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OAR Box 1781 

Prepped by Ollie Stewart 

Document Number: 

45) ll-K-2 

Docket Number: 

A-90-37 

Printed 10/29/2008 10:46:20 AM Sheet 45 of 142 
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V. ,,'., 

BEFORE THE ADMINISTRATOR 

U.S. ENVIRONMENTAL PROTECTION AGENCY 

WASHINGTON, D.C. 

In the Matter of: 

Honolulu Resource 

Recovery Facility, 

Applicant 

PSD Appeal No. 86-8 

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REMAND . ;•' -'"' • J/iiV 2 51995 ill'' ' 

Sierra Club, Conservation Council for Hawaii,,; AmerieiOrEung 

Association of Hawaii, Life of the Land, and Joseph -Sling eV~4Petitioners) jointly request review of a Prevention of Significant 

Deterioration (PSD) permit determination that will authorize the 

City and County of Honolulu to construct the Honolulu Resource 

y 

Recovery Facility (H-Power), a municipal waste burner. A 

final decision to issue a permit was made on November 17, 1986, 

by the Hawaii Department of Health (HDOH), with EPA Region IX's 

concurrence, pursuant to a delegation agreement between Region 

IX and HDOH. HDOH's action in issuing the permit is subject 

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to the review provisions of 40 CFR §124.19, because the 

1/ Hiroji Abe also submitted a petition for review dated 

December 20, 1986, which this office received on December 30, 

1986. The rules require that petitions for review of a permit 

determination be filed within 30 days of issuance (plus mailing 

time). 40 CFR §§124.19 and 124.20. In this case a petition 

had to be postmarked by December 20, 1986. The record contains 

no evidence of when Mr. Abe mailed the petition, but the fact 

that the petition was not received until December 30 leads to 

a conclusion that the petition is untimely. Accordingly, the 

petition is dismissed. Additionally, I note that Mr. Abe does 

not raise any issues not encompassed by Petitioner's petition 

for review. 

2/ All references to the Code of Federal Regulations (CFR) are 

to the 1986 edition. 
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permit is deemed to be an EPA-issued permit under EPA rules. 40 

CFR §124.41; 45 Fed. Reg. 33,413 (May 19, 1980). Until review 

is completed the H-Power facility is without an effective permit 

and therefore is not authorized to begin construction. 

Petitioners protest issuance of the permit because they believe it does not require, as it is suppose to, use of the best 

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available control technology (BACT) for sulfur dioxide (SO2) 

and because they believe the permitting authority did not evaluate 

the impact of the SO2 control technology on unregulated pollutants, 

as required by North County Resource Recovery Associates, PSD 

Appeal No. 85-2 (June 3, 1986). In response to the petition 

for review, Region IX states that it has reevaluated the record 

and considered new information on municipal waste incineration, 

and now concludes that the BACT determination for H-Power may 

not be appropriate. In view of the Region's response and after 

considering the petition for review and the various responses, 

I agree with the Region that HDOH's BACT determination for SO2 

may be inappropriate. Also, the analysis required by North 

County of the impact of controls on emissions of unregulated 

pollutants appears to be inadequate. Therefore, I am remanding 

the concurrence to the Region for reconsideration. 

3/ Although Petitioners also declare that the BACT determination for 

particulate matter and hydrochloric acid is unlawful, their petition 

only addresses the BACT determination for SO2 and fails to provide 

any supporting arguments for these other claims. For this reason, 

the Region and HDOH. direct their responses to the SO2 BACT determination and this remand concerns only the SO2 BACT determination. 
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Discusaion 

Before a major new facility can be constructed in an area 

1/ that is meeting the National Ambient Air Quality Standards (NAAQS), 

the owner must obtain a PSD permit to construct and operate the facility. 42 U.S.C. §§7470-79. The Clean Air Act conditions permit 

issuance on a showing that the proposed facility will employ BACT 

for each regulated pollutant emitted from it in significant amounts. 

42 U.S.C. §7475. Section 169 of the Act defines BACT as an 

"emission limitation reflecting the maximum degree of reduction" 

that the "permitting authority," on a "case-by-case basis, 

taking into account energy, environmental, and economic impacts 

and other costs" determines is "achievable." 42 U.S.C. §7479(3). 

EPA Region IX delegated its authority to issue PSD permits to 

HDOH in 1983, subject to the Region's concurrence on BACT 

determinations for the first five permits. 48 Fed. Reg. 51,682 

(November 10, 1983). 

H-Power,.a resource recovery facility that will burn municipal solid waste and generate electricity from this process, is the 

first source to receive a permit determination from HDOH under the 

delegation. HDOH made a final decision to issue a permit for H-Power 

on November 14, 1986, and EPA signed the permit to concur in the 

BACT determination on November 17, 1986. Pursuant to §124.15, a 

final permit decision becomes effective 30 days after service of 

4/ H-Power will be located in an area designated as being in 

attainment of the SO2 NAAQS. 40 CFR §81.312. 
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notice of the decision unless review is requested under §124.19. 

5/ 

Petitionera requested review under §124.19 in a timely manner; 

thus the permit decision is not effective. 

The events leading to the HDOH permit decision need not 

be detailed here; the highlights will suffice. 

Initially, HDOH issued a draft permit containing SO2 limits 

of 191 parts per million (ppm) and 349 lbs/hr (3-hour average) 

but requiring nothing in terms of technological emission controls 

for SO2. Region IX expressed its disapproval, taking the 

position that BACT for a municipal waste burner such as H-Power 

calls for use of a dry scrubber, since it would enable the 

facility to achieve SO2 emission limits of 30 ppm (approximately 

80% removal efficiency). HDOH persisted, however, reiterating 

its position that local environmental, economic, and energy 

impacts support a conclusion that scrubbers are not required 

for H-Power. In the end the Region and HDOH reached a compromise 

5/ HDOH argues that the petition should be dismissed under §124.19 

for failure to include a "demonstration" that the issues being 

raised in the petition were raised during the public comment 

period. The Region agrees that the petition does not include a 

statement to this effect, but points out that the exhibits 

submitted with HDOH's response show that the issues were indeed 

raised during Jthe public comment period. So, the Region suggests 

that the Petitioners' failure to comply with this "technical" 

requirement is harmless error. I am inclined to agree with the 

Region. The purpose of the requirement is to inform the Administrator whether a petition for review meets the prerequisites 

for consideration, i.e., that the permit issuer had an opportunity 

to address the issue during the public comment period prior to 

issuing the permit. 40 CFR §124.13. Since the exhibits supplementing the responses by the parties indicate that Petitioners 

did raise the issues below, I see no harm caused by Petitioners' 

omission. 
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in a final permit decision that sets SO2 limits at 143 ppm and 

349 lbs/hr on a 3-hour average (only a 25% reduction according to 

i/ 

the Region) to be met without scrubbers, by removing high-sulfur 

bearing materials prior to combustion of the waste. In addition, 

the permit provides for the later addition of a dry sorbent 

injection system if necessary to meet the emissions limits in 

the permit. 

Based on a reevaluation of the record and new information 

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on municipal waste incineration, the Region now believes that 

HDOH's BACT determination may not be appropriate. The Region 

points out that 17 of 21 municipal waste burners in the Region 

will have scrubbers and of the remaining four, three will achieve 

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S02:control of over 90% efficiency. Considering the difference 

in control efficiency between H-Power and these other resource 

recovery projects, the Region concludes that HDOH has not 

presented a compelling case that local factors are sufficient 

to warrant allowing a less effective control technology for 

6/ HDOH asserts that 57% reduction of SO2 emissions will result 

from the 143 ppm rate. 

l_l According to EPA Region IX, the new information includes presentations at three recent conferences 1) the American Pollution 

Control Association Conference entitled "Burning Our Garbage: 

Issues and Alternatives," October 30-31, 1986 in San Francisco; 

2) An EPA workshop on municipal waste combustion, December 9-10, 

1986 in North Carolina; and 3) the "First National Regulatory 

Agency Resource Recovery Workshop" sponsored by the California 

Air Pollution Control Officers Association and Northeast States 

for Coordinated Air Use Management, January 15-17, 1987 in Los 

Angeles. 

8/ The last project is small and will have SO2 emissions of 

45 ppm. 
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2/ 

H-Power. Furthermore, the Region asserts that HDOH failed 

to analyze the impact of the proposed controls on unregulated 

pollutants as required by North County. For these reasons, 

the Region requests the Administrator to grant review on the 

BACT determination. 

Administrative review of PSD permit decisions is not usually 

granted unless the permit decision is clearly erroneous or involves 

an exercise of discretion or policy that is important and therefore 

should be reviewed by the Administrator as a discretionary matter. 

40 CFR §124.19. "This power of review should be only sparingly 

exercised . . . ."45 Fed. Reg. 33,412 (May 19, 1980). The 

regulations envision that disputed permit conditions will be 

resolved for the most part at the regional level. I_d. This is 

9_/ Simply because most of the municipal waste burners in the 

Region will employ scrubbers for SO2 control does not, as a matter 

of law, compel a conclusion that H-Power must have scrubbers. See 

Northern Plains Resource Council v. U.S. EPA, 645 F.2d 1349 (9th 

Cir. 1981); In the Matter of New York Power Authority, PSD Appeal 

No. 82-4 (Dec. 6, 1983). However, the fact that essentially all 

municipal waste burners will have scrubbers and because these 

scrubbers are effective in controlling emissions of potentially 

toxic organic and heavy metal pollutants, and acid gases other 

than SO2, demonstrates that the technology is available. Accordingly substantial and unique local factors must be shown to 

justify a less efficient control technology. 

10/ HDOH does not claim that its BACT determination included an 

evaluation of the impact of the SO2 controls on unregulated pollutants; rather it argues that in the process of making a final 

permit decision, it evaluated the potential impact of unregulated 

pollutants emitted from H-power and revised the permit to "buffer 

these impacts" by including a requirement for higher combustion 

temperatures and longer retention time in the boilers. HDOH 

also added a term that requires compliance with any additional 

guidance developed as a result of the North County remand. 

HDOH claims this satisfies the requirements of North County. 
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particularly true for BACT determinations because they involve 

individualised consideration of the facts of each case. See 

In the matter of CertainTeed Corporation, PSD Appeal No. 81-2 

(December 21, 1982). Given the limited purpose of this review 

and the fact that BACT determinations should be made, at least 

in the first instance, at the regional or local level, I am 

remanding the concurrence to the Region for reconsideration. 

Since the Region now expresses doubt about its concurrence on 

the BACT, I conclude that the proper course of action is for 

the Region to reconsider its decision and either find that the 

evidence supports its initial decision to concur or, if not, to 

ii/ 

make what it considers the correct determination. The Region 

will have to determine whether the applicant has met its burden 

of demonstrating that significant technical defects, or substantial 

local economic, energy, or environmental factors or other costs 

warrant a control technology less efficient than scrubbers. 

In reconsidering its concurrence the Region should consult 

with national or other regional level EPA program officials, and 

may obtain more information from HDOH or H-Power, perform 

additional analysis, or otherwise work with HDOH, as appropriate. 

11/ HDOH points to the Region's official concurrence in the 

BACT determination and argues that the Region's current position 

is inconsistent with the delegation agreement. In making this 

argument, HDOH ignores the nature of the delegation agreement 

and the fact that it is subject to the permitting procedures in 

Part 124. The delegation agreement is not a private bond 

indenture or lease; it is an instrument for implementing a law 

enacted in the public interest. As stated a decade ago in an 

EPA permit proceeding: 

(Footnote continued) 
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After such reconsideration, the Region is to issue a full 

report to the Administrator and the parties on its decision and 

the supporting reasons. Whatever the Region decides must be 

adequately supported by the existing administrative record 

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and any supplements thereto. If the Region decides to withdraw its concurrence, it must set out its own BACT determination 

and include a discussion of why the local factors raised by HDOH 

are not sufficient to justify the initial BACT determination. 

(Footnote 11 continued) 

The Agency is the representative of the public interest 

and is not "an umpire blandly calling balls and strikes 

for adversaries appearing before it; the right of the 

public must receive active, and affirmative protection" 

at the hands of the Agency. [Scenic Hudson Preservation 

Conference v. FPC, 354 F.2d 608, 620 (2d Cir. 1965) cert. 

denied 384 U.S. 941 (1966).] The courts have made clear 

that the Agency must take affirmative steps to obtain the 

information necessary to sound decisions under the statutes 

it administers, even at the cost of delay ... . 

In re Public Service Company of New Hampshire, et. al. (Seabrook 

Station, Units 1 and 2), 10 ERC 1257, 1263 (1977T. The instant 

case represents a situation where the Region retained authority 

in the delegation agreement to review and concur in BACT determinations and now the Region expresses second thoughts about 

its concurrence. As Justice Frankfurter stated, "Wisdom too 

often never comes, and so one ought not to reject it merely 

because it comes late." Henslee v. Union Planters Nat. Bank & 

Trust Co., 335 U.S. 595, 600, 69 S. Ct. 290, 293, 93 L Ed 259 

(1948). Certainly, the Administrator, with his statutory 

responsibility to protect the environment, should look at the 

Region's concerns or, if appropriate, direct the Region to 

reconsider its decision to concur. The permit, after all, is 

not yet effective. 

12/ In its response to the petition, HDOH argues that 40 CFR §124.13 

prohibits consideration of new information because this information 

is not part of the administrative record. I disagree. Section 

124.13 directs parties objecting to any conditions of the draft 

permit to submit their comments during the public comment period. 

(Footnote continued) 
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After reviewing the Region's decision on remand and any 

responses by the parties, I will issue a ruling on the petition 

for review. In the meantime, the pending petition for review 

will be held in abeyance. 

During the time the Region is reconsidering its concurrence, 

the Region and HDOH may choose to negotiate revisions to the 

H-Power BACT determination and issue a new permit decision. If 

so, any revised permit decision, unless appealed, will become 

final within 30 days of service of notice to the Petitioners, 

the permit applicant, and any other parties previously entitled 

to notice under 40 CFR §124.15. 

So ordered. 

Dated: T-~l ; l°!<?7 

Lee M. Thomas 

Administrator 

(Footnote 12 continued) 

It does not apply to the permitting authority or, in this case, 

to Region IX because of the Region's relationship to the permitting authority under the delegation agreement. Nor does §124.13 

prohibit the Administrator from considering new information. In 

view of the Administrator's broad authority to review permit 

decisions, including the right to remand under §124.19, the 

Administrator has the power to direct the Regional Administrator 

or HDOH to consider new information and to seek further evidence 

on relevant points. See In the matter of 170 Alaska Placer 

Miners, More or Less, NPDES Appeal No. 79-1 (Mar. .10, 1980); In 

re Public Service Company of New Hampshire, et. al. (Seabrook 

Station, Units 1 and 2), 10 ERC 1257 (Decision of the Administrator, 

1977). 
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» 

» 

CERTIFICATE OF SERVICE 

I hereby certify that the copies of the foregoing Remand 

in the Matter of Honolulu Resource Recovery Facility, PSD 

Appeal No. 86-8, were served upon the following persons by 1st 

class mail, postage prepaid: 

John C. Lewin, M.D. 

Department of Health 

State of Hawaii 

P.O. Box 3378 

Honolulu, Hawaii 96801 

Judith E. Ayres 

Regional Administrator 

U.S. EPA, Region IX 

215 Fremont Street 

San Francisco, CA 94105 

Joseph J. Brecher, Esq. 

506 15th Street 

Oakland, CA 94612 

Jeremy Harris 

Managing Director 

City and County of Honolulu 

Honolulu, Hawaii 96813 

Joseph A. Cannon, Esq. 

Suite 1100 

1667 K Street, N.W. 

Washington, D.C. 20006 

John C. Wise 

Deputy Regional Administrator 

U.S. EPA, Region IX 

215 Fremont Street 

San Francisco, CA 94105 

David P. Howekamp, Director 

Air Management Division 

U.S. EPA, Region IX 

215 Fremont Street 

San Francisco, CA 94105 

Hiroji Abe 

P.O. Box 4285 

Honolulu, Hawaii 96812-4285 

Brenda H. Selden 

Dated: JUM 23 OT Secretary to the Chief 

i>fl^ **+ •» 1 sy^^i •*«»•