UNITED STATES DISTRICT COURT

FOR THE WESTERN DISTRICT OF TEXAS

AUSTIN DIVISION

UNITED STATES OF AMERICA, )

)

Plaintiffs, )

)

v. )

)

ALCOA INC., )

)

Defendant. ) 

) 

CIVIL ACTION NO. 

NEIGHBORS FOR NEIGHBORS, INC, )

ENVIRONMENTAL DEFENSE, )

PUBLIC CITIZEN, INC. )

)

Plaintiffs, )

)

)

v. )

)

ALCOA INC., )

)

Defendant. ) 

) 

CONSENT DECREE 

CIVIL ACTION NO. 

A-01-CA-881-SS 
TABLE OF CONTENTS

I. JURISDICTION AND VENUE ............................................3

II APPLICABILITY .......................................................4

II DEFINITIONS ..........................................................4

IV POLLUTION CONTROLS AND REDUCTIONS .............................11

A. SELECTION OF POLLUTION REDUCTION APPROACH ..............11

B. INSTALLATION OF POLLUTION CONTROLS 

AT EXISTING SANDOW UNITS ...................................12

C. INSTALLATION OF REPLACEMENT SANDOW UNITS ...............15

D. SHUTDOWN OF EXISTING SANDOW UNITS .......................17

E. INTERIM POLLUTION REDUCTION MEASURES ....................17

F. NOx, SO2, AND PM EMISSIONS MONITORING ......................19

G. SURRENDER OF EMISSION ALLOWANCES ........................22

V USE OF EMISSION ALLOWANCES ......................................25

VI PROHIBITION ON NETTING CREDITS OR OFFSETS FROM REQUIRED

CONTROLS ..........................................................26

VII PERMITS .............................................................27

VIII RESOLUTION OF PAST CIVIL CLAIMS ..................................29

IX RESOLUTION OF FUTURE CIVIL CLAIMS - COVENANTS NOT TO SUE ......29

X PERIODIC REPORTING ................................................31

XI ENVIRONMENTAL MITIGATION PROJECTS .............................33

XII REVIEW AND APPROVAL OF SUBMITTALS .............................37

ii 
XIII CIVIL PENALTY ......................................................37

XIV STIPULATED PENALTIES ..............................................38

XV FORCE MAJEURE .....................................................44

XVI DISPUTE RESOLUTION ................................................47

XVII INFORMATION COLLECTION AND RETENTION .........................50

XVIII NOTICES .............................................................52

XIX SALES OR TRANSFERS OF OWNERSHIP INTERESTS ......................54

XX MODIFICATION ......................................................55

XXI ENFORCEMENT THROUGH TITLE V PERMIT ............................56

XXII TERMINATION .......................................................57

XXIII GENERAL PROVISIONS ...............................................57

XXIV SIGNATORIES AND SERVICE ..........................................60

XXV FINAL JUDGMENT ....................................................61

iii 
WHEREAS, Alcoa Inc. (“Alcoa”), formerly the Aluminum Company of America, is a 

Pennsylvania corporation that owns and operates certain aluminum smelting facilities throughout 

the United States, including a smelter complex in Milam County, Rockdale, Texas; 

WHEREAS, Alcoa also generates some of the electricity for its Rockdale Smelter facility 

by means of three electricity-generating units at the Rockdale facility known as Sandow Units 1, 

2, and 3; 

WHEREAS, the United States of America (“the United States”) on behalf of the United 

States Environmental Protection Agency (“EPA”) is filing with this Consent Decree a Complaint 

against Alcoa, pursuant to Sections 113(b) and 167 of the Clean Air Act, 42 U.S.C. §§ 7413(b) 

and 7467, against Alcoa for injunctive relief and civil penalties for alleged violations of: the 

Prevention of Significant Deterioration (“PSD”) provisions in Part C of Subpart I of the Act, 42 

U.S.C. §§ 7470-92; and the federally-enforceable State Implementation Plan developed by the 

State of Texas (the “Texas SIP”), 30 T.A.C. § 116.160; 

WHEREAS, on October 23, 2001, Neighbors for Neighbors, Inc., Environmental 

Defense, and Public Citizen, Inc., (collectively, the “Citizen Groups”) filed a notice of intent to 

sue Alcoa for declaratory and injunctive relief and civil penalties for violations of the Clean Air 

Act’s federal PSD regulations, 40 C.F.R. 52.21 et seq., the federal New Source Performance 

Standards (“NSPS”), 40 C.F.R. § 60.1 et seq., and the Texas SIP, 40 C.F.R. 52.2270 et seq.; 

WHEREAS, the Citizen Groups filed their complaint in this action on December 26, 

2001 alleging violations of the Clean Air Act as set forth in their notice letter; 

WHEREAS, in both of these Complaints, Plaintiffs allege, inter alia, that Alcoa failed to 

obtain the necessary permits and install the controls necessary under the Act to reduce its sulfur 

1
dioxide, nitrogen oxides, and/or particulate matter emissions; 

WHEREAS, the Plaintiffs’ Complaints allege claims upon which relief can be granted 

against Alcoa under Sections 113, 167, and 304 of the Act, 42 U.S.C. §§ 7413, 7477, and 7604, 

and 28 U.S.C. § 1355; 

WHEREAS, on January 29, 2002 Alcoa provided an Answer to the Citizen’s Group 

Complaint but has not answered or otherwise responded to the Complaint of the United States in 

light of the settlement memorialized in this Consent Decree; 

WHEREAS, Alcoa denies the violations alleged in the Complaints, maintains that it has 

been and remains in compliance with the Act and is not liable for civil penalties or injunctive 

relief, and states that it is agreeing to the obligations imposed by this Consent Decree solely to 

avoid the costs and uncertainties of litigation and to improve the environment; 

WHEREAS, on or before January 9, 2002, EPA provided Alcoa and the State of Texas 

with actual notice of Alcoa’s alleged violations, in accordance with Section 113(a)(1) of the 

Clean Air Act, 42 U.S.C. § 7413(a)(1); 

WHEREAS, on January 9, 2002, the Texas Commission on Environmental Quality 

(“TCEQ”), then known as the Texas Natural Resource Conservation Commission, issued an 

administrative notice of enforcement to Alcoa indicating that Alcoa had violated Texas Health 

and Safety Code § 382.085; 

WHEREAS, the Parties recognize, and the Court by entering this Consent Decree finds, 

that this Consent Decree has been negotiated in good faith and at arm’s length and that this 

Consent Decree is fair, reasonable, consistent with the goals of the Act, and in the public 

interest; 

2
WHEREAS, the United States, the Citizen Groups and Alcoa support this settlement and 

agree that the provisions of this Consent Decree are in the public interest; 

WHEREAS, the United States, the Citizen Groups, and Alcoa have consented to entry of 

this Consent Decree without trial of any issue; 

NOW, THEREFORE, without any admission of fact or law, and without any admission 

of the violations alleged in the Complaint, it is hereby ORDERED, ADJUDGED, AND 

DECREED as follows: 

I. JURISDICTION AND VENUE 

1. This Court has jurisdiction over the subject matter herein and over this action pursuant to 

28 U.S.C. §§ 1331, 1345, 1355, and 1367, and pursuant to Sections 113, 167, and 304 of 

the Act, 42 U.S.C. §§ 7413, 7477 and 7604. This Court also has personal jurisdiction 

over Alcoa. 

2. Venue is proper under Section 113(b) of the Act, 42 U.S.C. § 7413(b), and under 

28 U.S.C. § 1391(b) and (c). Solely for the purposes of this Consent Decree and the 

underlying Complaints, Alcoa waives all objections and defenses that it may have to the 

claims set forth in the Complaints, the jurisdiction of the Court, or to venue in this 

District. Alcoa and the Citizen Groups shall not challenge the terms of this Consent 

Decree or this Court’s jurisdiction to enter and enforce this Consent Decree. Upon entry, 

no Party shall challenge the terms of this Consent Decree. 

3. The Court shall retain jurisdiction of this case after entry of this Consent Decree to 

enforce compliance with the terms and conditions of this Consent Decree and to take any 

action necessary or appropriate for its enforcement, interpretation, execution, 

3
modification, or adjudication of disputes. During the term of this Consent Decree, any 

Party may apply to the Court for any relief necessary to construe or effectuate this 

Consent Decree. 

II. APPLICABILITY 

4. The provisions of this Consent Decree shall apply to and be binding upon the United 

States and the Citizen Groups, and upon Alcoa, its successors and assigns, as well as 

Alcoa’s officers, employees, and agents solely in their capacities as such. 

5. Alcoa shall provide a copy of this Consent Decree to all vendors, suppliers, consultants, 

contractors, agents, and any other company or other organization performing any of the 

work described in Sections IV (Pollution Controls and Reductions) or XI (Environmental 

Mitigation Projects) of this Consent Decree. 

6. Notwithstanding any retention of contractors, subcontractors, or agents to perform any 

work required under this Consent Decree, Alcoa shall be responsible for ensuring that all 

work is performed in compliance with the requirements of this Consent Decree. 

7. In any action to enforce this Consent Decree, Alcoa shall not assert as a defense the 

failure of its officers, directors, employees, servants, agents, or contractors to take actions 

necessary to comply with this Consent Decree, unless Alcoa establishes that such failure 

resulted from a Force Majeure event as defined in this Consent Decree. 

III. DEFINITIONS 

8. “30-Day Rolling Average Emission Rate” for a Unit means and is calculated by (a) 

summing the total pounds of pollutant in question emitted from the Unit during an 

Operating Day and the previous twenty-nine (29) Operating Days; (b) summing the total 

4
heat input to the Unit in mmBTU during the Operating Day and during the previous 

twenty-nine (29) Operating Days; and (c) dividing the total number of pounds of 

pollutants emitted during the thirty (30) Operating Days by the total heat input during the 

thirty (30) Operating Days, and (d) converting the resulting figure to lbs/mmBTU. A 

new 30-Day Rolling Average Emission Rate shall be calculated for each new Operating 

Day. Each 30-Day Rolling Average Emission Rate shall include all periods of startup, 

shutdown, and Malfunction that occur during an Operating Day. A Malfunction shall be 

excluded from this Emission Rate, however, if it is determined to be a Force Majeure 

Event and satisfies the Force Majeure provisions of this Consent Decree. 

9. “30-Day Rolling Average Removal Efficiency” for a Unit means and is calculated by (a) 

summing Removal Efficiency for a pollutant at a Unit during an Operating Day and the 

previous twenty-nine (29) Operating Days and (b) dividing sum by thirty (30). A new 

30-Day Rolling Average Removal Efficiency shall be calculated for each new Operating 

Day. Each 30-Day Rolling Average Removal Efficiency shall include all periods of 

startup, shutdown, and Malfunction that occur during an Operating Day. A Malfunction 

shall be excluded from this Removal Efficiency, however, if it is determined to be a 

Force Majeure Event and satisfies the Force Majeure provisions of this Consent Decree. 

10. “Act” or the “Clean Air Act” shall mean the Federal Clean Air Act, 42 U.S.C. §§ 7401 

through 7671q, and its implementing regulations. 

11. “BACT” or “Best Available Control Technology” shall mean the emission limitations 

determined by technical study, analysis, review, and selection of pollution control 

recommendations performed in connection with an application for a federal PSD permit. 

5
Such study, analysis, review, and selection of recommendations shall be carried out in 

conformance with all applicable federal and state regulations and guidance describing the 

process and analysis for determining BACT, as that term is defined in the Clean Air Act 

at 42 U.S.C. § 7479(3) and 40 C.F.R. § 52.21(b)(12), and in the Texas State 

Implementation Plan at 40 C.F.R. § 52.2270(c), and 30 T.A.C. § 116.160(a). 

11. “CEMS” or “Continuous Emission Monitoring System,” for obligations involving NO

and SO2 under this Consent Decree, shall mean “CEMS” as defined in 40 C.F.R. § 72.2 

and installed and maintained as required by 40 C.F.R. Part 75. 

x 

12. “Coal” shall include lignite. 

13. “Commercial Operation” shall mean the generation of electricity for use at Alcoa’s 

Rockdale facility or for sale within or outside of Alcoa. 

14. “COMS” or “Continuous Opacity Monitoring System” shall mean equipment that 

samples, analyzes, measures, and provides, by readings taken at frequent intervals, a 

permanent record of the opacity of Alcoa’s emissions, in accordance with 40 C.F.R. Part 

60, Appendix B, Specification 1. 

15. “Construction” shall mean physical, on-site construction. 

16. “Consent Decree” shall mean this Consent Decree. 

17. “Emission Rate” shall mean the number of pounds of pollutant emitted per million BTU 

of heat input (“lb/mmBTU”), measured in compliance with this Consent Decree. 

18. “EPA” shall mean the United States Environmental Protection Agency. 

19. “ESP” shall mean electrostatic precipitator, a pollution control device for the reduction of 

particulate matter (PM). 

6
20. “Existing Sandow Units” shall mean the three lignite-fired, approximately 125-MW 

electricity generating units operated by Alcoa at its Milam County, Rockdale, Texas 

facility as of the date of lodging of this Consent Decree. 

21. “Flue gas desulfurization system,” or “FGD,” means an add-on emission control device 

used to remove sulfur dioxide (SO2) from a Unit’s flue gas. 

22. “Fossil fuel” shall mean any hydrocarbon fuel, including Coal, petroleum coke, 

petroleum oil, lignite, or natural gas. 

23. “lb/mmBTU” shall mean pounds per million British Thermal Units of heat input, based 

on higher heating value (“hhv”). 

24. “MW” means a megawatt, or one million Watts. Each Watt is a unit of power equal to 

one ampere per volt. 

25. “NOx” shall mean oxides of nitrogen, as measured in compliance with the provisions of 

this Consent Decree . 

26. “NOx Allowance” shall mean an authorization under state or federal law to emit an 

amount of nitrogen oxide, where each allowance can be sold, traded, or otherwise 

transferred to achieve compliance with state or federal emissions limitations. 

27. “NOx Emission Rate” shall mean the number of pounds of NO

of heat input (“lb/mmBTU”), with no bypass of NOx emission control equipment, 

measured as required by this Consent Decree. 

x emitted per million BTU 

28. “NSR” shall mean the nonattainment area new source review program within the 

meaning of Part D of Subchapter I of the Act, 42 U.S.C. §§ 7510-7515, 40 C.F.R. 

Part 51, and 30 T.A.C. § 116.160. 

7
29. “Operating Day” shall mean any calendar day in which Coal is combusted in the boiler of 

a Unit for more than 12 hours including periods of startup, shutdown, and Malfunction. 

If Coal is combusted for more than 12 but less than 24 hours during a calendar day, the 

calculation of that day's emissions for the Unit shall be based upon the hourly CEMS data 

collected during hours in which Coal was combusted in the Unit, and shall not include 

any time in which Coal was not combusted. Any period of Malfunction shall be 

excluded from an Operating Day, however, if the Malfunction constitutes a Force 

Majeure Event and satisfies the Force Majeure provisions of this Consent Decree. 

30. “Parties” shall mean the United States, the Citizen Groups, and Alcoa. “Party” shall refer 

to any one of these Parties. 

31. “Permit Amendment” shall mean the uncontested final agency action respecting Alcoa’s 

application, filed on November 1, 2002, to amend TCEQ Permit No. 48437. A challenge 

by Alcoa of such final agency action shall render the final agency action “uncontested” 

for purposes of this Consent Decree. 

32. “Plaintiffs” shall mean the United States and the Citizen Groups. 

33. “PM” shall mean total particulate matter, as measured in compliance with the provisions 

of this Consent Decree. 

34. “PM CEMS” or “PM continuous emission monitoring system” shall mean equipment that 

samples, analyzes, measures, and provides, by readings taken at frequent intervals, a 

permanent record of PM emissions. 

35. “PM Emission Rate” shall mean the average number of pounds of PM emitted per million 

BTU of heat input (“lb/mmBTU”), with no bypass of PM emission control equipment, as 

8
measured in compliance with the provisions of this Consent Decree. 

36. “Project Dollars” shall mean Alcoa’s expenditures and payments incurred or made in 

carrying out the projects identified in Section XI (Environmental Mitigation Projects) of 

this Consent Decree to the extent that such expenditures or payments both: (a) comply 

with the Project Dollar and other requirements established in this Section of the Consent 

Decree for such expenditures and payments; and (b) constitute Alcoa’s documented 

external costs for contractors, vendors, as well as equipment, and its internal costs 

consisting of employee time, travel, and other out-of-pocket expenses specifically 

attributable to these particular projects and documented according to generally accepted 

accounting principles. 

37. “PSD” shall mean Prevention of Significant Deterioration within the meaning of Part C, 

Subpart I of the Clean Air Act, 42 U.S.C. §§ 7470-7492 and 40 C.F.R. Part 52. 

38. “Removal Efficiency” shall mean the percent reduction in the emitted mass of a pollutant 

achieved by a Unit’s pollution control device that Alcoa operates at a Unit. This 

percentage shall be calculated by subtracting the outlet Emission Rate from the inlet 

Emission Rate, dividing the difference by the inlet Emission Rate, and then multiplying 

the result by 100. 

39. “Replacement Sandow Units” shall mean the Units installed at Alcoa’s Rockdale 

operations in Milam County, Rockdale, Texas to replace the Existing Sandow Units, such 

that the new Units generate electricity through the use of a fluidized-bed boiler or other 

comparable technology that reduces NOx, SO2, and PM emissions, and that is in 

compliance with this Consent Decree and any other requirements contained in any permit 

9
issued by TCEQ to Alcoa for that Unit and with any other federal or state requirements. 

The Replacement Sandow Units may utilize all existing ancillary equipment or systems 

necessary for the production of electricity, including coal pulverizers or other equipment, 

but shall not use the existing lignite dryers after the shutdown of the Existing Sandow 

Units. 

40. “SCR” shall mean a pollution control device that employs selective catalytic reduction 

x technology for the reduction of NO .

41. “SO2" shall mean sulfur dioxide, as measured in compliance with this Consent Decree. 

42. “SO2 Allowance” shall mean “allowance,” as defined at 42 U.S.C. § 7651a(3): an 

authorization, allocated to an affected Unit, by the Administrator of EPA under 

Subchapter IV-A of the Act, to emit, during or after a specified calendar year, one ton of 

sulfur dioxide. 

43. “SO2 Emission Rate” shall mean the pounds of SO2 emitted per million BTU of heat 

input (“lb/mmBTU”), with no bypass of SO2 emission control equipment, measured as 

required by this Consent Decree. 

44. “State” shall mean the State of Texas. 

45. “State Permitting Process” shall mean the permitting procedures required by State 

regulations, which shall include, at a minimum, (a) a BACT determination for the Unit(s) 

in question, and (b) public notice and comment on the proposed permit. 

46. “TCEQ” shall mean the Texas Commission on Environmental Quality. 

47. “Title V Permit” shall mean the permit required of Alcoa’s major sources under 

Subchapter V of the Clean Air Act, 42 U.S.C. §§ 7661-7661e and T.A.C. § 122. 

10
48. “Unit” shall mean, collectively, the coal pulverizer, the stationary equipment that feeds 

coal to the boiler, the boiler that produces steam for the steam turbine, the steam turbine, 

the generator, the equipment necessary to operate the generator, steam turbine and boiler, 

and all ancillary equipment, including lignite dryers and pollution control equipment, or 

systems necessary for the production of electricity. 

IV. POLLUTION CONTROLS AND REDUCTIONS 

A. SELECTION OF POLLUTION REDUCTION APPROACH 

49. Within twelve (12) months of the issuance of the Permit Amendment, Alcoa shall select 

one of the three pollution reduction options set forth below for the Existing Sandow 

Units, and shall notify the Plaintiffs and TCEQ in writing as to which option Alcoa has 

selected for these Units: 

a. the continued utilization of the Existing Sandow Units, and the installation of 

pollution control equipment at these Units in compliance with Paragraphs 51 

through 59 of this Consent Decree (“Option A”); 

b. the installation of Replacement Sandow Units for the Existing Sandow Units, 

with the installation and operation of pollution controls as required by the State 

Permitting Process, in compliance with Paragraphs 60 through 67 of this Consent 

Decree (“Option B”); or 

c. the shutdown of the Existing Sandow Units, in compliance with Paragraph 68 of 

this Consent Decree (“Option C”). 

50. After providing Plaintiffs and TCEQ with written notice of its selected approach, Alcoa 

shall implement the selected approach in compliance with the schedule set forth in this 

11
Consent Decree for that selected approach. 

B. INSTALLATION OF POLLUTION CONTROL EQUIPMENT 

AT EXISTING SANDOW UNITS - Option A 

51. If Alcoa elects to continue to utilize its Existing Sandow Units under Option A in 

Paragraph 49, above, Alcoa shall install and operate pollution control equipment for such 

Units in compliance with Paragraphs 52 through 59 of this Subsection, IV(B). 

i. NOx Emission Limits 

52. By no later than the dates specified in the table below, Alcoa shall commence physical, 

on-site construction and install and commence operation of SCRs on the Existing 

Sandow Units in compliance with the requirements of this Consent Decree. Beginning 

on the dates specified below, Alcoa shall operate each SCR (or SCR-alternative 

technology approved by Plaintiffs pursuant to Paragraph 54 of this Consent Decree) to 

achieve and maintain a 30-Day Rolling Average NOx Emission Rate of no greater than 

0.10 lb/mmBTU at each of these Units. 

Existing 

Sandow Unit 

Unit 1 

Unit 2 

Unit 3 

Construction 

Commencement 

Deadline 

June 30, 2004 

June 30, 2005 

September 1, 2005 

NOx Compliance 

Deadline 

December 31, 2005 

December 31, 2006 

March 1, 2007 

53. Alcoa shall continuously operate each SCR at all times that Alcoa operates such Units, 

except that, as long as Alcoa is maximizing heat transfer to the SCR, Alcoa need not 

operate an SCR whenever the temperature of the flue gas at the SCR system inlet is less 

than the minimum operating temperature specified by the SCR catalyst manufacturer. 

12 
Within 30 days of executing a contract for each SCR, Alcoa shall provide to Plaintiffs the 

minimum operating temperature specified by the SCR catalyst manufacturer, as well as 

Alcoa’s and the catalyst manufacturer’s technical support and justification for this 

specified temperature. 

54. Alcoa may install technology other than SCRs in satisfaction of the NOx control 

obligations of this Section if the alternative technology is designed to achieve the same or 

better NOx Emission Rate required in Paragraph 52, above, and is approved in writing by 

Plaintiffs prior to the time a contract for its purchase is executed. 

ii. SO2 Emission Limits 

55. By no later than the dates specified in the table below, Alcoa shall commence physical 

on-site construction and install and commence operation of flue gas desulfurization 

systems (“FGDs”) on Existing Sandow Units in compliance with the requirements of this 

Consent Decree. Beginning on these same dates, Alcoa shall operate each FGD (or 

FGD-alternative technology approved by Plaintiffs pursuant to Paragraph 57 of this 

Consent Decree) to achieve and maintain at each of these Units (a) a 30-Day Rolling 

Average SO2 Emission Rate of no greater than 0.20 lb/mmBTU and (b) a 30-Day Rolling 

Average Removal Efficiency of 95%. 

Existing Sandow 

Unit 

Unit 1 

Unit 2 

Unit 3 

Construction 

Commencement 

Deadline 

June 30, 2004 

June 30, 2005 

September 1, 2005 

SO2 Compliance 

Deadline 

December 31, 2005 

December 31, 2006 

March 1, 2007 

13
56. Alcoa shall operate each FGD required by this Consent Decree at all times that the Unit it 

serves is in operation, except that following the startup of a Unit, Alcoa need not operate 

the FGD while the Unit it serves is not firing Coal. 

57. Alcoa may install technology other than FGDs in satisfaction of the SO2 control 

obligations of this Section if the alternative technology is designed to achieve the same or 

better SO2 Emission Rate and Removal Efficiency required in Paragraph 55, above, and 

is approved in writing by Plaintiffs prior to its installation. 

iii. PM Emission Controls 

58. Beginning on the dates specified in the table below, Alcoa shall commence physical onsite construction and operate all necessary controls at each of the Existing Sandow Units 

to achieve and maintain at each of these Units (a) a PM Emission Rate of no greater than 

0.030 lb/mmBTU and (b) an opacity limit of 10 percent on a 6-minute average, with only 

those exceptions as allowed by law. Alcoa shall complete all necessary upgrades to the 

PM emission control equipment at each of the Existing Sandow Units to ensure 

compliance with the PM Emission Rate, opacity limit and schedule. 

Existing Sandow 

Unit 

Construction 

Commencement Deadline 

PM Compliance 

Deadline 

Unit 1 June 30, 2004 December 31, 2005 

Unit 2 June 30, 2005 December 31, 2006 

Unit 3 September 1, 2005 March 1, 2007 

59. Alcoa shall operate the PM control equipment at all times that the Unit it serves is in 

operation. 

14
C. INSTALLATION OF REPLACEMENT SANDOW UNITS -

Option B 

60. If Alcoa elects to install the Replacement Sandow Units under Option B of Paragraph 49, 

above, Alcoa shall shut down the boilers at the Existing Sandow Units, and shall 

construct the Replacement Sandow Units in compliance with Paragraphs 61 through 67 

of this Subsection, IV(C). Alcoa shall install and operate emission controls on each of 

the Replacement Sandow Units to achieve and maintain the emission limitations 

established as BACT for SO2, NOx, and PM. 

61. On November 1, 2002, Alcoa submitted an application to amend the Voluntary 

Emissions Reduction Permit (“VERP”) , TCEQ Permit No. 48437 (“Permit”). This 

amendment application was submitted to determine the appropriate pollution controls and 

other requirements for each of the Replacement Sandow Units, and to comply with this 

Consent Decree’s State Permitting Process requirements for the construction and 

operation of the Replacement Sandow Units. 

62. Within 30 days of EPA’s receipt of TCEQ’s issuance of an amendment to Alcoa’s VERP 

under the State Permitting Process, EPA shall notify Alcoa and TCEQ if it wishes to 

dispute TCEQ’s determination of BACT in the Permit Amendment. Such disputes shall 

be governed by Paragraph 147 in Section XVI (Dispute Resolution) of this Consent 

Decree. If EPA prevails in the dispute, Alcoa shall submit a revised permit application to 

TCEQ within 30 days that is consistent with the Court’s determination. If Alcoa prevails, 

it shall install pollution controls and achieve emission reductions that comply with the 

requirements of the permit issued by TCEQ. 

63. Regardless of the emission rates and other limitations set forth in the Permit Amendment 

15
issued by TCEQ, Alcoa shall operate its Replacement Sandow Units to achieve and 

maintain 30-Day Rolling Average Emission Rates that are no less stringent than the 

following 30-Day Rolling Average Emission Rates: 0.10 lbs/mmBTU NOx, 0.20 

lbs/mmBTU SO2, and 0.015 lbs/mmBTU PM. Alcoa shall have six months from the 

commencement of commercial operation of each Replacement Sandow Unit to achieve 

compliance with these Emission Rates. 

64. All emission rates and limitations within the Permit Amendment, as well as all 

subsequent renewals and revisions of the requirements in the Permit Amendment, shall 

be enforceable under this Consent Decree by the United States and, subject to the 

limitations of this Consent Decree, the Citizen Groups. 

65. On or before forty-three (43) months after receiving the Permit Amendment, Alcoa shall 

(a) begin operation of the first Replacement Sandow Unit in accordance with all State 

permit requirements and (b) shut down the same amount of electricity generating 

capacity (in MW) at the Existing Sandow Units as the electricity generating capacity of 

the first Replacement Sandow Unit. 

66. On or before forty-seven (47) months after receiving the Permit Amendment, but no later 

than December 31, 2007, Alcoa shall (a) operate each Replacement Sandow Unit in 

accordance with all State permit requirements and (b) complete the permanent shutdown 

of all of the Existing Sandow Units. 

67. No later than the dates specified in the table below, Alcoa shall commence physical, onsite construction and operate all necessary controls at the Replacement Sandow Units to 

achieve and maintain at each of these Units the emission rates and other limitations and 

16
requirements in accordance with the State permits. 

Unit Construction 

Commencement Deadline 

Commencement of 

Operation 

First Replacement Sandow 

Unit 

19 months after Permit 

Amendment issuance 

43 months after Permit 

Amendment issuance 

Other Replacement Sandow 

Units 

23 months after Permit 

Amendment issuance 

47 months after Permit 

Amendment issuance or 

by December 31, 2007, 

whichever is earlier 

D. SHUTDOWN OF ELECTRICITY GENERATING UNITS - Option C 

68. If Alcoa elects to shut down the Existing Sandow Units under Option C of Paragraph 49, 

above, Alcoa shall complete the shutdown of these Units by no later than December 31, 

2006. 

E. INTERIM POLLUTION REDUCTION MEASURES 

i. NOx Reductions 

69. Commencing January 1, 2003, Alcoa shall operate low-NOx burners and overfire air on 

each of the Existing Sandow Units to achieve and maintain a NOx Emission Rate of no 

greater than 0.60 lbs/mmBTU and shall not emit more than 9,730 tons of NOx from all 

three Existing Sandow Units on a calendar year basis (“annual NOx tonnage limitation”). 

The annual tonnage of NOx emitted by Alcoa in a calendar year shall be calculated using 

Alcoa’s NOx Emission Rate(s) for that year in accordance with TCEQ Agreed Order No. 

2000-0032-SIP. For periods of time less than a calendar year, compliance with the 

annual NOx tonnage limitation shall be determined on a prorated basis. 

17
ii. SO2 Reductions and Fuel Limitations 

70. Alcoa shall not burn Coal or other Fossil Fuel having a sulfur content greater than any 

amount authorized by regulation or permit at the Existing or Replacement Sandow Units. 

The sulfur content of Coal or other fuels shall be expressed as pound(s) of SO2 per 

mmBTU (lb SO2 / mm BTU) as determined by the testing requirements described in 

TCEQ Agreed Order No. 95-0583-SIP, as incorporated into the Texas SIP at 40 C.F.R. 

§ 52.2270(c)(101). In addition, Alcoa shall not burn any fuel other than Coal, except as 

authorized by regulation or permit, at the Existing or Replacement Sandow Units. 

71. Beginning three months after the entry of this Consent Decree, Alcoa shall operate the 

Existing Sandow Units to limit annual tons of SO2 emitted to an amount equal to or less 

than the product of 3.50 lbs of SO2/mmBTU multiplied by the total annual heat input of 

lignite combusted at Alcoa’s Existing Sandow Units in a particular calendar year. For 

periods of time less than a calendar year, compliance with this annual SO2 tonnage 

limitation shall be determined on a prorated basis. The obligation in this Paragraph 

terminates as follows: If Alcoa elects and complies with Compliance Option A, 

December 31, 2005. If Alcoa elects and complies with Compliance Option B, December 

31 of the year Alcoa commences Commercial Operation of the first Replacement Sandow 

Unit. If Alcoa elects and complies with Compliance Option C, December 31, 2006. 

iii. PM Reductions 

72. Within 45 days after entry of this Consent Decree and continuing thereafter, Alcoa shall 

operate each of the Existing Sandow Units to maximize PM emission reductions, 

consistent with the operational and maintenance limitations of the Units. Specifically, 

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Alcoa shall, at a minimum: (a) energize each section of the ESP for each of the Existing 

Sandow Units, regardless of whether that action is needed to comply with opacity limits, 

and (b) maintain the energy or power levels delivered to the ESPs for each of the Existing 

Sandow Units to achieve the greatest possible removal of PM; and (c) make best efforts 

to expeditiously repair and return to service transformer-rectifier sets when they fail. 

iv. Opacity Compliance 

73. Beginning on the date of entry of this Consent Decree, Alcoa shall not allow emissions 

from the Existing Sandow Units to exceed an opacity limitation of 30 percent on a 6-

minute average, with only those exceptions as allowed by law. 

74. Alcoa shall demonstrate compliance with the interim opacity limits in this Consent 

Decree with Continuous Opacity Monitors at each stack. 

F. NOx, SO2, AND PM EMISSIONS MONITORING 

75. If Alcoa elects to install pollution controls on its Existing Sandow Units (Option A), 

Alcoa shall commence operation of CEMS for NOx and SO2 and PM, and COMS for 

opacity, no later than the date required by this Consent Decree for the commencement of 

operation of the pollution control equipment at these Units. If Alcoa elects to install 

Replacement Sandow Units (Option B), Alcoa shall commence operation of CEMS for 

NOx and SO2 and PM, and COMS for opacity, no later than the date required by this 

Consent Decree for the commencement of operation of the Replacement Sandow Units. 

If Alcoa elects to permanently shut down the Existing Sandow Units (Option C), Alcoa 

shall not be required to install and operate CEMS for NOx and SO2 and PM CEMS at any 

of the existing Units. 

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76. At least six (6) months prior to the installation of CEMS for NOx, SO2, and PM, and 

COMS for opacity, at the Existing or Replacment Sandow Units, Alcoa shall submit to 

EPA for approval pursuant to Section XII (Review and Approval of Submittals) a plan 

showing the proposed placement of the CEMS on these Units and the protocol that shall 

be followed in calibrating such CEMS. Upon approval by EPA, after EPA consults with 

the Citizen Groups and TCEQ, Alcoa shall install, calibrate, and operate the CEMS in 

compliance with the EPA-approved protocol and all applicable statutes, regulations, and 

EPA guidance governing such CEMS. EPA shall approve or disapprove the plan within 

180 days of receipt. 

77. Following installation of each CEMS for NOx, SO2, and PM at the Existing or 

Replacement Sandow Units, Alcoa shall include in its periodic reports to the Plaintiffs 

pursuant to Section X (Periodic Reporting) of this Consent Decree all data recorded by 

the CEMS in electronic format. 

A. For purposes of determining compliance with the NOx Emission Rates in this 

Consent Decree, Alcoa shall measure all NOx emissions using CEMS certified 

and operated in compliance with 40 C.F.R. Part 75 and the NOx CEMS protocol 

submitted by Alcoa and approved by EPA. 

B. For the purposes of determining compliance with the SO2 Emission Rates in this 

Consent Decree, Alcoa shall measure all SO2 emissions using CEMS certified and 

operated in compliance with 40 C.F.R. Part 75 and the SO2 CEMS protocol 

submitted by Alcoa and approved by EPA. 

C. For the purposes of determining compliance with the PM Emission Rates in this 

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Consent Decree, Alcoa shall measure PM emissions using stack testing and the 

reference methods in 40 C.F.R. Part 60; provided, however, that Alcoa shall 

measure PM emissions using PM CEMS once EPA issues a final rulemaking 

promulgating a reference method or methods for PM CEMS. Alcoa shall install 

and calibrate such PM CEMS protocol submitted by Alcoa and approved by EPA. 

78. Beginning in 2003, and semi-annually every calendar year thereafter until one year after 

the PM CEMS required by Paragraphs 75 are operational (or, if Alcoa elects Option C, 

until Alcoa shuts down the Existing Sandow Units), Alcoa shall conduct stack testing for 

PM emissions at the Existing and Replacement Sandow Units in compliance with the 

reference method and emission calculation set forth in Paragraph 77, above, the 

requirements set forth in Alcoa’s permits issued by TCEQ, and State regulations. 

A. Alcoa shall calculate the PM Emission Rates from all stack tests in compliance 

with 40 C.F.R. § 60.8(f). 

B. Alcoa shall report to EPA the results of its stack tests within 60 days of 

conducting such tests, unless EPA provides Alcoa with additional time in which 

to submit such test results. Alcoa’s stack tests conducted as required by its 

permits from the State of Texas may be used to satisfy the annual stack test 

requirement imposed by this Paragraph. 

79. For the purposes of determining compliance with the opacity limits in this Consent 

Decree, Alcoa shall maintain, calibrate and operate Continuous Opacity Monitors to 

measure accurately the opacity of emissions at the Existing Sandow Units (and, if Alcoa 

elects Option B, the Replacement Sandow Units) in compliance with the requirements 

21
found at 40 C.F.R. Part 60, Appendix B, Specification 1 and Part 75. 

G. SURRENDER OF EMISSION ALLOWANCES 

80. The requirements of Paragraphs 81 through 87 of this Subsection regarding the surrender 

of emission allowances shall apply only to the extent that the Units participate in a state 

or federal emissions trading program such as the Acid Rain Program under Title IV of the 

Act. 

81. For purposes of this Subsection, the term “surrender of allowances” means permanently 

surrendering allowances from the Existing Sandow Units or Replacement Sandow Units 

accounts administered by EPA or the State of Texas so that such allowances can never be 

used to meet any compliance requirement under the Clean Air Act, the Texas State 

Implementation Plan, or this Consent Decree. 

i. Surrender of SO2 Allowances 

82. Beginning during the year specified in Paragraph 55 for the commencement of operation 

of an FGD on each Existing Sandow Unit if Alcoa elects Option A, or beginning during 

the year specified in Paragraphs 65 and 66 for the commencement of the Replacement 

Sandow Units if Alcoa elects Option B, Alcoa shall retain SO2 Allowances for those 

Units only for purposes of compliance with federal law, and shall surrender all other SO2 

Allowances. Alcoa shall not sell, trade, or otherwise transfer any SO2 Allowances to a 

third party or use such SO2 Allowances in any other facility owned or operated by Alcoa 

or by any affiliate of Alcoa, except as provided in Paragraph 89, below. By March 30 of 

the year following the calendar year for which the SO2 Allowances were allocated, Alcoa 

shall surrender to the EPA any SO2 Allowances required to be surrendered under this 

22
Consent Decree, or transfer them to a non-profit third party selected by Alcoa for 

purposes of surrender. 

83. If any SO2 Allowances are transferred directly to a non-profit third party, Alcoa shall 

submit a report of such transfer to Plaintiffs within seven (7) business days of such 

transfer, in compliance with Section XVIII (Notices) of this Consent Decree. Such report 

shall: (i) provide the identity of the non-profit third-party recipient(s) of the SO2 

Allowances and a listing of the serial numbers of the transferred SO2 Allowances; and (ii) 

include a certification by the third-party recipient(s) stating that the recipient will not sell, 

trade, or otherwise exchange any of the SO2 Allowances and will not use any of the SO2 

Allowances to meet any obligation imposed by any environmental law. Alcoa shall also 

demonstrate, in the periodic reports submitted to EPA pursuant to Section X (Periodic 

Reporting) of this Consent Decree, that the third-party recipient(s) surrendered the SO2 

Allowances for permanent surrender to EPA within one year after Alcoa transferred the 

SO2 Allowances to them. Alcoa shall not have complied with the SO2 Allowance 

surrender requirements of this Paragraph until all third-party recipient(s) shall have 

actually surrendered the transferred SO2 Allowances to EPA for surrender. 

84. For all SO2 Allowances surrendered to EPA, Alcoa shall first submit an SO2 Allowance 

transfer request form to EPA’s Office of Air and Radiation’s Clean Air Markets Division 

directing the transfer of the SO2 Allowances held or controlled by Alcoa to the EPA 

Enforcement Surrender Account or to any other EPA account that the Agency may direct. 

As part of submitting these transfer requests, Alcoa shall irrevocably authorize the 

transfer of these SO2 Allowances and identify -- by name of account and any applicable 

23
serial or other identification numbers or station names -- the source and location of the 

SO2 Allowances being surrendered. 

ii. Surrender of NOx Allowances 

85. Beginning during the year specified in Paragraphs 52 for the commencement of operation 

of an SCR on each Existing Sandow Unit if Alcoa elects Option A, or beginning during 

the year specified in Paragraphs 65 and 66 for the commencement of the Replacement 

Sandow Units if Alcoa elects Option B, Alcoa shall retain NOx Allowances for those 

Units only for purposes of compliance with federal law, and shall surrender all other NOx 

Allowances. Alcoa shall not sell, trade, or otherwise transfer any NOx Allowances to a 

third party or use such NOx Allowances in any other facility owned or operated by Alcoa 

or by any affiliate of Alcoa, except as provided in Paragraph 89, below. By March 30 of 

the year following the calendar year for which the NOx Allowances were allocated, Alcoa 

shall surrender to the EPA (or to the State, if the State is the authority granting the NOx 

Allowances) any NOx Allowances required to be surrendered under this Consent Decree, 

or transfer them to a non-profit third party selected by Alcoa for purposes of surrender. 

86. If any NOx Allowances are transferred directly to a non-profit third party, Alcoa shall 

submit a report of such transfer to Plaintiffs within seven (7) business days of such 

transfer, in accordance with Section XVIII (Notices) of this Consent Decree. Such report 

shall: (i) provide the identity of the non-profit third-party recipient(s) of the allowances 

and a listing of the serial numbers of the transferred NOx Allowances; (ii) demonstrate 

that the third-party recipient(s) will not sell, trade, or otherwise exchange any of the NOx 

Allowances; (iii) demonstrate that the third party recipient(s) will not use any of the NOx 

24
Allowances to meet any obligation imposed by any environmental law; and (iv) 

demonstrate that the third-party recipient(s) will surrender the NOx Allowances for 

permanent surrender to EPA within one year after Alcoa transfers the NOx Allowances to 

the third-party recipient(s). Alcoa shall not have complied with the NOx Allowance 

surrender requirements of this Paragraph until all third-party recipient(s) shall have 

actually surrendered the transferred NOx Allowances to EPA for surrender. 

87. For all NOx Allowances surrendered to EPA, Alcoa shall first submit a NOx Allowance 

transfer request form to EPA’s Office of Air and Radiation’s Clean Air Markets Division 

directing the transfer of the NOx Allowances held or controlled by Alcoa to the EPA 

Enforcement Surrender Account or to any other EPA account that the Agency may direct. 

As part of submitting these transfer requests, Alcoa shall irrevocably authorize the 

transfer of these NOx Allowances and identify - by name of account and any applicable 

serial or other identification numbers or station names - the source and location of the 

NOx Allowances being surrendered. 

V. USE OF EMISSION ALLOWANCES 

88. For any and all actions taken by Alcoa pursuant to the terms of this Consent Decree, 

x or SO2 Allowances in any emission trading 

or marketing program of any kind. 

Alcoa shall not use or sell any resulting NO

89. Nothing in this Consent Decree shall preclude Alcoa from using, selling, or transferring 

emission allowances allocated to the Existing Sandow Units or to the Replacement 

Sandow Units arising from either: (a) Alcoa’s emission reductions at these Units that 

occur prior to the date of entry of this Consent Decree; or (b) Alcoa’s emission 

25
reductions at these Units to the extent that they go beyond the requirements of this 

Consent Decree and that occur after the date of entry of this Consent Decree. If Alcoa 

elects Option B, for example, Alcoa may use, sell, or transfer NOx or SO2 Allowances 

allocated to the Replacement Sandow Units to the extent that Alcoa reduces its NOx or 

SO2 emissions beyond the reductions required by this Consent Decree. 

90. Nothing in this Consent Decree shall preclude Alcoa from purchasing emission 

allowances from another source or obtaining them from the EPA or any state with respect 

to facilities other than Sandow for purposes of complying with state or federal Clean Air 

Act requirements. 

VI. PROHIBITION ON NETTING CREDITS OR OFFSETS 

FROM REQUIRED CONTROLS 

91. For any and all actions taken by Alcoa to comply with the terms of this Consent Decree, 

including but not limited to the upgrade or installation of particulate matter controls, 

FGDs, and SCRs, any emission reductions generated shall not be considered as a 

creditable contemporaneous emission decrease for the purpose of obtaining netting 

credits or offsets under the Act’s PSD or NSR programs. This prohibition shall not 

prohibit Alcoa from seeking to amend its existing VERP for any and all actions taken by 

Alcoa to comply with the terms of this Consent Decree under Option B, including the 

construction of Replacement Sandow Units, any emission reductions generated shall be 

considered as a creditable contemporaneous emission decrease for the purpose of 

obtaining netting credits or offsets under the Act's PSD or NSR programs solely to the 

extent that such credits are necessary under the State Permitting Process for authorization 

of the Permit Amendment. In addition, this prohibition shall not preclude Alcoa from 

26
applying emission decreases from the elimination of its lignite dryers to potential 

emission increases from any ancillary equipment at the source necessary for the operation 

of the Replacement Sandow Units. 

VII. PERMITS 

Timely Application for Permits 

92. Except as otherwise stated in this Consent Decree, in any instance where otherwise 

applicable law or this Consent Decree requires Alcoa to secure a permit to authorize the 

construction, modification, or operation of any Unit or Unit component under this 

Consent Decree, Alcoa shall make such application in a timely and complete manner. 

Such applications shall be completed and submitted to the appropriate authorities to 

allow sufficient time for all legally required processing and review of the permit request. 

Any failure by Alcoa to submit a timely permit application for the Existing Sandow Units 

or Replacement Sandow Units shall bar any use by Alcoa of the Force Majeure 

provisions of this Consent Decree to allege that it failed to install or operate a Unit as 

required by this Consent Decree because a permitting authority failed to issue a necessary 

permit in a timely manner. Nothing in this Consent Decree shall be construed to relieve 

Alcoa of any obligation to comply with Texas’s permitting requirements pursuant to 30 

Tex. Admin. Code. § 116. 

Title V Permits. 

93. Within sixty (60) days of entry of this Consent Decree, Alcoa shall amend its existing 

Title V Permit application covering the Existing Sandow Units or apply for an 

amendment of its Title V Permit covering the Existing Sandow Units, to include a 

27
schedule for interim performance, operational, maintenance, and control technology 

requirements established by this Consent Decree, including but not limited to emission 

limits, limits on fuel use, and operation and maintenance requirements. 

94. Within sixty (60) days after commencement of operation of each pollution control device 

in Section IV (Pollution Controls and Reductions) of this Consent Decree, and in 

compliance with 30 Tex. Admin. Code § 122, Alcoa shall submit a proposed 

modification to its Title V permit for the Rockdale facility to reflect the emission 

limitations and other requirements for each Sandow Unit as set forth in Section IV, which 

shall become federally-enforceable under Alcoa’s Title V permit once it is modified. 

Such proposed modification shall include, to the extent applicable, the surrender of 

allowances under Subsection IV(G) (Surrender of Emission Allowances) of this Consent 

Decree. Alcoa shall also include the emission limitations and other requirements in 

Section IV of this Consent Decree in any subsequent renewal or revision of its Title V 

permit. 

95. Except as this Consent Decree requires a State Permitting Process for the replacement of 

the Existing Sandow Units with Replacement Sandow Units, this Consent Decree shall 

not be construed to require Alcoa to apply for or obtain a permit pursuant to Parts C and 

D in Title I of the Clean Air Act for any work performed by Alcoa within the scope of the 

Resolution of Claims provisions of Paragraphs 96 and 97, below. Nothing in this 

Consent Decree shall be construed to relieve Alcoa of any obligation to comply with 

Title V of the Clean Air Act and TCEQ’s implementing regulations. 

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VIII. RESOLUTION OF PAST CLAIMS 

96. Compliance with this Consent Decree shall resolve Alcoa’s civil liability for violations at 

the Existing Sandow Units that have arisen from its actions at these Units prior to the 

date on which this Consent Decree is lodged with the Court of: (a) the Prevention of 

Significant Deterioration (“PSD”) or Non-Attainment New Source Review (“NSR”) 

provisions of Parts C and D in Title I of the Clean Air Act; and (b) the 

Federally-enforceable PSD and NSR provisions incorporated into 30 Tex. Admin. Code § 

116.160. 

IX. RESOLUTION OF FUTURE CIVIL CLAIMS - COVENANTS NOT TO SUE 

97. As long as Alcoa remains in compliance with the deadlines contained in Section IV 

(Pollution Controls and Reductions) of this Consent Decree, and subject to the limitations 

specified in Paragraphs 98 and 99, the Plaintiffs covenant not to sue Alcoa and its 

successors and assigns for civil claims arising from the PSD or Nonattainment NSR 

provisions of Parts C and D in Title I of the Clean Air Act, 42 U.S.C. § 7401 et seq., at 

the Existing Sandow Units or Replacement Sandow Units based on failure to obtain PSD 

or Nonattainment NSR permits for: 

a. physical changes or changes in the method of operation at the Existing Sandow 

Units or the Replacement Sandow Units, after the date of lodging of this Consent 

Decree, that this Consent Decree expressly directs Alcoa to undertake; or 

b. physical changes or changes in the method of operation at the Existing Sandow 

Units or the Replacement Sandow Units, after the date of lodging of this Consent 

Decree, that are not required by this Consent Decree, if and only if Alcoa is 

29
otherwise in compliance with: Section IV (Pollution Controls and Reductions), 

other than the 30-Day and PM Emission Rates contained in Paragraphs 52, 55, 

and 58 (if Alcoa elects Option A) and Paragraphs 60, 62, and 63 (if Alcoa elects 

Option B); and Section VII (Permits) of this Consent Decree. 

Limitations on the Future Covenant Not To Sue 

98. The covenant not to sue in Paragraph 97 does not apply to physical changes or changes in 

the method of operation, either individually or collectively for a Unit, at the Existing 

Sandow Units or the Replacement Sandow Units which constitute a “modification” as 

determined according to 40 C.F.R. § 60.14(h), and which increase by more than 10 

percent the maximum hourly emission rates for NOx, SO2, or any other pollutant 

regulated under the applicable New Source Performance Standard. 

99. Notwithstanding any other provisions of this Consent Decree, the covenant not to sue in 

Paragraph 97 shall continue in effect until, and terminate on, December 31, 2009, and is 

without any force or effect as to any physical change or change in the method of 

operation of a Unit commenced or completed after that date. 

Effect of this Section on Alcoa. 

100. This Section of the Consent Decree does not: (a) impose any affirmative obligation on 

Alcoa; (b) preclude Alcoa from obtaining a PSD or Nonattainment NSR permit for a 

modification of a Unit that would be subject to the limitations contained in Paragraphs 98 

and 99 of this Section; or (c) relieve Alcoa of any obligation imposed on it by other 

Sections of this Consent Decree. 

30
X. PERIODIC REPORTING 

101. Within 180 days after each date established by this Consent Decree for Alcoa to achieve 

and maintain a certain Emission Rate or limit at the Existing Sandow Units or the 

Replacement Sandow Units, Alcoa shall: (a) conduct performance tests to determine its 

compliance with the Emission Rate or limit required by this Consent Decree; and (b) 

submit the results of the performance test to EPA, TCEQ, and the Citizen Groups at the 

addresses specified in Section XVIII (Notices) of this Consent Decree. 

102. Beginning thirty days after the end of the first full calendar quarter following the entry of 

this Consent Decree and continuing on a semi-annual basis, Alcoa shall submit to the 

Plaintiffs a report containing the following information: 

a. all information necessary to determine compliance with Section IV (Pollution 

Controls and Reductions) of this Consent Decree; 

b. all information necessary to determine whether Alcoa has complied with the 

future covenant restriction and reopener contained in Paragraph 98; and 

c. all information relating to emission allowances and credits that Alcoa claims to 

have generated in accordance with Paragraph 89 by compliance beyond the 

requirements of this Consent Decree. 

103. In any periodic progress report submitted pursuant to this Section, Alcoa may incorporate 

by reference information previously submitted under its Title V permitting requirements, 

provided that Alcoa attaches the Title V permit report and provides a specific reference to 

the provisions of the Title V permit report that are responsive to the information sought 

in the periodic progress report. 

31
104. In addition to the progress reports required pursuant to this Section, Alcoa shall report to 

the Plaintiffs any violation of the requirements of this Consent Decree, including 

excedances of the required Emission Rates, within 10 days of when Alcoa knew or 

should have known of any such violation or excedance. In this report, Alcoa shall 

explain the cause or causes of the violation or excedance and all measures taken or to be 

taken by Alcoa to prevent such event in the future. Alcoa shall also report, in the 

periodic progress reports submitted pursuant to this Section, any violations of this 

Consent Decree that Alcoa anticipates regarding the deadlines for installing and 

commencing operation of any new or upgraded pollution control device required by this 

Consent Decree. 

105. Each Alcoa report shall be signed by Alcoa’s Rockdale Power and Mine Manager, or, in 

his or her absence, a higher ranking official, and shall contain the following certification: 

This information was prepared either by me or under my direction or 

supervision in accordance with a system designed to assure that qualified 

personnel properly gather and evaluate the information submitted. Based 

on my evaluation, or the directions and my inquiry of the person(s) who 

manage the system, or the person(s) directly responsible for gathering the 

information, I hereby certify under penalty of law that, to the best of my 

knowledge and belief, this information is true, accurate, and complete. I 

understand that there are significant penalties for submitting false, 

inaccurate, or incomplete information to the United States. 

106. If any allowances are surrendered to any third party pursuant to Subsection IV(G) of this 

32
Consent Decree, the third party’s certification shall be signed by a managing officer of 

the third party and shall contain the following language: 

I certify under penalty of law that _____________ [name of third party] 

will not sell, trade, or otherwise exchange any of the allowances and will 

not use any of the allowances to meet any obligation imposed by any 

environmental law. I understand that there are significant penalties for 

making false, inaccurate, or incomplete information to the United States. 

XI. ENVIRONMENTAL MITIGATION PROJECTS 

107. Within 30 days of entry of this Consent Decree, Alcoa shall deposit the sum of 

$2,500,000 into an interest bearing escrow account within the Court registry. Such 

amount and all accrued interest shall be dedicated to the environmental mitigation 

projects set forth in this Section of the Consent Decree. 

108. Within 60 days of entry of this Consent Decree Alcoa shall direct the Court escrow 

registry to provide funding in the amount of $1,750,000, plus accrued interest, to the 

Trust for Public Land for the purchase and/or maintenance of property and/or 

conservation easements designed to extend and protect the clean air and existing Houston 

toad habitat of the "Lost Pines" and Post Oak Savannah areas of Bastrop and Lee 

Counties in Central Texas. Alcoa shall further specify in its directions to the Court 

escrow registry the following: 

A. All purchases or projects undertaken with these funds by the Trust for Public 

Land must first be approved by Pines & Prairies Land Trust; 

B. All deeds and easements purchased by the Trust for Public Land must be held 

33
jointly by the Pines & Prairies Land Trust and the Trust for Public Land; 

C. the Trust for Public Land may convey its property interest to Pines and Prairie 

Land Trust; and 

D. The Trust for Public Lands and the Pines & Prairies Land Trust may not 

encumber any property or property interest acquired pursuant to this Consent 

Decree with any deed of trust, mortgage, pledge, security interest, or other lien or 

interest of similar nature granted to secure any loan, financing or other 

indebtedness (referred to herein as a "Lien"). The Trust for Public Land and 

Pines and Prairie Land Trust must encumber each property and easement acquired 

pursuant to this Consent Decree with a restrictive covenant prohibiting the grant 

of any Lien upon such property or easement, and further providing that the grant 

of any such Lien shall be null and void, ab initio. The restrictive covenant may be 

created in the deed for the acquisition of the property or easement, or created in a 

separate instrument recorded in the appropriate real property records, and shall 

provide that it is enforceable by the Trust for Public Lands, the Pines & Prairies 

Land Trust, and the Parties. Furthermore, the Trust for Public Lands and the 

Pines & Prairies Land Trust shall create a conditional limitation in each 

acquisition of property pursuant to the Consent Decree (either in the deed or by 

separate instrument recorded in the appropriate real property records) providing 

that, for the seventy-five (75) year period following such acquisition, if either the 

Trust for Public Lands or the Pines & Prairies Land Trust dissolve, become 

insolvent, or grants or attempts to grant a Lien upon any property interests 

34
acquired pursuant to this Consent Decree (a "Dissolving/Defaulting Trust 

Entity"), then the subject property interest, if held by the Dissolving/Defaulting 

Trust Entity, shall automatically revert to and vest in the other trust entity (the 

"Conforming Entity") without the necessity of any further act on the part of or 

behalf of either entities. If for any reason this conditional limitation does not 

create a determinable estate, then it shall be deemed to grant and create in the 

Conforming Entity an option to purchase such property interest for $10.00. 

109. Within 60 days of entry of this Consent Decree, Alcoa shall direct the Court escrow 

registry provide funding in the amount of $750,000, plus accrued interest, to implement a 

school bus emission reduction program for the greater Austin, Texas area similar to the 

Adopt-A-School-Bus program in the Dallas, Texas area. Within 120 days of entry of this 

Consent Decree, the Parties shall agree on an administrator (the “Administrator”) for this 

school bus emission reduction program. The school bus emission reduction program 

shall cover at least the following counties: Milam, Lee, Bastrop, Caldwell, Hays, Travis, 

and Williamson. In providing this funding, Alcoa shall specify that the following 

conditions must be met: 

a. $700,000 is to be used directly for bus improvement projects and not for any 

administrative costs; 

b. While the Administrator may use administrative funds for the greater Austin 

program, with respect to the funds specified in Subparagraph (a) above, the 

Administrator shall first seek to obtain emission reductions from the school bus 

fleets for the public school districts in Rockdale Independent School District, 

35
Lexington Independent School District, Elgin Independent School District, 

Cameron Independent School District, and McDade Independent School District. 

If any funds remain, the Administrator shall obtain emission reductions from 

school bus fleets in other public school districts in Milam, Lee, and Bastrop 

Counties, in that order; 

c. The Administrator shall expend the funds in a way to minimize the cost per unit 

of pollution reduced from the school bus fleets identified in Subparagraph (b) 

above; and 

d. The school bus improvement projects funded must be other than those already 

required by law or already under contract. 

110. All plans and reports prepared by Alcoa pursuant to the requirements of this Section of 

the Consent Decree shall be publicly available without charge. 

111. Alcoa shall certify, as part of each plan submitted to Plaintiffs for any Mitigation Project, 

that it is unaware that any person other than Alcoa is required by law to perform the 

Project described in the plan. 

112. Alcoa acknowledges that it will receive credit for the expenditure of such funds as 

Project Dollars only if Alcoa demonstrates that the funds have been actually spent by 

either Alcoa or by the person or instrumentality receiving them, and that such 

expenditures met all requirements of this Consent Decree. 

113. No later than the periodic report due sixty (60) or more days following the completion of 

each approved Project, Alcoa shall submit to Plaintiffs for review and approval pursuant 

to Section XII (Review and Approval of Submittals) of this Consent Decree a report that 

36
documents the date that all aspects of the project were implemented, Alcoa’s results in 

implementing the project, including the emission reductions or other environmental 

benefits achieved, and the Project Dollars expended by Alcoa in implementing the 

project. 

XII. REVIEW AND APPROVAL OF SUBMITTALS 

114. Alcoa shall submit a complete plan, report, or other item to EPA, TCEQ, and the Citizen 

Groups whenever such a document is required to be submitted to EPA for review and 

approval pursuant to this Consent Decree. EPA may approve the submittal or decline to 

approve it and provide written comments. Within 60 days of receiving EPA’s written 

comments, Alcoa shall either: (i) alter the submittal consistent with the written comments 

and provide the revised submittal to EPA for final approval; or (ii) submit the matter for 

dispute resolution, including the period of informal negotiations, under Section XVI 

(Dispute Resolution) of this Consent Decree. 

115. Upon receipt of EPA’s final approval of the submittal, or upon completion of the 

submittal pursuant to dispute resolution, Alcoa shall implement the submittal in 

compliance with the approved submittal. 

XIII. CIVIL PENALTY 

116. Within thirty (30) calendar days of entry of this Consent Decree, Alcoa shall pay to the 

United States a civil penalty in the amount of $1.5 million. The civil penalty shall be 

paid by Electronic Funds Transfer ("EFT") to the United States Department of Justice, in 

compliance with current EFT procedures, referencing the USAO File Number 

and DOJ Case Number 90-5-2-1-07723, and the civil action case names and case 

37
numbers referenced in the caption of this Consent Decree. The costs of such EFT shall 

be Alcoa’s responsibility. Payment shall be made in compliance with instructions 

provided to Alcoa by the Financial Litigation Unit of the U.S. Attorney's Office for the 

Western District of Texas. Any funds received after 4:00 p.m. (CST) shall be credited on 

the next business day. At the time of payment, Alcoa shall provide notice of payment, 

referencing the USAO File Number, DOJ Case Number, and the civil action case name 

and case number, to the Department of Justice and to EPA, as provided in Section XVIII 

(Notices) of this Consent Decree. 

117. Failure to timely pay the civil penalty shall subject Alcoa to interest accruing from the 

date payment is due until the date payment is made at the rate prescribed by 28 U.S.C. § 

1961, and shall render Alcoa liable for all charges, costs, fees, and penalties established 

by law for the benefit of a creditor or of the United States in securing payment. 

XIV. STIPULATED PENALTIES 

118. For any failure by Alcoa to comply with the terms of this Consent Decree, and subject to 

the provisions of Sections XV (Force Majeure) and XVI (Dispute Resolution), Alcoa 

shall pay, within 30 days after written demand to Alcoa by either by the United States or 

by the United States and the Citizen Groups jointly, the following stipulated penalties to 

EPA: 

Consent Decree Violation Stipulated Penalty 

(Per day per violation, unless 

otherwise specified) 

A. Failure to pay the civil penalty as specified in Section 

XIII (Civil Penalty) of this Consent Decree 

$10,000 

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B. Each 30-Day Rolling Average Emission Rate, each 30-

Day Rolling Average Removal Efficiency, and any other 

Emission Rate or emission limitation (including any 

emissions limitation in any State permit relating to the 

Replacement Sandow Units) that is less than 5% in excess 

of the limits set forth in this Consent Decree 

$2,500 

C. Each 30-Day Rolling Average Emission Rate, each 30-

Day Rolling Average Removal Efficiency, and any other 

Emission Rate or emission limitation (including any 

emissions limitation in any State permit relating to the 

Replacement Sandow Units) that is greater than 5% but less 

than 10% in excess of the limits set forth in this Consent 

Decree 

$5,000 

D. Each 30-Day Rolling Average Emission Rate, each 30-

Day Rolling Average Removal Efficiency, and any other 

Emission Rate or emission limitation (including any 

emissions limitation in any State permit relating to the 

Replacement Sandow Units) that is greater than 10% in 

excess of the limits set forth in this Consent Decree 

$10,000 

E. Violation of an applicable opacity limit, as required by 

Paragraph 73 (opacity compliance) 

$5,000 per each six minute 

period 

F. Failure to meet the annual SO2 emission limitations in 

Paragraph 71 

The acquisition and retirement, 

in accordance with this Consent 

Decree, of one and one half 

SO2 Allowances for every ton 

of SO2 in excess of the annual 

SO2 emissions limitation. 

G. Burning any fuel other than Coal, except as authorized 

by regulation or permit, as required in Paragraph 70 

$10,000 

H. Failure to install, commence operation, or continue 

operation of the NOx and PM pollution control devices on 

the Existing Sandow Units, as specified in Subsection 

IV(E) (Interim Pollution Reduction Measures), unless 

Alcoa elects to shut down these Units in accordance with 

Subsection IV(A) (Selection of Pollution Reduction 

Approach) 

$10,000 during the first 30 

days, $27,500 thereafter 

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I. Failure to commence physical, on-site construction of the 

NOx, SO2, and PM pollution control devices on the Existing 

Sandow Units, in accordance with the schedule in 

Paragraphs 52, 55, and 58 (Option A); or 

Failure to commence physical, on-site construction of the 

Replacement Sandow Units, in accordance with the 

schedule in Paragraph 67 (Option B); or 

Failure to shut down the Existing Sandow Units in 

accordance with the schedule in Paragraph 68 (Option C) 

Payment by Alcoa of either (a) 

$2,500 directly to the United 

States or (b) $5,000 placed by 

Alcoa in an escrow account. 

Any amounts placed by Alcoa 

into escrow shall be be 

refunded to Alcoa when Alcoa 

either (i) commences timely 

operation of the emission 

controls on the Existing 

Sandow Units (Option A) or 

commences operation of the 

Replacement Sandow Units 

(Option B) in accordance with 

the schedules and Emission 

Rates set forth in this Consent 

Decree; or (ii) permanently 

shuts down by the Existing 

Sandow Units by December 31, 

2006. 

J. Failure to install or operate CEMS or COMS as required 

by Paragraphs 75 through 77, and 79 

$1,000 

K. Failure to conduct any stack test or annual performance 

test of PM emissions, as required in Paragraph 78 

$2,500 

L. Failure to apply for the permits required by Paragraphs 

92 through 94 

$1,000 

M. Failure to timely submit, modify, or implement as 

approved the reports, plans, studies, analyses, protocols, or 

other submittals required by this Consent Decree 

$750 for the first ten days 

$1,500 for the eleventh through 

the 30th day 

$2,000 thereafter 

N. Using, selling, or transferring SO2 Allowances, except 

as permitted by Paragraphs 80 through 84, and 88 through 

91 

(a) $2,000 per SO2 Allowance 

ton, plus (b) the surrender, 

pursuant to the procedures set 

forth in Subsection IV(G) of 

this Consent Decree, of SO2 

Allowances in an amount equal 

to the SO2 Allowances used, 

sold, or transferred in violation 

of this Consent Decree 

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O. Using, selling, or transferring NOx Allowances or 

credits, except as permitted in Paragraphs 85 through 91 

(a) $4,000 per NOx Allowance 

or credit ton, plus (b) the 

surrender, pursuant to the 

procedures set forth in 

Subsection IV(G) of this 

Consent Decree, of NOx 

Allowances or credits in an 

amount equal to the NOx 

Allowances or credits used, 

sold, or transferred in violation 

of this Consent Decree 

P. Failure to demonstrate the third party surrender of a SO2 

Allowance to EPA within one year after Alcoa’s transfer of 

such Allowance to the third party pursuant to Paragraph 83 

(a) $2,000 per SO2 Allowance 

ton, plus (b) the surrender, 

pursuant to the procedures set 

forth in Subsection IV(G) of 

this Consent Decree, of SO2 

Allowances in an amount equal 

to the SO2 Allowances used, 

sold, or transferred in violation 

of this Consent Decree 

Q. Failure to demonstrate the third party surrender of a 

NOx Allowance or credit to EPA within one year after 

Alcoa’s transfer of such allowance or credit to the third 

party as required by Paragraph 86 

(a) $4,000 per NOx Allowance 

or credit ton, plus (b) the 

surrender, pursuant to the 

procedures set forth in 

Subsection IV(G) of this 

Consent Decree, of NOx 

Allowances or credits in an 

amount equal to the NOx 

Allowances or credits used, 

sold, or transferred in violation 

of this Consent Decree 

R. Failure to undertake and complete any of the 

Environmental Mitigation Projects in compliance with 

Section XI (Environmental Mitigation Projects) 

$2,500 for the first 15 days, 

$5,000 thereafter 

S. Any other violation of this Consent Decree $1,000 

119. Violation of an Emission Rate or Removal Efficiency that is based on a 30-Day Rolling 

Average is a violation on every day of the 30-day period on which the average is based. 

120. Where a violation of a 30-Day Rolling Average Emission Rate or Removal Efficiency 

41
(for the same pollutant and from the same source) recurs within periods less than 30 days, 

Alcoa shall not pay a daily stipulated penalty for any day of the recurrence for which a 

stipulated penalty has already been paid. 

121. All stipulated penalties shall begin to accrue on the day after the performance is due or on 

the day a violation occurs, whichever is applicable, and shall continue to accrue until 

performance is satisfactorily completed or until the violation ceases. Nothing herein 

shall prevent the simultaneous accrual of separate penalties for separate violations of this 

Consent Decree. 

122. Alcoa shall pay all stipulated penalties due to the United States under Paragraph 118 

within 30 days of any violation of this Consent Decree, and shall continue to make such 

payments every 30 days thereafter until the violation(s) no longer continues, unless Alcoa 

elects within 20 days of the violation to dispute the accrual of stipulated penalties in 

accordance with the provisions in Section XVI (Dispute Resolution) of this Consent 

Decree. 

123. Penalties shall continue to accrue as provided in accordance with Paragraph 121 during 

any dispute, with interest on accrued penalties payable and calculated at the rate 

established by the Secretary of the Treasury, pursuant to 28 U.S.C. § 1961, but need not 

be paid until the following: 

a. If the dispute is resolved by agreement or by a decision of the United States, or by 

agreement of the Plaintiffs if stipulated penalties are jointly assessed by the 

Plaintiffs, and the agreement or decision is not appealed to the Court, accrued 

penalties determined to be owing, together with accrued interest, shall be paid to 

42
the United States within thirty (30) days of the effective date of the agreement or 

the receipt of EPA’s decision or order; 

b. If the dispute is appealed to the Court, and the United States prevails in whole or 

in part, (or, if the Plaintiffs jointly assess stipulated penalties, the Plaintiffs prevail 

in whole or in part), Alcoa shall, within sixty (60) days of receipt of the Court’s 

decision or order, pay all accrued penalties determined by the Court to be owing, 

together with accrued interest, except as provided in Subparagraph c, below; 

c. If the District Court’s decision is appealed by any Party, Alcoa shall, within 

fifteen (15) days of receipt of the final appellate court decision, pay all accrued 

penalties determined to be owing to the United States, together with accrued 

interest. 

124. All stipulated penalties must be paid in the manner set forth in Section XIII (Civil 

Penalty) of this Consent Decree. 

125. Should Alcoa fail to pay stipulated penalties in compliance with the terms of this Consent 

Decree, the United States shall be entitled to collect interest on such penalties, as 

provided for in 28 U.S.C. § 1961, together with the costs (including attorneys fees) 

incurred in any action necessary to collect any such stipulated penalties or interest 

thereon. 

126. The stipulated penalties provided for in this Consent Decree shall be in addition to any 

other rights, remedies, or sanctions available to any Plaintiff by reason of Alcoa’s failure 

to comply with any requirement of this Consent Decree or applicable law, except that for 

any violation of the Act for which this Consent Decree also provides for payment of a 

43
stipulated penalty, Alcoa shall be allowed a credit for stipulated penalties paid against 

any statutory penalties imposed for such violation. 

XV. FORCE MAJEURE 

127. Force Majeure. For purposes of this Consent Decree, a “Force Majeure Event” shall 

mean an event that has been or will be caused by circumstances beyond the control of 

Alcoa, its contractors, or any entity controlled by Alcoa that delays compliance with any 

provision of this Consent Decree or otherwise causes a violation of any provision of this 

Consent Decree despite Alcoa’s best efforts to fulfill the obligation. “Best efforts” 

include using best efforts to anticipate any potential Force Majeure Event and to address 

the effects of any such event (a) as it is occurring and (b) after it has occurred, such that 

the delay or violation is minimized to the greatest extent possible. 

128. Notice. If any event occurs or has occurred that may delay compliance with or otherwise 

cause a violation of any obligation under this Consent Decree, as to which Alcoa intends 

to assert a claim of force majeure, Alcoa shall notify the Plaintiffs in writing as soon as 

practicable, but in no event later than seven (7) business days following the date Alcoa 

first knew, or by the exercise of due diligence should have known, that the Force Majeure 

Event caused or may cause such delay or violation. In this notice Alcoa shall reference 

this Paragraph of this Consent Decree and describe the anticipated length of time that the 

delay or violation may persist, the cause or causes of the delay or violation, all measures 

taken or to be taken by Alcoa to prevent or minimize the delay or violation, the schedule 

by which those measures will be implemented, and Alcoa’s rationale for attributing a 

delay or violation to Force Majeure Event. Alcoa shall adopt all reasonable measures to 

44
avoid or minimize such delays or violations. Alcoa shall be deemed to know of any 

circumstance of which Alcoa, its contractors, or any entity controlled by Alcoa knew or 

should have known. 

129. Failure to Give Notice. Failure by Alcoa to comply with the notice requirements of this 

Section shall render Alcoa’s claim of Force Majeure voidable by any Plaintiff as to the 

specific event for which Alcoa has failed to comply with such notice requirement. 

130. Plaintiffs’ Response. The United States shall notify the Parties, in writing, of its position 

regarding Alcoa's claim of Force Majeure within (30) thirty business days of receipt of 

the notice provided under Paragraph 128. Any Party that disagrees with the stated 

position of the United States may invoke the dispute resolution provisions of this Consent 

Decree. If the Parties agree that a delay in performance has been or will be caused by a 

Force Majeure Event, then the Parties shall stipulate to an extension of deadline(s) for 

performance of the affected compliance requirement by a period not to exceed the delay 

actually caused by the event. 

131. Burden of Proof. In any dispute regarding Force Majeure, Alcoa shall bear the burden of 

proving by a preponderance of the evidence that any delay in performance or any other 

violation of any requirement of this Consent Decree was caused by or will be caused by a 

Force Majeure Event. Alcoa shall also bear the burden of proving that Alcoa gave the 

notice required by this Section and the duration and extent of any delay(s) attributable to 

a Force Majeure Event. An extension of one compliance date based on a particular event 

may, but will not necessarily, result in an extension of a subsequent compliance date. 

132. Events Excluded. Unanticipated or increased costs or expenses associated with the 

45
performance of Alcoa's obligations under this Consent Decree shall not constitute a 

Force Majeure Event. 

133. Potential Force Majeure Events. The Plaintiffs agree that, depending upon the 

circumstances related to an event and Alcoa’s response to such circumstances, the kinds 

of events listed below could qualify as Force Majeure Events within the meaning of this 

Section: construction, labor, or equipment delays; acts of God; acts of war; acts of 

terrorism; and Malfunctions, as defined herein. 

134. Failure of a permitting authority to issue a necessary permit in a timely fashion may 

constitute a Force Majeure Event where the failure of the permitting authority to act is 

beyond the control of Alcoa and Alcoa has taken all steps available to it to obtain the 

necessary permit, including, but not limited to, submitting a complete permit application, 

responding to requests for additional information by the permitting authority in a timely 

fashion, accepting lawful permit terms and conditions, and prosecuting in an expeditious 

fashion appeals of any allegedly unlawful terms and conditions imposed by the 

permitting authority. Notwithstanding the foregoing, no Force Majeure Event arising 

from permitting delays shall alter Alcoa’s obligations to comply with the deadline and 

requirements set forth in Paragraph 66 of this Consent Decree regarding the shut down of 

the Existing Sandow Units. 

135. In the event any Force Majeure Event or Events cause Alcoa to fail to comply with any 

deadline in this Consent Decree for more than six months, any Plaintiff may go to this 

Court to seek further relief consistent with the objectives of this Consent Decree. 

136. Notwithstanding any other provision of this Consent Decree, this Court shall not draw 

46
any inferences nor establish any presumptions adverse to any Party as a result of Alcoa 

delivering a notice pursuant to this Section or the inability of Alcoa and the Plaintiffs to 

reach agreement on a dispute under this Section. 

137. For purposes of this Section, a “Malfunction” shall have the meaning set forth in 40 

C.F.R. § 60.2: any sudden, infrequent, and not reasonably preventable failure of air 

pollution control equipment, process equipment, or a process to operate in a normal or 

usual manner. Failures that are caused in part by poor maintenance or careless operation 

are not Malfunctions. 

138. As part of the resolution of any matter submitted to this Court under this Section, the 

Plaintiffs and Alcoa by agreement, or this Court by order, may in appropriate 

circumstances extend or modify the schedule for completion of work under this Consent 

Decree to account for the delay in the work that occurred as a result of any delay agreed 

to by the United States or approved by this Court. Alcoa shall be liable for stipulated 

penalties for its failure thereafter to complete the work in compliance with the extended 

or modified schedule. 

XVI. DISPUTE RESOLUTION 

139. The dispute resolution procedure provided by this Section shall be available to resolve all 

disputes arising under this Consent Decree, provided that the Party making such 

application has first made a good faith attempt to resolve the matter with the other 

Parties. 

140. The dispute resolution procedure required herein shall be invoked by a Plaintiff giving 

written notice to Alcoa or by Alcoa giving notice to Plaintiffs advising of a dispute 

47
pursuant to this Section. The notice shall describe the nature of the dispute and shall 

state the noticing Party's position with regard to such dispute. The Party receiving such a 

notice shall acknowledge receipt of the notice, and the Parties shall expeditiously 

schedule a meeting to discuss the dispute informally not later than fourteen (14) days 

following receipt of such notice. 

141. Disputes submitted to dispute resolution under this Section shall, in the first instance, be 

the subject of informal negotiations among the Parties. Such period of informal 

negotiations shall not extend beyond thirty (30) calendar days from the date of the first 

meeting among the Parties’ representatives unless they agree to shorten or extend this 

period. 

142. If the Parties are unable to reach agreement during the informal negotiation period, the 

Plaintiffs shall provide Alcoa with a written summary of their position regarding the 

dispute. In disputes between the Citizen Groups and Alcoa, Alcoa shall file with this 

Court a petition which describes the nature of the dispute and seeks resolution, within 30 

days of receiving the written summary of the Citizen Groups’ position. In disputes 

between the United States and Alcoa, the written position of the United States shall be 

considered binding unless Alcoa files with this Court a petition which describes the 

nature of the dispute and seeks resolution, within thirty (30) calendar days of receiving 

the United States’ written summary of its position. In either case, the Plaintiffs may 

respond to a petition by Alcoa within forty-five (45) calendar days of its filing. 

143. Where the nature of the dispute is such that a more timely resolution of the issue is 

required, the time periods set out in this Section may be shortened upon motion of one of 

48
the Parties to the dispute. 

144. This Court shall not draw any inferences nor establish any presumptions adverse to either 

Party as a result of invocation of this Section or the Parties' inability to reach agreement. 

145. The Court shall decide all disputes pursuant to applicable principles of law for resolving 

such disputes. The Parties, in their initial filings with the Court under Paragraph 142, 

above, shall state their position regarding what the applicable standard of law should be 

for resolving the particular dispute. 

146. As part of the resolution of any dispute under this Section, in appropriate circumstances 

the Parties may agree, or this Court may order, an extension or modification of the 

schedule for completion of work under this Consent Decree to account for the delay that 

occurred as a result of dispute resolution. Alcoa shall be liable for stipulated penalties 

for its failure thereafter to complete the work in compliance with the extended or 

modified schedule. 

147. As to disputes by the United States regarding the Permit Amendment issued by TCEQ, 

the following provisions shall apply: 

a. EPA shall have the a right to dispute the BACT determination in the State 

Permitting Process and to resolve such dispute before this Court. 

b. Within 30 days of receipt of the Permit amendment issued by TCEQ under the State 

Permitting Process, if EPA does not agree with any provision of the TCEQ-issued 

permit, including but not limited to TCEQ's determination of the Best Available 

Control Technology (BACT), EPA shall notify Alcoa and TCEQ. The notice shall 

describe the reason for disagreeing with the provisions in the TCEQ-issued Permit 

49
Amendment. The EPA, TCEQ, and Alcoa shall endeavor to resolve the dispute 

informally for not more than twenty (20) days following issuance of such notice. If 

the parties do not reach an agreement during this informal process, EPA shall 

provide Alcoa with a written summary of their positions regarding their objections to 

the TCEQ-issued Permit Amendment. 

c. If EPA disputes TCEQ’s Permit Amendment pursuant to Subparagraph 147(b), 

above, then the written position(s) provided by the United States shall be considered 

binding unless, within fifteen (15) calendar days thereafter, Alcoa files with this 

Court a petition which describes the nature of the dispute and seeks resolution. EPA 

shall respond to Alcoa’s petition within fifteen (15) calendar days of its filing. 

d. Disputes arising under this Paragraph shall be determined by this Court under a de 

novo standard of review. This Court shall not draw any inferences nor establish any 

presumptions adverse to either party as a result of invocation of this Section or the 

parties' inability to reach agreement. 

XVII. INFORMATION COLLECTION AND RETENTION 

148. Any authorized representative of United States or TCEQ, including their attorneys, 

contractors, and consultants, upon presentation of credentials, shall have a right of entry 

upon the Rockdale Plant, at any reasonable time for the purpose of: 

a. monitoring the progress of activities required under this Consent Decree; 

b. verifying any data or information submitted in accordance with the terms of this 

Consent Decree; 

c. obtaining samples; and 

50
d. assessing Alcoa’s compliance with this Consent Decree. 

149. Until five (5) years after the expiration of the covenant not to sue in Paragraph 97, Alcoa 

shall retain, and instruct its contractors and agents to preserve, all non-identical copies of all 

records and documents (including records and documents in electronic form) now in its or 

its contractors’ or agents’ possession or control, and that relate in any manner to Alcoa’s 

performance of its obligations under this Consent Decree. This record retention requirement 

shall apply regardless of any corporate document-retention policy to the contrary. 

150. At the conclusion of the document-retention period provided in the preceding Paragraph, 

Alcoa shall notify EPA at least ninety (90) days prior to the destruction of any records or 

documents subject to the requirements of the preceding Paragraph, and, upon request by 

EPA, Alcoa shall deliver any such records or documents to EPA. Alcoa may assert that 

certain documents, records, or other information are privileged under the attorney-client 

privilege or any other privilege recognized by federal law. If Alcoa asserts such a privilege, 

it shall provide the following: (a) the title of the document, record, or information; (b) the 

date of the document, record, or information; (c) the name and title of the author of the 

document, record, or information; (d) the name and title of each addressee and recipient; (e) 

a description of the subject of the document, record, or information; and (f) the privilege 

asserted by Alcoa. No documents, reports, or other information created or generated 

pursuant to the requirements of this Consent Decree, however, shall be withheld on the 

grounds that they are privileged. 

151. Public Documents. All information and documents submitted by Alcoa to the United States 

pursuant to this Consent Decree shall be publicly available unless subject to legal privileges 

51
or protection or identified and supported as business confidential by Alcoa in compliance 

with 40 C.F.R. Part 2. 

152. Nothing in this Consent Decree shall limit the authority of EPA to conduct tests and 

inspections at Alcoa’s facilities under Section 114 of the Act, 42 U.S.C. § 7414, or any other 

applicable federal or state laws, regulations, or permits. 

XVIII. NOTICES 

153. Notices. Unless otherwise provided herein, whenever notifications, submissions, or 

communications are required by this Consent Decree, they shall be made in writing and 

addressed as follows: 

As to the United States of America: 

Chief 

Environmental Enforcement Section 

Environment and Natural Resources Division 

U.S. Department of Justice 

P.O. Box 7611, Ben Franklin Station 

Washington, D.C. 20044-7611

DJ# 90-5-2-1-07723

and 

Director, Compliance Assurance and Enforcement Division

U.S. EPA Region 6

1445 Ross Avenue, Suite 1200

Dallas, TX 75202

As to the Citizen Groups 

Regional Director 

Environmental Defense 

44 East Avenue 

Austin, TX 78701 

52
(Alcoa agrees to send e-mail notification of these submissions to counsel for Citizen 

Groups: rzars@lariat.org for Reed Zars and georgehays@mindspring.com for George Hays. 

No stipulated penalties shall apply to this obligation.) 

As to TCEQ: 

Director, Field Operations Division

P.O. Box 13087, MC-174

Austin, TX 78711-3087

As to Alcoa: 

Environmental Superintendent

Alcoa Inc. 

Rockdale Operations 

Off Route 79, FM 1786

P.O. Box 1231

Rockdale, Texas 76567-1231

154. Notwithstanding any other provision of this Consent Decree, Alcoa shall supply to TCEQ a 

copy of all notices, reports, applications, elections, and any other written statement that the 

Consent Decree requires Alcoa to supply to any Plaintiff. Such copies shall be sent to the 

address noted in Paragraph 153, above. 

155. Notifications, communications, and submissions submitted pursuant to this Section shall be 

deemed submitted on the date they are postmarked and sent either by overnight mail, return 

receipt requested, or by certified or registered mail, return receipt requested, unless 

otherwise provided by mutual agreement of the Parties in writing. 

156. Any Party may change either the notice recipient or the address for providing notices to it 

by serving all other Parties with a notice setting forth such new notice recipient or address. 

53
XIX. SALES OR TRANSFERS OF OWNERSHIP INTERESTS 

157. If Alcoa proposes to sell or transfer part or all of its ownership interest in any of the Existing 

Sandow Units or Replacement Sandow Units (“Ownership Interest”), it shall advise the 

purchaser or transferee in writing of the existence of this Consent Decree prior to such sale 

or transfer, and shall send a copy of such written notification to the Plaintiffs pursuant to 

Section XVIII (Notices) at least sixty (60) days before such proposed sale or transfer. 

Plaintiffs shall maintain the confidentiality of any information in such notice that is 

identified and supported by Alcoa as business confidential in compliance with 40 C.F.R. 

Part 2. 

158. No sale or transfer of an Ownership Interest shall take place before the purchaser or 

transferee and the United States has executed, and the Court has approved, a modification 

pursuant to Section XX (Modification) of this Consent Decree making the purchaser or 

transferee a party defendant to this Consent Decree and jointly and severally liable with 

Alcoa for all the requirements of this Consent Decree that may be applicable to the 

transferred or purchased Ownership Interests, including joint and several liability with 

Alcoa for all requirements specific to the Existing Sandow Units and the Replacement 

Sandow Units, as well as all requirements in this Consent Decree that are not specific to 

these Units. 

159. This Consent Decree shall not be construed to impede the transfer of any Ownership 

Interests between Alcoa and any purchaser or transferee as long the requirements of this 

Consent Decree are met. The Citizen Groups expressly waive and hereby consent to any 

transfer of any Ownership Interests between Alcoa and any purchaser or transferee agreed to 

54
by the United States under the provisions of this Section. This Consent Decree shall not be 

construed to prohibit a contractual allocation – as between Alcoa and any purchaser or 

transferee of Ownership Interests – of the burdens of compliance with this Consent Decree, 

provided that both Alcoa and such purchaser or transferee shall remain jointly and severally 

liable to the Plaintiffs for the obligations of this Consent Decree applicable to the transferred 

or purchased Ownership Interests. 

160. If the United States agrees, the United States, Alcoa, and a purchaser or transferee that has 

become a party defendant to this Consent Decree pursuant to Paragraph 158, above, may 

execute a modification that relieves Alcoa of its liability under this Consent Decree for, and 

makes the purchaser or transferee liable for, all obligations and liabilities applicable to the 

purchased or transferred Ownership Interests. Notwithstanding the foregoing, however, 

Alcoa may not assign, and may not be released from, any obligation under this Consent 

Decree that is not specific to the purchased or transferred Ownership Interests, including the 

obligations set forth in Sections XI (Environmental Mitigation Projects) and XIII (Civil 

Penalty). Alcoa may propose and the United States may agree to restrict the scope of joint 

and several liability of any purchaser or transferee for any obligations of this Consent 

Decree that are not specific to the Existing or Replacement Sandow Units, to the extent such 

obligations may be adequately separated in an enforceable manner. 

XX. MODIFICATION 

161. Except as provided in Section XIX (Sales or Transfers of Ownership Interests), this Consent 

Decree may be modified only by a subsequent written agreement signed by all the Parties 

and approved by the Court. 

55
XXI. ENFORCEMENT THROUGH TITLE V PERMIT 

162. Once Alcoa has demonstrated that: (a) all requirements of the Consent Decree have been 

satisfied, including but not limited to either (i) all of the Existing Sandow Units achieved 

and maintained compliance with the emission limitations set forth in Paragraphs 52, 55, and 

58 of this Consent Decree for at least 24 consecutive months, (ii) all of the Replacement 

Sandow Units achieved and maintained compliance with the emissions limitations set forth 

in Paragraphs 60, 62, and 63 for at least 24 consecutive months, or (iii) the Existing Sandow 

Units have been permanently shut down, in accordance with Paragraphs 68 of this Consent 

Decree; and (b) that the requirements of this Consent Decree have been incorporated into 

Alcoa’s Title V operating permit for the Rockdale facility pursuant to Paragraphs 93 and 94 

of this Consent Decree, then Alcoa shall so certify these facts to the Plaintiffs and to this 

Court. If Alcoa is in compliance with all the requirements set forth above, Alcoa may 

request that Plaintiffs join with it to seek a shorter time from the court by which such 

certification can be made. 

a. If the Plaintiffs do not object in writing with specific reasons within sixty (60) days 

of receipt of Alcoa’s certification, or request additional information from Alcoa, 

then, for any violations that occur after the filing of certification, Plaintiffs shall 

pursue enforcement of the requirements contained in the Title V permit through only 

the applicable Title V permit, and not this Consent Decree. 

b. In the event that some aspect of the Title V permit does not allow for enforcement of 

a requirement found in this Consent Decree, however, or if a Consent Decree 

requirement was intended to be part of the Title V permit and did not become or 

56
remain part of such permit, then the United States, or the Citizen Plaintiffs jointly 

with the United States, may enforce such requirement under this Consent Decree. 

c. If the Plaintiffs object in writing to Alcoa’s certification, then the matter shall be 

submitted to this Court for resolution under Section XVI (Dispute Resolution) of this 

Consent Decree. In such case, Alcoa shall bear the burden of proving that it has 

complied with the requirements referenced in this Paragraph. 

XXII. TERMINATION 

163. No later than sixty (60) days after commencement of operation of each pollution control 

device in Subsections IV(B), IV(C), and IV(F) (Pollution Controls and Reductions) of this 

Consent Decree, Alcoa shall submit to TCEQ a request for a source-specific revision to the 

Texas SIP to reflect the emission limitations and emissions monitoring requirements for 

each Sandow Unit as set forth in this Consent Decree. Notwithstanding any other provision 

of this Consent Decree, this Consent Decree may be terminated upon motion of a Party and 

further Order of this Court upon (1) the incorporation of the emission limitations and 

emissions monitoring requirements of this Consent Decree into the Texas SIP, and (2) 

Alcoa’s demonstration of continuous compliance with these emission limitations and 

emissions monitoring requirements for a period of at least 24 months. 

XXIII. GENERAL PROVISIONS 

164. This Consent Decree is not a permit. Compliance with its terms does not guarantee 

compliance with all applicable Federal, State or local laws or regulations. 

165. Nothing in this Consent Decree shall preclude the Citizen Groups, or any member or 

representative thereof, from providing comment or otherwise participating in any public, 

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administrative, legislative, regulatory or judicial forum pertaining to Alcoa’s Rockdale 

operations on any subject that is open to comment or participation by any appropriate 

member of the public not a party to this Consent Decree; provided, however, that the Citizen 

Groups shall not challenge or oppose the TCEQ’s issuance of the Voluntary Emission 

Reduction Permit (TCEQ Permit No. 48437), the BACT analysis for the Permit 

Amendment, or the issuance of Permit Amendment under the State Permitting Process if the 

Permit Amendment includes emissions limitations at least as stringent as those specified in 

Paragraph 63. The Citizen Groups further agree to not challenge or oppose TCEQ’s 

permitting of the facilities ancillary to the Replacement Sandow Units, with the exception of 

any permits related to the lignite mines, ancillary mining equipment, or conveyors from the 

mines to the Rockdale power plant facility. 

166. This Consent Decree does not apply to any claim(s) of alleged criminal liability. 

167. In any subsequent administrative or judicial action initiated by any Plaintiff for injunctive 

relief or civil penalties relating to the facilities covered by this Consent Decree, Alcoa shall 

not assert any defense or claim based upon principles of waiver, res judicata, collateral 

estoppel, issue preclusion, claim preclusion, claim splitting, or other defense based upon any 

contention that the claims raised by that Plaintiff in the subsequent proceeding were 

brought, or should have been brought, in the instant cases; provided, however, that nothing 

in this Paragraph is intended to affect the enforceability of the Resolution of Future Civil 

Claims provisions in Section IX of this Consent Decree. 

168. Other Laws. Except as specifically provided by this Consent Decree, nothing in this Consent 

Decree shall relieve Alcoa of its obligation to comply with all applicable Federal, State, and 

58
Local laws and regulations. Subject to the resolution of claims in Paragraphs 96 and 97, 

nothing contained in this Consent Decree shall be construed to prevent or limit any 

Plaintiff’s rights to obtain penalties or injunctive relief under the Act or other federal or 

state statutes, regulations, or permits. 

169. Except as expressly provided otherwise by this Consent Decree, provisions of law expressly 

cited in this Consent Decree shall be construed to mean the provision as it exists on the date 

of entry of this Consent Decree. 

170. Third Parties. This Consent Decree does not limit, enlarge or affect the rights of any Party 

to this Consent Decree as against any third parties. 

171. Complete Agreement. This Consent Decree constitutes the final, complete and exclusive 

agreement and understanding between the Parties with respect to the settlement embodied in 

this Consent Decree, and supercedes all prior agreements and understandings among the 

Parties related to the subject matter herein. No document, representation, inducement, 

agreement, understanding, or promise, constitutes any part of this Consent Decree or the 

settlement it represents, nor shall they be used in construing the terms of this Consent 

Decree. 

172. Effective Date. The Effective Date of this Consent Decree shall be the date upon which this 

Consent Decree is entered by the Court. 

173. Public Notice and Comment. The Parties agree and acknowledge that final approval by 

United States and entry of this Consent Decree is subject to the procedures of 28 C.F.R. 

§ 50.7, which provides for notice of the lodging of this Consent Decree in the Federal 

Register, an opportunity for public comment, and the right of the United States to withdraw 

59
or withhold consent if the comments disclose facts or considerations that indicate that the 

Consent Decree is inappropriate, improper, or inadequate. 

174. Alcoa’s Waiver of Objection to Entry. Alcoa agrees not to oppose entry of this Consent 

Decree by this Court or to challenge any provision of this Consent Decree unless the United 

States has notified the Alcoa in writing that the United States no longer supports entry of the 

Consent Decree. 

XXIV. SIGNATORIES AND SERVICE 

175. Each undersigned representative of Alcoa certifies that he or she is fully authorized to enter 

into the terms and conditions of this Consent Decree and to execute and legally bind Alcoa 

to this document. 

176. This Consent Decree may be signed in counterparts, and such counterpart signature pages 

shall be given full force and effect. 

177. Alcoa hereby agrees to accept service of process by mail with respect to all matters arising 

under or relating to this Consent Decree and to waive the formal service requirements set 

forth in Rule 4 of the Federal Rules of Civil Procedure and any applicable Local Rules of 

this Court including, but not limited to, service of a summons. 

XXV. FINAL JUDGMENT 

178. Upon approval and entry of this Consent Decree by the Court, this Consent Decree shall 

constitute a final judgment between the United States, the Citizen Groups, and Alcoa. 

SO ORDERED, THIS _________ DAY OF _______________, 2003. 

UNITED STATES DISTRICT COURT JUDGE 

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Signature Page for Consent Decree in United States v. Alcoa, Inc. (W.D. TX) 

FOR THE UNITED STATES OF AMERICA: 

THOMAS J. SANSONETTI

Assistant Attorney General

Environmental and Natural Resources Division

United States Department of Justice

MATTHEW W. MORRISON

Senior Counsel

Environmental Enforcement Section

Environmental and Natural Resources Division

United States Department of Justice

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Signature Page for Consent Decree in United States v. Alcoa, Inc. (W.D. TX) 

JOHN PETER SUAREZ

Assistant Administrator

Office of Enforcement and Compliance Assurance

United States Environmental Protection Agency

BRUCE C. BUCKHEIT

Director, Air Enforcement Division

Office of Enforcement and Compliance Assurance

United States Environmental Protection Agency

RICHARD ALONSO

Attorney Advisor

Air Enforcement Division

Office of Enforcement and Compliance Assurance

United States Environmental Protection Agency

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Signature Page for Consent Decree in United States v. Alcoa, Inc. (W.D. TX) 

LAWRENCE STARFIELD

Regional Administrator

Region 6

United States Environmental Protection Agency

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Signature Page for Consent Decree in United States v. Alcoa, Inc. (W.D. TX) 

FOR NEIGHBORS FOR NEIGHBORS, INC. 

Billie Woods

President, Neighbors for Neighbors, Inc.

P.O. Box 661

Elgin, Texas 78621

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Signature Page for Consent Decree in United States v. Alcoa, Inc. (W.D. TX) 

FOR ENVIRONMENTAL DEFENSE 

James D. Marston 

Director, Texas Office 

Environmental Defense 

44 East Avenue 

Austin, Texas 78701 

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Signature Page for Consent Decree in United States v. Alcoa, Inc. (W.D. TX) 

FOR PUBLIC CITIZEN, INC. 

Thomas “Smitty” Smith

Director, Public Citizen’s Texas Office

1002 West Avenue

Austin, Texas 78701

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Signature Page for Consent Decree in United States v. Alcoa, Inc. (W.D. TX) 

FOR ALCOA INC. 

Bernt Reitan

Vice President

Alcoa Inc.

President, Primary Metals

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