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Enron Mail |
Kenny's comments are absolutely false or, at best, grossly misleading. We
need to respond to him. The NUMBER ONE problem we have in California that is delaying our proposed power plant developments is securing ERCs. My discussions with Calpine indicate that ERCs are their biggest problem as well. (And in case someone hasn't noticed, the two most active developers in CAlifornia are Enron and Calpine.) Air quality laws are definitely slowing us down, and slowing others down, which keeps the new, cleaner plants from being developed. As I have mentioned before, this is actually making air quality worse in that the older, dirtier plants are running more. Further, if you do the math, we will probably never make up for the dirty air that is created by keeping the dirty plants in business because of grandfathering, while the clean plants don't get done because of ever more rigorous BACT standards and lack of ERCs. Having said that, I do not agree that we should send a message that we want to relax or suspend the standards. (However, getting 2ppm plants on line, which will put out of business the 100+ppm plants - as Calpine indicated to me happened in Texas - makes the point that maybe a relaxation or suspension is the environmentally appropriate thing to do.) All in all, though, I believe that sucha common sense approach will go nowhere in California because the little people in the regulatory positions as well as the public will make sure that we pay for such a message. Having said that, I will repeat the key things that we should be promoting, in my opinion: 1.) stop the EPA from tightening the BACT standards to ever increasing levels of insanity. (GE will not guarantee the present, and new, EPA requirement of 2ppm, which EPA "determined" with no new operating data. They just did it because they could.) 2.) Stop making up rules for RACT adjustments. (Kelly Brodbeck is working very hard, for example, to develop a program in the Bay Area to retrofit boats with clean burning engines to create ERCs. A high level staff guy at BAAQMD "believes" that we should be RACT adjusted, probably making the program uneconomic. There isn't even unanimity for this position on his staff. However, this position if it sticks is irresponsible in light of the fact that the boats can just keep on doing what they are doing. We are creating ERCs, which the BAAQMD will take a portion of in their haircut, and in using the ERCs, we will eventually put out of business the dirtier plants. So, our program gets RACT adjusted and the air gets dirtier...) 3.) Allow for payment of mitigation fees in lieu of buying ERCs. There is precedent for that, but this has to be run through the SIP and the EPA. Again, the in-lieu fees can be used for gov sponsored ERC developments (e.g., electric lawn mowers, electric water heaters, etc.), which will clean the air. I am aware that Sandy is working with the CA legislature on this. Go Sandy! Sandra McCubbin@ENRON 05/11/2001 09:32 AM To: Samuel Wehn/HOU/ECT@ECT, David Parquet/SF/ECT@ECT cc: Subject: California says clean air not power crisis cause so what is the problem? CARB says there isn't one! Think we need to schedule some educational meetings? ----- Forwarded by Sandra McCubbin/NA/Enron on 05/11/2001 09:30 AM ----- Mary Schoen 05/04/2001 12:37 PM To: cc: Subject: California says clean air not power crisis cause Friday, May 4, 2001 ? California regulators told congressional lawmakers on Thursday that clean air regulations are not to blame for the state's electricity shortages and said new legislation seeking to ease air quality rules was unneeded. Speaking at a House Commerce Energy and Air Quality Subcommittee hearing, the head of the California Air Resources Board repeatedly said environmental regulations should not be suspended for the sake of electricity. "Air quality laws are not interfering with California's ability to bring new generation on line and run existing power plants at maximum capacity," said Michael Kenny, executive officer of the board. When asked by Democratic lawmakers on the panel about a provision in a pending electricity bill, the California regulator said the state did not ask for a relaxation of clean air rules and did not need the change. "We believe that air quality-related sections of the legislation are unnecessary," Kenny said. Rep. Joe Barton, the Texas Republican who chairs the energy subcommittee, said the measures allow flexibility to states for the temporary suspension of environmental laws. He said the key point of his bill is to ensure the lights stay on in California this summer. The Golden State expects to face threats of blackouts starting this month, when air conditioning use accelerates. Objections raised by Kenny to the Barton bill included disagreement on a section allowing the U.S. Environmental Protection Agency to waive, when asked by a state, the requirements of the federal Clean Air Act pertaining to nitrogen oxide emissions. Kenny said the state already gives flexibility on the issue and contended the legislation would go too far and be problematic. "The waiver applies to all new generation facilities in the state and does not allow for consideration on a case-by-case (generating plant by generating plant) basis, where unique local factors can be weighed," said Kenny.
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