EXhibit 3

STATE OF CONNECTICUT

DRPARTMENT OF RNVmONMENTAL PROTRCTfON

STATE OF CONNECTICUT

and

COMBUSTION ENGINEERING, INC.

TRADING AGREEMENT and

ORDER NO. 8154

MODmCAnON No.3

TR.-\DING AGREEMENT AND ORDER MODIFICATION

In the matter of a Trading: Agreement and Order berNeen the Commissioner of Environmental Protection

("Commissioner") and Combustion Engineering, Inc. ("CE").

WHEREAS, the Commissioner and CEo having agreed to the tenns and conditions set forth in

Trading Agreement and Order No. 8154 issued on December 11, 1997, and a Modification thereto issued

on June 3, 1998, do now, by mutual agreement, modify Trading Agreement and Order No. 8154;

WHEREAS, paragraph C.6. of the terms and conditions set forth in Trading Agreement and

Order No. 8154 issued on December II, 1997, state that "FLERs, stack test rates and fuels in Tables I

and 2 may be modified only after the consent of the Commissioner by written modification of [his

Trading Agreement and Order" ;

WHEREAS, CE has completed Department of Environmental Protection (''DEP'') approved

stack testing when firing #6 fuel oil for boilers Nos. 3, 4, and 5 on 3/4/98, 4/22/97 and 4/18/97 and the

results have been approved by the DEP; and,

WHEREAS, the Commissioner and CE, having agreed to the tenns and conditions set forth in

Trading Agreement and Order No. 8154 do now, by mutual agreement, modify this order as follows:

I) Delete paragraph A.3. and substitute the following therefor:

Official U.S. Environmental Protection Agency ("EPA") Reference Method 7E stack testing

performed on 3/4/98, 4/22197 and 4/18/97 for boilers Nos. 3,4, and 5 respectively, resulted

in NOx emission rates as follows:

Table 1

CE - NOx EMISSION RATES AND RAer LIMITS ObslMMlltu\ (Revised 4115100\

REG. Or HEATlNPUT STACK TEST RACT

UNiT PERMIT No. FUEL (MMBtu) RATE RATE

Boiler Rl12·09 No.6oil 14.3 0.338 0.25

No.3 No.2 oil 14.3 0.18 0.20

Nat. Gas 13.8 0.11 0.20

Boiler R2 12-] 0 No.6 oil 30.8 0.403 0.25

No.4 No.2 oil 30.8 0.17 0.20

Nat. Gas 30.0 0.10 0.20

Boiler P212·08 No.6 oil 30.8 0.317 0.25

No.5 No.2 oil 30.8 0.098 0.20

Nat. Gas 30.0 0.101 0.20

tJ 1/1/

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.Combustion Engineering, Inc. Trading Agreement and Order

No. 8154 Mod. No.3

a.

b.

2) Delcte Table 2 of paragraph C.2 and substitute the following therefor:

Table 2

CE - FLERs and NOx Emission Rates (Rc\'ised 8/31100)

FLER NOx EMISSION RATE

UNIT FUEL (]b/MMBtu) LIMITS (]blMMBtu)

Boiler No.3 No.6 oil 0.39 0.25

BoilcrNo.4 No.6oil 0,47 0.25

Boiler No.5 No.6oil 0.37 0.25

3) Delete paragraph C.6 and substitute the following therefor:

IfCE exceeds any of the FLERs specified in Table 2 afthis Trading Agreement

and Order, within sixty (60) days ofCE having knowledge of dle FLER

exceedance, CE shall purchase and retire ERCs to Offset excess emissions from

the FLER cxceedance. Such ERCs shall be equal to the exceedance in pounds

per hour per boiler multiplied by the total operating hours of each boiler

exceeding the FLER and summed together to determine the total insufficiency

plus a 100% premium.

lfthe period of non-compliance with the FLER is not known, the time period since

the last previous stack test shall be used to calculate the period of non-compliance

unless evidince demonstrating, to the Commissioner's satisfaction, that a different

time period should be used is submitted by CE to the Commissioner, in writing,

within thirty 30 days ofCE having knowledge of the FLER exceedance, and the

Commissioner in his sole discretion accepls such time period.

All other tenns and conditions ofTrading Agreement and Order No. 8154 issued by the

Commissioner acting under Sections 22a·6, 22a-171, 22a-174, 22a·176 and 22a-177 of lhe

Connecticut General Statutes shall remain in effect.

Initials: l·ft. 2 Date: 3/t r.:/o1.--
Combustion Engineering, Inc. Trading AQreement and Order

No. 8154 Mod. No.3

Combustion Engineering,lnc. hereby consents to the entry of this modification to the Trading Agreement

and Order without further notice.

Type Name: ·R. Keith Knauerhase

Type Title: Manager, Environmental Engineer lng

Date: March 28, 2002

Entered as amodification of an Order of the Commj:fion.er ofEnvironmental Protection

numbered 8154 this Z~ day of ...Y,Pn ( . 2

/

TOWN OF WINDSOR

LANTI RECORDS

MAILED CERTIFIED MAIL,

RETURN RECEIPT REQUESTED

Certified Document No. 7001 0360 0003 0796 2466

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3
STATE OF CONNECTICUT

DEPARTMENT OF ENVIRONMENTAL PROTECTION

Mr. Keith Knaverhausr. Manager of Environmental Operations

Combustion Engineering, Inc..

P.O. Box 500

2000 Day Hill Road

Windsor, CT 06095

Re: Trading Agreement and Order No. 8154, Modification No.3

Dear Mr.Knaverbausr:

Enclosed you will :md Trading Agreement and Order No.8 J54, Modification No.3 for review and

signature. This letter follows the request by Combustion Engineering, Inc. to decrease the full

load emission rates (FLERs) for boilers 3, 4, and 5 when burning No.6 fuel oil.

Please sign Trading Agreement and Order No. 8154, Modification No.3 within fourteen (14)

calendar days of your receipt of the Consent Order. Once the signed Trading Agreement and

Order Modification is received by the Department. it v,.iH be presented to the Commissioner for

signature. Ifsigned by the CommIssioner, Trading Agreement and Order No. 8154, Modification

No.3 will beCOine a Final Order 9fthe Commissioner and a certified copy ofthe Trading

Agreement and Order Modification will be returned to you via registered mail.

If you have any questions regarding this letter. please do not hesitate to contact Roland L.

Severance Jr., PE at (860) 424-3702.

Sincerely.

\II,A~ .

Enc(l)

Certified Document No.

,n.

C!l.~:&ttj-;:- Cannine DiBattista, Chief

Bureau of Air Management

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