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Elk River <br /> Municipal Utilities UTILITIES COMMISSION MEETING <br /> TO: FROM: <br /> Elk River Municipal Utilities Commission Mike O'Neill—Technical Services <br /> John Dietz—Chair Superintendent <br /> Al Nadeau—Vice Chair <br /> Daryl Thompson—Trustee <br /> MEETING DATE: AGENDA ITEM NUMBER: <br /> September 8, 2015 5.3 <br /> SUBJECT: <br /> Environmental Pollution Agency Rules affecting ERMU's Diesel Generation Facility <br /> BACKGROUND: <br /> In preparation for the 2016 power contract with GRE in regards to the Diesel Engine Power <br /> Plant, I have been working with vendors/contractors to assess the need and cost of retrofitting <br /> and upgrading the exhaust systems for our#3 and#4 generators to bring them into compliance <br /> with new EPA regulations. <br /> DISCUSSION: <br /> The following information is submitted for your review: <br /> 1. The Environmental Protection Agency has created new regulations in regards to <br /> Stationary Engines. This affects two of our four engines because we allow GRE to place <br /> these generators on the Midcontinent Independent System Operator(MISO)market. <br /> 2. In the original Reciprocating Internal Combustion Engine rules, also known as R.I.C.E. <br /> rules, it stipulated that entity could run the engines up to 100 hours for testing and <br /> maintenance. This exception was later deleted by a court's decision. Another Petition for <br /> Review was submitted and a stay of the earlier ruling was granted until a final decision <br /> could be reached. This stay of issuance of the mandate will be in place through May 1 <br /> 2016. A final decision should be forth coming prior to the expiration of the stay. <br /> 3. Elk River Municipal Utilities (ERMU)must decide whether to upgrade the exhaust <br /> systems to bring them into compliance at a cost of approximately$400,000 or forgo <br /> placing them on the in the MISO market with GRE and keep the assets to be used for <br /> emergency use only. <br /> 4. If at a later time ERMU decides to bring these engines online in the MISO market,the <br /> engines will have to be brought into compliance with the rules at that time. <br /> EN 1OPEOEO IT <br /> Page 1 of 3 NATURE <br /> Reliable Public <br /> Power Provider P 0 WE 0.E D T O S E R V E <br /> 165 <br />