April 21, 2014 Abt Associates | Assessment of Administrative Costs for BPJ

- Based CWA 316(b) Permitting | pg 1

Date April 21 , 201 4

To The 316(b) Existing Facilities Final Rule Record

From Abt Associates
Subject Assessment of Administrative Costs for BPJ

- Based CWA 316(b) Permitting



### 1 Introduction
Section 316 (b) of the Clean Water Act (CWA) requires that the location, design, construction and capacity of cooling water intake structures reflect t he best technology available (B T A ) for minimizing adverse environmental impact (U.S. EPA, 2014). These requirements for CWIS are implemented through National Pollutant Discharge Elimination Permits ( NPDES ) permits . Without a national regulation in place, the NPDES permits for cooling wate r intake structure s must be established on a case

- by

- case basis using Best Professional Judgment (BPJ)

. Where BPJ is used, the permit writer must consider the same statutory factors EPA would use for a national regulation, but they are applied to the circu mstances specific to the permittee ( U.S. EPA, 2010)

. EPA is p romulgating requirements under s ection 316(b) of the CWA for existing power generating, manufacturing and industrial facilities. In its assessment of costs for the final rule, EPA estimated the
costs to permitting authorities and facilities for administrative activities to determine compliance requirements, obtain and approve permits
, and perform and review monitoring and reporting. EPA did not account for the costs that permitting authorities an d facilities otherwise incur for BPJ

- based permit activity , as currently occurs in the absence of a national 316(b) regulation. To the extent that permitting authorities and facilities incur these costs, the costs reported in the Economic Analysis ( EA ) of the regulation are overstated . This is because the BPJ costs would be subtracted from the estimated administrative costs to calculate society’s incremental costs for permit development and administration. It is possible that the aggregate administrative co sts for BPJ

- based permitting, now being incurred by permitting authorities and facilities in the absence of a national rule, exceed the costs EPA estimated in the EA for permit administration. In th at case, the rule’s incremental costs for permit administr ation would be negative

. This memorandum does not attempt to quantify the burden and costs associated with establishing 316(b)

- related requirements for NPDES permits
, but instead
, reviews the inclusion of BPJ

based requirements in NPDES permits and qualita tively assesses the associated burden. This effort required research on current general and individual NPDES permits and permitting programs to assess whether these permits contain requirements for impingement and/or entrainmen t. We reviewed this permit information for a sample of 1 8 states 1 . We selected the S tates for this review on the basis of regional diversity , choos ing at least two state s from each census region while also including S tates known to have BPJ permitting for 316(b) requirements

. This research indicate s a wide range in how States and EPA Regions address 316(b) requirements in NPDES permits. At the lower end of the scale, research indicates that permits in 8 of the 1 8 S tates are silent on 316(b) requirements. However, permits in the rema ining 10 S tates include 316(b) requirements,

1 Including Massachusetts and New Hampshire, which do not have delegated permit administration authority under the CWA. EPA Region 1 administers NPDES permits for these states. 

# Memorandum Environment and ResourcesApril 21, 2014 Abt Associates | Assessment of Administrative Costs for BPJ

- Based CWA 316(b) Permitting | pg 2

which indicates some level of BPJ

- based permitting activity, and associated administrative burden and
cost. The character of these requirements, and the burden that permitting authorities and facilities would fa ce in developing and administering BPJ

- based permits, varies substantially across these S tates. Some S tates have relatively modest data and permit processing requirements in general permits, while others require, either in general permits or individual per mits, a higher standard of information submission and process for determining 316(b) requirements to be included in NPDES permits. In these cases

– in which facilities submit information as part of the permitting process and permitting authorities review t his information and make permitting decisions based on the reviews

– it is clear that facilities and permitting authorities are now perform ing activities that are similar to those that will be required by the final rule. Based on this assessment, EPA’s ana lysis of administrative cost s for the final rule is likely an overestimate because it does not subtract the costs currently incurred for these permitting activities and therefore is not a true incremental cost. The remainder of this memo describes the rese arch conducted as well as details of the permits identified that contain 316(b)

- related requirements.



### 2 Inclusion of 316(b)

- Related Requirements in NPDES Permits We reviewed a selection of general NPDES permits, individual NPDES permits, and NPDES permitting programs to cha racterize the current effort to include 316(b) requirements in permits.

2.1 General Permits
We conducted a search of Stat e general NPDES permits for non

- contact cooling water using EPA’s General Permit Search for the NPDES General Permit Invent ory (U.S. EPA, 2013)

. This search returned nearly 20 potentially relevant general permits, of which we randomly selected seven for review. In this review, we fou nd one general permit that establish es requirements specifically for s ection 316(b). The Alabam a general NPDES permit for non

- contact cooling water , issued in 2011 and effective from 2012 to 2017, indicates that an initial BTA determination for a facility’s CWIS will be made during the permit renewal. The permit outlines two cases, the first where n o additional CWIS information is needed for a subsequent BTA determination and
, the second
, where t he existing BTA determination was based on limited or uncertain information. In the first case , the facility is required to: (1) submit information on the in take flow and any changes made to the operation of the CWIS since issuance of the previous permit
, and (2) provide an estimate of the flow reduction that would be achieved using a closed

- cycle recirculating system as opposed to a once

- through system. In the second case , the facility is required to submit more detailed information on the cooling water intake structure and system. In the second case, the permitting authority may find that the facility does not meet BTA under the general permit, and may t herefore have to apply for an individual NPDES permit (ADEM, 2011).
The Alabama general permit requires facilities to collect and submit information and the permitting authority to review and assess the information for a BTA determination

. These requireme nts are similar to those required by the final rule. EPA’s analysis of costs for the final rule did not exclude costs to the Alabama permitting authority and the regulated facilities located in Alabama for administrative activities that may already be occu rring under the general permit ; as a result
, the cost estimates in the EA likely
overstate the final rule ’s incremental cost

.
2.2 Individual Permits
EPA reviewed 16 draft and final individual NPDES permits for Electric Generators from eight states

. This

resear ch indicates that permits can be divided into three subsets:

1. Permit does not mention 316(b) and CWIS requirements (five permits)

. 2. Permit contains 316(b) requirements but does not appear to require submission of information or reevaluation of permit requirements at the time of permit renewal unless the CWIS or itsApril 21, 2014 Abt Associates | Assessment of Administrative Costs for BPJ

- Based CWA 316(b) Permitting | pg 3

operation have been modified since the last permit renewal. In addition, these permits do not appear to establish ongoin g administrative requirements for the facility (four permits)

. 3. Permit contains 316(b) requirements and requires submission of information at the time of permit renewal (regardless of whether the CWIS or its operations have been modified) and/or establishes ongoing administrative requirements (seven permits)

. The first group of permits suggests that some facilities and permitting authorities face no 316(b)

- related administrative burden in the absence of a federal regulation.
The second group of permits also appear s not to place a major administrative burden on either the facility or the permitting authority now but do es indicate that 316(b) requirements were addressed in the context of BPJ

- based permitting in the past, and could be faced again in the future

. In these cases, facilities would typically not need to submit substantial information and permitting authorities would not need to engage much in reviews and determinations of revised/new requirements for existing permits unless a facility has changed its CWIS. We summarize several examples:
 In a Missouri permit , the permitting authority simply states that the permit may be revoked and reissued to establish or modify requirements for existing CWIS and that until a new 316(b) rule is promulgated, the facili ty must continue operating its CWIS as previously indicated and approved ( MDNR, 2012 )

.  A permit for a facility in Tennessee similarly states that the 316(b) limits for the facility are consistent with BTA for minimizing adverse environmental impact but that the permit may be reopened if there is a new rule or final guidance f r om U.S. EPA (TDEC, 2011).  Another Missouri permit indicates that because no modifications have occurred to the CWIS since performance of 316(b) studies in 1984 and 1986, no furthe r information or stud ies are required for the current permit renewal ( MDNR, 2010 ).  A permit for a South Carolina facility indicates that the facility was not required to perform a 316(b) study because a previous study indicated no significant threat to th e biological integrity of the source waterbody due to low water velocities (Duke Power, 2005). In most cases, the language in the se permit s suggests that if CWIS operations or the CWIS itself have not changed , th en no additional information and related permit determinations would be required at the time of permit renewal
, and that the existing permit would essentially be automatically renewed. However, if CWIS operations or the CWIS itself have been modified , the permit would be r eopened. While these permits do not indicate that a burden is necessarily placed now on facilities or permitting authorities (assuming no modification to the CWIS) , they do imply that facilities and permitting authorities faced a burden at some time in the past for developing the current permit, and that a burden could be faced in the future should any changes occur in the facilities’ CWIS. Thus, the existence of these permits indicates that facilities and permitting author ities have faced, and could face, again, a burden associated with BPJ

based permitting.
The third set of permits appear s to require submission of information from the facility and reevaluation of permit requirements regardless of whether the CWIS or its o perations have been modified and/or establish ongoing administrative requirements (i.e., monitoring and reporting) apart from requirements in conjunction with permit renewal. These permits imply a higher level of administrative burden to the facil ity and t he permitting authority.
 An Illinois permit establishes a requirement for the facility to monitor fish impingement once per week, tabulate that data, compare the data to historica l data for the same period, and then submit the information t o IEPA and Illi nois DNR. The Illinois permitting authority also requires t hat t he facility submit descriptions of the design and operation of the intake structure, modifications from original design parameters, source waterbody flow and other information, as necessary i nApril 21, 2014 Abt Associates | Assessment of Administrative Costs for BPJ

- Based CWA 316(b) Permitting | pg 4

order for the authority to evaluate potential CWIS impacts pursuant to 40 CFR 125.90(b) ( IEPA, 2008).  In another Illinois permit, final action related to CWIS operation was still under review and the permitting authority indicated that, based on a BPJ r eview, the permit might be modified to require additional information (Exelon Generation, 2012).  In the third Illinois permit reviewed , the permitting authority finds that the facility’s closed

- cycle recirculating system, a cooling pond, qualifies as BTA for preventing impingement mortality in accordance with BPJ provisions. However, the permitting authority still requires that the facility submit information on the CWIS design and operation, source waterbody flow, current and historical impingement/entrai nment data, and any CWIS modifications, structural or operational
, in order to facilitate a BPJ review ( IEPA, 2013 ).  The permit for a facility located in South Dakota requires the facility to submit and comply with a best management practices (BMP) plan to minimize adverse environmental impact, including reduction of impingement and entrainment (SD E NR, 2014).  Consistent language across three Texas permits imply that there is a systematic requirement for facilities to submit documentation of CWIS

- related information for a BTA determination and that each facility is required to adhere to the conditions set forth in that documentation . In addition
, the permit includes language to leav e open the possibility that the permit be reopened if it is later decided t hat the CWIS configuration is not BTA for minimizing adverse environmental impact (TCEQ, 2011a; TCEQ, 2011b; TCEQ, 2013 ). In the latter two of these three categories, EPA found that Permit Directors are including, and will continu e to include
, impingement and/or entrainment requirements in the NPDES permitting process in the absence of a national 316(b) regulation , and consequently will incur an administrative cost and also impose an administrative burden on regulated facilities. Therefore, the administrati ve costs assigned by EPA for the final rule and other options EPA considered are very likely an overestimate.

2.3 NPDES Permitting Programs
In addition to the review of S tate permits, EPA also reviewed 316(b)

- related policy and permitting programs for authori ties known to have a more systematic, structured approach for establishing 316(b) requirements in the NPDES permitting process: Region 1 NPDES permitting in New Hampshire and Massachusetts
, and New York Department of Environmental Conservation (NYDEC) Stat e Pollutant Discharge Elimination System (SPDES) permitting

. For Massachusetts and New Hampshire (which do
not have delegated authority under the CWA for administering NPDES permits) , EPA Region 1 has undertaken thorough reviews of a facility’s existing pl ant cooling water system (CWS) and potential CWS modifications at the time of permit renewal. These reviews generally involve both 316(b) permit specifications (for the cooling water intake system) and thermal discharge specifications (discharge of “hot” w ater as a pollutant subject to technology

- based discharge limits) . In some instances, facilities have been asked to prepare and submit detailed impingement and entrainment studies, and engineerin g assessments of alternative CW S technology, including cost e stimates, to support BPJ

- based permit determinations. Although not tied strictly to CWIS as opposed to the overall CWS, including consideration of thermal discharge
, these efforts can require a substantial commitment of resources, which may exceed the administrative b urden that will occur under the final rule. Similarly to Region 1, NY DEC has also established stringent CWIS requirements with a S tate

- level regulation that re quires a closed

- cycle recirculating system (CCRS) for facilities with a design intake flow (DIF) of 20 mgd or more (NYDEC, 2011). However, apart from requiring CCRS, NYDEC has also established requirements , such as impingement

- related technology, for some facilities

. F or instance, NYDEC is requiring Port Jefferson Station to install variable speed pumps, a modified Ristroph

- type screen, and a low stress fish return system by December 2014 . Likewise, the NYDEC specifiedApril 21, 2014 Abt Associates | Assessment of Administrative Costs for BPJ

- Based CWA 316(b) Permitting | pg 5

technology requirements for the Ravens wood Generation Station along with compliance monitoring beginning in 2012 and biological sampling starting in 2013/2014 (NYDEC , 2014 )

. In summary, for New York facilities, Permit Directors are establishing site

- specific CWIS requirements in addition to th e S tate

level requirement of cooling towers for facilities with a DIF of 20 mgd or higher

.


### 3 References Alabama Department of Environmental Management (ADEM). 2011. National Pollutant Discharge Elimination System General Permit: Discharges of Non

- Contact Cooling Water, Cooling Tower Blowdown, and Boiler Blowdown with and without Demineralizer Wastewater. ALG250000

. Available electronically at: http://adem.alabama.gov/programs/water/permits/ALG250000NCCW.pdf

. Duke Power. 2005. Catawba Nuclear Station, Units 1 and 2. Docket Nos. 50413 and 50414. National Pollutant Discharge Eliminatio n System (NPDES) Permit No. SC0004278. Available electronically at: http://pbadupws.nrc.gov/docs/ML0518/ML051880052.pdf

. Exelon Generation. 2012. Clinton Power Station National Pollutant Discharge Elimination System (NPDES) Permit No. IL0036919 . Available electronically at: http://pbadupws.nrc.gov/docs/ML1220/ML12207A214.pdf

. Illinois Environmental Protection Agency (IEPA ). 2008. National Pollutant Discharge Elimination System (NPDES) Permit Program: Draft Reissued NPDES Permit to Discharge into Waters of the State

. NPDES Permit No. IL0005037 . Available electronically at: http://www.epa.state.il.us/public

notices/2008/exelon

- quad

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notices/2013/exelon

- lasalle/index.pdf

. New York Department of Environmental Conservation (NYDEC). 2011. CP

- #52 / Best Technology Available (BTA) for Cooling Water Intake Structures. Available electronically at: http://www.dec.ny.gov/docs/fish_marine_pdf/btapolicyfinal.pdf

. New York Department of Environmental Conservation (NYDEC). 2014. Aquatic Habitat Protection

. Web. Accessed February 28, 2014. Available electronically at: http://www.dec.ny.gov/animals/32847.html

. State of Missouri Department of Natural Resources (MDNR). 2010. Missouri State Operating Permit MO

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. State of Missouri Department of Natural Resources (MDNR). 2012. Missouri State Operating Permit MO

- 0004847 . Available electronically at: http://www.dnr.mo.gov/env/wpp/permits/issued/0004847.pdf

. State of Tennessee Department of Environment and Conservation (TDEC). 2011. Modification to NPDES Permit No. TN0005410. Availa ble electronically at: http://environment

online.state.tn.us:8080/pls/enf_reports/f?p=9034:34051:3194737682865: :NO:34051:P34051_PERMIT_N UMBER:TN0005410

. South Dakota Department of Environment and Natural Resources (SDENR). 2014. Title V Air Quality Operating Permit and Acid Rain Permit and Surface Water Discharge Permit. SD

- 0000264 . Available electronically at: http://denr.sd.gov/pdfaq1/SD

- 0000264_permit_20140206.pdf

. Texas Commission on Environmental Quality (TCEQ). 2011 a . Permit to Discharge Wastes under provisions Section 402 of the Clean Water Act and Chapter 26 of the Texas Wate r Code. TPDES Permit No. WQ0001303000 . Available electronically at:April 21, 2014 Abt Associates | Assessment of Administrative Costs for BPJ

- Based CWA 316(b) Permitting | pg 6

http://www12.tceq.state.tx.us/crpub/index.cfm?fuseaction=iwr.viewdocument&doc_name=Permit%2001 303000%2Epdf&doc_id=772414732011105&format_cd=pdf

. Texas Commission on Environmental Quality (TCEQ). 2011 b . Permit to Discharge Wastes under provis ions Section 402 of the Clean Water Act and Chapter 26 of the Texas Water Code. TPDES Permit No. WQ0001490000. Available electronically at: http://www12.tceq.state.tx.us/crpub/index.cfm?fuseaction=iwr.viewdocument&doc_name=Permit%2001 490000%2Epdf&doc_id=889514672011145&format_cd=pdf

. Texas Commission on Environmental Quality (TCEQ). 2013. Permit to Discharge Wastes under provisions Section 402 of the Clean Water Act and Chapter 26 of the Texas Water Code. TPDES Permit No. WQ0001369000 . Available electronically at: http://www12.tceq.state.tx.us/crpub/index.cfm?fuseaction=iwr.viewdocument&doc_name=Permit%2001 369000%2Epdf&doc_id=455420842013042&format_cd=pdf

. United States Enviro nmental Protection Agency (U.S. EPA). 2010. NPDES Permit Writers’ Manual. EPA

- 833

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- 001. September 2010. Available electronically at: http://cfpub.epa.gov/npdes/writermanual.cfm?p rogram_id=45

. United States Environmental Protection Agency (U.S. EPA). 2013. NPDES General Permit Inventory. Web. May 29, 2013. Accessed February 26, 2014. Available electronically at: http://cfpub.epa.gov/npdes/permitissuance/genpermits.cfm

. United States Environmental Protection Agency (U.S. EPA). 2014. Cooling Water Intake Structures

— CWA §316(b) . Web. Accessed March 3, 2014. Available electronically at: http://water.epa.gov/lawsregs/lawsguidance/cwa/316b/

.