UNITED STATES ENVIRONMENTAL PROTECTION AGENCY REGION IX 75 Hawthorne Street San Francisco, CA 94105

July 18,2011
Mr. George L. Piantka, P.E. NRG Energy Inc.

- WestRegion 5790 Fleet Street, Suite 200 Carlsbad, California 92008 

### Subject: New PSDApplicabilityDeterminationAnalysis for the Carlsbad Energy CenterPower Project
DearMr. Piantka:
This letteris to inform you that the United Stated Environmental Protection Agency (EPA) is withdrawing as moot the Prevention ofSignificant Deterioration (PSD) applicability determination for the Carlsbad Energy Center Project (CECP) previously issued on October 13, 2010and January 11, 2011. Theanalysis contained in that applicability determination was based on a projected actual construction date ofJune 30, 2011, and clearly stated that if"theproject has not begun construction by this time, a new [applicability] analysis and determination will be required." See PSD Applicability Analysis for the Carlsbad Energy Center Project at 2. In this case, the California Energy Commission did not issue the necessary approvals that would allow NRG to start construction byJune 30, 2011, so NRG did not have authority to begin actual construction on the CECP by that date. Accordingly, the prior applicability determination is no longer valid. In withdrawing this PSD applicability determination as moot, we also note that we have concluded that the analysis contained in it was made in error. As such, neither the overall determination nor the rationale and analysis contained therein can be relied upon to undertake actions related to the CECP or any other facility. In revoking this particular analysis, EPA emphasizes that there still may be specific permitting circumstances in which EPAmay use the discretion provided by40CFR §52.21 (b)(48)(i) to select a different period for determining the baseline actual emissions, but the use ofsuchdiscretion will be based on the particular facts ofthe permitting situation under consideration. I

I EPAalso notes that the discretion to consider a different period for calculating baseline actual emissions for determining PSD applicabilityis limited to applicability determinations performed by the Agency and other approved permitting authorities and may not be invoked independently by emission sources and/orpermit applicants. See 40CFR §52.21 (b)(48)(i) (limiting use ofa different time period to theAdministrator's determination "that it is more representative ofnormal source operation"); 40 CFR §51.166 (b)(48)(i) (providing same discretion to approved permitting authorities).EPA is committed to workingwith NRG to complete a new applicabilitydeterminationfor the CECP. If such a determination is requested, pleasebe aware thatEPA will also considerPSD applicabilityfor greenhouse gases thatmightbe emitted from the project. See 40 CFR §52.21 (b)(48)(v)(b); 75 Fed. Reg. 31514,31527 (June 3, 2010). Ifyou have any questions, please contact Shaheerah Kelly ofthe Air PermitsOffice at (415) 947-4156. Sincerely,

DeborahJordan Director, Air Division

cc: Robert Kard, San Diego AirPollution Control District StevenMoore, San Diego Air Pollution Control District Tom Andrews, SierraResearch Mike Monasmith, California Energy Commission Will Walters, Aspen Environmental Group Joe Garuba, City ofCarlsbad