### Notes from Site Visit at CPS Energy’s Calaveras Power Station on October 29, 2008

EPA conducted a site visit at CPS Energy’s Calave ras Power Station located in San Antonio, TX on Wednesday, October 29, 2008 to learn about the ope rations at the plant, specifically the FGD wastewater handling system. Table 1, located at the end of this memorandum, identifies the site visit participants. Plant pro cess flow diagrams are included as an attachment to this

memorandum.

This memorandum describes the information collected during the site visit and the pre-site visit phone call, which was held on October 7, 2008.

Background on Steam Electric Detaile d Study and Introductory Remarks

EPA provided background on the steam electric deta iled study, highlighting the current focus on wastewaters from coal-fired facilities, specifica lly ash handling, FGD wastew aters, and coal pile runoff. EPA stated that the purpos e of the study is to determine whether revisions to the current effluent guidelines for the industry are warranted.

EPA stated that the purpose of the visit is to learn more about the plan t’s operations, specifically the operation of the FGD scrubber systems and the FGD wastewater handling systems.

Company Overview

 CPS Energy is municipally owned, but also has a Board of Directors. Fourteen percent of revenues from the company go back to the city.

 CPS Energy operates both the JK Spruce and Deely power plants, which are located adjacent to each other on Calavaras Lake. The entire site, including both plants, covers 6,600 acres, of which the lake occupies 3,600 acres.

 Both plants operate under one NPDES pe rmit and have one common intake. Each plant operates its own water treatment plant.

 The Calaveras Power Station consists of three plants, the Sommers Plant (2 gasfired units), the Deely Plant (2 coal-fired units) and the Spruce Plant (1 existing and one under construction coal-fired units).

 A study conducted on Calavaras Lake analyz ed mercury and other metals in the water column, sediment, and fish tissue, as well as in the intake water (San Antonio River). There was no analysis sp ecifically of the plant effluent. Lowlevel analytical methods were used for the analyses.

 Recently, CPS Energy replaced their ESPs on the Deely units with baghouses due to issues with opacity. After the change to baghouses, the opacity decreased from

10% to 0.4%. Personnel stat ed that the ESP at Deely was old and difficult to keep within their opacity limits, a nd the baghouse reduces labor.Page 2

Plant Overview – JK Spruce

 Spruce has one coal-fired gene rating unit, and is currently installing a second unit. Unit 1 has a capacity of 550 MW and was built in 1992. Unit 2, with a capacity of 750 MW, is under construction and is e xpected to be online in 2010. The table below contains some general information for each generating unit.

Unit Installation

Date Net Capacity

(MW) Particulate

Control NOx Control SO 2 Control 1 1992 550 Baghouses No SCR Wet FGD in original design (1992)

2 2010 (expected) 750 Baghouses SCR will be

installed with

unit Wet FGD in original design (2010)

 Spruce burns Powder River Basin coal. The sulfur content of the coal typically ranges from 0.3 to 0.4% sulfur. The chlorine content of the coal is 0.01% chlorine. Spruce obtains about 95% of their coal from one supplier.

 Coal is received by rail, transferred to the coal pile, and stored in day silos. The on-site coal pile covers approximately 40 acres.

 Runoff from the coal pile is captured in a runoff pond, which is pumped through a clarifier where polymer is added prior to discharge to the Calavaras Lake intake canal. The runoff pond is tested for TSS, oil and grease, and pH. At the request of EPA, site personnel measured the pH of the runoff pond and found it was 8.3

S.U.

 Spruce operates a dry fly ash handling system and has done so for over 10 years. The dry fly ash is stored in a silo and sold for use off site in cement manufacturing. Fly ash is transferre d off site 3 to 4 times per week.

 Spruce operates a dry bottom ash handling system for Unit 1 (Unit 2 is planned to use a dry system as well). Spruce personnel stated that the bottom ash is collected in a water bath collection trough at the bottom of the boiler and a drag chain moves along the trough pulling the bottom ash out of the boiler. Bottom ash is dropped in a pile in an outdoor bunker. Wa ter draining from the pile is collected in a sump and pumped to the SRH pond. The bottom ash is trucked by the 3 rd
party distributor.

 Spruce personnel stated that Unit 1 does not have a SCR system, but Unit 2 is planned to be installed with a SCR system. Spruce expects to operate the systems year round. At this point, Spruce does not expect any change in their ability to reuse water, but is investigating if th ere is anything they should anticipate.

 Spruce operates an on-site landfill and has historically landfilled solids from the operation. For the past 15 years, only economizer ash and some solids from the Sludge/Recycle/Holding (SRH) pond have been landfilled. The landfill isPage 3

currently used to temporarily store small quantities of ash prior to being recycled

off site. The landfill is lined with no l eachate collection. Landfill runoff goes to a separate landfill runoff pond which discharges to Calavaras Lake through internal outfall 013, combining into final outfall 007 to the lake. Spruce personnel indicated that they test the landfill runo ff for TSS, oil and grease, and selenium every six months.

FGD System and Wastewater Handling (JK Spruce)

 Spruce operates a limestone, natural oxi dation FGD scrubber system on Unit 1.

Unit 1 has three individual absorber vessels , two that are in operation at any one time and one spare. Each of the absorber vessels at Spruce has three spray levels, each operated by a separate recirculation pump. A process flow diagram for the FGD system is included as an attachment to this memorandum.

 Personnel noted that calcium sulfite may be produced with the natural oxidation system if the operation is not workin g correctly, and this has happened on occasion (typically after an outage).

 Plant personnel stated that they are planning to c onvert Unit 1 to a limestone, forced oxidation FGD scrubber system at the next outage (expected Spring 2009) to improve SO 2 removal, which is currently at about 84% removal, to 95% removal. Personnel do not expect any difference in the gypsum byproduct.

 Spruce is installing a single tower li mestone, forced oxidation FGD scrubber system on Unit 2. A one tower design is the current industry practice, and it is better from an operability and reliability standpoint.

 Makeup water for the scrubber comes from Calaveras Lake. Spruce personnel stated there are no particular issues or treatment of the lake water needed prior to

reuse.

 Gypsum is produced from Unit 1, and goes through a 3 rd party distributor for sale, primarily for use in cement manufacturing. There is no limit on chlorides when used in cement. A small amount of gypsum was previously sold for wallboard manufacturing, although not any longer. The chlorides limit for use as wallboard is <100 ppm. The gypsum product is not currently utilized for wall board. Spruce does not landfill any of the gypsum.

 Spruce does not wash the gypsum to remove chlorides. The plant is equipped with sprays on the vacuum drum filter, but they have not used them. They would only be used when marketing the gypsum as wallboard. The wash water flow would be 30 gpm, and would be transfe rred to the thickener and then to the

reclaim tank.

 Spruce does not add any additives to the scr ubber to improve the efficiency of the

SO 2 removal in the scrubber.Page 4

 Spruce personnel estimated that the solid s concentration in the scrubbers is approximately 14-15% (by weight). Absorb er pH is maintained near 5.5 S.U.

 Spruce personnel stated that the chlorides concentra tion in the scrubbers is between 8,000 and 10,000 ppm. The scr ubber manufacturer, ABB, allows chlorides to range from 15,000 ppm to 20,000 ppm; however, Spruce has found

that lower chlorides results in better gypsum production. Scrubber wastewater is purged when chlorides reach 10,000 ppm.

 Spruce personnel stated that the blowdow n from the scrubbers is typically

continuous. The blowdown is transferred to the thickener feed tanks and then to the thickeners for solids dewatering.

 Spruce personnel stated that the overflow from the thickeners is transferred to the reclaim tank. From the reclaim tank, the F GD wastewater can be transferred back to the scrubber, to the ball mills, or to the SRH pond. Personnel indicated that wastewater is discharged to the SRH pond about every three weeks for 6 to 8 hours. The SRH pond is made up of a north and south pond, which are used alternately.

 Spruce personnel stated that the underflow from the thic keners (approximately 35 percent solids) is transferre d to the filter feed hold tank. The tank feeds the rotary vacuum filters, which dewaters th e gypsum. The gypsum is conveyed approximately one mile to the stackout lo cation where it is loaded onto trucks.

The filtrate from the vacuum drum filters is transferred to the thickeners about 95- 99 percent of the time; if necessary, it will be sent to the SRH pond.

 From the SRH pond, the water is treate d through a clarifie r at 120 gpm where polymer is added. Effluent from the clarif ier is discharged to the Calaveras Lake intake canal. Currently, disc harge is periodic. Spruce is installing a new set of clarifiers for Unit 2 that will each op erate at 400 gpm and can be operated in series or in parallel. Spruce personne l expect daily discharge once Unit 2 is operating.

 Spruce personnel stated that they monitor Se, Cu, and Fe in their clarifier effluent. Selenium is typically below 0.1 ppm (the plant permit limit is 0.2 ppm). Cu and Fe are only monitored when meta l cleaning operations are occurring.

Deely Plant

 The Deely plant has two coal -fired generating units. Neither unit is currently equipped with FGD scrubbers; but scr ubbers are planned and budgeted for both units. Plant personnel are considering inst allation of limestone forced oxidation systems, but are also evaluating the use of “dry” scrubbers. The capital cost for a wet scrubber is more than a dry scrubber, but CPS Energy personnel stated that the lifecycle costs for wet and dry FGD systems are comparable.

 Deely Unit 1 will be equipped with a SCR in 2011. The SCRs are planned to be operated year round.Page 5

 Deely operates a dry fly ash handling system. The dry fly ash is stored in a silo and sold for use off site in cement manufacturing.

 Deely did not perform a wet to dry fly ash handling conversion because the plant has never wet sluiced their fly ash. In th e first few years of operation, the fly ash was ponded until a market for the ash could be developed. Fly ash has always been transported from the ESP hoppers to the silos with air.

 Deely operates a wet bottom ash handling sy stem for Units 1 and 2. The plant has two bottom ash ponds. As one pond fills with ash, the sluice water is discharged to the second pond while ash is removed from the first pond. Deely typically switches ponds about every 6 months. Ash sluice water is recycled back to the plant; Deely also has the option to disc harge the water to Calaveras Lake if needed. The bottom ash pond discharges to the lake periodically (approximately weekly) due to insufficient surge volume in the system, or when draining a pond to remove ash. Constructing additional surge volume capacity would be needed to eliminate all discharge from the bottom ash pond.

 Plant personnel stated that they have considered retrofitting Deely to use dry bottom ash handling; however, they do not anticipate switching to submerged scaper conveyor ash handli ng due to the expense and in stallation constraints, and no serious study has been performed.

 CPS Energy personnel stated th at they can’t reuse the sluice water as scrubber makeup water; they would need to treat the sluice water to remove carbon so they would not contaminate the gypsum produced by the system.Page 6Table 1. Site Visit AttendeesNameOrganization (Representing)TelephoneE-mailMario Alvarez CPS Energy (210)353-5818 maalvarez@cpsenergy.comSamuel HelmleCPS Energy(210) 353-5580 sfhelmle@cpsenergy.comJeff KruseCPS Energy(210) 353-3839 jjkruse@cpsenergy.comErik MeyersCPS Energy(210) 353-3955 ekmyers@cpsenergy.comKim StokerCPS Energy(210) 353-2929 krstoker@cpsenergy.comGregg TiekenCPS Energy(210) 353-2158 grtieken@cpsenergy.comRudy MartinezCPS Energy(210) 353-3979 rumartinez@cps energy.comRon Jordan EPA/Office of Water(202) 566-1003 jordan.ronald@epa.govDeb Bartram ERG (Contractor to EPA)(703) 633-1669 deborah.bartram@erg.comAttachment

CPS ENERGY PROCESS FLOW DIAGRAMS