PacifiCorp said in its Nov. 6 quarterly Form 10-Q report filed with the SEC that it is making some progress with regulatory and legal actions related to regional haze compliance at power plants in Utah and Arizona.
The state of Utah had issued a regional haze State Implementation Plan (SIP) requiring the installation of sulfur dioxide, nitrogen oxides and particulate matter controls on Hunter Units 1 and 2, and Huntington Units 1 and 2. In December 2012, the EPA approved the sulfur dioxide portion of the Utah regional haze SIP and disapproved the nitrogen oxides and particulate matter portions. Certain groups appealed the EPA’s approval of the sulfur dioxide portion and oral argument was heard before the U.S. Court of Appeals for the Tenth Circuit in March 2014. In October 2014, the Tenth Circuit upheld the EPA’s approval of the sulfur dioxide portion of the SIP.
The state of Utah and PacifiCorp filed petitions for administrative and judicial review of the EPA’s final rule on the best available retrofit technology (BART) determinations for the nitrogen oxides and particulate matter portions of Utah’s regional haze SIP in March 2013. Oral argument was held before the Tenth Circuit in March 2014. In May 2014, the Tenth Circuit dismissed the petition on jurisdictional grounds.
In addition, and separate from the EPA’s approval process and related litigation, the Utah Division of Air Quality has undertaken an additional BART analysis for Hunter Units 1 and 2, and Huntington Units 1 and 2. The additional BART analysis and revised regional haze SIP was submitted in June 2015 to the EPA for review and proposed action after a public comment period. The revised regional haze SIP includes a state-enforceable requirement to cease operation of the Carbon coal plant by Aug. 15, 2015, and PacifiCorp has begun decommissioning activities at the plant, which was shut earlier this year due to federal Mercury and Toxics Standards (MATS) compliance needs.
As a result of a suit brought to enforce the EPA deadlines for taking action on the Utah SIP, the EPA is expected to review and take final action on the SIP in March 2016 pursuant to a proposed consent decree. It is unknown how the EPA’s decision regarding the Utah SIP may impact PacifiCorp’s obligations under the regional haze requirements, the utility said.
Also related to regional haze, the state of Arizona issued a regional haze SIP requiring, among other things, the installation of sulfur dioxide, nitrogen oxides and particulate matter controls on the coal-fired Cholla Unit 4. The EPA approved in part, and disapproved in part, the Arizona SIP and issued a Federal Implementation Plan (FIP) for the disapproved portions requiring selective catalytic reduction controls on Cholla Unit 4. PacifiCorp filed an appeal in the U.S. Court of Appeals for the Ninth Circuit regarding the FIP as it relates to Cholla Unit 4, and the Arizona Department of Environmental Quality and other affected Arizona utilities filed separate appeals of the FIP as it relates to their interests.
The Ninth Circuit issued an order in February 2015, holding the matter in abeyance relating to PacifiCorp and Arizona Public Service as they work with state and federal agencies on an alternate compliance approach for Cholla Unit 4. In January 2015, Arizona Public Service submitted the permit applications and studies required to amend the Title V permit, and subsequently the Arizona SIP to convert Cholla Unit 4 to a natural gas-fueled unit in 2025. The Arizona Department of Environmental Quality prepared a draft permit and a revision to the Arizona regional haze SIP, held two public hearings in July 2015 and, after considering the comments received during the public comment period that closed on July 14, 2015, submitted the final proposals to the EPA for review, public comment and final action.