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RONALD J. TENPAS
 

Assistant Attorney General 


Environment and Natural Resources Division 


United States Department of Justice
 

Washington, DC 20530
 

W. BENJAMIN FISHEROW
 

Deputy Chief
 

Environmental Enforcement Section
 

Environment and Natural Resources Division
 

United States Department of Justice
 

P.O. Box 7611, Ben Franklin Station
 

Washington, DC 20044-7611
 

Telephone: (202) 514-2750
 

E-mail: Benjamin.Fisherow@usdoj.gov
 

DIANE J. HUMETEWA
 

United States Attorney
 

SUE A. KLEIN
 

Assistant United States Attorney
 

Arizona Bar no. 11253
 

Two Renaissance Square
 

40 N. Central Avenue, Suite 1200
 

Phoenix, AZ 85004-4408
 

Telephone: (602) 514-7500
 

E-mail: sue.klein@usdoj.gov
 

Attorneys for Plaintiff 


United States of America
 

UNITED STATES DISTRICT COURT
 

FOR THE DISTRICT OF ARIZONA
 

UNITED STATES OF AMERICA, )

 ) 

Plaintiff, ) CIVIL ACTION NO.

v.

 ) 

) 2:08-cv-1479-JAT

 ) 

SALT RIVER PROJECT AGRICULTURAL ) CONSENT DECREE 

IMPROVEMENT AND POWER DISTRICT )

 ) 

Defendant. ) 

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TABLE OF CONTENTS
 

I. JURISDICTION AND VENUE .................. 5
 

II. APPLICABILITY ...................... 6
 

III. DEFINITIONS ....................... 7
 

IV. NOx EMISSION REDUCTIONS AND CONTROLS .......... 13 
 

V. SO2 EMISSION REDUCTIONS AND CONTROLS .......... 15 
 

VI. PM EMISSION REDUCTIONS AND CONTROLS .......... 21 
 

VII. PROHIBITION ON NETTING CREDITS OR OFFSETS ...... 26 
 

VIII. ENVIRONMENTAL PROJECTS ................ 27 
 

IX. CIVIL PENALTY ..................... 29 
 

X. RESOLUTION OF PAST CIVIL CLAIMS ............. 30 
 

XI. PERIODIC REPORTING ................... 30 
 

XII. REVIEW AND APPROVAL OF SUBMITTALS ........... 33 
 

XIII. STIPULATED PENALTIES ................. 33 
 

XIV. FORCE MAJEURE ..................... 44 
 

XV. DISPUTE RESOLUTION ................... 47 
 

XVI. PERMITS ........................ 49 
 

XVII. INFORMATION COLLECTION AND RETENTION ......... 52 
 

XVIII. NOTICES ....................... 53 
 

XIX. SALES OR TRANSFERS OF OWNERSHIP INTERESTS ....... 55 
 

XX. EFFECTIVE DATE ..................... 56 
 

XXI. RETENTION OF JURISDICTION ............... 56 
 

XXII. MODIFICATION ..................... 57 
 

XXIII. GENERAL PROVISIONS ................. 57 
 

XXIV. SIGNATORIES AND SERVICE ............... 59 
 

XXV. PUBLIC COMMENT ..................... 60 
 

XXVI. CONDITIONAL TERMINATION OF ENFORCEMENT UNDER CONSENT
 

DECREE ........................... 60 
 

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XXVII. FINAL JUDGMENT . . . . . . . . . . . . . . . . . . . 61 
 

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WHEREAS, Plaintiff, the United States of America (“the
 

United States”), on behalf of the United States Environmental
 

Protection Agency (“EPA”) is concurrently filing a complaint for
 

injunctive relief and civil penalties pursuant to Sections
 

113(b)(2) and 167 of the Clean Air Act (the “Act”), 42 U.S.C.
 

§§ 7413(b)(2) and 7477, alleging that Defendant, Salt River
 

Project Agricultural Improvement and Power District (“SRP”) has
 

undertaken construction projects at a major emitting facility in
 

violation of the Prevention of Significant Deterioration (“PSD”)
 

provisions of Part C of Subchapter I of the Act, 42 U.S.C.
 

§§ 7470-7492, and in violation of the federally approved and
 

enforceable Arizona State Implementation Plan (“SIP”); 


WHEREAS, in its complaint, the United States alleges, inter
 

alia, that SRP failed to obtain the necessary permits and install
 

the controls necessary under the Act to reduce sulfur dioxide
 

(“SO2”), oxides of nitrogen (“NOx”), and particulate matter
 

(“PM”), and that SRP failed to obtain an operating permit under
 

Title V of the Act that reflects applicable requirements imposed
 

under Part C of Subchapter I of the Act for its Coronado
 

Generating Station (“CGS”) located near St. Johns, Arizona;
 

WHEREAS, the complaint alleges claims upon which relief can
 

be granted against SRP under Sections 113 and 167 of the Act, 42
 

U.S.C. §§ 7413 and 7477;
 

WHEREAS, the United States provided SRP and the State of
 

Arizona actual notice of alleged violations in accordance with
 

Section 113(a)(1) and (b) of the Act, 42 U.S.C. § 7413(a)(1) and
 

(b);
 

WHEREAS, the United States and SRP (collectively, the
 

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“Parties”) have agreed that settlement of this action is in the
 

best interest of the Parties and in the public interest, and that
 

entry of this Consent Decree without further litigation is the
 

most appropriate means of resolving this matter;
 

WHEREAS, the Parties recognize, and the Court by entering
 

this Consent Decree finds, that this Consent Decree has been
 

negotiated in good faith and at arm’s length and that this
 

Consent Decree is fair, reasonable, consistent with the goals of
 

the Act, and in the public interest;
 

WHEREAS, SRP has cooperated in the resolution of this
 

matter;
 

WHEREAS, SRP denies the violations alleged in the complaint,
 

and nothing herein shall constitute an admission of liability;
 

WHEREAS, SRP maintains that its agreement in this Consent
 

Decree to install, correlate, maintain, and operate PM CEMS shall
 

not prevent SRP in any future proceedings from challenging the
 

relationship between the data generated from such PM CEMS,
 

including the averaging period for which such data is reported
 

pursuant to Paragraph 71, and the results of performance tests
 

for PM (e.g., Method 5, 5B, 5I, or 17); and 


WHEREAS, the Parties have consented to entry of this Consent
 

Decree without trial of any issues;
 

NOW, THEREFORE, without any admission of fact or law, it is
 

hereby ORDERED, ADJUDGED, AND DECREED as follows:
 

I. JURISDICTION AND VENUE
 

1. This Court has jurisdiction over this action, the
 

subject matter herein, and the Parties consenting hereto,
 

pursuant to 28 U.S.C. §§ 1331, 1345, 1355, and 1367, and pursuant
 

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to Sections 113 and 167 of the Act, 42 U.S.C. §§ 7413 and 7477. 


Venue is proper under Section 113(b) of the Act, 42 U.S.C.
 

§ 7413(b), and under 28 U.S.C. § 1391(b) and (c). Solely for the
 

purposes of this Consent Decree and the underlying complaint, and
 

for no other purpose, SRP waives all objections and defenses that
 

it may have to the Court’s jurisdiction over this action, to the
 

Court’s jurisdiction over SRP, and to venue in this district.
 

SRP consents to and shall not challenge entry of this Consent
 

Decree or this Court’s jurisdiction to enter and enforce this
 

Consent Decree. Except as expressly provided for herein, this
 

Consent Decree shall not create any rights in or obligations of 


any party other than the Parties to this Consent Decree. Except
 

as provided in Section XXV (Public Comment) of this Consent
 

Decree, the Parties consent to entry of this Consent Decree
 

without further notice.
 

II. APPLICABILITY
 

2. Upon entry, the provisions of this Consent Decree shall
 

apply to and be binding upon the Parties, their successors and
 

assigns, and upon SRP’s directors, officers, employees, servants
 

and agents solely in their capacities as such.
 

3. SRP shall provide a copy of this Consent Decree to all
 

vendors, suppliers, consultants, contractors, agents, and any
 

other company or other organization retained to perform any of
 

the work required by this Consent Decree. Notwithstanding any
 

retention of contractors, subcontractors, or agents to perform
 

any work required under this Consent Decree, SRP shall be
 

responsible for ensuring that all work is performed in accordance
 

with the requirements of this Consent Decree. In any action to
 

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enforce this Consent Decree, SRP shall not assert as a defense
 

the failure of its officers, directors, employees, servants,
 

agents, or contractors to take actions necessary to comply with
 

this Consent Decree, unless it is determined to be a Force
 

Majeure Event as governed by Section XIV of this Consent Decree.
 

III. DEFINITIONS
 

4. Every term expressly defined by this Section shall have
 

the meaning given that term herein. Every other term used in
 

this Consent Decree that is also a term used under the Act or in
 

a federal regulation implementing the Act shall mean in this
 

Consent Decree what such term means under the Act or those
 

regulations.
 

5. A “30-Day Rolling Average NOx Emission Rate” for a Unit
 

shall be expressed in lb/mmBtu and calculated in accordance with
 

the following procedure: first, sum the total pounds of NOx
 

emitted from the Unit during the current Unit Operating Day and
 

the previous twenty-nine (29) Unit Operating Days; second, sum
 

the total heat input to the Unit in mmBtu during the current Unit
 

Operating Day and the previous twenty-nine (29) Unit Operating
 

Days; and third, divide the total number of pounds of NOx emitted
 

during the thirty (30) Unit Operating Days by the total heat
 

input during the thirty (30) Unit Operating Days. A new 30-Day
 

Rolling Average NOx Emission Rate shall be calculated for each
 

new Unit Operating Day. Each 30-Day Rolling Average NOx Emission
 

Rate shall include all emissions that occur during all periods
 

within any Unit Operating Day, including emissions from startup,
 

shutdown, and malfunction.
 

6. A “365-Day Plant-Wide Rolling NOx Tonnage Limitation”
 

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means the limitation, as specified in this Consent Decree, on the
 

total number of tons of NOx emitted from CGS Units 1 and 2 during
 

a 365-day period beginning on June 1, 2014, and continuing each
 

day thereafter, and shall include all emissions during startup,
 

shutdown, and malfunction, unless the malfunction is determined
 

to be a Force Majeure Event as defined in Section XIV.
 

7. A “30-Day Rolling Average SO2 Removal Efficiency” means
 

the percent reduction in the mass of SO2 achieved by a Unit’s FGD
 

system over a thirty (30) Unit Operating Day period and shall be
 

calculated as follows: step one, sum the total pounds of SO2
 

emitted as measured at the outlet of the FGD system for the Unit
 

during the current Unit Operating Day and the previous
 

twenty-nine (29) Unit Operating Days as measured at the outlet of
 

the FGD system for that Unit; step two, sum the total pounds of
 

SO2 delivered to the inlet of the FGD system for the Unit during
 

the current Unit Operating Day and the previous twenty-nine (29)
 

Unit Operating Days as measured at the inlet to the FGD system
 

for that Unit (this shall be calculated by measuring the ratio of
 

the lb/mmBtu SO2 inlet to the lb/mmBtu SO2 outlet and multiplying
 

the outlet pounds of SO2 by that ratio); step three, subtract the
 

outlet SO2 emissions calculated in step one from the inlet SO2
 

emissions calculated in step two; step four, divide the remainder
 

calculated in step three by the inlet SO2 emissions calculated in
 

step two; and step five, multiply the quotient calculated in step
 

four by 100 to express as a percentage of removal efficiency. A
 

new 30-day Rolling Average SO2 Removal Efficiency shall be
 

calculated for each new Unit Operating Day, and shall include all
 

emissions that occur during all periods within each Unit
 

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Operating Day, including emissions from startup, shutdown, and
 

malfunction.
 

8. A “30-Day Rolling Average SO2 Emission Rate” for a Unit
 

shall be expressed in lb/mmBtu and calculated in accordance with
 

the following procedure: first, sum the total pounds of SO2
 

emitted from the Unit during the current Unit Operating Day and
 

the previous twenty-nine (29) Unit Operating Days; second, sum
 

the total heat input to the Unit in mmBtu during the current Unit
 

Operating Day and the previous twenty-nine (29) Unit Operating
 

Days; and third, divide the total number of pounds of SO2 emitted
 

during the thirty (30) Unit Operating Days by the total heat
 

input during the thirty (30) Unit Operating Days. A new 30-Day
 

Rolling Average SO2 Emission Rate shall be calculated for each
 

new Unit Operating Day. Each 30-Day Rolling Average SO2 Emission
 

Rate shall include all emissions that occur during all periods
 

within any Unit Operating Day, including emissions from startup,
 

shutdown, and malfunction. 


9. “Affirmative Defense,” as used in this Consent Decree,
 

means the Affirmative Defense approved by EPA into the Arizona
 

SIP Rule 18-2-310, “Affirmative Defenses for Excess Emissions Due
 

to Malfunction, Startup, and Shutdown,” which provides an owner
 

or operator of a source an Affirmative Defense in a civil or
 

administrative action, other than a judicial action for
 

injunctive relief, if the owner or operator of the source has
 

emissions in excess of an applicable emission limitation due to
 

malfunction, startup, or shutdown, has complied with the
 

reporting requirements of Rule 18-2-310.01, and satisfies
 

additional requirements of Rule 18-2-310.
 

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10. “Arizona DEQ” means the Arizona Department of
 

Environmental Quality.
 

11. “Arizona SIP” means the Arizona State Implementation
 

Plan, and any amendments thereto, as approved by EPA pursuant to
 

Section 110 of the Act, 42 U.S.C. § 7410.
 

12. “CEMS” or “Continuous Emission Monitoring System,”
 

means, for obligations involving the monitoring of NOx and SO2
 

emissions under this Consent Decree, the devices defined in 40
 

C.F.R. § 72.2, the inlet SO2 lb/mmBtu monitors, and the computer
 

system for recording, calculating, and storing data and equations
 

required by this Consent Decree.
 

13. “CGS” means SRP’s Coronado Generating Station
 

consisting of two Riley turbo-fired boilers (designated as Unit 1
 

and Unit 2) and related equipment, which is located near St.
 

Johns, Arizona.
 

14. “Clean Air Act” or “Act” means the federal Clean Air
 

Act, 42 U.S.C. §§ 7401-7671q, and its implementing regulations.
 

15. “Consent Decree” means this Consent Decree and the
 

Appendix hereto, which is incorporated into the Consent Decree.
 

16. “Day” means calendar day unless otherwise specified in
 

this Consent Decree.
 

17. “Electrostatic Precipitator” or “ESP” means a device
 

for removing particulate matter from combustion gases by
 

imparting an electric charge to the particles and then attracting
 

them to a metal plate or screen of opposite charge before the
 

combustion gases are exhausted to the atmosphere.
 

18. “Emission Rate” for a given pollutant means the number
 

of pounds of that pollutant emitted per million British thermal
 

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units of heat input (lb/mmBtu), measured in accordance with this
 

Consent Decree.
 

19. “EPA” means the United States Environmental Protection
 

Agency.
 

20. “Flue Gas Desulfurization System” or “FGD” means a
 

pollution control device that employs flue gas desulfurization
 

technology, including an absorber utilizing lime, fly ash, or
 

limestone slurry, for the reduction of sulfur dioxide emissions.
 

21. “Fossil Fuel” means any hydrocarbon fuel, including
 

coal, petroleum coke, petroleum oil, or natural gas.
 

22. “lb/mmBtu” means one pound of a pollutant per million
 

British thermal units of heat input.
 

23. “Low NOx Combustion System” means burners and
 

associated combustion air control equipment, including overfire
 

air, for combusting pulverized coal, which control mixing
 

characteristics of the pulverized coal and oxygen, lower the
 

combustion rate, lower oxygen concentration and heat temperature
 

during the initial phase of combustion, and thereby restrain the
 

formation of NOx created by both the nitrogen content of the
 

pulverized coal and by heat.
 

24. “Netting” shall mean the process of determining whether
 

a particular physical change or change in the method of operation
 

of a major stationary source results in a net emissions increase,
 

as that term is defined at 40 C.F.R. § 52.21(b)(3)(i) and at
 

Section R9-3-101 of the Arizona SIP.
 

25. “NOx” means oxides of nitrogen, measured in accordance
 

with the provisions of this Consent Decree.
 

26. “Ownership Interest” means part or all of SRP’s legal
 

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or equitable ownership interest in CGS.
 

27. “Parties” means the United States of America on behalf
 

of EPA and SRP. “Party” means one of the named “Parties.”
 

28. “PM” means total filterable particulate matter,
 

measured in accordance with the provisions of this Consent
 

Decree.
 

29. “PM CEMS” or “PM Continuous Emission Monitoring System”
 

means, for obligations involving the monitoring of PM emissions
 

under this Consent Decree, the equipment that samples, analyzes,
 

measures, and provides, by readings taken at frequent intervals,
 

an electronic and/or paper record of PM emissions.
 

30. “Prevention of Significant Deterioration” or “PSD”
 

means the prevention of significant deterioration of air quality
 

program under Part C of Subchapter I of the Clean Air Act, 42
 

U.S.C. §§ 7470 - 7492, and 40 C.F.R. § 52.21. It also includes
 

the prevention of significant deterioration of air quality
 

program as approved into the Arizona SIP, Arizona Administrative
 

Code R9-3-101, R9-3-301, R9-3-304, and R9-3-305.
 

31. “Project Dollars” means SRP’s expenditures and payments
 

incurred or made in carrying out the Environmental Projects
 

identified in Section VIII (Environmental Projects) of this
 

Consent Decree to the extent that such expenditures or payments
 

both: (a) comply with the requirements set forth in Section VIII
 

and Appendix A of this Consent Decree, and (b) constitute SRP’s
 

direct payments for such projects, or SRP’s external costs for
 

contractors, vendors, and equipment.
 

32. “Removal Efficiency” for a given pollutant means the
 

percentage of that pollutant removed by the applicable emission
 

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control device, measured in accordance with the provisions of
 

this Consent Decree.
 

33. “SCR” means a pollution control device for reducing NOx
 

emissions through the use of selective catalytic reduction
 

technology.
 

34. “SO2” means sulfur dioxide, measured in accordance with
 

the provisions of this Consent Decree.
 

35. “SO2 Allowance” means “allowance” of SO2 as defined at 


42 U.S.C. § 7651a(3): “an authorization, allocated to an
 

affected Unit by the Administrator of EPA under Subchapter IV of
 

the Act, to emit, during or after a specified calendar year, one
 

ton of sulfur dioxide.”
 

36. “State” means the State of Arizona.
 

37. “Super-Compliant SO2 Allowance” means an SO2 Allowance
 

attributable to reductions beyond the requirements of this
 

Consent Decree.
 

38. “Title V Permit” means the permit required of SRP’s CGS
 

under Subchapter V of the Act, 42 U.S.C. §§ 7661-7661e.
 

39. “Unit” means CGS Unit 1 or Unit 2.
 

40. “Unit Operating Day” means, for Unit 1, any calendar
 

day on which Unit 1 fires fossil fuel, and, for Unit 2, any
 

calendar day on which Unit 2 fires fossil fuel.
 

IV. NOx EMISSION REDUCTIONS AND CONTROLS
 

A. NOx Emission Controls
 

1. Low-NOx Combustion System Installation and Performance 


Requirements
 

41. SRP shall install a Low NOx Combustion System on one
 

Unit no later than June 1, 2009 and on the other Unit by no later
 

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than June 1, 2011. Commencing on the earlier of ninety (90) Unit
 

Operating Days or one hundred eighty (180) calendar days after
 

the Low NOx Combustion System installation date and continuing
 

thereafter, each Unit shall achieve and maintain a 30-Day Rolling
 

Average NOx Emission Rate of no greater than 0.320 lb/mmBtu.
 

2. SCR Installation and Performance Requirements
 

42. SRP shall install an SCR on one Unit no later than June
 

1, 2014. Beginning on June 1, 2014, and continuing thereafter,
 

SRP shall commence continuous operation of the SCR installed on
 

that Unit so as to achieve and maintain a 30-Day Rolling Average
 

NOx Emission Rate of no greater than 0.080 lb/mmBtu.
 

3. Continuous Operation of NOx Controls
 

43. SRP shall continuously operate each NOx control covered
 

under this Consent Decree at all times that the Unit it serves is
 

in operation, consistent with the technological limitations,
 

manufacturers’ specifications, and good engineering and
 

maintenance practices for minimizing emissions to the extent
 

practicable.
 

4. 365-Day Plant-Wide Rolling NOx Tonnage Limitation
 

44. Beginning on June 1, 2014, and continuing thereafter,
 

SRP shall not exceed a 365-Day Plant-Wide Rolling NOx Tonnage
 

Limitation at CGS Units 1 and 2 of 7,300 tons.
 

5. Monitoring of NOx Emissions
 

A. 30-Day Rolling Average NOx Emission Rate
 

45. In determining the 30-Day Rolling Average NOx Emission
 

Rate, SRP shall use CEMS in accordance with the procedures of 40
 

C.F.R. Part 75, except that: (1) NOx emissions data need not be
 

bias adjusted, (2) for any CEMS with a span less than 100 parts
 

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per million (“ppm”), the calibration drift and out-of-control
 

criteria in Procedure 1, section 4.3 of Part 60, Appendix F shall
 

apply in lieu of the low emitter specifications in Part 75,
 

Appendix B, section 2.1, (3) for any CEMS with a span less than
 

or equal to 30 ppm the exemption from the Part 75 linearity check
 

will not apply and either the Part 75 linearity check or the
 

cylinder gas audit described in Procedure 1, section 5.1.2 of
 

Part 60, Appendix F shall be performed on a quarterly basis, and
 

(4) for the Unit controlled by SCR, an annual relative accuracy
 

test audit shall meet, at a minimum, a relative accuracy of less
 

than 20% or an accuracy of less than 0.016 lb/mmBtu (expressed as
 

the difference between the monitor mean and the reference value
 

mean).
 

B. 365-Day Plant-Wide Rolling NOx Tonnage Limitation
 

46. For purposes of calculating the 365-day Plant-Wide
 

Rolling NOx Tonnage Limitation, SRP shall use CEMS in accordance
 

with the procedures specified in 40 C.F.R. Part 75.
 

V. SO2 EMISSION REDUCTIONS AND CONTROLS
 

A. Best Management Practices for Existing SO2 Controls
 

47. Beginning thirty (30) days after entry of this Consent
 

Decree, SRP shall continuously operate and maintain, to the
 

maximum extent practicable, its existing FGDs on CGS Unit 1 and
 

Unit 2 in a manner consistent with good engineering and
 

maintenance practices for minimizing SO2 emissions.
 

B. SO2 Emission Controls
 

1. New FGD Installations at First Unit
 

48. SRP shall install a new FGD on one Unit no later than
 

January 1, 2012. 	 Beginning on January 1, 2012, and continuing
 

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thereafter, SRP shall commence continuous operation of the FGD so
 

as to achieve and maintain a 30-Day Rolling Average SO2 Removal
 

Efficiency at this Unit of at least 95.0% or a 30-Day Rolling
 

Average SO2 Emissions Rate of no greater than 0.080 lb/mmBtu.
 

2. New FGD Installation at Second Unit
 

49. SRP shall install a new FGD on the Unit not selected
 

pursuant to Paragraph 48 no later than January 1, 2013. 


Beginning on January 1, 2013, and continuing thereafter, SRP
 

shall commence continuous operation of the FGD so as to achieve
 

and maintain a 30-Day Rolling Average SO2 Removal Efficiency at
 

this second Unit of at least 95.0% or a 30-Day Rolling Average
 

SO2 Emissions Rate of no greater than 0.080 lb/mmBtu.
 

3. Continuous Operation of SO2 Controls
 

50. SRP shall continuously operate each FGD covered under
 

this Consent Decree at all times that the Unit it serves is in
 

operation, consistent with the technological limitations,
 

manufacturers’ specifications, and good engineering and
 

maintenance practices for the FGDs for minimizing emissions to
 

the extent practicable.
 

C. Surrender of SO2 Allowances
 

51. For purposes of this Subsection, “surrender” means,
 

with regard to SO2 Allowances, permanently surrendering so that
 

such SO2 Allowances can never be used to meet any compliance
 

requirement under the Clean Air Act or the Arizona SIP.
 

52. Except as provided in Paragraph 59, SRP shall not sell,
 

trade, or transfer any SO2 Allowances allocated to CGS that would
 

otherwise be available for sale, trade, or transfer as a result
 

of the actions taken by SRP to comply with the requirements of
 

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this Consent Decree.
 

53. Beginning with calendar year 2012, SRP shall surrender
 

to EPA, or transfer to a non-profit third party selected by SRP
 

for purposes of surrender, all SO2 Allowances that have been
 

allocated to CGS in excess of the amount needed to meet its own
 

federal and/or State Clean Air Act regulatory requirements at CGS
 

and Springerville Unit 4, which is located at the Springerville
 

Generating Station.
 

54. If SRP commences operation of one or more new coal-


fired units that it owns in whole or in part, as further
 

described in this Paragraph, in the Western Electricity
 

Coordinating Council Region no earlier than five (5) years and no
 

later than fourteen (14) years from the date this Consent Decree
 

is entered by this Court, then SRP may also use SO2 Allowances,
 

as limited by this Paragraph, allocated to CGS to meet the
 

federal and/or state Clean Air Act regulatory requirements for
 

certain SO2 emissions from such new coal-fired unit(s). SRP may
 

only use such SO2 Allowances pursuant to this Paragraph if such
 

new coal-fired unit(s) is equipped with the Best Available
 

Control Technology (if the new coal-fired unit(s) will be
 

emitting any of the pollutants set forth at 40 C.F.R.
 

§ 52.21(b)(50) and the new coal-fired unit(s) will be located in
 

an attainment area for those pollutants) and/or the Lowest
 

Achievable Emission Rate (if the new coal-fired unit(s) will be
 

emitting any of the pollutants set forth at 40 C.F.R.
 

§ 51.165(a)(xxxvii) and the new coal-fired unit(s) will be
 

located in a nonattainment area for those pollutants). SRP may
 

only use SO2 Allowances for the SO2 emissions associated with a
 

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total of 400 megawatts (MW) that it owns at such new coal-fired
 

unit(s), whether at one new coal-fired unit (e.g., SRP owns a
 

total of at least 400 MW at one new coal-fired unit) or in the
 

aggregate at multiple new coal-fired units (e.g., SRP owns 100 MW
 

at four new coal-fired units for an aggregate total of 400 MW). 


To determine the number of SO2 Allowances SRP may use pursuant to
 

this Paragraph, SRP may use no more than that number of SO2
 

Allowances that cover the same percentage of total SO2 emissions
 

from such new coal-fired unit(s) as the percentage of SRP’s
 

ownership in such new coal-fired unit(s), on a MW basis. Thus,
 

for example, if SRP owns 400 MW of a new 800 MW coal-fired unit
 

that otherwise meets the requirements of this Paragraph, SRP may
 

use excess SO2 Allowances allocated to CGS to cover no more than
 

fifty (50) percent of the total SO2 emissions from such new coal-


fired unit. This reduction in the amount of SO2 Allowances
 

surrendered by or on behalf of SRP would start with the year this
 

new Unit(s) commences operation.
 

55. SRP shall make its surrender of SO2 Allowances
 

annually, within forty-five (45) days of its receipt from EPA of
 

the Annual Deduction Reports for SO2. Any surrender need not
 

include the specific SO2 Allowances that were allocated to CGS,
 

so long as SRP surrenders SO2 Allowances that are from the same
 

year and that are equal to the number required to be surrendered
 

under this Subsection.
 

56. If any SO2 Allowances are transferred directly to a
 

non-profit third party for surrender to EPA, SRP shall include a
 

description of such transfer in the next report submitted to EPA
 

pursuant to Section XI (Periodic Reporting) of this Consent
 

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Decree. Such report shall: (i) provide the identity of the
 

non-profit third-party recipient(s) of the SO2 Allowances and a
 

listing of the serial numbers of the transferred SO2 Allowances;
 

and (ii) include a certification by the non-profit third-party
 

recipient(s) stating that the recipient(s) will not sell, trade,
 

or otherwise exchange any of the SO2 Allowances and will not use
 

any of the SO2 Allowances to meet any obligation imposed by any
 

environmental law. No later than the third periodic report due
 

after the transfer of any SO2 Allowances, SRP shall include a
 

statement that the non-profit third-party recipient(s)
 

surrendered the SO2 Allowances for permanent surrender to EPA in
 

accordance with the provisions of Paragraph 57 within one (1)
 

year after SRP transferred the SO2 Allowances to them. SRP shall
 

not have complied with the SO2 Allowance surrender requirements
 

of this Subsection until all non-profit third-party recipient(s)
 

shall have actually surrendered the transferred SO2 Allowances to
 

EPA.
 

57. For all SO2 Allowances surrendered to EPA, SRP or the
 

non-profit third-party recipient(s) (as the case may be) shall
 

first submit an SO2 Allowance transfer request form to EPA’s
 

Office of Air and Radiation’s Clean Air Markets Division
 

directing the transfer of such SO2 Allowances to the EPA
 

Enforcement Surrender Account or to any other EPA account that
 

EPA may direct in writing. As part of submitting these transfer
 

requests, SRP or the non-profit third-party recipient(s) shall
 

irrevocably authorize the transfer of these SO2 Allowances and
 

identify – by name of account and any applicable serial or other
 

identification numbers or station names – the source and location
 

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of the SO2 Allowances being surrendered.
 

D. Monitoring of SO2 Emissions
 

58. In determining the 30-Day Rolling Average SO2 Emission
 

Rate and the 30-Day Rolling Average SO2 Removal Efficiency, SRP
 

shall use CEMS in accordance with the procedures of 40 C.F.R.
 

Part 75, except that: (1) SO2 emissions data need not be bias
 

adjusted; (2) inlet pounds of SO2 will be calculated as described
 

in Paragraph 7 in lieu of installing an inlet flow monitor, (3)
 

on any CEMS with a span less than 100 ppm, the calibration drift
 

and out-of-control criteria in Procedure 1, section 4.3 of Part
 

60, Appendix F shall apply in lieu of the low emitter
 

specifications in Part 75, Appendix B, section 2.1, (4) on any
 

CEMS with a span less than or equal to 30 ppm the exemption from
 

the Part 75 linearity check will not apply and either the Part 75
 

linearity check or the cylinder gas audit described in Procedure
 

1, section 5.1.2 of Part 60, Appendix F shall be performed on a
 

quarterly basis, and (5) an annual relative accuracy test audit
 

shall meet, at a minimum, a relative accuracy of less than 20% or
 

an accuracy of less than 0.016 lb/mmBtu (expressed as the
 

difference between the monitor mean and the reference value
 

mean).
 

E. General SO2 Provisions
 

59. Provided that SRP is in compliance with all SO2
 

emission limitations established in this Consent Decree, nothing
 

in this Consent Decree shall preclude SRP from using, selling, or
 

transferring Super-Compliant SO2 Allowances that may arise as a
 

result of achieving and maintaining SO2 emission rates or removal
 

efficiencies at Unit 1 and Unit 2 below the emission limits
 

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required in this Consent Decree, so long as SRP timely reports
 

the generation of such Super-Compliant SO2 Allowances in
 

accordance with Section XI (Periodic Reporting) of this Consent
 

Decree.
 

60. SRP shall not use SO2 Allowances to comply with any
 

requirement of this Consent Decree, including by claiming
 

compliance with any emission limitation required by this Consent
 

Decree by using, tendering, or otherwise applying SO2 Allowances
 

to offset any excess emissions (i.e., emissions above the limits
 

specified in Paragraphs 48 and 49).
 

61. Nothing in this Consent Decree shall prevent SRP from
 

purchasing or otherwise obtaining SO2 Allowances from another
 

source for purposes of complying with state or federal Clean Air
 

Act requirements to the extent otherwise allowed by law.
 

62. The requirements in Paragraphs 52 through 57 and 59 of
 

this Consent Decree pertaining to SRP’s surrender of SO2
 

Allowances are permanent injunctions not subject to any
 

termination provision of this Consent Decree.
 

VI. PM EMISSION REDUCTIONS AND CONTROLS
 

A. Optimization of Existing ESPs
 

63. Beginning thirty (30) days after entry of this Consent
 

Decree, and continuing thereafter, SRP shall operate each ESP on
 

each Unit at CGS at all times when the Unit is in operation to
 

maximize PM emission reductions, provided that such operation of
 

the ESP is consistent with the technological limitations,
 

manufacturers’ specifications and good engineering and
 

maintenance practices for the ESP. Except as required during
 

correlation testing under 40 C.F.R. Part 60, Appendix B,
 

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Performance Specification 11, and Quality Assurance Requirements
 

under Appendix F, Procedure 2, as required by this Consent
 

Decree, SRP shall, at a minimum, to the extent reasonably
 

practicable: (a) fully energize each section of the ESP for each
 

unit, and repair any failed ESP section at the next planned or
 

unplanned Unit outage of sufficient length; (b) operate automatic
 

control systems on each ESP to maximize PM collection efficiency;
 

(c) maintain power levels delivered to the ESPs, consistent with
 

manufacturers’ specifications, the operational design of the
 

Unit, and good engineering practices; (d) inspect for and repair
 

during the next planned or unplanned Unit outage of sufficient
 

length any openings in ESP casings, ductwork and expansion joints
 

to minimize air leakage; and (e) optimize the plate-cleaning and
 

discharge-electrode-cleaning systems for the ESPs at each Unit by
 

varying the cycle time, cycle frequency, rapper-vibrator
 

intensity, and number of strikes per cleaning event.
 

B. PM Emission Rate and Monitoring Requirements
 

64. Upon installation and commencement of operation of a
 

FGD system for a Unit as required by Paragraphs 48 and 49, and
 

continuing thereafter, that Unit shall achieve and maintain a PM
 

Emission Rate no greater than 0.030 lb/mmBtu.
 

65. Within one hundred eighty (180) days after each date
 

established by this Consent Decree for SRP to achieve and
 

maintain a PM Emission Rate, and continuing annually thereafter,
 

SRP shall conduct a stack test for PM. To determine compliance
 

with the PM Emission Rate established in Paragraph 64, SRP shall
 

use the reference methods and procedures (filterable portion
 

only) specified in 40 C.F.R. Part 60, App. A-3, Method 5, Method
 

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5B, or Method 5I, App. A-6, Method 17, or alternative stack tests
 

or methods that are requested by SRP and approved by EPA and
 

Arizona DEQ. Each test shall consist of three separate runs
 

performed under representative operating conditions not including
 

periods of startup, shutdown, or malfunction. The sampling time
 

for each run shall be at least 120 minutes and the volume of each
 

run shall be 1.70 dry standard cubic meters (60 dry standard
 

cubic feet). SRP shall calculate the PM Emission Rate from the
 

stack test results in accordance with 40 C.F.R. § 60.8(f). The
 

results of each PM stack test shall be submitted to EPA and
 

Arizona DEQ within forty-five (45) days of completion of each
 

test.
 

66. When SRP submits the application for amendment to its
 

Title V permit pursuant to Paragraph 134, that application shall
 

include a Compliance Assurance Monitoring (“CAM”) plan, under 40
 

C.F.R. Part 64, for the PM Emission Rate in Paragraph 64. The PM
 

CEMS required under Paragraph 67 may be used in that CAM plan.
 

C. PM CEMS
 

67. SRP shall install, correlate, maintain, and operate PM
 

CEMS on Unit 1 and Unit 2 as specified below. The PM CEMS shall
 

comprise a continuous particle mass monitor measuring particulate
 

matter concentration, directly or indirectly, on an hourly 


average basis and a diluent monitor used to convert the
 

concentration to units expressed in lb/mmBtu. The PM CEMS
 

installed at each Unit must be appropriate for the anticipated
 

stack conditions and capable of measuring PM concentrations on an
 

hourly average basis. SRP shall maintain, in an electronic
 

database, the hourly average emission values of all PM CEMS in
 

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lb/mmBtu. Except for periods of monitor malfunction, maintenance,
 

or repair, SRP shall continuously operate the PM CEMS at all
 

times when the Unit it serves is operating.
 

68. No later than January 1, 2010, SRP shall submit to EPA
 

and Arizona DEQ for review and approval pursuant to Section XII
 

(Review and Approval of Submittals) of this Consent Decree a plan
 

for the installation and correlation of the PM CEMS for Unit 1
 

and Unit 2.
 

69. No later than one hundred twenty (120) days prior to
 

the deadline to commence operation of the PM CEMS as set forth in
 

Paragraph 71, SRP shall submit to EPA and Arizona DEQ for review
 

and approval pursuant to Section XII (Review and Approval of
 

Submittals) of this Consent Decree a proposed Quality
 

Assurance/Quality Control (“QA/QC”) protocol that shall be
 

followed for such PM CEMS.
 

70. In developing both the plan for installation and
 

correlation of the PM CEMS and the QA/QC protocol, SRP shall use
 

the criteria set forth in 40 C.F.R. Part 60, Appendix B,
 

Performance Specification 11, and Appendix F, Procedure 2. 


Following EPA’s and Arizona DEQ’s approval of the plan described
 

in Paragraph 68 and the QA/QC protocol described in Paragraph 69,
 

SRP shall thereafter operate the PM CEMS in accordance with the
 

approved plan and QA/QC protocol.
 

71. Within one hundred eighty (180) calendar days following
 

commencement of operation of each FGD, SRP shall install,
 

correlate, maintain, and operate a PM CEMS on the Unit being
 

controlled by the new FGD, conduct performance specification
 

tests on that PM CEMS, and demonstrate compliance with the PM
 

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CEMS installation and correlation plan submitted to and approved
 

by EPA and Arizona DEQ in accordance with Paragraphs 68 and 69. 


SRP shall report, pursuant to Section XI (Periodic Reporting),
 

the data recorded by the PM CEMS, expressed in lb/mmBtu on a
 

rolling average 3-hour, 6-hour, 24-hour, 30-day, and 365-day
 

basis in electronic format to EPA and Arizona DEQ and identify in
 

the report any PM concentrations measured by the PM CEMS that are
 

greater than 125% of the highest PM concentration level used in
 

the most recent correlation testing performed pursuant to
 

Performance Specification 11.
 

72. SRP shall operate the PM CEMS for at least two (2)
 

years. If, after two (2) years of operation, SRP believes that
 

it is infeasible to continue operation of the PM CEMS, SRP may
 

submit a demonstration of infeasibility to EPA. As part of that
 

demonstration, SRP shall submit an alternative PM monitoring plan
 

for review and approval by EPA. If EPA disapproves the
 

alternative monitoring plan, or if EPA rejects SRP’s assertion
 

that it is infeasible to continue operating the PM CEMS, such
 

disagreement is subject to dispute resolution as specified in
 

this Consent Decree.
 

73. Operation of a PM CEMS shall be considered “infeasible”
 

if, by way of example, the PM CEMS: (a) cannot be kept in proper
 

condition for sufficient periods of time to produce reliable,
 

adequate, or useful data; or (b) SRP demonstrates that recurring,
 

chronic, or unusual equipment adjustment or servicing needs in
 

relation to other types of continuous emission monitors cannot be
 

resolved through reasonable expenditures of resources; or (c)
 

chronic and difficult operational issues at Unit 1 or Unit 2
 

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cannot be resolved through reasonable expenditure of resources;
 

or (d) the data produced by the CEMS cannot be used to assess PM
 

emissions from Unit 1 or Unit 2 or performance of that Unit’s
 

control devices. If EPA determines that SRP has demonstrated
 

infeasibility pursuant to this Paragraph, SRP shall be entitled
 

to discontinue operation of and remove the PM CEMS.
 

D. General PM Provisions
 

74. Although stack testing shall be used to determine
 

compliance with the PM Emission Rate established by this Consent
 

Decree, data from PM CEMS shall be used, at a minimum, to monitor
 

progress in reducing PM emissions.
 

75. Nothing in this Consent Decree is intended to, or
 

shall, alter or waive any applicable law (including but not
 

limited to any defenses, entitlements, challenges, or
 

clarifications related to the Credible Evidence Rule, 62 Fed.
 

Reg. 8314 (Feb. 24, 1997)) concerning the use of data for any
 

purpose under the Act.
 

VII. PROHIBITION ON NETTING CREDITS OR OFFSETS
 

76. Emission reductions at CGS that result from actions to
 

be taken by SRP after entry of this Consent Decree to comply with
 

the requirements of this Consent Decree shall not be considered
 

as a creditable contemporaneous emission decrease for the purpose
 

of obtaining a netting credit or offset under the Clean Air Act’s
 

Nonattainment New Source Review and PSD programs. 


77. The limitations on the generation and use of netting
 

credits and offsets set forth in the previous Paragraph do not
 

apply to emission reductions achieved at CGS that are greater
 

than those required under this Consent Decree. For purposes of
 

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this Paragraph, emission reductions at CGS are greater than those
 

required under this Consent Decree if they result from CGS’s
 

compliance with federally-enforceable emission limits that are
 

more stringent than those limits imposed on CGS Unit 1 and Unit 2
 

under this Consent Decree and under applicable provisions of the
 

Clean Air Act or the Arizona SIP.
 

78. Nothing in this Consent Decree is intended to preclude
 

the emission reductions generated under this Consent Decree from
 

being considered by the State or EPA as creditable
 

contemporaneous emission decreases for the purpose of attainment
 

demonstrations submitted pursuant to § 110 of the Act, 42 U.S.C.
 

§ 7410, or in determining impacts on National Ambient Air Quality
 

Standards, PSD increment, or air quality related values,
 

including visibility, in a Class I area.
 

VIII. ENVIRONMENTAL PROJECTS
 

79. SRP shall implement the Environmental Projects
 

(“Projects”) described in Appendix A to this Consent Decree in
 

compliance with the approved plans and schedules for such
 

Projects and other terms of this Consent Decree. In implementing
 

the Projects, SRP shall spend no less than $4,000,000 in Project
 

Dollars. SRP shall not include its own personnel costs in
 

overseeing the implementation of the Projects as Project Dollars.
 

80. SRP shall maintain, and present to EPA upon request,
 

all documents to substantiate the Project Dollars expended to
 

implement the Projects described in Appendix A, and shall provide
 

these documents to EPA within thirty (30) days of a request for
 

the documents.
 

81. All plans and reports prepared by SRP pursuant to the
 

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requirements of this Section of the Consent Decree and required
 

to be submitted to EPA shall be publicly available from SRP
 

without charge.
 

82. SRP shall certify, as part of each plan submitted to
 

EPA for any Project, that SRP is not otherwise required by law to
 

perform the Project described in the plan, that SRP is unaware of
 

any other person who is required by law to perform the Project,
 

and that SRP will not use any Project, or portion thereof, to
 

satisfy any obligations that it may have under other applicable
 

requirements of law, including any applicable renewable or energy
 

efficiency portfolio standards.
 

83. SRP shall use good faith efforts to secure as much
 

benefit as possible for the Project Dollars expended, consistent
 

with the applicable requirements and limits of this Consent
 

Decree.
 

84. If SRP elects (where such an election is allowed) to
 

undertake a Project by contributing funds to another person or
 

entity that will carry out the Project in lieu of SRP, but not
 

including SRP’s agents or contractors, that person or
 

instrumentality must, in writing: (a) identify its legal
 

authority for accepting such funding; and (b) identify its legal
 

authority to conduct the Project for which SRP contributes the
 

funds. Regardless of whether SRP elects (where such election is
 

allowed) to undertake a Project by itself or to do so by
 

contributing funds to another person or instrumentality that will
 

carry out the Project, SRP acknowledges that it will receive
 

credit for the expenditure of such funds as Project Dollars only
 

if SRP demonstrates that the funds have been actually spent by
 

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either SRP or by the person or instrumentality receiving them,
 

and that such expenditures met all requirements of this Consent
 

Decree.
 

85. SRP shall comply with the reporting requirements
 

described in Appendix A.
 

86. Within sixty (60) calendar days following the
 

completion of each Project required under this Consent Decree
 

(including any applicable periods of demonstration or testing),
 

SRP shall submit to the United States a report that documents the
 

date that the Project was completed, SRP’s results of
 

implementing the Project, including the emission reductions or
 

other environmental benefits achieved, and the Project Dollars
 

expended by SRP in implementing the Project.
 

IX. CIVIL PENALTY
 

87. Within thirty (30) calendar days after entry of this
 

Consent Decree, SRP shall pay to the United States a civil
 

penalty in the amount of $950,000. The civil penalty shall be
 

paid by Electronic Funds Transfer (“EFT”) to the United States
 

Department of Justice, in accordance with current EFT procedures,
 

referencing USAO File Number 2008V00564 and DOJ Case Number 90-5­

2-1-09174 and the civil action case name and case number of this
 

action. The costs of such EFT shall be SRP’s responsibility. 


Payment shall be made in accordance with instructions provided to
 

SRP by the Financial Litigation Unit of the U.S. Attorney’s
 

Office for the District of Arizona. Any funds received after
 

2:00 p.m. EDT shall be credited on the next business day. At the
 

time of payment, SRP shall provide notice of payment, referencing
 

the USAO File Number, the DOJ Case Number, and the civil action
 

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case name and case number, to the Department of Justice and to
 

EPA in accordance with Section XVIII (Notices) of this Consent
 

Decree.
 

88. Failure to timely pay the civil penalty shall subject
 

SRP to interest accruing from the date payment is due until the
 

date payment is made at the rate prescribed by 28 U.S.C. § 1961,
 

and shall render SRP liable for all charges, costs, fees, and
 

penalties established by law for the benefit of a creditor or of
 

the United States in securing payment. 


89. Payments made pursuant to this Section are penalties
 

within the meaning of Section 162(f) of the Internal Revenue
 

Code, 26 U.S.C. § 162(f), and are not tax-deductible expenditures
 

for purposes of federal law.
 

X. RESOLUTION OF PAST CIVIL CLAIMS
 

90. Entry of this Consent Decree shall resolve all civil
 

claims of the United States arising under Part C of Subchapter I
 

of the Clean Air Act, 42 U.S.C. §§ 7470 to 7492, under the
 

modification provisions of the Clean Air Act's Standards of
 

Performance for New Stationary Sources program, 42 U.S.C. § 7411
 

and 40 C.F.R. § 60.14, and under Subchapter V of the Clean Air
 

Act, §§ 7661 to 7661f, that arose from modifications that
 

commenced at CGS prior to the date of lodging of this Consent
 

Decree.
 

XI. PERIODIC REPORTING
 

91. After entry of this Consent Decree, SRP shall submit to
 

the United States a periodic report, within sixty (60) days after
 

the end of each half of the calendar year (January through June
 

and July through December). The report shall include the
 

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following information:
 

a. all information necessary to determine compliance with 

the requirements of the following Paragraphs of this 

Consent Decree: Paragraphs 41 through 46 concerning 

NOx emissions and monitoring; Paragraphs 47 through 58 

concerning SO2 emissions and monitoring, and the 

surrender of SO2 Allowances; and Paragraphs 63 through 

66 concerning PM emissions and monitoring; 

b. all data recorded by the PM CEMS as required by 

Paragraph 71, and all periods of monitor malfunction, 

maintenance, and/or repair as provided in Paragraph 67; 

c. all information relating to Super-Compliant SO2 

Allowances that SRP claims to have generated in 

accordance with Paragraph 59 through compliance beyond 

the requirements of this Consent Decree; 

d. all information relating to the NOx Offset Requirement 

pursuant to Paragraphs 98 and 99; and 

e. all information indicating that the installation and 

commencement of operation for a pollution control 

device may be delayed, including the nature and cause 

of the delay, and any steps taken by SRP to mitigate 

such delay. 

92. In any periodic report submitted pursuant to this
 

Section, SRP may incorporate by reference information previously
 

submitted under its Title V permitting requirements, provided
 

that SRP attaches the Title V permit report (or the pertinent
 

portions of such report) and provides a specific reference to the
 

provisions of the Title V permit report that are responsive to
 

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the information required in the periodic report.
 

93. In addition to the reports required by Paragraph 91, if
 

SRP violates or deviates from any provision of this Consent
 

Decree, SRP shall submit to the United States a report on the
 

violation or deviation within ten (10) business days after SRP
 

knew or should have known of the event. In the report, SRP shall
 

explain the cause or causes of the violation or deviation and any
 

measures taken or to be taken by SRP to cure the reported
 

violation or deviation or to prevent such violation or deviations
 

in the future. If at any time, the provisions of this Consent
 

Decree are included in Title V Permits, consistent with the
 

requirements for such inclusion in this Consent Decree, then the
 

deviation reports required under applicable Title V regulations
 

shall be deemed to satisfy all the requirements of this
 

Paragraph.
 

94. Each SRP report shall be signed by either SRP’s Manager
 

of Environmental Services or the Plant Manager at CGS, and shall
 

contain the following certification:
 

This information was prepared either by me or under my
 

direction or supervision in accordance with a system
 

designed to assure that qualified personnel properly
 

gather and evaluate the information submitted. Based
 

on my evaluation, or the direction and my inquiry of
 

the person(s) who manage the system, or the person(s)
 

directly responsible for gathering the information, I
 

hereby certify under penalty of law that, to the best
 

of my knowledge and belief, this information is true,
 

accurate, and complete. I understand that there are
 

significant penalties for submitting false, inaccurate,
 

or incomplete information to the United States.
 

95. If any SO2 Allowances are surrendered to any non-profit
 

third party pursuant to Section V, the non-profit third party’s
 

certification shall be signed by a managing officer of the non32
 
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profit third party and shall contain the following language:
 

I certify under penalty of law that _____________ [name
 

of non-profit third party] will not sell, trade, or
 

otherwise exchange any of the allowances and will not
 

use any of the allowances to meet any obligation
 

imposed by any environmental law. I understand that
 

there are significant penalties for making
 

misrepresentations to or misleading the United States.
 

XII. REVIEW AND APPROVAL OF SUBMITTALS
 

96. SRP shall submit each plan, report, or other submission
 

required by this Consent Decree to EPA whenever such a document
 

is required to be submitted for review or approval pursuant to
 

this Consent Decree. EPA may approve the submittal or decline to
 

approve it and provide written comments explaining the bases for
 

declining such approval as soon as reasonably practicable. 


Within sixty (60) days of receiving written comments from EPA,
 

SRP shall either: (a) revise the submittal consistent with the
 

written comments and provide the revised submittal to EPA; or (b)
 

submit the matter for dispute resolution, including the period of
 

informal negotiations, under Section XV (Dispute Resolution) of
 

this Consent Decree.
 

97. Upon receipt of EPA’s final approval of the submittal,
 

or upon completion of the submittal pursuant to dispute
 

resolution, SRP shall implement the approved submittal in
 

accordance with the schedule specified therein or another EPA-


approved schedule.
 

XIII. STIPULATED PENALTIES
 

98. For any failure by SRP to comply with the terms of this
 

Consent Decree, and subject to the provisions of Sections XIV
 

(Force Majeure) and XV (Dispute Resolution), and except as
 

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provided in Paragraph 99, SRP shall pay, within thirty (30) days
 

after receipt of written demand to SRP by the United States, the
 

following stipulated penalties to the United States:
 

Consent Decree Violation Stipulated Penalty 

a. Failure to pay the civil penalty as 

specified in Section IX (Civil Penalty) 

of this Consent Decree 

$10,000 per day 

b. Failure to comply with any 

applicable 30-Day Rolling Average NOx 

Emission Rate, 30-Day Rolling Average 

SO2 Emission Rate or 30-Day Rolling 

Average SO2 Removal Efficiency 

$2,500 per day per 

violation where the 

violation is less 

than 5% in excess of 

the lb/mmBtu limits, 

or less than 0.25% 

below the removal 

efficiency 

requirement 

$5,000 per day per 

violation where the 

violation is equal to 

or greater than 5% 

but less than 10% in 

excess of the 

lb/mmBtu limits, or 

equal to or greater 

than 0.25% but less 

than 0.50% below the 

removal efficiency 

requirement 

$10,000 per day per 

violation where the 

violation is equal to 

or greater than 10% 

in excess of the 

lb/mmBtu limits, or 

greater than 0.50% 

below the removal 

efficiency 

requirement 

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c. Failure to comply with the 

applicable 365-Day Plant-Wide Rolling 

NOx Tonnage Limitation established by 

this Consent Decree 

$200,000 for the 

first 365-Day PlantWide Rolling NOx 

Tonnage Limitation 

violation, plus 

$5,000 for each 

subsequent 365-Day 

Plant-Wide Rolling 

NOx Tonnage 

Limitation violation 

that includes any day 

in a previouslyassessed 365-Day 

Plant-Wide Rolling 

NOx Tonnage 

Limitation violation, 

plus offset NOx 

emissions in an 

amount that is at 

least equal to the 

number of tons by 

which the 365-Day 

Plant-Wide Rolling 

NOx Tonnage 

Limitation was 

exceeded, in 

accordance with the 

requirements of 

Paragraph 99, below 

d. Failure to install, commence 

operation, or continue operation of a 

NOx, SO2, or PM control device on either 

Unit 1 or Unit 2, as required under this 

Consent Decree 

$10,000 per day per 

violation during the 

first 30 days, 

$27,500 per day per 

violation thereafter 

e. Failure to install or operate CEMS 

as required in this Consent Decree 

$1,000 per day per 

violation 

f. Failure to apply for any permit 

required by Section XVI (Permits) 

$1,000 per day per 

violation 

g. Failure to timely submit, modify, or 

implement, as approved, the reports, 

plans, studies, analyses, protocols, or 

other submittals required by this 

Consent Decree 

$750 per day per 

violation during the 

first 10 days, $1,000 

per day per violation 

thereafter 

h. Failure to surrender SO2 Allowances 

as required by Paragraphs 52 through 55, 

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(a) $27,500 per day 

plus (b) $1,000 per 

SO2 Allowance not 

surrendered 

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i. Failure to demonstrate the thirdparty surrender of an SO2 Allowance in 

accordance with Paragraph 56 

$2,500 per day per 

violation 

j. Failure to undertake and complete 

any of the Environmental Projects in 

compliance with Section VIII 

(Environmental Projects) of this Consent 

Decree 

$1,000 per day per 

violation during the 

first 30 days, $5,000 

per day per violation 

thereafter 

k. Any other violation of this Consent 

Decree 

$1,000 per day per 

violation 

99. NOx Offset Requirements.
 

a. No later than ninety (90) days following written demand
 

by the United States for stipulated penalties pursuant to
 

Paragraph 98.c, SRP shall submit a plan pursuant to Section XII
 

(Review and Approval of Submittals), to obtain actual emission
 

reductions of NOx from sources other than CGS in Arizona,
 

Colorado, New Mexico, or Utah to offset excess NOx emissions as
 

required by Paragraph 98.c.
 

b. Such plan shall describe the manner in which SRP will
 

obtain the required NOx emission reductions, and shall ensure
 

that the total tons of NOx emissions that exceeded the 365-Day
 

Plant-Wide Rolling NOx Tonnage Limitation are offset, no later
 

than three (3) years from the date the plan is approved pursuant
 

to Section XII (Review and Approval of Submittals), by an amount
 

of equal or greater actual NOx emission reductions from the
 

proposed source(s).
 

c. SRP shall implement the project(s) in the approved plan
 

in a manner which ensures that the offsetting NOx emissions are
 

obtained no later than three (3) years from the date the plan is
 

approved pursuant to Section XII (Review and Approval of
 

Submittals). In the next report submitted to EPA pursuant to
 

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Section XI (Periodic Reporting)following three (3) years from the
 

date the plan is approved, SRP shall provide documentation to
 

demonstrate that it fully and timely obtained the offsetting NOx
 

emission reductions in accordance with the approved plan. 


d. NOx emission reductions required by the Clean Air Act,
 

its implementing regulations, or a state implementation plan
 

shall not be approved as emission reductions to offset NOx
 

emissions pursuant to Paragraph 98.c. EPA will apply Clean Air
 

Act § 173(c), 40 C.F.R. § 51.165, and Appendix S to Part 51 for
 

purposes of determining whether to approve the proposed plan.
 

100. Violations of any limit based on a 30-day rolling
 

average constitutes thirty (30) days of violation but where such
 

a violation (for the same pollutant and from the same Unit)
 

recurs within periods less than thirty (30) days, SRP shall not
 

be obligated to pay a daily stipulated penalty for any day of the
 

recurrence for which a stipulated penalty has already been paid.
 

101. All stipulated penalties shall begin to accrue on the
 

day after the performance is due or on the day a violation
 

occurs, whichever is applicable, and shall continue to accrue
 

until performance is satisfactorily completed or until the
 

violation ceases, whichever is applicable. Nothing in this
 

Consent Decree shall prevent the simultaneous accrual of separate
 

stipulated penalties for separate violations of this Consent
 

Decree.
 

102. SRP shall pay all stipulated penalties to the United
 

States within thirty (30) days of receipt of written demand to
 

SRP from the United States, and shall continue to make such
 

payments every thirty (30) days thereafter until the violation(s)
 

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no longer continues, unless SRP elects within twenty (20) days of
 

receipt of written demand to SRP from the United States to
 

dispute the accrual of stipulated penalties in accordance with
 

the provisions in Section XV (Dispute Resolution) of this Consent
 

Decree.
 

103. Stipulated penalties shall continue to accrue as
 

provided in accordance with Paragraph 101 during any dispute,
 

with interest on accrued stipulated penalties payable and
 

calculated at the rate established by the Secretary of the
 

Treasury, pursuant to 28 U.S.C. § 1961, but need not be paid
 

until the following: 


a. If the dispute is resolved by agreement, or by a 

decision of the United States pursuant to Section XV 

(Dispute Resolution) of this Consent Decree that is not 

appealed to the Court, accrued stipulated penalties 

agreed or determined to be owing, together with accrued 

interest, shall be paid within thirty (30) days of the 

effective date of the agreement or of the receipt of 

the United States’s decision; 

b. If the dispute is appealed to the Court and the United 

States prevails in whole or in part, SRP shall, within 

thirty (30) days of receipt of the Court’s decision or 

order, pay all accrued stipulated penalties determined 

by the Court to be owing, together with interest 

accrued on such penalties determined by the Court to be 

owing, except as provided in Subparagraph c, below; 

c. If the Court’s decision is appealed by either Party, 

SRP shall, within fifteen (15) days of receipt of the 

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final appellate court decision, pay all accrued
 

stipulated penalties determined to be owing, together
 

with interest accrued on such stipulated penalties
 

determined to be owing by the appellate court.
 

Notwithstanding any other provision of this Consent Decree, the
 

accrued stipulated penalties agreed by the United States and SRP,
 

or determined by the United States through Dispute Resolution, to
 

be owing may be less than the stipulated penalty amounts set
 

forth in Paragraph 98.
 

104. All stipulated penalties shall be paid in the manner
 

set forth in Section IX (Civil Penalty) of this Consent Decree.
 

105. Should SRP fail to pay stipulated penalties in
 

compliance with the terms of this Consent Decree, the United
 

States shall be entitled to collect interest on such penalties,
 

as provided for in 28 U.S.C. § 1961.
 

106. The stipulated penalties provided for in this Consent
 

Decree shall be in addition to any other rights, remedies, or
 

sanctions available to the United States by reason of SRP’s
 

failure to comply with any requirement of this Consent Decree or
 

applicable law, except that for any violation of the Act for
 

which this Consent Decree provides for payment of a stipulated
 

penalty, SRP shall be allowed a credit for stipulated penalties
 

paid against any statutory penalties also imposed for such
 

violation.
 

107. If either of the Units exceeds an applicable emission
 

limitation set forth in this Consent Decree due to malfunction,
 

SRP has an Affirmative Defense to stipulated penalties under this
 

Consent Decree, if SRP has complied with the reporting
 

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requirements of Paragraphs 111 and 112 and has demonstrated all
 

of the following:
 

a. The excess emissions resulted from a sudden and 

unavoidable breakdown of process equipment or air 

pollution control equipment beyond the reasonable 

control of SRP; 

b. The air pollution control equipment, process equipment, 

or processes were at all times maintained and operated 

in a manner consistent with good practice for 

minimizing emissions; 

c. If repairs were required, the repairs were made in an 

expeditious fashion when the applicable emission 

limitations were being exceeded. Off-shift labor and 

overtime were utilized where practicable to ensure that 

the repairs were made as expeditiously as possible. If 

off-shift labor and overtime were not utilized, SRP 

satisfactorily demonstrated that the measures were 

impracticable; 

d. The amount and duration of the excess 

emissions(including any bypass operation) were 

minimized to the maximum extent practicable during 

periods of such emissions; 

e. All reasonable steps were taken to minimize the impact 

of the excess emissions on ambient air quality; 

f. The excess emissions were not part of a recurring 

pattern indicative of inadequate design, operation, or 

maintenance; 

g. During the period of excess emissions there were no 

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exceedances of the relevant National Ambient Air
 

Quality Standards that could be attributed to the 

emission exceedances at CGS; 

h. The excess emissions did not stem from any activity or 

event that could have been foreseen and avoided, or 

planned, and could not have been avoided by better 

operations and maintenance practices; 

i. All emissions monitoring systems were kept in operation 

if at all practicable; and 

j. SRP’s actions in response to the excess emissions were 

documented by contemporaneous records. 

108. If either of the Units exceeds an applicable emission
 

limitation set forth in this Consent Decree due to startup or
 

shutdown, SRP has an Affirmative Defense to stipulated penalties
 

under this Consent Decree, if SRP has complied with the reporting
 

requirements of Paragraphs 111 and 112 and has demonstrated all
 

of the following:
 

a.	 The excess emissions could not have been prevented
 

through careful and prudent planning and design;
 

b.	 If the excess emissions were the result of a bypass of
 

control equipment, the bypass was unavoidable to
 

prevent loss of life, personal injury, or severe damage
 

to air pollution control equipment, production
 

equipment, or other property;
 

c.	 The air pollution control equipment, process equipment,
 

or processes were at all times maintained and operated
 

in a manner consistent with good practice for
 

minimizing emissions;
 

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d. The amount and duration of the excess emissions 

(including any bypass operation) were minimized to the 

maximum extent practicable during periods of such 

emissions; 

e. All reasonable steps were taken to minimize the impact 

of the excess emissions on ambient air quality; 

f. During the period of excess emissions there were no 

exceedances of the relevant National Ambient Air 

Quality Standards that could be attributed to the 

emission exceedances at CGS; 

g. All emissions monitoring systems were kept in operation 

if at all practicable; and 

h. SRP’s actions in response to the excess emissions were 

documented by contemporaneous records. 

109. If excess emissions occur due to a malfunction during
 

routine startup and shutdown, then those instances shall be
 

treated as other malfunctions subject to Paragraph 107.
 

110. If excess emissions occur due to a malfunction during
 

scheduled maintenance, then those instances shall be treated as
 

other malfunctions subject to Paragraph 107.
 

111. For an Affirmative Defense under Paragraphs 107 or 108,
 

SRP shall demonstrate, through submission of the data and
 

information under the reporting provisions of this section, that
 

all reasonable and practicable measures within SRP’s control were
 

implemented to prevent the occurrence of the excess emissions.
 

112. SRP shall provide notice to the United States in
 

writing of SRP’s intent to assert an Affirmative Defense for
 

malfunction, startup, or shutdown under Paragraphs 107 or 108 as
 

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soon as practicable, but in no event later than twenty-one (21)
 

calendar days following the date of the malfunction, startup or
 

shutdown. This notice shall be submitted to EPA pursuant to the
 

provisions of Section XVIII (Notices). The notice shall contain:
 

a. The identity of each stack or other emission point 

where the excess emissions occurred; 

b. The magnitude of the excess emissions expressed in the 

units of the applicable emission limitation and the 

operating data and calculations used in determining the 

magnitude of the excess emissions; 

c. The time and duration or expected duration of the 

excess emissions; 

d. The identity of the equipment from which the excess 

emissions emanated; 

e. The nature and cause of the emissions; 

f. The steps taken, if the excess emissions were the 

result of a malfunction, to remedy the malfunction and 

the steps taken or planned to prevent the recurrence of 

the malfunctions; 

g. The steps that were or are being taken to limit the 

excess emissions; and 

h. If the source’s permit contains procedures governing 

source operation during periods of startup or 

malfunction and the excess emissions resulted from 

startup or malfunction, a list of the steps taken to 

comply with the permit procedures. 

113. A malfunction, startup, or shutdown shall not
 

constitute a Force Majeure Event unless the malfunction, startup,
 

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or shutdown also meets the definition of a Force Majeure Event,
 

as provided in Section XIV (Force Majeure).
 

XIV. FORCE MAJEURE
 

114. For purposes of this Consent Decree, a “Force Majeure
 

Event” shall mean an event that has been or will be caused by
 

circumstances beyond the control of SRP, its contractors, or any
 

entity controlled by SRP that delays compliance with any
 

provision of this Consent Decree or otherwise causes a violation
 

of any provision of this Consent Decree despite SRP’s best
 

efforts to fulfill the obligation. “Best efforts to fulfill the
 

obligation” include using the best efforts to anticipate any
 

potential Force Majeure Event and to address the effects of any
 

such event (a) as it is occurring and (b) after it has occurred,
 

such that the delay or violation is minimized to the greatest
 

extent possible.
 

115. Notice of Force Majeure Events. If any event occurs or
 

has occurred that may delay compliance with or otherwise cause a
 

violation of any obligation under this Consent Decree, as to
 

which SRP intends to assert a claim of Force Majeure, SRP shall
 

notify the United States in writing as soon as practicable, but
 

in no event later than twenty-one (21) calendar days following
 

the date SRP first knew, or by the exercise of due diligence
 

should have known, that the event caused or may cause such delay
 

or violation. In this notice, SRP shall reference this Paragraph
 

of this Consent Decree and describe the anticipated length of
 

time that the delay or violation may persist, the cause or causes
 

of the delay or violation, all measures taken or to be taken by
 

SRP to prevent or minimize the delay or violation, the schedule
 

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by which SRP proposes to implement those measures, and SRP’s
 

rationale for attributing a delay or violation to a Force Majeure
 

Event. SRP shall adopt all reasonable measures to avoid or
 

minimize such delays or violations. SRP shall be deemed to know
 

of any circumstance which SRP, its contractors, or any entity
 

controlled by SRP knew or should have known. 


116. Failure to Give Notice. If SRP fails to comply with
 

the notice requirements of this Section, the United States may
 

void SRP’s claim for Force Majeure as to the specific event for
 

which SRP has failed to comply with such notice requirement.
 

117. United States’s Response. The United States shall
 

notify SRP in writing regarding SRP’s claim of Force Majeure
 

within twenty (20) business days of receipt of the notice
 

provided under Paragraph 115. If the United States agrees that a
 

delay in performance has been or will be caused by a Force
 

Majeure Event, the United States and SRP shall stipulate to an
 

extension of deadline(s) for performance of the affected
 

compliance requirement(s) by a period equal to the delay actually
 

caused by the event. In such circumstances, an appropriate
 

modification shall be made pursuant to Section XXII
 

(Modification) of this Consent Decree. 


118. Disagreement. If the United States does not accept
 

SRP’s claim of Force Majeure, or if the United States and SRP
 

cannot agree on the length of the delay actually caused by the
 

Force Majeure Event, the matter shall be resolved in accordance
 

with Section XV (Dispute Resolution) of this Consent Decree. 


119. Burden of Proof. In any dispute regarding Force
 

Majeure, SRP shall bear the burden of proving that any delay in
 

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performance or any other violation of any requirement of this
 

Consent Decree was caused by or will be caused by a Force Majeure
 

Event. SRP shall also bear the burden of proving that SRP gave
 

the notice required by this Section and the burden of proving the
 

anticipated duration and extent of any delay(s) attributable to a
 

Force Majeure Event. An extension of one compliance date based
 

on a particular event may, but will not necessarily, result in an
 

extension of a subsequent compliance date.
 

120. Events Excluded. Unanticipated or increased costs or
 

expenses associated with the performance of SRP’s obligations
 

under this Consent Decree shall not constitute a Force Majeure
 

Event.
 

121. Potential Force Majeure Events. The Parties agree
 

that, depending upon the circumstances related to an event and
 

SRP’s response to such circumstances, the kinds of events listed
 

below are among those that could qualify as Force Majeure Events
 

within the meaning of this Section: construction, labor, or
 

equipment delays; malfunction of a Unit or emission control
 

device; unanticipated coal supply or pollution control reagent
 

delivery interruptions; acts of God; acts of war or terrorism;
 

and orders by a government official, government agency, other
 

regulatory authority, or a regional transmission organization,
 

acting under and authorized by applicable law, that directs SRP
 

to supply electricity in response to a system-wide (state-wide or
 

regional) emergency. Depending upon the circumstances and SRP’s
 

response to such circumstances, failure of a permitting authority
 

to issue a necessary permit in a timely fashion may constitute a
 

Force Majeure Event where the failure of the permitting authority
 

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to act is beyond the control of SRP and SRP has taken all steps
 

available to it to obtain the necessary permit, including, but
 

not limited to: submitting a complete permit application;
 

responding to requests for additional information by the
 

permitting authority in a timely fashion; and accepting lawful
 

permit terms and conditions after expeditiously exhausting any
 

legal rights to appeal terms and conditions imposed by the
 

permitting authority.
 

122. As part of the resolution of any matter submitted to
 

this Court under Section XV (Dispute Resolution) regarding a
 

claim of Force Majeure, the United States and SRP by agreement,
 

or this Court by order, may in appropriate circumstances extend
 

or modify the schedule for completion of work under this Consent
 

Decree to account for the delay in the work that occurred as a
 

result of any delay agreed to by the United States or approved by
 

the Court. SRP shall be liable for stipulated penalties for its
 

failure thereafter to complete the work in accordance with the
 

extended or modified schedule (provided that SRP shall not be
 

precluded from making a further claim of Force Majeure with
 

regard to meeting any such extended or modified schedule).
 

XV. DISPUTE RESOLUTION
 

123. The dispute resolution procedure provided by this
 

Section shall be available to resolve all disputes arising under
 

this Consent Decree, provided that the Party invoking such
 

procedure has first made a good faith attempt to resolve the
 

matter with the other Party.
 

124. The dispute resolution procedure required herein shall
 

be invoked by one Party giving written notice to the other Party
 

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advising of a dispute pursuant to this Section. The notice shall
 

describe the nature of the dispute and shall state the noticing
 

Party’s position with regard to such dispute. The Party
 

receiving such a notice shall acknowledge receipt of the notice,
 

and the Parties in dispute shall expeditiously schedule a meeting
 

to discuss the dispute informally not later than fourteen (14)
 

days following receipt of such notice.
 

125. Disputes submitted to dispute resolution under this
 

Section shall, in the first instance, be the subject of informal
 

negotiations between the Parties. Such period of informal
 

negotiations shall not extend beyond thirty (30) calendar days
 

from the date of the first meeting between the Parties’
 

representatives unless they agree in writing to shorten or extend
 

this period.
 

126. If the Parties are unable to reach agreement during the
 

informal negotiation period, the United States shall provide SRP
 

with a written summary of its position regarding the dispute. 


The written position provided by the United States shall be
 

considered binding unless, within forty-five (45) calendar days
 

thereafter, SRP seeks judicial resolution of the dispute by
 

filing a petition with this Court. If SRP seeks judicial
 

resolution, the United States’s written summary shall be deemed
 

its initial filing with this Court regarding the dispute. The
 

United States may submit a response to the petition within forty-


five (45) calendar days of filing.
 

127. The time periods set out in this Section may be
 

shortened or lengthened upon motion to the Court of one of the
 

Parties to the dispute, explaining the Party’s basis for seeking
 

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such a scheduling modification. 


128. This Court shall not draw any inferences nor establish
 

any presumptions adverse to either Party as a result of
 

invocation of this Section or the Parties’ inability to reach
 

agreement.
 

129. As part of the resolution of any dispute under this
 

Section, in appropriate circumstances the Parties may agree, or
 

this Court may order, an extension or modification of the
 

schedule for the completion of the activities required under this
 

Consent Decree to account for the delay that occurred as a result
 

of dispute resolution. SRP shall be liable for stipulated
 

penalties for its failure thereafter to complete the work in
 

accordance with the extended or modified schedule, provided that
 

SRP shall not be precluded from asserting that a Force Majeure
 

Event has caused or may cause a delay in complying with the
 

extended or modified schedule.
 

130. The Court shall decide all disputes pursuant to
 

applicable principles of law for resolving such disputes. In
 

their filings with the Court under Paragraph 126, the Parties
 

shall state their respective positions as to the applicable
 

standard of law for resolving the particular dispute.
 

XVI. PERMITS
 

131. Unless expressly stated otherwise in this Consent
 

Decree, in any instance where otherwise applicable law or this
 

Consent Decree requires SRP to secure a permit to authorize
 

construction or operation of any device, including all
 

preconstruction, construction, and operating permits required
 

under State law, SRP shall make such application in a timely
 

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manner. The United States will use its best efforts to
 

expeditiously fulfill its role in reviewing all permit
 

applications submitted by SRP in order to meet the requirements
 

of this Consent Decree.
 

132. When permits are required, SRP shall complete and
 

submit applications for such permits to Arizona DEQ to allow
 

sufficient time for all legally required processing and review of
 

the permit request, including requests for additional information
 

by Arizona DEQ. Any failure by SRP to submit a timely permit
 

application for Unit 1 and/or Unit 2 shall bar any use by SRP of
 

Section XIV (Force Majeure) of this Consent Decree, where a Force
 

Majeure claim is based on permitting delays.
 

133. Notwithstanding the reference to SRP’s Title V permit
 

for CGS in this Consent Decree, the enforcement of that permit
 

shall be in accordance with its own terms and the Act. SRP’s
 

Title V permit for CGS shall not be enforceable under this
 

Consent Decree, although any term or limit established by or
 

under this Consent Decree shall be enforceable under this Consent
 

Decree regardless of whether such term has or will become part of
 

a Title V permit, subject to the terms of Section XXVI
 

(Conditional Termination of Enforcement Under Consent Decree) of
 

this Consent Decree. 


134. Within one hundred eighty (180) days after entry of
 

this Consent Decree, SRP shall amend any applicable Title V
 

permit application, or apply for amendments of its Title V
 

permit, to include a schedule for all unit-specific and plant-


specific performance, operational, maintenance, and control
 

technology requirements established by this Consent Decree
 

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including, but not limited to, Emission Rates, Removal
 

Efficiencies, the 365-day Plant-Wide Rolling NOx Tonnage
 

Limitation, and the requirements pertaining to the surrender of
 

SO2 Allowances.
 

135. Within one (1) year from the commencement of operation
 

of the final pollution control device to be installed on a Unit
 

under this Consent Decree, SRP shall either apply to permanently
 

include the requirements and limitations enumerated in this
 

Consent Decree into a federally enforceable permit or request a
 

site-specific amendment to the Arizona SIP to include the
 

requirements and limitations enumerated in this Consent Decree. 


The permit or Arizona SIP amendment shall require compliance with
 

the following: (a) any applicable Emission Rate or Removal
 

Efficiency, (b) the 365-day Plant-Wide Rolling NOx Tonnage
 

Limitation, and (c) the SO2 Allowance surrender requirements set
 

forth in this Consent Decree. For purposes of this Consent
 

Decree, the federally enforceable permit must be issued by
 

Arizona DEQ under its authority to issue permits pursuant to the
 

Arizona SIP and not solely under Arizona's authority to issue
 

permits pursuant to its Title V permit program.
 

136. SRP shall provide the United States with a copy of
 

each application for a federally enforceable permit or Arizona
 

SIP amendment, as well as a copy of any permit proposed as a
 

result of such application, to allow for timely participation in
 

any public comment opportunity.
 

137. If SRP sells or transfers to an entity unrelated to
 

SRP (“Third Party Purchaser”) part or all of its Ownership
 

Interest covered under this Consent Decree, SRP shall comply with
 

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the requirements of Paragraphs 145 through 148 of this Consent
 

Decree with regard to that Ownership Interest prior to any such
 

sale or transfer unless, following any such sale or transfer, SRP
 

remains the holder of the permit for such facility.
 

XVII. INFORMATION COLLECTION AND RETENTION
 

138. Any authorized representative of the United States,
 

including its attorneys, contractors, and consultants, upon
 

presentation of credentials, shall have a right of entry upon the
 

premises of CGS Unit 1 and Unit 2 at any reasonable time for the
 

purpose of:
 

a. monitoring the progress of activities required under 

this Consent Decree; 

b. verifying any data or information submitted to the 

United States in accordance with the terms of this 

Consent Decree; 

c. obtaining samples and, upon request, splits of any 

samples taken by SRP or its representatives, 

contractors, or consultants; and 

d. assessing SRP’s compliance with this Consent Decree. 

139. SRP shall retain, and instruct its contractors and 

agents to preserve, all non-identical copies of all records and
 

documents (including records and documents in electronic form)
 

now in its or its contractors’ or agents’ possession or control,
 

and that directly relate to SRP’s performance of its obligations
 

under this Consent Decree for the following periods: (a) until
 

December 31, 2020 for records concerning physical or operational
 

changes undertaken in accordance with Section IV (NOx Emission
 

Reductions and Controls) and Section V (SO2 Emission Reductions
 

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and Controls); and (b) until December 31, 2017 for all other
 

records. This record retention requirement shall apply
 

regardless of any corporate document retention policy to the
 

contrary.
 

140. All information and documents submitted by SRP
 

pursuant to this Consent Decree shall be subject to any requests
 

under applicable law providing public disclosure of documents
 

unless (a) the information and documents are subject to legal
 

privileges or protection or (b) SRP claims and substantiates in
 

accordance with 40 C.F.R. Part 2 that the information and
 

documents contain confidential business information.
 

141. Nothing in this Consent Decree shall limit the
 

authority of the EPA to conduct tests and inspections at SRP’s
 

facilities under Section 114 of the Act, 42 U.S.C. § 7414, or any
 

other applicable federal laws, regulations, or permits.
 

XVIII. NOTICES
 

142. Unless otherwise provided herein, whenever
 

notifications, submissions, or communications are required by
 

this Consent Decree, they shall be made in writing and addressed
 

as follows:
 

As to the United States of America:
 

Chief, Environmental Enforcement Section 


Environment and Natural Resources Division 


U.S. Department of Justice 


P.O. Box 7611, Ben Franklin Station 

Washington, DC 20044-7611 

DJ# 90-5-2-1-09174 

and
 

Director, Air Enforcement Division
 

Office of Enforcement and Compliance Assurance
 

U.S. Environmental Protection Agency
 

Ariel Rios Building [2242A]
 

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1200 Pennsylvania Avenue, N.W. 


Washington, DC 20460
 

and
 

Director, Air Division
 

U.S. EPA Region 9
 

75 Hawthorne Street [Air-1] 


San Francisco, CA 94105
 

As to SRP:
 

Manager, Environmental Services
 

Salt River Project 


Environmental, PAB352 


1521 N. Project Dr.
 

Tempe, AZ 85281 


and
 

Corporate Counsel
 

Salt River Project
 

Legal Services Department, PAB207
 

1521 N. Project Dr.
 

Tempe, AZ 85281
 

143. All notifications, communications, or submissions made
 

pursuant to this Section shall be sent either by: (a) overnight
 

mail or overnight delivery service with signature required for
 

delivery, or (b) certified or registered mail, return receipt
 

requested. All notifications, communications, and transmissions
 

(a) sent by overnight, certified, or registered mail shall be
 

deemed submitted on the date they are postmarked, or (b) sent by
 

overnight delivery service shall be deemed submitted on the date
 

they are delivered to the delivery service. 


144. Either Party may change either the notice recipient or
 

the address for providing notices to it by serving the other
 

Party with a notice setting forth such new notice recipient or
 

address.
 

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XIX. SALES OR TRANSFERS OF OWNERSHIP INTERESTS
 

145. If SRP proposes to sell or transfer an Ownership
 

Interest to another entity (a “Third Party Purchaser”), SRP shall
 

advise the Third Party Purchaser in writing of the existence of
 

this Consent Decree prior to such sale or transfer, and shall
 

send a copy of such written notification to the United States
 

pursuant to Section XVIII (Notices) of this Consent Decree at
 

least sixty (60) days before such proposed sale or transfer. 


146. No sale or transfer of an Ownership Interest shall
 

take place before the Third Party Purchaser and the United States
 

have executed, and the Court has approved, a modification
 

pursuant to Section XXII (Modification) of this Consent Decree
 

making the Third Party Purchaser a party to this Consent Decree
 

and jointly and severally liable with SRP for all the
 

requirements of this Consent Decree that may be applicable to the
 

transferred or purchased Ownership Interests.
 

147. This Consent Decree shall not be construed to impede
 

the transfer of any Ownership Interests between SRP and any Third
 

Party Purchaser so long as the requirements of this Consent
 

Decree are met. This Consent Decree shall not be construed to
 

prohibit a contractual allocation – as between SRP and any Third
 

Party Purchaser of Ownership Interests – of the burdens of
 

compliance with this Consent Decree, provided that both SRP and
 

such Third Party Purchaser shall remain jointly and severally
 

liable to the United States for the obligations of this Consent
 

Decree applicable to the transferred or purchased Ownership
 

Interests.
 

148. If the United States agrees, the United States, SRP,
 

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and the Third Party Purchaser that has become a party to this
 

Consent Decree pursuant to Paragraph 146, may execute a
 

modification that relieves SRP of its liability under this
 

Consent Decree for, and makes the Third Party Purchaser liable
 

for, all obligations and liabilities applicable to the purchased
 

or transferred Ownership Interests. Notwithstanding the
 

foregoing, however, SRP may not assign, and may not be released
 

from, any obligation under this Consent Decree that is not
 

specific to the purchased or transferred Ownership Interests,
 

including the obligations set forth in Sections VIII
 

(Environmental Projects) and IX (Civil Penalty). SRP may propose
 

and the United States may agree to restrict the scope of the
 

joint and several liability of any purchaser or transferee for
 

any obligations of this Consent Decree that are not specific to
 

the transferred or purchased Ownership Interests, to the extent
 

such obligations may be adequately separated in an enforceable
 

manner.
 

XX. EFFECTIVE DATE
 

149. The effective date of this Consent Decree shall be the
 

date upon which this Consent Decree is entered by the Court.
 

XXI. RETENTION OF JURISDICTION
 

150. The Court shall retain jurisdiction of this case after
 

entry of this Consent Decree to enforce compliance with the terms
 

and conditions of this Consent Decree and to take any action
 

necessary or appropriate for its interpretation, construction,
 

execution, modification, or adjudication of disputes. During the
 

term of this Consent Decree, either Party to this Consent Decree
 

may apply to the Court for any relief necessary to construe or
 

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effectuate this Consent Decree.
 

XXII. MODIFICATION
 

151. The terms of this Consent Decree may be modified only 


by a subsequent written agreement signed by the United States and
 

SRP. Where the modification constitutes a material change to any
 

term of this Consent Decree, it shall be effective only upon
 

approval by the Court.
 

XXIII. GENERAL PROVISIONS
 

152. This Consent Decree is not a permit. Compliance with
 

the terms of this Consent Decree does not guarantee compliance
 

with all applicable federal, state, or local laws or regulations.
 

The emission rates and removal efficiencies set forth herein do
 

not relieve SRP from any obligation to comply with other state
 

and federal requirements under the Clean Air Act, including SRP’s
 

obligation to satisfy any State modeling requirements set forth
 

in the Arizona SIP.
 

153. This Consent Decree does not apply to any claim(s) of
 

alleged criminal liability.
 

154. In any subsequent administrative or judicial action
 

initiated by the United States for injunctive relief or civil
 

penalties relating to CGS as covered by this Consent Decree, SRP
 

shall not assert any defense or claim based upon principles of
 

waiver, res judicata, collateral estoppel, issue preclusion,
 

claim preclusion, or claim splitting, or any other defense based
 

upon the contention that the claims raised by the United States
 

in the subsequent proceeding were brought, or should have been
 

brought, in the instant case; provided, however, that nothing in
 

this Paragraph is intended to affect the validity of Section X
 

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(Resolution of Past Civil Claims).
 

155. Except as specifically provided by this Consent
 

Decree, nothing in this Consent Decree shall relieve SRP of its
 

obligation to comply with all applicable federal, state, and
 

local laws and regulations. Subject to the provisions in Section
 

X (Resolution of Past Civil Claims), nothing contained in this
 

Consent Decree shall be construed to prevent or limit the rights
 

of the United States to obtain penalties or injunctive relief
 

under the Act or other federal, state, or local statutes,
 

regulations, or permits.
 

156. Each limit and/or other requirement established by or
 

under this Consent Decree is a separate, independent requirement.
 

157. Performance standards, emissions limits, and other
 

quantitative standards set by or under this Consent Decree must
 

be met to the number of significant digits in which the standard
 

or limit is expressed. For example, an Emission Rate of 0.100 is
 

not met if the actual Emission Rate is 0.101. SRP shall round the
 

fourth significant digit to the nearest third significant digit,
 

or the third significant digit to the nearest second significant
 

digit, depending upon whether the limit is expressed to three or
 

two significant digits. For example, if an actual Emission Rate
 

is 0.1004, that shall be reported as 0.100, and shall be in
 

compliance with an Emission Rate of 0.100, and if an actual
 

Emission Rate is 0.1005, that shall be reported as 0.101, and
 

shall not be in compliance with an Emission Rate of 0.100.
 

Removal Efficiency for SO2 is expressed to 3 significant figures
 

- 95.0%. The 95.0% Removal Efficiency requirement is met if, for
 

example, the calculated Removal Efficiency is 94.95%. However,
 

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95.0% Removal Efficiency requirement is not met if, for example,
 

the calculated Removal Efficiency is 94.94%. SRP shall report
 

data to the number of significant digits in which the standard or
 

limit is expressed.
 

158. This Consent Decree does not limit, enlarge, or affect
 

the rights of either Party to this Consent Decree as against any
 

third parties.
 

159. This Consent Decree constitutes the final, complete
 

and exclusive agreement and understanding between the Parties
 

with respect to the settlement embodied in this Consent Decree,
 

and supercedes all prior agreements and understandings between
 

the Parties related to the subject matter herein. No document,
 

representation, inducement, agreement, understanding, or promise
 

constitutes any part of this Consent Decree or the settlement it
 

represents, nor shall they be used in construing the terms of
 

this Consent Decree.
 

160. Each Party to this action shall bear its own costs and
 

attorneys' fees. 


XXIV. SIGNATORIES AND SERVICE
 

161. Each undersigned representative of the Parties
 

certifies that he or she is fully authorized to enter into the
 

terms and conditions of this Consent Decree and to execute and
 

legally bind to this document the Party he or she represents.
 

162. This Consent Decree may be signed in counterparts, and
 

such counterpart signature pages shall be given full force and
 

effect.
 

163. Each Party hereby agrees to accept service of process
 

by mail with respect to all matters arising under or relating to
 

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this Consent Decree and to waive the formal service requirements
 

set forth in Rule 4 of the Federal Rules of Civil Procedure and
 

any applicable Local Rules of this Court including, but not
 

limited to, service of a summons.
 

XXV. PUBLIC COMMENT
 

164. Both Parties agree and acknowledge that final approval
 

by the United States and entry of this Consent Decree is subject
 

to the procedures of 28 C.F.R. § 50.7, which provides for notice
 

of the lodging of this Consent Decree in the Federal Register, an
 

opportunity for public comment, and the right of the United
 

States to withdraw or withhold consent if the comments disclose
 

facts or considerations which indicate that this Consent Decree
 

is inappropriate, improper, or inadequate. SRP shall not oppose
 

entry of this Consent Decree by this Court or challenge any
 

provision of this Consent Decree unless the United States has
 

notified SRP, in writing, that the United States no longer
 

supports entry of this Consent Decree.
 

XXVI. CONDITIONAL TERMINATION OF ENFORCEMENT UNDER CONSENT DECREE
 

165. Termination as to completed tasks. As soon as SRP
 

completes a construction project or any other requirement of this
 

Consent Decree that is not ongoing or recurring, SRP may, by
 

motion to this Court, seek termination of the provision or
 

provisions of this Consent Decree that imposed the requirement.
 

166. Conditional termination of enforcement through this
 

Consent Decree. Subject to the provisions of Paragraph 167,
 

after SRP:
 

a.	 has successfully completed construction, and has
 

maintained operation, of all pollution controls as
 

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required by this Consent Decree for a period of two
 

years; and
 

b.	 has obtained all the final permits required by Section
 

XVI (Permits) of this Consent Decree covering both Unit
 

1 and Unit 2 that include as federally enforceable
 

permit terms, all of the Unit performance and other
 

requirements specified in this Consent Decree; 


then SRP may so certify these facts to the United States and this
 

Court. If the United States does not object in writing with
 

specific reasons within forty-five (45) days of receipt of SRP’s
 

certification, then, for any violations of this Consent Decree
 

that occur after the filing of notice, the United States shall
 

pursue enforcement of the requirements contained in the Title V
 

permit through the applicable Title V permit and/or other
 

enforcement authorities and not through this Consent Decree.
 

167. Resort to enforcement under this Consent Decree.
 

Notwithstanding Paragraph 166, if enforcement of a provision in
 

this Consent Decree cannot be pursued by the United States under
 

the applicable Title V permit, or if a requirement of this
 

Consent Decree was intended to be part of a Title V Permit and
 

did not become or remain part of such permit, then such
 

requirement may be enforced under the terms of this Consent
 

Decree at any time. 


XXVII. FINAL JUDGMENT
 

168. Upon approval and entry of this Consent Decree by the
 

Court, this Consent Decree shall constitute a final judgment
 

between the United States and SRP.
 

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______________________________

______________________________

Signature Page for United States of America v. Salt River Project

Agricultural Improvement and Power District Consent Decree 

FOR THE UNITED STATES DEPARTMENT OF JUSTICE 

Respectfully submitted, 

RONALD J. TENPAS 

Assistant Attorney General

Environment and Natural Resources

 Division 

United States Department of Justice 

W. BENJAMIN FISHEROW 

Deputy Chief

Environmental Enforcement Section 

Environment and Natural Resources

 Division 

P.O. Box 7611 

Washington, DC 20044-7611

(202) 514-2750 

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______________________________

Signature Page for United States of America v. Salt River Project

Agricultural Improvement and Power District Consent Decree 

FOR THE UNITED STATES DEPARTMENT OF JUSTICE 

DIANE J. HUMETEWA 

United States Attorney

District of Arizona 

SUE A. KLEIN 

Assistant United States Attorney

Two Renaissance Square

40 N. Central Avenue, Suite 1200

Phoenix, AZ 85004-4408

Telephone: (602) 514-7500 

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______________________________

_____________________________

______________________________

Signature Page for United States of America v. Salt River Project

Agricultural Improvement and Power District Consent Decree 

FOR THE UNITED STATES ENVIRONMENTAL PROTECTION AGENCY 

Respectfully submitted, 

GRANTA Y. NAKAYAMA 

Assistant Administrator 

Office of Enforcement and

 Compliance Assurance

United States Environmental

 Protection Agency 

ADAM M. KUSHNER 

Director, Air Enforcement Division

Office of Enforcement and

 Compliance Assurance

United States Environmental

 Protection Agency 

ILANA S. SALTZBART 

Attorney-Advisor

United States Environmental

 Protection Agency

1200 Pennsylvania Ave, N.W. (2242A)

Washington, DC 20460 

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______________________________

_______________________________

Signature Page for United States of America v. Salt River Project

Agricultural Improvement and Power District Consent Decree 

FOR THE UNITED STATES ENVIRONMENTAL PROTECTION AGENCY 

Respectfully submitted, 

WAYNE NASTRI 

Regional Administrator, Region 9

United States Environmental

 Protection Agency 

ALLAN ZABEL 

Senior Counsel 

United States Environmental

 Protection Agency, Region 9

75 Hawthorne St. (ORC-2)

San Francisco, CA 94105 

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 _______________________________

_______________________________ 

_______________________________

_______________________________

_______________________________

Signature Page for United States of America v. Salt River Project

Agricultural Improvement and Power District Consent Decree 

FOR SALT RIVER PROJECT AGRICULTURAL IMPROVEMENT AND POWER 

DISTRICT 

By:	 _______________________________

President / Vice President 

(Printed Name) 

Attest and Countersign: 

Secretary / Assistant Secretary 

(Printed Name) 

Reviewed by SRP Legal Services Department 

(Signed Name) 

(Printed Name) 

Date:_______________________________ 

66
 
 

Appendix A
 


Environmental Projects
 


In compliance with, and in addition to, the requirements in Section VIII of this Consent 

Decree (Environmental Projects), SRP shall comply with the requirements of this Appendix to 

ensure that the benefits of the $4 million in Project Dollars are achieved. 

I.	 Overall Environmental Projects Schedule and Budget 

A.	 Within one hundred twenty (120) days from entry of this Consent Decree, as 

further described below, SRP shall submit plans to EPA for review and approval 

for spending the $4 million in Project Dollars specified in this Appendix in 

accordance with the deadlines established in this Appendix. EPA shall determine, 

prior to approval, that all Projects are consistent with federal law. 

B.	 SRP may, at its election, consolidate the plans required by this Appendix into a 

single plan. 

C.	 Beginning one hundred twenty (120) days from entry of this Consent Decree, and 

continuing annually thereafter until completion of each Project (including any 

applicable periods of demonstration or testing), SRP shall provide EPA with 

written reports detailing the progress of each Project, including an accounting of 

Project Dollars spent to date. 

D.	 As required by Paragraph 86 of the Consent Decree, within sixty (60) days 

following the completion of each Project required under this Consent Decree 

(including any applicable periods of demonstration or testing), SRP shall submit 

to the United States a report that documents the date that the Project was 

completed, SRP’s results of implementing the Project, including the emission 

reductions or other environmental benefits achieved, and the Project Dollars 

expended by SRP in implementing the Project. 

E.	 Upon EPA’s approval of the plans required by this Appendix, SRP shall complete 

the Environmental Projects according to the approved plans. Nothing in the 

Consent Decree or this Appendix shall be interpreted to prohibit SRP from 

completing the Environmental Projects before the deadlines specified in the 

schedule of an approved plan. 

II.	 Clean Diesel School Bus Retrofit Project 

A.	 Within one hundred twenty (120) days from entry of this Consent Decree, SRP 

shall submit to EPA for review and approval pursuant to Section XII (Review and 

Approval of Submittals) of this Consent Decree a plan to retrofit in-service public 

school bus diesel engines with emission control equipment further described in 

Appendix A - 1 
this Section, designed to reduce emissions of particulates and/or ozone precursors 

(the “Clean Diesel School Bus Retrofit Project”) and fund the operation and 

maintenance of the retrofit equipment for the time-period described below. This 

Project shall include, where necessary, techniques and infrastructure needed to 

support such retrofits. SRP shall spend no less than $1.25 million in Project 

Dollars in performing this Clean Diesel School Bus Retrofit Project. SRP shall 

complete the installation of the retrofit equipment no later than December 31, 

2010, and ensure that the recipients operate and maintain the retrofit equipment 

from the date of installation through December 31, 2015, by providing funding 

for operation and maintenance as described in Section II.B.7, below. 

B.	 The plan shall also satisfy the following criteria: 

1.	 Involve public school bus fleets located in the Phoenix metropolitan area 

(including the City of Phoenix, and the cities and towns in Maricopa 

County, Pinal County, and Yavapai County). 

2.	 Provide for the retrofit of public school bus diesel engines with EPA or 

California Air Resources Board (“CARB”) verified emissions control 

technologies to achieve the greatest measurable mass reductions of 

particulates and/or ozone precursors for the fleet of school buses in the 

public school district(s) that participate(s) in this Project. Depending upon 

the particular EPA or CARB verified emissions control technology 

selected, the retrofit school bus diesel engines must achieve emission 

reductions of particulates and/or ozone precursors by 30%-90%, as 

measured from the pre-retrofit emissions for the particular diesel school 

bus. 

3.	 Describe the process SRP will use to determine the most appropriate 

emissions control technology for each particular school bus diesel engine 

that will achieve the greatest mass reduction of particulates and/or ozone 

precursors. In making this determination, SRP must take into account the 

particular operating criteria required for the EPA or CARB verified 

emissions control technology to achieve the verified emissions reductions. 

4.	 Provide for the retrofit of school bus diesel engines with either: (a) diesel 

particulate filters or (b) diesel oxidation catalysts and closed crankcase 

ventilation systems. 

5.	 Describe the process SRP will use to notify public school districts within 

the geographic area specified in Section II.B.1 that their fleet of school 

buses may be eligible to participate in the Clean Diesel School Bus 

Retrofit Project and to solicit their interest in participating in the Project. 

Appendix A - 2 
6.	 Describe the process and criteria SRP will use to select the particular 

public school districts to participate in this Project, consistent with the 

requirements of this Section. 

7.	 For each of the recipient public school districts, describe the amount of 

Project Dollars that will cover the costs associated with: (a) purchasing the 

verified emissions control technology, (b) installation of the verified 

emissions control technology (including datalogging), (c) training costs 

associated with repair and maintenance of the verified emissions control 

technology (including technology cleaning and proper disposal of waste 

generated from cleaning), and (d) the incremental costs for repair and 

maintenance of the retrofit equipment from the date of installation through 

December 31, 2015, including the costs associated with the proper 

disposal of the waste generated from cleaning the verified emissions 

control technology. This Project shall not include costs for normal repair 

or operation of the retrofit school bus. 

8.	 Include a mechanism to ensure that recipients of the retrofit equipment 

will bind themselves to follow the operating criteria required for the 

verified emissions control technology to achieve the verified emissions 

reductions and properly maintain the retrofit equipment installed in 

connection with the Project for the period beginning on the date the 

installation is complete through December 31, 2015. 

9.	 Describe the process SRP will use for determining which school buses in a 

particular public school fleet will be retrofit with the verified emissions 

control technology, consistent with the criteria specified in Section II.B.2. 

10.	 Ensure that recipient public school district(s), or their funders, do not 

otherwise have a legal obligation to reduce emissions through the retrofit 

of school bus diesel engines. 

11.	 For any third party with whom SRP might contract to carry out this 

Project, establish minimum standards that include prior experience in 

arranging retrofits, and a record of prior ability to interest and organize 

fleets, school districts, and community groups to join a clean diesel 

program. 

12.	 Ensure that the recipient public school district(s) comply with local, state, 

and federal requirements for the disposal of the waste generated from the 

verified emissions control technology and follow CARB’s guidance for 

the proper disposal of such waste. 

13.	 Include a schedule and budget for completing each portion of the Project, 

Appendix A - 3 
 

including funding for operation and maintenance of the retrofit equipment 

through December 31, 2015. 

C.	 In addition to the information required to be included in the report pursuant to 

Section I.D, above, SRP shall also describe the school districts where it 

implemented this Project; the particular types of verified emissions control 

technology (and the number of each type) that it installed pursuant to this Project; 

the type, year, and horsepower of each retrofit school bus; an estimate of the 

number of school children effected by this Project, and the basis for this estimate; 

and an estimate of the emission reductions for each retrofit school bus (using the 

manufacturer’s estimated reductions for the particular verified emissions control 

technology), including particulates, hydrocarbons, carbon monoxide, and nitrogen 

oxides. 

D.	 Upon EPA’s approval of the plan, SRP shall complete the Clean Diesel School 

Bus Retrofit Project according to the approved plan and schedule. 

III.	 Solar Photovoltaic Project 

A.	 Within one hundred twenty (120) days from entry of this Consent Decree, SRP 

shall submit to EPA for review and approval pursuant to Section XII (Review and 

Approval of Submittals) of this Consent Decree a plan to install conventional 

fixed flat panel solar photovoltaics and associated equipment (“PV System”) on 

school buildings in Arizona and to fund the maintenance of such PV Systems for 

a minimum of 10 years following approval of the plan (“PV Project”). SRP shall 

spend no less than $2.0 million in Project Dollars in performing this PV Project. 

SRP shall complete the PV System installations no later than December 31, 2010, 

and shall maintain the PV Systems for a minimum of ten (10) years following 

approval of the plan. 

B.	 A PV System shall, at a minimum, consist of: (1) the installation of solar panels at 

a single location producing at least 10 kilowatts direct current; (2) a grid-tied 

inverter, appropriately sized for the capacity of the solar panels installed at the 

location; (3) the appropriate solar panel mounting equipment for the particular 

school selected, i.e., roof mount or ground mount; (4) wiring, conduit, and 

associated switchgear and metering required for interconnecting the solar 

generator to the grid; and (5) appropriate software to enable the school students 

and staff to monitor the output in kilowatt-hours (both before and after the 

inverter). SRP shall purchase a ten-year service warrantee for each PV System 

installed pursuant to the PV Project. 

C. The plan shall also satisfy the following criteria: 

1.	 Involve two public school districts in the vicinity of Coronado Generating 

Appendix A - 4 
Station (e.g., St. Johns, Springerville, Eagar, Show Low) and at least two 

public school districts in the Phoenix metropolitan area (including the City 

of Phoenix, and the cities and towns in Maricopa County, Pinal County, 

and Yavapai County). Specifically, two PV Systems will be installed in 

the vicinity of Coronado Generating Station and the remainder in the 

Phoenix metropolitan area. 

2.	 Include a schedule and budget for completing each portion of the PV 

Project, including installation and maintenance costs for up to ten (10) 

years following approval of the plan. 

3.	 Describe the process SRP will use to notify public school districts 

identified in III.C.1, above, that they are eligible to participate in the PV 

Project and to solicit their interest in participating in the PV Project. 

4.	 Describe the process and criteria SRP will use to select the public school 

buildings where SRP will install the PV Systems. 

5.	 Identify any person or entity other than SRP that will be involved in the 

PV Project. SRP shall describe the third party’s role in the Project and the 

basis for asserting that such entity is able and suited to perform the 

intended role. For purposes of this Project, third parties shall only include 

non-profits, state and local agencies, or universities. Any proposed third 

party must be legally authorized to perform the proposed role and to 

receive Project Dollars. 

D.	 In addition to the information required to be included in the report pursuant to 

Section I.D, above, SRP shall also identify the school buildings where the PV 

Systems were installed, how many total panels, in kilowatts, were installed, the 

success of the Project in terms of efficiency and kilowatts generated per year, and 

any lessons learned. 

E.	 Upon EPA’s approval of the plan, SRP shall complete the PV Project according 

to the approved plan and schedule. 

IV.	 Wood Stove Changeout Project 

A.	 Within one hundred twenty (120) days from entry of this Consent Decree, SRP 

shall submit to EPA for review and approval pursuant to Section XII (Review and 

Approval of Submittals) of this Consent Decree a plan to sponsor a wood stove 

changeout campaign that a state, local, or tribal air pollution control agency (“air 

pollution control agency) or third-party non-profit will agree to implement in an 

area that would benefit from reductions of fine particle pollution and/or hazardous 

air pollutants by replacing pre-1988 wood stoves with EPA-certified wood-stoves 

Appendix A - 5 
and/or cleaner burning, more energy-efficient hearth appliances (e.g., wood pellet, 

gas, or propane stoves) (“Wood Stove Changeout Project”). SRP shall spend no 

less than $750,000 in Project Dollars in performing this Wood Stove Changeout 

Project, and shall complete the Project no later than December 31, 2011. 

B.	 The Wood Stove Changeout Project that SRP sponsors shall provide information 

(including, educational efforts and outreach regarding clean-burning alternatives 

to pre-1988 wood stoves and proper operation of the hearth appliances) and 

incentives through rebates, discounts, and in some instances, actual replacement 

of pre-1988 wood stoves for income-qualified residential homeowners, to 

encourage residential homeowners to replace their old, higher polluting and less 

energy efficient wood stoves (pre-1988 wood stoves) with cleaner burning, more 

energy efficient hearth appliances like wood pellet stoves, EPA-certified wood 

stoves, gas stoves, or propane stoves. 

C.	 SRP shall sponsor the implementation of the Wood Stove Changeout Project in 

areas in the vicinity of Coronado Generating Station (e.g., St. Johns, 

Springerville, Eagar, Show Low) that promise significant environmental benefit 

from the Wood Stove Changeout Project. In determining the specific areas to 

implement this Project within the aforementioned geographic area, SRP shall give 

priority to areas with high amounts of air pollution, especially particle pollution 

and/or hazardous air pollutants, areas located within a geography and topography 

that makes it susceptible to high levels of particle pollution, or areas that have a 

significant number of pre-1988 wood-burning appliances. 

D.	 The air pollution control agency(ies) and/or non-profit(s) that SRP selects shall 

implement the Wood Stove Changeout Project consistent with the materials 

available on EPA’s website at http://www.epa.gov/woodstoves/index.html. 

E.	 The plan shall also satisfy the following criteria: 

1.	 Identify the air pollution control agency(ies) and/or non-profit(s) selected 

to implement the Wood Stove Changeout Project. 

2.	 Describe the schedule and budgetary increments in which SRP shall 

provide the necessary funding to the air pollution control agency(ies) 

and/or non-profits(s) to implement the Wood Stove Changeout Project. 

3.	 Ensure that the air pollution control agency(ies) and/or non-profit(s) will 

implement the Wood Stove Changeout Project in accordance with the 

requirements of this Appendix, and that the Project Dollars will be used to 

support the actual replacement of pre-1988 wood stoves currently used as 

the primary or secondary source of residential heat with a cleaner burning, 

more energy efficient hearth appliance (i.e., wood pellet stove, EPAAppendix A - 6 
certified wood stove, gas stove, or propane stove). SRP shall limit the use 

of Project Dollars for administrative costs associated with implementation 

of the program to no greater than 10% of the Project Dollars SRP provides 

to a specific air pollution control agency and/or non-profit. 

4.	 Describe all of the elements of the Wood Stove Changeout Project that the 

air pollution control agency(ies) and/or non-profit(s) will implement, 

including the type and amount of the incentive that will be made available 

to residential homeowners through the Wood Stove Changeout Project. If 

SRP proposes to fund the actual replacement of a pre-1988 wood stove for 

income-qualified residential homeowners, SRP shall describe the number 

of energy efficient hearth appliances it intends to make available, the cost 

per unit, and the criteria the air pollution control agency(ies) and/or nonprofit(s) will use to determine which residential homeowners should be 

eligible for actual stove replacement. 

5.	 If applicable, identify any organizations with which the air pollution 

control agency(ies) and/or non-profit(s) will partner to implement the 

Project, including such organizations as: the Hearth, Patio, and Barbecue 

Association of America, the Chimney Safety Institute of America, a local 

chapter of the American Lung Association, Tribal organizations, 

individual stove retailers, propane dealers, facilities that will dispose of 

old stoves so that they cannot be resold or reused, housing assistance 

agencies, local fire departments, local health organizations, and local 

green energy organizations. 

6.	 Describe how the air pollution control agency(ies) and/or non-profit(s) 

will ensure that the pre-1988 wood stoves will be properly recycled or 

disposed. 

F.	 Upon EPA’s approval of the plan, SRP shall complete the Wood Stove Changeout 

Project according to the approved plan and schedule. 

Appendix A - 7