BEFORE THE

DEPARTMENT OF NATURAL RESOURCES

Notice of Public Hearing

Proposed Redesignation to Attainment for the 2006 24-Hour Fine Particulate (PMz.s) National

Ambient Air Quality Standard (NAAQS) for the Counties of Milwaukee,

. Racine, and Waukesha

NOTICE IS HEREBY GIVEN that pursuant toss. 285.11(5) and (6) and 285.23(2) and (4), Wi s. Stats., and ch. NR 401, Wis. Adm. Code, the Department of Natural Resources will hold a public hearing

on its proposal to re designate the counties of Milwaukee, Racine, and Wauke s ha from nonattainment to

attainment for the 2006 24-hour PM 25 NAAQS.

Background

Under the federal Clean Air Act (CAA), the U.S. Environmental Protection Agency (EPA) is required to identify areas that do not meet the NAAQS for PM 2 .s. The counties of Milwaukee, Racine, and

Waukesha were de s ignat e d nonattainment on November 13, 2009 by the U.S. EPA (74 FR 58688)

. The
Department has drafted a request to the U.S. EPA that th ey r edes ignat e the se counties from nonattainment

to attainment ba se d on monitoring data

. collected during 2008- 20 10.

NOTICE IS HEREBY FURTHER GIVEN that the public h ea ring will be held on:

Monday, May 7, 2012 at 1:00 p.m.

WI DNR Southeast R eg ion Headquarter s, Room 1 40- 141

2300 N

. Dr. Martin Luther King Jr. Drive

Milwaukee, WI

NOTICE IS HEREBY FURTHER GIVEN that pur s uant t o the Americans with Di sa bilities Act

, reasonable accommodations

, including the provision of informational mat e rial in an alternative format,

will be provided for qualified individual s with di sa bilitie s upon request. Please call Mr. Joseph Hoch at (608) 267-7543 with specific information on yo ur reque st at le ast 10 day s b e for e the date of the scheduled

h ea ring

.

Written Comments and Copies of Documents

Written comments on the draft PM 2

. 5 redesignation request ma y b e s ubmitted to Mr. Joseph Ho c h

, Bureau

of Air Management AM/7, P.O. Bo x 7921, Madison, WI 53707 no later than May 11,2012

. Comments

may also be s ubmitted electronica ll y to j osep h.h oc h @w i sconsin.gov. Written comments will have the

sa m e weight and ef f ec t as oral s tat eme nt s presented at th e h ea rin g

.

The draft PM 2

. 5 rede s i g nation request may be downlo a d e d from http://dnr

. wi.gov/topic/AirOuality or a hard copy may be obtained by contacting**sep h**  Hoch at (608) 267-7543.

Dated at Madison

, Wisconsin

# & 

# / ,<::P /**~**

### May 9, 2012

Submitted Electronically

Mr. Joe Hoch DNR Bureau of Air Management Wisconsin Department of Natural Resources

P.O. Box 7921 Madison, WI 53707

RE: Comments on DNR’s Proposed Redesignation Request and Maintenance Plan for the 24- hour Fine Particulate Matter National Ambient Air Quality Standard

Dear Mr. Hoch:

Wisconsin Electric Power Company, doing business as We Energies, submits these comments in response to the Wisconsin Department of Natural Resources (“WDNR” or the “Department”) Proposed Redesignation Request and Maintenance Plan for the 24-hour Fine Particulate Matter National Ambient Air Quality Standard (“Redesignation Request”). WDNR’s Redesignation Request proposes to redesignate Milwaukee, Racine, and Waukesha counties as attainment areas meeting the 24-hour Fine Particulate Matter National Ambient Air Quality Standard (PM 2.5 

### NAAQS).

We Energies is an investor-owned electric and gas utility that serves more than 1.1 million electric customers in Wisconsin and Michigan’s Upper Peninsula and more than 1 million natural gas customers in Wisconsin. We Energies owns and operates coal-fueled power plants that are located in the counties that are proposed for redesignation. These include the Milwaukee County Power Plant, the Valley Power Plant, and all generation units at the Oak Creek Site, including the South Oak Creek and Oak Creek Expansion units. Future construction permitting activities at any of these facilities will be impacted by a change in designation status related to the PM 2.5 

### NAAQS.

We are aware of the benefits that may be available to our affected generation units, our customers, and new business development and growth in southeast Wisconsin if the 3-county area is redesignated as an attainment area. We understand that a successful designation effort will replace the need for WDNR to prepare and submit a State Implementation Plan (SIP) revision, which would necessarily contain an attainment demonstration, additional emissions control measures, and other requirements. In addition, the requirement to obtain emission offsets and to employ LowestWe Energies Comments on WDNR Proposed Redesignation Request Related to PM 2.5 NAAQS

May 9, 2012 Page 2



### Available Emission Rate technologies as part of major source construction permitting would no longer apply.

While these are all tangible benefits associated with redesignation, there is also a need to resolve potential associated permitting complexities. Specifically, there is a need to address key technical issues having to do with regional air pollutants like PM 2.5 

### , including the background PM 2.5 

### concentrations that must be used during construction permitting and permit modeling. An advance effort to manage these related permitting implications will allow southeast Wisconsin to benefit fully from the proposed redesignation.

Despite the uncertain impacts on construction permitting, WDNR’s proposal to the United States Environmental Protection Agency (U.S.EPA) to redesignate the three counties in southeast Wisconsin is generally a positive action because it reflects real improvements in air quality. Separately, U.S.EPA has published a notice that they are proposing to determine that the

Milwaukee-Racine area has attained the 2006 PM 2.5 

### NAAQS requirements based on certified monitoring data from the 2008-2010 period. These actions are indicative that air quality is improving.



## Air Quality Improvements

We Energies investment in emission controls and other clean air initiatives has been a contributing factor to improved air quality in southeast Wisconsin. When construction of the latest air quality control project is completed at the end of this year, the company will have reduced emissions of sulfur dioxides (SO 2 

### ) and nitrogen oxides (NO

x 

### ) by approximately 90% and 75%, respectively, from our electric generating facilities in southeast Wisconsin since 2000. See figure 1, below.

Figure 1:We Energies Comments on WDNR Proposed Redesignation Request Related to PM 2.5 NAAQS

May 9, 2012 Page 3



## Comments on DNR’s Proposed Redesignation Request and Maintenance Plan

We have reviewed the proposed Redesignation Request prepared by WDNR, and the supporting analysis in Appendix 3 - An Analysis of Characteristics and Precursors to Ambient PM 2.5 

### Levels in Southeastern Wisconsin for Purposes of Designing Emission Inventories for Inclusion in a Request for Redesignation to Attainment for PM 2.5 

### Nonattainment Counties of Milwaukee, Waukesha and

Racine , Appendix 4: 2006 and 2010 Point Source Emission Calculations, and Appendix 7: 2020

and 2025 Point Source Emission Calculations. We have two areas of comment to provide on these

draft documents.

The first comment is related to the relevance of a recently published study done jointly by the Lake Michigan Air Directors Consortium (LADCO), the Electric Power Research Institute (EPRI), and

other contributors 1 

### . This study includes an analysis of wintertime episodes of PM 2.5 

### concentrations, and subsequent scenario analyses of reductions in precursor emissions that contribute to monitored

levels of PM 2.5 

### . Our second comment pertains to the point source emission inventories and projected calculations for We Energies facilities that DNR has used in its Redesignation Request.

I. References to the Lake Michigan Air Directors Consortium and Electric Power Research Institute Winter Nitrate Study

As stated in its introduction, the purpose of Appendix 3 to WDNR’s proposed Redesignation Request is to provide a technical demonstration to identify certain long-term characteristics, distribution and profiles in measured fine particulates and some of their precursors in southeast Wisconsin. We request that this Appendix be modified to reference a recently completed study that adds to the technical knowledge of the attributes of PM 2.5 

### and PM 2.5 

### episodes in southeast

Wisconsin.

A collaborative study involving LADCO, EPRI, and other contributors was initiated in 2008 to collect ambient PM data in Wisconsin and investigate the source of high PM 2.5 

### episodes in the upper Midwest during winter. Historically, these episodes contributed to nonattainment of the

PM 2.5 

### NAAQS. While these exceedences featured high levels of ammonium and nitrate particulates, the processes that explain when and how these episodes occur, and the relative role of nitric acid and ammonia was not well understood. The study sought to develop an improved conceptual model to describe the nitrate component with respect to, among other things, the influence of meteorological conditions and contributions from different emissions sources, as well as insights into potential refinements to reactive nitrogen chemistry represented in air quality models. The study was conducted using monitoring data at two sites in Wisconsin, an urban site in Milwaukee and an upwind rural site in Mayville.

A midpoint report on the study (the data analysis phase) was issued in October 2010, and can be found on LADCO’s website, http://www.ladco.org/ . The manuscript for this phase of the study was submitted on April 4, 2012 to Atmospheric Chemistry and Physics Discussions Journal for peer

1 Other contributors to the “LADCO Winter Nitrate Study” include Atmospheric Research and Analysis (ARA), the Illinois State Water Survey, the University of Illinois, the University of Iowa, and the Wisconsin Department of Natural

Resources.We Energies Comments on WDNR Proposed Redesignation Request Related to PM 2.5 NAAQS

May 9, 2012 Page 4



### review, http://www.atmos-chem-phys-discuss.net/papers_in_open_discussion.html and should appear on this site shortly. A report on the second phase of the study (the modeling phase) has recently been completed and should be available on LADCO’s website in the near future. The manuscript for this phase of the study will also be submitted for peer review.

There are a number of policy-relevant findings contained in this comprehensive study. Of particular interest to the Redesignation Request is the study’s finding that reductions in ammonia emissions

result in lower modeled PM 2.5 

### levels, and that ammonia emissions reductions have a greater impact

on PM 2.5 

### concentrations than NO

x 

### emissions reductions. The study leads to an increased technical understanding of the chemistry of PM 2.5 

### in the upper Midwest, and was able to demonstrate generally good agreement between modeled and measured PM 2.5 

### concentrations and characteristics. Overall the study is important to support air quality management activities related to managing

PM 2.5 

### levels.

Given the importance of the study’s findings, we suggest that a description of the study and the study findings be added to Appendix C, Section 6 – Evaluating characteristics of PM 2.5 

### in

Milwaukee and Waukesha Counties.

In addition, it is relevant to include ammonia reduction emission strategies in the Maintenance Plan in Section 7.0 of the Redesignation Request, specifically as a line item in Section 7.5 List of

Potential Additional Control Measures.

II. Comments on Emission Inventory Data Related to We Energies Facilities

We attempted to review the emissions data for the We Energies facilities that were included in DNR’s underlying analysis. This includes point source data for direct PM 2.5 

### , NO

x 

### , SO 2 

### and VOCs for We Energies facilities in the counties of Milwaukee, Racine, and Waukesha.

These data were summarized in Section 4.4 Base Year Inventory (Nonattainment Year Inventory) of the Redesignation Request

, and by facility id (FID) number in Appendix 4. We also reviewed

Section 7.1 Maintenance Inventory Methodology (2020 and 2025) of the Redesignation Request, which contains the projected emission inventories for 2020 and 2025, and the Electric Generating Unit (EGU) 2020 and 2025 point source emissions calculations in Appendix 7. Overall, a quick review of the data related to We Energies facilities looks realistic.



## Future Permitting Challenges

As noted in our opening paragraphs, we generally view redesignation to attainment as a positive action and appreciate DNR’s initiative to proceed with the Redesignation Request. We recognize that the next steps in the process will involve the state working with U.S.EPA as they evaluate and act on the redesignation submittal. We would also like to identify some additional activities that we believe will be valuable as part of transitioning from the construction permitting requirementsWe Energies Comments on WDNR Proposed Redesignation Request Related to PM 2.5 NAAQS

May 9, 2012 Page 5



### currently applicable in nonattainment areas, to different requirements that will apply in attainment

areas.

The Clean Air Act includes a permitting framework for prevention of significant deterioration of air quality (“PSD”) in areas designated as in attainment with a NAAQS. WDNR implements this portion of the CAA and carries out the preconstruction permitting of all new or modified major emitting facilities. As part of this process, those wishing to build or modify major emitting facilities must undertake an air quality impact analysis to demonstrate that emissions from the proposed

source will not cause or contribute to an exceedence of the PM 2.5 

### NAAQS. In addition, the PSD regulations call for each permit applicant to conduct a broader source impact analysis to demonstrate that allowable emission increases from the proposed source or modification, combined with emissions from other nearby sources and representative background levels of PM 2.5 

### , would not cause or contribute to violations of any NAAQS.

Our primary interest going forward is related to the technical details of this required cumulative impact analysis. These details pertain to the geographic location, extent of existing sources, higher emission inventory, and increased population density in the three-county area. While the Department already has experience with construction permitting in attainment areas in other parts of the state, we expect that there will be some additional modeling and permitting complications in the urban area being proposed for redesignation.

The company has been involved in modeling PM 2.5 

### for past permitting actions. Based on this experience, additional investigation into the applicable PM 2.5 

### background levels to be used in the counties being proposed for redesignation is needed. In particular, it is unclear how a PSD permit could be issued for new or modified sources in attainment areas where area monitors are showing

levels of PM 2.5 

### that are very close to the PM 2.5 

### NAAQS. Therefore, the monitoring data used to develop applicable PM 2.5 

### background levels will be a critical part of future PSD permitting in the redesignated counties.

Other technical issues that appear to need more review and potential refinement are related to the regional nature of PM 2.5 

### . Secondary formation of PM 2.5 

### from emissions of ammonia, NO

x 

### , SO 2 

### , and other compounds from across the region often contribute significantly to total ambient levels of

PM 2.5 

### , and therefore must also be accounted for in cumulative modeling exercises. The use of dispersion models as related to the relatively new PM 2.5 

### NAAQS is continuing to be evaluated and refined. The modeling challenges related to PM 2.5 

### are well known to the states, regulated sources,

and U.S.EPA.

Consequently, implementation of the PM 2.5 

### NAAQS is still being developed and revised by U.S.EPA. The agency has recently indicated that they are planning to issue draft PM 2.5 

### Modeling Guidance in the near future for review and comment. This action has been anticipated for some time, but has been delayed. U.S.EPA first sought collaborative input from states and other parties in developing draft PM 2.5 

### Modeling Guidance, and now plans to publish this draft for additional public comment. We encourage the Department to participate in the upcoming review of EPA’s

draft PM 2.5 

### Modeling Guidance, and provide comment on provisions that would or could affect future PSD permitting actions in the urban areas proposed for redesignation.We Energies Comments on WDNR Proposed Redesignation Request Related to PM 2.5 NAAQS

May 9, 2012 Page 6



### In conclusion, a successful redesignation effort will recognize the underlying improvements in air quality in southeastern Wisconsin, but unless there is a well-defined PSD permitting process in place that allows for preconstruction permitting of new or modified sources in these redesignated areas, then, ironically, there could be impediments to the desired economic growth in this part of the state that should be anticipated as a result of redesignation.

Once again, We Energies appreciates the effort that the Department has put into developing this Redesignation Request and the opportunity to comment on it. If you should have any questions or require further information regarding these comments, please contact Kathleen Standen, Manager Environmental Regulatory, by telephone at 608-283-3009, or by e-mail at kathleen.standen@we-energies.com.

Sincerely,

Bruce W. Ramme

Vice President Environmental

Copy: Pat Stevens, Administrator – Air & Waste Division, WDNR Bart Sponseller, Director – Bureau if Air Management, WDNR

### Hoch, Joseph A - DNR

From: Hiebert, Christopher T. [CHIEBERT@SEWRPC.org]

Sent: Wednesday, May 30, 2012 7:43 AM

To: Hoch, Joseph A - DNR

Cc: Yunker, Kenneth R.; Hoel, Ryan W.; Trainer, Pa tricia - DOT; Glaze, John - DOT; Dwight McComb (dwight.mccomb@fhwa.dot.gov); Friedlander, Michael - DNR

Subject: SEWRPC comments regarding the sufficiency of the emission budgets included in the PM2.5 redesignation request

Follow Up Flag: Follow up

Flag Status: Blue 

### Page 1 of 2

06/05/2012 Dear Mr. Hoch,

The Southeastern Wisconsin Regional Planning Commission has completed its review of the Wisconsin
Department of Natural Resources’ (WDNR) April 2012 draft document Proposed Redesignation Request and

Maintenance Plan for the 24

‐ Hour Fine Particulate Matter National Ambient Air Quality Standard for the

Milwaukee

‐ Racine 3

‐ County Nonattainment Area

. This update included new nitrogen oxide (NOx), fine
particulate (PM2.5), sulfur dioxide (SO2), and volatile organic compound (VOC) emission budgets for the years

2020 and 2025 based on the new emission model (MOVES) promulgated by the U.S. Environmental Protection
Agency (U.S. EPA) on March 2, 2010. At the time the update to the emission inventory and emission budgets was initiated, U.S. EPA required that this update be conducted using MOVES, as the two

‐ year grace period to use the

MOVES model was nearing its end (March 2, 2012). The grace period to implement MOVES has subsequently

been extended an additional year.

This is the second time in Wisconsin that the MOVES model has been applied by the WDNR to develop mobile

source emission budgets, and the first time mobile source emission budgets have been developed to for the 24

‐ hour fine particulate matter national ambient air quality standard (NAAQS). The emission budgets proposed by

WDNR were estimated based on data from previous emission analyses, including data interpolated from years
other than 2020 and 2025. The proposed emission budgets include a 7.5 percent safety margin necessary to

account for future uncertainties based on changing economic conditions and potential new U.S. EPA required

emission models.

To make a determination as to the sufficiency of the safety margin included in the proposed mobile source

emission budgets, the Commission developed a set of high economic growth emission estimates for the years

2020 and 2025, using both the Commission’s travel demand model and the MOVES emission model, and
compared those estimates to the proposed emission budgets included in the redesignation request.

Commission staff worked closely with WDNR staff in this effort. The results of this analysis indicated that the
proposed mobile source emission budgets (32.62 tons per winter day in the year 2020 and 28.69 tons per winter day in the year 2025 for NOx, 2.33 tons per winter day in the year 2020 and 2.16 tons per winter day in the year

2025 for PM2.5, 0.39 tons per winter day in the year 2020 and 0.38 tons per winter day in the year 2025 for SO2,

and 15.89 tons per winter day in the year 2020 and 11.98 tons per winter day in the year 2025 for VOC’s)

included in the draft April 2012 Proposed Redesignation Request and Maintenance Plan for the 24

‐ Hour Fine

Particulate Matter National Ambient Air Quality Standard for the Milwaukee

‐ Racine 3

‐ County Nonattainment

A rea do provide a 7.5 percent safety margin as indicated in the draft document.

We appreciate the expertise and effort that the WDNR has exercised in conducting the analyses and

documentation necessary to demonstrate attainment of, and to make a redesignation request to the U.S. EPA

from nonattainment to attainment of, 24

‐ hour fine particulate matter national ambient air quality standard forthe 3

‐ county Southeastern Wisconsin 24

‐ hour fine particulate matter nonattainment area.

Sincerely,

Christopher T. Hiebert, P.E.

Chief Transportation Engineer

Southeastern Wisconsin Regional Planning Commission

W239 N1812 Rockwood Drive

P.O. Box 1607
Waukesha, WI 53187

‐ 1607

Phone: (262)547

‐ 6722 x 227

Fax: (262)547

‐ 1103 chiebert@sewrpc.org 

### Page 2 of 2

06/05/2012Fine Particulate Matter (PM2.5) Redesignation RequestResponse to CommentsComment # Commenter Date ofComment Comment Response1We Energies May 9, 2012Despite the uncertain impacts on constructionpermitting, WDNR’s proposal to the UnitedStates Environmental Protection Agency(U.S.EPA) to redesignate the three counties insoutheast Wisconsin is generally a positiveaction because it reflects real improvements inair quality.No response necessary.2We Energies May 9, 2012Of particular interest to the RedesignationRequest is the study’s finding (LADCO WinterNitrate Study) that reductions in ammoniaemissions result in lower modeled PM2.5levels,and that ammonia emissions reductions have agreater impact on PM2.5concentrations than NOxemissions reductions.Given the importance of the study’s findings, wesuggest that a description of the study and thestudy findings be added to Appendix C, Section6 – Evaluating characteristics of PM2.5inMilwaukee and Waukesha Counties.In addition, it is relevant to include ammoniareduction emission strategies in the MaintenancePlan in Section 7.0 of the RedesignationRequest, specifically as a line item in Section7.5 List of Potential Additional ControlMeasures.Appendix 3 has been modified to include adiscussion of the impacts of ammonia (NH3) asa PM2.5precursor. In addition, consideration ofNH3emission reductions has been added to thelist of potential additional control measures(Section 7.5) of the redesignation requestdocument.3We Energies May 9, 2012Overall, a quick review of the data (emissionsinventory) related to We Energies facilities looksrealisticNo response necessary.Comment # Commenter Date ofComment Comment Response4We Energies May 9, 2012The company has been involved in modelingPM2.5for past permitting actions. Based on thisexperience, additional investigation into theapplicable PM2.5background levels to be used inthe counties being proposed for redesignation isneeded. In particular,it is unclear how a PSDpermit could be issued for new or modifiedsources in attainment areas where area monitorsare showing levels of PM2.5that are very close tothe PM2.5NAAQS.The WDNR currently uses a “high” and “low”approach for PM2.5background values based ondata from 2001 – 2006. Regardless of how“close” current levels are does not affectWDNR’s approach to determining backgroundconcentrations.5SEWRPC May 30, 2012The proposed motor vehicle emissions budgets(MVEBs) do in fact provide a 7.5 percent safetymargin as indicated.No response necessary.CommentersWe Energies – Wisconsin Electric Power Company (i.e., We Energies)SEWRPC – Southeastern Wisconsin Regional Planning Commission