[Federal Register Volume 62, Number 125 (Monday, June 30, 1997)]
[Proposed Rules]
[Pages 35113-35114]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 97-17031]


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ENVIRONMENTAL PROTECTION AGENCY

40 CFR Part 69

[FRL-5850-5]


Special Exemptions From Requirements of the Clean Air Act for the 
Territory of Guam

AGENCY: Environmental Protection Agency (``EPA'').

ACTION: Notice of proposed rulemaking.

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SUMMARY: On February 11, 1997, the Governor of Guam submitted a 
petition (``Petition'') to the Administrator of EPA seeking a waiver of 
certain Clean Air Act (``CAA'') requirements which apply to two 
baseload diesel electric generators to be located at the Piti Power 
Plant on Guam. The Petition was submitted pursuant to section 325(a) of 
the CAA. The waiver will help to ease a serious and ongoing energy 
emergency on Guam. Based upon the information in the Petition, EPA is 
proposing to grant the waiver requested.
    The waiver allows two 45 megawatt baseload slow speed diesel 
electric generators and associated waste heat recovery boilers with a 
steam generator to be constructed, but not operated, at the Piti Power 
Plant prior to the receipt of a final Prevention of Significant 
Deterioration permit. Comments on this proposed rulemaking action may 
be made to the EPA as described below.

DATES: Comments on this proposed rulemaking action must be received on 
or before July 30, 1997.

ADDRESSES: Comments may be mailed to: Norman Lovelace, Chief, Insular 
Area Program, Cross Media Division (CMD-5), U.S. Environmental 
Protection Agency, Region IX 75 Hawthorne Street, San Francisco, CA 
94105.

FOR FURTHER INFORMATION CONTACT: Norman Lovelace, Chief, Insular Area 
Program, Cross Media Division (CMD-5), U.S. Environmental Protection 
Agency, Region IX, 75 Hawthorne Street, San Francisco, California 
94105. Telephone: (415) 744-1599.

SUPPLEMENTARY INFORMATION:

Background

    Via a letter dated February 11, 1997, Governor Gutierrez of Guam 
submitted a petition (``Petition'') to the Administrator of EPA. The 
Petition seeks a waiver of certain Clean Air Act (``CAA'') requirements 
for the construction of two 45 megawatt baseload slow speed diesel 
electric generators and associated waste heat recovery boilers with a 
steam generator. These units will be part of the Piti Power Plant. The 
units will be designated as Piti Units No. 8 and No. 9.
    The waiver application seeks to allow construction of Piti Units 
No. 8 and No. 9 prior to receipt of a Prevention of Significant 
Deterioration (``PSD'') permit. Neither of these Piti Units will 
operate prior to receipt of a final PSD permit.
    Guam has experienced a longstanding shortage of electrical energy, 
repeatedly leading to rotating blackouts in areas of the Island. The 
background to this energy shortage is described in a previous waiver 
proceeding before EPA in 1993. 50 FR 15579, 15580. The Petition 
describes how the 1993 energy shortage has continued despite a 
substantial capital development program by the Guam Power Authority 
(``GPA''). The energy shortage was created originally because of very 
rapid growth in energy demand due to increased residential electrical 
consumption and a boom in tourism. The Petition describes how energy 
shortfalls are now exacerbated as a result of substantial facility 
outages caused by equipment failures and a continued growth in demand.
    As EPA noted in the 1993 waiver proceeding, Guam is an isolated 
island. 58 FR 13580. GPA currently generates all commercial electric 
power used on the Island. Unlike power authorities on the mainland 
United States, GPA does not have the option of purchasing power from 
outside the Island. Guam is, and must remain, self sufficient with 
regard to electric power generation.
    The Petition states that Guam's electric power shortfall has 
continued because of facility outages caused by

[[Page 35114]]

planned and unplanned maintenance requirements. The longstanding nature 
of the electric power shortage has required GPA to use its existing 
facilities at peak capacity for several years. GPA has also deferred 
planned maintenance, when safety considerations have allowed, to permit 
units to remain in service. Because of the length of time which has 
elapsed since the beginning of the emergency, the result is now 
substantially reduced reliability of GPA's electric generating units.
    The Petition also describes how Guam's Legislature and Guam's 
Governor have actively become involved to find a solution to the 
continued energy crisis. In June 1996, the Legislature enacted special 
procurement legislation to allow the rapid purchase of new generating 
equipment. In response to the recommendation of a blue ribbon task 
force, the Governor issued an executive order in August 1996, directing 
GPA to oversee the repair of existing units, the construction of new 
units, and the operation of electric generating facilities by 
independent power producers. Piti Units No. 8 and No. 9 are a part of 
this effort, and will provide electricity to be distributed by GPA.
    The construction and operation of additional, reliable baseload 
generating units will enable GPA to satisfy electrical demand with an 
appropriate margin of safety, while at the same time allowing for 
planned maintenance outages of generating units. Once sufficient 
baseload capacity exists and can be operated, unplanned blackouts on 
the Island will be ended. Piti Units No. 8 and No. 9, which are to 
provide electric power under contract to GPA, are such baseload units. 
Construction of the units prior to the issuance of PSD permits will 
allow the units to become available in a much more expeditious time 
frame. It is anticipated that final PSD permits can and will be issued 
prior to completion of construction of Piti Units No. 8 and No. 9.
    Section 325(a) of the CAA allows a waiver of certain CAA 
requirements, based upon local factors, only if the waiver will not 
cause exceedences of any primary national ambient air quality standard 
(``NAAQS'') or violations of the hazardous air pollutant provisions of 
the CAA. The hazardous air pollutant provisions of the CAA are not 
affected by the Petition. The 1993 waiver proceeding and a subsequent 
1995 waiver proceeding included air quality analyses, utilizing 
computer modeling, which demonstrated that all NAAQS would be 
protected. Data submitted to the EPA pursuant to the prior waiver 
proceedings indicates that all NAAQS continue to be adequately 
protected.
    The Petition currently before the EPA is limited to the 
construction of Piti Units No. 8 and No. 9 prior to the issuance of PSD 
permits, and hence will not result in the increase of any air 
contaminant. Prior to the issuance of any PSD permit, the PSD 
permitting process will require, among other things, assurances that 
operation of Piti Units No. 8 and No. 9 will not lead to exceedences of 
any NAAQS.
    The Cabras and Piti Power Plants operate under an intermittent 
control strategy which utilizes fuel switching. This intermittent 
control strategy is described in an EPA document entitled the ``Cabras 
Area ICS.'' This strategy, which was modified pursuant to the 1995 
waiver proceeding, has required the use of fuel oil with a maximum 
sulfur content of 1.19 percent when winds blow in an onshore direction, 
and the use of fuel oil with a maximum sulfur content of 2.00 percent 
when winds blow in an offshore direction. If EPA issues the waiver 
requested in the Petition in a final rulemaking action, the Cabras Area 
ICS will be modified to require fuel switching at Piti Units No. 8 and 
No. 9 when operation of those units is commenced.
    Guam Environmental Protection Agency has received and reviewed a 
copy of the Petition. It supports this proposed rulemaking and the 
issuance of a waiver.

Regulatory Analysis

    Under the Regulatory Flexibility Act, 5 U.S.C. 600 et seq., EPA 
must prepare a Regulatory Flexibility Analysis assessing the impact of 
any proposed or final rule on small entities. 5 U.S.C. 603 and 604. 
Alternatively, EPA may certify that the rule will not have a 
significant economic impact on a substantial number of small entities. 
Small entities include small businesses, small not-for-profit 
enterprises, and government entities with jurisdiction over populations 
of less than 50,000.
    This proposed rule applies only to two large sources of air 
emissions used to generate electrical power on Guam. These sources of 
electrical power will be constructed by an independent power producer 
which is not a small entity. Therefore, EPA certifies that this 
rulemaking will not have an impact on small entities.
    This action has been classified as a Table 3 action for signature 
by the Administrator under the procedures published in the Federal 
Register on January 19, 1989 (54 FR 2214-2225). The Office of 
Management and Budget has exempted this regulatory action from 
Executive Order 12866 review.

List of Subjects in 40 CFR Part 69

    Environmental protection, Air pollution control.

    Dated: June 24, 1997.
Carol Browner,
Administrator.

    Part 69 of chapter I, title 40 of the Code of Federal Regulations 
is proposed to be amended as follows:

PART 69--[AMENDED]

    1. The authority citation for part 69 continues to read as follows:

    Authority: Section 325, Clean Air Act, as amended (42 U.S.C. 
7625-1)

    2. Section 69.11 is amended by adding paragraph (d) to read as 
follows:


Sec. 69.11  New exemptions.

* * * * *
    (d) Pursuant to Section 325(a) of the CAA and a petition submitted 
by the Governor of Guam on February 11, 1997 (``1997 Petition''), the 
Administrator of EPA conditionally exempts Piti Power Plant Units No. 8 
and No. 9 from certain CAA requirements.
    (1) A waiver of the requirement to obtain a PSD permit prior to 
construction is granted for the electric generating units identified in 
the 1997 Petition as Piti Units No. 8 and No. 9 (two 45 megawatt 
baseload diesel electric generators and associated waste heat recovery 
boilers with a steam generator), with the following conditions:
    (i) Piti Units No. 8 and No. 9 shall not operate until final PSD 
permits are received for these units;
    (ii) Piti Units No. 8 and No. 9 shall not operate until they comply 
with all requirements of their PSD permits, including, if necessary, 
retrofitting with BACT;
    (iii) If either Piti Units No. 8 or No. 9 operate either prior to 
the issuance of a final PSD permit or without BACT equipment, the Piti 
Unit(s) shall be deemed in violation of this waiver and the CAA 
beginning on the date of commencement of construction of the unit(s).

[FR Doc. 97-17031 Filed 6-27-97; 8:45 am]
BILLING CODE 6560-50-P