Record of Decision; Proposed Healy Clean Coal Project, Denali Borough, AK

DEPARTMENT OF ENERGY

Record of Decision; Proposed Healy Clean Coal Project, Denali

Borough, AK

AGENCY: Department of Energy.

ACTION: Record of Decision; Proposed Healy Clean Coal Project, Denali

Borough, AK.

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SUMMARY: The Department of Energy (DOE) has prepared an environmental

impact statement (EIS) (DOE/EIS-0186) to assess the environmental

impacts associated with the Healy Clean Coal Project (HCCP), a proposed

demonstration project near Healy, Alaska that would be cost-shared by

DOE and the Alaska Industrial Development and Export Authority (AIDEA),

a state agency, under DOE's Clean Coal Technology (CCT) Program. After

careful consideration of these impacts, along with program goals and

objectives, DOE has decided that it will provide approximately $110

million in federal funding support (about 48% of the total cost of

about $227 million) for the construction and operation of two

integrated clean coal technologies to be demonstrated in the HCCP.

The National Park Service (NPS) raised concerns that increased

emissions from the combined operation of the HCCP and the existing

Golden Valley Electric Association, Inc., (GVEA) Unit No. 1 at Healy

would adversely affect the nearby Denali National Park and Preserve

(DNPP). In response to those concerns, DOE facilitated negotiations

between the project participants and the U.S. Department of the

Interior (DOI) (the parent department of the NPS). The negotiations

were successfully concluded and a Memorandum of Agreement was signed by

DOI, DOE, AIDEA, and GVEA on November 9, 1993. Under the Agreement, DOI

has supported the issuance of the final EIS and has withdrawn its

request for an adjudicatory hearing to reconsider the air quality

permit issued to AIDEA for the HCCP by the Alaska Department of

Environmental Conservation (ADEC).

The cornerstone of the Memorandum of Agreement is the planned

retrofit of Unit No. 1 to reduce emissions of NOx and SO2.

The Agreement calls for Unit No. 1 to be retrofitted with low-NOx

burners after the start-up of the HCCP to decrease Unit No. 1 emissions

by approximately 50%; the Agreement also requires that SO2

emissions from Unit No. 1 be reduced by 25% using duct injection of

sorbent. After retrofit of the Unit No. 1, the combined emissions of

both units are expected to be only slightly greater than the current

emissions from Unit No. 1. In addition, the Agreement requires that the

combined emissions from the site be reduced temporarily to current Unit

No. 1 levels if a visibility plume or haze attributable to the site is

observed. Furthermore, the Agreement may be renegotiated to require

further mitigation, including a permanent limitation on site emissions

at current Unit No. 1 levels, if such observed impacts persist.

The Agreement will become effective contingent upon its

incorporation into the ADEC air quality permit. DOE's decision to

provide cost-shared funding for the HCCP is likewise contingent on

incorporation of the terms of the Agreement into the permit.

FOR FURTHER INFORMATION CONTACT: For further information on the EIS,

contact Earl W. Evans, Environmental Coordinator, Office of Clean Coal

Technology, U.S. Department of Energy, Pittsburgh Energy Technology

Center, P.O. Box 10940, Pittsburgh, PA 15236. Telephone (412) 892-5709.

For further information on the DOE NEPA process, contact Carol M.

Borgstrom, Director, Office of NEPA Oversight [EH-25], Office of

Environment, Safety and Health, U.S. Department of Energy, 1000

Independence Avenue SW., Washington, DC 20585. Telephone (202) 586-4600

or (800) 472-2756.

SUPPLEMENTARY INFORMATION: DOE prepared this Record of Decision

pursuant to Council on Environmental Quality (CEQ) regulations for

implementing the procedural provisions of NEPA (40 CFR parts 1500-1508)

and DOE regulations (10 CFR part 1021). This Record of Decision is

based on the DOE Final EIS for the Proposed Healy Clean Coal Project

(DOE/EIS-0186).

An overall strategy for compliance with NEPA was developed for the

CCT Program, consistent with the CEQ NEPA regulations and DOE

regulations for compliance with NEPA, that includes consideration of

both programmatic and project-specific environmental impacts during and

after the process of selecting a project. This strategy is called

tiering (40 CFR part 1508.28), which refers to the coverage of general

matters in a broader EIS (e.g., for the CCT Program) with subsequent

narrower statements or environmental analyses incorporating by

reference the general discussions and concentrating solely on the

issues specific to the particular project under consideration.

The DOE strategy has three principal elements. The first element

involved preparation of a comprehensive Programmatic EIS for the CCT

Program (DOE/EIS-0146, November 1989) to address the potential

environmental consequences of widespread commercialization of each of

22 successfully demonstrated clean coal technologies in the year 2010.

The Programmatic EIS evaluated: (1) A no-action alternative, which

assumed that the CCT Program was not continued and that conventional

coal-fired technologies with flue gas desulfurization controls would

continue to be used for new plants or as replacements for existing

plants that are retired or refurbished and (2) a proposed action, which

assumed that CCT Program projects were selected for funding and that

successfully demonstrated technologies undergo widespread

commercialization by 2010.

The second element involved preparation of a preselection, project-

specific environmental review of the HCCP based on project-specific

environmental data and analyses that the offeror supplied to DOE as

part of the proposal.

The third element consists of preparing site-specific NEPA

documents for each selected project. For the HCCP, DOE determined that

an EIS should be prepared to address project-specific concerns. As part

of the overall NEPA strategy for the CCT Program, the HCCP EIS draws

upon the Programmatic EIS and preselection environmental reviews that

have already analyzed many alternatives and scenarios (e.g.,

alternative technologies and sites).

Project Description

The HCCP would be located on the southern edge of the Interior

Basin of Alaska, about 80 miles southwest of Fairbanks and 250 miles

north of Anchorage. The facility is proposed to be built adjacent to

the existing 25-MW Healy Unit No. 1 conventional pulverized-coal unit

owned and operated by GVEA in a rural setting along the east bank of

the Nenana River, about 2.5 miles east-southeast of Healy. Healy Unit

No. 1 has been operating as a baseload power plant since November 1967

and has an expected operating life until at least 2007. The facility

employs 29 people. The 65-acre site is located about 4 miles north of

the nearest border of DNPP and 8 miles north of the entrance to DNPP.

The HCCP site would be classified for land use as an industrial

site. The majority of the site has sustained surface alteration from

the construction and operation of the existing Healy Unit No. 1

generating plant, support buildings, coal storage areas, ash ponds,

roads, electric substation, and transmission lines.

The combustion technology to be demonstrated is the TRW Applied

Technologies Division entrained combustion system with limestone

injection to capture SO2 in the flue gas. The heart of the system

consists of twin all-metal combustors connected by short ducts to the

boiler. First-stage precombustors burn about 25% of the coal, and

exhaust gas from the precombustors is mixed with intake air to preheat

the main (or slagging-stage) combustors that burn the remaining 75% of

the coal. As the coal burns, molten slag collects on the walls of the

combustors and flows toward openings in the bottom of the main

combustors where it falls into water-filled slag tanks. The slagging

combustors decline slightly from horizontal to aid in the flow of the

molten slag. Some slag solidifies on the water-cooled surfaces and

serves to insulate and protect the metal walls from erosion and

excessive temperatures. The main combustion sections operate at a

slight air deficiency to reduce the amount of NOx produced. In the

boiler, combustion products mix with additional air to complete the

combustion reactions. The combustors are coupled with a specially

designed boiler that, in addition to its heat recovery function,

produces low NOx levels, functions as a limestone calciner, and

accomplishes first-stage SO2 removal. Therefore, flue gas from

combustion is expected to contain lower concentrations of SO2 and

NOx than flue gas from conventional combustion.

The postcombustion technology to be integrated with the advanced

combustion system is the Joy Technologies, Inc./Niro Atomizer spray

dryer absorber for a second stage of SO2 removal and particulate

removal. The flue gas would mix with an atomized spray that includes

activated lime from the limestone injection during combustion,

resulting in additional chemical reactions to remove SO2 and PM. A

baghouse provides further capture of PM and SO2 before the flue

gas exits through the stack. A portion of the lime collected by the

spray dryer and the baghouse would be recycled to the spray dryer and

used for SO2 removal, thereby increasing SO2 removal

efficiency while reducing solid waste.

The integrated process is expected to demonstrate at least 90%

SO2 removal. It is also anticipated that at least 20% of the total

available sulfur in the flue gas would be captured in the combustion

process and at least 70% in the flue gas desulfurization system. Of the

total ash generated, 60-90% would be removed from the combustors as

slag and from the boiler hoppers as bottom ash. Most of the remaining

ash would be removed in the baghouse.

The integrated process is suitable for repowering existing

facilities or for new facilities. If successfully demonstrated, it

would provide an alternative technology to conventional pulverized-coal

boilers with conventional flue gas desulfurization controls, while

lowering overall operating costs and reducing the volume of solid waste

generated by conventional technology in current use.

Project Status

Project activities to date have been limited to the application for

permits and approvals necessary to construct and operate the HCCP, and

the preparation of designs and specifications necessary to apply for

these permits and approvals, prepare the EIS, and provide assurance

that this innovative technology will meet permit requirements.

On September 3, 1992, the Alaska Public Utility Commission (APUC)

issued a Certificate of Public Convenience and Necessity, which will

allow AIDEA to provide electric service from the HCCP. The APUC also

approved a power sales agreement under which GVEA will purchase the

output of the HCCP from AIDEA. The Trustees for Alaska, a non-profit,

public interest, environmental law firm, appealed this decision, and on

November 24, 1993, the Superior Court for the State of Alaska, Third

Judicial District, affirmed the APUC's decision. The Trustees for

Alaska have appealed this ruling to the Alaska Supreme Court. On

January 27, 1994, the Superior Court granted the Trustees for Alaska's

motion to stay the Certificate pending a final ruling by the Alaska

Supreme Court. Also, on March 10, 1993, the ADEC issued a Prevention of

Significant Deterioration (PSD) air quality permit for the HCCP. AIDEA

has applied to ADEC to have the provisions of the Memorandum of

Agreement discussed in the SUMMARY incorporated into the PSD permit.

AIDEA is also in the process of obtaining other permits and approvals.

Alternatives

Congress directed DOE to pursue the goals of the CCT Program by

means of partial funding of projects owned and controlled by

nonfederal-government sponsors. This statutory requirement places DOE

in a much more limited role than if the federal government were the

owner and operator of the project. In the latter situation, DOE would

be responsible for a comprehensive review of reasonable alternatives

for siting the project. However, in dealing with an applicant, the

scope of alternatives is necessarily more restricted, because the

agency must focus on alternative ways to accomplish its purpose which

reflect both the application before it and the functions it plays in

the decisional process. It is appropriate in such cases for DOE to give

substantial weight to the applicant's needs in establishing a project's

reasonable alternatives.

Based on the foregoing principles, the reasonable alternatives to

the proposed action are the no-action alternative (including scenarios

reasonably expected as a consequence of the no-action alternative) and

an alternative site nearer the coal mine fuel source.

Proposed Action

The proposed action is the provision of approximately $110 million

in cost-shared federal funding support, which is about 48% of the $227

million total cost, for the construction and operation of two

integrated clean coal technologies to be demonstrated in the HCCP, a

new 50-MW coal-fired power generating facility at Healy, Alaska. The

two technologies to be demonstrated are the TRW entrained combustion

system and the Joy spray dryer absorber. These technologies have been

designed to achieve reduction in emissions of SO2, NOX, and

particulate matter (PM) while being energy efficient technologies

capable of being used in new facilities or retrofitted to existing

units. The technologies would be dependent on each other as part of an

integrated system.

AIDEA conceived, designed, and proposed the HCCP in response to a

Program Opportunity Notice issued by DOE in May 1989 to solicit

proposals. DOE's role is limited to providing the cost-shared funding

for AIDEA's proposed project. In addition, AIDEA and DOE have different

objectives to be attained through the HCCP: DOE's objective is to

demonstrate the technologies, while AIDEA's intent is to promote

economic development, in this case by increasing Alaska's coal-fired

electrical generating capacity.

Coal would be supplied for the HCCP by Usibelli Coal Mine, Inc.,

(UCM) from its open-pit Poker Flats Mine and other reserves, located

about 4 miles north of the proposed site. GVEA has entered into a power

sales agreement for the purchase and distribution of the electricity

that would be generated by the HCCP. AIDEA has assembled a team

composed of GVEA, UCM, Stone & Webster Engineering Corporation, Foster

Wheeler Energy Corporation, TRW, and Joy to design, build, and operate

the power plant. The project participant would obtain all applicable

permits for the HCCP and would comply with all applicable laws,

regulations, and ordinances. AIDEA initially proposed a site about 4

miles north of the currently proposed site. The participant

subsequently proposed, with DOE approval, to move the proposed HCCP 4

miles south after AIDEA limited the project to a power generation

facility because the initially proposed co-located coal-upgrading

operations were not expected to be economical because of their early

stage of development.

No Action

This alternative does not provide federal cost-shared funding for

the HCCP. The Programmatic EIS for the CCT Program (DOE/EIS-0146)

evaluated the consequences of no action on a programmatic basis. Under

the no-action alternative for the HCCP, the commercial readiness of the

proposed technologies for the combined removal of SO2, NOX,

and PM would not be demonstrated at Healy, Alaska, and probably would

not be demonstrated elsewhere because there are currently no other

similar proposals in the CCT Program. The opportunity to demonstrate

these technologies would likely be lost. As a result, commercialization

of the technologies could be delayed or might not occur because the

utility and industrial sectors tend to utilize known and demonstrated

technologies over new, unproven technologies.

Under the no-action alternative, two reasonably foreseeable

scenarios could result. Neither scenario would contribute to the

objectives of demonstrating the economic feasibility and environmental

acceptability of new coal utilization and pollution control

technologies.

First, GVEA could continue to operate the present power plant and

continue to buy natural-gas-generated power from Anchorage utilities

without building any new generating facilities. No construction

activities or changes in operations would occur. Coal requirements and

electricity generation would remain constant, and there would be no

change in current environmental impacts of plant operations.

Second, a conventional coal-fired power plant equivalent in

capacity to the proposed project could be built in the Healy area by

the project participants or other parties without DOE's financial

assistance to meet the power demand. The best available conventional

control technologies would be required. These would likely include dry

scrubbers that use lime to remove SO2 from the flue gas, low-

NOX burners, and a baghouse to remove PM. The dry scrubbers would

generate a solid waste that, along with the PM from the baghouse, would

be returned to the UCM Poker Flats Mine for disposal. The new plant

would lessen or eliminate the need to buy power from Anchorage

utilities to the same extent as the HCCP.

Alternative Site

The feasibility of siting coal-fired power plants in various

locations in the Alaska Railbelt has been studied on several occasions

by several organizations. GVEA and the City of Fairbanks, for example,

proposed to build a 130-MW coal-fired plant adjacent to Healy Unit No.

1 in 1978; and in 1985 and 1988, the Alaska Power Authority studied the

feasibility of siting coal-fired power plants in the Alaska Railbelt.

In 1987, the City of Nenana performed a preliminary feasibility study

for a coal-fired electric generation facility to be located near the

city.

These studies all showed that siting a coal-fired power plant at

any of the studied locations, including Healy, would have environmental

impacts. Although an alternative site location such as Nenana might

have been feasible for the projects referenced above, such a location

renders a proposed CCT project economically infeasible from GVEA's

standpoint because of increased capital requirements, labor costs, and

fuel costs. In addition, siting the plant near Nenana to utilize the

river water source could impact anadromous fisheries. Locating the

plant between Nenana and Fairbanks would probably not be permitted

because of nonattainment of air quality standards in the Fairbanks

area. A location away from the existing electrical intertie system

would require construction of a new powerline transmission link at a

cost of about $500,000 per mile and with associated environmental

impacts. Siting a plant near existing communities between Healy and

Fairbanks could also require developing new infrastructure.

The project participant has determined that the only alternative

sites that appear feasible for economic or environmental reasons are

those along the Nenana River close to the UCM Poker Flats mine and

adjacent to the existing power intertie. Within that area, sites closer

to the mine mouth, sites near an existing community infrastructure, and

sites that do not require additional disturbance or access routes

appear to have advantages. The project participant previously had

considered a site located at the UCM train loadout facility across the

Nenana River from the UCM mine. This site, which is the site initially

proposed by AIDEA, is typical of feasible alternative sites from the

standpoint of environmental and socioeconomic impacts and was therefore

adopted as the reasonable alternative site to be analyzed in the EIS.

Other alternatives which did not meet the goals and objectives of

the CCT Program or of the participant were dismissed from further

consideration.

Environmentally Preferred Alternative

No action would be the environmentally preferred alternative,

depending on what action AIDEA and GVEA would take as a result of a DOE

decision not to fund the project. If GVEA continued to purchase power

in lieu of building a new plant, impacts would remain at current

levels. However, if a new conventional coal-fired plant were to be

built, it would cause greater air quality impacts than the HCCP. In

addition, the reduction in emissions of Unit No. 1 resulting from the

Memorandum of Agreement would not occur. While it is reasonably

foreseeable that GVEA could pursue a conventional plant to meet its

power needs if DOE were not to fund the HCCP, that eventuality is

somewhat speculative, because it is unknown whether such a plant could

meet all regulatory requirements. However, a conventional plant would

be expected to meet the limits of the air quality permit issued by ADEC

in March 1993 for the HCCP.

Major Environmental Impacts and Mitigation Measures

Potential impacts to air quality, surface water, groundwater, and

ecological and socioeconomic resources that could result from

construction and operation of the proposed HCCP are analyzed in the

HCCP EIS.

Air Quality and Visibility

Of primary concern are the impacts to air quality and visibility

expected from HCCP operation, as predicted by analyses based on

computer models. The analysis examined the impacts of the HCCP alone,

and cumulatively with those from Unit No. 1, both without and with the

retrofit to Unit No. 1 provided for by the Memorandum of Agreement.

Emissions

The following table shows the projected emissions, in tons per

year, for the Healy site, including the reductions to be achieved by

the Memorandum of Agreement.

Unit No. 1 only Healy site w/o MOA Healy site w/ MOA

SO2................... 630 ..... Unit No. 1............ 630 ..... Unit No. 1............ 1472 .....

..... ..... HCCP.................. 124 ..... HCCP.................. 124 .....

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..... ..... ...................... ..... 754 ...................... ..... 596

NOx................... 848 ..... Unit No. 1............ 848 ..... Unit No. 1............ 429 .....

..... ..... HCCP.................. 577 ..... HCCP.................. 577 .....

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..... ..... ...................... ..... 1425 ...................... ..... 1006

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Total........... ..... 1478 ...................... ..... 2179 ...................... ..... 1602

For NOX control, the Agreement calls for Unit No. 1 to be

retrofitted with low-NOX burners after the start-up of the HCCP.

GVEA has agreed to reduce Unit No. 1 NOX emissions by

approximately 50%, from 848 tons per year to 429 tons per year. The

Agreement also requires that SO2 emissions from Unit No. 1 be

reduced by 25%, from 630 tons per year to 472 tons per year, using duct

injection of sorbent (e.g., flash-calcined material or lime). If the

HCCP demonstration technology operates as expected, combined NOX

and SO2 emissions from the Healy site would increase by only about

8%, from 1478 tons per year to 1602 tons per year, even though

electrical generation would increase from the existing 25 MW to 75 MW

for the two units. This is about 25% less than the 2179 tons per year

that would be emitted if Unit No. 1 were to continue to operate,

unretrofitted, in conjunction with the HCCP at its demonstration target

levels. GVEA is required under the Agreement to request permit

emissions limitations to reflect the levels achieved during the HCCP

demonstration, allowing for reasonable operational variability.

If the HCCP demonstration fails to meet project objectives for air

emissions, but attains levels allowed by the permit issued by ADEC in

March 1993, (the ``permitted case''), then the combined emissions from

the Healy site would be capped under the Agreement at 2160 tons per

year (i.e., 1439 and 721 tons per year of NOX and SO2,

respectively), about 46% over the emissions for the existing Healy

site. These maximum emission levels would be incorporated as permit

conditions.

Additional Mitigation

DOE believes that the Healy site can be operated at the emission

levels provided by the Memorandum of Agreement without causing

unacceptable air quality impacts (see below). However, the Agreement

requires that additional measures will be taken to further reduce

combined emissions from the site, if necessary, to protect DNPP from

visibility plume or haze impacts. Specifically, GVEA must reduce

combined site emissions to the levels of Unit No. 1 for 12 hours

whenever NPS (or ADEC) notifies GVEA of the presence of a visible plume

or haze inside DNPP attributable to the Healy site. If these conditions

occur more than 10 times in any six month period, then NPS may reopen

the Agreement and negotiate with GVEA new emission limitations or other

measures for the site, including reducing emissions to the levels of

Unit No. 1. If NPS and GVEA cannot agree, the matter will be arbitrated

in accordance with the Administrative Dispute Resolution Act (5 U.S.C.

571-583).

Air Quality

Generally accepted computer models, appropriate for establishing

compliance with Clean Air Act (CAA) regulatory requirements, were used

for analyzing potential impacts within the Healy area (a Class II air

quality area) and within DNPP (a Class I air quality area where

stringent standards have been established by the U.S. Environmental

Protection Agency). The CAA standards have been used as a gage for

assessing potential impacts associated with HCCP air emissions. For the

purpose of air quality analysis, two emission rates (levels) based on a

100% plant capacity factor were analyzed using the computer models.

These are the ``demonstration case,'' based on the very low emission

rates that are the target objectives of the HCCP demonstration, and the

``permitted case,'' based on the emission levels contained in the March

1993 ADEC permit. Both cases were modelled with and without the

retrofit controls on Unit No. 1 provided by the Memorandum of

Agreement. Maximum ambient (at or beyond the facility perimeter)

concentrations resulting from the combined operation of Healy Unit No.

1 and the HCCP are predicted to be less than the National Ambient Air

Quality Standards (NAAQS) for all cases, although the predicted short

term SO2 concentrations approached the standards. Almost all of

the modeled concentrations are predicted to occur at the site

perimeter, resulting not from the new HCCP, but from downwash (downward

movement) of the existing Unit No. 1 stack plume caused by the larger

and taller HCCP boiler building. Thus, there was no difference between

the predicted concentrations for the demonstration and permitted cases

at either level of Unit No. 1 emissions. However, the reduced emission

levels from retrofitted Unit No. 1 resulted in a small reduction in

maximum SO2 concentrations and a greater than 50% reduction in

maximum NOX concentrations for both the demonstration case and the

permitted case.

NAAQS are used to establish absolute limits for pollutant

concentrations in the ambient air, whereas Prevention of Significant

Deterioration (PSD) ``increments'' have been established to define

permissible air quality degradation. For analyzing air quality impacts

within DNPP, the stringent standards of the PSD limits for Class I

areas were used to gauge potential impacts of the HCCP at both the

demonstration and the permitted case emissions. Modeling results for

the HCCP demonstration case indicate that maximum concentrations would

be less than 50% of the PSD Class I limits in all cases. However, the

permitted case emission levels consumed 88% percent or more of the

short term increments for SO2 and particulate matter.

Visibility and Haze

The issue of the HCCP's potential to cause visibility impacts

within DNPP is of great concern to the NPS, a cooperating agency by

virtue of its role as Federal Land Manager for the DNPP. Air quality

and, when weather conditions permit, visibility within DNPP are

considered among the best anywhere. Visibility impairment, if any, is

expected to take the form of a yellowish-brown NO2 plume that

would reduce visibility or be noticeable when contrasted against

relatively clean air either above or below the plume line.

For visibility analysis, two computer models and a visibility

monitoring (photographic) program were used to analyze potential

visibility impacts within DNPP. The area of detailed study included the

far eastern edge of DNPP within the Nenana River Valley. Views from the

interior of DNPP, including views of Mt. McKinley, are not expected to

be subject to visibility impairment. The results from the computer-

based modeling predict that for the HCCP demonstration case, a visible

plume may be perceived by DNPP visitors a total of 2 hours per year (h/

year). The computer modeling also predicts that when the HCCP and Unit

No. 1 would operate simultaneously (without retrofit of Unit No. 1), a

visible plume may be perceived by visitors 15 h/year. The combined

operation of the HCCP and Unit No. 1 after the retrofits provided by

the Memorandum of Agreement predict that a plume may be perceived 9 h/

year. At the higher levels of the HCCP permitted case, a plume is

predicted 26 h/year without retrofit, and 20 h/year with retrofit of

Unit No. 1. In addition, the computer modeling predicts that during

operations of the existing Unit No. 1 alone, a visible plume should be

perceived 6 h/year. This is consistent with the fact that there have

been no published sightings of a visible plume from Unit. No. 1 from or

within DNPP by observers or operating camera equipment.

A sensitivity analysis of the effect of using modelling assumptions

preferred by the NPS indicated that a plume could be perceptible as

much as 78 h/year for the HCCP demonstration case, 262 h/year for the

simultaneous operation of the HCCP and unretrofitted Unit No. 1, and

205 h/year for the simultaneous operation of both units after the

retrofit of Unit No. 1. Results increase to 329 h/year and 294 h/year

for the HCCP permitted case, combined with Unit No. 1 unretrofitted,

and Unit No. 1 retrofitted, respectively. Use of these same assumptions

also predicts that the current operation of Unit No. 1 alone may cause

a visible plume to be perceived 145 h/year.

DOE has concluded that the modeling using the original assumptions

form reasonable estimates of the number of hours that a plume from the

HCCP and in combination with Unit No. 1 may be perceptible. The results

using the assumptions preferred by the NPS are beyond credible

estimates in view of the actual experience with Unit No. 1, that is,

there are no published sightings of a plume from Unit No. 1. The 145 h/

yr prediction for Unit No. 1 is 39% of the 372 hours of the year during

which, based on historic conditions, wind direction and speed would

allow a transport of a potentially perceptible plume to the DNPP

Visitors Center.

An analysis of regional haze reveals that adding HCCP emissions to

those from Unit No. 1 increases the estimated number of events per year

by only one event. A sensitivity analysis of the effect of using

assumptions preferred by the NPS was also done for haze modeling.

Although a larger number of events was predicted when the NPS

assumptions were used, all of the modeling indicated little increase by

adding HCCP emissions to those from Unit No. 1, regardless of the

assumptions. Observations have not attributed regional haze to the

existing Unit No. 1.

DOE is fully aware of the uncertainties inherent in the computer

modelling of visibility and haze impacts. However, the implications of

these uncertainties for predicting the impacts of the HCCP have been

significantly mitigated by the terms of the Memorandum of Agreement

discussed above. If a plume, or haze is sighted, emissions will be

reduced to existing Unit No. 1 levels.

Water Quality

The EIS also evaluates impacts of construction and operation of the

HCCP on surface water, including the Nenana River. Primary impacts to

the Nenana River would be caused by the rejection of waste heat to the

river from the discharge of a once-through cooling system. During the

production of electricity, power plants need to reject waste heat.

During preliminary engineering design, the participant evaluated three

different systems for waste heat rejection: (1) Wet cooling tower, (2)

dry (air) cooling tower, and (3) a once-through system that would use

water directly from the Nenana River. The existing Unit No. 1 uses

once-through cooling. A wet cooling tower was found to be not feasible

because the subarctic climate of central Alaska would present

operational problems and a wet cooling tower could adversely affect

local weather conditions. A dry cooling tower was found to be very

expensive because it would be much larger than a wet tower and dry

towers consume large amounts of power to drive circulation fans. The

large power requirement of a dry cooling tower would lower the overall

plant efficiency. The option of a once-through system was selected

because with the discharge of cooling water from Healy Unit No. 1 and

the HCCP into the Nenana River, cumulative water temperatures during

winter months would be below the Alaska Department of Environmental

Conservation (ADEC) limit of 55.4 deg. F at 30 ft downstream of the

HCCP discharge and beyond. During summer months, cumulative water

temperatures would be below the limit beyond 50 ft downstream of the

HCCP discharge. The state has been asked by the project participant to

allow a thermal mixing zone of 600 ft for the HCCP to meet the state

limit. The Nenana River, at the proposed site, does not support a large

population of sport fish; the fish found at the proposed site are

primarily round whitefish and longnose suckers. However, during the

winter, cold shock could kill fish acclimated to the warmer

temperatures of the once-through cooling system discharge that become

deprived of the warmed water if the HCCP would suddenly shut down. A

cross connection would be installed between the Healy Unit No. 1 and

HCCP discharges to provide the flexibility of discharging Unit No. 1

water downstream of the intake basin during summer, and to keep the

water intakes free of ice during winter if Unit No. 1 is shut down. The

cross connection may mitigate cold shock mortality by allowing

discharge to both outfalls when Unit No. 1 is shut down during winter

months.

During the winter, the waste heat rejected by Unit No. 1's once-

through cooling system presently prevents the Nenana River from

completely freezing over for an approximate distance of 4 miles

downstream (to the north). It is estimated that during operation of

both the proposed HCCP and Unit No. 1, the combined thermal discharge

would extend the area to about 10 miles downstream. Residents of the

village of Ferry, which is located about 13 miles downstream of the

proposed site, use the frozen river as an ice bridge to transport

supplies and materials across the Nenana River during the winter.

Although remnants of the thermal plume reaching Ferry could cause a

delay in the river's freezing at the beginning of winter and an earlier

breakup of the ice sheet in the spring, it is expected that the river

would continue to freeze at Ferry.

The EIS analyzes short-term and long-term socioeconomic impacts

associated with construction and operation of the proposed HCCP,

particularly in the areas of housing, education, traffic, police and

fire protection, and medical services. During HCCP construction, a peak

of approximately 300 workers is estimated. To help reduce the

``boomtown'' effect on the Healy area, it is proposed that a temporary

construction camp would be built at a location about 0.5 miles from the

proposed site to house most workers. Longer-term socioeconomic impacts

would result from 32 new workers expected for HCCP operations and from

8 new jobs created at the UCM mine. It is estimated that these new

workers and their families would increase the population of the Healy

area by approximately 102 people by 1996-1997.

No Action Alternative

The no-action alternative would result if DOE does not provide

cost-shared funding support for the HCCP; two reasonably foreseeable

scenarios could result (see Alternatives above). For the no-change

scenario, impacts would remain unchanged from the baseline conditions.

For the conventional coal-fired plant scenario, the level of impacts

would be almost identical to that of the HCCP for most resource areas

because the resource requirements and discharges are nearly identical,

except for air emissions. Surface water, groundwater, and ecological

and socioeconomic impacts are not expected to change from those in the

HCCP. The amount of coal required for the conventional plant would be

about 90% of the coal required for the HCCP. However, total mining

operations (including coal mined for other users) would increase at the

UCM mine by about 10% for the conventional plant compared with the HCCP

because about 50% of the coal used by the HCCP would be waste coal

uncovered during mining for run-of-mine coal. Particulate emissions

from fugitive dust during mining would be about 10% greater for the

conventional plant. Operational air emissions are expected to be up to

100% greater for the conventional plant (compared with HCCP

demonstration case) because the conventional plant would only be

required to meet emissions standards existing at the time of

construction, while the HCCP is expected to generate emissions

substantially less than the standards. The conventional plant would be

expected to generate about 50% less ash following combustion. Fewer

trips, involving less ash, would be required to return the ash to the

UCM mine, although the mine can easily accommodate the greater amount

of ash disposal from the HCCP.

Alternative Site

In addition to the proposed site, the EIS considers the alternative

site for the HCCP located about 4 miles north-northwest of the proposed

site. The EIS analysis indicates that, except for air quality, other

environmental and socioeconomic impacts would be greater if the HCCP

were to be constructed and operated at the alternative site. The

alternative site has been disturbed, in part, during the construction

of the loadout facility and conveyor system that transfers coal across

the Nenana River from the mine. However, the alternative site is

somewhat isolated and much less of an ``industrial site'' than the area

adjacent to the existing Unit No. 1. For example, construction of the

HCCP at the alternative site would require the site clearing of 37

acres of which 22 acres are identified as wetlands in the National

Wetlands Inventory. Only about 10 acres need to be prepared at the

proposed site adjacent to Unit No. 1 and no loss of wetlands would

occur. Also, during the winter the rejection of waste heat from the

HCCP into the Nenana River at the alternative site may extend the area

of ice-free water approximately 1 mile closer to the village of Ferry

(2 vs 3 miles). However, cumulative thermal effects resulting from the

discharge of the HCCP and Unit No. 1 cooling water into the Nenana

River would not occur at the alternative site. The expected maximum

elevation in river water temperature would be less than that expected

at the proposed site because the ambient river temperature would not be

elevated by Unit No. 1 thermal discharge. However, cumulative impacts

at the proposed site would be mitigated by the installation of a cross

connection to direct the discharge to either or both outfalls. If the

HCCP were built at the alternative site about 13 additional workers

would be required for plant operations over the 32 workers required at

the proposed site because it would no longer be possible to integrate

the operations of both Unit No. 1 and the HCCP. These additional

operational workers would be needed for control room operations and

maintenance.

Air quality analysis using computer models was performed to analyze

the potential impact from air emissions if the HCCP was constructed and

operated at the alternative site. The predicted maximum concentrations

for the demonstration case are less than the PSD Class I limits.

Because the alternative site is located about 6 miles east of the

nearest border of DNPP (and about 8 miles north of the DNPP border that

is downwind of frequent winds), while the proposed site is about 4

miles north of DNPP, air dispersion modeling has indicated that maximum

concentrations of air pollutants within DNPP would be reduced for the

alternative site as compared with the proposed site.

Impacts outside of DNPP would also decrease, except for PM which

would increase or remain about the same. Cumulative concentrations from

the simultaneous operation of the HCCP at the alternative site and the

existing Unit No. 1 would be reduced from those predicted for the HCCP

at the proposed site because the new HCCP boiler building would not

affect the Unit No. 1 stack plume. Visibility impacts to DNPP from

operation of the HCCP at the alternative site are expected to be

similar to the proposed site.

Comments Received

DOE received two letters of comment on the FEIS. Mr. Dave Lacey of

College, Alaska commented that heavy metals and carbon dioxide were

inadequately analyzed. Mr. Lacey also objected to the economic and

Federal budget implications of a government cost-shared project. He

requested a public hearing to explore these issues. Mr. Lacey's letter

raised similar issues to those provided in his oral and written

comments on the draft EIS. DOE believes that they were adequately

addressed in the FEIS, and that an additional hearing is not necessary.

The Trustees for Alaska urged DOE to delay issuance of this Record

of Decision until after the Alaska Supreme Court rules on the Trustees

for Alaska's appeal of the Superior Court decision upholding the APUC's

issuance of a Certificate of Convenience and Necessity to AIDEA for the

HCCP. The Trustees for Alaska claimed that the order of the Superior

Court to stay the Certificate pending a final ruling by the Supreme

Court undermines DOE's ability to depend on the APUC action to

establish the need for the project.

This argument misconstrues the role of DOE in the HCCP and the

purpose and need which DOE is attempting to fulfill by cost sharing the

project. The Federal need established by the CCT legislation and the

Alaska state need reflected in the APUC process are not the same, and

DOE does not depend on the APUC determination of need for power to

conclude that the project is needed to meet DOE's goals and objectives.

The goal of the CCT Program as established by Congress is to make

available to the U.S. energy marketplace advanced and environmentally

responsive technologies that will help alleviate pollution problems

from coal utilization. DOE's purpose and need for cost sharing the HCCP

is to generate data to help achieve that goal. AIDEA and GVEA's need to

meet their goals of encouraging economic development and meeting power

demand, respectively, are independent of DOE's need to meet CCT program

goals. As discussed above, AIDEA and GVEA's needs are important in

defining the alternatives available to DOE in meeting its goal, but

they are not necessary for DOE to establish that the need to meet its

goal exists.

Decision

DOE will implement the proposed action of providing approximately

$110 million in cost-shared federal funding support for the

construction and operation of two integrated clean coal technologies to

be demonstrated in the HCCP. The HCCP is intended to demonstrate the

combined removal of SO2, NOx, both of which can contribute to

acid rain, and particulate matter using advanced combustion and flue

gas cleanup technologies. In doing so, the project would successfully

demonstrate two promising technologies ready to be commercialized in

the 1990s. The project is expected to generate sufficient data from

design, construction, and operation to allow private industry to assess

the potential for commercial application of these technologies to new

or existing units. While it is possible that selecting no action would

be environmentally preferable to the proposed action, it would not

produce the data needed to further the Congressionally mandated goals

and objectives of demonstrating clean coal technologies.

This decision to provide cost-shared funding for the proposed HCCP

was made after careful review of the potential environmental impacts,

especially any potential adverse impacts on DNPP, as analyzed in the

EIS; consultation with DOI (including NPS, the Federal Land Manager for

DNPP); and taking into consideration the Memorandum of Agreement for

providing mitigation of potential impacts on DNPP from the operation of

the proposed HCCP. The decision to provide cost-shared funding for the

HCCP is being made contingent on the incorporation of the terms of the

Memorandum of Agreement into the ADEC air quality permit, as provided

in the Agreement.

Mitigation Action Plan

Section 1021.331(a) of the DOE regulations implementing NEPA (10

CFR part 1021) states that DOE shall prepare a Mitigation Action Plan

that addresses mitigation commitments expressed in the ROD. A

Mitigation Action Plan for the HCCP is being developed to ensure that

DOE implements all mitigation commitments. Copies of the Mitigation

Action Plan may be obtained from Earl W. Evans, Environmental

Coordinator, Office of Clean Coal Technology, U.S. Department of

Energy, Pittsburgh Energy Technology Center, P.O. Box 10940,

Pittsburgh, PA 15236. Telephone (412) 892-5709.

Issued in Washington, DC, on March 10, 1994.

Marvin I. Singer,

Acting Assistant Secretary for Fossil Energy.

[FR Doc. 94-6563 Filed 3-18-94; 8:45 am]

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