ART GRAHAM

CHAIRMAN

STATE OF FLORIDA

Capital Circle Office Center 

2540 Shumard Oak Boulevard 

Tallahassee, FL 32399-0850 

(850) 413-6040 

Public Service Commission 

July 15, 2011 

The Honorable Marco Rubio 

United States Senate 

B40A Dirksen Senate Office Building 

Washington, DC 20510 

Re: Environmental Protection Agency Rulemakings on Clean Air Act Toxics and on Cooling 

Water Intake Facilities 

Dear Senator Rubio: 

 The Florida Public Service Commission (FPSC) is charged with ensuring that Florida’s 

electric utilities provide safe, reliable energy for Florida’s consumers in a cost-effective manner. We 

therefore believe it is critical to write regarding the Environmental Protection Agency’s (EPA) 

proposed rules. While we recognize the necessity to address the public health and environmental 

measures, we are concerned that the Electric Utility Air Toxics rule and the Cooling Water Intake 

Structures rule have the potential for significant rate and reliability impacts on Florida’s energy 

consumers. To lessen this impact, we urged the EPA in the enclosed comments to allow the maximum 

compliance flexibility provided under the Clean Air Act and Clean Water Act so that utilities may 

choose the most efficient, least-cost compliance options to meet the goals. 

 Pursuant to Florida law, Florida’s investor-owned electric utilities may petition the FPSC for 

recovery from ratepayers for prudently incurred costs required to comply with new environmental 

requirements. Recovery of compliance costs for the new rulemakings through a cost recovery clause 

will have a near immediate rate impact on Florida’s consumers. Preliminary estimates by Florida’s 

investor-owned utilities anticipate a range of potential total costs of between $4.4 billion to $6.7 

billion to comply with EPA’s proposed Utility Air Toxics and Cooling Water Intake Structures rule 

amendments. 

Proposed Utility Air Toxics Rule

 Approximately 27 percent of Florida’s electricity needs are currently met with coal- and oilfired generation, the generation resources subject to the proposed Air Toxics rule. It appears that 

significant controls would be necessary at many of these units, and some units would be at risk of 

forced retirement. The FPSC is particularly concerned that there is a three year compliance time line, 

with a potential one year extension, of the proposed rule. Some of the control technologies that would 

allow utilities to comply would take two to four years for design and installation. It is our 

understanding that it is the Federal law that requires this time line. With many utilities vying for the 

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PSC Website: http://www.floridapsc.com Chairman.Graham@psc.state.fl.us 
same equipment and specialized labor, it is to be expected that there will be price pressure, and 

potentially shortages, on compliance technologies and skilled labor. This would cause a significant 

cost impact on ratepayers and a potential impact on reliability. We ask Congress to encourage the 

EPA to use the maximum flexibility set forth in the Clean Air Act in providing adequate time to attain 

compliance to minimize the impacts to ratepayers. 

Proposed Cooling Water Intake Structures Rule

 One of the FPSC’s primary concerns about this rule is that EPA does not provide for a costbenefit analysis for utilities subject to the impingement standard. The FPSC urges flexibility in 

compliance options. In some instances, Florida utilities have suggested that the lowest cost option to 

meet the impingement standards may be a cooling tower because the standard cannot be met with 

screens and intake velocity cannot be reduced sufficiently without a closed loop cooling system. 

Some generating facilities in Florida appear not to have sufficient land to install such systems and this 

could have reliability implications. For this reason, we urge there to be a cost-benefit analysis on the 

impingement standards. 

 The National Association of Regulatory Utility Commissioners adopted the enclosed 

resolution. The FPSC supports the general principles in the resolution, which include: 

 Avoid compromising system reliability; 

 Minimize cost impacts to consumers; 

 Provide an appropriate degree of flexibility and timeframes for compliance; 

 Recognize the needs of each state and region to deploy a portfolio of cost-effective supply and 

demand-side resources based on unique circumstances; 

 Employ rigorous cost-benefit analysis consistent with federal law, in order to ensure sound 

public policy outcomes. 

 In conclusion, the FPSC has concerns with the proposed EPA rules as discussed above. We 

recognize that in some instances the EPA must adhere to deadlines established in the law, such as 

those for the Air Toxics rule. However, we ask that Congress encourage EPA to use the maximum 

flexibility and discretion already provided in the Clean Air Act to allow adequate and reasonable time 

for regulated utilities to comply with these new rules. We also urge Congress to support a cost-benefit 

analysis for the impingement standards in the Cooling Water Intake Structures rule, where EPA has 

the flexibility to do so. 

 Thank you for considering our concerns. 

 Sincerely, 

 

 Art Graham 

 Chairman 

AG/CM 

Enclosure: FPSC Comments to the Environmental Protection Agency with NARUC Resolution