US1DOCS 7993688v1 July 15 , 2011

Hand Delivery and Email

Lisa Jackson, Administrator US EPA Headquarters Ariel Rios Building (Rm. 3000) 1200 Pennsylvania Ave., NW Washington, DC 20004

Attention: Reconsideration Petition in Docket ID No. EPA

- HQ

- OAR

- 2002

- 0058

-- National Emission Standards for Hazardous Air Pollutants for Major Sources: Industrial, Commercial, and Institutional Boilers and Process Heaters, Notice of Reconsideration of Final Rules, 76 FR 15266 (March 21, 2011); Notice of Delay, 76 FR 28662 (May 18, 2 011).

Dear Administrator Jackson:

America’s Natural Gas Alliance (ANGA) appreciates the opportunity to submit these comments to the U.S. Environmental Protection Agency (EPA) regarding the Agency’s reconsideration of the final Boiler MACT Rule

-- Natio nal Emission Standards for Hazardous Air Pollutants for Major Sources: Industrial, Commercial, and Institutional Boilers and Process Heaters , 76 FR 15608 (March 21, 2011), and the EPA’s request for additional data and information in the Notice of Delay of Final Rule, 76 FR 28662 (May 18, 2011). In addition, these comments apply to reconsideration of, and request for additional data and information regarding, the National Emission Standards for Hazardous Air Pollutants for Area Sources: Industrial, Commerci al and Institutional Boilers and Process Heaters. Our comments refer to these two rules together as the “ICI Boiler MACT Rules.”

ANGA is an educational and advocacy organization formed by North America’s leading independent natural gas exploration and pro duction companies. Together, ANGA members produce about 40 percent of the total U.S. natural gas supply. ANGA is dedicated to increasing appreciation for the environmental, economic and national security benefits of clean, abundant, affordable and dependab le North American natural gas. ANGA’s member companies produce the clean and efficient natural gas that is currently being burned in the over 11,000 natural gas

fired boilers/process heaters that are covered by the ICI Boiler MACT Rules.

ANGA supports EPA’s decision to subject natural gas

- fired boilers to a work practice standard that requires an annual tune

- up in lieu of emission limits, 1 and believes that the administrative record supports the technical, economic and legal justifications set forth by EPA in the ICI Boiler MACT Rules. EPA accurately recognizes that natural gas is the cleanest fuel available for boilers, and that emissions of mercury and other HAPs from properly maintained natural gas

- fired boilers are so low that they are below the lev el EPA considers to be a reliable
measurement. 2

1 76 Fed. Reg. , 15608, 15612 (Mar. 21, 2011).

2 Id. , at 15638.US1DOCS 7993688v1 In comments dated August 23, 2010, regarding the pro posed ICI Boiler MACT Rules, we

, along with the American Gas Association (AGA), specifically requested that the Agency take into consideration the most re cent and best science, information and data with respect to fundamental issues such as the significantly lower level of HAP emissions from natural gas

- fired boilers and the ability of the industry to provide natural gas to ICI boilers in light of current

n atural gas supply and infrastructure conditions (see pages 9

- 14 of ANGA’s August 23, 2010 comments, which are attached, for a summary and discussion of these issues). We note that AGA has filed comments on the Boiler MACT reconsideration and we hereby end orse those comments, dated July 5, 2011.

Based on our review of the ICI Boiler MACT Rules, and the Response to Comments document, we are very disappointed that EPA failed to consider the dramatic expansion in the supply of domestic natural gas since 2007

. We encourage the Agency, as part of this reconsideration process, to consider and incorporate in its analyses the recent, best available data as well as the potential cost

- effectiveness implications this abundant supply would have on the choice to use nat ural gas as a fuel for boilers and process heaters

. The Agency response to
comments i

ANGA als o requests that EPA revise its unsupported conclusion that fuel switching to natural gas would lead to an increase in HAP emissions. For a further discussion of this issue, see pages 5

- 7 of ANGA’s August 23, 2011 comments. EPA correctly concludes that na tural gas is the “cleanest fuel available for boilers” in the rulemaking. We encourage the agency to make its control decisions based on the scientifically supported fact that natural gas is a clean burning fuel. fails to provide any explanation as to how the Agency considered or incorporated the best available data in its final proposal. The Agency’s entirely conclusory statemen t, and the absence of such an explanation or incorporation of the data in revised analyses

, raises concerns as to whether the standard set by the Agency in the final rule is based on best available data or supported by the administrative record.

ANGA believes that this rule, like other rules promulgated by the Agency, should reflect the use of the best data and science that is available, and that the ongoing reconsideration presents an opportunity for EPA to do so. As part of its reconsideration, we request that the Agency look more cl osely at its analysis of both the capital costs and operating costs of fuel switching. For example, in its 2010 Cost Memorandum, the Agency claimed that its regulatory requirements for multiple post

- combustion controls on coal

- fired boilers would achieve roughly the same emissions reductions as switching to gas (2010 Cost Memo, Appendix A

- 7); however, it never compared the $4.5 billion capital cost for those controls 3

We also repeat our request that the Agency look more closely at that $1.171 billion capital cost for fuel switching in the 2010 Cost Memo. We continue to believe that using cost data from one 1986 feasibility study that is actually based on converting oil, not coal fired boilers, is inappropriate for purposes of estimating costs in 2010

- 2011. Furthermore, our analysis

s uggests that the boiler conversions that were the subject of the 1986 feasibility study all involved conversions from oil

- to

- gas, not coal

- to

- gas, and that the Agency may have inadvertently included a separate cost estimate

-- not actual costs

-- for one of those three boilers as the fourth “conversion”. to its capital cost figure of $1.171 billion for the capital cost of fuel

- switching to na tural gas.

3 See, Regulatory Impact Analysis, p. 3

- 2.US1DOCS 7993688v1 Finally, with respect to operating costs, ANGA requests that as part of i ts reconsideration process, EPA revisit the price of natural gas that it used in its analysis. In its cost analysis for the ICI Boiler MACT Rules the Agency used a gas price of $11.66 per MMBtu; however, in the cost analysis in the Technical Support Docum ent that the Agency published for its proposed utility EGU MACT

-- which was signed two weeks after the ICI Boiler MACT Rules were finalized

-- it used $5.74 per MMBtu. ANGA suggests that the Agency look to more recent price data 4

ANGA respectfully suggests that the Agency would be well served to take into consideration the most recent and best science, information and data as it reconsiders the I CI Boiler MACT Rules, and requests that it look specifically at the issues identified in these comments as part of its broader reconsideration of the entire rule. , including its own conte mporaneous data, to support a more robust cost analysis for the ICI Boiler MACT Rules.

If you have any questions, please contact Peter Robertson at probertson@anga.us or (202) 789

- 2642.

Sincerely,

Regina Hopper President and CEO

CC:

Gina McCarthy, Assistant Administrator Office of Air and Radiation US EPA Headquarters Ariel Rios Building (6101A) 1200 Pennsylvania Ave., NW Washing ton, DC 20460

Brian Shrager Energy Strategies Group Sector Policies and Programs Division (D243

– 01) Office of Air Quality Planning and Standards, U.S. Environmental Protection Agency Research Triangle Park, NC 27711

4 e.g. Henry Hub and NYMEX data showing prices will stay low and stable http://www.eia.gov/dnav/ng/ng_pri_fut_s1_d.htmUS1DOCS 7993688v1 Jim Eddinger Energy Strategies Grou p Sector Policies and Programs Division (D243

– 01) Office of Air Quality Planning and Standards U.S. Environmental Protection Agency Research Triangle Park, NC 27711

i “ EPA has reviewed the complex details ci ted by the commenter, such as the country’s pipeline and storage network capacities. However, the EPA decision that fuel switching is inappropriate remains unchanged” i