# Correspondence Management System Control Number: AX-12-000-4621 Printing Date: March 12, 2012 06:52:39 Citizen Information 

# CMS

CitizenlOriginator: Modeer, David V Organization: Central Arizona Project Address: 23636 North Seventh Street, Phoenix, AZ 85024 Constituent: N/A Committee: N/A Sub-Committee: N/A


### Control Information Control Number: AX-i2-000-4621 Alternate Number: N/A Status: Pending Closed Date: N/A Due Date: Mar26, 2012 #ofExtensions: 0 LetterDate: Mar 8, 2012 Received Date: Mar 12, 2012 Addressee: AD-Administrator Addressee Org: EPA ContactType: FAX (Facsimile) Priority Code: Normal Signature: DX-Direct Reply Signature Date: N/A File Code: 404-141-02-01_141_b Controlled and MajorCorr. Record copy ofthe offices ofDivision Directors and other personnel. Subject: Daily Reading File- Central ArizonaWaterConservation District letterconcerning potential change in focus ofon-going NGS analysis Instructions: DX-Respond directlyto this citizens questions, statements, orconcerns Instruction Note: N/A General Notes: N/A CC: OAR

- Office ofAir and Radiation

-- Immediate Office OEAEE

- Office ofExternal Affairs and Environmental Education OITA

- Office ofInternational and Tribal Affairs OW

- Office ofWater

-- Immediate Office


### Lead Information Lead Author: Frances Kwok Office: R9 Due Date: Mar26, 2012 Assigned Date: Mar 12, 2012 Complete Date: N/A Instruction: DX-Respond directly to this citizen’s questions, statements, orconcerns Lead Assignments: Assigner Office Assignee Assigned Date Due Date CompleteDate Ken Labbe OEX R9 Mar 12, 2012 Mar26, 2012 N/A Instruction: OX-Respond directlyto this citizen’s questions, statements, orconcerns 

### Supporting Information Supporting Author: N/A

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# Correspondence Management System Control Number: AX-12-000-4621 Printing Date: March 12, 2012 06:52:39

No Record Found. 

### History Actipn By Ken Labbe Frances Kwok Frances Kwok Office QEX R9 R9 

### Action Assign R9 as lead office Acceptedthe group assignment 

# jTake task Date Mar 12, 2012 Mar 12, 2012 Mar 12, 2012


### Comments Commentator iComment 

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### Supporting Assignments: 

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Assignor 

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Page 2 of2O3O8J2(12 THU d:41 FAX 623 869 2332 Central Arizona Project OCI/OO3

P.O. Box43020- Phoenix, AZ85080-3020

‘‘‘ 23636 North Seventh Street • Phoenix,AZ 85024

CENTRAl. ARIZONA PROJECT 623-869-2333 • www.cap-az.corn

March 8, 2012

Via USPS andFacsimile: 202-501-1450 The Honorable Lisa PerezJackson United States Environmental Protection Agency Arel Rios Federal Building 1200 Pennsylvania, Avenue Washington, DC 20460 Via USPS andFacsimile:202-208-5048 The Honorable Kenneth Lee Salazar United States DepartmentofInterior 1849 C Street, NW, Mail Stop 7329 Washington, DC 20240 Via LISPS andFacsimile: 202-586-4403 The Honorable StevenChu United States DepartmentofEnergy Forrestal Building 1000 IndependenceAvenue, SW Washington, DC 20585-1000 DearAdministratoriackson, Secretary Salazar, and Secretary Chu: I am the General Manager of the Central Arizona Water Conservation District (CAWCD). CAWCD manages the Central Arizona Project (CAP), a critical water delivery system supporting over 80% of Arizona’s population and economic activity. Because the Navajo Generating Station (NGS) supplies over 90% ofthe powerrequired to operate the CAP, I read with great concern AdministratorJackson’s letter ofFebruary 16, 2012 to Secretaries Salazar and Chu. I am writingto detail those concerns and point out important information relevant to the NGS and its future in the context of Administrator Jackson’s letter. The CAP and NGS are inexorably linked. The Colorado River Basin Project Act of 1968 authorized both construction ofthe CAP and U.S participation in a coal-fired power plantto provide powerfor pumping renewable Colorado River water into the state of Arizona through the CAP system. The NGS actually resulted from an environmental compromise in response to the potential of building additional dams along the Colorado River nearthe Grand Canyon. The United States acquired an entitlementto 24.3% of the output of NGS for CAP purposes. Any power in excess ofthe power requirements ofCAP is sold to help repay the construction costs of the CAP and to help fund the costs of Indian water rightsTHU l4 42 FAX 623 869 2332 Central Arizona Project OO2/OO3 g I

The Honorable Lisa PerezJackson The Honorable Kenneth Lee Salazar The Honorable Steven Chu March8, 2012 Page 2

settlements in Arizona. Anything that affects the operation and the cost of NGS has significant and far reachingeffects onCAP, the federalgovernment, andthe people ofArizona. CAWCD’s principal concern with the letteristhatit suggests a potential change infocus ofthe on-going, and as yet incomplete, NGS analysis. As you are aware, CAWCD and other affected parties are actively participating in the BestAvailable RetrofitTechnology (BART) rulemaking process initiated bythe EPA in August 2009. Indeed, the letter refers to implementation ofthe Regional Haze Program, BART, and its focus on visibility improvements in national parks and wilderness areas. However, the letter quickly leaves this issue behind, focusing instead on “human health” and “advancing our nation’s renewable energy future.” While these are always importantgoals, the issue currently before the EPA is the BART rulemaking process. With so much at stake for CAP and the people of Arizona, including Tribal communities, completion of this rulemaking process is critical so that the NGS owners can make an informeddecision regardingthe futureofthe plant.
In recent congressional testimony, Administrator Jackson indicated that a decision on BART for NGS would be issued by late summer. Withthe publication ofthe portion ofthe National Renewable Energy Laboratory’s NGS study relating to the five statutory BART factors, there would appearto be sufficient information available now upon which to base a decision. That study is inconclusive as to whether additional NO,, emissions control technology at NGS would produce any visibility impacts detectible by the human eye in the Class I areas proximate to the plant. Consequently, the existing pollution control system at NGS, which is the best available for reducing SO 2 coupled with Low NO,, Burners with Separated Over Fire Air (LNBISOFA), oughtto be considered as the best available control technology at this time. Should such retrofittechnology as Selective Catalytic Reduction (SCR) or SCR plus baghouses be required at a cost of about $500 million to $1.13 billion, substantial negative impacts to Tribal, agricultural, and municipal and industrial users ofCAPwaterwill occur. In addition, should such retrofit also be required before key uncertainties are resolved (such as the plant site lease, transmission and transportation easements and rights of way, water supply arid coal agreements, etc.), this decision would likelytriggerthe permanent shutdown ofNGS by its owners. That result is untenablefor CAWCD and operation ofthe CAP. In any event, we respectfully requestthatthe EPA make a determination on the BARTquestion as quicklyas possible. CAWCD is also concerned that the letter appears to be leading toward a near-term renewable energy option forNGS. The National Renewable Energy Laboratoryis preparedto look at renewable energy and transition issues in greaterdetail through a more inclusive second phase ofthe alternatives and impact study on NGS AirVisibility Regulations. Itis most appropriate that such a review be conducted by NREL in a manner that is consistent with the first phase and includes participation of all of the affected parties. As it stands, renewable energy sources cannotreplace the CAP’s needs noworinthe near(and perhaps distant) future. CAP requires a base load supply that renewable energy alternatives currently cannot provide. Therefore, the EPA’s focus must remain on issuing a BART determination as soon as possible.U/Ui5/.U1I THU 14:42 FAX 623 869 2332 Central Arizona Project

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The Honorable Lisa PerezJackson The Honorable Kenneth Lee Salazar The Honorable Steven Chu March 8, 2012 Page 3
Finally, the Administrators letter makes several references to the “tribes, t

’ including protecting their economic interests and “mitigating the impacts” upon them. With regard to the ultimate outcome on NGS, different tribes will be affected in different ways. As discussed in the NREL study and CAWCD’s comments thereto (both the initial two-page comments and the subsequent letter sentto EPA Region 9 AdministratorJared lumenfeld and InteriorDeputy Secretary David Hayes), the effects that changes to NGS, including attempts to incorporate renewable energy alternatives, would have on tribes will vary depending on whether the tribe is the Navajo Nation, the Hopi Tribe, tribes that have settled water rights claims such as the Gila River Indian Community, or tribes that have yet to settle their claims. Nonetheless, there is no disputing the overall negative effect of shutting down NGS or requiring expensive retrofits. Moreover, ifrenewable energy eventually becomes a technically and economically feasible alternative to power the CAP, it is uncertain if the plant owners would participate in development of one or more renewable energy alternatives specifically for NGS rather than participatingin otherprojects thatmay meettheirindividual needs, AtCAWCD, we are focused on providing waterto Arizona in the most efficient and economical manner, while preservingourothergreat natural resources. This service requires balancing manyconsiderations. From a visibility perspective, we believe that balance is achieved by the current LNB/SOFA system at NGS. Weencouragea promptresolutiontothe BARTprocess. Thank ou foryourconsid ration, 

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DavidV. Modeer General Manager