UNITED STATES ENVIRONMENTAL PROTECTION AGENCY REGION 5 AIR AND RADIATION DIVISION 77 WEST JACKSON BOULEVARD CHICAGO, IL 60604-3590

REPLY TO THE ATTENTION OF:

Lorraine Hickman Air Quality Division 

### JUN Z 

## 3 2010

Michigan Department ofNatural Resources and Environment P.O. Box 30260 Lansing, Michigan 48909

Dear Ms. Hickman: A-18J

We appreciate Michigan's work in preparing and drafting a regional haze SIP submittal. Enclosed are our comments on this draft submittal. We welcome any discussions of these
comments that would be helpful to you, and we look forward to receipt of a final submittal that addresses these comments.

The Forest Service has also sent you comments, dated June 21,2010. We share their concerns, particularly regarding the determinations that existing controls satisfY the requirement for best available retrofit technology for three of the four sources subject to this requirement. Your response to these comments will be an important factor in our evaluation of your prospective submittal.

Thank you again for your work in addressing regional haze. Please contact John Summerhays at 312-886-6067 or Steve Rosenthal at 312-886-6052 if you have any questions.

Sincerely,

Michael Compher, Acting Chief Attainment Planning and Maintenance Section

EnclosureComments on Draft Michigan Regional Haze Plan

Comments on Best Available Retrofit Technology (BART)
Michigan’s submittal should provide that the shutdown of Empire Mine's furnace is permanent.
St. Mary's Cement (SMC) BART Comments
We disagree with MDEQ's assessment that a selective non-catalytic reduction system is technically infeasible and not cost-effective. There does not appear to be documentation describing why SMC has insurmountable problems operating a SNCR system in winter. Also, four other cement plants are proposing SNCR as BART. These are Ash Grove Cement in Montana, CEMEX in Colorado, Holcim Cement in Montana, and LaFarge North America in Washington. The average cost effectivene ss range of $900-1200 per ton, as reported in the MANE-VU document regarding SNCR, further sugge sts the cost effectiv eness of SNCR. In addition, the 10 percent control e fficiency that SMC assumed for SNCR appears too low. The Lafarge BART analysis, for example, states the "expected control effectiveness of SNCR (on the order of 30 to 40 percent based on publicly avai lable data)."
New Page (NP) - Escanaba BART Comments
There is no basis for rejecting control options for the boilers because "visibility modeling does not indicate it will result in a si gnificant visibility improvement (i .e., at least 0.5 deciviews)." The BART guidelines provide no such ba sis for rejecting control options.
If the interest rate and expected equipment lif e for the low NOx burner (LNB) analysis for Boiler No. 8 is made consistent with other analyses (15 years and 7% versus 10 years and 10%), along with eliminating the costs asso ciated with apparently unnecess ary labor, the average cost effectiveness is $2100 per ton. The SNCR BARTanalysis for Boiler No.9 is extremely inconsistent with the MANE-VU document costs. An explanation should be provided for this extremely large discrepancy. As stated for Boile r No. 8, the expected equipment life of 10 years and interest rate of 10% shoul d probably be 15 years and 7%.
Tilden Mining Company (TMC)
It should be noted that in Apr il, USS Minntac installed a low-NOx main burner firing solid fuels in its furnace and extensive work done by a num ber of companies in Minnesota has shown that burner designs that lower the flame temperature can reduce NOx formation in taconite furnaces. Low-NOx burners are also being designed for a ne w taconite plant, Essar Steel, that will fire natural gas. Also, in a separate permitting action, the Minnesota Pollution Control Agency (MPCA) has determined that LoTOx is technica lly and economically feasible for a different taconite facility.
Regarding sulfur dioxide, the MPCA has determinedthat the addition of a scrubber at the United Taconite plant that burns primarily coal was tech nically and economically feasible. To arrive atthis conclusion the MPCA corrected the cost an alysis submitted by the same consultant who submitted Tilden's BART analysis.
As the only taconite plants in the US are located in Minnesota and Michigan, Michigan should be consistent with what Minneso ta has done, especially the requi rement to install NOx and SO2 CEMs and perform a pilot testing program of pote ntial NOx control strategies starting in July 2011.

Tilden's revised BART scenario, which show s that SO2 alone does not cause visibility impairment to Class 1 areas, is inconsistent w ith EPA policy and is therefore not an adequate basis for concluding that the current Title V permit limits for SO2 emissions of 28,800 lbs per day should be considered BART.

Other Comments
1. Given the regional nature of regional haze, we consider Michigan’s test for significance, based on whether a state contributes 5 percent of the regional haze, to be an overly stringent test that indicates too few significan t contributors. Although EPA does not specify a particular test of significance for states to use, the alternative contemplated by Mich igan, based on whether a state contributes 2 percent of the regional haze, likely provides a better indicator of whether a state has a contribution th at warrants addressing.
2. We would not agree that the Midwest Region al Planning Organization is dormant. In any case, we would note that the Lake Michigan Air Directors Consortium continues to perform work on regional haze and other related air pollu tion issues, currently based primarily on state funding.

3. The discussion of factors to be considered in defining BART lis ts instead the statutory factors for evaluating reasonable progress. The Clean Ai r Act has a set of five factors for BART that differ somewhat from the four factors listed on page 7.
4. Although the regional haze rule provides for CA IR where applicable to satisfy the BART requirement with respect to SO2 and NOx from electric generating units, EPA is reconsidering this guidance. Therefore, we would not necessarily agree that it is “EPA’s position” that CAIR satisfies pertinent BART requirements. Simila rly, Michigan should a void statements as to whether EPA does or doesn’t intend for CAIR to “address reasonable controls for [electric generating units] in . . . regional haze SIPs.”
5. The reasonable progress goals are based on modeling runs that do not reflect BART determinations in Michigan and other states. While future haze levels are difficult to predict, especially due to uncertainties regarding utility control requirements and control levels, EPA willexpect Michigan to establish r easonable progress goals that reflect at leas t an approximation of BART control levels.
6. Michigan must submit the documents that are to provide for federal enforceability of specific limits representing BART. Even if these limits are already federally enforceable, Michigan must submit these documents for inclusion in the docket for EPA’s rulemaking on Michigan’s prospective SIP submittal and for incorporation by reference as part of Michigan’s SIP.
7. The consent decree that Michigan is relying on to require BART leve l controls specifies interim emission limits but also provides for tes ting to determine final emission limits. When final limits are determined, the consent decree wi ll be replaced by a permit that Michigan is expected to issue. Altho ugh the interim limit may suffice for current haze SIP purposes, Michigan needs to describe how it will process the final limits. In particular, Michigan needs to describe how it intends for the ultimate limit to become enforceable by the State and by EPA and how it will become part of the SIP, so as to replace the consent decree before the consent decree expires. If Michigan intends to rely on a Title V permit to provi de for federal enforceability of the replacing limits, Michigan will need to addr ess questions about whether it has authority to define a BART limit in a Title V permit rather than having the Title V permit simply compile a limit established elsewhere. As a general matter, Title V permits do not offer a proper mechanism for setting new limits.