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__ Arstfinetix 341 White Pond Drive Akron, Ohio 44320

Raymond L. Evans, P.E. Vice President. Environments/ snd Technologies

Mr. William F: Durham Director, Division of Air Quality

November 6, 2015

West Virginia Department of Environmental Protection 601 5Jth Street, SE Charleston, West Virginia 25304

Dear Mr. Durham:

Re: Data Request to Coal-Fired Electric Generating Units in West Virginia

330-315-7342 Fsx: 330-777-6514

FirstEnergy Corp. (FE) on behalf of Monongahela Power Company (MP), Potomac Edison (PE), and Allegheny Energy Service Corporation (AESC) provides the following response regarding the various factors set forth in West Virginia House Bi112004 that are to be considered by the West Virginia Department of Environmental Protection (WV DEP) in developing a state implementation plan required by the United States Environmental Protection Agency's (EPA) Clean Power Plan. House Bill 2004 requires "a flexible state plan to achieve targeted reductions in greenhouse gas emissions, the department shall endeavor to establish an achievable standard of performance for any existing fossil fuel-fired electric generating unit, and examine whether less stringent performance standards or longer compliance schedules may be implemented or adopted for existing fossil fuel-fired electric generating units in comparison to the performance standards established for new, modified or reconstructed generating units, based on the following:"

(1) Consumer impacts, including any disproportionate impacts of energy price increases on lower income populations; • Analysis conducted by the Electric Reliability Council ofTexas1 demonstrate

wholesale power supply prices will increase as a result of EPA's Clean Power Plan. Unfortunately, any specific studies regarding West Virginia are not available yet.

• State or regional compliance strategies in West Virginia and other P JM states will highly influence the level of energy price increases and impacts on lower income populations.

(2) Non-air quality health and environmental impacts; • In general, higher energy prices have been found to have a negative health impact on

lower income populations. 2

1 Electric Reliability Council of Texas, Inc., "ERCOT Analysis of the Impacts of the Clean Power Plan- Final Rule Update," October 2015 2 Children's Health Watch, "The Impacts of Increasing Household Energy Prices on Health and Health Care Cost in New York State," May 2013.

Mr. William. F. Durham Page2 November 6, 2015

(3) Projected energy requirements; • MP and PE future integrated resource plans will be impacted by EPA's Clean ·Power

Plan, however, impacts cannot be determine4 mtil state or regional compliance strategies have been established.

( 4) Market-based considerations in achieving performance standards; • In general, market-based approaches are the most cost effective if properly constructed.

(5) The ~sts of achieving emission reductions due to factors such as plant age, location or basic process design; • Because there is no commercially demonstrated greenhouse gas pollution controls for

power plants, emission reductions can only be achieved by improving efficiency which is commonly referred to as heat rate.

• · For each power plant, heat rate depends on the plant's design, its operating conditions, and its level of electric power output

• Power plants suffer age-related degradation over time. • EPA-mandated emissions control retrofits have also had an adverse effect on heat mte

at power plants. • Many power plants have shifted from steady base load operation to flexible opemtion,

requiring load following and significant time at partial load, again adversely impacting plant efficiency and heat rate.

(6) .Physical difficulties with or any apparent inability to feasibly implement certain emission reduction measures; • FE's analysis concludes a total heat rate improvement up to 1.5% from current

opemting parameters is the maximum attainable at an economically justifiable cost. • EPA's Clean Power Plan cites a Sargent and Lundy case study found a 4% heat rate

improvement, but over half of the heat rate improvements or 2.3% were due to an entire turbine steam path replacement which many plants have already performed.

• A second Sargent and Llindy case study found a 1.2% heat rate improvement and included a number of improvements that power plants have already performed in the normal course of business. ·

• Heat mte improvements will be significantly offset by future additions of pollution control devices that utilize station power and further diminished by reduced coal plant capacity factors associated with EPA's Building Block #2 that shifts dispatch from coal-fired units to NGCC units.

• Heat rate improvements will impact WV customers through higher electric prices.

(7) The absolute cost of applying the performance standard to the unit; • The absolute cost of compliance will be highly influenced by the state implem~ntation

plans of WV and other P JM states.

(

Mr. William F .. Durham Page3 November 6, 2015

(8) The expected remaining useful life of the unit; • On average, FE coal-fired power plants have historically been deactivated within a

70-year lifetime

(9) The impacts of closing the unit, including economic consequences such as expected job losses at the unit and throughout the state in fossil fuel production areas including areas of coal production and natural gas production and the associated losses to the eaJnomy of those areas and tb.e state, if the unit is unable to comply with the performance standard; • FE subsidiaries operate three coal-fired power plants in the state of West Virginia: Fort

Martin, Hanison, and Pleasants. • Fort Martin Station has two eoal-fired units that produce 1,098 megawatts (MW) of

electricity, employs approximately 180 people, consumes more than 2.8 million tons of coal annually and pays approximately $3.4 million annlially in property taxes.

• Harrison has three coal-fired units that produce 1,984 MW of electricity, employs approximately 230 people, consumes more than 5 million tons of coal annually and pays approximately $5 million annually in property taxes.

• Pleasants has two coal-fired units that produce 1,300 MW of electricity, employs approximately 190 people, consumes more than 3.4 million tons of coal annually and pays approximately $5 million annually in property taxes.

• In total, our WV coal-fired power plants directly employ 600 people, use more than 11.2 million tons of coal annually, and pay approximately $13.4 million annually in property taxes.

(10) Impacts on the reliability of the system; and • Coal-fired power plants provide reliable 2417 electric generation to the grid • Coal is abundant, relatively affordable, can be stored on-site and is not interruptible like

natural gas and renewables. • Gas-fired power plants provide a relatively stable source of electric· generation to the

grid, however, the recent Polar Vortex demonstrated that a stable gas supply is not guaranteed due to limited pipeline transmission.

• Electric grid reliability will be disrupted when transportation of gas to power plants must be interrupted due to high demand for gas for heating purposes.

(11) Any other factors specific to the unit that make application of a modified or less stringent standard or a longer compliance schedule more reasonable. • Emission rates of 1,305 lb CCh/MWhr for steam generating units and 771 lb

C021MWbr for stationary combustion turbine/NGCC units is not technologically achievable

• EPA essentially recognized the infeasibility of those limits by establishing less stringent emission rates for brand new steam generating units and NGCC under Clean Air Act Section 111(b) that represents what is feasible and proven with today's technology.

Mr. William F. Durham Page4 November 6, 2015

• West Virginia should seek an extension to submit a final state plan in September 2018 to allow for time to fully evaluate all options.

FE appreciates your consideration of our views.

By UPS Next Day Air cc: TLClarke, WV DEP

Sincerely,