National Pollutant Discharge Elimination System-Final Regulations to Establish Requirements for Cooling Water Intake Structures at Phase II Existing Facilities

ENVIRONMENTAL PROTECTION AGENCY

40 CFR Parts 9, 122, 123, 124, and 125

[FRL-7625-9]

RIN 2040-AD62

National Pollutant Discharge Elimination System—Final Regulations to Establish Requirements for Cooling Water Intake Structures at Phase II Existing Facilities

AGENCY:

Environmental Protection Agency (EPA).

ACTION:

Final rule.

SUMMARY:

Today's final rule implements section 316(b) of the Clean Water Act (CWA) for certain existing power producing facilities that employ a cooling water intake structure and are designed to withdraw 50 million gallons per day (MGD) or more of water from rivers, streams, lakes, reservoirs, estuaries, oceans, or other waters of the United States for cooling purposes. This final rule constitutes Phase II of EPA's section 316(b) regulation development and establishes national requirements, and procedures for implementing those requirements, applicable to the location, design, construction, and capacity of cooling water intake structures at these facilities. The rule applies to existing facilities that, as their primary activity, both generate and transmit electric power or generate electric power but sell it to another entity for transmission. The national requirements, which will be implemented through National Pollutant Discharge Elimination System (NPDES) permits, are based on the best technology available to minimize the adverse environmental impact associated with the use of cooling water intake structures.

Today's final rule establishes performance standards that are projected to reduce impingement mortality by 80 to 95 percent and, if applicable, entrainment by 60 to 90 percent. With the implementation of today's final rule, EPA intends to minimize the adverse environmental impact of cooling water intake structures by reducing the number of aquatic organisms lost as a result of water withdrawals associated with these structures.

DATES:

This regulation is effective September 7, 2004. For judicial review purposes, this final rule is promulgated as of 1 p.m. Eastern Standard Time (EST) on July 23, 2004, as provided in 40 CFR 23.2.

ADDRESSES:

The docket for today's final rule is available for public inspection at the Water Docket in the EPA Docket Center, (EPA/DC) EPA West, Room B102, 1301 Constitution Ave., NW., Washington, DC.

FOR FURTHER INFORMATION CONTACT:

For additional technical information contact Martha Segall at (202) 566-1041 or Debra Hart at (202) 566-6379. The e-mail address for the above contacts is

rule.316b@epa.gov.

SUPPLEMENTARY INFORMATION:

I. General Information

A. What Entities Are Regulated by This Action?

This final rule applies to Phase II existing facilities that are point sources; as their primary activity both generate and transmit electric power or generate electric power for sale to another entity for transmission; use or propose to use one or more cooling water intake structures with a total design intake flow of 50 million gallons per day (MGD) or more to withdraw water from waters of the United States; and use 25 percent of water withdrawn exclusively for cooling water purposes. This rule defines “existing facility” as any facility that commenced constructions on or before January 17, 2002, and any modification of, or any addition of a unit at such a facility that does not meet the definition of a new facility at § 125.83.

This rule defines the term “cooling water intake structure” to mean the total physical structure and any associated constructed waterways used to withdraw cooling water from waters of the United States. The cooling water intake structure extends from the point at which water is withdrawn from the surface water source up to, and including, the intake pumps.

Category

Examples of regulated entities

Standard Industrial Classification (SIC) codes

North American Industry Classification System (NAICS) codes

Federal, State, and Local Government

Steam electric generating point source dischargers that employ cooling water intake structures

4911 and 493

221112, 221113, 221119, 221121, 221122

Industry

Steam electric generating industrial point source dischargers that employ cooling water intake structures (this includes utilities and nonutilities)

4911 and 493

221112, 221113, 221119, 221121, 221122

This exhibit is not intended to be exhaustive, but rather provides a guide for readers regarding entities likely to be regulated by this action. This exhibit lists the types of entities that EPA is now aware could potentially be regulated by this action. Other types of entities not listed in the exhibit could also be regulated. To determine whether your facility is regulated by this action, you should carefully examine the applicability criteria in § 125.91 of the rule. If you have questions regarding the applicability of this action to a particular entity, consult the person listed for technical information in the preceding

FOR FURTHER INFORMATION CONTACT

section.

B. How Can I Get Copies of This Document and Other Related Information?

1. Docket

EPA has established an official public docket for this action under Docket ID No. OW 2002-0049. The official public docket consists of the documents specifically referenced in this action, any public comments received, and other information related to this action. Although a part of the official docket, the public docket does not include information claimed as Confidential Business Information (CBI) or other information the disclosure of which is restricted by statute. The official public docket is the collection of materials that is available for public viewing at the Water Docket in the EPA Docket Center, (EPA/DC) EPA West, Room B102, 1301 Constitution Ave., NW., Washington, DC. The EPA Docket Center Public Reading Room is open from 8:30 a.m. to 4:30 p.m., Monday through Friday, excluding legal holidays. The telephone number for the Public Reading Room is (202) 566-1744, and the telephone number for the Water Docket is (202) 566-2426. To view docket materials,

please call ahead to schedule an appointment. Every user is entitled to copy 266 pages per day before incurring a charge. The Docket may charge 15 cents for each page over the 266-page limit plus an administrative fee of $25.00.

2. Electronic Access

You may access this

Federal Register

document electronically through the EPA Internet under the “

Federal Register

” listings at

http://www.epa.gov/fedrgstr/.

An electronic version of the public docket is available through EPA's electronic public docket and comment system, EPA Dockets. You may use EPA Dockets at

http://www.epa.gov/edocket/

to view public comments, access the index listing of the contents of the official public docket, and to access those documents in the public docket that are available electronically. Although not all docket materials may be available electronically, you may still access any of the publicly available docket materials through the docket facility identified in section I.B.1. Once in the system, select “search,” then key in the appropriate docket identification number.

C. Supporting Documentation

The final regulation is supported by three major documents:

1. Economic and Benefits Analysis for the Final Section 316(b) Phase II Existing Facilities Rule (EPA-821-R-04-005), hereafter referred to as the Economic and Benefits Analysis. This document presents the analysis of compliance costs, closures, energy supply effects, and benefits associated with the final rule.

2. Regional Analysis for the Final Section 316(b) Phase II Existing Facilities Rule (EPA-821-R-04-006), hereafter referred to as the Regional Analysis Document or the Regional Study(ies) Document. This document examines cooling water intake structure impacts and regulatory benefits at the regional level.

3. Technical Development Document for the Final Section 316(b) Phase II Existing Facilities Rule (EPA-821-R-04-007), hereafter referred to as the Technical Development Document. This document presents detailed information on the methods used to develop unit costs and describes the set of technologies that may be used to meet the final rule's requirements.

D. Table of Contents

I. General Information

A. What Entities Are Regulated By This Action?

B. How Can I Get Copies Of This Document and Other Related Information?

C. Supporting Documentation

D. Table of Contents

II. Scope and Applicability of the Final Rule

A. What is an “Existing Facility” for Purposes of the Section 316(b) Phase II Rule

B. What is “Cooling Water” and What is a “Cooling Water Intake Structure?”

C. Is My Facility Covered if it Withdraws from Waters of the United States?

D. Is My Facility Covered if it is a Point Source Discharger?

E. What Cooling Water Use and Design Intake Flow Thresholds Result in an Existing Facility Being Subject to This Rule?

III. Legal Authority, Purpose, and Background of Today's Regulation

A. Legal Authority

B. Purpose of Today's Regulation

C. Background

IV. Environmental Impacts Associated With Cooling Water Intake Structures

V. Description of the Final Rule

VI. Summary of Most Significant Revisions to the Proposed Rule

A. Data Updates

B. Regulatory Approach, Calculation Baseline, and Measuring Compliance

VII. Basis for the Final Regulation

A. Why is EPA Establishing a Multiple Compliance Alternative Approach for Determining Best Technology Available for Minimizing Adverse Environmental Impact?

B. Why and How Did EPA Establish the Performance Standards at These Levels?

C. What Is the Basis for the Five Compliance Alternatives That EPA Selected for Establishing Best Technology Available?

D. How Has EPA Assessed Economic Practicability?

E. What are the Major Options Considered for the Final Rule and Why did EPA Reject Them?

F. What is the Role of Restoration and Trading Under Today's Final Rule?

VIII. Summary of Major Comments and Responses to the Proposed Rule and Notice of Data Availability (NODA)

A. Scope and Applicability

B. Environmental Impact Associated with Cooling Water Intake Structures

C. Performance Standards

D. Site-Specific Approach

E. Implementation

F. Restoration

G. Costs

H. Benefits

I. EPA Legal Authority

IX. Implementation

A. When Does the Final Rule Become Effective?

B. What Information Must I Submit to the Director When I Apply for My Reissued NPDES Permit?

C. How Will the Director Determine the Appropriate Cooling Water Intake Structure Requirements?

D. What Will I Be Required to Monitor?

E. How Will Compliance Be Determined?

F. What Are the Respective Federal, State, and Tribal Roles?

G. Are Permits for Existing Facilities Subject to Requirements Under Other Federal Statutes?

H. Alternative Site-Specific Requirements

X. Engineering Cost Analysis

A. Technology Cost Modules

B. Model Facility Cost Development

C. Facility Flow Modifications

XI. Economic Analysis

A. Final Rule Costs

B. Final Rule Impacts

XII. Benefits Analysis

A. Introduction

B. Regional Study Design

C. The Physical Impacts of Impingement and Entrainment

D. National Benefits of Rule

E. Other Considerations

XIII. Statutory and Executive Order Reviews

A. Executive Order 12866: Regulatory Planning and Review

B. Paperwork Reduction Act

C. Regulatory Flexibility Act

D. Unfunded Mandates Reform Act

E. Executive Order 13132: Federalism

F. Executive Order 13175: Consultation and Coordination With Indian Tribal Governments

G. Executive Order 13045: Protection of Children From Environmental Health and Safety Risks

H. Executive Order 13211: Actions that Significantly Affect Energy Supply, Distribution, or Use

I. National Technology Transfer and Advancement Act

J. Executive Order 12898: Federal Actions to Address Environmental Justice in Minority Populations and Low-Income Populations

K. Executive Order 13158: Marine Protected Areas

L. Congressional Review Act

II. Scope and Applicability of the Final Rule

This rule applies to owners and operators of existing facilities, as defined in § 125.93 of today's rule that meet all of the following criteria:

• The facility's primary activity is to generate electric power. The facility either transmits the electric power itself, or sells the electric power to another entity for transmission;

• The facility is a point source that uses or proposes to use one or more cooling water intake structures, including a cooling water intake structure operated by an independent supplier that withdraws water from waters of the United States and provides cooling water to the facility by any sort of contract or other arrangement;

• The cooling water intake structure(s) withdraw(s) cooling water from waters of the United States and at least twenty-five (25) percent of the water withdrawn is used exclusively for cooling purposes measured on an average annual basis;

• The facility is a point source; and

• The cooling water intake structures have a total design intake flow of 50

million gallons per day (MGD) or greater.

In the case of a Phase II existing facility that is co-located with a manufacturing facility, only that portion of the cooling water flow that is used by the Phase II facility to generate electricity for sale to another entity will be considered when determining whether the 50 MGD and 25 percent criteria are met. Facilities subject to this final rule are referred to as “Phase II existing facilities.” Existing facilities with design flows below the 50 MGD threshold, as well as most existing manufacturing facilities, offshore seafood processors, and offshore and coastal oil and gas extraction facilities are not subject to this rule. Those facilities have different characteristics as compared to the large, power-generating facilities subject to today's rule. If an existing facility is a point source and has or is required to have an NPDES permit, but does not meet the applicability thresholds in today's rule, it is subject to permit conditions implementing section 316(b) of the CWA set by the permit director on a case-by-case basis, using best professional judgment. EPA expects to address at least some of these facilities in a separate rulemaking, referred to as Phase III.

In the preamble to the proposed rule EPA indicated that its intent was to exclude from regulation under the Phase II rule existing facilities whose primary business is manufacturing. See,

e.g.,

67 FR 17124 (April 9, 2002). At the same time, in § 125.91(a)(3) of the proposed rule, the applicability criteria covered facilities that both generate and transmit electric power, or generate electric power but sell it to another entity for transmission. Numerous commenters indicated concerns that, as proposed, § 125.91(a)(3) would not clearly exclude all existing manufacturing facilities from the Phase II rule since some facilities generate electric power primarily for their own use, but transmit or sell any surplus. Therefore, for the final rule, EPA revised § 125.91 so that it reaches only those existing facilities that generate and transmit or sell electric power as their primary activity. The final rule does not apply to existing manufacturing facilities, including manufacturing facilities that generate power for their own use and transmit any surplus power, or sell it for transmission, provided the primary activity of the facility is not electric power generation.

A. What Is an “Existing Facility” for Purposes of the Section 316(b) Phase II Rule?

In today's rule, EPA is defining the term “existing facility” to include any facility that commenced construction as described in 40 CFR 122.29(b)(4)

1

on or before January 17, 2002. EPA established January 17, 2002 as the date for distinguishing new facilities from existing ones because that is the effective date of the Phase I new facility rule. In addition, EPA is defining the term “existing facility” in this rule to include modifications and additions to such facilities, the construction of which commences after January 17, 2002, that do not meet the definition of a new facility at 40 CFR 125.83, the definition used to define the scope of the Phase I rule. That definition states:

1

Construction is commenced if the owner or operator has undertaken certain installation and site preparation activities that are part of a continuous on-site construction program, and it includes entering into certain specified binding contractual obligations as one criterion (40 CFR 122.29(b)(4)).

“

New facility

means any building, structure, facility, or installation that meets the definition of a ‘new source’ or ‘new discharger’ in [other NPDES regulations] and is a greenfield or stand-alone facility; commences construction after January 17, 2002; and uses either a newly constructed cooling water intake structure, or an existing cooling water intake structure whose design capacity is increased to accommodate the intake of additional cooling water. New facilities include only ‘greenfield’ and ‘stand-alone’ facilities. A greenfield facility is a facility that is constructed at a site at which no other source is located or that totally replaces the process or production equipment at an existing facility (see 40 CFR 122.29(b)(1)(i) and (ii). A stand-alone facility is a new, separate facility that is constructed on property where an existing facility is located and whose processes are substantially independent of the existing facility at the same site (see 40 CFR 122.29(b)(1)(iii). New facility does not include new units that are added to a facility for purposes of the same general industrial operation (for example, a new peaking unit at an electrical generating station).”

2

2

The Phase I rule also listed examples of facilities that would be “new” facilities and facilities that would “not be considered a ‘new facility’ in two numbered paragraphs. These read as follows:

“(1) Examples of ‘new facilities’ include, but are not limited to: the following scenarios:

(i) A new facility is constructed on a site that has never been used for industrial or commercial activity. It has a new cooling water intake structure for its own use.

(ii) A facility is demolished and another facility is constructed in its place. The newly-constructed facility uses the original facility's cooling water intake structure, but modifies it to increase the design capacity to accommodate the intake of additional cooling water.

(iii) A facility is constructed on the same property as an existing facility, but is a separate and independent industrial operation. The cooling water intake structure used by the original facility is modified by constructing a new intake bay for the use of the newly constructed facility or is otherwise modified to increase the intake capacity for the new facility.

(2) Examples of facilities that would not be considered a ‘new facility’ include, but are not limited to, the following scenarios:

(i) A facility in commercial or industrial operation is modified and either continues to use its original cooling water intake structure or uses a new or modified cooling water intake structure.

(ii) A facility has an existing intake structure. Another facility (a separate and independent industrial operation), is constructed on the same property and connects to the facility's cooling water intake structure behind the intake pumps, and the design capacity of the cooling water intake structure has not been increased. This facility would not be considered a ‘new facility’ even if routine maintenance or repairs that do not increase the design capacity were performed on the intake structure.”

The preamble to the final Phase I rule discusses this definition at 66 FR 65256; 65258-65259; 65285-65287, December 18, 2001.

EPA included in its Phase II proposed rule a freestanding definition of “existing facility.” That definition read as follows:

“Existing facility means any facility that commenced construction before January 17, 2002; and

(1) Any modification of such a facility;

(2) Any addition of a unit at such a facility for purposes of the same industrial operation;

(3) Any addition of a unit at such a facility for purposes of a different industrial operation, if the additional unit uses an existing cooling water intake structure and the design capacity of the intake structure is not increased; or

(4) Any facility constructed in place of such a facility, if the newly constructed facility uses an existing cooling water intake structure whose design intake flow is not increased to accommodate the intake of additional cooling water.” 67 FR 17221.

Upon further consideration, EPA has decided that it would be clearest to define existing facility primarily by stating that any facility that is not a new facility under 40 CFR 125.83 is an existing facility for purposes of this subpart. Accordingly, the language in this final rule is intended to be clear and consistent with EPA's definition of new facility in the Phase I rule at 40 CFR 125.83. In addition, the definition in today's regulation is also intended to ensure that sources excluded from the definition of new facility in the Phase I rule are captured by the definition of existing facility for the purposes of today's rule. At the same time, EPA believes that the approach taken in

today's rule is identical in terms of effect to the approach in the proposed rule. Thus, the approach taken in today's final rule is in no way intended to change the scope of the rule as compared with the proposal as far as the facilities treated as “existing” facilities under the rule. The change is in drafting technique, not in meaning.

The facility encompassed by today's regulation is the point source that uses a cooling water intake structure to generate electric power. This is because the requirements of CWA section 316(b) are implemented through NPDES permits, which are issued only to point source dischargers of pollutants to waters of the United States. A point source generating electric power would be subject to Phase I or Phase II even if the cooling water intake structure it uses is located elsewhere. Similarly, modifications or additions to the cooling water intake structure (or even the total replacement of an existing cooling water intake structure with a new one) does not convert an otherwise unchanged existing facility into a new facility, regardless of the purpose of such changes (

e.g.

, to comply with today's rule or to increase capacity). Rather, the determination as to whether a facility is new or existing focuses on the power-generating point source itself,

i.e.

, whether it is a greenfield facility or a stand-alone facility. This focus on the point source discharger is consistent with section 316(b), which by its express terms applies only to point sources.

Under this rule, an existing power generating facility that uses a cooling water intake structure and repowers by either replacing or modifying an existing generating unit would remain subject to regulation as a Phase II existing facility, unless the existing facility were completely demolished and another facility constructed in its place that used either a new intake structure or the existing structure with an increased design capacity. For example, the following facility modifications or additions would result in a facility being characterized as an existing facility under today's rule:

• An existing power generating facility undergoes a modification of its process short of total replacement of the process and concurrently increases the design capacity of its existing cooling water intake structures;

• An existing power generating facility builds a new process at its site for purposes of the same industrial operation and concurrently increases the design capacity of its existing cooling water intake structures;

• An existing power generating facility completely rebuilds its process but uses the existing cooling water intake structure with no increase in design capacity.

Phase II existing facilities subject to today's rule include point sources that do not presently use, but propose to use, cooling water intake structures and do not meet the definition of new facility at § 125.83. This is appropriate because there may be some cases in which an existing facility historically withdrew its cooling water from a municipal or other source, but then decides to withdraw cooling water from a water of the United States. In these cases, the facility may not previously have met all of the criteria applicable to an existing facility under today's rule (

i.e.

, the facility did not previously withdraw cooling waters from a water of the United States) but may make changes that would place the facility within the scope of today's rule. A comparable situation would be when a facility previously relied on units that do not require cooling water, and then adds or modifies a unit for purposes of the same industrial operation (

i.e.

, power generation) such that cooling water is subsequently required. For example, an existing power generating facility that adds a new generating unit at the same site for purposes of repowering and concurrently increases the design capacity of its existing cooling water intake structure(s), or adds a new intake structure where it did not previously need one, for example when converting a gas turbine to a combined cycle unit, would be considered an existing facility.

In the preamble to the Phase I rule, EPA noted that it had defined “existing facility” in a manner consistent with existing NPDES regulations with a limited exception. EPA noted that it had generally deferred regulation of new sources constructed on a site at which an existing source is located until the Agency had completed analysis of its survey data on existing facilities. 66 FR 65286. Accordingly, the Phase I rule treated almost all changes to existing facilities for purposes of the same industrial operation as existing facilities. These included the addition of new generating units at the same site, even where they required an increase in cooling water intake structure design capacity or the construction of a new cooling water intake structure, as well as the complete demolition of an existing facility and its replacement with a new facility, so long as it did not increase the design capacity of the cooling water intake structure. The only exception was the demolition of an existing facility and its replacement with a new facility accompanied by an increase in design capacity of the cooling water intake structure. As the preamble explained: “The definition of a new facility in the final rule applies to a facility that is repowered only if the existing facility has been demolished and another facility is constructed in its place, and modifies the existing cooling water intake structure to increase the design intake capacity.”

Id.

2a

By contrast, the Phase I rule treated the addition of a new unit for purposes of a different industrial operation as an existing facility only if it used an existing cooling water intake structure whose design intake flow was not increased.

2a

Because they are part of the same “industrial operation,” such units are not “stand-alone” facilities for purposes of the “new facility” definition. As the fifth sentence of the definition of “new facility” explains, they are categorically treated as “existing facilities” regardless of any other considerations unless they completely replace an existing facility and its cooling water design intake capacity is increased. Accordingly, there is thus no need to make a determination whether they are “substantially independent” of the existing facility at the same site under the fourth sentence of the definition in order to determine whether they are “existing” or “new facilities.” The fifth sentence alone controls that question.

The Phase II proposed rule continued this approach in its definition of “existing facility.” It continued to treat all changes to existing facilities for purposes of the same industrial operation as an existing facility unless the change was a complete demolition and replacement of the facility accompanied by an increase in cooling water intake design capacity. It also continued to treat the addition of new units for purposes of a different industrial operation differently, only allowing them to be “existing facilities” if they used an existing cooling water intake structure and did not increase its design intake flow. 67 FR 17221. In putting forth this proposed definition, EPA noted that it had collected data from a variety of sources, including survey data, specifically relating to repowering facilities.

Id.

at 17131-17135. It also made a point of explaining the wide variety of repowering activities that an existing facility could undertake under the proposed rule—anything short of demolition of an existing facility and its replacement with a new facility combined with increasing the design capacity of a cooling water intake structure—while still being regulated as an “existing facility” rather than a “new facility.”

Id.

at 17128.

On the basis of the analysis of the survey data and other information in the record, the Agency now has concluded that it should adhere to its provisional

decision generally giving wide latitude to existing facilities to make changes or additions to their facilities at the same site. In particular, new units that are added to a facility for purposes of the same general industrial operation should be treated as existing facilities because limitations associated with an existing site make it inappropriate to subject such units to new facility requirements. These limitations include space, existing location on a waterbody, location in already congested areas which could affect (if Phase 1 requirements were applied) visibility impairment, highway and airport safety issues, noise abatement issues, salt drift and corrosion problems and additional energy requirements. Moreover, power generation facilities should not be discouraged from making any upgrade, modification, or repowering that would increase energy efficiency or supply out of concern that they would be considered a new facility for purposes of section 316(b). Additional benefits will be realized in terms of reducing industrial sprawl if incremental power generation is not discouraged at existing power generation sites. These considerations counsel in favor of treating new units locating at existing sites as existing rather than new facilities. EPA also noted when it promulgated the Phase I rule (

see

66 FR 65286) that it is not feasible for the permit authority to judge whether the facility could have been located elsewhere for the purpose of determining whether the facility is subject to the new facility rules. Accordingly, EPA has decided to retain the Phase I definition's provision that a new facility does not include new units that are added to a facility for purposes of the same general industrial operation. As noted above, this decision is fully consistent with the approach to this issue laid out in the proposed Phase II rule.

The final rule definition of “existing facility” is sufficiently broad that it encompasses facilities that will be addressed under the Phase III rule (

e.g.

, existing power generating facilities with design flows below the 50 MGD threshold, certain existing manufacturing facilities, seafood processors, and offshore and coastal oil and gas extraction facilities). EPA notes, however, that these facilities are not covered under this rule because they do not meet the requirements of § 125.91.

B. What Is “Cooling Water” and What Is a “Cooling Water Intake Structure?”

Today's rule adopts for Phase II existing facilities the same definition of a “cooling water intake structure” that applies to new facilities. A cooling water intake structure is defined as the total physical structure and any associated constructed waterways used to withdraw cooling water from waters of the United States. Under the definition in today's rule, the cooling water intake structure extends from the point at which water is withdrawn from the surface water source up to, and including, the intake pumps. Today's rule adopts the new facility rule's definition of “cooling water”: Water used for contact or noncontact cooling, including water used for equipment cooling, evaporative cooling tower makeup, and dilution of effluent heat content. The definition specifies that the intended use of cooling water is to absorb waste heat rejected from the processes used, or auxiliary operations on the facility's premises. The definition also indicates that water used in a manufacturing process either before or after it is used for cooling is process water for both cooling and non-cooling purposes and would not be considered cooling water for purposes of determining whether 25 percent or more of the flow is cooling water. This clarification is necessary because cooling water intake structures typically bring water into a facility for numerous purposes, including industrial processes; use as circulating water, service water, or evaporative cooling tower makeup water; dilution of effluent heat content; equipment cooling; and air conditioning. EPA notes that this clarification does not change the fact that only the intake water used exclusively for cooling purposes is counted when determining whether the 25 percent threshold in § 125.91(a)(4) is met.

This definition of “cooling water intake structure” differs from the definition provided in the 1977 Draft Guidance for Evaluating the Adverse Impact of Cooling Water Intake Structures on the Aquatic Environment: Section 316(b) P.L. 92-500 (U.S. EPA, 1977). The final rule definition clarifies that the cooling water intake structure includes the physical structure that extends from the point at which water is withdrawn from the surface water up to and including the intake pumps. Inclusion of the term “associated constructed waterways” in today's rule is intended to clarify that the definition includes those canals, channels, connecting waterways, and similar structures that may be built or modified to facilitate the withdrawal of cooling water. The explicit inclusion of the intake pumps in the definition reflects the key role pumps play in determining the capacity (

i.e.

, dynamic capacity) of the intake. These pumps, which bring in water, are an essential component of the cooling water intake structure since without them the intake could not work as designed.

C. Is My Facility Covered if It Withdraws From Waters of the United States?

The requirements finalized today apply to cooling water intake structures that have the design capacity to withdraw amounts of water equal to or greater than the specified intake flow threshold from “waters of the United States.” Waters of the United States include the broad range of surface waters that meet the regulatory definition at 40 CFR 122.2, which includes lakes, ponds, reservoirs, nontidal rivers or streams, tidal rivers, estuaries, fjords, oceans, bays, and coves. These potential sources of cooling water may be adversely affected by impingement and entrainment.

Some facilities discharge heated water to cooling ponds, then withdraw water from the ponds for cooling purposes. EPA recognizes that cooling ponds may, in certain circumstances, constitute part of a closed-cycled cooling system. See,

e.g.

, 40 CFR 125.83. However, EPA does not intend this rule to change the regulatory status of cooling ponds. Cooling ponds are neither categorically included nor categorically excluded from the definition of “waters of the United States” at 40 CFR 122.2. EPA interprets 40 CFR 122.2 to give permit writers discretion to regulate cooling ponds as “waters of the United States” where cooling ponds meet the definition of “waters of the United States.” The determination whether a particular cooling pond is or is not a water of the United States is to be made by the permit writer on a case-by-case basis, informed by the principles enunciated in Solid Waste Agency of Northern Cook County (SWANCC) v. U.S. Army Corps of Engineers, 531 U.S. 159 (2001). Therefore, facilities that withdraw cooling water from cooling ponds that are waters of the United States and that meet today's other criteria for coverage (including the requirement that the facility has or will be required to obtain an NPDES permit) are subject to today's rule. The EPA and the U.S. Army Corps of Engineers have jointly issued jurisdictional guidance concerning the term “waters of the United States” in light of the Supreme Court's decision in Solid Waste Agency of Northern Cook County v. U.S. Army Corps of Engineers, 531 U.S. 159 (2001) (SWANCC). A copy of that guidance was published as an Appendix to an Advanced Notice of Proposed

Rulemaking on the definition of the phrase “waters of the U.S.,” see 68 FR 1991 (January 15, 2003), and may be obtained at (

http://www.epa.gov/owow/wetlands/ANPRM-FR.pdf

). Section 125.91(d) also provides, similar to the new facility rule, that facilities that obtain cooling water from a public water system or use treated effluent are not deemed to be using a cooling water intake structure for purposes of this rule.

D. Is My Facility Covered if It Is a Point Source Discharger?

Today's rule applies only to facilities that are point sources (

i.e.

, have an NPDES permit or are required to obtain one) because they discharge or might discharge pollutants, including storm water, from a point source to waters of the Unites States. This is the same requirement EPA included in the Phase I new facility rule at 40 CFR 125.81(a)(1). Requirements for complying with section 316(b) will continue to be applied through NPDES permits.

Based on the Agency's review of potential Phase II existing facilities that employ cooling water intake structures, the Agency anticipates that most existing power generating facilities that will be subject to this rule will control the intake structure that supplies them with cooling water, and discharge some combination of their cooling water, wastewater, and storm water to a water of the United States through a point source regulated by an NPDES permit. In this scenario, the requirements for the cooling water intake structure will be specified in the facility's NPDES permit. In the event that a Phase II existing facility's only NPDES permit is a general permit for storm water discharges, the Agency anticipates that the Director would write an individual NPDES permit containing requirements for the facility's cooling water intake structure. Alternatively, requirements applicable to cooling water intake structures could be incorporated into general permits. If requirements are placed into a general permit, they must meet the criteria set out at 40 CFR 122.28.

The Agency also recognizes that some facilities that have or are required to have an NPDES permit might not own and operate the intake structure that supplies their facility with cooling water. For example, electric power-generating facilities operated by separate entities might be located on the same, adjacent, or nearby property(ies); one of these facilities might take in cooling water and then transfer it to other facilities prior to discharge of the cooling water to a water of the United States. Section 125.91(c) of today's rule addresses such a situation. It provides that use of a cooling water intake structure includes obtaining cooling water by any sort of contract or arrangement with one or more independent suppliers of cooling water if the supplier or suppliers withdraw water from waters of the United States but that is not itself a Phase II existing facility. This provision is intended to prevent facilities from circumventing the requirements of today's rule by creating arrangements to receive cooling water from an entity that is not itself a Phase II existing facility.

In addressing facilities that have or are required to have an NPDES permit that do not directly control the intake structure that supplies their facility with cooling water, section 125.91(d) also provides, similar to the new facility rule, that facilities that obtain cooling water from a public water system or use treated effluent are not deemed to be using a cooling water intake structure for purposes of this rule.

As EPA stated in the preamble to the final Phase I rule (66 FR 65256 December 18, 2001), the Agency encourages the Director to closely examine scenarios in which a facility withdraws significant amounts of cooling water from waters of the United States but is not required to obtain an NPDES permit. As appropriate, the Director should apply other legal requirements, such as section 404 or 401 of the Clean Water Act, the Coastal Zone Management Act, the National Environmental Policy Act, the Endangered Species Act, or similar State or Tribal authorities to address adverse environmental impact caused by cooling water intake structures at those facilities.

E. What Cooling Water Use and Design Intake Flow Thresholds Result in an Existing Facility Being Subject to This Rule?

This final rule applies to existing facilities that are point sources and use cooling water intake structures that (1) withdraw cooling water from waters of the United States and use at least twenty-five (25) percent of the water withdrawn exclusively for cooling purposes, and (2) have a total design intake capacity of 50 MGD or more measured on an average annual basis (see § 125.91). Today's rule further provides that where a Phase II existing facility is co-located with a manufacturing facility, only that portion of the cooling water intake flow that is used by the Phase II facility to generate electricity for sale to another entity will be considered for purposes of determining whether the 50 MGD and 25 percent criteria have been exceeded.

EPA chose the 50 MGD threshold to focus the rule on the largest existing power generating facilities. EPA estimates that the 50 MGD threshold will subject approximately 543 of 902 (60 percent) existing power generating facilities to this final rule and will address approximately 90 percent of the total flow withdrawn by these facilities. EPA established the 50 MGD threshold because the regulation of existing facilities with flows of 50 MGD or greater in Phase II will address those existing power generating facilities with the greatest potential to cause or contribute to adverse environmental impact. In addition, EPA has limited data on impacts at facilities withdrawing less than 50 MGD. Deferring regulation of such facilities to Phase III provides an additional opportunity for the Agency to collect impingement and entrainment data for these smaller facilities.

Similarly, because Phase II existing facilities typically use far more than 25 percent of the water they withdraw for cooling purposes, EPA established the 25 percent threshold to ensure that nearly all cooling water and the largest existing facilities using cooling water intake structures are addressed by today's requirements. As in the Phase I rule, water used for both cooling and non-cooling purposes does not count towards the 25 percent threshold. Thus, the rule does not discourage the reuse of cooling water as process water or vice versa. Water that serves as cooling water but is either previously or subsequently used as process water is not considered cooling water for purposes of determining the percentage of the water withdrawn that is used for cooling and whether that percentage equals or exceeds 25 percent. Water withdrawn for non-cooling purposes includes water withdrawn for warming by liquified natural gas facilities and water withdrawn for public water systems by desalinization facilities.

III. Legal Authority, Purpose, and Background of Today's Regulation

A. Legal Authority

Today's final rule is issued under the authority of sections 101, 301, 304, 308, 316, 401, 402, 501, and 510 of the Clean Water Act (CWA), 33 U.S.C. 1251, 1311, 1314, 1318, 1326, 1341, 1342, 1361, and 1370. This rule partially fulfills the obligations of the U.S. Environmental Protection Agency (EPA) under a consent decree in

Riverkeeper, Inc.

v.

Leavitt,

No. 93 Civ. 0314, (S.D.N.Y).

B. Purpose of Today's Regulation

Section 316(b) of the CWA provides that any standard established pursuant to section 301 or 306 of the CWA and applicable to a point source must require that the location, design, construction, and capacity of cooling water intake structures reflect the best technology available (BTA) for minimizing adverse environmental impact. Today's rule establishes requirements reflecting the best technology available for minimizing adverse environmental impact, applicable to the location, design, construction, and capacity of cooling water intake structures at Phase II existing power generating facilities that have the design capacity to withdraw at least fifty (50) MGD of cooling water from waters of the United States and use at least twenty-five (25) percent of the water they withdraw exclusively for cooling purposes.

C. Background

1. The Clean Water Act

The Federal Water Pollution Control Act, also known as the Clean Water Act (CWA), 33 U.S.C. 1251

et seq.

, seeks to “restore and maintain the chemical, physical, and biological integrity of the nation's waters.” 33 U.S.C. 1251(a). The CWA establishes a comprehensive regulatory program, key elements of which are (1) a prohibition on the discharge of pollutants from point sources to waters of the United States, except as authorized by the statute; (2) authority for EPA or authorized States or Tribes to issue National Pollutant Discharge Elimination System (NPDES) permits that regulate the discharge of pollutants; (3) requirements for limitations in NPDES permits based on effluent limitations guidelines and standards and water quality standards.

Today's rule implements section 316(b) of the CWA as it applies to “Phase II existing facilities” as defined in this rule. Section 316(b) addresses the adverse environmental impact caused by the intake of cooling water, not discharges into water. Despite this special focus, the requirements of section 316(b) are closely linked to several of the core elements of the NPDES permit program established under section 402 of the CWA to control discharges of pollutants into navigable waters. For example, while effluent limitations apply to the discharge of pollutants by NPDES-permitted point sources to waters of the United States, section 316(b) applies to facilities subject to NPDES requirements that withdraw water from waters of the United States for cooling and that use a cooling water intake structure to do so.

Section 402 of the CWA provides authority for EPA or an authorized State or Tribe to issue an NPDES permit to any person discharging any pollutant or combination of pollutants from a point source into waters of the United States. Forty-five States and one U.S. territory are authorized under section 402(b) to administer the NPDES permitting program. NPDES permits restrict the types and amounts of pollutants, including heat, that may be discharged from various industrial, commercial, and other sources of wastewater. These permits control the discharge of pollutants primarily by requiring dischargers to meet effluent limitations established pursuant to section 301 or section 306. Effluent limitations may be based on promulgated Federal effluent limitations guidelines, new source performance standards, or the best professional judgment of the permit writer. Limitations based on these guidelines, standards, or best professional judgment are known as technology-based effluent limits. Where technology-based effluent limits are inadequate to ensure attainment of water quality standards applicable to the receiving water, section 301(b)(1)(C) of the Clean Water Act requires permits to include more stringent limits based on applicable water quality standards. NPDES permits also routinely include monitoring and reporting requirements, standard conditions, and special conditions. In addition, NPDES permits contain conditions to implement the requirements of section 316(b). Section 301 of the CWA prohibits the discharge of any pollutant by any person, except in compliance with specified statutory requirements, including section 402.

Section 510 of the Clean Water Act provides, that except as provided in the Clean Water Act, nothing in the Act shall (1) preclude or deny the right of any State or political subdivision thereof to adopt or enforce any requirement respecting control or abatement of pollution; except that if a limitation, prohibition or standard of performance is in effect under the Clean Water Act, such State or political subdivision may not adopt or enforce any other limitation prohibition or standard of performance which is less stringent than the limitation prohibition or standard of performance under the Act. EPA interprets this to reserve for the States authority to implement requirements that are more stringent than the Federal requirements under state law.

PUD No. 1 of Jefferson County. Washington Dep't of Ecology,

511 U.S. 700, 705 (1994).

Sections 301, 304, and 306 of the CWA require that EPA develop technology-based effluent limitations guidelines and new source performance standards that are used as the basis for technology-based minimum discharge requirements in wastewater discharge permits. EPA issues these effluent limitations guidelines and standards for categories of industrial dischargers based on the pollutants of concern discharged by the industry, the degree of control that can be attained using various levels of pollution control technology, consideration of various economic tests appropriate to each level of control, and other factors identified in sections 304 and 306 of the CWA (such as non-water quality environmental impacts including energy impacts). EPA has promulgated regulations setting effluent limitations guidelines and standards under sections 301, 304, and 306 of the CWA for more than 50 industries. See 40 CFR parts 405 through 471. EPA has established effluent limitations guidelines and standards that apply to most of the industry categories that use cooling water intake structures (

e.g.

, steam electric power generation, iron and steel manufacturing, pulp and paper manufacturing, petroleum refining, and chemical manufacturing).

Section 316(b) states, in full:

Any standard established pursuant to section 301 or section 306 of [the Clean Water] Act and applicable to a point source shall require that the location, design, construction, and capacity of cooling water intake structures reflect the best technology available for minimizing adverse environmental impact.

The phrase “best technology available” in CWA section 316(b) is not defined in the statute, but its meaning can be understood in light of similar phrases used elsewhere in the CWA. See

Riverkeeper

v.

EPA,

slip op. at 11 (2nd Cir. Feb. 3, 2004) (noting that the cross-reference in CWA section 316(b) to CWA section 306 “is an invitation to look to section 306 for guidance in discerning what factors Congress intended the EPA to consider in determining the ‘best technology available’ ” for new sources).

In sections 301 and 306, Congress directed EPA to set effluent discharge standards for new sources based on the “best available demonstrated control technology” and for existing sources based on the “best available technology economically achievable.” For new sources, section 306(b)(1)(B) directs EPA to establish “standards of performance.” The phrase “standards of performance” under section 306(a)(1) is defined as being the effluent reduction that is

“achievable through application of the best available demonstrated control technology, processes, operating methods or other alternatives * * *.” This is commonly referred to as “best available demonstrated technology” or “BADT.” For existing dischargers, section 301(b)(1)(A) requires the establishment of effluent limitations based on “the application of best practicable control technology currently available.” This is commonly referred to as “best practicable technology” or “BPT.” Further, section 301(b)(2)(A) directs EPA to establish effluent limitations for certain classes of pollutants “which shall require the application of the best available technology economically achievable.” This is commonly referred to as “best available technology” or “BAT.” Section 301 specifies that both BPT and BAT limitations must reflect determinations made by EPA under Clean Water Act section 304. Under these provisions, the discharge of pollutants from point sources is based not on the impact of the discharge on the receiving waters, but instead upon the capabilities of the equipment or “control technologies” available to control those discharges.

The phrases “best available demonstrated technology”; and “best available technology”—like “best technology available” in CWA section 316(b)—are not defined in the statute. However, section 304 of the CWA specifies factors to be considered in establishing the best practicable control technology currently available, and best available technology.

For best practicable control technology currently available, the CWA directs EPA to consider

the total cost of application of technology in relation to the effluent reduction benefits to be achieved from such application, and shall also take into account the age of the equipment and facilities involved, the process employed, the engineering aspects of the application of various types of control techniques, process changes, non-water quality environmental impact (including energy requirements), and such other factors as [EPA] deems appropriate.

33 U.S.C. 1314(b)(1)(b).

For “best available technology,” the CWA directs EPA to consider:

the age of equipment and facilities involved, the process employed, the engineering aspects * * * of various types of control techniques, process changes, the cost of achieving such effluent reduction, non-water quality environmental impacts (including energy requirements), and such other factors as [EPA] deems appropriate.

33 U.S.C. 1314(b)(2)(B).

Section 316(b) expressly refers to section 301, and the phrase “best technology available” is very similar to “best technology available” in that section. These facts, coupled with the brevity of section 316(b) itself, prompted EPA to look to section 301 and, ultimately, section 304 for guidance in determining the “best technology available to minimize adverse environmental impact” of cooling water intake structures for existing Phase II facilities.

By the same token, however, there are significant differences between section 316(b) and sections 301 and 304. See

Riverkeeper, Inc.

v.

United States Environmental Protection Agency,

slip op. at 13, (2nd Cir. Feb. 3, 2004) (“not every statutory directive contained [in sections 301 and 306 ] is applicable” to a section 316(b) rulemaking). Section 316(b) requires that cooling water intake structures reflect the best technology available for minimizing adverse environmental impact. In contrast to the effluent limitations provisions, the object of the “best technology available” is explicitly articulated by reference to the receiving water: To minimize adverse environmental impact in the waters from which cooling water is withdrawn. This difference is reflected in EPA's past practices in implementing sections 301, 304, and 316(b). While EPA has established effluent limitations guidelines based on the efficacy of one or more technologies to reduce pollutants in wastewater in relation to cost without necessarily considering the impact on the receiving waters, EPA has previously considered the costs of technologies in relation to the benefits of minimizing adverse environmental impact in establishing 316(b) limits which historically have been done on a case-by case basis.

In Re Public Service Co. of New Hampshire,

10 ERC 1257 (June 17, 1977);

In Re Public Service Co. of New Hampshire,

1 EAD 455 (Aug. 4, 1978);

Seacoast Anti-Pollution League

v.

Costle,

597 F. 2d 306 (1st Cir. 1979).

For this Phase II rulemaking, EPA therefore interprets CWA section 316(b) as authorizing EPA to consider not only technologies but also their effects on and benefits to the water from which the cooling water is withdrawn. Based on these two considerations, EPA has established in today's rule national requirements for facilities to install technology that is technically available, economically practicable, and cost-effective while at the same time authorizing a range of technologies that achieve comparable reductions in adverse environmental impact.

2. Consent Decree

Today's final rule partially fulfills EPA's obligation to comply with a consent decree, as amended. The Second Amended Consent Decree, which is relevant to today's rule, was filed on November 25, 2002, in the United States District Court, Southern District of New York, in

Riverkeeper, Inc.

v.

Leavitt,

No. 93 Civ 0314, a case brought against EPA by a coalition of individuals and environmental groups. The original Consent Decree, filed on October 10, 1995, provided that EPA was to propose regulations implementing section 316(b) by July 2, 1999, and take final action with respect to those regulations by August 13, 2001. Under subsequent interim orders, the Amended Consent Decree filed on November 22, 2000, and the Second Amended Consent Decree, EPA has divided the rulemaking into three phases and is working under new deadlines. As required by the Second Amended Consent Decree, on November 9, 2001, EPA took final action on a rule governing cooling water intake structures used by new facilities (Phase I). 66 FR 65255 (December 18, 2001). The Second Amended Consent Decree requires that EPA take final action by February 16, 2004, with respect to Phase II regulations that are “applicable to, at a minimum: (1) Existing utilities (

i.e.

, facilities that both generate and transmit electric power) that employ a cooling water intake structure, and whose intake flow levels exceed a minimum threshold to be determined by EPA during the Phase II rulemaking process; and (2) existing nonutility power producers (

i.e.

, facilities that generate electric power but sell it to another entity for transmission) that employ a cooling water intake structure, and whose intake flow levels exceed a minimum threshold to be determined by EPA during the Phase II rulemaking process.” The consent decree further requires that EPA propose regulations governing cooling water intake structures used, at a minimum, by smaller-flow power plants and facilities in four industrial sectors (pulp and paper making, petroleum and coal products manufacturing, chemical and allied manufacturing, and primary metal manufacturing) by November 1, 2004, and take final action by June 1, 2006 (Phase III).

3. What Other EPA Rulemakings and Guidance Have Addressed Cooling Water Intake Structures?

In April 1976, EPA published a final rule under section 316(b) that addressed cooling water intake structures. 41 FR

17387 (April 26, 1976), see also the proposed rule at 38 FR 34410 (December 13, 1973). The rule added a new § 401.14 to 40 CFR Chapter I that reiterated the requirements of CWA section 316(b). It also added a new part 402, which included three sections: (1) § 402.10 (Applicability), (2) § 402.11 (Specialized definitions), and (3) § 402.12 (Best technology available for cooling water intake structures). Section 402.10 stated that the provisions of part 402 applied to “cooling water intake structures for point sources for which effluent limitations are established pursuant to section 301 or standards of performance are established pursuant to section 306 of the Act.” Section 402.11 defined the terms “cooling water intake structure,” “location,” “design,” “construction,” “capacity,” and “Development Document.” Section 402.12 included the following language:

The information contained in the Development Document shall be considered in determining whether the location, design, construction, and capacity of a cooling water intake structure of a point source subject to standards established under section 301 or 306 reflect the best technology available for minimizing adverse environmental impact.

In 1977, fifty-eight electric utility companies challenged those regulations, arguing that EPA had failed to comply with the requirements of the Administrative Procedure Act (APA) in promulgating the rule. Specifically, the utilities argued that EPA had neither published the Development Document in the

Federal Register

nor properly incorporated the document into the rule by reference. The United States Court of Appeals for the Fourth Circuit agreed and, without reaching the merits of the regulations themselves, remanded the rule.

Appalachian Power Co.

v.

Train,

566 F.2d 451 (4th Cir. 1977). EPA later withdrew part 402. 44 FR 32956 (June 7, 1979). The regulation at 40 CFR 401.14, which reiterates the statutory requirement, remains in effect.

Since the Fourth Circuit remanded EPA's section 316(b) regulations in 1977, NPDES permit authorities have made decisions implementing section 316(b) on a case-by-case, site-specific basis. EPA published draft guidance addressing section 316(b) implementation in 1977. See

Draft Guidance for Evaluating the Adverse Impact of Cooling Water Intake Structures on the Aquatic Environment: Section 316(b) P.L. 92-500

(U.S. EPA, 1977). This draft guidance described the studies recommended for evaluating the impact of cooling water intake structures on the aquatic environment and recommended a basis for determining the best technology available for minimizing adverse environmental impact. The 1977 section 316(b) draft guidance states, “The environmental-intake interactions in question are highly site-specific and the decision as to best technology available for intake design, location, construction, and capacity must be made on a case-by-case basis.” (Section 316(b) Draft Guidance, U.S. EPA, 1977, p. 4). This case-by-case approach was also consistent with the approach described in the 1976 Development Document referenced in the remanded regulation.

The 1977 section 316(b) draft guidance suggested a general process for developing information needed to support section 316(b) decisions and presenting that information to the permitting authority. The process involved the development of a site-specific study of the environmental effects associated with each facility that uses one or more cooling water intake structures, as well as consideration of that study by the permitting authority in determining whether the facility must make any changes for minimizing adverse environmental impact. Where adverse environmental impact is present, the 1977 draft guidance suggested a stepwise approach that considers screening systems, size, location, capacity, and other factors.

Although the draft guidance described the information that should be developed, key factors that should be considered, and a process for supporting section 316(b) determinations, it did not establish uniform technology-based national standards for best technology available for minimizing adverse environmental impact. Rather, the guidance left the decisions on the appropriate location, design, capacity, and construction of cooling water intake structures to the permitting authority. Under this framework, the Director determined whether appropriate studies have been performed, whether a given facility has minimized adverse environmental impact, and what, if any, technologies may be required.

4. Phase I New Facility Rule

On November 9, 2001, EPA took final action on regulations governing cooling water intake structures at new facilities. 66 FR 65255 (December 18, 2001). On December 26, 2002, EPA made minor changes to the Phase I regulations. 67 FR 78947. The final Phase I new facility rule (40 CFR Part 125, Subpart I) establishes requirements applicable to the location, design, construction, and capacity of cooling water intake structures at new facilities that withdraw at least two (2) million gallons per day (MGD) and use at least twenty-five (25) percent of the water they withdraw solely for cooling purposes. In the new facility rule, EPA adopted a two-track approach. Under Track I, for facilities with a design intake flow more than 10 MGD, the intake flow of the cooling water intake structure is restricted, at a minimum, to a level commensurate with that which could be attained by use of a closed-cycle, recirculating cooling system. For facilities with a design intake flow more than 2 MGD, the design through-screen intake velocity is restricted to 0.5 ft/s and the total quantity of intake is restricted to a proportion of the mean annual flow of a freshwater river or stream, or to maintain the natural thermal stratification or turnover patterns (where present) of a lake or reservoir except in cases where the disruption is beneficial, or to a percentage of the tidal excursions of a tidal river or estuary. If certain environmental conditions exist, an applicant with intake capacity greater than 10 MGD must select and implement appropriate design and construction technologies for minimizing impingement mortality and entrainment. (Applicants with 2 to 10 MGD flows are not required to reduce intake flow to a level commensurate with a closed-cycle, recirculating cooling system, but must install technologies for reducing impingement mortality at all locations.) Under Track II, the applicant has the opportunity to demonstrate that impacts to fish and shellfish, including important forage and predator species, within the watershed will be comparable to the reduction in impingement mortality and entrainment it would achieve were it to implement the Track I intake flow and velocity requirements.

With the new facility rule, EPA promulgated national minimum requirements for the design, capacity, and construction of cooling water intake structures at new facilities. EPA believes that the final new facility rule establishes a reasonable framework that creates certainty for permitting of new facilities, while providing significant flexibility to take site-specific factors into account.

5. Proposed Rule for Phase II Existing Facilities

On April 9, 2002, EPA published proposed requirements for cooling water intake structures at Phase II existing facilities to implement section 316(b) of the Clean Water Act. EPA proposed to establish requirements that gave facilities three different compliance options for meeting performance standards that vary based on waterbody

type, the percentage of the source waterbody withdrawn, and the facility capacity utilization rate. 67 FR 17122. EPA received numerous comments and data submissions concerning the proposal.

6. Notice of Data Availability

On Wednesday, March 19, 2003, EPA published a Proposed Rule Notice of Data Availability (NODA). 68 FR 13522. This notice presented a summary of the data EPA had received or collected since proposal, an assessment of the relevance of the data to EPA's analysis, revisions to EPA's estimate of the costs and benefits of the proposed rule, new proposed compliance alternatives, and potential modifications to EPA's proposed regulatory approach. As part of the NODA, EPA also reopened the comment period on the complete contents of the proposed rule.

7. Public Participation

EPA has worked extensively with stakeholders from the industry, public interest groups, State agencies, and other Federal agencies in the development of this final rule. These public participation activities have focused on various section 316(b) issues, including issues relevant to development of the Phase I rule and Phase II rule.

EPA conducted outreach to industry groups, environmental groups, and other government entities in the development, testing, refinement, and completion of the section 316(b) survey, which has been used as a source of data for the Phase II rule. The survey is entitled “Information Collection Request, Detailed Industry Questionnaires: Phase II Cooling Water Intake Structures & Watershed Case Study Short Questionnaire,” September 3, 1999. In addition, EPA conducted two public meetings on section 316(b) issues. In June of 1998, in Arlington, Virginia, EPA conducted a public meeting focused on a draft regulatory framework for assessing potential adverse environmental impact from impingement and entrainment. 63 FR 27958 (May 21, 1998). In September of 1998, in Alexandria, Virginia, EPA conducted a public meeting focused on technology, cost, and mitigation issues. 63 FR 40683 (July 30, 1998). In addition, in September of 1998, and April of 1999, EPA staff participated in technical workshops sponsored by the Electric Power Research Institute on issues relating to the definition and assessment of adverse environmental impact. EPA staff have participated in other industry conferences, met upon request on numerous occasions with representatives of industry and environmental groups.

In the months leading up to publication of the proposed Phase I rule, EPA conducted a series of stakeholder meetings to review the draft regulatory framework for the proposed rule and invited stakeholders to provide their recommendations for the Agency's consideration. EPA managers have met with the Utility Water Act Group, Edison Electric Institute, representatives from an individual utility, and with representatives from the petroleum refining, pulp and paper, and iron and steel industries. EPA conducted several meetings with environmental groups attended by representatives from 15 organizations. EPA also met with the Association of State and Interstate Water Pollution Control Administrators (ASIWPCA) and, with the assistance of ASIWPCA, conducted a conference call in which representatives from 17 States or interstate organizations participated. After publication of the proposed Phase I rule, EPA continued to meet with stakeholders at their request. Summaries of these meetings are in the docket.

EPA received many comments from industry stakeholders, government agencies, and private citizens on the Phase I proposed rule 65 FR 49059 (August 10, 2000). EPA received additional comments on the Phase I Notice of Data Availability (NODA) 66 FR 28853 (May 25, 2001). These comments informed the development of the Phase II proposal.

In January, 2001, EPA also attended technical workshops organized by the Electric Power Research Institute and the Utilities Water Act Group. These workshops focused on the presentation of key issues associated with different regulatory approaches considered under the Phase I proposed rule and alternatives for addressing section 316(b) requirements.

On May 23, 2001, EPA held a day-long forum to discuss specific issues associated with the development of regulations under section 316(b) of the Clean Water Act. 66 FR 20658 (April 24, 2001). At the meeting, 17 experts from industry, public interest groups, States, and academia reviewed and discussed the Agency's preliminary data on cooling water intake structure technologies that are in place at existing facilities and the costs associated with the use of available technologies for reducing impingement and entrainment. Over 120 people attended the meeting.

In August 21, 2001, EPA staff participated in a technical symposium sponsored by the Electric Power Research Institute in association with the American Fisheries Society on issues relating to the definition and assessment of adverse environmental impact under section 316(b) of the CWA.

During development of the Phase I final rule and Phase II proposed rule, EPA coordinated with the staff from the Nuclear Regulatory Commission (NRC) to ensure that there would not be a conflict with NRC safety requirements. NRC staff reviewed the proposed Phase II rule and did not identify any apparent conflict with nuclear plant safety. NRC licensees would continue to be obligated to meet NRC requirements for design and reliable operation of cooling systems. NRC staff recommended that EPA consider adding language which states that in cases of conflict between an EPA requirement under this rule and an NRC safety requirement, the NRC safety requirement take precedence. EPA added language to address this concern in this final rule.

In a concerted effort to respond to a multitude of questions concerning the data and analyses that EPA developed as part of the Phase II proposal, EPA held a number of conference calls with multiple stakeholders to clarify issues and generally provide additional information. To supplement these verbal discussions, EPA drafted three supporting documents: one that explained the methodology EPA used to calculate entrainment rates; and two others that provided specific examples of how EPA applied this methodology to calculate benefits for the proposed rule. In addition, EPA prepared written responses to all questions submitted by the stakeholders involved in the initial conference calls.

Finally, EPA sponsored a

Symposium on Cooling Water Intake Technologies to Protect Aquatic Organisms,

held on May 6-7, 2003, at the Hilton Crystal City at National Airport in Arlington, Virginia. This symposium brought together professionals from Federal, State, and Tribal regulatory agencies; industry; environmental organizations; engineering consulting firms; science and research organizations; academia; and others concerned with mitigating harm to the aquatic environment by cooling water intake structures. Efficacy and costs of various technologies to mitigate impacts to aquatic organisms from cooling water intake structures, as well as research and other future needs, were discussed.

These coordination efforts and all of the meetings described in this section are documented or summarized in the docket established for this rule.

IV. Environmental Impacts Associated With Cooling Water Intake Structures

With the implementation of today's final rule, EPA intends to minimize the adverse environmental impacts of cooling water intake structures by minimizing the number of aquatic organisms lost as a result of water withdrawals associated with these structures or through restoration measures that compensate for these losses. In the Phase I new facility rule and proposed Phase II existing facility rule, EPA provided an overview of the magnitude and type of environmental impacts associated with cooling water intake structures, including several illustrative examples of documented environmental impacts at existing facilities (see 65 FR 49071-4; 66 FR 65262-5; and 67 FR 17136-40).

For the same reasons set forth in the preamble to the Phase I rule (66 FR 65256, 65291-65297), EPA has determined that there are multiple types of undesirable and unacceptable environmental impacts that may be associated with Phase II existing facilities, depending on conditions at the individual site. These types of impacts include entrainment and impingement; reductions of threatened and endangered species; damage to critical aquatic organisms, including important elements of the food chain; diminishment of a population's compensatory reserve; losses to populations including reductions of indigenous species populations, commercial fisheries stocks, and recreational fisheries; and stresses to overall communities and ecosystems as evidenced by reductions in diversity or other changes in system structure and function. Similarly, based on the analyses and for the same reasons set forth in the preamble to the new facility rule (66 FR 65256, 65291-65297), EPA has selected reductions in impingement and entrainment as a quick, certain, and consistent metric for determining performance at Phase II existing facilities. Further, EPA considered the non-impingement and entrainment environmental impacts for this rule and found them to be acceptable at a national level. This section describes the environmental impacts associated with cooling water withdrawals and why they are of concern to the Agency.

EPA estimates that facilities under the scope of today's final rule withdraw on average more than 214 billion gallons of cooling water a day from waters of the United States.

2

A report by the U.S. Geological Survey estimates that the use of water by the thermoelectric power industry accounted for 47 percent of all combined fresh and saline withdrawals from waters of the United States in 1995.

3

The withdrawal of such large quantities of cooling water in turn has the potential to affect large quantities of aquatic organisms including phytoplankton (tiny, free-floating photosynthetic organisms suspended in the water column), zooplankton (small aquatic animals, including fish eggs and larvae, that consume phytoplankton and other zooplankton), fish, and shellfish. Aquatic organisms drawn into cooling water intake structures are either impinged on components of the cooling water intake structure or entrained in the cooling water system itself.

2

EPA 1999. Detailed Industry Questionnaires: Phase II Cooling Water Intake Structures & Watershed Case Study Short Questionnaire. U.S. Environmental Protection Agency, Office of Wastewater Management, Washington, D.C. OMB Control No. 2040-0213.

3

Solley, W.B., R.R. Pierce and H.A. Perlman. 1998. Estimated Use of Water in the United States in 1995. U.S. Geological Survey Circular 1200.

Impingement takes place when organisms are trapped against intake screens by the force of the water being drawn through the cooling water intake structure. The velocity of the water withdrawal by the cooling water intake structure may prevent proper gill movement, remove fish scales, and cause other physical harm or death of affected organisms through exhaustion, starvation, asphyxiation, and descaling. Death from impingement (“impingement mortality”) can occur immediately or subsequently as an individual succumbs to physical damage upon its return to the waterbody.

Entrainment occurs when organisms are drawn through the cooling water intake structure into the cooling system. Organisms that become entrained are typically relatively small, aquatic organisms, including early life stages of fish and shellfish. Many of these small, fragile organisms serve as prey for larger organisms higher on the food chain which are commercially and recreationally desirable species. As entrained organisms pass through a facility's cooling system they may be subject to mechanical, thermal, and at times, chemical stress. Sources of such stress include physical impacts in the pumps and condenser tubing, pressure changes caused by diversion of the cooling water into the plant or by the hydraulic effects of the condensers, sheer stress, thermal shock in the condenser and discharge tunnel, and chemical toxic effects from antifouling agents such as chlorine. Similar to impingement mortality, death from entrainment can occur immediately or subsequently as the individual succumbs to the damage from the stresses encountered as it passed through the cooling water system once it is discharged back into the waterbody.

The environmental impacts attributable to impingement mortality and entrainment at individual facilities include losses of early life stages of fish and shellfish, reductions in forage species, and decreased recreational and commercial landings. EPA estimates that the current number of fish and shellfish, expressed as age 1 equivalents, that are killed from impingement and entrainment from cooling water intake structures at the facilities covered by this Phase II rule is over 3.4 billion annually. Expressing impingement mortality and entrainment losses as age 1 equivalents is an accepted method for converting losses of all life stages into individuals of an equivalent age and provides a standard metric for comparing losses among species, years, and facilities. The largest losses are in the mid-Atlantic, where EPA estimates 1.7 billion age 1 equivalents are lost annually due to impingement and entrainment.

4

Although the number of age 1 equivalent fish killed by impingement and entrainment is very large, precise quantification of the nature and extent of impacts to populations and ecosystems is difficult. Population dynamics and the physical, chemical, and biological processes of ecosystems are extremely complex. While generally accepted as a simple and transparent method for modeling losses, the proportional methodology that EPA uses to estimate impingement and entrainment nationwide has uncertainties that may result in under or over estimating actual impingement and entrainment rates.

4

For more information, please see Chapter D2: Evaluation of Impingement and Entrainment in the Mid-Atlantic Region in the Section 316(b) Existing Facilities Regional Studies, Part D: Mid-Atlantic.

Decreased numbers of aquatic organisms can disrupt aquatic food webs and alter species composition and overall levels of biodiversity. For example, a model that examined the effect of large entrainment losses of forage fish, such as bay anchovy, predicted subsequent reductions in predator populations (including commercially and recreationally important species such as striped bass, weakfish, and blue fish) as high as 25%.

5

This is because forage species, which comprise a majority of

entrainment losses at many facilities, are often a primary food source for predator species.

5

Summers, J.K. 1989. Simulating the indirect effects of power plant entrainment losses on an estuarine ecosystem. Ecological Modelling, 49: 31-47.

EPA is also concerned about the potential impacts of cooling water intake structures located in or near habitat areas that support threatened, endangered, or other species of concern (those species that might be in need of conservation actions, but are not currently listed as threatened or endangered under State or Federal law).

6

In the San Francisco Bay-Delta Estuary, California, in the vicinity of the Pittsburg and Contra Costa Power Plants several fish species (

e.g.

, Delta smelt, Sacramento splittail, chinook salmon, and steelhead) are now considered threatened or endangered by State and/or Federal authorities. EPA evaluated facility data on impingement and entrainment rates for these species and estimated that potential losses of special status fish species at the two facilities may average 8,386 age 1 equivalents per year resulting from impingement and 169 age 1 equivalents per year due to entrainment.

7

In another example, EPA is aware that from 1976 to 1994, approximately 3,200 threatened or endangered sea turtles entered enclosed cooling water intake canals at the St. Lucie Nuclear Generating Plant in Florida.

8

The facility developed a capture-and-release program in response to these events. Most of the entrapped turtles were captured and released alive; however, approximately 160 turtles did not survive. An incidental take limit established by NMFS in a 2001 biological opinion for this facility has been set at no more than 1,000 sea turtles captured in the intake, with less than one percent killed or injured as a result of plant operations (only two of those killed or injured may be Kemp's Ridley sea turtles and none may be hawksbill or leatherback sea turtles).

9

Although the extent to which threatened, endangered, and other special status species are taken by cooling water intake structures more generally is yet to be determined, EPA is concerned about potential impacts to such species.

6

For more information, please see Chapter A12: Threatened & Endangered Species Analysis Methods in the Regional Studies for the Final Section 316(b) Phase II Existing Facilities Rule.

7

Impingement and entrainment data were obtained from the 2000 Draft Habitat Conservation Plan for the Pittsburg and Contra Costa facilities. Please see EPA's Regional Studies for the Final Section 316(b) Phase II Existing Facilities Rule for detailed information on EPA's evaluation of impingement and entrainment at these facilities.

8

Florida Power and Light Company. 1995. Assessment of the impacts at the St. Lucie Nuclear Generating Plant on sea turtle species found in the inshore waters of Florida.

9

Florida Power and Light Company, 2002. Florida Power & Light Company St. Lucie Plant Annual Environmental Operating Report 2002.

Examples of Environmental Impacts Caused by Cooling Water Intakes

1. Hudson River

The power generation facilities on the Hudson River in New York are some of the most extensively studied in the nation. The fish populations in the Hudson River have also been studied extensively to measure the impacts of these power plants. Studies of entrainment at five Hudson River power plants during the 1980s predicted year-class reductions ranging from six percent to 79 percent, depending on the fish species.

10

A Draft Environmental Impact Statement (DEIS) prepared by industry of entrainment at three Hudson River facilities (Roseton, Bowline, and Indian Point) predicted year-class reductions of up to 20 percent for striped bass, 25 percent for bay anchovy, and 43 percent for Atlantic tomcod.

11

The New York State Department of Environmental Conservation (NYSDEC) concluded that any “compensatory responses to this level of power plant mortality could seriously deplete any resilience or compensatory capacity of the species needed to survive unfavorable environmental conditions.”

12

In the DEIS, the facilities argue that their operation has not harmed the local aquatic communities, because all observed population changes are attributable to causes other than the operation of the power plants, such as water chestnut growth, zebra mussel invasion, changes in commercial fishing, increases in salinity and improved water quality in the New York Harbor.

10

Boreman J. and P. Goodyear. 1988. Estimates of entrainment mortality for striped bass and other fish species inhabiting the Hudson River Estuary.

American Fisheries Society Monograph

4:152-160.

11

Consolidated Edison Company of New York. 2000. Draft environmental impact statement for the state pollutant discharge elimination system permits for Bowline Point, Indian Point 2 & 3, and Roseton steam electric generating stations.

12

New York State Department of Environmental Conservation (NYSDEC). 2000. Internal memorandum provided to the USEPA on NYDEC's position on SPDES permit renewals for Roseton, Bowline Point 1 & 2, and Indian Point 2 & 3 generating stations.

In contrast, the Final Environmental Impact Statement (FEIS) prepared by NYSDEC for these three facilities concludes that impacts are associated with the power plants and notes that these impacts are more like habitat degradation than the “selective cropping” of fish that occurs during regulated fishing because the entire community is impacted rather than specific species higher on the food chain.

13

The multiple facilities on the Hudson River act cumulatively on the entire aquatic community. New York State's 2002 section 316(b) report lists the Hudson River downstream from the Federal dam at Troy, New York, as impacted by cooling water use by power plants due to the loss each year of a substantial percentage of annual fish production. The FEIS estimates, from samples collected between 1981 and 1987, that the average annual entrainment losses from these three facilities includes 16.9 million American shad, 303.4 million striped bass, 409.6 million bay anchovy, 468 million white perch, and 826.2 million river herring.

14

In addition, related studies have found a small long-term decline in both species richness and diversity within the resident fish community. A commenter on the DEIS cited further evidence that Atlantic tomcod, Atlantic sturgeon, bluefish, weakfish, rainbow smelt, white perch and white catfish are showing long-term trends of declining abundance of 5 to 8% per annum.

15

Declines in abundances of several species and changes in species composition have raised concerns about the overall health of the community. The FEIS concluded that additional technology was necessary to minimize the adverse environmental impact from these three once-through systems.

16

13

New York State Department of Environmental Conservation (NYSDEC). 2003. Final Environmental Impact Statement: Concerning the Applications to Renew NYSPDES Permits for the Roseton 1 & 2, Bowling 1 & 2 and Indian Point 2 & 3 Steam Electric Generating Stations, Orange, Rockland and Westchester Counties.

14

Ibid.

15

Henderson, P.A. and R.M. Seaby. 2000. Technical comments on the Draft Environmental Impact Statement for the State Pollution Discharge Elimination System Permit Renewal for Bowline Point 1 & 2, Indian Point 2 & 3, and Roseton 1 & 2 Steam Generating Stations. Pisces Conservation Ltd.

16

New York State Department of Environmental Conservation (NYSDEC). 2003. Final Environmental Impact Statement: Concerning the Applications to Renew NYSPDES Permits for the Roseton 1 & 2, Bowline 1 & 2 and Indian Point 2 & 3 Steam Electric Generating Stations, Orange, Rockland and Westchester Counties.

The FEIS further concluded that entrainment at these facilities has diminished the forage base for each species so there is less food available for the survivors. This disruption of the food chain compromises the health of the entire aquatic community. The FEIS used, as a simplified hypothetical example, the loss of an individual bay anchovy that would ordinarily serve as prey for a juvenile striped bass. If this individual bay anchovy is killed via entrainment and disintegrated upon

passage through a CWIS, it is no longer available as food to a striped bass, but rather it is only useful as food to lower trophic level organisms, such as detritivores (organisms that feed on dead organic material). Further, the bay anchovy would no longer be available to consume phytoplankton, which upsets the distribution of nutrients in the ecosystem.

17

17

Ibid.

The Hudson River, like many waterbodies in the nation, has undergone many changes in the past few decades. These changes, which have affected fish populations either positively or negatively, include improvements to water quality as a result of upgrades to sewage treatment plants, invasions by exotic species such as zebra mussels, chemical contamination by toxins such as PCBs and heavy metals, global climate shifts such as increases in annual mean temperatures and higher frequencies of extreme weather events (

e.g.

, the El Nin

o-Southern Oscillation), and strict management of individual species stocks such as striped bass.

18

In addition, there are dramatic natural changes in fish populations on an annual basis and in the long term due to natural phenomena because the Hudson River, like many waterbodies, is a dynamic system with many fundamental, fluctuating environmental parameters—such as flow, temperature, salinity, dissolved oxygen, nutrients, and disease—that cause natural variation in fish populations each year.

19

The existence of these interacting variables makes it difficult to determine the exact contribution of impingement and entrainment losses on a population's relative health. Nonetheless, as described later in this section, EPA is concerned about the potential for cumulative impacts resulting from multiple facility intakes that collectively impinge and/or entrain aquatic organisms within a specific waterbody.

18

Ibid.

19

Ibid.

2. Mount Hope Bay

Environmental impacts were also studied in another recent permit reissuance for the Brayton Point Station in Somerset, Massachusetts, where EPA is the permitting authority. EPA determined that, among other things, the facility's cooling water system had contributed to the collapse of the fishery and inhibited its recovery despite stricter commercial and recreational fishing limits and improved water quality due to sewage treatment upgrades. The facility currently withdraws nearly one billion gallons of water each day and the average annual losses of aquatic organisms due to impingement and entrainment are estimated in the trillions, including 251 million winter flounder, 375 million windowpane flounder, 3.5 billion tautog and 11.8 billion bay anchovy. A dramatic change in the fish populations in Mount Hope Bay is apparent after 1984 with a decline by more than 87 percent, which coincides with a 45 percent increase in cooling water withdrawal from the bay due to the modification of Unit 4 from a closed-cycle recirculating system to a once-through cooling water system and a similar increase in the facility's thermal discharge.

20

21

The downward trend of finfish abundance in Mount Hope Bay is significantly greater than declines in adjacent Narragansett Bay that is not influenced by the operation of Brayton Point Station.

22

Despite fishing restrictions, fish stocks have not recovered.

20

Ibid.

21

T Gibson, M. 1995 (revised 1996). Comparison of trends in the finfish assemblages of Mt. Hope Bay and Narragansett Bay in relation to operations for the New England Power Brayton Point station. Rhode Island Division of Fish and Wildlife, Marine Fisheries Office.

22

EPA-New England. 2002. Clean Water Act NPDES Permitting Determinations for Thermal Discharge and Cooling Water Intake from Brayton Point Station in Somerset, MA (NPDES Permit No. MA 0003654), July 22, 2002.

3. Southern California Bight

At the San Onofre Nuclear Generating Station (SONGS), in a normal (non-El Niño) year, an estimated 57 tons of fish were killed per year when all units were in operation.

23

The amount lost per year included approximately 350,000 juveniles of white croaker, a popular sport fish; this number represents 33,000 adult equivalents or 3.5 tons of adult fish. In shallow water, densities of queenfish and white croaker decreased 60 percent within one kilometer of SONGS and 35 percent within three kilometers from SONGS as compared to densities prior to facility operations. Densities of local midwater fish decreased 50 to 70 percent within three kilometers of the facility. In contrast, relative abundances of some bottom-dwelling species in the same areas were higher because of the enriched nature of the SONGS discharge, which in turn supported elevated numbers of prey items for bottom-dwelling fish.

23

Murdoch, W.W., R.C. Fay, and B.J. Mechalas. 1989. Final Report of the Marine Review Committee to the California Coastal Commission. August 1989, MRC Document No. 89-02.

4. Missouri River

In contrast to these examples, facilities sited on waterbodies previously impaired by anthropogenic activities such as channelization demonstrate limited entrainment and impingement losses. The Neal Generating Complex facility, located near Sioux City, Iowa, on the Missouri River is coal-fired and utilizes once-through cooling systems. According to a ten-year study conducted from 1972-82, the Missouri River aquatic environment near the Neal complex was previously heavily impacted by channelization and very high flow rates meant to enhance barge traffic and navigation.

24

These anthropogenic changes to the natural river system resulted in significant losses of fish habitat. At this facility, there was found to be little impingement and entrainment by cooling water intakes.

24

Tondreau, R., J. Hey and E. Shane, Morningside College. 1982. Missouri River Aquatic Ecology Studies: Ten Year Summary (1972-1982). Prepared for Iowa Public Service Company, Sioux City, Iowa.

Studies like those described in this section provide only a partial picture of the range of environmental impacts associated with cooling water intake structures. Although numerous studies were conducted to determine the environmental impacts caused by impingement and entrainment at existing facilities, many of them are based on limited data that were collected as long as 25 years ago. EPA's review of available facility impingement and entrainment studies identified a substantial number of serious study design limitations, including data collections for only one to two years or limited to one season and for a subset of the species affected by cooling water intakes; limited taxonomic detail (

i.e.

, many losses not identified to the species level); a general lack of statistical information such as inclusion of variance measures in impingement and entrainment estimates; and the lack of standard methods and metrics for quantifying impingement and entrainment, which limits the potential for evaluating cumulative impacts across multiple facilities. Further, in many cases it is likely that facility operating conditions and/or the state of the waterbody itself has changed since these studies were conducted. Finally, the methods for monitoring impingement and entrainment used in the 1970s and 1980s, when most section 316(b) evaluations were performed, were often inconsistent and incomplete, making quantification of impacts difficult in some cases. Recent advances in environmental assessment techniques

provide new and in some cases better tools for monitoring impingement and entrainment and quantifying the current magnitude of the impacts.

25 26

25

Schmitt, R.J. and C.W. Osenberg. 1996. Detecting Ecological Impacts. Academic Press, San Diego, CA.

26

EPRI 1999. Catalog of Assessment Methods for Evaluating the Effects of Power Plant Operations on Aquatic Communities. TR-112013, EPRI, Palo Alto, CA.

EPA is also concerned about the potential for cumulative impacts related to cooling water withdrawal. Cumulative impacts may result from (1) multiple facility intakes impinging and/or entraining aquatic organisms within a specific waterbody, watershed, or along the migratory pathway of specific species; (2) the existence of multiple stressors within a waterbody/watershed, including cooling water intake withdrawals; and (3) long-term occurrences of impingement and/or entrainment losses that may result in the diminishment of the compensatory reserve of a particular fishery stock.

Historically, environmental impacts related to cooling water intake structures have been evaluated on a facility-by-facility basis. These historical evaluations do not consider the potential for a fish or shellfish species to be concomitantly impacted by cooling water intake structures belonging to other facilities that are located within the same waterbody or watershed in which the species resides or along the coastal migratory route of a particular species. The potential cumulative effects of multiple intakes located within a specific waterbody or along a coastal segment are difficult to quantify and are not typically assessed. (One relevant example is provided for the Hudson River; see discussion earlier in this section.) Nonetheless, EPA analyses suggest that almost a quarter of all Phase II existing facilities are located on a waterbody with another Phase II existing facility (DCN 4-4009). Thus, EPA is concerned that although the potential for aquatic species to be affected by cooling water withdrawals from multiple facility intakes is high, this type of cumulative impact is largely unknown and has not adequately been accounted for in evaluating impacts. However, recently the Atlantic States Marine Fisheries Commission (ASMFC) was requested by its member States to investigate the cumulative impacts on commercial fishery stocks, particularly overutilized stocks, attributable to cooling water intakes located in coastal regions of the Atlantic.

27

Specifically, the ASMFC study will evaluate the potential cumulative impacts of multiple intakes on Atlantic menhaden stock

28

which range along most of the U.S. Atlantic coast with a focus on revising existing fishery management models so that they accurately consider and account for fish losses from multiple intake structures. Results from these types of studies, although currently unavailable, will provide significant insight into the degree of impact attributable to intake withdrawals from multiple facilities.

27

Personal communication, D. Hart (EPA) and L. Kline (ASMFC), 2001.

28

Personal communication, D. Hart (EPA) and L. Kline (ASMFC), 2003.

EPA also considered information suggesting that impingement and entrainment, in conjunction with other factors, may be a nontrivial stress on a waterbody. EPA recognizes that cooling water intake structures are not the only source of human-induced stress on aquatic systems. Additional stresses to aquatic systems include, but are not limited to, nutrient, toxics, and sediment loadings; low dissolved oxygen; habitat loss; and stormwater runoff. Although EPA recognizes that a nexus between a particular stressor and adverse environmental impact may be difficult to establish with certainty, EPA believes stressors that cause or contribute to the loss of aquatic organisms and habitat such as those described above, may incrementally impact the viability of aquatic resources. EPA analyses suggest that over 99 percent of all existing facilities with cooling water withdrawal that EPA surveyed in its section 316(b) survey of existing facilities are located within two miles of waters that are identified as impaired by a State or Tribe (see 66 FR 65256, 65297). Thus, the Agency is concerned that to the extent that many of the aquatic organisms subject to the effects of cooling water withdrawals reside in impaired waterbodies, they are potentially more vulnerable to cumulative impacts from an array of physical and chemical anthropogenic stressors.

Finally, EPA believes that an aquatic population's potential compensatory ability—the capacity for a species to increase its survival, growth, or reproduction in response to reductions sustained to its overall population size—may be compromised by impingement and entrainment losses in conjunction with all the other stressors encountered within a population's natural range, as well as impingement and entrainment losses occurring consistently over extended periods of time. As discussed in the Phase I new facility rule (see 66 FR 65294), EPA is concerned that even if there is little evidence that cooling water intakes alone reduce a population's compensatory reserve, the multitude of stressors experienced by a species can potentially adversely affect its ability to recover.

29

Moreover, EPA notes that the opposite effect or “depensation” (decreases in recruitment as stock size declines

30

) may occur if a population's size is reduced beyond a critical threshold. Depensation can lead to further decreases in population abundances that are already seriously depleted and, in some cases, recovery of the population may not be possible even if the stressors are removed. In fact, there is some evidence that depensation may be a factor in some recent fisheries collapses.

31

32

33

29

Hutchings, J.A. and R.A. Myers. 1994. What can be learned from the collapse of a renewable resource? Atlantic cod,

Gadus morhus,

of Newfoundland and Labrador. Canadian Journal of Fisheries and Aquatic Sciences 51:2126-2146.

30

Goodyear, C.P. 1977. Assessing the impact of power plant mortality on the compensatory reserve of fish populations. Pages 186-195 in W. Van Winkle, ed., Proceedings of the Conference on Assessing the Effects of Power Plant Induced Mortality on Fish Populations. Pergamon Press, New York, NY.

31

Myers, R.A., N.J. Barrowman, J.A. Hutchings, and A.A. Rosenburg. 1995. Population dynamics of exploited fish stocks at low population levels. Science 26:1106-1108.

32

Hutchings, J.A. and R.A. Myers. 1994. What can be learned from the collapse of a renewable resource? Atlantic cod,

Gadus morhus,

of Newfoundland and Labrador. Canadian Journal of Fisheries and Aquatic Sciences 51:2126-2146.

33

Liermann, M. and R. Hilborn. 1997. Depensation in fish stocks: A hierarchic Bayesian meta-analysis. Can. J. Fish. Aquatic. Sci. 54:1976-1985.

Another problem associated with assessing the environmental impact of cooling water intakes is that existing fishery resource baselines may be inaccurate.

34

There is much evidence that the world's fisheries are in general decline,

35

36

however, many fishery stocks have not been adequately assessed. According to a 2002 study, only 23 percent of U.S. managed fish stocks have been fully assessed and of these, over 40 percent are considered depleted or are being fished beyond sustainable levels.

37

Another study estimated that more than 70 percent of commercial fish stocks are fully

exploited, overfished or collapsed.

38

Another estimated that large predatory fish stocks are only a tenth of what they were 50 years ago.

39

Most studies of fish populations last only a few years, do not encompass the entire life span of the species examined, and do not account for cyclical environmental changes such as ENSO events, and other long term cycles of oceanographic productivity.

40

34

Watson, R. and D. Pauly. 2001. Systematic distortions in world fisheries catch trends. Nature 414:534-536.

35

Ibid.

36

Pew Oceans Commission. 2003. America's Living Oceans: Charting a course for sea change. Summary Report. May 2003. Pew Oceans Commission, Arlington, VA.

37

U.S. Commission on Ocean Policy. 2002. Developing a National Ocean Policy: Mid-Term Report of the U.S. Commission on Ocean Policy. Washington, DC.

38

Broad, W.J. and A.C. Revkin. 2003. Has the Sea Given Up its Bounty? The New York Times. July 29, 2003.

39

Myers, R.A. and B. Worm. 2003. Rapid worldwide depletion of predatory fish communities. Nature 423: 280-283.

40

Jackson, J.B.C., M.X. Kirby, W.H. Berger, K.A. Bjorndal, L.W. Botsford, B.J. Bourque, R.H. Bradbury, R. Cooke, J. Erlandson, J.A. Estes, T.P. Hughes, S. Kidwell, C.B. Lange, H.S. Lenihan, J.M. Pandolfi, C.H. Peterson, R.S. Steneck, M.J. Tegner, and R.R. Warner. 2001. Historical overfishing and the recent collapse of coastal ecosystems. Science 293(5530):629-638.

Although a clear and detailed picture of the status of all our fishery resources does not exist,

41

it is undisputed that fishermen are struggling to sustain their livelihood despite strict fishery management restrictions which aim to rebuild fish populations. EPA shares the concerns expressed by expert fishery scientists that historical overfishing has increased the sensitivity of aquatic ecosystems to subsequent disturbance, making them more vulnerable to other stressors, including cooling water intake structures.

41

National Marine Fisheries Service (NMFS). 2002. Annual Report to Congress on the Status of U.S. Fisheries—2001. U.S. Dep. Commerce, NOAA, Natl. Mar. Fish. Serv., Silver Spring, MD, 142 pp.

In conclusion, EPA's mission includes ensuring the sustainability of communities and ecosystems. Thus, EPA must comprehensively evaluate all potential threats to resources and work towards eliminating or reducing identified threats. As discussed in this section, EPA believes that impingement and entrainment losses attributable to cooling water intakes do pose a threat to aquatic organisms and through today's rule is seeking to minimize that threat.

V. Description of the Final Rule

Clean Water Act section 316(b) requires that any standard established pursuant to section 301 or section 306 of the CWA and applicable to a point source shall require that the location, design, construction, and capacity of cooling water intake structures reflect the best technology available for minimizing adverse environmental impact. Today's final rule establishes national performance requirements for Phase II existing facilities that ensure such facilities fulfill the mandate of section 316(b).

This rule applies to Phase II existing facilities that use or propose to use a cooling water intake structure to withdraw water for cooling purposes from waters of the United States and that have or are required to have a National Pollutant Discharge Elimination System (NPDES) permit issued under section 402 of the CWA. Phase II existing facilities include only those facilities whose primary activity is to generate and transmit electric power and who have a design intake flow of 50 MGD or greater, and that use at least 25 percent of the water withdrawn exclusively for cooling purposes (see § 125.91). Applicability criteria for this rule are discussed in detail in section II of this preamble.

Under this final rule, EPA has established performance standards for the reduction of impingement mortality and, when appropriate, entrainment (see § 125.94). The performance standards consist of ranges of reductions in impingement mortality and/or entrainment (

e.g.

, reduce impingement mortality by 80 to 95 percent and/or entrainment by 60 to 90 percent). These performance standards reflect the best technology available for minimizing adverse environmental impacts determined on a national categorical basis. The type of performance standard applicable to a particular facility (

i.e.

, reductions in impingement only or impingement and entrainment) is based on several factors, including the facility's location (

i.e.

, source waterbody), rate of use (capacity utilization rate), and the proportion of the waterbody withdrawn. Exhibit V-1 summarizes the performance standards based on waterbody type.

In most cases, EPA believes that these performance standards can be met using design and construction technologies or operational measures. However, under the rule, the performance standards also can be met, in whole or in part, by using restoration measures, following consideration of design and construction technologies or operational measures and provided such measures meet restoration requirements (see § 125.94(c)).

As noted earlier in this section, today's rule generally requires that impingement mortality of all life stages of fish and shellfish must be reduced by 80 to 95 percent from the calculation baseline; and for some facilities, entrainment of all life stages of fish and shellfish must be reduced by 60 to 90 percent from the calculation baseline (see § 125.94(b)).

Exhibit V-1.—Performance Standard Requirements

Waterbody type

Capacity utilization rate

Design intake flow

Type of performance standard

Freshwater River or Stream

Less than 15%

N/A

1

Impingement mortality only.

Equal to or greater than 15%

5% or less mean annual flow

Impingement mortality only.

Greater than 5% of mean annual flow

Impingement mortality and entrainment.

Tidal river, Estuary or Ocean

Less than 15%

N/A

1

Impingement mortality only.

Equal to or greater than 15%

N/A

Impingement mortality and entrainment.

Great Lakes

Less than 15%

N/A

Impingement mortality only.

Equal to or greater than 15%

N/A

Impingement mortality and entrainment.

Lakes or Reservoirs

N/A

Increase in design intake flow must not disrupt thermal stratification except where it does not adversely affect the management of fisheries

Impingement mortality only.

1

Determination of appropriate compliance reductions is not applicable.

This final rule identifies five alternatives a Phase II existing facility may use to achieve compliance with the requirements for best technology available for minimizing adverse environmental impacts associated with cooling water intake structures. Four of these are based on meeting the applicable performance standards and the fifth allows the facility to request a site-specific determination of best technology available for minimizing adverse environmental impacts under certain circumstances. EPA has established these compliance alternatives for meeting the performance standards to provide a significant degree of flexibility to Phase II existing facilities, to ensure that the rule requirements are economically practicable, and to provide the ability for Phase II existing facilities to address unique site-specific factors. Application requirements vary based on the compliance alternative selected and, for some facilities, include development of a Comprehensive Demonstration Study. Application requirements are discussed later in this section. The five compliance alternatives are described in the following paragraphs.

Under § 125.94(a)(1)(i) and (ii), a Phase II existing facility may demonstrate to the Director that it has already reduced its flow commensurate with a closed-cycle recirculating system, or that it has already reduced its design intake velocity to 0.5 ft/s or less. If a facility can demonstrate to the Director that it has reduced, or will reduce, flow commensurate with a closed-cycle recirculating system, the facility is deemed to have met the performance standards to reduce impingement mortality and entrainment (see § 125.94 (a)(1)(i)). Those facilities would not be required to submit a Comprehensive Demonstration Study with their NPDES application. If the facility can demonstrate to the Director that is has reduced, or will reduce maximum through-screen design intake velocity to 0.5 ft/s or less, the facility is deemed to have met the performance standards to reduce impingement mortality only. Facilities that meet the velocity requirements would only need to submit application studies related to determining entrainment reduction, if subject to the performance standards for entrainment.

Under § 125.94(a)(2) and (3), a Phase II existing facility may demonstrate to the Director, either that its current cooling water intake structure configuration meets the applicable performance standards, or that it has selected design and construction technologies, operational measures, and/or restoration measures that, in combination with any existing design and construction technologies, operational measures, and/or restoration measures, meet the specified performance standards in § 125.94(b) and/or the requirements in § 125.94(c).

Under § 125.94(a)(4), a Phase II existing facility may demonstrate to the Director that it has installed and is properly operating and maintaining a rule-specified and approved design and construction technology in accordance with § 125.99(a). Submerged cylindrical wedgewire screen technology is a rule-specified design and construction technology that may be used in instances in which a facility's cooling water intake structure is located in a freshwater river or stream and meets other criteria specified at § 125.99(a).

In addition, under this compliance alternative, a facility or other interested person may submit a request to the Director for approval of a different technology. If the Director approves the technology, it may be used by all facilities with similar site conditions under his or her jurisdiction if allowed under the State's administrative procedures. Requests for approval of a technology must be submitted to the Director and include a detailed description of the technology; a list of design criteria for the technology and site characteristics and conditions that each facility must possess in order to ensure that the technology can consistently meet the appropriate impingement mortality and entrainment performance standards in § 125.94(b); and information and data sufficient to demonstrate that all facilities under the jurisdiction of the Director can meet the relevant impingement mortality and entrainment performance standards in § 125.94(b) if the applicable design criteria and site characteristics and conditions are present at the facility. A Director may only approve an alternative technology following public notice and opportunity for comment on the approval of the technology (§ 125.99(b)).

Under § 125.94(a)(5) (i) or (ii), if the Director determines that a facility's costs of compliance would be significantly greater than the costs considered by the Administrator for a like facility to meet the applicable performance standards, or that the costs of compliance would be significantly greater than the benefits of meeting the applicable performance standards at the facility, the Director must make a site-specific determination of best technology available for minimizing adverse environmental impact. Under this alternative, a facility would either compare its projected costs of compliance using a particular technology or technologies to the costs the Agency considered for a like facility in establishing the applicable performance standards, or compare its projected costs of compliance with the projected benefits at its site of meeting the applicable performance standards of today's rule (see section IX.H). If in either case costs are significantly greater, the technology selected by the Director must achieve an efficacy level that comes as close as practicable to the applicable performance standards without resulting in significantly greater costs.

During the first permit term, a facility that chooses compliance alternatives in § 125.94(a)(2), (3), (4), or (5) may request that compliance with the requirements of this rule be determined based on the implementation of a Technology Installation and Operation Plan indicating how the facility will install and ensure the efficacy, to the extent practicable, of design and construction

technologies and/or operational measures, and/or a Restoration Plan (§ 125.95(b)(5)). The Technology Installation and Operation Plan must be developed and submitted to the Director in accordance with § 125.95(b)(4)(ii). The Restoration Plan must be developed in accordance with § 125.95(b)(5). During subsequent permit terms, if the facility has been in compliance with the construction, operational, maintenance, monitoring, and adaptive management requirements in its TIOP and/or Restoration Plan during the preceding permit term, the facility may request that compliance during subsequent permit terms be based on its remaining in compliance with its TIOP and/or Restoration Plan, revised in accordance with applicable adaptive management requirements if the applicable performance standards are not being met.

Three sets of data are required to be submitted 180 days prior to expiration of a facility's existing permit by all facilities regardless of compliance alternative selected (see § 122.21(r)(2)(3) and (5)). These are:

• Source Water Physical Data: A narrative description and scaled drawings showing the physical configuration of all source waterbodies used by the facility, including areal dimensions, depths, salinity and temperature regimes, and other documentation that supports your determination of the waterbody type where each cooling water intake structure is located; identification and characterization of the source waterbody's hydrological and geomorphological features, as well as the methods used to conduct any physical studies to determine the intake's area of influence and the results of such studies; and locational maps.

• Cooling Water Intake Structure Data: A narrative description of the configuration of each of its facility's cooling water intake structures and where it is located in the waterbody and in the water column; latitude and longitude in degrees, minutes, and seconds for each of its cooling water intake structures; a narrative description of the operation of each of its cooling water intake structures, including design intake flows, daily hours of operation, number of days of the year in operation, and seasonal changes, if applicable; a flow distribution and water balance diagram that includes all sources of water to the facility, recirculating flows, and discharges; and engineering drawings of the cooling water intake structure.

• Cooling Water System Data: A narrative description of the operation of each cooling water system, its relationship to the cooling water intake structures, proportion of the design intake flow that is used in the system, the number of days of the year the system is in operation, and seasonal changes in the operation of the system, if applicable; and engineering calculations and supporting data to support the narrative description.

In addition to the specified data facilities are require to submit, some facilities are also required to conduct a Comprehensive Demonstration Study. Specific requirements for the Comprehensive Demonstration Study vary based on the compliance alternative selected. Exhibit II summarizes the Comprehensive Demonstration Study requirements for each compliance alternative. Specific details of each Comprehensive Demonstration Study component are provided in section IX of this preamble.

Exhibit V-2.—Summary of Comprehensive Demonstration Study Requirements for Compliance Alternatives

Compliance alternative (§ 125.94(b))

Comprehensive demonstration study requirements (§ 125.95(b))

1—Demonstrate facility has reduced flow commensurate with closed-cycle recirculating system

None.

1—Demonstrate facility has reduced design intake velocity to ≤ 0.5 ft/s

No requirements relative to impingement mortality reduction. If subject to entrainment performance standard, the facility must only address entrainment in the applicable components of its Comprehensive Demonstration Study, based on the compliance option selected for entrainment reduction.

2—Demonstrate that existing design and construction technologies, operational measures, and/or restoration measures meet the performance standards

Proposal for Information Collection.

Source Waterbody Flow Information.

Impingement Mortality and/or Entrainment Characterization Study (as appropriate).

Technology and Compliance Assessment Information

—Design and Construction Technology Plan

—Technology Installation and Operation Plan

Restoration Plan (if appropriate).

Verification Monitoring Plan.

3—Demonstrate that facility has selected design and construction technologies, operational measures, and/or restoration measures that will, in combination with any existing design and construction technologies, operational measures, and/or restoration measures, meet the performance standards

Proposal for Information Collection.

Source Waterbody Flow Information.

Impingement Mortality and/or Entrainment Characterization Study (as appropriate).

Technology and Compliance Assessment Information

—Design and Construction Technology Plan

—Technology Installation and Operation Plan

Restoration Plan (if appropriate).

Verification Monitoring Plan.

4—Demonstrate that facility has installed and properly operates and maintains an approved technology

Technology Installation and Operation Plan.

Verification Monitoring Plan.

5—Demonstrate that a site-specific determination of BTA is appropriate

Proposal for Information Collection.

Source Waterbody Flow Information.

Impingement Mortality and/or Entrainment Characterization Study (as appropriate).

Technology Installation and Operation Plan.

Restoration Plan (if appropriate).

Information to Support Site Specific Determination of BTA including:

—Comprehensive Cost Evaluation Study (cost-cost test and cost-benefit test);

—Valuation of Monetized Benefits of Reducing IM&E (cost-benefit test only);

—Site-Specific Technology Plan (cost-cost test and cost-benefit test);

Verification Monitoring Plan.

The requirements in today's final rule are implemented through NPDES permits issued under section 402 of the CWA. Permit applications submitted after the effective date of the rule must fulfill rule requirements. However, facilities whose existing permit expires before [insert four years after date of publication in the FR], may request a schedule for submission of application materials that is as expeditious as practicable but does not exceed [insert three years and 180 days after date of publication in the FR], to provide sufficient time to perform the required information collection requirements. Phase II existing facilities must comply with this final rule when they become subject to an NPDES permit containing these requirements.

Finally, today's rule preserves each State's right to adopt or enforce more stringent requirements (see § 125.90(d)). It also provides that if a State demonstrates to the Administrator that it has adopted alternative regulatory requirements in its NPDES program that will result in environmental performance within a watershed that is comparable to the reductions of impingement mortality and entrainment that would otherwise be achieved under § 125.94, the Administrator must approve such alternative regulatory requirements (§ 125.90(c)).

VI. Summary of Most Significant Revisions to the Proposed Rule

A. Data Updates

Based on comments received, additional information made available, and the results of subsequent analyses, EPA revised a number of assumptions that were used in developing the engineering costs, the information collection costs, the economic analyses, and the benefits analyses. These new assumptions are presented below and were used in the analyses in support of this final rule.

1. Number of Phase II Facilities

Since publishing the NODA, EPA continued to verify design flow information for facilities that had been classified as either Phase II (large, existing power production) or Phase III (smaller, power producing or manufacturing) facilities. This verification resulted in the following changes: One facility that was classified as a Phase II facility at proposal was reclassified as being out of scope of the section 316(b) regulation, as it ceased operating. Four facilities that were classified as Phase III facilities at proposal based on projected design intake flow were reclassified as Phase II facilities. As a result, the overall number of Phase II facilities increased from 540 to 543 facilities.

42

For the final rule, all costs, benefits, and economic analyses are based on the updated set of Phase II facilities.

42

Note that these numbers are unweighted. [As with many surveys, EPA was able to obtain data from most, but not all of the facilities potentially subject to this rule. To estimate the characteristics for those facilities that were not surveyed, EPA assigned a statistically derived sample weight to those facilities for which data were collected.] On a sample-weighted basis, the number of Phase II facilities increased from 551 to 554. The number of Phase II facilities modeled by the Integrated Planning Model (IPM) increased from 531 to 535.

The reason for the change is that the Agency revised the estimated design intake flows for facilities that responded to the short-technical questionnaire EPA used to collect information for this rule. The Agency has now adopted a more robust set of annual flow data (using all the years of data collected for the final rule, rather than only flows for 1998 as reported at proposal). This change altered the calculated design intake flows for the facilities that provided responses to the short-technical questionnaire that EPA used to collect data. Facilities that provided responses to the detailed questionnaire were unaffected, as the Agency collected maximum design intake flows directly through the detailed questionnaire.

2. Technology Costs

Since publishing the NODA, EPA used new information to revise the capital and operation and maintenance (O&M) costs for several compliance technologies, including those used as the primary basis for the final rule. Overall, the cost updates resulted in the following changes: total capital costs decreased by 5 percent and total operation and maintenance costs decrease by 3 percent. These comparisons are based on the raw costs, adjusted to year-2002 dollars, which have not been discounted or annualized.

43

The revised costing assumptions are discussed in detail in section VI.3.

43

Based on additional research conducted after NODA publication and prior to issuance of the final rule, EPA changed the projected compliance response for some facilities. These changes, together with the increase in the number of in-scope Phase II facilities, contributed to the change in total compliance costs.

3. Permitting and Monitoring Costs

Since proposal, EPA made several corrections and revisions to its burden and cost estimates for implementing the information collection requirements of today's rule, based on comments received and additional analysis. The following corrections and revisions were made since proposal:

• EPA corrected the hourly rates for the statistician and biological technician labor categories, which were inadvertently transposed at proposal.

• EPA increased the burdens associated with impingement and entrainment monitoring for the Impingement Mortality and Entrainment Characterization Study.

• EPA revised the pilot study costs to assume that only a subset of facilities which are projected to install new technologies will perform pilot studies, and to be proportional to the projected capital costs for installing these new technologies in order to comply with the rule. EPA also developed an alternative national cost estimate using slightly different assumptions with regard to pilot study costs (see section XI).

• EPA adjusted the facility-level costs to account for facilities that were projected to demonstrate compliance through the installation of a wedge-wire screen in a freshwater river under the compliance alternative in 125.94(a)(4).

4. Net Installation Downtime for Non-recirculating Cooling Tower Compliance Technologies

In developing the proposal for this rule, the Agency estimated that technologies other than recirculating cooling towers would not require installation downtime for construction. However, the Agency amended this outlook for the NODA and published revised estimates of net construction downtimes for complying facilities installing a subset of technologies analyzed and developed as candidates for best technology available (BTA). Based on comments received on the NODA, the Agency has conducted further research into the construction downtimes that it used in the NODA for certain technologies. For the final regulation analysis, the Agency has adopted minor revisions to the construction downtimes for certain technologies, with the general effect being an increase in the net construction downtimes for a few technologies that the Agency views as candidates for reducing entrainment. (Net downtime was estimated by subtracting 4 weeks from total downtime, based on an assumption that facilities will schedule construction downtime during a 4 week period of normal downtime unrelated to the rule, for example, for routine maintenance.) As such, the Agency projects that a significant number of facilities expected to comply with the entrainment reduction requirements of the rule will have increased downtime costs compared to the NODA and the proposal analyses. The final costs of this rule reflect these changes, which are further discussed in Section X and the Technical Development Document.

B. Regulatory Approach, Calculation Baseline, and Measuring Compliance

1. Regulatory Approach

EPA has largely adopted the proposed rule with some restructuring and one significant change: an additional compliance alternative, the approved technology option (§ 125.94(a)(4)) which was discussed in detail in the NODA (68 FR 13539). The restructuring of the rule language now makes the reduction of flow commensurate with a closed-cycle recirculating system a separate compliance alternative, such that the rule now includes five compliance alternatives. In addition, EPA has clarified that facilities may comply with the rule requirement in section 125.94 by successfully implementing the construction, operational, maintenance, monitoring, and adaptive management requirements in a Technology Installation and Operation Plan developed in accordance with § 125.95(b)(4)(ii) and/or a Restoration Plan developed in accordance with § 125.95(b)(5). These plans must be designed and adaptively managed to meet the applicable performance standards in § 125.94(b) and (c). The following discussion describes the regulatory approach of the final rule, as developed through the proposed rule and the NODA.

EPA proposed requirements for the location, design, construction, and capacity of cooling water intakes based on the waterbody type and the volume of water withdrawn by a facility (67 FR 17122). EPA grouped waterbodies into five categories, as in the Phase I regulation—freshwater rivers and streams, lakes and reservoirs, Great Lakes, estuaries and tidal rivers, and oceans. In general, the more sensitive or biologically productive the waterbody, the more stringent were the requirements proposed. The proposed requirements also varied based on the percentage of the source waterbody withdrawn and the capacity utilization rate.

Under the proposed rule, a facility could choose one of three compliance options: (1) Demonstrate that the facility currently meets the specified performance standards, (2) select and implement design and construction technologies, operational measures, or restoration measures that will, in combination with any existing design and construction technologies, operational measures, or restoration measures, meet the specified performance standards, and/or (3) demonstrate that the facility qualifies for a site-specific determination of best technology available, because its costs of compliance are significantly greater than those considered by EPA during the development of the proposed rule or the facility's costs of compliance would be significantly greater than the benefits of compliance with the proposed performance standards at the facility. A facility could also use restoration measures in addition to or in lieu of design and construction technologies and/or operational measures to achieve compliance under any of the compliance options.

In the NODA, EPA sought comment on a proposed fourth compliance option (68 FR 13522, 1359-41). In response to comments expressing concern that the proposed Comprehensive Demonstration Study requirements (at § 125.95(b)) would impose a significant burden on permit applicants, EPA examined an additional, more streamlined compliance option under which a facility could implement certain specified technologies that have been predetermined by EPA or the permitting authority to be highly likely to meet applicable performance standards, in exchange for not having to perform most of the elements of the proposed Comprehensive Demonstration Study.

Two variations were offered in the NODA: (1) EPA would evaluate the effectiveness of specific technologies in achieving an 80 to 95 percent reduction in impingement mortality and a 60 to 90 percent reduction in entrainment and then specify applicability criteria to ensure that the technology would meet the performance standards at facilities satisfying the criteria, or (2) EPA would establish the criteria and a process for States to pre-approve intake structure control technologies as likely to meet the performance standards. For facilities located on freshwater rivers and streams and meeting specified criteria, wedgewire screens would be expected to meet the proposed performance standards. EPA also recognized that these two variations are not mutually exclusive and either or both could be adopted in the final rule.

To a large extent, EPA is adopting the regulatory framework put forth in the proposed rule and supplemented by the NODA. To the three compliance alternatives originally proposed, EPA has added an approved technology alternative discussed in the NODA and included reduction of flow commensurate with closed-cycle cooling as a distinct alternative.

2. Calculation Baseline

Also, in response to comments that the proposed definition for the calculation baseline was overly vague,

EPA published in the NODA a series of additional considerations regarding the calculation baseline and a new definition of it taking these considerations into account (68 FR 13522, 13580-81). The specifications are as follows and the new definition is in today's final rule at § 125.93.

• Baseline cooling water intake structure is located at, and the screen face is parallel to, the shoreline or another depth if this would result in higher baseline impingement mortality and entrainment than the surface. EPA believes it is appropriate to allow credit in reducing impingement mortality from screen configurations that employ angling of the screen face and currents to guide organisms away from the structure before they are impinged.

• Baseline cooling water intake structure opening is located at or near the surface of the source waterbody. EPA believes it is appropriate to allow credit in reducing impingement mortality or entrainment due to placement of the opening in the water column.

• Baseline cooling water intake structure has a traveling screen with the standard 3/8 inch mesh size commonly used to keep condensers free from debris. This allows a more consistent estimation of the organisms that are considered “entrainable” vs. “impingeable” by specifying a standard mesh size that can be related to the size of the organism that may potentially come in contact with the cooling water intake structure.

• Baseline practices, procedures, and structural configurations are those that the facility would maintain in the absence of any structural or operational controls implemented in whole or in part for the purpose of reducing impingement mortality and entrainment. This recognizes and provides credit for any structural or operational controls, including flow or velocity reductions, a facility had adopted that reduce impingement mortality or entrainment.

EPA also requested comment on allowing an “as built” approach under which facilities could choose to use the existing level of impingement mortality and entrainment as the calculation baseline if they did not wish to take credit for the previously adopted measures. This could significantly simplify the monitoring and calculations necessary to determine the baseline.

In the NODA, EPA also discussed an approach to compliance under which facilities would have an “optimization period” during which they would not be required to meet performance standards but, rather, would install, operate and maintain the selected control technologies to minimize impingement mortality and entrainment. EPA suggested several possible durations for this optimization period, and also requested comment on not specifying the duration, but instead leaving it up to the Director. 68 FR 13586 (March 19, 2003).

For the final rule, EPA adopted the NODA definition of calculation baseline with some modifications. More specifically, EPA clarified the calculation baseline to include consideration of intake depth other than at or near the surface in determining the baseline. EPA also adopted the “as built” approach for the calculation baseline, which allows facilities to use current levels of impingement mortality and entrainment as the calculation baseline if the facility is configured similarly to the criteria set up for the calculation baseline.

Finally, EPA clarified how compliance with the requirements in § 125.94 should be determined. In particular, the final rule provides that compliance during the first permit term (and subsequent permit terms if specified conditions are met) may be determined based on compliance with the construction, operational, maintenance, monitoring, and adaptive management requirements in an approved Technology Installation and Operation Plan and/ or an approved Restoration Plan, that has been developed in accordance with specified requirements to meet the applicable performance standards.

3. Measuring Compliance

EPA has clarified how compliance will be measured. At proposal, EPA received comment from the industry that there were uncertainties associated with how compliance with the proposed requirements, particularly the numeric impingement mortality and entrainment performance standards, would be determined. Under the proposed rule and NODA, determining compliance, while obviously dependent on the compliance alternative selected, would, in general, require the development of waterbody characterization data, including key criteria (species, parameters, etc.) to be measured and monitored; a determination of baseline environmental impacts; implementation of cooling water intake technologies (assuming the facility does not already meet applicable performance standards and pursues this alternative); monitoring the selected criteria; and an evaluation of compliance with the applicable numeric impingement mortality and/or entrainment permit standard. The industry stakeholders were concerned that using the performance standard to set enforceable performance requirements would require facilities to collect and analyze greater amounts of data than EPA projected to be able to account for the variability inherent in biological and efficacy data needed to support compliance determinations in spite of overall good technology performance. These stakeholders stated that setting enforceable performance standards would lead to greater administrative burdens and delays when determining numeric standards and monitoring requirements to determine compliance. They were also concerned that establishing numeric standards would stifle innovation because of fears that a technology would not perform as anticipated. These stakeholders suggested that the performance standards in the rule serve as a consistent basis for setting permit conditions and for identifying technologies; installing, operating, and maintaining the chosen technology; performing compliance monitoring; and refining or adjusting operation, maintenance, or other factors in light of initial monitoring.

Today's rule allows facilities to develop and implement a Technology Installation and Operation Plan that would, when used, serve as the primary mechanism upon which compliance with the performance standard requirements of this rule is determined. EPA has established this compliance mechanism because it will ensure that Phase II existing facilities will continually be required to achieve a level of performance that constitutes, for them, best technology available for minimizing adverse environmental impact. For facilities that choose to comply with applicable requirements in whole or in part through the use of restoration measures, the Restoration Plan would serve a similar function. The Restoration Plan is discussed in detail in section IX.

An existing facility that chooses to use a Technology Installation and Operation Plan must (1) select design and construction technologies, operational measures, and/or restoration measures that will meet the performance standards, and (2) prepare a Technology Installation and Operation Plan documenting what, how and when it will install, operate, maintain, monitor, assess, and adaptively manage the design and construction technologies and operational measures to meet the performance standards, including operational parameters and

inspection schedules, etc. Each facility using a Technology Installation Operation Plan must specify key parameters regarding monitoring (

e.g.

, parameters to be monitored, location, and frequency), optimization activities and schedules for undertaking them, ways of assessing efficacy (including adaptive management plan for revising design and construction technologies or operational measures) that ensure that such technologies and measures are effectively implemented, and revised as needed to meet performance standards. This plan must be reviewed and approved by the Director and evaluated for sufficiency and/or revised at each permit term to ensure that the facility is moving expeditiously toward attainment of the applicable performance standards. Once approved, each Phase II existing facility must implement the plan according to its terms. Compliance with the final rule's performance standards during the permit term will be assessed based on the terms of the plan. If a facility does not comply with the plan, the Director has discretion to implement the performance standards or requirements through specifying numeric impingement mortality and entrainment requirements or technology prescription (for the site-specific alternative) in the permit. In addition, a facility that is unable to meet the applicable performance standards using the Technology Installation and Operation Plan approach may request in a subsequent permit that the Director make a site-specific determination of best technology available in accordance with § 125.94(a)(5).

Under these provisions, compliance is determined in terms of whether the facility is implementing, in accordance with the Technology Installation and Operation Plan schedule, the technologies, measures and practices determined by the Director to be the best technologies available for minimizing adverse environmental impact for that facility. The Section 316(b) requirements for the facility are expressed non-numerically, which is analogous to the use of best management practices under other provisions of the CWA. See,

e.g.

, sections 402(a) and 402(p). While EPA has been able to calculate ranges for national performance standards based on model technologies, EPA has insufficient data to determine—as it routinely can do in the context of effluent limitations guidelines and standards—that use of those model technologies will consistently result in achievement of those standards.

The record persuades EPA that there is uncertainty associated with the application and long-term efficacy of these technologies at all facilities under the multitude of different site-specific factors and conditions under which these technologies might have to perform. In addition, even at a single site, there is substantial year-to-year variability in species abundance and composition, as well as other natural and anthropogenic factors, that may affect the performance of a particular technology installed at the facility and it is unclear how this would affect the efficacy of the technology. The Technology Installation and Operation Plan provisions are intended to account for this. For example, meeting numerical reduction standards may not be possible at some sites either because hydrological conditions are not conducive to technological effectiveness, or due to species sensitivity. A Technology Installation and Operation Plan allows a facility, working with the Director, to identify, install, and adaptively manage technologies suited to its particular site conditions. In addition, measuring impingement mortality and entrainment reduction is difficult and would require a substantial amount of multi-year biological data and analysis is burdensome for the facility to develop, is often well beyond the type of information EPA can expect State Directors to be able to develop when monitoring compliance. A Technology Installation and Operation Plan simplifies enforcement: if a facility fails to meet the schedules and other terms of its plan, it is violating its section 316(b) requirements; there is no need to engage in extensive debate about the meaning of complex biological data. This does not mean that biological monitoring and assessment of success in meeting applicable performance standards is not important. If fact, it is critical to the compliance approach adopted in the rule in that it informs facilities and permit authorities when adaptive management, including revisions to the Technology Installation and Operation Plan, are needed to meet the performance standards.

The Technology Installation and Operation Plan provisions also reflect that there is uncertainty about how long it would take a facility to adaptively manage the technology and determine the appropriate operating conditions for the technology to meet the applicable performance requirements. Data and comments available to EPA suggest that it is common for existing facilities to adjust technologies over time in order to achieve optimum performance and, therefore, an adaptive management approach as specified under a plan is appropriate. See documentation at DCN# 1-3019-BE, 4-1830, and 6-5001. EPA understands that adaptive management is going to be necessary for a number of facilities because there are relatively few rigorous evaluations of efficacy under different site and operating conditions. The available studies may also be limited in the numbers and types of species that they have evaluated and they may not show the long term demonstrated effectiveness (and/or consistency of effectiveness) of the technology with the added uncertainties associated with the variability of natural biological systems. By requiring facilities to employ adaptive management principles, EPA assures that the facility will be implementing, on an ongoing basis, the best array of technologies available to them.

As noted above, the Technology Installation and Operation Plan provisions also simplify implementation because they identify the specific compliance requirements needed to meet the performance standard ranges and reduce some of the burden associated with measuring and enforcing compliance with these ranges for both existing facilities and Directors. Directors and facilities may find use of a Technology Installation and Operation Plan preferable because it is less feasible to develop and accurately evaluate biological monitoring data over a relatively short period, as would be required by measuring compliance against a numeric performance standard. Rather, the plan provisions allow implementation to be adaptive, and allow for data development and assessment to proceed in a manner that is appropriate for the facility, technology, and waterbody characteristics.

EPA has the legal authority to express section 316(b) requirements in terms of design criteria, in addition to or in place of enforceable numeric performance standards. EPA employed a design criterion approach in the Phase I rule, when EPA was able to identify a single nationally available and economically practicable technology for the category of new facilities as a whole, in that case closed-cycle recirculating cooling technology. In this rule, EPA was not able to identify a uniform set of technologies that would be available and economically practicable for all existing facilities, but EPA was able to articulate a uniform nationally applicable principle in the form of the performance standards in § 125.94(b), by

which such technologies could be identified by the Director and implemented through the use of a Technology Installation and Operation Plan designed to achieve them. While the technology solution was different in Phase I and Phase II, the legal principle is the same. In addition, EPA has the legal authority to identify section 316(b) requirements as an evolving set of technologies, rather than a single technology array fixed in time. Section 316(b) requires that any technology selected under that section must be the best available to the facility. This term encompasses consideration of effectiveness, costs, non-water quality environmental impacts, feasibility issues and a host of other considerations relevant to existing facilities. See section 304(b)(2)(B). The record indicates that for some facilities, the question of what are

available

technologies and, among those, what is the

best

technology, may change over time. A Technology Installation and Operation Plan is intended to assure that at all times a facility is implementing a technology—or a technology plan—that reflects the best of all technologies consistent with uniform guiding principles in the form of performance standards available to them in light of their site-specific circumstances.

Finally, EPA notes that the way in which performance standards guide technology selection and implementation varies slightly among the five compliance options. For facilities complying with § 125.94(a)(1), the technologies identified are so effective that EPA is confident that any facility employing them will meet the performance standards, so a Technology Installation and Operation Plan and performance monitoring are not required. Because these technologies are not available to all Phase II existing facilities, however, EPA has provided alternative compliance options. For facilities complying in accordance with § 125.94(a)(2), (3), or (4), compliance is generally achieved by implementation of a Technology Installation and Operation Plan designed to meet applicable performance standards. Finally, for facilities that comply in accordance with § 125.94(a)(5) for whom even compliance in accordance with § 125.94(a)(2), (3), or (4) is not available because of significantly higher costs, compliance is achieved by implementation of a Technology Installation and Operation Plan that achieves an efficacy as close as practicable to the applicable performance standards.

4. Site-Specific Requirements

a. Costs Significantly Greater Than Costs Considered by the Administrator

In today's final rule, a facility that demonstrates to the Director that the costs of compliance with the performance standards and/or restoration requirements would be significantly greater than the costs considered by the Administrator for a similar facility, will be given a site-specific determination of best technology available for minimizing adverse environmental impact. The standards of the rule have not changed since proposal, with the exception of one clarification: in the final rule, the alternative site-specific requirements established by the Director must achieve an efficacy that is as close as practicable to the performance standards and/or restoration requirements specified in § 125.94(b) and (c). This was not specified in the proposed rule language. In addition, today's final rule also explains how a facility should calculate costs considered by the Administrator for a similar facility, for comparison with the costs of compliance for the facility. EPA details these steps in § 125.94(a)(5)(i)(A)-(F).

In the proposed rule, submittal requirements for facilities requesting a variance based upon a cost-cost test were identical to those for facilities requesting a variance based on a cost-benefit test. Thus, a facility requesting a site-specific determination based on a cost-cost comparison had to submit three studies: the Cost Evaluation Study, the Valuation of Monetized Benefits of Reducing Impingement and Entrainment, and the Site-Specific Technology Plan. In the final rule, by contrast, a facility must submit only the Cost Evaluation Study and the Site-Specific Technology Plan.

Under the Comprehensive Cost Evaluation Study detailed at proposal, a facility must submit detailed engineering cost estimates to document the costs of implementing the technologies and/or operational measures in the facility's Design and Construction Plan. In the final rule, the facility must provide, in addition to the engineering cost estimates, a demonstration that the costs significantly exceed the benefits of complying with the applicable performance standards. EPA did not make significant changes to the requirements under the Site-Specific Technology Plan.

In summary, the major changes in the cost-cost analysis are as follows:

• In the final rule, EPA has specified how a facility must “calculate costs considered by the Administrator” for comparison with the facility's estimate of the costs of compliance with the final rule,

• Elimination of the requirement to submit a Valuation of Monetized Benefits of Reducing Impingement and Entrainment, and

• Addition of the requirement to demonstrate that the costs significantly exceed the costs considered by the Administrator for a similar facility, under the Cost Evaluation Study.

b. Costs Significantly Greater Than Benefits

In today's final rule, a facility that demonstrates to the Director that the costs of compliance with the performance standards and/or restoration requirements would be significantly greater than the benefits will be given a site-specific determination of best technology available for minimizing adverse environmental impact. The standards of the rule have not changed since proposal, with the exception of one clarification: in the final rule, the alternative site-specific requirements established by the Director must achieve an efficacy that is as close as practicable to the performance standards and/or restoration requirements specified in § 125.94(b) and (c). This was not specified in the proposed rule language.

In the final rule, as in the proposal, a facility requesting a site-specific determination based on a cost-benefit comparison must submit three studies: the Cost Evaluation Study, the Benefits Valuation Study (referred to in proposal as Valuation of Monetized Benefits of Reducing Impingement and Entrainment), and the Site-Specific Technology Plan. The final rule has both added and clarified requirements for the first two components relative to the proposal, but has provided no substantive changes in the requirements for the Site-Specific Technology Plan.

Under the Comprehensive Cost Evaluation Study detailed at proposal, a facility must submit detailed engineering cost estimates to document the costs of implementing the technologies and/or operational measures in the facility's Design and Construction Plan. In the final rule, the facility must provide, in addition to the engineering cost estimates, a demonstration that the costs significantly exceed the benefits of complying with the applicable performance standards.

Additional clarifications are found in the Benefits Valuation Study. In the proposed rule, a facility was required to submit (1) a description of the

methodology used to estimate the benefits' value, (2) the basis for assumptions and quantitative estimates, and (3) an uncertainty analysis. In the final rule, EPA has retained the three submittal requirements. Under the first component, EPA has specified the categories of potential valuation estimates in the final rule, namely commercial, recreational and ecological benefits. EPA has added that a facility should include non-use benefits if applicable. To the second component, EPA has added that the basis may include a determination of entrainment survival if the Director approved such a study. Requirements for the uncertainty analysis remain unchanged from proposal. In the final rule, EPA has added that a facility will be required to submit peer review of the items submitted (upon the Director's request) and a narrative description of non-monetized benefits that would result at the site if the facility was to meet applicable performance standards.

In summary, the major changes in the co

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