EPA Could Cost PNM $750 Million and Kill Jobs

Posted by Jim Spence on Saturday, August 6, 2011
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Four Corners Power Plant
The Daily Times - FARMINGTON — The U.S. Environmental Protection Agency on Friday ruled that San Juan Generating Station will be required to install expensive pollution controls to dramatically reduce emissions from the coal-burning power plant. The EPA ruling gives the plant's operator, Public Service Company of New Mexico, five years to comply. PNM immediately announced it would appeal the ruling. The agency's plan sets strict limits on nitrogen oxide emissions, which are linked to haze. The agency said its plan would reduce nitrogen oxide pollution by more than 80 percent. That would improve visibility at Mesa Verde National Park and 15 other federally protected areas, and benefit public health, the agency said. Local elected officials, business groups and PNM waged a fierce campaign to persuade the EPA that a less restrictive state plan would be adequate to cut pollution. The EPA turned away those efforts in announcing that selective catalytic reduction technology is necessary to cut pollution. PNM estimates installing that technology would cost more than $750 million and call into question the plant's long-term viability. The federal agency counters with its own estimate that the requirements will cost only about $229 million. Environmental groups hailed the ruling as a long-overdue reckoning for a major polluter. Read full story here: News New Mexico
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3 comments:

Anonymous said...

The Four Corners Power Plant probably does not have enough General Electric parts...they bring good waivers to life.

August 6, 2011 at 6:05 AM
Paul Lindsey said...

The Regional Haze requirements in regards to National Parks and Wilderness originated in the 1977 amendments to the CAA (Clean Air Act), and was further amended in 1997. EPA issued the rules in 1999, and states were required to submit plans for attainment by Dec 2007. The EPA was not running amuck, but meeting the requirements set by Congress.

(1) July 1997: EPA promulgated new NAAQS for 8-hour ozone and for PM2.5 (Particulate Matter 2.5 microns and larger), and told the states to prepare State Improvement Plans (SIP) in accordance with the CAA.

(2) April 2005: EPA published a ``Finding of Failure to Submit SIPs for Interstate Transport for the 8-hour Ozone and PM2.5 NAAQS.'' that applied to NM and other states and started a 2 year clock for the states to submit acceptable plans or the EPA would do it for them.

(3) August 2006: EPA issued a ``Guidance for State Implementation Plan (SIP) Submission to Meet Current Outstanding Obligations Under Section 110(a)(2)(D)(i) for the 8-Hour Ozone and PM2.5 National Ambient Air Quality Standards'' (2006 Guidance). In other words, here’s a cheat sheet on what we are expecting. One of the requirements was that the each state’s SIP meet the “good neighbor” requirements of the CAA: The SIP must prevent sources in the state from emitting pollutants in amounts which will: (1) Contribute significantly to nonattainment of the NAAQS in other states; (2) interfere with maintenance of the NAAQS in other states; (3) interfere with provisions to prevent significant deterioration of air quality in other states; or (4) interfere with efforts to protect visibility in other states. The 2006 Guidance stated that states may make a simple SIP submission confirming that it was not possible at that time to assess whether there is any interference with measures in the applicable SIP for another state designed to ``protect visibility'' for the 8-hour ozone and PM2.5 NAAQS until RH (Regional Haze) SIPs are submitted and approved. RH SIPs were required to be submitted by December 17, 2007.

(4) September 2007: NMED submitted a SIP to the EPA, but it did not address the RH requirement, and NM still had not addressed the RH requirement as of Jan 5, 2011. In addition, NMED did not make a submission demonstrating noninterference with the visibility programs of other states.

(5) Jan 2011: The EPA issue a “proposed rule” on Jan 5, 2011, because they determined that the NMED plan was incomplete and insufficient.

This is all in the EPA’s proposed rule, the first item listed on this link: http://www.regulations.gov/#!docketDetail;dct=PR;rpp=10;po=0;D=EPA-R06-OAR-2010-0846 (the second item is the notice of public hearing and the third is the extension of public comments.)

August 6, 2011 at 8:00 AM
Paul Lindsey said...

continuing ...
To me, the most interesting thing about this timeline is that most of it occurred under Gov Richardson’s watch. I would have expected that pro-renewable energy administration to have taken the EPA’s guidance as a golden opportunity to jump all over the San Juan Gen Station. In reading the EPA’s proposed rule, the EPA states that not only did NM fail to meet the EPA requirements, but the NM SIP violated the requirements of the Western Regional Air Partnership (WRAP), of which NM is a member. So why did NM under Bill Richardson submit a SIP that was incomplete and ineffective? Could it be that he was thinking about and then running for President, and knew that implementing rules that met the CAA would result in a big expense for PNM and ripple into higher electricity prices? So he left NM hanging, betting that a Democrat President would not sic the EPA on a Democrat Governor. Then the EPA comes down on NM like a ton of bricks just after a Republican Governor takes office.

PNM has known what the CAA requirement was for years and years. Instead of being proactive by starting retrofits piecemeal and spreading the pain out over many years, they have sat on their hands. Why? Because PNM knows that as a regulated monopoly, they will be allowed to pass on the costs to the consumer, just as state law allows utilites to collect the costs of renewable energy and renewable energy credits from the consumer. In other words, PNM was like a bus company that has hired alcoholic drivers with DWI’s on their record (coal power) for years in order to save money. After the law was changed to make that illegal, PNM maintained the status quo, and wasn’t going to change their habits while the police (NM) and the prosecutor (EPA) were dickering over what punishment was going to be. Now that the costs to hire clean drivers are out in the open, PNM’s response is to tell the riding public, “fine, if you want safe drivers, it’s going to cost you.”

August 6, 2011 at 8:01 AM

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