6.1. ERMUSR 09-15-2010 - Laserfiche WebLink

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American Public Power Association A~~-~1' August 20, 2010 Dear Affected APPA Member: tab Cmneclicul Avenue, NW Suite 1200 Washington, OG 200045715 Pn 2az as7 zgoc Fa.. zc2 as7zslo www.P,PPMeLOrg I am writing to update you about a recent rule issued by the U.S. Environmental Protection Agency (EPA) regazding Reciprocating Internal Combustion Engines (or RICE) units. As I believe you are aware, many public power utilities, particulazly in the Mid-west and Plains states, own and/or operate these diesel-fired units for back up, emergency or peak shaving operations. The final RICE rule was published by EPA on March 3, 2010, and based on feedback from many APPA members, it appeazs that the RICE rule impacts perhaps hundreds of very small units ranging between 500 horsepower to 3 MW. Many APPA members owning or operating these units have expressed strong concerns about the costs of retrofitting or replacing these units to comply with [he new emissions standards set in the rule as well as associated adverse impacts on power supply and system operations. The final RICE rule does allow these units to be run for emergency purposes without retrofit or replacement. However, some public power utilities may use the term "emergency" in a way that does not conform with EPA's definition. For example, EPA does not agree that voltage support constitutes emergency. Thus, we encourage you to review the EPA's definitions carefully. Emergency generation units must comply with far less stringent work practice standards instead of installing pollution control technology and this is a far less costly means of compliance. However, the definition of "emergency stationary RICE" states that RICE "used for peak shaving are not considered emergency stationary" engines and that RICE "used to supply power to an electric grid or that supply non-emergency power as part of a financial arrangement with another entity are (generally] not considered to be emergency engines." In addition, there are limited exceptions to the use of RICE units for revenue-generating purposes under the new RICE rule. Emergency RICE engines may generate revenue up to 15 hours per year when a regional transmission authority determines the emergency RICE are needed to prevent a potential electrical blackout, maintain system voltage, or similar situation. Please note that initial notifications must be filed with the apRropriate permitting authority by August 3l. 2010. Initial notification requirements apply if your utility will be covered under this new RICE rule. APPA has previously provided you a copy of the initial notification form for you to submit on behalf of your unit if you intend to run your units for non-emergency use, including peak shaving purposes. That form can also be accessed here: htto~/lwww epa goy/ttn/a[w/rice/rice initial notify doc Further, we understand that some APPA members want to synchronize the requirements of the RICE rule with certain contracts with regional transmission organizations that provide power from RICE for peak shaving. The new RICE rule sets National Environmental Standards for Hazardous Air Pollutants that will require retrofit controls for most engines above 300 horsepower (HP). Also, your utility should evaluate whether any engines fall under the 2006 NSPS (New Source Performance Standazds) that placed very strict limitations on what EPA considers to be an emergency compression ignition RICE. 71 Fed. Reg. 39,154-185. The 2006 NSPS affect new or reconstructed RICE as of the date of the proposed rule, which was July 11, 2005. ff you are affected by the NSPS rule