NMED EXHIBIT 15

PROPOSED ORDER AND STATEMENT OF REASONS

FOR ADOPTION OF SIP REVISIONS
EIB No. 13-02 Statement of Reasons and Order

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STATE OF NEW MEXICO

BEFORE THE ENVIRONMENTAL IMPROVEMENT BOARD

IN THE MATTER OF PROPOSED REVISIONS

TO THE STATE IMPLEMENTATION PLAN

FOR THE SAN JUAN GENERATING STATION

BEST AVAILABLE RETROFIT TECHNOLOGY

DETERMINATION 

No. EIB 13- 02(R)

____________________________________________________________________________

ORDER AND STATEMENT OF REASONS

FOR ADOPTION OF SIP REVISIONS

______________________________________________________________________________

This matter comes before the New Mexico Environmental Improvement Board (“Board”) 

upon a petition filed by the New Mexico Environment Department (“NMED” or “Department”), 

proposing amendments to New Mexico’s State Implementation Plan (“SIP”) for regional haze, in 

order to adopt a determination of the Best Available Retrofit Technology (“BART”) and 

associated emission limits for the San Juan Generating Station (“SJGS”), operated by Public 

Service Company of New Mexico (“PNM”). A public hearing was held in Farmington, New 

Mexico on September 5 [and 6], 2013, with a quorum of the Board present during the hearing. 

The Board heard technical testimony from the Department and other parties and admitted 

exhibits into the record. On September __, 2013, the Board deliberated and voted to adopt the 

proposed amendments for the reasons that follow:

I. STATEMENT OF REASONS

1. The federal Clean Air Act (“CAA”) requires states to submit State Implementation Plans 

(“SIPs”) to address visibility impairment caused by regional haze at certain National 

Parks and Wilderness Areas (“mandatory federal Class I areas”), in accordance with 
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regulations promulgated by the U.S. Environmental Protection Agency (“EPA”). CAA 

§§ 169A & 169B (42 U.S.C. §§ 7491 & 7492 ).

2. The EPA regulations governing SIP submittals under CAA Sections 169A and 169B are 

codified at 40 C.F.R. §§ 51.308 – 51.309 (“Regional Haze Rule Sections 308 and 309”).

3. In December 2003 the Board approved a SIP developed by NMED to comply with the 

Requirements of Regional Haze Rule Section 309 with respect to mandatory federal 

Class I areas located on the Colorado Plateau. The Department has implemented this 

“Section 309 SIP” continuously since that time. 

4. In June 2011 the Board approved certain revisions to the 2003 regional haze SIP and 

adopted additional SIP provisions pursuant to 40 C.F.R. § 51.309(g), which extended the 

scope of the regional haze SIP to all mandatory federal Class I areas within the State.

5. The 2011 SIP contained source-specific BART determinations pursuant to 40 C.F.R. § 

51.308(e) for the SJGS for particulate matter (“PM”) and nitrogen oxides (“NOx”), and 

determined that no other sources in New Mexico were subject to BART requirements. 

The BART provisions of the SIP were contained in Chapter 10 and the documentation of 

the SJGS BART determination was contained in Appendix D of the SIP.

6. In August, 2011, the EPA promulgated a federal implementation plan (“FIP”) containing 

a different NOx BART determination for the SJGS. 76 Fed. Reg. 52,388 (Aug. 22, 

2011). 

7. Petitions filed by New Mexico, PNM, and WildEarth Guardians challenging different 

aspects of the FIP are currently pending in the United States Court of Appeals for the 

Tenth Circuit.
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8. In November, 2012, the EPA approved all elements of New Mexico’s 2011 regional haze 

SIP, except for the NOx BART determination for the SJGS, on which EPA took no 

action. 77 Fed. Reg. 70,693 (Nov. 27, 2012).

9. Pursuant to 20.1.300.A NMAC, any person may petition the Board for amendment of 

regulations within the jurisdiction of the Board.

10. On May 21, 2013 NMED filed a petition with the Board for a public hearing in this 

matter. The petition proposed revised versions Chapter 10 and Appendix D of the 

regional haze SIP. The purpose of the revisions is to make a new BART determination 

for the SJGS based on a scenario referred to as the “State Alternative,” which is 

contained in a tentative agreement between NMED, EPA, and PNM known as the “Term 

Sheet.” The Term Sheet is intended to address pollution control requirements for the 

SJGS with respect to regional haze and interstate transport for visibility. 

11. On June 15, 2013, at a meeting conducted in compliance with the Open Meetings Act and 

other applicable requirements, the Board granted the Department’s request for a hearing 

and scheduled the hearing for September 5 – 6, 2013. The Board appointed member John 

Volkerding as the Hearing Officer.

12. On June 28, 2013, public notice of the hearing was published in the New Mexico 

Register, in the Farmington Daily Times (in English and Spanish), and in the

Albuquerque Journal (in English and Spanish) . The notice stated that the Board may 

make a decision on the proposed SIP revisions at the conclusion of the hearing, or may 

convene at a later date to consider action on the proposal.

13. NMED filed a Notice of Intent to Present Technical Testimony (NOI) on August 16, 

2013, in accordance with the 20.1.1 NMAC.
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14. The following parties also filed NOIs:

15. A hearing was in this matter was held in Farmington, New Mexico on September 5 [& 6], 

2013, at which a reasonable opportunity for all persons to be heard was provided.

16. The Board has the authority to adopt the proposed SIP revisions pursuant to N.M.S.A.

1978, §§ 74-2-5.B & C.

17. Implementation of the State Alternative will abate air pollution.

18. CAA § 169A(g)(2) requires that BART determinations shall take into consideration “[1] 

the costs of compliance, [2] the energy and nonair quality environmental impacts of 

compliance, [3] any existing pollution control technology in use at the source, [4] the 

remaining useful life of the source, and [5] the degree of improvement which may 

reasonably be anticipated to result from the use of such technology.” 

19. In considering the proposed SIP revisions, the Board is required by the Air Quality 

Control Act, NMSA 1978, Section 74-2-5.E. to give weight it deems appropriate to all 

facts and circumstances, including but not limited to (1) character and degree of injury to 

or interference with health, welfare, visibility and property; (2) the public interest, 

including the social and economic value of the sources and subjects of air contaminants; 

and (3) technical practicability and economic reasonableness of reducing or eliminating 

air contaminants from the sources involved and previous experience with equipment and 

methods available to control the air contaminants involved.

20. EPA has promulgated guidelines for States to use in making BART determinations, 

which are codified at 40 C.F.R. Part 51, Appendix Y. Pursuant to CAA § 169A(b)(2), 
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use of the guidelines is mandatory for BART determinations for fossil fuel fired power 

plants with total generating capacity in excess of 750 megawatts.

21. NMED’s determination that the State Alternative constitutes BART for NOx for the 

SJGS complies with the guidelines at 40 CFR Part 51 Appendix Y and properly weighs 

the statutory factors of CAA § 169A(g)(2).

22. The Board concludes that the BART guidelines at Appendix Y provide an appropriate 

methodology to consider to the factors specified by NMSA 1978, Section 74-2-5.E. The 

Department’s application of Appendix Y to the BART determination for the State 

Alternative appropriately weighs the Section 74-2-5.E factors.

23. In addition, in accordance with N.M.S.A, Section 74-2-5.E (2), the Board concludes that 

the public interest will be served by implementation of the State Alternative. 

Specifically, in addition to satisfying the NOx BART requirements of the CAA, 

implementation of the State Alternative will result in significant reductions in sulfur 

dioxide, particulate matter, carbon dioxide, and mercury; significant reductions in coal 

ash generated and water consumed.

24. In accordance with NMSA 1978 Section 74-2-5(C)(1)(a), the proposed SIP revisions and 

regulations are no more stringent than but at least as stringent as required by the federal 

act and federal regulations pertaining to visibility protection in mandatory class I areas.

25. The notice and hearing requirements of NMSA 1978 Section 74-2-6 and 20.1.1 NMAC 

were satisfied in this rulemaking process.

26. The proposed amendments are adopted for any or all of the reasons stated above.
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II. ORDER

By majority vote of a quorum of the Board members, the proposed revisions to New 

Mexico’s regional haze SIP at Chapter 10 and Appendix D, as contained in NMED’s May 21, 

2013 petition and request for hearing, were approved by the Board on September ___, 2013. The

Department shall submit these SIP revisions as expeditiously as possible to the EPA for 

approval. To the extent that any provision within Chapter 10, Section 10.5 (Implementation of 

the State Alternative) is not self-executing, the Department shall take appropriate actions to 

implement that provision using its applicable powers and authorities, including but not limited to 

enforcement authority under N.M.S.A. 1978, 74-2-12 and permitting authority under N.M.S.A. 

1978, § 74-2-7, and implementing regulations.

Dated: 

On Behalf of the Board