## U.S. ENVIRONMENTAL PROTECTION AGENCY REGION IX

STATEMENT OF BASIS AND AMBIENT AIR QUALITY IMPACT REPORT

For a Clean Air Act Prevention of Significant Deterioration Permit



# Navajo Generating Station

Low-NO x 

# Burner Project PSD Permit Number AZ 08-01

October 2008

Navajo Generating Station PSD Permit AZ 08-01 Draft Ambient Air Quality Impact Report, October 2008

### NAVAJO GENERATING STATION – LOW-NO x 

### BURNER PROJECT Statement of Basis and Ambient Air Quality Impact Report (PSD Permit AZ 08-01)

Table of Contents

Acronyms & Abbreviations

I. APPLICANT INFORMATION .......................................................................................... 4

II. PROJECT LOCATION ...................................................................................................... 4

III. PROCESS DESCRIPTION ................................................................................................ 4 A. Facility Description ..................................................................................................... 4 B. Project Description ...................................................................................................... 4 C. Air Pollution Control Equipment ................................................................................ 5

IV. EMISSIONS FROM THE PROJECT ................................................................................ 6

V. APPLICABILITY OF SIGNIFICANT DETERIORATION ............................................. 6

VI. BEST AVAILABLE CONTROL TECHNOLOGY ........................................................... 7

VII. AIR QUALITY IMPACTS ............................................................................................... 11 A. Meteorological and Background Ambient Air Quality Data .................................... 11 B. Modeling Methodology ............................................................................................ 12 C. NAAQS Compliance ................................................................................................ 13 D. Increment Consumption Analysis and Increment Compliance ................................ 14

VIII. ADDITIONAL IMPACT ANALYSIS ............................................................................. 14 A. Growth Analysis ....................................................................................................... 14 B. Soils and Vegetation Analysis .................................................................................. 14 C. Visibility Impairment and Air Quality Related Value Analysis ............................... 15

IX. ENDANGERED SPECIES ............................................................................................... 15

X. CONCLUSION AND ACTION ....................................................................................... 15

APPENDIX A

Navajo Generating Station PSD Permit AZ 08-01 Draft Ambient Air Quality Impact Report, October 2008 2 of 17Acronyms & Abbreviations

AAQIR Ambient Air Quality Impact Report AQRV Air Quality Related Value BACT Best Available Control Technology BART Best Available Retrofit Technology CAA Clean Air Act CEMS Continuous Emissions Monitoring System CFR Code of Federal Regulations CO 2 Carbon Dioxide CO Carbon Monoxide EPA United States Environmental Protection Agency oF Degrees Fahrenheit FIP Federal Implementation Plan GCP Good Combustion Practices LAER Lowest Achievable Emission Rate lb/MMBtu Pound per Million British Thermal Units LNB Low-NO x Burner μg/m 3 micrograms per cubic meter MMBtu/hr Million British Thermal Units per hour MW megawatt NAAQS National Ambient Air Quality Standard NESHAP National Emission Standards for Hazardous Air Pollutants NWS National Weather Service NGS Navajo Generating Station NO 2 Nitrogen dioxide NO x Nitrogen oxide O 2 Oxygen PM Particulate Matter ppm parts per million PSD Prevention of Significant Deterioration PTE Potential to Emit RACT Reasonably Available Control Technology RBLC RACT/BACT/LAER Clearinghouse SCR Selective Catalytic Reduction SNCR Selective Non-catalytic Reduction SOFA Separate Over-fire Air SIL Significant Impact Level scf/MMBtu standard cubic feet per Million British Thermal Units NSPS Standard of Performance for New Stationary Sources SO 3 Sulfite SO 2 Sulfur dioxide H 2 SO 4 Sulfuric acid SRP Salt River Project Agricultural and Power District tpy tons per year USGS United States Geological Survey VOC Volatile Organic Compound

Navajo Generating Station PSD Permit AZ 08-01 Draft Ambient Air Quality Impact Report, October 2008 3 of 17This document serves as the Statement of Basi s and Ambient Air Quality Impact Report for the proposed Prevention of Significant Deterioration (PSD) permit for the Navajo Generating Station – Low-NO x Burner Project. This document describes the legal and factual basis for the proposed permit, including requirements under the PSD regul ations at Title 40 of the Code of Federal Regulations (CFR) §52.21. This document also serves as the fact sheet to meet the requirements of 40 CFR Part 124.7 and 124.8.

I. APPLICANT INFORMATION

Applicant Name: Salt River Project Agri cultural and Power District (SRP) Facility Name: Navajo Generating Station Mailing Address: P.O. Box 850, Page, AZ 86040

II. PROJECT LOCATION

The Navajo Generating Station (NGS) is located on the Navajo Nation Indian Reservation, approximately five miles east of Page off U.S. Highway 98, in Coconino County, Arizona.

III. PROCESS DESCRIPTION

A. Facility Description

The NGS consists of three existing coal-fir ed steam generating un its, associated air pollution control devices and auxiliary equipm ent necessary to produce electricity. This facility has a combined power generating capacity of 2,250 net megawatts and became operational in stages between 1974 and 1976. Units 1, 2, and 3 are operated by SRP and co-owned by the following six entities: U.S. Bureau of Reclamation, SRP, Los Angeles Department of Water and Power, Arizona P ublic Service Company, Nevada Power, and Tucson Electric Power Company. The facility receives coal with a maximum sulfur content of 1.5% by weight from the Pea body Western Coal Comp any’s Kayenta Mine. Light fuel oil, in accordance with the Ameri can Society for Testing and Materials grade 2 (commonly known as Fuel Oil No.2) serves as the ignition fuel for the units.

B. Project Description

SRP has proposed the Low-NO x Burner Project as a volunt ary measure to significantly reduce emissions of nitrogen oxide (NO x ) from all three boiler units at the NGS. The project involves the installation of Low-NO x Burners (LNB) with Separated Over-fire Air (SOFA) systems over a three-year period (s ee schedule in Table 1). A LNB and SOFA system reduces NO x emissions by controlling air and fuel flow to create fuel-rich and O 2 - poor conditions in the burner, and stages the addition of over-fire air beyond the burner combustion zone to complete combustion in a lower temperature environment which reduces the formation of thermal NO x .

Navajo Generating Station PSD Permit AZ 08-01 Draft Ambient Air Quality Impact Report, October 2008 4 of 17The Regional Haze rules found in 40 CFR Part 308 will require NGS to install Best Available Retrofit Technology (BAR T) for visibility impairing pollutants. EPA is in the process of evaluating the NO x and particulate matter emissions from this plant to determine BART for this facility. EPA pl ans to propose a revision to the Federal Implementation Plan (FIP) for NGS within a fe w months, to require the facility to meet emission limits achievable through the appli cation of BART. EPA will promulgate the final FIP incorporating BART following the public review and comment process. The potential control technologies for NO x reduction at this faci lity for BART include LowNO x Burners with Separated Over-fire Air, Selective Non-catalytic Reduction (SNCR) with ammonia injection, and Selective Catalytic Reduction (SCR). For this facility, LNB/SOFA will likely be part of any BART determination even if the final BART FIP requires further reduction using SNCR or SCR co ntrols. BART is required to be installed as soon as practicable but no later than five years after promulgation of the FIP.

The early installation of the LNB/SOFA system s will not affect the baselines for cost or visibility improvements in the BART determ ination, and therefore will not influence EPA’s determination of the proper NO x reductions required to be achieved from BART.

While the LNB/SOFA retrofit project that is the subject of this permit will result in significant NO x emission reductions, it will result in carbon monoxide (CO) emission increases. Due to the nature of com bustion, boiler modifications to reduce NO x emissions will result in incomplete combusti on which increases CO emissions. SRP has determined that the CO net emission incr ease resulting from th e proposed LNB/SOFA retrofits will be greater than the 100 tons per year significance threshold for CO under the Prevention of Significant Deterioration (PSD ) provisions (see Section V), and therefore has submitted a PSD permit application for the project.
This PSD permit would grant conditional appr oval to SRP, in accordance with the Clean Air Act and the PSD regulations at 40 CF R 52.21, to modify each boiler by installing LNBs and SOFA systems in each boiler. If the proposed permit is finalized in 2008, one boiler will be retrofitted during each of the ne xt three calendar years as indicated in Table 1 consistent with SRP’s anticip ated planned outage schedule.

Table 1. Low-NO x Burner Project Schedule Boiler Unit Projected LNBs Opera tional Date Max. Heat Input 3 March 22, 2009 7,725 MMBtu/hr 2 March 28, 2010 7,725 MMBtu/hr 1 April 3, 2011 7,725 MMBtu/hr

C. Air Pollution Control Equipment

The existing coal combustion equipment on boiler units 1, 2, and 3 will each be replaced with an Alstom LNB/SOFA system. Th e LNB will reduce the formation of NO x emissions by burning the coal in a fuel-ric h, reducing environment. This reduces the concentration of oxygen available for the react ion with fuel nitrogen and reduces flame temperatures to minimize the formation of thermal NO x . The SOFA system will decrease

Navajo Generating Station PSD Permit AZ 08-01 Draft Ambient Air Quality Impact Report, October 2008 5 of 17the amount of incomplete combustion in th e furnace and, therefore, also minimize the formation of NO x emissions.

The facility will install a c ontinuous emissions monitoring system (CEMS) in each stack exhaust to measure and record CO concentr ations once the LNBs and SOFA systems are installed. The facility will also operate, maintain, and quality-assure a CEMS in each stack exhaust to measure NO x concentrations according to the requirements of 40 CFR Part 75.

IV. EMISSIONS FROM THE PROJECT

As discussed in Section III.B, the LNB/SO FA system on each existing boiler will reduce NO x emissions but will collaterally increas e CO emissions. Pursuant to 40 CFR 52.21(a)(2)(iv)( c ), SRP compared the baseline actual emissions to projected actual emissions in order to determine PSD app licability for this project (Table 2).

Table 2. Summary of CO and NO x Emissions Boiler

Unit Pollutant Pre-Project Baseline Emissions 1 (tpy) Projected Actual Emissions 2 (tpy) NO x 12,647 7,462 1 CO 707 12,903 NO x 11,660 7,462 2 CO 659 12,903 NO x 10,342 7,462 3 CO 675 12,903

1 Baseline actual emissions are based on average emissions from the NGS 2006 and 2007 emission

inventory reports, which satisfies the regulatory provision at 40 CFR 52.21(b)(48)(i).
2 The projected actual emissions are based on a re presentative 2-year period between 2014 and 2016

shown to have the highest utilization during the next ten years following the project, which satisfies the regulatory provision at 40 CFR 52.21(b)(41).

V. APPLICABILITY OF PREVENTION OF SIGNIFICANT DETERIORATION

The Navajo Generating Station is located within the Northern Arizona Intrastate Air Quality Control Region which is designated by the EPA as an unclassified or attainment area for all criteria pollutants: carbon monoxide (CO); nitrogen dioxide (NO 2 ); sulfur dioxide (SO 2 ); ozone, regulated by its precursors, volatile organic compounds (VOC) and oxides of nitrogen (NO x ); particulate matter with an aerodynamic diameter less than 10 micrometers (PM 10 ); fine particulate matter with an aerodynamic diameter less than 2.5 micrometers (PM 2.5 ); and lead (Pb).

The Prevention of Significant Deterioration (PSD) regulations at 40 CFR 52.21 define a “major stationary source” as any source ty pe belonging to a list of 28 source categories which emits or has the potential to emit (PTE) 100 tons per year (tpy) or more of any attainment pollutant regulated under the Clean Air Act (CAA), or any other source type

Navajo Generating Station PSD Permit AZ 08-01 Draft Ambient Air Quality Impact Report, October 2008 6 of 17which emits or has the potential to emit such pollutants in amounts equal to or greater than 250 tpy. NGS belongs to one of the 28 li sted source categories (i .e., fossil fuel-fired electric plants with heat inputs of more than 250 MMBtu /hr). It is considered a grandfathered major stationary source becau se the PTE for criteri a pollutants exceeds 100 tpy.

Under PSD, modifications at existing major sta tionary sources are deemed “major” if the modification results in a significant emissi on increase and a significant net emissions increase for any pollutant subjec t to PSD. See 40 CFR 52.21(a)(2)(iv)( a ). As shown in Table 3, the net emissions increase associated with the proposed changes at NGS exceed the PSD significance thresholds for CO. In addition, because no changes are being made to the facility’s design or capacity, this project is not expected to increase emissions of any other criteria pollutants. Therefore, the proposed project constitutes a major modification only for CO and the foll owing PSD requirements must be met:

• Application of Best Ava ilable Control Technology;

• Analysis of ambient air quali ty impacts from the project;

• Analysis of air quality and visibi lity impacts on Class I areas; and

• Analysis of impacts on soils and vegetation.

Table 3. Net emissions increase and PSD applicability Boiler

Unit Pollutant Net emissions increase 1 (tpy) PSD Significance Threshold (tpy) Triggers PSD?

NO x -(7,462) 40 No 1 CO 12,190 100 Yes NO x -(7,462) 40 No 2 CO 12,190 100 Yes NO x -(7,462) 40 No 3 CO 12,190 100 Yes

1 Net emissions increase is calculated per 40 CFR 52.21(b)(3) (see Appendix A for detailed calculations).

VI. BEST AVAILABLE CONTROL TECHNOLOGY

PSD regulations require that a Best Availa ble Control Technology (BACT) determination be made for each pollutant subject to PSD re view. Section 169(3) of the CAA defines BACT as follows:

The term "best available control tech nology" means an emission limitation based on the maximum degree of reduction of each pollutant subject to regulation under the Clean Air Act emitted from or which results from any major emitting facility. The permitting authority, on a case-by-cas e basis, taking into account energy, environmental, and economic impacts and other costs, makes a BACT determination through applic ation of processes and av ailable methods, systems, and techniques, including fuel cleani ng or treatment or innovative fuel combustion techniques for control of each such pollutant. In no event shall application of BACT result in emissions of any pollutant which will exceed the

Navajo Generating Station PSD Permit AZ 08-01 Draft Ambient Air Quality Impact Report, October 2008 7 of 17emissions allowed by any applicable sta ndard established pursuant to section 7411 (NSPS) or 7412 (NESHAP) of the Clean Air Act.

For attainment pollutants being regulated in a PSD permit, EPA evaluates emissions control requirements through a “top-down” BACT determination process. In brief, the top-down process involves ranki ng all available cont rol technologies in descending order of control effectiveness. EPA first examin es the most stringent technology. That technology is established as BACT unless it is demonstrated that technical considerations, or energy, environmental, or economic impacts justify a conclusion that the most stringent technology is not achievable for the case at hand. If the most stringent technology is eliminated, then the next most stringent option is evaluated until BACT is determined. The top-down BACT analysis is a case-by-case exercise for the particular source under evaluation. In summary, the five steps involved in a top-down BACT evaluation are:

1. Identify all available control options w ith practical potential for application to the specific emission unit for the re gulated pollutant under evaluation; 2. Eliminate technically inf easible technology options; 3. Rank remaining control technolog ies by control effectiveness; 4. Evaluate the most effective control al ternative and document results; if top option is not selected as BACT, evaluate next most effective control option; and 5. Select BACT, which will be the most stringent technology not rejected based on technical, energy, environmental, and economic considerations.

The applicant submitted a top-down BACT analysis for CO and proposed CO BACT emission limitations based on the analysis. EP A independently evaluated the information that SRP submitted and considered the following materials in identifying and evaluating available control technologies for pulverized coal-fired boilers: an EPA spreadsheet of recently permitted and proposed coal-fired power plants and EP A’s RACT/BACT/LAER Clearinghouse (RBLC). EPA’s BACT evaluation for CO emissions associated with the Low-NO x Burner Project at the Navajo Gene rating Station is discussed below.

BACT for CO Emissions
Step 1 – Identify All Available Control Technologies

The following control technologies were iden tified for the control of CO emissions from pulverized coal-fired boilers: catal ytic oxidation, ther mal oxidation, and good combustion practices.

Step 2 – Eliminate all technically infeasible control technologies

Catalytic Oxidation

Catalytic oxidation is the technology that ha s been used to obtain the most stringent control level for CO from na tural gas-fired turbine combus tion units. This technology

Navajo Generating Station PSD Permit AZ 08-01 Draft Ambient Air Quality Impact Report, October 2008 8 of 17has never been applied to a coal-fired unit. It is evaluated here to determine if it could be considered feasible technology for a pplication to NGS’ pulverized coal-fired boilers. In this alternative, a catalyst would be situated in the flue gas stream to lower the activation energy required to convert products of incomplete combustion (CO and VOC) in the presence of oxygen (O 2 ) to carbon dioxide and water. The catalyst permits combination of the reactant species at lower gas temperatures and residence times than would be required for uncatalyzed oxidation.

The catalyst would have to be located at a point where the gas temperature is within an acceptable range. The effective temperat ure range for CO oxidation is between 600 o F and about 1,000 o F. Catalyst non-selectivity is a problem for sulfur containing fuels such as coal. Catalysts promote oxidation of SO 2 to SO 3 as well as CO to CO 2
. The amount of SO 2 conversion is a function of temperature and catalyst design. Under optimum conditions, formation of SO 3 can be minimized to 5% of inlet SO 2
. This level of conversion would result in a large collate ral increase in H 2 SO 4 emissions which aside from the increased ambient air impacts, could result in unacceptable amounts of corrosion to the fa bric filter particulate collector, air preheater, ductwork and stack.

Because of this technical issue, oxidation catalysts cannot feasibly be applied to NGS’ coal-fired boilers. Thus , EPA has determined that oxidation catalysts are technically infeasible for application to the coal-fired boilers at the NGS.

Thermal Oxidation

Thermal oxidation would involve injecting addi tional air into the fl ue gas and heating the oxygen enriched mixture to approximately 1,500 o F to oxidize CO to carbon dioxide. However, since the combustion of the reheat fuel would also result in CO emissions, there is no evidence that ther mal oxidation would result in any CO emission reductions. Since thermal oxidati on has never been demonstrated on a coalfired boiler, and because there is no ev idence that it could reduce CO emissions, thermal oxidation is not considered by th e EPA to be a technically feasible CO control technology for NGS ’ coal-fired boilers.

Combustion Practices

Combustion control refers to controlli ng emissions of CO through the design and operation of the boiler in a manner so as to limit CO formation. In general, a combustion control system seeks to main tain the proper conditions to ensure complete combustion through one or more of the following operation design features: providing sufficient excess air, staged combus tion to complete burn out of products of incomplete combustion, sufficient reside nce time, and good mixing. All of these factors also tend to reduce emissions of CO . However, this process must be optimized with the efforts to reduce NO x emissions, which may increase when steps to lower CO are taken.

Navajo Generating Station PSD Permit AZ 08-01 Draft Ambient Air Quality Impact Report, October 2008 9 of 17Step 3 – Rank Control Effectiveness of Technically Feasible Control Options

Based on the above analysis, good combustion pr actices (GCP) is the only technically feasible CO control technology for NGS’ pul verized coal-fired boilers. GCP or combustion controls generally include the following components:

• Good air/fuel mixing in the combustion zone

• High temperatures and low oxygen levels in the primary combustion zone

• Overall excess oxygen levels high en ough to complete combustion while maximizing boiler thermal efficiency

• Sufficient residence time to complete combustion

Step 4 – Evaluate the Most Effective Controls
Because no specific CO control technologi es beyond good combustion practices were identified as part of this BACT anal ysis, additional evaluation is unnecessary.
Step 5 – Select BACT for CO Emissions
Listings in the RBLC indicate that recen t CO BACT emission limits for new coalfired boilers using GCP are generally 0.15 lb/MMBtu. Fo r existing boilers being retrofitted with LNBs or other NO x controls, CO BACT limits vary considerably from 0.15 lb/MMBtu (30-day average) to 1.63 lb/MMB tu (3-hour average) . This variability is due to several factors such as furnace configurations, excess air, staging of the combustion process, coal type, etc.

Because the boilers at NGS will be retrofit ted rather than being originally designed for optimum combustion as with new units, it is uncertain whether the retrofitted units can achieve the same CO emission rates as new boilers. In addition, NGS is designed as a divided furnace which means it is comp rised of two furnace cells that share a common furnace wall. A divided furnace contains eight windboxes (eight burner fronts) which are located on the front and re ar of the unit and off the furnace corners. Due to the geometry and aerodynamics of a divided furnace, the CO emissions typically are higher than those of a traditional four-cornere d unit, all other parameters being equal.

The rank of coal can also have an effect on CO emissions. The boilers at the NGS are fueled primarily with Western Bitumi nous coal from the Peabody Western Coal Company’s Kayenta Mine. When reducing NO x emissions, CO emissions can be more difficult to control with this rank of coal.
Rather than setting the CO emission rates equal to the lowest proposed BACT limits for new units in the RBLC, SRP has proposed a rate of 0.42 lb/MMBtu, based on a rolling 30-day average. In order to ensu re that SRP will be emitting the lowest possible CO emission limit that the units can practically achieve on a continuous basis, EPA incorporated the proposed em ission rate into th e permit along with language that will allow this limit to be ra tcheted down after the first 18 months of operation (“Demonstration Period”) once th e LNB/SOFA systems were installed. After the Demonstration Period for each boiler, SRP will submit to EPA a written

Navajo Generating Station PSD Permit AZ 08-01 Draft Ambient Air Quality Impact Report, October 2008 10 of 17report together with CO CEMS data show ing actual CO emissions which evaluates whether a lower CO emissions limit can be consistently and reasonably achieved while maintaining NO x emission levels at or be low 0.24 lb/MMbtu on a 30-day rolling average. The report shall provide all supporting document ation identifying the combustion characteristics that impact CO emissions and evaluate the potential for reducing the CO emission limit to a level that can be consistently and reasonably met. Within 30 days after EPA concludes in writi ng that the report is acceptable, SRP shall apply for a permit modification to decrease the CO emission limit.
Based on the analysis above, we conclude that the use of good combustion practices is the best available control technology fo r CO emissions for Boiler Units 1, 2, and 3 given the facility’s specific coal a nd furnace design parameters. This control technology can achieve a CO emission rate of 0.42 lb/MMBtu based on a 30-day rolling average, excluding periods of star tup and shutdown. For periods of startup and shutdown, BACT is also good combustion practices.

VII. AIR QUALITY IMPACTS

The PSD regulations require an air quality impact analysis to estimate the effects of the proposed project on ambient air quality. Fo r all regulated pollutants emitted in significant quantities, the analysis must cons ider whether the propos ed project will cause a violation of the National Ambient Air Qual ity Standards (NAAQS) and the applicable PSD increments; certain additional impact s must also be assessed. Below are descriptions of the general approach, air quality model selection, significant impact levels, and the project's compliance with am bient air quality sta ndards. SRP conducted modeling of the project via a contractor, RT P Environmental Associates, and submitted a modeling report and protocol with the perm it application in April 2008 (revised July 2008).

The proposed project will result in a significant increase in CO emissions. NO x emissions will decrease, and other pollutants would have negligible changes. The project's ambient impact is above the significant impact level for CO, triggering the requirement for a cumulative impact analysis. The cumulative impact analysis SRP submitted demonstrated that the project would not cause or contribute to a viol ation of the 1-hour or 8-hour CO NAAQS.

EPA's conclusion is that SRP used appr opriate modeling procedures and followed applicable guidance, and demonstrated that the proposed project would not violate any NAAQS or PSD increment, and will not have an adverse impact on any Air Quality Related Value (AQRV) at any Class I area.

A. Meteorological and Background Ambient Air Quality Data The ambient impact analysis requires represen tative meteorological data, either 5 years of National Weather Service (NWS) data, or a year of on-site data. SRP used upper air data from Desert Rock, NV, and surface data from the nearby NWS station at Page Municipal Airport. Desert Rock is more distant than the alternative Fl agstaff, AZ upper air station,

Navajo Generating Station PSD Permit AZ 08-01 Draft Ambient Air Quality Impact Report, October 2008 11 of 17but is more representative since the Flagstaff el evation is substantial different than that at the project site. Missing data at Page caused each of the 5 most recent years to be somewhat below the 90% completeness EPA threshold for acceptance. To compensate, SRP used an additional two years of data so that the total number of hours was more than would be available for 5 years at 100% comple teness. SRP also checked that the missing hours were distributed roughly evenly between the different hours of the day and months of the year. Thus a full range of meteorologi cal conditions is repres ented, including those with potentially high modeled impact. EPA believes that this meteorological data is representative, and that the processing procedures meet the goals of EPA guidelines for meteorological data.

The ambient impact analysis also requires representative background air quality data, to add to modeled values for comparison to the NAAQS. No CO mon itor is close by, but the Page area is relatively pristine for CO; el evated CO levels are typically driven by high traffic density in large urban areas. SR P used ambient data from Maricopa County, which up until a few years ago had CO NAAQS violations; background values were 8931 μg/m 3 for the 1-hour CO NAAQS, and 6069 μg/m 3 for the 8-hour CO NAAQS. The use of these values is an extremely conservati ve approach that tends to overstate the cumulative impact of the proposed project.

B. Modeling Methodology

SRP modeled NGS with AERMOD, the standa rd EPA-recommended air quality model for permitting, with default regulatory options se lected. In addition to the meteorological inputs discussed above, an air quality m odel needs inputs characterizing emissions sources. SRP modeled the proposed pr oject's emissions assuming 1500 ppm CO concentration rates from each boiler, which was based on estimates by a low-NO x burner vendor that SRP consulted, plus 50% for cons ervatism. Based on an "F factor" of 9780 scf/MMBtu for CO from bituminous coal (40 CFR §60, Appendix A-7, Method 19, table 19-2), this corresponds to CO emission rates of 1.24 lb/MMBtu, or 9610 lb/hr. (This is substantially higher than, t hough not directly related to, the proposed permit limit of 0.42 lb/MMBtu.)

SRP also used inputs for the proposed proj ect's stack height, temperature, and exit velocity, which determine the pollutant pl ume's buoyancy and momentum, and hence its distance from the ground. Because these fact ors vary with the ope rating load of the source, SRP performed load screening, i.e. in itial modeling to determine the worst case. SRP used AERMOD to estimate impacts unde r 50%, 75% and 100% load conditions; the highest impact occurred for 100% load, which was then used for the rest of the modeling.

Nearby buildings can cause downwash, in whic h a pollutant plume is pulled down into the building's wake, leading to high pollutant co ncentrations. SRP simulated this with the appropriate AERMOD model op tions, including effective bu ilding dimensions from the BPIP software EPA provides for the purpose.

Navajo Generating Station PSD Permit AZ 08-01 Draft Ambient Air Quality Impact Report, October 2008 12 of 17Land surface characteristics, such as roughness, affect local meteorology. SRP used EPA’s AERSURFACE program to prepar e AERMET surface inputs, based on USGS National Land Cover Data. Land west of the Page, AZ meteorological station is Commercial/Industrial, while land to the east is principa lly shrubland, with some grassland. Terrain elevati on data from USGS Digital Elevation Model files was processed through AERMAP, which computes effective heights us ed by AERMOD to help determine how the pollutant plum e interacts with terrain features.

The final inputs are the locations, or receptors , at which the model will compute pollutant concentrations. SRP used receptors out to 40 km from the source, and additional sets of receptors that are progressively more closely spaced nearer the source, and also fence line receptors, the closest locations to which the general public has access. The receptors had 100 m spacing out to 2.5 km, 200 m spacing out to 3.5 km, 50 0 m spacing out to 6.5 km, 1 km spacing out to 20 km, and 2 km spaci ng out to 40 km. To ensure the maximum concentration was found, SRP also performe d additional modeling on a fine grid with 100 m spacing centered near the maximum f ound on the regular grid. Because 100 m spacing is somewhat sparse for a fine grid, EPA remodeled the area of greatest impact using 25 meters (m) receptor spacing.

C. NAAQS Compliance

The proposed project's modeled impacts ar e shown in Table 4 below. The PSD regulations do not allow a projec t to cause or contribute to a violation of the NAAQS or of the PSD increment. EPA interprets this standard to be met when the applicant can show that it will not make a “significant” co ntribution to a violation of a NAAQS or PSD increment. That is, the applicant must show that its own impact is below the Significant Impact Level (SIL), or else show that there is no violation at locations where its impact is above the SIL. The proposed project's modeled impacts from CO exceeded the SIL, triggering the requirement for a cumulative analysis, which includes other, nearby sources. However, examination of emission i nventories for nearby counties showed there were no additional sources to include. Thus, SRP used the same modeling results as for the proposed project by itself. While SRP could have used the 2 nd highest value for comparing to the NAAQS, SRP continued to use the 1 st high value that was used in comparing to the SIL, a conservative appro ach. As mentioned above, EPA remodeled the area of greatest impact using 25 m receptor spacing (Table 5). For most of the seven modeled years the impacts were nearly th e same as the SRP result, but for the 2005 modeled year there was a 5% increase. Cumulative impact including background concentrations increased less than 3%.SRP's modeling analysis de monstrated that the proposed project would remain below both the 1-hour and 8-hour CO NAAQS.

Navajo Generating Station PSD Permit AZ 08-01 Draft Ambient Air Quality Impact Report, October 2008 13 of 17Table 4. Modeled maximum project impacts using SRP modeling Maximum Predicted Air Quality Impa cts from the Proposed Project (all values in μg/m 3 )

Pollutant Averaging Period Modeled Impact Significant Impact Level (SIL) Monitored Background Total Concentration NAAQS

1-hour 10,486 2000 8,931 19,417 40,000 CO 8-hour 1,749 500 6,069 7,818 10,000

Table 5. Modeled maximum project im pacts, including 25 m fine grid Maximum Predicted Air Quality Impa cts from the Proposed Project (all values in μg/m 3 )

Pollutant Averaging Period Modeled Impact Significant Impact Level (SIL) Monitored Background Total Concentration NAAQS

1-hour 11,062 2000 8,931 19,993 40,000 CO 8-hour 1,844 500 6,069 7,913 10,000

D. Increment Consumption Analysis and Increment Compliance

There is no PSD increment defined for CO, so no analysis is required.

VIII. ADDITIONAL IMPACT ANALYSIS

In addition to assessing the ambient air qua lity impacts expected from a proposed new source or modification, the PSD regulations require that certain other impacts be considered. These include impacts on grow th, soils and vegetation, and visibility.

A. Growth Analysis

Since this proposed project is a retrofit to an existing source, with no changes in operations, there will be no change in the size of the work force, and no expected growth impacts.

B. Soils and Vegetation Analysis

The PSD regulations require anal ysis of air quality impacts on sensitive vegetation types, with significant commercial or recreational va lue, and sensitive types of soil. The SRP permit application stated that comparison to the NAAQS themselves can be used to assess such impacts. However, the NAAQS fo r CO are primary NAAQS, aimed solely at protecting human health. There is no s econdary NAAQS, which would be aimed at protecting "welfare", includi ng plants. The only availabl e guidance for conducting the soils and vegetation analysis is in A Screening Procedure for th e Impacts of Air Pollution

Navajo Generating Station PSD Permit AZ 08-01 Draft Ambient Air Quality Impact Report, October 2008 14 of 17Sources on Plants, Soils, and Animals (EPA 1980). This documen t gives a CO screening level of 1,800,000 μg/m 3 , over a one-week averaging time. The maximum cumulative impact of the project was 19,417 μg/m 3 with a 1-hour averaging time, far below the screening level. Thus, even though compari ng a 1-hour average to a weekly level is a very conservative procedure, the project passes the screening test.

C. Visibility Impairment and Air Quality Related Value Analysis

Since CO has a negligible contribution to visibility impairment, no visibility analysis is required. EPA is not otherwise aware of any other Class I Area AQRV that could be affected by CO emissions. A visibility improve ment is expected from the installation of the LNB/SOFA. An analysis provided by SRP for the visibility improvement as a result of the burner modifications can be f ound in the BART regulatory docket at: http://www.regulations.gov/fdmspublic/c omponent/main?main=DocketDetail&d=EPAR09-OAR-2008-0454

IX. ENDANGERED SPECIES

Pursuant to Section 7 of the Endangered Species Act (ESA), 16 U.S.C. § 1536, and its implementing regulations at 50 CFR Part 402, EP A is required to ensure that any action authorized, funded, or carried out by EPA is not likely to jeopardize the continued existence of any endangered or threatened spec ies or result in the de struction or adverse modification of such species’ de signated critical habitat.

For this proposed project, SRP submitted an “Endangered Species Act Analysis” to EPA Region 9 in April 2008 (revised July 2008). Th e proposed project will occur on the active plant site which is al ready a developed industr ial area, and it is exp ected that the species identified in the analysis generally avoid human contact and thus avoi d the facility area. EPA reviewed the analysis and has initiated in formal consultation with the U.S. Fish and Wildlife Service. EPA expects to conclude th e consultation process informally before a final decision is made to issue the permit.

X. CONCLUSION AND ACTION

Based on the information supplied by SRP, our review of the analys es contained in the permit application, and our independen t evaluation provide d above, it is our determination that the proposed project will employ BACT and complies with PSD permitting requirements. Therefore, EPA is proposing to issue SRP a PSD Permit (No. AZ 08-01) allowing a modification at the Na vajo Generating Sta tion. This permit is subject to review and comments. A final decisi on on issuance of the permit will be made by EPA after considering comments received during the public co mment period and upon completion of the ESA consultation process.

Navajo Generating Station PSD Permit AZ 08-01 Draft Ambient Air Quality Impact Report, October 2008 15 of 17

# APPENDIX A Emissions Calculations

Navajo Generating Station PSD Permit AZ 08-01 Draft Ambient Air Quality Impact Report, October 2008 16 of 17Navajo Generating Station PSD Permit AZ 08-01 Draft Ambient Air Quality Impact Report, October 2008 17 of 17