Mr. Mike Wilson, Director Air Permits (MC163) 

Texas Commission on Environmental Quality 

P.O. Box 13087 

Austin, Texas 78711-3087 

May 2, 2013 

RE: Request for One-Year Extension of MACT Compliance Date 

Southwestern Electric Power Company 

Welsh Power Plant- CN600126767, RN100213370 

Dear Mr. Wilson: 

On February 16, 2012, U.S. EPA published notice of final regulations under Section 

112(d) of the Clean Air Act for electric generating units (EGUs), Welsh Power Plant Units 1, 2 

and 3. The regulations (commonly referred to as the Mercury and Air Taxies Standards or 

"MATS") adopt stringent limits for particulate matter, hydrochloric acid, and mercury on a 30-

day rolling average basis for each unit. The coal-fired units at Welsh Power Plant are not 

currently equipped with the necessary controls to achieve and maintain compliance with the 

standards. 

For Units 1 and 3, Southwestern Electric Power Company (SWEPCO) plans to install 

control equipment that will achieve compliance with the MATS standards. The schedule for 

installation of this equipment on both units extends beyond the April 16, 2015 compliance 

deadline. For Unit 2, SWEPCO is planning to retire the unit, but certain transmission upgrades 

must be installed in order to allow the retirement of this unit without adversely impacting the 

reliability of the electricity grid. The schedule to complete these transmission projects also is 

expected to extend beyond April 16, 2015. Accordingly, SWEPCO respectfully requests a one 

year extension of the compliance deadline for these units, including all related performance 

testing, recordkeeping and reporting requirements, and all applicable compliance dates set forth 

in 40 CFR Part 63, Subparts UUUUU and the applicable general requirements in Subpart A. 
Sout

western Electric Power Company 

Welsh Power Plant- CN600126767, RN100213370 

SWEPCO will retrofit Units 1 and 3 with a combination of pollution controls, including 

activated carbon injection and a pulse-jet fabric filter baghouse. This compliance option requires 

detailed study, design, engineering, and procurement activities, and receipt of regulatory 

approvals prior to commencement of construction. Some preliminary design and engineering 

work has been undertaken for the controls, however, more detailed design work is necessary to 

support procurement and other construction activities. Commencement of certain construction 

activities will depend on receipt of appropriate environmental and other permits. It is estimated 

that even with an expedited construction schedule, 33 months or more will be required for 

construction and commissioning. The attached schedule reflects our preliminary overall 

schedule to design, permit, procure, construct and commission the environmental controls, which 

is expected to extend into early 2016. 

SWEPCO submitted a notification to the Southwest Power Pool ("SPP") of the proposed 

retirement of Welsh Unit 2 by no later than December 31,2014 (see attached letter), unless SPP 

identifies and approves transmission mitigation measures that must be completed prior to the 

retirement of Welsh Unit 2 that have in-service dates beyond December 31, 2014. SPP 

deveioped an integrated assessment of its entire transmission system that mcorporates the 

proposed retirement of Welsh Unit 2 and other proposed changes across the SPP Transmission 

System. SPP's draft assessment indicates that construction of new transmission facilities will be 

required to maintain compliance with North American Electricity Reliability Commission 

("NERC") reliability standards as a result of these proposed changes. The SPP Board of 

Directors considered the draft assessment at its meeting in the first quarter of2013, and issued a 

final report, including pro 1osed dates for completion of construction of the approved 

transmission projects. AEP has received a notice to proceed with construction of the 

transmission improvements (identified as Project No. 30495 in SPP's long-term plan) and SPP 

has scheduled the project to be completed by the end of2015, subject to AEP's ability to provide 

more detailed cost estimates, obtain required regulatory approvals and rights ofway, and subject 

to any conditions which may develop during implementation that could impact the schedule. 

AEP must notify SPP of any such conditions as soon as it is aware of any potential adverse 

impact on the project schedule. AEP is proceeding with design development and other project 

activities, and requests an extension of the MATS compliance deadline until completion of the 

required transmission upgrades or April 16, 2016, whichever is sooner. The 2013 SPP 

Transmission Expansion Plan Report can be found on the SPP website at the following link 
Southwestern Electric Power Company 

Welsh Power Plant- CN600126767, RN100213370 

http://www.spp.org/publications/2013STEPReport.pdf. A reference to Project 30495 can be 

found on page 8 of 14. 

The Texas Commission on Environmental Quality is authorized to grant the requested 

extension under Section 112(i)(3)(B) of the Clean Air Act, 42 U.S.C. § 4212(i)(3)(B), and the 

general provisions of Part 63. 40 CFR § 63.6(i)(3). For the units included in this request the 

extension will provide the necessary time for pollution control installations being constructed in 

order to comply with MATS emission standards, and construction of transmission mitigation 

necessary to protect the reliability of the electricity grid. The requested extensions are consistent 

with U.S. EPA's discussion of the range of circumstances that might trigger a need for additional 

time to comply in the preamble to the final MATS rule in the Federal Register. 77 Fed. Reg. 

9410-12 (February 16, 2012). SWEPCO recommends that TCEQ establish a semi-annual 

reporting schedule that commences with the first semi-annual period after receipt of the 

preconstruction permits for the planned controls and/or transmission upgrades, and is consistent 

with the other semi-annual reports required under the Welsh Plant's Title V permit. Each report 

can include an update on the status of construction, major equipment orders placed during the 

semi-annual period covered by the report, and the date of completion of construction, as 

appropriate. 

SWEPCO cannot predict the impact of other actions on the time needed to comply. For 

instance, delays in the installation of controls or transmission construction, permitting delays, 

work stoppages, lack of raw materials or skilled labor could occur that will affect the availability 

of the technologies required for compliance with the rule. In such circumstances, a further 

extension may be required. By requesting this extension based on known commitments and 

obligations, SWEPCO does not waive its right to request an additional extension for this unit in 

accordance with applicable law. 
Sout

western Electric Power Company 

Welsh Power Plant- CN600126767, RN100213370 

SWEPCO appreciates your prompt consideration of this request, and company 

representatives are available to meet with you to discuss this request and the enclosed supporting 

information, if necessary. Please contact Bruce Moore of my staff at (214) 777-1116 to arrange 

a meeting date. 

Very truly yours, 

John M. McManus 

Vice President Environmental Services 

Attachment 

Copy w/ Attachment: 

Director, Air, Pesticides and Toxics, USEPA Region 6, w/Att. 

Michelle Baetz, TCEQ, Tyler TX., w/ Att. 

Bruce Moete, AEP, wl Att. 
Chief Operating Officer 

Southwest Power Pool 

415 North McKinley Street, Suite 140 

Little Rock, AR 72205 

RE: Retirement of Welsh Unit 2, Pittsburg, TX 

Dear Mr. Monroe: 

As a Member and Transmission Customer of the Southwest Power Pool, 

Southwestern Electric Power Company (SWEPCO) wants to confirm to SPP its plans to 

retire Welsh Unit 2, a 528-MW coal-fired unit located near Pittsburg, Texas. The 

retirement is required by the terms of a Consent Order issued on December 22, 20 II, by 

the United States District Court for the Western District of Arkansas, which resolved all 

pending legal challenges to the completion of construction and commencement of 

commercial operation of SWEPCO's John W. Turk, Jr. Power Plant, located near Fulton, 

in Hempstead County, Arkansas. The Turk Plant is presently under construction and 

expected to commence commercial operation by the end of this year. 

Under the terms of the Consent Order, after the Turk Plant commences 

commercial operation, generation from Welsh Unit 2 will be restricted to a sixty percent 

annual capacity factor during any rolling 12-month period. Thereafter, Welsh Unit 2 

must be retired "by December 31, 2014, unless SPP has identified and approved transmission 

mitigation measures that must be completed prior to the retirement of Welsh Unit 2 that have inservice dates beyond December 31, 2014, in which case SWEPCO will permanently retire Welsh 

Unit 2 as soon as all required approvals have been issued and all necessary transmission 

mitigation measures have been completed, but no later than December 31, 2016." 

Other factors could accelerate the planned retirement date for this unit. The 

Environmental Protection Agency (EPA) recently finalized the National Emission 

Standards for Hazardous Air Pollutants from Coal- and Oil-Fired Electric Utility Steam 

Generating Units, 77 Fed. Reg. 9304 (Feb. 16, 2012) (hereinafter the "Utility MATS 

Rule"), which imposes very stringent requirements to reduce emissions of mercury, acid 

gases, and trace metals present as particulate matter within three years after the effective 

date of this new regulation, or by April 16, 2015. Welsh Unit 2 does not currently meet 

these standards, and no new controls are planned for this unit due to its imminent 

retirement date. If the retirement of Welsh Unit 2 has not occurred by December 31 , 

2014, due to the need for transmission mitigation measures, its operation could be 

constrained beginning on April 16, 2015 by the Utility MATS Rule. There is a one-year 

extension available from the Texas Commission on Environmental Quality (TCEQ) if 
of the electric grid. Such extensions, if available, could allow Welsh Unit 2 to continue 

to operate up to December 31, 2016. 

SWEPCO is requesting SPP' s assistance to identify and develop the transmission 

solutions that will alleviate any reliability problems that result from the planned 

retirement of Welsh Unit 2. If the preferred solutions cannot be implemented prior to 

April 16, 2015, SWEPCO requests SPP's assistance in explaining the required scope of 

work and schedule to the TCEQ and possibly EPA to secure the necessary extensions to 

operate Welsh Unit 2 beyond the compliance deadline for the Utility MATS Rule. We 

understand that such evaluations are already underway based on SWEPCO's prior 

responses to SPP's survey requests. 

Richard Ross has and will continue to be our primary contact and assist in setting 

up meetings or discussions between the appropriate SPP, SWEPCO and AEP 

representatives on this matter. We appreciate the cooperation and assistance provided by 

SPP in developing and implementing the necessary mitigation measures to assure the 

continued reliable operation of the electricity grid. 

Very truly yours, 

Venita McCellon-Allen 

cc: Mark C. McCullough 

Daniel L. Snider 

Richard Ross 

Janet J. Henry