EPA REQUESTS VOLUNTARY REMAND OF ITS DESERT ROCK ENERGY PROJECT PSD PERMIT DECISION

Posted on May 7, 2009 by Jarry Ausherman

In the desert of New Mexico, the effect of another of the new Administration's shifts in previous federal environmental policy is being felt. As difficulties in permitting and building new coal-fired power plants have become more substantial, many power plant projects across the United States that were on the drawing board several years ago have fallen off of it. A notable exception is the Desert Rock Energy Plant, a joint project of the Navajo Nation's Diné Power Authority and Houston-based Sithe Global LLC that would be built on lands of the Navajo Nation. A significant step forward for that project had been EPA's issuance of the PSD permit in July of 2008. But recently, that step forward in air permitting has been followed by an administrative step back.

 

The Desert Rock Energy Project would involve construction of a 1500 megawatt coal-fired power plant on the Navajo Reservation. EPA's Region 9 had issued a final PSD permit for the project on July 31, 2008. The plant incorporates sophisticated, state of the art air pollution control technology, but it does not employ the coal gasification process known as "integrated gasification combined cycle" technology. Opponents to the project filed petitions with EPA's Environmental Appeals Board for review of the decision issuing the final PSD permit. The opponents raised greenhouse gas issues as well as other air quality and endangered species issues. Project opponents included the State of New Mexico.


In January, Region 9 filed its brief responding to the issues raised by the petitioners except the issue of whether the permit must contain an emissions limit for carbon dioxide. It withdrew the permit's response to comments explaining the basis for not evaluating carbon dioxide emissions in the BACT analysis. Region 9 requested the opportunity to file a Surreply Brief by April 27, 2009 to give EPA officials under the Obama Administration opportunity to consider more fully the positions previously advocated by EPA under the Bush Administration.

 

The EPA Administrator's office requested that Region 9 reconsider its permitting decision with respect to use of PM10 as a surrogate for PM2.5 to satisfy PSD requirements; consideration of IGCC in the BACT analysis; ESA consultation issues; MACT analysis for hazardous air pollutants; and the sufficiency of additional impact analysis. In response, on April 27, 2009, Region 9 asked the Environmental Appeals Board to remand the PSD permit for reconsideration and development of additional information by EPA. If the motion to remand is granted, the PSD permit will be sent back to EPA for further analysis, which could take many months and trigger another round of public comment.


The request for voluntary remand of this key permit for the high profile Desert Rock Energy Project is evidence of the degree to which the EPA under the current administration is reevaluating previous policy. In the case of Desert Rock, the EPA seeks to reevaluate a permit that it had already issued and defended in an appeal by opponents to permit issuance. If EPA's request for remand is granted, the extent to which EPA changes its permit decision remains to be seen. But the process itself presents the prospect for significant delays and additional public comment at a minimum.



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