Apr 112012

By Teri Walker —

The future of coal-fired energy production in the U.S. is a current hot topic, with news accounts daily of coal plants to be shuttered, states banning coal-powered plants, organizations voicing their intent to shut down the coal industry, federal and state environmental agencies fighting over jurisdiction, and energy companies scrambling to retrofit their facilities to meet ever-changing air quality requirements. The dialogue at the national level is loud, the concern at the state level is tense, and the worry over potential plant closings and lost jobs in northern Arizona communities is growing.

In recent weeks, officials of three northern Arizona and nearby New Mexico coal power plants have announced concerns over their immediate futures. California-based Edison International reiterated its intention of getting out of the coal business altogether with the recent federal approval of a deal with Arizona Public Service Co. (APS) to purchase Edison’s holdings at the Four Corners Power Plant near Farmington, N.M. There are five units at the coal plant–three owned by APS that the company is shutting down because of the expense of retrofitting the aging units, and two owned by Edison that are now passing into APS’s hands. APS has said no layoffs are planned at the generating station at this time, but three of the five units will be shutting down.

Two weeks ago, officials with APS told The Tribune-News that the company is watching closely the outcome of wrangling between the State of Arizona and the Environmental Protection Agency (EPA) before determining whether it will be able to invest in retrofit technology to keep the Cholla Power Plant at Joseph City open.

Last week, representatives from the Navajo Generating Station in Page went before the Navajo County Board of Supervisors, entreating the board to write a letter of support for the coal-powered plant, which could also find itself facing shutdown if it isn’t financially feasible to invest in expensive emissions control measures. The Page power plant is operated by Salt River Project (SRP).

At the heart of the issue for each of the three power plants is ongoing disagreement between the Arizona Department of Environmental Quality and the EPA over emissions control technologies, regional haze and jurisdiction.

Under the federal Clean Air Act, states have until 2064 to bring visibility over a number of America’s treasured places to “natural conditions” through pollution management plans that would reduce haze. There are 160 Class 1 areas in the United States, 12 of which are in Arizona, where the “natural conditions” mandate applies. The Grand Canyon and Petrified Forest National Park are two of Arizona’s designated Class 1 areas that the Clean Air Act regulations address.

In December 2003, Arizona submitted a regional haze plan developed with other Western states to the EPA for review. According to Eric Massey, the director of the Air Quality Division at ADEQ, the EPA never issued a final ruling on Arizona’s submission. As air quality rules and standards changed in intervening years, and in response to questions and direction from EPA regarding Arizona’s report, the state submitted several amendments and updates to its original plan until January 2009, when, after five years of essentially allowing the plan to lay dormant, the EPA determined that parts of the plan were incomplete. For the next 16 months, Arizona worked with its partner states, Utah, Wyoming and New Mexico, along with the EPA, to address the issues and provide the EPA with information it requested. Finally, Massey said, when it became apparent the EPA’s concerns weren’t going to be addressed in a timely manner, Arizona opted to revise and submit a new plan, separate from its partner states, in February 2011.

Since the report has been gathering dust at the EPA, a number of environmental organizations filed a lawsuit against the agency saying it wasn’t moving fast enough or doing enough to address the regional haze issues. State officials became intensely concerned when the EPA began meeting with the environmental groups to discuss revisions to Arizona’s plan without inviting ADEQ to the table.

In December 2011, ADEQ and the Arizona Attorney General’s Office filed a request to intervene in the lawsuit.

“ADEQ is tired of the EPA and special interest groups making decisions through litigation in Washington, D.C., that directly impacts Arizona without affording Arizona a seat at the table,” ADEQ Director Henry Darwin said at the time. “The Clean Air Act gives states the right to develop air quality plans to address issues such as regional haze. The plaintiffs do not represent Arizona, and we have a responsibility and a right to be involved.”

The EPA and environmental groups began development of a proposed consent decree without Arizona’s involvement, which Arizona Attorney General Tom Horne said does not follow established guidelines.

“I am very concerned about collusion between the federal government and environmentalists who are entering into a ‘consent agreement’ that is unjustified and damaging to the economy. This can only be described as a series of meddlings by the federal government into areas where the State of Arizona should have an explicit role,” Horne said.

Massey said the way the process should properly play out would be for the EPA to review ADEQ’s proposed plan to meet federal air quality requirements and provide feedback to the state, then let the state make adjustments in response. The idea that the EPA and environmental groups would actually craft a replacement plan and issue it to the state rankles and is outside of the EPA’s jurisdiction, Massey said.

“We’re not saying to the EPA, ‘Don’t act,’ we’re saying don’t substitute your judgment for ours,” said Massey.

The EPA has filed a motion to proceed with the consent decree as written.

Massey said the EPA hasn’t shared any concerns with ADEQ about the last plan it submitted, and he doesn’t believe it’s appropriate for the EPA to at some point inform the state of its problems with the plan and in the same breath impose a federal implementation plan on Arizona.

“We’re invested in trying to ensure we get administrative due process,” said Massey. “Let us have a chance to fix anything they don’t like. We deserve the opportunity to correct any issues.”

One element Massey says it’s known that Arizona and other states are at odds about with the EPA is the technology that each believes is required to reach visibility standards. It is this sticking point that has the greatest impact on the decisions power plant owners are facing right now in determining whether they’ll be able to afford to keep operating.

ADEQ contends that the use of “low-NOx burner” and “over fire air” technologies are sufficient to clean up emissions to the standard required by the Clean Air Act. The EPA disagrees and wants power plants to retrofit their facilities with selective catalytic reduction (SCR) technologies, at a cost, according to an APS official, of eight to 10 times that of the state-approved technologies.

Both APS and SRP have said if the EPA requires the SCR retrofits, the costs could be prohibitive, threatening the future operation of the Joseph City and Page power plants.

Industry analysts have said the difference in the visibility standards achieved by the more expensive SCR technologies are so subtle as to not even be discernible to the human eye.

Massey explained that visibility is measured in units called “deciviews,” and the lowest level of change in visibility that the human eye can perceive is 0.5 to 1 deciview. He noted that some studies of the SCR technologies the EPA favors have shown a less than 0.5 deciview change, meaning the human eye doesn’t register the difference.

If the crux of this particular issue is visibility, ADEQ contends, then there isn’t sufficient evidence the SCRs are essential to achieving an appreciably superior visibility, nor is their disproportionate cost justified.

“SCRs are not cost effective if you’re not getting significant visibility improvement,” said Massey.

He points out that the state has conformed with the requirements to complete a management plan in response to the Clean Air Act, and has submitted a plan it believes will allow the state to reach the requirement of “natural conditions” in visibility by 2064.

The proposed consent decree would require the EPA to propose final action on ADEQ’s report by sometime in April or May, Massey said. If EPA holds to the schedule, Massey expects the EPA to take some sort of action by May 15.

“What we don’t want is for the EPA to finally issue its opinion on our report, tell us what they don’t like, then on the same day propose their own plan,” said Massey. To the EPA, Massey would say, “You shouldn’t be proposing fixes, we should put forward our own plan.”

APS officials have said they expect to make a decision about the future of the Cholla Power Plant later this year, based on how things turn out in the tug of war between ADEQ and EPA. EPA’s action, should it be taken by May 15, will give both APS and SRP a sense of their most likely required investments to meet visibility standards.