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Kevin P. Bundy • Senior Attorney • 351 California St., Suite 600 • San Francisco, CA 94104

Phone: 415-436-9682 x313 • Fax: 415-436-9683 • kbundy@biologicaldiversity.org 

 

October 17, 2012 

Via e-mail: R9airpermits@epa.gov 

Hard copy to follow via U.S. Mail 

Omer Shalev (AIR-3) 

U.S. EPA Region 9 

75 Hawthorne Street 

San Francisco, CA 94105-3901 

Phone: (415) 972-3538 

Re: Proposed PSD Permit Modification (Application No. SAC 12-01) 

Sierra Pacific Industries, Anderson Division 

Dear Mr. Shalev: 

The Center for Biological Diversity (“Center”) submits the following comments 

on the Proposed PSD Permit Modification (“Draft Permit”) and the accompanying 

Statement of Basis and Ambient Air Quality Impact Report (“SOB”) for the Sierra 

Pacific Industries (“SPI”) Anderson biomass power plant (“facility” or “project”). The 

Center is a non-profit environmental organization dedicated to the protection of imperiled 

species, their habitats, and the environment through science, policy, and environmental 

law. The Center has more than 470,000 members and online activists throughout the 

United States. The goal of the Center’s Climate Law Institute is to reduce U.S. 

greenhouse gas emissions and other air pollution to protect biological diversity, the 

environment, and public health. Specific objectives include securing protections for 

species threatened by the impacts of global warming, ensuring compliance with 

applicable law in order to reduce greenhouse gas emissions and other air pollution, and 

educating and mobilizing the public on global warming and air quality issues. 

A stationary source of air pollution in areas that attain applicable national ambient 

air quality standards (“NAAQS”) (or areas not classified) may not commence 

construction without first obtaining a prevention of significant deterioration (“PSD”) 

permit. See 42 U.S.C. §§ 7470-7479; 40 C.F.R. § 52.21. The permit must provide that 

“the proposed facility is subject to the best available control technology [“BACT”] for 

each pollutant subject to regulation under [the Clean Air Act] emitted from, or which 

results from, such facility.” 42 U.S.C. § 7475(a)(4); 40 C.F.R. § 52.21(j). The facility’s 

owner or operator also must demonstrate that emissions from the facility will not cause or 

contribute to air pollution in excess of any maximum allowable increase or concentration 

of air pollutants, any applicable NAAQS, or “any other applicable emission standard or 

standard of performance” under the Clean Air Act. 42 U.S.C. § 7475(a)(3)(A)-(C); 40 

C.F.R. § 52.21(k)-(m). The permit must be subject to a review process where the public 

has an opportunity to provide input on “the air quality impact of such source, alternatives 

CENTER for BIOLOGICAL DIVERSITY
Mr. Omer Shalev 

Re: Proposed PSD Permit Modification for SPI Anderson (Application No. SAC 12-01) 

October 17, 2012 

Page 2 of 14 

thereto, control technology requirements, and other appropriate considerations.” 42 

U.S.C. § 7475(a)(2); see generally 40 C.F.R. Part 124. 

As set forth below, the Draft Permit and SOB prepared by EPA for the facility do 

not meet the standards set forth in the Clean Air Act, EPA’s implementing regulations, 

and the decisions of the Environmental Appeals Board (“EAB”). EPA must either revise 

the Draft Permit and SOB to comply with these standards or deny the application. 

I. EPA’s Proposed Emission Limits for the Facility Do Not Properly Reflect 

BACT. 

BACT determinations “are one of the most critical elements in the PSD 

permitting process and thus ‘should be well documented in the record, and any decision 

to eliminate a control option should be adequately explained and justified.’” In re Russell 

City Energy Ctr., 15 E.A.D. __, PSD Appeal Nos. 10-01 to 10-05, slip op. at 58 (EAB 

Nov. 18, 2010); see also In re Indeck-Elwood LLC, 13 E.A.D. 126, 134 (EAB 2006); In 

re Knauf Fiber Glass, GmbH, 8 E.A.D. 121, 131 (EAB 1999) (“Knauf I”); In re Newmont 

Nev. Energy Inv., LLC, 12 E.A.D. 429, 442 (EAB 2005)). A BACT determination thus 

must reflect “considered judgment on the part of the permitting authority, as documented 

in the record.” Russell City, slip op. at 58 (internal quotations omitted). The 

Environmental Appeals Board has remanded permits “where the permit issuer’s BACT 

analyses were incomplete or the rationale was unclear.” Id. at 58 n.47. 

The SOB employs a version of the five-step, “top-down” BACT analysis 

described in EPA’s Draft New Source Review Workshop Manual.1

 “[I]n evaluating the 

rationality and defensibility of BACT determinations by permitting authorities, the 

[EAB] has required an analysis that reflects a level of detail in the BACT analysis 

comparable to the methodology in the NSR Manual.” In re General Motors, Inc., 10 

E.A.D. 360, 366 (EAB 2002) (citing In re Steel Dynamics, Inc., 9 E.A.D. 165, 183 (“This 

top-down analysis is not a mandatory methodology, but it is frequently used by 

permitting authorities to ensure that a defensible BACT determination, involving 

consideration of all requisite statutory and regulatory criteria, is reached.”); Knauf I, 8 

E.A.D. at 134 n. 25 (“A strict application of the methodology described in the NSR 

Manual is not mandatory, but we expect an analysis that is as sufficiently detailed as the 

model in the NSR Manual.”); id. at 129-30 n.14 (“We would not reject a BACT 

determination simply because the permitting authority deviated from the Draft NSR 

Manual, but we would scrutinize such a determination carefully to ensure that all 

regulatory criteria were considered and applied appropriately.”)). 

 

1

 U.S. EPA, Draft New Source Review Workshop Manual: Prevention of Significant 

Deterioration and Nonattainment Area Permitting (Oct. 1990) (hereafter “NSR Manual”). 
Mr. Omer Shalev 

Re: Proposed PSD Permit Modification for SPI Anderson (Application No. SAC 12-01) 

October 17, 2012 

Page 3 of 14 

A. EPA Has Not Demonstrated that the Draft Permit Reflects BACT for 

NOx. 

1. EPA Improperly Rejected Fluidized-Bed Boiler Designs as 

Technologically Infeasible. 

The SOB rejected fluidized-bed boiler designs for both NOx and CO as 

technologically infeasible at Step 2 of the BACT analysis. SOB at 12-13, 17. The SOB 

and the record do not support this determination. 

As a threshold matter, EPA relied on faulty assumptions in rejecting these 

alternatives. The SOB claims “SPI has not entered a binding power purchasing 

agreement with consistent base load energy demand.” SOB at 12. This statement does 

not provide a complete or accurate account of the relevant agreement. Although final 

state regulatory approval is still pending, SPI has entered into a power purchase 

agreement (“PPA”) with Pacific Gas & Electric Company (“PG&E”), as reflected in an 

Advice Letter PG&E recently filed with the California Public Utilities Commission.2

 

Prior to 2017, deliveries from the facilities covered by the PPA will not increase 

substantially, but rather will continue to be governed by current contracts due to expire in 

late 2016 and early 2017; after 2017, however, the Advice Letter suggests that the PPA 

will obligate SPI to serve “consistent base load energy demand,” particularly from the 

proposed Anderson facility. See Advice Letter at 1-2, 4, 10, 15. 

SPI’s primary reason for rejecting fluidized bed boiler alternatives is its claim that 

such boilers cannot be operated in “turndown” mode. SPI claims that because PG&E has 

more renewable energy than it needs through 2017, and because the PPA will allow 

PG&E to “vary the power production to suit their needs,” SPI must be able to vary steam 

production between 20% and 100%.3 Although the SOB’s explanation is not entirely 

clear, EPA appears to have accepted this rationale and concluded that when “electricity 

demand decreases,” the boiler will still need to supply a smaller amount of steam for the 

lumber kilns. SOB at 12-13.4

 

The PPA described in the Advice Letter, however, undercuts this rationale. 

Indeed, to the extent there is any feasibility problem, it appears to be exclusively 

contractual, not technical. It also appears to be temporary. Again, the Advice Letter 

 

2

 Pacific Gas & Elec. Co., Advice Letter 4102-E (Sept. 7, 2012) (hereafter “Advice 

Letter”) (attached as Ex. A). 

3

 Eric Albright, Environ Int’l Corp., Letter to Gerardo Rios, EPA Region 9, Re: 

Supplemental Control Technology Analysis at 2 (Jan. 23, 2012) (hereafter “Environ 

1/23/12 Letter”). 

4

 The SOB also considers the need to provide lower amounts of process steam during 

periods of turbine and generator malfunction. SOB at 12. However, it appears that the 

existing, smaller boiler at SPI’s facility—which would remain operational under the Draft 

Permit—could provide adequate process steam to the lumber drying kilns at times when 

the new, larger boiler is unavailable. 
Mr. Omer Shalev 

Re: Proposed PSD Permit Modification for SPI Anderson (Application No. SAC 12-01) 

October 17, 2012 

Page 4 of 14 

states that PG&E’s power purchase obligation from the Anderson facility will be limited 

to the amounts specified under current contracts until those contracts expire in 2016 and 

2017. Advice Letter at 10. SPI apparently proposes to begin operations at the proposed 

facility in 2014, but to sell only some limited amount of power for the next three years 

prior to ramping up to full power production in 2017. Thus the operational flexibility SPI 

seeks—along with permission to forgo technically feasible technology that would 

potentially reduce emissions—will be necessary only for three years, and only as a result 

of apparent contractual limitations that SPI itself participated in negotiating. 

Moreover, it is not clear that the operational flexibility SPI seeks is even 

necessary. Even if the PPA were to contain a clause allowing PG&E to “vary power 

production”—which is impossible to confirm because the text of the PPA is 

confidential—PG&E’s purported oversupply of renewable energy prior to 2017 would 

not necessarily be an impediment to consistent steam (and baseload energy) production at 

the Anderson facility beginning in 2014. This is because “any deliveries in excess of 

PG&E’s RPS compliance obligation will be bankable and available for use to satisfy 

future compliance period or year needs.” Advice Letter at 17-18. PG&E expects a 

tremendous need for renewable generation to satisfy its obligations under California’s 

Renewable Portfolio Standard in the third and subsequent compliance periods (i.e., after 

2017). Advice Letter at 15. It appears unlikely that PG&E would require SPI simply not 

to generate excess power that PG&E could easily bank in order to meet an acknowledged 

future compliance deficit. 

Even if SPI has negotiated a PPA that does not permit it to sell the facility’s full 

output for the first three years of operation, that business decision does not make 

fluidized-bed boiler alternatives technologically infeasible under Step 2 of the BACT 

analysis. Furthermore, this business decision should not be the basis of a permit allowing 

SPI to install and operate equipment that will emit pollutants at a higher rate for decades 

after 2017, when the rationale outlined in the SOB and the Environ 1/23/12 Letter will no 

longer apply. 

EPA must consider alternatives to the facility as proposed. 42 U.S.C. § 

7475(a)(2). In so doing, EPA may consider the need for the project. See In re Prairie 

State Generating Co., LLC, 13 E.A.D. 1, 31 (EAB 2006) (“[W]e are unable to reconcile 

the view that consideration of need for a facility is outside the scope of section 165(a)(2) 

of the Clean Air Act with the text of the statute and prior decisions.”). In order to give 

full effect to Congress’s direction to consider alternatives, moreover, EPA must have 

authority to deny a permit application if there are alternatives that better protect air 

quality. 

Under the terms of the PPA as described in the Advice Letter (and by SPI’s 

consultant), there simply is no need for this facility until 2017. The existing boiler 

obviously can supply sufficient steam to serve both process and current contractual 

energy delivery requirements. EPA therefore could deny the permit outright, without 

prejudice to renewing the application—and further considering fluidized-bed technology 

as BACT—once the need for the facility arises. 
Mr. Omer Shalev 

Re: Proposed PSD Permit Modification for SPI Anderson (Application No. SAC 12-01) 

October 17, 2012 

Page 5 of 14 

Another alternative would be to require further consideration of fluidized bed 

technology as BACT for the new boiler in the context of permit conditions prohibiting 

operation of the new boiler and allowing SPI to continue supplying power and process 

steam from its existing boiler until 2017 (or such other time as full baseload power 

deliveries are required under the PPA).5

 At the very least, the existence of these 

alternatives—which are consistent with the PPA as described in the Advice Letter, SPI’s 

submissions in the record, and the SOB’s rationale—demonstrates that fluidized-bed 

boiler designs should not have been rejected as technically infeasible. 

2. EPA Improperly Rejected Catalytic Control Technologies as 

BACT for NOx. 

The SOB lacks a clear and legally adequate explanation for EPA’s rejection of 

Selective Catalytic Reduction, Regenerative Selective Catalytic Reduction, and other 

catalytic variants (collectively “SCR”) as BACT for NOx, despite SCR’s clearly superior 

emissions reduction potential. 

EPA’s Step 2 analysis is somewhat inconsistent. EPA concluded that SCR is 

“technically feasible” for the facility. SOB at 13-14. Yet the SOB also emphasized that 

although a number of biomass facilities have been permitted with SCR as BACT, 

operational data is lacking and the “demonstrated effectiveness of SCR systems” at 

biomass facilities “remains limited.” SB at 14. Lack of “demonstrated” operational data, 

however, is not sufficient to reject an otherwise available and applicable technology as 

technologically infeasible. See NSR Manual at B.17-B.21. To the extent EPA based its 

rejection of SCR systems on a lack of demonstrated effectiveness at Step 2, therefore, it 

did so incorrectly.6

 SCR should have been clearly ranked as the top control option at 

Step 3.7

 

5

 Although Condition 18 of SPI’s Use Permit from Shasta County prohibits simultaneous 

operation of the new boiler and the existing boiler, this alternative would not require 

simultaneous operation. See Statement of Conditions, Use Permit No. 07-021 (attached 

as Ex. B). 

6

 In the same vein, the SOB states that “projected NOx emissions from those facilities 

permitted with SCR vary considerably.” SOB at 14. The basis for this statement is not 

clear; the SOB fails to provide any data on projected mass NOx emissions from SCR 

facilities. In any event, the variation between the emissions limit at any one of the SCR 

facilities identified in the SOB and SPI’s proposed limit of .13 lbs/MMBtu is far more 

“considerable” than any variation among the SCR facility limits themselves. SOB at 15, 

Table 7.1-1 (depicting emissions limits at six of seven SCR facilities as falling between 

.06 and .075 lbs/MMBtu). 

7

 Puzzlingly, EPA’s Step 3 analysis begins with SPI’s proposed NOx limits of .13 

lb/MMBtu (12-month rolling) and .15 lb/MMBtu (3-hour block average), and then lists 

“remaining technologically feasible control technologies . . . in decreasing order of 

effectiveness”—even though SCR is roughly twice as effective (at .06-.075 lb/MMBtu) 
Mr. Omer Shalev 

Re: Proposed PSD Permit Modification for SPI Anderson (Application No. SAC 12-01) 

October 17, 2012 

Page 6 of 14 

EPA also failed to properly evaluate cost-effectiveness at Step 4 of its analysis. 

“The purpose of step 4 is to either validate the suitability of the top control option 

identified or provide a clear justification as to why that option should not be selected as 

BACT.” In re Mississippi Lime Co., 15 E.A.D. __, PSD Appeal No. 11-01, slip op. at 12 

(EAB Aug. 9, 2011). 

[U]nder step 4, the permit issuer considers issues related to the relative 

cost effectiveness of the alternative control technologies, in addition to 

their energy and environmental impacts. [NSR Manual] at B.31-.46. The 

permit issuer evaluates the economic impacts by estimating the average 

and incremental cost-effectiveness of the control technologies, measured 

in dollars per tons of pollutant emissions removed. [Citation.] The permit 

issuer’s economic impacts analysis must generally be thorough and 

detailed. 

Id. at 16. 

The critical metric for economic impact analysis, however, is not the cost to the 

proposed source alone, but rather the cost-effectiveness of the proposed control relative 

to other similar sources that have employed that control. NSR Manual at B.31-B.32, 

B.44-B.45. “The principal purpose of the cost analysis is to determine if there are 

significant cost differences between the applicant and other sources that have adopted the 

control technology under review. . . . [T]he cost analysis also shows whether the costs of 

controls ‘are disproportionately high when compared to the cost of control for that 

particular pollutant and source in recent BACT determinations.’” General Motors, 10 

E.A.D. at 365 (quoting NSR Manual at B.45) (emphasis added); see also Mississippi 

Lime at 17 (remanding permit where rejection of BACT measure as “not commercially 

feasible” was based on a “single cost estimate” for the proposed plant). 

Neither the SOB nor SPI’s application contains comparative information about 

average and incremental costs of SCR controls at other biomass facilities that have 

employed SCR or RSCR as BACT. Rather, the SOB and application identify only the 

average and incremental costs for this facility.8

 See SOB at 15; App’n, App. B at 34 

(Table 2), 41-43. Evaluation of the economic impact on the proposed facility alone is 

insufficient to support rejection of a proposed control measure as BACT. Comparison 

 

as SPI’s proposed limit. SCR should clearly appear at the top of the control hierarchy at 

Step 3. NSR Manual at B.25-B.26. 

8

 The SOB briefly discusses the McNiel Generating Station, which adopted SCR 

technology as a voluntary measure in order to qualify for renewable energy credits, but 

offers no comparative cost information. SOB at 16. Rather, the SOB states only that the 

value of the credits is difficult to quantify, and that there might be other economic 

incentives at work. SOB at 16. These vague and speculative assertions about one 

facility—which reveal nothing at all about comparative costs at any of the other six 

facilities mentioned in the SOB—is entirely inadequate to demonstrate that SCR is not 

cost-effective at the SPI facility. 
Mr. Omer Shalev 

Re: Proposed PSD Permit Modification for SPI Anderson (Application No. SAC 12-01) 

October 17, 2012 

Page 7 of 14 

with cost of control in other BACT determinations for similar facilities is essential. See 

General Motors, 10 E.A.D at 375-78. The record does not support EPA’s proposed 

decision here. 

EPA also has failed to explain clearly why it selected SPI’s proposed NOx 

emission limits as BACT. Two similar facilities using the same control technology 

proposed here—selective non-catalytic reduction (“SNCR”)—have been permitted with 

lower emission limits. SOB at 15, Table 7.1-1. EPA claims SPI’s proposed limit is “the 

most stringent . . . for stoker boilers with SNCR demonstrated in practice,” SOB at 16, 

but the SOB fails to explain why “demonstrated in practice” should be the controlling 

factor here. If EPA wishes to adopt an emissions limit with a “margin of safety” for 

compliance, it must explain its choice of a limit clearly and identify adequate support in 

the record. See Mississippi Lime, slip op. at 24-33 (remanding permit where permitting 

authority failed to support its compliance margin determination with non-conclusory 

analysis and relevant compliance data). EPA has not even clearly stated that a 

“demonstrated in practice” emissions limit is necessary to provide a compliance margin, 

much less provided an adequate explanation or support for such a margin. 

B. EPA Has Not Demonstrated that the Draft Permit Reflects BACT for 

CO. 

EPA’s BACT analysis for CO is flawed for the same reasons its analysis of 

BACT for NOx is flawed. First, EPA rejected fluidized-bed boiler design alternatives as 

technically infeasible. SOB at 17. As described above, this was improper. Second, EPA 

again failed to compare the average and incremental cost of catalytic CO controls with 

equivalent costs at other comparable facilities, despite the greater effectiveness of 

catalytic control methods; as with control measures for NOx, EPA evaluated the cost of 

control in terms of this facility alone. SOB at 19. Again, as described above in the 

context of BACT for NOx, this is contrary to both EAB precedent and the NSR Review 

Manual. 

C. EPA Has Not Demonstrated that the Draft Permit Reflects BACT for 

PM, PM10, and PM2.5. 

EPA’s BACT analysis for PM also suffers from similar flaws as its analysis of 

BACT for NOx. Lower emission limits have been permitted at other facilities, both with 

the ESP and multiclone technology proposed by SPI and with the baghouse technology 

rejected here. SOB at 21. As with NOx emissions controlled by SNCR, EPA does not 

explain why it chose only a “demonstrated in practice” emissions limit rather than the 

most effective technically feasible control. Again, to the extent EPA is proposing some 

kind of compliance margin, it must state so explicitly, and must support its choice of an 

emissions limit with clear analysis and data in the record. 

EPA also once again fails to provide an adequate economic impact analysis in 

support of its rejection of baghouse technology, which has been used at other facilities to 

support lower emissions limits (.01 and .018 lb/MMBtu, as compared to SPI’s proposed 
Mr. Omer Shalev 

Re: Proposed PSD Permit Modification for SPI Anderson (Application No. SAC 12-01) 

October 17, 2012 

Page 8 of 14 

.02 lb/MMBtu). SOB at 21 and Table 7.1-5. Here, the SOB does not even discuss the 

average and incremental cost of control at this facility, much less provide comparative 

information about the cost of control at other, similar facilities. As set forth above in the 

context of BACT for NOx, this is inadequate. 

D. EPA Failed to Conduct an Adequate BACT Analysis for Emergency 

Engine Emissions. 

In the SOB, EPA rejected the most stringent emissions control option—purchase 

of a NSPS-compliant non-emergency engine for use as an emergency engine—without 

identifying average or incremental cost of controls, providing comparative cost 

information from other facilities, or even reviewing other BACT determinations. SOB at 

23-24. This is contrary to law. EPA’s “role as permit issuer requires the agency to 

investigate and examine recent regulatory determinations. . . . [EPA is] obligated to 

investigate and evaluate other facilities.” Mississippi Lime, slip op. at 23. EPA’s 

statement that “economic impacts and limited environmental benefit” would not justify 

use of a more stringent control technology, SOB at 23, is wholly conclusory and 

inadequate to support EPA’s rejection of the most effective control technology identified 

at Step 3. 

E. EPA Failed to Conduct an Adequate BACT Analysis for Cooling 

Tower Emissions. 

The SOB acknowledges that dry and hybrid wet-dry cooling are more effective 

control measures for PM emissions from the cooling tower. SOB at 25, Table 7.3-1. Yet 

EPA failed to provide any comparative economic analysis whatsoever in support of its 

rejection of these more effective technologies. SOB at 26. Instead, EPA relies solely on 

a conclusory and internally contradictory statement that “[t]he use of a dry or hybrid wetdry system would reduce the overall efficiency of the facility, due to the additional 

energy requirements for the wet and hybrid systems.” Id. It is not clear from this 

statement which systems have greater energy requirements, or why dry systems would 

cause a loss of efficiency due to the greater energy requirements of wet systems. The 

SOB further relies on the conclusory assertion that dry and wet-dry systems are “typically 

more costly,” without any supporting data or analysis in the record. Id. EPA appears to 

believe that “the limited total amount of particulate resulting from the cooling tower 

operation,” id., justifies a cursory, conclusory, and unsupported BACT analysis, but the 

SOB identifies nothing in the Clean Air Act or EPA’s implementing regulations that 

provides authority for what amounts to an ad hoc de minimis exemption from rigorous 

application of BACT requirements. 

II. EPA’s Air Quality Analysis Is Flawed. 

The air quality analysis in the SOB is deficient in at least two major respects. 

First, the SOB does not adequately explain its assumptions regarding startup and 

shutdown emissions. In particular, the air quality modeling assumes startup/shutdown 

NOx emission rates are the same as the normal operational emissions rate. SOB at 31. 
Mr. Omer Shalev 

Re: Proposed PSD Permit Modification for SPI Anderson (Application No. SAC 12-01) 

October 17, 2012 

Page 9 of 14 

This assumption is apparently based on a letter from SPI’s consultant stating that 

emission rates were “revised” following conversations with the boiler manufacturer.9

 But 

the description of the startup process by SPI’s consultant does not match the description 

of the same process in the SOB. SPI’s consultant states the entire startup process will 

take 12 hours (six hours of firing on natural gas and six hours on biomass fuel). Environ 

5/30/12 Letter at 2. The SOB, however, says both biomass fuel and natural gas will be 

fired together during startup, and that it will take 12 hours for the boiler to reach “50% of 

full load and attain a sufficient steady state temperature supporting the activation of the 

SNCR system.” SOB at 22. Accordingly, it appears that the boiler will operate without 

SNCR for 12 hours during startup, and will also operate without SNCR during shutdown 

once the boiler temperature once again drops below the appropriate range specified by 

the SNCR manufacturer. The SOB contains no explanation for why NOx emissions with 

and without the SNCR system activated would be exactly the same. The SOB’s BACT 

discussion suggests emission rates without SNCR may be significantly higher. See SOB 

at 15, Table 7.1-2. 

The SOB’s air quality analysis also fails to quantify secondary PM2.5 formation 

despite high emissions of NOx, a PM2.5 precursor. The SOB cites no evidence or 

analysis in support of its conclusory assertion that emissions of secondary PM2.5 would 

be significantly smaller than direct, primary emissions. SOB at 36. Again, conclusory 

statements unsupported by record evidence are insufficient. 

III. EPA’s Additional Impact Analysis Is Inadequate. 

The SOB concludes the project will have no harmful effects on animals, plants, 

soils and minerals because modeling demonstrates compliance with existing secondary 

NAAQS for SOx and NOx. SOB at 42. The existing secondary NOx/SOx standard, 

however, reflects only the acute phytotoxicity of these pollutants, not their more wideranging depositional effects on sensitive ecosystems.10 EPA recently concluded existing 

secondary standards are not sufficient to protect against terrestrial and aquatic 

acidification and nutrient enhancement caused by SOx and NOx deposition.11 As a 

result, EPA cannot rely on the fact that air modeling shows no violation of the secondary 

NAAQS as a proxy for analysis of depositional effects on soils and vegetation. 

 

9

 Eric Albright, Environ Int’l Corp., Letter to Gerardo Rios, EPA Region 9, Re: Updated 

Air Dispersion Modeling Analysis at 2 (May 30, 2012) (“Environ 5/30/12 Letter”). 

10 Secondary National Ambient Air Quality Standards for Oxides of Nitrogen and Sulfur; 

Final Rule, 77 Fed. Reg. 20,218, 20,234 (April 3, 2012). 

11 Id. at 20,241-42 (concluding “that the elements of the current standards are not 

ecologically relevant and thus are not appropriate to provide protection of ecosystems” 

and that “current levels of oxides of nitrogen and sulfur are sufficient to cause 

acidification of both aquatic and terrestrial ecosystems, nutrient enrichment of terrestrial 

ecosystems and contribute to nutrient enrichment effects in estuaries that could be 

considered adverse, and the current secondary standards to not provide adequate 

protection from such effects.”) 
Mr. Omer Shalev 

Re: Proposed PSD Permit Modification for SPI Anderson (Application No. SAC 12-01) 

October 17, 2012 

Page 10 of 14 

IV. The SOB Fails to Discuss Other Applicable Legal Requirements. 

The Clean Air Act and EPA’s implementing regulations clearly require that SPI 

demonstrate compliance with other applicable standards, including SIP provisions, NSPS, 

and NESHAP, in conjunction with its PSD permit application. See 42 U.S.C. § 

7475(c)(3); 40 C.F.R. § 52.21(j)(1). SPI’s application states that the project will be a 

major source of hazardous air pollutants, Application at 9, but it provides no data or 

analysis (other than a conclusory promise) demonstrating that the facility will comply 

with the applicable NESHAP for the proposed boiler. The SOB, in turn, does not discuss 

compliance with SIP provisions, NSPS, and NESHAP at all. Neither SPI nor EPA have 

satisfied the Act’s clear requirements here. 

EPA also has not adequately explained why or how it is processing this permit as 

a major modification. The Draft Permit is denominated a major modification of the 

facility’s 1994 PSD permit, SOB at 3-4, but the SOB contains no discussion of any 

contemporaneous emissions changes resulting from the modification, as required by EPA 

regulations and the NSR Manual. See 40 C.F.R. § 52.21(b)(3)(i); NSR Manual at A.37-

A.38. Nor does the SOB discuss the baseline(s) employed in evaluating the significance 

of emissions increases. Rather, the Draft Permit and SOB focus solely on the new boiler, 

as if it were the only emissions source at the facility. EPA’s omission of information on 

baseline emissions and overall changes associated with the modification makes it 

impossible to determine how EPA arrived at significance determinations for the various 

pollutants emitted by the facility. 

V. The Draft Permit Relies on Unlawful EPA Rules. 

A. EPA’s BACT Exemption for Biogenic CO2 Is Unlawful. 

EPA declined to consider BACT for the facility’s greenhouse gas emissions, 

citing the agency’s Deferral for CO2 Emissions from Bioenergy and Other Biogenic 

Sources under the Prevention of Significant Deterioration and Title V Programs, 76 Fed. 

Reg. 43,490 (July 20, 2011) (“Biomass Exemption Rule”). The Center and numerous 

other petitioners have challenged the Biomass Exemption Rule in the U.S. Court of 

Appeals for the District of Columbia Circuit. As set forth in the petitioners’ briefs filed 

in that challenge, the arguments of which are incorporated by reference here, the Biomass 

Exemption Rule is contrary to the Clean Air Act and must be vacated.12 The case is fully 

briefed and awaiting oral argument. Should the Biomass Exemption Rule be vacated, the 

treatment of biogenic CO2 emissions in the Draft Permit and SOB would violate the 

Clean Air Act. 

 

12 Center for Biological Diversity, et al., v. U.S. EPA, et al., Opening Brief of Petitioners 

(Corrected) (D.C. Cir. No. 11-1101, filed March 16, 2012) (attached as Ex. C); Center for 

Biological Diversity, et al., v. U.S. EPA, et al., Reply Brief of Petitioners (D.C. Cir. No. 

11-1101, filed July 10, 2012) (attached as Ex. D). 
Mr. Omer Shalev 

Re: Proposed PSD Permit Modification for SPI Anderson (Application No. SAC 12-01) 

October 17, 2012 

Page 11 of 14 

Regardless of the Biomass Exemption Rule, EPA has an independent obligation 

to consider less-polluting alternatives. 42 U.S.C. § 7475(a)(2). Nothing in the Biomass 

Exemption Rule calls into question EPA’s finding that greenhouse gases endanger public 

health and welfare.13 EPA therefore must evaluate alternatives that reduce dangerous 

carbon pollution. 

Biomass power plants are significant sources of greenhouse gases, regardless of 

the “biogenic” nature of biomass fuels. Recent scientific studies confirm that combustion 

of forest biomass increases atmospheric CO2 concentrations over a period ranging from 

years to decades or even centuries, depending on the feedstock.14 One just-published 

study concludes that when multiple harvests are assumed, and harvest occurs at a stand 

age typical of industrial forest management practices, atmospheric CO2 increases 

resulting from combustion may even be permanent.15 This increase in atmospheric CO2

concentrations occurs even where fuels are derived from harvest “residues”16 or forest 

thinning projects intended to reduce wildfire risk.17 

 

13 Endangerment and Cause or Contribute Findings for Greenhouse Gases Under Section 

202(a) of the Clean Air Act; Final Rule, 74 Fed. Reg. 66,496 (Dec. 15, 2009). 

14 See, e.g., Stephen R. Mitchell, et al., Carbon debt and carbon sequestration parity in 

forest bioenergy production, GCB Bioenergy (2012), doi: 10.1111/j.1757-

1707.2012.01173.x (attached as Ex. E); Ernst-Detlef Schulze, et al., Large-scale 

bioenergy from additional harvest of forest biomass is neither sustainable nor 

greenhouse gas neutral, GCB Bioenergy (2012), doi: 10.1111/j.1757-1707.2012.01169.x 

at 1-2 (attached as Ex. F); Jon McKechnie, et al., Forest Bioenergy or Forest Carbon? 

Assessing Trade-Offs in Greenhouse Gas Mitigation with Wood-Based Fuels, 45 Environ. 

Sci. Technol. 789 (2011) (attached as Ex. G); see also generally Timothy Searchinger, et 

al., Fixing a Critical Climate Accounting Error, 326 SCIENCE 527 (2009) (attached as Ex. 

__). 

15 Bjart Holtsmark, The outcome is in the assumptions: analyzing the effects on 

atmospheric CO2 levels of increased use of bioenergy from forest biomass, GCB 

Bioenergy (2012), doi: 10.1111/gcbb.12015 (attached as Ex. I). 

16 “[A] change in forest management practices, for instance, by decreasing the rotation 

length or increasing the use of harvest residues, also has a long-term impact on the 

landscape-level terrestrial stock or the stand-level C stock time-averaged over the 

rotation.” Kim Pingoud, et al., Global warming potential factors and warming payback 

time as climate indicators of forest biomass use, Mitig. Adapt. Strateg. Glob. Change 

(2011), DOI 10.1007/s11027-011-9331-9 at 2 (emphasis added) (attached as Ex. J); see 

also Anna Repo, et al., Indirect Carbon Dioxide Emissions from Producing Bioenergy 

from Forest Harvest Residues, Global Change Biology Bioenergy (2010), doi: 

10.1111/j.1757-1707.2010.01065.x (attached as Ex. K). 

17 John L. Campbell, et al., Can fuel-reduction treatments really increase forest carbon 

storage in the western US by reducing future fire emissions? Front. Ecol. Env’t (2011), 

doi:10.1890/110057 (attached as Ex. L); Tara Hudiburg, et al., Regional carbon dioxide 
Mr. Omer Shalev 

Re: Proposed PSD Permit Modification for SPI Anderson (Application No. SAC 12-01) 

October 17, 2012 

Page 12 of 14 

The Draft Permit would expand current permit conditions limiting fuels to 

“waste” materials18 in order to allow SPI to burn a wide range of biomass fuels derived 

from additional harvest of green, living trees. Draft Permit Conditions F.1, F.2 (defining 

“clean cellulosic biomass” as including “green wood” and “forest thinnings”). The 

Conditional Use Permit issued by Shasta County for the facility similarly permits 

combustion of virtually any legally harvested forest biomass material.19 As the scientific 

articles referenced above indicate, CO2 emissions from combustion of biomass derived 

from increased harvest of growing trees can remain in the atmosphere—and contribute to 

the climate-warming effects EPA found to endanger public health and welfare—for 

decades or centuries, or even forever. Even combustion of harvest “residuals” or other 

waste similarly can increase greenhouse pollution for many years. The proposed facility 

could emit in excess of 400,000 tons per year of CO2-equivalent greenhouse gases, SOB 

at 49-50, and thus has the potential to contribute significantly to air pollution causing 

endangerment. 

Accordingly, in examining alternatives to the proposed facility under Section 

165(a)(2), EPA must fully evaluate whether there are possible permit conditions 

(including limitations on biomass fuels) that will reduce or avoid substantial greenhouse 

gas pollution from the facility. 

B. “Grandfathering” Provisions in EPA’s Proposed Rule Revising the 

PM NAAQS Are Unlawful. 

EPA has proposed several revisions to the PM NAAQS, including reducing the 

annual PM2.5 standard to between 12.0 and 13.0 μg/m3

 and adopting a new PM2.5-

specific visibility standard.20 The SOB does not consider the facility’s compliance with 

the proposed revisions. Although the Draft Permit would qualify for “grandfathering” 

under the proposed rule,21 the proposed rule’s “grandfathering” provisions are unlawful, 

as shown in the Center’s comments to EPA (incorporated here by reference).22 

Accordingly, should the revisions go into effect before the final permit is issued, the 

facility will be required to demonstrate compliance. 

 

implications of forest bioenergy production, Nature Climate Change (2011), doi: 

10.1038/NCLIMATE1264 (attached as Ex. M). 18 See Eric Albright, Environ Int’l Corp., Letter to Gerardo Rios, EPA Region 9, Re: 

Response to Additional Information Request—Draft at 2-3 (Dec. 2, 2010). 

19 Statement of Conditions, supra note 5, at C-2 (Condition 11). 

20 National Ambient Air Quality Standards for Particulate Matter; Proposed Rule, 77 Fed. 

Reg. 38,890 (June 29, 2012). 

21 See id. at 39,023-24. 

22 Center for Biological Diversity, Comments on National Ambient Air Quality Standards 

for Particulate Matter; Proposed Rule at 20-24 (Aug. 31, 2012) (attached as Ex.N). 
Mr. Omer Shalev 

Re: Proposed PSD Permit Modification for SPI Anderson (Application No. SAC 12-01) 

October 17, 2012 

Page 13 of 14 

VI. Conclusion 

For the foregoing reasons, the Draft Permit and SOB do not meet the 

requirements of the Clean Air Act, EPA’s implementing regulations, the NSR Review 

Manual, and applicable EAB precedent. The permit cannot lawfully be finalized as 

drafted. 

Sincerely, 

Kevin P. Bundy 

Senior Attorney 

Attachments 
Mr. Omer Shalev 

Re: Proposed PSD Permit Modification for SPI Anderson (Application No. SAC 12-01) 

October 17, 2012 

Page 14 of 14 

List of Exhibits 

(submitted as PDF files via e-mail and on CD enclosed with hard copy) 

Exhibit Title 

A Pacific Gas & Elec. Co., Advice Letter 4102-E (Sept. 7, 2012). 

B County of Shasta, California, Statement of Conditions, Use Permit No. 07-021. 

C Center for Biological Diversity, et al., v. U.S. EPA, et al., Opening Brief of 

Petitioners (Corrected) (D.C. Cir. No. 11-1101, filed March 16, 2012). 

D Reply Brief of Petitioners (D.C. Cir. No. 11-1101, filed July 10, 2012). 

E Stephen R. Mitchell, et al., Carbon debt and carbon sequestration parity in 

forest bioenergy production, GCB Bioenergy (2012), doi: 10.1111/j.1757-

1707.2012.01173.x. 

F Ernst-Detlef Schulze, et al., Large-scale bioenergy from additional harvest of 

forest biomass is neither sustainable nor greenhouse gas neutral, GCB 

Bioenergy (2012), doi: 10.1111/j.1757-1707.2012.01169.x. 

G Jon McKechnie, et al., Forest Bioenergy or Forest Carbon? Assessing TradeOffs in Greenhouse Gas Mitigation with Wood-Based Fuels, 45 Environ. Sci. 

Technol. 789 (2011). 

H Timothy Searchinger, et al., Fixing a Critical Climate Accounting Error, 326 

SCIENCE 527 (2009). 

I Bjart Holtsmark, The outcome is in the assumptions: analyzing the effects on 

atmospheric CO2 levels of increased use of bioenergy from forest biomass, 

GCB Bioenergy (2012), doi: 10.1111/gcbb.12015. 

J Kim Pingoud, et al., Global warming potential factors and warming payback 

time as climate indicators of forest biomass use, Mitig. Adapt. Strateg. Glob. 

Change (2011), DOI 10.1007/s11027-011-9331-9. 

K Anna Repo, et al., Indirect Carbon Dioxide Emissions from Producing 

Bioenergy from Forest Harvest Residues, Global Change Biology Bioenergy 

(2010), doi: 10.1111/j.1757-1707.2010.01065.x. 

L John L. Campbell, et al., Can fuel-reduction treatments really increase forest 

carbon storage in the western US by reducing future fire emissions? Front. 

Ecol. Env’t (2011), doi:10.1890/110057.

M Tara Hudiburg, et al., Regional carbon dioxide implications of forest bioenergy 

production, Nature Climate Change (2011), doi: 10.1038/NCLIMATE1264. 

N Center for Biological Diversity, Comments on National Ambient Air Quality 

Standards for Particulate Matter; Proposed Rule (Aug. 31, 2012).