# United States Department ofthe Interior

ORRCEOFTHESECRETARY Washington, D.C. 20240



### INTERIORDEPARTMENT COMMENT ONNREL PHASE 1REPORT
TheNational Renewable Energy Laboratory's (NREL) Report, ''Navajo Generating Station andAirVisibility Regulations: Alternatives and Impacts" resulted 

### from a request to

### NREL by the Department ofthe Interior (Interior)to develop and objectively synthesize factual infonnation and analyses pertinentto the determination by the U.S. Environmental Protection Agency (EPA) ofBest Available Retrofit Technology (BART) in a Federal Implementation Plan (pIP) 

### for NGS. The study focuses primarily onthe compilation ofadditional detailed information and completion ofa comprehensive and objective analysis consistent withthe five statutorily prescribed BARTfactors. J 

### The studymade no presumption aboutwhatthe appropriate BARTdetermination should be. Rather, its goal was to provideNGS stakeholders, including EPA, with additional data and inputregarding the technical and economic feasibility ofoptions for compliance with the CleanAir Act's BARTrequirement.

Inpreparingthis report, NREL soughtinformation from a wide array ofNGS stakeholders, includingInterior,theNavajoNation, Hopi Tribe and otherArizona tribes, Salt River Project, Central

### ArizonaWater ConservationDistrict (operator ofthe Central ArizonaProject [CAP]), thenon-federal owners ofNGS, conservation organizations and othergroups representing localresidents and stakeholders, and others.
The time constraints ofEPA'sBARTrulemaking process required thatNREL complete this report in a very short timeperiod

- about five months

-- to 

### allowEPA sufficienttime to review and considerthereportprior to issuing a proposed BARTrule. In the face of thistightschedule,NREL carried outan extraordinary amount ofvery high quality work
on an extremely complex set ofissuesto producethis report.
The shorttime frame for this report was 

### further limited byNREL's independentpeer reviewprocessfor the report. Each chapter ofthe report was reviewed by an independent outside expert in the subjectmatter ofthe chapter. This independentpeerreview further
ensures the objectivity and absence ofbias in the NREL report.
Interior has many different interests at stake inboththe future ofNGS and the BART rulemaking. Through theBureauofReclamation (Reclamation), the Departmentis the largest owner ofNGS,witha 24.3% share ofthe plant'spowerproduction. Reclamation also constructed and oversees operation ofthe CAP. TheBureau ofIndianAffairs

1 Cost ofcompliance; energy and non-air-quallty.environmental impacts 

### ofcompliance; existing pollution control technology in use at the source; remaining useful life ofthe source; and the degree ofimprovement in visibilitywhich may reasonably be anticipated to result from the use ofthe technology.supports the interests ofthe many tribes interested in the

### future ofNGS, includingthe NavajoNation, theHopi Tribe, and the many Arizonatribes whichhave contracts for CAP water. TheNational Park Service oversees all the national parks, includingthe Grand Canyonand the many otherparks whose air quality is impacted byNGS emissions. Interior's Office ofSurface Miningregulatesthe Peabody Coal Minethat provides coal to NOS. The U.S. Fish and Wildlife Service, as the agency charged 

### with carrying outthe federal Endangered Species Act and otherfederal wildlife laws, has interests in ensuringthe protection ofthe species under its purview and the clean air and water on whichthose species depend. 

### Inaddition, the Secretary's Indian WaterRights Officeis in charge ofnegotiating and implementingIndian water settlements, includinga number ofsettlements involvingArizona tribes thatrelinquished their seniorwater rights claims inreturn for affordable CAP water.
Interiorbelieves that, overall, theNRELreportprovides an excellentreview and synthesis ofthe many interests and processes that could be affected by EPA'sBART rulemaking forNOS. Interior and its agencies are continuing to reviewboththeNREL report and othernewreports and information relevant to this proceeding; should any DOl agencyfmd it appropriate to comment on specific matters intheNRELreportor elsewhere, it will provide comments directly to EPA.JANICE K. BREWER Governor SANDRA A. FABRITZ·WHrrfJt:V Direator 

### ARIZONA DEPARTMENT OF WATER RESOURCES

3550 North Central Avenue, Second Floor PHOENIX, ARIZONA 85012-2105 (602) 771-8426 February 6,2012
Transmitted viae-mail to: NGS_Report_Comment@ios.doi.gov


### National Renewable EnergyLaboratory 1617 ColeBoulevard Golden, Colorado 80401
The Arizona Department ofWater Resources (ADWR) has reviewed

### Navajo Generating Station andAirVisibilityRegulations:AlternativesandImpacts, preparedby theNational Renewable Energy Laboratory (NREL). We are concerned about the broad-reaching consequences that the costs associated with nitrogen oxides (NOx) removal at the Navajo Generating Station (NGS) will have on water management efforts in the three-cOUnty Central Arizona Project (CAP) service area, and on existing and future Indian water rights settlements in Arizona. Further, the report fails to demonstrate an environrfiemtal benefit to those costs. EPA's effolts appear to be regulation for regulation's sake, rather than regulation designed to protect human health and welfare or provide a specific environmental benefit. In fact, the proposed action will have undesirable environmental and economic consequences throughout Arizona.

ADWR is also concerned that the time allowed for commenting on the report and the two-page, 12-pitch font limitations are insufficient to comprehensively review and analyze the report and fully ex.press questions, concerns, and comments. We publish many reports that are subjectto public review and comment. Theseprocesses are vital to fully vetting issues and providing the best possible public policy and work product. ADWR would never consider limiting comments in the manner prescribed in the instructions, particularly in light ofthe magnitude and breadth ofpotential consequences ofthe actions under consideration.
TheReport states that "EPA's statutory authority in this particular proceeding focuses on visibility at national parks and other priority areas." It further states that EPA is required to "take into consideration the costs of compliance, the energy and nonair qUUlity environmental impacts of compliance," and "the degree of improvement in visibility which may reasonably be anticipated to result from the use of such technology" 

### (Pg ii, Executive Summary).
Thereport fails to provide clearevidence ofvisibility improvements that may beenjoyed through theimposition ofNOxcontrols atNGS. Thereport discusses discrepancies 

### in the JANICE K. BREWER Governor SANDRA A. FABRITZ·WHrrfJt:V Director 

### ARIZONA DEPARTMENT OF WATER RESOURCES

3550 North Central Avenue, Second Floor PHOENIX, ARIZONA 85012-2105 (602) 771-8426 February 6,2012
Transmitted viae-mail to: NGS_Report_Comment@ios.doi.gov

National RenewableEnergy

### Laboratory 1617 ColeBoulevard Golden, Colorado 80401
The Arizona Department ofWater Resources (ADWR) has reviewed

### Navajo Generating Station andAirVisibilityRegulations:AlternativesandImpacts, preparedby theNational Renewable Energy Laboratory (NREL). We are concerned about the broad-reaching consequences that the costs associated with nitrogen oxides (NOx) removal at the Navajo Generating Station (NGS) will have on water management efforts in the three-cOUnty Central Arizona Project (CAP) service area, and on existing and future Indian water rights settlenlents in Arizona. Further, the report fails to demonstrate an environrtlemtal benefit to those costs. EPA's effolts appear to be regulation for regulation's sake, rather than regulation designed to protect human health and welfare or provide a specific environmental benefit. In fact, the proposed action will have undesirable environmental and economic consequences throughout Arizona.

ADWR is also concerned that the time allowed for commenting 011 the report and the two-page, 12-pitch font limitations are insufficient to comprehensively review and analyze the report and fully express questions, concerns, and comments. We publish many reports that are subjectto public review and comment. Theseprocesses are vital to fully vetting issues and providing the best possible public policy and work product. ADWR would never consider limiting comments in the manner prescribed in the instructions, particularly in light ofthe magnitude and breadth ofpotential consequences ofthe actions under consideration.
TheReport states that "EPA's statutory authority in this particular proceeding focuses on visibility at national parks and other priority areas." It further states that EPA is required to "take into consideration the costs of conlpliance, the energy and nonair qUUlity environmental impacts of compliance," and "the degree of improvement in visibility which may reasonably be anticipated to result from the use of such technology" 

### (Pg ii, Executive Summary).
Thereport fails to provide clearevidence ofvisibility improvements that may beenjoyed through theimposition ofNOxcontrols atNGS. Thereport discusses discrepancies 

### in the

### modeling prepared on behalf of Salt River Project (SRP) and modeling conducted by EPA. SRP's modeling results rely on baseline data from rural monitoring sites at Mesa Verde and other locations ofinterest in the Four Corners region, presumably some 

### Of the very visual resources EPA is trying to protect. EPA's modeling results rely on "background

... data collected in more urban or agriculturally developed areas near Farmington that are impacted by local ammonia sources." The report further states that "If the model input ammonia values are too high compared to actual background ammonia concentrations that are mixed into the power plant plumes as they travel downwind of a source, the modeling process can significantly overestimate nitrate particle formation, thus overestimating visibility impact of the plumes." 

### Such an overestimation of the visibility impact would also serve to overestimate the Visibility improvementthat maybe derived from imposition ofNOx controls or closing

### NGS. The report further recommends on-going monitoring to assess the actual visibility improvements from NOx 

### and S02 reduction. ADWR recommends that this monitoring beconducted to assess the impact on visual resources from the S02reduction and regionwide NOx 

### reduction already experienced prior to either imposition of selective catalytic reduction (SCR) orclosure ofNGS.
CAP Water is an integral element of Arizona's water management efforts. Significant volumes ofCAP water were originally allocated to Arizona Indian Communities. Indian contracts totaled 286,100 acre-feet when the Secretary of Interior approved the original allocations in 1983. CAP water has since been an invaluable tool in State and Federal efforts to settle Indian Water Rights claims. Today, 555,806 acre-feet of CAP

### water is under contract to Arizona Indian Communities, having largely contributed to comprehensive settlements in six ofthe seven Indian Water Rights Settlements achieved since 1983. An additional 67,300 acre-feet of CAP Non-Indian Agricultural priority water has been reserved for future Indian settlements, including the pending White Mountain Apache and NavajolHopi Settlements.
The constluction ofNGS was a Federal decision. Increased power costs associated With either SCR implementation or closure of NGS will unduly fall on Arizona's Indian Communities and hampertheeconomic development ofthese impoverished nations made possible by the settlements. 

### In our opinion, imposition of these costs onto the Tribes violates the spirit ofthe settlements to which theUnited States is aparty. Additionally, NGS and the Kayenta Coal Mine are collectively the largest employer on both the Navajo and Hopi Reservations. Closure ofNGS would result in the direct loss of roughly 1,000 jobs and $100 Million in wages for members of these communities, thrusting additional poverty on the Navajo Nation and Hopi Tribe, greater than 35% of whose members already live in poverty. The indirect economic impact of the loss of thesejobs would be substantially larger. Both the Navajo Nation and Hopi Tribe also receive considerablerevenuefrom royalties paidbyPeabody Energy. TheNavajo Nation also receives lease revenues as the NGS is located on Navajo land. These revenue streams wouldbelost with theclosure ofNGS. 

### modeling prepared on behalf of Salt River Project (SRP) and modeling conducted by EPA. SRP's modeling results rely on baseline data from lural monitoring sites at Mesa Verde and other locations ofinterest in the Four Corners region, presumably some 

### Of the very visual resources EPA is trying to protect. EPA's modeling results rely on "background

... data collected in more urban or agriculturally developed areas near Farmington that are impacted by local ammonia sources." The report further states that "If the model input ammonia values are too high compared to actual background ammonia concentrations that are mixed into the power plant plumes as they travel downwind of a source, the modeling process can significantly overestimate I1itrate particle formation, thus overestimating visibility impact of the plumes." 

### Such an overestimation of the visibility impact would also serve to overestimate the visibility improvementthat maybe derived from imposition ofNOx controls or closing

### NGS. The report further recommends on-going monitoring to assess the actual visibility improvements from NOx 

### and S02 reduction. ADWR recommends that this monitoring be conducted to assess the impact on visual resources from the S02reduction and regionwide NOx 

### reduction already experienced prior to either imposition of selective catalytic reduction (SCR) orclosure ofNGS.
CAP Water is an integral element of Arizona's water management efforts. Significant volumes ofCAP water were originally allocated to Arizona Indian Communities. Indian contracts totaled 286,100 acre-feet when the Secretary of Interior approved the original allocations in 1983. CAP water has since been an invaluable tool in State and Federal efforts to settle Indian Water Rights claims. Today, 555,806 acre-feet of CAP 

### water is under contract to Arizona Indian Communities, having largely contributed to comprehensive settlements in six ofthe seven Indian Water Rights Settlements achieved since 1983. An additional 67,300 acre-feet of CAP Non-Indian Agricultural priOrity water has been reserved for future Indian settlements, including the pending White Mountain Apache and NavajolHopi Settlements.
The constluction ofNGS was a Federal decision. Increased power costs associated With either SCR implementation or closure of NGS will unduly fall on Arizona's Indian Communities and hamper the economic development ofthese impoverished nations 111ade possible by the settlements. 

### In our opinion, imposition of these costs onto the Tribes violates the spirit ofthe settlements to which theUnited States is aparty. Additionally, NGS and the Kayenta Coal Mine are collectively the largest employer on both the Navajo and Hopi Reservations. Closure ofNOS would result in the direct loss of roughly 1,000 jobs and $100 Million in wages for members of these communities, thrusting additional poverty on the Navajo Nation and Hopi Tribe, greater than 

### 35% of whose members already live in poverty. The indirect economic impact of the loss of thesejobs would be substantially larger. Both the Navajo Nation and Hopi Tribe also receive considerable revenuefrom royalties paidbyPeabody Energy. TheNavajo Nation also receives lease revenues as the NGS is located on Navajo land. These revenue streams wouldbelost with theclosure ofNGS.

### The 2007 Interim Operating Guidelines quantify reductions to Arizona's fourth priority Colorado River water supply under specified, low-reservoir storage conditions. "Firming" of this supply is an integral part of the State's water management efforts, ensuring critical water needs are met in times of shortage on the Colorado River an increasing probability. These firming activities will benefit Colorado River water Users along the main-stem ofthe River, Indian Tribes with CAP allocations, CAP Municipal and Industrial Users, and others. Additionally, Arizona has stored water to assiSt the State of Nevada in firming their Colorado River entitlement. Through the Indian Settlements, Arizona has contractual obligations to firm supplies for the future benefit of the settling Tribes. The Arizona Water Banking Authority (AWBA) conducts these firming activities. Imposing increased costs on the AWBA could unnecessarily complicate Arizona's ability to meet its overall firming goals, including its 

### Indian Firming obligations.
In recent years, roughly 400,000 acre-feet ofExcess CAP water has also been delivered to non-Indian agricultural users for direct use. ADWR fears that the increased cOSt 

### of CAP water as a result ofimposition ofSCR or closure ofNGS will force many USel'S 

### to return to pumping groundwater, thereby placing the finned water at risk and resulting in water level declines and land subsidence, development and expansion ofearth fiSSures, and waterquality degradation.
While ADWR appreciates the opportunity to provide limited comments to the NREL 

### Report, the arbitrary limitation on the public comments is of significant concern. Additionally, we do notbelieve, based on this study, that imposition ofSCR or closure of the Navajo Generating Station is warranted given the economic and environmental consequences ofthe proposed actions and the lack ofdemonstrable environmentalbenefit that will bederived. Respectfully Submitted,

SandraFabritz-Whitney DirectorCommentsubmitted February 6, 2012 to the Navajo Generating Station NREL Study Team by Alberta Green Energy:

Alberta GreenEnergy Inc. (AGE) offers the following viable solution inresponse to the request for commentsto the National Renewable Energy Laboratory (NREL) Study on the Navajo Generating Station ("Study").

AGE is licensed to utilize and supply provenworld-class gasplasmatechnology and/or plasma
arc technology as developed by Advanced Plasma Power (APP). Data on the gasplasma technology is available at: www.advancedplasmapower.com (click on the Media icon both for videos and a 3D CAD walk-through ofa gas plasma facility). Use ofAGEplasma technologies would resolve the NOx, arsenic, mercury, partjculates, and other air pollution issues at the Navajo Generating Station in a much more effective manner and at a much less expensive cost than the technology options currently presented in Chapter 3, "Control Technologies

- Cost of Retrofits" on page 43 ofthe study.
The gas plasma technology subjects the waste elements in the Navajo Generating Station exhaust flow to extreme high temperatures (6000

- 8000 degrees Celsius) as well as intense ultra violet light in an enclosed vessel and literally deconstructs the constituent elements ofthe waste stream. The gas plasma units have no air emissions themselves, and the units already satisfy European Union2050 air emission standards.
Based on the preliminary information available to us from the study and other sources we estimate capital costs for the installation ofour systems to be in the 35

- 40% range ofthe SCR

### + baghouse control option as reflected in Table 1-9, page 18 ofthe Study. This includes operational redundancies in order to compensate for any scheduled or unanticipated maintenance and downtime ofa gasplasma unit. Similarly gasplasma unit operation and maintenance (O&M) costs can be expected to be only 40-50% ofthe O&M costs estimated in Table 3-11 "Costs for SCRand Polishing Baghouse" for operating SCR's and baghouses at NGS.

With the implementation ofourplasmatechnologies, air emissions includingNOx, arsenic, mercury, and particulates would be reduced to a small fraction ofthose currently being emitted. We estimate an across-the-boards 90%+ emissions reduction, which would be verified through scientific and engineering data and design evaluatjons by AGE appointed technical resources.
Waste products such as particulate, metals, ash and any other solids would be tapped from the plasma torch chamber and stabilized in the formation ofeither molten metal or inertplasmaroc both 0fwhich then become reusable commercial products. At this point C02 could also be sequestered to be utilized for commercial purposes to generate income.
Utilization ofthis gas plasmatechnology could result in making the Navajo Generating Station the first coal-fired facility in North Americato meet or exceed all current and proposed air emission standards. This would establish the Navajo Generating Station as the cleanest power

1generation facility in the Western United States (excluding hydro and nuclear facilities) and thereby could be used as a role model for applicationto additional coal-fired plants.

We respectfully encourage the Navajo Generating Station

### NREL Study Executive Committee to consideruse ofgasplasma technology as a viable air emission control option for the Navajo Generating Station. Sincerely, Douglas V. Fant .For Alberta Green Energy
3655 W. Anthem Way Suite A-109, 

### PMB 411 Anthem, AZ. 85086 (602) 770-5098 Fax (623) 551-7930 dfantlaw@earthlink.net

2

# amwaa ONE FOR**WATER~** Arizone Munldp.lWat.rU",rJA."od
..tlon

February 6, 2012

Department ofthe Interior United States Federal Government Washington, D.C.

RE: Navajo Generating Station Comments

To Whom It May Concern:

The Arizona Municipal Water Users Association (AMWUA) is a non-profit corporation established by cities and towns in Maricopa County, Arizona, for the development of an urban water policy. AMWUA works to advance the rational and effective management of Arizona's water resources. The municipal water systems owned and operated by the AMWUA member cities of Avondale, Chandler, Glendale, Goodyear, Peoria, Phoenix, Mesa, Scottsdale, Tempe and the Town of Gilbert, collectively provide water for over 3 million people, roughly 60 percent ofthe population ofthe State of Arizona. Each ofthe AMWUA members holds a long-term M&I subcontract for Central Arizona Project (CAP) water and, as a result, relies on the Navajo Generating Station (NGS) to provide the electrical energy necessary to deliver this CAP water from the Colorado River into Maricopa County. Because of our members' heavy reliance on CAP water and our long-standing commitment to sound water management in Arizona, AMWUA is commenting on the NGS Report.
The decision whether to require additional emission controls at NGS has significant implications for the AMWUA members who rely on CAP water as a critical component of their sustainable water supplies. The major goal ofthe State's water management efforts in central Arizona is to reduce and eventually eliminate the historical over-reliance on mined groundwater in order to protect the well-being of all residents and the economy of the State. Importation of Colorado River water through the CAP to the AMWUA municipalities and other water users in central Arizona has reduced Arizona's dependence on dwindling groundwater resources by providing a stable, renewable supply of water. AMWUA is concerned about any action that could negatively affect the CAP and the state's abilityto achieve its water management objectives.
Our specific comments follow:
1. It appears from the report that additional emission controls at NGS may not result in any improvement in visibility. Page iv ofthe report states:
"Evidence suggests that NOx emissions from Navajo Generating Station are a likely incremental contributor to haze at the Grand Canyon. Whether the incremental contribution is significant or even perceptible is a matter of debate among experts in the field ofvisibility science." (emphasis added)If this is the case, it seems prudent to weigh whether the unquantifiable benefits of such controls are justifiable in light ofthe likely negative impacts.

2. Large increases in costs to install, operate, and maintain additional controls for the NGS will reduce the affordability of water in central Arizona. Increased water costs could force some users, such as agriculture, to revert to mining groundwater, threatening the State's ability to effectively manage its water supplies. Additionally, increases in the cost of CAP water may negatively impact both existing and future Indian water rights settlements.

3. While the report provides a reasonable basis for the cost impacts ofthe closure alternative, importing water into central Arizona also requires a reliable, steady energy supply. Projecting the unit cost and reliability of replacement power under this scenario is highly speculative. With the debate over the continued use of fossil fuels for generating electricity, alternative energy sources may in fact become more prevalent, bringing with them the attendant increased costs of energy from those alternative sources.

4. The report notes that one possible outcome is accepting the existing plant improvements to improve air quality, LNB/SOFA, with no additional retrofit, but the report does not evaluate this option.

5. The conclusion that installing SCR at NGS would cost less than shutting down the plant does not take into account the relationship between the timing of the determination that the additional controls are required and the resolution of numerous uncertainties surrounding continued operation of NGS beyond 2019.

6. Affordable electricity affects the health and well-being of Arizonans. The NGS provides significant amounts of power to three large electric utility providers in Arizona-Arizona Public Service, Salt River Project, and Tucson Electric Power. Substantial increases in electrical generation costs at the NGS will be passed on to Arizona residents and businesses through increased electricity rates. In many cases, these are the same residents and businesses that will also be impacted by increased water rates.

The final decision on additional controls at the NGS is extremely important and must be thoroughly assessed, understood, and communicated. AMWUA appreciates the opportunity to comment on the report.
Sincerely,

Kathleen Ferris Interim Executive Director

KF:VD:MLA

Navajo Generating Station Comments

### Comments on National Renewable EnergyLaboratoryTechnical Report Navajo Generating Station and Air Visibility Regulations: Alternatives and Impacts Prepared by: Arizona Public Service Company Address: 400 N. 5th Street, Phoenix, Arizona 85004

ArizonaPublic Service Company (APS) appreciates this opportunity to provide comments onthe National Renewable Energy Laboratory's report, "Navajo Generating Station and Air Visibility Regulations: Alternatives and Impacts" (NREL Report). APS is an investor-owned electric utility company serving over 1.1 million customers inArizona. APS is owner/part-owner ofthree coal-fired powerplants, several gas-fired powerplants, and the nation's largest nuclearpowerplant, Palo Verde Generating Station. Specifically, APS is a part owner ofthe Navajo Generating Station (NGS), and therefore, is interested in commenting on the NREL Report.

APS's comments are limited to Section 5 ofthe NREL Report, "Assessment ofVisibility Science." Because our comments are not to exceed 2 pages, we wiJl provide some general comments and would welcome the opportunity to supplement it later with more details, should NREL be interested in those. Our comments below are focused onthree issues: S02 and NOx emissions and their relative contributions to total light extinction (visibility impairment); Use ofCALPUFF 5.8 and IWAQM "default ammonia vales" which cause over-prediction ofnitrate particle formation and their impacts on visibility impairment; and certain errors in Table 5-4 and 5-6 ofthe NRELReport.

In general, Section 5 provides a good summary ofvisibility science, especially as it applies to the arid Southwest. The ColoradoPlateau, home to numerous National Parks and Wilderness Areas, has the best visibility in the nation. A quarter century ofmonitoring under the IMPROVEprogram show improving visibility trend in this region. Analyses ofthose data by the Grand Canyon Visibility Transport Commission and its successor, Western Regional AirPartnership (WRAP) showthat visibility impairment on the Colorado Plateau is caused by sulfates, dust, and elemental/organic carbon particles in roughly equal proportions. Nitrates, on an average contribute less than 5% to the impail1l1ent.

APS agrees with the NREL Report's conclusionthat it is unclear whether reducing NGS NOx emissions by retrofitting Selective Catalytic Reduction (SCR) would result in perceptible visibility improvement in the region. S02 and NOx emissions undergo complex chemical transfonnations in the atmosphere to form sulfate and nitrateparticles. Those conversions are not linear; background ammonia concentrations and meteorological conditionsplay significantroles; and sulfate chemistry takes precedence over nitrate chemistry. The NREL Report concludes, "Even under cold weather conditions in this region, sulfate is usually dominant over nitrate, although the sulfate-to-nitrate ratio is smaller in the cold months." Figures 5-7 to 5-12 in the NREL Report show nitrate concentrations are much smaller than corresponding sulfate concentrations. Figure 1 below shows the relative contributors to total light extinction at the Grand Canyon National Park (data from VIEWS Website) during the best20%, middle 20%, and worst 20% visibility days during 2006-2008. In each ofthe three cases, nitrates contribute less than 5% ofthe total extinction compared to 12% to 19% by sulfates. Recalling that NOx emissions fTom allcoal-fired powerplants contribute less than 30% ofoverall NOx emissions, it is reasonable to conclude that power-plants' contributions to the total extinction will be even less than 5%. Therefore, significant reductions inNOxemissions from NGS are not likely to produce significantreductions in their contributions to total extinction. 

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APS agrees with the NREL Report's conclusion, "Measurements specific to this region indicate that actual visibility impacts [from NOx emissions] may not be as great as those estimated by CALPUFF 5.8 as applied by EPA" (Page 92). This over-prediction resuJts fTom 2 aspects: use ofincorrect background ammonia concentrations and flaws in the chemistry module in CALPUFF 5.8. Ithas been well-established that CALPUFF 5.8 over-predictsnitrate concentrations (e.g., see studies by Morris, 2001; Scire, 2003; Karamchandani, et aI, 2008; Hoffnagle, 2012, and others). Atthe suggestion ofthe Modeling Group at EPA-OAQPS, in 2011 Scire (who developed the CALPUFF Model) evaluated revisions to the model's chemistry module recommended by a study sponsored by the American Petroleum Institute. Those evaluations resulted in the revised CALPUFF 6.4, currently available for public use. Again, atthe suggestion ofEPA-OAQPS, Scire tested the chemistry module against three other existing data sets; and the results ofthose tests are expected to be presented at the EPA's 10th Modeling Conference during March 13-15,2012. Background ammonia values were collected at numerous rural areas inthe West and were summarized by Tombach (2011). Tombach showed thatthe IWAQM default ammonia value ofl ppb throughout the year is not appropriate for the Four Corners region and much lower values should be used for CALPUFF modeling, consistent withrecent field measurements. For example, background ammonia concentration measurements at the MesaVerde National Parkranged from 0.2 ppm during winter months to 1.0 ppm during summermonths, with intermediate values during spring and fall at 0.5 ppm (Sather, et. aI., 2008)

..Accordingly, the NREL Report should recommend using revised CALPUFF 6.4 model and actual ammonia concentrations in assessingpotential visibility improvements from NOx emissions reductions at NGS. Finally, two tables (5.4 and 5.6) in the NREL report appearto be erroneous. Table 5.4 (page 75) lists two sets ofS02 and NOx emissionnumbers; unfortunately the two sets ofnumbers are identical. Clearly, one set ofnumbers is not valid. Table 5-6 (on page 84) lists two columns ofammonium nitrates concentrations during 2001-2005 and 2006-2010 for 9 Class I areas, and the last column shows "Percent Reduction." The numbers in the last column, presumably the difference between the other two, are not correct. NREL needs to review and correct the numbers in Table 5-6.l602)**2~2-9227 (p~)** **~602)** 252120 (1):)

February6, 2012

U.S. Department of Interior NGS Report Comments@ios.doi.gov

RE: Comments on NREL Report, Navajo Generating Station andAir Visibility Regulations:Alternatives andImpacts

On behalf ofthe Arizona PIRG Education Fund, I am writing to commenton the National Renewable Energy Laboratory's recent analysis regarding Navajo Generating Station.
Although, the NREL analysis addresses a broad spectrum of issues, ourcomments focus onjust one of those issues

- the impact of pollution controls on water costs in Central Arizona. In short, NREL's analysis misrepresents the impact of pollution controls on water customers in Central Arizona.

NREL concludes that ItReplacing Navajo GS power required for CAP pumps with market power under high price conditions would dramatically increase water rates. ltl While the cost of raw water will increase by a substantial percentage, the impact on water rates for municipal households is minimal. Calculating the impact on municipal customers

- not raw water costs

- is a critical, but omitted, component ofthis analysis. For example, underthe high power price scenario illustrated in Table 4-23, long term subcontract water rates are projected to increase by $64/AF. The City of Phoenix is one of the largest subcontractors for Central Arizona Projectwater; in Phoenix, the typical household uses 0.37 AF/year (121,000 gallons/year).2 Phoenix's watersupplies are comprised of a mix of CAP water (45%)3 and water from other supplies (local surface water supplies, groundwater, and recycled water). Given these two factors, the typical Phoenix household uses 0.17 AF of water from CAP each year. Even under the high rate increases described above, the average Phoenix household would see water bills rise by $1O.66/yr, or $0.89/month.

This rate impact is comparable to or less than rate increases the Phoenix water utility has imposed in recent years. For example, from 2009 to 2010, a typical household saw its annual water bill rise by over $17. Even with these rate increases, Phoenix households pay less for water than residents in many other cities in the region (Figure 1).

In sum, the pollution controls may impose a cost on the price of raw watersupplies that may indeed have a significant impact on agricultural users and Tribal users. However, the impact on municipal customers, who bear the bruntof the cost increases, is marginal.

1 NREL, Navajo generating Station and Air Visibility Regulations: Alternatives and Impacts, p. 67.
2 Western Resource Advocates, 2010. Arizona Water Meter.
3 City ofPhoenix Water Services Department, 2011, 2011 Water Resource Plan

### Annual Residential Water Costs $500 $400 $300 $200 $100

$­ Phoenix Phoenix Albuquerque Denver Las Vegas (2009) (2010/2011) (2011) (2011) (2011)

Figure 1. Residential water costs in Phoenix in 2009 and 2010/2011 were lower costs in several other southwestern cities. (All costs reflect household use of 0.37AF ofwater.) Second, the cost analysis is inconsistent with regard to the price of wholesale power. Wholesale power
revenues are used to meet CAP's repayment obligations and are dedicated to the Development Fund. Accordingly, surplus power revenues (orthe lack of) directly impact the prices paid by CAP water customers. In calculating the value of Navajo GS surplus power, NREL assumed power could be sold at $27/MWh. 4 However, NREL assumes the cost of replacement power from an NGS shutdown would be $32.44

- $49.48/MWh (Table 4-19). The price of replacement power should be comparable to the prices paid (and revenues generated) by Navajo GS surplus power.

In conclusion, the relationship between reliable, affordable drinking supplies in Central Arizona and the Navajo Generating Station is complex and critical to understand. In determiningthe appropriate pollution controls, we encourage EPA to consider the cost impact on ratepayers, not on raw water costs. The strictest pollution controls would lead to a small rise in municipal water rates. Sincerely,

Diane E. Brown Executive Director

4 NREL, Navajo Generating Station and Air Visibility Regulations: Alternatives and 1m pacts, p. 56.Comments to the NREL report,

### Navajo GeneratingStation amiAir Visibility Regulations: AlternativesandImpacts (the "Report") Central Arizona Water Conservation District ("CAP") 23636N. 

### i h Street, Phoenix, Arizona 85024
In the Report, NREL accurately declares that "the question fundamental to this proceeding" is "how reducing NOx from NGS would contribute to improved visibility at the Grand Canyon and other areas of concern." (Report, p. IV). The answer to this fundamental question is, at best, inconclusive. Consequently, there is no justification for installing SCR or other control technologies at a price tag of$500 million to $1.1 billion, as there is no known or expected effect
on visibility that can reasonabl.y be anticipated to resul.t. The poll.ution control. system currentl.y inplace atNGS, including 

### LNB/SOFA, is BART.
In determining what technologies constitute BART, the Clean Air Act ("CAA") requires EPA to consider five factors. While the fundamental factor ofvisibility trumps all others, the Report also addresses the costs of compliance, existing pollution control technology in use at the source, energy and non-air quality environmental impacts of compliance, and remaining useful life. NREL's analysis ofthese issues warrants comment as follows, including a more in-depth review ofthe visibility aspect. Note that CAP wiH also submit separate, more detailed comments to EPA and DOL


### 1. Additional Control Technologies Yield Imperceptible Changes in Visibility. The CAA states that EPA "shall take into consideration

...the degree of improvement in visibility which may reasonably be anticipated to result" from use of proposed BART technology. Id. NREL examined the modeling used by all parties to this proceeding, and concluded that whether any incremental contribution to haze by NGS "is significant or even perceptible is a matter of debate among experts in the field ofvisibility science." (Report, pp. 113, IV). According to the Report, NGS "is already using the best avail.able control for reduction of S02, the pollutant with the largest potential to impact visibility." (Report, p. 85). These sulfate particles are 3-5 times or more significant than nitrates in calculated visibility impacts in the Southwest. (Report, p. 90). With regard to NO;.;, upon completion of the installation of 

### LNB/SOFA in 2011 at a cost of$45 million, NGS achieved a NO;.; emission rate ofslightly more than 0.21 Ib/mmBtu, or nearly 25% less than the presumptive BART emission limit of 0.28 lb/mmBtu established by EPA for facilities similar to NGS in design and type of coal used. Against this background, NREL could not conclude that additional retrofit would have any effect
on visibility. Indeed, the Report states that "[t]he body ofresearch to date is inconclusive as to whether removing approximately two-thirds ofthe current NO" emissions from NGS would lead to any perceptible improvement in visibility at the Grand Canyon and other areas ofconcern." (Report, pp. 113, IV).

2. EPA's Visibility Modeling Methodology is Flawed. NREL also calls into question EPA's modeling, which suggests at least the possibility of perceptible haze, stating that "[m]easurements specific to this region indicate that actual visibility impacts may not be as great as those estimated by CALPUFF 5.8 as applied by EPA." (Report, p. 92). With respect to measures of background ammonia, which affect visibility outcomes, "EPA's ammonia background values correspond more closely with data collected in more urban or agriculturallydeveloped areas near Farmington that are impacted by local ammonia sources." Id. On the other hand, SRP's ammonia background levels match more closely with similar rural and isolated sites, causing NREL to conclude that "use ofthe SRP ammonia background values in CALPUFF produces a much better comparison between modeled and measured values." (Report, p. 80). This is critical, because ifammonia values are too high, "the modeling process can significantly overestimate nitrate particle formation, thus overestimating visibility impact" of power plant plumes as they travel downwind ofa source. (Report, p. 92).

3. 

### Excessive Costs Do Not SupportAdditional Pollution Controls. The Report's "cost of compliance" analysis is incomplete and misleading. In light ofthe extremely high cost ofretrofit and lack of resulting visibility benefits, the Report nonetheless fails to evaluate the recently added LNB/SOFA as BART. Failure to examine this alternative as BART results in a false choice between two stark alternatives-SCRretrofit orplant shutdown. Moreover, the Report's conclusions regarding the costs and likelihood of plant shutdown are based on a "best case" scenario that makes unrealistic assumptions and ignores critical considerations. While conceding that "key uncertainties could affect the basic economics," NREL disregards the likelihood ofthese uncertainties. (Report, p. iii). For example, the Report does not examine the critical relationship between the timing ofthe BART determination and the resolution ofdoubts pertaining to renewal ofthe plant site lease, rights-of-way, the cost ofcoal, and other factors-doubts that may not be resolved until 2019. Instead, the Report simply
assumes the cost of SCR's would be amortized over 20 years, and a low cost of capital that is speculative at best. (Report, p. 59). With that, NREL concludes that installing SCR or SCRwith baghouses and sorbent injection would "likely" be less expensive than shutdown of NGS. (Report, p. iii). In fact, it is entirely likely that mandated retrofit before the critical plant extension issues can be resolved would render shutdown as the least-cost option.
4. 

### Demand for CAP Water is not Inelastic

- High 

### Energy Costs Affect Demand. The Report does shed light on the substantial increases in the cost of CAP water should additional retrofit be required. However, NREL's assumption that demand for CAP water is inelastic is simply not realistic. CAP's tribal and agricultural customers will face price increases of 16-32% ifEPA requires SCRor SCR with baghouses. This will prompt someusers to return to the use of finite groundwater supplies, defeating one ofthe principal rationales for the existence ofCAP and resulting in even higher costs for remaining CAP customers.
5. 

### Disproportionate Effect on Tribes and Agricultural Users. The Report accurately concludes that, should EPA select SCR or SCR/baghouses as BART, the economic impacts would fall disproportionately on tribes and agricultural users. Beyond the cost increases, non-air quality impacts tojobs and the economy ofNavajo and Hopi reservations would be significant. Ultimately, NREL's answer to the "fundamental question" is that the evidence fails to support that additional retrofitting of NGS will result in improved visibility. Without convincing evidence that any retrofit beyond LNB/SOFA will have a positive effect on visibility in the Grand Canyon and other Class 1 areas, the massive expenditures contemplated are notjustified when taking into account the requirements of the CAA to consider costs and degree of reasonably anticipated visibility improvement. Finally, in addition to the comments specifically setforth above, CAP fully supports the comments submitted by the SaltRiver Project.

### February 6, 2012 U.S. Departmentofthe Interior NGS Report Comment@ios.doi.gov


### RE: Comments onthe NREL Report, 

### Navajo GeneratingStation andAir VisibilityRegulations:AlternativesandImpacts
The Environmental Defense Fund (EDF) submitsits comments on the NREL report cited above. We arejoined in these comments bythe Forgotten People, the National Parksand Conservation Association, and Western Resource Advocates.

EDF appreciates the extraordinary efforts taken by NREL to compile and presentthe multitude ofissues surroundingthe operation and financingofNavajo Generating Station and the associated Kayenta mine. Our comments focus on the assessmentof visibility science and a concern aboutthe lack ofclarity regardingthe financing of sulfurdioxide (S02) emissions controls in theearly 1990's. 

### VisibilityAnalysis
On page 77, Table 5-2 comparesthe modelingprocedures used by SaltRiver Project (SRP) and the Environmental Protection Agency (EPA). The background ammonia used in the mostrecentSRP assessmentis taken from a regional model (CMAQ) ratherthan monitored data. ThatCMAQ model run was quality-assured for best results in the southeastern U.S., not for predictionsin the southwest. As noted later
on page 92, the largestdifference in visibility impactmodelingis duetothe input value ofbackground ammonia. Choosingmodeled ammonia concentrationsfrom efforts focused on predictingairqualityin the southeastern U.S. ratherthan monitored ammonia data from across the desertsouthwestregion is highly questionable.

On page 73 and again on page 80the reportmentions a studyby 

### R. Henrythatfinds the consistentdeciview (dv) threshold ofperceptible change is higherthan the 1.0 threshold thatEPA defines as generally perceptible. Thatstudyexaminedthe threshold for colorperception changes. Otherstudies suggestthatobservers may be more sensitive to achromatic changes.l The reportalso states thatthe SRP studies find no perceptible improvementfrom installation ofSCR while the EPA studyfinds perceptible impairment.

Itis importantto note thatboththe SRP and EPA modelingfind significant contributionto visibility impairmentfrom NGS as defined bythe regional haze regulations. This is especiallytruewhen consideringthe cumulativeimpacts ofNGS
across eleven Class J

### areas. AJI visibility assessmentsdoneto date demonstratethat NGS' NOx emissionsare a significantcontributorto human-caused visibility

1

### Tombach I., 

### R. Henry, L.W. Richards. 1998 ACritical Review ofKnowledge About Human Perception and Visibility Change, 98-MALOl

### impairmentatmany Class Iareas. EPA noted in the preamble to the final BART rule requiringSCR levels ofcontrol atthe San Juan GeneratingStationthat u .
..

### a perceptible visibility improvementis nota requirementofthe BART determination
as a visibility improvementthatis notperceptible maystill bedetermined significant" 2

Table 5-8 comparesthe cost/benefitcalculations for various facilities based on maximum dv impactin a Class Iarea for various sources in the region. Itdoes not include a numberofBART determinations by States and EPA where SCR was determined to be BART for NOx

### emissions. Examining final BART decisions requiringSCR at 11 powerplants in the West, usingthe metricofannualized cost per 1 dv improvement ofthe 98th 

### percentile atthe mostaffected Class I area, finds a range from approximately $6.4 million peryearperdv to $51.4 million peryearper dv. Thecostbenefitmetric for SCR atNGS atapproximately $33 million peryear perdvis within thatrange. In addition, mostofthe powerplants do not significantly affect as many Class I areas as NGS. The large numberofClass I areas thatwould see a significantcontributiontoward visibility improvementstrengthens the costbenefit consideration for SCR atNGS. 

### Financing 

### ofBureauofRecJamation's Share 

### ofEnvironmentalControls

On page 22 the reportindicates thatthe U.S. Bureau ofReclamation costs ofS02 scrubbers in 1992 was $102 million, close to the projected costs ofinstalling SCR at $113 to $132 million. The estimates ofwaterratechanges developed by NREL for SCR plus othercontrolsassumed the Central ArizonaWaterConservation District (CAWCD) would finance capital costs at5% and recover capital and operatingcosts from CAP rates. It is unclear from the reportwhetherthatwasthe mechanism used to finance the S02 scrubbers. The reportimpliesthatthe Bureau's costs for S02 scrubbers atNGS are paid bythe CAWCD tothe Lower Colorado Basin Development Fund overa 50-yearperiod. The reportshould have clearlypresented the funding mechanism the Bureau ofReclamation used forthe S02 scrubbers as well as historical CAP waterrates duringthe period ofpaymentfor the S02 scrubbers. Such informationwould illuminate howwaterrates mightbe affected bythe costs of additional environmental controls.

We appreciatethe opportunityto providecomments onthe NREL study. We encourage the Departmentandthe EPA to cooperatein addressingthe environmental impacts ofNGS as well as protectingeconomicand social values of the region.

Bruce Polkowsky, contractoron behalfof Environmental Defense Fund Boulder CO

276 FR 52427

## USDA United States Forest Washington 1400 Independence Avenue, SW ??:Z5i Department of Service Office Washington, DC 20250 A riculture

File Code: 2580 Date: 

## FEB 0 3 2012 Letty Belin Counselor to the Deputy Secretary Department of Interior NGS_Report_Comment@ios.doi.gov

Dear Ms. Belin:
The United States Forest Service is grateful for the opportunity to provide the following
comments on the document entitled Navajo Generating Station andAir Visibility Regulations: Alternatives and Impacts generated by the Department of Energy's National Renewable Energy Laboratory (NREL). The report provides significant information regarding air pollution control options at the Navajo Generating Station (NOS), the economics of water and power delivery, and potential social/economic impacts of Native American interests. We are encouraged by the report findings that installing selective catalytic reduction controls would not significantly change the amount of energy provided by NGS, and that on-site power plant and mine employment would be unchanged.

The USDA Forest Service plays a significant national role in the development and assessment of visibility science. As such, our review is focused primarily on this aspect ofthe study, Importantly, we areconcerned that the third party visibility modeling results presented in this report have not met the burden of scientific testing and documentation needed to support the modeling conclusions. These undocumented methods mayjeopardize the integrity ofthe Best Available Retrofit Technology (BART) modeling process and potentially undermine prior BART determinations (and thus emissions reductions) made in other states and EPA Regions. Our technical comments are attached

.**.....-t:::H~D5.-JIE** A. C. WELDON ty Chief, National Forest System

Enclosure

""­ Caring for the Land and Serving People Prinled on Recycled Paper

### ~I

### 1

01/3112012


### Attachment
USDA Forest Service Technical Comments on Study: "Navajo Generating Station and Air Visibility Regulations: Altematives and Impacts" Visibility Science 

### While the report provided a cursory summary ofthe myriad ofissues affecting visibility science, much ofthe focus ofthe visibility science section is on CALPUFF modeling studies that were conducted by Salt River Project (SRP) and the Environmental Protection Agency (EPA) and two key underlying elements in that modeling (regardless ofmodel version): assumptions of background ammoniavalues and horizontal grid resolution.
The report concludes that the largest source ofdifference in the modeling conducted by EPA and SRP lies 

### inthe background ammonia values assumed without addressing additional differences in modeling techniques. Summaries ofmodeling conducted for SRP using a version ofthe CALPUFF system (v6.302) with updated chemistry for the Hayden Power PlantBART detennination 

### in Colorado showed thatthe use ofthe ammonia limiting method (ALM) yielded approximately a 70% reduction 

### in the maximum impactwith 104 and 115 fewer days above the 0.5 and 1.0 dv thresholds respectively. 1 

### Change in grid resolution alone accounted for approximately a 17% reduction in maximum impacts and 50 fewer days above either the 0.5 or 1.0 dv thresholds atthe Mt. Zirkel Wilderness Area. I 

### Cbangingto the newerchemical mechanism withinthe CALPUFF model only accounted for approximately a 25% reduction in maximum impact and only 28 and 8 fewer days above the 0.5 and 1.0 dv thresholds respectively.' These summaries clearly indicate that the ALM technique and enhancedhorizontal grid resolution as the primary drivers in

### reducing modeled impacts in the CALPUFF system (v6.4) and that the effect ofthe enhanced chemistry is secondary to these techniques.
The report cited that in August 2011 EPA rejectedthe newer CALPUFF version for use in BART because it "

...

### has not been adequately testedandsubjectedtopublic review and comment.,,2 

### We believe it is important to for the reader to note that, while the v 6.4 may indeed refine CALPUFF's secondary aerosol estimates, the SRP analysis (noted above) for Hayden demonstrated that it was the ALM technique and the increased horizontal grid resolution that likely accounted for the greatest changes in modeled impacts noted between the 2011 SRP and 2009 EPA modeling analyses. It 

### is crucial to understand that itwas insufficient technical justification provided by the CALPUFF model developerfor eithertechnique which ultimately led to the EPA rejection ofthe v6.4 analysis provided by Public Service Company ofNew Mexico (PNM) to EPA for its federal implementationplan (FIP) for the San Juan Generating Station (SJGS). EPA identified a number ofissues withthe appropriateness ofthe techniques and estimates using v6.4. Most ofthe modeling procedures employed by the 2011 SRP analysis
are identical to the procedures ofthe PNM analysis for the SJGS FlP and 2010 SRP Hayden analysis. EPA noted the following in the SJGS FIP:


### • CommentersJailed to establish the scientific basisJor use oja higher resolution meteorologicalgrid (I-Ian)

### Jor modelingojvisibility impacts using the CALPUFFmodeling

### 2

system. Commenlers did notprovide statistical analysis showing betterperformance of the higher resolution meteorological fields wereprovided, didnot establishedthe relationship between gridresolution andchemistry conversion equations, anddidnot adequately explain the relationship of gridresolution to 

### better air quality modelperformance.3 

### • Lack of documentation, adequate technical justification. andvalidationfor the development and use of the ammonia limiting method (ALM). EPA andthe FLMs havepreviously reviewedprotocolsproposing usingALMandthe EPA andFLMs have notapprovedthe use of theproposedAIM procedure.3,5 o 

### Each of thepapers citedwerepresentedaspartof generalproceedings at conferences, andtherefore do not reflect the thoroughness of aformalpeer review process thatwouldbe associatedwith submission to 

### mainline scientificjournals and didnot consider these references suitablefor establishingthe validity of the model or post-processingtechniques or demonstrating that these models have undergone independentscientificpeer review as necessary for reviewing models in accordance with federal regulations. 4
o 

### The evaluation techniques utilizedby the developer are notappropriatefor evaluation of the chemical mechanisms of the CALPUFFsystem. These techniques
were deemednotsatisfactory forpurposes of modelperformance evaluationsforfull science chemistry models anddidnotconsider the analysis techniquespresentedby the modeldeveloper sufficient to demonstrate that the model is not biased in accordance with federal modelingregulations. 4
While more accurate quality modeling methodologies should always be sought, federal air quality modelingregulations have been developed to ensure thatthe selection and application of air quality models are done so in a consistentmanner. Consistency ensures that the public has a commonbasis for estimating pollutant concentrations and specifying emissions limitations. The federal modeling regulations provide a consistent basis for selecting the most accurate models and databases for air quality assessments such as BART.6 EPA published guidance on May 15, 2009 which included a significant discussion on the use of i-km grid resolutions with the CALPUFF system. 7 In this guidance, EPA cited the lack oftechnical foundation for use of higher resolutions as the primary basis ofits recommendationto maintain gridresolutions atno higher than 4-km. Likewise, EPA's dismissal ofv6.4 for the SJGS FIP was done so on this basis. Despite the publication ofEPA guidance in 2009 describing the necessity ofgreater documentation priorto acceptance, the SRP and PNM analyses continued to proffer the same techniques withoutoffering any concrete technical analysis to demonstrate that the techniques enhance meteorological and air quality model accuracy. Without this, the public cannotbe assured that the proposed techniques do not bias modelpredictions towards underestimation as is required under federal modeling regulation. 8 Unfortunately, the report yields significant deference to the 2011 SRP analysis to draw conclusions that modeling conductedby EPA as part ofits 2009 ANPR likely overestimates the benefitofNOx controls onnitrate formation without a proper analysis ofthe 2011 EPAdecision to disallowuse ofv6.4. Therefore, we believe it to be imprudent ofa government report to lend such strong credence to modeling results when such modeling has notmet the burden ofscientific testing and documentationnecessary as mandated by federal regulation.

### 3



### Further, while the report correctly explains that CALPUFF is used as a screeningtool to provide
arelative comparison on the visibility change that might result from various control options, it does not adequately explain that screening methods are, by their very nature, intended to provide preliminary, conservative estimates ofair concentrations and that the modeling methodologies described in the BART guidelines were developed bearing 

### in mind that CALPUFF concentration estimates would be conservative.9,lo


### References 1. 

### SRP,2010: Preliminary Prehearing Statement ofSaltRiver Project Agricultural Improvement and Power District Regarding Proposed Revisions to the Regional Haze State Implementation Plan and Regulation No.3, Part F BestAvailable Retrofit Teclmology Requirements 2. NREL, 2011: Navajo Generating Station and Air Visibility Regulations: Altematives and Impacts, p. 77. 3. EPA, 2011: Approval and Promulgation oflmplementation Plans; New Mexico; Federal Implementation Plan for Interstate Transport ofPollution Affecting Visibility and Best Available**Retro~t** 

### Technology Detennination. See 76 FR 52436 4. EPA, 2011: Approval and Promulgation ofImplementationPlans; New Mexico; Federal ImplementationPlan for Interstate Transport ofPollution Affecting Visibility and Best Available Retrofit Teclmology Detennination. See 76 FR 52432 5. USFS,2011: CALPUFF Reviewer's Guide, p. 5-1,2 6. Section 1.0(d) to 40 CFR Part 51, Appendix W 

### 7. EPA, 2009: Model Clearinghouse Review ofCALPUFF Modeling Protocol for BART. 14 pp. 8. Section 3.2.2 to 40 CFR Part 51, Appendix W 9. Section 4.2.1.1(a) to 40 CFR Part 51, Appendix W 10. EPA 2005, Final Rule, Regional Haze Regulations and Guidelines for Best Available Retrofit Technology (BART) Detenninations. See 70 FR 39123COMMENTS OFTHE GILA RIVER INDIAN COMMUNITYAND THE AK CHIN INDIAN COMMUNITYON THENRELNGS REPORT February 6,2012
TheNational Renewable Energy Laboratory (NREL) conducted a study entitled "Navajo Generating Station andAir Visibility Regulations: Alternatives and Impacts" under an InteragencyAgreement between the Department ofthe Interior (Interior) and Department of Energy (DOE). The Gila River Indian Community ("Community") and theAk Chin Indian Community ("Ak Chin")jointly submit these initial limited comments to the NRELReport. The Community and Ak Chin reserve the right to submit additional, more extensive comments in writing to the Department ofthe Interior and the Environmental Protection Agency as part ofthe on-going consultations with those agencies.

I The impact ofthe proposed BART implementation scenarios onthe Lower Colorado River Basin Development Fund (LCRBDF) as described in the NREL report are seriously understated. Because the impacts on the LCRBDFwere estimated improperly, the important, negative effects on the GRIC and the other CAP contract entitlement tribes from reduced monies into the LCRBDF were missed. The problem lies in the understated NGS surpluspower revenue projections which feed the LCRBDF.
This shortcoming is explained by the incorrect assumption in the NREL report related to the relationship between the cost ofNGS power generation and the price ofNGS surplus power. NREL
assumes the cost and price which existed at the time oftheir study would continue overthe long term. In fact, costs ofNGS power have recently been high due in part to spiking coal prices (nearly double nationwide since 2000) , and a depressed market price for power due to economic conditions, among other factors. For example, the NREL impact estimates on the LCRBDF assume that the currentNGS surpluspower sales price will stay at current levels.
The current marketranges between $19 per megawatt-hour (MWI-I) off-peak to $35MWH on-peak. This is compared with the market price five or so years ago when power was sellingfor $40

- $45 for MWH power off-peak, $80 perMWH on-peak. The point is, by fixing in place the cost and price ofNGS surplus power, the negative effects ofthe BART scenarios on the LCRBDF are not apparent. However, projecting even a return to more normal market conditions, much less power price escalation over the longterm, would reveal the diminished revenues to the LCRBDF from the proposed BART scenarios. Why is this important to the Community, Ak Chin and the other CAP Settling Tribes? A primary purpose ofthe LCRBDF is to pay the Tribes' portion ofCAP fixed operations, maintenance and replacement costs for CAP water. lfthe LCRBDF cannot pay those obligations, then the CAP Settling Tribes would be obligated to do so, which would result in a tripling ofCAP water costs at current rates. Such an increase would render CAP water use by the C to be infeasible, resulting in:

• A breach ofunderstanding that the GRIC would only be obligated to pay CAP energy costs.

• A reduction or cessation ofGRIC and perhaps other Indian agriculture.•A loss ofinvestment in GRlC and other Indian irrigation facilities.

•A lost opportunity for the GRIC using the CAP water for non-agricultural purposes.

•A possible return ofthe CAP water to the CAWCD with unpaid costs, prompting a fiscal crisis for that organization and the rest ofthe CAP water users throughout Arizona.
We believe these risks are real and that they are heightened by the proposed BART implementation impacts on the LCRBDF.
2. In the NRELReport, onpages 2 to 3, NRELnotes that the its study will include a supplemental volume examining alternative generating options to prepare for a smooth transition [Tom coal to cJean energy.
As an initial comment, the Community andAk Chin disagree with the notion that coal cannot be "clean energy". The very measures under consideration now in the current BART proceeding, and in simultaneous rulemakingproceedings, are supposedly intended to make coal
a cleaner source ofpower. The underlying assumptjonthat coal can never be clean enough is problematic and indicates a troubling pre-disposition onthe part ofNREL as it approached this subject.


### Ifthe Administrationposition, however, is to transition away from coal-generated electricalpower at NGS, we agree withNRELthat it is important now to prepare for a smooth transition for the affected Tribes from coal to a different source ofenergy for boththe CAP and for the subsidies on which those tribes with water settlements inArizona rely.
To that end, we strongly urge NRELto include in its supplemental study an examination ofthe need to develop solar or other renewable energy facilities, on Indian Reservation lands, with the netrevenues ofwhich solely dedicated to replacing the loss in subsidy supports to those tribes with water settlements inArizona ("CAP SettlingTribes").
While solar facilities developed on any IndianReservation arguably could have the
revenues ofthe facility dedicated to such a purpose, it would make most sense to site such a faci Iity on the lands ofan affected CAP SettlingTribe. Such a solar facility would need to be subsidized to a certain degree, in order to produce a revenue stream that would suffice to offset the lost subsidies on which CAP SettlingTribes rely. The extent ofsuch a subsidy would be directly related to the amount oflost subsidies. Finally, we note that given the substantial underestimation ofthe effect ofthe BART on the sale ofsurplus NGSpower, and the failure to take account ofother concurrent regulatory rulemakings, it is possible that the issue oftransitionto solar based subsidies may already be one that needs to be addressed, and not something that can wait for the future supplemental report.Le Roy N. Shingoitewa 

# THE Chairman

# ~OP' 

# TRIBE
Herman Honanie Vice-Chairman



### February 6, 2012 Navajo Generating Station Study Commission U.S. Departmentofthe Interior, 1849 C StreetNW Washington, DC 20240
Dear Commissioners:

In response to the Phase One Navajo Generating Station Study ("NREL NGS Report") comment period, the Hopi Tribe submits the following:

o In December 2011 comment period; the Hopi Tribe requested that the NREL NGS Report distinguishthe tribal membership ofthe employees at the Kayenta Mine. We note that Peabody Energy and the Salt River Project state they do not collect specific membership however the NREL NGS Study statement generalizes that both the Navajo and Hopi Tribes constitute a significant portion ofthe on-site labor force at the plant and at the mine. We point to the NREL NGS Report Page 95 that eighty-three (83) ofthe management or a professional role at the Power Plant are Navajo-preference positions and does not make the distinction out ofhow many management positions.

oNREL NGS Map 6-1 does not reflect the Hopi Tribe's Moenkopi District Reservation which consists of over 60,000 acres ofHopi Land, nor does the Map accurately reflect the partitioned lands as well as the Hopi Tribe's ranch lands.

oThe Hopi Tribe submits for the record Vice Chairman Herman G. Honanie's testimony given at the Arizona Inter-Tribal Council Department ofthe Interior Navajo Generating Station Meeting on August 31, 2011.

o Correction: The Navajo Generating Station accounts for 65% of the Hopi Tribe's
revenues.
On July 21, 2011, the Hopi Tribal Council enacted Resolution H-066-20ll requires the Tribe's stance as neutral in response to developments regarding the Environmental Protection Agency's (EPA) proposed actions against the Navajo Generating Station. This Council action is a result of

P.O. BOX 123

----- KYKOTSMOVI, AZ

---- 86039

----- (928) 734-3000

### the Little Colorado River Adjudication settlement and howit wouldbetiedinto the operability ofNGS resulting in significantcosts and increasedrates to NGS powerusers.
The NGS issueis a difficult one for the Hopi Tribe. We are acutely aware ofthe decisions made by ourTrustee, the Department ofInterior, and how those federal policy decisions impact the Hopi Tribe. The Hopi Tribehas always been concerned about the effects ofNGS onthe pristine quality ofour air andwaterusedbyPeabody in supplyingcoal to NGS. We also understand that coal revenues are important to the Tribe and benefitthe Hopipeople.
Thank: you for providing the Hopi Tribe an opportunityto submit further comments and ifyou have any questions, please feel free to direct them to me.

## Re~p~ /)<' 

### "'7 

# 7
LeRoyN. Shingoitewa Chairman TheHopi Tribe

Attachments

P.O. BOX 123····· KYKOTSMOVI, AZ

.... 86039 .••.. (928) 734·3000Navajo Nation Comments on National Renewable Energy Laboratory Energy Analysis for Navajo Generating Station and Air Visibility Regulations: Alternatives and Impacts
Given the limited amount oftime the NREL had to develop this study, the report satisfies the study objectives ofdescribing alternatives and impacts ofair visibility regulations on the Navajo Generating Station ("NGS"). The report captured some important aspects ofNavajo Nation ("Nation") concerns and perspectives regarding impacts to the Nation. However, the report disregarded a number ofimportantprimary references that are considered by the Nation as significant in understanding the larger context ofNGS and the impacts ofair regulations, particularly the non-air quality impacts. The Nation submitsthe following comments.
Trust Responsibility Understandably, the time limitations and scope ofthe study precluded an examination ofa number ofissues and topics that the Nation advocated for inclusion to convey a more realistic portrayal ofthe importance offederal responsibilities to tribes in the context offederal rulemaking. USEPA, like all federal agencies, bears a trust responsibility to Indian tribes that derives from treaties and federal common law. The trustresponsibility includes the obligationto consult with tribes when agency action is likely to affect them. The duty to consult is memorialized inExecutive Order 13175 and USEPA's ownPolicyon Consultation and Coordination withIndian Tribes. Tribal consultations are necessary to evaluate any substantial, direct etlects that agency decisions will have on tribes. In the BART determinatjon for NGS, USEPA will make a regulatory decision concerning a coal-fired power plant located on the Nation pursuant to a lease approved by the Navajo government. The KayentaMine, located on Navajo Land, which produces the coal fuel for NGS, also faces impacts from the BART determination. While a BART decision for NGS has the potential to have far-reaching implications for many Indian tribes, no tribe will be affected more significantly thanthe Navajo Nation.
Permit Limit Unchanged
TheNation had recommended a change to the Pre-LNB/SOFA permit limit that appeared in the table for NOx Permit Limits and Technological Performance in the draftNREL study. However, the Nation notes that the Pre-LNB/SOFApermit limit is unchanged in Table 3-2. The Nation recommended a correction to reflect the change 0[0.36 Ib/MMBtu to OAO JbIMMBtu, and a change in the percentreduction from 33% to 40% reduction. This also remained unchanged.
Models, Future Studies and Other Evidence-Based Reports Throughout the NREL study, numerous qualifying statements allude to improvements in instruments, such as studies, models and other evidence-based reports that couldprovide better interpretation, analysis, and understanding ofthe wide-range ofissues implicated by the BART rulemaking for NGS. The potential to increase the understanding ofstakeholders, including USEPA, regarding the issues surrounding NGS and the impacts ofair visibility regulations can be addressed partly through objective analysis ofimproved modeling results that USEPA refuses to accept and new studies and reports that currently do not exist.

1TheNation continues to support future dedicated efforts, particularly support by the respective federal agencies, that will result in studies or reports that can be used to chart courses to achieve the best reductions in emissions, and simultaneously continue to meet the economic and environmental needs ofthe Nation.
GroundwaterIssues
The study discusses concerns raised by NGOs about alleged injury to groundwater attributable to the Kayenta Mine. TheNation has participated in numerous assessments ofthe impacts ofthe mine's groundwater use. These include the on-going USGS BlackMesaMonitoring Program (http://az.water.usgs.gov/projects/967L-9E9/), development ofgroundwater models by the USGS and others, and participation 

### in preparation ofCumulativeHydrologic ImpactAssessments by OSMRE. Based on these assessments, the Nation has concluded that the mine'spumping has not affected water quality, and drawdown effects are localized and temporary. Pumping from the N-Aquifer does not impact springs issuing from overlying aquifers; the data on impacts on NAquifer springs are inconclusive. Visibility Science

The section ofthe study pertaining to visibiLity science effectively related that there have been significant reductions in regional S02 and NOx emissions. The reductions have occurred in large part due to federal rules established to improve visibility in Class I areas, including the install.ation ofemissions controls at NGS, and the Nation assuming its role as environmental regulator for purposes ofthe CleanAir Act ("CAA"). Most notably, NGS voluntary installed 

### LNB/SOFA during the period from 2009 to 2011, meeting the presumptive BART limits for NOx, which Iikely contributed to the overall decline in emissions ofS02 and NOx. TheNation concurs in the findings in this section and finds the information encouraging with respect to the potential for future collaboration among agencies to design studies that will serve in the evaluation ofvisibility improvement and use ofappropriate control technology that will meet the national visibility goal while protecting tribal resources. The fact that there are different and somewhat conflictingpositions on whether installation ofSCR will result in perceptible visibility improvement underscore the need to strengthen, and collaborate on, the best methodology(ies) to use in evaluating the degree ofimprovement in visibility on a case-by-case basis. Finally, the Nation does not concede that SCR is BART for NGS. The Nation continues to support a detennination that

### LNB/SOFA is BART for NGS.LNB/SOFA presents the best scenario for meeting BART, with reasonable costs ofcompliance that wiH mitigate the economic impact to the Nation. The Nation has previously stated, in its comments to the Advance Notice of Proposed Rulemaking, that it supports a phased approachto emission controls consistent withthe glide pathto pristine conditions. Installation of

### LNB/SOFA as a first step is consistent with the CAA and the Regional HazeRule, and satisfies the BARTrequirement for the currentplanning period.

2From: doug.kupel@phoenix.gov [mailto:doug.kupel@phoenix.gov] Sent: Monday, February 06, 2012 12:44 PM To: NGS_Report_Comment Subject: City of Phoenix Comments on Navajo Generating Station NREL Study

City of Phoenix Comments on "Navajo Generating Station and Air Visibility Regulations: Alternatives and Impacts"

The City of Phoenix (City) has a large interest in projected impacts from the Navajo Generating Station (NGS) being required to adopt Selective Catalytic Reduction (SCR) or SCR plus baghouse and sorbent injection (SCR plus BH&SI) as Best Available Retrofit Technology (BART) to control NOx emissions. The additional possibility of plant closure, now raised as an alternative in the NREL report, and the resulting projected increase in CAP water rates for municipal and industrial users estimated from $33.00 to $64.00 per acre foot, could have serious implications on water rates in the City and for the City's water customers.
The population in the City's water service area is an estimated 1.455 million persons based on the 2010 US Census. The Phoenix service area represents about 39 percent of Maricopa County's population and 23 percent ofthe total population of Arizona. The incorporated area of Phoenix covers 546 square miles. In addition to the Phoenix service area, the City also serves portions of the Town of Paradise Valley and provides treatment services to adjacent providers on a limited basis. In a normal supply year, the City meets more than 90 percent of its water demands from surface sources. These include water from the Salt and Verde Rivers delivered through the Salt River Project and waterfrom the Colorado River delivered by the Central Arizona Project. For the years from 2007 thru 2010 forty-four percent (44%) of the City's surface water supplies were delivered through the CAP.
Costs for CAP water form a large percentage

- from 75 to 80 percent

- of the City's overall cost for water. The City and its water customers have strong concerns regarding financial and water supply impacts that may stem from the three proposed actions discussed in the NREL report.

In October of 2011, the City provided information requested by NREL during the study. We appreciate the opportunity to provide these comments on the final report.

1. Large increases in costs to install. operate. and maintain additional controls for the NGS will reduce the affordability of water and energy in central Arizona. These increased costs could have a negative impact on the local and regional economy.
2. High energy prices and resulting higher rates for CAP water could reduce the ability of water users in Arizona to purchase CAP water. As one example, these increased CAP water costs might negatively impact the ability of the Arizona Water Banking Authority (AWBA) to store water in anticipation offuture droughts and shortages. With the addition of increased CAP water costs due to emissions controls at NGS, the ability of the AWBA to store water for emergencies could be hampered. Ifthe AWBA is unable to meet the City's need for water banking the City would likely have to expend additional resources to acquire and develop otherwater supplies for drought protection.

3. The City anticipates that it will continue to use CAP water even if the price ofthat water increases. A major reason that the City must have CAP water is to demonstrate that it has a 100 year Assured Water Supply (AWS) or it will be out ofcompliance with state law. As a matter of state law, water providers in Arizona must demonstrate a 100 year AWS that must be based primarily on renewable supplies such as surface water. The main goal of this legislation is to reduce reliance on non-renewable supplies such as groundwater in order to achieve "safe yield" as required by the 1980 Arizona Groundwater ManagementAct. While the rationale for concluding that CAP demand is inelastic appears to have been based on the fact that municipal water providers do not have alternate supplies to replaceCAP water should prices rise, this does not imply that the price increase is free from impacts.

4. Because the report assumes that CAP water use will be unaffected by price increases, the report does not recognize the potential impact ofsignificant increases in the cost of CAP water on both existing and future Indian water rights settlements. Existing settlements may be challenged by increasing CAP costs. As part ofthese settlements, Phoenix leases or plans to lease CAP waterfrom several Tribes, including the Fort McDowell Indian Community, the Salt River Pima-Maricopa Indian Community, the Gila River Indian Community, and the White Mountain Apache Tribe. These settlements and leases are the foundation for the successful resolution of long-standing water rights issues in central Arizona.

5. Affordable water is a fundamental resource that affects the health and well-being of Arizonans. Substantial increases in electrical generation costs at the NGS more than likely will be passed on to Phoenix residents and businesses through increased water rates. This creates a hardship for those ratepayers. Phoenix must protect its ratepayers by keeping rates as low as possible while maintaining a strong and reliable system. Increased energy costs attributable to emission controls for visibility improvements may compromise this delicate balance.

Douglas E. Kupel, Ph.D.

For Jerome E. Miller Deputy City Manager City of Phoenix Law Department 200 W. Washington, Suite 1300 Phoenix, A 85003-1611 doug.kupel@phoenix.gov (602) 495-5853Paul R. Orme, P.c. 2850 E. CamelbackRd. Phoenix, Arizona 85016

Ladies & Gentlemen:

This communication provides the comments ofthe Central ArizonaIrrigation and Drainage District (CAIDD), Maricopa-Stanfield Irrigation & Drainage District (MSIDD) and New Magma Irrigation and Drainage District (NMIDD) (the "Districts") on the above referenced NREL NGS Study. I serve as General Counsel to the Districts, which combined, serve Central ArizonaProject ("CAP") water to over 200,000 acres in Pinal County, Arizona.

In 2011, the Districts delivered nearly 500,000 acre feet ofCAP water, both for direct and in lieu storage uses, to their growers and landowners. These deliveries constitute roughly 70% oftotal CAP agricultural water deliveries in 2011. In addition, MSIDD and CAIDD also pumped substantial amounts ofgroundwater for delivery to their growers from wells either owned or leased by these Districts. The farming in these Districts, as well as neighboring districts and Reservations, constitute an importantpart ofthe local and regional economy for Central Arizona.
The foregoing background is important because the NRELNGS Study significantly underestimates the amount ofCAP water currently being utilized by non-Indian agricultural users. In addition, it severely underestimatestheprice impact on those non-Indian agricultural users should either the Sel.ective CatalyticReduction ("SCR") scenario, the SCRplus Baghouse & Sorbent Injection ("BH & SI") scenario, or the NGS Shut Down scenario, be the final BART as determined by EPA.
Theprimary focus ofthese comments is on Chapter 4, "Central ArizonaProject and Navajo Generating Station". Nevertheless, it is extremely important to focus on the legal standard EPA must follow in making its BART decision:

"

...take into consideration the costs ofcompliance, the energy and non air quality environmental impact ofcompliance, any existing pollution control technology in use at the source, the remaining useful life ofthe source, and the degree ofimprovement in visibility which may reasonably be anticipated to result from the use ofsuch technology." (Emphasis Added)

TheNGS Shut down scenario clearly does not meet the BART legal standard when considering the impact on the Tribes as setforth in Chapter 6, and the unclear and highly disputable beneficial impact on air visibility as outlined in Chapter 5,. A more comprehensive analysis by NREL onthe economic impacts ofall but the "Base" scenario on Indian and non-Indian CAP agricultural water users alike would have revealed a similar result. Figure 4-2 on page 58 ofthe NREL NGS Study indicates that non-Indian Agriculture received deliveries ofonly 400,000 acre feet in 2010. This chart does not take into account the considerable amount ofwater under contractto "M&I Subcontractors", "M&l Excess" contractors, and "Federal Subcontract-OffReservation" users that actually were delivered to non-reservation agricultural lands for in-lieu storagepurposes. Whenthese amounts are taken into consideration, the non-Indian agriculture sector uses over 50% oftotal CAP water deliveries annually. This serves two important federal and state water policy goals. It allows Arizona to utilize its full CAP annual entitlement which was one ofthe primary purposes ofthe creation ofthe Arizona Water Banking Authority and in-lieu storageprograms. It also serves to significantly reduce groundwaterpumping in Central Arizona, a key conditionofthe original CAP Enabling Legislation in 1968. Thesecritical water management goals would be placed injeopardy should CAP agricultural water cost be increased by the EPA BARTdecision as outlined in Chapter 4.
Evidence ofthe foregoing was presented to NREL representatives on September21,2011 by members ofthe agricultural CAP water user community at the offices ofMSIDD. Attending that meeting was a representative from Farm Credit Services, the primary agricultural crop financing entity in Central Arizona. He presented to NREL annual crop budgets that clearly show current water costs as the highest input cost for farmers inDistricts receiving CAP water. The Farm Credit study provided to NREL concluded the following:

"From a competitive standpoint, the Pinal County water districts have some ofthe highest water costs in areas financed by Farm Credit Services Southwest. 

### Ifwater costs were increased by $16.30 (per acre foot), it would raise the per acre cost by $44

...leaving a negative margin which is not flnanceable." (EmphasisAdded)
Nowhere does this discussion or documentation appear in the NREL Study. Instead, on page 60, the following conclusion is stated: "Althoughhigh prices for CAP water may prompt some water users to seek other available water sources, there is no easy way to quantifY such a curtailment in CAP water demand. Therefore, the analysis 

### in this section
assumes that CAP water demand willremain fixed regardless ofprice."

The underscored portion ofthis conclusion is clearly erroneous and cannot be supported by the clearly understandable data presented to NREL. 

### Ifcrop financing is not available due to much higher water costs, CAP water use will be substantially reduced, agricultural lands will go out of production, and the local economies will suffer. It's troubling thatNREL made no effort to include these analyses let alone evaluate their merit. In section 6.2, reference is made to reduced farm profit margins for the Gila River Indian Community as a result ofselection ofcertain BART scenarios by EPA, but no such comment is made regarding non-Indian agriculture when similar data provided by MSIDD, an adjacent neighbor to GRIC. Recent history for these Districts illustrates that when CAP water costs substantially increase, CAP water use dramatically decreases, groundwater use increases to a degree, and lands go out ofproduction. This exact scenario resulted in two ofthe Districts seeking municipal bankruptcy protection in the 1990's. These results are muchmore severe than "reduced margins". Again, it must be emphasized that the only "other available water sources" for most ofthe Districts is pumped groundwater, which, as mentioned previously, runs at cross purposes with the CAP enabljng legislation.

The critical impact ofthe BART decision on the 2004 Arizona Water Settlement Act, is referenced only in passing. One such impact is the lostpromise of"affordable" CAP water for Indian and non-Indian agriculture water users (until 2030) which was a key to achieving the final settlement. Should EPA undo this important benefit agreed to in contract by the Department of Interior, and blessed by Congress, much ofthe settlement could unravel and the resulting chaos in the Arizona Water Community can notbe overstated.

In conclusion, althoughNREL accurately predicts resulting cost increases to CAP water users (including agricultural water users
- as clarified above) under the various BART scenarios, it fails to draw some obvious conclusions which are clearly relevant in applying the legal standard of "cost ofcompliance" which EPA must follow in making its BART decision. Hopefully EPA will not ignore these clear conclusions as well.Water Resources

PHONE 480-312-5685 9388 E. San Salvador FAX 480-312-5615 Scottsdale, AZ 85258 WEB www.ScottsdaleAZ.gov

6 February 2012

VIA EMAIL: NGSReportComment@ios.doi.gov Department ofthe Interior Washington DC

RE: Report regarding "Navajo Generating Station and Air Visibility Regulations: Alternatives and Impacts" prepared by the National Renewable Energy Laboratory ("NREL")

The City of Scottsdale, Arizona Water Resources Division provides drinking water and sewer service to more than 87,000 customers within Scottsdale, which is located in the metropolitan Phoenix area of central Arizona. We are the third largest subcontractor for Central Arizona Project (CAP) municipal water in the state, and we expect to rely upon CAP water for over twothirds ofourprojected demand for potable water.
The CAP relies exclusively on the NGS to supply the energy needed to deliver water to its customers, including Scottsdale. Therefore, we have a great deal at stake in the outcome ofthe BART rulemaking currently underway at EPA. The NREL study is a key input into EPA's development ofthatrule. We read it with great interest, and appreciate the opportunity to comment
on the report and its findings. Our comments wiH focus primarily on those aspects ofthe report that relate to the direct cost impacts on the City ofScottsdale as a CAP water customer.
Scottsdale is supportive ofprotecting our environment. However, it appears some ofthe emission control alternatives go beyond providing reasonable and rational environmental protection to the point ofrequiring significant financial commitments with no guarantee ofachieving perceptible visibility improvements as ajustifiable return onthose investments.
The use ofCAP water is a critical component ofScottsdale's long-term water supply sustainability strategy. Key components ofthis strategy are maximizing use ofrenewable water supplies while minimizing groundwater pumping, reusing reclaimed wastewater for non-potable purposes such as golf course irrigation, and recharging our groundwater aquifer in order to balance any necessary groundwater pumping. Any increase in the cost orCAP water (the City's primary renewable water supply) would negatively affect the City'S ability to continue to provide an assured and sustainable water supply for its customers. The various cost alternatives evaluated in the report could result in increases in the City's raw water costs ofup to 52%. This increased water cost would directly result in a significant rate increase to the City'swater customers.

### The report concludes thatthe only alternative proposed that would significantly increase the cost ofpower to CAP's municipal water customers is the complete shutdown ofthe NGS. It 

### infers that this shutdown is unlikely. This conclusion ignores the critical relationship between the timing ofthe BART determination and the resolution ofnumerous uncertainties surrounding continued operation ofthe NGS and the Kayenta mine beyond 2019. These uncertainties, combined with the potential increase in costs associated with installing emission controls, could very well result in

### a decision by the plant's owners to shutdown the plant in a time frame that would leave very little opportunity for CAP to develop alternative and affordable power sources to theNGS.
Another issue ofdirect concern to the City is the cost burden that installation ofunreasonable emissions controls on the NGS would impose upon the Tribal users ofCAP water, particularly the potential availability ofpower revenues from the Lower Basin Development Fund. These funds were a key component ofthe Arizona Water Settlement Act, and we are concerned that settlements may be challenged on the grounds of a breach offederal trust responsibility to the Tribes and that future settlements couldbe derailed by increasing CAP water costs

.. The City is a party to water rights settlements with several Tribal CAP customers. These settlements have helped provided the City with water supply certainty by settling ofsignificant tribal water rights claims. Scottsdale has also entered into leases with these communitieS, which are a major component ofthe City'S water supply. The reopening and renegotiating ofany ofthese settlements would increase the uncertainty related to our water supply future. This is of great concern to the City ofScottsdale as it works to provide a secure sustainable water supply for its citizens. Again, we appreciate the opportunity to review and comment on the NREL report. We urge the EPAto fully consider the critical role that the NGS plays in providing a sustainable water supply future for Arizona as it evaluates this report andproceeds with the BARTrulemaking. We look forward to further participation inthe rulemakingprocess.

ElizabethMill Water R sourdks Advisor City ofS ottJlale Water Resources Division 9379 E. San Salvador Dr Scottsdale, AZ 85258

### Comments on National Renewable EnergyLaboratoryTechnical Report Navajo Generating Station and Air Visibility Regulations: Alternatives and Impacts Prepared by: Salt RiverProjectAgricultural Improvement and Power District Address: P.O. Box 52025 PAB352, Phoenix, Arizona 85072-2025
Salt River Project AgricuJturalimprovement and PowerDistrict (SRP) appreciates the opportunity to provide comments on the technical report prepared by the National Renewable Energy Laboratory (NREL) on the Navajo Generatjng Station (NGS) ("NREL Report"). SRP is
apolitical subdivision ofthe State ofArizona that provides retail electric services to more than 930,000 residential, commercial, industrial, agricultural and mining customers in Arizona. SRP is an owner ofNGS and is the operating agent for theplant.

SRP's comments on the NREL Report are outlined below. SinceNREL restricted comments on the report to two pages, this document was prepared to comply with that limitation. SRP wi 

### U submit more detailed comments on the report in a separate document.


### 1. 

### NREL's assessmentof visibility science clearly supports SRP'sposition thatSelective CatalyticReduction (SCR) is notBestAvailableRetrofit Technology (BART)for NGS.

In its assessment ofvisibility science in Chapter 5 ofthe report, NREL reaches conclusions that
are missing fTom the Executive Summary and Conclusions sections ofthe report, and are critically important in the pending BART determination for NGS:

• Page 76: "[Sulfur dioxide] S02has been the initial focus [ofpowerplant emission control requirements] because sulfate has a larger impact onregional haze compared to nitrate."

• Page 92: "Measurements specific to this region indicate that actual visibility impacts [from nitrogen oxide emissions] may not be as great as those estimated by CALPUFF v5.8 as applied by EPA."

• Page 90: "Installation of(Selective Catalytic Reduction] SCR technology on Navajo GS would result in a calculated cost/benefit ratio [in dollars per deciview] larger thanthose calculated for [Best Available RetrofitTechnology] BART controls proposed for other units in the region

....even ifEPA determines that these other facilities should install SCR, the cost/benefit values for Navajo GS based on EPAmodeling/analysis for Navajo would be higher.

.."

NREL's assessment ofvisibility science clearly supports SRP'sposition that SCR is not BART for NGS. NREL's conclusions in this chapter are further supported by the data provided in SRP's updated BARTreport submitted to the United States Environmental Protection Agency (EPA) on January 20, 2011.

2. 

### NREL's economic analysis is flawed because it ignores criticalconsiderations involvedin
a decision to keepNGS online.

NREL's statementthat the cost ofSCRand baghouses is less than the cost ofshutting down

SRP'sComments on NREL NGS Report Page 1NOS and replacing it with purchased power ignores the following considerations:



### • SiteLeaseandCoalSupply Costs. NREL's analysis is conducted based on the current cost ofoperatingNOS. In reality, the future cost ofcoal and the plant site lease will be meaningfully higher due to the renegotiation ofthe existing agreements, assuming that those agreements can be successfully extended.



### • CostRecovery Timeline. The report assumes that the capital costs associated with SCR would be recovered over 20 years. However, from an investment riskperspective, each
owner must also take into consideration the possibility that those costs may need to be recovered by 2019 in the eventthat the equipment is installed and the plant is still shutdown due to other factors.



### • AssumptionsaboutResourceAlternatives. The report assumes thatNOS capacity could be easily replaced with marketpurchases since there is excess capacity in the region. While this may be the case from a near-term regionalperspective, the assumption is inconsistent with autility'S obligation to serve its customers, which requires dependable capacity and cost control. These requirements are not met with an assumption ofmarketbased energy purchases. Moreover, to the extent load continues to grow, any excess regional capacity will diminish and the capacity will need to be replaced.



### • Uncertainties Concerning Future Ownership. The continued participation ofeach of the owners, especially LADWP, is uncertain for the reasons discussed by NREL on Page 10 ofthe report.
NREL should have clearly recognized that if the EPA requires costly additional emISSIOn controls such as SCR as BART, the NOS owners would be forced to decide whether to make large capital investments without any certainty that the plant could continue to operate beyond 2019 and without certainty regarding the future costs of operating NOS due to the potentially higher lease and coal costs. These factors could put the plant at a significant risk ofclosure. NREL's economic conclusions are flawed because they fail to account for these considerations.


### 3. While the report does notrecommendorendorse aspecificcontroltechnology asBART, it clearly supportsSRP'sposition tltatLow-NO x 

### Burners andSeparated OverfireAir (LNB/SOFA) is BART forNGS.

TheNREL Report was commissioned to provide factual and objective information to the United States EnvironmentalProtection Agency (EPA) for consideration inthe development ofa BART proposal for NOS. The requirement to assess and install BARTcomes from EPA's Regional Haze Rule (RHR). The RHR requires BART to be determined based on a case-by-case evaluation ofeach control option, considering factors such as the cost ofeach technology and the degree ofvisibility improvement that can be achieved by eachtechnology.

NREL concludes that it is not clear that installing SCRwould result in aperceptible visibility improvement at nearby national parks and wildemess areas (Class I areas). NREL also acknowledges the significantly higher capital cost ofSCRrelative to LNB/SOFA. This significantly higher SCR cost, coupled with NREL's uncertainty regarding whether SCRcan achieve aperceptible improvement in Class I areas, supports SRP'sposHion that LNB/SOFA - a technology voluntarily installed by the NOS owners between 2009 and 2011

- is BARTfor NOS.

SRP'sComments on NREL NGS Report Page 2

## WESTERN RESOURCE ADVOCATES
February 6, 2012

U.S. Department ofthe Interior NGS_Report_Comment@ios.doi.gov

RE: Comments on NREL Report, Navajo Generating Station andAir Visibility Regulations: Alternatives andImpacts

Western Resource Advocates hereby submits its comments on the NREL report cited above. We are joined in these comments bythe Grand Canyon Trust, the Sierra Club, the Environmental Defense Fund, and Forgotten People.

We recognize the vast amount of review and analysis undertaken in the preparation ofthe report and commend NREL for accomplishing a wide range of assessments within a very limited time period. In these comments we address the report's conclusions: a) thatthe cost of SCR is likely less than the cost of shutting down the Navajo Generating Station (NGS) and replacing the foregone power and energywith purchases from the market, and b) that early retirement of NGS must necessarily be inimical to the Navajo Nation and Hopi Tribe.

The all-or-nothing options studied for NGS are inappropriately narrowand stuck in time; what's also needed is a forward-looking analysis that considers afull range of scenarios for a gradual transition from coal to cleaner resources. In particular, the report evaluates only two sets of options

- a) continued operation of NGS with a set of possible environmental controls to reduce some emissions, and b) complete shutdown of NGS and replacement ofthe energy and capacity with wholesale market purchases.

Given the complexity ofthe situation and the need to invent more creative solutions, additional options must be addressed as is being done regarding the Four Corners power plant. One such option is an early shutdown of one or two NGS units and replacement of some ofthe foregone energy and capacity with renewable resources. This might occur, for example, ifsome owners of NGS turn to other resources while the Bureau of Reclamation continues to receive power from one ofthe NGS units. Investment in renewable resources could benefit the Navajo Nation and Hopi Tribe by providing income and jobs and while reducing air pollution.

COLORADO· 2260 BASELINE ROAD, SUITE 200 • BOULDER, CO 80302 ·303.444.1188 • FAX: 303.786.8054 • EMAIL: info@lwestemresources.org NEVADA. 204 N. MINNESOTA STREET, SUITEA • CARSON CITY, NV 89703 • 775.841.2400 • FAX: 866.223.8365 • EJI,iAIL: info@lwesternresources.org

NEWMEXICO. 409 E. PALACE AVENUE, SUITE2 • SANTA FE, NM 87501 • 505.820.1590 • FAX: 505.820.1589 • EMAIL: info@lwestemresources.org UTAH· 150 SOUTI-I 600EAST, SUITE2AB • SALT LAKECITY, UT 84102 • 801.487.9911 • EJI.1AIL: utah@lwesternresources.org
www.westernresourceadvocates.orgThe studyfails to explicitly account for important aspects of energy industry economics, such
as uncertain coal prices, uncertainty over what happens to LADWP's share of NGS, and safeguards against the costs of complying with possible future carbon dioxide regulations. At 16 million metrictons in 2010] NGS is the largest emitter of carbon dioxide in Arizona and one ofthe largest in the nation (http://ghgdata.epa.gov/ghgp/main.do).This situation imposes a significant risk on the plant owners by exposing them to the potential cost of complying with future regulation of greenhouse gases.

The NREL report does not address the health impacts of operating NGS orthe health benefits of reducing emissions from the power plant. The Clean Air Task Force (http://www.catf.us/coal/problems/power plants/existing!) presents estimates ofthe health impacts offine particulate matterassociated with NGS emissions in 2010. These include the following annual impacts at a combined cost of$128 million ayear: 16 premature deaths] 25 heart attacks, 300 asthma attacks] 12 hospital admissions] 11 chronic bronchitis cases, and 15 asthma emergency room visits. Over a 1S-year period, these are large impacts on the public.

Additional work should be carried out to assess the health benefits of reducing emissions from NGS] including retiring some or all ofthe units and replacing them with cleaner resources. Such studies have been conducted in other cases. One example is found in the Declaration of George D. Thurston in Opposition to Petitioners' Motion for Stay] Public Service of New Mexico
v. EPA] filed in the u.S. Court ofAppeals] Tenth Circuit] Case No. 11-9557. Another example is the Supplemental Answer Testimony of Leland Deck in Docket No. 07A-447E before the Colorado Public Utilities Commission] filed on May 27, 2008 on behalf of Western Resource Advocates.

In sum, resolution ofthe air pollution problems at NGS requires a much more comprehensive analysis that considers realistic transition options, health impacts, and uncertainties in coal costs and costs of compliance with potential future environmental regulations. The NREL analysis is simply too constrained to lead to any policy conclusions.

We appreciate the opportunityto provide comments on this important matter and urge the Department ofthe Interior and EPA to address the many issues surrounding the future of NGS] to accelerate the transition to cleaner energy resources to benefit Arizona] the tribes] the agriculture sector] and the environment] and to foster creative solutions among stakeholders.

David Berry Chief of Policy Analysis Western Resource Advocates

2ARLEN QUETAWKI, SR. Governor PUEBLO OF ZUNI LORENL. LEEKEI.A, SR. Councilman

# ~~~**~~** STEVEK. BOONE Lt. Governor P.O. Box 339 1203-B State Highway 53 GERALD HOOEE, SR. Councilman

.. '

.. ARDEN KUCATE Zuni, NewMexico 87327-0339 MARKMARTINEZ Head Councilman www.ashiwi.oyg Councilman VACANT 505-782-7000**(~)** BIRDENASANCHEZ Councilman 505-782-7202 (&!L) Councilwoman

Officially known asthe ZWli Tribe ofthe ZWli Indian Reservation February 1,2012 Letty Belin, Counselorto the Deputy Secretary 

### U. S. Departmentof Interior 1849 

### C StreetNW Washington, DC 20240

RE: Comments onNavajo Generating StationandAirVisibility Regulations: Alternatives and Impacts

DearMs. Belin,

ThePueblo ofZuni provides thefollowing comments ontheNational Renewable Energy Laboratory (NREL) Analysis oftheNavajo Generating StationandAirVisibility Regulations: Alternatives andImpacts datedJanuary2012.

ThePueblo ofZunihas beenpursuingrenewable energyprojects opportunities, andrecently completedfeasibility studies ofseveral solarpowergenerationprojects on its lands inArizona and NewMexico. Zuni has excellent solarresources, very goodproximityto high voltage electric transmissionlines, and suitableproject sites. Proposed solar projects from 10MWto 200 MW are consideredfeasible attheir current sites atLich-N- HavenlDavisinArizona and WesternBorderin NewMexico. Zuni ispursuing\development atthis time, withtheintentionto constructprojects within a 2 to 5 - yeartime horizon. Zunirequeststhatitsproposed solar generationfacilities beincluded inthe supplemental study plannedbyNREL aspossiblereplacements for some oftheNavajo Generating Stationelectric generation, shouldNGS be shutdown. Zuni is also interested inparticipationin a possibletribal consortiumefforttoreplaceNOS generation discussed atthe Inter-Tribal Council ofArizona January 27,2012meeting. WelookfOlWard tothe release offurther analyses ofthe options and wouldbepleasedtoprovide additional informationas needed. Sincerely,Enclosure EPA Corrections to NREL Phase I Study on Navajo Generating Station


### 1. EPA regulatory actions on pages 12 and 14 are not accurately described. The Report states that the plant will be subject to a number ofregulations and implies that they will require additional investments. In many cases, we do not know whether NGS would be affected (e.g., in cases where standards have notbeen set, rules have not been finalized, or designations have not been completed). IfNGS were affected by many ofthese actions, it is likely that actions NGS has already taken or will take for MATS or BART would cover some oftheir obligations. Therefore, except in the case offinalized rules, EPA actions should be presented as "potentially affecting NGS," including in the title ofthe table onpage 12.

a. Utility Mercury and Air Toxics Standard. The report incorrectly states thatMATS sets emission limits for organic compounds. The final rule sets workpractice standards for organic compounds. b. Cooling water intake. The rule will "minimize" not "prevent" impingement/entrainment ofaquatic life.

c. Coal CombustionResidues. EPA has no public date for finalizing this rule. The status should read "pending". The summary should read "EPA has proposed to regulate coal ashto address the risks from the disposal ofthe wastes, such as residues from the combustion ofcoal in powerplants, generated by electricutilities and independent powerproducers. The target date for release ofa final rule will be detennined pending a full evaluation ofall the infonnation and comments EPAreceived onthe proposal." d. Ozone and PMNAAQS. The report states that EPA has proposed a revised ozone standard. In September2011, 

### EPA chose not to finalize thatrevised standard and instead has begun implementing the ozoneNAAQS promulgated in 2008. EPA is also conducting the 5 year review ofthe ozoneNAAQS required by statute and expects a proposal in 2013. As a result, the schedule box for this action should read "pending". The text under "summary ofaction" for the PM NAAQS should also be used for the summary ofaction for the ozoneNAAQS. Finally, since the ozone and PMNAAQS
are the same type ofprocess now, both should be characterized as "reviews" or neither should be characterized as a "review."

e. Transport Rule. Also on the table on pg. 12, the TransportRule II is no longer on EPA's Regulatory Agenda. As a result, this rule should be removed from the table. 

## r. Utility Boiler GHG NSPS. The Summary should read "EPA is under a court settlementto set NSPS standards for this source category for GHG emissions. Under the NSPS provisions, the agency will also establishguidelines for states to use in regulating existing sources such as Navajo GS. This process could lead to GHG requirements for Navajo GS. g. California SenateBill 1368. The California GHG emission perfonnance standards does not impose any requirements on NOS, rather it affects one ofthe co-owners of NGS (Los Angeles Department ofWater and Power). We suggest the text be adjusted to reflect this.

12. The discussion onMATS onpage 51 is not current

- it describes thepotential need for baghouses and sorbent injectionto control S03 and sulfuric acid mist (both contribute to the condensable fractions ofparticulate matter). The final MATS rule set a filterable only PM limit of

### 0.03 Ib/MMBtu, therefore, discussion ofS03and sulfuric acid controls is not relevant for MATS implementation and should not be characterized as such. EPA notes that
source tests show that NGS generally already achieves 

### 0.03 Ib/MMBtu (filterable PM). Additionally, references to proposal and final rule dates associated withMATS are inconsistent in the report and donot correctly distinguish between signature dates and publication dates. Thepublication date ofthe final MATS rule in the Federal Register is February 16,2012. 3. In Table 3-11 on page 51, the costs labeled "SCRwith sorbent injection and polishing baghouse" appear to be consistent with Sargent and Lundy cost estimates for SCRand DSI only (i.e., polishing baghouse not included). As noted above, theses costs are unlikely to be applicable to MATS implementation based onthe final MATS rule. 4. Page 88. Most sources will have 4 years to comply with MATS, until early 2016 (3 years available to all sources 

### + 4th year that EPA expects to be widely available from permitting authorities to enable sources to complete compliance activities). 5. Table 5-1 onpage 75 reports emissions ofNOx and S02 emissions that are identical. This appears to be a typographical error. 6. The narrative describing Table 5-6 on page 84 and the numerical values in the table are inconsistent. The narrative describes a reduction in nitrate concentrations over time, butthe values in the table shows a dramatic increase. Additionally, thepercentreductionnumbers do not seem to reflect the actual values in the table. 7. Onpage 93, the statementthat Mohave Generating Station in southeasternNevada closed at the end of2005, due largely to the cost ofretrofitting the powerplant with S02 scrubbers is misleading. EPA understands that the spray dryers with high velocity baghouses were expected to cost $250 million, and that additional expenses at the time that were unrelated to the new scrubbers included a new slurry pipeline ( $250 million) and upgrades/life extension ofthe plant 

### ($500 million) were three times higher than the cost ofnew controls. Therefore, Mohave closed inpart, due to the cost ofnew airpollution controls, but many other factors existed that affected decisions related to closure. 8. Onpage 101, the report is misleading in its description ofthe permitting ofDesertRock. AlthoughEPA requested a voluntary remand ofthe final permit to incorporate new applicable requirements, the project applicanthas not responded to our multiple requests for
an amended permit application; we most recently sent a Jetter in December 2011 and will follow up with another letter providing a deadline after \vhich we wilJ consider the application withdrawn. 9. Table 3-4 onpage45, should also list Springerville Units 3 and 4 as plants with installed SCRtechnology. Although Springerville is operated by Tucson Electric Power, Unit 4 is owned by SRP. These units came on line in 2007 and 2009. 10. The information onpages 45-47 should include any available cost information for the planned retrofit ofUnit 2 at Coronado Generating Station

- another SRP facility. The ConsentDecree for Coronado requires the SCR be installed and operational by June 1, 2014.

211. Onpg. IV ofthe Executive Summary, the report states thatLNB with SOFAhave reduced NOx emissions at the plant by 40% relative to the plant's airpennitbefore controls were added. Thepercent control would be lower**(~30%** reduction from LNB/SOFA) ifthe calculationwas done comparingpre-project actual emission rates to limits after installation ofLNB/SOFA. 12. Onpg IV ofthe Executive Summary, the report then cites a 78% reduction ifSCR were installed and 50-60% reduction ifSNCR were installed. A control efficiency of50-60% from SNCRis higher than typically 

### cited for SNCR alone. SRP recently estimated SNCRcould achieve 0.15

- 0.] 8 lb/MMBtu at NGS (a 25

- 38% reduction on top ofperrnitted JeveJs of 0.24 Ib/MMBtu with LNB/SOFA). Because LNB/SOFA is already instaJled and operational at NGS, control efficiencies from SNCRand SCRalone should either be calculated using a baseline of0.24 lb/MMBtu, or if0.35 lb/MMBtu is used as the baseline, should be reported
as a control efficiency based on SNCR + LNB/SOFA or SCR+LNB/SOFA (i.e., to be more consistent with values reported in Table 3-2 ofNREL report).

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