Public Information Sheet Overview Pio Pico Energy Center Proposed Clean Air Act Psd Permit


United States
Environmental Protection
Agency

Summary of the Proposed Permit

On June 20, 2012, the United States Environmental Protection Agency (EPA) Region IX provided notice
of, and requested public comment on, action relating to the Prevention of Significant Deterioration (PSD)
permit application for the Pio Pico Energy Center (Project). EPA has issued a proposed permit that
would grant conditional approval, in accordance with the PSD regulations (40 CFR 52.21), to Pio Pico
Energy Center, LLC (PPEC) to construct and operate a 300 megawatt (MW, nominal) electric generating
facility. The public comment period for this proposed permit, which is ongoing, will close on July 24,

The primary equipment for the generating facility will be three General Electric (GE) LMS100 natural gas-
fired combustion turbine-generators (CTGs) with a total net generating capacity of 100 megawatts each.
The Project site is located in an unincorporated area of San Diego County known as Otay Mesa. It is
comprised of a 9.99 acre parcel located at 7363 Calzada de la Fuente in the Otay Mesa Business Park. The
site is located within the San Diego County Air Pollution Control District (SDAPCD or District).

This document is intended to provide a brief, informal summary of information to assist members of the
public attending the public hearing scheduled for July 24, 2012 for EPA's proposed PSD permit for the
Project. For official permit documents developed in accordance with 40 CFR Part 124 and more details
about the permit requirements, refer to EPA's public notice, the proposed permit, and the Fact
Sheet/Ambient Air Quality Impact Report (FACT Sheet) for this proposed permit action, which are
linked to the EPA Region 9 permit website: http: / /www.epa.gov/region09/a.ir/permit/r9-permits-
issued.html#pubcomment. The administrative record for the proposed permit may be viewed in person
at the EPA Region 9 office in San Francisco, California; for more information, or to obtain copies of
relevant documents, please contact Roger Kohn at (415) 972-3973 or via email at
R9airpermits@epa. gov.

What Laws and Regulations Apply to EPA's Proposed PSD Permit?

We have prepared this proposed permit based on our PSD regulations issued under the Clean Air Act at
40 Code of Federal Regulations (CFR) 52.21. We believe that the proposed Project will comply with PSD
requirements including the installation and operation of Best Available Control Technology (BACT), and
will not cause or contribute to a violation of the National Ambient Air Quality Standards (NAAQS) for
the pollutants regulated under the proposed permit. We have made this determination based on the
information supplied by the applicant, our review of the analyses contained in the permit application, and
other relevant information contained in the administrative record for this proposed action. EPA has
provided the proposed permit and Fact Sheet to the public for review, and will make a final decision on
the Project's PSD permit application after considering all public comments on our proposal submitted
during the public comment period.

Environmental requirements from other federal, State, or local laws are not included in EPA's proposed
PSD permit unless they are also part of the Clean Air Act PSD program. The Project is required to comply
with all other environmental requirements. To this end, PPEC also has submitted applications for State
and local pre-construction approvals, respectively referred to as an Application for Certification (AFC)
submitted to the California Energy Commission (CEC) and an application for a Determination of

2012.

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Compliance (DOC) submitted to the SDAPCD. The emissions of other air pollutants from the proposed
Project, including the pollutants for which the area is not meeting the NAAQS (and precursors that lead to
the formation of such pollutants), are regulated by the District, which implements the Nonattainment New
Source Review (NA-NSR) permitting program for this area. The District is designated as a non-
attainment area for ozone. The non-attainment pollutants subject to NA-NSR permitting by the District
include nitrogen oxides (NO^ and volatile organic compounds (VOC) as ozone precursors. On May 4,
2012, the District issued a Final DOC for the Project, which includes the District's NA-NSR permit
requirements. For power plants over 50 MW, the CEC must issue a license to authorize construction.
The District and CEC approval processes are separate from EPA's PSD permitting process

The applicant must also apply for and obtain an Acid Rain permit and a Title V operating permit from the
District for this Project. The applicant will apply for the Title V operating permit, which will incorporate
the acid rain permit, after the facility is constructed, as these permits are not required prior to construction.

What Does EPA's Proposed PSD Permit Regulate?

The PSD program (40 CFR 52.21) applies to "major" new sources of attainment pollutants. The
estimated emissions for this project show that the facility will be a major source for greenhouse gases
(GHG). Once a source is considered major for a PSD pollutant, PSD also applies to any other pollutant
regulated under the PSD program that is emitted in a significant amount. The emissions of oxides of
sulfur (SOx) will be less than the major source threshold and less than the significant emission rate.
Therefore, PSD does not apply for SOx. In addition, because the area in which the Project is located is
designated non-attainment for ozone, the PSD program does not apply to ozone and the PSD permit does
not address ozone.

In accordance with 40 CFR 52.21 (j), a new major stationary source is required to apply best available
control technology (BACT) for each PSD pollutant that it has the potential to emit (PTE) in significant
amounts. With respect to the Project, N02, PM, PM10 PM25 and GHG are emitted in significant amounts,
and therefore the proposed permit requires the Project to apply BACT to all equipment that emits these
pollutants.

How Would EPA's Proposed PSD Permit Affect Air Quality?

The PSD regulations require an examination of the impacts of the proposed Project on ambient air quality
for the pollutants regulated under the PSD permit. EPA has reviewed the computer modeling analysis that
predicts the effect of the proposed Project on ambient air quality. Based on the modeling results, and the
technical information that we have reviewed to date, the Project's impacts on air quality and visibility are
consistent with limits allowed under the Clean Air Act. The proposed emission limits will protect the
NAAQS for N02, PM10, and PM25. There are no NAAQS for PM or GHG.

The PSD regulations require that EPA evaluate other potential impacts on 1) soils and vegetation; 2)
visibility impairment; and 3) growth. Based on our review of the analyses provided by the applicant and
the maximum potential concentrations of the visibility-related criteria pollutants — N02, PM10, and PM2 5 —
we do not expect any adverse impacts on visibility, nor do we expect this project to result in any adverse
impacts on plants and soils or significant growth.

What Other Actions is EPA Taking in Connection with Its Decision making Process?

EPA has been engaged in consultation with the U.S. Fish and Wildlife Service under section 7 of the
federal Endangered Species Act (ESA) to ensure that its proposed PSD permit decision for the Project is
not likely to jeopardize the continued existence of any federally-listed endangered or threatened species or
result in the destruction or adverse modification of critical habitat for such species. EPA will proceed with

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issuance of its final PSD permit decision after making a determination that its decision will be consistent
with ESA requirements.

In addition, in accordance with Executive Order 12898, "Federal Actions to Address Environmental
Justice in Minority Populations and Low-Income Populations," EPA determined that it would be
appropriate to prepare an analysis to consider environmental justice issues in connection with the issuance
of this federal PSD permit. In our Environmental Justice Analysis, we conclude that the Project will not
cause or contribute to air quality levels in excess of health standards for the pollutants regulated under the
permit, including N02, PM10 or PM2 5 and that therefore it will not result in disproportionately high and
adverse human health or environmental effects with respect to these air pollutants on minority or low-
income populations residing near the proposed Project or the community as a whole. The Environmental
Justice Analysis is available to the public as part of the administrative record supporting EPA's proposed
PSD permit for the Project.

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