Kawaihae Cogeneration Project
In re Kawaihae Cogeneration Project (EAB PSD Appeal Nos. 96-9, 96-10, 96-11, 96-14, and 96-16): permit review denied
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Plain-English summary
The Hawaii Department of Health issued a PSD permit and approval to construct a 58-megawatt cogeneration power plant near Kawaihae Harbor. The Environmental Appeals Board considered petitions from Hawaii Electric Light Company and nearby residents challenging the permit's selective catalytic reduction controls, emissions modeling, air-quality analysis, environmental impacts, and procedure. The Board held that the permit issuer adequately considered ammonia storage risks, applied the applicable BACT and modeling rules, and responded to the petitioners' comments. It also held that the record did not support the claimed excessive emissions or environmental harm, and that some issues concerned the State Title V portion of the permit outside the Board's jurisdiction. The Board denied all five petitions for review.
Decision snapshot
- Cited authorities: 42 U.S.C. §§ 7409, 7412(r), 7475, and 7661d; 40 C.F.R. §§ 51.100, 52.21, 70.2, 70.6, 124.9, 124.13, and 124.19
- Outcome: All five consolidated petitions for review were denied.
- Key point: The EAB limited its review to the federal PSD portion of the combined permit and denied review where the record supported the permit issuer's technical and procedural determinations.
Full text (EPA EAB public release)
KAWAIHAE COGENERATION PROJECT 107
IN RE KAWAIHAE COGENERATION PROJECT
PSD Appeal Nos. 96-9, 96-10, 96-11, 96-14, & 96-16
ORDER DENYING REVIEW
Decided April 28, 1997
Syllabus
Five petitioners seek review of a prevention of significant deterioration (“PSD”) permit and
approval to construct issued by the State of Hawaii’s Department of Health (“DOH”) to
Kawaihae Cogeneration Partners (“KCP”), pursuant to Clean Air Act § 165, 42 U.S.C. § 7475. The
permit authorizes KCP to construct a 58-megawatt cogeneration power plant near the Kawaihae
Harbor, on land leased from Hawaii’s Department of Hawaiian Home Lands (“DHHL”). The PSD
permit is a portion of a “covered source permit” that also includes operating conditions issued
pursuant to the State’s program implementing Clean Air Act Title V, 42 U.S.C. §§ 7661-7661f. The
PSD permit provides that as “best available control technology” (“BACT”) for nitrogen oxides,
the plant’s combustion turbines must be equipped with selective catalytic reduction (“SCR”)
units. The SCR units include equipment for the storage and handling of anhydrous ammonia.
The petitioners are the Hawaii Electric Light Company (“HELCO”) and four individual res-
idents living near the site of the proposed plant. HELCO opposes DOH’s permit decision, alleg-
ing that: (1) in selecting SCR as BACT, DOH failed to account for the collateral environmental
impacts posed by a potential catastrophic release of ammonia; and (2) DOH erred in setting the
permit’s maximum emission limits for certain pollutants, because KCP’s air impact analysis was
based on an unlawful “merged plume dispersion” modeling technique, and because DOH
should have required modeling for terrain-induced downwash. The individual petitioners allege
that: (1) the BACT analysis for SCR was inadequate; (2) studies of baseline levels of air pollu-
tion were not performed properly; (3) meteorological studies were inadequate; (4) the effect of
the plant on soils and vegetation was not properly analyzed, and an environmental impact state-
ment (“EIS”) should have been prepared; (5) the plant will emit “excessive” amounts of sulfur,
ammonia, lead and other chemicals; (6) DOH improperly ignored greenhouse gas emissions; (7)
the permit process was tainted by procedural and administrative defects; (8) the plant will
adversely affect human health and the environment; (9) the plant will displace native Hawaiians
from their homes; (10) an ammonia risk management plan required by the permit should be
subject to public review; (11) regulations were incorrectly cited in the permit.
Held: The Board concludes that petitioners have not met their burden of showing that
DOH’s permit decision should be reviewed. With respect to HELCO’s petition, the Board rejects
HELCO’s claim that a hypothetical failure of the SCR ammonia system warrants further consid-
eration as a “collateral environmental impact.” DOH properly considered the risks of ammonia
storage and handling, and concluded that permit and regulatory safeguards would minimize any
risk. The Board finds that the “merged plume dispersion” issue was not preserved for review,
because it was not raised during the public comment period as HELCO was obligated to do, and
so review of that issue must be summarily denied. Further, the Board concludes that because
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108 ENVIRONMENTAL ADMINISTRATIVE DECISIONS
KCP selected a stack height based on the regulatory “good engineering practices” formula, the
regulations did not require KCP to conduct modeling for terrain-induced downwash.
With respect to the individual petitions, the Board rejects KCP’s claim that two petitions
should be dismissed as untimely. Petitioners were mistakenly instructed by DOH to file petitions
with EPA’s Headquarters Hearing Clerk, and one petition was received by the clerk within the
filing deadline. Although the other petition was received by the Headquarters Hearing Clerk two
days beyond the filing deadline, it is unclear when the petition was received in EPA’s mailroom.
Under these circumstances, the petitions will not be dismissed as untimely.
As to the merits of the individual petitions, the Board concludes that: (1) DOH respond-
ed fully to concerns over the BACT analysis for SCR, and petitioners have not shown any error
in DOH’s response. DOH’s response is consistent with EPA’s “top-down” approach to BACT
selection. (2) DOH responded fully to petitioners’ concerns over the studies of baseline levels
of air pollution, and petitioners have pointed to no flaw in DOH’s approach. (3) Petitioners have
merely reiterated their earlier comments concerning the meteorological studies performed by
KCP (to which DOH responded fully), and petitioners have not shown that the studies were
inadequate in any way. (4) There was no requirement that an EIS be performed in connection
with this PSD permit issuance. KCP performed an “additional impact analysis” as required by
the PSD regulations, and the analysis showed that the soils and vegetation in the area around
the plant have poor productivity potential, that the plant emissions are well below federal and
State ambient air quality standards, and that no adverse impact on soils and vegetation from the
plant is expected. Petitioners have not shown any error in this conclusion. (5) The record does
not support petitioners’ claims that the plant will emit “excessive” amounts of sulfur, ammonia,
lead and other chemicals. DOH has explained that emissions of sulfur and lead will be below
federal and State ambient air quality standards, and that ammonia emissions will similarly pose
no threat to health. The record supports DOH’s selection of diesel fuel as BACT for sulfur emis-
sions, while allowing lower-sulfur naphtha fuel to be used as well, although naphtha was not
selected as BACT because of cost and availability concerns. (6) DOH explained that there are
currently no standards governing the emissions of greenhouse gases (mainly carbon dioxide)
from the plant, and petitioners have provided no information that suggests this conclusion is
erroneous. (7) Petitioners have pointed to no prejudicial defects in the permit review process.
(8) Petitioners’ generalized claims of environmental harm from the plant are not supported by
the record, which shows that plant emissions will not exceed any applicable PSD increment or
federal or State air quality standard. (9) The claim that native Hawaiians will be displaced from
their homes is unsupported, and DOH did not err by choosing not to address the issue in the
permit process since the issue is within the purview of the DHHL. (10) The permit condition
requiring submission of an ammonia risk management plan relates to State operating permit
requirements, and the Board does not have jurisdiction to review the non-PSD portion of this
permit. (11) The regulatory citations to which petitioners object concern the State operating per-
mit program, and the Board does not have jurisdiction to review that portion of this permit. For
these reasons, the petitions for review are denied.
Before Environmental Appeals Judges Ronald L. McCallum,
Edward E. Reich and Kathie A. Stein.
Opinion of the Board by Judge Reich:
I. BACKGROUND
We have consolidated for decision five petitions seeking review of
a decision of the State of Hawaii’s Department of Health (“DOH”) grant-
ing a prevention of significant deterioration (“PSD”) permit and
approval to construct to Kawaihae Cogeneration Partners (“KCP”), pur-
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KAWAIHAE COGENERATION PROJECT 109
suant to Clean Air Act § 165, 42 U.S.C. § 7475.1 The permit authorizes
KCP to construct and operate a 58-megawatt cogeneration power plant.
The plant will be constructed near the Kawaihae Harbor, on land leased
from the Department of Hawaiian Home Lands (“DHHL”), a State
agency created to administer lands described in the Hawaii Homes
Commission Act of 1920.2
The facility will consist of two 21-megawatt combustion turbines,
two unfired heat recovery steam generators and a 16-megawatt steam
turbine generator. The permit provides that as the “best available con-
trol technology” (“BACT”),3 the combustion turbines must be equipped
with steam injection for the control of nitrogen oxides (“NOx”) emis-
sions, with additional NOx control provided by two selective catalytic
reduction (“SCR”) units, resulting in stack outlet NOx concentration of
15 parts per million by volume dry (“ppmvd”) at 15% oxygen. The per-
mit further provides that the turbines will burn low-sulfur naphtha dis-
tillate fuel with a maximum sulfur content of 0.08% for two years, after
which (depending upon the availability and cost of naphtha) the tur-
bines will burn either naphtha, or diesel fuel having a sulfur content no
1
DOH administers the PSD program in Hawaii pursuant to a delegation of authority from
U.S. EPA Region IX. Because Hawaii acts as EPA’s delegate in implementing the federal PSD pro-
gram, the permit is considered an EPA-issued permit for purposes of federal law, and is subject
to review by the Board pursuant to 40 C.F.R. § 124.19. In re Commonwealth Chesapeake Corp.,
6 E.A.D. 764, 765 n.1 (EAB 1997); In re West Suburban Recycling and Energy Center, L.P.,
6 E.A.D. 692, 695 n.4 (EAB 1996) (“‘For purposes of Part 124, a delegate State stands in the shoes
of the Regional Administrator [and must] follow the procedural requirements of Part 124. * * * A
permit issued by a delegate is still an “EPA-issued permit” * * *.’”) (quoting 45 Fed. Reg. 33,413
(May 19, 1980)). Pursuant to Region IX’s delegation agreement with Hawaii, the Region retains
the authority to concur on DOH’s determinations of what constitutes “best available control
technology” for the control of regulated pollutants in PSD permits issued by Hawaii, and to con-
cur on DOH’s evaluation of air impact modeling analyses. Amended Delegation Agreement, 54
Fed. Reg. 23,978 (June 5, 1989).
2
The land was originally leased by Waimana Enterprises, Inc., a native Hawaiian corpo-
ration. DOH has explained that a “native [H]awaiian corporation” is “a corporation where the
majority of stock is owned by persons whose ethnicity is fifty percent or more native [H]awai-
ian. A native [H]awaiian corporation is also entitled to preference in the selection of commercial
operations on DHHL property.” DOH’s Response to Petitions for Review at n.1. Waimana sub-
sequently subleased the property to KCP. Waimana is the parent company of the two wholly-
owned subsidiaries that are the general and limited partners of KCP. DOH’s Response at 1-2.
DOH has explained that the land base administered by DHHL “is used to create residential and
commercial opportunities for native [H]awaiians, and may be operated independent of many
state and county regulations.” Id. at 2.
3
As explained in more detail infra Part II.A., BACT is an emissions limitation based on
the maximum degree of reduction achievable for a regulated pollutant, determined on a case-
by-case basis. See 40 C.F.R. § 52.21(b)(12).
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110 ENVIRONMENTAL ADMINISTRATIVE DECISIONS
greater than 0.4% by weight. The SCR units will include equipment for
storage and handling of anhydrous ammonia, including a 10,000 gallon
storage tank and vaporizer.4
Pursuant to State law, KCP submitted a combined PSD and Clean
Air Act Title V operating permit application to DOH in late 1993.5
Following review of the permit application, DOH issued a draft per-
mit for public review and comment, including a public hearing (held
in October 1995). Following consideration of public comments, DOH
prepared a final proposed permit, which it submitted to EPA Region
IX for concurrence in September 1996, pursuant to Hawaii’s
Amended Delegation Agreement. On October 21, 1996, Region IX
advised DOH that it concurred in the permit.6 DOH issued a final
decision granting the permit on October 29, 1996. These petitions for
review followed.
The petitioners are four individual residents of the State of Hawaii
who live near the proposed facility, and the Hawaii Electric Light
4
SCR is a “post-construction control technology which reduces NOx by reacting ammonia
with NOx in the presence of a catalyst to form water and nitrogen.” Admin. Record 8-F at 11.
Thus, SCR technology requires the storage and handling of anhydrous ammonia.
5
State law combines the PSD and Title V requirements into a single permit referred to as
a “covered source permit” (“CSP”). See H.A.R. § 11-60-01 et seq. (Hawaii’s Clean Air Act State
Implementation Plan, see 40 C.F.R. § 52.620); H.A.R. § 11-60.1-1 et seq. (Hawaii’s Title V program).
In general, a PSD permit is a pre-construction permit that sets forth conditions governing the
emissions controls that must be utilized by a new facility and emissions limits for certain regu-
lated pollutants. See 42 U.S.C. §§ 7470-7479. Title V operating permits encompass emissions lim-
itations and other conditions necessary to assure compliance with the Clean Air Act. Hawaii’s
Title V program was granted interim approval by EPA in December 1994, and thus the Title V
component of the CSP was issued pursuant to State law. See 40 C.F.R. part 70, Appendix A, and
61 Fed. Reg. 56,368 (Oct. 31, 1996). The Board’s jurisdiction with respect to review of this per-
mit extends only to review of the PSD component of the CSP, which, as explained supra n.1, is
considered a federal permit. See 40 C.F.R. § 124.19.
6
In connection with its review of the permit, Region IX required DOH to make certain
permit revisions. In particular, in accordance with Title V and Clean Air Act § 112(r), Region IX
required DOH to include a condition in the permit that requires KCP to submit a “risk man-
agement plan” for anhydrous ammonia. See Admin. Record 7-A. Section 112(r) concerns “pre-
vention of accidental releases” of certain “extremely hazardous substances,” including anhydrous
ammonia. 42 U.S.C. § 7412(r)(3). It requires certain stationary sources that have threshold
amounts of such substances to “prepare and implement a risk management plan to detect and
prevent or minimize accidental releases * * * and to provide a prompt emergency response to
any such releases * * *.” Id. § 7412(r)(7)(B)(ii). Pursuant to the Title V regulations, operating per-
mits must include a condition relating to the § 112(r) risk management plan requirement. See 40
C.F.R. §§ 70.2 & 70.6.
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KAWAIHAE COGENERATION PROJECT 111
Company (“HELCO”).7 The petitions collectively raise numerous objec-
tions to DOH’s decision to allow construction of the facility. The objec-
tions relate primarily to DOH’s analysis of SCR as BACT for the facility,
DOH’s setting of maximum emission limits for certain pollutants, and
alleged negative impacts that emissions from the facility will have on
the surrounding residents and the environment. At the Board’s request,
DOH submitted a response to the petitions. The Board also granted
requests by KCP and Region IX to respond to the petitions. DOH, KCP,
and Region IX argue that the petitions fail to meet the standards nec-
essary to invoke Board review of DOH’s decision, as set forth in 40
C.F.R. § 124.19.8 For the reasons explained below, we agree and must
therefore deny the petitions.9
II. DISCUSSION
A. Statutory Background
The Clean Air Act’s PSD program serves to regulate air pollution in
areas (known as “attainment” areas) where air quality meets or is cleaner
7
The individual petitioners are: Jojo Tanimoto, Linda Dela Cruz, Frank Hicks, and James
Growney. HELCO is one of three entities (including KCP) seeking approval from the Hawaii
Public Utilities Commission to construct and operate a power plant on the Big Island of Hawaii.
As such, HELCO is a competitor of KCP. HELCO has also submitted a PSD/CSP permit applica-
tion to DOH to construct and operate a power plant on Hawaii, in a different location from
Kawaihae.
8
Petitioners Tanimoto, Dela Cruz, Growney, and HELCO moved the Board for leave to
file replies to DOH’s, KCP’s, and Region IX’s responses to the petitions. The Board denied the
requests by separate orders. The Board notes that the rules governing petitions for review do
not contemplate further briefing by petitioners, except when the Board grants review of a peti-
tion. See 40 C.F.R. § 124.19(c). Although the Board will exercise its discretion to allow supple-
mental briefing in appropriate cases prior to deciding whether to grant review, in this instance
the Board determined that supplemental briefing would not aid it in its deliberations. The peti-
tions, the responses to the petitions, and the administrative record provide ample basis on which
the Board can evaluate the issues raised in the petitions.
9
Petitioners Tanimoto, Dela Cruz, and Growney also submitted petitions to the
Administrator pursuant to Clean Air Act Title V asking the Administrator to object to the permit.
Title V authorizes the Administrator to object to the issuance of a Title V permit if she deter-
mines that the permit is “not in compliance with the applicable requirements” of Title V. 42
U.S.C. § 7661d(b). The Title V petitions made allegations substantially identical to those raised
in the pending PSD petitions. The Administrator denied the Title V petitions. The Administrator
denied petitioners’ request insofar as the allegations made by petitioners related to the PSD
issues, citing the Board’s exclusive delegated authority to decide petitions for review of the PSD
conditions of a federally-issued permit. As to the other issues raised in the petitions, the
Administrator determined that petitioners had not demonstrated grounds for the Administrator
to object to the permit under Title V. See Order Denying Petition[s] for Objection to Permit at 3-4
(Adm’r, Mar. 10, 1997).
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112 ENVIRONMENTAL ADMINISTRATIVE DECISIONS
than the national ambient air quality standards (“NAAQS”),10 as well as
areas that cannot be classified as “attainment” or “non-attainment” areas
(“unclassifiable” areas). Clean Air Act §§ 160 et seq., 42 U.S.C. § 7470 et
seq.; see In re EcoEléctrica, L.P., 7 E.A.D. 56, 59 (EAB 1997); In re
Commonwealth Chesapeake Corp., 6 E.A.D. 764, 767 (EAB 1997). The
NAAQS are “maximum concentration ‘ceilings’ measured in terms of the
total concentration of a pollutant in the atmosphere.” New Source
Review Workshop Manual at C.3 (hereafter “Draft Manual”).11 The pri-
mary NAAQS “define levels of air quality which the Administrator
judges are necessary, with an adequate margin of safety, to protect the
public health,” and the secondary NAAQS “define levels of air quality
which the Administrator judges necessary to protect the public welfare
from any known or anticipated adverse effects of a pollutant.” 40 C.F.R.
§ 50.2(b).
The goals of the PSD program are:
(1) to ensure that economic growth will occur in har-
mony with the preservation of existing clean air
resources; (2) to protect the public health and welfare
from any adverse effect which might occur even at air
pollution levels better than the [NAAQS]; and (3) to pre-
serve, protect, and enhance the air quality in areas of
special natural recreational, scenic, or historic value,
such as national parks and wilderness areas.
Draft Manual at 5. To that end, the PSD regulations at 40 C.F.R. § 52.21
require, among other things, that new major stationary sources of air
pollution and major modifications of such sources be carefully
reviewed prior to construction to ensure that emissions from such facil-
ities will not cause exceedance of the NAAQS or applicable PSD ambi-
ent air quality “increments”. 40 C.F.R. § 52.21 et seq. A PSD “increment”
refers to “the maximum allowable increase in concentration that is
allowed to occur above a baseline concentration for a pollutant.” Draft
10
NAAQS have been set for six criteria pollutants: sulfur dioxide, particulate matter, nitro-
gen dioxide, carbon monoxide, ozone, and lead. See 40 C.F.R. §§ 50.4-50.12.
11
The New Source Review Workshop Manual is a draft document issued by EPA’s Office
of Air Quality Planning and Standards in October 1990. It was developed for use in conjunction
with new source review workshops and training, and to guide permitting officials. Although it
is not accorded the same weight as a binding Agency regulation, it has been looked to by this
Board as a statement of the Agency’s thinking on certain PSD issues. See EcoEléctrica, L.P.,
7 E.A.D. 56, 59 n.3 (EAB 1997); In re Masonite Corp., 5 E.A.D. 551, 558 n.8 (EAB 1994).
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KAWAIHAE COGENERATION PROJECT 113
Manual at C.3; 40 C.F.R. § 52.21(c) (setting forth increments for regulated
pollutants).
Among other requirements, and of importance to this appeal, the
PSD regulations require that new major stationary sources and major
modifications of such sources employ the “best available control tech-
nology” to minimize emissions of regulated pollutants. 42 U.S.C.
§ 7475(a)(4); 40 C.F.R. § 52.21(j)(2). BACT is defined in part as follows:
[BACT] means an emissions limitation (including a visi-
ble emission standard) based on the maximum degree
of reduction for each pollutant subject to regulation
under [the] Act which would be emitted from any pro-
posed major stationary source or major modification
which the Administrator, on a case-by-case basis, taking
into account energy, environmental, and economic
impacts and other costs, determines is achievable for
such source or modification through application of pro-
duction processes or available methods, systems, and
techniques, including fuel cleaning or treatment or
innovative fuel combustion techniques for control of
such pollutant.
40 C.F.R. § 52.21(b)(12). Permit issuers normally use a “top-down”
method for determining BACT:
[T]he top-down process provides that all available control
technologies be ranked in descending order of control
effectiveness. The PSD applicant first examines the most
stringent — or “top” — alternative. That alternative is
established as BACT unless the applicant demonstrates,
and the permitting authority in its informed judgment
agrees, that technical considerations, or energy, environ-
mental, or economic impacts justify a conclusion that the
most stringent technology is not “achievable” in that
case.
Draft Manual at B.2.
B. Standard of Review
Under the regulations that govern the Board’s review of PSD per-
mit decisions, a PSD permit decision will ordinarily not be reviewed
unless the decision is based on either a clearly erroneous finding of fact
or conclusion of law, or involves an important matter of policy or exer-
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114 ENVIRONMENTAL ADMINISTRATIVE DECISIONS
cise of discretion that warrants review. 40 C.F.R. § 124.19(a); see, e.g.,
EcoEléctrica, L.P., 7 E.A.D. at 60-61; Commonwealth Chesapeake Corp.,
6 E.A.D. at 769. The preamble to § 124.19 states that the Board’s power
of review “should be only sparingly exercised,” and that “most permit
conditions should be finally determined at the Regional [State] level * *
*.” 45 Fed. Reg. 33,412 (May 19, 1980). The burden of demonstrating
that review is warranted rests with the petitioner who challenges the
permit decision. See 40 C.F.R. § 124.19(a); EcoEléctrica, L.P., 7 E.A.D. at
61; Commonwealth Chesapeake Corp., 6 E.A.D. at 769. The Board has
explained that in order to establish that review of a permit is warrant-
ed, § 124.19(a) requires a petitioner to both state the objections to the
permit that are being raised for review, and to explain why the permit
decision maker’s previous response to those objections (i.e., the deci-
sion maker’s basis for the decision) is clearly erroneous or otherwise
warrants review. See id.; see also In re Puerto Rico Elec. Power Auth.,
6 E.A.D.253, 255 (EAB 1995); In re Genesee Power Station L.P., 4 E.A.D.
832, 866 (EAB 1993). The foregoing regulatory scheme “provides the
yardstick against which the Board must measure” petitions for review
of PSD and other permit decisions. Commonwealth Chesapeake Corp.,
6 E.A.D. at 769 (quoting In re Envotech, L.P., 6 E.A.D. 260, 265 (EAB
1996)).
C. The Merits
1. Petition of Hawaii Electric Light Company
HELCO raises two principal issues for review in its petition. First,
HELCO contends that DOH erred in its analysis of SCR as BACT for the
control of NOx emissions. In particular, HELCO contends that DOH
failed to adequately consider the alleged “health and safety hazards”
posed by the SCR system’s anhydrous ammonia unit (which includes a
10,000 gallon pressurized ammonia storage tank). HELCO’s Petition at
- HELCO argues that DOH is required to consider the “collateral envi-
ronmental impacts” posed by a particular technology in determining
what constitutes BACT, and that DOH erred by failing to consider the
potential that a “catastrophic release of ammonia” could occur. Id. at 9- - HELCO also argues that DOH failed to consider the collateral envi-
ronmental impact of spent catalyst disposal. Id. at 10. Second, HELCO
contends that the permit condition establishing maximum allowable
emission limits for certain pollutants is based on two errors. HELCO
argues that DOH erred in relying on data produced by “merged plume
dispersion,” a modeling method that HELCO contends does not comply
with EPA regulations. Id. at 4. Further, HELCO contends that DOH
ignored the effect of “terrain downwash” in setting emission limits. Id.
We will address each of HELCO’s issues in turn.
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KAWAIHAE COGENERATION PROJECT 115
a. DOH’s BACT Analysis
HELCO contends that DOH’s alleged failure to consider the collat-
eral environmental impact potentially posed by a catastrophic failure of
the anhydrous ammonia unit, thereby (in HELCO’s words) “literally
ignoring the risk of human casualties,” was clearly erroneous and impli-
cates important policy considerations. HELCO’s Petition at 5. HELCO
posits that the SCR’s ammonia system “is susceptible to a catastrophic
toxic vapor release, which could result in death or serious injury.” Id.
Specifically, HELCO alleges that:
On-site storage, transportation and use of anhydrous
ammonia presents a serious risk to public health and
safety because of the potential for a toxic vapor release.
Ammonia is fatal if inhaled in sufficient quantities and is
irritating to the eyes, nose, and throat in lesser amounts.
Ammonia that is inhaled, contacted by skin, or ingested
is intensely corrosive to human tissue.
An accidental rupture of the pressurized 10,000 gal-
lon anhydrous ammonia storage tank would result in
the discharge of a large quantity of ammonia gas into
the atmosphere. A screening analysis performed in con-
formance with EPA guidance shows that catastrophic
failure of the proposed 10,000 gallon anhydrous ammo-
nia tank could produce ammonia concentrations above
the Immediately Dangerous to Life and Health (IDLH)
level in an area up to thirty kilometers downwind from
the tank. * * * The use of anhydrous ammonia thus
poses a potential threat to those persons working and
living near the KCP site.
Id. at 6-7 (citing modeling analysis performed by HELCO’s consultants).
HELCO acknowledges that DOH considered and addressed “slip”
emissions of ammonia (ammonia that may be released during normal
operation of the SCR unit). However, HELCO contends that the Clean
Air Act and applicable regulations require DOH to address the poten-
tial for catastrophic release of ammonia as well. Id. at 9. HELCO argues
that if DOH considers the potential for a catastrophic release of ammo-
nia in its BACT analysis, then DOH “may conclude [that] the risk of
using anhydrous ammonia outweighs the benefit of lower NOx emis-
sions, especially given that the power plant’s ambient NOx impacts
without SCR would be relatively low. [DOH] must weigh the health risk
from anhydrous ammonia and the health benefit of lower NOx emis-
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116 ENVIRONMENTAL ADMINISTRATIVE DECISIONS
sions, then explain its determination.” HELCO Petition at 10. HELCO
contends that DOH must similarly consider the environmental impact
of disposal of spent catalyst used in the SCR system. HELCO contends
that the spent catalyst “may contain heavy metal oxides such as vana-
dium or titanium, and may be classified as hazardous waste. No Hawaii
facilities exist for the treatment or disposal of such hazardous waste.”
Id. at 10.
With respect to the potential for catastrophic failure of the ammo-
nia system, DOH, KCP, and Region IX argue that DOH considered the
collateral environmental impacts of SCR technology in its BACT analy-
sis to the extent required by the Clean Air Act. See DOH Response at 5-
6; KCP Response at 13; Region IX Response at 8-10. In particular, DOH
contends that HELCO’s argument is “factually incorrect,” because DOH
did consider the impact of a possible ammonia release in its analysis.
DOH Response at 4. DOH states that it reviewed the regulatory
schemes that govern ammonia storage and handling, and concluded
that catastrophic failure of the ammonia system would not occur if reg-
ulatory safeguards were followed. Id. DOH further contends that it
determined that the risk of catastrophic failure was “minimal,” based on
the safe use of such systems at hundreds of other facilities. Id. at 5.
DOH also argues that it “does not believe speculative disaster scenarios
are appropriately considered in a BACT analysis.” Id. at 5.
As noted earlier, BACT is defined as:
[A]n emission limitation based on the maximum degree
of reduction of each pollutant subject to regulation
under this chapter emitted from or which results from
any major emitting facility, which the permitting author-
ity, on a case-by-case basis, taking into account energy,
environmental, and economic impacts and other costs,
determines is achievable for such facility * * *.
42 U.S.C. § 7479(3) (emphasis added). With respect to the so-called “col-
lateral environmental impacts” of a proposed technology, this section has
been interpreted to mean that “if application of a control system results
directly in the release (or removal) of pollutants that are not currently reg-
ulated under the Act, the net environmental impact of such emissions is
eligible for consideration in making the BACT determination.” In re North
County Resource Recovery Associates, 2 E.A.D. 229, 230 (Adm’r 1986). The
Administrator has explained that the primary purpose of the collateral
impacts clause “is * * * to temper the stringency of the technology require-
ments whenever one or more of the specified ‘collateral’ impacts—ener-
gy, environmental or economic—renders use of the most effective tech-
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KAWAIHAE COGENERATION PROJECT 117
nology inappropriate.” In re Columbia Gulf Transmission Co., 2 E.A.D.
824, 826 (Adm’r 1989), see also In re Old Dominion Electric Cooperative,
3 E.A.D. 779, 792 (Adm’r 1992) (“While collateral environmental impacts
are relevant to the BACT determination, their relevance is generally
couched in terms of discussing which available technology, among sev-
eral, produces less adverse collateral effects, and, if it does, whether that
justifies its utilization even if the technology is otherwise less stringent.”).
The clause allows rejection of the most effective technology as BACT
only in limited circumstances. “[T]he collateral impacts clause operates
primarily as a safety valve whenever unusual circumstances specific to
the facility make it appropriate to use less than the most effective tech-
nology.” Columbia Gulf, 2 E.A.D. at 827 (emphasis added). Unless it is
demonstrated to the satisfaction of the permit issuer that such unusual cir-
cumstances exist, then the permit applicant must use the most effective
technology. Id.; see also In re World Color Press, Inc., 3 E.A.D. 474, 478
(Adm’r 1990) (“[T]he collateral impacts clause focuses upon specific local
impacts which constrain a particular source from using the most effective
control technology.”) (emphasis added).12
On the basis of this standard, we must reject HELCO’s claim that a
purely hypothetical catastrophic failure of the SCR ammonia system at
the proposed KCP facility warrants further consideration as a “collater-
al environmental impact” in DOH’s BACT analysis.13 HELCO has failed
to show that any facility anywhere utilizing SCR technology has expe-
rienced such a catastrophic failure, nor has it offered any information
that suggests that unusual circumstances or local conditions predispose
KCP’s proposed facility to such a failure.14
12
The Draft Manual similarly emphasizes the limited circumstances under which a tech-
nology that would otherwise be BACT could be rejected in favor of a less effective technology
on the basis of collateral environmental impacts. The Manual states that a control option may
be eliminated on the basis of “significant or unusual” collateral environmental impacts if it is
shown that “unusual circumstances at the proposed facility create greater problems than expe-
rienced elsewhere.” Draft Manual at B.47.
13
As stated above, there is no dispute that DOH addressed potential ammonia slip emis-
sions from the equipment, and concluded that ammonia emissions would pose no adverse
health effects. See DOH Response to Comments at 9.
14
See In re Foster Wheeler Passaic, Inc., PSD Appeal No. 89-1, 1989 PSD LEXIS 18 (Adm’r
1989) (unpublished) (rejecting collateral impacts challenge to selective non-catalytic reduction
technology where there was no showing that ammonia safety concerns were “unusual or
unique” to facility, and noting that the “transportation and use of ammonia in densely populated
areas is not uncommon” for many industries).
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118 ENVIRONMENTAL ADMINISTRATIVE DECISIONS
Moreover, the administrative record reveals that DOH did consider
the potential for ammonia leaks from the system, reviewed the regulato-
ry scheme that governs ammonia handling and storage, and concluded
that permit and regulatory safeguards would minimize any risk involved
in transporting and storing ammonia. In its response to comments
received on the draft KCP permit, DOH explained that:
The permit requires KCP to install a pressure detection
system for the safe operation of the ammonia storage
tank. Outside of the air permit requirements, there exist
state and federal standards for the storage of ammonia.
These standards are established to minimize the possi-
bility of ammonia leaks and ensure safe storage by
specifying design tank pressures, filling connection
valves, pressure relief valves, piping and hose require-
ments, nearby safety equipment, and minimum ammo-
nia transfer requirements.
Response to Comments at 6.15 Apart from merely alleging that DOH did
not consider the potential for a catastrophic failure and release of
ammonia, and did not respond to comments concerning potential risks
posed by the ammonia system (an allegation that is refuted by the fore-
going explanation), HELCO has failed to make any demonstration of
error in the manner in which DOH considered safety issues associated
with the ammonia system. The top-down BACT analysis provided by
KCP and reviewed by DOH identified no collateral environmental
impacts that rendered the use of SCR infeasible. Admin. Record at 1-H
Attachment 1. DOH’s response to comments plainly shows that it con-
sidered the risks associated with SCR technology, and found them to be
minimal. Response to Comments at 6, 9. HELCO’s exaggerated claim
that DOH has somehow placed human life at risk in its BACT analysis
is completely unsupported. Review on the basis of this issue is there-
fore denied.16
Further, DOH did consider the issue of disposal of the spent cata-
lyst from the SCR system in evaluating SCR technology as BACT. The
15
As explained supra n.6, in response to comments received from Region IX, DOH also
added a Title V condition to the permit that requires KCP to submit a “risk management plan”
for anhydrous ammonia, in accordance with regulatory requirements promulgated under Clean
Air Act § 112(r).
16
We note further that in November 1995 Region IX refused to concur in DOH’s BACT
determination for HELCO’s permit application, which did not include SCR technology. See
Admin. Record 8-A.
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KAWAIHAE COGENERATION PROJECT 119
administrative record shows that the catalyst is a ceramic-based zeolite
catalyst. See Admin. Record at 1-M. DOH contends that this type of cat-
alyst does not contain hazardous materials. DOH’s Response at 6.
HELCO has not demonstrated that the catalyst contains heavy metal
oxides, or may be classified as hazardous waste. In any event, KCP has
explained that the spent catalyst will be returned to the manufacturer
for disposal or recycling, rather than disposed of in Hawaii, as HELCO
fears. Admin. Record at 1-H. Because HELCO has not shown any error
in DOH’s consideration of the issue of spent catalyst disposal, review
on the basis of this issue must be denied.
b. Maximum Emission Limits
(1) Merged Plume Dispersion Analysis
HELCO argues that the Board should review the permit condition
establishing maximum allowable emission limits for sulfur dioxide
(SO2), particulate matter (PM10), carbon monoxide (CO), and oxides of
nitrogen (NOx), because DOH erroneously allowed KCP to utilize a
merged plume dispersion modeling technique that is contrary to the
PSD regulations, and DOH relied on KCP’s estimates of ambient air
quality impacts and increment consumption derived from merged
plume data in setting maximum emission limits. HELCO’s Petition at 11-
-
DOH, KCP and Region IX contend that this issue was not raised dur-
ing the public comment period, and therefore it was not preserved for
review. See 40 C.F.R. § 124.13 (all reasonably ascertainable issues con-
cerning draft permit must be raised “by the close of the public comment
period”); id. § 124.19(a) (petitions for review must include demonstration
that issues being raised were raised during public comment period).
DOH and Region IX further contend that even if the issue was preserved
for review, HELCO has misconstrued the regulations, and that the mod-
eling performed by KCP was consistent with regulatory requirements, in
light of the facility’s design. DOH’s Response at 6-7, Region IX’s Response
at 11-13.It is clear from the record that HELCO did not raise this issue in the
comments it submitted to DOH during the public comment period. See
HELCO Petition, Exhibit A. The record shows that the issue was raised
by the Hawaiian Electric Company (HECO, of which HELCO is a sub-
sidiary) by letter dated August 5, 1994, prior to issuance of the draft per-
mit and the opening of the public comment period in September 1995.
Id. Exhibit E. The issue was raised by HELCO to Region IX in October
1996 during Region IX’s review of the permit, long after the close of the
public comment period. Id. Exhibit G. However, this issue was not
raised by anyone to DOH during the public comment period, although,VOLUME 7120 ENVIRONMENTAL ADMINISTRATIVE DECISIONS
since it had been raised by HECO in August 1994, it was obviously “rea-
sonably ascertainable” to HELCO during the public comment period in
1995. The purpose of requiring all reasonably ascertainable issues to be
raised during the public comment period is so that the permit issuer
can address potential problems with the draft permit before the permit
becomes final. See, e.g., In re Brine Disposal Well, Montmorency
County, MI, 4 E.A.D. 736, 740 (EAB 1993). The permit review process
would be unmanageable if a permit issuer was required to discuss
every issue raised during the development of a draft permit prior to the
public comment period. Thus, HELCO had an obligation to raise the
issue during the public comment period, even if its parent company
had raised it at an earlier stage of the proceeding. Because no com-
ments were received on this issue during the public comment period,
DOH could well have assumed that any objections relating to merged
plume dispersion techniques had been resolved or abandoned. In
accordance with the rules governing appeals of PSD permits, because
the merged plume issue was not preserved for review, it must be sum-
marily denied. See In re EcoEléctrica, L.P., 7 E.A.D. 56, 75 (EAB 1997).17
(2) Terrain Induced Downwash
HELCO contends that DOH erred in establishing maximum emis-
sion limits for certain pollutants, because KCP’s ambient air quality
analysis failed to take into account the potential effect of “terrain
17
Further, we agree with DOH and the Region that HELCO’s claim is without merit. The
facility as originally designed called for two 100-foot stacks. However, KCP submitted an ambi-
ent air impact analysis based on a single-stack model. See DOH Response at 7; Admin. Record
1-T at 7-8. Prior to issuance of the draft permit, KCP redesigned the project so that both turbines
exhaust to a single 100-foot stack, and then KCP repeated the air impact modeling based on the
new single-stack design. Id. HELCO contends that the regulations prohibit KCP from redesign-
ing the facility for one stack and performing modeling based on a single-stack design, when it
had originally proposed a two-stack design. See HELCO’s Petition at 14-15. The regulations pro-
hibit the use of certain “dispersion techniques” in modeling ambient air quality impacts, includ-
ing “any technique which attempts to affect the concentration of a pollutant in the ambient air
by * * * increasing final exhaust gas plume rise by * * * combining exhaust gases from several
existing stacks into one stack * * * .” 40 C.F.R. § 51.100(hh)(1)(iii). However, the regulations pro-
vide an exception to the prohibition on merged plume modeling where “the facility was origi-
nally designed and constructed with such merged gas streams * * *.” Id. § 51.100(hh)(2)(ii)(A).
Plainly, there were no stacks “existing” when KCP performed its merged plume modeling. See
id. § 51.100(hh)(1). Moreover, the facility as redesigned and permitted will be constructed with
a single stack; therefore the merged plume modeling is not considered a prohibited “dispersion
technique”. See id. § 51.100(hh)(2). We agree with the Region that the plain intent of the regu-
lations is not “to prohibit construction of a stack that combines gas streams, but rather to pro-
hibit post construction merging of gas streams if separate stacks were assumed for air quality
impact purposes and originally constructed.” Region’s Response at 12-13.
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KAWAIHAE COGENERATION PROJECT 121
induced downwash,” i.e., that terrain features in the area surrounding
the proposed facility site could create conditions that would allow con-
centrations of regulated pollutants to exceed the applicable NAAQS or
increment limit. HELCO’s Petition at 17-18. HELCO argues that “[a]n
accurate and complete air quality analysis must consider the impact of
terrain downwash, as terrain downwash effects may influence plume
dispersion * * *.” Id. at 18.18 HELCO contends that:
The KCP project site is located on the lower slopes of
the 5000 foot tall Kohala Mountains, adjacent to the
Pacific Ocean. * * * The steep terrain in the project loca-
tion will have a pronounced effect upon dispersion of
emissions. Eddies form, resulting in the rapid mixing of
the exhaust plume, sending it downward. Downdrafts,
caused by winds blowing down the mountainside,
cause the plume to “droop,” also sending it downward.
Such conditions are likely to result in emission concen-
trations greater than those identified in KCP’s air quality
study.
Id. at 17-18. HELCO states that “[t]errain must be considered in down-
wash calculations under federal and state air regulations,” and that EPA-
approved techniques exist for addressing terrain downwash. Id. at 17,
20-21.
DOH, KCP, and Region IX respond that HELCO has incorrectly
confused downwash analysis requirements relating to an applicant’s
selection of stack height with ambient air quality impact analysis
requirements. See DOH’s Response at 8; KCP’s Response at 14; Region
IX’s Response at 13. Based upon our review of the applicable regula-
tions, we agree that consideration of terrain downwash effects in the
ambient air impact analysis was not required.
Pursuant to the PSD regulations, modeling of terrain downwash is
relevant in two circumstances. First, the regulations set forth require-
ments for performing fluid modeling or field studies of downwash
effects when a permit applicant selects a stack height that is greater
than the “good engineering practice” (“GEP”) stack heights set forth in
18
In performing its ambient air quality impact analysis, KCP used EPA models to predict
ambient concentration impacts in simple terrain, complex terrain, and intermediate terrain.
Admin. Record 8-F at 26. HELCO has not challenged KCP’s use of these models.
VOLUME 7
122 ENVIRONMENTAL ADMINISTRATIVE DECISIONS
the regulations. See 40 C.F.R. § 51.100(ii)(3).19 In this instance, KCP
designed a stack height of 100 feet, which is the GEP height based on
a formula contained in the regulations. See id. § 51.100(ii)(2).20 HELCO
does not contend that the GEP stack height for the facility is erroneous.
Since KCP chose the GEP formula stack height, it was not required to
justify a greater stack height through modeling of downwash and other
effects. See id. § 51.100(ii)(3).
The second circumstance in which downwash modeling becomes
relevant is when an applicant uses a stack height that is lower than the
GEP formula. The regulations provide that “if stacks for new or exist-
ing major sources are found to be less than the height defined by EPA’s
refined formula for determining GEP height, then air quality impacts
associated with cavity and wake effects due to the nearby building
structures should be determined. Detailed down-wash screening pro-
cedures for both the cavity and wake regions should be followed.” 40
C.F.R. Part 51, App. W, § 7.2.5. Because KCP’s stack height was not
lower than the height defined by GEP, then this requirement is inap-
plicable to it.
Thus, while HELCO is correct that techniques exist for evaluating
downwash effects, these techniques are inapplicable except to the
extent that an applicant’s stack height may deviate (higher or lower)
from GEP. Therefore, DOH committed no clear error by not requiring
KCP to conduct terrain downwash modeling in its ambient air impact
analysis.21 Further, after HELCO raised the downwash issue with DOH,
19
The regulations provide that the “degree of emission limitation required for control of
any air pollutant under this section shall not be affected in any manner by (i) So much of the
stack height of any source as exceeds [GEP] * * *.” 40 C.F.R. § 52.21(h). As DOH has explained,
this means that “[a]n applicant may not receive credit for the dispersion which will occur for that
portion of a stack in excess of the GEP stack height. In other words, one may not avoid air pol-
lution control requirements by building a very tall stack exceeding GEP stack heights.” DOH’s
Response at 8. When an applicant designs a stack height greater than that set forth in the for-
mula in the regulations defining GEP stack height, and wants to model ambient air impacts
based on the greater height, then the regulations require the applicant to conduct modeling for
terrain-induced downwash to justify use of the greater height. See 40 C.F.R. § 51.100(ii)(3).
20
The regulations give the permit issuer the discretion to require “a field study or fluid
model to verify GEP stack height for the source,” see 40 C.F.R. § 51.100(ii)(2)(ii), but this provi-
sion is not at issue.
21
In the course of evaluating KCP’s application, DOH contacted Region IX and explained
that:
[DOH] is of the understanding that currently there are no
known and acceptable techniques to quantify absolute con-
Continued
VOLUME 7
KAWAIHAE COGENERATION PROJECT 123
KCP did provide DOH and HELCO with a terrain downwash modeling
algorithm analysis derived from GEP guidelines. KCP’s analysis con-
cluded that “under the worst case conditions, the stack plume will
remain above any terrain-induced cavity and no downwash effect will
occur. If terrain-influenced downwash will not occur under these worst-
case conditions, it will not occur at all.” Admin. Record 1-HH at 4.
HELCO has provided no information or argument to challenge this con-
clusion, nor has HELCO shown that a different modeling method would
necessarily have resulted in a different conclusion.
2. Individuals’ Petitions
a. Timeliness of Growney and Hicks Petitions
KCP contends that the petitions of James Growney and Frank
Hicks were filed more than 30 days after the final permit decision was
issued, and should therefore be dismissed. The rules governing appeals
from PSD permit decisions provide that within 30 days after issuance of
a final PSD permit decision, any person who filed comments on the
draft permit or participated in the public hearing may petition the Board
for review of the permit decision. 40 C.F.R. § 124.19(a). The 30-day peri-
od within which an appeal must be filed commences with service of
notice of the permit decision, unless a later date is specified in the
notice. Id. When the permit decision is served by mail, three days are
added to the filing period. Id. § 124.20(d).
In this instance, KCP contends that notice of the permit decision
was served on October 29, 1996.22 The thirty-third day following
October 29 was Sunday, December 1, 1996. Because the last day fell on
a Sunday, the following day, Monday, December 2, 1996, would have
been the last day on which a petition could be filed. The Board
centrations resulting from terrain induced downwash. As
such, [DOH] is processing these applications and is propos-
ing to defer any evaluation until the U.S. [EPA] promulgates
terrain induced downwash guidance. If techniques are avail-
able, [DOH] will request the applicants to evaluate terrain
induced downwash.
Admin. Record 1-JJ at 1. The Region has confirmed that it supports this approach. See Region’s
Brief at 13-16.
22
The notice letter sent by DOH is dated October 24, 1996. Admin. Record 8-A. For pur-
poses of KCP’s motion, we will assume that the notice was not served (mailed) until October
29, 1996.
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124 ENVIRONMENTAL ADMINISTRATIVE DECISIONS
received both Hicks’ and Growney’s petitions in its office on December
4, 1996. However, DOH’s decision letter had erroneously advised recip-
ients that they should file their appeals with EPA’s Headquarters
Hearing Clerk, rather than with the Board. Admin. Record 8-A at 2. The
Headquarters Hearing Clerk is not in the same location as the Board,
and it frequently takes several days for mail that is misdirected to the
EPA Headquarters Hearing Clerk to reach the Board’s office. The record
shows that Hicks’ petition was stamped “received” by the Headquarters
Hearing Clerk on November 26, 1996, well within the filing deadline.
Petitioner should not be prejudiced for relying upon the erroneous
mailing address provided by DOH. Therefore, the petition will be
deemed timely filed.
As to Mr. Growney’s petition, the record shows that it was stamped
“received” by the Headquarters Hearing Clerk on December 4, 1996,
two days beyond the filing deadline. However, the Board routinely
accepts as timely any petitions that are received by EPA’s mailroom
within the filing deadline, since the Board’s mail is directed to a mail-
room at EPA Headquarters prior to distribution to the Board’s office.
E.g., In re Beckman Prod. Serv., 5 E.A.D. 10, 15 n.8 (EAB 1994). Mr.
Growney’s petition was not date-stamped by EPA’s mailroom prior to
distribution to the Headquarters Hearing Clerk, so the Board cannot
determine when it was actually received by the mailroom. In that the
Headquarters Hearing Clerk received it on December 4, Mr. Growney’s
petition may well have been received by the mailroom within the filing
deadline. The Board will therefore resolve this ambiguity concerning
the timeliness of the petition in Mr. Growney’s favor, and address the
petition on the merits.23
b. Merits of Individuals’ Petitions
The petitions filed by Ms. Tanimoto, Ms. Dela Cruz, Mr. Hicks, and
Mr. Growney collectively raise numerous issues concerning the draft
permit. However, to a great extent the petitions merely reiterate com-
ments that were provided to DOH during the course of public review
23
In an affidavit submitted by Mr. Growney in response to KCP’s contention that the peti-
tion was untimely, Mr. Growney attests that he mailed his petition for review on November 18,
1996, which should have allowed for timely receipt. See Affidavit of Growney at 2. Mr. Growney
also contends, however, that service of his petition upon the Board was complete upon mail-
ing, and thus his petition was timely regardless of when it was received by the Board. Growney’s
Reply at 1. This is incorrect. The Board has consistently held that petitions for review must be
received by the Board (or received by the mailroom) within the filing deadline to be timely. E.g.,
Beckman Prod. Serv., 5 E.A.D. at 15 n. 8
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KAWAIHAE COGENERATION PROJECT 125
of the proposed permit. As previously noted, to obtain review of a per-
mit decision it is not enough for petitioners to recite comments that
were previously provided to a permitting authority. Rather, the Board
has explained that:
[I]n order to establish that review of a permit is war-
ranted, § 124.19(a) requires a petitioner to both state the
objections to the permit that are being raised for review,
and to explain why the permit decision maker’s previ-
ous response to those objections (i.e., the decision
maker’s basis for the decision) is clearly erroneous or
otherwise warrants review. In re Puerto Rico Electric
Power Authority, 6 E.A.D.253, 255 (EAB 1995); In re
Genesee Power Station L.P., 4 E.A.D. 832, 866 (EAB
1993).
In re Commonwealth Chesapeake Corp., 6 E.A.D. 764, 769 (EAB 1997).
With that standard in mind, we will address each issue raised by peti-
tioners in turn.
(1) Analysis of SCR as BACT
Petitioners Tanimoto and Growney contend that SCR is an
“unproven” technology that was not properly studied or documented in
the course of the permit proceeding. Petitioners suggest that SCR may
not provide the lowest NOx reduction available, or may not perform as
represented by KCP.
DOH addressed this issue in some detail in its response to com-
ments. The record contains a top-down BACT analysis performed by
KCP’s consultants. Admin. Record 1-H.24 Based on this analysis, there
can be no real dispute that the water/steam injection plus SCR technol-
ogy proposed as BACT for this facility provides the most effective con-
trol of NOx. With SCR, the NOx emission rate is reduced to 15 ppmvd.
Using water injection alone (the next most stringent technology) results
in a NOx emission rate of 42 ppmvd.25 Admin. Record 1-H at 1.
Moreover, SCR technology has been utilized at numerous facilities, and
is not (as petitioners contend) “unproven” in terms of control effective-
24
The top-down method is described supra Part II.A.
25
HELCO, DOH, KCP, and Region IX are all in agreement on this point. HELCO’s challenge
does not concern whether SCR in fact provides the greatest control of NOx, but whether other
factors nevertheless render the technology infeasible. See supra Part II.C.1.
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126 ENVIRONMENTAL ADMINISTRATIVE DECISIONS
ness. Petitioners concerns apparently go to a perceived lack of detail in
the BACT analysis. As DOH explained in its response to comments:
DOH acknowledges the BACT analysis for SCR did not
discuss in detail the potential problems that may occur
with high temperature operations, possible deposit build
up in the heat recovery steam generator resulting from
fuel oil firing, and variable temperatures associated with
peaking operations. Detailed analyses and documenta-
tion are typically required if a top control option is reject-
ed as BACT. If the applicant cannot adequately justify the
elimination of a top control technology based on energy,
environmental, and economic impacts, the BACT selec-
tion should default to this control technology (EPA’s Draft
New Source Review Manual, October 1990). Since KCP
proposed the highest control option for NOx, a detailed
analysis was not required. The basis for their acceptance
[was] vendor guarantees and studies, and performance of
other candidates believed to be comparable.
DOH would like to emphasize that in proposing an emis-
sion limit based on a control technology as BACT, the
applicant will be fully responsible for compliance with
such emission limit and for the proper design and oper-
ation of the controls. Improper design or operation of the
controls, or the occurrence of any operating or technical
problems does not relieve KCP from complying with the
permit emission limits. If KCP fails to perform as permit-
ted, they will be subject to enforcement actions.
* * * * * * *
Pursuant to EPA’s Draft New Source Review Workshop
Manual, October 1990, an applicant proposing the top
control alternative is not required to provide cost data
on other possible control alternatives. Since the pro-
posed technology would result in the highest reduction
of NOx emissions, a comprehensive cost analysis
between control alternatives was not performed.
Response to Comments at 8. Petitioners have pointed to no error in this
response, which appears to fully address the issue as raised in com-
ments and the petitions for review. The DOH response is consistent
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KAWAIHAE COGENERATION PROJECT 127
with EPA’s top-down approach to BACT selection.26 Because petitioners
have not explained why DOH’s response on this issue is erroneous, we
must deny review of this issue.
(2) Baseline Studies
Petitioners Tanimoto and Growney contend that studies of baseline
levels of air pollution were not performed or were performed improp-
erly, and that studies were not conducted for PM10 and total suspended
particulates.
These same issues were raised during the public comment period,
and DOH responded to them in detail.27 See Response to Comments at
14-15. DOH explained that it allowed KCP to use data collected at other
areas to characterize the air quality in Kawaihae, and that the data used
were a conservative representation of Kawaihae’s air quality, since they
were taken from areas more populated or developed than Kawaihae.
Id. at 14. Because anticipated emissions from the proposed facility were
below de minimis levels for nitrogen dioxide and carbon monoxide,
KCP was exempted from one-year preconstruction ambient air quality
monitoring requirements for those pollutants. Id.; see In re EcoEléctrica,
L.P., 7 E.A.D. 56, 61-63 (permit issuer has discretion to exempt appli-
cant from monitoring requirements where emissions will not exceed
monitoring de minimis levels) (citing 40 C.F.R. § 52.21(i)(8)(i)); Draft
26
As the Region explains:
[O]ne purpose of the PSD provisions of the Clean Air Act and
its implementing regulations is to allow for the advance of tech-
nology in its application to pollution reduction. For this reason,
BACT continues to evolve and improve, and can become
applicable to broader categories of sources. When, as here, the
technology that is chosen by the permitting agency achieves
the highest level of pollutant reduction, the available informa-
tion indicates a high probability that it is technically feasible,
and it meets the other requirements of the top down analysis,
the use of such technology as BACT should be encouraged in
order to promote new applications of existing technologies.
Region’s Response at 7-7.
27
Region IX and KCP contend that Tanimoto and Growney did not raise these issues dur-
ing the public comment period, and therefore review should be denied on that basis. However,
the record shows that these issues were raised by other commenters during the public comment
period. See Response to Comments at 14-15. To preserve an issue for review, it is not necessary
that petitioners have personally raised the issue, only that the issue have been raised by some-
one during the public comment period. See, e.g., In re Masonite Corp., 5 E.A.D. 551, 559 n.9
(EAB 1994).
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128 ENVIRONMENTAL ADMINISTRATIVE DECISIONS
Manual at C.25. KCP was required to furnish monitoring data for sulfur
dioxide and particulate matter, because predicted peak impacts for
those pollutants exceeded de minimis levels. Consistent with EPA mon-
itoring guidance, DOH allowed KCP to use representative air quality
data for those pollutants, in lieu of conducting preconstruction moni-
toring. Response to Comments at 15.
Petitioners have pointed to no flaw in DOH’s approach to baseline
monitoring, as outlined in DOH’s response to comments. As Region IX
points out, EPA’s ambient air monitoring guidelines give permit author-
ities the discretion to allow representative data submissions (as
opposed to conducting new monitoring) on a case-by-case basis.
Region’s Response at 17 (citing Ambient Monitoring Guidelines for PSD,
EPA-450/4-87-007 (May 1987)); In re Hibbing Taconite Co., 2 E.A.D.
838, 851 (Adm’r 1989) (monitoring guidelines “are very broad and leave
much to the discretion of the permitting authority”). Petitioners have
not explained why such an approach is impermissible here, nor have
they alleged that a different approach to monitoring would have resulted
in different permit conditions. We therefore deny review of this issue.28
(3) Meteorological Studies
Petitioners Tanimoto and Growney claim that studies of meteoro-
logical conditions were inadequate and of insufficient duration to accu-
rately illustrate meteorological conditions in the Kawaihae area. These
same issues were raised during the public comment period, and
addressed in detail by DOH in its response to comments. DOH explained
that KCP performed one year’s worth of site-specific meteorological mon-
itoring, in accordance with regulatory requirements. Response to
Comments at 16; see 40 C.F.R. 51, App. W § 9.3 (Meteorological Input
28
DOH also notes that, in response to commenters’ concerns, it further analyzed the
impact of the KCP facility using two recent data sets. DOH’s Response at 12. One set was col-
lected at Hawaii’s largest industrial area, and the other at a site closer to an erupting volcano
than Kawaihae (the volcano is a source of sulfur emissions as well as other pollutants). Id. DOH
states that:
Despite the use of background data from these more popu-
lated and developed areas, the final conclusion did not
change. KCP continued to show compliance with the ambient
air quality standards. * * * The department believes the data
used by KCP is a conservative representation of Kawaihae’s
air quality, and requiring an additional year of data collection
will not change the analysis.
Id.
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KAWAIHAE COGENERATION PROJECT 129
Data). Petitioners have not shown that DOH’s conclusion was erroneous,
that the meteorological monitoring performed by KCP was inadequate in
any way, or that it was inconsistent with regulatory requirements. Review
on the basis of this issue must therefore be denied.
(4) Environmental Impact Statement
Petitioners Tanimoto, Growney, and Dela Cruz contend that the
effect of the plant on soils, vegetation, and commercial and recreational
property values has not been properly analyzed, nor has the potential
effect of hurricanes and waterspouts been analyzed. Petitioners claim
that KCP and DHHL have failed to prepare an environmental impact
statement (“EIS”) in connection with the proposed facility, as required
by law.
Although other provisions of law may require preparation of an EIS
for other purposes, there is no requirement that an EIS be prepared in
connection with the PSD permit process.29 As the Region points out,
actions taken under the Clean Air Act (including issuance of a federal
PSD permit) are exempt from the EIS requirement contained in the
National Environmental Policy Act (“NEPA”). See Region’s Response at
5 (citing 15 U.S.C. § 793(c)(1) (“No action taken under the Clean Air Act
shall be deemed a major federal action significantly affecting the qual-
ity of the human environment within the meaning of [NEPA].”);
Portland Cement Ass’n v. Ruckelshaus, 486 F.2d 375 (1973); Ethyl Corp.
v. EPA, 541 F.2d 1 (1976)); EcoEléctrica, L.P., 7 E.A.D. at 75 n.27 (not-
ing that PSD permitting process does not require the preparation of an
EIS).30 While receipt of a PSD permit does not relieve KCP of any oblig-
ation to comply with any applicable provision of State law (including
preparation of an EIS, if KCP is required by State law to do so), there
was no basis for DOH to require KCP to prepare an EIS in connection
with this PSD permit proceeding.31
Further, KCP did provide an “additional impact analysis” in con-
nection with its Ambient Air Quality Impact Analysis that assesses the
effects on soils and vegetation that are anticipated as a result of the
facility and growth associated with the facility. Admin. Record 8-F at
29
DOH notes that the issue of whether DHHL should have prepared an EIS is “a state ques-
tion currently before the Hawaii Supreme Court.” DOH’s Response at 13.
30
See also 40 C.F.R. § 124.9(b)(6) (“PSD permits are not subject to the [EIS] provisions of
[NEPA].”).
31
Permit condition 7 expressly requires KCP to obtain any other approvals that are
required by law. Admin. Record 8-B, Attachment I Condition 7.
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130 ENVIRONMENTAL ADMINISTRATIVE DECISIONS
29-31. The regulations require an applicant to analyze potential impacts
on soils and vegetation that may occur as a result of a proposed pro-
ject. The regulation specifically provides that the owner or operator of
a proposed source:
[S]hall provide an analysis of the impairment to visibility,
soils and vegetation that would occur as a result of the
source * * * and other growth associated with the source
* * *. The owner or operator need not provide an analy-
sis of the impact on vegetation having no significant
commercial or recreational value.
40 C.F.R. § 52.21(o)(1). KCP’s analysis showed that the site is “thinly
vegetated” with non-indigenous plant species, has rocky soil, and has
“very poor productivity potential for agricultural, orchard and grazing
uses.” Admin. Record 1-A at 83. The analysis concluded that emissions
from the plant would be “well below” state and national ambient air
quality standards, including the secondary NAAQS, which are intended
to prevent adverse impacts to the public welfare, including impacts on
soils and vegetation. Id. at 84; see 42 U.S.C. § 7409(b)(2). The analysis
further concluded that “no adverse impacts on soils and vegetation are
expected.” Admin. Record 1-A at 84.32
Petitioners have provided no information that contradicts DOH’s
conclusion that the plant will not adversely affect soils and vegetation
in the area. Petitioners have not shown that the soils and vegetation
have any significant commercial or recreational value that would be
negatively impacted by the plant, nor have they shown that there are
sensitive plant species that would be harmed by exposure to concen-
trations of pollutants below the secondary NAAQS.33 Accordingly,
review on the basis of these issues must be denied.
32
KCP also points out that it consulted with the U.S. Fish and Wildlife Service and the
National Marine Fisheries Service, and those entities concurred in KCP’s determination that the
project would not adversely impact endangered species or marine life. KCP’s Response at 20.
33
As the Draft Manual explains:
For most types of soils and vegetation, ambient concentra-
tions of criteria pollutants below the secondary [NAAQS] will
not result in harmful effects. However, there are sensitive
vegetation species (e.g., soybeans and alfalfa) which may be
harmed by long-term exposure to low ambient air concen-
trations of regulated pollutants for which there are no
NAAQS.
Draft Manual at D.5.
VOLUME 7
KAWAIHAE COGENERATION PROJECT 131
(5) Emissions of Sulfur, Ammonia and Lead
Petitioners Tanimoto and Growney contend that the plant will gen-
erate “excessive” amounts of sulfur, ammonia, lead and unspecified
“other dangerous chemicals.” Petitions of Tanimoto and Growney at 3.
Petitioners Tanimoto and Growney also contend that the proposed
waste ammonia disposal plan was not addressed in the permit process;
that the permit does not require use of lowest sulfur fuels; and that
DOH “wrongfully dismissed” concerns regarding additions to existing
levels of sulfur as a result of the erupting volcano. Id. Petitioners argue
that in light of these claims, DOH erroneously concluded that the facil-
ity would comply with PSD regulations and the NAAQS.
Petitioners claims are not supported by the record. As DOH has
explained, detailed analyses of expected emissions show that emissions
of sulfur and lead will not cause any violations of federal and State
ambient air quality standards, and that ammonia emissions will pose no
threat to health. See DOH Response at 14 (citing Admin. Record 8-D at
9, 19, 8-F at 24-28, 33-34, 38). DOH has determined that KCP is not a
major source for any hazardous air pollutants. Id. (citing Admin. Record
8-F at 33; 40 C.F.R. § 70.2). Further, the facility is not expected to pro-
duce any “waste ammonia.” Id.
With respect to the use of low-sulfur fuels, the record shows that
DOH considered low-sulfur (0.08% by weight) naphtha fuel as BACT
for SO2, but ultimately decided not to select naphtha as BACT because
of concerns for long-term availability and cost of the fuel on the island.
Admin. Record 8-E at 3. The permit instead allows KCP to use a 0.4%
by weight sulfur content diesel fuel as BACT for SO2. Id. However,
because KCP offered to burn low- sulfur naphtha for the first two years,
and thereafter when it is available and cost effective, the permit allows
KCP to burn naphtha. Id. at 4. Petitioners have raised no specific chal-
lenge to DOH’s SO2 BACT analysis apart from merely contending that
the permit allows use of “high sulfur” fuels. To the extent that the per-
mit allows use of fuels with greater sulfur content than naphtha, DOH’s
decision is fully explained and supported by the record.
As to DOH’s treatment of volcanic sulfur emissions, DOH has
explained that:
[Petitioner’s claim] probably is in reply to [DOH’s]
response to the public comments. [Admin. Record 8-D
at 5]. A comparison of KCP’s sulfur emissions to the
erupting volcano was made merely to give the public a
perspective as to the amount of sulfur emissions from
VOLUME 7
132 ENVIRONMENTAL ADMINISTRATIVE DECISIONS
KCP. The comparison was not used as a basis to dis-
miss the sulfur impacts from the project. Evaluation of
sulfur impacts were performed pursuant to regulations
in determining compliance with ambient standards.
The resulting analysis considered the cumulative
impact of KCP’s sulfur emissions upon existing back-
ground levels, including the emissions from the vol-
cano, and showed that the project’s maximum impacts
would be in compliance with federal and state ambient
air quality standards.
DOH’s Response at 16 (footnote omitted) (citing Admin. Record at 8-F;
40 C.F.R. §§ 50.4 & 50.5).
In light of the foregoing, petitioners’ unsupported allegations do
not persuade us that review on the basis of these issues is warranted.
Review is therefore denied.
(6) Emission of Greenhouse Gases
Petitioners Tanimoto and Growney contend that DOH ignored
greenhouse gas emissions, contrary to international agreements con-
cerning global warming. DOH explained in its response to comments
on this same issue that:
“Greenhouse” gases, mainly carbon dioxide, that could
contribute to global warming will be emitted from the
operation of the proposed power plant. However, at
this time there are no regulations or standards prohibit-
ing, limiting or controlling the emissions of greenhouse
gases from stationary sources. Carbon dioxide is not
considered a regulated air pollutant for permitting pur-
poses. In addition, no guidance is currently available to
assess a source’s carbon dioxide contribution to global
warming.
Response to Comments at 18. Petitioners have provided no information
that suggests DOH’s conclusion, as explained in its response to com-
ments, is erroneous.34 Accordingly, review on the basis of this issue
must be denied.
34
Region IX similarly urges us to deny review of this issue, arguing that while PSD permit
proceedings can, in appropriate cases, address broader concerns than protection of the NAAQS
and increments, there is no error in the way in which DOH addressed the greenhouse gas issue.
Region’s Brief at 18-19.
VOLUME 7
KAWAIHAE COGENERATION PROJECT 133
(7) Procedural and Administrative Defects
Petitioners Tanimoto, Growney and Dela Cruz argue that the per-
mit process was “marred by numerous and significant procedural and
administrative defects,” including a “confusing” version of the adminis-
trative record which DOH provided for public comment, and the fail-
ure of KCP to submit an application in “proper form.” Petitions of
Tanimoto and Growney at 4; see Petition of Dela Cruz at 2. The partic-
ular defects, and the manner in which such defects may have preju-
diced petitioners’ rights, are not specified in the petitions. DOH sug-
gests that confusion may have arisen because, in an effort to facilitate
review, it asked KCP to prepare an “unofficial” version of the adminis-
trative record for public review that contained only the “most current”
information concerning the application. DOH’s Response at 17. The
resulting file was marked “unofficial” and included an explanation of its
purpose. Id. Both the “official” and “unofficial” versions of the record
were made available for review. Id. at 17-18. DOH states that three
pages were missing from the official file due to a photocopying over-
sight, but that the pages were replaced within a day and later mailed to
all persons who submitted comments on the permit. Id. at 18. DOH fur-
ther states that objections to the “proper form” of the application appear
to relate to whether the person signing the application had appropriate
authority to do so. See id.; Response to Comments at 24.35
Our review of the record as provided to us and the transcript from
the public hearing does not disclose any apparent defects of process. It
is clear that petitioners were afforded ample opportunity to review and
provide comment on the proposed permit, and to pursue their right to
seek review before the Board. We recognize that the decisions that a
permitting agency must make with respect to a PSD permit application
are inherently technical and complicated, and the resulting administra-
tive record can be large and difficult to digest. In an effort to aid pub-
lic review, DOH may have inadvertently created some minor (and
short-term) confusion. Nevertheless, absent some specific demonstra-
tion of prejudice, petitioners’ vague allegations do not persuade us that
review on the basis of this issue is warranted.
35
DOH explained in its response to comments that the person signing the application, Mr.
Makoto Saito, had authority to do so as a “responsible official,” since he is the Senior Vice
President of Kaimana Energy, one of KCP’s general partners. Response to Comments at 24.
There is no express allegation in the petitions that Mr. Saito was not so authorized.
VOLUME 7
134 ENVIRONMENTAL ADMINISTRATIVE DECISIONS
(8) General Claims of Environmental Harm
Petitioners generally contend that the KCP facility will adversely
affect human health and the environment in the area surrounding the
facility, including important native religious and historic sites. See
Petitions of Tanimoto and Growney at 4. These allegations are not sup-
ported by the record. DOH concluded on the basis of KCP’s air quality
analyses that the anticipated emissions from the plant would not exceed
any applicable PSD increment, NAAQS, or State ambient air quality
standard. The standards are established to protect human health and
public welfare and the environment. See 42 U.S.C. § 7409. Petitioners
have provided no information that suggests DOH’s conclusion is erro-
neous, nor can we find any in the record. Review on the basis of this
issue must therefore be denied.
(9) Displacement of Natives
Petitioner Dela Cruz contends that native Hawaiians will be dis-
placed from their homes so that the KCP plant may be built. Dela Cruz
Petition at 1. The factual basis for this claim is not explained, and the
issue as framed by petitioner is too non-specific to provide a basis for
review. See Commonwealth Chesapeake Corp., 6 E.A.D. at 772. Further,
DOH points out that land use issues relating to the Hawaiian Home
Lands are within the jurisdiction of the DHHL. DOH Response at 19. As
explained earlier, DHHL leased the land to Waimana Enterprises, which
subleased it to KCP for construction of the plant. DHHL provided com-
ments during the public hearing on the permit supporting construction
of the plant. Admin. Record 4-C at 16-20. It appears that petitioner’s
concerns relate to DHHL’s decision to allow the plant to be built on
Hawaiian Home Lands, rather than to any specific permit action taken
by DOH. It was therefore not clear error for DOH to choose not to
address this issue in the permit process. See EcoEléctrica, L.P., 7 E.A.D.
at 73 (permit issuer did not err by not declining to issue a PSD permit
based upon concerns that were more appropriately deferred to a
different agency); Commonwealth Chesapeake Corp., 6 E.A.D. at 781
(same). Review on the basis of this issue must therefore be denied.
(10) Review of Ammonia Risk
Management Plan
Petitioner Frank Hicks contends that the requirement in the final
permit that KCP submit a risk management plan relating to storage and
handling of ammonia is a “permit modification” that should be subject
to public review and comment. As explained supra note 6, the provi-
sion was added to the permit in response to a comment received from
VOLUME 7
KAWAIHAE COGENERATION PROJECT 135
EPA Region IX concerning the applicability of the requirements of Clean
Air Act § 112(r) (prevention of accidental releases) to the ammonia unit,
in connection with Title V operating permit requirements. See Admin.
Record 7-A. Hicks contends that the public should have an opportunity
to review KCP’s risk management plan.
The permit condition in question relates to Title V operating per-
mit requirements, and the Board does not have jurisdiction to review
the non-PSD Title V portion of this permit, since that portion of the per-
mit is a State permit. See West Suburban Recycling and Energy Center,
6 E.A.D. 692, 704 (EAB 1996) (“[W]here a permit proceeding involves
requirements under both state and federal law, the scope of the Board’s
review is limited to issues relating to the federal PSD program and the
Board will not assume jurisdiction over permit issues unrelated to the
federal PSD program.”); In re American Ref-Fuel Co. of Essex County,
2 E.A.D. 280, 281 (Adm’r 1986) (only that portion of a State-issued com-
bined permit relating to the federally delegated PSD authority is review-
able under 40 C.F.R. § 124.19). Accordingly, review on the basis of this
issue must be denied.
(11) Citation to Hawaii Administrative
Regulations
Petitioners Tanimoto and Growney contend that DOH erred by cit-
ing H.A.R. § 11-60.1-1 et seq. in the permit, when those rules (relating
to Hawaii’s Clean Air Act Title V operating permit program) have not
been incorporated in Hawaii’s State Implementation Plan (SIP). As
explained above, the Board does not have jurisdiction to review the
non-PSD portion of this permit. Review on the basis of this issue is
therefore denied.36
III. CONCLUSION
For the foregoing reasons, the petitions for review are hereby denied.
So ordered.
36
Region IX has explained that the permit was issued pursuant to both the PSD regulations
(incorporated in Hawaii’s SIP at H.A.R. § 11-60-01 et seq.) and pursuant to Hawaii’s “covered
source permit” (CSP) program under H.A.R. § 11-60.1-1 et seq. Hawaii’s CSP program was
approved by EPA on December 1, 1994, in accordance with Clean Air Act requirements. 59 Fed.
Reg. 61,549 (Dec. 1, 1994); 61 Fed. Reg. 56,368 (Oct. 31, 1996). The program does not need to
be approved into Hawaii’s SIP. See Region’s Response at 4 n.1 (citing 40 C.F.R. § 70).
VOLUME 7
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