# Wolverine Power Supply Cooperative, Inc.

RESPONSE TO COMMENTS DOCUMENT

June 29, 2011

PERMIT No. 317-07

Rick Snyder, Governor



# Air Quality Division Michigan Department of Environmental Quality

INTERNET: http://www.michigan.gov/air



## G. Vinson Hellwig, Chief Air Quality Division

Constitution Hall, 3 rd Floor 525 West Allegan Street

P.O. Box 30260 Lansing, Michigan 48909-7760 Phone: (517) 373-7023 Fax: (517) 373-1265

### Wolverine Power Supply Cooperative, Inc. Response to Comments Document Page 1 of 140 June 29, 2011

Table of Contents

Section Page

Public Participation Process ...................................................................................................

............. 3

Summary of Comments Resulting in Changes to the Permit............................................................... 4

Summary of Significant Comments................................................................................................

.... 17

A. Alternatives Analysis ......................................................................................................

.............. 17

B. MEPA/Rule 901..............................................................................................................

.............. 22

C. Public Health and Environment Concerns.................................................................................... 26

1. Comments on Environmental Justice Concerns ........................................................................... 41

D. Dispersion Modeling........................................................................................................

............. 43

E. Maximum Achievable Control Technology (MACT) Review......................................................... 53

F. Best Available Control Technology (BACT) Review ..................................................................... 71

1. IGCC .......................................................................................................................

...................... 71

2. Clean Fuels................................................................................................................

................... 72

3. Opacity....................................................................................................................

...................... 80

4. PM2.5......................................................................................................................

...................... 80

5. PM10.......................................................................................................................

...................... 82

6. NOx........................................................................................................................

....................... 84

7. SO2........................................................................................................................

....................... 87

8. CO/VOC......................................................................................................................

................... 93

9. Greenhouse Gases (GHG) .....................................................................................................

...... 95

G. Material Handling ..........................................................................................................

............. 114

H. Ancillary Equipment........................................................................................................

............ 118

I. Control Equipment ..........................................................................................................

............. 120

J. Start-up and Shut-down Emissions...........................................................................................

.. 121

K. Annual Emissions...........................................................................................................

............ 122

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L. Monitoring .................................................................................................................

.................. 125

M. Compliance Testing .........................................................................................................

.......... 128

N. Enforcement ................................................................................................................

............... 129

O. Rules and Regulations ......................................................................................................

......... 131

P. Malfunction Abatement Plan (MAP) ........................................................................................... 132

Q. Emergencies and Safety Concerns............................................................................................ 133

R. Public Participation Process...............................................................................................

........ 134

S. Miscellaneous..............................................................................................................

............... 136

T. Other Comments Received – Not Regulated by the AQD.......................................................... 140

### Wolverine Power Supply Cooperative, Inc. Response to Comments Document Page 3 of 140 June 29, 2011

I. PUBLIC PARTICIPATION PROCESS

Wolverine Power Supply Cooperative, Inc’s (Wolverine) Permit to Install application No. 317-07 is for the proposed installation and operation of a 600 megawatt (MW) (net) solid fuel-fired power plant, which will be located in the existing Carmeuse quarry (formerly Oglebay Norton) property, directly sout h of Rogers City, Michigan. The public participation process involved providing information for public review including fact sheets, technical summaries, proposed permit terms and conditions; several public comment periods, informational meetings, and public hearings were held; and the receipt of written and verbal public comments on staff’s analysis of the application and the proposed permit.

On September 23, 2008, copies of the Notice of Air Pollution Comment Period and Public Hearing, the Fact Sheet, the Technical Summary, and the draft terms and conditions were placed on the Internet at the Michigan Department of Environmental Quality (MDEQ), Air Quality Division’s (AQD) Home Page (http://www.michigan.gov/deq). Also, the AQD mailed postcards to persons who had previously expressed interest and had provided a complete mailing or email address. In addition, a notice announcing each Public Comment Period, Public Informational Meeting, and Public Hearing was placed in The Alpena News and the Presque Isle

Advance . The notice provided pertinent information regarding the proposed action; the locations of available information; a telephone number to request additional information; the date, time, and location of the Public Informational Meeting and Public Hearing; the closing date of the Public Comment Period; and the address where written comments were being received.

Since October 1, 2008, two (2) panel informational sessions and five (5) public hearings have been held regarding the Permit to Install application for the proposed project.

On May 21, 2010, the MDEQ denied the Permit to Install application, due to a failure to demonstrate need for the proposed facility. Wolverine Power challenged that decision and in the Order dated January 28, 2011, the Missaukee County Circuit Court ruled that the alleged lack of need for the proposed project alone, separate from air quality concerns, was not a legal basis to deny the application. The court remanded it back to the MDEQ for further consideration and requiring them to make a decision. This informational meeting and hearing are in response to that remand, taking into account new regulations that became effective since the denial action. These regulations are the new 1-hour National Ambient Air Quality Standards for nitrogen dioxide and sulfur dioxide and the requirement to provide a BACT demonstration for greenhouse gases.

Approximately 4500 written comments were received during the Public Comment Periods and the hearings.

The remainder of this document is a listing of the significant comments received during the public comment period and hearing regarding the proposed permit and the Department’s response. The first section discusses the comments received that resulted in changes to the final permit terms and conditions and the basis for each

### Wolverine Power Supply Cooperative, Inc. Response to Comments Document Page 4 of 140 June 29, 2011

change. The last section discusses the Department’s response to all other significant comments that did not result in changes to the final permit.

This Response to Comments document fulfills the requirements specified in

40 CFR 124.17.

II. SUMMARY OF COMMENTS RESULTING IN CHANGES TO THE PERMIT

There are a significant number of changes to the permit. Many of the changes address issues raised in the public comments. Other changes were made because of modifications to the applicable rules and regul ations or by MDEQ to clarif y enforceability of the applicable requirements. Some permit condition changes are simply corrections of unintentional errors.

Except for the first few chang es listed, the chang es listed on the follo wing pages will follow the order of conditions in the permit with in each grouping. Condition changes made in response to comments are identified, and the section of this document where a more detailed response can be located is listed for each of those changes.

Common Abbreviations / Acronyms Changes: Page 3: MDEQ added the following abbr eviations: SC = Special Condition; and PM2.5 = PM less than or equal to a nom inal 2.5 micrometers, in diameter

Page 3: MDEQ changed the following abbreviat ion: PM10 = PM less than or equal to a nominal 10 micrometers, in diameter

General Conditions Changes: Page 4: MDEQ revised General Condition No. 5 due to a 2007 rule change. General

Condition 5 now reads:

“The terms and conditions of this Permit to Install shall apply to any person or legal entity that now or hereafter owns or oper ates the process or process equipment at the location authorized by this Permit to Inst all. If the new owner or operator submits a written request to the Department pursuant to R 336.1219 and the Department approves the request, this permit will be amended to reflect the change of ownership or operational control. The request must include all of the information required by subrules (1)(a), (b), and (c) of R 336. 1219 and shall be sent to the District Supervisor, Air Quality Division, Mich igan Department of Environmental Quality. (R336.1219) ”

Special Conditions Entire Document Changes: Pages 8 - 52: MDEQ removed all footnotes in the Emission Limit tables for each emission unit and insert language, “Test protocol will s pecify averaging time”, in the appropriate cell under the Time Period/Operating Scenario column within the table.

Pages 34 - 52: MDEQ removed all footnotes in the Emission Limit tables for each emission unit and insert language, “...calculated on a dry ga s basis”, in the appropriate cell under the

Limit column within the table.

### Wolverine Power Supply Cooperative, Inc. Response to Comments Document Page 5 of 140 June 29, 2011

Pages 8 - 52: MDEQ added PM 2.5 BACT limits. Emission limits were added for PM2.5 to

all emission units which have PM10 limits.

Pages 1 – 53: MDEQ change applicable requi rement of R 336.1299(e) to R 336.1299(2)(b). There was an error throughout the entire doc ument referencing the applicable requirement for adoption of standards by reference for federal MACT requirements.

Pages 1 – 53: MDEQ added the following app licable requirements to each emission units requirement for a Malfunction Abatem ent Plan (MAP): R 336.1331, R 336.1910, R 336.1911, R 336.2803, R 336. 2804, R 336.2810, 40 CFR 52. 21 (c), (d), & (j)

EUAUXBOILER Condition Change : Page 8: (Emission Limit Column for SC I.2, 1.3, and 1.6) MDEQ changed “lb/hr” to “pph”, to keep consistency throughout t he document. Both units refer to the same meaning of pounds per hour.

Condition Change : Page 8: (SC I.8) MDEQ defined HCl as “Hydroge n Chloride” in the Emission Limit Table,

Pollutant column.

Comment:

Particulate matter limits for EUAUXBOILER doe s not include condensable fraction. Draft permit does not include complete particulate matter BACT limits for EUAUXBOILER.

Response : Potential particulate matter, of all forms, from the distillate oil-fired equipment is expected to be very low, since the equipment will have lim ited use. However, PM2.5 emission limits representing BACT have been adde d to the auxiliary boiler.

Condition Change : Page 8: (Added SC I.4 and Renumbered Em ission Limit Table) MDEQ added a PM2.5 emission limit representing BACT for EUAUXBOILER.

Comment : Proposed EUAUXBOILER BACT emission limits for PM, PM10, NOx, CO, VOC and HCL exclude periods of startup and shutdown; permit does not defi ne startup and shutdown, or contain recordkeeping or reporting re quirements for startup and shutdown.

Response : MDEQ agrees with the commenter, that BACT emission limits should not be excluded during periods of startup and shutdown. Also, the MD EQ agrees with the commenter that the draft permit does not define startup and shutdown. However, MD EQ does not believe it is necessary to define startup and shutdown when there is not a way to measure continuous heat input to the boiler. When the boiler em issions were reviewed it was determined that BACT, for a small boiler (less than 100 MMBtu/h r) burning ultra low sulfur fuel and limited operation, did not include cont inuous emission monitors whic h would measure heat input. Therefore, MDEQ changed previously proposed lb/MMBtu limits to lb/hour limits based on

### Wolverine Power Supply Cooperative, Inc. Response to Comments Document Page 6 of 140 June 29, 2011

the maximum heat input of EUAUXBOILER and deleted all exclusions for startups and

shutdowns from the limits. MDEQ also added a special condi tion which minimizes emissions during startup and shutdown.

Condition Change : Page 8: (SC I.1 through I.8) MDEQ changed prev iously proposed lb/MMBtu emission limits to lb/hr limits for PM, VOC, and HCL. The lim its for the pollutants were changed as follows:

Pollutant Current Limit (lb/MMBtu) Proposed Limit (lb/hr)

PM 0.0015 0.11

VOC 0.0042 0.30

HCL 0.0007 0.050

Condition Change : Page 9: (Added SC III.4) MDEQ added a spec ial condition to the Process/Operational

Restrictions to minimize excess emissions dur ing startup and shutdown. The condition reads

as follows: “The permittee shall not operate EUAU XBOILER unless an acceptable plan that

describes how emissions will be minimiz ed during all startups and shutdowns has
been submitted to the AQD District S upervisor. The plan shall incorporate procedures recommended by the equipment manufacturer as well as incorporating standard industry practices and good combustion control. (R 336.1911, R 336.1912, R 336.2802, 40 CFR 52.21) ”

Comment : The proposed EUAUXBOILER emission limits do not contain limits for sulfur dioxide. There should also be appropriate monitoring, recordkeeping and reporting requirements.

Response : The proposed draft permit does not include emissi on limits for sulfur dioxide. However, it

does include material limits for the sulfur content in the fuel, required by the NSPS. Also, there are monitoring and recordkeeping requirem ents for fuel supplier certification records. When the auxiliary boiler emissions were review ed it was determined t hat BACT, for a small boiler (less than 100 MMBtu/hr) burning fuel oil with a low sulfur content and limited operation, was to limit only the su lfur content of the f uel since that is a limit which is more enforceable as practical manner. The fuel oil co mpany is required to do an analysis of the fuel and to certify it. This allows more fr equent monitoring and recordkeeping of the fuel

which is burned.

Condition Change : Page 9: (SC II.1) MDEQ deleted from the beginnin g of SC II.1: “After the year 2010”. That

statement refers to the sulfur content in the fuel if the boile r were to be operating before the year 2010.

Condition Change : Page 11: (Added SC IX.1) MDEQ added special c ondition to ensure the permittee follows all

federal New Source Performance Standar ds. The condition reads as follows:

### Wolverine Power Supply Cooperative, Inc. Response to Comments Document Page 7 of 140 June 29, 2011

“The permittee shall comply with all provisions of the federal Standards of Performance for New Stationary Sources as specified in 40 CFR Part 60 Subparts A and Dc, as they apply to EUAUXBOILER. (40 CFR Part 60 Subparts A & Dc)”

EUEMGGEN

Comment: The particulate matter limits for EUEMGGEN does not include condensable fraction. Draft permit does not include complete particula te matter BACT limits for EUEMGGEN.

Response : Potential particulate matter, of all forms, from the distillate oil-fired equipment is expected to be very low, since the equipment will have limit ed use. However, PM 10 and PM2.5 emission limits, which include the condens able fraction, representing BACT have been added to the emergency generator.

Condition Change : Page12: (Renumbered Emission Limits and Added SC I.2, I.3, 1.8, and 1.9) MDEQ added

PM10 and PM2.5 emission limits r epresenting BACT for EUEMGGEN.

Condition Change : Page 13: (SC II.1) MDEQ deleted refe rence to the sulfur content of diesel fuel used prior to

October 2010. The condition now reads as follows:

“The permittee shall only burn diesel f uel, in EUEMGGEN, with a maximum sulfur content of 15 ppm per ga llon, and a minimum centane in dex of 40; or a maximum

aromatic content of 35 percent by volume. (40 CFR 60.4207(b)) ”

Comment : Proposed draft conditions for EUEMGGEN do not define startup and shutdown, or contain recordkeeping or reporting requi rements for startup and shutdown.

Response : MDEQ agrees emissions should be minimized during startup and shutdown. However, MDEQ does not believe it is necessary to define startup and shutdow n when there is not a way to measure continuous heat input to the generator. Emergency generators are expected to run no more than 500 hours per year which includes startup and shutdown.

Condition Change : Page 14: (Added SC III.6) MDEQ added a specia l condition to the Process/Operational

Restrictions to minimize excess emissions dur ing startup and shutdown. The condition reads

as follows:

“The permittee shall not operate EU EMGGEN unless an acceptable plan that

describes how emissions will be minimi zed during all start ups and shutdowns has
been submitted to the AQD District S upervisor. The plan shall incorporate procedures recommended by the equipment manufacturer as well as incorporating standard industry prac tices and good combustion control. (R 336.1911, R 336.1912, R 336.2802, 40 CFR 52.21) ”

### Wolverine Power Supply Cooperative, Inc. Response to Comments Document Page 8 of 140 June 29, 2011

Condition Change : Page 15: (Added SC IX.1) MDEQ added a specia l condition to ensure the permittee follows

all federal New Source Performance St andards. The condition reads as follows:

“The permittee shall comply with all provisions of the federal Standards of Performance for New Stationary Sources as specified in 40 CFR Part 60 Subparts A and IIII, as they apply to EUEMGGEN. (40 CFR Part 60 Subparts A & IIII)”

Condition Change : Page 15: (Added SC IX.2) MDEQ added a specia l condition to ensure the permittee follows

all National Emission Standards for Hazardous Air Pollutants. The condition reads as

follows:

“The permittee shall comply with all pr ovisions of the National Emission Standards for Hazardous Air Pollutants, as specified in 40 CFR, Pa rt 63, Subpart A and Subpart ZZZZ, for Stationary Reciproc ating Internal Combustion E ngines, as they apply to

EUEMGGEN. (40 CFR, Part 63, Subparts A and ZZZZ) ”

EUFIREPUMP

Comment: The particulate matter limits for EUFIREPUMP does not incl ude condensable fraction. The draft permit does not include complete parti culate matter BACT lim its for EUFIREPUMP.

Response : Potential particulate matter, of all forms, from the distillate oil-fired equipment is expected to be very low, since the equipment will have limit ed use. However, PM 10 and PM2.5 emission limits, which include the condens able fraction, representing BACT have been added to the

emission limit table for EUFIREPUMP.

Condition Change : Page16: (Added SC l.2 and 1.3 and Renumbered Emission Limit Table) MDEQ added a PM10 and PM2.5 emission limit repr esenting BACT for EUFIREPUMP.

Condition Change : Page 16: (SC II.1) MDEQ deleted refe rence to the sulfur content of diesel fuel used prior to

October 2010. The condition now reads as follows:

“The permittee shall only burn diesel fuel, in EUFIREPUMP, with a maximum sulfur content of 15 ppm per ga llon, and a minimum centane in dex of 40; or a maximum

aromatic content of 35 percent by volume. (40 CFR 60.4207(b)) ”

Comment : The proposed draft conditions for EUFIREPU MP do not define startup and shutdown, or contain recordkeeping or reporting re quirements for startup and shutdown.

Response : MDEQ agrees emissions should be minimized during startup and shutdown. However, MDEQ does not believe it is necessary to define startup and shutdow n when there is not a

### Wolverine Power Supply Cooperative, Inc. Response to Comments Document Page 9 of 140 June 29, 2011

way to measure continuous heat input to the engine fire pump. Emergency fire pumps are expected to run no more than 500 hours per year which includes startup and shutdown.

Condition Change : Page 17: (Added SC III.6) MDEQ added a specia l condition to the Process/Operational

Restrictions to minimize excess emissions dur ing startup and shutdown. The condition reads

as follows:

“The permittee shall not operate EUFI REPUMP unless an acceptable plan that

describes how emissions will be minimiz ed during all startups and shutdowns has
been submitted to the AQD District S upervisor. The plan shall incorporate procedures recommended by the equipment manufacturer as well as incorporating standard industry practices and good combustion control. (R 336.1911, R 336.1912, R 336.2802, 40 CFR 52.21) ”

Condition Change : Page 18: (Added SC IX.1) MDEQ added special c ondition to ensure the permittee follows all

federal New Source Performance Standar ds. The condition reads as follows:

“The permittee shall comply with all provisions of the federal Standards of Performance for New Stationary Sources as specified in 40 CFR Part 60 Subparts A and IIII, as they apply to EUFIREPUMP. (40 CFR Part 60 Subparts A & IIII)”

EUBLACKSTART

Comment:

Particulate matter limits for EUBLACKSTART does not include condensabl e fraction. Draft permit does not include complete particulate matter BACT limits for EUBLACKSTART.

Response : Potential particulate matter, of all forms, from the distillate oil-fired equipment is expected to be very low, since the equipment will have limit ed use. However, PM 10 and PM2.5 emission limits, which include the condens able fraction, representing BACT have been added to the

emission limit table for EUBLACKSTART.

Condition Change : Page 19: (Added SC I.2 and I.3 and Renumbered Emission Limit Table) MDEQ added a PM10 and PM2.5 emission limits repr esenting BACT for EUBLACKSTART.

Condition Change : Page 20: (Changed SC II.1) MDEQ deleted from the beginning of SC II.1: “After the year

2010”. That statement refers to the sulfur content in the f uel if the equipment were to be operating before the year 2010.

Comment : The proposed draft conditions for EUBLACKST ART do not define startup and shutdown, or contain recordkeeping or reporting re quirements for startup and shutdown.

### Wolverine Power Supply Cooperative, Inc. Response to Comments Document Page 10 of 140 June 29, 2011

Response : MDEQ agrees emissions should be minimized during startup and shutdown. However, MDEQ does not believe it is necessary to define startup and shutdow n when there is not a way to measure continuous heat input to the bl ack start turbine. Emergency turbines are expected to run no more than 500 hours per year which includes startup and shutdown.

Condition Change : Page 20: (Added SC III.4) MDEQ added a specia l condition to the Process/Operational

Restrictions to minimize excess emissions dur ing startup and shutdown. The condition reads

as follows:

“The permittee shall not operate EUBLAC KSTART unless an acceptable plan that

describes how emissions will be minimiz ed during all startups and shutdowns has
been submitted to the AQD District S upervisor. The plan shall incorporate procedures recommended by the equipment manufacturer as well as incorporating standard industry practices and good combustion control. (R 336.1911, R 336.1912, R 336.2802, 40 CFR 52.21) ”

Condition Change : Page 22: (Added SC IX.1) MDEQ added special c ondition to ensure the permittee follows all

federal New Source Performance Standar ds. The condition reads as follows:

“The permittee shall comply with all provisions of the federal Standards of Performance for New Stationary Sources as specified in 40 CFR Part 60 Subparts A and KKKK, as they apply to EUBLACKSTART. (40 CFR Part 60 Subparts A & KKKK)”

FGCFB Emission Limits Condition Change : Page 26: (Limit Column of SC I.10 and I.16) MD EQ deleted “excluding pe riods of startup and

shutdown” from the New Source Performanc e Standard (NSPS) which should be met at all

times.

Condition Change : Page 26: (Underlying Applic able Requirement Column of SC I.18) MDEQ added R 336.1299(2)(b), to ensure the requirement fo r MACT is met during periods of startup and

shutdown for VOC.

Comment : The proposed draft conditions include conflicting limits for t he same load levels, when only the lower limit arguably may constitute BACT. Al so, a late submittal of a startup, shutdown plan violates the CAA requirements.

Response : Based on the comments received the MDEQ remo ved intermediate load conditions from the permit. The MDEQ believes that Wolverine did not provide adequate information to substantiate the necessity for such limits and that the limits appeared to allow Wolverine to operate in a malfunction state of operation without calling it a malfunction. The startup, shutdown, and malfunction plans will be submitted to the distri ct supervisor bef ore operation

### Wolverine Power Supply Cooperative, Inc. Response to Comments Document Page 11 of 140 June 29, 2011

of the plant. Since the plan is required by the permit but not par t of the permit, it allows the district supervisor to require the permittee to quickly make changes to the MAP if it fails to

address a malfunction.

Condition Change : Pages 25 -27: MDEQ removed intermediate load special conditions for NOx, CO, SO2, and VOC. As a result, all emission limits were renumbered in the Emission Limit Table.

Condition Change : Page 27: (SC I.22) MDEQ added a more restri ctive emission limit for Hydrogen Fluoride (HF), 0.00014 lb/MMBtu heat input, replaces previous proposed limit of 0.00030 lb/MMBtu heat input. This change is m ade in response to a comment. A detailed response can be

found in the “Maximum Achievable Control Te chnology (MACT) Review” Section of this

document.

Condition Change : Page 27: (SC I.25 Footnote 1) MDEQ c hanged “CEMs” to “CERMs” and added the language “as defined in 40 CFR Part 98 for non-CO2e GHGs”. Change was made for enhanced emissions monitoring. CEMs meas ures concentration of the flue gases and

CERMs measures the concentrati on plus the flow of the flue gas to monitor the emission

rate. The footnote now reads as follows:

“ 1 Emissions shall be calculated based on CO 2 CERMS data and fuel factors for nonCO2 GHGs, as defined in 40 CFR Part 98.”

FGCFB Material Limits Condition Change : Pages 27, 28: (SC II.1) MDEQ changed No. 2 fuel oil to ultra low diesel fuel based on the NSPS requirements of other dies el fueled equipment at the proposed facilit y which requires the use of this type of fuel. Ther efore, ultra low sulfur diesel fuel will be available at the site. Also, deleted previous SC II.6 since th e condition is now covered by SC II.1.

FGCFB Process/Operational Restrictions Condition Change : Page 29: (Added SC III.1) MDEQ added an additi onal requirement to t he start-up provisions

of each boiler in SC III.1 to ensure both boilers are not starting up at the same time. This qualifier is necessary to ensure protection of the NAAQS. The condition reads as follows:

“The permittee shall not operate both E UCFB1 and EUCFB2 simultaneously anytime during a start-up operation. Start-up operations for each boiler included in FGCFB shall

not exceed 24 hours. Shutdow n operations for each boiler included in FGCFB shall not

exceed 8 hours. FGCFB shall not exceed 12 cold start-ups and shutdowns for each boiler in a 12-month time period. Start-up is defined as the period of time from initiation of combustion firing until the unit reaches steady state operat ion (i.e. minimum of 50% load). Cold start-up is defined as a start-up afte r 48 or more hours following the last fuel input to the boiler. Shutdown is defined as that period of time from the initial lowering of the boiler output below 50% of the maximu m heat input, until the point at which the combustion process has stopped and the bed material fluidizing air has been

discontinued. (R 336.2810, 40 CFR 52.21(j)) ”

### Wolverine Power Supply Cooperative, Inc. Response to Comments Document Page 12 of 140 June 29, 2011

Condition Change : Page 29: (Added SC III.5) MDEQ added a specia l condition to the Process/Operational

Restrictions to minimize excess emissions dur ing startup and shutdown. The condition reads

as follows:

“The permittee shall not operate FGCFB unless an acceptable plan that describes how emissions will be minimized during all startups and shutdowns has been submitted to the AQD District Superviso r. The plan shall incorporate procedures recommended by the equipment manufactu rer as well as incorporating standard industry practices and good combustion control. (R 336.1911, R 336.1912, R 336.2802, 40 CFR 52.21) ”

FGCFB Design/Equipment Parameters Condition Change : Page 27, 28: (SC IV.1 and IV.2) MDEQ c hanged the special conditions by adding parenthesis around “spray dryer absorbe r”. The condition reads as follows:

“The permittee shall not operate EUCFB1 unl ess the selective non-catalytic reduction system (SNCR), pulse jet fabric filter with polyphenylene sulfide bags, polishing scrubber (spray dryer absorber), and sorb ent injection system is installed, maintained, and operated in a satisfacto ry manner. Satisfactory manner includes operating and maintaining each control device in accordance with an approved malfunction abatement plan (MAP) for EUCFB1 as required in Process/Operational

Restriction SC III.2. (R 336.1225, R 336.1299(2)(b ), R 336.1901, R 336.1910, R 336.2810, 40 CFR 52.21(j)) ”

FGCFB Monitoring/Recordkeeping Condition Change : Page 31: (SC VI.4) MDEQ changed the special c ondition by adding the word “volumetric” to the exhaust gas flow rate. It now reads as follows:

“The permittee shall install, calibrate, main tain and operate in a satisfactory manner a device to monitor and record the exhaust gas volumetric flow ra te from each boiler

included in FGCFB on a continuous basis. The monitor shall be operated in accordance with procedures outlined in Appendix B attached and in 40 CFR 60.49Da(m). (R 336.2810, 40 CFR 52.21(j), 40 CFR 60.49Da) ”

Condition Change : Page 30, 31: (from draft dat ed 9/9/2008, deleted SC VI.11, 12, 13, 14, and 15) MDEQ deleted previous draft recordkeeping requirement s for VOC, Pb, H2SO4, HCl and As, since it is not necessary to calcul ate monthly emissions for those pollutants. The emission limits require stack testing to verify emission rate , not to determine an annual average. Records of stack test results are required to be kept in SC VI.12.

Condition Change : Page 32: (SC VI.12) MDEQ added subparts e, f, and g to specify necessary record keeping ensuring compliance with all applicable requi rements of the permit. Also, all applicable

### Wolverine Power Supply Cooperative, Inc. Response to Comments Document Page 13 of 140 June 29, 2011

requirement numbers were added to the specia l condition. Special condition VI.12 now

reads as follows:

“The permittee shall maintain records for FGCFB for information necessary for all notifications and reports as specified in t hese special conditions as well as that information necessary to demonstrate comp liance with the emission limits of this permit. This information shall include, but shall not be limited to, the following:

a) Compliance tests and any testing required under 40 CFR Subpart Da or the conditions of this permit

b) Monitoring data

c) Heat input calculations

d) Fuel analysis including identification, type, heati ng value (Btu/lb), and the amounts of all fuels combusted in FGCFB on a daily average basis

e) Total gigawatt-hours of energy produced on a monthly basis

f) Records of the duration of all ti mes FGCFB is operated under startup or

shutdown conditions as defined in SC III.1

g) All records required by 40 CFR§60.7 and §60.52a

h) All calculations necessary to demonstra te compliance with the limits contained in this permit, or the reporting requirement s contained in Appendix C of this permit.

All of the above information shall be stored in a format acceptable to the Air Quality Division, shall be maintained for a period of at least five years, and shall be consistent with the require ments of 40 CFR 60.7(f). (R 336.1205(1)(a), R 336.1225, R 336.1228, R 336.1229(2)(b), R 336.12 99(2)(b), R 336.1301, R 336.1331, R 336.1401, R 336.1702(a), R 336.1901, R 336.1912, R 336.2802(4), R 336.2803, R 336.2804, R 336.2810, 40 CFR 52.21(a)(2 ), 40 CFR 52.21(c),(d), & (j), 40 CFR 60.42Da, 40 CFR 60.7(f)) ”

FGCFB Reporting Condition Change : Page 31: (SC VII.1) MDEQ added the underlying applicable requirement of

“ 40 CFR 60.51Da(a )” to the condition. The condition re fers to Appendix C-1 reporting which is required by 40 CFR 60.51Da(a) in addition to 40 CFR 60.51Da(b).

FGCFB Other Requirements Condition Change : Page 33: (Added SC IX.3 and changed the old SC IX.3 to SC IX.4) MDEQ added special condition to ensure the permittee follows all f ederal New Source Performance Standards.

The condition reads as follows:

“The permittee shall comply with all provisions of the federal Standards of Performance for New Stationary Sources as specified in 40 CFR Part 60 Subparts A and Da, as they apply to FGCFB. (40 CFR Part 60 Subparts A & Da) ”

### Wolverine Power Supply Cooperative, Inc. Response to Comments Document Page 14 of 140 June 29, 2011

Material Handling Operations Condition Change : Page 45, 48, and 50: (Added SC IX.1 and del eted condition from Pr ocess Operational Limits) MDEQ added special condition to ensu re the permittee follows all federal New

Source Performance Standards. The condition reads as follows:

“The permittee shall comply with all provisions of the federal Standards of Performance for New Stationary Sources as specified in 40 CFR Part 60 Subparts A and Y, as they apply to (EMISSION UNIT ID). (40 CFR Part 60 Subparts A & Y) ”

Comment: With regard to the fuel crusher (EUFUELCRU SHER) for PM and PM10, the draft conditions

reference General Condition 13 which states that Michigan ma y require performance testing for emission control. However, Subpart Y 40 CFR 60.252(c) references 40 CFR 60.8 which requires performance testing within 180 days of st art up and a written report to be submitted. The draft permit should be amended to refl ect the federal requirements found at 40 CFR 60.252(c).

Response : EUSOLIDFUELHANDLING, EUFUELCRUSHER, and EUFUELSILO are all subject to NSPS Y and the proposed permit refl ects that applicability. Ho wever the requirement for mandatory visible emission test ing under NSPS Y was not included in the draft permit. The requirement was added to the special conditions.

Condition Change : Page 45, 48, and 50: (Added SC V.1) MDEQ added the requirement for permittee to

conduct visible emissions tests for em ission units EUSOLIDFUELHANDLING, EUFUELCRUSHER, and EUFUELSILO. Special Condition reads as follows:

“Within 180 days after initial start-up of (EMISSION UNIT ID), the permittee shall conduct visible emissions tests from (EMI SSION UNIT ID) by testing at owner's expense, in accordance with federal St andards of Performance for New Stationary Sources 40 CFR Part 60 Subparts A and Y. No less than 60 days prior to testing, the permittee shall submit a complete test pl an to the AQD. The AQD must approve the final plan prior to testing. Verification of emission rates includes the submittal of a complete report of the test results to the AQD within 60 days following the last date of

the test. (40 CFR Part 60 Subparts A & Y) ”

Comment : The permit is not practica lly enforceable because it relies on a yet-to-be completed Malfunction Abatement Plan (MAP) and Fugiti ve Emissions Control Plan (FECP) and because the permit does not incl ude the contents of the MAP and FECP. The MAP violates the public participati on requirements for PSD because it w ill not be completed until after the permit is issued. The FECP violates the public participati on requirements for PSD permits because it does not have to be completed until 180 days after initial start-up of the covered equipment.

### Wolverine Power Supply Cooperative, Inc. Response to Comments Document Page 15 of 140 June 29, 2011

Response : The requirements of the MAP and the FECP are incorporated into the permit and are not separate, unenforceable provisions. For example, Specia l Condition III.2 for EULIMESTONE states that Wolverine shall not operate EU LIMESTONE unless an MAP as described in Rule 911(2) is implemented and maintained. Simila rly, Special Condition III.1 for EULIMESTONE

states the FECP shall be im plemented, and maintained.

The documents published for public comment in cluded a preliminary MAP. The preliminary MAP provides a template for the MAP requi rements and identifies the plan components, including equipment to be ins pected, inspection frequency, spare parts inventory, and

remedial actions to be undert aken if a malfunction occurs. The preliminary MAP also explains that the final in formation as to such com ponents cannot be defined until the equipment vendors are selected an d the facility design has progressed to a point that allows

definition.

The documents published for public comment also include a prelim inary FECP. As stated in that document, the requirements in the FECP may be changed once the actual equipment is selected and installed. For example, the prelimi nary FECP states that fl y ash in storage silos shall be transferred onto haul trucks using a wet ash unloading system to minimize fugitive dust. Additional requirements (including how that system will operate to keep the ash wet) will be incorporated into the FECP after the wet ash unloading system is selected and

installed.

It is not technically feasible to develop the final requirements of the MAP and the FECP as part of the pre-construction review because they are dependent on fac ility-specific, as-built site conditions. The opportunity the public was given to comment on the preliminary MAP and FECP satisfies the public partici pation requirements for PSD permits.

Condition Change : Pages 34 through 53: (SC III.1 ) As part of this comment review, MDEQ modified the previous language for requiring a fugitive dust control program from EULIMESTONE, EULIMESTONEPREP, EUBEDASH, EU FLYASH, EUSOLIDFUELHANDLING, EUFUELCRUSHER, and EUFUELSILO. The revised Special Condition III.1 now reads as follows:

“Within 180 days of initial start-up of (E MISSION UNIT ID) the permittee shall submit to the AQD District Supervisor a program fo r continuous fugitive emissions control for all material handling operations. The pr ogram shall be reviewed and approved by the AQD District Supervisor and is implemented and maintained. If at any time the fugitive dust control program fails to addr ess or inadequately addresses an event that

meets the characteristics of a revision or update, the permittee shall amend the fugitive dust control program within 45 da ys after such an event occurs. The permittee shall also amend the fugitive dust control program within 45 days, if new equipment is installed or upon request from the District Supervisor. The permittee shall submit the fugitive dust control program and any amendments to the fugitive dust control program to the AQD District Supervisor for review and approval. If the AQD does not notify the permittee within 90 days of submittal, the fugitive dust control program or amended fugitive dus t control program shall be considered approved. Until an amended plan is appr oved, the permittee shall implement corrective procedures or operational c hanges to achieve compliance with all

### Wolverine Power Supply Cooperative, Inc. Response to Comments Document Page 16 of 140 June 29, 2011

applicable emission limits. (R 336.1371, R 336.1901, R 336.2803, R 336.2804, R 336.2810, 40 CFR 52.21 (c), (d), & (j)) ”

Condition Change : Pages 34 through 53: (SC III.2) As part of the comment review, MDEQ added language requiring a malfunction abatement plan (MAP) from EULIMESTONE, EULIMESTONEPREP, EUBEDASH, EUFLYASH, EUSOLIDFUELH ANDLING, EUFUELCRUSHER, and EUFUELSILO. The Special Condi tion III.2 reads as follows:

“The permittee shall not operate (EMISSI ON UNIT) unless a malfunction abatement plan (MAP) as described in Rule 911(2) is implemented and maintained. If at any time the MAP fails to address or inadequat ely addresses an event that meets the

characteristics of a malfunc tion, the permittee shall amend the MAP within 45 days after such an event occurs. The permittee shall also amend the MAP within 45 days, if new equipment is installed or upon reques t from the District Supervisor. The permittee shall submit the M AP and any amendments to the MAP to the AQD District Supervisor for review and approval. If the AQD does not notify the permittee within 90 days of submittal, the MAP or amended MAP shall be cons idered approved. Until an amended plan is approved, the permitt ee shall implement co rrective procedures or operational changes to achieve comp liance with all applicable emission limits. (R 336.1331, R 336.1910, R 336.1911, R 336.2803, R 336.2804, R 336.2810, 40 CFR 52.21 (c), (d), & (j))”

Condition Change : Pages 34 through 53: (SC IV.1) As part of t he comment review, special conditions requiring the installation, operation and maintenance of emissions control equipment were moved from the “Process/Operational Restriction(s)” sect ion to the “Design/Equipment Parameter(s)”

section. This occurred in the fo llowing Emission Units: EULIMESTONE; EULIMESTONEPREP; EUBEDASH; EU FLYASH; EUSOLIDFUELHANDLING; EUFUELCRUSHER; and EUFUELSILO. The special condition reads as follows:

“The permittee shall not operate (specific portion of EMISSION UNIT) unless the (specific control equipment) is insta lled and/or implemented, maintained and operated in a satisfactory manner. Sa tisfactory manner includes operating and maintaining each control device in accor dance with a malfunction abatement plan (MAP), as required by Special Condition III.2. (R 336.1901, R 336.1910, R 336.1911, R 336.2803, R 336.2804, R 336.2810, 40 CFR 52.21 (c), (d) & (j))”

Condition Change : Pages 33 through 53: (SC IX.1) As part of the comment review, special conditions referencing general compliance for an applic able New Source Performance Standard (NSPS) were moved from the “Process/Operati onal Restriction(s)” se ction to the “Other Requirement(s)” section. This occurred in the following Emission Units: EULIMESTONE; EULIMESTONEPREP; EUSOLIDFUELHANDLING; EUFUELCRUSHER; and EUFUELSILO. The special condition reads as follows:

“The permittee shall comply with all provisions of the federal Standards of Performance for New Stationary Sources as specified in 40 CFR Part 60 Subparts A and (SUBPART), as they ap ply to (EMISSION UNIT). (40 CFR Part 60 Subparts A & (SUBPART)) ”

### Wolverine Power Supply Cooperative, Inc. Response to Comments Document Page 17 of 140 June 29, 2011

Condition Change : Pages 33 through 53: MDEQ made changes to the permit underlying applicable requirements (UAR). Specifically, remo val of 40 CFR 52.21(c) & (d) and MAPC Rules 336.2803, and 336.2804 from any allowabl e opacity limitations from emission units EULIMESTONE, EULIMESTON EPREP, EUBEDASH, EUFLYASH, EUSOLIDFUELHANDLING, EUFUELCRUSHER, and EUFUELSILO. This particular change was due to the recognition that opacity limits are neither subject to the PSD increment analysis nor any NAAQS demonstration.

Condition Change : Pages 46 through 52: The previously listed UAR for Opacity Limits was changed from 40 CFR 60.252(c) to 40 CFR 60.254 fo r the following emission units: EUSOLIDFUELHANDLING, EUFUELCRUSHER, and EUFUELSILO. During the comment review, the Federal EPA promulgated a revis ed NSPS Y and the appropriate UAR citation was changed.

Condition Change : Pages 34 and 37: MDEQ changed the opacity li mit from 10% to 7% for drop and transfer points in EULIMESTONE and EULIMESTONEP REP. During the comment review, the federal EPA promulgated revisions to the Standa rds of Performance for Non-metallic Mineral Processing Plants (NSPS OOO), which lowered the opacity emission limit ations for drop and transfer points from 10% to 7%.



### III. SUMMARY OF COMMENTS

A. 

### Alternative Analysis

Comment : Wolverine has not satisfied the burden of demonst rating a need for or lack of a feasible and prudent cleaner alternative to t he proposed coal plant. In very general terms, the filing fails to demonstrate there are not feasible and prudent alternatives. Issuance of the permit based on Wolverines' submittal would be arbitrary and capricious.

Response : On June 12, 2009, in response to a request fr om MDEQ, Wolverine submitted an Electric

Generation Alternatives Anal ysis ("EGAA"). The EGAA addressed both coal burning alternate technologies and non-coal burni ng alternative technologies. The MDEQ determined that, from a cost of electricity standpoint, the proposed fa cility represents the least expensive technology to implement and th e alternative technologies presented in the

EGAA are either not viable or are substantially more expensive.

In response to the question of dem onstrating need, the MDEQ orig inally denied the air permit to install on May 21, 2010. Key in that denial was a determination from the Michigan Public Service Commission (MPSC) that the applicant had failed to demonstrate a need for the additional power as part of its EGAA. Wolver ine challenged this decision and in its Opinion and Order dated January 28, 2011 in Case No. 10-7686-CE, the Missaukee County Circuit Court ruled that the alleged lack of need for the proposed fa cility alone, separate from air quality concerns, is not a legal basis to deny the permit applic ation. The court concluded

### Wolverine Power Supply Cooperative, Inc. Response to Comments Document Page 18 of 140 June 29, 2011

that the state overstepped it s authority, and gave the state 60 days to re-review the application.

Before providing a more detailed rationale regar ding the MDEQ review of the alternatives analysis, it is appropriate to provide a backg round on the requirements for performing an analysis of alternative elec tricity generating technologies.

Specific regulatory guida nce on performing an alternative anal ysis for new facilities locating in attainment areas are not provided for in exis ting federal or state environmental rules. The basis for an alternatives analysis is contained is Section 165(a )(2) of the Clean Air Act. That provision states that no major emitting fa cility on which construction is commenced after August 7, 1977, may be construc ted in an attainment area unless, among other things:

...the proposed permit has been subject to a review in accordance with this section, the required analys is has been conducted in a ccordance with regulations promulgated by the Administrator, and a public hearing has been held with the opportunity for interested persons including representatives of t he Administrator to appear and submit written or oral present ation on the air quality impact of such

source, alternatives thereto , control technology re quirements, and other appropriate consideratio ns; [Emphasis added]

This provision has been interpreted by the United States Environm ental Protection Agency (EPA) Environmental Appeals Board to require a permitting agency to respond to comments raised during public comment r egarding alternatives to a pro posed facility, and to give the agency the discretion as to how to conduct this review.

Language similar to that in Section 165(a)(2) is contained in Rule 1817(2)(e) of the Michigan Air Pollution Rules. The rule requires the MD EQ to do several things after receiving a technically complete permit application, including:

Provide opportunity for a public hearing fo r interested persons to appear and submit

written or oral comments on the air quality impact of the major source, alternatives

to it , the control technology required, and other appropriate considerations. [Emphasis added]

As previously stated, on J une 2, 2009, the MDEQ requested that Wolverine provide an analysis of alternatives in response to public comment received on the draft air permit to install. The EGAA was submitted by Wo lverine addressing comments received on alternatives to the proposed facility.

In cooperation with the MPSC, the EGAA was re viewed with regard to alternatives. Although, the MPSC conc luded that ‘the coal-fir ed generating plant is one alternative out of a range of alternatives t hat may be used to fill the pr ojected capacity need’, costs

associated with the alternatives were re viewed and deemed prohibitive. The MPSC suggested that alternat ives such as energy efficiency and renewable resources may be

used.

The EGAA evaluated a number of different altern ative technologies. In very general terms these alternatives can be grouped into two categories: coal burning technologies and noncoal burning alternative technologies. For c oal burning technologies a number of coal burning technologies were evaluated and co sts of implementing the technologies were

### Wolverine Power Supply Cooperative, Inc. Response to Comments Document Page 19 of 140 June 29, 2011

estimated in the EGAA. The coal burning technologies considered included Advanced Supercritical Pulverized Coal, Subcritical Pulv erized Coal, Subcritical Circulating Fluidized Bed, Integrated Gasification combined Cycle and Ultra Supercritical Pulverized Coal. The non-coal burning technologies considered incl uded natural gas combined cycle, natural gas combustion turbine, on-shore wind, off-shore wi nd, small wind, small biomass – wood, solar photovoltaic, hydroelectric, nuclear , geothermal, and landfill gas.

The MDEQ reviewed the assumptions and methodol ogy used by Wolverine in arriving at the costs of the various technologies. The MDEQ det ermined the costs of the alternatives to the proposed facility are s ubstantially more expensive than t he proposed facility itself and are cost prohibitive. In addition, some of the te chnologies are not available (e.g. geothermal) or have limited availability (e.g. comb ined heat and power, pumped storage).

Comment : Even looking just at coal-fir ed generation, there are feasible and prudent alternatives available for achieving lower environmental im pacts than the proposed c oal plants, such as

IGCC.

Response : Coal-burning technologies other than CFB boilers are available, as discussed in a previous response. MDEQ evaluated thes e technologies during the permit review process, including IGCC. Other existing coal co mbustion technologies are not de signed to burn the multiple fuels that Wolverine is proposing to use. Wolver ine, as a part of thei r alternatives analysis,

evaluated the cost of these alternate coal fi ring alternatives and m ade the determination that the chosen technology is t he most cost effective for the vari ety of fuels they are proposing to
use. MDEQ concurred wi th this determination.

In regards to IGCC, the applicant provided additional information as a part of the best available control technology (BACT) review. The MDEQ rejected IGCC from further analysis as it was determined to be cost prohibitive under this control technology review. The MDEQ has similarly rejected IGCC as cost prohibiti ve for purpose of the analysis under Section 165(a)(2) of the Clean Air Act and Rule 1817(2)(e) of Michigan's Air Pollution Control Rules.

Comment : The public has not been provided the full oppo rtunity for meaningful public participation required by the Clean Air Act and state regul ations. The public has not been given the opportunity to review the alternatives analys is and needs analysis provided by Wolverine.

Response :

Neither Section 165(a)(2) of the Clean Air Act nor Rule 187(2)(e) of Michigan's Air Pollution Control Rules require additional public comment . Nevertheless, the MDEQ, in order to provide the public with all pertinent issues re lating to the evaluation of the permit, announced a 30-day public comment period. This comment period was announced on the MDEQ website (see http://www.deq.state.mi .us/aps/cwerp.shtml ). This public comment period was scheduled concurrently with the public hearing announced by the MPSC public comment period. All information related to the EGAA wa s made publicly available during this public notice period either on the MDEQ webs ite or via the MPSC e-docket.

### Wolverine Power Supply Cooperative, Inc. Response to Comments Document Page 20 of 140 June 29, 2011

Comment : The EGAA fails to recognize that it is possibl e to construct nothing a nd still meet Michigan’s foreseeable generation requirements.

Response : This comment is directed at the issue of whet her there is a need for the facility. In its Opinion and Order dated January 28, 2011 in Case No. 10-7686-CE, the Missaukee County Circuit Court ruled that the alleged lack of need for the proposed facilit y alone, separate from air quality concerns, is not a legal basis to deny the permit application.

Comment : Wolverine assumed an estimated cost for wind pow er that is at least 1.5 times higher than national averages and recent estimates.

Response : Many of the factors that are us ed to estimate the costs of el ectrical generation are volatile

and in a constant state of flux. Wolverine es timated the cost of power generated by a wind

farm would be about 11.1 cents/kWh 1 . Since a wind farm alone is not suitable for baseload need, this cost includes a natural gas simple-c ycle technology for thos e intermittent times that the wind is not blowing. Assuming that the assertion made by the commenter is correct, if the cost for wind power was adjusted downw ards, the national average cost for wind power would equate to approximately 7. 4 cents/kWh, which is the sa me cost of the chosen CFB boiler technology firing petroleum coke/PRB/Biomass Blend. 2 Also, consideration would need to be given to the amount of land required for a wind farm. For every 1 MW of power

there needs to be at least 50 ac res of land available. Ther efore, to achieve a 600 MW capacity there would need to be at l east 50 square miles of land available.



### Comment: Section 165(a)(2) of the Clean Air Act, which requires as part of the permitting for a proposed major source that the public be provided the opportunity to submit testimony on the “air quality impacts of such source, alternatives thereto, control technology requirements, and other appropriate considerations.” As the agency is required to respond to comments submitted by the public, MDEQ must substantively address the alternatives issues raised in these and other public comments. In addition, this language has long been interpreted to grant a permitting authority broad discretion to evaluate need, consider alternatives (including the “no build” alternative), conduct or require additional analyses, and impose permit condi tions beyond the baseline requirements of BACT in order to protect air quality. In re Prairie State Generating Co. , PSD Appeal No. 05-05, quoting U.S. EPA Draft NSR Manual, 1990 (“NSR Manual”), MDEQ may consider a no-build option under Section 165(a)(2) of the Act, which provides MDEQ with the authority to deny a PSD permit based on policy considerations related to CO2.17 While Section 165(a)(2) is designed primarily to ensure that the public’s participation rights are

1 See “Wolverine Power Cooperative Electric Generation Al ternatives Analysis for the proposed Permit to Install (PTI) No. 317-07 For Circulating Fluidized Bed Coal Bo ilers at Rogers City, Michigan, Docket Number: U16000, Staff Report to the Michigan Department of Environmental Quality, Page 36.

2 See “Wolverine Power Cooperative Electric Generation Al ternatives Analysis for the proposed Permit to Install (PTI) No. 317-07 For Circulating Fluidized Bed Coal Bo ilers at Rogers City, Michigan, Docket Number: U16000, Staff Report to the Michigan Department of Environmental Quality, Page 39.

### Wolverine Power Supply Cooperative, Inc. Response to Comments Document Page 21 of 140 June 29, 2011

meaningful, MDEQ is not limited to issues rais ed by the public, but instead may consider or require alternatives, evaluations of need, and additional permit conditions on its own.

Response: As previously stated, discretion is granted to the reviewing authority as to how to respond to comments raised on alternatives. This position is supported in the Prairie State case cited by the commenter. The MDEQ requested Wolverine address the question of alternatives raised during pub lic comment and Wolverine responded with

submittal of the EGAA. Wolverine, as a part of their al ternatives analysis, evaluated the cost of coal firing alternatives and made the determination that the chosen technology is the most cost effective for the variety of fuels they are proposing to use. MDEQ concurred with

this determination. As to the question of need or a ‘no build’ option, in its Opinion and Order dated January 28, 2011 in Case No. 10-7686-CE , the Missaukee County Circuit Court ruled that the alleged lack of need for the proposed facility alone, separate from air quality concerns, is not a l egal basis to deny t he permit application.

Comment : We are sorry to see MDEQ misapplying the 28 th Circuit Court ruling of Jan. 28. That ruling turns entirely on a failure by the MDNRE PTI deni al letter to specifically tie questions about “need” to concerns about air quality – a tie that is plain in the administrative record, but not explicitly stated in the letter. In fact the rulin g concedes that if the deni al letter had taken that one final and obvious step, both it and the MD EQ decision to deny would have passed legal

muster. So the decision to exclude from thes e new hearings further c onsideration of “need” and, much more to the legal and practical point, of the ready av ailability of cleaner alternatives for meeting future base load require ments, ignores what t he circuit court ruling and federal and state laws actually say.

Response : At the time of the May 21, 2010 denial, MDEQ had determined that the proposal by Wolverine met all applicable air quality rules and regulations with the exception of failing to demonstrate need. Therefore, it is incorrect to say that the MD EQ is misapplying the Circuit Court ruling. In its Opinion and Order dated January 28, 2011 in Case No. 10-7686-CE, the Missaukee County Circuit Court ruled that the alleged lack of need for the proposed facility alone, separate from air quality c oncerns, is not a legal basis to deny the permit application. MDEQ has evaluated the propos al and has determined that th e project meets all applicable state and federal air quality requirements.

Comment : The analysis of need is very closely tied to a requirement for alter natives analysis. That requirement for an alternative anal ysis exists both under the Feder al Clean Air Act as well as state pollution law and regulations. And that requires the state to choose a no-build scenario.

Response : 

### The MDEQ requested Wolverine address the question of alternatives raised during public comment and Wolverine responded with submittal of the EGAA. Wolverine, as a part of their alternatives analys is, evaluated the cost of coal firing alternatives and made the

determination that the chosen tech nology is the most cost effe ctive for the variety of fuels they are proposing to use. MD EQ concurred with this determi nation. As to the question of

### Wolverine Power Supply Cooperative, Inc. Response to Comments Document Page 22 of 140 June 29, 2011

need or a ‘no build’ option, in its Opinion and Order dated January 28, 2011 in Case No. 10-7686-CE, the Missaukee County Circuit Court ruled that the alleged lack of need for the proposed facility alone, s eparate from air quality concerns, is not a legal basis to deny the permit application.

B. 

### MEPA/Rule 901

Comment : The emission of carbon dioxide (CO 2 ) and other greenhouse gases (GHGs) from the proposed facility will pollute, im pair and destroy natural resour ces by exacerbating climate change. The impacts on public health and the environment from climate change are severe and widespread. Section 1705(a )(2) of MEPA requires that the MDEQ deny the permit application if there is a feasib le and prudent alternative that would avoid or minimize the effect on climate change fr om the proposed facility.

Response : The focus of the Michigan Environmental Pr otection Act (MEPA) is on the conduct of the permit applicant as opposed to em issions from other facilities. 3 Section 1705(2) of MEPA

states:

In administrative, licensing, or other proceedings, and in any judicial review of such a proceeding, the alleged pollution, impairment, or destruction of the air, water or other natural resources, or the public trust in these resources, shall be determined, and

conduct shall not be authorized or approved that has or is likely to have such an effect if there is a feasible and prudent alternative consistent with the r easonable requirements of the public health, safety, and welfare. [MCL 324.1705(2)].

Before reaching the question of whether there is a feasible and prudent alternative to a permit applicant's conduct under Section 1705(2) of MEPA, the MDEQ is to determine

whether the conduct has or is lik ely to have the effect of pollu ting, impairing, or destroying
natural resources. If the MDEQ concludes the conduct has or is likely to have that effect, the

conduct shall not be authori zed if there is a feasible and pru dent alternative consistent with the reasonable requirements of the public health, safety, and welfare. If, however, the MDEQ determines the applicant's conduct does not have or is not lik ely to have that effect, it is unnecessary to analyze whether a feas ible and prudent alternative exists.

Not all environmental impacts from human activi ties pollute, impair, or destroy natural resources. As the Michigan Supreme Court has observed, "virtually a ll human activities can be found to adversely impact natural resources in some way or other. The real question before us is when does such impact rise to the level of impai rment or destruction?" 4
Whether the emissions from a facility rise to t he level of pollution, impairment, or destruction

of natural resources is determined based on the particular facts of the facility's operations and its impacts. The factors to examine incl ude whether the natural resources involved are rare, unique, or endangered and whether t he natural resources impacted are easily replaceable. 5

3 See Preserve the Dunes, Inc v MDEQ, 471 Mich 508, 514; 684 NW2d 847 (2004).

4 West Michigan Envt'l Action Council v Natural Resources Comm'n, 405 Mich 741, 760; 275 NW2d 538 (1979).

5 Nemeth v Abonmarche Development Inc, 457 Mich 16, 31-36; 574 NW2d 641 (1998).

### Wolverine Power Supply Cooperative, Inc. Response to Comments Document Page 23 of 140 June 29, 2011

Climate change is caused by changes in atmospheric conc entrations of GHGs and aerosols, as well as changes in land cover and solar radi ation. Global emissions of GHGs from human activities have increased since pre-industrial times, with an increase of 70% from 1970 to

2004. 6

According to the Intergovernment al Panel on Climate Change, CO 2 is the most important anthropogenic GHG. Annual emissions of CO 2 from global anthropogenic activities increased by approximatel y 80% between 1970 and 2004. 7 Once GHGs (including CO 2 ) are emitted from anthropogenic ac tivities anywhere around the world, they become well mixed globally in the atmosphere and remain in the atmosphere for decades to centuries. 8

GHG emissions from the proposed facility will not rise to the le vel of pollution, impairment or

destruction under MEPA. The ava ilable information indicates t hat the current and future

adverse effects of climate change (such as more frequent he at waves, increased drought, sea level rise, and more intense storms) ar e very likely caused by GHG emissions from anthropogenic activities globally over the course of past decades and centuries. 9 Adverse effects that are projected to occur in the futu re will not be caused by the GHGs emitted from the proposed facility. Sinc e the incremental contribution to climate change from GHGs emitted by the facility does not hav e and is not likely to have th e effect of polluting, impairing or destroying natural resources, no analysis of alternatives under MEPA is required.

Two commenters submitted a Petition to Interv ene pursuant to Section 1705(1) of MEPA. Like the comments they submitted on the draft per mit, they allege that GHGs from the facility

will exacerbate climate c hange and that the MDEQ mu st deny the permit under Section 1705(a)(2). This response addresses the comments on the draft permit and the

Petition to Intervene.

Comment : MEPA requires the MDEQ to adopt more stringent pollution standards t han those required by

the CAA and Part 55 if Wolverines’ actions have or are likely to have the effect of polluting, impairing, or destroying natural resources. Air pollutant emi ssions from the proposed facility -- even if they complied with the CAA and Part 55 -- will adversely impact public health, air quality, water quality and vegetation.

In addition, the facility will result in negativ e impacts from coal mining and associated transportation, water withdrawals, water di scharges, and waste dispos al. These impacts constitute pollution, impairment, or destruc tion of natural resources under MEPA.

Response : The permit requirements developed pursuant to the CAA and Part 55, Air Pollution Control,

of the Natural Resources and Environmental Protection Act, 1994 PA 451, as amended (NREPA), to address air emissions are protecti ve of public health and the environment. Air emissions from the facility do not constitute pollution, impairm ent, or destruction of natural

resources under MEPA.

6 Intergovernmental Panel on Climate Change, Clim ate Change: 2007, Synthesis Report, Summary for Policy Makers, at 5 (Nov. 17, 2007).

7 See id.

8 74 Fed Reg 18,886, 18,888 (April 24, 2009).

9 See IPCC Synthesis Report, at 5; 74 Fed Reg at 18,888.

### Wolverine Power Supply Cooperative, Inc. Response to Comments Document Page 24 of 140 June 29, 2011

Wolverine must comply with all applicabl e pollution standards regarding environmental media other than air. The commenters provide no information to show that the impacts to such other media will rise to the level of po llution, impairment, or des truction when the facility is operating pursuant to the applic able pollution standards. In addi tion, it is noted that some of the activities listed by t he commenter (e.g. coal mining and the associated transportation) take place outside of the State of Michigan. MEPA would not apply to those activities.

Comment : MEPA requires the MDEQ to thorou ghly evaluate alternatives to the facility. If a permit is issued, MEPA requires that the emission limit s not be based on the "worst case" fuels proposed by Wolverine. Instead, the em ission limits must be based on less polluting alternatives (such as natural gas, bi omass, and/or lower sulfur coals).

Response : As stated previously, Section 1705 (2) of MEPA provides that al ternatives are evaluated in licensing proceedings if it is det ermined that the proposed conduct has or is likely to have the effect of polluting, impairing, or destroying natur al resources. The facility will not have that effect. MEPA does not, therefore, require an eval uation of feasible and pr udent alternatives.

Comment : Rule 901 requires consideration of cleaner al ternatives and limits on GHG emissions.

Response : Rule 901 states:

“Notwithstanding the provisi ons of any other department rule, a person shall not cause or permit the emission of an air contaminant or wate r vapor in quantities that cause, alone or in reaction with other ai r contaminants, either of the following: (a) Injurious effects to human health or safe ty, animal life, plant life or significant economic value, or property. (b) Unreasonable interference with the co mfortable enjoyment of life and property.”

The air contaminants emitted from the proposed facility, includ ing GHG, will not have either

of the effects identified in Rule 901. Wolv erine is required to comply with the permit requirements developed pursuant to Part 55 and the CAA to ensure protection of public

health and the environment. GHG emissions have been addressed under the BACT review and appropriate limits have been added to the per mits. Additional information can be found

under the BACT Section of this document.

Comment : Section 165(a)(2) of the CAA, 42 USC 7475(a )(2), requires a thorough evaluation of the need for, and cleaner alternatives to, the proposed facility. T hat evaluation must consider environmental impacts from the facility, energy need, alternatives in addition to a no-build option, and measures to avoid or minimize environmental impacts (i ncluding impacts from GHG emissions). In addition, Section 165(a)(2) provides authorit y to the MDEQ to deny a permit application

based on the relative environmen tal impacts of the proposed fa cility and cleaner alternatives and to impose permit conditions beyond those required to satisfy BACT.

### Wolverine Power Supply Cooperative, Inc. Response to Comments Document Page 25 of 140 June 29, 2011

The available information demonstr ates that the prop osed facility is not needed. Whatever need exists can be met through the use of cleaner alternatives.

Response : Section 165(a)(2) states that no major emitting facility may be c onstructed in an area that is in attainment with the NAAQS unless a public hearing has been held on the proposed permit and an opportunity provided for interested persons to submit presentat ions on the air quality impact of the source and "a lternatives thereto."

The MDEQ has analyzed alternat ives to the propos ed facility pursuant to Section 165(a)(2), including less polluting alternatives. Alternativ es to the facility are addressed elsewhere in

this document.

Comment : Section 165(a)(4) of the CAA, 42 USC 7475(a)(2), requires the consideration of collateral environmental impacts as part of step 4 of a BACT analysis.

Response : The MDEQ analyzed collateral environmental im pacts as part of its BACT analysis.

Comment : The proposed facility will emit si gnificant amounts of hazardous ai r pollutants. An evaluation

of cleaner alternatives is therefor e required under MEPA and Rule 901.

Response : The permit restricts the emission of hazardous air pollutants pursuant to the requirements of Michigan's air toxics rules and the CAA to ensure they are protective of public health and the

environment. The emissions that Wolverine is authorized to emit do not rise to the level of pollution, impairment or destructi on of natural resources under M EPA, nor do they result in

the effects listed in Rule 901.

Comment: PM2.5 NAAQS is inadequate to protect public health and the environment. MEPA and Rule 901 require emissions limits beyond thos e needed to meet the PM2.5 NAAQS.

Response: A PM2.5 NAAQS modeling analysis was performed taking into account all emissions at the proposed facility; along with ot her sources in the area expect ed to contribute to the NAAQS impact. Modeling demonstrated that emissions of PM2.5 comply with the NAAQS. The proposed facility’s emi ssions do not cause or contribute to exceede nce of the NAAQS for PM2.5 within the meaning of the Clean Air Act and Part 55.

This analysis demonstrates the PM2.5 emissions from the faci lity do not rise to the level of pollution, impairment, or destruction of nat ural resources under MEPA. It further

demonstrates that the PM 2.5 emissions do not result in t he effects listed in Rule 901.

### Wolverine Power Supply Cooperative, Inc. Response to Comments Document Page 26 of 140 June 29, 2011

MDEQ relies upon the NAAQS for PM2.5 as t he appropriate health protection benchmark for the assessment of the proposed fac ility. Attainment of the pr imary NAAQS is presumptively protective of the public health. On that bas is, MDEQ has concluded t hat the emissions of PM from the proposed facility will not have an adverse impact on public health.

On December 18, 2006, EPA revised the NAAQS fo r PM2.5 to levels required to protect the public health with an adequate margin of safety. On February 24, 2009, the U.S. Court of Appeals for the District of Columbia Circui t granted a petition for review and remanded to EPA for reconsideration the primary annual NAAQS and the secondary NAAQS for PM2.5. The PM2.5 NAAQS were not vacated by the cour t, and the court did not find that the primary annual NAAQS was inadequately pr otective of the public health . The court found that EPA’s failure to explain adequately why the primary ann ual level of 15 ug/m3 is sufficient to protect public health was in principle a curable defec t. EPA is currently in the process of re-evaluating the PM2.5 NAAQS, as a matter of routine updating and assessment of the

relevant studies and in res ponse to the court’s remand.

The MDEQ has not concluded that the PM2. 5 NAAQS are inadequate standards for public health protection or that Rule 901 should be appli ed to require further reductions in allowable facility impacts of PM2.5. T he PM2.5 emissions from the pr oposed facility do not cause the

adverse effects listed in Rule 901 and do not ri se to the level of pollution, impairment, or

destruction of natural resources under MEPA.

Comment : The emission of criteria air pollutants will pollute , impair and destroy natural resources. More specifically, negative im pacts to human health from the emi ssion of criteria pollutants may
occur at levels below the NAAQS established by EPA as shown by t he Senate Report that accompanied the 1977 amendments to the CAA. MEPA and Rule 901 therefore require an

evaluation of cleaner alternatives.

Response : The commenter mistakenly interpreted the Se nate Report. The Senate Report emphasizes that the NAAQS are insufficient to protect public health and welfare and explains that Congress added the PSD program to the CAA in 1977 to achieve air quality better than the NAAQS. The permit for the pr oposed facility ensures that Wolv erines' operations will meet the requirements of both the NAAQS and the PSD program. Further, in 1977 the Senate Report did not address PM2.5 emissions.



### C. Public Health and Environment Concerns

Comment: The Fact Sheet for the draft permit states: “Only a fraction of the mercury emitted may deposit locally. The remainder undergoes long- range transport where it disperses and may still deposit, but at lesser levels of impact than o ccurs locally.” The statement shows an error in the assumptions MDEQ used to evaluate t he risks from mercury em itted by the proposed facility. Recent studies (e.g., the Steubenville, Ohio study by K eeler et al.) have shown that the majority of mercury deposition occurs loca lly and is from coal plants. As a result, MDEQ’s assumptions regarding local depositi on are without foundation and contradicted by

the most recent studies on the subject. MDEQ’s flawed assumptions regarding local deposition underestimate the impact the proposed facility will have on local water bodies

### Wolverine Power Supply Cooperative, Inc. Response to Comments Document Page 27 of 140 June 29, 2011

and, in turn, the health impacts to local tr ibal populations dependent upon local water bodies for subsistence fishing.



### Response: The statement the commenter quotes from th e Fact Sheet was intended to dispel any misconception that all of the em itted mercury will deposit in t he local watersheds. While wetand dry-weather deposition processes can be expected to cause some local mercury deposition (e.g., within a few kilo meters of the source), most mercury emissions will travel greater distances and disperse over larger areas.

The MDEQ did not underestimat e the risks from the facility's mercury emissions. To the contrary, the impact assessment used extremely conservative assumptions to overestimate the likely impact from the merc ury emissions and analyze whether that overstated impact did not pose an unacceptable risk to public health or the environment. One of the assumptions

concerned the extent to whic h the mercury emissions are deposited near the facility.

The local deposition impact of mercury air emissions is highly dependent on the form (speciation) of mercury. In its 1997 Mercury Study Report to Congress, EPA estimates that small, medium and large coal-fired boilers emit 50% elemental me rcury, 30% divalent mercury vapor, and 20% divalent particle-bo und mercury (“50:30:20” speciation profile). Local deposition of elemental me rcury is expected to be neglig ible; it enters the “global cycle”. Divalent mercury is ex pected to deposit in greater quant ities closer to the emission source compared to elemental mercury. Diva lent mercury vapor (also known as reactive gaseous mercury or “RGM”) is expected to deposit closer to the source than divalent particle-bound mercury. The risk assessment performed for the proposed facility used the extremely conservative assumption that the me rcury emissions consist of 100% RGM. In other words, the risk assessment used a wors t-case approach regarding the form of mercury emitted to maximize the calculation rega rding local deposition and ensure that such deposition was not understated. Based on the impacts using this and other conservative assumptions that overestimate the likely ri sks from the facility, the MDEQ nevertheless determined the mercury emissions from the fac ility are not anticipated to be harmful to the public health.

The assumptions in the impact assessment are not inconsistent with the findings of the Steubenville, Ohio study. That study evaluated mercury deposition at a monitoring station, rather than evaluating the dis persion and deposition pattern of mercury from any particular emission source. It does not identify the form of mercury emitted from regional coal-fired boilers or the fraction of emitted mercury from those boilers that deposited locally versus the fraction that did not. Here, the impact as sessment used a worst-case approach to local deposition due to mercury speciation by assuming that 100% of the merc ury emitted from the proposed facility is RGM.



### Comment: MDEQ only modeled deposition to four inland lakes. Deposition to Lake Huron was completely disregarded. MDEQ’s assessment ignored both the degree to which Lake Huron would be impacted by the propos ed coal plant and also the im portant role Lake Huron plays in tribal subsistence fishing. What criteria were used to evaluate the deposition radius for mercury since elemental mercur y travels thousands of miles?

### Wolverine Power Supply Cooperative, Inc. Response to Comments Document Page 28 of 140 June 29, 2011

Response: MDEQ determined it would be appropriate to conduct an assessment of the potential deposition impacts of t he mercury emissions from the propo sed Wolverine Power facility. The purpose of the mercury impa ct assessment is to characte rize the potential long-term impacts to fish mercury levels in the lakes likely to be the most impacted and that may reasonably be assumed to have fish populations that can support recreati onal sport fishing. This is an appropriate approach. The most useful risk assess ment approach is to

characterize the incremental im pacts from the facility's mercur y emissions to the fisheries that are expected to be the most affected. If the risk assessment establishes that the incremental impact at the most affected fis heries does not pose an unacceptable risk to public health from eating fish, then the incremen tal impact at lesser a ffected fisheries will similarly not pose an una cceptable risk.

Selecting the fisheries most affected by me rcury deposition from the proposed facility is guided by several key considerations. The pr oximity of the water body and watershed to the source is an important factor, since deposition rates are generally greater near the facility. The prevailing wind directions are also importan t, since varying wind dire ctions determine the

direction of movement of the me rcury in the air emissions. The size (area) of the water body and watershed is another important factor to evaluate depositi on impacts from the background concentration of merc ury in the atmosphere and from the mercury emitted by the facility. Additionally, the background fish merc ury level can be an important consideration when such data are available and show that the background fish mercury level is already approaching or exceeding a level of concern. In the case of the mercury impact assess ment for the proposed facility, the MDEQ determined that four nearby inland lakes to the east and southeast of the proposed facility could support recreational fisheries and woul d be the most impacted fisheries. The assessment estimated that the background fi sh mercury level is between 0.24 and 0.30 mg/kg at the four inland lakes (depending on the combination of assumptions used). The greatest incremental impact is 0.007 mg/kg at the most impac ted water body (Swan Lake). The cumulative mercury level in fish at the most impacted water body is less than the fish advisory trigger level of 0.5 mg/kg and less t han the value of 0.35 mg/k g the MDEQ uses to

determine if waters are in attainment with t he designated use of fish consumption under Part

31 of NREPA.

An assessment of Lake Huron would not be an appropriate focus for the study; because Lake Huron is expected have a lo wer incremental impact than the four selected lakes. Lake Huron is a very large body of water, with an area of approximately 59,600 km2 and a drainage area of approximately 134,100 km2. There is a significant background mercury atmospheric deposition loading in the region (approximately 14 to 19 ug per m2 per year, which equates to approximately 6,000 to 8,000 lb/yr to the Lake Huron watershed). If all of the facility's permitted emissions of mercury (47 lb/yr) were conservatively assumed to deposit in the Lake Huron watershed, the increm ental depositional impact would constitute only 0.6% to 0.8% of the background loading. Furthermore, the incremental impact of the facility relative to the background rate for Lake Huron is not reasonably expected to be as great as it is for the inland lakes near the source that were selected for the assessment. The potential impact of the facility' s emissions to Lake Huron and ot her fisheries not included in the assessment will be no greater than the im pact estimated for the four inland lakes

included in the assessment. Lake Huron fish me rcury levels are not currently elevated based on the MDEQ-Water Bureau designation of a ttainment status for surface waters. The commenter has not provided any information that would cause MDEQ to question the mercury impact assessment.

### Wolverine Power Supply Cooperative, Inc. Response to Comments Document Page 29 of 140 June 29, 2011

Comment: MDEQ ignored all the data on subsistence fishi ng by tribes in Michigan and considered only much lower levels of fish consumption. T he level of protection MDEQ incorporated in its modeling is not reflective of tr ibal subsistence fishing and is that of an angler who only eats one fish meal every two weeks. MDEQ t hereby violated its Rule 228 requirements.



### Response: Rules 228 and 229(b) of Michigan's Air Polluti on Control Rules authorize the MDEQ to conduct toxicological assessments using releva nt scientific information to ensure the allowable mercury emissions from a proposed fa cility are protective of human health. The
factors and variables the MDEQ uses in performing the assessments are based on the circumstances specific to t he facility being evaluated.

With regard to fish consumption rate, EPA has considered the range of fish consumption rates from survey data, including data rega rding “subsistence” fi sh consumption, and recommended using a rate of 15 g/day for t he purposes of developing chemical-specific water quality standards and pollutant disc harge limits for the Great Lakes region. 10 EPA

determined that this rate was reasonable and provided adequate protection, while acknowledging that some portion of the population w ill consume greater than 15 g/day. The consumption rate of 15 g/day is approximately the average rate for the subpopulation of regional sport anglers and their families for the consumption of regional sport-caught fish. This value also approximates the 90th percentile for the ent ire regional population.

Subsequently, the MDEQ Water Bureau promulga ted Rule 1057 under Part 31 of NREPA which incorporates a fish cons umption rate of 15 g/day fo r calculating human noncancer and cancer values to develop water quality standa rds and pollutant discharge limits. Rule 1057 also states: “Human health values may be mo dified on a site-specific basis to be more or less stringent to reflect local environmental condi tions or local human exposure.” This rule

authorizes the use of a fish c onsumption rate other than 15 g/day based on site-specific

information.

In this case, the four inland lakes evaluated in the mercury impact assessment are privately owned lakes. They have no public access. The commenter has not provided any sitespecific information showing t hat these or other nearby lakes are used for tribal subsistence fishing. MDEQ determined that, for the four in land lakes that are the most impacted fisheries and evaluated in the mercury impact assessment, 15 g/day is an appropriate fish consumption rate for purposes of evaluating the impact of mercury deposition from the proposed facility.

The risk assessment provided estimates of a 0.24 to 0.3 ppm background mercury level in fish in the lakes evaluated, and an estimate of 0.001 to 0.007 ppm incremental impact due to the facility long-term deposition impacts. Thus , the incremental impact is approximately 0.3 to 3% of the background level. This esti mate applies regardless of the assumed fish consumption 

### rate. Therefore, if a person is assum ed to consume fish at a higher (e.g., subsistence) rate, their mercury exposure would still be reas onably anticipated to be predominantly due to the background fish merc ury level, not the incremental impact.

10 Water Quality Guidance for the Great Lakes System, 40 CFR Part 132.

### Wolverine Power Supply Cooperative, Inc. Response to Comments Document Page 30 of 140 June 29, 2011

Comment: The cumulative risk assessment for the proposed facility does not meet the requirements of Rule 901, as it fails to follow guidelines recommended by EPA and the National Academies

of Science and thus underestim ates cumulative risk.



### Response:

The cumulative risk assessment the MDEQ performed to evaluate non-cancer and cancer

effects of emitted toxic air contaminants followed USEPA and MDEQ-AQD guidance. The MDEQ adopted a conservative approach in wh ich all toxic air contaminants from the proposed facility with an impact equal to or greater than one percent of the relevant health based screening level were assumed to act add itively. The MDEQ calculated the hazard quotient (HQ) for each such toxic air contami nant. The HQs for the noncarcinogenic toxic air

contaminants were then summed to calculate a total hazard index. As a conservative screening-level step, the MDEQ calculated t he total hazard index for noncarcinogens by summing the hazard quotients of al l the individual air contam inants examined regardless of whether they impact the same organ or have the same effect. 11 Based on its analysis, the MDEQ correctly determined that the cumulati ve cancer and nonc ancer risks from the proposed facility do not pose an unacc eptable risk to public health. The commenters cited two different reports by the National Academies of Science (NAS). In the first of these (“P hthalates and Cumulative Risk Assessment: The Task Ahead”), the NAS

recommended that cumulative risk assessment s hould evaluate exposures to combinations

of substances which ha ve the same toxic effects, regardless of whether or not their

mechanisms of action have been shown to be the same. MDEQ agrees with that recommendation. In the particular case of the cumulative risk assessment for the proposed facility, MDEQ took an even more conservative approach for noncancer cumulative risk assessment by combining all substances additive ly, whether they had the same toxic effects or not. The second cited NAS report (Scienc e and Decisions: Advancing Risk Assessment) provided general recommendations to EPA for wa ys to improve cumulative risk assessments in the future, while noting the complexity of considering many factors simultaneously and recognizing the need for simplified risk as sessment tools for screening-level risk
assessments. The MDEQ's cumulative risk assessment for the pro posed facility was an appropriate screening-level approach utilizing current EPA guidance.

Additional information concerning the cumu lative risk assessment is contained in the

administrative record in the Human Health Risk Assessment Scope for the Wolverine Clean Energy Venture, dated Augus t 11, 2008, and in the Addendum: Wolverine Clean Energy Venture (WCEV) Mercury Risk Assessment and Cumulative Risk Assessment, dated September 17, 2008. 12



### Comment: The draft permit will allow significant emis sions of carcinogenic toxics that pose an unacceptable cancer risk to Michigan residents.

11 The hazard quotient (HQ) for a substance is calculat ed by dividing the maximum ambient air impact by the applicable health based screening level. A hazard quotient of less than one indi cates that emissions of the toxic air contaminant are expected to be safe.

12 As discussed in the Human Health Risk Assessment, t he background level of air toxics in the area around the proposed facility is not significant. The background cumula tive HI is less than one for respiratory and neurological effects based on the background level of air toxics in Presque Isle County.

### Wolverine Power Supply Cooperative, Inc. Response to Comments Document Page 31 of 140 June 29, 2011

Response: The predicted emissions and ambi ent air impacts of all carcinogenic air toxics comply with the applicable health-based screening levels est ablished pursuant to Michigan's Air Pollution

Control Rules. There are no unacceptable cancer risks to Michigan residents associated with the proposed facility.



### Comment:

Scientific consensus exis ts that serious health impacts from PM2.5 occur at levels below the current NAAQS. The MDEQ cannot rely on co mpliance with PM2.5 NAAQS to satisfy its Rule 901 obligations, as Rule 901 applies r egardless of other regulations. Indeed, MDEQ required a Rule 901 analysis of lead, a criteria pollutant for which full PSD analysis may be required, even though t he facility did not trigger PSD for lead. Also, MEPA requires a comparison of PM2.5 impacts to health protective levels, not the 2006 NAAQS which have been remanded to EPA. The health impact anal ysis did not include the existing incidences of cardiovascular and cardiopulmonary disorders present in area residents that increase risk from particulate matter emissions.



### Response: In 2006, EPA revised the NAAQS for particulat e matter to levels required to protect the public health with an adequate margin of safety . As discussed elsewhere in this document, the ambient air near the propos ed facility is in attainment with the PM2.5 NAAQS and would

remain in attainment after c onservative (i.e., high-end) potenti al impacts of the facility are

taken into account.

In establishing the revised PM2.5 NAAQS, EPA considered ma ny comments, including those

from the Clean Air Scientific Advisory Committee (CASAC). Correspondence from CASAC to EPA (September 29, 2006) indicated agreement with the setting of the 24-hour NAAQS at a level of 35 ug/m3, but reiterated their recommendation that the annual primary PM2.5 NAAQS should be decreased from 15 ug/m3 to 13-14 ug/m 3 . The MDEQ has not concluded that the PM2.5 NAAQS are inadequate standard s for public health protection or that Rule 901 should be applied to r equire further reductions in a llowable facility impacts of PM2.5. However, the potentia l impacts of the facility plus the impacts from other sources and background levels result in a maximum am bient air annual PM2.5 level of approximately 11 ug/m 3 . That concentration is below the CASAC recommended range of 13-14 ug/m 3

. Regardless of the applicability of Rule 9 01 or MEPA to PM2.5 emissions, the PM2.5 emissions from the proposed fac ility do not cause the adverse effe cts listed in Rule 901 and do not rise to the level of pollution, impairm ent, or destruction of natural resources under

MEPA.

EPA is currently in the process of re-evaluat ing the PM NAAQS, as a matter of routine updating and assessment of the relevant studies and in respons e to the remand by the U.S. Court of Appeals for the D.C. Circuit. EPA is currently reevaluating the PM2.5 NAAQS. The
MDEQ will ensure that future proposed facilities, like the facility proposed by Wolverine Power, do not cause or contribute to an exceedence of the NAAQS.



### Comment: The facility will be a source of pollutants that cause cancer, birth def ects, and other serious health problems at low levels of exposure. It will also emit persi stent toxic pollutants that will

contaminate the en vironment and will increase health bur dens and accompanying social and

### Wolverine Power Supply Cooperative, Inc. Response to Comments Document Page 32 of 140 June 29, 2011

economic burdens. The MDEQ’s anal ysis estimates five cancer cases will be caused by the facility's operations, and t hat is too high.



### Response:

The MDEQ did not estimate that five cancer cases will be caused by the facility's operations.

In the air toxics cumulative cancer risk asse ssment, the MDEQ estimated a plausible upper

bound cumulative inhalation canc er risk of approximately five in one million for hypothetical individuals located at the point of maximum am bient air impact conti nuously for 70 years. The emissions and impacts will comply with all applicable regulations that are designed to ensure an adequate level of protection fo r the environment and public health.



### Comment: The State should undertake a full analysis of t he harm that may result from emissions from the proposed facility, including effects on the lo cal population. The potential increase in harmful effects may occur across the State and in other areas where the emissions from the facility will travel have not been described or considered by the MD EQ. The MDEQ chose not to comprehensively evaluate the impacts of the proposed plant on Lake Huron or on many other water bodies in the region. Th e proposed permitted arsenic emissions could

result in thousands of cancer cases, occurring over a period extending long into the future, based on the EPA cancer potency value and as suming there is no wa sted dose. Arsenic emissions and modeling did not take into c onsideration existing ar senic contamination (including all sources of arsenic emission), assess adsorption rates, or incorporate new

arsenic health effects information into an integrated source-receptor and exposure

assessment.



### Response: The predicted emissions and ambient air impacts of air toxics comply with Michigan's Air

Pollution Control Rules. The arsenic and othe r air toxics emissions are approvable because

the maximum modeled ambient ai r impacts do not exceed the health protective screening levels established by the MDEQ. In addition, the cumulative risk assessment and mercury impact assessment further estab lish that the emissions are no t anticipated to be harmful to public health.

The MDEQ analyzed the maximum ambient air impacts from the proposed facility and compared them to the applicable health based screening levels. The maximum modeled ambient air impacts occur relatively close to the proposed facility. At greater distances, the emissions are more dispersed, the ambient air impacts reduced, and the potential risks also meet the applicable requirements. The MDEQ's analysis demons trates that the impacts at

Lake Huron and other water bodies in the region meet the applicable screening levels. Similarly, the cumulative risk assessment and the mercury impact asse ssment show that the emissions from the proposed fa cility at all water bodies, including Lake Huron, do not pose an unacceptable risk.

With regard to arsenic, the MDEQ's analysis of carcinogenic air contaminants included an assessment of the cancer risks from inhaling arsenic emitted from the proposed facility.

Based 

### on the applicable requirements in Michigan's Ai r Pollution Control Rules, the analysis

established there is not an una cceptable inhalation risk.

In addition, arsenic has a low potential for environmental accumulation through deposition and indirect pathways of exposur e (such as children eating so il containing arsenic). EPA's

### Wolverine Power Supply Cooperative, Inc. Response to Comments Document Page 33 of 140 June 29, 2011

(1998) Utility Air Toxics Repo rt to Congress included an asse ssment of the risks from deposition and indirect exposure pathways for air toxics emissions from 426 coal-fired utilities. The agency's analysis examined local and long-range im pacts for individual facilities as well as cumulative impacts. For arseni c, EPA analyzed deposition and indirect exposure

for four model facilities and found cancer risk estimates of 4 in 10 million to 1 in 10,000 (for the pica child, i.e., a child that is assum ed to ingest significant quantities of soil). Background exposures were estimated to dominat e the exposures and risks in all scenarios. The findings of the EPA study reinforce the MDEQ 's conclusion that, due to the low risks to human health and the environment from depos ition and indirect exposure to arsenic, a separate study to analyze the risks associated wi th arsenic deposition and indirect exposure was neither required nor appropriate. The commenters did not provided any specific information to show that such a study would al ter the permit decision-making process.



### Comment: A full exposure assessment, taking into consi deration susceptible populations and important natural resources, has not been adequatel y carried out, leading to substantial

underestimation of the harm t hat would be caused. A comprehensive cumulative risk assessment of human health impacts was not performed. Examples of incomplete evaluation include mercury transport and bioa ccumulation, soil and plant contamination, carcinogen contamination of waterways, high fish consumption rates, children with asthma and other respiratory disorders, elderly resident s, cumulative neurological impacts, endocrine disruptors, and impacts to fisher ies. The addition of ANY neurot oxic heavy metal is harmful

to those women and their children with mercury levels posing health risks.



### Response: The MDEQ disagrees that the risk assessm ent was too narrowly focused. The MDEQ

utilized health-based screeni ng levels for air toxics, NAAQ S for criteria pollutants, and a multi-pathway risk assessment for mercury and lead. The MDEQ also utilized U.S.EPA guidance for the cumulative risk assessment.

The MDEQ performed a cumulative risk assessment for both carcinogenic and noncarcinogenic toxic air contaminants. The sco pe of the assessment was broad and used conservative assumptions to ensure that the cumulative risks were not underestimated. Among other things, the MDEQ used the maxi mum ambient air impac ts and calculated a total hazard index of noncarcinogenic toxic ai r contaminants regardless of whether they impact the same organ or have the same effec t. Even with these extremely conservative assumptions, the MDEQ determined that the cumu lative risks from the emission of toxic air contaminants do not pose an una cceptable risk to human health. The commenter has not provided any specific information to show th e risk assessment underestimates the harm from the proposed facility.



### Comment:

The coal ash can contai n mercury and other heavy metals, a nd all landfills leak eventually. MDEQ has not addressed these concerns adequatel y. Our health and our children’s health

is at stake.

### Wolverine Power Supply Cooperative, Inc. Response to Comments Document Page 34 of 140 June 29, 2011

Response: The regulatory review and permitting of Wolverine’ s potential disposal of coal ash in a landfill

is not within the bounds of the MDEQ’s assessment of the permit to install application for air emissions, and thus was not part of the review of this permit application.



### Comment: Minor or catastrophic system failures or hum an errors, and probabilis tic risk, should have been assessed in order to account for potentia lly increased acute and chronic health risks

and contamination of nat ural resources.



### Response: Part 55 and its rules do not require such a ssessment methods as par t of the MDEQ's air toxics analysis. The permit requires Wolveri ne to implement a ma lfunction abatement plan to prevent, detect, and correct malfunctions or equipment failures resulting in emissions exceeding any applicable emissions limit.



### Comment: Using brominated compounds to control merc ury emissions trades one carcinogen for

another. The EPA took bromine off the market because Bromo- Seltzer killed people. The State of Michigan has not answered questions as to how much bromine is going in, how much is going in the landfill and how much is going in the air.



### Response : Bromine is a naturally occurring element, present in soils at a few ppm and in seawater at approximately 65 milligrams per liter. Bromine is used in the manufacture of m any products. Although breathing high concentrati ons of bromine (e.g., 1 ppm ) can be very irritating,

bromine is less toxic than chlorine and the a cceptable occupational exposure level is 0.1 ppm (approximately 654 micrograms per cubic meter).

Bromo-Seltzer was in a class of tranquilizers called bromides, which were used as a pain reliever and sedative for heartburn, upset stomach, or acid indigestion; they were withdrawn

from the American market in 1975 due to thei r chronic toxicity. The therapeutic dose of bromide was reportedly about 3-5 grams, and repeated doses can accumulate because the body’s elimination half-life is 9-12 days. Although occasional usage may have been safe, repeated doses as low as 0.5 -1 grams per da y resulted in a risk of chronic toxic effects (neurological and gastrointestinal effects, and skin rash).

Neither bromine nor mercury are inhalatio n carcinogens. The use of activated carbon injection for mercury emission control by WC EV, which may potentially include brominated activated carbon, was considered by MDEQ and not found to pose a signi ficant concern for potential bromine emissions. The majority of the bromine would be anticipated to remain bound in the activated carbon and appear in the flyash. Any bromine that may off-gas and appear in the air emissions would be expected to have a very low ambient air impact below that which could pose a threat of i rritancy or other adverse effects.



### Comment: Presque Isle and surrounding countie s have the highest per capita c ancer rates in the State.

It seems that most deaths in t he area are caused by cancer. Information from the Detroit

### Wolverine Power Supply Cooperative, Inc. Response to Comments Document Page 35 of 140 June 29, 2011

News (detnews.com) indicate s that the 2001-2005 cancer incidence rates per 100,000 people for Presque Isle County (512.9), Al pena County (499.7) and Montmorency County (565.9) are higher than the Michigan rate of 499. 4 or the U.S. overall rate of 468.2.



### Response : Nationally, about 1 in 3 people will have cancer in thei r lifetime, therefore, cancer incidence rates appear to be high to citizens everywhere. The cancer incidence statistics provided by

the commenter indicates that the source of the data was the National Canc er Institute (NCI). The NCI website ( http://www.cancer.gov/statistics ) provides cancer inci dence statistics for each state, but not for individ ual counties. Therefore, the data presented by the Detroit News cannot be readily evaluated using the NCI website. Howeve r, the cancer statistics for each county in Michigan are available at t he Michigan Department of Community Health (MDCH) website ( www.michigan.gov/mdch ; select “Statistics and Reports”), and these data

are somewhat more recent than the NCI data cited by the Detroit News. MDEQ asked MDCH to review the data. They reported t hat the 1985 – 2007 cancer incidence rates for Presque Isle and Alpena Countie s fluctuate above and below the State rate and do not indicate higher mortality than the State rate . The Montmorency County cancer incidence rate has been higher than the State rate fair ly consistently, for reasons that are not understood but which may invo lve reporting problems.

The WCEV project emissions were evaluated for potential lifetime cumulative cancer risk. The point of maximum ambient air impact from the emissions was associated with a potential

risk level of 5 in one million over a lifetime of c ontinuous exposure. This is not considered to be an unacceptable incremental canc er risk under Part 55 of NREPA.



### Comment: What are the mercury deposition estimates fo r Swan Lake and the Swan River downstream?

Is bioaccumulation considered?



### Response: The MDEQ evaluated mercury deposition and bioaccumulation impact to the Swan Lake watershed, resulting in facility deposition impact estimates of 0.22 grams per year to the lake and 9.06 grams per year to the watershed. The modelin g also utilized an estimated background (not due to the fac ility) deposition rate of 6.53 gr ams per year to the lake and 591.79 grams per year to the watershed.



### Comment: Has the shifting wind direction from onshore to offshore been accounted for in the fallout pattern?



### Response: The air dispersion and impact asse ssment utilized meteorological data that accounted for all conditions of wind direction, and the mercury deposition im pact assessment was based on the dispersion modeling results.



### Comment: How will calm wind conditions and calm wind prec ipitation events affect the fallout pattern from the stack plume?

### Wolverine Power Supply Cooperative, Inc. Response to Comments Document Page 36 of 140 June 29, 2011

Response: Horizontal dispersion is slowed by calm wind co nditions. Precipitation acts to strip many

contaminants out of t he air and deposit them.



### Comment: Concerning mercury deposition locally and downwind, why aren’t ranges used instead of averages?



### Response: Long-term accumulated mercury deposition impa cts are the focus of the risk assessment, because mercury is persistent and bioaccumula tive and has cumulative impacts within watersheds. Therefore, the MDEQ analyzed the impacts on water b odies and watersheds based on three years of meteorological data. It is unclear what additional useful information, if any, would be gained by utilizi ng ranges of impacts over time or spatial dimensions.



### Comment: The revised permit application dated January 10, 2008, states on page 7-4: “The MMREM results conservatively indicate t hat the mercury concentrations in fish fillets from mature fish

could increase from 0.83% to 1.25% in the tar get lakes.” That is a 50.6% increase. Also, what happened to that forecast in the Septem ber 12, 2008 revision of the Rule 228 Analysis for Mercury Emissions?



### Response: As stated in the revised permi t application, the range of es timated increases in mercury

concentration in fish fillets is the estimated incremental increase in fish fillets due to mercury emitted from the proposed fac ility alone. Contrary to th e commenters' suggestion, the percentage difference between the upper and lo wer end of that range (50.6%) does not represent the total increase in mercury concentration in fish fillets. The final revision to the risk assessment (September 12, 2008) incl uded updated meteorological data (2005-2007) and a corrected mercury emission rate. For the four lakes evaluated, the final revision

identifies an incremental incr ease of between 0.83% and 1.67% of the estimated background fish mercury level of 0.24 mg/kg.



### Comment: Michigan does not have a baseline of amounts of mercury in the environment; fish data are inadequate and much is missing. Mercury re moved from coal burning emissions is only moved to other places.



### Response: Although there are gaps in the available fish me rcury data, there is a substantial amount of environmental mercury information available that the MDEQ has compiled in several reports. For example, data on fish contaminant monito ring, including mercury, are compiled in MDEQ annual reports ( http://www.michigan.gov/deq/0, 1607,7-135-3313_3686_3728-32393-- ,00.html ), and form the basis for fish consumpti on advisories from the Michigan Department of Community Health ( http://www.michigan.gov/mdch/0 ,1607,7-132-54783_54784_54785--- ,00.html ). The MDEQ Mercury Strategy Staff Report is available at

### Wolverine Power Supply Cooperative, Inc. Response to Comments Document Page 37 of 140 June 29, 2011

http://www.michigan.gov/deq/0,1607,7-135--184041--,00.html . Since mercury is an element, it cannot be destroyed. However, c apturing and removing it from air emissions for disposal is an effective method for preventing release to the environment.



### Comment: The mercury impact assessment uses incorrect average surrogate fish values of 0.24 ppm (for Lake Esau) and 0.30 ppm (for Grand Lake). Fish mercury data exist for Swan Lake and Swan River (1986 chinook data) that indicate high er levels than those in the surrogate lakes (6/10 fish were 0.5 ppm or above). Also , the mercury assessment did not include many

other lakes in the area.

In addition, the mercury impact assessment underestimated the lo cal deposition of mercury.

The Hubbard Brook Research Foundation of Ne w Hampshire says that the average coal burning power plant has 40% reactive gaseo us mercury, while the mercury assessment
assumed 100% or 30%. DEQ assumed a dr y deposition rate equivalent to the wet deposition rate, while the Hubbard Brook Res earch Foundation states that northeastern states have dry deposition ranging from 50% to 70% in forested areas.

Further, using data from Pellston for backgro und atmospheric deposition of mercury is questionable because Pellston is in western Michigan while Rogers City is in eastern Michigan, which could affect the wet / dry patterns. It is also questionable why MDEQ suggested the use of a backgr ound deposition rate of 17.2 mi crograms per square meter on land and water, while also modeling with an assumption of a significantly higher background deposition rate on land. Some other alter native combinations of modeling assumptions could have been used but were not, which would have more appropriately been worst-case.



### Response: The MDEQ did not use incorrect surrogate fish mercury values. Staff provided to the commenter the available fish mercury data fo r Lake Huron and inland waters. Included in

that database were the 1986 Swan River Chinook salmon data (n = 10, arithmetic average = 0.447 ppm). Those fish were not resident to Sw an Lake, but were collected in the fall of the year in Swan River. More recent Chinook salmon mercury data for Lake Huron indicate average levels of about 0.1 to 0.2 ppm, alt hough the data have not been compiled for easy accessibility. The Lake Huron fish mercury data indicate attainment with all designated uses, according to MDEQ-Water Resources Division, i. e., they do not trigger nonattainment status designation under the Clean Water Act. The mercury risk assessment was appropriate and sufficient to demonstrate that the potential fac ility impacts would be acceptably low and are permissible.



### Comment: Are existing contaminants of concern and criteria pollutant s in soils in the community

considered in the assessment and how?



### Response: In the case of lead, the risk assessment us ed a multipathway approach. This included estimates of exposure due to existing (backgro und) levels of lead in topsoil, among other exposure pathways.

### Wolverine Power Supply Cooperative, Inc. Response to Comments Document Page 38 of 140 June 29, 2011

Comment: Neither the applicant nor the MDEQ has modeled how many pe ople will die, be hospitalized, require emergency room care or will become si ck because of this new facility. The modeling does not reflect the real consequen ce of issuing a permit to th is facility, which will be increased hospitalizations and decreased quality of life.



### Response: The regulatory requirements of the permitting process ensure public health protection. The requirements include meeting the National Ambient Air Quality Standards and maximum allowable increases for criteria air pollutant s, and satisfying the MDEQ air toxics rules for toxic air pollutants. These requirements ar e designed to safeguard the public health. Further, the extensive risk as sessments that have been perf ormed demonstrate that the emissions from the proposed fa cility do not pose an unacceptable risk to the public health. In addition, the commenter has not provided an y modeling to suggest that emissions from the proposed facility pose an unacceptable risk.



### Comment: This particular shoreline is known for being ho me to a number of spec ies protected by the Endangered Species Act. Any environmental impact study must determine how protected species will be impacted by an y disruption of their habitat.



### Response: There is no regulatory requireme nt for that type of assess ment. The Endangered Species Act is implemented at the federal government. In the case of Michigan’s air permit program, Michigan is operating under an approved Stat e Implementation Pl an, which does not incorporate a review under the Endangered Species Act.



### Comment:

MDEQ has not taken the economic burden and he alth burden of the people now and into the future into equal consideration.



### Response: MDEQ has accounted for public health concer ns associated with the potential future operation of the facility. Part 55 and the Clean Air Act do not require an analysis of the

economic effects of t he proposed facility.



### Comment: Pollution from coal fired power plants in Michigan has a deadly health effect on Michigan citizens. It is forecast that pollution from Mi chigan coal plants w ill be responsible for the following health impacts in the state in th e year 2010 alone: 981 deaths, 1000 hospital admissions, 1700 heart attacks, 700 cases of ch ronic bronchitis, 115 lu ng cancer deaths, 1500 emergency room visits, hundr eds of thousands of lost wo rk and school days, impacting the productivity of the stat e. Wolverine proposes to add particle pollution, SO2 and NOx pollution for the next 50 years. Allowing this additional pollution from the Wolverine plant will worsen the health threat already posed by pollu tion from coal plants and other sources in the

state.

### Wolverine Power Supply Cooperative, Inc. Response to Comments Document Page 39 of 140 June 29, 2011

Response:

The commenter describes estimates of health impacts throughout t he state that may be associated with criteria pollutant emissions fr om existing coal-fired po wer plants rather than the proposed facility. The MD EQ analyzed the public health im pacts of criteria pollutant emissions from the proposed fa cility alone and in combinati on with the existing air contaminants in the atmospher e and determined that the fa cility's emissions meet all applicable federal and state requirements, in cluding those designed to protect the public

health.

The MDEQ has confidence that the extens ive regulatory requirements of the permitting process ensure sufficient public health protec tion. These requirements include the NAAQS for criteria pollutants and the MDEQ air toxics ru les for the toxic air pollutants, both of which are designed to provide sufficient public health safeguards. The risk assessments that have been performed for the facility’s emissions do not suggest a signi ficant public health threat.



### Comment: The proposed plant’s warm water discharge and pollutants would affect water quality, fish, and aquatic species and habitats of Michigan’s waters.



### Response:

These concerns are not part of the MDEQ review of the per mit to install application for air emissions. They are addressed as part of Wo lverine’s permitting process for surface water discharge.



### Comment: Michigan’s mercury standards in fish have not been modernized. The federal EPA and FDA have set trigger levels of 0.3 ppm. Minnesota, Maine, and Canada have set levels of 0.2 ppm. Michigan trails at a much less sensitive trigger level for mercury in fish. The MDCH advisory trigger levels are only protective for sport fishermen. The new May 2007 protocol for uniform Great Lakes Sport Fish Consumption Advisory limits start at 0.058 ppm and advise no consumption at 0.95 ppm.



### Response: The mercury impact assessment cited both the MDEQ fish mercury value for determining attainment with water quality standards (0 .35 mg/kg), and the Michigan Department of Community Health consumption advisory trigger level (0.5 mg/kg). The MDEQ value of 0.35 mg/kg is current. The MDCH is in the proce ss of re-evaluating t heir fish consumption advisory trigger levels, but changes have not been made. The mercury impact assessment demonstrates that mercury level in fish fillets at the location of great est impact is below both
the MDEQ and MDCH levels. Mercury emissions from the proposed facility do not pose an unacceptable risk to public health.



### Comment: The modeling for mercury impact builds on a mat hematical base of three lakes, all with no fish mercury data. The surrogate figure from Lake Esau is 0.24 ppm. This number is not an average or median of the Lake Esau dat a. Where did it come from?

### Wolverine Power Supply Cooperative, Inc. Response to Comments Document Page 40 of 140 June 29, 2011

Response: The sample of ten smallmouth bass fr om Lake Esau in 2003 had a mean mercury concentration of 0.207 mg/kg with a 95% upper confidence limit (UCL) of 0.24 mg/kg. The 95% UCL value was used preferentially as a surr ogate value for the lakes of interest in the evaluation, rather than the mean, in order to be tter ensure that the actual levels in the lakes

of interest would not be underestimated. This step adds conservatism to the mercury incremental impact assessment for the lakes of in terest (i.e., it results in higher estimates of the potential impact of the Wolverine Power me rcury emissions than w ould be derived if the mean value were used).

Comment: The application and risk assessment material s make no mention of Naturally Occurring Radioactive Material (NORM), which could be pr esent in the coke, and could occur at levels harmful to human health, particularly fo r workers at the proposed facility.

Response: There was no evidence of any amount of radi um in the fuel sampling analysis done for petcoke.

Comment: The T-BACT analysis under Rule 224 and Rule 225’s health-based TAC screening analysis for the Draft Permit are inadequate to demonstr ate protection of public health because they rely on AP-42 emission factors and are not clear ly based on the contents of petroleum coke

that will be burned at the facility.

Response: MDEQ disagrees with the commenter. A health-based TAC analysis (R 336.1225) was performed and based on data used in AP- 42, FIRE and from the Louisiana Cleco Corporation application, in which the facilit y was permitted to burn 100% petcoke. FIRE does not contain any emission factors for bo ilers firing pet coke, therefore the Cleco emission factors, which were gr eater than the FIRE emission factors for coal, were used to be conservative in the TAC analysis. Emissi on limits were added to the permit for those TACs that did not initially meet the recommended health based screening levels. The requirement for T-BACT (R 336.1224(1)) did not apply to this project because the project was subject to 112(g) MACT review (R 336.1224(2)).

Comment:

Can Wolverine assure local citizens that the clean water and air will be kept clean during the power plants lifetime?

Response: There were no unacceptable concer ns identified during the review of the application for this project. Worst case emissions were assess ed and predicted impacts were below regulatory

threshold levels.

This permit is limited to the ac tivities at the source as t hey pertain to air emissions. Therefore, water related impacts were not evaluated in this permit application.

### Wolverine Power Supply Cooperative, Inc. Response to Comments Document Page 41 of 140 June 29, 2011

Comment: The permit conditions do not spec ify fuel quality and testing requirements. In particular,

trace metals and other hazardous chemicals in coke are highly variable, depending on what type of crude the coke came from. Thus, t he health risk analyses for mercury, lead and

other contaminants are inherentl y flawed, since they do not a ssume the full range of possible contaminants in the coke. At a minimum, co ke should be analyzed prior to shipment, to

ensure that contaminant levels are not above those assumed in the risk assessment. It is not protective of human health a nd the environment to rely on “end of pipe” metrics for these dangerous contaminants.

Response: Special condition VI.12 of FGCFB requires 

### the permittee to maintain records of fuel analysis.

1. Comments on Environmental Justice Concerns

Comment : In 2007, Governor Granholm signed Execut ive Directive No. 2007-23, “Promoting Environmental Justice” (EJ Directive). The EJ Directive calls upon the MDEQ to develop and implement an environmental justice plan for Michigan, with the goals of identifying and preventing discriminatory public health and envi ronmental effects of st ate laws, regulations, policies, and activities. Perm itting of the proposed facilit y will have disproportionately harmful impacts on tribal public health and the environment. As such, MDEQ’s permitting action under state laws and regulations shou ld have considered the differing and disproportionate impacts on tribes but it did not.

In particular, the Human Health Risk Assess ment (HHRA) did not evaluate the impacts of mercury and other emissi ons from the proposed facility on subsistence fi shers. Subsistence fishing is a reality of tribal life and prevalent in tribal communities. The MDEQ failed to consider the disproportionate impact on subsistence fishers in tribal communities. In addition to increased pollution to waters where tribal members fish, other expected impacts include increased pollution affecting plant species of importance to tribes and particulate matter impacts on air quality disproportionatel y impacting on tribe members’ health.

Response : The applicable legal requirements were applied equally to all groups. The extent and scope

of the risk assessment was consistent with t he environmental justice principle of preventing disparate adverse impacts to protected groups. The MDEQ applied a greatly expanded public outreach, education and comment process for this permit application consistent with the environmental justice pr inciple of providing opportunities for enhanced public participation.

With regard to methylmercury exposure via loca l fish consumption, c oncerns for higher rates of local fish consumption, in cluding subsistence fish ing, were also addressed in the risk

assessment because the c haracterization of the incremental im pact to fish mercury levels is applicable to any fish consumption rate. This is discussed in more detail in response to a comment regarding mercury em ission and exposure concerns.

### Wolverine Power Supply Cooperative, Inc. Response to Comments Document Page 42 of 140 June 29, 2011

Comment: Is the applicant required to conduct an Environm ental Justice analysis? Is there state or federal law requiring an Environmenta l Justice analysis by the applicant?

Response : There is no requirement for the applicant to perform an environmental justice analysis. The Air Quality Division strives to protect the health and welfare of all citizens of the State of Michigan equally. In addition, the state and federal air quality standards that have been established are designed to be pr otective for all segments of society, including the most sensitive. Therefore, the Ai r Quality Division has not attemp ted to determine the economic or racial demographics of t he area, but has determined that the permit, as approved, will meet all applicable air quality standards.

Comment:

The State’s Environmental Justice Plan that was finalized in December 2010 includes the use of the EPA’s Strategic Enforcement Adju stment Tool (EJSEAT). EJSEAT uses 18

criteria to rank census tracts on a scale of 1 to 10, with a rank ing of 1-3 indicating a relatively high priority for evaluation of environmental just ice concerns. Rogers Ci ty has a ranking of “4”, and the Rogers City area will unnecessarily be pushed over the edge into a high priority area of concern for public health if WCEV is approved and constructed.

Response : The MDEQ’s “Environmental Justice Plan” was finalized on Dec. 17, 2010 ( http://www.michigan.gov/deq/0,16 07,7-135-3306_51662---,00.html )

. The Plan presents the EPA’s EJSEAT method as a screening approach to identify “potential en vironmental justice areas of concern”. The report (p age 9) states that for projects that require public outreach, enhanced public outreac h activities will be implement ed when the proposed project is located within one mile of a level 1, 2, or 3 po tential environmental justic e area of concern as identified by EPA’s EJSEAT method. A map of Michigan showing the EJSEAT ranking of areas is provided in Attachm ent 6 of the report. The WC EV facility and the impacted area evaluated in the risk assessment are in EJSEAT prio rity areas 4 and 7. Therefore, this area is not currently located in a potential EJ area of concern, and the co mmenter did not provide any specific information to show that the WCEV facility would result in a higher ranking in the EJSEAT scoring system. Even if it could be assumed that the WCEV operation could result in an increase in the area’s EJSEAT ranking, the ranking is only a screening approach to identify potential environmental ju stice areas of concern, not for determining when and where disparate impacts exist. An EJ SEAT ranking of 1-3 would indicate a priority area for employing enhanced public outreac h activities and for providi ng assurance that adverse disparate impacts would not o ccur. Regardless of the EJSEAT ranking of the WCEV area, the MDEQ has applied heightened public outr each efforts and conduct ed an extensive risk

characterization to ensure that the facility will not have ad verse public health impacts, consistent with EJ principles.

Comment : The proposed facility w ould generate significant amounts of particulate matter, most notably PM2.5, which will impose an unwarranted and unacc eptable health burden on the tribal communities in the vicinity. Pollutants that trigger asthma attacks impose a disproportionate burden on tribal communities. According to the Centers for Disease Control, the asthma rate among Native Americans is more than 50% hig her than the rate among the rest of the

### Wolverine Power Supply Cooperative, Inc. Response to Comments Document Page 43 of 140 June 29, 2011

population. According to the study, published in Morbidity and Mortality Weekly Report, based on a 2002 survey, 11.6% of Na tive Americans said they su ffered from asthma. This was significantly higher than the national av erage of 7.5%, and much higher than every other single racial or ethnic group. The draft per mit, permit supporting materials, and application

contain no consideratio n of the differing and unequal pub lic health impact that tribal

communities would bear as a result of the particulate matter pollution from the plant.

Response : MDEQ has obtained and reviewed the study re port that was apparently described by the commenter ( http://www.cdc.gov/mmwr/prev iew/mmwrhtml/mm5307a1.htm ). MDEQ relies upon the NAAQS for PM as the appropriate heal th protection benchmark for the assessment of the proposed facility. Attain ment of the primary NAAQS is pr esumptively protective of the public health. On that basis, MDEQ has c oncluded that the emissi ons of PM from the proposed facility will not have an adverse impact on public health, including asthma prevalence among Native Americans. We are no t aware of any other specific information that the facility emissions would ag gravate asthma in the community.



### D. Dispersion Modeling

Comment : MDEQ violated the Clean Air Act by granti ng a waiver of preconstruction monitoring requirements. The Act requires that preconstruction monitoring be conducted spec ifically for the purpose of PSD permitting and does not allow monitoring dat a gathered for a different purpose to be substituted. Waiver of on-site preconstruction monitori ng is unjustified when

Wolverine has stated its intent to conduct on -site monitoring for PM10 and PM2.5. In addition, the existing, off-site monitoring data is not representative of the air quality in the area of the proposed project bas ed on monitor location, quality of the data, and currentness

of the data.

Response : Part 55, the Act and their regulations do not require the use of on-site preconstruction ambient air quality data gathered for the sole purpose of determining whether the proposed facility will exceed the NAAQS or PSD increm ents. 40 CFR part 51, appendix W provides that regional site monitors may be used to determine background concentrations near an isolated single source (s uch as the proposed facilit y) if there are no monitors located in the vicinity of the facility and addi tional requirements are satisf ied. Rule 299(2)(d) of the Michigan Air Pollution Control Rules adopts by reference the standards in 40 CFR part 51, appendix W.

The commenters seek to invalidate these prov isions in 40 CFR part 51, appendix W. A challenge to a nationally applicable regulation must be filed in the U.S. Court of Appeals for the District of Columbia, not in this per mit proceeding. The MDEQ does not have the authority to invalidate 40 CFR Part 51, appendix W.

On July 27, 2007, the MDEQ granted Wolverine's request for a waiver from on-site preconstruction monitoring and ap proved the use monitoring data for sulfur dioxide, carbon monoxide, nitrogen dioxide, PM10 and PM2.5. Wolverine proposed to perform on-site monitoring for PM10 and PM2.5 and requested the us e of regional monitoring data to provide information for PM10 and PM2.5 in case of probl ems with the onsite monitoring it elected to perform. As discussed in a separate response, Wolverine did not complete its monitoring for

### Wolverine Power Supply Cooperative, Inc. Response to Comments Document Page 44 of 140 June 29, 2011

PM10 and PM.2.5 due to technical problems and budg etary reasons. Regional site monitors may be used if, among other things, there are no monitors located in the vicinity of the source, regardless of an applicant's intent to perform on-site monitoring.

The MDEQ granted Wolverine's waiver re quest because the regional monitoring data are representative of t he ambient air quality in t he vicinity of the proposed facility. The MDEQ considered monitor location, qua lity of the data, and currentne ss of the data in granting the waiver request.

Data from regional monitor locations are suffi cient to be substituted for site-specific data when 1) the data are representative of the s ubject area (i.e., the location(s) of maximum

concentration increase from t he proposed facility, the loca tion(s) of the maximum air pollutant concentration from existing sources, and the location(s) of maximum pollutant concentration based on existing s ources and the proposed facility) , or 2) are likely more conservative than the subject area because it was collected in an area prone to higher concentrations (i.e., urban areas).

The ambient air quality monitor located in Missaukee County collected data for SO2 and CO from 2002 through 2003 and NO2 data during 2 000. This data is representative of the subject area in Rogers City because prevailing sout hwest winds transport similar regional background concentrations to Rogers City. Data for SO2 and CO collected in 2005 from a monitor located at the Seney National Wildlife Re fuge (a rural location at a near latitude and upwind of the proposed fac ility) demonstrate that t he Missaukee County data are representative of, or more conser vative than, the ambient air qu ality of the subject area.

Although only one year of monitori ng data is required, it is MD EQ’s preferred practice to review the most recent three years of data fr om the most representat ive monitor and use the

most conservative value recorded from that monitoring location as representative of the regional background. In rare cases, the most representative data may come from a monitor that has been recently decommi ssioned. If the most recent da ta from that monitor are not within the most recent 3-year window but are more likely to be repr esentative than existing

monitors from other locations , the older data may be considered for use. The factors to consider include: 1) whether any new signifi cant sources of emissions have been added since the monitor was decommissioned, and 2) whether existing monitors from other locations, during the same period, show that those monitors are less representative than the recently decommissioned monitor. Both factors are satisfied in this case. Data from Missaukee County were theref ore used in the determinati on of SO2, NO2, and CO background concentrations.

In addition, data for NO2 collected during 20 05 and 2006 from a monitor in Two Rivers, Wisconsin (also a rural, upwind location at a near latitude) confirm ed that the Missaukee County NO2 data are both current and conserva tive. The NO2 data from the Two Rivers monitor shows a lower average annual NO2 c oncentration than the Mi ssaukee County data. Data for PM10 collected from a monitor in Flint (an upwind urban location) may be substituted for site spec ific data because they are likely more conserva tive than the subject area. The data were collected in 2004, 2005, and 2006, and were therefore current when the MDEQ granted Wolverine's waiver request.

The data from the regional m onitors were collected pursuant to EPA's Ambient Monitoring Guidelines for PSD. Determination of backgr ound data for PM2.5 is disc ussed in a separate

response.

### Wolverine Power Supply Cooperative, Inc. Response to Comments Document Page 45 of 140 June 29, 2011

MDEQ disagrees that data fr om the existing monitoring net work cannot be considered as representative.

Comment : The modeling analysis uses i nappropriate meteorological data lacking the characteristics, detail and quality assurance required for moder n modeling applications. The reliance on data from the Presque Isle airs trip is unacceptable for air di spersion modeling because it is not site specific and omit s periods of calm.

Response : The MDEQ allowed the applicant to use me teorology data from the National Weather Service (NWS) collection monitor at the Presque Is le County airport. This NWS monitor site is located within one mile of the proposed facility and resides within the near-field AERMOD modeling grid. Therefore, MDEQ disagrees wi th the commenters that this data should not be considered as “on-site” data. EPA guidance allo ws an applicant to use as little as one year of on-site meteorology data for required mo deling demonstrations. However, MDEQ requested the applicant use all th ree years of available data fr om this monitoring site to increase the reliability of predicted impacts.

The commenters suggest that obs ervational data collected at NWS sites are inadequate due to instrument exposure, location, and resoluti on and, thus, should not be used for air quality modeling studies. The siting criteria for instru ment exposure, resolution, and accuracy are required to adhere to the standards outlined in the Federal Meteorological Handbook No. 1.

The observational data collected from NWS stati ons contain necessary information that is routinely used in modeling, clim ate evaluations and real time meteorological conditions for the aviation industry. The collected data are in put into complex NWS numerical forecast

models which serve as a tool for the deve lopment of daily weather forecasts and are

accurate and reliable.

The commenters state that aircraft takeoff and landings alter the reliability of the airstrip data. MDEQ disagrees as this airport is comprised of a single, seldom-used runway used by small, non-commercial aircraft. The infrequent landings , takeoffs and idling by such aircraft do not result in the data being unrepresentative of the area surrounding the proposed facility.

The commenters also state that NWS data are inadequate for air dispersion modeling purposes. Part of the commenter’s rationale stems from the fact that reported NWS hourly data at the Presque Isle airstrip are derived from 2-minute averages taken within the last 10-minutes of every hour rather than a complete hourly average. This practice provides a “snapshot” image of the atmosphe re for diagnostic forecasting and aviation purposes. 40 CFR part 51 appendix W, (the Guideline on Air Quality Models) aut horizes the use of such data from NWS reporting stations (Sec tion 8.3.1.2). Appendix W has been adopted by reference in Rule 299(2)(d) of the Michigan Air Pollution Control Rules.

The commenters also refer to the number of “calm” wind conditions contained within the NWS data as justification for invalidating modeli ng results. While it is true that when the NWS monitoring network was converted to the Automated Surface Observing System (ASOS) in the mid-1990’s, they revised the def inition of “calm” as wind speeds less than 3 knots. This policy dec ision resulted in annual data sets containing more reported calm hours than when data were manually collected. With this knowledge, EPA’s AERMOD

### Wolverine Power Supply Cooperative, Inc. Response to Comments Document Page 46 of 140 June 29, 2011

Implementation Work Group (AIWG) performed a study to determine if the increased frequency of calm winds in the ASOS data signi ficantly altered the outcome of modeled impacts. The results of this analysis were introduced during a national EPA modeler’s workshop (Denver, June 10-12, 2008). The conclu sion of the AIWG wo rkgroup was that any perceived shortcomings of t he data did not result in any unacceptable bias, and the use of standard ASOS data was acceptable for air di spersion modeling purposes. As a result, MDEQ disagrees that any additional on-sit e meteorological monitoring is required.

Comment : The Applicant and MDEQ relied on illegal and dated draft thresholds to avoid a full Class I increment analysis.

Response : Wolverine must demonstrate that emissions from the proposed facilit y will not cause or contribute to air pollution in excess of a PSD increment. Not all emissions cause or

contribute to an exceedance. In significant, i.e., de minimis, emissions are permissible. The

courts have determined that t he permitting authority has discret ionary authority under the Clean Air Act to exempt de minimis circumst ances from review when the burdens of regulation yield a gain of trivial or no value.

MDEQ has determined that emissions from t he proposed facility will not cause or contribute
to an exceedance of a PSD increment or NAAQS if they are below the Class I significant impact levels (SILs) proposed by EPA in 1996. Th e SILs are numerical va lues that represent thresholds of insignificant impac ts from the proposed facility. Sources whose contributions to

ambient concentrations in Class I areas are be low such de minimis levels do not cause or contribute to a PSD increment exceedance, do not have a signific ant impact, and are not required to perform a comprehensive PSD in crement analysis. A full Class I air quality analysis is not required when impacts are less than the applicable SILs.

Comment : A full increment analysis is likely to show vi olations of, among other things, the Class I

24-hour SO2 increment.

Response : As discussed in response to the previous comment, an impact does not cause or contribute to an increment violation if the impact is less t han the applicable SIL. Additional factors also make it exceedingly unlikely t hat proposed SO2 emissions fr om the propos ed facility will

cause an increment violation to a Class I area.

First, southeast winds would be needed to transport Wolverine emissions to Seney. Statistical wind roses from the Presque Isle County Airport show that winds from this direction are among the lowest percentage winds traveling ov er the Rogers City area.

Second, all Class I impact analyses and add endums were provided to the Federal Land Manager for review and approval. The Federa l Land Manager for th is project, Ms. Jill Webster (U.S. Fish and Wildlife Service) agreed t hat no violations are likely to occur: “A Class I modeling analysis was performed in s upport of the Prevention of Significant Deterioration (PSD) application submitted by Wolverine. Th is analysis assessed the impact to the Seney NWR due to the project. We have reviewed this mode ling analysis and the

### Wolverine Power Supply Cooperative, Inc. Response to Comments Document Page 47 of 140 June 29, 2011

PSD application. Based on the in formation provided to us, we do not believe that the project will adversely impact visibility or air quality rela ted values at Seney.” (e -mail from Jill Webster (USFWS) to William Campbell, ENSR, April 11, 2008). As such, MDEQ disagrees that a Class I increment violation is likely to occur.

Comment : The Federal Land Manager failed to fully evaluate impacts on AQRVs.

Response : The applicant is responsible for providing the appropriate Federal Land Manager with all air quality and visibility impact analyses for review and approval. Copies of the original permit application, visibility analyses , and all subsequent addendums perta ining to Class I impacts were provided to the Federal Land Manager agent, Ms. Jill Webs ter of the U.S. Fish and Wildlife Service. As discussed in the previo us comment response, Ms. Webster approved all analyses and agreed that no violations are likel y to occur: “A Class I modeling analysis was performed in support of the Prevention of Significant Deterioration (PSD) application submitted by Wolverine. Th is analysis assessed the impact to the Seney NWR due to the project. We have reviewed this modeling anal ysis and the PSD applicat ion. Based on the information provided to us, we do not believe t hat the project will adversely impact visibility or air quality related values at S eney.” (e-mail from Jill Webster (USFWS) to William Campbell, ENSR, April 11, 2008)

While MDEQ was not responsible for approving this portion of the analysis, the agency was provided with copies of the correspondenc e between the applicant and the Federal Land Manager.

Comment : Class II NAAQS and Increments – SO2, NO2, VOC, PM10; The modeling fails to take into account the impact of t he quarry’s west wall on modeled concentrations.

Response : The AERMOD modeling demonstration for all po llutants included terrain heights at all receptors. As such, the modeling did not fail to take into account the terrain heights along the quarry west wall. Additionally, the CFB boiler 450 stack height of 4 50 feet is significantly higher than the 50-80 foot high west wall of the quarry. As such, it is unlikely that the west wall would have any accumulating or channeling effect upon the buoy ant plume, even during light wind episodes. Any such effect was taken into account in the modeling by including terrain heights with each receptor.

Comment : The modeling fails to measure total impacts fr om the quarry, proposed coal plant and other sources at receptors located on quarry property owned by Oglebay-Norton.

Response : The air over secured property is considered “non -ambient” relative to that facility’s emissions and is excluded during the modeling analysis. As such, a separate run was made for “quarry only emissions” which excluded t he receptors within the quarr y’s airspace as non-ambient

### Wolverine Power Supply Cooperative, Inc. Response to Comments Document Page 48 of 140 June 29, 2011

but included all ambient receptor s outside of the quarry airspace . The impacts from quarry emissions on receptors within the quarry's secured property were therefore correctly excluded from the modeling analys is. The analysis of impacts fr om non-quarry sources (i.e., Wolverine plus non-quarry offsite sources) co rrectly considered the quarry airspace as ambient air and included receptor impacts within the quarry airspace. To determine an overall impact from all sources, the maximu m impacts from each of the runs were added together, regardless of the time and location of each run’s maximum impact. By adding the maximum impacts from multiple modeling runs, th is is approach is more protective of air quality than a single run that me rges all emissions together.

It would have been difficult, but technically possibl e, to merge the two runs into a single, combined run and then manually subtract out im pacts resulting from quarry emissions at quarry receptors. Post-processing software would have been needed to look at the each

emission source’s contribution to each receptor on a day-by-day basis. The developed software would have to identify if a receptor was located within the quarry’s airspace, and if so, subtract the quarry’s cont ribution leaving only the non-qu arry contributions. However, since adding the maximum impac ts from each run is a more conservative approach to evaluating NAAQS and PSD increment compliance than a single, combined run, the analysis is acceptable if the sum of the maximums is lower t han the applicable NAAQS and PSD

increment.

As such, MDEQ disagrees that impacts from quarry emissions within the quarry’s airspace

should have been included in the modeling analysis

Comment : MDEQ and the Applicant used inappropriately low background levels for NAAQS modeling.

Response : As discussed in response to a previous comment, the MDEQ has the authority to use regional monitors, if no other monitors ar e in the vicinity. 40 CFR part 51, appendix W (Guideline on Air Quality Models) Section 8. 2.2(c). The commenters claim the regional

monitor data should not be used bec ause the applicant initially proposed to perform its own particulate monitoring.

Prior to receiving the monitoring waiver, the applicant proposed a plan for particulate monitoring in the case the waiver request wa s denied. Once the waiver was granted, the applicant was not obliged to continue with its pr oposed monitoring. However, the applicant chose to proceed with its independent monito ring plan for PM10 and PM2.5. The applicant ran a PM10 monitor for six months, submi tted the data to the EPA and MDEQ, and did not (contrary to the commenters' suggestion) try to hide in criminating data. The PM10 monitoring program was discontinued for budget ary reasons and because results were not significantly different than the MDEQ m onitor chosen for regional background.

The PM2.5 monitor experienced a ho st of technical difficulties including a lightening strike in early July 2007 which destroyed the monitor a fter three months of operation. With the reported difficulties, questionable quality data, and short span of data, that data were never submitted to EPA. Since PM2.5 modeling was not required at the ti me, the applicant chose to discontinue PM2.5 monitoring. With the short time span of monitoring (three months for PM2.5 and six months for PM10), there was not su fficient data to qualify for background use. Additionally, since the PM10 results closely re sembled the chosen MDEQ regional monitor,

### Wolverine Power Supply Cooperative, Inc. Response to Comments Document Page 49 of 140 June 29, 2011

there was no compelling reason to override the regional monitor as representative. Additional explanation regarding t he use of regional monitoring data is provided in response to a previous comment.

Comment : The modeling inappropriately used annual av erage emissions to estimate short-term impacts, thus significantly undere stimating short-term impacts.

Response : All short-term modeling from proposed Wolver ine sources were based on the worst-case, short-term emissions scenario. For all pollutant s which had a short-term threshold, the same

short-term emission rate was also used fo r long-term impacts. Emissions reporting requirements do not include maximum single day emissions or maximum hour emissions. For those offsite sources (i.e . quarry and other non-Wolverine emission sources), the only available data reported to the State are tons per year (tpy) and hours of operation. Offsite short-term emissions are derived by dividing a nnual emissions by the total annual hours of operation.

Comment: The modeling is based on inappropriately low lb/hour figure for NOX from the black start generator that does not correspond to the dra ft permit limits on the black start generator.

Response : Although the maximum unrestricted hourly NOx emi ssion rate for the black start generator is 86.4 lbs/hour, black start generator emissions are limited by a permit cond ition that restricts operation of the generato r to 500 hours per 12-month rolling time period. The modeled NOx emission rate was “annualized” based on opera tion of the generator as restricted by the permit. The annualized NOx emission rate wa s derived per the following: 86.4 lb/hours x 500 operating hours/year / 8760 total hours/year = 4.9 lbs/hour. The modeling is therefore

based on the correct annualized lbs/hour emissions for NOx from the black start generator.

Comment: The increment analysis must include em issions during startup and shutdown.

Response : The increment and NAAQS analyses were based on the proposed pound per hour limits in the draft permit, which include emissi ons during startup and shutdown.

Comment : The increment analysis omits emissions from haul trucks at receptors on the Carmeuse property.

Response : New haul truck emissions, resulting from t he proposed facility, were included in the increment analysis.

### Wolverine Power Supply Cooperative, Inc. Response to Comments Document Page 50 of 140 June 29, 2011

Comment : The increment analysis omits mobile source co mbustion emissions from trucks and barges.

Response : By administrative rule, emissions that come di rectly from mobile s ources such as motor vehicles or vessels, are excluded from the incr ement analysis. Pursuant to Rule 1811 of the Michigan Air Pollution Control Rules, Wolver ine must demonstrate that the allowable

emission increases from the proposed facility, in conjunc tion with all other applicable emission increases or reduction, including "s econdary emissions," shall not cause or

contribute to an exceedance of the PSD in crements. Rule 1801(pp) defines secondary emissions and excludes "any emissions which come directly from a mobile source, such as emissions from the tailpipe of a motor vehicle, from a train, or from a vessel." Emissions from trucks and barges were correctly excluded from the increment analysis.

Comment : Combustion emissions from increased truck and barge traffic must be included in the air quality component of the addi tional impacts analysis.

Response : Similar to the previous comment, the comm enter wishes to expand existing broad regulations to include vehicle combustion emissi ons. The commenter us es broad definitions contained in State and Federal guidance to suggest that because ve hicle combustion emissions are not specifically excluded (other than Michigan Rule 212), inclusion is

mandated. As answered in the previous comment, emissions from trucks and barges were correctly excluded from the increment analysis.

Comment : The Permit is based impermissibly on the illegal and unsupported use of PM10 as a surrogate for PM2.5 in the m odeling demonstration.

Response : Although not required by federal or state law, Wolverine Power Supply Cooperative, Inc. has requested that the MDEQ, ra ther than use PM10 as a su rrogate for PM2.5, include an emission limit in the permit that reflects the best available c ontrol technology (BACT) for PM2.5. Wolverine submitted a “top-down” BACT a ssessment for PM2.5. It also submitted a complete air quality analysis that includes a modeling demonstration s howing that emissions from the proposed facility will not exceed th e national ambient air quality standards for PM2.5. The air quality analysis further shows t hat PM2.5 emissions w ill not exceed final
NAAQS thresholds nor the increment s for PM2.5 as proposed by EPA.

Comment : The Applicant did not conduct site-specif ic preconstruction m onitoring for PM2.5.

Response : As explained in a previous response, the applicant applied for and received a waiver from preconstruction monitoring. EPA regulations, specifically 40 CFR 51, Appendix W, Section 8.2.2(c), states that “If there are no monitors located in the vicinity of the source, a “regional site” may be used to determine background. A “regi onal site” is one that is located away from

### Wolverine Power Supply Cooperative, Inc. Response to Comments Document Page 51 of 140 June 29, 2011

the area of interest but is impacted by sim ilar natural and distant man-made sources.” Representative data are not alwa ys determined by which monito r is closest to the subject area. Although not required at the time of t he applicant’s waiver request, PM2.5 background data were included in the original supplied data inventory. That data was collected from the Alpena monitor, approximately 45 kilometers s outheast of Rogers City . When the applicant provided notice to MDEQ that they intended to go forward and perform PM2.5 modeling, a

more detailed review was conducted to determi ne the most representative PM2.5 data. It was determined that the Alpena data was likely not the most represent ative regional data because it was over five years old and from a low percentage upwind direction. Although further in distance, appr oximately 140 kilometers from t he proposed facility, the Missaukee County monitor was determined to be more repr esentative of the Ro gers City regional background because 1) the data was current; and 2) the monitor was a predominant upwind direction (southwest).

Prior to receiving the waiver, the applicant made plans to monitor for PM10 and PM2.5. Although the granted waiver ultimately negat ed the necessity for onsite particulate monitoring, the applicant still independently installed PM10 and PM2.5 monitors. As discussed in response to a prior comment, the PM10 monitor ran for six months and the data posted to the EPA network for ambient monitori ng data. The PM2.5 monitor experienced a

host of technical difficulties and was ultimately destroyed by lightening after three months of monitoring and was not continued.

As stated previously, the comment ers seek to invalidate the pr ovisions in 40 CFR Part 51, Appendix W that authorize the use of regional site monitors. The commenters' effort to challenge such nationally applicabl e regulations must be filed in the U.S. Court of Appeals for the District of Columbia, not in this permit proceeding. The MDEQ does not have the authority to invalidate these provisions.

Comment : The Applicant’s late-submitt ed PM2.5 modeling contains num erous omissions and errors that, if corrected, would result in violati ons of the PM2.5 NAAQS and increments. The Applicant failed to base the ba ckground concentrations from pr econstruction monitoring data and instead used an inappropriately low backg round concentration for PM2.5 based on non-representative regional site monitors.

Response : The Applicant voluntarily performed dispersi on modeling for PM2.5. As discussed above, the Applicant used background ambient air qualit y data from a monitor in Missaukee County

because the data are representative of ambient air quality at the pr oposed facility after taking into account monitor location, quality of th e data and currentness of the data. MDEQ has reviewed the dispersion modeling analysis for PM2.5, and it demonstrates that emissions from the proposed fac ility will not result in an exceedance of the NAAQS for PM2.5. The analysis further shows that PM 2.5 emissions will not exceed the increments for PM2.5 as proposed by EPA.

In addition, the Applicant appli ed for and lawfully received a waiver from site-specific preconstruction monitoring pursuant to 40 CFR 52.21, Appendix W.

### Wolverine Power Supply Cooperative, Inc. Response to Comments Document Page 52 of 140 June 29, 2011

Comment : The Applicant completely omitted secondary emissions.

Response : EPA currently recommends that only prim ary PM2.5 emissions be included in NSR modeling. This is because of two primary reasons: First, the current near-field models for NSR (i.e. AERMOD) are simple Gaussian di spersion models and cannot do the chemistry required for secondary emissions. The cont inental and regional models, which include chemistry, are not designed for single source applications. If pe rmitted, these sources will be included in the regional models for regional SIP analyses. Additionally, PM2.5 secondary chemistry is complex and can require hours, days , or weeks to form particulates. As such,

the reactions occur far outside the near-field grid of the available NSR models.

Comment : The Applicant used an inappropri ate radius of impact.

Response: The receptor grid for PM2.5 is the same as for the PM10 analysis. The applicant performed a “Significant Impact Analysis ” for PM10 to determine the maximum distance to a significant impact receptor. As discussed in response to a previous comm ent, a facility does not cause
or contribute to a NAAQS or increment violat ion where its emissions have an insignificant impact. It is therefore approp riate to exclude receptors outsi de the distance of the maximum significant impact receptor. Si nce primary PM2.5 is a subset of PM10, t he significant impact radius can be no greater than the radius for PM10. Second ary PM2.5 emissions are not included in the air quality analysis. The A pplicant omitted combined impacts from the Proposed Coal Plant and quarry at receptors on O-N quarry property. The air over secured property is considered “non-ambient” relative to that facility’s emissions. The impacts from quarry emissions on receptors wi thin the quarry's secured property were correctly excluded from the modeling analysis.

Comment: MDEQ’s re-analysis also fails to show protection of the NAAQS and increments.

Response : The commenters accuse MDEQ of “modeling aw ay” a predicted violation of the PM2.5 because the agency reviewed the applicant’s submitted air quality analysis and revised

calculations that overestimat ed the impacts of emissions. T he role of the agency is to

determine whether the l egal requirements for a proposed fa cility have been satisfied. In fulfilling that role and reviewing a permit applic ation, the MDEQ may appropriately revise errors in the applicant's analysis.

In the instance of preliminary modeli ng PM2.5 for 24-hour NAAQS compliance (September 30, 2008), the MDEQ modified some of the supplied input parameters to be consistent with previous PM 10 modeling and performed further analysis to evaluate the applicant's claim of compliance. The applicant was notified that the agency modified some of the supplied information and was perform ing additional analysis. MDEQ’s additional analysis involved combining the s eparate runs together, at the maximum impact receptors, to

determine if the overall maximum combined impacts achieved NAAQS compliance to the satisfaction of the agency. In the final submitted PM2.5 analysis (July 29, 2009), the

### Wolverine Power Supply Cooperative, Inc. Response to Comments Document Page 53 of 140 June 29, 2011

applicant provided the rationale for their origin al emission factors, which was accepted and used by the MDEQ for the final NAAQS and increment results.

The final 24-hour PM2.5 NAAQS impact, with 2005-2008 background, was 31.5 ug/m3, less than the threshold of 35 ug/m3. The final 24-hour PM2.5 in crement impact was 7.8 ug/m3, less than EPA’s proposed threshold of 9 ug/ m3. Annual impacts for both NAAQS and proposed increment were less than 80% of the thresholds.

Comment : The NAAQS for PM2.5 promulgated by EPA are inadequate to protec t public health, and Rule 901 requires comparison of PM2.5 modeling im pacts to levels that are truly protective.

Response : EPA set the primary NAAQS for PM2.5 to protec t the public health, including the health of sensitive populations such as, children, the elderly, and peopl e with asthma. It set the secondary PM2.5 NAAQS to protect the public we lfare, including crops, trees and buildings. MDEQ promulgated the Part 18 rules of the Ai r Pollution Control Rules to ensure that new major emitting facilities in areas that have a ttained the NAAQS do not cause or contribute to

a violation of these standards.

Unlike the NAAQS that protect t he public health and public welfare generally and take into

account emissions from diverse mobile and stationary sources, Rule 901 addresses the impact of emissions from an individual facilit y. It prohibits a person from emitting an air

contaminant that c auses injurious effects to human health or safety, animal life, plant life of significant economic value, or property; or which causes unreasonable interference with the comfortable enjoyment of life and property. It does not authorize t he establishment of ambient air quality standards to protect the pub lic health at concentra tions below the NAAQS set by EPA, nor does it authorize emi ssion limits to achieve any such standards.



### E. Maximum Achievable Control Technology (MACT) Review

Comment : The permit does not contain terms and conditi ons requiring maximum achievable control technology (MACT) for mercury and ot her hazardous air pollutants (HAPs).

Response : A case-by-case MACT analysis was performed for mercury and all other HAPs. The Public Participation Documents for Wolverine Power S upply Cooperative, Inc ., Permit Application

Number 317-07 contains a “N otice of Maximum Achievable Control Technology (MACT) Approval.” The MDEQ performed the case-by- case MACT analysis pur suant to the federal regulations that implement Section 112(g) of the Clean Air Act, 40 CFR §§ 63.40 to 63.44 and 63.50 to 63.56, that are adopted by refere nce in Rule 336.1299(2)(b) of Michigan's Air

Pollution Control Rules.

Comment : The Draft Permit purports to meet MACT re quirements for the Proposed Coal Plant’s HAPs,

but it does not. The Draft Permit is defici ent because the MACT det ermination fails to

### Wolverine Power Supply Cooperative, Inc. Response to Comments Document Page 54 of 140 June 29, 2011

establish an emission limit for each HAP the Proposed Coal Pl ant would emit, including but not limited to dioxins, radionuclides an d cyanide. These HAPs are ignored.

Response : The permit contains emission limits for each HAP that will be emitted by the emission units at the proposed facility to whic h the MACT requirements apply: the two CFB boilers and the auxiliary boiler. Dioxins are or ganic HAPs. Dioxins are incl uded in the VOC emission limit that is a surrogate for organic H APs. Radionuclides are emitted in the form of particulate

and are covered under the PM emission limit as a surrogate. Cyanides are inorganic HAPs along with HCl and HF, and are listed in the Study of Hazardous Air Pollutant Emissions from Electric Utility Steam Generating Units, Final Report to Congress. 13 HCl and HF are the surrogates for acid/inorganic HAPs which includes cyanides.

Comment : The MACT limit set in the draft permit for mercury does not meet stringent MACT standards. None of the limits are based on proper “MACT floor” analyses, nor did MDEQ undertake any beyond-the-floor investigation, as required. Once the MDEQ revises its MACT determination by performing a complete asse ssment of the Proposed Coal Plant’s likely HAPs and establishing real MACT limits for those HAPs, the MDEQ must then take a new look at the Project’s Best Av ailable Control Technology (BACT) limits since the MACT limits for the various surrogates are based on the BACT limits.

Response : MDEQ disagrees with this comment. As descri bed in the Public Participation Documents for Wolverine Power Supply Cooperative, Inc., Pe rmit Application Numb er 317-07, the MACT floors were identified and beyond-the-floor inve stigation was performed for each. The best controlled similar source(s) for all MACT lim its was identified afte r extensive research through all available sources of informati on (relevant proposed regulations, EPA - TTN RACT/BACT/LAER Clearinghouse (RBLC), permitting activities in other states, literature, etc.) and included surveying emissi on limits and test results.

Each MACT emission limit was analyzed using t he appropriate procedures to meet MACT.

The MACT emission limits are not based on a BACT analysis for the limits. In some cases,

the MACT limit which is cons idered a more stringent requirement has lowered BACT limits for those pollutants which are surrogates and PS D/criteria pollutants. This happened with hydrogen fluoride (HF) which is one of the su rrogates for acid/inorganic HAPs and volatile organic compounds (VOCs) which is the surrogat e for organic HAPs. The original proposed

BACT emission limit for HF was 0.0017 lb/MMB tu. The MACT determination resulted in lowering this limit to 0.0003 lb/MMBtu. For VOCs, the original proposed BACT emission limit

was 0.0035 lb/MMBtu and the MACT determi nation resulted in 0.0030 lb/MMBtu.

Comment : The Draft Permit does not include adequate MA CT limits for each and every hazardous air pollutant that will be emitted by the Proposed Coal Plant. The Act requires that emission

limits be established for each and every HAP that a facility will emit. The U.S. EPA has

identified 67 different HAPs that are emitted by coal-fired power plants. The draft permit fails to do so by omitting entirely several HAPs from the list of relevant HAPs, as well as

13 Study of Hazardous Air Pollutant Emissi ons from Electric Utility Steam Genera ting Units – Final Report to Congress, EPA-453/R-98-004a, February 1998, Volume 2, Table A-1.

### Wolverine Power Supply Cooperative, Inc. Response to Comments Document Page 55 of 140 June 29, 2011

inappropriately grouping HAPs together and using surrogates in place of limits on the HAPs themselves. The MACT approval, specifically lists the following HAPs scattered throughout the text: mercury; the “acid/inorganic HAPs” HCl and HF; the “metal (particulate) HAPs” antimony, arsenic, beryllium, cadmium, chro mium, lead, manganese, nickel, and selenium; and unnamed “organic HAPs.” Absent any specific list beyond these HAPs, this list serves as the only guide to the covered HAPs.

EPA’s report to Congress lists numerous additional HAPs that are not included in the WCEV MACT analysis. For example, the analysis ma kes no mention of dioxins (“priority” HAPs identified by EPA), radionuclides, or cyanide, nor include any discussi on of whether and how these pollutants are covered within the HAP categories defined or why such HAPs should be excluded, with appropriate technical support.

Response : The permit establishes emissi on limits for each HAP the propos ed facility will emit. The PM emission limit is the surrogate for metal HAPs . The VOC emission limit is the surrogate for organic HAPs, and HCl and HF are the su rrogates for acid/inorganic HAPs.

The application covers all regulated pollutants that will be emitted by the facility. A complete list is in the Public Participation Documents for Wolverine Power Supply Cooperative, Inc., Permit Application Number 317-07, Appendix 2, Table – Toxic Air Contaminant Impacts –

TAC / HAP. Table 1 below identifies the HAPs in three groupings: non-mercury metal (particulate) HAPs, acid/inorg anic HAPs, and organic HAPs.

TABLE 1

HAP HAP Grouping Mercury Mercury Hydrogen chloride Hydrogen fluoride Cyanide Acid/inorganic HAPs

Antimony

Arsenic Beryllium

Cadmium Chromium, total Chromium, hexavalent

Cobalt

Lead Manganese

Nickel Phosphorus 14

Selenium Non-mercury metal (particulate) HAPs

Acetaldehyde Acetophenone

Acrolein

Benzene Organic HAPs

14 Study of Hazardous Air Pollutant Emissions from Electric Utility Steam Generating Units – Final Report to Congress, EPA-453/R-98-004a, February 1998, Volume 2, Table A-1.

### Wolverine Power Supply Cooperative, Inc. Response to Comments Document Page 56 of 140 June 29, 2011

HAP HAP Grouping Benzyl chloride

Bromoform Methyl bromide
1,3-Butadiene

Carbon disulfide

Chlorobenzene

Chloroform

Cumene
1,4-Dichlorobenzene 15

Methylene chloride Dimethyl sulfate
2,4-Dinitrotoluene Ethylbenzene Ethyl chloride Ethylene dibromide
1,2-Dichloroethane Formaldehyde

Hexane Isophorone Methyl chloride Methyl hydrazine Methyl methacrylate Methyl tert butyl ether

Phenol Propionaldehyde Styrene Tetrachloroethylene

Toluene Vinyl acetate Xylenes alpha-Chloroacetophenone 2-Methylnaphthalene 3

5-Methyl chrysene Acenaphthene Acenaphthylene

Anthracene Benzo(a)anthracene 3

Benzo(a)pyrene Benzo(b)fluoranthene 3

Benzo(b,j,k)fluoranthene 3

Benzo(g,h,i)perylene Benzo(k)fluoranthene 3

Biphenyl Chrysene 3 Organic HAPs (cont.)

15 Study of Hazardous Air Pollutant Emissions from Electric Utility Steam Generating Units – Final Report to Congress, EPA-453/R-98-004a, February 1998, Volume 2, Table A-4.

### Wolverine Power Supply Cooperative, Inc. Response to Comments Document Page 57 of 140 June 29, 2011

HAP HAP Grouping Dibenzo(a,h)anthracene 3

Fluoranthene

Fluorene Indeno(1,2,3-cd)pyrene Naphthalene

Phenanthrene Pyrene

Total Dioxin/Furan Methyl ethyl ketone (delisted 12-15-05) Methyl chloroform
1,1,2-trichloroethane 3

Bis(2-ethylhexyl) phthalate

Carbon tetrachloride 3

Dibutyl phthalate 3

Hexachlorobenzene 3

Methyl iodine 3

Methyl isobutyl ketone 3

n-nitrosodimethylamine 3

Cresols 3

Perylene 3

Pentachlorophenol 3

Phthalic anhydride 3

Quinoline 3

Trans-1,3-dichloropropene 3

Trichloroethylene 3

Vinylidene chloride 3

1-methylnaphthalene 3

2-chloronaphthalene 3 Organic HAPs (cont.)

Dioxins are organic HAPs. Radionuclides ar e covered under the surrogate PM emission limit. Cyanides and its chemical forms are i norganic, and are covered under the HCl and HF surrogacy for acid/inorganic HAPs. All HAP emissions that the boilers are expected to emit are appropriately covered in the permit applic ation and limited in the draft permit.

Comment : The MACT analysis is based on inappropriate grouping of HAPs and t he use of inappropriate surrogates for each group. The Draft Permit only contains direct MACT limits for mercury, hydrogen chloride, and hydrogen fluoride. In addition, the MDEQ treated groups of HAPs together and set limits on surrogate pollutants as MACT for each group. In sum, MDEQ considers and purportedly includes limits on fo ur categories of HAPs: mercury, metallic HAPs, organic HAPs, and inorganic HAPs. This appr oach both fails to set limits for all HAPs and unjustifiably uses surrogates for others.

Response : Links and relationships were est ablished between each surrogate and its respective group of HAPs. As discussed in more detail below, each of the surrogate emission limits satisfy the legal standard for using a surrogate pollutant for a group of HAPs: (1) the HAPs are invariably present in the surrogate pollutant; (2) the control technol ogy for the surrogate

### Wolverine Power Supply Cooperative, Inc. Response to Comments Document Page 58 of 140 June 29, 2011

pollutant indiscriminately capt ures the HAPs along with the surrogate pollutant; and (3) the control for the surrogate pollutant is the only means by which fa cilities achieve reductions in

emissions of the HAPs. NDRC v EPA , 353 F3d 976, 984 (DC Cir 2004); National Lime Ass'n

v EPA , 233 F3d 625, 639 (DC Cir 2000).

As also discussed below, the surrogate emi ssion limits satisfy the MACT requirements because they are not less stringent than the emission control achi eved in practice by the best controlled similar source and they reflect the maximum degree of reduction in emissions that the MDEQ, taking into consideration the cost of achieving such emission reductions and any non-air quality health and environmen tal impacts and energy requirements, has determined is achievable by the proposed facility.

Comment : An emission limit for filterabl e particulate matter is not a proper surrogate for non-mercury

metallic HAPs because it does not satisfy the legal standard fo r using a surrogate pollutant for a group of HAPs. First, HAP metals are not invariably present in particulate matter at the

inlet to the fabric filter because some H AP metals (such as arsenic and selenium) are present as gases at that loca tion. Second, particulate c ontrols for coal plants do not indiscriminately capture HAP me tals because they do not capture HAP metals at the same rate as other particulates and, instead, favor la rger, non-metallic HAP-l aden particles. Fabric filters allow most of the metallic HAPs (which ex ist primarily in smaller particles) to escape. Third, facilities achieve reducti ons in HAP metal emissions by means other t han PM control such as switching fuels. In addition, swit ching fuels would decrease HAP metal emissions without a corresponding reducti on in PM emissions.

Response : The use of PM as a surrogate for non-mercury metal (particulate) HAPs is reasonable based on the criteria established by the U.S. Court of Appeals for the D.C. Circuit: (1) non-mercury metal HAPs are invariably present in PM; (2) PM control technology indiscriminately captures non-mercury metal HAPs along with other particu lates; and (3) PM cont rol is the only means by which facilities achieve reductions in non-mercury metal HAP emissions. National Lime

, 233 F3d at 639; Sierra Club , 353 F3d at 984.

First, PM generated by coal-f ired combustion units invariab ly contains metal HAPs.

Bituminous and subbituminous coal s can contain antimony, ars enic, beryllium, cadmium, chromium, cobalt, lead, manga nese, nickel, and selenium. 16 These metal HAPs are

released when coal is combusted. In elemental form, mo st of these metal HAPs have boiling points greater than 1,000oF. The exceptions ar e lead with a boiling point of approximately 620oF and selenium with a boiling point of approximately 420oF. 17 The exhaust gas temperatures in the fabric filter will be appr oximately 200oF. At t hese temperatures, metal HAPs will be solid and in a particulate form that can be removed fr om the exhaust gases prior to discharge out of the stack. Res earch on bituminous and subbituminous coals has

shown that trace metallic element concentrations in t he fly ash fraction exis t in both PM <2.5 μm and PM >2.5 μm. Measurements of PM from fabric filters indicate collection efficiencies of greater than 99% for particul ates with diameters of 0.02 to 10 μm. For the bituminous and

16 Study of Hazardous Air Pollutant Emissions from Electric Utility Steam Generating units – Final Report to Congress, EPA-453/R-98-004a, February 1998, Volume 2, Table A-1.

17 CRC Handbook of Chemistry and Physics, 53 rd Edition, 1972-1973.

### Wolverine Power Supply Cooperative, Inc. Response to Comments Document Page 59 of 140 June 29, 2011

subbituminous coals analyzed, 4 to 7% of the particulate matter from fabric filters was <2.5 μm while the remainder was >2.5 μm. 18

Second, the PM control required by the propos ed permit (a fabric filter) indiscriminately captures non-mercury metal HAPs along with ot her particulates, regardless of whether the

fabric filter does not capture PM and some non-mercury metal HAPs at the same rate. When the fabric filter removes PM, non-merc ury metal and particulate HAPs are also

removed.

Third, the commenter does not identify any similar sources tha t, by switching fuels, achieve reductions in non-mercury metal HAPs emissi ons without a correspon ding reduction in PM emissions. Similarly, the MDEQ has not identified any such s ources. PM is the only means by which similar sources achieve reductions in the emission of non-mercury metal HAPs, regardless of the potential vari ability of non-mercury metal HAPs in different fuels. The

criteria for the reasonable use of PM as a surr ogate for non-mercury metal HAPs is satisfied.

U.S. EPA has used filterable PM as a surrogate for non-mercur y metal HAPs from various source categories, including glass manufacturi ng facilities, chemic al manufacturing areas, and mineral wool production facilities. 72 Fed Reg 73,180 (Dec. 26, 2007); 72 Fed Reg 38,884 (July 16, 2007); 64 F ed Reg 29,491 (June 1, 1999). 19 Other states have used filterable PM as a surrogate for HAP meta l emissions in their case-by-case MACT

determinations. 20

Comment : MDEQ’s proposal to group together all organi c HAPs from the Proposed Coal Plant and use VOCs as a surrogate is unsupported and VOC is not a proper surrogate for the organic HAPs group. There is no explanation of whether or how the “organic HAPs” grouping is appropriate. In fact, the behavior of the va rious organic HAP compounds are dissimilar in terms of, for example, how some are formed and t heir fate after leaving the boiler. There are also different classes of organic HAPs (vol atile, semi-volatile, and particulate compounds) that behave differently during combustion. In addition, VOC control does not indiscriminately capture organic HAPs, and fac ilities achieve reductions in or ganic HAP emissions by means

other than VOC control. VOC c annot be a surrogate for HAPs.

Response: VOCs are an appropriate surrogate for organic H APs based on the three-part legal standard for surrogates. First, all organic HAPs from the proposed facility are invariably present as VOCs. As explained in the Public Participat ion Documents, organic HAPs are a subset of VOCs and are produced during the combustion of coal. Second, organic HAPs and VOCs are produced as a result of incomplete co mbustion. Good combustion practices that promote complete combustion of coal in the boi ler is an effective pollution control measure

18 Comparison of Particle Size Distri butions and Elemental Partitioning from the Combustion of Pulverized Coal and Residual Fuel Oil, Journal of the Air & Waste Managem ent Association, Volume 50, August 2000, pp. 1532 – 1544.

19 EPA also used filterable PM as a surrogate for HAP metals in its MACT standard for Industr ial/Commercial/Institutional Boilers and Process Heaters. 69 Fed Reg 59,218 (Sept. 13, 20 04). Although the standard was vacated by U.S. Court of Appeals for the D.C. Circuit, the court' s ruling was not based on the use of filterable PM as a surrogate. 489 F3d 1250 (DC Cir 2007).

20 See e.g., Georgia Dept. of Nat. Res., Environmental Protection Di vision, Notice of MACT Approval for Longleaf Energy Associates, LLC (June 2009); South Carolina Dept. of Health and Env. Control, Bureau of Air Quality, Final Determination and Final Notice of MACT Approval for Santee Co oper Pee Dee Generating Station (Dec 16, 2008).

### Wolverine Power Supply Cooperative, Inc. Response to Comments Document Page 60 of 140 June 29, 2011

for VOCs and indiscriminately captures both VO Cs and organic HAPs. Third, similar sources

do not use means other than good combustion practices to control organic HAPs.

Comment : There are pollution-control methods that w ould reduce the Proposed Coal Plant’s organic HAP emissions without producing a correspond ing reduction in the plant’s VOC or CO emissions. Combustion optimization will incr ease some organic HAPs, reduce some organic HAPs, and have no effect on other organic HAPs. Other VOC controls, such as substituting alternative fuels (natural gas, or distillate oil) would reduce organic HAPs at a far higher rate than they would reduce carbon monoxide.

Response: The MDEQ has not identified any similar facilit ies that employ such other means and the commenter has not identified any such facilities. Other similar facilities use good combustion practices to reduce organic HAP emission rega rdless of the type of fuel combusted.

Comment : The Draft Permit proposes to require as a su rrogate a VOC limit that is subject to only periodic (annual) stack testing. Such stack testing is further ev idence that VOC is an improper surrogate because, measured occasiona lly, VOC emissions lack the necessary indiscriminating correlation with organic HAP emissions. Organic HAPs that are caused by incomplete combustion can be produced in la rge quantities during short "hot spot," incomplete-combustion events, such as burne r malfunction, startups and shutdowns. Infrequent stack testing likely occurs outside of these periods and fails to capture the organic HAP emissions during these "hot spot" events . The periodic testing further demonstrates that VOCs are not an appropriate su rrogate for organic HAP emissions.

Response: Periodic stack testing of VOC emissions is only one permit requirement to ensure good combustion practices. CO is formed as a resu lt of incomplete combustion of a hydrocarbon fuel. The permit requires that Wolverin e demonstrate good co mbustion control by continuous monitoring of CO emi ssions. Continuous monitoring of CO emissions is used to, among other things, reduce the ai r to fuel ratio to ensure t he maximum combustion of fuel,

which in turn ensures minimum VOC emission s, including organic HAPs. In addition, continuous monitoring of CO assures minimizati on of organic HAP emissions at all times.

Comment : VOC cannot be used as a surrogate for organi c HAPs because the MDEQ has not shown that more specific, tailored limits for organic HAPs are not feasible. The applicant should be required to set limits upfront on individual HAPs and organic HAP subgroups and conduct post-construction testing (particularly for cy anide and dioxins) and revise limits as appropriate.

Response: The feasibility of limits tailored to organic HAPs is not the legal standard for determining

whether it is reasonable to us e a surrogate emission limit for a group of HAPs. As discussed previously, the U.S. Court of Appeals for the D.C. Circuit has estab lished a three-part legal

### Wolverine Power Supply Cooperative, Inc. Response to Comments Document Page 61 of 140 June 29, 2011

standard for using surrogates. The MDEQ has satisfied that standard in using VOCs as a surrogate for organic HAPs.

The VOC emission limit is the surrogate limit fo r organic HAPs. Post-construction testing is required to demonstrate compliance with that li mit. Given the lack of individual limits for each organic HAP, stack testing for individual or ganic HAPs is not requi red. The individual HAPs that will be emitted from the proposed facility and that are in cluded in the organic HAPs group are listed in Table 1.

Comment : Any surrogate MACT limit for VOC must be bas ed on a short-term average, on the order of one hour. Compliance with periodic stack tests of VOC, as is curr ently required by the permit, will not protect against very high organi c HAP emissions that can occur over short periods.

Response: The averaging time is defined by the test protocol as required by Rule 1003(5) of Michigan's

Air Pollution Control Rules. That rule states : “Minimum sample time shall be 60 minutes, which may be continuous or a combination of shorter sampling periods for sources that operate in a cyclic manner.” Compliance with the VOC emission limit will therefore be based on a short-term average. As for “very high or ganic HAP emissions that can occur over short periods,” spikes in organic HAP emissions w ill be minimized because good combustion will be monitored continuously th rough CO emissions.

Comment : For acid/inorganic HAPs and HCl/HF as surrogat es, MDEQ must confirm whether cyanides are considered as part of the inorganic HAPs group or some other group/surrogate. If cyanides are not consider ed as part of any of the groups, MDEQ must address this omission before issuing a revised permit.

Response: Cyanides are considered i norganic compounds. The surrogates for cyanides are HCl and HF. Cyanides will be controll ed using the same reduction tec hniques used for HCl and HF,

and reduction in HCl and HF emissions will be indicative of reductions in cyanides.

Comment : MDEQ failed to properly assess the MACT floor for each HAP. The permit limits do not constitute MACT, as they are not based on the emissions achieved in practice by the best

controlled similar source. Neither Wolverine no r the MDEQ has correctly identified the “best

controlled similar source” for each of the HAPs emitted by the WCEV. MDEQ inappropriately

narrowed the universe of “simila r source,” resulting in MACT limits impermissibly based on the Applicant’s preferr ed configurations and cont rol strategy for meeting BACT requirements.

Response:

"Similar source" is defined in both the federal regulations and Michigan's Air Pollution Control Rules as "A stationary source or process that has comparable emissions and is structurally similar in design and capacity to a constructed or rec onstructed major source such that the

### Wolverine Power Supply Cooperative, Inc. Response to Comments Document Page 62 of 140 June 29, 2011

source could be controlled using the same c ontrol technology." 40 CFR 63.41; 2008 AACS, Rule 299(2)(b).

The MDEQ identified the best c ontrolled similar source for all MACT limits after extensive
research. The MDEQ's review included a t horough search of emission limits and test results, EPA's TTN RACT/BACT/LAER Clea ringhouse (RBLC), proposed regulations, and literature. Information from over 70 power plants, including PC boilers and CFB boilers, was surveyed in the MACT determinat ion. As discussed below, the MDEQ correctly established

MACT limits for the HAPs to be em itted from the proposed facility.

Comment : The MDEQ does not “make a reasonable esti mate of the performance” of the bestcontrolled unit in the appropri ate category, but references on ly a select few other power plants for all of the HAPs in question. While several plants are addressed for mercury alone, the only comparison for all the other HAPs (albeit with regard to inappropriate surrogates) appears to have been the JEA Northside plant in Florida. This limited citation and failure to compare sources in the determinatio n itself is insufficient to set MACT. In other words, the agency started with the applicant’s proposed boiler and the fuel selected by the applicant for the mercury MACT analysis (notabl y only one of the many fuel s the boiler will be capable of burning) and eliminated any sources that did not fi t that exact configurat ion. This narrowing is arbitrary and capricious.

Response: Information from over 70 power plants was su rveyed for best controlled similar sources and

used in the MACT determination. Four sources were highlighted as best for a number of different HAPs. A large source pool of info rmation was developed to compare sources for

the MACT determination t hat was sufficient.

PC boilers burning bituminous and subbituminous coal, and petroleum coke (not an “exact configuration”) were not omitted or elimi nated from the MACT determination. For the mercury emission limit and other MACT limits, all possible fuel combinations had to be

evaluated and the emission limit assessed fo r continuous compliance under all operating

scenarios. This is not a “narrowi ng” that “is arbitrary and capric ious,” but a broad analysis to

derive an emission limit.

Comment : The MACT limit may not be based on the worst case fuel for each HAP or group of HAPs. MACT requires a limit reflecting the maxi mum degree of reduction in emissions, where “process changes” and “substitution of materials” must be considered as control options. Using a different fuel qualifies as a process change and/or substitution of materials. Where, as here, a source is entirely c apable of burning a range of fuels, it is wholly inappropriate to base MACT on the worst possible fuel for each HAP or group of HAPs.

Response: The CFB boilers are designed and capable of burn ing a range of different fuels. The type

and amount of fuel combusted in the CFB boilers is closely tied to availability (e.g., transportation, cost, growing seasons, etc.). In addition, the permitted operation of the units is for a blend or variety of fuels to be fired at any given time. The MACT determination was

### Wolverine Power Supply Cooperative, Inc. Response to Comments Document Page 63 of 140 June 29, 2011

based on the maximum achievable control for t he types of fuels proposed to be combusted while maintaining fuel flexibility as a practical consideration.

Comment : It is appropriate to set separate MACT limits for each fuel – i.e., PRB coal, Illinois bituminous coal, pet coke, and biomass.

Response: Setting separate limits was evaluated and deem ed impractical for CFB boilers designed for fuel flexibility. Also, setting a limit specific to each fuel type may not result in additional

reductions in HAPs because the type of fuel that will be combusted in the boiler will be determined based on availability.

Comment : MDEQ also improperly selected purport edly appropriate control technologies based on the Applicant’s proposal, and calc ulated emissions limits based on the expected performance of these technologies. While cont rol methods and technologies ar e part of the MACT analysis, the MACT floor is not set by reference to par ticular technologies. The MDEQ must base its

limits on the actual emis sions of the best contro lled existing source.

Response:
The MDEQ based its MACT floor determinations on the actual emissions (i.e., data from test results) for each best controlled similar sour ce. In addition, the MACT emission limits need to account for variability in fuels and correspondi ng performance in the pollution controls to assure the emission limit represented by the bes t controlled similar s ource can be achieved consistently. To ensure t he MACT emission limits are based on realistic operation rather than solely on test results from stack test s performed under optimum conditions, the MDEQ used safety factors in calculating the limits. The safety factors take into account the fuel characteristics and variability in the anticipated performance of the pollution controls for mercury and the HAP surrogates. Also, if test dat a does not fully represent the source or is very scarce, safety factors are adjusted to account for the quality and quantity of data used to establish the MACT emission limit. Safety factors are calculated bas ed on the statistical variability of the data available.

Comment : The MDEQ’s proposed MACT limit for non- mercury metallic HAP is a filterable PM10 emission limit of 0.010 lb/MMBtu, based on an un specified averaging time to be determined later in a test protocol. Even if all of the ot her portions of the analys is were acceptable, the lack of averaging time renders th is MACT determination deficient.

Response: The averaging time is defined by the test protoc ol as required by R 33 6.2003. Specifically, “Minimum sample time shall be 60 minutes, which may be continuous or a combination of shorter sampling periods for sources that operat e in a cyclic manner.” This meets the requirements of the NSR Manual for a “reas onable averaging time in order to be

enforceable.”

### Wolverine Power Supply Cooperative, Inc. Response to Comments Document Page 64 of 140 June 29, 2011

Comment : The proposed limit of 0.010 lb/ MMBtu is greater than the MACT floor. A stack test at Santee Cooper’s Cross Unit 3 showed filterable PM10 emissions of 0.0099 lb/MMBtu in January 2008. As the PPD notes, even the highest PM emission level from JEA Northside, Unit 1 while burning 75% petroleum coke and 25% coal (a blend very close to that identified by Wolverine as its “design fuel”), 0.0091 lb/MMB tu, is below the proposed MACT limit for

Wolverine. The PM10 MACT floor should be no greater than 0.006 lb/MMBtu, based on a 3-hour average, or roughly 40% lower t han the limit proposed by the MDEQ as MACT.

Response: The proposed limit and the test results of 0.0099 lb/MMBtu and 0.0091 lb/MMBtu are within the range of the test method accuracy and are bas ically similar numbers. The emission limit is stringent but not so stri ngent that it can not be achieved continuously. This was

determined based on the fact that JEA Nort hside for example has emission tests demonstrating lower particulate emission rates under a variet y of operating conditions as

evidence that the emission limit can be achi eved on a continuous bas is. The commenter’s proposed limit of 0.006 lb/MMBtu does not contain an acceptable fa ctor of safety that would assure continuous compliance.

Comment : The lowest BACT limits for CO of 0.15 lb/MMBtu (based on a 30-day average) and a VOC limit of 0.003 (based on an unspecified test protocol) are inappropriate for MACT.

Response: CO is not proposed as a surrogate for organic HA Ps, therefore the CO emission limit was not part of the MACT determination. The VOC lim it is the surrogate for organic HAPs, and the test protocol will be specifi ed and approved because the draft permit requires submission of an approvable test plan before compliance testing.

The proposed VOC limit of 0.003 lb/MMBtu co uld have been explained better. VOC

emissions from combustion sources are rela ted to the organic content of the fuels combusted and good combustion practices. VOC emissions are uncontrolled and can fluctuate widely, therefore ma king it difficult to assess an emission limit. Typically, the organic content of subbituminous coal is higher than bitumino us coal, and petroleum coke has a lower organic content than coal. The hi ghest organic content fuel that Wolverine is proposing to combust is the biomass. Data is limited for VOC emissions from all of the fuels that Wolverine is proposing to combust. De cisions on the VOC emissi on limit for Wolverine were mainly based on the performance of JEA Northside which combus ts bituminous coal and petroleum coke, two of the lower organic c ontent fuels. The tw o CFB boilers at JEA

Northside had measured VOC emissions of approximately 0.0014 lb/MMBtu when combusting a blend of 90% petroleum coke/10 % coal. This emission rate was higher than

the VOC emission rate of 0.00025 lb/MMBtu measured when combusting a blend of 70% petroleum coke/30 % coal. The blend of 70% petroleum coke/30 % c oal should contain a higher organic content, and in theory result in higher VOC emissions. In contrast, when combusting 100% coal, unit #1 had VOC emissions of 0.0023 lb/MMBtu measured at 104% of allowed process rate and unit #2 had VO C emissions of 0.000016 lb /MMBtu measured at 92% of allowed process rate. Since VOC em issions were unpredictable and based on lower organic content fuels, a cons ervative 0.003 lb/MMBtu was assessed for the VOC emission limit which represents a 30% factor of safety over JEA Northside’s highest VOC test while combusting coal.

### Wolverine Power Supply Cooperative, Inc. Response to Comments Document Page 65 of 140 June 29, 2011

Comment : The MDEQ has proposed an HCl limit of 0. 0011 lb/MMBtu, with an unspecified averaging time. The lack of an averaging time makes this a deficient and unenf orceable permit limit. Also, for the purpose of setting the HCl limit, Illinois bituminous coals was considered to be the appropriate fuel, despite the fact that it is intended to be a secondary fuel used when pet

coke and PRB are limited due to market condi tions. This was done simply to obtain the highest limit possible, as Illinoi s bituminous coal contains the highest chlorine content of the

considered fuels. The fuel on whic h the limit is based thus has little relationship to how the Proposed Coal Plant will actually operate, making the limit a sham.

Response: The averaging time is defined by the test protoc ol as required by R 33 6.2003. Specifically, “Minimum sample time shall be 60 minutes, which may be continuous or a combination of shorter sampling periods for sources that operate in a cyclic manner.” The limit is sufficient

and enforceable. The limit of 0.0011 lb/MMBtu encompasses the fact that CFB boilers are designed and capable of burning a range of different fuels. The type and amount of fuel proposed to be combusted in the CFB boilers are closely tied to availability (e.g., transportation, cost, growing seasons, etc.) In addition, the intended oper ation of the units is for a blend of fuels to be fired at any given time. The MACT determination was based on the maximum achievable control for the types of fuels proposed to be combusted while maintaining fuel flexibility as a practical considerati on not “simply to obta in the highest limit possible.”

Comment : The HCl and HF limits appear to be based on spec ific controls with no proof as to the basis

for the 95% control claim. No design details for the controls are provided that would support such a removal efficiency. Wh ile such efficiencies are possible, the relevant design parameters should be specified.

Response:

The 95% is based on the best c onceptual design for the specific control strategy that is required via permit condition. The engineering design and design-to-build drawings have not been completed for the source so specific design details are not available.

Comment : The MACT floor should be the lowe st limit that is achievable regardless of fuel, as fuel selection is one of the controls for HAPs (“p rocess changes,” “design,” and “substitution of materials” are pollution-reduction methods t hat must be assessed as part of a MACT determination). Other states have perfo rmed MACT analyses for similar sources and

concluded that MACT is much lower than inferred here for the Proposed Coal Plant. Kentucky established a MACT limit for hydrog en chloride of 0.000825 lb/MMBtu in October

2002 for a bituminous coal fired pulverized coal fired boiler.

Response:

Determination of the MACT floor has to take into account fuel. For example, acid gas emissions from the combustion of natural gas are different from acid gas emissions due to

coal combustion. What is bei ng combusted is very important in a MACT determination for a

### Wolverine Power Supply Cooperative, Inc. Response to Comments Document Page 66 of 140 June 29, 2011

combustion source. The statement that “the MACT floor should be the lowest limit that is achievable regardless of fuel” is incorrect and would lead to an unenforceable limit.

Thoroughbred Generating Station, in Kentucky, will have a wet FGD and wet ESP, and is not strictly speaking a similar sour ce. Since these units are not operating, the HCl emission limit

of 0.000825 lb/MMBtu has not been achieved in practice.

Comment : Stack testing indicates that similar source s routinely achieve lower hydrogen chloride emissions. The Gilbert Unit 3 circulating flui dized bed boiler achieved a hydrogen chloride

emission level of less than 0.000056 lb/MMBtu while burning bituminous coal. The U.S. Department of Energy measured hydrogen chlori de emissions from 16 different coal burning boilers, including with and without various control options, such as reburn, low NO X burners and selective noncatalytic reducti on. This study demonstrated t hat several of the facilities emitted lesser amounts of hydrogen chloride th an proposed here, over a decade later, as MACT. These include Springerville (less than 0.000176 lb/MMBtu), Yates (0.000742 lb/MMBtu), Bailly (0.00102 lb/MMBtu), Bu rger using SNCR (0. 00077 lb/MMBtu), Arapahoe uncontrolled (0.000630 lb/MMBtu), Arapahoe using SNCR (0.000720 lb/MMBtu), and Shawnee using lime injection with fabric filters (less than 0.000073 lb/MMBtu).

Response: Testing results for HCl emissions from sour ces that could be identified as similar to Wolverine’s CFB boilers are limited. And, st ack test results represent limited data and may not demonstrate the variability of chlorine in coal and the variabili ty of operating conditions.

The testing information listed by the commenter does not est ablish that these are similar

sources or that the HCl emissi ons are consistently achieved in practice. Gilbert, Unit 3

combusts a run-of-mine eastern bituminous which is not simila r to any fuel Wolverine is proposing to combust. Gilbert is not a similar source based on fuel.

Stack testing is a measure of performance, but the MACT emission limit should not be set at the lowest single test result ever achieved by a best controlled similar source, and when working with small sets of source test data to assess an emission limit, an appropriate safety

factor needs to be assessed.

Based on available information, it appears that the MACT emissi on limit for HCl for Wolverine’s two proposed CFB boilers is appropr iate without being too overly conservative.

Comment : The MDEQ has proposed an HF limit of 0. 0003 lb/MMBtu, with an unspecified averaging time. The lack of an averaging time makes th is a deficient and unenforceable permit limit. As with HCl, Illinois bituminous coals was consider ed to be the appropriate fuel. Again as with HCl, this selection was made simply to obtain the highest limit possible and has little direct relationship to how the Proposed Co al Plant will actually operate.

Response: The averaging time is defined by the test protoc ol as required by R 33 6.2003. Specifically, “Minimum sample time shall be 60 minutes, which may be continuous or a combination of shorter sampling periods for sources that operate in a cyclic manner.” The limit is sufficient

### Wolverine Power Supply Cooperative, Inc. Response to Comments Document Page 67 of 140 June 29, 2011

and enforceable. The HF limit encompasses t he fact that CFB boilers are designed and capable of burning a range of di fferent fuels. The type and amount of fuel proposed to be combusted in the CFB boilers are closely tied to availability (e.g., transportation, cost, growing seasons, etc.) In addition, the intended o peration of the units is for a blend of fuels to be fired at any given time. The MA CT determination was based on the maximum achievable control for the types of fuels pro posed to be combusted while maintaining fuel flexibility as a practical consi deration not “simply to obtain the highest limit possible.”

Comment : The MACT floor should be the lowe st limit that is achievable regardless of fuel, as fuel

selection is one of the controls for HAPs. Other states have perform ed MACT analyses for

similar sources and concluded that MACT for HF is much lower than Wolverine’s HF limit. West Virginia issued a permit for the Longvie w facility, two CFB boilers that will burn bituminous coal, with a hydrogen fluoride limit of 0.00001 lb/MMBtu.

Response:

Determination of the MACT floor has to take into account fuel. For example, acid gas emissions from the combustion of natural gas ar e totally different from acid gas emissions due to coal combustion. What is being co mbusted is very important in a MACT

determination for a combustion source.

Also, Longview is a proposed pulverized coal-fired boiler not two CFB boilers. The plant has not been built, and therefore the HF emission lim it has not been demon strated as achieved in practice nor is the source considered similar to Wolverine’s proposed CFB boilers.

Comment : Stack testing indicates that similar source s routinely achieve lower hydrogen fluoride emissions. The Gilbert Unit 3 circulating fl uidized bed boiler achieved a hydrogen fluoride

emission level of less than 0.000056 lb/MMBtu while burning bituminous coal. The JEA Northside circulating fluidi zed bed boilers tested at less than 0.0000309 lb/MMBtu while burning 100% Pittsburgh 8 coal; at 0.0000169 lb/ MMBtu while burning a 50:50 blend of coke and Pittsburgh 8 coal; at 0.0000458 2 lb/MMBtu while burning 100% Illinois 6 coal; and at less than 0.0000053 lb/MMBtu while burning a blend of 80% coke and 20% Pittsburgh 8

coal.

Further, the U.S. Department of Energy m easured hydrogen fluoride emissions from 16 different coal burning boilers, including with and without various control options, such as gas reburn, low NOX burners and selective noncatalyt ic reduction. This st udy demonstrated that

several of the facilities emitted lesser amount s of hydrogen fluoride than proposed here, over a decade later, as MACT. These include Springerville (<0.000092 lb/MMBtu), Yates (0.000122 lb/MMBtu), Nelson Dewey (0.000067 lb/MMBtu), Burger using SNCR (0.000039 lb/MMBtu), and Shawnee using lime injecti on with fabric filters (<0.000023 lb/MMBtu).

Response: The testing information from the U.S. Departm ent of Energy listed by the commenter does

not establish that these are si milar sources or that the HF emissions are consistently achieved in practice. Gilbert, Unit 3 combusts a run-of-mine eastern bituminous which is not similar to any fuel Wolverine is proposing to co mbust. Gilbert is not a similar source based

on fuel.

### Wolverine Power Supply Cooperative, Inc. Response to Comments Document Page 68 of 140 June 29, 2011

Stack testing is a measure of performance, but the MACT emission limit should not be set at the lowest single test result ever achieved by a best controlled similar source, and when working with small sets of source test data to assess an emission limit, an appropriate safety

factor needs to be assessed.

As for the proposed HF emission limit, the stac k testing results from JEA Northside were revisited. Again, emission lim its should not be set at the lowe st single stack testing result ever achieved, and JEA Norths ide has had higher emissions of HF. Unit #2 had HF emissions measured at 0.261 lb/hr (equivalent to 0.00010 lb/MMBtu) while combusting 100% petroleum coke, and while combusting 100% coal , HF emissions were measured at 0.290 lb/hr (equivalent to 0.00011 lb/MMBtu). It is appropriate to lower the proposed HF emission

limit for Wolverine’s CFB boilers to 0.00014 lb/MMB tu which provides a 30% factor of safety.

Comment : The MDEQ established the MACT limit for me rcury as 0.0077 lb/GW-hr on an annual average basis, using the mercury content of PRB coal. This lim it is equivalent to 0.882 lb/TBtu, in terms of heat input.

The one glaring flaw in the calculated limit rela tes to the use of PRB coal as the basis. The WCEV is expected to use as its fuel up to 70% pet coke, a fuel with very low mercury content. WCEV has every incentiv e to use as much pet coke as allowed under the permit given the far lower cost of pet coke as compar ed to other fuels. However, the mercury limit assumes that, on an annual basis, PRB coal will be used at all times. It is clear that the mercury limit is significantly over-estimated. As discussed earlie r, without conc eding that the

MACT limit must be set on the cleanest fuel for mercury, separate mercury limits at least should be developed for each proposed fuel. T he annual average mercury limit should then reflect the actual proportion of f uels used and their respective limits.

Response: As stated earlier, CFB boilers ar e designed and capable of burning a range of different fuels. The type and amount of fuel proposed to be com busted in the CFB boilers are closely tied to availability (e.g., transportation, cost, growing seasons, etc. ) In addition, the intended operation of the units is for a blend of fuels to be fired at any given time. The MACT

determination was based on the maximum achiev able control for the types of fuels proposed to be combusted while maintaining fuel flexibilit y as a practical consi deration. There is no “glaring flaw” in the use of PR B coal as the basis of the mercury emission limit. Mercury

emissions from the combustion of PRB coal are expected to be the hardest to capture and control, and are dependent on the effectiveness of the sorbent injection system. Wolverine’s CFB boilers were evaluated to combust up to 100% PRB/subbituminous coal. Setting separate limits was evaluated and deemed impr actical for CFB boilers designed for fuel flexibility. Also, setting a lim it specific to each fuel ty pe may not result in additional

reductions in HAPs because the type of fuel that will be com busted in the boilers will be determined based on availability.

Comment : If a more thorough analysis had been conducted by the MDEQ, it would have discovered that the best controlled similar source to the Proposed Coal Plant is the Reliant Energy Seward unit, a CFB boiler whose mercury emissions have been tested at 0.03 lb/TBtu. At this rate,

### Wolverine Power Supply Cooperative, Inc. Response to Comments Document Page 69 of 140 June 29, 2011

each of the proposed coal plant units would have a mercur y emission rate of approximately 0.8 lb/year, instead of the proposed 23.4 lb/yr, a limit that is approxim ately 29 times greater. In addition, several permits have been issued wi th lower mercury MACT limits. Utah issued a permit in October 2004 to Intermountain Power Generating Station for Unit 3. This 950-MW pulverized coal-fired boi ler will burn subbituminous/bitum inous coal. The Intermountain permit contains a mercury MACT limit of 0.006 lb/GW-hr. This is 22% lower than the limit proposed by MDEQ. Virginia issued a permit in June 2008 to Virginia Electric and Power Company for two CFB boilers (Dominion Wise County) with a combined output of 668 MW.

These boilers would burn coal and waste coal. The permit contains a me rcury MACT limit of 0.000088 lb/GW-hr (0.09 lb/TBtu), or several degrees of magnitude lower than the proposed

MACT limit here.

Response:

Seward combusts a waste bituminous coal t hat Wolverine is not proposing to combust. Therefore, the Reliant Energy Seward unit is not a similar source. The mercury permit limits for Virginia Electric and Power Company, Domi nion were based in part on Seward because the Virginia units will be combusting a bitumi nous coal refuse (gob ) and was considered similar to Seward by the permitting agency.

Intermountain Power, Unit 3 is not operating. The mercury emission limits for Intermountain Power (converted to GW) are 0.006 lb/GW-hr per 12-month rolling average for bituminous coal and 0.020 lb/GW-hr per 12-month rolling av erage for subbituminous coal. The emission

limit for subbituminous coal is higher than the emission limi t assessed for Wolverine’s CFB

boilers.

Comment : Having failed to properly identify the MACT floors, the MDEQ analysis also omits proper beyond-the-floor MACT analyses, as well as the information that would be used in its preparation. This total omission of a required component of the MACT analysis, see 40 C.F.R. § 63.43(d)(2), it self is grounds for invalidating the MACT limits.

Response: The MDEQ disagrees with this comment. Emission controls and lim its beyond what is achieved in practice by the best controlled similar source were reviewed for HAPs. For example, oxidation catalyst control technology (as well as EMx-SCONOX) for organic HAPs, wet ESP for acid gases and metal HAPs, and dem onstration technologies such as electrocatalytic oxidation (ECOTM) for mercury were reviewed and found to be either not cost effective, technically feasible , demonstrated in practice, and/or available for application to a utility-size CFB boiler.

The beyond-the-floor analysis is not complex fo r this project. The CFB boilers have the best

control to meet the MACT floor. There are not any control options that the MDEQ is aware of that are cost effective, tec hnically feasible, demonstrated in practice and/or available for application on a utility-size boiler to set a MACT emission limit bas ed on a beyond-the-floor control technology.

### Wolverine Power Supply Cooperative, Inc. Response to Comments Document Page 70 of 140 June 29, 2011

Comment : The beyond-the-floor analysis fo r mercury is lacking. Alt hough brominated activated carbon injection is proposed, no details on this control are provided. At a minimum, the following information must be supplied to suppor t a beyond-the-floor MACT analysis:

• design basis mercury content of each fuel that is proposed; • uncontrolled mercury emission rate; • design basis of the activat ed carbon system, including cont rol efficiency and basis of the

carbon injection rate used in the cost analysis; Without this information, it is unclear if the proposed 93% reduction rate is MACT. In our opinion, 99% mercury control has been achieved and is achiev able for the subject units using brominated activated carb on, the ReACT technology, or other technologies that are currently available.

Response: The design basis for the mercury content of the fuels is 12.6 lb Hg/TBtu. The uncontrolled mercury emission rate for each CFB boiler is 0. 038 lbs/hr. The design basis for the sorbent injection system is 93% control and the sorb ent injection rate will be dependent on the mercury loading into the system which can be va riable. As for 99% mercury control, whether

that can be achieved on a cont inuous basis under all operating conditions is the question.

Brominated activated carbon is a mature techno logy that is commercially available. The same cannot be said for the ReACT technology nor any other technology for mercury control, since they are st ill in the development stages.

Comment : The alleged MACT limits are not enforceable. Setting aside the improper use of surrogates, the surrogate limits themselves fail in numerous ways to meet enforceability requirements,

as discussed elsewhere in these comments. Li mits that are not enf orceable are not MACT.

Response: The permit contains emission limits for HAPs, and testing, monitoring, and record keeping requirements to demonstrate compliance with t he emission limits. This makes the MACT

limits enforceable.

Comment : The mercury controls proposed by the MDEQ do not meet the requirem ents of the Clean Air
Act because MDEQ did not do a sufficient MACT analysis, and arbitrarily and without reason rejected lower mercury limits that ot her plants are proposing to meet.

Response: The MDEQ disagrees. Operational Memorandum No. 15, “Procedure for Processing Permit Applications Subject to Federal Clean Air Ac t Section 112(g)” establishes guidelines for processing a permit application for a case-by- case MACT determination. The process of determining what is maximum achievable control technology for a source is called a case-by-case MACT determination, and the im plementation regulati ons are adopted by reference in Rule 336.1299(2)(b).

### Wolverine Power Supply Cooperative, Inc. Response to Comments Document Page 71 of 140 June 29, 2011

Comment : Since your previous permitting action on the proposed Wolverin e facility, please be aware that the EPA recently prop osed the National Emissions Standards for Hazardous Air

Pollutants from Coal-and Oil-Fired Electric Utility Steam Generating Units and Standards of

Performance for Fossil-Fuel Fired Electric Ut ility, Industrial-Commercial Institutional, and

Small Industrial-Commercial-Institutional Steam Generating (see 76 FR 24976; May 3, 2011). Please ensure that any applicabl e requirements are reflected in a permit.

Response : The rule has only been proposed and is not fi nal yet. MDEQ does not put proposed rule requirements in PTI’s because the rule may change and then the permit would need to be modified. Also, as stated above, MDEQ properly applied a case-by-case MACT

determination.



### F. Best Available Control Technology (BACT) Review

1. 

### Integrated Gasification Combined Cycle (IGCC)

Comment:

CFB boilers do not achieve emission levels co mparable to IGCC. When compared to IGCC,

CFB boilers come in worse across the board for numerous pollutants. For example, CFB boilers and IGCC do not achieve comparable NOx emissions rates. CFB boiler permit levels for NOx have generally been in the 0.07 to 0.08 lb/MMBtu range. In contrast, expected NOx emissions levels for recently proposed IGCC plants averaged 0.039 lb/MMBtu. NO X levels from IGCC, therefore, are upwards of 45% lower than CFB boilers. IGCC facilities are similarly lower in SO 2 emissions, with 30-day averages at nearly half that proposed for the present CFB boilers (0.033 lb/MMBtu for IGCC versus 0.06 lb/MMBtu for the Proposed Coal Plant). PM10 emissions from IGCC also are significantly lower t han for the Proposed Coal

Plant.

Response: The MDEQ required an evaluation of IGCC as part of the BACT analysis for the proposed facility. On February 25, 2008, Wolverine su bmitted to MDEQ additional information to supplement the permit applic ation for the IGCC BACT analysi s pursuant to the agency’s information request of February 14, 2008. Ba sed on the MDEQ’s review of Wolverine’s submittal, and the comments received, the MD EQ determined that the cost of IGCC is excessive (approximately $26,000 per ton of emi ssions removed for the criteria pollutants)

and that IGCC is not BACT for the proposed facility.

The BACT analysis considered the total annualiz ed costs for IGCC versus the CFB boilers in calculating the costs per ton of criteria pollut ants removed. The high cost of IGCC is due in part to the substantial difference in the cost s of engineering, procur ement and construction (EPC) between IGCC and the proposed. Wolveri ne identified a 37.2% higher EPC cost (i.e., a premium) for a 600 MW IGCC to generat e the electricity Wolverine seeks.

In responding to the emission rates that can be achieved by an IGCC facility, MDEQ concurs that for certain pollutants, an IG CC facility would emit at a lower rate. However, this does not
alter the overall MDEQ conclusion that IGCC is cost prohibitive.

### Wolverine Power Supply Cooperative, Inc. Response to Comments Document Page 72 of 140 June 29, 2011

It is worth noting that in comparing emissions and costs of similar fac ilities, such as those presented by the commenter, t he facilities, although permitted, have not been constructed. No verification of emission rates through stack testing has occurred. In addition, the two known operating IGCC facilities in this country located at Wa bash, Indiana and Polk Unit 1, Tampa, Florida, both had lar ge portions federally funded by the Department of Energy (DOE). A comparative evaluation of costing tec hniques is not reflective of true costs of the project.

In summary, the MDEQ reviewed the detailed IGCC analysis submitted by Wolverine and accurately concluded that IGCC is cost prohibitive in terms of the cost to remove a ton of criteria pollutants.

2. Clean Fuels

Comment:: MDEQ and the applicant failed to consider clea n fuels and low sulfur coal in the BACT analyses. A permittee cannot avoid lower em ission limits achievable with cleaner fuels

based on its desire for “fuel flex ibility”. The applicant and MDEQ may only justify rejecting the top control (cleanest fuel) on other environmental grounds in a proper collateral impacts analysis, including quantific ation of impacts to t he extent possible. The boiler is not limited to

the dirtiest fuels but rather it is capable of burning a range of fuels, incl uding those that release comparatively less pollution.

Response: In the original application, Wolverine submi tted a Fuel Supply and Fuel Selection Study dated November 2007 as prepared by Burns and Roe Enterprises which was performed to identify fuels that would be appropriate fo r the WCEV project. In response to public comment and at the request of the MDEQ, Wolv erine submitted additional information on

their evaluation of clean fuels. This doc ument titled ‘Fuel BACT Review’ is dated June 22, 2009. The Fuel BACT Review supports the fuel selection by Wolverine as representing BACT.

Because the chosen CFB boiler technology is designed to burn multiple fuels, it is appropriate for MDEQ to evaluate Wolverine’s request to use up to 70% pet coke to blend with western PRB coal, while reserving the ab ility to utilize 100% PRB, ILB coal, or 20%

biomass with 80% PRB. It is al so appropriate for MDEQ to evaluate other, ‘cleaner,’ fuels as well. In making this evaluation, MDEQ accept ed the approach by Wolverine to start with a

base case of the chosen boile r and control technology, com paring other ‘cleaner’ fuels against the selected fuels.

The Fuel BACT Review identified the fuel opti ons, including ‘cleaner’ fuels, available to the WCEV project and how the availability of such fuel s is related to the transportation resources

available to the site as well as the emi ssion unit under consideration. The emissions

characteristics and available c ontrol technology are dependent on t he boiler type. Therefore, in addition to considering fuel type, the CFB boiler technology itself must be taken into account. The decision on which generating technology to select was based on

considerations such as the des ired generating capacity, pla nned use of the capacity in meeting load, fuel type, transportation, trans mission, and water and raw material resource availability. Wolverine selected a CFB boiler which can best accommodate western sub-bituminous coal (Powder River Basin), eas tern bituminous coal (Illinois Basin), central

### Wolverine Power Supply Cooperative, Inc. Response to Comments Document Page 73 of 140 June 29, 2011

bituminous coal (Central Appalachia & Nort hern Appalachia), western bituminous coal (Western Canada), pet coke, and biomass. Other fuels, such as natural gas, fuel oil, and biomass used as primary fuels, may require si gnificant boiler modification and/or new boiler design.

Of the coals under considerati on for use in a CFB boiler, t he average coal prices were compared by region, taking into account availa bility, long term stab ility, and transportation costs, and the more economic c oals were chosen. The remaining coals were put through a coal/ash characterization and were screened using cr itical fuel characteri stics including; fuel heating value, sulfur content, as h content, chlorine content, as h fusion temperature, sodium in ash, and mercury in coal. The fuels meeting the necessary criteria were: PRB, Illinois Basin, pet coke, and biomass. Wolverine has proposed to burn western (PRB)

sub-bituminous coal with a ble nd of up to 70% petroleum coke as its primary fuel, and ILB as a secondary fuel. The project’s location within a limestone quarry greatly diminishes the cost impact of using high sulfur fuels because the lim estone is very inexpensiv e, readily available, and can be used as a reagent to capture SO2 in the CFB boiler furnace. According to the Fuel Supply and Fuel Selection Study, burning 1 00% PRB coal or ILB coal are also both available options and are technically feasible.

It is generally known that the co st of coal is related to the heat content in the coal, i. e., the greater the heat content, such as in eastern coal, the more costly the price of this coal. Heat content is the amount of energy that can be generated from a fuel and is reported as MMBtu.

Wolverine has stated that there is no business advantage to use eastern coal, as pet coke

and western coal delivered costs are less expensive at $1.32 per MMBtu and $1.91 per MMBtu, respectively. Eastern coal has a delivered cost of $2.17 per MMBtu. The fuel user (Wolverine) can mitigate the risks of unfores een circumstances in the chosen fuel supply by using fuel flexibility/blending. Examples of such a circumstanc e would be a rail disruption or mine strike which reduce or interrupt supply. The proposed blend of up to 70% pet coke blended with PRB allows Wolverine to mitigat e price fluctuations and maintain supply and transportation reliability. Limiting a base load fa cility to a single fuel supply source is a risk both from a financial and reliability perspective.

Wolverine conducted the Fuel BACT Review ta king into consideration the add-on control equipment selected as BACT. BACT for this pr oject includes the inher ent CFB boiler control and polishing scrubber for SO2, SNCR for NO x, a baghouse for PM10, the polishing scrubber and baghouse for PM2.5, and good co mbustion control for CO and VOC. A pollutant by pollutant review was then conduc ted to determine if a cleaner fuel would be considered BACT. Costs of fuel switching were considered as compared to the base case or in terms of burning western (PRB) sub-bituminous coal with a blend of up to 70% petroleum

coke.

The sulfur content of the fuel is directly related to SO2 generation which is the dominant pollutant in terms of fuel choice. The PRB c oal is known to have lower sulfur content than other coals. The typical sulfur content of PRB coal ranges fr om 0.2 – 1.0%, while ILB ranges

from 1.0% to 3.0%. While the sulfur content of pet coke is higher than coal, ranging from 4.0% to 7.0%, it is not necessa rily a poor choice of fuel. Pet coke burned in a CFB boiler

with the inherent control via the limest one bed along with the add-on polishing scrubber,

results in similar outlet SO2 emissions as ot her boilers burning coal. The CFB boiler design provides an inherent control as t he limestone bed reacts with the sulfur in fuel to provide a removal efficiency of up to 80%. In general, pet coke has a lower ash content (<0.5%), lower moisture content (8-10%) and lower volatiles (8 -10%) than coal, resulting in a much higher

### Wolverine Power Supply Cooperative, Inc. Response to Comments Document Page 74 of 140 June 29, 2011

heat content, on the order of 14, 000 Btu/lb. In comparison, t he heat content of PRB ranges from 8,500 to 9,500 Btu/lb. A higher heat cont ent results in less pet coke needed to achieve the same energy level.

The sulfur content of biomass varies, depending of the type of wood, from 0.01% to 0.10%.

The boiler is limited in the amount of biomass it can burn. According to the Fuel BACT Review “Biomass combustion is limited by the amount of biomass in the region and the fuel

characteristics of the biomass. It has been de termined that a maximum of 20% of the boiler heat input can be provided by biomass.” In addi tion, biomass has the lo west heat content of the fuels considered resulting in more biom ass burned to achieve the same amount of energy as coal or pet coke. The heat content of biomass ranges from 4,000 to 7,000 Btu/lb, depending on the moisture content. Biomass with a higher moisture content can affect flame stability in the boiler and could lead to incr eased CO emissions. A balance of fuels will

assure consistent charac teristics in the boiler. The chosen fuel blends will meet the 0.05 lb

SO 2 per MMBtu, based on an an nual average and 0.06 lb SO 2 MMBtu 30 day rolling average, limits identified as BACT.

NOx emissions result from both fuel bound nitr ogen as well as a result of combustion (i.e. thermal NOx). NOx formation is related to tem perature. Because a CFB boiler operates at a lower combustion temperature than more traditi onal boilers, thermal NOx formation is less significant, making fuel NOx the dominant contributor. Of the fuels reviewed, the Fuel BACT

Review concluded that with the inherent limitations of the SNCR system (i.e. ammonia slip), no fuel identified for review provides an advant age over another in terms of NOx formation or

control.

The Fuel BACT Review concluded that PM10 and PM2.5 emissions are not affected by the

fuel choice as it has been def ined by Wolverine. Emission differences betw een coal types, pet coke and biomass are not significant as they will be controlled by the baghouse which is designed to remove in excess of 99% of the particulate that passes through, independent of the inlet loading.

CO and VOC are products of combustion, form ed when fuels are not combusted completely. BACT for CO and VOC is good combustion. CO may be impacted by use of biomass as wood has higher moisture content and driving this moisture off may affect boiler temperature, thereby increasing CO. A well operated boiler will maintain the temperature in the CFB boiler to optimize combustion. Biomass has benef its as a clean fuel in that it has a lower sulfur and mercury content and is a renewable res ource. However, the boiler is limited in the

amount of biomass it can burn based on concerns over being able to support its use on a

sustainable basis.

The MDEQ also evaluated use of natural gas as a fuel. Natural gas use was addressed in the Fuel Supply and Fuel Selecti on Study as well as in the Electric Generating Alternatives Analysis (EGAA), dated June 8, 2009. Natural gas was not pursued as a viable fuel for long-term energy production due to the price volati lity. The price of na tural gas is referenced in the EGAA. The following table is an excerp t from the EGAA comparing natural gas costs to PRB and pet coke. As the data supports, natur al gas is at least 5 times greater in price

than coal. In addition to the f uel volatility, when assessing co sts for a natural gas plant, the addition of a natural gas pipeline to bring su itable natural gas quantities for base load generation to the Rogers City site must be factored in. It would be cost prohibitive to construct the necessary infrastructure to get natural gas to the plant site.

### Wolverine Power Supply Cooperative, Inc. Response to Comments Document Page 75 of 140 June 29, 2011

Wolverine Screening Curve Fuel Cost Input ($/MMBtu)

Fuel Low Fuel Cost High Fuel Cost Natural Gas $6.15 $13.40

PRB Coal 1.20 4.56

Petroleum Coke 1.00 4.00

Based on these consi derations, MDEQ has determined that burning western (PRB) sub-bituminous coal with a blend of up to 70% petroleum coke as primary fuel, and ILB as a secondary fuel provides "fuel flexibility to manage fuel supply risks" and is a reasonable consideration in the BACT process.

Comment: Including BACT limits based on the cleanest fuel or combination of fuels proposed by the applicant is not redefining the source. The pr oposed plant is specific ally designed to burn a range of fuels, including low sulfur PRB sub bi tuminous coal, higher sulfur Illinois bituminous coal, very high sulfur pet coke, and low sulfur biomass. Basing BACT limits on the cleanest fuel or combination of fuels proposed by the applicant is not redefining the source.

Response: Given the design of the boiler and furnace, Wo lverine determined that the CFB boiler could accommodate, with little or no modification to the burner confi guration, western sub-bituminous coal (Powder River Basin), eas tern bituminous coal (Illinois Basin), central bituminous coal (Central Appalachia & Nort hern Appalachia), western bituminous coal (Western Canada), pet coke, and biomass. T he Fuel BACT Review addressed these fuels and concluded which fuels repres ent BACT. Other fuels, such as natural gas or biomass used as primary fuels, may require significant boiler modification and/or new boiler design.
The MDEQ concurs with the Fuel BACT Review submitted by Wolverine in selecting to burn western (PRB) sub-bituminous coal with a blend of up to 70% petroleum coke as its primary fuel and ILB as a secondary fuel.

Comment:

The claim that Wolverine could not burn clean f uels rings hollow. CFB boilers are capable of burning a wide range of sulfur content fuels.

Response: MDEQ agrees with the statement that CFB boile rs are capable of burning a wide range of fuels. In fact, Wolverine has proposed to burn western (PRB) sub-bituminous coal with a blend of up to 70% petroleum coke as its primar y fuel and ILB as a secondary fuel. The CFB boiler is also being designed to burn up to 20% biomass. The issue of clean fuels was addressed in the June 9, 2009 Fuel BACT Revi ew and Appendix 2, Fuel Supply and Fuel Selection Study. MDEQ concurs with the conc lusions drawn by Wolver ine that the selected fuel mix represents BACT.

Comment:

Fuel choice is relevant to BACT for several regulated NSR pollutants. The applicant rejects the lowest permitted SO2 emissions rates from the AES-Puerto Rico & NEVCO Sevier plants

on the basis that neither is designed to utilize pet coke.

### Wolverine Power Supply Cooperative, Inc. Response to Comments Document Page 76 of 140 June 29, 2011

Response:
MDEQ reviewed both AES Puerto Rico and NEVCO Sevier as part of the permit review and

concluded that emission limits established as BACT for thes e two facilities were not comparable to the Wolverine proposal. Both AES Puerto Rico and NEVCO Sevier proposed to burn low sulfur coal. Wolverine proposed to burn western (PRB) sub-bituminous coal (a low sulfur coal) with a blend of up to 70% pet roleum coke as its primary fuel, and ILB as a secondary fuel. A CFB boiler can accommodate m any different fuels. As stated in the AES permit, permit values identified in the AES per mit were based on the ‘environmentally worst-case coal’ allowed by the per mit, which in this case was 1% sulfur coal. In the case of Wolverine, permit values were also based on the ‘environmentally worst-case fuel’ which in the case of Wolverine was pet coke. Neit her AES Puerto Rico nor NEVCO Sevier is permitted to burn pet coke or higher sulfur coal.

Fuel selection is critical to establishing emission limits. Wo lverine has demonstrated through

the Fuel BACT Review that their selected fuel blend of western (PRB) sub-bituminous coal with a blend of up to 70% petroleum coke as its primary fuel and ILB as a secondary fuel represents BACT. A BACT analysis evaluates mu ltiple criteria, including costs, to determine the appropriate emissions control strategy for the proposed project. Costs of burning a lower sulfur fuel or fuel blend were compared incr ementally against the Wolverine selected fuel

blend and determined to be excessive.

The cost per year of burning PRB (alone), Biomass/PRB blend, or IB alone were compared

to the Wolverine selected fuel blend and determ ined the difference, respectively, as follows: $7,414,697; $17,676, 785; and $15,546,348.

The MDEQ concurs with the Fuel BACT Review submitted by Wolverine in selecting to burn western (PRB) sub-bituminous coal with a blend of up to 70% petroleum coke as its primary fuel and ILB as a secondary fuel.

For comparison purposes, the emission limits for the AES Puerto Rico and NEVCO Sevier

facilities are identified below:

Pollutant Wolverine AES Puerto Rico JEA No rthside NEVCO Sevier

SO2 0.06 (30-day), 0.05(12month), 303 pph (24-hr) 0.022 (3-hr) 0.15 (30 day), 0.20 (24-hr) 0.022 (30-day), 0.05 (24-hr)

NOx 0.07 (30-day), 281.1 pph (24-hr) 0.10 (24-hr) 0.09 (30-day) 0.1 (24-hour)

H2SO4 0.003 (24-hr) 0.0024 (24-hr) 1.1 pph 0.0024 (24-hr)

PM 0.010 0.015 (24-hr) 0.011 0.0154** (24-hr)

### Wolverine Power Supply Cooperative, Inc. Response to Comments Document Page 77 of 140 June 29, 2011

PM10 0.026, 78.8 pph 0.015 (24-hr) 0.011 ** 0.0154** (24-hr)

CO 0.15 (30-day), 744 pph (24-hr) 0.10 (8-hr) 0.22 (24-hr) 0.115 (1-hr)

All limits are in units of lb/MMBtu, unless otherwise noted. **Limit is listed in the permit as PM/PM10.

Comment:

The BACT limits for sulfuric ac id mist (SAM) and PM2.5 must consider use of low sulfur

fuels.

Response: Both SAM and PM2.5 were subject to a BACT re view. The issue of low sulfur fuels was addressed by Wolverine in the Fuel BACT Revi ew. After a thorough top-down BACT review, taking into account ‘clean’ fuels, SAM and PM 2.5 limits as proposed in the Wolverine permit are 0.003 lb/MMBtu and 0.024 lb/MMBtu, respecti vely. The MDEQ concurs with the Fuel BACT Review submitted by Wolverine in sele cting to burn western (PRB) sub-bituminous coal with a blend of up to 70% petroleum co ke as its primary fuel and ILB as a secondary

fuel.

Comment: The amount of particulate matter and NOx ar e also dependent on the fuel source. Combustion of biomass generally results in lower PM and NOx emissions than coal.

Response:

As for the use of biomass in establishing particulate and NOx lim its, the amount of particulate and NOx emissions from biomass use is dependent on the type of biomas s. A decrease in NOx based on a lower operating temperature may re sult in an increase in CO. Particulate may or may not decrease with use of biomass. In any case, the BACT limits established for NOx and particulate are appropriat e and are in line with similar facilities burning a similar fuel combination. After a thorough top-down BACT review, taking into account ‘clean’ fuels, particulate and NOx limits as proposed in the Wolverine permit are 0.010 lb/MMBtu (PM10 limit is 0.026) and 0.07 lb/MMB tu, respectively. The MDEQ concurs with the Fuel BACT Review submitted by Wolverine in selecting to burn western (PRB) s ub-bituminous coal with a blend of up to 70% petroleum coke as it s primary fuel and ILB as a secondary fuel.

Comment: Throughout the draft permit, t he applicant emphasizes fuel fl exibility as a benefit of CFB boiler technology. The prospect of a more di verse fuel stream br ings responsibility to thoroughly characterize the additional potent ial emissions profiles and their impacts on

human health and natural resource s. This responsibility was not met in the draft permit. Until a comprehensive analysis of all possible em issions profiles is provided, the draft permit must be considered incomplete.

Response:

All fuel streams were evaluated and to be conservative (as to not exceed any regulation standards) pollutants showing t he highest emissions were evaluated and compared to all

### Wolverine Power Supply Cooperative, Inc. Response to Comments Document Page 78 of 140 June 29, 2011

state and federal regulations. Impacts on human health were thoroughly reviewed and results of the MDEQ analysis can be found in Section C. Public Health and Environmental

Concerns.

Comment:

No where in the document is the term “bio mass” specifically defined. Any wood waste should be prohibited t hat has been painted or chemically treated.

Response: Biomass is defined in the permit, special conditi on II.3, Material Limits for FGCFB, and does not include materials from building construction or demolition. Painted or chemically treated would is also prohibited. Biomass is def ined as non-chemically treated wood and wood residue, bark, or any derivative fuel or resi due thereof, in any form, including but not limited to sawdust, sander dust, wood chips, scraps, slabs, millings, shavi ngs, processed pellets made from wood or other forest residues, sw itch grass, and other similar fuels.

Comment:
MDEQ failed to evaluate emissions from biom ass fuel hauling. A thorough analysis of emissions from biomass freight operations must be conducted. Key parameters in the analysis should include quantities of various biomass feed st ocks consumed, and average duration and number of truck trips needed to deliver it to the plant. Until a comprehensive analysis of all possible emissions profiles is provided, the draft permit must be considered incomplete.

Response:

Emissions from the use of biom ass as a fuel have been evaluat ed as part of this application review. Roadways and associated truck traffic emissions are covered by the Fugitive Emissions Control Plan (FECP). Due to the variab le nature of the biomass fuel industry it is not known at this time if WCEV will be proce ssing biomass prior to combustion or receiving pre-processed biomass. Off-site freight oper ations are beyond the r egulatory authority of the air permit evaluation.

Comment: The BACT analysis is deficient bec ause it did not consi der the impact of f uel choice on start up and shut down emissions. BACT during start up and shut down should require the

maximum amount of biomass feasible and an acco mpanying reduction in low sulfur coal.

Response: Fuels were considered in the BACT analysis fo r periods of startup and shutdown and limits were appropriately establ ished. Depending on the nature (i.e. cold start, warm start) and duration of the startup, NOx and SO2 can be significantly higher during start up and shut down than during normal operation. The SO 2 and NOx control equipment requires stable boiler conditions for effective operation. E ffective operation of the SNCR to control NOx emissions requires stable flue gas flows and te mperatures greater than 1,500°F to ensure that the injected ammonia reacts with the NOx in the flue gas. Otherwise, ammonia slip can

occur which can contribute to additional particulate emissions . Effective operation of the polishing scrubber to control SO2 emissions, is much the same. Ensuring the proper bed temperature, mixing, availab ility of bed lime for SO2 absorptio n, and operation of the spray

### Wolverine Power Supply Cooperative, Inc. Response to Comments Document Page 79 of 140 June 29, 2011

dryer absorber (SDA) for SO2 control can a ll affect higher than normal SO2 emissions.

Therefore because the control equipment is not fully operat ional during startup #2 fuel oil with 0.05% sulfur, low sulfur coal, and/or biom ass will be utilized in the CFB boilers. NOx and SO2 are inherently lower in those fuels as opposed to the PRB coal and pet coke. After the boiler(s) reaches about 40% load, and the control equipment is operating effectively, then PRB coal and pet coke will begin to be added.

This scenario was determined by MDEQ to represent BACT and BACT emission limits were appropriately set to account for periods of start up and shut down.

Comment: As part of the BACT determination, Wolverine must consider the collateral impacts from fuel choice including the volume of ash that will be produced, t he amount that will be sold for reuse, the amount that will requi re landfill disposal including dis posal costs, as well as the expected content of the ash.

Response: In the Fuel BACT Review analysis, Wolverine addr essed the volume of ash, disposal of the ash, and the cost of disposal. MDEQ re viewed this analysis and determined it to be acceptable.

Comment : Has anyone considered blending anthraci te coal with bituminous coal?

Response: Blending anthracite coal with bituminous coal was not cons idered for this project.

Comment: What is petroleum coke? What is the benefits of its use? What are the risks? Mercury, acids, particulates, HAPs, and other emissions based on 100% sub bi tuminous, 100% Illinois coal, and up to 70% pet coke, 20% biomass, need fu rther consideration. Examples given at other facilities burning pet coke show increased emissions over coal for several pollutants. Given that substantial dirty ta r sand oil is presently being refi ned at locations on the Great Lakes, it should be pres umed that pet coke waste from th is heavy oil would be even more contaminated, especially wi th sulfur and heavy metals.

Response: Petroleum coke, often referred to as pet coke, which is defined as a solid derived from oil refinery coker units or other cracking (break ing long chain hydrocarbons into short ones) processes. This by-product once disposed of in landfills, is now used in the cement industry and utility plants as fuel and raw ma terials. There are many benefits to using petroleum coke as a fuel. It makes a good source of fuel because less fuel is needed on a pound of fuel per million Btu basis as compared to coal. Other benefits include, low as h content, lower cost per ton, and lower mercury conten t, as compared to coal. T he low ash content means there are less emissions of particulate matter. T here are no risks to using petroleum coke, although one disadvantage is it contains a high sulfur content, as compared to coal. However, with the proper add-on control technol ogy to control SO2 emissions, like those that Wolverine has proposed, it is still a good source of fuel for a relatively low price compared

### Wolverine Power Supply Cooperative, Inc. Response to Comments Document Page 80 of 140 June 29, 2011

with coal. The source of petroleum coke that Wolverine is pr oposing has not yet been determined. All petroleum coke emissions ev aluated were based on the Louisiana Cleco Corporation application, in wh ich the facility was permitted to burn 100% petroleum coke.

Comment: How can Wolverine use up to 70% pet coke as a fuel, when they do not have a local permit to burn pet coke?

Response: The state requirements contained in the air per mit to install are based on state regulations the facility must meet. Thos e requirements are separate from any local requirements such as zoning or special use permits.

Comment : Commenter requests that for MDEQ to make public all data used to justify the economic

decisions that are c ontained in this permit. Show the math where there are economic

decisions used to drive environmental decisions within this permit.

Response: All supporting information used in reviewing t he permit application is contained in the permit file and is available by the Freedom of Info rmation Act, including the economic analysis in the BACT review. In addition, Wolverine’s submittals were made available on the MDEQ
AQD website at http://www.deq.state.mi.us/aps/dow nloads/permits/cfpp/cfpp.htm

.

3. Opacity

Comment: The draft permit does not contain a BACT limit for opacity from the boiler.

Response: The draft permit contains a limit of 10 per cent, based on a 6-minute average, except one 6-minute average per hour of not more than 20 percent. MDEQ considers this BACT.

4. PM2.5

Comment : The MDEQ's application of EPA's surrogate policy for PM10 does not satisfy the legal requirements of the CAA for PM2.5. PM2.5 is a regulated new source review pollutant that the proposed facility will emit in significant amounts. The MD EQ must therefore establish

BACT emission limits for PM2.5. Even if the PM10 surrogate policy is lawful, it is no longer appropriate because the technical difficulties on which it is based (PM2.5 moni toring, emissions estimation and modeling) have

been resolved.

Response: A PM2.5 BACT analysis was submitted by Wo lverine on September 30, 2008 and additional supporting information was submi tted on June 22, July 27 and July 29 of 2009. Wolverine

### Wolverine Power Supply Cooperative, Inc. Response to Comments Document Page 81 of 140 June 29, 2011

also submitted an air quality analysis that includes a mode ling demonstration showing that emissions from the proposed facility will not exceed the NAAQS or PSD increments for PM2.5. MDEQ held a public comment peri od from August 18, 2009 through September 17, 2009 with an informational meeting and hearing held on September 17, 2009 to incorporate the PM2.5 BACT limits, stack testing, and moni toring requirements into the draft permit.

Comment: The late submitted PM2.5 BACT analysis s upplement is flawed in numerous ways.

1) The analysis does not discuss t he baghouse design basis and membrane bag technology in sufficient detail in order to determine the removal efficiency.

2) The analysis only considered a wet ESP and a fabric filter baghouse as control technologies. The analysis should of included other options to reduce PM2.5 emission such as an “Advanced Hybrid Particulate Collector” (AHPC) system.

3) The analysis should be more lik e the Highwood Generating Station BACT analysis where they considered va rious types of c ontrol technologies individually and in combination with each other.

4) Test data from the Manitowoc Public Ut ilities facility is achieving a PM10 level of

0.0210 lb/MMBtu as BACT for PM2.5. This limi t is less than half the limit Wolverine is proposing as BACT for PM2.5.

Response: MDEQ disagrees with the above comments.

The additional information Wolverine subm itted on July 27, 2009 gives a thorough explanation of the filterable and condensable portions of the PM 2.5 emission rate proposed

from the CFB boilers. Since reliable emissions information on PM2.5 is still limited, it is

difficult to determine what the removal e fficiency will be. Although some vendors have provided estimates, it is still not known how reliable the data is. Therefore, Wolverine took a conservative approach in which they assumed that approximately 80% of filterable PM10 (or 0.008 lb/MMBtu) best represented the expect ed filterable PM2.5 emissions. For the condensable portion of PM2.5, Wolverine assumed that it would be equally proportional to

PM10 condensable emissions (or 0.016 lb/MMBtu).

Wolverine considered many c ontrol technologies in their BACT review, as the record

demonstrates. The commenter listed several te chnologies related to ESP technologies that have not been demonstrated in practice. (Table 1 in the July 27, 2009 submittal discusses where the various technologies can be found in the record.) MDEQ recognizes the technologies listed by the commenter. Howeve r, these technologies were deemed to be

infeasible since it is not clear what effect (those technologies) would have on acid gases and mercury. WESP, ESP, fabric filter baghouse wi th membrane bags, and f abric filter baghouse with felted polyphenylene sulfide (PPS) bags were ev aluated as the top contro ls for PM2.5.

The commenter references the Otter Tail Power’ s Big Stone plant in South Dakota where the AHPC system was used for a retrofit project. That AHPC system failed and was replaced with a pulse jet baghouse.

### Wolverine Power Supply Cooperative, Inc. Response to Comments Document Page 82 of 140 June 29, 2011

Wolverine did evaluate particulat e control technologies in combi nation with other particulate control devices, as did the Highwood Generating Fa cility. The record reflects a cost analysis, done by Wolverine, in series fo r a polishing scrubber, baghouse, and wet ESP.

After an iteration of such an an alysis, it was found that as t he additional control technologies

are added to the series and the removal effi ciency approaches zero, the cost is beyond economical. Also note, the Hi ghwood analysis, determined that the source would install a FGD (polishing scrubber) followed by a fabric filter baghouse for BACT of PM2.5 but does

not establish a BACT emission limit.

The Manitowoc Public Utilities CFB boiler has a limit of 0.03 lb/MMBtu for total particulate. Stack test results for one day, while firing c oal only, demonstrated the following emission rates: PM total = 0.0120, PM condensable = 0.0092, and calculated PM Filterable = (0.012 – 0.0092) = 0.0028. The stack test data does not demonstrate that t here was a Method 202 for PM filterable done. AQD disagrees that th is one stack test for PM should be used as a basis for setting a limit for PM2.5. The stack test was done for PM total and PM condensables, only. There was no test done fo r PM2.5, and therefore the MDEQ believes that setting a limit based onl y on PM condensable does not provide enough supporting data

to demonstrate such a limit would be achievable.

5. PM10

Comment: First, the limit on PM10 fails to include condensable particulate matter. A BACT limit on PM must include the condensable portion. While MDEQ claims the PM10 limit includes both filterable and condensable PM, the limit is not accompanied by any testing requirements that include the condensable portion. Rather, complianc e with the limit is determined only by

stack test. The PM10 BACT limit must be based on a test method like Method 202 that includes the condensable portion.

Response: Particulate matter (PM) is defined by MDEQ , Air Pollution Control Rule 336.1116(c), “Particulate matter” means any air contaminant existing as a finely divided liquid or solid, other than uncombined water, as measured by a reference test specifi ed in R 336.2004(5) or by an equivalent or alternative method. Th is means that determinations of particulate emission rates for stationary sources shall be conducted as specif ied in the following reference test methods: 5, 5B, 5C, 5D, 5E, or an acceptable alternative method. Acceptable

test methods measure filterabl e particulate emissions.

PM10 is defined by MDEQ, Air Pollution C ontrol Rule 336.1116(k), "PM10" means particulate matter that has an aerodynamic di ameter less than or equal to a nominal 10 micrometers, as measured by a reference test specified in 40 C.F.R. Part 51, Appendix M. The reference test methods include 201 (filter able) and 202 (condensable). Acceptable test methods measure filterable particulate and c ondensable particulate to determine PM10

emissions.

Both PM and PM10 are required to be measured to show compliance with the emission limits in the permit. In order to establish uniform requirements to help ensure proper test methods and procedures are used for the compliance dem onstration, a complete test plan is required to be submitted to the appropriate AQD district office and the Technical Programs Unit in

### Wolverine Power Supply Cooperative, Inc. Response to Comments Document Page 83 of 140 June 29, 2011

Lansing, at least 60 days prior to the scheduled test date. A comp lete submittal will minimize the possibility of a test rejection as a result of improper sampling or data collection methods. Testing shall be performed in strict accordan ce with the procedur es specified in 40 CFR Part 60 (Standards of Performance fo r New Stationary Sour ces, Appendix A, as amended), Part 61 (NESHAP, Appendix B), and Part 51 (Requirements for Preparation, Adoption, and Submittal of Implementation Plans, Appendix M); and the MDEQ Rules, Part 10, Intermittent Testing and Sampling. An y variations in the sa mpling or analytical procedures must be described in the test plan and receive approval from the AQD prior to testing. If state or federal te st methods are not available for th e pollutants of concern, or the

nature of the test site makes it impractical to use them, ot her methods may be proposed as

necessary.

Comment: The Draft Permit proposes as BACT for PM and PM 10, through the use of a fabric filter, the following emission limits: 0.010 lb/MMBtu for PM and 0.026 lb/MMBtu for PM10. This is not

BACT for the PM.

BACT is 0.0088 lb/MMBtu for total PM emissi ons. Pennsylvania issued a PSD permit in April 1995 to the Northampton Generating Company with a total PM10 limit of 0.0088 lb/MMBtu. This facility burns anthr acite culm in a 1,146 MMBtu/hr circulating fluidized bed boiler. Compliance testing in F ebruary 2001 reported total PM10 emissions of 0.0045 lb/MMBtu. The permit limit and the co mpliance tests for Northampton have been rejected by other permitting agencies in the pas t due to those agencies’ confusion as to whether the 0.0088 lb/MMBtu Northampton pe rmit limit includes condensable PM. The confusion appears to stem from the fact that the Northampt on permit requires testing by “Method 5.” USEPA Method 5 tests only for filt erable particulate matter. However, the “Method 5” referred to in the Pennsylvani a DEQ Permit for Northampton refers to Pennsylvania Method 5, which includes both front half and some condensable (backhalf) emissions (i.e., both filterable and condens able PM). The Pennsylvania permit and compliance tests for Northampton included conden sable fraction PM in the backhalf of the

control train.

A test at the JEA facility, conducted by Bla ck & Veatch for the Department of Energy,

measured filterable PM emissions of 0.004 lb/MMBtu. This is significantly lower than the proposed 0.010 lb/MMBtu for PM and 0.026 lb/MMBtu for PM10.

Response: MDEQ disagrees with the commenter. MDEQ reviewed Wolverine’s BACT analysis and

determined that BACT for the CFB boilers was 0.010 lb/MMBtu for PM, 0.026 lb/MMBtu and 78.8 pph for PM10.

The stack test for Northam pton Generating Company was reviewed by the MDEQ-AQD Technical Programs Unit, and determined to be incorrect for measurement of PM10 emissions. Instead of drying and weighing the impingers to get back half condensable PM, they filtered the impinger liquid and only dried and weighed the filter. The majority of the condensable PM would be dissolved in the impi nger liquid and run through the filter. Northampton did not find any c ondensable PM when testing t he anthracite coal boiler and the reported total PM10 emissions of 0.0045 lb/MMB tu is bias low. This test data does not support setting a limit for PM10 that is lowe r than proposed since the test method did not measure condensables appropriately.

### Wolverine Power Supply Cooperative, Inc. Response to Comments Document Page 84 of 140 June 29, 2011

PM emission tests for the JEA facility have vari ed up to as high as 0.0091 lb/MMBtu filterable PM in November 2002, while burning 75% petro leum coke and 25% coal (a blend very close to that identified by Wolveri ne as its “design fuel”). JEA Northside has demonstrated lower particulate emission rates under a variety of operating conditions. It has also demonstrated

that a limit of 0.004 lb/MMBtu can not be achieved continuous ly using the same monitoring methods that Wolverine will be using. The proposed PM BACT limit of 0.010 lb/MMBtu contains an acceptable factor of safety that would assure c ontinuous compliance.

Comment:

The PM limit is not BACT bec ause compliance is not measur ed by a continuous emission monitoring system for PM (“PM CEMS”). The me thod of determining comp liance is a critical part of a permit limit, which impacts the stringency of the limit. Here, the Draft Permit requires that compliance with the PM/PM10 limit be dem onstrated by stack testing and continuous opacity monitoring. The permit for Spurlock Un it 4 requires that PM CEMs be used to demonstrate compliance with the PM (filterabl e) BACT limit. The record contains no information showing why PM CEMs cannot be used to dem onstrate compliance at the Proposed Coal Plant.

Response: Currently, a PM CEMS is not required by any federal or state regulation. Wolverine has proposed to demonstrate complianc e with the PM BACT limit through periodic stack testing, and a continuous opacity monitori ng system (COMS). A COMS indicates the presence of particulate matter, and will provide an indicati on of continuous satisfac tory operation of the boilers when an opacity of less than 10 percent is met. A COMS is also allowed as a compliance provision per 40 C.F.R. 60, Subpart Da to monitor the performance of a fabric filter operated to comply with the applicable PM emission limit. A COMS is an acceptable monitoring system on a PSD permit.

6. NOx

Comment : The MDEQ notes that SCR c an control NOx emissions by 80-90% efficiency. This underestimates the efficiency. Recent SCRs, designed for hi gh-dust (located upstream of the particulate control device) coal boiler ap plications routinely ac hieve greater than 90%

NOx reduction.

Response: MDEQ agrees that SCRs, can likely reach effici encies greater than 90% for NOx reduction. However, maintaining that effici ency is not usually practical from a cost standpoint. Also, the MDEQ is not aware of any CFB boilers with SCR control that hav e demonstrated greater than 90% and the commenter did not give any examples of such sources.

Comment : Due to numerous errors in assessing select ive catalytic reduction (“SCR”) and selective non-catalytic reduction (“SNCR”), MDEQ failed to base BACT on the top control technology. In conducting its BACT analysis, Wolverine ev aluated several NOx control approaches, as
summarized in the MDEQ Fact Sheet. Thes e included staged combustion techniques, flue

### Wolverine Power Supply Cooperative, Inc. Response to Comments Document Page 85 of 140 June 29, 2011

gas recirculation, SCONOxTM, gas reburn , SNCR and SCR. The discussion of SCR is deficient and the rejection of SC R is without basis: the analysis of the technical feasibility of upstream SCR is flawed, while the analysis of t he economic feasibility of downstream SCR contains improper data and assumptions. Fi nally, the control technology—SNCR—and NOx

limit selected is not BACT.

MDEQ erred in dismissing the technical feasibilit y of upstream SCR in a “high dust” setting. In addition, MDEQ made the statement t hat SCRs have not been demonstrated to be technically feasible on CFB boilers, and Wolver ine’s assertion that SCR has “never been installed on a CFB boiler in a high dust lo cation”, are both inapplicable to the BACT discussion and patently untrue.

Response: Using the top-down BACT approach per EPA’s DRAFT New Source Review Workshop Manual (October 1990), SCR was identified as the top control option for NOx. However, the BACT analysis takes into account energy, env ironmental, and economic impacts and other costs to determine if the maximum degree of reduction is achievable for a source. The technical feasibility and the cost of an SCR fo r a CFB boiler was thoroughly investigated.

Documents published by EPA, EPA/452/B-02-0 01 and EPA-452/F-03-032, do support the claim that using SCRs in high dus t locations will result in fouli ng of the catalyst. Therefore,
MDEQ did find that the location of a SCR in hi gh dust locations to be technically infeasible.

MDEQ believes the use of SNCR is BACT for NOx and was determined using the top-down BACT approach. As determined in the Sierra Club vs. Western Greenbrier Co-Generation, LLC, (Appeal # 06-03-AQS) the permittee was not required to innovate or to push technology beyond what is available and applicable. EPA’s DRAFT New Source Review Workshop Manual (October 1990), page B.18, states that in determining the technical feasibility of "available" control technologies:

“[a] source would not be required to ex perience extended time delays or resource penalties to allow research to be conduct ed on a new technique. Neither is it expected that an applicant w ould be required to experience extended trials to learn how to apply a technology on a totally new or dissimilar source type."

Wolverine initially submitted SNCR with tail- end cold-side (located after PM and sulfur removal equipment) SCR, however they excluded SCR saying it was not feasible. The AQD disagreed and asked Wolverine for an additi onal analysis based on tail-end SCR without SNCR, in December 2007. Wolverine provi ded supplemental informat ion supporting tail-end

SCR as not cost effective. The cost effe ctiveness of this control technology was approximately $20,100 per ton (for both boilers uncontroll ed emissions), which was considered cost prohibitive. An SCR located after other control equipment requires the flue gas to be reheated for proper operation and NO x removal efficiency which increases the

costs associated with this option.

Comment : Operation of SCR also will result in reductions in dioxins. T he Proposed Coal Plant is subject

to MACT for dioxins. The current MACT limits fail to control dioxins adequately. An SCR is one technology that can be used to establish mo re appropriate MACT limits. Therefore, the

### Wolverine Power Supply Cooperative, Inc. Response to Comments Document Page 86 of 140 June 29, 2011

cost effectiveness of SCR must be credited with reduction of dioxins, a result not seen with

SNCR.

Response: This source is not subject to MACT limits. The proposed proj ect is subject to 112(g), which effectively evaluated all Hazardous Air Pollutants (HAP).

Comment : The control technology a nalysis of SNCR is faulty. MDEQ cited permits that have to meet

limits at all load condition s, unlike Wolverine.

MDEQ ‘s analysis of other facilities NOx emissions is disingenuous. They noted several

facilities that had NOx emissions of 0.07 lb/ MMBtu, the MDEQ does not include that these permits require the limit to be met at all load ranges.

There are several other existing coal fired CF B boilers that have NOx limits lower than 0.07 lb/MMBtu, such as BMC Thomas Oil facility, Cogeneration National Co rporation facility and Corn Products facility. A top-down BACT analysis must assume that the proposed

Wolverine CFB boilers can achieve this same level of control.

In addition, limits representing LAER are presumptively appropriate BACT limits. Specifically, NOx LAER limits in other states show t hat 0.033 lb/MMBtu (24-hr average) is an

achievable limit. Unless the LAER level of contro l can be rejected as not technically feasible, not cost effective, or due to unusual collateral impacts at the permitted site, LAER must be

established as BACT. LAER for NO x control from the proposed CF B boilers is at least as low as 0.033 lb/MMBtu over a 24-hour averaging per iod, which is required by the Dallas-Forth Worth State Implem entation Plan for coal-fired boilers.

Moreover, BACT analyses cannot be restrict ed to existing limits. Instead, BACT must represent the best achievable co ntrol, which includes the cont rol achieved by unit operating well below their respective limit s. A number of coal fired CF B boilers are achieving lower

NOx emission rates than the 0.07 lb/MMBtu lim it proposed in the Draft Permit, even with periods of startup and shutdow n included (from data taken in 2003). Because these similar units already achieve a lower NOx emissi on rate—0.043 lb/MMBtu and lower—BACT is

assumed to be at least as low as 0.043 lb/MMBtu.

Wolverine rejected the use of SCR achieving 75% control in the “tailend” configuration based on an estimated cost effectiveness of $20,100 per ton reduced. The cost recently estimated by the Wisconsin Department of Natural Reso urces when determining the cost effectiveness of a tail-end SCR on a 300 MW coal, petroleum coke and biomass fired boiler that is essentially the identical boiler to the two proposed for Wolverine was $10,647. In addition to Wolverine and MDEQ’s failure to justify the ex traordinarily high cost estimates for an SCR, MDEQ also prejudiced the cost-effectiveness analysis.

Response: In the permits cited by MDEQ, the EKPC Spur lock Unit 3 and 4, does require the limit to be met under all load conditions, however, the permit also has an optimizati onal period, which if they can not meet 0.07 lb/MMBtu within the 18 month period, they can adjust the limit upward as much as 0.10 lb/MMBtu. However, the second permit cited by MDEQ, Southern Montana Highwood Station permit has the following emission limits for NOx:

### Wolverine Power Supply Cooperative, Inc. Response to Comments Document Page 87 of 140 June 29, 2011

Except during periods of st art-up and shutdown, NOx emi ssions from the CFB boiler stack shall not exceed the following: a. 0.10 lb/MMBtu based on a 1-hour average b. 0.09 lb/MMBtu based on a 24-hour average and c. 0.07 lb/MMBtu based on a rolling 30-day average

Since the intermediate loads hav e been removed from the Wolver ine permit (see “Section II. Summary of Comments Resulting In Changes to the Permit”, of this document) Wolverine will be required to meet the NOx emission limit of 0.07 lb /MMBtu, based on a 30 day rolling average, at all loads. This limit is the sa me or lower than the plants listed above.

In the June 2009 additional information s ubmittal, the applicant provides CEMs data measured from 3 similar operating power plants . This information supports 0.07 lb/MMBtu

with a SNCR for NOx control as BACT for the proposed Wolverine boilers. The data was

obtained from AES Warrior Run Unit 1 (bituminous coal-fired unit), Schiller Unit 3 (wood-fired unit), and JEA Northside Units 1A and 2A (petcoke-fired units).

Wolverine is not subject to LAER. As stated above, the record supports 0.07 lb/MMBtu with

a SNCR for NOx control as BACT.

The Commenter also lists several power plan ts, including some of those that Wolverine provided information on, that the commenter st ates are achieving lower NOx emission rates than 0.07 lb/MMBtu. Although this may be tr ue at one instantaneous point in time, the data

shown in the comment is for the lowest emission rate achieved one time; it does not consider

the standard deviation of the dat a. The standard deviation w ould demonstrate that those power plants are not continuously achieving the lowest rate possible all the time.

Lastly, the commenter refers to the cost recently estimated by the Wisconsin Department of Natural Resources for the Nelson Dewey plant expansion which was for one 300 MW CFB boiler. The cost of 20,100 per ton reduced es timated by Wolverine was for two 300 MW CFB boilers. Therefore, the cost for each boile r controlled by a tail-end SCR would be $10,050 per ton reduced, which is less than t hat cost rejected by Wisconsin.

7. SO2

Comment : MDEQ does not propose limits reflecting the maximum degree of reduction as shown by permits issued to and/or the per formance of other facilities. As noted by Wolverine and the MDEQ itself, the AES Puerto Rico facility in Guayama, Puerto Rico, received a PSD permit for two coal-fired CFB boilers (~225 MW/each) that contains the fo llowing SO2 BACT limits applicable to each CFB boiler: • 9 ppmdv @ 9% oxygen; • 0.022 lb/MMBtu; or • 54.1 lb/hour, whichever is mo re stringent on a three hour basis. These limits are lower than the proposed BACT limi t for Wolverine. Furthe rmore, this facility

was tested in October 2002. Unit 1 achieved 0.00037 lb/MMBtu SO2 emissions. Unit 2

achieved 0.0013 lb/MMBtu SO2 emission.

### Wolverine Power Supply Cooperative, Inc. Response to Comments Document Page 88 of 140 June 29, 2011

Similarly, the NEVCO-Sevier facility received a PSD permit for a 270 MW coal-fired CFB

boiler with a BACT limit for SO2 of 0.05 lb/MMB tu over 24 hours and 0.022 lb/MMBtu on a 30 day rolling average. These lim its include periods of startup, shutdown and malfunction.

Other coal-fired CFB boiler facilit ies in California have also received BACT limits much lower

than 0.05 lb/MMBtu for SO2: • Pyropower Corp. received a SO2 limit of 0.039 lb/MMBtu for a 49.9 MW coal fired

CFB boiler in 1986 • BMCP (Thomas Oil) received an SO2 limit of 0.039 lb/MMBtu (96% control) for a

coal fired CFB boiler in 1986 • Cogeneration National Corp. received an SO2 limit of 95% control for two coal fired

CFB boilers in 1985 However, MDEQ fails to mention these permits at all, let alone explain why they can be rejected as a basis for BACT at the Proposed Coal Plant. Nothing in the permit record suggests any reason why the WCEV cannot achieve at leas t 0.022 lb SO2/MMBtu on a 24 hour average, which is the lim it for AES Puerto Rico. In fact, nothing indicates why the WCEV cannot achieve 0.0013 lb SO2/MMBtu, whic h AES Puerto Rico achieved in practice. Therefore, BACT for SO2 emissions from the Proposed Coal Plant is 0.0013 lb/MMBtu, or

lower.

Additionally, the JEA Northside facility in Florida conducted an emission test in summer 2002, while firing high sulfur coal in its 300 MW CFB boilers, and achieved 0.0-0.04 lb/MMBtu SO2 emissions. Northside uses a sp ray dry absorber (dry FGD), similar to the proposal at WCEV. The design specifications required 85% removal of SO2 in the CFB boiler, and another 89.5% SO2 removal in the dry FGD. While this is not as low as the AES Puerto Rico emission rates, it is signific antly lower than the limit s proposed for the WCEV.

This further demonstrates t hat the proposed permits are t oo high to constitute BACT.

Response: There were many facilities with CFB coal-fir ed boilers reviewed. Ho wever, during the BACT review, facilities that best repr esented Wolverine were used to es tablish BACT. The criteria used was similarity in the unit characteristics, primary and secondary fuels, permit limit, type of pollution control equipment and the level of emissions emitted from the operating plant.

The commenter listed several facilities that Wo lverine did not menti on: Pyropower Corp, BMCP, and Cogeneration National Corp. Those CFB boilers were less than 50 MW which is not a comparable size unit. Also mentioned by the commenter was the Nevco Sevier Power Company which is comparable in size. Howeve r, this plant was prop osed with the use of low sulfur coal and did not have any stack test data results. The last facility mentioned was the AES Puerto Rico facility wh ich uses coal and petcoke with a maximum of 1% sulfur content. Stack test results provided by the commenter, demonstrated lowest emission rate achieved one time; it does not consider the standard deviation of the data and should not be

used to set the BACT emission limit. AES Puerto Rico CEMS data demonstrated an

exceedence of the 0.022 lb/MMBtu BACT limit.

MDEQ agrees with Wolverine that the best representative facilitie s are JEA Northside, Florida and Reliant Energy Seward Power Plant, P ennsylvania. These fac ilities are similar in all characteristics to the proposed Wolverine fac ility. Additionally, the CEMs data collected in

2007 and 2008 was used to demonstrate that 0. 06 lb/MMBtu is BACT for the proposed CFB

boilers at Wolverine.

### Wolverine Power Supply Cooperative, Inc. Response to Comments Document Page 89 of 140 June 29, 2011

*June 22, 2009 submittal : Wolverine submitted addition al information (which AECOM collected and processed) that included two year s of hourly CEMs data (2007 & 2008) from the Reliant Energy Seward Plant and JEA Northside for comparison to the WCEV units proposed. Based on that data it was concluded that the Se ward Plant achieves about 93%

overall SO2 control and JEA Nort hside achieves about 97% overall SO2 control. Compared to WCEV with a proposed SO2 limit of 0.05 lb/ MMBtu the overall contro l efficiency should be greater than 98%.

The following calculation if provided to demonstrate how the control efficiencies were

derived: Petcoke/PRB Blend = 2.97lb/MMBtu (from applic ation submittal Appendix 2, Table 4.2) CFB 80%: 2.97 lb/MMBtu x (1-0.80) = 0. 5940 lb/MMBtu (SO2 coming out of CFB) Scrubber 91.5%: 0.5960 lb/MMBtu x (1-0.9 15) = 0.050 lb/MMBtu (12 month averaging period) Overall (CFB + scrubber): 2.97 lb/M MBtu x (1-0.98) = 0.0594 lb/MMBtu

Comment : There should be a percent reduction or separ ate BACT limits for each type of fuel that Wolverine plans to burn. If not, the facility could use lower sulfur petroleum coke or PRB coal, or other coals with lower sulfur and operate their SO2 contro ls at lower control

efficiencies than established as BACT.

Response: The MDEQ ranked by control effi ciency the feasible control alte rnatives for sulfur dioxide emissions pursuant to the Cl ean Air Act, Part 55 and EPA guidance. Site-specific and process-specific variables such as the sulfur content of the f uel were taken into account.

When the concentration of SO 2 in the flue gases entering th e polishing dry scrubber is high (from burning fuel with a high sulfur content), the control e fficiency of the polishing dry scrubber is higher than when the SO 2 concentration is lower. The SO 2 emission limit is dependent on both the sulfur cont ent of the fuel and the contro l efficiency of the polishing dry

scrubber.

Similarly, the clean fuels and control effect iveness components of a BACT analysis are closely linked. The commenter asserts that BACT requires the use of cleaner fuels for SO 2 (in the form of lower sulfu r-content coal), and that BACT (a t JEA Northside) requires 85% removal of SO2 in the CFB boiler, and another 89.5% SO2 removal in the dry FGD.

For the maximum sulfur content in the fuel proposed, a great er than 98% control efficiency overall (80% from the CFB boiler and 91.5% from the polishing scrubber) is necessary to meet the emission limit 0.05 lb/MMBtu annually . MDEQ agrees that the emission limit may be met through use of a lower sulfur content fuel than the maximum design value, and as a practical matter, the actual f uel used will not alwa ys contain the maximum allowable sulfur

content. As can be seen in the analysis of the examples cited by the commenter (presented below), a 99% control efficiency is achieved at power plants bur ning high sulfur content fuel. The same level of control efficiency is not ac hievable when the concentra tion of the pollutant in the flue gases enteri ng the scrubber is lower.

Also, BACT for SO 2 is an emission limit, based on control e fficiency, which is applicable at all times. The MDEQ correctly determined that the dry polishing scrubber can consistently achieve 98% control efficiency at an inlet concentration of 2.97 lb SO 2 /MMBtu and that an

### Wolverine Power Supply Cooperative, Inc. Response to Comments Document Page 90 of 140 June 29, 2011

SO 2 emission limit of 0.05 lb/MMBtu annually (0.06 lb/MMBtu 30-day rolling average) is

BACT.

Comment : Rejection of wet flue gas desulfurization (WFGD) was improper due to inappropriate technical and unsupported economic assumptions in the BACT determination. The MDEQ provided the following analysis to justify its re fusal to require wet Flue Gas Desulfurization scrubber technology (wet FGD):

“No known WFGD systems have been insta lled or demonstrated in practice

downstream of a CFB boiler. Their percent removal efficiency can range anywhere from 52 to 98% and have high capital and operating co sts because of the la rge consumption of water. This control option is frequently used on pulverized coal boilers, and involves the use of a spray absorber tower to contact the flue ga s with water/lime slurry sprayed from the top of the tower. Although this control tec hnology has not been used with a CFB boiler, Wolverine considered it technically feas ible and included an economic evaluation for application with the proposed CFB boilers. This evaluation yields a cost of $11,000 per ton of SO2 controlled. Wet flue gas desulfurization is not an econom ically viable control option.”

MDEQ must clarify whether it accepted Wolv erine’s position that WFGD is technically feasible. Assuming that the above quote means that MDEQ rejected WFGD on economic grounds only, we include comments on technical issues as well, both because these issues impact the cost effectiveness outcome and to correct errors and misconceptions in the

record.

Response: Even though MDEQ could not find a CFB boiler wi th a WFGD system that has been installed or demonstrated in practice, the MDEQ believed it could be feasible. T herefore, a top-down BACT analysis was performed including WFGD.

Comment : MDEQ erred in citing 80-90% control from WFGD, as wet FGDs can, by themselves, achieve, and have achieved, equal to or greater than 99% removal of SO2.

Response: MDEQ cited 52 to 98% as the removal efficiency for a WFGD. The range includes all scrubbers, wet and dry. This range was taken from the Air Pollution Control Technology Fact Sheet, document EPA-452/F-03-034. Also stated in that document, the highest removal efficiencies are achieved by wet scrubbers, gr eater than 90%, and dry scrubbers, typically less than 80%. Although, newer technology of dry scrubber designs are capable of 90% or

more control efficiencies. Based on data t hat Wolverine provided on June 22, 2009 for additional BACT information, Seward and J EA Northside units ac hieved SO2 control efficiencies of 93% and 97%, re spectively, using dry FGD.

Comment: MDEQ accepted the Applicant’s economic f easibility argument, thereby failing to include specific information on the WFGD design or designs being considered and relying on unsupported assertions provided by the Applicant. Nor did MDEQ explain its rejection of

### Wolverine Power Supply Cooperative, Inc. Response to Comments Document Page 91 of 140 June 29, 2011

WFGD as economically unjustifi ed based on a cost per ton fi gure of $11,000. These errors

undermine the economic feasibility analysis.

As an initial matter, there are many differe nt types of WFGD, as opposed to DAQ’s misleading description of it as c onsisting of “...a spray absorber tower...” Costs (both capital and operating), as well as operating efficienc ies can differ between the various designs. Since WFGD was correctly deemed to be tech nically feasible, various designs of WFGD should have been considered with regards to co st before they were rejected. MDEQ also accepted Wolverine’s cost analysis of WFGD, which concluded that it would cost $11,000 per ton of SO2 controlled. T he cost analysis did not contai n vendor design and related cost. It relied on numerous assumptions that could not be verified and that do not appear to be supported. Since it did not consider a proper (i.e., 99%) re moval efficiency, the cost analysis

underestimated the tons of SO2 removal, thereby providing an erroneously high value of the cost-effectiveness. For example, simply by considering a 99% removal efficiency as opposed to 98%, and keeping all other assumptions t he same, the cost effectiveness should have been $5,500 per ton of SO2 removed, which is well within the acceptable range for

costeffectiveness.

Further, it is not clear why the $11,000 per to n of cost-effectiveness that was calculated by

Wolverine should not be deemed to be cost-effectiv e. It is Wolverine’s obligation to show that this cost is not “cost-effective” compared to the cost of controlling SO2 elsewhere. “The top-down approach places the burden of proof on the applicant to justify why the proposed source is unable to apply the best technology available.”

Additionally, MDEQ must state for the record wh at the cut-off for cost-effectiveness is and why. Without this support, DAQ’s rejection is arbitrary and the limit is not BACT. The basis for a BACT determination must always be set forth in the public record.

Response: MDEQ disagrees with this comment. First, Wo lverine did use a contro l efficiency of 99% in the cost analysis for the WFGD system. Se cond, two similar sources, Southern Montana Electric Generating (Highwood Stat ion) and Virginia City Hybrid Energy Center both did cost analysis for a WFGD system and the following was determined: Highwood Station cost equaled $27,365/ton SO2 controlled which did incl ude the cost of water; and Hybrid Energy Center cost equaled $8,100/ton SO2 controlled (d id not include cost of water), both were considered too costly. Ba sed on that information MDEQ determined that $11,000/ton SO2 controlled was also too costly.

Comment: Putting aside the improper rejection of WFGD , MDEQ also erred by failing to require submission of any specific information as to the polishing scrubber technology that Wolverine is proposing to use. This omission is im proper; indeed, it abdicates the DAQ’s core responsibility to specify the “technology that is ...the most economical and cost effective” as the basis of its BACT limit. Different polis hing scrubbers can achieve different levels of control. It is not possible to divorce the SO2 control efficienc y from the technology that will provide for SO2 reduction. Reques ting this flexibility simply m eans that Wolverine wants to achieve a target, predetermined SO2 emissions level which was not arrived at based on what the best technology can achieve. The omission of info rmation regarding the polishing scrubber technology proves that the top-down BACT analysis process was not properly

followed.

### Wolverine Power Supply Cooperative, Inc. Response to Comments Document Page 92 of 140 June 29, 2011

Response: MDEQ disagrees with the commenter. As st ated above, MDEQ is aware that different polishing scrubbers can achieve different levels of control. In determining BACT (an emission limit) for SO2 Wolverine used an aggr essive yet achievable control efficiency of 98% overall (CFB boiler and dry polishing scrubbe r) to calculate the SO2 controlled emission rate. As compared to Seward and JEA Norths ide, these units have achieved SO2 control efficiencies of 93% and 97%, respectively, usi ng a dry polishing scrubber. Therefore, MDEQ

believes that the SO2 emissions level was based on what the best technology can achieve.

The following calculation if provided to demonstrate the contro l efficiencies used: 

### Petcoke/PRB Blend = 2.97lb/MMBtu (from application submittal Appendix 2, Tables 4.2) CFB 80% : 2.97 lb/MMBtu (1-0.80) = 0.5940 lb/MMBtu (SO2 coming out of CFB) Scrubber 91.5%: 0.5960 lb/MMBtu (1-0.915) = 0.050 lb/MMBtu (12 month averaging period) Overall (CFB + scrubber): 2.97 lb/MMBtu (1-0.98) = 0.0594 lb/MMBtu

Comment: In addition to the improper rejection of wet FGD, Wolverine did not properly analyze other technologies for SO2 removal. For example, 90% removal across the a dry scrubber was

evaluated as BACT in the South Heart Power Plant permit application, with an inlet SO2 concentration to the spray dry absorber of 0.392 lb/MMBtu. In the Gascoyne 175 MW permit application, the applicant assumed that the sp ray dry absorber would remove 89.1% of the

SO2 emissions with an inlet SO2 emission rate of 0.348 lb/MMBtu. There is ample indication in PSD permit applications that spray dry absorbers can achi eve at least 90% SO2 removal

even with low sulfur coals. Indeed, as found by EPA in it s review of the New Source

Performance Standards for coal-f ired electric utility boilers , a spray dryer/absorber can generally achieve greater than 90% SO2 remo val. Wolverine should, at a minimum, accordingly, evaluate an SO2 BACT limit that reflects at least 90% SO2 removal across the spray dry absorber. Coupled with a 90% removal in the boiler, for an inlet SO2 level of 3.0 lb/MMBtu, the outlet emission limit would be 0.03 lb/MMBtu. This limit would be lower still at

lower inlet SO2 levels. Wolverine also fa iled to evaluate the maximum degree of SO2 reduction achievable with other technologies , such as circulating dry scrubbers. For example, the Mustang Power Company plans to use a circulating dry scrubber at its proposed New Mexico power plant, and it has indicated SO2 removal of 97% can be achieved. The applicant must evaluate the maximum degree of SO2 emission reduction that

can be achieved across a ci rculating dry scrubber in its SO2 BACT analysis.

Response:

Wolverine did evaluate the emission bas ed on the maximum degree of SO2 reduction achievable from the inherent scrubbing of t he CFB boiler furnace and the dry polishing scrubber. Again, as stated above, the following calculations are provided to demonstrate

how the emission limits were derived:

Petcoke/PRB Blend = 2.97lb/MMBtu (from applic ation submittal Appendix 2, Tables 4.2) CFB 80%: 2.97 lb/MMBtu (1-0.80) = 0. 5940 lb/MMBtu (SO2 coming out of CFB) Scrubber 91.5%: 0.5960 lb/MMBtu (1-0.915) = 0. 050 lb/MMBtu (12 month averaging period) Overall (CFB + scrubber): 2.97 lb /MMBtu (1-0.98) = 0.06 lb/MMBtu

### Wolverine Power Supply Cooperative, Inc. Response to Comments Document Page 93 of 140 June 29, 2011

8. 

### CO/VOC

Comment : The permit fails to include the requirement fo r good combustion control as part of BACT for CO and VOC while concluding that good combus tion control is BACT. Good combustion control is the BACT limit that Wolverine sug gests for CO and VOC, and the method that MDEQ acknowledges for CO (although never incl udes in the permit). The permit ultimately does not incorporate or require good combus tion control as a permit operating or other requirement. Identifying good combustion control as BACT, and then not including, it violates BACT requirements.

Response: The permit does require good com bustion control, and it is incor porated in the emission limits

for CO and VOC. CO and VOC are formed as a result of incomplete combustion of a hydrocarbon fuel. The permit requires that Wolverine demonstrate good combustion control through continuous monitoring of CO emissions. Continuous m onitoring of CO emissions is used to, among other things, reduce the air to fu el ratio to ensure the maximum combustion of fuel, which in turn ensures compli ance with the CO and VOC emission limits.

Comment : The Draft Permit does not contain a BACT limit for VOC. The VOC BACT limit of 0.003 lb/MMBtu is higher than BACT limits for VOC at other similar sources. Provide justification why a limit of 0.0024 (both S antee Cooper, South Carolina and Louisville Gas & Electric Trimble County, Kentucky power plants) cannot be achieved, including an analysis of the energy, environmental, and economic impacts of available control technologies.

Response: The proposed limit of 0.003 lb/MMBtu coul d have been explained better. VOC emissions

from combustion sources are related to the or ganic content of the f uels combusted and good combustion practices. VOC em issions are not controlled by an add-on control device and can fluctuate widely, ther efore making it difficult to asse ss an emission limit. Typically, the organic content of subbituminous coal is higher than bitumino us coal, and petroleum coke has a lower organic content than coal. The hi ghest organic content fuel that Wolverine is proposing to combust is the biomass. Data is limited for VOC emissions from all of the fuels that Wolverine is proposing to combust. De cisions on the VOC emissi on limit for Wolverine were mainly based on the performance of JEA Northside which combus ts bituminous coal and petroleum coke, two of the lower organic c ontent fuels. The tw o CFB boilers at JEA

Northside had measured VOC emissions of approximately 0.0014 lb/MMBtu when combusting a blend of 90% petroleum coke/10 % coal. This emission rate was higher than

the VOC emission rate of 0.00025 lb/MMBtu measured when combusting a blend of 70% petroleum coke/30 % coal. The blend of 70% petroleum coke/30 % c oal should contain a higher organic content, and in theory result in higher VOC emissions. In contrast, when combusting 100% coal, unit #1 had VOC emissions of 0.0023 lb/MMBtu measured at 104% of allowed process rate and unit #2 had VO C emissions of 0.000016 lb /MMBtu measured at 92% of allowed process rate. Since VOC em issions were unpredictable and based on lower organic content fuels, a cons ervative 0.003 lb/MMBtu was assessed for the VOC emission limit which represents a 30% factor of safety over JEA Northside’s highest VOC test while combusting coal.

### Wolverine Power Supply Cooperative, Inc. Response to Comments Document Page 94 of 140 June 29, 2011

The limit of 0.0024 lb/MMBtu (both Santee Cooper, South Carolina and Louisville Gas & Electric Trimble County, Kentucky power plants) can be achieved when combusting bituminous coal. Santee Cooper Cross, Sout h Carolina combusts similar fuels to JEA Northside. Santee Cooper Cr oss has demonstrated compliance with the VOC limit of 0.0024 lb/MMBtu, but the MDEQ had more extensive emission data for JEA Northside from 2002 to 2008. The performance of JEA Northside indi cates that the VOC emission limit of 0.003

lb/MMBtu is conservative wi thout being too generous. Louisville Gas & Electric, Trimble County has not been built yet so no further ev aluation was completed on this unit.

A complete analysis of the energy, environm ental, and economic impacts of available VOC control technologies did not have to be performed per the top-down BACT process. Wolverine evaluated two options for VOC cont rol: oxidation catalyst and good combustion control. The oxidation catalyst was found to be no t technically feasible for a coal-fired boiler.

Good combustion control was found to be the most effective control option, and therefore,

selected as BACT.

Comment : The Draft Permit does not contain a BACT limit for CO. The BACT limit of 0.15 lb/MMBtu for CO is higher than BACT limits for CO at other similar sources.

Response: For other similar boilers, CO emission limits of 0.10 lb/MMBtu, 0.11 lb/MMBtu, and up to 0.15

lb/MMBtu were reviewed. CO emissions from boilers are a function of oxygen availability (excess air), flame temperature, residence time , combustion zone design, and turbulence.

CO emissions like VOC emissions are contro lled by good combusti on and can fluctuate widely, therefore making it difficult to assess an emission limit. The CO emission limit of 0.15

lb/MMBtu is conservative without being too generous.

Comment : For CO, the commenter reviewed a large number of permits and stack tests to determine the

lowest carbon monoxide emission rate that has been achieved in practice at a similar source. A quick review indicates that the CFB boilers located at the Cedar Bay facility in Florida routinely achieve a lower carbon monoxide em ission rate than proposed. Fifteen stack tests

conducted between 2003 and 2008 demonstrat e that Cedar Bay achieved a carbon

monoxide emission rate of 0.05 lb/MMBtu bas ed on a 3-hour average. Similarly low CO

levels have been achieved at ot her circulating fluidized bed boilers. These include JEA Northside circulating fluidiz ed bed boiler, where detailed pe rformance tests were conducted for a range of fuels and at loads of from 40% to 100%. The CO limit is no greater than 0.05 lb/MMBtu based on a 3-hour average, the highes t reported CO value over the period 2003 to 2008. This is one-third of the value (0.15 lb/MMBtu) proposed by MDEQ as the BACT fo r CO, notwithstanding the leniency afforded by MDEQ’s longer averaging time (i.e., 30 days).

Response: The monitoring method for the CFB boilers is a CO CEMS. The monitoring method allows averaging over a longer period of time for a potentially lower CO emission limit. The stack testing results listed by the commenter dem onstrate performance for short time frames during stable operation. CO emissions can fluc tuate during load shifts and fuel switching, and since the monitoring will measure conti nuous operation, the em ission limit of 0.15

### Wolverine Power Supply Cooperative, Inc. Response to Comments Document Page 95 of 140 June 29, 2011

lb/MMBtu was assessed to include a factor of sa fety. Continuous compliance with a CO limit no greater than 0.05 lb/MMBtu has not been de monstrated as achievabl e. Likewise, a 3-hour averaging period for CO emissions is not necessary and potentially too restrictive.

Comment : Several proposed emission limits require co mpliance on a 30-day rolling average basis. Several similar permits used for comparison in the permit application contain a 3-hour average or 24-hour rolling average. Explain why a shorter compli ance time is not feasible for

this source.

Response: A shorter compliance time is feasible for th is source. However, the monitoring method

selected for the CFB boilers is a CO CEMS. The monitoring method allows averaging over a longer period of time, and therefore, the select ion of a lower CO emission limit. The longer averaging time allows for averaging of lower emissions with higher emissions over more emission data. Better performance (good comb ustion) can be maximize d, and fluctuations

in CO emissions minimized. A lower CO emi ssion limit means lower CO emissions over the

lifetime of the CFB boilers.

Comment : It has been determined that state-of-the-art co mbustion techniques and proper and efficient combustion practices represent BACT for toxic ai r contaminants. Explain in full what this

means.

Response: Best Available Control Technology for Toxics (T- BACT) refers to any chemical or compound emitted to the air other than criteria pollutant s (CO, VOC, NOx, PM, PM10, PM2.5, Sox, and lead). Toxic air pollution in Michigan is cont rolled under two sets of regulation: (1) state administrative rules and (2) the federal Clean Air Act, as amended. According to Michigan’s

Rules all known substances c an be regulated as toxic air cont aminants (TAC), except some

substances which have been specifically ex cluded because they are regulated elsewhere or are considered relatively non-toxic. MDEQ reviewed the amount of TAC emissions the facility could possibly emit after the best controls are installed. Wolverine is required to limit TAC emissions to amounts at or below screening levels which protect the public health.

State-of-the-art combustion tec hniques; such as oxygen availability (excess air), flame temperature, residence time, combustion zone design, and turbulence; aid in complete

combustion in the CFB boilers which minimize TAC emissions. State- of-the-art combustion techniques have been considered T-BACT to mi nimize TAC emissions on many similar projects.

9. Greenhouse Gases (GHG)

Comment: Circulating Fluidized Bed (CFB ) boilers have a significantly greater greenhouse gas impact than Pulverized Coal (PC) boilers, even when burning biomass. Perhaps most egregiously, not only do CFB boilers emit more NOx and other criteria pollutants than controlled PC boilers and (Intergrated Gasification Combined Cycle) IGCC plants, but CFB boilers pose a very serious additional environmental and heal th concern: CFB boilers emit more

### Wolverine Power Supply Cooperative, Inc. Response to Comments Document Page 96 of 140 June 29, 2011

greenhouse gases than PC boilers on a carbon -equivalent basis. While CFB boilers emit less CO2 than PC boilers, they emit more nitrous oxide than PC boilers. N2O is a potent greenhouse gas, with almost 300 times th e greenhouse gas impact of CO2. Thus, comparatively, supposedl y “clean” CFB boilers emit approx imately 15% more global warming pollutants than PC boilers.

Petroleum coke, a fuel burned in CFB boilers , also increases the amount of greenhouse gases from combustion.

Response: On a lb/MW-hr basis, greenhouse gas emissions from both CFB and PC boilers are very similar. As reported in the (Electric Generat ing Alternative Analysis) EGAA, NOx emissions

and CO2 emissions from a subcritical CFB boile r are superior to subcritical PC boiler technology. Supercritical PC boilers are es timated to emit about 30% less NOx than the proposed CFB boilers. This amount is approximat ely 0.02 lb/MW-hr. However, even if the proposed facility were to operate at full capacity for an en tire year, and all of the NOx generated from operating at full capacity were assumed to be N20, the total greenhouse gas

contribution from the additional NOx emissions is only about 0.3% of the total allowable

annual CO2e emissions. 21

In addition, emissions of other pollutants, such as hydrochloric acid, l ead, hydrofluoric acid, and mercury, are higher for PC boiler versus CFB boiler technology. MDEQ has discretion to consider the priority of the varying pollutants emitted from a facility taking into

consideration other State initia tives. Michigan has a statewi de mercury reduction initiative,

and toxics and health-based rules that limit em issions of these pollu tants. Whenever a health-based standard exists, it will almost al ways be rated a higher priority than a nonhealth based standard. In the proposed Wolver ine CFB boiler project, the emissions of these pollutants are considered a higher priority than greenhouse gases currently are. Thus, MDEQ disagrees with the commenter that PC boiler technology is preferable to CFB boiler technology.

It is a common misconception that CFB boile rs emit 15-20% more N2O than PC boiler technology. This is because early sampling me thods yielded incorrect results due to errors inherent in the sampling methods in use. “In the turn of the 1990s nitrous oxide (N2O) was measured usually by non-continuous methods , such as bag sampling followed by an analysis with gas chromatography (GC). This method, however, was prone to errors. It was noticed that too high N2O c oncentrations were determined in bag samples because NO,

SO2 and H2O formed N2O as an artifact. Ther efore, based on these measurements, wrong

conclusions were drawn about nitrous oxide emissions.” 22

It was later determined that, “CFB boilers inherent ly operate at lower temperatures and have lower NOX emissions than pulverized coal bo ilers, but can emit some N2O. Cell burners (manufactured in 1950s and 1960s ) rapidly mix pulverized coal and combustion air resulting in highly turbulent and efficient combustion, but NOX emissions are high, typically 1.0 to 1.8

lb/mmBTU.” 23 Uncontrolled emissions of NOx are lower for a CFB boiler than a PC boiler because the combustion temperatur e of a CFB boiler (1544 - 1652°F) is much lower than a

21 {[(0.02 #/Mw-hr)x(8760 hrs/yr)/ (2000 #/ton)*310] / 6,024,107 tons CO2e allowed/yr} * 100% = 0.3%

22 Non-CO2 greenhouse gas emissions from boilers and industr ial processes, pgs 26-27, Tsupari, E, et al, VTT Research Notes 2321, ESPOO 2005

23 NOx Emissions Produced with Combustion of Powder River Basin Coal in a Utility Boiler, pg 19, WRI-97-R033, Nordin, John S and Merriam, Norman W., April 1997, US Department of Energy Office of Fossil Energy

### Wolverine Power Supply Cooperative, Inc. Response to Comments Document Page 97 of 140 June 29, 2011

PC boiler (2462 - 2732°F) which results in lowe r NOx formation. (NOx present in flue gas generally comes from two sources: the oxidat ion of nitrogen compounds in the fuel (fuel NOx) and the reaction between the nitrogen and oxygen in the combustion air (thermal NOx). With low temperature and staged combusti on, the oxidation of fuel nitrogen is suppressed resulting in very low NOx emissions). Additional control of NOx in the proposed Wolverine CFB boilers are provided by select ive non-catalytic reduction (SNCR), which can control NOx with efficiencies up to 75%. For a PC boiler, add-on control of NOx can be provided by selective catalytic reduction (S CR) systems. SCR is a post combustion system

that can reduce NOx emissions at 85 to 90% efficiency. Howe ver, the higher efficiency of

SCR control on a PC boiler does not mean that overall emissions of N2O will be significantly
lower than for CFB boiler. Thus MDEQ di sagrees that CFB boilers emit 15% more greenhouse gases than PC boiler technology.

Petroleum coke (petcoke) is proposed as one of the fuels in the feedstock mix. On a pounds per ton basis, petcoke does create more gree nhouse gases than other f uels. However, it also has a higher heating value, so less needs to be combusted to generate the same amount of energy as other fuel s. For example, to get the same amount of energy you get from combusting one pound of petroleum coke , you would need to combust almost 1.5 pounds of sub-bituminous coal and about 1.6 pounds of dry wood (green wood would be considerably higher). The tabl es below provide information regarding the emissions of individual greenhouse gases in a variety of units, and a comparison of greenhouse gas emissions from the different fuels proposed in the project, based on heating value of the fuel. It is clear from this data that CO2 is by far the largest greenhouse gas emitted from combustion of any of the fuels proposed by Wolverine, even when Global Warming Potentials are applied to the i ndividual greenhouse gases.

GHG emissions in #/mmBTU – proposed Wolverine project

Fuel Type CO2 (#/mmBTU) CH4 (#/mmBTU) N2O (#/mmBTU) Subbituminous coal 213 (97.02 kg) 0.024 (0.011 kg) 0.004 (0.0016 kg) Coke 225 (102.04) 0.024 (0.011) 0.004 (0.0016)

Wood/Wood

Residuals 206.4 (93.8) 0.07 (0.032) 0.009 (0.0042)

GHG emissions in #/ton fuel – proposed Wolverine project

Fuel Type CO2 (#/ton fuel) CH4 (#/ton fuel) N2O (#/ton fuel) Subbituminous coal 3682 (1674 kg) 0.042 (0.019 kg) 0.061 (0.028 kg) Coke 5567 (2531) 0.60 (0.27) 0.087 (0.040)

Wood/Wood

Residuals 3174 (1443) 1.08 (0.49) 0.14 (0.065)

GHG emissions from combustion by % (based on #/ton) – proposed Wolverine project

Fuel Type CO2 CH4 N2O

Subbituminous coal 99.98 0.001 0.016

Coke 99.99 0.01 0.002

Wood/Wood

Residuals 99.96 0.03 0.004

GHG emissions from combustion by % (based on #/ton), with GWP’s applied – proposed Wolverine project

Fuel Type CO2 (#/mmBTU) CH4 (#/mmBTU) N2O (#/mmBTU)

Subbituminous coal 99.5 0.024 0.49

### Wolverine Power Supply Cooperative, Inc. Response to Comments Document Page 98 of 140 June 29, 2011

Coke 99.3 0.22 0.48

Wood/Wood

Residuals 97.96 0.70 1.34

GHG emissions from combustion by % (based on #/ton) - EPA data

Fuel Type CO2 (#/ton fuel) HHV (mmBTU/ton) Fuel Needed to equal HHV

value of coke Total CO2

emissions to equal HHV of coke

Coke 5579 24.8 1 5579

Subbituminous

coal 3689 17.25 1.44 5304

Ag Biomass 2149 8.25 3 6447

Wood/Wood Residuals (dry) 3180 15.38 1.61 5128

Thus, MDEQ disagrees with the commenter that PC boiler technology is preferable to CFB boiler technology.

Comment : The “redefining the source” rationale does not apply in the present case. Wolverine eliminated multiple available technologies, in cluding natural gas combined cycle, pulverized coal, super critical CFB boile rs, Integrated Coal Gasification Combined Cycle, and biomass gasification, as control options by stating “they would consti tute ‘redesign’ or ‘reconfiguration’ of the project.” GHG Permit Appl. at 1-2. T he “redefining the source” rationale does not apply to options that would reduce pollution while redesigning or reconfigur ing the project. Rather, it permits the agency to exercise limited discret ion to omit options that would fundamentally “redefine the source”. MDEQ applies redefining the source too broadly.

Response : MDEQ disagrees with the commenter. T he “redefining the source” question is been discussed in the NSR Workshop Manual ( page B.13 ) and evaluated by the courts in a

number of documents. These do cuments indicate that an applicant is not required to evaluate cleaner fuels in the BACT analysis, but should evaluate cleaner forms the selected fuel source for the project. Other court decis ions have clarified that an applicant is not required to evaluate fuels that would f undamentally change the scope of the project. 24 In other court decisions, it was det ermined that the ques tion of redesign of a facility to achieve

reduced emissions is the kind of judgment which should be le ft to the Permitting Agency. 25
MDEQ, as the permitting authority, has appropri ately applied its discretion in applying the redefining the source rationale.

Comment : Site specific criteria are not a valid reason for excluding control options. As MDEQ points out, elimination of control technologies must be for reasons such as “not technically or economically feasible or that energy, environmental, or economi c impacts are unfavorable.” If MDEQ were trying to invoke th e collateral impacts exception here, it failed to do so. An alternative clean fuel may only be rejected fo r the single additional reason of when “using

24 Old Dominion, 3 E.A.D. 779 (1992)

25 Sierra Club v. EPA, 499 F.3d 653, 655-6, on appeal of the EAB’s Prairie State decision, and Hawaiian Commercial & Sugar Company, 4 E.A.D. 95 (1992)

### Wolverine Power Supply Cooperative, Inc. Response to Comments Document Page 99 of 140 June 29, 2011

another type of fuel would be in consistent with the fundamenta l purpose of the facility.” Consequently, since considerati on of clean fuels is required as part of the BACT analysis, the applicant and MDEQ were requi red to consider natural gas.

Response: Site specific criteria were not used to exclude control options. Ho wever, site specific criteria did make the selected control options and boiler design more attractive than other controls and designs considered in the BAC T analysis. For example, by locating the CFB boilers in this specific limestone quarry, a ready source of limestone is av ailable for SOx control, presoftened water is available for cooling, an on-site ash disposal site is available, and a dock is available for delivery of fuel.

The consideration of clean fuels in the BACT analysis only requires consideration of cleaner forms of the fuel being propos ed. This is clearly explai ned in the October 1990 draft NSR Workshop Manual . Since Wolverine has designed a pl ant that will burn petcoke, Powder River Basin coal, and biomass, MDEQ may c onsider cleaner forms of these fuels.

Consideration of natural gas is beyond the scope of the BACT requirements. However, it was considered as part of t he alternatives analysis.

Comment: Wolverine also rejected the use of 100% biom ass combustion, stati ng that a 100% biomass

CFB boiler is limited to 50 MW in size which does not meet the needs of the project. The

use of 100% biomass as fuel in a fluidiz ed bed combustor greater than 50 MW, however, has been demonstrated as technologically feasible and was therefore unreasonably rejected as a control option for the WCEV project. Since May of 2010, a Foster Wheeler 385 MW circulating fluidized-bed co mbustor has been operating for Kaukaan Voima Oy in Finland firing 100% biomass. The power plant is fuel ed by bark, branches, tops , stumps, small wood and peat.

Response: MDEQ disagrees that the Kaukaan Voima Oy CF B boiler has the ability to provide similar electrical output to the proposed Wolverine CFB boiler using only biomass. The Kaukaan Voima Oy CFB boiler plant can provide 125 MW of electricity, 110 MW (thermal basis) of district heat, and 150 MW (thermal basis) of proc ess steam. The actual electrical output is only 125MW, which is approximately 35% of t he capacity of the CFB boilers proposed by Wolverine, which can provide 350 MW (each) of electricity.

Comment:

Wolverine also did not evaluate the use of torre faction to prepare the biomass to reduce the cost of transportation and fuel handling.

Response: Torrefaction is the process of heating the raw biomass to drive off water and volatiles. The remaining material is a charcoal or bio- coal, and can be used in the combustion process along with coal and other fuels. The advantage of torrefaction is that the final product has about 30% more energy per unit of mass, and transportation costs per unit of energy decrease. However, ab out 10% of the original energy in the biomass is lost due to the volatile materials being driven off in the torgas.

### Wolverine Power Supply Cooperative, Inc. Response to Comments Document Page 100 of 140 June 29, 2011

Torrection was not reviewed during the GHG BACT review. However, it should be noted that torrefaction does not come without its own pr oduction costs and environmental penalty. Fuel

must be burned to create the heat needed for th e torrefaction process. The biomass would have emissions of greenhouse gas es along with other pollutants such as volatile organic compounds. So, even though there may be savings from lower transportation costs or better fuel handling characteristics, t he burning of a bio-coal is not necessarily a cleaner form of biomass, and the same or higher amount of greenhouse gases may be emitted through the course of the process.

MDEQ does not believe that c onsideration of torrefaction w ould have changed the outcome of the GHG BACT analysis.

Comment: While both the applicant and MDEQ have relied upon si te-specific criteria as if they define the source, these site specific criteria do not rise to the leve l of being a fundamental purpose of the project. The purpose of th is project, generating electricity, would still be achieved if the project location, combustion technology and fu els were changed to generate significant

reductions in GHG emissions.

Response: MDEQ disagrees that the ability to take adv antage of site-specific attributes were a fundamental purpose of the project. While it is true that site-s pecific criteria do not define the fundamental purpose of the project, the sele ction of the appropri ate combustion process does impact the analysis and outcome of the decision. Site-speci fic attributes are one of the many considerations t hat may have an affect on the sele ction of the process employed and the control strategy. For exam ple, site-specific attributes may make one control strategy more cost effective or a combustion process al ternative more feasible . The site specific factors were just one element that influenced Wolverine’s selection and MDEQ support of a

CFB boiler.

Comment: Although scientists have now thoroughly debunk ed the long-standing my th that biomass combustion is “carbon neutral,” industry propo nents and project applicants continue to seek special treatment for biomass projects bas ed on the dangerously fa lse contention that biogenic greenhouse gas emissions do not affe ct the climate. The company and the State simply assume, but never actually demons trate, that biomass combustion should be

considered carbon neutral.

The GHG BACT Determination “considers” biom ass combustion to be “carbon neutral.” The weight of current scientific work compels the opposite conclusion.

The GHG BACT Determination claims that “the implementation of a sustainability standard”—specifically one derived from Mi chigan law defining “sustainably managed forests”—is “the key to documenting the carbon neut rality” of fuels. Yet the document fails to demonstrate that any of the referenced sust ainable forestry certification methods even considers the atmospheric impac t of biomass combustion, mu ch less establishes “carbon neutrality.” This assumption, however, relies on a simplistic, inventory-based accounting approach that ignores both real carbon dyna mics and the legal requirements of the Clean Air

Act.

### Wolverine Power Supply Cooperative, Inc. Response to Comments Document Page 101 of 140 June 29, 2011

Response: In March 2011 EPA published the Guidance for Determining Best Available Control Technology for Reducing Carbon Dioxide Emissions From Bioenergy Production. This document provides a general discussion regardi ng biomass as an overall net carbon sink, and discusses how CO2 emissions participat e in a global carbon cycle through photosynthesis, which is a form of terrestrial sequestration. In th is document, EPA states that averaged over t he years 1990-2008, the United St ates has been a net sink of 841 teragrams of CO2e per year (about 12% of the av erage gross emissions). EPA further

states that this net carbon sink is expected to continue, if not increase, through 2020. 26
While combustion of biomass may or may not be carbon neutral, MDEQ follows EPA guidance and treats CO2 emissions from biom ass as a net carbon sink, and therefore preferable to combustion of fossil fuels.

Comment: Since the March 16, 2011 GHG BACT determinat ion has been prepared and submitted well after the application, it can be concluded that many of the project design considerations including project location, combustion te chnology and fuels were chosen with no consideration to minimizing GHG emissions. Furt her, since the project and permit remained virtually unchanged after the GHG BACT analysis , the BACT analysis appears to have come to the predetermined conclusion that the projec t and permit as written were BACT for GHGs instead of the BACT analysis driving the po llution controls and emissions limits for the project.

Response: MDEQ strongly disagrees with this commen t. Since the original BACT analysis was performed more than a year before the GHG BACT was required, it may seem that the conclusions were predetermined. Howe ver, this was not the case.

It is important to remember that the GHG BAC T analysis submitted by Wolverine on March 16, 2011, is a supplement to the original BACT analysis for the conventional criteria pollutants. After considering th e information in the original application, the original BACT analysis concluded that the CFB boiler as pr oposed was the best design choice. With the addition of the regulation of GHGs, the questi on becomes; does the regulation of GHGs change the original conclusion? It is clear that some technologi es, such as IGCC, offer an attractive option for capturing CO2. Howeve r, the ability to capture CO2 becomes a less

attractive feature withou t the ability to sequester it. In their March 2011 PSD and Title V Permitting Guidance for Greenhouse Gases document, EPA found that while CCS is a promising technology, there are numerous reasons to eliminate it because it is technically infeasible at this time. During our review of the GHG BACT supplement, MDEQ concluded

that this was the case fo r the Wolverine project.

Next, we determined if any of the other tec hnologies offered any adv antages that would reduce GHG emissions significantly enough to outweigh the conclusions of the original analysis. Again, MDEQ concluded that the ot her technologies did not provide overwhelming

evidence that would necessitate a r edesign of the prop osed facility.

26 Guidance for Determining Best Available Control Te chnology for reducing Carbon Dioxide Emissions from Bioenergy Production, March 2011, USEPA, pg 7

### Wolverine Power Supply Cooperative, Inc. Response to Comments Document Page 102 of 140 June 29, 2011

This left evaluation of the existing proposed CF B boiler design with respect to reduction of greenhouse gas emissions. MDEQ determined that energy efficiency, and a requirement for use of a renewable energy in the form of bi omass in the fuel mix, was BACT for GHGs.

Thus, while conclusions reached in the original BACT analysis may influence the results of the GHG BACT analysis, the GHG BACT was performed independently.

Comment:

The GHG BACT Determination fails to follow several of the steps recommended by EPA for a top-down BACT analysis and thus fails to ens ure that the determination adequately addresses all relevant regulatory and statutory requirements. The document also fails to support conclusions reached at se veral of these steps with fa cts or data in the record.

Response: Guidance from EPA states that, “...EPA has not established the top-dow n BACT process as a binding requirement through rule. Thus permitting agencies that implement an EPA-approved PSD permitting program contained in their State Im plementation Plans (SIPs) may use another process for determining BACT in permits they issue, including BACT for GHGs, so long as that process (and each BAC T determination made through that process) complies with the relevant statut ory and regulatory requirements.” 27 Although MDEQ typically follows the top-down process, it is not unusual to combine steps when appropriate. Because the GHG BACT analysis was a supplement to the original BACT analysis submitted by Wolverine, a modified process was used to evaluate the supplemental information. However, all steps required in the top-down revi ew process were included by MDEQ in the modified analysis.

Comment: IGCC is a technology that can lower control co sts of CO2 emissions because the CO2 in the syngas can be removed prior to combustion. MDEQ and Wolverine failed to include IGCC in the full BACT analysis eliminated it prior to Step 1. MDEQ did do a cost analysis of IGCC within the earlier BACT analysis for other criteria pollutants. However, the omission of GHGs from the list of reduced pollutant s fails both to attribute some of the cost of the plant to control of these harmful pollutants and to spre ad the cost of cont rolling other pollutants

across GHG reductions. Had IGCC been included in the cost-effectiveness analysis for GHG controls, step 3 of the BACT anal ysis, the favorable costs for GHG reductions coupled with greater cost effectiveness for other pollutants would have produced a significantly different overall picture of IGCC. MDEQ was arbitrary and capricious in failing to analyze BACT for GHGs with IGCC with CCS as a control option.

Response: It is clear that some technologies, such as IGCC, offer an attractive option for capturing CO2. However, the second step is s equestration. The ability to capture CO2 becomes a less attractive design feature without the abilit y to sequester it. In their March 2011 PSD and Title V Permitting Guidance for Greenhouse Gases document, EPA found that while CCS is a promising technology, there are numerous reasons to eliminate it in the BACT analysis because it is technically infeas ible at this time. During our review of the GHG BACT supplement, MDEQ concluded that this was the case for the proposed Wolverine project.

27 PSD and Title V Permitting Guidance for Greenhouse Gases, March 2011, USEPA, pg 19

### Wolverine Power Supply Cooperative, Inc. Response to Comments Document Page 103 of 140 June 29, 2011

Comment: Wolverine and MDEQ should have looked beyond Wolverine’s DOE project as the basis for its cost estimates for using CCS to cont rol GHGs. As explained elsewhere in these comments, IGCC technology should have been c onsidered for the plant, instead of solely CFB boiler technology.

Response: In addition to the many technical hurdles to ov ercome, current informat ion suggests that the cost structure for CCS is very high. However, there is very little information available on the cost structure for CCS, which is why we el ected to evaluate the CCS option with the Wolverine-DOE grant proposal information. Based on the information in the proposal, MDEQ found that to sequester even 5-6% of the total exhaust would cost approximately $128 per ton. Considering the large number of tons of greenhouse gases produced through the combustion process, MDEQ determined t hat CCS was not cost effective.

Comment: The BACT analysis submitted by Wolverine and the BACT review conducted by MDEQ are further inadequate because they improperly dismiss CCS as BACT for controlling emissions of CO2 from the facility. Wolverine and MDEQ err in claiming that CCS is not an “available” technology for BACT purposes. Second, Wo lverine and MDEQ make an unsupported and flawed argument that CCS is not economically feasible.

Response:
MDEQ did not claim that CCS was not an availa ble option. MDEQ is well aware that EPA considers CCS an available technology. 28 However, EPA also indicates in this document that while CCS is a promising technology, ther e are numerous reasons to eliminate it as technically infeasible at this time, recognizing that the signific ant logistical hur dles presented by CCS technology sets it apart from other c onventional forms of pollution control equipment. Off-site land acquisition, funding, and liability fo r long term storage were all cited in the EPA guidance document as making CCS prohibitive at this time. Thus, MDEQ eliminated CCS in Step 3 of the BACT analysis for these reasons.

Comment: An example of a recent permit fo r a supercritical plant is that issued for a new unit at the Trimble County Generating Station. AEP Sout hwestern Electric Po wer Company recently obtained a permit to build a 600 MW ultra-supercritical unit in Arkansas. In addition, ultra-supercritical units have been permi tted and in use overseas. MDEQ shows the randomness of its BACT process: the agency re quired IGCC to be considered in the BACT analyses for the supercritical PC boiler plant pro posed by Consumer’s Energy and the subcritical CFB boiler proposed here, but did not require Wolverine to consider SPC in its BACT analysis for the subcritical CFB boiler. MDEQ must explain why IGCC is an alternative to supercritical PC boiler and the Wolverine subcritical CFB boiler for criteria pollutants, but supercritical PC boiler is not an alternative to the proposed plant for GHGs. Ultra-supercritical PC boiler also shoul d be considered in the GHG BACT analysis.

28 PSD and Title V Permitting Guidance for Greenhouse Gases, USEPA, March 2011

### Wolverine Power Supply Cooperative, Inc. Response to Comments Document Page 104 of 140 June 29, 2011

Response: Pulverized coal (PC) boiler te chnologies (subcritical, supercr itical, and ultra-supercritical) were eliminated in Step 2 of the BACT analys is because they do not have the demonstrated ability to utilize the mixt ure of fuels proposed by Wolverine. Although PC boiler technology is capable of burning biomass, special handling is required when biomass exceeds about 3% of the fuel mix due to physical limitations of the pulverizer. (Wolverine Power Cooperative

Electric Generation Alternativ es Analysis – Volume 1, A ppendix A-2, June 8, 2009, pg 17)

In addition, PC boiler technology would not take advantage of site-specif ic characteristics to the extent that CFB boiler technology does. CFB boiler allows direct addition of limestone in

the boiler feed for sulfur control. PC boiler technology would require wet flue gas desulfurization, and which would create a new wastewater stream that would have to be

collected and treated.

Furthermore, greenhouse gas emissions are wi thin about 3% of eac h other for these technologies while emissions of lead, hydrochloric acid, hydr ofluoric acid, and mercury all increase with PC boiler technology.

Therefore, the MDEQ has determined that t here is no significant advantage to PC boiler technology that would outweigh the benefit s derived by selecting CFB boiler.

Comment: Given the requirement to conduct BACT for gre enhouse gases as well as criteria pollutants, MDEQ should have considered a supercritic al CFB boiler in its BACT analysis. MDEQ references the supercritical CFB boiler constructed in 2009 for the Ł agisza Power Plant in Poland, but states that “there is limited information on the performance of the unit” and dismisses this as a “developing technology. ” In March, 2010, Foster Wheeler concluded that: “After operating over 4000 hours, it can be st ated that initial operat ion experience of the

Ł agisza boiler has been excellent.” Due to the success of the Ł agisza CFB boiler, Foster Wheeler is moving forward to design an 800 MW supercritical steam CFB boiler. The

Ł agisza supercritical CFB boiler has operated successfully for over 1 and half years.

Wolverine concludes both facilities have a sim ilar heat rate but dismisses supercritical CFB boilers as not being demonstrated as capable of operating with bi omass fuels. However, Foster Wheeler itself indicates that supercritic al CFB boilers can fire up to 20% biomass, the percentage proposed by Wolverine. MDEQ and Wolverine were required to conduct a more thorough BACT analysis of t he availability and feasibility of this technology and may not arbitrarily dismiss it as deve loping because the designs for the Wolverine plant call for a

subcritical CFB boiler.

Response: While supercritical CFB boiler technology shows great promis e, after only 6 months of operation we believe it is premature to requi re supercritical CFB boiler technology as BACT over subcritical technology, wh ich has a very long and successf ul history. There is been very little information available regarding o peration of the Lagisza CFB boiler other than

Foster Wheeler’s literature. Based on an inform ation search via the internet, it appears that the Lagisza CFB boiler is still under-going fine t uning and has yet to undergo stack testing to verify vendor guarantees. “After fine tuning of controls and optimiz ation of the boiler

### Wolverine Power Supply Cooperative, Inc. Response to Comments Document Page 105 of 140 June 29, 2011

performance, a 720 h trial operation will begin fo llowed by plant takeover and start of the commercial operation.” 29

While emission results are available in the Foster Wheeler literature, the background data, testing methods, and verification of data, are not provided in any of the literature we were able to find. At this point it is not even clear if fuels other than European bituminous coals have been used in the boiler and if so, in what ratios.

Nor is it clear if the technol ogy will continue to perform at su ch high reported efficiencies over time. With the exception of a few news articl es reporting on the new technology, almost all of the available information has been provided by the vendor, Foster Wheeler. However, this information does not provide any information t hat allows an independent party to verify the reported efficiency of the unit.

In addition, since the unit has only been in operation for about a year and a half, maintenance and reliability have yet to be proven . However, the sub-critical CFB boiler technology proposed by Wolverine is well proven with the technology, fuel mix, and air quality control strategies proposed. Wolverine is staking t he future of the company on this proposed facility, and c annot be expected to risk the viab ility of their company with a technology that is still being verified by the vendor.

For these reasons, super critical CFB boiler is currently considered a developing technology by the MDEQ.

Comment: The GHG BACT Determination lists “biogeni c fuel augmentation” among the “possible control technologies” identified for the Project, but does not explain why this technology is even appropriate for identification at Step 1 of the BACT analysis. The purpose of Step 1 is to identify “inherently lower emitting processe s/practices,” add-on cont rols, and combinations thereof. The GHG BACT analysis does not demonstrate that biomass combustion is “inherently” lower-emitting. Indeed, biomass co mbustion can result in more greenhouse gas emissions per unit of energy produced than either coal or natural gas.

Response: MDEQ believes it is appropriate to include biogenic fuel augmentat ion as an available technology. While it is true that biomass may emit more greenhouse gas on a heat input basis, it is also considered a renewable and “carbon neutral” fuel. Selection of biomass as BACT is supported in of the March 2011 Guidance For Determining Best Available Control Technology For reducing Carbon Dioxi de Emissions From Bioenergy Production . On page 29 of that document, EPA states “...[forest] residuals that w ould otherwise decompose in a 10-15 year time frame, the net carbon cycle impact of this biomass fuel is expected to be negligible. Thus for a feedstock composed of such residue material, the costs of applying strategies to reduce emissions from the facilit y do not appear justifi ed at this time because

the carbon dioxide emissions from the individual facility woul d not be increasing atmospheric impacts above the business as usual case.” EPA further states “...EPA believes the energy

and economic benefits of this fuel is sufficient at this time to justify selecting biomass fuel as BACT for greenhouse gases wit hout further control.”

29 Utility CFB goes “Supercritical” – Foster Wheeler’s Lagisza 460 MW e Operating Experience and 600-800 MWe Designs, James Utt, Arto Hotta, Stephen Goidich, August 19-21, 2009, pg 11, http://www.fwc.com/publications/te ch_papers/files/TP_CFB_09_12.pdf

### Wolverine Power Supply Cooperative, Inc. Response to Comments Document Page 106 of 140 June 29, 2011

MDEQ concurs with EPA guidance, and incl uded biogenic fuel augmentat ion as an available technology in Step 1 of the BACT analysis.

Comment:

The GHG BACT Determination’s discussion of t he technical feasibility of burning biomass as BACT begins not with any technical analysis, but rather with a survey of federal and state policy provisions that favor biomass energy generation. These policy judgments have no place in a BACT analysis.

Response: MDEQ disagrees with this comment. Selecti on of biomass as BACT is supported in of the

March 2011 Guidance For Determining Best Avail able Control Technology For reducing Carbon Dioxide Emissions From Bioenergy Production . On page 27 of this document EPA states, “Renewable fuels policies, which in some cases provide incentives for the substitution of renewable fuels for fossil fuels, have not traditionally been part of the BACT energy impacts analysis. However, cons ideration of renewable energy policies could become part of the BACT analysis, especially if state policies mandate the repl acement of fossil fuel with biogenic fuel. In addition to numerous federal pr ograms, as of February 2011, states have

some kind of state-level financial or conserva tion incentive program that includes biomass production and almost as many states have rules, regulations or policies that promote bioenergy use.”

EPA further states that “...wher e a bioenergy facility is projec ted to provide the energy and

economic benefits described above in accordance with existing federal or state policies promoting utilization of bioma ss for energy production, these considerations may justify selecting the option of exclusiv ely using a biomass fuel as BA CT for biogenic CO2 emissions from a bioenergy facility.”

Clearly, the EPA guidance supports permitting agenc ies factoring federal and state policies

into the BACT determination for biomass. MD EQ concurs with this approach and factored this into the evaluation process.

Comment:

The GHG BACT Determination also fails to provide any meaningful discussion of the environmental impacts of co-firing with biom ass. The GHG BACT Determination fails to answer even the most basic ques tions: what is the environment al effect of collecting and burning biomass from areas within 75 miles of the Project? What are the effects at a 5% co-firing rate, as opposed to a 20% co-firing rate ? What is the effect (on soils, water quality, and habitat) of removing logging residuals and burni ng them, rather than leaving them in the forest? The MTU Report provides no actual evidence fo r concluding that every acre of “herbaceous open land” or other “open lands” is , in fact, “abandoned agricultural land.” Nor does the MTU Report provide any support for it s conclusion that energy crop conversion will be beneficial for biodiversity.

Response: The MTU Report estimates that Wolverine woul d require approximately 168,105 dry tons of biomass per year to provide 5% feedstock , and 672,418 dry tons biomass per year to

### Wolverine Power Supply Cooperative, Inc. Response to Comments Document Page 107 of 140 June 29, 2011

provide 20% of the total feedstock. 30 MTU also estimates that the “... ‘unused’ portion of annual removals, comprised of logging residues that are normally left on-site and ‘other’ removals, such as road and right-of-way cleari ng and thinning treatments”, would provide approximately 220,000 dry tons of bioma ss, or about 7%, annually, assuming a 65% recovery rate of this material. 31 As described in the report, th is estimate considered only the currently unused portion of biomass residues as mate rial that is available to Wolverine within

a 75-mile radius of t he proposed facility. In addition, collecting this material will reduce emissions generated by decay of this organic material.

MTU also found that Michigan Forests are currently growing more wood than is removed through timbering and natural mortality. Cu rrently, average harvest levels in Michigan’s northern lower peninsula are about 1/3 of curr ent growth. If this additional existing biomass growth were used, co-firing at more than 20% biomass would be feasible in a supply radius

of 50-miles. 32

While MTU acknowledges that sufficient info rmation is not available to draw strong conclusions, they were able to use various governmental databases and the knowledge of local county extension and USDA staff to de velop recommendations. Available herbaceous open land was estimated using “...data from the US DA Forest Service, Forest Inventory and Analysis Program (FIA)(Miles 2007) and the agricultural and open-land based using data from the State of Michigan’s IFMAP (Integr ated Forest Monitoring, Assessment and Prescription) program (MI DNR 2006).” 33 Through personal communications with county extension and USDA personnel, MT U learned that much of the land identified as herbaceous open-land is actually abandoned farm land. 34

The study looked at both ava ilable unused forest residuals and other removals (such as brush clearing), and development of a sustai nable biomass feedstock through dedicated energy crops. MTU estimates that there ar e an additional 980,000 dry tons per year of

biomass that could be made available thro ugh development of a dedicated energy crop

program. 35 This is more than sufficient to support a 20% biomass feedstock.

Thus MDEQ has determined that the MTU report findings suppor t the conclusions reached in the GHG BACT review with respect to biomass sustainability and supply.

Comment:

The GHG BACT Determination c oncludes that co-firing with 5% biomass will reduce CO2e emissions by 4.7%. GHG BACT Determination at 3-13. Nowhere does the document explain how this figure was calculated. Nor does the MT U Report contain any data to substantiate

30 Biomass Co-Firing for the Wolverine Clean Energy Vent ure, Michigan Technological University, January 30, 2008, page 2

31 Biomass Co-Firing for the Wolverine Clean Energy Vent ure, Michigan Technological University, January 30, 2008, page 7

32 Biomass Co-Firing for the Wolverine Clean Energy Vent ure, Michigan Technological University, January 30, 2008, page iii

33 Biomass Co-Firing for the Wolverine Clean Energy V enture, Michigan Technological University, January 30, 2008, pg 6

34 Biomass Co-Firing for the Wolverine Clean Energy Vent ure, Michigan Technological University, January 30, 2008, page 6

35 Biomass Co-Firing for the Wolverine Clean Energy Vent ure, Michigan Technological University, January 30, 2008, page 8

### Wolverine Power Supply Cooperative, Inc. Response to Comments Document Page 108 of 140 June 29, 2011

this claim. As a result, the GHG BACT Dete rmination lacks any support for its ultimate conclusion that co-firing with 5% biomass should be considered BACT.

Table 1 of the Supplemental U pdate seems to include CO2 emissions from biomass in the Project total of 5,878,168 tpy CO2e from t he CFB boilers. The GHG BACT Determination states that all proposed BACT measures, in cluding biomass co-firing at 5% and energy efficiency measures, will result in a 4.7% reduction in CO2e emissions. The document proposes to enforce a 5,722,000 tpy “cap” on CO2 emissions through “continuous emissions

monitors at the CFB boiler stac k.” The proposed cap would result in a reduction of only 156,168 tpy CO2e from the CFB boilers. A 4.7% reduction in CO2e emissions from the CFB boilers, however, should be 276,274 tpy.

Response:

The Wolverine BACT submittal indicates that thr ough co-firing using 5% biomass in the fuel feedstock, implementing energy efficiency measures, and following the manufacturer’s guidance for proper operation of equipment, the net result is a reduction of greenhouse gas emissions attributable to fossil fuels is approxi mately 4.7%. However, because greenhouse gas emissions reductions attributable to ener gy efficiency and following manufacturer’s guidance are not easily quantifiabl e, the actual reductions are expected to be slightly higher than estimated because this figure was calc ulated using only gre enhouse gas emissions

from fossil fuels that would be elimi nated through the use of biomass.

The Wolverine BACT submittal calculates that at a 5% biomass f eedstock rate, 284,000 tons

of CO2e emissions from fossil fuels will be av oided. The report also discusses a 5,722,000 ton per year cap on CO2e emi ssions from the boiler.

4.7% = [(284,000 + 5,722,000) / (5,722,000)] * 100%

Note that these values were not used in the AQD review due to a miscalculation of the total CO2e emissions from the proposed facility in the Wolverine BACT submittal. This error was later corrected, but the reduction in CO2e emissions from fossil fuels was not recalculated.

Comment: It is not clear how this “cap” will be enforc ed. The GHG BACT Determination proposes to measure the cap “with continuous emission monitors at the CF B boiler stack,” which will necessarily capture bioma ss CO2 emissions as well.

Response: The proposed deferral of CO2 from biogenic sources is not final at this time. Therefore the greenhouse gases from bioma ss combustion are not exempt from regulation and must be counted when determining compliance with t he proposed emission limit. MDEQ has proposed conditions in the per mit that account for all greenhouse gas emissions.

Comment: The Biomass Study fails to account for the greenhouse effects of burning standing timber,

which will include N2O and other compounds which are far mo re potent greenhouse gases

than CO2. It does not account for the short-term reduction in sequestration caused by increased harvesting and burning of wood with currently sequestere d and subsequently released carbon, nor the N2O emissions from burning wood. The greenhouse effects of

### Wolverine Power Supply Cooperative, Inc. Response to Comments Document Page 109 of 140 June 29, 2011

other gases, such as N2O, wh ich are released by burning wood, are released from CFB boilers, and are many times more potent than CO2. The analysis must include amounts and multipliers of these more potent greenhouse gases.

Response: Higher GWP greenhouse gases were included in the analysis. Greenhouse gases with higher Global Warming Potentials (GWP), such as methane (CH4) and nitrous oxide (N2O), were evaluated as part of the review process to determine t heir contribution to the total CO2e. Using CO2e allows us to compare gree nhouse gases with different GWP, (e.g. 1 ton of N2O is equivalent to 310 tons of CO2). Thus one ton of N2O equals 310 tons of CO2e. However, even though N2O has a much high er GWP than CO2, the total N2O emissions

from the CFB boilers account for less than 0.5% of the total CO2e emissions (GWP applied). Thus, the effects of higher GWP greenhous e gases such as methane and N2O were considered by MDEQ in the analysis.

Comment: Minimizing CO2 emissions in the next few years is critically important to meeting climate targets, even if some of all of that CO2 might in theory be reabsorbed from the atmosphere

in the decades or centuries to come.

Response: Existing rules regulating greenhouse gas emissions do not take the effects of climate change into consideration. EPA specific ally provides guidance contrary to this effort, “As a general matter, GHG emissions contribute to global warm ing and other climate c hanges that result in impacts on the environment and society. However, due to the global scope of the problem, climate change modeling and evalua tions of risks and impacts of GHG emissions currently is typically conducted for changes in emissions orders of magnitude larger than the emissions from individual projects t hat might be analyzed in PSD permi t reviews. Quantifying these exact impacts attributable to the specific GHG source obtaining a permit in specific places is not currently possible with climate change modeling. Given thes e considerations, an assessment of the potential incr ease or decrease in the overall level of GHG emissions from a source would serve as the more appropriate and credible metric for assessing the relative environmental impact of a given control strategy.” 36

Comment:

The GHG BACT Determination fails in its most basic task: providing an assessment of the relative cost-effectiveness of burning biomass. Indeed, neither the GHG BACT Determination nor the MTU Report quantify the co st of control for combustion of biomass at 5% of the fuel mix (the proposed BACT measure).

Response: Step 4 of the BACT analysis is to evaluate the most cost effective control strategies, and Step 5 is to select BACT. No cost analys is was required for the following reasons:

- Selection of biomass co-firing with the primary fuel meets existing state policies promoting utilization of biomass for ener gy production, ther eby reducing carbon

emissions from fossil fuels.

36 (PSD and Title V Permitting Guidance for Greenhous e Gases, USEPA, March 2011, pgs 41-42)

### Wolverine Power Supply Cooperative, Inc. Response to Comments Document Page 110 of 140 June 29, 2011

- Co-firing 5% biomass with the primary fuel would not significantly reduce the efficiency of the boiler even when using bi omass with higher moisture contents.

- The MTU study found that at a recovery ra te of 65%, 220,000 dry tons per year of existing forest residuals are available within a 75 mile radius of the proposed facility.

This is more than sufficient to meet the 5% biomass requirement in the permit.

- The cost of using biomass is offset by t he reduction in costs associated with petcoke

and PRB coal.

Based on these factors, MDEQ believes that a mi nimum of 5% biomass in the fuel feedstock is both technically feasib le and cost effective.

Comment: The discussion of potential energy efficiency m easures in the GHG BACT Determination is underdeveloped and fails to follow EPA guidanc e. Indeed, the discussion does not even identify which specif ic efficiency meas ures are being proposed. T he document thus provides no basis for determining which ene rgy efficiency measures are available and applicable to this Project.

Response: The concept behind incorporating energy effici ency measures into the draft permit for the proposed facility is that when the plant is operated as effi ciently as possible, the power needed to operate the plant is reduced, ther eby reducing overall fuel consumption and emissions of greenhouse gases.

Energy efficiency measures ar e largely determined during the design of the plant during planning and engineering phases. The general effi ciency of the proposed plant is evaluated as part of the BACT process. Specific energy efficiency m easures are determined during final design of the plant and during developm ent of operational pr actices. Because

Wolverine is not at the final desi gn stage, it is technically infeas ible to identify specific energy efficiency measures that will be employed in t he final design because the measures selected will be dependent on facility-specif ic, as-built site conditions. Therefore, energy efficiency measures can only be identified in the per mit in a general sense at this time.

However, MDEQ has included language in the pro posed permit that spec ifies that during the design phase of the project, Wolverine shall inco rporate energy efficient equipment wherever practical in the design of each boiler included in FGCFB. Specifically, MDEQ has required that the design of each boiler, at a minimum, shall specify that all motors over 100 horsepower shall be variable speed, all air pollu tion control devices shall be operated at the minimum pressure drop required to maintain compliance with permit limits and conditions, thermal performance of all heat tr ansfer components at the facilit y, including structures, shall be designed to maximize energy efficiency, and energy efficiency shall be optimized, where practical, for all fans, moto rs and other equipment necessa ry to operate each boiler and support systems. 37

MDEQ has also included language in the proposed permit to address energy efficiency through an Energy Efficiency Management Plan (EEMP). This is a living document and is intended to influence not only des ign and operation of the fac ility when it is initially constructed, but also to in corporate changes once experienc e is gained through on-going

37 Wolverine Power Supply Draft Permit to Install No. 317-07, FGCFB, IV.4

### Wolverine Power Supply Cooperative, Inc. Response to Comments Document Page 111 of 140 June 29, 2011

operation of the facility. Permit conditions requiring the source to address a concern prior to construction is common practice for other sim ilar situations, such as Malfunction Abatement Plans (MAP) and Fugitive Emission Control Plans (FECP), and provides the State with continued oversight of the proj ect for specific purposes ev en after permit issuance.

In their March 2011 PSD and Title V Permitting Guidance for Greenhouse Gases (pg 21), EPA also recommends perform ance benchmarking as a method to assess energy efficiency. 38 Plant energy benchmarking is the process of comparing the energy performance of one site against itself over ti me or against the range of performance of the industry, and is typically done at the whole facility level to account for differences in technology, operating practice s, and operating conditions. 39 Since the Wolverine CFB boilers have not yet been cons tructed or operated, performan ce benchmarking is of limited

use at this time.

EPA also recommends the use of output based limits when num erous small energy savings methods are employed in the des ign and operation of a facility. 40 MDEQ has included an output based limit of 2.1 lb/KW- hr on a gross output basis. This limit is intended to not only include energy efficient design and work practices in the proposed plant, but also to require them to maintain a high level of energy effi ciency throughout the life of the facility.

Comment: The GHG BACT Determination fails to prov ide any meaningful evaluation of the cost-effectiveness related to proposed energy efficiency control measures. Promising “consideration of plant thermal component effici ency” in the design process is no substitute for identifying proposed effi ciency measures and evaluati ng their economic, energy, and environmental impacts. Nor is an assuranc e that the Project operator will follow manufacturers’ O&M guidelines a meaningful control measure, unless the Project operator had been planning to violate these guidelines as a matter of course before identifying this approach. In short, the Step 4 anal ysis of energy efficiency ignor es virtually every component

of a defensible BACT determination.

Response: The response to the prior question discussed eval uation of energy effi ciency measures and the EEMP in detail. As explained in that response, it is technically infeasible to identify or evaluate specific energy effi ciency measures that will be employed in the final design

because the measures selected will be dependent on facility- specific, as-built site conditions.

We have included language in the draft permit indicating that the operator follow manufacturer’s guidelines as a control measure because the engi nes, fans, and other equipment necessary to operate the CFB boiler may be operated under various conditions. There will also be guidelines on how to operate and maintain the equi pment to achieve the most efficient operation for the desired electr ical output. Thus the proposed language was not included in the draft permit because we be lieve the operator intended to operate the CFB

boilers inconsistent with best operating practices.

38 PSD and Title V Permitting Guidance for Greenhouse Gases, USEPA, March 2011, pg 21

39 Available and Emerging Technologies for Reducing Greenh ouse Gas Emissions From Industrial, Commercial, and Institutional Boilers, October 2010, USEPA, pg 25

40 PSD and Title V Permitting Guidance for Greenhouse Gases, March 2011, pg 22

### Wolverine Power Supply Cooperative, Inc. Response to Comments Document Page 112 of 140 June 29, 2011

Comment: The Applicant has not shown that equally effe ctive greenhouse gas contro ls cost only $8/ton. In fact, the Applicant has not provided enough information on the control- and cost-effectiveness of other proposed BACT m easures (biomass and energy efficiency) to even enable a relative comparison. The short- cut attempted in the GHG BACT Determination does not even attempt to comply with the re quirements for this step of the BACT analysis.

Response: There is very little, if any, reliable data rega rding a cost effective level for greenhouse gas control costs. EPA makes this clear by stating, “...given that there is little history of BACT analyses for GHG at this time, there is not a wealth of GHG cost effectiveness data from prior permitting actions for a permitting authorit y to review and rely upon when determining

what cost level is consi dered acceptable for GHG BACT.” 41

In their March 16, 2011 GHG BACT Supplement submittal, the applicant attempted to develop a cost effectiveness basis for GHGs by making comparisons between the greenhouse gas applic ability threshold estab lished in the Tailori ng Rule and the average control cost effectiveness threshold of approxim ately $8,000 per ton for a criteria pollutant. 42
Using this information, Wolverine assumed t hat EPA was attempting to equate 100,000 tons of CO2 to the 100 tons per year threshold for major sources defined in one of the 28 source categories in the PSD rules, and thus estab lish an $8 per ton contro l cost threshold for

GHGs. This cost effectiveness threshold wa s not used in the AQD evaluation of the GHG BACT Supplement.

EPA also suggests that for the economic analysis, “...it may be appropriate in some cases to assess the cost effectiveness of a control opt ion in a less detailed quantitative (or even qualitative) manner... As with all evaluations of economics, a permitting authority should explain its decisions in a well-documented permitting record.” 43

As MDEQ evaluated the GHG BACT Supplement submitted by Wolverine for each step of the BACT process, all of the various contro l options dropped out for reasons other than economics, and by Step 4 of t he process, we were left with only energy efficiency and biomass augmentation. Since t he applicant was willing to accept conditions requiring both of these options under BACT, MD EQ elected to observe EPA’s guidance, and there was no need to perform an economic evaluation.

Comment: A thorough assessment of biomass availability must look at not simply how much forest growth occurs within the procurement area, but how much is actually available for purchase. Without considering any compet ing proposals, Wolverine’s conc lusion that there are unused logging residues of 220,000 dry tons per year which are available and sufficient to meet Wolverine’s co-firing requirements are suspect.

According to the MTU Report, the Project will re quire 168,105 dry tons per year of biomass to sustain a 5% co-firing rate. The MTU Repor t concludes that 177,591 dr y tons per year of logging residues, and 41,510 dry tons per year of “other removals” (“road and right-of-way

41 PSD and Title V Permitting Guidance for Greenhouse Gases, USEPA, March 2011, pg 43

42 (Prevention of Significant Deterior ation and Title V Greenhouse Gas Tailoring Rule, Federal Register, Vol. 75, No. 106, published June 30, 2010)

43 PSD and Title V Permitting Guidance for Greenhouse Gases, USEPA, March 2011, pg 42

### Wolverine Power Supply Cooperative, Inc. Response to Comments Document Page 113 of 140 June 29, 2011

clearing and thinning treatments ”), are available within the “bioshed,” defined as a 75-mile straight-line radius around the Project. Howe ver, the MTU Report does not provide any analysis of the cost of transportation of l ogging residues and “other removals” over these distances. The MTU Report thus does not establish that enough residues and “other removals” exist within an economically feasible transport radius of the Project to support even a 5% co-firing rate. Finally, the MTU Repo rt fails even to mention or analyze competing

demand for biomass feedstocks in the same bioshed.

Response: The MTU study developed the 220,000 dry tons per year of available biomass using the USDA Timber Products Output database (USDA FIA-TPO 2006 ) and assumed an availability rate of 65%. As the report explains, this es timate is based on the “... ‘unused’ portion of annual removals, comprised of logging residues that are normally left on-site and ‘other’ removals, such as road and right-of -way clearing and thinning treatments.” 44 As described in the report, this estimate considered only t he currently unused portion of biomass residues as

material that is available to Wolverine. Esti mating future additional demand for these unused residues would be pure conjecture.

However, the MTU study looked at both av ailable unused forest residuals and other removals (such as brush clearing), and deve lopment of a sustainable biomass feedstock through dedicated energy crops. MTU estimate s that there are an additional 980,000 dry tons per year of biomass that could be made available through development of a dedicated

energy crop program. 45

Comment: MDEQ’s calculation of the “par asitic load” of energy, and co rresponding costs, required for
CCS is also flawed. MDEQ claims that the “parasitic load” of energy required to power GHG capture at the Wolverine facilit y would “reduce the net generati ng capacity of the proposed CFB boiler by a minimum of 20%,” and thus would require additional output from the proposed design to achieve the desired energy production, generating additional emissions

and additional costs to control those emissions. But a recent study shows that the energy penalty (parasitic load) of using MEA for carbon capture at a 500 MW plant is just less than 20%, while the penalty of using H3-1 at the same sized plant is approximately 16%. Thus, the “parasitic load” required for capture should be estimat ed to be 20% or less, and costs should be estimated accordingly.

Response:

There are no known full scale commercial CCS operations available to evaluate actual performance data on at this time. Therefore, all estimates are theoretical, or developed through pilot scale tests.

In the GHG BACT analysis, 20% was used as a lower limit because our research found such a wide range of estimates of the parasitic load from a variety of sources. One report from the Department of Energy estimates the parasit ic load of a full CCS system at over 47%. 46
Another source indicates, “...parasitic energy requirement can range from around 25% for

44 Biomass Co-Firing for the Wolverine Clean Energy Venture, January 30, 2008, pg 7

45 Biomass Co-Firing for the Wolverine Clean Energy Venture, January 30, 2008, pg 8

46 Existing Plants, Emissions and Capture - Setting CO2 Program Goals, Append ix C-5, April 20, 2009,

DOE/NETL-2009/1366

### Wolverine Power Supply Cooperative, Inc. Response to Comments Document Page 114 of 140 June 29, 2011

post-combustion capture at a high efficiency ultra-supercritical c oal plant up to over 37% for a typical subcritical plant” 47

The example cited in the comment was part of a Department of Energy network of seven Regional Carbon Sequestration Partnerships (R CSPs) that were created to develop the technology, infrastructure, and regulations to implement large-scale CO2 sequestration in different regions and geologic formations within the Nation. The estimates of parasitic loads in the comment reflect the results of a Stage 1 capture trial, and do not include costs associated with sequestration, which can substantially increas e both parasitic load and cost of control. In addition, bec ause this is still a pilot study, there may be additional costs to scaling it to a full commercial operation, such as the costs of long term corrosion impacts. In addition, the presentation cited by the comment er as the source for the parasitic load estimates contains only conclu sions of the study and does no t provide the data used to develop these conclusions.

Thus MDEQ disagrees that the review was flawed.

Comment: Wolverine BACT analysis contains the same def iciency that USEPA ident ified in its recent comments on the GHG Analysis for the Paci ficorp Lake Side Power Plant: a failure to establish permit emission limits as PSD BACT for GHG emissions. The Wolverine BACT analysis also contains the sa me deficiencies that USEPA ident ified in its recent comments on the WE Energies Biomass Fueled Cogeneration Facility in Rothschild, Wisconsin. In those comments, USEPA specif ied that a GHG carbon dioxi de equivalent in units of

lbs/MWh be established as a BA CT limit, the limit needed to be specific to the operating conditions, and the limit needed to specify whether it includes startup and shutdown periods.

Response: The proposed Wolverine permit contains a limit of 2.1 lb CO2e/KW-hr (gross output) that applies at all times, including startup and shutdown.



### G. Material Handling

Comment : The draft permit failed to incorporate a BAC T analysis including covering storage piles.

Response : MDEQ requested additional information from WCEV regarding the covered storage pile issue. WCEV submitted follow-up informat ion on June 22, 2009 which addressed the covered storage pile comment. That informat ion showed a cost per controlled ton of particulate matter to exceed $4.4 million dollars ; that value exceeds acceptable BACT cost parameters. Any emissions generated from unc overed storage piles would be fugitive in nature. Fugitive emissions – defined under MAPCR 336.1106(l) as those emissions which could not reasonably pass through a stack, chimney , vent, or other functionally equivalent opening – meet the technological limitation st andard included in the BACT definition and are

47 Cost Analysis of Carbon Capture and Storage for the Latrobe Valley, February 28, 2010, Charles Kolstad and Daniel Young, Bren School of Environmental Science and Management, University of California, Santa Barbara, California)

### Wolverine Power Supply Cooperative, Inc. Response to Comments Document Page 115 of 140 June 29, 2011

subject to work practice and op eration standards as BACT. T he Fugitive Emissions Control Plan itself is the work practice st andard necessary to satisfy BACT.

Comment : Reliance on opacity, in place of numeric emission limits; fails to include enforceable BACT

limits for haul roads. The comment further identif ies the lack of any other haul roads in the draft permit to be in violation of BACT.

Response : Haul road activities are subject to the require ments of the FECP. That plan requires, among other things, that unpaved travel surfaces be controlled by the a pplication of water, sweeping, vacuuming, or other acceptable dus t control method on a frequency sufficient to meet the visible emission opacity standard of five percent opacity. BACT is satisfied by the implementation of the FECP as a work process standard. There is no practical method to quantify emissions from haul roads. Theref ore, a mass limit would be unenforceable.

Comment : The PM10 modeling for the 24 hour PM10 NAAQ S analysis and the incr ement analysis is based on unsupported and artificially low emission estimates for the O-N Mineral operations.

This comment further identifi es specific equipment inputs used in these modeling analyses as not representing worst-case emissions.

Response : MDEQ disagrees with this comment. Commenter is correct that the PM10 modeling analysis

must meet a worst case emissions standard meaning that the inputs for the computer modeling must reflect the highest level of air c ontaminant emitted from the modeled process.

However the worst case standard must also re flect any controlling permit requirements for that equipment as well. Emissi ons calculations from the nei ghboring O-N Minerals operation

are based on information taken from both MAERS emissions inventory and the current Permit to Install (PTI) 31-02A issued to the O-N facility. Calculat ed values from MAERS utilize high levels of control efficiencies. PTI 31-02A requires (among other requirements) that most of the limestone processing equipm ent operate within a building enclosure and

emit no visible emissions from the operation. Other equipment and operations at the facility, including truck traffic and storage piles, ar e subject to a 5% opacity requirement and operational requirement from the facility’s Fugitive Dust Contro l Plan. Proper operation of the required control equipment in PTI 31-02A would reflect a high degree of control efficiency. Worst case emissions must repr esent operation of the equipment under the terms of a lawfully issued PTI and cannot be bas ed upon non-compliant operating conditions. Because the modeling inputs repr esent the upper end of allowable emissions from a lawfully permitted facility they correctly repres ent “worst-case” emissions.

Comment : The PM10 modeling for the 24 hour PM10 MAAQ S analysis and the Increment analysis is based on unsupported and artificially low emissi on estimates at the pr oposed coal plant.

Commenter further identifies the assumed values for mois ture content, wind speed, and control efficiencies as violating the “worst-case em issions” standard.

### Wolverine Power Supply Cooperative, Inc. Response to Comments Document Page 116 of 140 June 29, 2011

Response : As discussed above, commenter is correct that the PM10 m odeling analysis must meet a worst case emissions standard meaning that the inputs for the computer modeling must reflect the highest level of air contaminant emitted from the modeled process. However the worst case standard must also reflect any cont rolling permit requirements for that equipment as well. Permit conditions, including the FE CP, require control of generated emissions. Assuming constant moisture c ontent is an acceptabl e procedure when utilizing the AP-42 equations and emission factors. The assumed va lues used in this application fall within the acceptable range. Wind data was reviewed by AQD staff and deemed acceptable for this exercise. The permit conditions, including requirements for operating specific control equipment and operational requirements in the FECP , for this facility reflect high levels of control efficiency for material handling operati ons. Worst case emissions must represent operation of the equipment under the terms of a lawfully issued PTI and not be based upon non-compliant operating conditions.

Comment : The PM10 modeling is based on an inappropria te and unjustified emissions figure for PM10 from haul roads. In particular, commenter ci tes the use of AP-42 emission factors found in Chapter 13 for silt content as too low and not reflective of worst case-emissions.

Response : AQD staff reviewed the haul road emissi ons and assumptions contained within the application and concluded that those calculations are acceptable. Important to remember is

that worst case emissions must represent operation of the equipment under the terms of a lawfully issued PTI and cannot be based upon non -compliant operating co nditions. The haul roads are subject to both Specia l Conditions requiring an opacity limit of 5 % or less and the terms of a FECP, which requires wet sw eeping for paved roads and wet/chemical suppression of dust for unpaved roads in order to meet required opacit y limits. As these opacity requirements are quite stri ngent, the use of low silt cont ent for emissions calculations is justified.

Comment : It appears that Wolverine failed to include emi ssion rates for the physical working of the storage piles in the PM10 modeling analysis. Th is must be done to accurately account for

emissions.

Response : Wolverine accounted for emissions from roadways, wind erosion and pile loading activities from the storage piles. Emissions associated with the physical working of the pile were not accounted for. This number is expected to be a minimal influence on the PM10 modeling analysis and not affect the results in a m anner which violates t he NAAQS or increment consumption from this facility. As a reference, Consumers Energy’s recent permit for a larger facility calculated emissi ons from a storage pile as 0. 18 lbs PM10 per hour. Those values extrapolated over the worst case op erating scenario of 24 hrs/day and 7 days/week

result in less then 0.8 tons of emissi ons per 12-month rolling time frame.

### Wolverine Power Supply Cooperative, Inc. Response to Comments Document Page 117 of 140 June 29, 2011

Comment : A comment was received stating that “F or EULIMESTONE, proposed permit does not include an operational limit on the maximum ann ual throughput of limestone. Limit is needed

to substantiate several calculat ions such as the efficiency of the fabric filter and the wind

erosion emissions calculati on, which are based on the am ount of limestone supply and usage/day.”

Response : There are no underlying regulations requiri ng fabric filter effi ciency and wind erosion calculations. As this proposed pr oject is at a facility which is a source category designated through rulemaking under Section 302(j) of the CAA, fugitive emissions must be analyzed as part of the PSD-BACT review. The special conditions for EULIMESTONE include opacity limits, a requirement to insta ll fabric filter control on colle cted exhaust streams, opacity monitoring requirements, and a requirement to implement a Fugitive Dust Control Plan upon operation of the equipment. All of these requirements fulfill BACT requirements. Opacity limits are specifically included in the definition of BACT. An emission limit of 0.00016 lbs PM per 1000 lbs of dry exhaust gas representing fabric filter cont rol of the material handling exhaust stream is BACT for processes of this nature. Fugitive emissions – defined under MAPCR 336.1106(l) as those em issions which could not reasonably pass through a stack, chimney, vent, or other functionally equival ent opening – meet the technological limitation

standard included in the BACT definition and are subject to work practice and operation standards as BACT. The Fugitive Dust Emissi on Control Plan itself is the work practice standard necessary to satisfy BACT.

Comment:

Is it true that Wolverine will have the la rgest fuel pile with no dust suppression?

Response: No, the proposed draft permit requires fuel pile s to use dust suppression. More specific

details of when and how often to use dust s uppression will be developed in the Fugitive Emissions Control Plan (FECP) before t he facility starts accepting fuels.

Comment: The Permit only contains an op acity limit for roads in the section on limestone handling and

thus fails to include enforceable BACT limits fo r truck traffic on all roads at the plant.

Response: The AQD included the particulate emissions fr om the increased truck traffic on all the roadways on the facility when it evaluated total particulate emissions from the facility. The evaluation showed that the total particulate em issions from the facilit y are not expected to

violate state and federal standards. In addition, the facility will have to comply with the FECP, which is authorized under the MD EQ State Rules 336.1371 and 336.1372.

### Wolverine Power Supply Cooperative, Inc. Response to Comments Document Page 118 of 140 June 29, 2011

H. Ancillary Equipment

Comment : Proposed EUAUXBOILER emission limits are in lb/ MMBtu. It is unclear how the source will

demonstrate continuous co mpliance as the monitoring associ ated with these requirements is stack testing every 5 years. Explain how the source will demonstrate compliance, or incorporate into the permit additional m onitoring and reporting requirements.

Response:

There is no continuous emissi ons monitoring required for t he auxiliary boiler since the operating time will be limited. Required record keeping of fuel certif ications and hours of operation along with stack testing to verify emission limits will be required to ensure compliance.

Comment: For EUEMGGEN the proposed emission limits t able does not include limits for SO2 and VOC. Please add, with appropriate monitoring, recordkeeping and reporting to the permit.

Response: The proposed draft permit for the EUEMGGEN em ission unit does not include limits for sulfur

dioxide. However it does include limits for t he sulfur content in the fuel, monitoring and recordkeeping of fuel supplier certificat ion records and hours of operation limit. When the emergency generator emissions were reviewed it was determined that BACT for an emergency generator (operating less than 500 hours per year burning fuel oil with a low sulfur content) was to limit only t he sulfur content of the fuel sinc e that is a limit which is more enforceable as practical manner. The fuel oil co mpany is required to do an analysis of the fuel and to certify it. This allows more frequ ent monitoring and recordkeeping of the fuel that

is burned.

The VOC emissions were evaluated to be about one ton per year for this size of a generator. Since hours of operation are lim ited, and the generator is ope rated with good combustion control techniques, it was det ermined that a VOC limit would not add any additional protection to health and the environment.

Comment: For EUFIREPUMP, the proposed emission limits t able does not include limits for CO, SO2, and VOC. Please add, with appropriate moni toring, recordkeeping and reporting to the permit.

Response: The proposed draft permit for the EUFIREPU MP emission unit does not include limits for SO2, CO, or VOC. However, it does include limits for the sulfur content in the fuel, monitoring and recordkeeping of fuel supplier certification records and hours of operation

limit. When the fire pump emissions were review ed, it was determined that BACT for a fire pump (operating less than 500 hours per year burn ing fuel oil with a low sulfur content) was to limit only the sulfur content of the fuel since that is a lim it which is more enforceable as practical manner. The fuel oil company is required to do an analysis of the fuel and to certify it. This allows more frequent monitoring and recordkeeping of the fuel which is burned.

### Wolverine Power Supply Cooperative, Inc. Response to Comments Document Page 119 of 140 June 29, 2011

The CO and VOC emissions were evaluated to be about a half ton per ye ar each. Since the hours of operation are limited and the generato r is operated with good combustion control techniques, it was determined that a CO a nd VOC limit would not add any additional protection to our health and environment.

Comment: For EUBLACKSTART, the proposed emission li mits table does not include VOC limits. Please add, with appropriate monitoring, re cordkeeping and reporting to the permit.

Response:

The VOC emissions were evaluated to be ab out one ton per year. Since the hours of operation are limited and the generator is operat ed with good combustion control techniques,

it was determined that a VOC limit would not ad d any additional protection to health and the

environment.

Comment: For FGCOOLINGTWR, the proposed permit does not include PM emission limits. Please add, with appropriate monitoring, reco rdkeeping and reporting to the permit.

Response: The cooling towers emissions are minimal and BACT was considered to be the use of drift

eliminators with a maximum drift rate of 0. 0005 percent or less. The RBLC was reviewed

and shows a number of entries of cooling towers at power gener ation facilities. The RBLC entries indicate a range of 0.001% to 0.0005% drift loss for MP10 emissions.

Comment: Some cooling towers use algecides to control the formation of algae and molds. This could

be a source that has not been considered and coul d emit VOC emissions.

Response: To the extent algae growth does occur in the cooling towers it will be controlled by the addition of an oxidizing biocide. Oxidizing biocides typically consist of chlorine and bromine compounds. These oxidizing bioc ides do not contain VOCs and do not form VOCs as a part of the oxidizing reactions. Us age of oxidizing biocides depe nds on the type of oxidizing biocide used, specific conditions and the level of fouling. There are a number of oxidizing

biocides which do not contain VOCs on the MD EQ-Surface Water Quality Division’s (SWQD) “Water Treatment Additives with the Rule 57(2) Minimum Toxicity Data Base for Aquatic Life”

list. Wolverine has stat ed that they will follow the MDEQ-S WQD guidelines regarding toxicity of water treatment additives as appropriate.

As stated on page 5-49 of the original application all VOC-re lated RBLC entries were for cooling towers at refineries. At refineries, t he cooling towers would be serving equipment in VOC service (equipment that proc esses, transfers, or contains a VOC or mixture of VOCs), such as cracking towers and distillation colu mns which would have a potential of leaking VOC into the cooling media. AP-42, Section 5. 1, lists a VOC emission fa ctor specifically for refinery cooling towers due to hydrocarbon leaks into the cooling water system. On the other hand the AP-42, Section 13.4, provides a meth odology for calculating PM emissions only from cooling towers in general. The coo ling towers at WCEV will not be serving any

### Wolverine Power Supply Cooperative, Inc. Response to Comments Document Page 120 of 140 June 29, 2011

equipment in VOC service. As a result, there is no basis to expect that VOCs will leak into the cooling water system and result in VOC emi ssions from the cooling towers at WCEV.

Comment: Is there any chlorine or other chemicals in t he water vapor plume from the cooling towers

and has this been studied?

Response:

Trace amounts of chlorine will be added to the cooling tower water to reduce algae growth on the tower equipment. Water evaporating from t he tower will be mostly pure, except for the small presence of dissolved solids, which will exit the tower in particulate form. The tower’s high efficiency drift eliminators will reduce thes e particulate emissions greatly. Technical studies on the fate of chlorine in cooling towe rs verify that the ma jority is consumed in

reactions that kill the bacteria in the water and only insignificant amounts will be emitted to

the air.

Comment: Several comments were received regarding the us e of water in the cooling towers and the effect that draining so much water from Lake Huron will have on the la ke level. Why does the steam need to be discharged to the air instead of used in a cogeneration process?

Response: The WCEV facility has been proposed to receive water, for th e cooling towers from a portion of that which the Carmeuse qua rry currently discharges into the creek running through the quarry property. Also, the facility has been designed to have zero liquid discharge (ZLD),

which means there will not be any water discharged into Lak e Huron. It will all be re-circulated back into the system.

Any steam generated is used in t he process of generating electric ity. The water going into the atmosphere is water vapor that results fr om evaporation from cooling the hot water prior to returning it to the system for recirculat ion. This is done to re-circulate the water continuously back into the system.



### I. Control Equipment

Comment: What securities/backups are required for emi ssion control equipment failures? Will the emission control equipment be on at all times? What will happen if emission levels rise

above the limit level? Will the boilers be required to shutdown, if that occurs?

Response: The purpose of the malfunction abatement plan is to prevent failures from occurring by implementing a schedule for main tenance on all control equipment.

FGCFB special conditions IV.1 and IV.2 of the draft permit requires the permittee to operate

the boilers at all times with the control devi ces listed. If for some reason, there is a malfunction of any of the control devices, t hen the appropriate actions as required in the

### Wolverine Power Supply Cooperative, Inc. Response to Comments Document Page 121 of 140 June 29, 2011

malfunction abatement plan (MAP) will be required to be implem ented and could result in shutdown of the boiler(s).

Comment: Why do you consider this proposed plant to be “clean” coal technology?

Response: MDEQ has not labeled the proposed plant to be ‘clean’ coal technolog y. However, Clean Coal Technology is defined in the Michigan Depart ment of Environmental Quality, Air Quality Division, Pollution Control Rule 336.2801(h) as any technology, including technologies applied at the pre-combustion, combustion, or post-combustion stage, at a new or existing facility which will achieve signific ant reductions in air emissions of sulfur dioxide or oxides of nitrogen associated with the utiliz ation of coal in t he generation of electr icity, or process steam which was not in widespr ead use as of November 15, 1990. The control equipment that WCEV has proposed to use are selective non- catalytic reduction (SNCR) to control NOx emissions, limestone injection into the CFB boiler and polishing scrubber to control SO2 emissions, sorbent injection to control mercur y emissions and fabric filter baghouse to remove particulates.

Comment:

Commenter asked if the NOx c ontrol for this facility is vi a an SNCR? What is an SNCR?

Response: Yes, the CFB boilers will use a selective non- catalytic reduction (SNCR) system for NOx control. In an SNCR system, a reagent (ammonia or urea) is injected into the flue gas in the furnace of the boiler within an appropriate temperature window. The reagent reacts to reduce NOx into nitrogen and water.



### J. Start-up and Shut-down Emissions

Comment: Why does a base load facility need so m any hours to start-up and shutdown?

Response: The facility is permitted to operat e continuously. However, ther e are expected times that the facility will need to shutdown for maintenance. It is also likely that t he facility may encounter some occasional unexpected shutdowns. The dur ation of each startup and shutdown as well

as emission estimates associated with unst eady state operation were compared to the

manufacturer’s data and information from simila r sources and found to be acceptable. In addition, the increase in emissions during st artup and shutdown conditions was included in the modeling analysis and maximu m impacts are still below the federal health standards. The company is also required to submit a pl an that describes how emissions will be minimized during startup and s hutdown conditions before oper ation of the equipment is

allowed.

### Wolverine Power Supply Cooperative, Inc. Response to Comments Document Page 122 of 140 June 29, 2011

Comment: The Draft Permit erroneously exempts Wo lverine from NOx and CO BACT limits during periods of startup, shutdown, and maintenance.

Response: The commenter’s claim that the draft permi t exempts startup/shut down operations from BACT limitations is incorrect. The permit cont ains BACT emission limits for NOx and CO in units of pounds per hour that are applicable each hour the boile r operates, including periods of startup and shutdown. When measuring the NOx concentrati on in parts per million (ppm)

with a continuous emission moni tor system (CEMs), a false high indication for NOx occurs when very low CO 2 concentrations are measured. This data is used to calculate NOx in pounds per million Btu (lb/MMBtu) emission rate s during startup and shutdown operation. The NOx emission rate equations are found in Method 19, Equation 19-7 of 40 CFR Part 60, Appendix A and Formula F-6 in Section 3.2 of 40 CFR Part 75, Appendix F. Mathematically, the last term in the equation causes the lb/MMBtu emission rate calculation to approach infinity as the measured diluent value approac hes a value representativ e of zero heat input (i.e. 0.0 % when CO 2 is the monitored diluent). Thus, dur ing periods of boiler startup and shutdown when the heat input and CO 2 concentrations are low (or high as would be the case

if O 2 were being measured), the NOx lb/MMBtu em ission rates become artificially inflated. This is also the reason why the New So urce Performance Standards (NSPS) for NOx emission limit utility boilers, namely, 40 CF R Part 60, Subparts A and Da, Section 60.48Da(c), does not apply during periods of bo iler startup, shutdown or malfunction. This same response also app lies to CO emissions.



### K. Annual Emissions

Comment : Will the individual emissions of the Wolverine plant be less than or mo re than existing coal plants in Michigan? In what relationship?

Response: Size for size, the proposed coal plant will emit less emissions than exis ting coal plants as a

result of the best available control technologies that have been proposed.

Comment: On September 18 th , 2008, at a Presque Isle County Planning Commission meeting, Lee Sprague stated that “the MDEQ has not licensed a coal plant si nce 1984, they do not have the experience and expertise on hand to deal wi th even one permit, and they are bombarded

with five of them.” Is that true?

Response: The MDEQ disagrees with the commenter. Even though there has not been a “new” coal plant permit issued in recent years, t he AQD has had many permit applications for modifications at existing plant s that has required us to k eep up to date with what is happening around the nation with new and modifi ed applications. The AQD participates on monthly calls with EPA Region 5 to discuss te chnologies, current rule revisions, new rules, recent court actions, BACT analyses , test methods, and policies.

### Wolverine Power Supply Cooperative, Inc. Response to Comments Document Page 123 of 140 June 29, 2011

Comment: The generating capacity of Wolverine Po wer would be 600 megawatt, and the proposed generating capacity of Consumers Energy in Bay City would be 930 megawatt. Why is Wolverines plant proposing it would emit 820 pounds more of nitrogen oxide into the air than the Consumers Energy plant and Wolv erine is 330 MW less capacity?

Response:

It is not clear what limits the commenter is refe rring to. Consumers Energy has a permit limit of 409.5 pounds per hour and Wolverine is pr oposing 281.1 pounds per hour, for NOx.

Comment: Where and when has a plant of this size been permitted and are emissions data on record?

Does it use like fuel?

Response: There are a number of comparable existing plant s with available emissions data. Information on the units was gathered including the unit charac teristics, primary an d secondary fuels, the permit date, the permit limits, the type of pollution control equipment and the level of emissions. The most similar CFB boilers (wit h the same type of controls) are Units 1 and 2 at JEA Northside Generating Fac ility located in Jacksonville, Flor ida. They are permitted to use coal and pet coke as fuel in the boilers, as Wolverine is proposi ng. The following table compares the JEA Northside facili ty with that of Wolverine.

Pollutant Wolverine JEA Northside

SO2 0.06 lb/MMBtu (30-day), 0.05 lb/MMBtu (12month), 303 pph (24-hr) 0.15 lb/MMBtu (30 day), 0.20 lb/MMBtu (24-hr)

NOx 0.07 lb/MMBtu (30-day), 281.1 pph (24-hr) 0.09 lb/MMBtu (30-day)

H2SO4 0.003 lb/MMBtu (24-hr) 1.1 pph

PM 0.010 lb/MMBtu 0.011 lb/MMBtu

PM10 0.026 lb/MMBtu, 78.8 pph 0.011 lb/MMBtu **

PM2.5 0.024 lb/MMBtu, 72.7 pph excluding su/sd, 54.5 pph during su/sd No limit

CO 0.15 lb/MMBtu (30-day), 744 pph (24-hr) 0.22 lb/MMBtu (24-hr)

**Limit is listed in the permit as PM/PM10.

### Wolverine Power Supply Cooperative, Inc. Response to Comments Document Page 124 of 140 June 29, 2011

Comment : There were some incorrect emissions in the MD EQ Fact Sheet. They were as follows: VOCs were incorrectly calculated usi ng the proposed pound per hour VO C limit of 17.8 rather than

the intermediate load limit of 0.0066 lb/ MMBTU. The lb/MMBtu limit effectively and enforceably limits the maximum VOC emissions from the CFB boilers to 122.6 tons/year. The current proposed limit is 33.3 tons/year less than the valu e listed in the Fact Sheet.

PM10 allowed emission was not updated in the Fact Sheet to reflect the final proposed

PM10 limit of 0.026 lb/MMBtu. This PM10 lim it was adjusted during the permit application review process based on the 112(g) analysis for t he CFB boilers. As a result of this change,

the allowed PM10 emissions from the CFB boile rs were reduced from 717.0 tons/year to 690.1 tons/year. This limit is 26.9 tons/year less than the num ber listed in the Fact Sheet.

Response:
MDEQ has taken note of the discrepancy. However, as noted earlier, pages 3 -10, intermediate load limits are being removed from the permit.

Comment: There are currently 88 operating coal-fired po wer plants in Michigan emitting 2,488 pounds of mercury, 91 million tons of Carbon Dioxide, and 300,000 t ons of Sulfur Dioxide annually.

Additional annual emissions from 8 new coal plants include: 232 pounds of Mercury, 13 million tons (or more) of Carbon Dioxide, 6776 tons of Sulfur Dioxide, and 2463 tons of additional particulate matter (soot).

Response: MDEQ disagrees with the commenter. The MD EQ Mercury Strategy Staff Report in 2008 reported 21 plants. There hav e not been any new coal-fired power plants issued since the report was released. The report can be downloaded at: http://www.michigan.gov/documents/d eq/MDEQ_MSWG_FinalReportJan2008.pdf_222 256_7.pdf

. The source of the commenter’s inform ation was not provided for MDEQ to determine the correctness of the figures.

Comment:

There are several contaminants emitted such as HCl, HF, and the presence of chlorine in the fuel oil for startups that coul d indicate formation of dioxins. Combination with 20% wood

waste also could contribute to dioxin emissi ons. There is no discuss ion or determination of

whether control of dioxins shoul d be considered. Wood waste s hould also be prohibited that has been painted or c hemically treated.

Response: Dioxin formation is a by-product created du ring incineration, uncont rolled burning, and in some industrial processes. Ju st as combustion allows for form ation of dioxins it also can destroy dioxins. The proper combustion temper ature, combustion time, turbulence, and then quickly cooling the combustion gases minimizes the presence of certai n metals known to promote dioxin formation. Wolverine will us e good combustion control practices in the CFB

boilers to minimize dioxins.

### Wolverine Power Supply Cooperative, Inc. Response to Comments Document Page 125 of 140 June 29, 2011

Comment : When looking at real-world operations, CFB boile rs do not emit less NOx than PC boilers. In fact, the opposite is the case. This is true whether one looks at unc ontrolled emissions or

controlled emissions.

Response : Commenter did not provide any spec ific examples. NOx present in flue gas is a result of two

sources: the oxidation of nitr ogen compounds in the fuel (fuel NOx) and the reaction among nitrogen and oxygen in the combustion air (ther mal NOx). CFB boiler combustion is a newer technology that pr ovides greater fuel flexibility and more efficient heat transfer. The combustion temperature of a CFB boiler is a few hundred degrees lower than a PC boiler

which favors lower NOx formati on because the oxidation of t he nitrogen in the fuel is suppressed.

Comment : Emission limits for NOx, CO, SO2, and VOC in the proposed draft permit differ from that proposed in the application.

Response: The Fact Sheet states that during the permit review process, the permittee submitted new information requesting different emission limits. The emissions limits, as presented in the draft permit for public review, reflect the most current information used in the application review. The MDEQ reviewed all emission limits and determined they meet all state and federal regulations.



### L. Monitoring

Comment The draft permit does not require PM CEMs , making the alleged BACT and MACT limits

unenforceable.

Response:

A PM CEMS measures filterabl e PM only. The limits in the permit for particulate matter include both filterable and condensable particulate.

Comment: How will compliance with the emission li mits in the permit be demonstrated?

Response: There are several ways in which emissions from a process may be monitored: stack sampling, continuous emissions monitors (CEMS), and continuous opacity monitoring (COMS).

Periodic stack tests are a required part of the annual Relative Accuracy Test Audits of the Continuous Emission Monitoring Sy stems at the facility. The stack testing requirements of

the Permit to Install will also be included in a Renewable Operating Permit which the facility

### Wolverine Power Supply Cooperative, Inc. Response to Comments Document Page 126 of 140 June 29, 2011

must obtain. Also, General Condition No. 13 provides for additional stack testing not specifically included in the permit.

For air emissions, the act of sample collect ion involves the use of specialized equipment operated over an extended time period (usually three one-hour samples). Many process and control equipment variables must also be moni tored during the stack test because of their possible effects on the air emis sions. These may include fuel mixture content, steam output, startup/shutdown conditions, ex haust gas variables (moisture content, temperature, flow rate), and control equipment operating parame ters. This sampling process provides a “snapshot” of the process emis sions under known operating conditions. Three collected samples are then analyzed for each pollutant.

One objective of stack testing is to identify po llutant emission rates at “worst case” operating conditions. Operating parameters for the stack test are delineated in the stack test plan. Another objective is to identify measurable process and control system operating parameters which can be used to conclude that a process is operating within the allowed emission limits. For many small facilities of various types, a si ngle stack test is conduc ted upon issuance of a Permit to Install. For many major sources of air emissions, stack testing is repeated every five years under a Renewable Operating Permit.

In addition to stack testing, Conti nuous Emission Monitoring Systems for NO
x , CO, SO 2 , and exhaust gas oxygen content are required. Also, a Continuous Opacity Monitoring System (opacity indicates the presence of particulate ma tter) is required. These systems provide an indication of efficient and proper operation of t he process, which means that emissions of all pollutants are reduced.

All records from stack testing and CEM system s must be kept on site for five years to demonstrate compliance with emission limits during site inspections from the district office.

Comment:

Where are the stack emission cont rols located on/in the stack?

Response: It is unclear what the commenter is asking. There will be continuous emission monitoring (CEM) devices and continuous o pacity monitoring (COM) device which are typically located after the control equipment and before the stack. These devices cont inuously monitor the amount of pollutants in the exh aust gases before the ex haust leaves the stack. There will be CEM devices for Nitrogen Oxide (NOx), Sulfur dioxide (SO2), and mercury. The COM will continuously monitor opacity coming from the stack.

There will also be pollutant emission controls, usually referred to as “control equipment” for NOx, sulfur dioxide SO2, and mercury. T he NOx control equipment proposed is selective non-catalytic reduction (SNCR), it will be loca ted after the CFB boiler and will reduce NOx emissions in the exhaust gases; to control SO2 emissions, li mestone injection will occur in the CFB boiler and a polishing scrubber will fo llow the SNCR; sorbent injection system to control mercury emissions will follow the polis hing scrubber; and a fabric filter baghouse to remove particulates will follow the sorbent injection system.

### Wolverine Power Supply Cooperative, Inc. Response to Comments Document Page 127 of 140 June 29, 2011

Comment:

The consultant for Wolverine commented t hat an inadvertent error was made when formatting the proposed permit for public commen t. During permit development, the MDEQ had language for Special Conditions relating to a schedule for the installation and operation of continuous emission monitoring (CEM) and emi ssion testing of the new CFB boilers which provided, “Within 90 days of commencing comme rcial operation, as defined in 40 CFR 72.2,

but no later than 12 months afte r commencement of initial star tup of each boiler included in FGCFB.” That language remains in proposed condit ions VI.6, 8, 9, and 11 -16. However, it has been omitted from proposed conditions V. 3 – 9 and replac ed with a requirement to conduct stack testing “within 180 days a fter commencement of initial startup...”

Response: The MDEQ disagrees with commenter. The draft special conditions were reviewed and accepted by Wolverine before the comment perio d. MDEQ will leave the language as it was proposed during the comment period.

Comment: Will the plant personnel be qua lified or certified to perform the modification, installation, periodic maintenance, correctiv e maintenance, and routine ca librations of the monitoring

devices? What standards/criteria are used in the certification? Who certifies the technician?

Response: Generally when continuous emission monitoring devices ar e installed at a facility, plant personnel will operate and maintain the monitors . The monitors are required to be calibrated on a daily basis, so it is usually plant per sonnel who are assigned the calibration and maintenance functions. Plant per sonnel are trained in the op eration and maintenance of the

continuous emission monitors.

With regard to standards used in the certific ation of the monitors , the EPA has published performance specifications which must be followed in the cert ification of the monitors. These

standards must be used in the installa tion and operation of the monitors.

In addition to the daily calibration of the m onitors, the monitors are required to have calibration gas audits (CGAs) on a quarterly basi s, and have relative accuracy test audits (RATAs) on an annual basis. The MDEQ parti cipates in the RATAs and also reviews maintenance logs on the monitors.

The specific requirements for the installation calibration and maintenance of the continuous

emission monitors are contai ned in special condition numbers VI.2 and VI.3 for the CFB

boilers.

Comment: How can we trust a company to do self monitoring?

Response: The facility is a major source of emissions and is required to obtain a Renewable Operating Permit (ROP). The ROP requires the company to certify that they are in compliance with the terms and conditions of their permit semi-annu ally. Self monitoring is therefore not discretionary. The company will show complianc e with their emission limitations through the

use of continuous emis sion monitors, recordkeeping, and material analysis. Continuous

### Wolverine Power Supply Cooperative, Inc. Response to Comments Document Page 128 of 140 June 29, 2011

emission monitors are subject to federal requi rements which require calibration as well as

certification that the conti nuous emission monitors are calib rated and working properly.
MDEQ staff will review this information and will verify that calibrations are done correctly by doing their own on site calibrations.

Records for emissions and process parameters will be stored and retained for at least five years and is shared with AQD. AQD has the ability to perform an independent analysis of the facility at any time.

The responsible official of any facility which has an ROP, can be criminally prosecuted, if the responsible official falsified information, or vi olated the terms and condi tions of the operating permit.

Comment: Who is to monitor the control system to ensur e the proper operation and maintenance? Will the monitoring be continuous and w ill records be kept on file?

Response: The company will be required to develop a pr eventative maintenance plan for the control system which includes the manufacturer ’s recommended guidelines. The AQD is responsible for approving this plan and overseei ng its implementation. The company cannot operate the equipment until the pl an is approved. T he approved plan will be kept on file at the AQD Gaylord District Office and at the facilit y. When the AQD district personnel go to the facility for an inspection t he company will be required to allow the AQD to view any

records needed.



### M. Compliance Testing

Comment: Why is Wolverine allowed to choose their ow n stack testers? Shouldn’t the DEQ do the testing?

Response: Due to the large volume of testing required to analyze the air cont aminants potentially being emitted from facilities all over Michigan, the MD EQ does not perform emissions testing. It is the responsibility of the owner of the facility to contract a ce rtified tester and conduct and pay for emissions testing. However, the AQD’s Te chnical Programs Unit reserves the right to witness the testing and thoroughly reviews te st methods and reports before approving or denying results submitted by the tester.

Comment: The testing requirements in the draft permit ar e written in a very vague way referring to Appendix A and/or a test plan submit ted to the AQD. You should spell out exactly what test method you’re going to require to be used.

Response: The testing condition requires that a complete te st plan be submitted 30 days prior to testing. The final plan must be approved by the AQD prior to testing. The testing methods are

### Wolverine Power Supply Cooperative, Inc. Response to Comments Document Page 129 of 140 June 29, 2011

proposed in the test plan, since the met hods could change before the stack test is performed. If AQD does not agree with the te st methods proposed then the permittee runs the risk of performing an unacceptable compliance te st. This type of mistake is costly for the permittee, as they will still be expected to pe rform the compliance te st with an approved

method.

Comment: The draft permit omits averaging times for numer ous pollutant limits. Provisions allowing later determinations as to test protocols, time periods, and operating scenarios are not practically enforceable.

Response: AQD permits normally do not contain averagi ng times for pollutant limits that will demonstrate compliance through stack testing. The test plan is required to be submitted 30 days prior to testing which will specify the test protocols, time periods (averaging times), and operating scenarios. This allows flexibilit y to choose the optimum and best methods.

Comment: There are no provisions for future stack test s for toxic air contaminants. There is much uncertainty concerning the act ual emission of toxic air cont aminants. Testing for these pollutants must be performed before a permit is issued and annually thereafter. Testing must be conducted under worst case operating conditions. There is no monitoring for all pollutants emitted from the stack, so MDEQ doesn’t know what’s comi ng out of the stack.

Response: As a part of the application review, AQD st aff evaluated the generation, and potential emission, of toxic air contami nants. This evaluation included mu ltiple fuels and fuel blends. The applicable regulations governing this re view are; MAPCRs 336. 1224 through 336.1232, and certain standards promulgated under Section 112 of the Clean Air Act. Individual toxic air contaminants testing/monito ring requirements were included as required by the applicable regulations. In some circumstances simila r toxic air contaminants were grouped under a surrogate limit designed for compli ance with the applicable regulati ons. All inclusive toxic air contaminants testing/monitoring requirements are not required under any of the applicable regulations.



### N. Enforcement

Comment: What process will be in place to ensure t hat the facility will not go above the allowed

emissions? In the future if and when new information changes standards, how will enforcement change?

Response: Changes will be addressed as the regulations dictate. Often ther e is a lead time allowed to implement new standards to allow for design and construction. Em ission monitoring using Continuous Emission Monitors (CEMs), site inspections, and the Ma lfunction Abatement Plan (MAP) will all provide a way to measure compliance with allowed emissions. Also,

### Wolverine Power Supply Cooperative, Inc. Response to Comments Document Page 130 of 140 June 29, 2011

public reporting of emission concer ns is an important part of comp liance, as it alerts the AQD to investigate problems.

A MAP must include the following component s as described in Rule 336.1911: a preventative maintenance program to minimize equipment malfunctions or failures, identify the process and emissions contro l equipment operating variables that will be monitored to detect a malfunction, and description of the correct ive activities, methods , and/or operational changes to quickly restore nor mal operating conditions.

Comment: How many times has a MDEQ permitted coal-fired power plant violated its air permit? Be specific with numbers and types of violations. How does violator correct air permit violations? Do they clean environment or pay a fine?

Response: Air Quality Division (AQD) Field Section staff are located in eight district offices and two field offices. Additional investigatory and compli ance support res ponsibilities are assigned to staff in the central Lansing office. Together, each year these AQD staff are responsible for conducting approximately 1,000 source inspections, invest igating over 1,000 citizen complaints of air pollution, quality review ing and assuring approximately 2,000 emission inventory reports, and sending out in excess of 500 Violation Notices. These AQD staff are responsible for evaluating the ad equacy of the compliance programs to assure and maintain compliance, conducting oversite of over 200 st ack tests and 750 in-stack monitors, resolving cited violations, and handling issuance, renewa ls and modifications for over 500 Title V

Permits.

When, as a result of compliance assurance and source inspections, a vi olation is identified,

staff advise the source of the vi olation, which is documented in a violation notice (previously

identified as letters of violati on). The AQD requires the source to take corrective action to resolve the violation and implement a correctiv e action plan identifying how the source will take preventative action to avoid r epeating the cited violation.

The AQD reviews the magnitude, gravity, and frequency of eac h violation to determine if

formal administrative action should be implemented to refl ect and make enforceable the corrective action and enhance compliance assuranc e. Such an enforceable corrective action plan may be implemented promptly at the source, may be implemented and made enforceable under terms of the air use permi t and/or may be implemented through an

enforcement document such as an administrative order.

If a violation is deemed significant, the source is contacted by AQD’s enforcement staff and a meeting is convened to discuss the cited violation and formalize a legally enforceable corrective action plan which is state and federally enforceable. In such an enforcement

document a corrective action is required to be implemented, a se ttlement amount is required, and future violations may be subj ect to monetary sanctions.

The authority to assure compliance begins at the federal governm ent through the USEPA. The USEPA has delegated to the state both the requirement and the authority to write air use permits and enforce the federal Clean Ai r Act Amendments (Act) requirements under the Natural Resources and Environmental Protection Act, Part 55 (Part 55) and the Rules promulgated under the Act. The Act and t he Rules are incorporated into the State

### Wolverine Power Supply Cooperative, Inc. Response to Comments Document Page 131 of 140 June 29, 2011

Implementation Plan (SIP), wh ich has been approved by the USEPA. Additional federal requirements have been conditionally delegated to the State. The Stat e, through Part 55, has authority to issue permits, to enter orders, and to collect fines and penalties to assure compliance is attained and maintained, to preser ve the health, safety and welfare of the

citizens as well as the natural resources.

Comment: The draft permit provisions t hat reference actions, steps, cont ent or requirements contained in documents that fall outside of the permit are not enforceable. The s pecific stated concern is two permit references to compliance with manufacturers’ specificat ions. Draft Permit

EUEMGGEN SC III.1 and EU FIREPUMP SC III.1.

Response:

The conditions that reference m anufacturers’ specificat ions are from the federal New Source Performance Standards (NSPS). One of the underlying applicable requirements for the special condition is 40 CFR 60.42 06 which clearly states that “Owners and operators of stationary CI ICE must operate and maintain stationary CI ICE that achieve the emission standards as required in §§60.4204 and 60.4205 according to the manufacturer's written instructions or procedures dev eloped by the owner or operat or that are approved by the engine manufacturer, over t he entire life of the engine.”

Comment: The word “satisfactory” is too subjective to be practically enfor ceable. The draft permit must

be rewritten to delete all instances in wh ich the term “satis factory” is used.

Response: The term “satisfactory” is used to allow for fl exibility among different facilities. The MDEQ district inspector will review source records an d the manner in which they are kept, to ensure the records are demonstrating compliance with the special conditions in the permit.

Comment: A reference to operation of the turbine gen erator EUBLACKSTART emission unit with good pollution control practices is vague and unenforceable.

Response:

The condition that references good pollution control practices is from the federal New Source Performance Standards (NSPS). One of the underlying applicable requirements for the special condition is 40 CFR 60.433 3 which clearly states in t he NSPS that “You must operate and maintain your stationary combustion tu rbine, air pollution control equipment, and monitoring equipment in a mann er consistent with good air pollution control practices for minimizing emissions at all times includi ng during startup, shut down, and malfunction.”



### O. Rules and Regulations

Comment: Emission limit requirement for the CFB boilers is missing for 40 CFR Part 60, Subpart Da which requires a 95% SO2 emissions reduc tion based on a 30 day rolling average.

### Wolverine Power Supply Cooperative, Inc. Response to Comments Document Page 132 of 140 June 29, 2011

Response: This requirement is an “OR” requirement. T he regulation states that the emission unit must comply with 40 CFR 60.43Da(i)(1)(i) OR 40 CFR 60.43Da(i)(1)(ii). The draft permit requires compliance with 40CFR 60.43Da(i)(1)(i), which is that SO2 must be less than 1.4 lb/MW-hr, as determined on a 30-day rolling average.

Comment : How do the air quality regulations for power pl ants in Michigan compare with those of other states, particularly with those adjacent states?

Response:

All states must follow the federal rules and re gulations which are cons istent across states

and their own state rules. T hose regulations are Prevention of Significant Deterioration (PSD), New Source Performance Standards (NSPS), National Emission Standards for Hazardous Air Pollutants (NESHAP), and Maximu m Achievable Control Technology (MACT).

All states have their own rules which are similar and cannot be any less stringent than federal rules and regulations.



### P. Malfunction Abatement Plan (MAP)

Comment: The condition requiring a malfunction abatem ent plan (MAP) also allows changes in the malfunction abatement plan (MAP) with the approval of the district supervisor. This allows the DEQ to make important changes to t he permit without informing the public.

Response: Changes in the MAP allow for flexibility and qui ck response to modifications in the operation of the plant which do not meet the definition of modification and therefore do not require a permit or public comment.

Comment: The draft permit references a yet-to-be- developed malfunction abatement plan (MAP) and fugitive emissions control program (FECP) without specifying the contents of these. Consequently, the conditions re ferencing the MAP and FECP ar e not enforceable and violate the requirements of the CAA.

Response: The MDEQ accurately informed the public during the public hearings and correctly referenced development of a MAP and FECP to be working documents referenced from within the permit but which can be fine tuned subsequently. It is standard practice to attach MAP and FECP documents to permits to allow in spectors and district s upervisors to require

additional modifications of thes e working documents once a fac ility is constructed, and during the time that it continues to operate t hereafter. It is in the public and environment’s

best interests to retain these documents as refe rences within the permit and the specifics of

the MAP and FECP to be fine tuned over time to reflect changes in roadway maintenance and dust control techniques, equi pment degradation and process refinements to assure protective measures are implemented and maintained in the best fashion. R 336.1911

### Wolverine Power Supply Cooperative, Inc. Response to Comments Document Page 133 of 140 June 29, 2011

(“Rule 911”) was most recently updated in March 2002, and has been part of the State Implementation Plan approved Rules since at l east January 1980. R 336.1911(2) identifies in detail the minimum requirements of an a cceptable MAP, which mu st be present before approval and with which it may practically enforceable.



### Q. Emergencies and Safety Concerns

Comment:

Who should I contact to r eport a pollution emergency?

Response: In addition to your local police and fire dep artments, you may call the Pollution Emergency Alert System (PEAS) at 1-800-292-4706. This telephone number is operated by MDEQ and is staffed 24 hours per day. Information received by the PEAS operator is quickly forwarded to the appropriate agencies.

Comment: What types of accident al releases does the air-use permit address?

Response: A facility is required to comply with all per mit conditions, including emission limits, at all times. General Condition No. 7 requires the fac ility to notify the District Supervisor, AQD, of abnormal conditions or malfunctions resulting in certain types of emissions in excess of a standard or limitation lasting more than one h our. This condition pl aces an additional burden on the facility to investigate and self-report malfunctions th at cause excess emissions. Specifically, the facility is requi red to give the AQD a written su mmary of the actions taken to correct and prevent recurring malfunctions. T hese actions become a par t of the facility’s preventive maintenance and malfunction abatement plan.

Comment: What is being done to address accidental releases?

Response: The federal Clean Air Act require s that many facilities file risk management plans (RMPs)

with the U.S. Environmental Protection A gency (U.S. EPA) and work with the local emergency planning committee to ensure response plans are in place in the event of an emergency. Local governments and local emerg ency response entities, such as fire and police departments, have primary responsibility for first res ponse during emergencies. MDEQ works with the primary responders in a support role during emergencies. The company has developed an emergency preparedness plan with local officials, which must be continuously maintained and updated annually, and has a RMP on file with the U.S. EPA.

Air-use permits ensure that worst-case air em issions from process operations meet the appropriate air pollution control requirements and health protective limits. AQD’s primary responsibility is to ensure that a facility comp lies with all applicable control technology and

health standards. Permit condi tions require that a facility properly install, operate, and maintain production and control equipment and require monitoring and recordkeeping of critical parameters to ensure that proper equipment operation is maintained. Also, permit

### Wolverine Power Supply Cooperative, Inc. Response to Comments Document Page 134 of 140 June 29, 2011

conditions require the installation of specif ic safety devices and require the periodic inspection of equipment for wear and deteriora tion. Once a permit has been issued, AQD makes periodic inspections and/or requires periodi c stack testing to determine whether or not the facility is operating in comp liance with its air-use permit. The draft permit conditions for this specific modified process include variou s monitoring, recordkeeping, reporting, and equipment/operational requirements in order to ensure compliance with emission limits. When violations are found, AQD takes enfor cement action and makes certain they are addressed and corrections made promptly.



### R. Public Participation Process

Comment:

How soon after the end of t he comment period will the AQD make a finding and issue a permit to install and operate?

Response: Any action on the proposed permit by MDEQ will occur after su fficient time to review and address all comments received during the comm ent period. Recognizi ng that the magnitude of this application far exceeds the average applicati on this will likely be a lengthy process. Previously identified inte rested parties will receive notice of a final action.

Comment: There is no ability of the public to have input on the adequacy of prop osed pollution controls.

Response: The primary purpose of the public comment peri od is to allow the public an opportunity to review the proposed project and provide input. Further, MDEQ posted all permit applicant submittals on the internet to better provide th e public an opportunity to review all information and provide input.

Comment: The notice of hearing does not mention the re lease of mercury from the proposed plant nor

does it take into consideration cumulative im pacts to human health from the combination of pollutants to be released.

Response: The notice of hearing is only required by the Natural Resources and Environmental Protection Act, Act 451 of 1994, Pa rt 55, Section 5511(3)(b) to in clude criteria pollutants that have been determined to increase significantly and the air impacts associated with the increase. Mercury is not a criteria pollutant so it was not listed in the notice of hearing. However, mercury, the air impac ts and the detailed review the MDEQ did was included in the Public Participation Documents for Wolverin e Power Supply Cooperative, Inc., Permit Application Number 317-07.

### Wolverine Power Supply Cooperative, Inc. Response to Comments Document Page 135 of 140 June 29, 2011

Comment: Quoting your own documents (MDEQ’s), “It has been preliminarily determined that the proposed installation of the fa cility will not violate any of the department’s rules nor the national ambient air quality standards.” W hat is the point of the public hearing?

Response: The permit conditions reflect t he rules and laws that the fac ility must operate under. The draft permit itself is the preliminary determi nation. The purpose of the public participation process is to obtain input on the preliminary det ermination from all affected parties, including the applicant and general public. This helps the decision-maker to make a more informed final decision on the permit application.

Comment:

Residents of Ontario should be asked for thei r approval of the new coal plant, since

emissions will affect them too.

Response: The following recipients received the draft permi t to install and they were copied on the letter to Wolverine referencing when the public comment period for the proposed PSD source would begin: Mayor Beach Hall, City of Roge rs City; Ms. Susan Rhode, Presque Isle County Clerk; Honorable Laurel Broten, Ontario Misn istry of the Environment; Mr. Mike Moroney, Ontario Ministry of the Environment; Ms. Pame la Blakley, U.S. En vironmental Protection Agency, Region 5; Ms. Laura Co ssa, U.S. Environmental Prot ection Agency, Region 5; Mr. Jim Warner, Minnesota Pollution Control; Mr . Jeff Hanson, Wisconsin Bureau of Air Management; Ms. Laurel Kroack, Illinois EPA; Mr. Steve Blaser, Office of Air Quality IDEM; Mr. Robert Hodanbosi, Ohio EPA; Ms. Joyce E. Epps, Pennsylvania Bureau of Air Quality Control; Mr. David Shaw, New York Departm ent of Environmental Conservation; Mr. John Bunyak, Isle Royale National Park Federal Land Manager Isle Royale National Park Superintendant; Ms. Sandra Silva, Seney Nati onal Wildlife Refuge Federal Land Manager; Seney National Wildlife Refuge Manager; an d Ms. Janis Denman, MDEQ. Anyone is allowed to make comments on the proposed ne w plant during the comment period. The approval or denial of a draft permit to install is not based on a popularity vote, but rather information supporting stat e and federal regulations.

Comment: Concern was expressed that a single non-elected official has the power to approve a permit.

Response: Previous to Executive Order 1991-31, ai r use permits have been approved by the Air

Pollution Control Commission. The Air Pollu tion Control Commission had been given the authority to approve air use permits. Exec utive Order 1991-31, which was signed by Governor John Engler on November 8, 1991, abolished the Air Pollution Control Commission and assigned their responsibilities to the Director of the Department of Natural Resources.

Included in that transfer of re sponsibility was the approval of air use permits. Executive Order 1995-18, signed by Governor John Engler on July 31, 1995, created the MDEQ. The Air Quality Division was moved to the MDEQ. The powers of the director of the DNR as they related to approval of environmental permits we re transferred to the Director of the MDEQ or the Director’s delegated decision maker. Approval of pe rmits is being done in accordance with these executive orders, which prescribe t hat one individual has the authority to approve

### Wolverine Power Supply Cooperative, Inc. Response to Comments Document Page 136 of 140 June 29, 2011

a permit. Even though one person is responsible for approving the permit, the technical review is still the same, and the permit has the same opportunity for public review and input

that existed with the Air Pollution Control Commission.

Comment: How can the decision be appealed?

Response: Any person may appeal the perm it decision as specified in the Natural Resources and Environmental Protection Act, Act 451 of 1994, Section 5505(8), which states:

Any person may appeal the issuance or denial by the department of a permit to install, a general permit, or a permit to operate authorized in rules promulgated under subsection (6),

for a new source in accordance with section 631 of the revised judicature act of 1961, Act No. 236 of the Public Acts of 1961, being se ction 600.631 of the Michigan Compiled Laws.

Petitions for review shall be the exclusive means to obtain judicial review of such a permit and shall be filed within 90 days after the final permit action, except that a petition may be filed after that deadline only if the petition is based solely on grounds arising after the deadline for judicial review. Such a petition sha ll be filed no later than 90 days after the new grounds for review arise. Appeals of permi t actions for existing sources shall be in accordance with section 5506(14).

In addition, any person may file an action in a court of competent jurisdiction on a permit or

consent order.

S. Miscellaneous

Comment:

Will Wolverine be able to commence construction based on this permit?

Response: Yes, if the permit to install is appr oved then Wolverine will be able to commence

construction.

Comment: Has anyone from the DEQ that is involved in this permit visited the proposed site?

Response: Yes. All AQD staff that attended the hearing vi sited the proposed site. In addition, the AQD Gaylord District Office Inspector responsible fo r inspecting the facility is familiar with the area

and the site.

Comment: What is the AQD required to know about t he surrounding property use and what is their procedure for gathering and evaluating this information?

### Wolverine Power Supply Cooperative, Inc. Response to Comments Document Page 137 of 140 June 29, 2011

Response: The location of any facility is an issue addressed by local government thro ugh the planning and zoning processes. The Air Quality Divisi on does not control the selection of sites for industrial facilities nor does it have jurisdiction over local zoning issues. Site selection is done by the permit applicant. A site assessment is conducted by Air Quality Division staff as a part of the permit review process and air pollution impacts are reviewed.

Comment: Does the State prefer or enc ourage the redevelopment of indus trial land rather than to industrialize and take out of production agricultur al land? Is the State persuaded by specialinterest groups to make this decision?

Response: As a regulatory agency, the Ai r Quality Division cannot exercise non-technical discretion in the issuance of air use permits. The permit review process is a technical review of the proposed air pollution source and issuance of the permit is based solely on expected compliance with all applicable state a nd federal rules and regulations.

Comment: Shouldn’t the residents have a right to decide if this plant should go here?

Response: There is no legal mechanism which allows for popular votes on such proposals. Both the state and federal air pollution c ontrol laws are established by the legislative process and any changes to the regulations must go through this pr ocess. These laws are in place to protect public health and welfare. The role of the AQD is to implement the laws.

Comment: Consideration of this permit shoul d not be made until a popular vote is taken. The majority of the people believe the emissions from the plant will cause unreasonable interference with the comfortable enjoyment of life and property as stated in General Condition No. 6 of the draft permit terms and conditions.

Response: There is no legal mechanism which allows for popular votes on such proposals. Both the state and federal air pollution c ontrol laws are established by the legislative process and any changes to the regulations must go through this process. The role of the AQD is to implement the laws.

General Condition No. 6 of the fi nal permit specifica lly states that oper ation of the proposed process shall comply with Rule 901. Rule 901 states, in part, that “a person shall not cause or permit the emission of an air contaminant or water vapor in quantities that cause, alone or

in reaction with other air cont aminants...injurious effects to human health or safety...or

unreasonable interference with the comfortable enjoyment of life and property.” AQD staff takes into account the ability of a process to comply with Rule 901 as a part of the permit review and will not recommend appro val of any applicat ion that they believe will not be able to comply with the Department’s Rules for Air Pollution Control, including Rule 901. However, if a violation of Rule 901 shoul d occur after the new process has commenced

### Wolverine Power Supply Cooperative, Inc. Response to Comments Document Page 138 of 140 June 29, 2011

operation, the final permit includes sufficient terms and conditions to allow the AQD to enforce this rule and address any su ch problems in the community.

Comment: A decision on the permit should be delayed until the people have a chance to accept or reject the location of the plant.

Response: The location of any facility is an issue addressed by local government thro ugh the planning and zoning processes. The Air Quality Divisi on does not control the selection of sites for industrial facilities nor does it have jurisdiction over local zoning issues. Site selection is done by the permit applicant. The issuance of a Permit to Install by the AQD does not guarantee local site approval. A site assessment is conducted by Air Qua lity Division staff as a part of the permit review process and air pollution impacts are reviewed.

Comment:

Comments were received on the location of t he plant near residential properties and tax breaks that the company may receive.

Response: The location of any facility and taxing iss ues are subjects best addressed by local government through the planning and zoning proc esses. The Air Quality Division does not

control the selection of sites for industrial fac ilities nor does it have jurisdiction over local zoning and taxing issues. Site selection is done by the permi t applicant. The issuance of a Permit to Install by the AQD does not guarantee local site approval. A site assessment is conducted by Air Quality Division st aff as a part of the permit review process and air pollution impacts are reviewed.

Comment: Is the electricity generati ng plant warranted for this area or is it directly attributable to the deregulation of the power generating industry?

Response: The AQD does not have authority to determine wh ether or not a type of industry is warranted for a specific area. The air permitting process involves a th orough review of the proposal and its impacts on the environment including whether or not the emissions will comply with

state and federal health standards. Emissions from the plant will meet the NAAQS and the AQD health-based screening levels.

Comment: The company should be required to provide sa lary for an MDEQ employee to monitor the record keeping and plant operation on a 24-hour basis.

Response:

There is no state or federal law that requires a facility to prov ide staff on a 24-hour basis to monitor plant operation. An AQD inspector is specifically assigned to inspect the equipment, review the records that the permit requires the facility to keep, and review the annual

### Wolverine Power Supply Cooperative, Inc. Response to Comments Document Page 139 of 140 June 29, 2011

emissions reports that the facility is required to submit. The facility is also required to submit test protocols and test results to t he AQD for review and approval.

Comment: Since the facility will be located in close proximity of so many people, they should be held to higher and broader standards than what smaller industry is held to.

Response: All processes that have the potent ial to emit an air contaminant are required to comply with all applicable state and federal rules and regulati ons. Most air pollution control laws are

based on the amount of emissions fr om the process. As a resul t, larger facilities are often subject to more regulations that are often quite stringent. Such is the case with Wolverine. In addition, all facilities that go through the permit review process must comply with national
health standards and the AQD health-based screeni ng levels regardless of the location. Maximum impacts from the facility are below all applicable health standards.

Comment: Can the DEQ and the people of t he State of Michigan trust the company to follow regulations and do the required reporting?

Response: The AQD cannot recommend a permit for approval if it is determined that the proposal cannot comply with all applicable state and fe deral rules and regulations. The company’s proposed installation was reviewed and compared to other similar sources throughout the nation. Any information that seems unreasonable or inadequate is questioned and challenged. The permit is wr itten using the best availabl e and most updated data on the proposed source. Emission levels are compared with levels from similar sources throughout

the United States and with act ual test data to determine if they are reasonable and can be achieved. If the Permit to Install is violated, the regulations allow for AQD staff to take enforcement action against a facility.

Comment:
Would AQD staff allow this facility in t heir neighborhood?

Response: Like most citizens, AQD staff places a high prio rity on residing and raising their families in a healthy environment. We share the concerns voiced by impacted residents, and we apply the air pollution control laws to help ensure pub lic health protection. We are all exposed to air pollutants to some degree. From what we do know about the emissions and health risks associated with such facilities, we ensur e that the allowed emissions do not pose unacceptable health risks, as required under th e law. There are many aspects beyond effects on air quality that would be issues in si ting this type of fac ility in a neighborhood. These include things that are not within AQ D’s jurisdiction such as effects on property values, noise, traffic, etc. All of these are reasonable concerns that most people would want

answered and addressed. The answers to t hese questions would ob viously impact anyone’s response as to whether or not they would accept an industr y in their neighborhood. While these are important issues, the permit under review by the Air Quality Division is meant to address the aspect of effects on ambient air quality. AQD staff is required to make sure that

### Wolverine Power Supply Cooperative, Inc. Response to Comments Document Page 140 of 140 June 29, 2011

all permits issued by the State comply with all applicable state and federal regulations. These regulations are designed to protect human health and the environment. The decision as to whether to approve or disapprove an air permit application in any neighborhood, regardless of location, would depend on whether or not the proposed facility would comply with all such applicable air regulations.

T. Other Comments Received – Not Regulated by the AQD

Comment:

When and where will other environm ental issues such as water, heavy metals, fuel storage,

etc. be addressed?

How can you not mandat e a Water Quality permit first, although the plant will likely use billions of gallons of water, perhaps much of it dewatering water of questionable quality form the quarry or perhaps, mostly from Lake Huron.

Response: The proposed permit is for the prescribed purpose of assuring compliance with Part 55 of 1994 PA 451 only. General Condition 9 of the proposed permit specifically states that “Approval of this permit does not obviate the necessity of obtaining such permits or approvals from other units of government as re quired by law.” Wolveri ne has stated that the plant is being designed for zero discharge a nd that a NPDES (National Pollutant Discharge Elimination System (NPDES) permit, will not be required. Wolverine ha s also stated that a timely permit application for ash disposal will be made to the MDEQ when required for plant operation. The air permit application addresses permitting requirements for fuel storage and handling. With the possible exception of stor m water discharge permitting, Wolverine has again stated that a timely permit application fo r a storm water discharge permit will be made, if necessary, to the MDEQ w hen required for plant operation.

Comment: Petroleum coke results in especially high amo unts of ash compared to coal, in the range of twice as much fly ash and 65 percent more bottom ash.

Response: This activity is not within t he regulatory authority of this per mit. Solid waste disposal is subject to separate permitting. This permit is lim ited to the activities at the source as they pertain to air emissions, which the emissions and impacts from the proposed facility were evaluated and determined to comply with all applicable regulations which are designed to ensure an adequate level of protection for the environment and public health.



### Prepared by: Melissa Byrnes, Robert Sills, Matthew Hall, Julie Brunner, Jim Haywood, and Mary Ann Dolehanty