(Washington, DC – June 24, 2015) EPA and the Department of Justice announced today a consent decree with Arizona Public Service Company (APS), Southern California Edison (SCE), El Paso Electric Company (El Paso Electric), Public Service Company of New Mexico (PNM), Salt River Project Agricultural Improvement and Power District (Salt River Project), and Tucson Electric Power Company (Tucson Electric Power), (collectively Defendants).

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Overview of Company

Defendants represent a group of public and private entities that together own FCPP. The two unit, 1,540-megawatt Four Corners Power Plant, located on the Navajo Indian Reservation west of Farmington, New Mexico, is operated by APS. APS is Arizona’s largest and longest-serving electric company, providing more than 1.1 million retail and residential customers in 11 of Arizona’s 15 counties.

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Violations

The EPA began an investigation of the FCPP in 2009, as part of the agency’s Power Plant Initiative. Four NGO’s also began investigating the FCPP and filed a complaint with violations of the New Source Review (NSR)/Prevention of Significant Detorioration (PSD) program in 2011 specifically alleging that APS made modifications to FCPP Units 4 and 5 in 1985, 2007 and 2008 that triggered PSD review. These NGO’s collectively were: Dine CARE, the National Parks Conservation Association, To’ Nizhoni Ani, and Sierra Club.



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Injunctive Relief and Pollutant Reductions

This settlement follows the EPA’s 2012 CAA Regional Haze Program’s Best Available Retrofit Technology (BART) determination for the FCPP. The BART determination required the installation of selective catalytic reduction systems for the control of nitrogen oxides (NO x ) at Units 4 and 5. Under BART, FCPP must continuously operate the SCR to meet a 0.098 pound/million BTU NO x emission rate. This NSR/PSD settlement will require the SCR’s to meet a 0.080 pound/ million BTU NO x emission rate, achieving an additional 887 tons per year (tpy) reduction in NO x .

The settlement will also require defendants to achieve SO 2 emissions reductions by continuously operating already installed flue gas desulfurization equipment to meet a 95 percent removal efficiency and to convert existing ductwork and stack configurations at FCPP to eliminate the bypass of stack gas around the equipment. These actions will result in SO 2 emissions of approximately 4,653 tpy.

Lastly, the settlement will require defendants to operate each Unit 4 and 5 at FCPP in a manner consistent with good air pollution control practices to maximize particulate matter emission reductions. The defendants will properly operate and maintain its existing baghouses on FCPP Unit 4 and 5 to control emissions of particulate matter. The defendants will also continuously operate the baghouses on Unit 4 and 5 so as to achieve and maintain a filterable particulate matter emission rate no greater than 0.0150 pound/million Btu. Defendants will also install and operate continuous particulate matter emissions monitors on FCPP Unit 4 and 5.

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Health Effects and Environmental Benefits

The pollutants reduced under this settlement have numerous adverse environmental and health effects. Sulfur dioxides and nitrogen oxides can be converted to fine particulate matter once in the air. Fine particulates can be breathed in and lodged deep in the lungs, leading to a variety of health problems and even premature death. Other health and environmental impacts from the pollutants addressed in this settlement include the following:

Sulfur dioxide – High concentrations of SO 2 affect breathing and may aggravate existing respiratory and cardiovascular disease. Sensitive populations include asthmatics, individuals with bronchitis or emphysema, children, and the elderly. Sulfur dioxide is also a primary contributor to acid deposition, or acid rain.

Particulate matter – Short term exposure to particulate matter can aggravate lung disease, cause asthma attacks and acute bronchitis, may increase susceptibility to respiratory infections and has been linked to heart attacks.

Nitrogen oxides – Nitrogen oxides can cause ground-level ozone, acid rain, particulate matter, global warming, water quality deterioration, and visual impairment. Nitrogen oxides play a major role, with volatile organic chemicals, in the atmospheric reactions that produce ozone. Children, people with lung diseases such as asthma, and people who work or exercise outside are susceptible to adverse effects such as damage to lung tissue and reduction in lung function.

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Environmental Mitigation Projects

The proposed consent decree requires the defendants to spend at least $6.7 million on three environmental mitigation projects and to complete the projects within five years.

Wood stove and coal

SCE will spend $3.2 to sponsor a wood-burning and coal-burning appliance replacement and/or retrofit project. This Project will replace or retrofit inefficient, higher-polluting wood-burning or coal-burning appliances with cleaner-burning, more energy-efficient heating appliances. The project must be implemented in the Navajo Nation territory and other areas which are adjacent to the FCPP.

There is a real public health and air quality need for this project on the Navajo Nation. Many Navajo households use wood or coal as the primary heating fuel. Many more use wood or coal as a supplemental heating fuel. Many stoves used on the Navajo Nation are also old. Older stoves are less efficient and lead to increased indoor and outdoor air pollution, including particulate matter 2.5, volatile organic compounds, hazardous air pollutants, carbon monoxide, and methane.

Weatherization

All defendants, except for SCE, will spend $1.5 million to sponsor a home weatherization project, which will fund projects that reduce the use of fossil fuels and biomass. Examples of such improvements include installation of floor, wall, and attic insulation; sealing of windows and doors; duct sealing; passive solar retrofits; and testing and repair of combustion appliances.

Weatherization is particularly important on the Navajo Nation because many homes on the Navajo Nation were built before 1990 and are thus likely to lack adequate insulation. Homes lacking insulation, or in need of other weatherization-related repairs, require more heating fuel to maintain a comfortable temperature, leading to additional indoor and outdoor air pollution.

Health care trust project

All defendants, except for SCE, will spend $2 million to set up a medical trust instrument established under the laws of the State of New Mexico. The trust will have a bank trustee to administer the trust locally. The trust shall be for the purpose of providing funds to pay for medical screening for impacted people living on the Navajo Nation Indian Reservation near the FCPP who require respiratory healthcare. The funds may be used to pay for complete medical examinations, tests, review of current medications, prescriptions, oxygen tanks, and other medical equipment needed for quality of life. The funds may also be used to pay for transportation to and from the hospital or doctors’ offices.

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Civil Penalty

Defendants will pay a total of $1.5 million in civil penalties to the United States.

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The proposed settlement, lodged in the U.S. District Court for New Mexico is subject to a 30-day public comment period and final court approval. Information on submitting comments is available at the Department of Justice website.

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The Power Plant Enforcement Effort

This judicial settlement secured by DOJ and EPA, is part of a national enforcement initiative to control harmful emissions from power plants under the Clean Air Act’s New Source Review requirements. The total combined sulfur dioxide and nitrogen oxides emission reductions secured from these settlements will exceed 2 million tons each year once all the required pollution controls have been installed and implemented.

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Seema Kakade

Air Enforcement Division

U. S. Environmental Protection Agency

1200 Pennsylvania Ave, NW, MC 2242A

Washington, DC 20460

(202) 564-2416

kakade.seema@epa.gov

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