Source: http://www.regulations.gov/?_escaped_fragment_=documentDetail;D=EPA-R09-OAR-2013-0009-0457
Timestamp: 2015-10-10 01:29:02
Document Index: 55602257

Matched Legal Cases: ['art 51', 'art 51', 'art 51', 'art 51', 'art 71', '§ 49', '§ 49', '§ 49', '§ 49', '§ 49', '§ 49', 'art 71', '§ 49', 'art 71', '§ 49', 'art 71', '§ 49', '§ 49', '§ 49', '§ 49', '§ 49', '§ 49']

Skip Navigation HomeHelpResourcesContact Us Advanced Search Start of Main Content Air Quality State Implementation Plans; Approvals and Promulgations: Navajo Nation; Regional Haze Requirements for Navajo Generating Station This Rule document was issued by the Environmental Protection Agency (EPA)For related information, Open Docket Folder Show agency attachment(s) ENVIRONMENTAL PROTECTION AGENCY
[EPA-R09-OAR-2013-0009; FRL-9914-62-Region 9]
SummaryThe Environmental Protection Agency (EPA) is promulgating a source-specific Federal Implementation Plan (FIP) requiring the Navajo Generating Station (NGS), a coal-fired power plant located on the Navajo Nation near Page, Arizona, to achieve reductions in oxides of nitrogen (NO X) required under the Best Available Retrofit Technology (BART) provisions of the Clean Air Act (CAA) and the Regional Haze Rule (RHR). On February 5, 2013, EPA issued a proposed BART determination for NGS and an alternative to BART. In a supplemental proposal on October 22, 2013, EPA proposed to approve a new alternative plan, based on an agreement developed by a group of stakeholders known as the Technical Work Group (TWG). EPA is finalizing the alternative to BART described in our supplemental proposal. This rule is consistent with the TWG Agreement, including a lifetime cap in total emissions of NO X from NGS over 2009-2044 (2009-2044 NO X Cap). Our final action will achieve greater emissions reductions than BART and is expected to significantly reduce the impact of NGS on visibility at 11 mandatory Class I Federal areas. The operator of NGS must implement one of several alternative operating scenarios to achieve the necessary emission reductions to comply with the 2009-2044 NO X Cap.
Dates Effective date: This rule is effective on October 7, 2014.
For Further Information ContactAnita Lee, EPA Region 9, (415) 972-3958, lee.anita@epa.gov. Supplementary InformationEPA has established a docket for this action under Docket ID No. EPA-R09-OAR-2013-0009. The index to the docket for this action is available electronically at http://www.regulations.gov and in hard copy at EPA Region 9, 75 Hawthorne Street, San Francisco, California. While documents in the docket are listed in the index, some information may be publicly available only at the hard copy location (e.g. copyrighted material, voluminous or oversized documents, etc.), and some may not be publicly available in either location (e.g. Confidential Business Information (CBI)). To inspect the hard copy materials, please schedule an appointment during normal business hours with the contact listed in theFOR FURTHER INFORMATION CONTACTsection. A reasonable fee may be charged for copies.
Throughout this document, “we”, “us”, and “our” refer to EPA.Table of ContentsI. Executive Summary
II. Background for the Final Rule
A. History of NGS
B. Summary of Statutory and Regulatory Framework for Addressing Visibility and Sources Located in Indian Country
C. Summary of Proposed Rule and Supplemental Proposal
D. Summary of Legal Rationale for Compliance Flexibility
III. Summary of Final FIP Provisions
IV. Summary of Major Issues Raised by Commenters
L. Petitions for Judicial ReviewI. Executive SummaryEPA is taking final action pursuant to the CAA and the RHR to require Units 1, 2, and 3 at NGS to reduce emissions of NO X in order to reduce the impact NGS has on visibility at 11 mandatory Class I Federal areas. We are finalizing an alternative to BART based on agreed-upon recommendations developed by a group of diverse stakeholders known as the Technical Work Group (TWG). Our final action limits emissions of NO X from NGS by establishing a long-term facility-wide cap on total NO X emissions from 2009 to 2044 and requires the implementation of one of several alternative operating scenarios to ensure that the 2009-2044 cap is met. Generally, the alternative operating scenarios require the closure of one unit at NGS (or the curtailment of electricity generation by a similar amount) in 2019, and compliance with a NO X emission limit that is achievable with the installation of selective catalytic reduction (SCR) on two units in 2030.
As part of our final action, EPA is also setting a source-specific BART Benchmark against which to compare the TWG Alternative to ensure that it will achieve greater reasonable progress than BART. The BART Benchmark is consistent with the BART determination we proposed on February 5, 2013, requiring all three units at NGS to meet an emission limit achievable with SCR within five years of a final rule. EPA is not finalizing our proposed BART determination for NGS in the regulatory requirements of this Final Rule.
EPA's action to finalize an alternative to BART consistent with the TWG Agreement will achieve greater NO X emission reductions at lower cost than BART in exchange for flexibility in the timeframe for achieving NO X reductions. When fully implemented, this Final Rule requires over an 80 percent reduction in NO X emissions from NGS and is expected to significantly reduce the impact of NGS on visibility at 11 mandatory Class I Federal areas.II. Background for the Final RuleA. History of NGSNGS is a coal-fired power plant located on the Navajo Nation Indian Reservation near Page, Arizona. The facility consists of three 750 megawatt (MW) coal-fired electric utility steam generating units with a total capacity of 2250 MW constructed from 1974 to 1976. The three units at NGS are co-owned by six entities: The United States Bureau of Reclamation (Reclamation) (24.3 percent); Salt River Project (21.7 percent), which also serves as the facility operator; Los Angeles Department of Water and Power (21.2 percent); Arizona Public Service (14 percent); NV Energy (11.3 percent); and Tucson Electric Power (7.5 percent).
Federal participation in NGS was authorized in the Colorado River Basin Project Act of 1968 as a preferred alternative to building hydroelectric dams in the Grand Canyon for the purpose of providing power to the Central Arizona Project (CAP). (1)
TheCAP is a 336-mile water distribution system that delivers about 1.5 million acre-feet (AF) per year of Colorado River water from Lake Havasu in western Arizona to non-Indian agricultural (NIA) water users in central Arizona, Indian tribes located in Arizona, and municipal water users in Maricopa, Pinal, and Pima Counties in Arizona. The CAP water is used to meet the terms of a number of Indian water-rights settlements in central Arizona and to reduce groundwater usage in the region. A portion of Reclamation's share of electricity from NGS powers the pumps that move CAP water to its destinations along the distribution system.
Several tribes located in Arizona, including the Gila River Indian Community, the Ak-Chin Indian Community, the Tohono O'odham Nation, the San Carlos Apache Tribe, the White Mountain Apache Indian Tribe, the Fort McDowell Yavapai Nation, the Salt River Pima-Maricopa Indian Community, the Navajo Nation, the Yavapai-Apache Nation, the Hopi Tribe, the Pascua Yaqui Tribe, the Yavapai-Prescott Tribe, and the Tonto Apache Nation, have CAP water allocations or contracts. In exchange for allocations of CAP water at reduced cost and access to funds for the development of water infrastructure, the tribes with water settlement agreements have released their claims to other water in Arizona. Excess NGS power owned by Reclamation that is not used by CAP is sold and profits are deposited into the Lower Colorado River Basin Development Fund (Development Fund) to support the tribal water settlement agreements. The U.S. Department of the Interior (DOI or Interior), through Reclamation, plays an important role in the implementation of these settlement agreements and the management of the Development Fund.
The coal used by NGS is supplied by the Kayenta Mine, operated by Peabody Energy and located on reservation lands of both the Navajo Nation and the Hopi Tribe. Taxes and royalties from NGS and the Kayenta Mine are paid to the Navajo Nation and Hopi Tribe, contributing to the annual revenues for both governments. EPA understands that the process is underway to renew site leases for NGS and the Kayenta Mine, as well as associated rights of way agreements and contracts with the Navajo Nation and Hopi Tribe.
Given the extent of federal and tribal interests in NGS, on January 4, 2013, EPA, DOI, and the Department of Energy (DOE) signed a joint federal agency statement (Joint Statement) committing to collaborate on several short- and long-term goals, including analyzing and pursuing strategies for providing clean, affordable, and reliable power, affordable and sustainable water, and sustainable economic development to key stakeholders who currently depend on NGS. (2)
The Joint Statement also recognizes the trust responsibility of the Federal government to Indian tribes.B. Summary of Statutory and Regulatory Framework for Addressing Visibility and Sources Located in Indian CountryIn our Proposed Rules, we provided a detailed discussion of the statutory and regulatory framework for addressing visibility impairment in the mandatory Class I Federal Areas, addressing sources located in Indian country under the statute and the Tribal Authority Rule (TAR), and developing BART determinations pursuant to the CAA and the BART Guidelines set forth in Appendix Y to 40 CFR Part 51. (3)
Here, we provide a brief summary of the statutory and regulatory framework.
Title I, part C, subpart II of the CAA Amendments of 1977 establishes a visibility protection program that sets forth “as a national goal the prevention of any future, and the remedying of any existing, impairment of visibility in mandatory class I Federal areas which impairment results from man-made air pollution.”
EPA promulgated regional haze regulations implementing the program on April 22, 1999. (5)
Consistent with the statutory requirement in 42 U.S.C. 7491(b)(2)(a), EPA's 1999 regional haze regulations include a provision that States must require certain major stationary sources to procure, install, and operate BART. This provision covers sources in listed industrial categories with the potential to emit 250 or more tons per year of an air pollutant that were “in existence on August 7, 1977, but which ha[ve] not been in operation for more than fifteen years as of such date.” These sources are considered to be “BART-eligible.”
NGS meets these criteria and is a BART-eligible source. (7)
BART-eligible sources that are reasonably anticipated to cause or contribute to visibility impairment are “subject” to the BART requirements. (8)
Generally speaking, a BART-eligible source with a predicted visibility impact of 0.5 deciviews (dv) or more in a Class I area is considered to “contribute” to visibility impairment. (9)
NGS contributes to visibility impairment at 11 surrounding Class I areas in excess of this threshold, and is thus subject to BART.
In determining BART, States are required to take into account five factors identified in the CAA and EPA's regulations. (10)
Those factors are: (1) The costs of compliance, (2) the energy and non-air quality environmental impacts of compliance, (3) any pollution control equipment in use or in existence at the source, (4) the remaining useful life of the source, and (5) the degree of improvement in visibility which may reasonably be anticipated to result from the use of such technology. (11)
EPA's guidelines for evaluating BART provide more detail and are set forth in Appendix Y to 40 CFR Part 51.
In 1998, EPA promulgated the Tribal Authority Rule (TAR) relating to implementation of CAA programs in Indian country. (12)
In the TAR, EPA determined that it has the discretionary authority to promulgate “such federal implementation plan provisions as are necessary or appropriate to protect air quality” consistent with CAA sections 301(a) and 301(d)(4) when a tribe has not submitted or EPA has not approved a Tribal Implementation Plan (TIP). (13)
EPA has previously promulgated FIPs under the TAR to regulate air pollutants emitted from NGS. (14)
Under the CAA, compliance with emission limits determined to be BART must be achieved as expeditiously as practicable but not later than 5 years after the effective date of the final BART determination (See CAA 169A(b)(2)(A) and (g)(4)). As discussed in greater detail in our Proposed Rule, EPArecognizes that the circumstances related to NGS create unusual and significant challenges for a 5-year compliance schedule. (15)
Based on those challenges and our discretion under the TAR for implementing CAA requirements in Indian country, we considered other options that are consistent with the CAA and RHR, and that provide for a more flexible, extended compliance schedule.
EPA's BART regulations allow an alternative in lieu of BART, provided the alternative results in greater reasonable progress than would have been achieved through installation of BART. (16)
Generally, an alternative is considered to be approvable provided it results in greater emissions reductions and the geographic distribution in emissions from the alternative is not substantially different than the distribution of the emissions under BART. (17)
For a state that is subject to the submittal deadlines in the RHR, the regulations provide that alternatives to BART must ensure that all necessary emission reductions occur within the period of the first long-term strategy for regional haze (i.e., by 2018) for states that were required to submit regional haze SIPs in December 2007. (18)
Thus, if states had submitted timely regional haze SIPs in 2007 with BART compliance deadlines in 2012, the RHR provided more than 5 additional years for the implementation of alternatives to BART.C. Summary of Proposed Rule and Supplemental ProposalEPA published an advanced notice of proposed rulemaking (ANPR) concerning BART for NGS and the Four Corners Power Plant in August 2009. (19)
On February 5, 2013, EPA's proposed BART determination for NGS was published in theFederal Registerand provided a thorough discussion of the statutory and regulatory framework for addressing visibility through application of BART for sources located in Indian country, and of the factual background for our BART determination at NGS. (20)
The proposal analyzed the five BART factors and proposed to find that BART for NGS was installation of emissions controls to meet a NO X emission limit of 0.055 lb/MMBtu based on a rolling average of 30 boiler operating days (30-BOD average). (21)
However, in recognition of the important role that NGS and the Kayenta Mine play in providing employment and revenue to the Navajo Nation and Hopi Tribe, and the role of Reclamation's share of electricity generated by NGS in fulfilling water settlement agreements with numerous tribes located in Arizona, we proposed that the potential economic impacts to tribes argue for thoughtful consideration of how flexibility in the compliance timeframe could be provided consistent with the air quality goals of the CAA. (22)
Therefore, as discussed in our Proposed Rule, EPA proposed to exercise our authority and discretion under section 301(d)(4) of the CAA and 40 CFR 49.11(a) to propose an appropriate timeframe for alternative measures to BART under the RHR for NGS. We provided a thorough discussion of the legal rationale for setting the compliance schedule for alternative measures in our Proposed Rule. (23)
Our Proposed Rule included a framework for evaluating alternatives to BART. (24)
As part of the framework, EPA proposed a NO X emission credit for the previous early and voluntary installation of low-NO X burners with separated over-fire air (LNB/SOFA) over the 2009-2011 timeframe (LNB/SOFA credit). We proposed that the LNB/SOFA credit supported setting a compliance timeframe based on the flexibility under section 301(d)(4) of the CAA and 40 CFR 49.11(a). (25)
EPA proposed to find that an alternative is “better than BART” if the total emissions over 2009-2044 from the alternative measure, minus the LNB/SOFA credit, are less than the total emissions under our proposed BART determination for the same period (i.e., the BART Benchmark). Consistent with this framework, EPA proposed an alternative to BART, requiring compliance with an emission limit of 0.055 lb/MMBtu on one unit per year in 2021, 2022, and 2023 (Alternative 1). We calculated that total emissions under Alternative 1 over 2009-2044, minus the LNB/SOFA credit, would be less than emissions based on the BART Benchmark. Thus, we proposed to find that Alternative 1 was “better than BART”. EPA recognized that there may be interest in additional flexibility beyond the 2021-2023 timeframe. EPA evaluated two additional compliance schedules but did not propose to approve them as “better than BART” alternatives because total emissions over 2009-2044 under these compliance schedules exceeded the BART Benchmark. However, we noted that potential technologies or other options for achieving additional emission reductions could bridge the NO X emission reduction deficit for alternatives to BART with compliance schedules that do not, by themselves, meet the BART Benchmark. (26)
We invited stakeholders to submit additional BART alternatives, consistent with our proposed framework, for EPA's consideration.
On July 26, 2013, a stakeholder group, known as the Technical Work Group on NGS (TWG), submitted an agreement that had been established among the seven diverse entities in the TWG. We refer to the July 26, 2013, document as the “TWG Agreement.” The TWG is composed of representatives from Central Arizona Water Conservation District (CAWCD), the Environmental Defense Fund (EDF), the Gila River Indian Community (Gila River or the Community), the Navajo Nation (Navajo), Salt River Project (SRP) on behalf of itself and the other non-federal owners, DOI, and Western Resource Advocates (WRA). Although EPA attended the opening session of a “kick-off” meeting for the TWG on March 21, 2013, at which we described our Proposed Rule, EPA did not otherwise participate in the TWG and was not involved in any of the discussions leading to submittal of the TWG Agreement.
Appendix B to the TWG Agreement contained TWG's recommendation for an alternative to BART. In general, the alternative plan in the TWG Agreement included closure of one unit at NGS, or curtailment of net generating capacity by an equivalent amount, in 2019 and compliance with a NO X emission limit of 0.07 lb/MMBtu on two units at NGS beginning in 2030. The TWG Agreementalso included a provision requiring the operator of NGS to cease conventional coal-fired generation at NGS by the end of 2044.
EPA independently evaluated Appendix B to the TWG Agreement to determine whether it complied with the framework we put forth in our Proposed Rule, as well as the statutory and regulatory requirements in the CAA and the RHR. On October 22, 2013, EPA published a Supplemental Proposal describing the TWG Agreement and requesting comment. (27)
Our Supplemental Proposal contained a detailed evaluation of Appendix B to the TWG Agreement along with a discussion of our legal rationale for proposing to approve requirements consistent with the TWG Agreement as meeting the requirements for an alternative to BART. Throughout this document, we refer to the regulations we proposed in our Supplemental Proposal that are consistent with Appendix B of the TWG Agreement as the “TWG Alternative.” Thus, in this document, the term TWG Alternative refers to EPA's independent regulatory requirements for NGS consistent with the TWG Agreement, rather than to Appendix B of the TWG Agreement.
In our Supplemental Proposal, we proposed to revise the numerical value of the BART Benchmark from our Proposed Rule. We also proposed a 2009-2044 NO X Cap based on the revised numerical value of the BART Benchmark. In our Proposed Rule, we calculated the BART Benchmark to be 358,974 tons of NO X. As discussed in our Supplemental Proposal, we proposed three changes to the BART Benchmark: (1) Correction of a transcription error; (2) correction of the date that EPA anticipated would be 5 years following the effective date of the final rule (i.e., July 1, 2019 instead of January 1, 2018); and (3) application of the LNB/SOFA credit to the BART Benchmark, rather than alternatives to BART, to represent emissions under BART if LNB/SOFA had been installed concurrently with selective catalytic reduction (SCR) to reduce NO X emissions. (28)
Based on these changes, EPA proposed a 2009-2044 NO X Cap of 494,899 tons. Although EPA revised our accounting method for the LNB/SOFA credit in our Supplemental Proposal, EPA provided a demonstration that the method EPA used in our Proposed Rule to compare our proposed BART determination against BART alternatives was equivalent to the method in the Supplemental Proposal. (29)
The application of the LNB/SOFA credit to the BART Benchmark in the Supplemental Proposal represented what total emissions over 2009-2044 would have been under our proposed BART determination if the operator of NGS had elected to install LNB/SOFA concurrently with SCR, i.e., within 5 years of a final rule, rather than in 2009-2011. Calculation of the BART Benchmark and 2009-2044 NO X Cap in this manner is easier to apply and enforce in the context of a cap in NO X emissions because the LNB/SOFA credit is built into the BART Benchmark rather than subtracted each year from actual cumulative emissions. (30)
In addition to the enforceable 2009-2044 NO X Cap, our Supplemental Proposal defines the operating scenarios that would be required depending on the final outcome of NGS ownership after the expiration of the current lease term at the end of 2019. In the TWG Agreement, the owners of NGS committed to maintain emissions from NGS below the 2009-2044 NO X Cap regardless of post-2019 ownership of NGS and the applicable operating scenario. As a result, the operating scenarios in the TWG Alternative include specific actions for achieving emission reductions in 2019 and in 2030. The TWG Alternative also provides for an operating scenario that is less well-defined in terms of specific actions but establishes a second NO X emissions cap over the period of 2009-2029 (2009-2029 NO X Cap) that is equivalent to emission reductions that would be achieved by a more well-defined operating scenario. The 2009-2029 NO X Cap would apply in addition to the 2009-2044 NO X Cap. The Supplemental Proposal included requirements for annual emission reporting to EPA that would also be made publicly available as part of the compliance demonstration for the TWG Alternative.D. Summary of Legal Rationale for Compliance FlexibilityIn our February 5, 2013, proposal for NGS, EPA proposed an alternative to BART that we referred to asAlternative 1. EPA proposed to find that consideration of a compliance schedule beyond 2018 for Alternative 1 at NGS was appropriate for a number of reasons, including the importance of NGS to numerous Indian tribes located in Arizona and the federal government's reliance on NGS to meet the requirements of water settlements with several tribes. Providing this timeframe for compliance would not, in itself, avoid or mitigate increases in water rates for tribes located in Arizona; however, it would provide time for the collaborating federal agencies to explore options to avoid or minimize potential impacts to tribes, including seeking funding to cover expenses for the federal portion of pollution control at NGS.
In developing this framework, EPA proposed to exercise its authority and discretion under section 301(d)(4) of the CAA, 42 U.S.C. 7601(d)(4) and the TAR, 40 CFR 49.11(a), and proposed an appropriate timeframe for an alternative measure under the RHR for NGS. EPA considered this timeframe to be consistent with the general programmatic requirements. Under the RHR, States and regulated sources had almost 20 years from the issuance of the rule in 1999 to design and implement alternative measures to BART. For numerous reasons, including the myriad stakeholder interests and complex governmental interests unique to NGS, we are only now addressing the BART requirements for NGS.
Our proposal to require emission reductions beyond 2018 was supported by CAA section 301(d)(4) and the TAR codified at 40 CFR 49.11(a). The TAR reflects EPA's commitment to promulgate “such Federal implementation plan provisions as are necessary or appropriate to protect air quality” in Indian country where a tribe either does not submit a Tribal Implementation Plan (TIP) or does not receive approval of a submitted TIP (emphasis added).
The use of the term “provisions as are necessary or appropriate” indicates EPA's determination that it may only be necessary or appropriate to promulgate a FIP of limited scope. The United States Court of Appeals for the Tenth Circuit has previously endorsed theapplication of this approach in a challenge to the FIP for the Four Corners Power Plant, stating: “[40 CFR 49.11(a)] provides the EPA discretion to determine what rulemaking is necessary or appropriate to protect air quality and requires the EPA to promulgate such rulemaking.”
The court went on to observe: “Nothing in section 49.11(a) requires EPA . . . to submit a plan meeting the completeness criteria of [40 CFR part 51] Appendix V.”
While the decision in the Tenth Circuit focused on 40 CFR part 51, Appendix V, EPA believes the same considerations apply to the promulgation of a FIP intended to address the objectives set forth in 40 CFR 51.308(e)(2). In particular, EPA has discretion to determine if and when a FIP addressing the objectives set forth in 40 CFR 51.308(e)(2) should be promulgated, which necessarily includes discretion to determine the timing for complying with the requirements of any such FIP.III. Summary of Final FIP ProvisionsEPA is finalizing our finding that it is necessary or appropriate to promulgate a source-specific FIP requiring NGS to achieve NO X emission reductions required by the BART provisions of the CAA and RHR. EPA is determining that our proposed NO X emission limit of 0.055 lb/MMBtu, based on our analysis of the relevant factors, establishes the appropriate BART Benchmark for determining “better than BART.” Further, we are finalizing our assessment that the TWG Alternative, which establishes an enforceable 2009-2044 cap on NO X emissions from NGS over the life of the facility is “better than BART.” Finally, we are finalizing the TWG Alternative as the FIP requirements for NGS.
EPA is promulgating four possible operating scenarios under the TWG Alternative (see Table 1). The operator of NGS must implement one of the four enforceable operating scenarios in order to comply with the 2009-2044 NO X Cap. The applicable operating scenario will depend on the outcome of ownership changes related to LADWP, NV Energy, and Navajo Nation, as well as whether the operator of NGS can increase capacity (by no more than 189 MW) to accommodate ownership changes, without triggering New Source Review permitting requirements, as described in Table 1. Once the ownership outcomes are finalized, the operator of NGS must implement the applicable Alternative as shown in Table 1. For example, if LADWP and NV Energy both retire their ownership shares of NGS and the Navajo Nation does not elect to purchase an ownership share of NGS, TWG Alternative A1 applies and the operator of NGS must implement Alternative A1 and may not elect to implement Alternatives A2, A3, or B. By December 1, 2019, the operator of NGS must notify EPA of the applicable Alternative (i.e., TWG Alternative A1, A2, A3, or B).
In addition to the enforceable 2009-2044 NO X Cap, Alternatives A1, A2, and A3 each has enforceable emission reduction measures in 2019 and 2030 (see Table 1). Under Alternative B, in addition to the enforceable 2009-2044 NO X Cap, the operator of NGS must also ensure that cumulative NO X emissions over 2009-2029 comply with the 2009-2029 NO X Cap. The 2009-2029 NO X Cap is calculated based on emissions that would have been emitted over that period under Alternative A1. Under all Alternatives, if, based on required annual reports submitted by the operator of NGS to EPA, cumulative emissions of NO X from NGS exceed the 2009-2044 NO X Cap at any time prior to December 31, 2044, the operator of NGS must permanently cease operation of NGS. In addition, under Alternative B, if cumulative emissions of NO X exceed the 2009-2029 NO X Cap prior to 2029, the operator of NGS must temporarily cease operation of all units at NGS. (33)
Under all Alternatives, the operator must permanently cease operation of all units at NGS by December 22, 2044.
Under all TWG Alternatives, the operator of NGS must report to EPA annual emissions and heat input data and must make this information publicly available on its Web site. In addition, under TWG Alternative B, the operator must also submit to EPA annual Emission Reduction Plans projecting year-by-year emissions covering the 2020-2029 and 2030-2044 periods so that there is a plan for operation of NGS that ensures that cumulative emissions of NO X do not exceed the 2009-2029 NO X Cap and the 2009-2044 NO X Cap. Although year-by-year emissions projected in the annual Emission Reduction Plans are not enforceable (i.e., emissions in a given year are not required to match projections for that year in an Emission Reduction Plan), the requirement to submit Emission Reduction Plans is enforceable, and provides the operator with a framework for planning for future emissions reductions. The requirement also provides EPA and the public the opportunity to monitor and evaluate progress of emission reductions under TWG Alternative B.
Table 1—Summary of the Major Regulatory Provisions of the TWG Alternative
Applicability (Step 1) • If LADWP and NV Energy both exit NGS without selling their ownership interests (i.e., retire shares), or both exit by selling to an existing NGS participant; or one retires shares and the other sells to an existing NGS participant; and• If LADWP or NV Energy sells to a 3rd party, or does not exit NGS; (Step 2) • If Navajo Nation does not purchase ownership share by 12/31/19;• If Navajo Nation purchases up to 170 MW by 12/31/19; and• If Navajo Nation purchases up to 170 MW by 12/31/19; and• n/a.
(Step 3) • n/a• If Participants increase capacity without triggering permit requirements;• If Participants cannot increase capacity without triggering permitting);• n/a.
Applicable AlternativeThen TWG Alternative A1 appliesThen TWG Alternative A2 appliesThen TWG Alternative A3 appliesThen TWG Alternative B applies.
Applicable Requirements• Comply with 2009-2044 NO X Cap of 494,899 tons. • Permanently cease operation of all units if cumulative emissions before 2044 exceed 2009-2044 NO X Cap. • Permanently cease conventional coal-fired electricity generation by December 22, 2044. Additional Emission Cap• n/a• Comply with 2009-2029 NO X Cap of 416,865 tons. Specific Requirements *• By 12/31/19 permanently close 1 unit• By 12/31/19 permanently close 1 unit• By 12/31/19 reduce net generating capacity by no less than 561 MW• Temporarily cease operation if cumulative emissions before 2029 exceed 2009-2029 NO X Cap.
• By 12/31/30 meet NO X limit of 0.07 lb/MMBtu on 2 units• By 12/31/19 operator may increase capacity by no more than 189 MW• By 12/31/30 meet NO X limit of 0.07 lb/MMBtu on 2 units • By 12/31/30 meet 0.07 lb/MMBtu on 2 units Reporting• By December 1, 2019, notify EPA of applicable Alternative (A1, A2, A3, or B). • Submit annual report summarizing heat input and annual and cumulative emissions of NO X. • Make annual report publicly available on Web Site. • Submit application to revise Part 71 Operating Permit by December 31, 2020. Additional Reporting• n/a• By 12/31/19 and annually thereafter submit Emission Reduction Plans to project year-by-year emissions to assure compliance with NO X Caps. In our final rule, EPA has included several revisions to the proposed regulatory text (40 CFR 49.5513(j)) put forth in the Supplemental Proposal. The substantive revisions include:
1. Revision to § 49.5513(j)(3) to clarify that EPA is finalizing a “better than BART” Alternative;
2. Additions to § 49.5513(j)(3) to specify that the operator must temporarily cease operation of NGS if cumulative emissions of NO X exceed the 2009-2029 NO X Cap of 416,865 tons at any time prior to December 31, 2029 (under Alternative B), and must permanently cease operation of NGS if cumulative emissions of NO X exceed the 2009-2044 NO X Cap of 494,899 tons at any time prior to December 31, 2044 (under all Alternatives);
3. Additions to § 49.5513(j)(3)(i)(A)(2), (B)(3), and (C)(2), to specify that the NO X emission limit of 0.07 lb/MMBtu is to be calculated based on a rolling average basis of 30 boiler operating days;
4. Correction to § 49.5513(j)(3)(ii)(D), to specify that Alternative B shall also apply if either of the Departing Participants (i.e., LADWP or NV Energy) remains as a participant in NGS;
5. Addition of § 49.5513(j)(3)(iii), consistent with the TWG Agreement, to require the owners of NGS to cease its operation of conventional coal-fired generation at NGS no later than December 22, 2044; (34)
6. Addition to § 49.5513(j)(4)(ii), to change the annual reporting date to begin in 2015 instead of the specific date of January 31, 2015, and specify that the report must be submitted to EPA and also made publicly-available within 30 days of the submittal deadline associated with the annual emission inventory required by the Part 71 Operating Permit for NGS;
7. Addition to § 49.5513(j)(4)(iii), to clarify that the Part 71 Operating Permit for NGS shall incorporate practically enforceable limits for NO X of 0.24 lb/MMBtu, on a 30‐day rolling average basis, for each Unit equipped with LNB/SOFA, and 0.07 lb/MMBtu, on a rolling average basis of 30 boiler operating days, for each Unit equipped with SCR, as federally enforceable permit conditions; and
8. Addition of § 49.5513(j)(4)(iv)(C), to specify that the requirement to submit annual Emission Reduction Plans beginning no later than December 31, 2019, must be incorporated into the Part 71 Operating Permit for NGS as a federally enforceable permit condition.
9. Revision to § 49.5513(j)(7) to require the owner or operator of NGS to maintain records that document compliance with the NO X Cap (e.g., daily emissions and heat input data) for the life of the facility, rather than at least five years.
10. Deletion of § 49.5513(j)(7)(vi) that required record-keeping of all major maintenance activities conducted on emission units, air pollution control equipment, and CEMS because record-keeping of maintenance activities are not needed to ensure compliance with the 2009-2029 and 2009-2044 NO X Caps.
11. Revision to § 49.5513(j)(11) to state that the affirmative defense provisions of paragraphs § 49.5513 (c)(2) and § 49.5513(i) do not apply to paragraph § 49.5513(j). (35)
Revision (1) above is necessary to clarify that EPA is finalizing a “better than BART” alternative in lieu of BART.The BART Benchmark used to assess the “better than BART” alternative is based on our proposed BART determination for NGS, and the “better than BART” alternative is consistent with our Supplemental Proposal of the TWG Alternative. Revision (3) above is necessary because EPA inadvertently did not specify the averaging period associated with the emission limits for NO X in our Supplemental Proposal. Revisions (2) and (4) through (10) above are in response to comments submitted to EPA on our Supplemental Proposal. Revision (11) above amends a proposed provision in our Supplemental Proposal that limited the applicability of the existing affirmative defense provisions for startups, shutdowns, and malfunctions (from the previous FIP for NGS codified at 40 CFR 49.5513(c)(2) and 40 CFR 49.5513(i)) to malfunctions. (36)
In this Final Action, we are revising (j)(11) to make clear that the existing affirmative defense provisions do not apply to the emission limits established in the TWG Alternative.
Following the close of the public comment period, the United States Court of Appeals for the DC Circuit issued a decision concerning various aspects of the NESHAP for Portland cement plants issued by EPA in 2013, including the affirmative defense provision of that rule. (37)
The court found that EPA lacked authority to establish an affirmative defense for private civil suits and held that under the CAA, the authority to determine civil penalty amounts lies exclusively with the courts, not EPA. The court did not address whether such an affirmative defense provision could be properly included in a SIP. However, the court's holding makes it clear that the CAA does not authorize promulgation of such a provision by EPA. In particular, the court's decision turned on an analysis of CAA sections 113 (Federal enforcement) and 304 (Citizen suits). These provisions apply with equal force to a civil action brought to enforce the provisions of a FIP. The logic of the court's decision thus applies to the promulgation of a FIP and precludes EPA from including an affirmative defense provision in a FIP. Therefore, we are not including an affirmative defense provision in the final FIP.
We note that, if a source is unable to comply with emission standards as a result of a malfunction, EPA may use case-by-case enforcement discretion, as appropriate. Further, as the DC Circuit recognized, in an EPA or citizen enforcement action the court has the discretion to consider any defense raised and determine whether penalties are appropriate. (38)
IV. Summary of Major Issues Raised by CommentersThe public comment period for our Proposed Rule opened on February 5, 2013. On two occasions, we extended the comment period