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In re Indeck-Elwood, LLC

09/27/2006

Case Number:CAA PSD Appeal No. 03-04
ELR Citation:36 ELR 41305

On October 10, 2002, the Illinois Environmental Protection Agency (“IEPA”) issued a federal prevention of significant deterioration (“PSD”) permit to Indeck-Elwood, LLC (“Indeck”) for the construction of a coal-fired steam electric generating station. The facility would be located in Elwood, Illinois, near the Midewin Tallgrass Prairie (the “Midewin”)—a national prairie preserve. The American Lung Association of Metropolitan Chicago, Citizens Against Ruining the Environment, the Clean Air Task Force, Lake County Conservation Alliance, and the Sierra Club (collectively “Petitioners”) filed a timely petition for review with the Environmental Appeals Board (“Board”) opposing the IEPA-issued PSD permit on various grounds.

Petitioners argue that: (1) IEPA clearly erred in including Source-Wide Permit Condition 9, which allows Indeck to construct a power plant with less capacity than addressed by the permit application; (2) IEPA and Indeck failed to conduct a proper assessment of impairment to soils and vegetation that would occur as a result of the proposed facility; (3) the permit’s sulfur dioxide (“SO2”) limits do not reflect best available control technology (“BACT”) because Indeck did not credibly consider the use of low-sulfur coal; (4) the permit unlawfully allows Indeck to burn any “solid fuel” without defining such term or considering alternative fuels in its BACT analysis; (5) the permit provision exempting all shutdown, startup, and malfunction (“SSM”) events from short-term emission limits is unlawful; (6) Indeck’s proposed particulate matter (“PM”) emissions limit does not reflect BACT; (7) the permit’s nitrogen oxide (“NOx”) limit does not reflect BACT; (8) IEPA unlawfully failed to set a BACT limitation for fluorides; and (9) IEPA erroneously concluded that it has no obligation to consider alternative locations for the proposed facility. In addition, Petitioners raise several challenges relating to the Endangered Species Act (“ESA”) as it applies to this proceeding.

Held: The Board remands the permit on the following issues: the inclusion of Source-Wide Condition 9 (issue #1 above); IEPA’s soils and vegetation analysis (issue #2 above); the permit’s substitution of work and operational practices for BACT numeric limits during SSM events (issue #5 above); and the permit’s PM emissions limit and the absence of a limitation for condensable PM (issue #6 above). On all other issues, review is denied. The Board holds as follows:

(1) Source-Wide Condition 9:

Condition 9 allows the construction, without IEPA’s prior approval, of a power plant that has less capacity than that addressed in Indeck’s application. The addition of this permit condition after the close of the public comment period changed the substance of the PSD permit by allowing for construction of a facility physically different from the one originally permitted, which may potentially have different emission characteristics. Under these circumstances, the Board concludes that IEPA should have reopened or extended the comment period to subject this condition to public comment. The permit is therefore remanded. On remand IEPA must either remove Condition 9 from the permit or reopen the record and provide the public with an opportunity to comment on this issue and respond to any such comments received.

(2) Soils and Vegetation Analysis:

In view of the proximity of Indeck’s facility to a national vegetation preserve, and the lack of a reasoned analysis in IEPA’s response to comments addressing concerns raised during the public comment period regarding the adequacy of both Indeck’s soils and vegetation analysis and IEPA’s consideration of impacts to the Midewin, the permit is remanded on this issue. On remand IEPA must either: (1) augment its response to comments to clarify how its decision comports with the requirements for a more rigorous analysis and addresses the comments that were received on this issue, or (2) perform or consider analysis not presently in the record sufficient to address the concerns expressed in the Board’s decision.

(3) Substitution of Work and Operational Practices for BACT Numeric Limits During SSM Events:

Unit-Specific Condition 1.2.b and Table I exempt Indeck from compliance with short-term emission limitations applicable to the boilers of the proposed facility. IEPA claims that, contrary to Petitioners’ suggestion, the permit does not waive BACT limits during SSM events. Rather, IEPA states that the permit establishes work practices and operational BACT standards that operate in lieu of numerical limits in such circumstances. According to IEPA, it is technically infeasible for Indeck to comply with the numerical emission limits set as BACT during SSM events, and, under such circumstances, 40 C.F.R. §52.21(b)(12) allows the permit issuer to substitute work practices and operational standards for numerical limits. However, the Board concludes the circumstances considered by IEPA fall outside the scope of section 52.21(b)(12). That section allows substitution of numeric BACT limits only when “technological or economic limitations on the application of measurement methodology to a particular emissions unit would make the imposition of an emissions standard infeasible.” Because IEPA does not adequately invoke infeasibility in the application of measurement methodologies, and because the record lacks analysis comparing the emission reductions expected from the implementation of work practices and operational standards with those reductions that could be expected from the application of numeric limits, as contemplated by section 52.21(b)(12), the Board remands the permit on this issue for further analysis consistent with its opinion.

(4) PM and Condensable PM:

Because the record does not contain a sufficient explanation of why the PM limit adopted in the final permit, rather than the more stringent PM limits utilized for other facilities cited by Petitioners, constitutes BACT, the permit is remanded. On remand, IEPA must either provide further explanation and analysis supporting adoption of the permit’s PM limitation or adjust the PM limit, if necessary, to appropriately reflect BACT. The Board also remands the permit to IEPA to reconsider whether a PM limitation, including a limitation for condensable particulate matter is appropriate, and if so, to modify the permit accordingly.

(5) Other Issues:

The Board denies review on all other issues, including Petitioners’ permit challenges relating to the ESA. In regard to Petitioners’ ESA challenges, the Board holds that: (1) ESA consultation is required in the present setting where the permitting decision may affect listed species or designated critical habitat; (2) although, as a technical matter, the ESA consultation in this case, which took place during the pendency of this appeal, met minimum legal standards, the Board notes that it may be prudent for the Agency to move the ESA consultation process further up the permit development chain where there is more flexibility to make and implement any ESA-related permit modifications; (3) the ESA, the Clean Air Act, and the relevant regulations do not provide for public participation or public comment on the ESA consultation process as part of a PSD permit proceeding; and (4) the Board denies Petitioners’ request to amend the Petition to raise substantive questions regarding the quality of the ESA analysis and decisionmaking because such challenges belong in a different forum.