ÿWPCÌ tvØr,ˆ¥#–^¬ÖÉöèbu*Tòa¥\&ŽŠòÚ=­f¯‹ó­¿(i£$²¦ü¾waÌM¸’¸BíÕ‚ÑaZ\ZÌ¡ÂFó|r×÷"çYCl,„È‘ý.Úࣹ~¯8v¦¦6ÚÙ u BÑc•Þ%i¾MÐ0`‰EšŽ‘ï±6 êȬ2ï) È·j³&%èìMæWJ÷ó6,tŸëß[eZ"4ºnÖ{jT›“ÃÚŸuçÜ|TkW1æ«RŸÆ·-Ƭuˆz˜G‰g].aÝs¨B„¶ÙÔP ¾“ï,R¸¯ÖQ±F`··HÏ,oMá•# üUN %U 0([w@ƒ4Ã×UNæ4U .<UFjUB°bòô- UF8UN~˜HP LaserJet 6L (PCL)HPBLA,,ðððð,,0 (ÈhH  Z ‹6Times New Roman RegularX($¡¡ DDDUUEDfF$3|x(ÈhH  Z ‹6Times New Roman Regular< Œ p`‹ArialTT<à09Z ‹.Courier New Regular< Œ p`‹*Times New RomanTT Ñ € Ñ #Ñ#€ÖØXÿÿd#Ñ<à09Z ‹.Courier New Regular(¶ÍY Z ‹6Times New Roman RegularÝ ƒ!ÝÝ  ÝØØØØÔ‡XULXXXÔÑ€äŸÑññÓæÓññà  àà ` àÔ#†XULXXXUL=#ÔÔ‡ Xç—XXXULÔÔ‡ ¼g.¼X Xç—ÔUNITED€STATES€ENVIRONMENTAL€PROTECTION€AGENCYÔ#† Xç—X¼ ¼g.ß#ÔÔ#†XULXX Xç—À#ÔÔ‡XULXXXULÔÐ ° ÐññÓærÓññññÓØÓññà  àà ` àà ¸ à€Ô#†XULXXXULq#ÔÔ‡Xç—XXXULÔOffice€of€Air€Quality€Planning€and€StandardsÐ –æ Ðà  àà ` àà ¸ àResearch€Triangle€Park,€North€Carolina€27711Ô#†XULXXXç—!#ÔÔ‡XULXXXULÔÐ n¾ ÐññÓØÆÓññÌà@AA"ìàJanuary€21,€1998›ˆÌññœññÌÌMr.€Howard€L.€RhodesÌDirector,€Division€of€Air€Resources€ManagementÌFlorida€Department€of€Environmental€ProtectionÌTwin€Towers€Office€BuildingÌ2600€Blair€Stone€RoadÌTallahassee,€Florida€€32399„2400ÌÌDear€Mr.€Rhodes:ÌÌà  àThis€is€in€response€to€your€December€12,€1997€letter€requesting€that€the€EnvironmentalÏProtection€Agency€(EPA)€repeal€the€alternative€fuels€exemption€in€the€prevention€of€significantÏdeterioration€(PSD)€regulations€at€40€CFR€52.21(b)(2)(iii)(e)(1).€€The€corresponding€State€ruleÏunder€Floridaððs€State€implementation€plan€(SIP)€closely€tracks€the€Federal€rule.€€You€request€theÏrepeal€because€you€believe€the€exemption€is€no€longer€relevant,€has€outlived€its€usefulness,€and€isÏnow€being€used,€contrary€to€its€original€intent,€to€justify€the€burning€of€waste€fuels€by€certainÏsources.€€You€are€also€concerned€that€as€a€result€of€œderegulation,›€electric€utilities€will€have€a€bigÏincentive€to€burn€waste€and€dirty€fuels€that€are€cheaper€than€normal€fuels.€€Although€weÏunderstand€your€œconcerns€and€support€the€denial€of€the€PSD€exemption€in€the€Florida€PowerÏCompany€(FPC)€case€described€below,€EPA›€currently€has€no€plans€to€propose€any€changes€to€theÏregulatory€exemption.€€However,€as€discussed€below,€œEPA›€intends€to€review€implementation€ofÏthe€exemption€and€issue€guidance€as€œneeded€to€clarify€the€intent€of€the€exemption.›ÌÌà  àIn€support€of€your€request,€you€refer€to€a€recent€request€by€œthe€FPC›€to€the€FloridaÏDepartment€of€Environmental€Protection€(FDEP)€for€permission€to€blend€petroleum€coke€withÏthe€coal€burned€at€Crystal€River€units€1€and€2.€€Your€letter€also€states€that€as€a€result€of€the€fuelÏblending€the€sulfur€dioxide€emissions€from€the€units€would€increase€by€approximately€9400€tonsÏper€year€without€undergoing€a€PSD€review.€€The€FPC€asserts€that€the€PSD€regulations€exempt€theÏburning€of€petroleum€coke€in€the€units€since€the€State€and€EPA€rules€both€exempt€the€ð ðUse€of€anÏalternative€fuel€or€raw€material€which€the€facility€was€capable€of€accommodating€before€JanuaryÏ6,€œ1975›€œ....ð𛀀In€June€1996€the€FDEP€denied€the€FPCððs€request€to€blend€petroleum€coke.€€TheÏEPA€Region€IV€office€supported€the€denial€agreeing€that€the€project€should€not€be€exempt€fromÏPSD.€€€However,€the€FPC€appealed€the€denial€using€the€Stateððs€administrative€appeals€processÏand€received€a€reversal€of€the€denial€from€an€Administrative€Law€Judge.€€œDespite€theÏAdministrative€Law€Judgeððs€initial€finding,€we›€understand€that€the€denial€has€been€remanded€œbyÏthe€FDEP€back›€to€the€Administrative€Law€Judge€for€further€review.ÌÌÌœà  àà ` àà ¸ àà  àà h àà À àÐ -b(, ÐÑäŸÑÑ7€ULXXdìXXdì7ÑÑ  Ñà  àà ` àà ¸ àà  àà h àà À à„2„Ð ° ÐÌÌ›à  àWe€share€your€concerns€about€the€use€of€the€PSD€exemption€in€the€FPC€case.€€€AlthoughÏœEPA›€believes€the€PSD€exemption€was€not€intended€to€be€used€in€the€FPC€situation,€the€Ìexemption€is€still€appropriate€to€allow€sources€to€switch€between€fuels€that€would€have€otherwiseÏbeen€available€to€the€source€prior€to€January€6,€1975€and€were€otherwise€considered€in€the€designÏof€the€source.€€The€EPA€believes€that€since€petroleum€coke€was€not€a€recognized€fuel€prior€toÏJanuary€6,€1975,€it€should€not€otherwise€come€under€the€exemption.€€The€€EPA€does€not€believeÏthat€regulatory€changes€to€the€exemption€are€needed€at€this€time€based€solely€on€the€FPC€case.€ÏBecause€we€share€many€of€your€concerns,€the€EPAððs€Office€of€Enforcement€and€ComplianceÏAssurance€(OECA)€has€agreed€to€review€implementation€of€the€exemption€by€EPA€and€theÏStates.€€€After€reviewing€the€situation,€œEPA›€may€issue€guidance€that€œfurther€clarifies›€the€intent€ofÏthe€exemption.€€ÌÌà  àYou€may€contact€Carol€Holmes€of€OECA€at€(202)€564„8709€for€questions€about€theÏœEPAððs€review€of€the€exemption.€€If›€you€have€any€general€questions€about€the€response,€you€mayÏcontact€Mike€Sewell€of€the€Integrated€œImplementation›€Group€at€(919)€541„0873.€€ÌÌà  àI€appreciate€this€opportunity€to€be€of€service€and€trust€that€this€information€will€be€helpfulÏto€you.ÌÌ€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€œSincerely,›ÌÌœ€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€/s/€Henry€Thomas€for›ÌÌ€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€John€S.€SeitzÌ€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€DirectorÌ€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€Office€of€Air€Quality€PlanningÌ€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€and€StandardsÌœÌÌÌÌÌÌÐ  à%0!$ ÐÔ#†XULXXXULô#ÔññÔ‡ôªÜôXXULÔññÓ ™°œXÓññÔ#†XULXôôªÜÇ#ÔÔ‡ Y XXULÔññÑ€§ÑÔ‡ XèìXXXULÔññÔ#† XèìX  ¡Õ'#ÔññÔ‡ ká;kX XèìÔÓ! “™!Ó€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€Department€ofÐ ° ÐÓ! 3“!ÓÔ#† XèìXk ká;y#ÔÔ‡ ÀX XèìÔò ò€€€€€€€€€€€€€€€€€€€€€€€€€Environmental€ProtectionÐ þN ÐÓ$­EÒ3$Óñ ñÓ®Óñ ñàQ]] ]àÔ#† XèìX ÀF#ÔÔ€ ?—X XèìÔˆàQŠŠõàÔ‡ ©•ë © ?—Ôó óTwin€Towers€Office€BuildingˆÐ ŽÞ ÐàQ¤¤]àLawton€ChilesˆàQ44"õà2600€Blair€Stone€RoadˆÐ <Œ Ðñ ñÓ®×Óñ ñàQ99 ]àGovernorˆàQóóõàTallahassee,€Florida€32399„2400ˆÐ ê: ÐÌÔ#†©ˆ¹ © © ©•ë-#ÔÔ‡ ©ˆ¹ © ©©ˆ¹ÔÔ#† ¯ © ©ˆ¹Q#ÔÔ‡  Y  ¯ÔÓ$ õ­EÒ$Óà‘ðð¥ à€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€December€12,€1997ˆÐ . ~ ÐÓ ZõÓÓ  ÓÔ#† ¯  Yå#ÔÔ‡ ©ˆ¹ © ¯Ô€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€Virginia€B.€WetherellÐ ú J Ѐ€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€SecretaryÔ#† ¯ © ©ˆ¹#ÔÔ‡ ©ˆ¹ © ¯ÔÔ#†©ˆ¹ © © ©ˆ¹£#ÔÔ‡ ©ˆ¹ © ©©ˆ¹Ô€€€€€€€€€€Ð   ð Ðññ€€€€€€ññ€ññ€Ì¹ññ¹Ó  ÓÔ#† ¯ © ©ˆ¹ò#ÔÔ‡  Y  ¯ÔÓ ÷ ZÓMr.€John€Seitz,€Director,Ð ì <  ÐOffice€of€Air€Quality€Planning€and€StandardsÌU.S.€Environmental€Protection€AgencyÌResearch€Triangle€Park,€North€Carolina€27711ÌÌÓ %÷ ÓRe:€Request€to€Repeal€Alternative€Fuel€PSD€ExemptionÌÌÓ%ÓDear€Mr.€Seitz:ÌÌÓ 3ÓÓ 3ÓThe€Florida€Department€of€Environmental€Protection€(FDEP)€requests€that€EPA€repeal€an€exemption€to€itsÏrules€for€the€Prevention€of€ò òSignificant€Deterioration€of€Air€Quality€(PSD)€found€at€40€CFRÐ ä4 Ðó ó52.21(b)(2)(iii)(e)(I).€The€rule€exempts€from€PSD€review€"Use€of€an€alternative€fuel€or€raw€material€which€theÐ ´ Ðsource€was€capable€of€accommodating€before€January€6,€1975,€unless€such€change€would€be€prohibited€underÏany€federally€enforceable€permit€condition€which€was€established€after€January€6,€1975€pursuant€to€40€CFRÏ52.21€or€under€regulations€approved€pursuant€to€40€CFR€subpart€I€or€40€CFR€51.166;..."€The€correspondingÏState€rule€under€our€approved€State€Implementation€Plan€(SIP)€closely€tracks€the€federal€rule.€We€recommendÏrepeal€of€the€alternative€fuel€part€of€the€exemption,€but€not€necessarily€the€raw€material€portion.ÌÓ 3ÓÌÓ 33ÓÓ 3ÓIn€a€recent€case,€FDEP€initially€denied€a€permit€to€Florida€Power€Corporation€(FPC)€to€add€5€percentÏpetroleum€coke€with€a€sulfur€dioxide€emission€potential€of€6.57€pounds€per€million€Btu€heat€input€(lbÏS02/mmBtu)€to€the€coal€burned€at€two€units€at€its€Crystal€River€facility.€The€S02€limit€for€these€units€is€2.1Ïlb/mmBtu.€In€recent€years,€the€units€have€emitted€an€average€of€1.6€lb/mmBtu€while€burning€coal.€TheÏDepartment€determined€that€PSD€applied€to€this€change€in€method€of€operation€because€S02€emissions€wouldÏincrease,€per€FPC's€estimate,€by€approximately€9400€tons€per€year€(TPY)€due€to€the€potent€sulfurÏcharacteristics€of€the€petroleum€coke€to€be€blended€with€the€contract€coal.ÌÓ 3ÓÌÓ 33ÓÓ 3ÓFPC€claimed€the€subject€exemption€from€PSD€contending€that€it€could€have€fired€a€95€percent€coal/€5Ïpercent€petroleum€coke€blend€prior€to€1975.€However€the€FDEP€determined€that€it€did€not€apply€because€theÏfacility€was€not€burning€coal€(let€alone€a€coal/petroleum€coke€blend)€on€January€6,€1975€and€were€not€able€toÏdo€so€until€several€years€after€being€ordered€in€mid„€1975€to€switch€(back)€to€coal€by€the€Federal€EnergyÏAdministration.€Major€expenditures€were€involved€to€return€the€units€to€their€coal€firing€capability€in€the€lateÏ1970's.€Additionally€the€FDEP€determined€that€the€action€of€adding€5€percent€petroleum€coke€was€not€actuallyÏa€switch€to€an€alternative€fuel€such€that€the€exemption€could€be€considered.€Furthermore€the€FDEP€determinedÏthat€such€a€fuel€use€did€not€fit€the€purpose€of€the€original€exemption€as€described€in€the€modification€definitionÏgiven€in€the€original€New€Source€Performance€Standards€(NSPS)€issued€in€1971€and€with€which€the€PSD€rulesÏmust€ultimately€comport€per€the€1977€Clean€Air€Act.ÌÓ 3ÓÌÓ 33ÓÓ 3ÓThe€subject€exemption€first€appeared€in€a€1971€NSPS€rule€(Federal€Register,€Vol.€36,€No.€247€at€pageÏ24877).€The€EPA€stated€that€the€definition€of€modification€was€clarified€to€exclude€"fuel€switches€if€theÏequipment€was€originally€designed€to€accommodate€such€fuels."€The€justification€given€for€the€exemption€wasÏto€"eliminate€inequities€where€equipment€had€been€put€into€partial€operation€prior€to€the€proposal€of€theÏstandards."€In€the€litigation€with€FPC,€the€Department€claimed€that€FPC€failed€to€demonstrate€the€useÐ œ-ì(3 ÐÓ 3ÓÔ#† Y   Y4#ÔÔ#†¯  YÀ#ÔÔ‡©ˆ¹ ©¯ÔÓ3ÓÔ‡ ©ˆ¹ © ©©ˆ¹ÔMr.€John€SeitzÐ ° ЀDecember€12,€1997€ÌPage€2ÌÌÔ#† ¯ © ©ˆ¹š-#ÔÔ‡  Y  ¯Ôof€petroleum€coke€as€a€fuel€was€designed€into€the€source€(i.e.,€the€construction€plans€and€specifications€did€notÐ H˜ Ðcontemplate€the€use€of€petroleum€coke€as€a€fuel).€It€necessarily€follows€that€there€is€no€equity€consideration€inÏFPC's€proposed€project€because€FPC€is€already€able€to€make€full€use€of€its€equipment€by€firing€coal€asÏoriginally€intended.€The€FPC€proposal€to€add€5€percent€petroleum€coke€is€not€eligible€for€exemption€as€a€"fuelÏswitch"€as€discussed€in€the€NSPS.€The€action€is€not€a€switch€from€one€fuel€to€another,€but€rather€the€addition€ofÏsmall€amounts€of€a€waste€fuel€with€potent€sulfur€concentrations€to€an€approved€fuel.€This€change€in€operationÏclearly€fits€within€the€definition€of€a€modification.ÌÌÓ 0ÓÓ 0ÓThe€FDEP's€position€was€fully€ò òsupported€by€EPA€Region€IV's€letters€dated€ó óFebruary€14€and€June€2,Ð ¨ ø  Ð1997.€EPA€also€commented€on€the€absurdity€that€coal€and€minor€amounts€of€any€waste€fuel,€additive,€orÏmodifier€might€be€considered€an€alternative€fuel€for€the€purposes€of€the€subject€exemption.€A€hearing€was€heldÏthis€past€June.€The€Administrative€Law€Judge€ruled€that€the€plain€reading€of€the€rule€seems€to€support€FPC'sÏinterpretation.€FDEP's€interpretation€and€analyses€are€consistent€with€memoranda,€original€preambles,€andÏother€EPA€interpretations€of€the€exemption.€The€judge€agreed€with€FPC's€claim€that€Region€IV€hadÏmisapprehended€the€facts€in€formulating€its€opinion.ÌÓ 0ÓÌÓ 00ÓÓ 0ÓThe€implications€of€the€judge's€decision€are€that€PSD€and€NSPS„exempt€facilities€(grandfathered€facilities)Ïcan€blend€wastes€and€dirty€fuels€they€never€intended€to€use€into€their€regular€fuel€through€a€provision€whichÏwas€intended€only€to€allow€them€to€realize€design€capacity.€These€FPC€units€already€operated€at€designÏcapacity€in€terms€of€the€fuels€they€were€previously€permitted€to€bum€(coal,€oil,€and€gas).€The€result€is€thatÏsubstantial€emissions€increases€from€such€grandfathered€units€can€occur€with€relative€ease.€FDEP€believes€thisÏis€clearly€an€unintended€consequence€of€a€well„meaning€rule.ÌÓ 0ÓÌÓ 00ÓÓ 0ÓAt€this€time€of€electrical€deregulation,€utilities€have€a€big€incentive€to€add€cheaper€and€dirtier€fuels€andÏwastes€to€their€normal€fuels.€In€this€state€the€grandfathered€units€are€now€starting€to€compete€in€the€waste€fuelÏmarket€with€facilities€that€were€specifically€designed€to€bum€such€dirty€fuels€in€a€responsible€manner.€TheseÏgrandfathered€units€have€an€advantage€over€cleaner,€scrubber„equipped,€electric€units€which€have€beenÏrequired€by€FDEP€to€abate€emission€increases€resulting€from€burning€petroleum€coke€or€be€(re)subjected€toÏPSD€review.ÌÓ 0ÓÌÓ 00ÓÓ 0ÓFDEP€recommends€repeal€of€the€alternative€fuel€exemption€portion€of€the€rule.€It€has€outlived€its€expectedÏuseful€lifetime€just€as€many€of€the€sources€seeking€to€use€it€have€outlived€their€intended€useful€lifetimes.ÏTwenty„six€(26)€years€have€passed€since€the€NSPS€fuel€exemption€was€promulgated€while€23€years€haveÏpassed€since€the€PSD€version€of€the€exemption€was€promulgated.€It€is€reasonable€to€assume€that€any€facilityÏbuilt€prior€to€the€passage€of€the€rule€and€needing€it€to€make€use€of€its€full€design€capacity€has€already€done€so.ÏUntil€the€rule€is€repealed,€we€recommend€that€E!,!,€clarify€the€intent€of€both€versions€of€the€rule€to€insure€thatÏthey€are€applied€only€to€fuel€switches€clearly€contemplated€and€specified€during€original€design.€TheÏexemptions€should€be€very€narrow€in€view€of€their€absence€from€the€CAA.ÌÓ 0ÓÌÓ 00ÓÓ 0ÓOur€contacts€at€Region€IV€were€Brian€Beals€and€Gregg€Worley€at€404/562„9098€and€562„9141Ïrespectively.€They€were€extremely€helpful€during€our€evaluation€of€this€case€and€can€provide€you€with€some€ofÏthe€details€and€implications€from€their€perspective.€If€you€have€any€questions,€please€call€me€at€850/488„0114ÌÓ 0ÓÌÓ !0ÓSincerelyÌÌÓ © !ÓHoward€L.€Rhodes,€DirectorÌDivision€of€Air€Resources€ManagementÌÌÓ † © Ócc:€Mr.€Winston€Smith,€EPA€Region€IVÐ Œ-Ü(4 ÐѧÑÑ€ ÑÑ  ÑÔ#† Y   YÔ-#ÔÔ#†¯  YU.#ÔÔ‡¯¯ÔÌÌÌÌÌÔ#†¯¯?#ÔÔ‡ nF¯ÔÔ‡ ¼g.¼ nFÔññÔ#†¼º  ¼¼ ¼g.Æ?#ÔññññÔ‡¼º  ¼ ¼¼º Ôññññ€€€€€€€€€ññUNITED€STATES€ENVIRONMENTAL€PROTECTION€AGENCYÔ#†¯ ¼¼º å?#ÔÔ‡XULX¯ÔññññÔ#†XULXX Xç—ÿ?#ÔññññÐ ¼  Ðà‘ðð6à€ññññÔ‡ Xç—XXXULÔññññññ€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€ññOffice€of€Air€Quality€Planning€and€StandardsññÌñññ ñññà‘66"6àà‘66"6àñññ ñññ¼¼¼¼ññˆ¼à‘ðð6àññ€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€ññResearch€Triangle€Park,€North€Carolina€27711ññÔ#†XULXXXUL6@#ÔññññññÔ#†XULXX Xç—MA#ÔññññˆÐ ¸  ÐÔ#†¯XXUL½@#ÔÔ‡¯¯ÔÌÌÌÔ#†¯¯GC#ÔÔ‡XULX¯Ôà@AA"ìàJanuary€21,€1998ˆÐ x È  ÐÌññÌññññÌÌÌÌññÌMs.€Sandra€V.€SilvaÌChief,€Air€Quality€BranchÌFish€and€Wildlife€ServiceÌUnited€States€Department€of€the€InteriorÌWashington,€D.C.€€20240ÌÌDear€Ms.€Silva:ÌÌññÌññà‘ðð6à€€€€€€€€€€€€€€€€€€€This€is€in€response€to€your€November€26,€1997€letter€requesting€that€the€EnvironmentalˆÏProtection€Agency€(EPA)€repeal€the€alternative€fuels€exemption€in€the€prevention€of€significantÏdeterioration€(PSD)€regulations€at€40€CFR€52.21(b)(2)(iii)(e)(1).€€You€request€the€repeal€becauseÏyou€believe€the€exemption€is€no€longer€relevant,€has€outlived€its€usefulness,€and€is€now€beingÏused,€contrary€to€its€original€intent,€to€justify€the€burning€of€waste€fuels€by€certain€sources.€€YouÏsuggest€that€a€repeal€be€part€of€the€upcoming€rulemaking€on€new€source€review€(NSR)Ïregulations€for€transitional€areas€under€the€new€8„hour€ozone€standard.€€Although€we€understandÏyour€concerns€and€support€the€denial€of€the€PSD€exemption€in€the€Florida€Power€CompanyÏ(FPC)€case€described€below,€EPA€does€not€plan€to€propose€any€changes€to€the€exemption€in€theÏupcoming€NSR€rulemaking€for€transitional€areas.€€However,€as€discussed€below,€EPA€intends€toÏreview€implementation€of€the€exemption€and€issue€guidance€as€needed€to€clarify€the€intent€of€theÏexemption.ÌÌà‘ðð6à€€€€€€€€€€€€€€€€€€€In€support€of€your€request,€you€referred€to€a€recent€request€by€the€FPC€to€the€Florida€DepartmentˆÏof€Environmental€Protection€(FDEP)€for€permission€to€blend€petroleum€coke€with€the€coalÏburned€at€Crystal€River€units€1€and€2.€€Your€letter€states€that€as€a€result€of€the€fuel€blending€theÏsulfur€dioxide€emissions€from€the€units€would€increase€by€approximately€9400€tons€per€yearÏwithout€undergoing€a€PSD€review.€€The€FPC€asserts€that€the€PSD€regulations€exempt€the€burningÏof€petroleum€coke€in€the€units€since€the€State€and€EPA€rules€both€exempt€the€ð ðUse€of€anÏalternative€fuel€or€raw€material€which€the€facility€was€capable€of€accommodating€before€JanuaryÏ6,€1975€....ðð€€In€June€1996€the€FDEP€denied€the€FPCððs€request€to€blend€petroleum€coke.€€TheÏEPA€Region€IV€office€supported€the€denial€agreeing€that€the€project€should€not€be€exempt€fromÏPSD.€€However,€the€FPC€appealed€the€denial€using€the€Stateððs€administrative€appeals€process€andÏreceived€a€reversal€of€the€denial€from€an€Administrative€Law€Judge.€€Despite€the€AdministrativeÏLaw€Judgeððs€initial€finding,€we€understand€that€the€denial€has€been€remanded€by€the€FDEP€backÏto€the€Administrative€Law€Judge€for€further€review.Ð ¨-ø(/ Їññ€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€ññññññ€ññññññ„2„ññ¼à‘66"6àˆÌññÌññÌññññÌññññà‘ðð6à€€€€€€€€€€€€€€€€€€€We€share€your€concerns€about€the€use€of€the€PSD€exemption€in€the€FPC€case.€€Although€EPAˆÏbelieves€the€PSD€exemption€was€not€intended€to€be€used€in€the€FPC€situation,€the€exemption€isÏstill€appropriate€to€allow€sources€to€switch€between€fuels€that€would€have€otherwise€beenÏavailable€prior€to€January€6,€1975€to€the€source€and€were€otherwise€considered€in€the€design€ofÏthe€source.€€The€EPA€believes€that€since€petroleum€coke€was€not€a€recognized€fuel€prior€toÏJanuary€6,€1975,€it€would€not€otherwise€come€under€the€exemption.€€The€€EPA€does€not€believeÏthat€regulatory€changes€to€the€exemption€are€needed€at€this€time€based€solely€on€the€FPC€case.€ÏBecause€we€share€many€of€your€concerns,€EPAððs€Office€of€Enforcement€and€ComplianceÏAssurance€(OECA)€has€agreed€to€review€implementation€of€the€exemption€by€EPA€and€theÏStates.€€After€reviewing€the€situation,€EPA€may€issue€guidance€that€further€clarifies€the€€intent€ofÏthe€exemption.€€ÌÌà‘ðð6à€€€€€€€€€€€€€€€€€€€You€may€contact€Carol€Holmes€of€OECA€at€(202)€564„8709€for€questions€about€the€EPAððsˆÏreview€of€the€exemption.€€If€you€have€any€general€questions€about€this€response,€you€may€contactÏMike€Sewell€of€the€Integrated€Implementation€Group€at€(919)€541„0873.ÌÌà‘ðð6à€€€€€€€€€€€€€€€€€€€€I€appreciate€this€opportunity€to€be€of€service€and€trust€that€this€information€will€be€helpful€toˆÏyou.ÌÌ€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€Sincerely,Ì€€€Ì€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€/s/€Henry€Thomas€forÌ€€€Ì€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€John€S.€SeitzÌ€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€DirectorÌ€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€Office€of€Air€Quality€PlanningÌ€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€and€StandardsÔ#†¯XXULŒC#ÔÐ €Ð ÐÐ  l¼ ÐÔ‡ ¯¯ÔÔ‡  [  ¯Ô€€€€€€€€€€€€€€€€€€€€€€€€€€€€€United€States€Department€of€the€InteriorÐ ° ÐÔ#† ¯  [°V#ÔÔ‡ ôªÜô ¯ÔÌ€€à‘ðð6à€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€FISH€AND€WILDLIFE€SERVICEÔ#† ¯ô ôªÜLW#ÔÔ‡ ôªÜô ¯ÔÔ#†ôªÜôô ôªÜ‘V#ÔÔ‡ ôªÜôôôªÜԈР®þ Ѐ€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€WASHINGTON,€D.C.€20240Ô#† ¯ô ôªÜX#ÔÔ‡  [  ¯ÔÐ r ÐÌÓ† ÓÔ#† [   X#ÔÔ‡  :>   [ÔÔ#† ?—  :> Y#Ôò òÔ‡ ^>3^ ?—ÔADDRESS€ONLY€THE€DIRECTOR,€Ð p À ÐMM€AND€WILDLIFE€SERVICEÔ#† ?—^ ^>3ÄY#ÔÔ‡  :>  ?—ÔÐ ú J ÐÌÔ#† [   :>Y#ÔÔ‡  [   [ÔÔ#† ¯  Z#ÔÔ‡ ?Ç¥? ¯Ôó óÓ ß‘ ÓÓ ßÓNovember€26,€1997Ð ¾  ÐÓ ßÓÌÓ! U ß‘ !ÓÓ  ÓÔ#† ¯? ?Ç¥çZ#ÔÔ‡ ôªÜô ¯ÔÌÓ  ÓÌÔ#† ¯ô ôªÜº[#ÔÔ‡ ?Ç¥? ¯ÔÓ <U ÓDear.€John€SeitzÐ V  ÐOffice€of€Air€Quality€Planning€and€StandardsÌU.S.€Environmental€Protection€AgencyÌMail€Drop€10ÌResearch€Triangle€Park,€North€Carolina€27711ÌÌÓ<ÓDear€Mr.€Seitz:€ÌÌThe€U.€S.€Fish€and€Wildlife€Service€(FWS)€requests€that€EPA€repeal€the€alternative€fuel€exemption€ofÏthe€Prevention€of€Significant€Deterioration€(PSD)€regulations€at€40€CFR€52.21(b)(2)(iii)(e)(1).€WeÏsuggest€that€this€be€accomplished€through€the€transitional€New€Source€Review€reform€regulations,Ïwhich€we€understand€will€be€out€for€review€shortly.€FWS€believes€that€the€alternative€fuel€exemptionÏrule,€promulgated€in€the€1970's,€is€no€longer€relevant€and€has€outlived€its€usefulness.€In€fact,€the€ruleÏis€now€being€used,€contrary€to€its€original€intent,€to€justify€the€burning€of€waste€fuels€by€certainÏsources.€For€example,€the€Florida€Power€Company€(FPC)€has€recently€requested€the€alternative€fuelsÏexemption€for€FPC's€permit€application€to€blend€5€percent€petroleum€coke€with€the€coal€burned€in€itsÏCrystal€River€Units€I€and€2.€In€usual€circumstances,€this€fuel€change€would€trigger€PSD€reviewÏbecause€sulfur€dioxide€emissions€would€increase€by€approximately€9400€tons€per€year.€However,ÏFPC.€asserts€that€a€rule€in€Florida's€State€Implementation€Plan€exempts€from€PSD€review€the€"Use€ofÏan€alternative€fuel€or€raw€material€which€the€facility€was€capable€of€accommodating€before€January€6,Ï1975,..."€Florida's€rule€tracks€the€EPA€rule€(referenced€above).ÌÌThe€Florida€Department€of€Environmental€Protection€denied€FPC's€request€in€June€1996.€EPA€RegionÏIV€supported€FDEP's€decision€in€letters€of€February€1996€and€June€1996,€agreeing€that€the€projectÏshould€not€be€exempt€from€PSD€review.€EPA€Region€IV€noted€that€petroleum€coke€is€considered€aÏwaste€product,€not€a€fossil€fuel,€and€adding€it€to€coal€does€not€make€the€blend€an€"alternative€fuel."ÏHowever,€FPC€subsequently€petitioned€for€a€Formal€Administrative€Hearing€and,€as€a€result€of€thatÏhearing,€an€Administrative€Law€Judge€ruled€in€favor€of€FPC.€Apparently,€the€judge€believed€that€aÏplain€reading€of€the€exemption€rule€allowed€FPC's€interpretation,€whereas€FDEP's€interpretationÏdepended€on€analyses€of€memoranda,€original€preambles,€and€interpretations€of€intent.ÌÌWe€are€very€concerned€that€the€judge's€decision€set€a€precedent€for€"grandfathered"€facilities€to€blendÏwaste€fuels€with€their€present€fuels€through€the€use€of€this€exemption€rule.€As€a€result,€substantialÏemissions€increases€will€occur€without€PSD€review,€clearly€an€unintended€consequence€of€the€rule.ÌÐ  Æ,(. ÐÓ õÓ€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€„2„ÌÌÓõÓFWS€believes€that€the€alternative€fuels€exemption€rule€should€be€repealed€to€prevent€similarÏmisapplications.€As€you€know,€the€rule€is€not€mentioned€in€the€Clean€Air€Act€(or€subsequentÏamendments),€but€first€appeared€in€a€1971€NSPS€rule.€The€rule€was€incorporated€in€the€PSDÏregulations€in€1974.€Over€20€years€have€passed€since€the€rule€was€promulgated,€and€it€is€reasonable€toÏassume€that€any€facility€built€prior€to€the€passage€of€the€PSD€rule€and€needing€the€exemption€to€makeÏuse€of€their€full€design€has€already€done€so.€Until€the€rule€is€repealed,€we€recommend€that€EPA€clarifyÏthe€intent€of€the€rule€to€insure€that€it€is€only€applied€to€fuel€switches€clearly€contemplated€andÏspecified€during€original€design.€The€exemptions€should€be€very€narrow€in€view€of€their€absence€fromÏthe€Clean€Air€Act.ÌÌPlease€inform€us€of€your€decision€in€this€matter.€If€you€have€questions,€please€call€me€(303„969„2814)Ïor€Ellen€Porter€(303„969„2617)€at€our€Air€Quality€Branch.ÌÌÓ ½ÓSincerely,ÌÌÓ f½ÓSandra€V.€SilvaÌChief€Air€Quality€BranchÌÌÓ$Opf$Ócc:à ÿ àMr.€John€Harkinson,€Jr.à à àMr.€Doug€Neeley,€ChiefÐ 0€ Ðà ÿ àRegional€Directorà à àAir€and€Radiation€BranchÐ ` Ðà ÿ àU.S.€EPA,€Region€4à à àU.S.€EPA,€Region€4Ð ð@ Ðà ÿ à100€Alabama€St.,€SWà à à100€Alabama€St.,€SWÐ Ð  Ðà ÿ àAtlanta,€Georgia€30303à à àAtlanta,€Georgia€30303Ð ° ÐÌÓ$ _Op$ÓMs.€Virginia€Wetherell,€SecretaryÌFlorida€Department€of€Environmental€ProtectionÌTwin€Towers€Office€BuildingÌ2600€Blair€Stone€RoadÌTallahassee,€Florida€32399„2400ÌÌÓ ]_ÓMr.€Howard€RhodesÌChief,€Division€of€Air€Resources€ManagementÌFlorida€Department€of€Environmental€ProtectionÌTwin€Towers€Office€BuildingÌ2600€Blair€Stone€RoadÌTallahassee,€Florida€32399„2400ÌÌÓ a]ÓMr.€Clair€FancyÌChief,€Bureau€of€Air€RegulationÌFlorida€Department€of€Environmental€ProtectionÌTwin€Towers€Office€BuildingÌ2600€Blair€Stone€RoadÌTallahassee,€Florida€32399„2400ÌÔ#†?Ç¥?? ?Ç¥¥Z#ÔÔ#†¯??Ç¥ \#Ô