notice proposed to issue findings that 8 SSM provisions in the SIPs of these 36 states do not 9 meet the requirements of the Clean Air Act. As a 10 matter of procedure, in accordance with the Clean Air 11 Act, the EPA must make such "inadequacy" finding in 12 order to call upon a state to revise and resubmit its 13 plan. 14 According to our proposal, once the EPA 15 makes its final finding of inadequacy, affected states 16 would have 18 months within which to correct and 17 submit their SIP provisions to the EPA. 18 Third, the EPA proposes to deny the request 19 in the Petition that EPA discontinue reliance on 20 interpretive letters from states to clarify any 21 potential ambiguity in the state SIP submission. 22 Before we open the floor for testimony, 23 allow me to explain how this hearing will operate and 24 how to comment. Today we will be accepting oral 257

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- 4888 comments in our proposed rulemaking, and we will be 1 preparing a written transcript of this hearing. The 2 transcript will be available to the public as part of 3 the official record for this rule, and EPA will 4 consider both oral comments and written comments as we 5 move forward in the rulemaking process. 6 As explained in the proposal notice at page 7 12461, we are extending the comment period to 30 days 8 beyond today's public hearing date, and so will accept 9 written comments on the proposed rule until April 11, 10 2013. 11 For those who will be providing oral 12 comments today, I will call each scheduled speaker to 13 the microphone, which is right there. When it is your 14 turn to speak, please state your name and your 15 affiliation. It will help the court reporter over 16 there in preparing our transcript if you also spell 17 your name. If you wish to speak but have not already 18
registered to speak, either through the pre

19 registration or today at the registration desk, please 20 check in with our staff at the registration table 21 located just outside the entrance to this room. 22 That's Crystal outside. 23 We ask that you limit your testimony to not 24 longer than five minutes. After you finish your 258

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- 4888 testimony, Mr. Wilcox or I may ask you clarifying 1 questions to be sure that we and others in EPA 2 understand your comments. If in addition to the 3 transcript you would also like to put the full text of 4 your written statements into the docket, please be 5 sure to give a copy of any written comments to our 6 staff at the registration table. We intend to stay 7 until 6 p.m. this evening or one hour after the last 8 registered speaker has spoken, whichever is later. 9 The lunch break is scheduled from 12:30 p.m. 10 until 2 p.m. I would like to thank you all for 11 participating today. And if I have a chance to call 12 our first speaker, it's David Alvey. 13 MR. ALVEY: Good morning. I am David Alvey, 14 A
-L
-V
-E
-Y. I'm the President of the Board of Public 15 Utilities, Kansas City, Kansas. We appreciate this 16 opportunity to present the Board of Public Utilities' 17 views concerning the impact of EPA's proposal to issue 18 a SIP call regarding Kansas regulation emissions 19 during startup, shutdown, and malfunction, the effect 20 it will have on BPU's efforts to comply with its 21 obligations both to provide affordable, reliable 22 electric service to its customers and to meet the 23 several recent EPA rules limiting emissions by 24 electric generating units. 259

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- 4888 Just some basic facts about the Board of 1 Public Utilities. We are a municipally owned, not

2 for
-profit utility. We are governed by an elected 3 board. We are subject to the laws, the regulations, 4 and Charter Ordinances of the Unified Government of 5 Wyandotte County, Kansas City, Kansas. I and five 6 other board members, together with our General 7 Manager, Don Gray, who is present this morning, govern 8 the day
- to
-day business and strategic business 9 planning for the BPU. 10 The BPU operates water and e lectric 11 utilities for the benefit of residents and businesses 12 and industries in Wyandotte County and provides 13 electricity for the operation of the public water 14 supply for neighboring Johnson County, Kansas. The 15 BPU also provides power to the City of Columbia, 16 Missouri, and to the Kansas Municipal Electric 17 Association for distribution. 18 In BPU's Wyandotte County service area, we 19 have approximately 65,000 residential, commercial, and 20 industrial electric BPU customers. Our larger 21 customers include the Kansa s Speedway, Hollywood 22 Casino, and Schlitterbahn Vacation Village and Water 23 Park, that makes up our village west area. It's the 24 most popular tourist destination in Kansas. 2510

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- 4888 We also have several important industrial 1 customers, General Motors, Certain Teed Corporation, 2 Owens Corning, Procter & Gamble, Griffin Wheel, and 3 the University of Kansas Medical Center. Nonetheless, 4 Wyandotte County is one of the poorest counties in 5 Kansas and by some statistics would be the poorest 6 county in Kansas. More than 20 pe rcent of our 7 citizens live below the poverty level. Many of them 8 are disabled. They live on fixed incomes. 9 We make sure our electric service is 10 affordable for these and for all of our customers. 11 That is our top priority. To that end, the BPU has 12
managed its resources carefully to comply with 13 applicable laws, including air quality laws and 14 regulations, and to operate as a responsible utility 15 that utilizes a mix of electric generation, including 16 coal
- fired units as well as renewables, wind, hydro, 17 landfill gas, as well as energy efficiency programs. 18 The proposed rule would have its biggest 19 impact on the BPU's operation of its three coal

- fired 20 electric generating units, two units at the Quindaro 21 Station and one at the Nearman Station. These 22 baseload units offer the most affordable electricity 23 generation to our customers. 24 In addition to transmission constraints that 2511

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- 4888 restrict BPU's ability to import electricity, one of 1 the Quindaro units is for all practical purposes the 2 only reliable source of electric ity for about half of 3 our residential customers, and that would be in the 4 poorest area of the county. 5 All three units operate in compliance with 6 the terms of their air permits and under the terms of 7 the Kansas Clean Air Act State Implementation Plan. 8 The Kansas SSM regulation at issue, Kansas 9 Administrative Regulation ' 28

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- 1, approved by the 10 EPA in 1971, has been relied upon by the BPU since 11 then to assure that BPU remains in compliance with 12 applicable emissions requirements during times of 13 startup, shutdown, and malfunction at its coal

- fired 14 units. 15 The Kansas SSM regulation is designed to 16 cover very small periods of time in the range of .25 17 to 1.5 percent when BPU's units are in operation. The 18 amount of SSM emissions during these times does not 19 jeopardize the air quality or the ability of the BPU 20 to meet its emission obligations at other times. The 21 Kansas SSM regulation, and as EPA's proposed rule 22 recognizes, responds to this simple fact. Technology 23 is imperfect. 24 Despite BPU's best efforts to maintain and 2512

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- 4888 to operate our units within the financial limits of 1 our not
- for
-profit charter and the political realities 2 we face, emissions do vary. And the Kansas SSM offers 3 a balance between assuring that the overall emissions 4 limits are met and at the same time providing leeway 5 for varying operating conditions. And this leeway 6 assists the BPU in meeting its goal to provide 7 reliable electricity that its customers can afford. 8 The Kansas SSM regulation offers protection 9 against potential monetary penalties that could be 10 incurred if some leeway is not allowed for the limits, 11 as applied to BPU's current generation capability. As 12 you are well aware, the size of the penalties can be 13 multiplied very quickly into staggering amounts of 14 money that would clearly cripple BPU significantly, if 15 not fatally. And again, as a municipally

- owned 16 utility, should it cripple the BPU, it would also 17 cripple our unified government. 18 While BPU understands that those penalties 19 are intended to be an incentive to ensure compliance, 20 EPA's recent, more stringent emission limits places a 21 tremendous compliance burden on BPU and other public 22 power entities that given the legal and political 23 realities we face simply cannot be speeded up 24 regardless of the potential monetary penalties related 2513

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- 4888 to violations. 1 To pick one example from the plethora of new 2 Clean Air Act regulations that apply to electric 3 generating units within which BPU must comply, we 4 estimate that the controls necessary to meet the 5 limits set by EPA's Mercury and Air Toxic S tandards 6 for the Nearman unit alone will cost $250 million. 7 Obviously, it will cost even more to fund needed 8 controls for our other units and for other EPA rules. 9 In today's economic and political climate, 10 it has taken and will continue to take us consi derable 11 time to obtain all the approvals that we need from 12 city, county, state, and federal governmental and 13 regulatory bodies. There is no way around those 14 realities. Making BPU subject to potential monetary 15 penalties related to SSM events offers no realistic 16 incentive for speeding this process. In fact, it 17 would only make BPU's situation more difficult. 18 In sum, the bottom line is the BPU is making 19 good faith efforts to comply with the regulation's 20 requirements of the Clean Air Act. At the same time, 21 we have a specific responsibility to do so in a way 22 that we can continue to sustain our county and our 23 citizenry financially. And this additional burden 24 would simply make that perhaps not possible. 2514

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- 4888 We don't need penalties to encourage us to 1 make these changes. Thank you again for the 2 opportunity to address this matter. If you have any 3 questions, I'll be happy to answer them. 4 MR. DOUGHERTY: Thank you very much. 5 MR. ALVEY: Thank you. 6 MR. MANNING: Good morning. My name is 7 Robert Manning. Excus e me. I'm with the law firm of 8 Hopping Green & Sams in Tallahassee, Florida. I'm 9 here today on behalf of the Environmental Committee of 10 the Florida Electric Power Coordinating Group, also 11 known as the FCG
-EC. Thank you. 12 The FCG
-EC is a nonprofit organization in 13 the state of Florida that represents investor

- owned 14 utilities, electric cooperatives, and municipal 15 utilities on environmental issues affecting the 16 electric utility industry. The FCG

-EC is very 17 concerned about EPA's proposed SIP call relating to 18 emissions during startup, shutdown, and malfunction. 19 EPA's proposal has serious flaws and will have serious 20 consequences if finalized as proposed. 21 Procedurally, EPA has not provided 22 sufficient time to prepare comments in advance of this 23 hearing today, and given the unique state

- specific 24 issues involved, the FCG

-EC has requested that EPA 2515

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- 4888 conduct hearings in each affected state or at a 1 minimum in each EPA region. 2 Also, EPA is not providing sufficient time 3 to develop meaningful comments on this proposal , and 4 the FCG
-EC has requested a 90

-day extension of that 5 public comment period until July 10, 2013. The FCG

-EC 6 is awaiting EPA's response. And I would like to ask 7 at this time if EPA has a schedule for responding. 8 MR. WILCOX: It's been taken under 9 advisement to evaluate anyone who's asked for an 10 extension of time, and it will be evaluated. 11 MR. MANNING: Okay. Thank you. There are 12 36 states directly affected by EPA's proposal, and no 13 two state SSM rules are alike. Most of the provisions 14 at issue were added to SIPs and approved by EPA 15 decades ago. Florida's SSM rules, for example, were 16 approved by EPA over 30 years ago. Notably, during 17 this period, air emissions in Florida have decreased 18 substantially, and there have been very few issues 19 with attaining and maintaining the National Ambient 20 Air Quality Standards. 21 The Clean Air Act authorizes EPA to issue a 22 SIP call after it finds that a SIP is substantially 23 inadequate. EPA's unsupported allegations do not meet 24 this standard. EPA has declined to present any data 2516

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- 4888 showing that any of the state rules are having a 1 negative impact on the attainment or maintenance of 2 National Ambient Air Quality Standards, nor any data 3 that the rules are prohibiting or hindering 4 enforcement. 5 In Florida, for example, we are not aware of 6 any issue related to ambient standards and SSM rules, 7 and EPA states in the proposal that Florida's rules 8 are directly, "directly enforceable by the state, the 9 EPA, [and] members of the public." 10 And I would also like to ask at this time

-- 11 I know that EPA did not provide any of that type of 12 information, but does EPA have that information and it 13 just doesn't feel that it needs to provide it, or

-- 14 MR. WILCOX: Well, I think we are interested 15 in any data that you provide, Mr. Manning. We're 16 certainly interested to see what you have. And this 17 is something that the agency evaluates. As you know, 18 we don't necessarily think it's necessary to establish 19 those particular problems, but we are interested in 20 what you have. 21 MR. MANNING: Great. Thank you. EPA has 22 also declined to properly evaluate the substantial 23 consequences of this proposal, which will involve 24 revising 36 states' rules, including EPA's review and 2517

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- 4888 approval of SIP provisions, revising every permit that 1 contains the SSM rules at issue, which in Florida is 2 every permit; developing reporting protocols for 3 immediately advising permitting agencies, which will 4 be a substantial increase in their workload; and the 5 possibility of restricting operations, developing 6 alternative SSM limits , reducing emissions, which is 7 not even technically possible in many SSM situations, 8 or reporting and annually certifying noncompliance 9 regarding operations that are currently authorized. 10 In sum, there is no evidence of a problem 11 here, and the consequences of EPA unraveling decades 12 of history are severe. EPA's proposal contains 13 serious flaws, and the FCG

-EC requests that EPA 14 reevaluate its action, develop additional data 15 regarding its proposal, and provide additional time 16 for the public to review and comment on such 17 information. 18 Thank you for the opportunity to present our 19 initial comments today. 20 MR. DOUGHERTY: Thank you. 21 MR. MANNING: Thanks. 22 MR. DOWD: Good morning. I am Michael Dowd, 23 Director of the Air Division for the Virginia 24 Department of Environmental Quality. Thank you for 2518

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- 4888 the opportunity to provide oral comment on this 1 proposed SIP call. 2 Virginia is one of the states affected by 3 the proposed SIP call, which with respect to Virginia 4 focuses exclusively on the alleged inadequacy of a 5
s ingle regulatory provision concerning malfunctioning 6 facilities found at 9 Virginia Administrative Code 5

- 7 20

- 180G. 8 Unfortunately, the proposed SIP call took 9 that regulation out of context and failed to account 10 for other provisions of Virginia's air pollution 11 regulations that constrain DEQ's discretion with 12 respect to malfunctions. EPA's proposed SIP call 13 overlooked two significant Virginia regulatory 14 provisions: 9 VAC 5

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- 20E and 9 VAC 5

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- 20E, which 15 require owners to maintain and operate facilities and 16 air pollution control equipment in a manner to 17 minimize emissions at all times, including periods of 18 malfunction. Both of these regulations are approved 19 as part of the Virginia State Implementation Plan. 20 A related provision of Virginia's air 21 pollution control regulations also ignored by EPA is 9 22 VAC 5
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- 180I, which requires facilities to operate in 23 compliance with National Ambient Air Quality 24 Standards. This provision allows DEQ to order a 2519

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- 4888 facility to reduce operations or shut down if 1 necessary in o rder to prevent a violation of a NAAQS. 2 It does not exempt NAAQS exceedances caused by 3 malfunctions. 4 Virginia's air pollution control regulations 5 when read in their entirety do not give DEQ the 6 discretion to allow a facility to operate in 7 noncompliance with its emission limitations due to 8 malfunction. In fact, Virginia facilities are under a 9 continuing, federally enforceable obligation to 10 minimize emissions at all times, including periods of 11 malfunction. 12 Therefore, 9 VAC 5

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- 180G simply does not 13 pres ent a bar to obtaining injunctive relief to remedy 14 emission exceedances or NAAQS violations caused by 15 malfunctions. Perhaps EPA's failure to consider the 16 effect of these other regulations on 9 VAC 5

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- 180G 17 is understandable. After all, Virginia's air 18 po llution control program is complicated. 19 However, the program was legally adopted by 20 Virginia and approved by EPA in the SIP process in 21 accordance with the Clean Air Act's mandate for a 22 federal
- state partnership. 23 Okay then. Virginia asks the following 24 three things of EPA as it finalizes the SIP call. 2520

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- 4888 First, have an open mind. EPA should carefully 1 consider comments from affected states like Virginia. 2 State air pollution control programs like Virginia's 3 are complicated. EPA should recognize where it has 4 overlooked or misinterpreted relevant provisions of a 5 state air pollution control program and revise the 6 final SIP call accordingly. 7 Second, EPA should respect the federal
- state 8 partnership created by the Clean Air Act. The Agency 9 should not substitute its judgment for that of a state 10 absent clear evidence that the state implementation 11 plan violates the Clean Air Act and is not merely at 12 odds with EPA guidance. EPA therefore should not 13 focus on whether a single provision of the Virginia 14 SIP adheres to the letter of unpromulgated guidance 15 documents. 16 Instead, EPA should consider whether the 17 Virginia SIP as a whole provides the state with 18 effective tools to ensure that malfunctioning 19 facilities are brought into compliance with their 20 emission limitation s as soon as possible. The current 21 Virginia SIP does that. 22 Indeed, Virginia's approach is at least as 23 protective of the environment as EPA's, if not more so 24 because it focuses on the rapid resolution of 2521

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- 4888 malfunctions without first resorting to enforcement. 1 Initial resort to the enforcement process is not the 2 appropriate way to resolve emission exceedances caused 3 by malfunctions that are beyond the control of a 4 facility. That approach is neither required by the 5 Clean Air Act nor conducive to the prompt resolution 6 of malfunction situations. 7 And third, EPA should not impose a one

- size

8 fits

- all solution on states affected by this proposal. 9 State air pollution control programs and state 10 implementation plans are unique. Therefore, solutions 11 to fix alleged deficiencies in individual SIPs should 12 be custom
- tailored to individual state programs. 13 Again, thank you for this opportunity to 14 make this presentation. The Virginia DEQ will be 15 submitting written comments on this proposal, and I 16 have copies of my oral statement also available if 17 you'd like those. We look forward to working with EPA 18 to achieve a fair resolution of this matter. I'd be 19 happy to answer any questions. 20 MR. WILCOX: Thank you, Mr. Dowd. And as 21 you said, your comments that you have articul ated, you 22 have them? 23 MR. DOWD: Yes, sir. Yes, sir. 24 MR. WILCOX: Appreciate it. Thank you for 2522

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- 4888 commenting. 1 MR. DOWD: You're welcome. 2 MR. DOUGHERTY: We have no one immediately 3 scheduled next. We'll take a 10

-minute break. 4 (Whereupon, a brief recess was taken.) 5 MR. DOUGHERTY: Back on the record. 6 Stephanie Maddin. 7 MS. MADDIN: (Away from the microphone.) 8 MR. DOUGHERTY: I'm sorry? Yes. Right up 9 there, please. 10 MS. MADDIN: And I have a couple of
-- a 11 copy for the person that's I guess doing the

-- 12 MR. DOUGHERTY: We can take that, that's 13 fine. Thanks a lot. 14 MS. MADDIN: I can just go ahead? Okay. 15 Good morning. My name is Stephanie Maddin. I'm 16 legislative counsel at the D.C. office of 17 Earthjustice. I will be reading testimony prepared by 18 Paul Cort, the practice chair for our air practice 19 group at Earthjustice. We're also going to be filing 20 more robust technical comments, so this is just going 21 to be a brief summary. 22 We welcome EPA's action to remove the 23 numerous state exemptions that have excused pollution 24 violations caused by startups, shutdowns, and 2523

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- 4888 malfunctions. These loopholes undermine the public 1 health and welfare guidelines and guarantees of the 2 Clean Air Act. The Clean Air Act envisions a state

3 federal partnership in ensuring that areas with 4 unhealthy air quality clean up pollution, but this 5 deference to states has been abused and used as an 6 excuse to ignore practices that undermine the more 7 basic goals and promises of the Act. 8 We agree with EPA that the Act compels EPA 9 to remove SSM exemptions from state implementation 10 plans. We disagree, however, with the proposed 11 conclusion that some affirmative defenses can be 12 retained where they are limited to a defense against 13 penalties for unavoidable malfunctions. We will 14
submit our legal comments in writing. 15 Today, I just want to focus on the reasons 16 why EPA's decision to allow these affirmative defenses 17 is bad policy. There can be no dispute that 18 malfunctions injure public health and welfare. It 19 does not matter that they are accidents or that they 20 are unplanned. When those events result in spikes in 21 pollution, the surrounding communities suffer and 22 sometimes in horribly tragic ways. 23 As such, EPA policy should be to minimize 24 these events. EPA acknowledges in the propo sal that 2524

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- 4888 "Removal of [the] monetary incentive to comply with 1 the SIP reduces a source's incentive to design, 2 operate, and maintain its facility to meet emission 3 limitations at all times" (78 Fed Reg. at 12485). 4 This incentive applies equally to malfunctions. 5 Sources can be designed to be more or less failsafe. 6 Even when accidents happen, the consequences can be 7 more or less severe depending on the investments and 8 the decisions that the source has made in anticipation 9 of such upsets. 10 These decisions regarding

-- are cost
11 benefit calculations made by the sources, the costs of 12 building in safety compared to the risks and costs of 13 failure. Allowing states to waive penalties for 14 malfunctions undermines the incentives to make sure 15 accidents simply don't happen. So why would EPA allow 16 such exemptions? 17 The theory seems to be one of fairness. But 18 nothing prevents enforcement agencies or the courts 19 from exercising such notions of fairness. EPA's 20 approach short
- circuits that case

- specific analysis 21 for no apparent reason other than to undermine the 22 preventive incentives that penalties provide. EPA 23 should abandon the proposed distinction between 24 planned and unplanned events and remove all exemptions 2525

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- 4888 and affirmative defenses from these SIPs. 1 Thank you, and that's the conclusion of my 2 testimony. 3 MR. DOUGHERTY: Thank you. Thank you very 4 much. Our next speaker isn't until 10:30, so we will 5 break until then. 6 (Whereupon, a brief recess was taken.) 7 MR. DOUGHERTY: Let me call Jeff Holmstead. 8 MR. HOLMSTEAD: Well, thank you for giving 9 me the chance to speak today. I'm a little behind 10 schedule because I think the wrong address may have 11 been on the
-- so I went to the other building. 12 MR. DOUGHERTY: I apologize for that. 13 MR. HOLMSTEAD: No, no. I just

-- you would 14 think I would know where I was going. My name is Jeff 15 Holmstead. I'm speaking this morning on behalf of the 16 Electric Reliability Coordinating Council. 17 MR. DOUGHERTY: Just a second, Mr. 18 Holmstead. Is the microphone turned on so that other 19 people can hear? I'm sorry. I can barely hear myself 20 over the rain. 21 MR. HOLMSTEAD: Yes. 22 (Pause.) 23 MR. HOLMSTEAD: All right. Can you hear me 24 better now? 2526

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- 4888 MR. DOUGHERTY: That's better, okay. With 1 all that rain, it was hard to hear. 2 MR. HOLMSTEAD: All right. No. I thought 3 that was maybe something that Bruce Buckheit arranged 4 to drown out my testimony. But as I think the two of 5 you know, I've worked on Clean Air Act issues for 6 almost 25 years as a member of the White House staff 7 during the debate over the enactment and 8 implementation of the 1990 amendments, then as an 9 attorney in private practice, and also as the head of 10 EPA's Air Office from 2001 to 2005. 11 As I've said many times, I have a great deal 12 of respect for my former colleagues at EPA and do 13 recognize that they do a great deal of important work 14 to protect human health and the environment. The 15 proposed SIP calls unfortunately do not fall into this 16 category and in my view represent EPA at its worst. 17 As the result of private negotiations 18 between EPA and a single environmental group, EPA now 19 proposes to impose a very substantial burden on 36 20 states by forcing them to change regulatory provisions 21 that were previously approved by EPA and in most cases 22 have worked quite well for many decade s. 23 This is especially troubling in light of the 24 fact that these SIP calls at least according to EPA 2527

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- 4888 will have little or nothing to do to improve air 1 quality or public health. As the proposal itself 2 makes clear, EPA and states already have all the tools 3 they need to regulate emissions that occur when a 4 plant is starting up or shutting down. There's never 5 been any question about EPA's ability to impose 6 injunctive relief. 7 So the only purpose as far as I can see of 8 the proposed SIP call is to make it easi er for a 9 handful of environmental advocacy groups to bring 10 lawsuits seeking monetary penalties. If EPA finalizes 11 these SIP calls as proposed, 36 states will be forced 12 to use their limited resources to go through a long 13 and cumbersome regulatory process that in the end will 14 do nothing to improve public health or the environment 15 but will enrich a small group of plaintiffs' lawyers. 16 This strikes me as a silly waste of time and 17
resources. 18 But it's not just a waste of time and 19 resources. It also represents, I think, a fundamental 20 shift in the balance that Congress struck in the Clean 21 Air Act between states and EPA. Congress and a number 22 of courts, including the Supreme Court, have made it 23 clear that states do have broad discretion in terms of 24 how they deal with sources of emissions within their 2528

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- 4888 boundaries, and EPA cannot force a state to change its 1 SIP unless the SIP is "substantially inadequate, one, 2 to attain or maintain a national ambient air quality 3 standard; or two, substantially inadequate to comply 4 wi th certain specific enumerated requirements in 5 section 110 of the Clean Air Act," unquote. 6 Now this proposal does not say that these 7 provisions somehow make the SIP substantially 8 inadequate to attain or maintain the NAAQS. Instead, 9 EPA has apparently di scovered a new requirement in 10 section 110 that EPA is now announcing for the first 11 time in the proposed SIP call. Apparently, the Clean 12 Air Act makes it very clear that states must allow 13 lawsuits to be brought to seek monetary penalties for 14 emissions that occur during startup and shutdown even 15 though state environmental officials believe that 16 there is nothing that can be done to reduce these 17 emissions. 18 This is puzzling to think that a 19 disagreement over this issue has now made 36 state 20 implementation plan s substantially inadequate. In the 21 proposed SIP calls, EPA finds fault with any SIP that 22 provides state officials with any discretion in 23 deciding whether monetary fines should be imposed for 24 emissions that occur when a plant is starting up or 2529

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- 4888 shutting down. 1 This actually is amazing to me, that EPA is 2 critical of allowing even this little bit of amount of 3 discretion for state officials when in recent years 4 EPA has claimed enormous discretion for itself over a 5 number of matters that are much more important in 6 terms of protecting air quality. So EPA apparently 7 can exercise enormous discretion where states can't 8 even have this little bit of discretion. 9 Perhaps as troubling as the substance is the 10 process by which the SIP calls were developed. They 11 were is sued, as I mentioned before, as a result of 12 negotiations. EPA is very clear about that. And so 13 apparently while there have been ongoing discussions 14 between one environmental advocacy group and EPA 15 officials now for over two years, the states who are 16
now being told that they have 30 days to comment on 17 this proposal have been left out of that process. 18 I think it is troubling that now after more 19 than two years of apparent discussions between EPA and 20 Sierra Club, the 36 states that are affected now have 21 been told they have only 30 days to deal with this 22 fundamental shift in the way the Clean Air Act works. 23 So I just find it troubling that at a time when EPA 24 has limited and diminishing resources, when states 2530

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- 4888 have limited and diminishing resources, we're being 1 told that people need to spend their time focusing on 2 this as a nonissue that really only matters to a small 3 group of people that like to bring lawsuits. 4 So, as you may have inferred from my 5 comments, I'm not in favor of the proposal. I think 6 at the very least EPA is going to be under some 7 pressure to allow for additional time for comment 8 beyond the 30 days. So, at the very least, I think 9 that's something that states and companies who are 10 affected by these changes deserve. So, if you have 11 any questions, I'd be happy to answer. 12 MR. WILCOX: Mr. Holmstead, thank you very 13 much for your testimony. We assume you'll be giving 14 us more detailed written comments. 15 MR. HOLMSTEAD: Yes, we will be. Thank you. 16 MR. WILCOX: Great. Thank you very much. 17 MR. DOUGHERTY: Bruce Buckheit. 18 MR. BUCKHEIT: Good morning. Thank you for 19 the opportunity to comment on EPA's proposed response 20 to the petition filed by the Sierra Club requesting 21 that EPA address a number of allegedly deficient 22 startup, shutdown, and malfunction state 23 implementation plans. 24 My name is Bruce Buckheit, and I reside in 2531

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- 4888 Fairfax, Virginia. From 1984 until 2003, I served as 1 the Senior Counsel in the Environmental Enforcement 2 Section of the Justice Department prosecuting 3 violations of the nation's environmental statutes, 4 including the Clean Air Act. 5 Subsequently, I served as the Director of 6 EPA's Air Enforcement Division. I coordinated 7 headquarters and regional enforcement activities with 8 state and local air program managers to advance the 9 efficacy and efficiency of both federal and state 10 programs. 11 Since my retirement from federal service in 12 2003, I have worked as a consultant in energy and 13 environmental issues for a broad range of clients, 14 including federal and state agencies, corporations, 15 and NGOs. I also served a four
- year term as a member 16 of Virginia's Air Pollution Control Board, which under 17 Virginia statutes oversees the Virginia DEQ and the 18 implementation of Virginia's air program. 19 The remarks that I provide today are based 20
on my years of experience in these matters and do not 21 represent views of any organization other than myself. 22 In other words, I'm speaking on behalf of myself. And 23 I find that for not the first time in the past decade 24 I disagree with my former colleague, Mr. Holmstead, as 2532

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- 4888 to the appropriateness of addressing the deficiencies 1 in the SIPs that the Sierra Club has identified. 2 The SIP provisions that the Sierra Club has 3 identified are inconsistent with the Clean Air Act as 4 a matter of law, and they're poor policy choices as a 5 matter of policy. EPA's proposal to correct these 6 deficient SIPs is long overdue and should be adopted 7 without delay. 8 Prior to 1955, state and local governments 9 were solely responsible for addressing the problem of 10 air pollution and developing regulations to address 11 excessive air pollution. In 1955, a federal presence 12 was commenced with the Air Pollution Control Act of 13 1955, which provided limited research and development 14 capabilities but no broad oversight authority. 15 In the decades or s o that followed, it was 16 widely understood that state regulation by itself of 17 air pollution failed. And so the 1970 Clean Air Act 18 established a strong federal presence, defined 19 specific targets and established obligations on the 20 newly created EPA to maintain a level playing field 21 among states and prevent the race to the bottom that 22 had prevented or interfered with state efforts to 23 address the problem in the first instance. 24 While section 101 of the Clean Air Act does 2533

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- 4888 contain hortatory language suggesting that Clean Air 1 Act protections are the primary responsibility of the 2 states, the first listed purpose of the Clean Air Act 3 is to protect and enhance the quality of the nation's 4 air resources. 5 Importantly, the Clean Air Act does not 6 merely encourage states to submit SIPs or say that 7 they should submit SIPs. It says that they shall 8 submit SIPs. While it's left to state and local 9 authorities to determine the best mix of pollution 10 controls and where and which sources should be 11 controlled to meet defined budgets, it is not left to 12 states to determine that compliance should be 13 voluntary or should be based on encouragements. 14 Rather, the SIPs under the Clean Air Act 15 must contain enforceable emission limitations 16 sufficient to meet the Clean Air Act's requirement s on 17 a continuous basis. Further, the Clean Air Act 18 mandates, that is to say, it requires that EPA review 19 and approve each SIP. And the Clean Air Act states 20 that EPA shall require, shall require

-- it's not 21 optional on EPA's part. EPA shall require a state to 22 revise a SIP whenever it finds that that plant is 23 substantially inadequate. 24 Thus, one good reason for EPA to make the 2534

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- 4888 SIP corrections suggested by the Sierra Club petition 1 is that as a law enforcement agency EPA should itself 2 comply with the law a s set out in the Clean Air Act. 3 At its core, the Sierra Club petition 4 identifies a number of state SIP provisions that are 5 identical to SIP provisions that EPA has determined to 6 be inadequate and rejected. These broad startup, 7 shutdown, malfunction, scheduled maintenance, and 8 director discretion issues have been identified in 9 several public policy determinations over the years 10 and in a number of SIP disapprovals over the time. 11 While it can be argued that nothing in the 12 Clean Air Act requires EPA to go back over the past 30 13 years and root out and find all the errors that may 14 have crept into the program, once this issue is put in 15 front of it squarely by the Sierra Club petition, it's 16 difficult to see how EPA could deny the petition 17 without reversing 30 years of policy as set out by the 18 Bennett and Herman memoranda. 19 EPA's written policy on excess emissions 20 during startup and shutdown relies on the statutory 21 requirement that sources must comply with emission 22 limits at all times. EPA's policy does not require 23 that sources comply with emission limitations that are 24 technically infeasible. And so this whole proceeding 2535

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- 4888 is not about attempting a game of gotcha where sources 1 can be caught up with emission limitations that they 2 can't meet but rather in an effort to provide more 3 accurate and technically sound emission limitations so 4 that these broad
-based exemptions don't result in a 5 broad category of emissions that simply aren't 6 captured by the program. 7 For example, oftentimes NAAQS control 8 devices in particular require that the operating unit 9 be up to a certain temperature before you start 10 injecting ammonia, and so it is reasonable to provide 11 specific startup provisions for that kind of an 12 operation. But there's nothing in the technology of, 13 for instance, a fabric filter that would require that 14 kind of exemption based on temperature. 15 A broad
-based exemption that just covers 16 startup periods exempts both of these technologies, 17 and obviously the latter technology, there's no need 18 for that. Similarly, when permitting authorities pay 19 attention to startup issues, you see provisions such 20 that, for example, coal
- fired sources must start up on 21 natural gas, or oil

- fired units are not

-- oil is not 22 allowed to be fired because it would clog an ESP, for 23 instance. And thos e kind of technical limitations are 24 what we're talking about addressing, specifically 2536

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- 4888 through better permitting. 1 Perhaps the most important reason to correct 2 the deficient SIPs is that it's good policy. 3 Obtaining optimum emission reductions from already

4 installed pollution control devices is highly 5 efficient. Correcting the SIPs, as suggested by the 6 Sierra Club, also provides a level playing field with 7 those states that have complied with the Clean Air Act 8 and are currently disadvantaged in that race to the 9 bottom when competing for new industry in the states 10 that have the deficient SIPs. 11 Here it should be understood that where 12 pollution controls that achieve a 90 to 99 percent or 13 better control efficiency, bypassing those controls 14 could substantially increase emissions. For example, 15 bypassing a PM control device with a control 16 efficiency of 99.8 increases the emission factor by

-- 17 increases the emission rate by a factor of 500 over 18 uncontrolled and the modeled emission rates. 19 Thus, bypassing that fabric filter or ESP 20 for just 1.5 hours a month doubles the annual PM 21 emissions from the unit, and at 500 times the normal 22 emission rate, such emission rates can threaten short

23 term national ambient air quality standards as well. 24 Startup and shutdown polic ies should also 2537

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- 4888 reflect the fact that startup times for large coal

1 fired units can approach or exceed 24 hours, that 2 simple cycle turbines can go through several shorter 3 startup and shutdown cycles each day, and that batch 4 processing operations at syntheti c chemical 5 manufacturing facilities can spend the majority of 6 their time in startup and shutdown modes. 7 Under broadly structured startup and 8 shutdown provisions, these emissions are not reliably 9 tracked or accounted for in the SIP demonstration 10 modeling, and that is a key point. It is not that one 11 should expect a control technology to operate at 100 12 percent effectiveness at all times. It's that you 13 understand when they can't operate at full capacity, 14 and you account for those excess emissions in the SIP 15 demonstration process. 16 Those emissions are real. They show up in 17 the air we breathe and in the monitoring that 18 ultimately demonstrates whether or not the SIP has 19 been achieved. Eliminating the broad exemption for 20 startup and shutdown will not lead to the imposition 21 of infeasible obligations but simply focus the 22 attention of permitting authorities and lead to a set 23 of requirements that is tailored to the particular 24 technology that is in place. 2538

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- 4888 It should be noted that a number of states 1 have for several decades enforced SIPs that do not 2 contain an exemption for startup and shutdown 3 operations, and I'm unaware of any significant 4 difficulty that those SIPs have presented either for 5 the permitting authorities or for the states

-- for 6 the sources located in those states. 7 Now EPA has proposed to alter the existing 8 policy to provide for the imposition of civil 9 penalties for failure to comply with emission 10 limitations during startup and shutdown. This is 11 entirely appropriate since such limitations will 12 refle ct the performance and operating practices that 13 are expected during startup and shutdown given the 14 limitations of the technology. 15 Thus, for instance, where a source has a 16 permit that instructs it only to fire natural gas 17 until a certain operating temperature is reached, if 18 that source violates that restriction, it's like any 19 other restriction in the permit and should be treated 20 no differently. I mean, the key here is to tailor the 21 operating limitation to what the technology can do. 22 There was a pitched battle in the '70s over 23 whether compliance was to be continuous or 24 intermittent. This was a highly visible confrontation 2539

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- 4888 that TVA led the charge on, and it went on for some 1 time. It was a highly visible activity. For this 2 reason, the inclusion of the continuous compliance 3 language in section 110 is not to be dismissed 4 lightly. 5 As with startups and shutdown, any 6 malfunction event that leads to a bypass of a 7 pollution control device or operation of a process 8 unit without a functioning control device can result 9 in dramatically increased emissions that threaten both 10 long
- and short
- term max limits. 11 The Sierra Club petition identifies a number 12 of SIPs that are clearly deficient. Some extreme 13 examples include one state that exempts emissions from 14 failure o f any component at a facility, irrespective 15 of whether the source had attempted to minimize 16 emissions, and another where emissions are exempted so 17 long as they are infrequent or brief. These are 18 subjective terms that cannot be reliably enforced. 19 One SIP limits malfunction excuses to 15 20 percent of the operating time of the unit, implicitly 21 authorizing exempted emissions many times the 22 permitted limits of facilities in that state. Such 23 releases can also pose substantial threats to the 24 public health beyond the NAAQS through uncontrolled 2540

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- 4888 releases of benzene, chromium, and other hazardous air 1 pollutants that are otherwise captured by the 2 pollution controls required under the SIP. 3 A weakness experience with uncontrolled 4 flaring in refinery enforcement initiative of a decade 5 ago shows that with proper attention by management the 6 frequency of malfunction events can be substantially 7 reduced. Emission during malfunction events should 8 not be exempt but should be covered so that it is 9 clear to permitting agencies and sources that 10 preventive agency programs can be developed and 11 required where appropriate. 12 The penalty issue during the time of 13 malfunction is a little more complicated issue. EPA 14 has proposed to retain its current policy for penalty 15 assessments that occur as a result of malfunction 16 events. On its face, this exemption is neither lawful 17 nor necessary because if emissions are in fact covered 18 by a SIP, then section 113 is pretty clear that 19 exceedances of the SIP limit are subject to 20 enforcement action, including penalties. 21 Additionally, it doesn't seem appropriate to 22 instruct an Article III judge in penalty issues where 23 Congress does not. And yet it seems foolish to 24 suggest that a source should be subject to penalties 2541

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- 4888 for an occurrence that is entirely beyond its control, 1 and at least one court has endorsed EPA's approach. 2 In many federal programs, this issue is 3 addressed by way of grants of enforcement discretion 4 where EPA in effect authorizes the use of 5 noncompliance gasoline during or after a blizz ard or 6 additional hours of operation has occurred. 7 MR. DOUGHERTY: I'm sorry, Mr. Buckheit. We 8 are required to keep public statements to about a 10

- 9 minute minimum. 10 MR. BUCKHEIT: Okay. 11 MR. DOUGHERTY: We will accept any written 12 comments you have, though, at any length. 13 MR. BUCKHEIT: Thank you. I will submit the 14 rest of my comments for the record. 15 MR. DOUGHERTY: Thank you, Mr. Buckheit, for 16 your comments. And any other speaker who had more 17 extended comments who'd like to pass forward now

-- 18 Mr . Buckheit was our last registered speaker of the 19 morning, so anyone else feel free to step forward. 20 MR. WILCOX: Mr. Dowd, would you have more 21 that you would want to say since you're with us? Do 22 you want to add to your comments since you're still 23 with us? Okay. 24 (Whereupon, a luncheon recess was taken.) 25 2642

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- 4888 A F T E R N O O N S E S S I O N 1 (2:00 p.m.) 2 MR. DOUGHERTY: Good afternoon. My name is 3 Joseph Dougherty, and I'm representing the EPA's 4 Office of Air Quality Planning and Standards. Joining 5
me on the panel is Geoff Wilcox, representing the 6 Office of General Counsel. 7 I'll run through the introduction more 8 briefly than this morning. Thank you all for 9 attending this public hearing held by the U.S. EPA. 10 We're holding this hearing to take comment on EPA's 11 proposed rulemaking entitled, "State Implementation 12 Plans: Response to Petition for Rulemaking; Findings 13 of Substantial Inadequacy; and SIP Calls to Amend 14 Provisions Applying to Excess Emissions During Periods 15 of Startup, Shutdown, and Malfunction ." 16 This proposed rulemaking concerns the 17 treatment of excess emissions of air pollution that 18 may occur when an industrial facility is starting up 19 or shutting down or when a malfunction occurs, 20 specifically, how those emissions are treated in state 21 implementation plan provisions. Air pollution emitted 22 during these periods of startup, shutdown, or 23 malfunction may adversely affect the health of people 24 nearby and may contribute to smog and other problems 2543

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- 4888 in communities that are further downwind. The 1 proposed rulemaking was published in the Federal 2 Register on February 22, 2013, at page 12460. 3 At today's hearing, we're accepting oral 4 comments on the EPA's proposed rulemaking, and we'll 5 be preparing a written transcript of this hearing. 6 The transcript will be available to the public as part 7 of the official record of this rule, and EPA will 8 consider both oral comments and written comments as we 9 move forward in the rulemaking process. 10 We're accepting written comments on the 11 proposed rule until April 11, 2013 . We have a fact 12 sheet available in the registration area that 13 summarizes our proposed action. It includes detailed 14 information for submitting written comments. If you 15 wish to speak but have not already registered to do 16 so, please check in with our staf f at the registration 17 table located just outside the entrance to this room. 18 We intend to stay until either 6 p.m. this 19 evening or one hour after the last registered speaker 20 has spoken, whichever is later. 21 Again, thank you for participating in our 22 publi c hearing today. I'll now reopen the floor for 23 oral testimony. We ask that you limit your testimony 24 to no longer than five [ sic ] minutes. We have a 2544

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- 4888 little light up here that helps you out. It goes 1 green, then yellow, then red. And first is Leslie 2 Ritt s. 3 MS. RITTS: Five minutes? I thought it was 4 10. We'll just get through it. 5 MR. DOUGHERTY: We will cut you off promptly 6 in time just in general. 7 MS. RITTS: Thank you. I'm here 8 representing the National Environmental Development 9 Association's Cl ean Air Act Project. We're a 10 multisector manufacturing coalition, and we've been 11 around since 1979. Our goal is to offer a balanced 12 perspective on protecting the environment while giving 13 appropriate attention to issues that manufacturers 14 face in the global economy. 15 We appreciate the opportunity to testify on 16 the proposed findings of SIP inadequacies and the SIP 17 call to amend state provisions to exclude from 18 violations excess emissions during SSMs. I will refer 19 to startup, shutdown, and malfunctions as SSMs, as I'm 20 sure many of the speakers have already. 21 We also appreciate the opportunity to 22 comment on the availability of the affirmative defense 23 if excess emissions occur during at least 24 malfunctions, which petitioners seek to have 2545

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- 4888 rescinded. NEDA/CAP' s members own and operate plants 1 throughout the country and thus are subject to the SIP 2 requirements as well as national emission standards 3 and requirements and are directly affected by both 4 regulatory and legal issues in this rulemaking 5 package. 6 The subject of this rulemaking and the 7 Petition for Rulemaking filed by citizen groups 8 addresses the startup, shutdown, and malfunction of 9 plant process equipment. EPA's SSM policy has been an 10 issue of concern to our members since 1982

- 83 when 11 Assistant Administ rator Kathleen Bennett issued 12 guidance documents to regional EPA offices and the 13 states regarding emission violations during SSMs. 14 At this time, our members have been

-- since 15 that time, NEDA's members have been in lengthy 16 discussions with Agency officials regarding 17 significant concerns that plants have during startup 18 and shutdown of process equipment and also the 19 emission consequences of malfunctions when process 20 equipment malfunctions make it critical to vent to 21 atmosphere in order to prevent harm to employees and 22 process equipment. 23 We've been particularly proactive in 24 reducing emissions from flaring frequently associated 2546

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- 4888 with certain types of SSM events and in designing SSM 1 plants and O&M procedures for process equipment to 2 prevent excess emissions. Beyond reducing the need 3 for flaring, it should be noted that when new 4 industrial processes are designed or modified, 5 rigorous evaluations are undertaken by the companies 6 to identify potential issues and risks that can occur 7 during startup and shutdown and to design and maintain 8 equipment to minimize those risks. 9 In 1999, NEDA/CAP challenged EPA's excess 10 emissions policy in the D.C. Circuit as an unlawful 11 rulemaking because of the policy's significant legal 12 and operational consequences to our members. That 13 litigation led to an agreement that EPA would apply 14 the 1999 guidance policy prospectively but not 15 retroactively to state and local air pollution 16 requirements that the Agency already had approved in 17 prior SIP actions. 18 Our other concern was that the po licy 19 impermissibly interfered with state discretion to 20 decide its own SIP strategy, including how each state 21 established technology

-based standards and limits on 22 EPA's authority and, excuse me, their SIP strategies, 23 including how each one established technology
-based 24 emission standards and limitations, and that EPA's 2547

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- 4888 authority was limited to thereafter approving or 1 disapproving such strategies absent evidence of NAAQS 2 violations, in which case other procedures for 3 redesignation in new SIP planning figured in. 4 Even with the notice and opportunity EPA is 5 now providing for comments on these SIPs and SIP 6 calls, without evidence that SSM exclusions violate a 7 NAAQS, we believe EPA's proposed action is 8 inconsistent with the Clean Air Act, its legal 9 structure, and its federalist underpinnings. 10 The February 2013 proposed findings of SIP 11 deficiency and associated SIP calls are of even 12 greater concern to NEDA/CAP because of their effect on 13 startups and shutdowns for process equipment. The 14 proposed rule would require states to remove general 15 exclusions for startups and shutdowns because EPA 16 argues those SIP emission limits are continuous 17 operating requirements even though when states adopted 18 the measures they were not intended to be continuous 19 operating requirements. 20 Like the federal NSPS, such emission limits 21 were set historically for normal representative 22 operations and thus excluded emissions, including 23 excess emissions, during equipment startup and 24 shutdown. While most equipment is not turned on any 2548

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- 4888 longer by l ighting a fire in a fire box, process 1 equipment also is generally not started by flipping on 2 a switch. 3 Most equipment has to be evaluated and 4 warmed up before it is used, and purging the equipment 5 of dust and other fine particles or VOCs left from 6 reacti ons or to prevent contamination to the equipment 7 from other processes when the equipment is campaigned 8 for other products prevents fires and potential 9 explosions that can be dangerous. Add to the fact 10 that few plants in the U.S. run three shifts a day and 11 they shut down to conserve raw material resources and 12 energy, it's also critical for EPA and the public to 13 be aware of these facts in the context of this 14 proposed action. 15 We'd like to call EPA's attention to the 16 fact that the NSPS shutdown provisions highlight that 17 operations during periods of SSM shall not constitute 18 representative conditions for the purpose of 19 performance tests, nor shall emissions in excess of 20 the level of the applicable emission limit during 21 periods of SSM be considered a violation o f the 22 applicable emission limit unless otherwise specified. 23 Removal of excess emission exclusions for 24 startup, shutdown provisions in the SIPs necessarily 2549

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- 4888 makes the standards tighter and violates the Clean Air 1 Act's provisions by disallowing state discretion for 2 them to design their own SIP strategies. 3 As NEDA/CAP will detail in our written 4 comments, many NSPS and MACT requirements now include 5 detailed SU/SD procedures following the Court's 6 decision vacating the general MACT SSM provisions in 7 Sierra Club v. EPA . NEDA was a party in that case. 8 For instance, in the gas turbine NSPS, the 9 standards exclude emissions during SU/SD from the 10 standards for important technical reasons. Many 11 turbines use steam injection and SCR technologies to 12 reduce NOx emissi ons. So during the startup of a 13 diffusion flame stationary combustion turbine at a 14 cogeneration facility, which generates steam for use 15 at the facility as well for steam injection in the 16 turbine engine itself, it takes time for the hot air 17 to start from the turbine to generate steam necessary 18 for NOx emission reduction in the turbine. 19 In addition, it takes time for exit 20 temperatures of the hot air in the SCR ductwork to 21 stabilize to the proper temperature necessary for 22 effective SCR/NOx reduction. There is no way for this 23 type of system or many similar systems to meet the NOx 24 emissions limits during startup or shutdown. 2550

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- 4888 Let me cruise forward, and you can read some 1 of the testimony yourself. We think it's extremely 2 troubling that EPA has given little thought to the 3 resources that the state and local agencies will need 4 to direct to the SIP provision process if the proposed 5 actions are finalized. 6 In the aftermath of Sierra Club v. EPA , 7 vacating the general MACT provisions, the Agency and 8 DOJ combed through all the MACTs that had been issued 9 identifying first whether the NESHAPs relied on the 10 general MACT SSM exclusion by incorporating 40 C.F.R. 11 63.6(e) by reference, then reviewing the specific 12 provisions of either

-- of other NESHAPs, excuse me, 13 that did not incorporate the SSM exclusion by 14 reference. 15 Then the Agency reopened most of the latter 16 MACTS for industries on which the Agency relied on the 17 63.6 exclusion, and with industry consultation, 18 emissions testing, and other resources, modified those 19 standards for which emissions increases were valid to 20 expect during startup and shutdown. 21 States don't have the resources to rectify 22 emission standards which were adopted and approved by 23 EPA historically to graft onto those standards the 24 existing startup and shutdown provisions. And this 2551

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- 4888 notice doesn't even hint that this is what a state 1 will be required to do to allow most industries to 2 continue to operate their equipment so as not to be in 3 violation of a RACT or other technology

-based 4 requirement. 5 The proposed action also doesn't consider 6 the impact or the cost of removing SSM SIP exclusions 7 from existing operating permits. The rulemaking 8 mentions only state requirements adopted under 40 9 C.F.R. 70.6(g) applicable to emergencies, not to these 10 types of malfunctions. The rule does not consider the 11 fact that Congress intended that the Title V operating 12 permits mirror Clean Air Act requirements, including 13 those in the SIPs. 14 Removal of the existing air pollution 15 control standards adopted and implemented by the 16 states in the federal operating permits will pose 17 additional significant compliance and operational 18 difficulties and administrative costs, largely because 19 those requirements are found in the general 20 provisions. 21 We're going to

-- would you like me to stop? 22 MR. DOUGHERTY: I'm sorry. I do have to cut 23 you off. I'm sorry. 24 MS. RITTS: Okay. I thought I had 10 2552

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- 4888 minutes, so I apologize. We want to definitely 1 support the affirmative defenses. 2 MR. DOUGHERTY: We will definitely accept 3 all written comments and your full comments at this 4 time. 5 MS. RITTS: We'll submit full written 6 comments, especially on the affirmative defenses, but 7 I appreciate the opportunity to get up here and tell 8 you how exercised we are about this rulemaking. 9 MR. DOUGHERTY: Thank you very much for your 10 comments. 11 MS. RITTS: Thanks very much. 12 MR. DOUGHERTY: Maxine Lipeles. 13 MS. LIPELES: Good afternoon. Thank you for 14 the opportunity to testify. My name is Maxine 15 Lipeles. I'm the Co

- Director of the Interdisciplinary 16 Environmental Clinic at Washington University School 17 of Law. We prepared the petition on behalf of the 18 Sierra Club that EPA is responding to in the proposed 19 rule, and we've had some direct experience in 20 particular on behalf of another client, the American 21 Bottom Conservancy, with a large steel facility in 22 Illinois subject to the Illinois SSM provisions, which 23 are proposed to be
-- or the petition proposes to 24 grant. 2553

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- 4888 And what I'd like to do for today is to 1 focus on that as kind of a case study of why this 2 proposed rule is so important to communities across 3 the country that are breathing these essentially 4 exempted excess emissions. So what I'd like to do 5 first is just give you a little bit of an overview of 6 the U.S. Steel facility in Granite City and just give 7 you a little bit of information about the 8 environmental justice context, and then I'm going to 9 go through some pictures. And a lot of my testimony 10 is going to be the pictures, and we'll submit some 11 written comments as well. And then I want to focus at 12 the end on the Illinois SIP provisions and how they 13 key into this. 14 So the U.S. Steel Granite City Works 15 facility is a very large iron and steel manufacturing 16 plant. It's in Granite City, Illinois, which is part 17 of the actually St. Louis metropolitan regi on. It's 18 on the eastern side of the Mississippi River, just a 19 few miles from the city of St. Louis. It's a large 20 industrial facility, as I said. It dates back to the 21 1890s, and it's surrounded by residences, schools, 22 parks. A hospital is right there. There are homes 23 right up against the plant on a couple of places. 24 It's adjacent to a large state park. And I'll show 2554

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- 4888 you pictures of all this. And it's the principal 1 source of the region being nonattainment for fine 2 particulate matter, including under the revised 3 standard for PM 2.5. 4 Here's some environmental justice 5 statistics. About 100,000 people live within five 6 miles of the plant. A little over half of those are 7 minority groups. Twenty

- three point six percent live 8 below the poverty line, which those numbers are quite 9 a bit lower than the county as a whole. So this shows 10 you the area right around the plant is 11 disproportionately minority and low income. 12 There are five schools within one mile of 13 the plant. Ninety

- five percent of the kids in tho se 14 schools are of minority background; 81 percent qualify 15 for free or reduced lunch. There's a preschool 16 directly across the street from the coke plant, which 17 is a high

-emissions unit. And there's an elementary 18 school just a few blocks from the plant. And I'm 19 going to show you a few pictures. 20 I've got first a couple of Google Earths to 21 just show you this in perspective. So you can see the 22 heavy industrial in the middle, and then above a 23 little bit to the left, above a little bit to the 24 right, and below you can see these are all sort of all 2555

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- 4888 residential areas. It's a large complex, so it needed 1 two Google Earth shots to be able for you to see it. 2 This is a map which has an overlay of 3 schools. The red flags are schools within proximity. 4 That sort of brown area is actually only part of the 5 plant because part of it is even below that. The 6 green is state park. You can see what's Horseshoe 7 Lake that used to be part of the Mississippi River. 8 It's an oxbow lake. And the land in the middle of it 9 is Horse shoe Lake State Park. About 350,000 people 10 use that state park each year. Many people fish in 11 the lake, and many people eat and rely on the fish 12 that they catch from that lake. 13 There's also some local parks and 14 playgrounds that are shown in lighter green, and the 15 blue trapezoid is the hospital right next to the 16 plant. This shot was taken at the end of a 17 residential street, so this is just to give you the 18 perspective of how close people live to the 19 manufacturing facility. There are houses to the 20 right, to the right and to the left as you're taking 21 this picture. 22 Now I've got a series of 10 pictures that 23 are going to show apparent malfunction events at the 24 facility, taken at different times by people that live 2556

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- 4888 nearby there. All these are taken from public places, 1 so the public is exposed to these sorts of emissions. 2 Okay, which leads us to the Illinois SIP. 3 The Illinois SIP has a provision that says you can't 4 operate during malfunction or breakdown, or you can't 5 operate during startup in violation of your limits 6 unless you have advance permission in your operating 7 permit. And so the SIP then sets up a provision where 8 they basically invite permit applicants to submit a 9 request for advance permission to violate their 10 limits. And that's just quoting from the statute up 11 there, permission to continue to operate during 12 malfunction or breakdown, and other language there 13 that shows when it will be at malfunction or breakdown 14 and will cause violations. And then for startups, it 15 just directly says violate, advance permission to 16 violate standards or limitations during startup. 17 And then a companion provision says if the 18 Agency grants permission to operate during malfunction 19 or breakdown or to violate limitations, that then 20 constitutes a prima facie defense to an enforcement 21 action. 22 So it's a pretty nice setup if you're the 23 facility. In your permit application, you say we're 24 going to have some trouble at some times. We're going 2557

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- 4888 to do our best, but we'd like advance permission to 1 violate the limits when we need to. And in the 2 permit, you have that language. And here's some 3 language from the U.S. Steel's Title V permit. 4 "Permittee is authorized to continue operation in 5 excess of applicable state standards in the event of a 6 malfunction or breakdown." That's written into the 7 permit in reliance on those SIP provisions. 8 Similarly, "Permittee is authorized to 9 violate the applicable standards during startup." We 10 have raised these issues with two successive Title V 11 petitions asking the EPA Administrator to object to 12 the permit on various grounds, including but not 13 limited to the SSM. Both times the EPA Administrator 14 in January 2011 and in December 2012 granted at least 15 in part the petition to object, both times including 16 the SSM language in there. And in neithe r time has 17 the Agency changed one word of the permit or that 18 language that's printed above there. The only thing 19 that's changed is the company gave some more 20 information, basically saying these are the situations 21 where we might have malfunctions or breakdowns. 22 But you can't know in advance what's going 23 to actually cause it, and you can't know in advance 24 what you're going to do in response to a malfunction 2558

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- 4888 or a breakdown. So you can't know that it's going to 1 meet the strict requirements that EPA has set forth, 2 whether it's going to be an affirmative defense or 3 this thing called a prima facie defense, which seems 4 to even go beyond an affirmative defense, or even 5 enforcement discretion. 6 In any event, this is one real

-world example 7 where you have a communi ty that can't move away from 8 this facility, that has to breathe in these excess 9 emissions on a regular basis, and incredibly weak SIP 10 provisions. So we very much support your effort to 11 require the state to upgrade their SIP to meet the 12 minimum requirement s of the Clean Air Act. 13 Thank you, and I'm sorry if I exceeded my 14 time. 15 MR. DOUGHERTY: No. Thank you very much. 16 MR. WILCOX: Thank you for coming in person 17 and testifying. 18 MS. LIPELES: Pardon? 19 MR. WILCOX: Thank you for coming in person. 20 MS. LIPELES: Oh, my pleasure. And I'll try 21 to remove this without interfering with the next 22 people. 23 MR. DOUGHERTY: Sparsh Khandeshi. 24 MR. KHANDESHI: Good afternoon. My name is 2559

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- 4888 Sparsh Khandeshi, and I'm an attorney with the 1 Environmental Integrity Proj ect. Our organization 2 believes that enforcement of environmental laws is an 3 essential and often neglected component within the 4 framework we set up for protecting the environment. 5 It is from this point of view that I'm providing 6 comments today. 7 First, I 'd like to start by thanking the EPA 8 for providing this public hearing and affording us the 9 opportunity to enter this testimony. EPA's proposal 10 to prohibit the startup, shutdown and maintenance 11 exemption from state implementation plans is a welcome 12 step forward. Furthermore, EPA's commitment to 13 ensuring that the affirmative defense is not an 14 exemption from federally approved emission limits but 15 instead a narrowly tailored shield for situations 16 where there are excess emissions that are wholly 17 outside the facility's control

-- and the shield only 18 protects the facility from monetary liabilities

-- is 19 a welcome and much needed clarification. 20 EPA's response to the Sierra Club's petition 21 correctly concluded that exemptions from startup, 22 shutdown, and maintenance violate the Clean Air Act. 23 In evaluating state responses to EPA's SIP call, any 24 changes that seek to weaken a federally approved SIP 2560

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- 4888 limit must comply with the Clean Air Act SIP provision 1 requirements, which include an opportunity for notice 2 and comment. 3 We are especially concerned about this 4 because of our experience with Clean Air Act 5 permitting in Texas where the state has incorporated 6 startup, shutdown, and malfunction emission limits 7 into permits that are weaker than the federally 8 approved SIP emissions limits without going through an 9 adequate notice and comment process. 10 Also, EPA must devise a strategy to ensure 11 that SIP emission limits that are expressed in terms 12 of throughput are enforceable during periods of 13 maintenance or other inactivity. For example, many 14 boilers can have significant PM emissions during 15 maintenance activities, but because these boilers have 16 emission limits that are conveyed in terms of a firing 17 rate, for example, pounds per MMBTU, enforcement 18 becomes difficult. 19 Neverthe less, emissions during these periods 20 in many cases are many times greater than the 21 emissions during normal operation in terms of pounds 22 released per hour. Unchecked, these emissions 23 threaten the achievement of ambient air quality 24 standards. 2561

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- 4888 With regards to the affirmative defense for 1 malfunctions, EPA must ensure that it is the narrow 2 exception that EPA asserts. In part, this will 3 require thorough documentation of malfunction events 4 that is submitted to state agencies and made publicly 5 available on the internet. Without this, vigilant 6 state and federal oversight would be impossible. 7 Last year's June 14 accident at the Exxon

8 Mobil Baton Rouge facility is a prime example of this. 9 While Exxon

-Mobil eventually disclosed that this 10 spill released 20,000 pounds of benzene, this 11 information only came to light after the community and 12 the Louisiana Bucket Brigade repeatedly requested LDQ 13 and EPA conduct a full investigation. 14 Communities shouldn't bear this 15 responsibility. Instead, state implementation plans 16 must require a full and accurate disclosure that can 17 be reviewed by the state, federal agencies as well as 18 the public. In addition to accurate reporting, state 19 and federal agencies need to take enforcement 20 seriously. Data from Texas illustrates the pitfalls 21 of combining an affirmative defense and weak 22 enforcement. 23 For example, over the past four years, four 24 facilities, the Keystone Gas Plant, the Mallet CO 2 2562

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- 4888 Recovery Plant, Exxon
-Mobil's Beaumont refinery, and 1 the Goldsmith Plant have consistently been among the 2 top 10 sources of excess emissions. Together, these 3 four facilities release nearly 7,000 tons of emissions 4 per year on average, which in sum total accounts for 5 nearly 25 percent of all reported excess emissions in 6 Texas between 2009 and 2012. 7 S o there are a few very bad actors, and we 8 shouldn't allow them to hide behind the affirmative 9 defense just using it as a veil to disguise inadequate 10 maintenance and poor operating practices. Thank you. 11 MR. DOUGHERTY: Thank you. 12 MR. WILCOX: Will you be submitting more 13 written comments? 14 MR. KHANDESHI: Yes. 15 MR. WILCOX: Okay. Thank you. 16 MR. DOUGHERTY: Tamara Evans. 17 MS. EVANS: My name is Tamara Evans. I'm 18 here on behalf of the environmental law program at 19 Sierra Club. I'm here to express st rong support for 20 EPA's proposed rule. This rule will help achieve the 21 clear intent of Congress and the Clean Air Act. 22 The central purpose of the Clean Air Act is 23 to protect human health. Ambient air quality 24 standards are the heart of the Clean Air Act. Air 2563

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- 4888 quality standards are set at levels to protect public 1 health and welfare, including protection of the most 2 sensitive populations, such as asthmatics, children, 3 and the elderly. State plans must include emissions 4 limitations to ensure attainment of the ambient air 5 quality standards. Illegal loopholes in state plans 6 allow facilities to emit pollution at levels that 7 cause the pollution in the air to far exceed ambient 8 air quality standards. This is contrary to the 9 fundamental purpose of the Clean Air Act. 10 To help encourage industry to comply with 11 air quality standards, the Act allows EPA as well as 12 citizens to bring enforcement actions against 13 facilities that violate emissions limitations. EPA 14 and citizen enforcement actions have always been an 15 impo rtant part of achieving the goals of the Clean Air 16 Act. 17 However, many states give polluters a free 18 pass from these enforcement actions in the form of 19 automatic exemptions as well as affirmative defenses 20 for violations. For example, the Florida State 21 Implementation Plan contains automatic exemptions for 22 excess emissions from startup, shutdown, and 23 malfunction events. 24 The state rules actually permit excess 2564

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- 4888 emissions. This is contrary to the fundamental 1 requirement that all excess emissions be considered 2 violations. Many states have affirmative defense 3 provisions that allow facilities to avoid any 4 penalties for violation of their permit limits. These 5 provisions are inconsistent with the Clean Air Act 6 because they limit a court's ability to assess 7 penalt ies for violations of the Act under section 8 113(e)(1). 9 EPA's proposed rule will help close these 10 loopholes that interfere with the enforcement 11 mechanisms of the Clean Air Act. If EPA does not act 12 to close these loopholes, the objectives of the Clean 13 Air Act will not be achieved. Minimum ambient air 14 quality standards will never reliably be met, and 15 people will continue to be subjected to unsafe levels 16 of air pollution. Thank you. 17 MR. DOUGHERTY: Thank you very much. 18 Terry McGuire. 19 MR. MCGUIRE: Good afternoon. My name is 20 Terry McGuire, and I'm a Washington representative 21 with the Sierra Club. And I want to thank you for the 22 opportunity to provide comment on this action, which 23 I'm here to strongly support. Upsets are a serious 24 problem at many fac ilities around the country, 2565

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- 4888 including large refineries, chemical plants, and coal

1 fired power plants. These events result in an 2 exceptional burst of pollution over a short period of 3 time that is often many times above the legal limits. 4 Because these fac ilities are frequently 5 located in low

- income communities of color, this 6 action by EPA will improve the lives of people that 7 live in some of the most disadvantaged neighborhoods 8 in our country. So today I want to add a human face 9 to this issue and share wi th you a few stories from 10 people that Sierra Club has been in touch with that 11 will benefit from this rule. While they could not be 12 here in person, they wanted their stories heard, and 13 they have given us permission to relay their 14 experiences. 15 Sherry Griswold lives in Detroit, Michigan, 16 near the Marathon Petroleum Corporation complex. In 17 fact, her home is only 700 feet away from this 18 enormous facility. For the last five years, Sherry 19 tells us that she has been tormented by relentless 20 flaring from this facility, usually about three times 21 a night. When these events occur, 20

- foot flames 22 erupt from the flares and are accompanied by a loud 23 howling noise. 24 Sherry says these events happen with such 2566

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- 4888 force that they have shaken loose her ceiling tiles, 1 and once , while she was in her backyard, a flaring 2 literally knocked her to the ground. Perhaps most 3 disturbingly, Sherry tells us that when she is outside 4 for an extended period of time, her skin sometimes 5 becomes coated with a fine layer of soot. 6 Sadly, becau se of the frightening nature of 7 these events and a concern for her family's health, 8 Sherry no longer has her children or grandchildren 9 over to stay the night. 10 Halfway across the country, in Birmingham, 11 Alabama, Charlie Powell and his neighbors have been 12 plagued by a long history of excessive pollution 13 events from the Walter Coke facility, a plant that has 14 been spewing toxic pollution into the neighboring 15 community for over 100 years. 16 For more than 40 years, Charlie and his wife 17 lived close to Walter Coke. During this time, Charlie 18 saw firsthand the damaging effects of air pollution on 19 his family and neighbors and as a result was compelled 20 to organize with a local community group called PANIC, 21 People Against Neighborhood Industrial Contamination, 22 where he is now the president of that group. 23 PANIC aims to raise public awareness about 24 the health impacts of air pollution from the Walter 2567

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- 4888 Coke facility on the neighboring communities, and 1 unfortunately there is no shortage of examples. While 2 living in the area, Charlie developed sleep apnea and 3 respiratory problems that led to a need for a 4 respirator by his bed when he slept. His wife has 5 battled cancer, and his aunt, Eunice Webb, also in the 6 neighborhood, has developed asthma since moving to the 7 area about 20 years ago. 8 Of Eunice's family that lives in the area, 9 one grandchild that lives with her has developed 10 asthma, one sister has battled cancer, another sister 11 and her mother have suffered heart attacks, and sadly 12 Eunice lost her husband to cancer. Euni ce tells us 13 that she knows of others in the neighborhood also 14 suffering from ailments like cancer. She says that in 15 the summer months the air is so bad that she cannot 16 even go outside because the pollution exacerbates her 17 asthma and it can be hard for her to breathe. 18 Eunice told us that she would like to follow 19 the lead of many of her neighbors and move away when 20 she is able to do so. Another neighbor to the Walter 21 Coke facility is Bobby Hogan, who has lived in the 22 area for more than 60 years. Bobby constantly suffers 23 from respiratory ailments and has had varying 24 diagnoses from his doctor, ranging from bronchitis to 2568

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- 4888 asthma to a chronic cough. Bobby's parents also live 1 nearby and were lost to lung cancer despite neither 2 being smokers. 3 Bobby tells us that he knows of too many in 4 his community that are sick and dying. A property 5 owner with four additional properties near his home, 6 Bobby has been unable to rent these out because, in 7 his words, no one wants to move into his community. 8 He said the air pol lution can be so bad that he 9 literally has to spray the soot off his back porch 10 sometimes as much as twice a week. He worries about 11 going outside to perform everyday tasks like mowing 12 his lawn for fear of exacerbating his asthma. 13 Bobby also hopes to move one day further 14 away from this facility but right now simply cannot 15 afford to do so. 16 These stories are just a few examples of the 17 hardships that so many who live beside industrial 18 facilities are experiencing. We plan to submit 19 additional written comments from some of these people 20 and others from around the country by the comment 21 deadline. 22 In closing, I would like to thank you for 23 the opportunity to share these stories and submit 24 documents in support of this rule. We know, because 2569

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- 4888 doctors, scientists , and nurses tell us that many 1 common air pollutants like smog and soot are a 2 pervasive public health problem that 3 disproportionately affects the most vulnerable members 4 of society: young children, the elderly, those with 5 pre -existing medical issues, and lower income 6 communities. 7 Air pollution can exacerbate asthma and 8 cause respiratory ailments, increase the risk of heart 9 attacks and harm to in utero babies, and even lead to 10 cancer and premature death. Fortunately, reductions 11 in air pollution can resul t in immediate and 12 measurable public health benefits, and EPA has the 13 power and authority to act. 14 Polluters may claim that malfunction events 15 are unavoidable, yet companies who care about how 16 their plants are impacting their neighbors have shown 17 that industry can do better. Many upset emissions are 18 in fact avoidable with better management practices and 19 improved technologies. 20 We commend the EPA for acting because this 21 rule will help curb harmful pollution from planned 22 startup and shutdown events by clos ing state loopholes 23 on affirmative defenses to enforcement actions. While 24 we would still urge EPA to go further with the rule, 2570

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- 4888 as we requested in our petition, this action will go a 1 long way toward addressing this longstanding problem 2 and will make a real difference for families living 3 near these facilities, like I shared with you today. 4 Thank you. 5 MR. DOUGHERTY: Thank you very much. 6 Alex Bond. 7 MR. BOND: Good afternoon. I'm Alex Bond. 8 I'm the Director of Air Quality at the National Mining 9 Associ ation. NMA represents the producers of most of 10 America's coal, metals, industrial, and agricultural 11 minerals, as well as all of the companies that happen 12 to support those activities. 13 EPA's proposed SIP call revising the state 14 standards during SSM

-- thank you for letting me 15 comment on the SSM SIP call. While NMA is still 16 reviewing the rule to try to correctly gauge its 17 potential impacts, my comments today highlight not 18 only impacts on mining operations from EPA's proposal 19 but also the need for EPA to extend the comment period 20 in this instance to ensure robust public comment and 21 truly understand the national impacts of the proposed 22 rule. 23 Further, EPA should realize that its 24 proposal seems to ignore the significant difficulties 2571

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- 4888 in running pollution equipment during SSM periods, 1 unnecessarily limits or eliminates using an 2 affirmative defense, and should thus grant great 3 deference to states upon submittal of SIP provisions 4 should EPA move forward. 5 NMA would further like to note that EPA's 6 proposed rule marks a significant re

- interpretation of 7 longstanding policy, and it is our belief that such a 8 sudden change of the status quo will have significant 9 operational impacts on a wide variety of sources both 10 within and without the mining industry. 11 I have provided a set of draft testimony for 12 you or paper testimony. I'd like to sort of deviate 13 from that in these comments and focus just on five 14 main points. First, we would really appreciate more 15 time to comment on the proposed rule. We think the 16 30

-day and with this

-- I guess it's around a 42

-day 17 comment window

-- is a little bit short. We're trying 18 to grasp exactly what the impacts are going to be 19 across our operations. 20 We have operations in the East Coast, which 21 mainly mine coal and some uranium. There is also a 22 significant Western Coast, West Coast, and mountain 23 area portion of NMA's membership, and we're trying to 24 get our hands around not only the coal utilization 2572

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- 4888 aspect of the rule but also how it will impact mining 1 operations across the spectrum, so mo re time to 2 comment so we can get feedback from our members to see 3 exactly how the proposal will impact operations would 4 be greatly appreciated. And we think it's necessary 5 for such a
-- for a SIP call for 36 states, having 6 such a short comment window is a little brief, and we 7 would appreciate if EPA would act on our letter asking 8 for a 60

-day comment window extension or at least a 9 60

-day comment period in total. So we would 10 appreciate that. 11 Second, we also believe that this SIP call 12 comes at a time that it will have a

-- it's a huge 13 effort by the Agency and also by the states, and it 14 comes at a time that there will be large impacts on 15 sources that are trying to comply with other rules. 16 And on top of that, it comes at a time of budgetary 17 uncertainty where having states go through and commit 18 to a long form rulemaking, which might end up 19 revising, and we're not sure yet

-- which might end up 20 revising so many standards and emissions limits for so 21 many sources is a giant undertaking, and we'd ask the 22 Agency to at least sort of step back if possible and 23 reevaluate exactly what those impacts will be on a 24 large variety of sources both within and without the 2573

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- 4888 mining industry. 1 Third, I think I mentioned this already, but 2 running pollution controls during startup, shutdown, 3 and malfunction periods is very difficult. I mean, 4 first of all, a malfunction is by definition not 5 expected, and it's very difficult to run pollution 6 controls. That's why it's called a malfunction. But 7 during startup and shutdown, if you, for instance, are 8 running a baghouse on an EGU and you

-- during startup 9 periods, you'll shred the baghouse so it won't really 10 be useful for the rest of the time, thus defeating the 11 purpose of having a pollution control device on an 12 EGU. 13 That's just one example. We'd like to have 14 more time to be able to evaluate what the other real

15 world implications of having emission limits during 16 SSM periods might be. 17 Further, we support having an affirmative 18 defense in the rule. We know that EPA has asked for 19

-- is proposing only a limited affirmative defense for 20 periods of malfunction. However, we think that might 21 not be appropriate for all 36 states. Should those 22 states want to keep them, especially if they are in 23 attainment of the standards or in attainment areas , 24 having or eliminating an affirmative defense seems to 2574

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- 4888 be somewhat duplicative in the sense that if a SSM 1 event or an upset emission event happens to occur but 2 does not cause nonattainment, we don't really see the 3 point of limiting an affirmative defense in that 4 regard. And further, if it does cause nonattainment, 5 a state is already obligated to submit a SIP revision 6 to correct the problem. 7 And finally, if EPA does go forward, we 8 would urge
-- you know, under the bedrock of how the 9 Clean Air Act has ope rated for so long, seeing as 10 states and EPA are coregulators under the Act, that 11 bedrock of cooperative federalism will be absolutely 12 essential should EPA try to move forward. And we 13 would urge you to provide great deference to states, 14 knowing that EPA does a phenomenal job with a lot of 15 its rules. 16 We would just like to stress that when you 17 come down to it, certain states are better at 18 understanding the sources within those states, and if 19 they feel that things are appropriate in their SIP 20 provisions, we' d ask you to provide great deference to 21 those states. 22 So we will be submitting extensive comments, 23 I'm sure, and we look forward to working with the 24 Agency on this one. Thank you. 2575

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- 4888 MR. DOUGHERTY: Thank you very much. Mr. 1 Bond was our last registered speaker, so we'll be 2 taking a 20

-minute break. 3 (Whereupon, at 2:41 p.m., the hearing in the 4 above
- entitled matter was concluded.) 5 // 6 // 7 // 8 // 9 // 10 // 11 // 12 // 13 // 14 // 15 // 16 // 17 // 18 // 19 // 20 // 21 // 22 // 23 // 24 // 2576

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- 4888 CERTIFICATE

DOCKET NO.: EPA
-HQ
-OAR
- 2012

- 0322 CASE TITLE: Hearing to take comment on EPA's

proposed rulemaking entitled, "State Implementation Plans: Response to Petition for Rulemaking; Findings of Substantial Inadequacy; and SIP Calls to Amend Provisions Applying to Excess Emissions During Periods of Startup, Shutdown, and Malfunction." HEARING DATE: March 12, 2013 LOCATION: Washington, D.C.

I certify that the foregoing is a true and correct transcript made to the best of our ability from a copy of the official electronic digital recording provided by the United States Environmental Protection Agency in the above

- entitled matter.

Date: March 12, 2013
Gabriel Gheorghiu Heritage Reporting Corporation Suite 600 1220 L Street, N.W. Washington, D.C. 20005

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