[Federal Register Volume 77, Number 234 (Wednesday, December 5, 2012)]
[Rules and Regulations]
[Pages 72511-72580]
[FR Doc No: 2012-28565]

Vol. 77

Wednesday,

No. 234

December 5, 2012

Part III

Environmental Protection Agency

-----------------------------------------------------------------------

40 CFR Part 52

Approval, Disapproval and Promulgation of Air Quality Implementation
Plans; Arizona; Regional Haze State and Federal Implementation Plans;
Final Rule

Federal Register / Vol. 77 , No. 234 / Wednesday, December 5, 2012 /
Rules and Regulations

-----------------------------------------------------------------------

ENVIRONMENTAL PROTECTION AGENCY

40 CFR Part 52

[EPA-R09-OAR-2012-0021, FRL-9754-3]

Approval, Disapproval and Promulgation of Air Quality
Implementation Plans; Arizona; Regional Haze State and Federal
Implementation Plans

AGENCY: Environmental Protection Agency (EPA).

ACTION: Final rule.

-----------------------------------------------------------------------

SUMMARY: EPA is taking final action to approve in part and disapprove
in part a portion of Arizona's State Implementation Plan (SIP)
submittal for its regional haze program and to promulgate a Federal
Implementation Plan (FIP) for the disapproved elements of the SIP. The
State and Federal plans are to implement the regional haze program in
Arizona for the first planning period through 2018. This final rule
addresses only the portion of the SIP related to Arizona's
determination of Best Available Retrofit Technology (BART) to control
emissions from eight units at three electric generating stations:
Apache Generating Station, Cholla Power Plant and Coronado Generating
Station. Consistent with our proposal, EPA approves in this final rule
the State's determination that the three sources are subject to BART,
and approves the State's emissions limits for sulfur dioxide
(SO2) and particulate matter less than or equal to 10
micrometers (PM10) at all the units, but disapproves
Arizona's BART emissions limits for nitrogen oxides (NOX) at
the coal-fired units of the three power plants. We also are
promulgating a FIP that contains new emissions limits for
NOX at these coal-fired units and compliance schedules for
implementation of BART as well as requirements for equipment
maintenance, monitoring, recordkeeping and reporting for all units and
all pollutants at the three sources. In today's action, we are revising
some elements of the proposed FIP in response to comments and
additional information that we received.

DATES: Effective date: This rule is effective January 4, 2013.
    Compliance dates: The owners/operators of each unit subject to this
final rule shall comply by the dates specified in the regulatory text.

ADDRESSES: EPA has established docket number EPA-R09-OAR-2012-0021 for
this action. Generally, documents in the docket are available
electronically at http://www.regulations.gov or in hard copy at EPA
Region 9, 75 Hawthorne Street, San Francisco, California. Please note
that while many of the documents in the docket are listed at http://www.regulations.gov, some information may not be specifically listed in
the index to the docket and may be publicly available only at the hard
copy location (e.g., copyrighted material, large maps, multi-volume
reports or otherwise voluminous materials), and some may not be
available at either locations (e.g., confidential business
information). To inspect the hard copy materials, please schedule an
appointment during normal business hours with the contact listed
directly below.

FOR FURTHER INFORMATION CONTACT: Thomas Webb, U.S. EPA, Region 9,
Planning Office, Air Division, Air-2, 75 Hawthorne Street, San
Francisco, CA 94105. Thomas Webb can be reached at telephone number
(415) 947-4139 and via electronic mail at<EMAIL_ADDRESS>
SUPPLEMENTARY INFORMATION: Throughout this document, wherever ``we,''
``us,'' or ``our,'' is used, we mean the United States Environmental
Protection Agency (EPA).

Definitions

    For the purpose of this document, we are giving meaning to certain
words or initials as follows:
    (1) The words or initials CAA or Act mean or refer to the Clean Air
Act, unless the context indicates otherwise.
    (2) The initials ACC refer to the Arizona Corporation Commission.
    (3) The initials ACCCE mean or refer to American Coalition for
Clean Coal Electricity.
    (4) The initials ADEQ mean or refer to the Arizona Department of
Environmental Quality.
    (5) The initials AEPCO mean or refer to Arizona Electric Power
Cooperative.
    (6) The initials AFUDC mean or refer to allowance for funds used
during construction.
    (7) The term Apache refers to Apache Generating Station.
    (8) The initials APS mean or refer to Arizona Public Service
Company.
    (9) The words Arizona and State mean the State of Arizona.
    (10) The initials BART mean or refer to Best Available Retrofit
Technology.
    (11) The term BART units refers to Apache Generating Station Units
1, 2 and 3; Cholla Power Plant Units 2, 3 and 4 and Coronado Generating
Station Units 1 and 2.
    (12) The initials CBI mean or refer to Confidential Business
Information.
    (13) The initials CCM mean or refer to EPA's Cost Control Manual.
    (14) The initials CEMS mean or refer to continuous emission
monitoring system.
    (15) The term Cholla refers to Cholla Power Plant.
    (16) The term Class I area refers to a mandatory Class I Federal
area.\1\
---------------------------------------------------------------------------

    \1\ Although states and tribes may designate as Class I
additional areas which they consider to have visibility as an
important value, the requirements of the visibility program set
forth in section 169A of the CAA apply only to ``mandatory Class I
Federal areas.''
---------------------------------------------------------------------------

    (17) The term coal-fired BART units refers to Apache Generating
Station Units 2 and 3; Cholla Power Plant Units 2, 3 and 4 and Coronado
Generating Station Units 1 and 2.
    (18) The initials COFA mean or refer to close-coupled overfire air.
    (19) The term Coronado refers to Coronado Generating Station.
    (20) The initials CY mean or refer to Calendar Year.
    (21) The initials EGU mean or refer to Electric Generating Unit.
    (22) The initials ESPs mean or refer to electrostatic
precipitators.
    (23) The words EPA, we, us or our mean or refer to the United
States Environmental Protection Agency.
    (24) The initials FGD mean or refer to flue gas desulfurization.
    (25) The initials FGR mean or refer to flue gas recirculation.
    (26) The initials FIP mean or refer to Federal Implementation Plan.
    (27) The initials FLMs mean or refer to Federal Land Managers.
    (28) The initials FR mean or refer to the Federal Register.
    (29) The initials GEP mean or refer to Good Engineering Practice.
    (30) The initials IMPROVE mean or refer to Interagency Monitoring
of Protected Visual Environments monitoring network.
    (31) The initials IWAQM mean or refer to Interagency Workgroup on
Air Quality Modeling.
    (32) The initials IPM mean or refer to Integrated Planning Model.
    (33) The initials LNB mean or refer to low-NOX burners.
    (34) The initials LTS mean or refer to Long-Term Strategy.
    (35) The initials MMBtu mean or refer to Million British thermal
units.
    (36) The initials MW mean or refer to megawatts.
    (37) The initials MWh mean or refer to megawatt hours.
    (38) The initials NEI mean or refer to National Emission Inventory.
    (39) The initials NH3 mean or refer to ammonia.
    (40) The initials NOX mean or refer to nitrogen oxides.
    (41) The initials NP mean or refer to National Park.

    (42) The initials NPRM mean or refer to Notice of Proposed
Rulemaking.
    (43) The initials O&M mean or refer to operation and maintenance.
    (44) The initials OC mean or refer to organic carbon.
    (45) The initials OFA mean or refer to over fire air.
    (46) The initials PM mean or refer to particulate matter.
    (47) The initials PM10 mean or refer to particulate
matter with an aerodynamic diameter of less than 10 micrometers (coarse
particulate matter).
    (48) The initials PM2.5 mean or refer to fine
particulate matter with an aerodynamic diameter of less than 2.5
micrometers.
    (49) The initials PNG mean or refer to pipeline natural gas.
    (50) The initials ppm mean or refer to parts per million.
    (51) The initials PSD mean or refer to Prevention of Significant
Deterioration.
    (52) The initials RACT mean or refer to Reasonably Available
Control Technology.
    (53) The initials RAVI mean or refer to Reasonably Attributable
Visibility Impairment.
    (54) The initials RATA mean or refer to relative accuracy test
audit.
    (55) The initials RHR mean or refer to the Regional Haze Rule,
originally promulgated in 1999 and codified at 40 CFR 51.301-309.
    (56) The initials RMB refer to RMB Consulting & Research, Inc.
    (57) The initials RMC mean or refer to Regional Modeling Center.
    (58) The initials RP mean or refer to Reasonable Progress.
    (59) The initials RPG or RPGs mean or refer to Reasonable Progress
Goal(s).
    (60) The initials RPOs mean or refer to regional planning
organizations.
    (61) The initials SCR mean or refer to Selective Catalytic
Reduction.
    (62) The initials SIP mean or refer to State Implementation Plan.
    (63) The initials SNCR mean or refer to Selective Non-catalytic
Reduction.
    (64) The initials SO2 mean or refer to sulfur dioxide.
    (65) The initials SOFA mean or refer to separated over fire air.
    (66) The initials SRP mean or refer to Salt River Project
Agricultural Improvement and Power District.
    (67) The initials TCI mean or refer to total capital investment.
    (68) The initials tpy mean tons per year.
    (69) The initials TSD mean or refer to Technical Support Document.
    (70) The initials VOC mean or refer to volatile organic compounds.
    (71) The initials WA mean or refer to Wilderness Area.
    (72) The initials WEP mean or refer to Weighted Emissions
Potential.
    (73) The initials WFGD mean or refer to wet flue gas
desulfurization.
    (74) The initials WRAP mean or refer to the Western Regional Air
Partnership.

Table of Contents

I. Background
    A. Summary of Our Proposed Action
    B. Legal Basis for Our Final Action
II. Overview of Final Action
III. Final BART Determinations
IV. EPA's Responses to Comments
    A. General Comments on ADEQ's Approach to BART
    B. Comments on ADEQ's Individual BART Analyses and
Determinations
    C. General Comments on EPA's BART FIP Analyses and
Determinations
    D. Source-Specific Comments on EPA's BART Analyses and
Determinations
    E. Comments on Enforceability Requirements in EPA's BART FIP
    F. Comments on Legal Issues
    G. Other Comments
V. Summary of Final Action
VI. Statutory and Executive Order Reviews

I. Background

A. Summary of Our Proposed Action

    Our notice of proposed rulemaking (NPRM) was signed on July 2,
2012, and was published in the Federal Register on July 20, 2012.\2\ In
that notice, we proposed to approve in part and disapprove in part a
portion of Arizona's Regional Haze SIP (submitted on February 28, 2011)
and proposed a FIP to address the deficiencies in the disapproved
portions of the SIP. The proposed rule addressed the BART requirements
for eight units at three electric generating stations: Arizona Electric
Power Company's (AEPCO) Apache Generating Station (Apache) Units 1, 2
and 3; Arizona Public Service's (APS) Cholla Power Plant (Cholla) Units
2, 3 and 4; and Salt River Project's (SRP) Coronado Generating Station
(Coronado) Units 1 and 2. We did not propose action on any other part
of Arizona's SIP related to the remaining requirements of the Regional
Haze Rule (RHR). In summary, we proposed the following:
---------------------------------------------------------------------------

    \2\ 77 FR 42834.
---------------------------------------------------------------------------

    Proposed Approval: We proposed to approve Arizona's determination
that the following sources and units are subject to BART: Apache Units
1, 2 and 3; Cholla Units 2, 3 and 4; and Coronado Units 1 and 2
(collectively ``BART units''). We proposed to approve Arizona's BART
emissions limits for SO2 and PM10 at all three
sources and units and the emissions limit for NOX at Apache
Unit 1.
    Proposed Disapproval: We proposed to disapprove Arizona's BART
emissions limits for NOX at all of the coal-fired BART units
(i.e., all of the BART units except for Apache Unit 1). We also
proposed to disapprove the compliance schedules and requirements for
equipment maintenance and operation, including monitoring,
recordkeeping and reporting requirements for BART at all of the BART
units, since these were not included in the SIP submittal.
    Proposed FIP: The proposed FIP contained BART emissions limits for
NOX at all of the coal-fired BART units, as well as
compliance deadlines and requirements for equipment maintenance and
operation, including monitoring, recordkeeping and reporting, to ensure
the enforceability of the BART limits for all of the BART units.
Because our proposed FIP emission limits would likely result in changes
in stack conditions from those anticipated in the SIP, we invited
comment on whether an alternative test method to the one required in
the SIP is acceptable for PM10. In addition, we specifically
sought comment on whether we should require lower SO2
emissions limits or removal efficiency requirements for any of the
coal-fired BART units. Finally, in the regulatory text in our NPRM, we
proposed to incorporate by reference into the FIP two provisions of the
Arizona Administrative Code, R18-2-310 and R18-2-310.01, which we
characterized as establishing an affirmative defense for excess
emissions due to malfunctions.\3\
---------------------------------------------------------------------------

    \3\ Those provisions also include an affirmative defense for
excess emissions due to startups and shutdowns, which we did not
intend to incorporate.
---------------------------------------------------------------------------

B. Legal Basis for Our Final Action

    Our action is based on an evaluation of Arizona's Regional Haze SIP
submitted on February 28, 2011, to meet the requirements of Section 308
of the RHR. We evaluated the SIP against the requirements of the RHR
and Clean Air Act (CAA) sections 169A and 169B. We also applied the
general SIP requirements in CAA section 110. Our authority for action
on Arizona's Regional Haze SIP is based on CAA section 110(k). Our
authority to promulgate a FIP is based on CAA section 110(c).

II. Overview of Final Action

    EPA is taking final action to approve in part and disapprove in
part a portion of Arizona's SIP for Regional Haze, and to promulgate a
FIP for the disapproved elements of the SIP. This final rule only
addresses the BART requirements for the eight BART units identified
above.

Most notably, and with the exception of Apache Unit 1, the FIP includes
NOX emission limits for all the units that are achievable
with SCR. At this time, EPA is not taking action on the State's other
BART determinations or any other parts of the SIP regarding the
remaining requirements of the RHR.
    EPA takes very seriously a decision to disapprove any state plan.
To approve a state plan, EPA must be able to find that the state plan
is consistent with the requirements of the CAA and EPA's regulations.
Further, EPA's oversight role requires us to ensure fair implementation
of CAA requirements by states across the country, even while
acknowledging that individual decisions from source to source or state
to state may not have identical outcomes. In this instance, for the
reasons described in our proposal and in this document, we find that
the State's NOX BART determinations for the coal-fired units
are not consistent with the applicable statutory and regulatory
requirements. Furthermore, the Arizona Regional Haze SIP does not
include the necessary compliance schedules and requirements for
equipment maintenance and operation, including monitoring,
recordkeeping and reporting requirements for BART. As a result, EPA
believes this final disapproval is the only path that is consistent
with the Act at this time.
    We encourage the State to submit a revised SIP to replace all
portions of our FIP, and are ready to work with the State to develop a
revised plan. The CAA requires states to prevent any future and remedy
any existing man-made impairment of visibility in 156 national parks
and wilderness areas designated as Class I areas. Arizona has a wealth
of such areas. The three power plants affect visibility at 18 national
parks and wilderness areas, including the Grand Canyon, Mesa Verde and
the Petrified Forest. The State and EPA must work together to ensure
that plans are in place to make progress toward natural visibility
conditions at these national treasures.

III. Final BART Determinations

    This section is a summary of EPA's final action on the BART
determinations for the BART units at Apache, Cholla and Coronado
electric generating stations. Please refer to Table 1 that compares
this final rule to the proposal that was published on July 20, 2012.
Where EPA has modified our proposal to respond to comments or
additional information, we explain our analysis in the next section
titled ``EPA's Responses to Comments.'' We have fully considered all
comments on our proposal, and have concluded that some changes are
warranted based on public comments and additional information we
received in response to questions raised in the proposal.
    Final Approval: EPA is approving Arizona's determination that the
following sources and units are subject to BART: Apache Units 1, 2 and
3; Cholla Units 2, 3 and 4; and Coronado Units 1 and 2 (collectively
``BART units''). We are approving the emissions limits for
NOX, PM10 and SO2 at Apache Unit 1 as
proposed. We are approving the State's emissions limits for
PM10 and SO2 for all the units.
    Final Disapproval: Based on our evaluation described in the
proposal and in this document, we are disapproving the State's BART
emissions limits for NOX at all the BART units except for
Apache Unit 1, for which the SIP's BART determination consists of fuel
switching to pipeline natural gas (PNG). We also are disapproving the
compliance schedules and requirements for equipment maintenance and
operation, including monitoring, recordkeeping and reporting
requirements for BART at all the BART units since these were not
included in the Arizona Regional Haze SIP.\4\
---------------------------------------------------------------------------

    \4\ For each BART source, the SIP must include a requirement to
install and operate control equipment as expeditiously as
practicable (40 CFR 51.308(e)(1)(iv)); a requirement to maintain
control equipment (40 CFR 51.308(e)(1)(v)); and procedures to ensure
control equipment is properly operated and maintained, including
requirements for monitoring, recordkeeping and reporting (40 CFR
51.308(e)(1)(v)).
---------------------------------------------------------------------------

    Final Federal Implementation Plan: We are promulgating a FIP that
includes emissions limitations representing BART for NOX at
all the coal-fired BART units. The FIP also includes compliance
schedules and requirements for equipment maintenance, monitoring,
testing, recordkeeping and reporting for all the BART units. For
PM10 at all units, we allow the use of Method 5 as an
alternative to Method 201A/202. In addition, the FIP includes a removal
efficiency requirement for SO2 on Cholla Units 2, 3 and 4,
which will ensure that the scrubbers on these units are properly
operated and maintained. Finally, we are incorporating into the FIP an
affirmative defense provision for excess emissions due to
malfunctions.\5\
---------------------------------------------------------------------------

    \5\ In the regulatory text in our NPRM, we proposed to
incorporate by reference into the FIP two provisions of the Arizona
Administrative Code, R18-2-310 and R18-2-310.01, which we
characterized as establishing an affirmative defense for excess
emissions due to malfunctions. However, those provisions also
include an affirmative defense for excess emissions due to startups
and shutdowns, which we did not intend to incorporate. As explained
below, the emission limits that we are promulgating today include an
adequate margin of compliance to account for periods of startup and
shutdown. Accordingly, as indicated by the title of this provision
in our proposed regulatory text (``Affirmative Defense for
Malfunctions''), we are only incorporating into the FIP the
malfunction-related provisions of these rules and not the startup
and shutdown provisions. Our final regulatory text clarifies this
distinction and also incorporates the definition of malfunction.
---------------------------------------------------------------------------

    We have revised certain elements of our proposed FIP based on
public comments and additional information as follows:
     Apache Units 2 and 3: The final emissions limit for
NOX is 0.070 pounds per million British thermal units (lb/
MMBtu) determined as an average of the two units, based on a rolling
30-boiler-operating-day average. Compared to the proposed emissions
limit of 0.050 lb/MMBtu on each unit, this higher limit and the
addition of a two-unit average provides an extra margin of compliance
to account for periods of startup and shutdown as well as additional
operational flexibility for Apache given AEPCO's status as a small
entity. When either one of the two units is not operating, its
emissions from its own preceding thirty boiler-operating-days will
continue to be included in the two-unit average. The final compliance
date for this NOX limit remains five years from the date of
publication of this final rule. For SO2 and PM10
we are extending the compliance deadline to four years from publication
of this final rule in order to provide AEPCO with sufficient time to
implement upgrades to the existing scrubbers and electrostatic
precipitators (ESPs) at these units.
     Cholla Units 2, 3 and 4: The final emissions limit for
NOX is 0.055 lb/MMBtu determined as an average of the three
units, based on a rolling 30-boiler-operating-day average. Compared to
the proposed emissions limit of 0.050 lb/MMBtu on each unit, the higher
limit and three-unit average provide an extra margin of compliance to
account for periods of startup and shutdown. When any of the three
units is not operating, its emissions from its own preceding thirty
boiler-operating-days will continue to be included in the three-unit
average. As proposed, the final compliance date to install and operate
controls is five years from the date of publication of this final rule.
For SO2, we are adding a removal efficiency requirement of
95 percent for the scrubbers on Cholla Units 2, 3 and 4, in order to
ensure that these scrubbers are properly operated and maintained,
consistent with 40 CFR 51.308(e)(1)(v). We are retaining the other
compliance deadlines as proposed, except for Cholla Unit 2, where we
are extending the

compliance deadline to April 1, 2016, for both SO2 and
PM10 in order to provide APS with sufficient time to install
a new wet flue gas desulfurization (FGD) system and fabric filter on
this unit.
     Coronado Units 1 and 2: The final emissions limit for
NOX is 0.065 lb/MMBtu determined as an average of the two
units, based on a rolling 30-boiler-operating-day average. Compared to
the proposed emissions limits of 0.050 on Unit 1 and 0.080 on Unit 2,
this new limit based on a two-unit average provides an extra margin of
compliance to account for startup and shutdown. When either one of the
two units is not operating, its emissions from its own preceding thirty
boiler-operating-days will continue to be included in the two-unit
average. The final compliance date for the two units is five years from
the date of publication of this final rule.

                Table 1--Summary of Changes From Proposal to Final Rule: Emissions Limits (Lb/MMBtu) and Compliance Dates in SIP and FIP
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                   NOX                                        PM10                                    SO2
            Source             -------------------------------------------------------------------------------------------------------------------------
                                     Proposal               Final               Proposal               Final              Proposal            Final
--------------------------------------------------------------------------------------------------------------------------------------------------------
Apache Unit 1.................  0.056, Five years  0.056, Five years       0.0075, 180 days.  0.0075, 180 days        0.00064, 180      0.00064, 180
                                                                                days.             days.
Apache Unit 2.................  0.050, Five years  0.070 (across two       0.03, 180 days...  0.03, Four years        0.15, 180 days..  0.15, Four
                                                    units)                                                                               years.
Apache Unit 3.................  0.050, Five years  Five years              0.03, 180 days...  0.03, Four years        0.15, 180 days..  0.15, Four
                                                                                years.
Cholla Unit 2.................  0.050, Five years  0.055 (across three     0.015, Jan 1,      0.015, Apr 1, 2016      0.15, 180 days..  Add 95 percent
                                                    units)                  2015.                                                        efficiency Apr
                                                                                1, 2016.
Cholla Unit 3.................  0.050, Five years  Five years              0.015, 180 days..  0.015, 180 days         0.15, 180 days..  Add 95 percent
                                                                                efficiency 1
                                                                                year.
Cholla Unit 4.................  0.050, Five years                          0.015, 180 days..  0.015, 180 days         0.15, 180 days..  Add 95 percent
                                                                                efficiency 1
                                                                                year.
Coronado Unit 1...............  0.050, Five years  0.065 (across two       0.03, 180 days...  0.03, 180 days          0.08, 180 days..  0.08, 180 days.
                                                    units)
Coronado Unit 2...............  0.080, June 1,     Five years              0.03, 180 days...  0.03, 180 days          0.08, 180 days..  0.08, 180 days.
                                 2014.
--------------------------------------------------------------------------------------------------------------------------------------------------------

IV. EPA's Responses to Comments

    We are responding to comments on our proposed rule published on
July 20, 2012.\6\ We held an initial public hearing in Phoenix,
Arizona, on July 31, 2012. In response to concerns that more time was
needed to analyze the proposal and develop comments, we added two
additional public hearings in Holbrook and in Benson, Arizona, on
August 14 and 15, respectively, and extended the public comment
deadline to September 18, 2012.\7\ The three public hearings were
attended by hundreds of citizens, local and state government officials,
workers and officials from the power plants, and representatives from
environmental organizations. Testimony and comments from the three
public hearings are organized in the docket by location and available
for viewing at www.epa.gov/region9/air/actions/arizona.html and http://www.regulations.gov.
---------------------------------------------------------------------------

    \6\ 77 FR 42834.
    \7\ 77 FR 45326 (July 31, 2012).
---------------------------------------------------------------------------

    We also received a number of written comments, including extensive
comments from stakeholders and government agencies who offered policy
and technical analyses addressing the details of our proposed rule.
These stakeholders included AEPCO, APS, SRP, PacifiCorp, Arizona
Utilities Group (AUG), National Park Service (NPS), Arizona Department
of Environmental Quality (ADEQ), and a consortium of conservation
organizations (National Parks Conservation Association, Sierra Club,
Physicians for Social Responsibility--Arizona Chapter, Dine' Citizens
Against Ruining Our Environment, Grand Canyon Trust, and San Juan
Citizens Alliance) represented by Earthjustice. All of the comments we
received along with attached technical reports and analyses are
available for review in the docket.

A. General Comments on ADEQ's Approach to BART

1. ADEQ's Identification of BART Sources
    Comment: One commenter (Earthjustice) stated that EPA must provide
further factual support for its determination that Cholla Unit 1 is not
BART-eligible. The commenter indicated that the record lacks the
requisite support for this conclusion. Recounting the history of ADEQ's
finding that Unit 1 is not BART-eligible, the commenter noted that APS
claimed, and ADEQ concurred, that Unit 1 is not BART-eligible based on
a 50-year-old document entitled ``Operating Notes For May 1962'' which
allegedly shows that Unit 1 began operations on May 1, 1962, and was
thus placed into operation just months before the August 7, 1962, BART-
eligibility cut-off. The commenter added that EPA apparently approved,
without any scrutiny, ADEQ's determination that Cholla Unit 1 is not
BART-eligible.
    The commenter (Earthjustice) requested that EPA properly analyze
the BART-eligibility of Cholla Unit 1. Specifically, the commenter
requested that EPA identify which ``aspects of the process by which
ADEQ identified its eligible-for-BART and subject-to-BART sources'' it
disagrees with, the basis of each disagreement, and whether any such
disagreement implicates Cholla Unit 1. In addition, the commenter
stated that EPA's independent analysis of this issue must be supported
by the following information, which is needed to verify the actual date
that Cholla Unit 1 began operating:
     The document entitled ``Operating Notes for May 1962''
referenced in ADEQ's SIP;
     All available 1962 operating records for Cholla Unit 1;
     All initial CAA construction and operating permits issued
to Cholla Unit 1;
     All emissions data from the year 1962 for Cholla Unit 1;
     Notes of the meeting between ADEQ and APS in August 2007
or any other time ADEQ and APS discussed the BART-eligibility of Cholla
Unit 1; and
     Any other documentation that either supports or
contradicts whether Cholla Unit 1 was placed into

commercial operation before August 7, 1962.
    Response: We did not specifically propose to take action on ADEQ's
determination that Cholla Unit 1 is not BART-eligible and our statement
that ``we do not agree with all aspects of the process by which ADEQ
identified its eligible-for-BART and subject-to-BART sources'' was not
intended to apply to this unit. Nonetheless, we agree with the
commenter that it is appropriate to give some consideration to this
issue in the context of today's rulemaking action, which covers ADEQ's
BART determinations for the other three units at Cholla.
    Contrary to the commenter's assertion, the WRAP did not find Cholla
Unit 1 subject to BART. The WRAP document cited by the commenter merely
indicates that ADEQ notified APS on July 13, 2007 that Cholla Units 1-4
were ``Potentially Subject to BART.'' \8\ The WRAP's ``Arizona BART
Eligibility TSD'' further explains that:
---------------------------------------------------------------------------

    \8\ Exhibit 17 to Earthjustice Comments, WRAP BART Clearinghouse
(Oct. 24, 2008).

    [Cholla] Unit 1 is listed as potentially date eligible as
information shows that the emissions unit was in service only 2
months prior to the cut-off date. Recommend requesting additional
supporting documentation for final determination.\9\
---------------------------------------------------------------------------

    \9\ ``Supporting Documentation on Emissions Unit Bart
Eligibility Analysis'', section 5.1.2.

ADEQ received this additional documentation from APS in August 2007 in
the form of a document dated May 23, 1962, and entitled ``Operating
Notes For May 1962.'' \10\ This document indicates that, ``[o]n
Tuesday, May 1, 1962, unit [1 was] placed into commercial
operation.'' \11\ After reviewing this documentation, ADEQ concurred
that Unit 1 was not BART eligible.\12\
---------------------------------------------------------------------------

    \10\ Arizona Regional Haze SIP at page 155.
    \11\ Id.
    \12\ Id.
---------------------------------------------------------------------------

    Following the close of the public comment period, we requested and
received from APS a copy of the ``Operating Notes For May 1962'' along
with additional information concerning the operation of Cholla Unit
1.\13\ We have placed these materials in the docket and, based on our
initial review, we believe this documentation is sufficient to confirm
ADEQ's determination that this unit is not BART-eligible. However,
because this question was not addressed in our proposed rulemaking, we
are not taking final action on it at this time. We intend to address
Cholla Unit 1's BART eligibility when we take action on the remainder
of the Arizona Regional Haze SIP.
---------------------------------------------------------------------------

    \13\ Email from Sue Kidd, APS, to Colleen McKaughan, EPA
(October 10, 2012, 9:17 a.m.) and attachments.
---------------------------------------------------------------------------

 2. ADEQ's BART Control Analyses
    Comment: One commenter (PacifiCorp) states that EPA improperly
focuses on only two factors, costs and visibility improvement, in
rejecting the ADEQ's entire NOX BART determination. The
commenter states that EPA inappropriately places more weight on these
factors.
    Response: EPA disagrees with the comment that we inappropriately
focused on costs and visibility improvement in our decision to
disapprove ADEQ's NOX BART determinations. As outlined in
our proposal, we considered ADEQ's evaluation of the energy and non-air
quality environmental impacts of compliance of the control
technologies, any existing pollution control technology in use at each
of the sources, and the remaining useful life of each source, to be
generally reasonable and consistent with the RHR and the BART
Guidelines.\14\ However, we also found that the costs of control were
not calculated in accordance with the BART Guidelines, and that the
visibility impacts were not appropriately evaluated and considered.
These findings formed part of the basis for our disapproval of ADEQ's
NOX BART determinations.
---------------------------------------------------------------------------

    \14\ See 77 FR 42841.
---------------------------------------------------------------------------

    Comment: Several commenters objected to EPA's use of non-specific
and undefined parameter levels for both the ``cost-effectiveness'' and
``sufficient visibility improvement'' parameters in rejecting ADEQ's
SIP. One commenter (Pacificorp) further noted that states cannot meet
EPA's specific targets unless and until those targets are clearly
defined.
    Response: The RHR and the BART Guidelines do not require the
development of specific thresholds, but rather require evaluation of
each BART determination on a case-by-case basis for each source.\15\ We
have not established a specific cost threshold that makes a particular
control option BART based on just a dollars per ton number, and there
is not a specific target, either in terms of cost-effectiveness or
visibility improvement, for ADEQ to meet. All five factors must be
evaluated and weighed to determine the level of control that is BART on
a case-by-case basis.
---------------------------------------------------------------------------

    \15\ See, e.g., BART Guidelines, 40 CFR Part 51, Appendix Y,
section IV.D.5 (``a 0.3 deciview improvement may merit a stronger
weighting in one case versus another, so one ``bright line'' may not
be appropriate.'')
---------------------------------------------------------------------------

a. ADEQ's Approach to Costs of Compliance
    Comment: One commenter (NPS) agreed with EPA's conclusions that the
costs of control were not calculated by ADEQ in accordance with the
BART Guidelines and that costs were included for items not allowed by
EPA Control Cost Manual (CCM or the Manual) (e.g., owner's costs,
surcharge, escalation, and Allowance for Funds Utilized During
Construction--AFUDC), which inflates the total cost of compliance and
the cost per ton of pollutant reduced. According to the commenter, a
review of industry data (detailed in Appendix A of the commenter's
submission) indicates that the total capital investment (TCI) for SCR
retrofits is typically about $200/kW, while the TCI estimates for
Apache and Cholla equaled or exceeded $250/kW.
    The commenter (NPS) noted that the BART Guidelines recommend use of
the Manual if vendor data are not available. The commenter conducted
detailed cost analyses of SCR using an approach that the commenter
believes is similar to that used by EPA in its evaluation of SCR on the
Colstrip power plant--using the cost methodologies of the Manual and
relying on EPA's Integrated Planning Model (IPM) to reflect the most
recent cost levels. The commenter observed that most of the ADEQ SCR
cost estimates were based on TCI costs that were relatively high ratios
of the reported direct capital costs (DCC). The commenter indicated
that according to the Manual, the ratio of TCI to DCC is 141 percent,
while ADEQ's estimates were as follows:
     At Apache, TCI is 179 percent of DCC for both units and
included $6 million in costs for each unit not typically allowed by
EPA.
     At Cholla, TCI is 258 percent of DCC for all three units
and included $11 million in costs for Units 2 and 3 (each) and $15
million for Unit 4 that are not typically allowed by EPA.
     At Coronado, data were not sufficient to calculate these
values.

The commenter asserted that this supports EPA's concern that control
costs submitted by the utilities either included costs not typically
allowed by EPA or were inadequately documented.
    Response: We appreciate the information provided by the National
Park Service and are in agreement that ADEQ's cost estimates of SCR are
overestimated. As indicated in our proposal, our cost estimates for SCR
generally produced lower values than those in the Arizona Regional Haze
SIP,

and at a level that we consider cost-effective. Although we recognize
that NPS's estimates produce even lower values than those from our
proposal, we have not updated our own cost estimates to reflect NPS's
comments since we already consider SCR to be cost-effective. We do note
that in order to address the comments from the utilities, we have
performed supplemental cost analyses for each facility based on the
costs provided by the utilities, and in doing so have accounted for
those costs not allowed by CCM methodology.
    Comment: Two commenters (ADEQ and AUG) stated that EPA did not and
cannot show that ADEQ failed to consider relevant cost information in
making its BART determination, the State fully complied with its CAA
obligations, and EPA's rationale is insufficient to reject ADEQ's cost
determinations. AUG asserted that:

    Arizona has expressly stated that it has considered each of the
BART factors. EPA plainly cannot--and does not--demonstrate that
Arizona failed to take the costs of compliance with BART emission
limits into consideration. The state is required to do no more than
that, and EPA cannot lawfully disapprove the state's determinations
on the basis that the Agency would prefer a different form of, or
format for, explanation of those determinations.

The commenters further stated that the other reason EPA rejected ADEQ's
cost determinations is that EPA believed that ADEQ relied on
inadequately documented costs. The commenters contended that there is
nothing in the CAA or BART rules that requires a state to present any
particular level of cost documentation or that limits a state's
discretion in its consideration of the cost factor in making a BART
determination.
    Response: We disagree with this comment. First, while Arizona may
have ``expressly stated'' that it considered each of the BART factors,
it must do more than ``state'' that it considered a BART factor, but
must also provide some type of analysis demonstrating that it
considered the BART factors.\16\ Although ADEQ has presented
information relevant to each of the BART factors, it has not provided
an explanation regarding how this information was used to develop its
BART determinations. Specifically in the case of cost calculations, the
Arizona Regional Haze SIP includes relevant information for multiple
NOX control options, but does not provide evidence that this
information has been analyzed in any way. In the case of Apache and
Coronado, the Arizona Regional Haze SIP does not analyze this cost
information in even a qualitative manner. In the case of Cholla, the
terms ``least expensive'' and ``most expensive'' are used, but only in
the context of providing a reference for visibility impacts, and not in
the context of an evaluation of costs. This does not constitute
``consideration,'' as it involves little more than ensuring the
presence of cost values, with no judgment, analysis, or interpretation
of their meaning.
---------------------------------------------------------------------------

    \16\ See, e.g., BART Guidelines, 40 CFR Part 51, Appendix Y,
section IV.E.2. (``You should provide a justification for adopting
the technology that you select as the `best' level of control,
including an explanation of the CAA factors that led you to choose
that option over other control levels.'')
---------------------------------------------------------------------------

    Second, we disagree with the commenter's characterization of our
disapproval as based on a ``preference'' for a different format or form
of explanation for ADEQ's BART determinations. As discussed in the
previous paragraph, ADEQ has not discussed its BART determination
rationale, particularly with regard to costs of compliance, in any
format. While ADEQ's RH SIP does include cost information, it provides
no explanation regarding how, or even if, this cost information was
used in arriving at its NOX BART determinations. Although we
agree that the RHR does provide states significant discretion in their
consideration of the BART factors, AUG's comment presupposes that these
costs were considered. The Arizona Regional Haze SIP does not indicate
that they were considered.
    Comment: ADEQ noted that the same principles were used for the
PM10 and SO2 BART evaluations as were used for
the NOX BART evaluation, yet EPA accepted the approach for
only PM10 and SO2.
    Response: We disagree that we accepted ADEQ's approach for
PM10 and SO2. Although we did not disapprove
ADEQ's PM10 and SO2 BART determinations, the
absence of a disapproval of these determinations should not be
construed to represent acceptance of the approach by which they were
developed. We acknowledge that ADEQ took a similar approach in its
analyses for PM10 and SO2 as for NOX,
and that these analyses exhibit the same deficiencies we have noted
elsewhere for the NOX BART determinations. However, we did
not disapprove the PM10 and SO2 determinations
because we find that the shortcomings in these analyses did not result
in unreasonable BART determinations and therefore were generally
``harmless errors.''
    With regard to PM10, we note that ADEQ determined the
most stringent control technology (fabric filters) was BART for each of
the Cholla units. For Apache and Coronado, ADEQ determined that the
current control technology (hot-side ESPs) was BART and eliminated the
most stringent control technology (fabric filters). We note that PM
emissions from EGUs typically contribute only a small percentage of the
modeled visibility impact from EGUs, and that controlling their
emissions results in very small visibility benefit. For example,
CALPUFF visibility modeling performed by WRAP indicates that for
Apache, the maximum baseline PM10 visibility impact at the
most affected Class I area (Chiricahua NM) is 0.04 dv.\17\ Assuming
that a more stringent control technology could achieve 100 percent PM
control and eliminate this entire visibility impact, a more stringent
PM10 BART determination would therefore achieve, at most, a
visibility benefit of 0.04 dv. Although ADEQ did not document its
analysis or weighing of the five factors in arriving at the
PM10 BART determinations for Apache or Coronado, additional
analysis would not have the potential to result in selection of a more
stringent control technology in light of the small potential for
visibility benefit.
---------------------------------------------------------------------------

    \17\ See Docket Item No. B-12, ``Summary of WRAP RMC BART
Modeling for Arizona.''
---------------------------------------------------------------------------

    With regard to SO2, ADEQ selected the most stringent
control technology (wet FGD) for all units at Apache, Cholla, and
Coronado. Although ADEQ did not ``take into account the most stringent
emission control level that the technology is capable of achieving,''
correcting for this flaw would not have the potential to result in the
selection of a more stringent control technology, since wet FGD, which
is the most stringent control technology, was already selected as BART.
Further discussion of our evaluation of ADEQ's BART analyses for
PM10 and SO2 is provided below.
    Comment: The commenters stated that one of EPA's reasons for
rejecting ADEQ's cost determinations is because the costs are
inconsistent with the CCM. The commenters noted that use of the
outdated Manual is not required by the CAA or the BART rules and
provide references in which EPA has stated that the Manual is only one
tool that can be used but that other cost data should also be
considered.
    Response: We partially agree with this comment. We acknowledge that
our BART guidelines state, ``In order to maintain and improve
consistency, cost estimates should be based on the [CCM], where
possible'' and that ``[w]e believe that the [CCM] provides a good

reference tool for cost calculations, but if there are elements or
sources that are not addressed by the Control Cost Manual or there are
additional cost methods that could be used, we believe that these could
serve as useful supplemental information.'' \18\ The Manual contains
two types of information: (1) Study level cost estimates of capital and
operation and maintenance (O&M) costs for certain specific types of
pollution control equipment, such as SCR, and (2) a broader costing
methodology, known as the overnight method. We agree that the language
of the BART Guidelines does not require strict adherence to the study
level equations and cost methods used to estimate capital and O&M
costs.
---------------------------------------------------------------------------

    \18\ BART Guidelines, 40 CFR Part 51, Appendix Y, section
IV.D.4.a.
---------------------------------------------------------------------------

    We consider the use of the broader costing methodology used by the
CCM, the overnight method, as crucial to our ability to assess the
reasonableness of the costs of compliance. Evaluation of the cost of
compliance factor requires an evaluation of the cost-effectiveness
associated with the various control options considered for the
facility. A proper evaluation of cost-effectiveness allows for a
reasoned comparison not only of different control options for a given
facility, but also of the relative costs of controls for similar
facilities. If the cost-effectiveness of a control technology for a
particular facility is outside the range for other similar facilities,
the control technology may be rejected as not cost-effective.\19\ In
order for this type of comparison to be meaningful, the cost estimates
for these facilities must be performed in a consistent manner. Without
an `apples-to-apples' comparison of costs, it is impossible to draw
rational conclusions about the reasonableness of the costs of
compliance for particular control options. Use of the CCM methodology
is intended to allow a fair comparison of pollution control costs
between similar applications for regulatory purposes. This is why the
BART guidelines specify the use of the CCM where possible \20\ and why
it is reasonable for us to insist that the CCM methodology be observed
in the cost estimate process. However, we note that the overnight
method has been used for decades for regulatory control technology cost
analyses, and that its use ensures equitable BART determinations across
states and across sources.
---------------------------------------------------------------------------

    \19\ See Id. section IV.D.4.f (``A reasonable range [of cost-
effectiveness values] would be a range that is consistent with the
range of cost-effectiveness values used in other similar permit
decisions over a period of time.'')
    \20\ BART Guidelines, 40 CFR Part 51, Appendix Y, section
IV.D.4.
---------------------------------------------------------------------------

    Comment: One commenter (SRP) stated that ADEQ appropriately
considered the ``dollars-per-deciview'' cost-effectiveness of different
control options, which is reasonable and entirely within the broad
discretion afforded to the states under the CAA. SRP stated that
because BART is a component of the CAA's visibility program, it is more
crucial to evaluate control costs in relation to the visibility
improvements that may be expected using a dollars per deciview ($/dv)
metric.
    Response: The BART Guidelines require that cost-effectiveness be
calculated in terms of annualized dollars per ton of pollutant removed,
or $/ton, but also list the $/deciview ratio as an additional cost-
effectiveness measure that can be employed along with $/ton for use in
a BART evaluation.\21\ However, the $/dv metric is only useful to the
extent that it reflects appropriately calculated costs and visibility
benefits. As explained elsewhere in this document, we have determined
that ADEQ did not evaluate costs and visibility benefits in a manner
consistent with the RHR and the BART Guidelines. Therefore, while ADEQ
certainly had the discretion to take $/dv into consideration as part of
its BART analyses, the values that it relied upon in doing so were not
reasonable.
---------------------------------------------------------------------------

    \21\ BART Guidelines sections IV.D.4.c and IV.E.
---------------------------------------------------------------------------

b. ADEQ's Approach to Energy and Non-Air Quality Environmental Impacts
    Comment: One commenter (SRP) stated that EPA inappropriately
downplayed the energy and non-air quality factor in its review of
ADEQ's BART analysis. Another commenter (ADEQ) noted that because fly
ash ammonia residues have the potential to contaminate ground and
surface waters, ADEQ included potential environmental impacts and the
economics of disposing the fly ash in its BART analysis.
    Response: We do not agree that we inappropriately downplayed the
energy and non-air quality environmental impacts factor in our review
of ADEQ's BART analyses. ADEQ provided only brief consideration of this
factor in its BART analyses and did not explain how it weighed this
factor against the other statutory factors. Because ADEQ's analysis of
this factor was limited in scope, our evaluation of this factor in
reviewing the SIP was similarly limited. We discuss our analysis of
this factor in our FIP action below.
c. ADEQ's Approach to Degree of Visibility Improvement
    Comment: Several commenters (American Coalition for Clean Coal
Electricity (ACCCE), AEPCO, APS, AUG, Navajo Nation, PacifiCorp, SRP)
asserted that EPA improperly dismissed ADEQ's visibility impacts
analyses. The commenters cited the BART Guidelines (70 FR 39170, July
6, 2005) to assert that there is no prescribed method for states to
consider and weigh visibility impacts and, thus, EPA has no legal
grounds for disapproving a SIP based on the method the State has chosen
to consider visibility impacts or improvements. The commenters added
that whatever EPA's preference, it has no discretion to substitute its
method or its conclusion for those of the State. According to the
commenters, it is clear that the BART rules envision--or, at a minimum,
allow--a visibility improvement analysis that is focused on visibility
impacts in the most impacted area.
    Regarding ADEQ's BART determination at Coronado in particular, one
commenter (SRP) noted that ADEQ evaluated a visibility index derived
from an average of modeled visibility improvements at the nine Class I
areas closest to Coronado. The commenter asserted that this approach
was well within the State's discretion to assess visibility under the
BART rules. Another commenter (AUG) argued this consideration of an
average visibility impacts index is an even more thorough type of
evaluation than that required by the BART rules.
    One commenter (AEPCO) added that EPA's proposal to disapprove
ADEQ's NOX BART determinations was largely based on its
concern with ADEQ's reliance on the Western Regional Air Partnership
(WRAP) modeling.
    By contrast, another commenter asserted that since the facilities'
modeling results indicated that controls would contribute to visibility
improvements in multiple Class I areas, ADEQ should consider these
benefits rather than looking at the benefits in only a single Class I
area. The commenter believes that overlooking significant visibility
benefits in this way considerably understates the overall benefit of
controls to improved visibility. The commenter contended that the
procedure followed by ADEQ is not a sufficient basis for making BART
determinations for sources with substantial benefits across many Class
I areas.
    Response: EPA's proposed disapproval of ADEQ's NOx BART
determinations was not based on any concern with the WRAP modeling

protocol, upon which ADEQ relied for its BART analyses. On the
contrary, we found that the modeling procedures relied upon by ADEQ
were ``in accord with EPA guidance.'' \22\ However, we noted that
ADEQ's use of the results of modeling in making BART decisions was
``problematic in several respects.'' \23\ In other words, our concern
with the visibility analysis was not with the technical adequacy of the
modeling itself, but rather with how ADEQ interpreted the results of
this modeling.
---------------------------------------------------------------------------

    \22\ 77 FR 42841.
    \23\ Id.
---------------------------------------------------------------------------

    In its BART analyses for Apache and Cholla, ADEQ considered
visibility improvements only at the single Class I area with the
greatest modeled impact from a facility. This neglects improvements
that would occur at other nearby Class I areas, and in general is not
adequate for assessing the overall visibility benefit from candidate
BART controls. As noted by commenters, the BART Guidelines provide
that, ``[i]f the highest modeled impacts are observed at the nearest
Class I area, [a State] may choose not to analyze the other Class I
areas any further and additional analyses might be unwarranted.'' \24\
Commenters argued that this language shows that Arizona's exclusive
focus on improvements at a single Class I area is allowed under the
BART Guidelines. However, this language is not intended as an
invitation for states to ignore significant visibility improvements at
multiple Class I areas. Rather, it is intended to provide a way of
streamlining a complex and difficult modeling exercise where ``an
analysis may add a significant resource burden to a State.'' \25\ For
example, when the visibility benefits at the most impacted Class I area
alone are sufficient to justify the selection of the most stringent
control technology as BART, then analysis of additional areas would be
unnecessary and the state could conserve resources by not modeling the
impacts on those additional areas. Here, by contrast, ADEQ did not
perform its own modeling at all, but instead relied on modeling
performed by contractors for the facilities. This modeling indicated
that the installation of more stringent controls (i.e., SNCR or SCR)
would result in visibility benefits at multiple Class I areas, yet ADEQ
chose to consider the benefits only at the most impacted area. Where,
as here, the benefits of controls have been modeled for a number of
surrounding areas and consideration of these benefits is useful in
determining the appropriate level of controls, EPA does not agree that
these benefits may be ignored.\26\
---------------------------------------------------------------------------

    \24\ BART Guidelines, 40 CFR Part 51, Appendix Y, section
IV.D.5.
    \25\ See 70 FR 39126.
    \26\ See, e.g., 76 FR 52388, 52430 (San Juan Generating
Station); 77 FR 51620, 51631-51632 (Four Corners Power Plant); and
77 FR 51915, 51922-51923 (Roseton and Danskammer Generating
Stations).
---------------------------------------------------------------------------

    While there may be no single prescribed method to consider and
weigh visibility impacts, the BART Guidelines do require that certain
visibility impacts be included in the considering and weighing. EPA
disagrees that state flexibility extends to categorically excluding
consideration of visibility improvements occurring at multiple Class I
areas. Considering benefits at multiple areas does not necessarily
require use of the ``cumulative'' improvement approach (i.e., the
direct sum of improvements at all the areas), but does require that
improvements at those areas be taken into account in some way. For
example, one could simply list visibility improvements at the various
areas, and qualitatively weigh the number of areas and the magnitudes
of the improvements. However, ADEQ did not do this for any of the
sources covered by this action.
    With respect to ADEQ's consideration of visibility improvements for
Coronado, EPA agrees that average visibility index used by ADEQ could
be acceptable in itself as part of assessing multiple area impacts and
improvements; indeed it is a variant of the cumulative improvement
approach. However, without any consideration of particular area
improvements, the averaging process causes especially large benefits at
some individual areas to be diluted or lost, effectively discounting
some of the more important effects of the controls. In addition, the
approach is counter to ADEQ's emphasis elsewhere in the SIP on the
importance of considering the visibility improvement at the single area
having the largest impact from a given facility. Finally, ADEQ provided
no discussion of how the results of the visibility index were weighed
against the other BART factors.
    In addition, ADEQ considered visibility improvements from controls
on only a single emitting unit at a time, despite the fact that each of
the three sources has multiple BART-eligible units. This neglects the
full improvement that would result from controls on the facility, with
the potential for dismissing emitting unit benefits that are
individually small, but that collectively could have a significant
visibility benefit. The RHR requires RH SIPs to include a
``determination of BART for each BART-eligible source in the State that
emits any air pollutant which may reasonably be anticipated to cause or
contribute to any impairment of visibility in any mandatory Class I
Federal area.'' \27\ The BART Guidelines explain that, ``[i]f the
emissions from the list of emissions units at a stationary source
exceed a potential to emit of 250 tons per year for any visibility-
impairing pollutant, then that collection of emissions units is a BART-
eligible source.'' \28\ Therefore, it is that collection of units for
which one must make a BART determination. The Guidelines state ``you
must conduct a visibility improvement determination for the source(s)
as part of the BART determination. * * *'' \29\ This requires
consideration of the visibility improvement from BART applied to the
facility as a whole.
---------------------------------------------------------------------------

    \27\ 40 CFR 51.308(e)(1)(ii).
    \28\ 40 CFR Part 51, Appendix Y, section II.A.4.
    \29\ Id. section IV.D.5.
---------------------------------------------------------------------------

    The RHR and the Guidelines do not preclude consideration of
visibility improvement from controls on individual units, but that
would be in addition to considering the improvement from the whole
facility. The BART Guidelines clearly allow for the consideration of
technical feasibility and cost-effectiveness on a unit-by-unit basis
where appropriate, but those considerations fall under different
factors than the assessment of the degree of visibility improvement,
and do not remove the obligation to consider visibility improvement
from BART applied to the facility as a whole. In sum, while the State
has some flexibility in choosing a specific procedure to consider these
cumulative area and multiple unit benefits, when such benefits are
significant, it is not reasonable to ignore them altogether as ADEQ
did.
    Comment: One commenter (NPS) agrees with EPA that the ammonia
background concentration assumed by ADEQ for Cholla and Coronado may be
too low, ranging from 1 part per billion (ppb) down to 0.2 ppb.
According to the commenter, EPA guidance recommends the use of a 1 ppb
ammonia background for areas in the west, absent compelling evidence to
the contrary.
    Other commenters (APS and AUG) state that the Interagency Workgroup
on Air Quality Modeling (IWAQM) recommended value of 1ppb is outdated
and should not be used now that better data have been gathered and
since the CALPUFF model was updated to allow for monthly, rather than
yearly, average ammonia concentrations. APS also noted that EPA Region
9 has explicitly

approved the use of the same monthly-varying background ammonia
concentrations, which were based on actual field measurements, in
running the CALPUFF model for two other sites located close to Cholla
and that were used by ADEQ in its analysis. These values range from 1
ppb during the summertime to 0.2 ppb during cold winter months. EPA has
also stated in response to comments on the Montana regional haze FIP
(77 FR 57864, September 18, 2012) that ``it is preferable to use
ambient ammonia measurements when such data are available rather than
using default background ammonia concentrations.'' Another commenter
(Navajo Nation) agrees that EPA should use actual, recorded data
wherever possible, especially ammonia background values. AUG concludes
that EPA has no basis for rejecting the use of refined background
ammonia concentration values in disapproving the SIP.
    Response: The IWAQM Guidance \30\ is the only guidance available
for choosing ammonia background concentrations. Because of the paucity
of monitoring data and the uncertainty in other ammonia estimation
methods, EPA concludes that it is appropriate to use the default 1 ppb
from the IWAQM Guidance.
---------------------------------------------------------------------------

    \30\ Interagency Workgroup On Air Quality Modeling (IWAQM) Phase
2 Summary Report And Recommendations For Modeling Long Range
Transport Impacts (EPA-454/R-98-019), EPA OAQPS, December 1998,
http://www.epa.gov/scram001/7thconf/calpuff/phase2.pdf.
---------------------------------------------------------------------------

    As stated by the commenter, EPA did originally accept monthly
varying ammonia values of 0.2 to 1.0 ppb for BART analyses performed by
AECOM for APS for the Four Corners Power Plant (FCPP), and by SRP for
the Navajo Generating Station (NGS). However, shortly after that, the
USDA Forest Service brought to EPA's attention ammonia monitored in the
Four Corners area showing concentrations up to 3 ppb, described in a
journal paper \31\ by Mark Sather and others. EPA and the Forest
Service also estimated ammonia concentrations by ``back calculating''
the amount of ammonia needed to form the ammonium nitrate and ammonium
sulfate collected at Arizona and New Mexico sites in the IMPROVE
monitoring network. This yielded concentrations ranging from 0.4 to 1.3
ppb, with winter values considerably higher than the AECOM 0.2 ppb
recommended by the commenter.\32\ Since this method accounts only for
ammonium, and not remaining free gaseous ammonia, the total ammonia
originally available to form visibility-impairing compounds may
actually be higher. Because of uncertainty in the ``back-calculation''
method, and criticism of it, EPA relied on it in the FCPP FIP only as
corroboration for the IWAQM default of 1 ppb.\33\ Nevertheless, it
supports the idea that winter ammonia levels in the Class I areas
affected by emissions from sources in Arizona are likely substantially
higher than 0.2 ppb.
---------------------------------------------------------------------------

    \31\ Mark E. Sather et al., ``Baseline ambient gaseous ammonia
concentrations in the Four Corners area and eastern Oklahoma, USA''.
Journal of Environmental Monitoring, 2008, 10, 1319-1325, DOI:
10.1039/b807984f.
    \32\ See, e.g., Proposed Rule: Source Specific Federal
Implementation Plan for Implementing Best Available Retrofit
Technology for Four Corners Power Plant: Navajo Nation Technical
Support Document, pages 59-61, 65-66, 68-73.
    \33\ Id. at page 68.
---------------------------------------------------------------------------

    EPA agrees with commenters that it would be preferable to use
actual monitoring data to determine background ammonia concentrations.
However, much of the existing data cited by the commenters is from
other states, and so is unlikely to be representative for evaluating
visibility impacts at Arizona's Class I areas. Further, the data
comprises only ammonia itself, and not ammonium; or if it does include
ammonium, that is not cited by the commenters. Visibility-impairing
ammonium sulfate and ammonium nitrate are formed from ammonia,
SO2, and NOX. Therefore the ammonium represents
part of the pool of ammonia that could be available to interact with
the SO2 and NOX from a facility and contribute to
visibility impacts, and should be accounted for in estimating ammonia
background concentrations. In several of the research papers \34\ cited
by commenter APS, the amount of measured ammonium is comparable to and
at times much greater than the amount of ammonia.
---------------------------------------------------------------------------

    \34\ RoMANS--Rocky Mountain Atmospheric Nitrogen & Sulfur Study,
William C. Malm and Jeffrey L. Collett. National Park Service, CSU-
CIRA, Fort Collins, CO. ISSN 0737-5352-84. October 2009. http://www.nature.nps.gov/air/Studies/romans.cfm. Table 3.9 on p.3-38 shows
ammonium comparable to or about half of ammonia, depending on
measurement method. It also shows that the spring time mean and
maximum ammonium are about 0.22 and 0.57 [micro]g/m\3\,
respectively, or 0.38 and 0.78 ppb; and the mean and maximum ammonia
are about 0.38 and 1.0 [micro]g/m\3\ or 0.51 and 1.4 ppb. The sum of
these means and maxima is 0.81 and 2.2 ppb, respectively. Figure
4.26 on p.4-26 shows daily sums of ammonium and ammonia, with values
of 2.5-5 [micro]g/m\3\ or 3.6-7.2 ppb occurring frequently. These
are substantially higher than values cited by the commenters.
``NH3 Monitoring in the Upper Green River Basin,
Wyoming'', by John V. Molenar, H. James Newell, Jeffrey Collett, et
al. Extended Abstract 70, A&WMA Specialty Conference
``Aerosol & Atmospheric Optics: Visual Air Quality and Radiation'',
Moab, Utah, 28 April--2 May 2008, p.3 Figure 1 and p.4 Figure 3 show
ammonium comparable to ammonia in summer and far greater in winter.
``Aerosol Ion Characteristics During the Big Bend Regional Aerosol
and Visibility Observational Study,'' Taehyoung Lee, Sonia M.
Kreidenweis & Jeffrey L. Collett Jr. Journal of the Air & Waste
Management Assoc. vol.54, issue 5, 2004, pages 585-592. DOI:10.1080/
10473289.2004.10470927, Table 1 p. 587 shows ammonium about four
times as high as ammonia.
---------------------------------------------------------------------------

    New ammonia monitoring data were collected by SRP at several sites
between NGS and the two nearest Class I areas, Capitol Reef National
Park and Grand Canyon National Park, from December 2009 through April
2010. The monitoring report,\35\ cited by commenter APS, describes a
surprisingly high spatial variability in ammonia concentrations. The
two monitors in the Cameron area south of NGS (and east-southeast of
the Grand Canyon) showed consistent concentration differences despite
being less than five miles from each other; this may be due to
relatively localized ammonia sources. These sites also showed
consistently lower measurements than the Halls Crossing site, north of
NGS (and southwest of Capitol Reef). The range in concentrations was
comparable to the range seen between the AECOM values at the low end,
and EPA's back-calculated values at the high end. Unfortunately,
because of the variability and its unknown causes, the data collected
did not lead to a clear picture of appropriate and representative
ammonia background concentrations to use with CALPUFF.
---------------------------------------------------------------------------

    \35\ ``Measurements of Ambient Background Ammonia on the
Colorado Plateau and Visibility Modeling Implications'', Salt River
Project, Dr. Ivar Tombach, Consultant, and Robert Paine, AECOM
Environment, September 2010.
---------------------------------------------------------------------------

    In any case, as mentioned above, some nearby monitored data
reported in Sather's paper show considerably higher ammonia than
recommended by some commenters, so it is not clear that values lower
than 1 ppb should be used. EPA concludes that there is not a compelling
case for using ammonia background concentrations other than the 1 ppb
found in the only authoritative guidance document available on this
topic and supported by the FLMs.
    Comment: Two commenters (APS and AUG) noted that the RHR and BART
Guidelines are silent regarding whether visibility improvements should
be modeled on a unit-by-unit basis or a plant-wide basis, and there is
no legal requirement that units be modeled aggregately. Given that
visibility benefits are approximately additive, the commenters contend
that it is unreasonable for EPA to conclude that

ADEQ's BART analyses failed to consider any significant visibility
effect merely because ADEQ modeled the units separately. In addition,
AUG notes that it is necessary to determine the effects of emissions
from units individually so that projected visibility impacts can be
considered in light of costs and other impacts associated with BART-
candidate controls for that particular unit, and modeling units
together could obscure these comparisons.
    Response: Considering the visibility benefits of multiple units
together does not preclude a state from also considering individual
unit benefits, as well as individual unit costs. EPA does not agree
that modeling the units together obscures these other comparisons.
Rather, the benefit of controls for an entire BART-eligible source is a
factor that should be considered along with those other comparisons. In
any case, whether considered unit by unit or all units together,
visibility improvement has no effect on the assessment of cost-
effectiveness as measured by dollars per ton of reductions.

B. Comments on ADEQ's Individual BART Analyses and Determinations

1. ADEQ's BART Analyses and Determinations for Apache Unit 1
    Comment: One commenter (NPS) concurred with ADEQ's and EPA's
proposals for BART at Apache Unit 1.
    Response: We acknowledge NPS's concurrence.
2. ADEQ's BART Analyses and Determinations for Apache Units 2 and 3
a. ADEQ's BART Analysis and Determination for NOX
    Comment: One commenter (Earthjustice) commended EPA's decision to
disapprove ADEQ's NOX BART determination for Apache Units 2
and 3. The commenter stated that EPA correctly concluded that ADEQ's
BART determination for NOX inflated the costs of more-
stringent NOX controls by including costs not allowed by EPA
Cost Control Manual, provided little reasoning about the visibility
benefits of additional NOX controls, and did not weigh the
visibility impacts at all nearby Class I areas. The commenter asserted
that because ADEQ's BART analysis does not comply with the RHR's
requirements, EPA must disapprove ADEQ's BART determinations for Apache
Units 2 and 3.
    Response: We agree that ADEQ's BART analysis for Apache Units 2 and
3 does not comply with the RHR's requirements. As discussed further
below, we performed a supplemental analysis using the version of
AEPCO's cost estimate that adheres to our assumptions regarding costs
that are allowed by the CCM (i.e., capital costs for the installation
of SCR with LNB and OFA of $164.9 million), and we also considered the
fact that AEPCO is a small entity under the Regulatory Flexibility
Act.\36\
---------------------------------------------------------------------------

    \36\ As explained in our proposal, a firm primarily engaged in
the generation, transmission, and/or distribution of electric energy
for sale is small if, including affiliates, the total electric
output for the preceding fiscal year did not exceed 4 million
megawatt hours. 77 FR 42867. AEPCO sold under 3 million megawatt
hours in 2011 and is therefore a small entity.
---------------------------------------------------------------------------

b. ADEQ's BART Analysis and Determination for PM10
    Comment: One commenter (NPS) agreed with ADEQ and EPA that BART for
PM10 at Apache Units 2 and 3 is upgrades to the existing
electrostatic precipitators (ESPs) and a PM10 emissions
limit of 0.03 lb/MMBtu. The commenter noted that ADEQ stated that
PM10 emissions would be measured by conducting EPA Method
201/202 tests.
    In contrast, a second commenter (Earthjustice) disagreed with EPA's
proposal to approve ADEQ's PM10 BART determination for
Apache Units 2 and 3. The commenter contended that EPA proposed to
approve the BART determination despite acknowledging that ADEQ did not
conduct a full BART analysis for PM10 because it
overestimated costs and failed to consider upgrades to the existing
ESPs. However, the commenter believes that lower emission rates are
achievable and, as a result, that EPA should disapprove ADEQ's BART
determination, conduct a full five-factor BART analysis and set a lower
emission limit as BART for PM10. According to the commenter,
the Sahu report demonstrates that nearly 150 EGUs across the nation
with a variety of PM controls achieve emission rates lower than 0.03
lb/MMBtu. The commenter asserted that neither ADEQ nor EPA provided any
explanation why Apache Units 2 and 3 could not similarly meet a lower
emission limit.
    Response: As we noted in our proposal, ADEQ's BART analysis did not
demonstrate that all potential upgrades to the existing ESPs at Apache
Units 2 and 3 were fully evaluated or that the costs were calculated in
compliance with the Control Cost Manual. However, we concluded that
this was a harmless error because of the relatively small visibility
improvement associated with PM10 reductions from these
units.\37\ Therefore, we proposed to approve ADEQ's determination that
BART for PM10 at Apache Units 2 and 3 is upgrades to the
existing ESPs and a PM10 emissions limit of 0.03 lb/MMBtu.
---------------------------------------------------------------------------

    \37\ 77 FR 42847.
---------------------------------------------------------------------------

    One commenter asserted that this limit is too lenient, since other
coal-fired units are achieving lower limits, based on test data
submitted by various utilities to EPA as part of an Information
Collection Request (ICR) for the Mercury and Air Toxics (MATS)
Rule.\38\ EPA disagrees with this comment. The MATS Rule establishes an
emission standard of 0.030 lb/MMBtu filterable PM (as a surrogate for
toxic non-mercury metals) as representing Maximum Achievable Control
Technology (MACT) for coal-fired EGUs.\39\ This standard derives from
the average emission limitation achieved by the best performing 12
percent of existing coal-fired EGUs (taking into account the
variability in the testing results for these facilities), based upon to
the same test data referred to by the commenter.\40\ The BART
Guidelines provide that, ``unless there are new technologies subsequent
to the MACT standards which would lead to cost-effective increases in
the level of control, you may rely on the MACT standards for purposes
of BART.'' \41\ Therefore, we are approving ADEQ's determination that a
PM10 limit of 0.03 lb/MMBtu represents BART for these units.
---------------------------------------------------------------------------

    \38\ Information Collection Request For National Emission
Standards For Hazardous Air Pollutants (NESHAP) for Coal- And Oil-
Fired Electric Utility Steam Generating Units (OMB Control No.
2060[hyphen]0631). See http://www.epa.gov/ttn/atw/utility/utilitypg.html for detailed information obtained through this ICR.
    \39\ 77 FR 9304, 9450, 9458 (February 16, 2012) (codified at 40
CFR 60.42Da(a), 60.50Da(b)(1)).
    \40\ See Memorandum from Jeffrey Cole (RTI International) to
Bill Maxwell (EPA) regarding ``National Emission Standards for
Hazardous Air Pollutants (NESHAP) Maximum Achievable Control
Technology (MACT) Floor Analysis for Coal- and Oil-fired Electric
Utility Steam Generating Units for Final Rule'' (Dec. 16, 2011).
    \41\ 40 CFR Part 51, Appendix Y, Section IV.C.
---------------------------------------------------------------------------

c. ADEQ's BART Analysis and Determination for SO2
    Comment: One commenter (Earthjustice) disagreed with EPA's proposal
to approve ADEQ's SO2 BART determination at Apache Units 2
and 3. The commenter states the approval is contrary to the RHR because
ADEQ's BART determination is not supported by a valid five-factor
analysis. The commenter states that EPA cannot speculate that it would
reach the same conclusion as ADEQ, and it must undertake an independent
full five-

factor BART analysis. The commenter argues that an SO2 limit
of 0.04 lb/MMBtu is achievable and cost-effective for Apache Units 2
and 3 according to the Sahu report. The commenter further asserts that,
based on this report, scrubber upgrades can achieve SO2
removal efficiencies of 98 percent and should have been investigated.
    Another commenter (NPS) noted that that AEPCO's BART reports
indicate that uncontrolled SO2 emissions are 0.69 lb/MMBtu,
and that the ADEQ BART proposal would reduce SO2 emissions
by 78 percent down to 0.15 lb/MMBtu. Based on the SO2
control data submitted by the commenter, the commenter asserted that
other BART upgrades are achieving higher removal efficiencies and/or
lower SO2 limits. The commenter believes that the existing
scrubbers can be upgraded to achieve better removal efficiency and
lower emission rates than the 78 percent and 0.15 lb/MMBtu proposed by
EPA. The commenter cited various examples of upgraded scrubbers
achieving limits of less than 0.15 lb/MMBtu or removal rates of greater
than 90 percent.
    By contrast, ADEQ and AEPCO expressed opposition to both a lower
limit and a removal efficiency requirement. ADEQ asserted that ``the
limits included in the state SIP submittal are acceptable as BART'' and
``imposing dual-limitations will be unnecessary and burdensome for the
facility.'' AEPCO commented that ADEQ permit conditions, which require
SO2 absorption systems to be operated and maintained at all
times in a manner consistent with good air pollution control practices
for minimizing emissions, is sufficient, and an additional control
efficiency limit is not necessary. An efficiency limit would also
require modification to the monitors to include the capability to
measure scrubber inlet SO2 in addition to stack emissions,
which would require additional capital and O&M expenditures.
    Response: We proposed to approve ADEQ's determination that BART for
SO2 at Apache Units 2 and 3 is upgrades to the existing
scrubbers with an associated emission limit of 0.15 lb/MMBtu (30-day
rolling average). However, we also solicited comment on whether an
efficiency requirement should be part of the BART requirement, since
Apache has the ability to use coal from various sources that have
varying sulfur content. After reviewing the comments received on our
proposal, we have concluded that the emission limit set by ADEQ
appropriately reflects BART for SO2 at these units and that
a removal efficiency requirement would not be appropriate for these
units.
    While new wet scrubbers are capable of achieving 95 percent or
better removal of SO2,\42\ the Apache scrubbers were
manufactured in the 1970s and designed to meet a limit of 0.8 lb/MMBtu
(i.e., a control efficiency of up to 70 percent).\43\ For such existing
scrubbers achieving greater than 50 percent control, the BART
Guidelines (which are not mandatory for these units) do not provide a
presumptive limit or removal efficiency, but recommend consideration of
cost-effective scrubber upgrades designed to improve the system's
overall SO2 removal efficiency.\44\ In August 2009, AEPCO
provided information to ADEQ concerning potential scrubber upgrades at
Apache Units 2 and 3.\45\ AEPCO noted that it was in the process of
upgrading its limestone grinding system and described other potential
upgrades, such as improving operation of the scrubber bypass damper
system, upgrading the mist eliminator wash system, adding another sieve
tray, and modifying the flue gas inlet. The enclosed ``Wet FGD
Implementation Plan'' indicated that AEPCO intended to proceed with
upgrading the limestone grinding system, improving operation of the
scrubber bypass damper system, and upgrading the mist eliminator wash
system, but that ``[t]he remaining wet FGD options were not selected on
the basis of low probability of successfully making a significant
difference in scrubber performance and/or high cost.'' \46\
---------------------------------------------------------------------------

    \42\ See BART Guidelines, 40 CFR Part 51, Appendix Y, section
IV.E.4.
    \43\ See Apache Title V Permit Technical Support Document
(2007), Table 9; Title V Permit (2007), Attachment B, section
II.E.1.a.
    \44\ See BART Guidelines, 40 CFR Part 51, Appendix Y, section
IV.E.4.
    \45\ Letter from Michelle Freeark, AEPCO, to Trevor Baggiore,
ADEQ (July 8, 2009).
    \46\ Id.
---------------------------------------------------------------------------

    Based on this information, we conclude that no further cost-
effective scrubber upgrades are likely to be feasible for this facility
and we are therefore deferring to ADEQ's determination that 0.15 lb/
MMBtu represents BART for these units. Given the age of these
scrubbers, we find that an additional removal efficiency requirement
would be unnecessarily burdensome. This approach is consistent with our
consideration of AEPCO's status as a small entity in our FIP
determination. We note that our final FIP includes a requirement to
maintain and operate air pollution control equipment at all units in
``a manner consistent with good air pollution control practices for
minimizing emissions'' at all times. We expect that this requirement
will help to ensure that the scrubbers on Apache Units 2 and 3 are
properly maintained and operated under all conditions.
3. ADEQ's BART Analyses and Determinations for Cholla Units 2, 3 and 4
    Comment: One commenter (APS) remarked that EPA stated that APS's
contractor did not provide supporting information for its capital cost
estimate, such as detailed equipment lists. The commenter argues that
detailed equipment lists are typically not necessary for the level of
accuracy needed for the process selection phase of a project and noted
that its contractor used vendor quotes for the major pieces of
equipment and factors for construction, balance of plant, electrical,
owner's costs, surcharges, AFUDC and contingency.
    Response: We do not agree with this comment. The BART Guidelines
provide that:

    You should include documentation for any additional information
you used for the cost calculations, including any information
supplied by vendors that affects your assumptions regarding
purchased equipment costs, equipment life, replacement of major
components, and any other element of the calculation that differs
from the [CCM].\47\

    \47\ 40 CFR Part 51, Appendix Y, section IV.4.a., note 15.

Thus, detailed cost documentation is necessary to the extent that cost
assumptions differ from the CCM. In this case, several of ADEQ's and
APS's cost assumptions for control costs at Cholla differed from the
CCM, but no such documentation was provided as part of the Arizona
Regional Haze SIP.
a. BART Analysis and Determination for NOX
    Comment: One commenter (Earthjustice) commended EPA's decision to
disapprove ADEQ's NOX BART determination for Cholla Units 2,
3 and 4. The commenter stated that EPA correctly concluded that ADEQ's
BART determination for NOX inflated the costs of more-
stringent NOX controls by including costs not allowed by the
Manual, and substantially underestimated the visibility benefits of
additional NOX controls. The commenter asserted that because
ADEQ's BART analysis does not comply with the RHR's requirements, EPA
must disapprove ADEQ's BART determinations for Cholla Units 2, 3 and 4.

    Response: As explained in our proposal and elsewhere in this
document, we agree that ADEQ's BART analyses and determinations for
NOX at Cholla Units 2, 3 and 4 do not comply with the
requirements of the CAA and RHR. We are therefore disapproving these
determinations.
b. BART Analysis and Determination for PM10
    Comment: One commenter (NPS) agreed with EPA's proposal to approve
ADEQ's BART determination for Cholla Units 2, 3 and 4 of an emission
limit of 0.015 lb/MMBtu for PM10 based on the use of fabric
filters, the most stringent control technology available. In contrast,
a second commenter (Earthjustice) disagreed with EPA's proposal to
approve ADEQ's PM BART determination for Cholla Units 2, 3 and 4. The
commenter contended that EPA proposed to approve the BART determination
despite acknowledging that ADEQ did not conduct a full BART analysis
for PM because fabric filters are the most stringent PM control
technology available and ADEQ's 0.015 lb/MMBtu emission limit is
``consistent'' with other EGUs employing fabric filters (citing 77 FR
42849). However, the commenter believes that lower emission rates are
achievable with fabric filters and, as a result, that EPA should
disapprove ADEQ's BART determination, conduct a full five-factor BART
analysis and set a lower emission limit as BART for PM10.
According to the commenter, the BART Guidelines' exemption from a full
five-factor analysis for the most stringent control technology is not
applicable in this case because improvements to the fabric filters are
possible and a lower emission rate is thus achievable.
    The latter commenter (Earthjustice) stated that had EPA conducted
the PM10 BART analysis required by the RHR, it would show
that an emission rate lower than 0.015 lb/MMBtu is BART for Cholla.
According to the commenter, an expert report accompanying the
commenter's submission (the ``Sahu report'') demonstrates that upgrades
to the fabric filters can achieve a lower emission limit and, moreover,
that nearly 100 EGUs across the nation with a variety of PM controls
achieve emission rates lower than 0.015 lb/MMBtu. The commenter
asserted that neither ADEQ nor EPA provided any explanation why Cholla
Units 2, 3 and 4 could not similarly meet a lower emission limit.
    Response: We are finalizing our approval of ADEQ's PM10
BART determination at Cholla Units 2, 3 and 4. We find that an emission
limit of 0.015 lb/MMBtu represents what can be continuously achieved
with a properly operated baghouse on these units. The fabric filters
(i.e., baghouses) at Cholla will all be new since they are scheduled to
be installed between 2008 and 2016. Recent PSD BACT limits for coal-
fired EGUs with new baghouses have typically ranged from 0.01 to 0.015
lb/MMBtu using Method 5.
    As to the commenter's position that bag material selection would
influence the level of PM that could be achieved, EPA notes that there
are a number of factors that influence a utility's selection of proper
bag material such as bag life, compatibility with exhaust gas stream
and control of other pollutants such as mercury (Hg) or sulfuric acid
mist (H2SO4). In addition, it should be noted
that the latest revision to the EGU NSPS requires modified units to
meet a PM limit of 0.015 lb/MMBtu.\48\ Also, as noted above, the recent
EGU MATS rule sets a PM emissions standard of 0.03 lb/MMBtu, and the
BART Guidelines provide that, ``unless there are new technologies
subsequent to the MACT standards which would lead to cost-effective
increases in the level of control, you may rely on the MACT standards
for purposes of BART.'' \49\ Therefore, we are finalizing our proposed
approval of ADEQ's BART determination for PM10 at Cholla
Units 2, 3 and 4.
---------------------------------------------------------------------------

    \48\ 77 FR 9450 (February 16, 2012) (codified at 40 CFR
60.42Da).
    \49\ 40 CFR Part 51, Appendix Y, Section IV.C.
---------------------------------------------------------------------------

c. ADEQ's BART Analysis and Determination for SO2
    Comment: Citing various examples of lower SO2 limits at
other coal-fired units, one commenter argued that the existing
scrubbers at Cholla can be upgraded to achieve lower emission rates
than the 0.15 lb/MMBtu proposed by EPA. Based on the SO2
control data submitted by the commenter, the commenter asserted that
other BART upgrades are achieving higher removal efficiencies and/or
lower SO2 limits.
    Another commenter (Earthjustice) disagreed with EPA's proposal to
approve ADEQ's SO2 BART determination for Cholla Units 2, 3
and 4. The commenter states the approval is contrary to the RHR because
ADEQ's BART determination is not supported by a valid five-factor
analysis, which the commenter believes had flaws in its cost and
visibility improvement analyses. The commenter alleged that EPA
proposed to approve the SO2 BART determinations based on
unsupported speculation that the outcome would be the same if EPA
performed the BART analysis required by the RHR, although EPA
identified nothing in the docket to support its claim that a full BART
analysis would have yielded the same result. The commenter states that
EPA cannot speculate that it would reach the same conclusion as ADEQ,
and it must undertake an independent full five-factor BART analysis.
    The commenter further stated that ADEQ's SO2 BART
analysis for Cholla Units 2, 3 and 4 is also flawed because ADEQ failed
to analyze controls and upgrades that would result in emission rates
lower than the BART Guidelines' presumptive BART limits. According to
the commenter, EPA has recognized multiple times that the presumptive
BART limits are merely the starting point for the BART determination,
not the ending point. Moreover, the commenter asserted that the
presumptive limits are often outdated with the result that appropriate
consideration of the five statutory BART factors can result in far
lower emission rates than presumptive BART. The commenter cited
statements by EPA Region 6 (76 FR 64186, 64203, October 17, 2011,
regarding proposed actions on Arkansas' RH SIP) and EPA Region 9 (77 FR
51633 regarding the final RH FIP for the Four Corners Power Plant).
    Earthjustice also presented documentation that the commenter
believes to show that lower SO2 emission limits are
achievable and cost-effective at Cholla Units 2, 3 and 4. According to
the commenter, a report submitted with the comments (the ``Stamper
report'') \50\ shows that a proper BART determination for Cholla would
have found that 98 percent SO2 control efficiency achieving
a 0.04 lb/MMBtu emission limit is BART for the units, and that even
with the less-stringent 95 percent SO2 control efficiency
that is the basis of ADEQ's BART determinations, ADEQ should have
required an SO2 emission limit of 0.10 lb/MMBtu because 0.15
lb/MMBtu limit does not reflect 95 percent SO2 removal.
---------------------------------------------------------------------------

    \50\ Attachment 1 to Earthjustice Comments, Technical Support
Document to Comments of Conservation Organizations, Proposed Arizona
Regional Haze Partial SIP Approval and Partial FIP SO2
and NOX BART Determinations for Cholla Units 2, 3 and 4
(September 17, 2012), prepared by Victoria Stamper.
---------------------------------------------------------------------------

    Another commenter (APS) noted that the SO2 content of
the coal source for the Cholla plant is up to 3.0 lbs/MMBtu, and the
maximum rate of removal that will be continuously achievable after the
plant upgrades its scrubbers is 95 percent. Therefore, the commenter
asserts that 0.15 lb/MMBtu is the

maximum achievable SO2 emissions limit.
    Response: A number of commenters indicated that lower emission
levels are being achieved at other sources with wet FGDs and western
coal. However, none of these examples are based on coal with as high a
potential SO2 level as the coal that is currently burned at
Cholla. APS historically burned coal from the McKinley mine located on
the Navajo Reservation at the Cholla units. Following the closure of
this mine, APS obtained coal from various sources until the company
signed a long-term contract for coal from the El Segundo and Lee Ranch
mines in New Mexico.\51\ The sulfur content of coal from these two
mines is substantially higher than Powder River Basin (PRB) coal and
also much higher than coal from the former source, the McKinley
mine.\52\ The current coal contract for these units indicates that the
typical sulfur content of this coal is equivalent to 2.4 lb/MMBtu
SO2 and can be as high as 3.0 lb/MMBtu.\53\ Given that the
transition to this coal has already occurred and that company has
entered into a contract to continue purchasing this coal until 2024, we
consider emissions based on this coal supply to ``represent a realistic
depiction of anticipated annual emissions for the source.'' \54\ The
RHR and the BART Guidelines do not require states to restrict or alter
a facility's selection of the coal supply in order to meet a specific
limit.
---------------------------------------------------------------------------

    \51\ See ``Additional APS Cholla BART response'', Appendix B.
    \52\ See, e.g., ``APS Cholla Unit 2 BART report'', Table 2-2.
    \53\ See ``Additional APS Cholla BART response'', Appendix B,
Section 6.2.
    \54\ BART Guidelines, 40 CFR Part 51, Appendix Y, section
IV.D.4.d.
---------------------------------------------------------------------------

    APS's comments on the proposal indicate that the company intends to
upgrade the existing SO2 controls at Unit 2 to a new wet
flue gas desulfurization (FGD) system, identical to those already
installed on Units 3 and 4.\55\ APS further explained that:
---------------------------------------------------------------------------

    \55\ ``Comments of Arizona Public Service Company'', page 27.

    The coal source for [Cholla] is El Segundo and Lee Ranch coal
with an SO2 content of up to 3.0 lbs/mmBtu.The maximum
rate of removal that will be continuously achievable after the
scrubber upgrades * * * are performed is 95 percent. If compliance
is determined on a 30-day rolling average basis, the maximum
SO2 emission limit achievable at Cholla on a continuous
basis is, therefore, 0.15 lb/mmBtu. \56\
---------------------------------------------------------------------------

    \56\ Id. page 63.

Given this information, EPA finds that the ADEQ BART limit of 0.15 lb/
MMBtu represents BART for SO2 at these units. As noted by
APS, this limit would require a removal efficiency of 95 percent when
these units are burning this ``worst-case'' (highest-sulfur) coal
(i.e., 3.0 lb/MMBtu). Therefore, we are finalizing our approval of
ADEQ's BART limit of 0.15 lb/MMBtu of SO2 for these units.
    However, we remain concerned that this worst case coal is not
representative of the typical coal that APS will receive from the El
Segundo and Lee Ranch mines. APS's current contract for this coal
indicates that the minimum sulfur content is equivalent to 1.88 lb/
MMBtu of SO2 for the El Segundo coal and 1.64 lb/MMBtu of
SO2 for the Lee Ranch Coal.\57\ When burning this lower-
sulfur coal, the units would only need to achieve 90 to 92 percent
control in order to meet the BART limit of 0.15 lb/MMBtu of
SO2. While APS has stated that the scrubbers on Cholla Units
2, 3 and 4 will be able to continuously achieve a removal efficiency of
95 percent, the Arizona Regional Haze SIP does not include a
requirement or procedures to ensure that the scrubbers are operated and
maintained to achieve this level of control. Therefore, in order to
ensure that these scrubbers are properly operated and maintained,
consistent with 40 CFR 51.308(e)(1)(v), we are finalizing a removal
efficiency requirement for SO2 of 95 percent on a 30-day
rolling basis for Cholla Units 2, 3 and 4. This requirement is
explained further under ``Comments on Enforceability Requirements in
EPA's BART FIP.''
---------------------------------------------------------------------------

    \57\ See ``Additional APS Cholla BART response'', Appendix B,
Section 6.2.
---------------------------------------------------------------------------

4. ADEQ's BART Analyses and Determinations for Coronado Units 1 and 2
a. ADEQ's BART Analysis and Determination for NOX
    Comment: One commenter (NPS) agreed with EPA that ADEQ's BART
selection of LNB with OFA for Coronado is not adequately supported for
the following reasons:
     ADEQ did not consider the typical visibility metrics of
benefit at the area with maximum impact, nor benefits summed over the
areas.
     Using the default 1 ppb ammonia background concentration
would have increased estimated impacts and control benefits.
     There is no weighing of the visibility benefits and
visibility cost-effectiveness for the various candidate controls and
the various Class I areas.
     ADEQ does not indicate whether it considered any cost
thresholds to be reasonable or expensive in analyzing the costs of
compliance for the various control options.
    Similarly, another commenter (Earthjustice) supported EPA's
disapproval of ADEQ's NOX BART determination for Coronado
Units 1 and 2. For the reasons discussed by the commenter above for
Cholla Units 2, 3 and 4, the commenter agreed with what the commenter
said was EPA's conclusion that all of ADEQ's BART determinations are
fatally flawed in numerous respects (e.g., inflated costs and
underestimated visibility benefits). Specific to Coronado, the
commenter agreed that ADEQ failed to provide detailed and verifiable
cost information and to properly consider the costs of compliance for
each control option in its BART analysis (citing 77 FR 42851). In
addition, the commenter indicated that ADEQ failed to properly evaluate
the visibility benefits of more-stringent NOX controls at
Coronado, used a novel and unapproved metric to measure visibility
benefits, failed to consider cumulative visibility benefits across all
affected Class I areas, and used incorrect background ammonia
concentrations in its modeling. The commenter added that ADEQ also
failed to explain how it evaluated the five statutory BART factors and
selected BART based on the factors. The commenter asserted that because
ADEQ's BART analysis does not comply with the RHR's requirements, EPA
properly disapproved ADEQ's NOX BART determinations for
Coronado.
    Response: We agree that ADEQ's BART analysis for NOX at
Coronado Units 1 and 2 did not comply with the requirements of the CAA
and RHR.
    Comment: One commenter (SRP) stated that EPA must accept ADEQ's
BART determination for NOX because it was a complete and
thorough five[hyphen]factor analysis conducted in accordance with the
BART Guidelines and resulted in a reasonable and appropriate
determination of NOX BART for Coronado.
    Response: We do not agree with this comment. As explained in the
NPRM and elsewhere in this document, ADEQ's BART determinations for
NOX did not comply with the requirements of the RHR or the
BART Guidelines. Therefore, we are finalizing our disapproval of these
NOX BART determinations, including the determinations at
Coronado Units 1 and 2.
b. ADEQ's BART Analysis and Determination for PM10
    Comment: One commenter (NPS) agreed with EPA's proposal to approve
ADEQ's PM10 BART determination for

Coronado Units 1 and 2, noting that that emissions of PM10
from Coronado Units 1 and 2 are currently controlled by hot-side ESPs
and that, in terms of the consent decree, SRP is required to optimize
its ESPs to achieve a PM10 emission rate of 0.030 lb/MMBtu.
    Another commenter (SRP) stated that EPA's approval of the Arizona
BART determination for PM10 is reasonable and appropriate,
believing it to be consistent with the CAA and supported by the
technical record in this rulemaking. The commenter does not believe any
upgrades to the ESPs are warranted as part of the BART determination,
as SRP has in place a plan to optimize performance of the existing
equipment. The commenter noted that as part of the consent decree
between SRP and EPA for Coronado, SRP is required to operate the ESPs
``at all times when the Unit it serves is in operation to maximize PM
emission reductions, provided that such operation of the ESP is
consistent with the technological limitations, manufacturers'
specifications, and good engineering and maintenance practices for the
ESP,'' and this requirement also is reflected in Coronado's current
Title V operating permit.
    The commenter also noted that the PM10 limit in the
recently promulgated MATS Rule will be more stringent than the
PM10 limit proposed as BART. The commenter indicated that it
makes sense for BACT to be more stringent than BART, and it likewise is
appropriate for the MATS requirements to impose more stringent
compliance obligations on utilities than a BART determination since
MATS is intended to protect the public health from hazardous air
pollutants, while BART is aimed at aesthetic concerns that Congress
intended the states to address very gradually.
    In contrast, a third commenter (Earthjustice) disagreed with EPA's
proposal to approve ADEQ's PM10 BART determination for
Coronado Units 1 and 2. The commenter contended that EPA proposed to
approve the BART determination despite acknowledging that ADEQ did not
conduct a full BART analysis for PM10 because EGUs with ESPs
elsewhere have BART limits of 0.03 lb/MMBtu. However, the commenter
believes that lower emission rates are achievable and, as a result,
that EPA should disapprove ADEQ's BART determination, conduct a full
five-factor BART analysis and set a lower emission limit as BART for
PM10. According to the commenter, the Sahu report
demonstrates that nearly 150 EGUs across the nation with a variety of
PM controls achieve emission rates lower than 0.03 lb/MMBtu. The
commenter asserted that neither ADEQ nor EPA provided any explanation
why Coronado Units 1 and 2 could not similarly meet a lower emission
limit.
    Response: EPA acknowledges that ADEQ did not perform a rigorous
five-factor BART analysis for PM10 at Coronado. However, a
full five-factor analysis would be very unlikely to result in a change
of control technology for PM10. Modeling of visibility
impacts from direct PM10 emissions has shown very small
impairment for EGU PM10 emissions in comparison to
visibility impairment resulting from SO2 and NOX
emissions. The existing hotside ESPs at Coronado Units 1 and 2 control
PM10 by greater than 98 percent. In addition, SRP is
required under a Consent Decree to optimize the performance of these
ESPs and to meet a PM limit of 0.030 lb/MMBtu as measured by Method
5.\58\ The consent decree also requires Coronado to install and conduct
performance specification testing of a particulate matter CEMS
(PMCEMS).
---------------------------------------------------------------------------

    \58\ Consent Decree in United States v. Salt River Project, CV
08-1479-PHX-JAT (entered Dec. 19, 2008).
---------------------------------------------------------------------------

    Installing the best control, a baghouse, would result in a cost
exceeding $100,000/ton of additional PM removed. From a cost and
visibility improvement standpoint, it is not justifiable to require
replacement of controls that can achieve a reasonably low emission
level on a continuous basis. As noted previously, 0.030 lb/MMBtu is the
limit for filterable PM in the recently issued EGU MATS rule.
Therefore, we are finalizing our approval of ADEQ's BART determination
for PM10 at these units.
c. ADEQ's BART Analysis and Determination for SO2
    Comment: One commenter (NPS) noted that the consent decree between
EPA and SRP requires installation of wet flue gas desulfurization
(WFGD) systems on both Coronado units to achieve a 30-day rolling
average SO2 removal efficiency of at least 95 percent or a
30-day rolling average SO2 emissions rate of no greater than
0.080 lb/MMBtu. The commenter added that EPA proposed to approve ADEQ's
BART SO2 emission limit of 0.08 lb/MMBtu (30-day rolling
average) for Coronado Units 1 and 2, which the commenter indicated
would be consistent with the more stringent limits on WFGD upgrades
that the commenter has seen.
    One commenter (SRP) stated that EPA's approval of ADEQ's BART
determination for SO2 is reasonable and appropriate,
believing it to be supported by the technical record. In response to
EPA's request for comment on whether a lower emission limit may be
achievable when the units are burning a lower-sulfur coal, the
commenter responded that it is inappropriate for EPA to establish a
BART limit that would be premised on any restriction of SRP's fuel
supply. According to the commenter, this type of restriction would
increase unit operating costs and reduce operational flexibility, and
EPA provides no technical record to support consideration of this
emissions reduction option.
    Another commenter (Earthjustice) disagreed with EPA's proposal to
approve ADEQ's SO2 BART determination. The commenter states
the approval is contrary to the RHR because ADEQ's BART analyses are
not supported by a valid five-factor analysis. The commenter states
that EPA cannot speculate that it would reach the same conclusion as
ADEQ, and it must undertake an independent full five-factor BART
analysis, which the commenter believes would result in a SO2
BART limit of 0.04 lb/MMBtu based on a 30-day rolling average.
Earthjustice further asserted that, according to the Sahu report, WFGD
can achieve SO2 removal efficiencies of 98 percent and the
use of low-sulfur coals, which can further reduce SO2
emissions, also should have been investigated.
    Response: EPA does not agree that we should disapprove the ADEQ
BART determination and set an emission limit as low as 0.04 lb/MMBtu
for SO2. EPA does acknowledge that while burning some coals,
such as from PRB, these limits can be achieved at new units (though
only achieved continuously over longer than 30-day averages), but EPA
does not find that this limit would be consistently achievable at
Coronado. Coronado receives its coal supply by rail line and has access
to various sources of coal including PRB, Colorado and New Mexico
coals. As mentioned previously, the RHR and the BART Guidelines do not
require emission limits to be set at a level that would restrict the
flexibility of EGUs to use available coals with varying sulfur content.
    The consent decree between EPA and SRP described in our proposal
requires installation of wet flue gas desulfurization (WFGD) systems
(i.e., new scrubbers) at both units at Coronado by January 1, 2013.
These scrubbers are required to achieve either 0.080 lb/MMBtu of
SO2 or 95 percent reduction of SO2 across the
FGD, both

over a rolling 30-day basis.\59\ ADEQ has selected 0.08 lb/MMBtu as the
BART emission limit for these units. We find that this is an
appropriate limit for these units and are finalizing our approval of
this determination.
---------------------------------------------------------------------------

    \59\ Consent Decree in United States v. Salt River Project, CV
08-1479-PHX-JAT (entered Dec. 19, 2008).
---------------------------------------------------------------------------

    We also note that the recently promulgated EGU MATS rule, which
uses an SO2 limit as an acceptable surrogate for limiting
the emissions of hazardous acid gases, has set the limit at 0.20 lb/
MMBtu of SO2 for existing EGUs like Coronado Units 1 and
2.\60\
---------------------------------------------------------------------------

    \60\ 77 FR 9490 (February 16, 2012), codified in Table 2 to
Subpart UUUUU of 40 CFR Part 63.
---------------------------------------------------------------------------

C. General Comments on EPA's BART FIP Analyses and Determinations
1. Selection of Baseline Period
    Comment: Several commenters expressed disagreement with our general
approach to the selection of baseline periods. One commenter (NPS)
stated a general preference for the use of a baseline period that
represents pre-control emissions, as advised in the BART Guidelines, to
estimate baseline emissions for the purpose of calculating the average
cost-effectiveness of the complete control system (e.g., combustion
controls plus SCR). The commenter believes that this avoids any biasing
of the calculations by sources that install combustion controls during
the BART evaluation process. NPCA asserted that the ``proper'' baseline
for BART determinations is 2001-2004. ADEQ asserted EPA violated the
RHR provision in 51.308(d)(2)(i), which specifies the period for
establishing baseline visibility conditions as 2000-2004, by using the
period between 2008 and 2011 as a baseline period for EPA's BART
analyses.
    Response: We disagree that our use of updated baseline periods for
BART determinations is inappropriate or inconsistent with the CAA or
the RHR. While the RHR specifies 2000-2004 as the baseline for purposes
of measuring reasonable progress at Class I areas during the first
implementation period,\61\ neither the RHR nor the BART Guidelines
require that this particular timeframe be used as the baseline for BART
determinations at individual sources. Rather, the Guidelines provide
that, for purposes of calculating the costs of compliance:
---------------------------------------------------------------------------

    \61\ See 40 CFR 51.308(d)(2)(i).

    The baseline emissions rate should represent a realistic
depiction of anticipated annual emissions for the source. In
general, for the existing sources subject to BART, you will estimate
the anticipated annual emissions based upon actual emissions from a
baseline period.\62\
---------------------------------------------------------------------------

    \62\ BART Guidelines, 40 CFR Part 51, Appendix Y, section
IV.D.4.d.1

This provision is consistent with the statutory requirement that each
BART determination take into consideration ``any existing pollution
control technology in use at the source.'' \63\ While the Guidelines do
not specify particular dates for this ``baseline period'' for BART
analyses, in order to ``represent a realistic depiction of anticipated
annual emissions for the source'' the baseline can account for controls
already installed on the source, or, where appropriate, controls which
are required to be installed in the near future.
---------------------------------------------------------------------------

    \63\ CAA 169A(g)(2), 42 U.S.C. 7491(g)(2); see also 40 CFR
52.308(e)(ii)(A).
---------------------------------------------------------------------------

    In many instances, the 2000-2004 time frame was used as a baseline
period for BART determinations because this time frame reflected
existing controls in use at BART sources at the time BART analyses were
performed, following the issuance of the final BART Guidelines in 2005.
In Arizona's case, the initial BART analyses were performed in 2007,
using baseline periods that varied by source: 2002-2007 for Apache;
2001-2003 for Cholla; and 2001-2003 for Coronado.\64\ These periods
appear to reflect controls in existence at the time that these BART
analyses were performed. Our proposed disapproval of certain aspects of
Arizona's BART determinations was not based on any flaw in the choice
of baseline period.
---------------------------------------------------------------------------

    \64\ See, e.g., SIP Appendix D at 4; Apache Unit 2 BART analysis
at 2-2; Cholla.
---------------------------------------------------------------------------

    However, having proposed to disapprove Arizona's BART
determinations for NOX on other grounds, we were obligated
to conduct our own five-factor BART analyses for NOX for
these sources. At the time we conducted our analysis in 2011 and 2012,
several of these units had been retrofitted with additional
NOX controls that were not in place between 2000 and 2004.
In particular, Cholla had installed LNB on Units 2, 3 and 4 in 2008 to
2009, and Coronado had installed LNB at Unit 1 in 2009.\65\ In
addition, during this time period, Cholla completed its transition to a
different coal with much higher potential NOX emissions.\66\
Thus, in order to take into account existing controls and to ensure
that the baseline period accurately represented anticipated future
emissions, we updated the baseline period for each unit to ensure that
it reflected these changes.\67\
---------------------------------------------------------------------------

    \65\ 77 FR 42859, 42861. Although no new NOX controls
were installed at Apache during this timeframe, we determined that
more recent emissions data (2008-2011 rather than 2005-2007) were
more likely to represent future emissions. 77 FR 42856.
    \66\ 77 FR 42856, 42859, 42861.
    \67\ 77 FR 42861.
---------------------------------------------------------------------------

    With respect to Coronado Unit 2, we also took into account the
federally-enforceable emissions limits set by a Consent Decree between
the United States and SRP, which was entered in 2008.\68\ Again, this
is consistent with the BART Guidelines, which provide that:
---------------------------------------------------------------------------

    \68\ Consent Decree in United States v. Salt River Project, CV
08-1479-PHX-JAT (entered December 19, 2008).

    When you project that future operating parameters (e.g., limited
hours of operation or capacity utilization, type of fuel, raw
materials or product mix or type) will differ from past practice,
and if this projection has a deciding effect in the BART
determination, then you must make these parameters or assumptions
into enforceable limitations. In the absence of enforceable
limitations, you calculate baseline emissions based upon
continuation of past practice.\69\
---------------------------------------------------------------------------

    \69\ BART Guidelines, 40 CFR Part 51, Appendix Y, section
IV.D.4.d.2.

Consistent with this provision, for Coronado we used the consent
decree-mandated NOX emission limit of 0.08 lb/MMBtu in order
to ensure that the baseline emissions rate would represent a realistic
depiction of anticipated annual emissions for Unit 2.
    We note that such an ``updated baseline'' might not be appropriate
in all instances. For instance, if it appeared that controls had been
installed early in order to avoid a more stringent BART determination,
it would presumably not be appropriate to use a baseline representing
these new controls. We find no evidence of such intent here. Rather,
with respect to Coronado, the installation of new NOX and
SO2 controls was required by a consent decree. With respect
to Cholla, the installation of newly installed NOX and
SO2 controls coincided with increases in potential emissions
of these pollutants resulting from a change in coal supply.\70\
Therefore, the more recent baseline is likely to be more representative
of future operating conditions at these units.
---------------------------------------------------------------------------

    \70\ See Docket Item B-09, ``Additional APS Cholla BART
response'', Appendix B, Section 6.2.
---------------------------------------------------------------------------

    Contrary to the assertions of some commenters, use of updated
baselines did not unfairly penalize those sources that reduced their
NOX emissions in advance of a final BART determination.
Rather, the updated baseline effectively lowered the baseline
visibility impacts from these sources by reducing the baseline
emissions. As a result, the projected benefits of additional controls

were less than if we had used the original baseline. This approach is
consistent with the RHR and the BART Guidelines because it accurately
reflects controls in place at the time we performed our BART analysis.
Nonetheless, in order to address commenters' concerns about the effect
of the updated baselines on our proposed determinations, we have also
taken into account the original baseline periods considered by ADEQ, as
part of the supplemental cost analyses described below.
    Finally, we note that the use of a more recent baseline for
purposes of our BART analyses does not alter the baseline used for
purposes of measuring reasonable progress. As noted by several
commenters, the RHR specifies that, for purposes of setting RPGs and
measuring progress:

    The period for establishing baseline visibility conditions is
2000 to 2004. Baseline visibility conditions must be calculated,
using available monitoring data, by establishing the average degree
of visibility impairment for the most and least impaired days for
each calendar year from 2000 to 2004. The baseline visibility
conditions are the average of these annual values.\71\
---------------------------------------------------------------------------

    \71\ 40 CFR 51.308(d)(2)(i).

In its Regional Haze SIP, Arizona used IMPROVE monitoring data from
2000-2004 to calculate baseline visibility for the best and worst
visibility days for each Class I Area.\72\ Since these baseline
visibility conditions are calculated based on monitored conditions at
Class I areas, they reflect actual emissions that occurred during the
2000-2004 time frame, rather than any subsequently implemented
controls.
---------------------------------------------------------------------------

    \72\ AZ Regional Haze SIP at page 39.
---------------------------------------------------------------------------

    In developing its long-term strategy, a state must consider inter
alia ``[e]missions limitations and schedules for compliance to achieve
the reasonable progress goal'' and the ``anticipated net effect on
visibility due to projected changes in point, area, and mobile source
emissions over the next 10 years.'' \73\ This would include any
reductions in emissions from BART sources that are implemented prior to
a final BART determination, as well as any reductions resulting from
such a determination. Thus, in setting its RPGs for 2018, a state may
receive ``credit'' for any reductions achieved during the first
implementation period, regardless of whether or not those reductions
are reflected in the ``baseline'' emissions for a particular BART
source.
---------------------------------------------------------------------------

    \73\ 40 CFR 51.308(d)(3)(v)(G).
---------------------------------------------------------------------------

    EPA has not yet proposed action on Arizona's RPGs or long-term
strategy. Our ultimate action on these elements of the plan will take
into consideration all emissions reductions achieved during the first
implementation period, consistent with the requirements of the CAA and
the RHR.
2. Control Efficiencies and Emission Reductions for Alternative
Controls
    Comment: One commenter (NPS) concurred with EPA's reliance on an
SCR level of performance of 0.05 lb/MMBtu. The commenter noted that
this level is consistent with EPA's determination for the San Juan
Generating Station in New Mexico and EPA's assumptions for the Colstrip
and Corette power plants in Montana.
    Response: We acknowledge the commenter's concurrence. As described
further below, information received in comments on our proposal
continues to support the use of an SCR level of performance of 0.05 lb/
MMBtu on an annual average basis. Accordingly, we have retained the use
of 0.05 lb/MMBtu in our cost calculations (which are based on annual
emissions). However, in setting emission limits on a 30-day rolling
average basis, it is necessary to account for startup and shutdown
events, which raise the average emission rates over this shorter period
of time. Therefore, we have revised our proposed emission limits for
SCR at each of the sources. As explained below, we have also taken into
account other site-specific factors in revising the emissions limits.
In the case of Apache Units 2 and 3, we have performed a supplemental
analysis using AEPCO's cost estimates that are allowed by the CCM
(capital costs for the installation of SCR with LNB and OFA of $164.9
million). We also considered comments, the size of the Apache facility,
AEPCO's classification as a small entity, the economic effects of
requiring the use of SCR on Apache Units 2 and 3, and AEPCO's arguments
regarding an SCR emissions limit of 0.07 lb/MMBtu. As discussed below
in this preamble, we have concluded that in this case it is appropriate
to revise the 30-day rolling average SCR limit to 0.070 lb/MMBtu, with
a ``bubble'' across Apache Units 2 and 3. In the case of Cholla, we
have taken into account the need to accommodate startup and shutdown
events in the 30-day rolling average and have revised the limit to
0.055 lb/MMBtu, with a bubble across Units 2, 3 and 4. Finally, in the
case of Coronado, we have taken into account both the need to
accommodate startup and shutdown events, as well as the existing
consent decree, which sets an emission limit of 0.080 lb/MMBtu for Unit
2. Based on these considerations, we have set a two-unit 30-day rolling
average limit of 0.065 lb/MMbtu. For each of the three sources, we have
established the compliance determination method such that when one unit
is not operating, the emissions from its own preceding thirty boiler-
operating-days will continue to be included in the 30-day rolling
average. In the case of Coronado, for example, during periods when only
one unit operates, this method allows the one operating unit to average
out short-term emission spikes by using the most recent thirty boiler-
operating-day value from the non-operating unit. Otherwise, averaging
across units would not be possible during such periods, since the
emissions value from the non-operating unit would be zero since it is
not operating.
    Comment: One commenter (Earthjustice), based on a report submitted
with the comments (the ``Sahu report''), stated that SCR can achieve
greater NOX reductions and visibility benefits at less cost
than EPA's calculations. According to the commenter, while SCR systems
are capable of achieving 90 percent or greater removal, EPA's proposed
NOX emission limit of 0.05 lb/MMBtu represents control
levels of less than 90 percent at each of the Apache, Cholla and
Coronado units. Accordingly, the commenter believes that EPA should
have analyzed SCR with an emission limit of 0.04 lb/MMBtu because this
level is achievable at 90 percent removal.
    The commenter (Earthjustice), based on a separate report submitted
with the comments (the ``Stamper report''), stated that SCR systems are
capable of achieving 90 percent or greater removal and EGUs elsewhere
are subject to NOX emission limits as low as 0.03 lb/MMBtu.
The commenter cited several Prevention of Significant Deterioration
(PSD) permit limits based on BACT determinations, including a 0.03 lb/
MMbtu limit at Plant Washington, issued by Georgia Environmental
Protection Division, and 0.035 lb/MMBtu for Desert Rock, issued by EPA
Region 9. Accordingly, the commenter believes that EPA should have
analyzed SCR with an emission limit of 0.04 lb/MMBtu because this level
is achievable at 90 percent control for each of the units.
    Response: We agree with the information provided by the commenters