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September 12, 1988
Mr. John W. Boston
Vice President
Wisconsin Electric Power Company
Post Office Box 2046
Milwaukee, Wisconsin 52301
Dear Mr. Boston:
As you know, the State of Wisconsin has asked the Environmental
Protection Agency (EPA) Region V to review certain issues regarding
the applicability of the Clean Air Act's (Act's) prevention of significant
deterioration (PSD) requirements to the proposed life extension
project at the Port Washington electric generating station, which
is owned and operated by Wisconsin Electric Power Company (WEPCO).
In responding to that request, EPA Region V discovered that the
Port Washington project also raises questions regarding the applicability
of the Act's new source performance standards (NSPS) to the Port
Washington facilities as a result of the life extension project.
The purpose of this letter is to inform you of the results of our
inquiry.
Because the Port Washington life extension project involves matters
of importance to EPA as well as WEPCO, Region V sought assistance
from EPA Headquarter's offices in Washington, D.C., and Durham,
North Carolina. At the request of Region V and Headquarters staffs,
WEPCO submitted extensive information regarding the Port Washington
project and related interpretive issues, and I wish to thank you
for WEPCO's cooperation in this regard. In addition, at WEPCO's
request, meetings were held in Durham and Washington between WEPCO
and EPA representatives, and those meetings were helpful in our
deliberations. Based on the information provided by WEPCO, the State,
and EPA's own files, EPA Headquarters has furnished me with a memorandum
detailing EPA's position regarding the issues pertaining to the
Port Washington life extension project. A copy of this memorandum,
signed by Don R. Clay, Acting Assistant Administrator, is enclosed.
A copy is also being furnished to the State.
As explained in the enclosed memorandum, EPA has reached a number
of conclusions regarding the issues of legal interpretation surrounding
the Port Washington life extension project. These views should be
helpful to WEPCO in understanding the potential applicability of
the Act's new source provisions to the Port Washington project,
and in assessing its options with respect to that project. Based
on EPA's legal interpretations and the facts available at this time,
it appears likely that the project, if it were carried out as proposed,
would involve a substantial and nonroutine renewal of the Port Washington
facilities that may significantly increase potential emissions of
air pollutants for a period well beyond the current life expectancy
of those facilities. As such, this would be the type of project
that Congress intended to be subject to both PSD and NSPS requirements.
However, because certain critical factual information which would
dictate how the EPA's legal interpretations would actually apply
in this case are lacking, it is not possible at this time to provide
a final determination of either PSD or NSPS applicability to the
Port Washington life extension Project. Additional information would
be necessary in three general areas. (In addition, as a preliminary
matter, WEPCO should submit a formal request for an NSPS determination
pursuant to 40 CFR 60.5 if it desires a final NSPS applicability
determination.)
First, both the PSD and NSPS programs apply to modifications on
a pollutant- specific basis, and EPA has not been furnished with
sufficient data to firmly assess the impact of the proposed Port
Washington renovations on emissions from the facilities. The WEPCO
would need to provide such data before EPA could finally determine
whether emissions increases potentially triggering PSD and NSPS
applicability would occur.
Second, WEPCO may lawfully avoid both PSD and NSPS requirements
by adding or enhancing pollution control equipment, or, in the case
of PSD, restricting operations below maximum potential, such that
the emission increases necessary to trigger applicability would
not occur. Based on information supplied by WEPCO, it is our understanding
that the company already intends some enhancement of pollution control
equipment, and WEPCO may desire to undertake a combination of the
measures outlined above rather than subject itself to the Act's
new source requirements. If this is indeed the case, WEPCO should
so inform me so that appropriate discussions may be held between
WEPCO, this office, and the State, regarding the steps that would
be necessary to render the project not subject to PSD and NSPS.
Third, with respect to NSPS applicability to unit 1 at Port Washington,
additional information regarding the work to be performed is necessary
to determine whether a physical or operational change would occur
that could trigger applicability.
Again, I want to thank you for WEPCO's cooperation in this matter.
If you have any questions, please feel free to contact me.
Sincerely,
David A. Kee
Director
Air Management Division
Enclosure
cc: [Appropriate officials in Wisconsin]
bcc:
J. Emison, OAQPS
J. Calcagni, OAQPS
E. Lillis, OAQPS
G. McCutchen, OAQPS
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