December 20, 2013

The Honorable Regina A. McCarthy

Administrator

U.S. Environmental Protection Agency

William Jefferson Clinton Federal Building

1200 Pennsylvania Ave., NW

Washington, DC 20460-0001

Dear Administrator McCarthy:

On behalf of the Board of Directors and member companies of the Edison Electric Institute 

(EEI), as well as our partners at the Nuclear Energy Institute (NEI), Clean Energy Group’s 

316(b) Initiative (CEG), and Utility Water Act Group (UWAG), we want to extend our sincere 

thanks to Ken Kopocis and his team for meeting with our staff on December 18, 2013 to discuss 

remaining electric power sector concerns with the Clean Water Act (CWA) § 316(b) cooling

water intake structures rulemaking for existing facilities which is expected to be completed by 

January 14, 2014. Last week’s meeting was attended by Howard Shelanski, Dan Utech, and 

Gary Guzy and their respective teams, allowing for frank and open dialogue on the remaining 

issues.

Earlier in the year, you asked for feedback on certain issues of importance to the electric utility 

industry. Our September 17th response (attached) outlined our concerns about the proposed 

rule. Since that time, we understand that language in the rule has continued to be refined and 

that several of the issues we raised at that time have been the subject of revision. It is our 

understanding that several of these issues remain to be resolved and a new issue regarding 

permit application requirements has arisen. We are writing to explain those concerns and offer 

our recommendations on how best to resolve them in the final rule.

Endangered Species Act (ESA) Consultation and ESA-Related Regulatory Requirements

In a prior communication with you (see Utility Water Act Group letter dated October 25, 2013), 

we have stated that the proposed § 316(b) rule will have only beneficial effects on listed species

and the Services should conclude consultation with either a "not likely to adversely affect" 

concurrence, or a biological opinion finding that no jeopardy or adverse modification will occur 

as a result of the rule. Nevertheless, it is our understanding that in response to the ESA 

consultation, the rule could require permittees to provide vastly expanded information to 

permitting authorities on the potential for direct and indirect impacts to threatened and 

endangered species. We have further concerns that any new ESA framework would raise 

considerable practical and legal problems and impose potential liabilities on the permittees.

Trying to address species that may be in the area, but have no risk of being impinged or 

indirectly affected, and are potential prey of a listed species is much broader than the current 

ESA applications in the NPDES permitting process. To address these concerns, we request that: 
The Honorable Regina A. McCarthy

December 20, 2013

Page 2

 The Services reach a “not likely to adversely affect” concurrence, and 

 Any focus in the rule, both in terms of monitoring and study requirements, must be on 

organisms inhabiting or likely to inhabit the zone of influence of the intake and thus likely to be 

directly affected by the intake.

ESA issues have long been evaluated and addressed at each our facilities as required by the Endangered 

Species Act. It is essential that EPA reconsider and not include this new scope of monitoring and study 

requirements in the final rule.

Definition of Closed-Cycle Cooling and Waters of the United States (WOUS)

We remain very concerned that EPA has not resolved this issue according to established legal and 

regulatory precedent. Whether an existing facility is open-cycle or closed-cycle is a function of design 

choices made at the time of construction, not the jurisdictional classification assigned to any man-made 

ponds or impoundments included in its design. In addition to maintaining the current regulatory 

exemption for waste treatment systems, we recommend that EPA specify that cooling ponds or 

impoundments lawfully created principally to serve as part of a closed-cycle cooling system can continue 

to serve that purpose and will satisfy § 316(b) for both impingement and entrainment. To do otherwise 

would result in stranding these assets because these impoundments would no longer be usable for the 

purpose for which they were designed. Requiring that their status as a compliance technology hinge on 

their jurisdictional status as WOUS is wholly inconsistent with the statements EPA explicitly made in 

justifying its 1979 NPDES rule defining WOUS, which explicitly acknowledged that an impoundment 

could function as a compliance technology even if classified as a WOUS. 44 Fed. Reg. 32,585, col. 1. 

Use of Cost-Benefit Analysis and Willingness-to-Pay (WTP) Survey Issues

EPA’s proposal appropriately requires permitting authorities to consider a variety of factors, including 

costs and benefits, when making a best technology available (BTA) determination. We understand that 

EPA’s most recent thinking restores costs and benefits in BTA determinations to the list of mandatory 

actions to be considered by the Director. This is a positive step. However, there remain certain concerns 

regarding the continued reference to and endorsement of the use of WTP surveys on an individual permit 

basis despite the significant, demonstrable problems with the use of such surveys. 

To resolve these remaining concerns we ask that EPA take the following actions:

 Moderate the language which encourages the quantification of non-use benefits of reducing 

entrainment. It must be clear that states are not required to conduct a WTP survey to consider a 

permit application. This can be accomplished by (1) adding language acknowledging that in many 

cases, non-use benefits may not occur, (2) acknowledging the substantial issues involved in 

developing WTP surveys capable of producing reliable information, and thus the inherent 

uncertainty in monetizing non-use benefits through the WTP methodology, and (3) in the 

discussion of social benefit evaluation, endorsing the use of qualitative descriptions and adding 

language similar to that included in the preamble to the Phase II rule, which specifically provided 

that monetization of non-use benefits was not warranted unless the entrainment characterization 

study indicated substantial harm to listed threatened and endangered species, to the sustainability 

of populations of important species of fish, shellfish, and wildlife, or to maintenance of 

community structure and function in a facility’s waterbody or watershed. 69 Fed. Reg. 41,648, 

col. 1,
The Honorable Regina A. McCarthy

December 20, 2013

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 Ensure that the preamble and the rule clearly state that all non-water quality impacts are to be 

equally considered and weighed in determining whether further entrainment controls are justified, 

and 

 Modify the “backstop” provisions that require the Director to require closed-cycle cooling if any 

portion of the permit application is viewed to be “inadequate.” Currently, these provisions could 

be interpreted as requiring closed-cycle cooling if a facility does not conduct and submit a WTP 

survey as part of a cost-benefit study.

Definition of New and Existing Units at Existing Facilities

As stated in our September 17, 2013 letter, the electric power sector strongly believes that EPA should 

distinguish between “new” and “existing” units at existing facilities consistent with the 2011 proposed 

rule. We understand that the most recent iteration of the draft rule proposes to pinpoint the moment a 

modification renders an existing unit a new unit when three things occur: (1) the unit is repowered, 

replaced or rebuilt; (2) both the turbine and condenser are replaced; and (3) the location of the cooling 

water intake structure or design intake flow is changed. When these conditions are met, a mandatory 

closed-cycle cooling requirement would be established. Closed-cycle cooling is not BTA for modified 

units for the same reasons –land constraints, reliability impacts, non-water quality environmental impacts, 

etc.—closed-cycle cooling is not BTA for new units. Further, this process establishes a “New Source 

Review” type program that will discourage future efficiency improvements such as nuclear uprates. There 

is no evidence that the modifications will result in adverse environmental impact. Of course, states have 

the opportunity upon every permit renewal to determine if additional protection is warranted as a result of 

a plant modification. In making this determination, states must consider the same factors that they apply 

to site-specific decisions for existing facilities. We recommend that the provision be modified to mirror 

the language of the 2011 proposal which stated that new units at existing facilities should expressly 

exclude “repowered, rebuilt or replaced” units. 

De Minimis Concerns

We appreciate that the Agency has taken a number of positive steps to recognize the importance of 

including language exempting facilities that have a de minimis environmental impact related to 

impingement. However, we understand that the language includes a broad, generalized application of the 

ESA in a fashion that would render the language meaningless for facilities because it prohibits the ability 

of facilities to qualify for the de minimis provision if a listed species may be present in the area rather than 

if the facility is impinging or entraining listed species. As a result, the ESA provisions will tie the hands 

of permit writers and result in unjustifiable new costs to facilities while producing no environmental 

benefits. The de minimis provision should remain focused on actual impingement, as opposed to indirect 

or potential impingement, while fully recognizing design and engineering protections. Accordingly, we 

ask that the de minimis provisions be modified to allow the Director to determine that no additional 

impingement controls may be required at facilities with a low documented rate of impingement provided 

the facility complies with applicable requirements of the Endangered Species Act. 

Low Capacity Utilization Units

We understand the revised rule allows permittees to request less stringent impingement requirements for 

units with a low annual average capacity utilization rate. This is another positive development. But this 

provision must apply to entrainment as well as impingement. Units that have low capacity utilization 

rates are required for a variety of reasons, including but not limited to grid reliability, voltage 

maintenance, and load balancing. These facilities are infrequently called upon to produce power for the 
The Honorable Regina A. McCarthy

December 20, 2013

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grid. For those reasons, additional operational costs (such as the installation of impingement and 

entrainment reduction technologies) could make these units uneconomic and would force closure, thus 

defeating the reliability purpose they serve. Entrainment control technologies are often the more 

expensive and capital intensive of CWIS technologies. We would request that the provision be modified 

to allow permittees to request less stringent impingement and entrainment requirements for low capacity 

utilization units.

Permit Application Requirements and Deadlines

Permit application deadlines need to be reasonable in length and should not require the selection and 

installation of impingement control technologies until entrainment requirements have been established. 

This is a necessary feature of the final rule for engineering and cost reasons. To conduct impingement 

and entrainment assessments, the proper sequencing and adequate time are both needed. Based on our 

understanding of the current version of rule, neither is currently being provided.

To ensure that the permit application process is logical and efficient, we recommend that EPA should 

modify the final rule language to:

 Provide a minimum of five years for all facilities to complete the permit application requirements; 

 Add a provision requiring facilities to identify proposed impingement mortality control options 

compatible with entrainment control options for facilities that do not have in place the 

impingement control technology on which they plan to rely;

 Authorize permit writers to approve impingement controls based on a predictive demonstration of 

their performance, with any required two-year optimization study occurring after the technology 

has been installed; and

 Authorize permit writers to adjust permit application deadlines for cause, regardless of the 

expiration date of the facility’s current NPDES permit.

We thank you for your continued focus on this important rule that will affect almost half of the existing 

U.S. generation capacity. As we reach the final stages of this process, we are committed to working with 

the Agency to ensure an equitable and economical final rule that achieves important environmental 

benefits and ecological benefits throughout the U.S. 

Sincerely,

Michael W. Yackira

President & CEO

NV Energy

EEI Chair

Gerard M. Anderson

Chairman, President & CEO

DTE Energy Company

EEI Policy Committee on Environment Co-Chair
The Honorable Regina A. McCarthy

December 20, 2013

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Christopher M. Crane

President & CEO

Exelon Corp.

EEI 316(b) Issue Leader

Leo P. Denault

Chairman & CEO

Entergy Corp.

Anthony F. Earley, Jr.

Chairman, President & CEO

PG&E Corp.

Thomas F. Farrell

Chairman, President & CEO

Dominion

Lynn J. Good

Vice Chairman, President & CEO

Duke Energy

Ralph Izzo

Chairman, President & CEO

Public Service Enterprise Group, Inc.

EEI Policy Committee on Environment Co-Chair

James L. Robo

Chairman, President & CEO

NextEra Energy, Inc.

cc: The Hon. Robert Perciasepe, EPA

The Hon. Howard A. Shelanski, OMB

Gary Guzy, CEQ

Ken Kopocis, EPA

Dan Utech, DPC