Terry,

Please see below for some questions from ADEQ.
1) 2012 Nuclear Capacity data used to perform step 4a of the Under Construction and At Risk Nuclear Generation were obtained from the http://www2.epa.gov/sites/production/files/2014

- 06/20140602tsd

- egrid

- methodology_0.xlsx spreadsheet. These capacity values were verified with Nuclear Cap acity values reported in EIA 860 Generator Spreadsheet. The calculation methodology described in the Goal Computation Technical Support Document pages 14 and 15 was used to create the following formulas: & = ( 2012 × 5

. 8% + ) & ( h ) = & × 8784 × 90%

Application of the above formulas yielded a value of 845,978 MWh, not 842,037 MWh. Are there any other factors EPA is considering that we did not identify in the TSDs that could account for this discrepancy?
2) Based on the GHG Abatement Technical Support Document, the proposed approach to calculating the Renewable Energy target for Arkansas is to apply an 8 % annual growth rate to our 2012 RE generation beginning in 2017 because Arkansas is included in the South Central region (GHG Abatement TSD pages 4

- 15 and 4

- 18). I have verified that the 2012 RE Generation Value and Total Generation value listed in the table on page 4

– 6 of the GHG Abatement TSD matches the EIA 1990

- 2012 Net Generation by State by Type of Producer by Energy Source (EIA

- 906, EIA

- 92 0, and EIA

- 923) spreadsheet. I then applied the following calculations to replicate EPA’s Existing and Incremental Annual RE values for Arkansas: RE Generation 2017 (MWh) = RE Generation(2012) ( h ) = + ( × 0

. 08 ) ( h ) = ( ) + ( ( ) × 0

. 08 ) **Plant Name ORIS**  **code Generator** 

**ID Fuel** 

**ty pe**  **Nameplate**

**Capacity (MW)**  Arkansas Nuclear One 8055 1 NUC 902.5 Arkansas Nuclear One 8055 2 NUC 942.5

**2012 Total Capacity** 1,845.00 **Needs 5.13v3 Under Construction** 0.00 **At Risk (AR) per 5.8% in proposal** 107.01 **UC+AR Nuclear Capacity (MW)** 107.01 **UC +AR Nuclear Generation (MWh)** 845,978.26Where “i” is any year between 2018 and 2029

Should RE Generation reach RE percent ge neration target (20% from 2012 generation based on location in South Central region) during a given year, that generation target is kept at the same in subsequent years. When performing these calculations, I noticed a discrepancy between the numbers I came up with and the numbers EPA gives in the Goal Computation spreadsheet TSD. See the table below

Do my formulas seem logical based on EPA’s language in the GHG Abatement TSD pages 4

- 1 through 4

- 36? Are there any assumptions I am missing that might account for the discrepancy? I realize that the NEEDSv5.13 database has 20 MW capacity of hydro coming online in 2015; however, EPA states that it did not include hydro in the proposed approach calculations so I think that this would not factor in.

More Questions: EPA calculates an 827 lbs CO2 per kWh for NGCC in Arkansas, based upon a year in which average NGCC ran 32% of the time: There is a single large cogen that ran at 72% of the time at a calculated efficiency of 602 lbs CO2/kWh. This is the only NGCC unit with emissions below the “average” 827 lbs/mwh. Because the other NGCCs were at suc h a low level, this one cogen skews the average emissions rate significantly down during 2012. The cogen unit will contribute nothing to re
- dispatch because it is already above 70%. All of the remaining NGCC fleet has emissions above the “average” 827 lbs CO2/Mwh. These above

average - emissions units are the ones that would ramp up with re

- dispatch. EPA ADEQ 2012 1,660,370 1,660,370 2017 1,793,200 2018 1,936,656 2019 2,091,588 2020 Existing and Incremental RE 2,288,229 2,258,915 2021 Existing and Incremental RE 2,479,266 2,439,628 2022 Existing and Incremental RE 2,686,252 2,634,799 2023 Existing and Incremental RE 2,910,519 2,845,583 2024 Existing and Incremental RE 3,153,509 3,073,229 2025 Existing and Incremental RE 3,416,786 3,319,087 2026 Existing and Incremental RE 3,702,042 3,584,614 2027 Existing and Incremental RE 4,011,114 3,871,384 2028 Existing and Incremental RE 4,345,990 4,181,094 2029 Existing and Incremental RE 4,708,823 4,515,582Furthermore, it is the least efficient units (with emissions of over 1000 lbs CO2/Mwh) that ran 11% of

the time or less in 2012 (despite super

- low natura l gas prices, and precisely because they were inefficient). The efficient units ran close to 50% of the time (but still with emissions above our assigned average). So the theoretical expansion in Arkansas would be disproportionately among the units w ith the highest emissions rate, well above the EPA

- calculated rate. Because 68% of the Arkansas goal is based upon NGCC re

- dispatch, assumptions about the emissions rate for re

- dispatched NGCC are very significant for the magnitude of the Arkansas goal. Why does EPA think that our re

- dispatched NGCC emissions rate will reasonably be lower than every unit that could be re

- dispatched to 70%? The question of whether a state could split its plan between rate

- based in one region of the state and mass - base d in another came up on one of the numerous conference calls this week. It sounded to me like EPA would entertain this approach. So, if it would not be too much further work for Terry, it might be useful to see what mass

- based looks like for the SWEPCO territory or even SPP region.