COALTEC—. ,—.

ENERGY USA, INC.

5749 Coal Drive Carterville, IL 62918812-455-4568 Fax 61 8.985 8766 JUN 2 72016

June 25, 2016

Independent Regulatory Review Commission333 Market Street, 14th FloorHarrisburg, PA 17101

RE: IRRC #3061PUC Docket #L-20 14-2404361

IRRC Commissioners:

Coaltec Energy is about to begin installing large-scale waste-to-energyprojects in Pennsylvania. We are concerned about the proposed rulemakingand its impact on manure, food waste and municipal biosolids projects. Werequest that you consider the following comments.

The proposed 75.13 (a) (1) appears to require customer-generators to havean existing electric load. This is a new provision, and while it may beintended to limit availability of net metering to any new alternative energysystem that has no load, it will have unintended consequences onagriculture’s attempt to reduce nutrient runoff and co-generate electricity ina cost effective manner. Currently operating dairies already have an electricload, and this section would not immediately affect them. However,this would exclude a third party entity such as Coaltec Energy fromgathering poultry litter from several farms for a regional manure-to-energysystem. For example, a new community type facility which would receivemanure or poultry litter from multiple smaller farms for economy of scalewould be excluded from net-metering benefits. We request that proposed75.13 (a) (1) be removed.

The proposed rule restricts other alternative energy sources, such as animaland food waste gasification. Well-proven on a large-scale, animal wastegasification is NRCS Conservation Practice Code 735 (see attached). Themanure-to-energy technology has an excellent potential for processinglivestock manure and other biomass waste. Gasification is a high-

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• temperature, oxygen-starved thermal process that releases energy frommanure, litter or other biomass. The only two outputs from this process areactivated carbon and enormous waste heat, which can be used to co-generate

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electricity on-site. Gasification can have an enormous benefit for•—:the Chesapeake Bay, and is included in the Commonwealth’s Watershed

Implementation Plan. The proposed rule is excessively restrictiveof alternative energy sources including proven best management practicessuch as gasification. We suggest modifying the definition of (vii) Biomassenergy to include: (D) Waste-to-Energy systems, including, but notlimited to, biological and thermal waste processing and treatmentsystems which generate electricity utilizing by-products from farms andincluding dairy manure, hog manure, poultry litter, food waste, spentmushroom substrate, and municipal biosolids.

We are also concerned about the proposed definition of Utility, since it nowincludes any entity or person who generates electricity. In its currentwording, this definition could be used to exclude customer-generators andthereby disqualify them from the benefits of net-metering. We suggest thefollowing wording to be added: THIS TERM EXCLUDES....CUSTOMER-GENERATORS GENERATING LESS THAN 5 MW. Anameplate capacity of 5 MW is consistent with the Commonwealth’s currentnet metering regulation for micro-grids.

We believe that the PUC’s proposals will limit agriculture’s and the foodindustry’s ability to self-fund and sustain innovative manure managementsystems which utilize animal waste-to-energy. This potentially has anegative impact on current and future investments by farm familiesthroughout the Commonwealth to meet their environmental obligations.We appreciate the opportunity to comment and hope that again,the IRRC will disapprove the PUC’s proposed fmal form rule.

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Peter ThomasCoaltec Energy USA, Inc.

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PA735 - 1

INTERIM CONSERVATION PRACTICE STANDARD

WASTE GASIFICATION FACILITY(No.)

CODE 735

DEFINITION

Thermo-chemical treatment facility for animaland agricultural waste in an oxygen starvedenvironment.

PURPOSE

Gasification of animal manure and otheragricultural by-products is to address one ormore of the following:

• To improve ground and surface waterquality by reducing or concentrating thenutrient content, reducing organic strength,and/or reducing pathogen levels ofagricultural operations

• To improve air quality by reducing odorsand gaseous emissions

• To produce syngas for energy productionand other value added by-products

• To facilitate desirable waste handling,storage, efficient transfer or landapplication alternatives for nutrients

CONDITIONS WHERE PRACTICE APPLIES

This practice applies where:

• The facility and associated componentsare part of an agricultural wastemanagement system.

• Raw agricultural waste contains excessnutrients for land application based oncrop utilization requirements or nutrientratios need to be modified to be moreconsistent with crop utilizationrequirements. There is a need to reducethe potential for leaching or runoff ofnutrients.

• Reduction of pathogens is desired.

• Odors and/or gaseous emissions fromlivestock production facilities and wastestorage/treatment system componentsmust be reduced.

• Syngas and/or process heat can becaptured and used to dry manure or otheragricultural products and/or generateelectricity.

• Value-added byproducts can be producedto offset treatment costs.

CRITERIA

General Criteria Applicable to AllGasification Treatment Systems.

Laws and Regulations. Agricultural wastegasification facilities must be planned,designed, and constructed to meet allFederal/State/Tribal/Local laws andregulations.

Feasibility Study. The system provider shallconduct a feasibility study to determinewhether the proposed project is feasible andmeets the landowner’s objectives. Identify thecomponents of the proposed system andprovide the costs, in time, money, or otherresources, of the installation, start-up, andoperation of the facility. Include information onfeedstock availability, marketing the productsand by-products, and the anticipated return onthe investment. Identify any parts of thesystem that would require a commitment froman outside entity if their actions would impactfeasibility. Include a clear identification of theresource concerns to be addressed and theanticipated effects on the environment.

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Design. The system provider will completeand supply to the landowner/operator adetailed design of the gasification system. Ifneeded for proper operation, include designsfor pre-processing and post-processingfacilities such as solid/liquid separation andpelletizers.

As a minimum, include a process diagram inthe design documentation along with thefollowing information:

1. The volume and characteristics of thefeedstock and of the anticipated products andby-products.

2. Projections of pre-processing and post-processing requirements, including storage,handling, transfer and utilization.

3. Expected air emissions from the system.

4. Nutrient fate projections within the system.

5. Expected pathogen reductions.

6. Process monitoring and control systemrequirements as described below in themonitoring section.

Feedstock Pre-processing. For thegasification system to function efficiently, preprocessing of the manure such as solid/liquidseparation, drying and/or particle sizemanipulation may be required. Consult theConservation Practice Standards, Solid/LiquidSeparation Facility, Code 632, or WasteTreatment, Code 629 for pre-processingguidance.

Components. The gasification systemprovider will furnish a minimum one yearwarranty on all construction or appliedprocesses. In addition, the manufacturer willprovide a warranty with documentation thatdescribes the service life of each componentand what the warranty covers.

The minimum practice life for a gasificationsystem is ten years. Clearly identify in theOperation and Maintenance Plan the expectedreplacement of any components which haveless than a 10 year service life.

Monitoring. Install the necessary equipmentto properly monitor and control the wastestream as part of the gasification system.

Monitor the process control parametersidentified in the design documentation.

If the gasification unit is located in a confinedfacility, environmental monitoring must bemaintained to ensure proper air quality forworking conditions.

Monitor the run status of critical equipment andunit processes.

The landowner/operator must have the interestand skills to monitor and maintain processes orcontracts with a consultant to provide theseservices.

Gasification By-Products. Properly disposeof or beneficially use all gasification byproducts in a safe and environmentallysensitive manner.

Handle and store all by-products in such amanner as to prevent nuisances to neighborsor to the public at large.

Use NRCS Conservation Practice Standard,Nutrient Management, Code 590, when byproducts are land applied to supply plantnutrients.

Some of the potential gasification by-productsinclude:

• Syngas. If the syngas is not self-consumed through the gasificationprocess, it can be used for electricitygeneration, heating, cooling and/orpipeline quality gas. Additional processingof the syngas may be necessary for it to beproperly utilized.

• Ash. Through complete gasification, mostnitrogen and carbon is converted to a gasphase, while many of the other nutrients(i.e. phosphorus and potassium) remain ina concentrated form in the ash. Use of thismaterial can reduce transportation costsfor land application and improve nutrientplacement.

• Biochar. Depending on the operatingtemperature, pressure and otherparameters, the resulting ash may qualifyas biochar, which is a carbon rich product.Biochar can be used as a soil amendment,carbon source or filtration medium for soilwater. Evaluate the biochar produced toensure it meets the desired use.

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PA 735 - 3

• Heat. One by-product of gasification isheat which can be used for drying, heating,cooling, and/or electricity generation.

• Liquid Fuels. Through further processingof the syngas, various types of liquid fuelscan also be produced.

Structural Design. Design roofs andenclosures in accordance with therequirements of NRCS Conservation PracticeStandards, Roofs and Covers, Code 367, andWaste Storage Facility, Code 313.

Facility Closure. Prepare a plan thatdescribes the procedures required to close thefacility.

Outside Fuel Source. Identify needed startup or supplemental energy sources andprovide appropriate storage and handlingplans.

Safety. Include adequate safety features inthe design of the gasification system tominimize hazards. Provide guards and shieldsfor moving parts of the equipment used in thegasification process.

A considerable amount of heat is generated bygasification. Use of proper protectiveequipment such as gloves and insulatedclothes is required.

Ensure that the gasifier and associatedappurtenances are gas tight to avoid gasescape and air intake which could lead to therelease of toxic gases and/or accumulation offlammable gases.

If the gasification system will create a safetyhazard, fence the area and post warning signsto prevent usage for purposes other thanintended.

As a minimum, post “Warning-Flammable Gas”and “No Smoking” signs. Provide appropriatefire protection equipment and syngas leakdetection sensors, especially in confinedareas.

Design the ventilation controls to maintain anenvironment that will prevent the release ofsmoke, gas or potential blow out from thesystem.

Carry out all treatment processes inaccordance with all safety regulations.

If required, mark the location of undergroundgas lines with signs to prevent accidentaldisturbance or rupture. Properly label exposedpipe to indicate whether gas line or other.

Additional Criteria for Gasifiers that Do NotSelf-Consume Synqas.

Syngas is flammable, highly toxic andpotentially explosive. The design of agasification system, including gas collection,control, storage and utilization processes, mustaddress the hazards associated with normaloperation and maintenance. Provide adequatesafety measures and be in accordance withstandard engineering practice for handling aflammable gas and to prevent undue safetyhazards. As a minimum:

• Locate flares an appropriate distance fromsyngas sources and storage. Placeenclosed flares as recommended by themanufacturer. The minimum distance ofopen flares from the syngas source orstorage area is 95 feet. Maintain aminimum flare height of 10 feet. Ensurethat flares are grounded or otherwiseprotected to minimize the chance oflightning strikes.

• Equip the flare with automatic ignition andpowered by battery/solar or directconnection to electrical service. Ensurethat the flare has a capacity equal to orgreater than the anticipated maximumsyngas production. Install a windshield toprotect an open flare against wind.

• Install a flame trap device in the syngasline between the gasifier and sources ofignition or as recommended by the flamearrester manufacturer.

Gas Collection, Transfer, and ControlSystem. Design the syngas collection,transfer, and control system to conveycaptured gas from the gasification unit to gasutilization equipment/devices (flare, boiler,engine, etc.) or storage.

1. Gas collection and transfer — Meet thefollowing for pipe and/or appurtenances:

• Securely anchor pipe and componentsto prevent displacement from normalforces and loads.

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• Pipe used for transfer of gas mustinclude provisions for drainage ofcondensate, pressure and vacuum relief,and flame traps.

• For steel pipe meet the requirements ofAWWA Specification C-200 or ASTMA53/A21 1 for stainless steel.

• For plastic pipe meet the requirementsof AWWA Specification C-906 or ASTMD-3350 for HDPE.

• Install pipes to enable all sections to besafely isolated and cleaned as part ofroutine maintenance.

2. Gas Control

• Locate and shelter equipment andcomponents from the elements alongwith making them readily accessible forreplacement or repair.

• Ensure that the size of equipment andconnecting pipe has a capacityconsistent with its intended use.

• Where electrical service is required atthe control facility, meet the NationalElectrical Code, state and localrequirements for all electrical wire,fixtures, and equipment.

3. Syngas Storage

If syngas is to be stored for future use orpost-processing, provide adequate volumeto meet the requirements for its final use.

Incorporate necessary safety precautions toprevent excess pressure in the gas storagearea.

Follow the guidelines outlined for the use offlares and flame traps for syngas storageunits.

Gas Utilization. Design and install gasutilization equipment in accordance withstandard engineering practice and themanufacturer’s recommendations. Include aflare to burn off excess gas.

Design gas-fired boilers, fuel cells,turbines, and internal combustion engines,when a component of the system, forburning syngas directly or burning as a mixwith other fuel. Some equipment may

require the removal of H25 and othercontaminants from the syngas before it willoperate properly.

Install and maintain a gas meter, suitablefor measuring syngas.

CONSIDERATIONS

Location. Consider locating the gasificationfacility as near the source of manure or otherwaste as practicable and as far fromneighboring dwellings or public areas aspossible. Proper location should also considerslope, distance of manure and other wastetransmission, vehicle access, wind direction,proximity of streams and flood plains, andvisibility.

Visual Screening. Evaluate the visual impactof the gasification facility within the overalllandscape context. Screening with vegetativeplantings, landforms, or other measures maybe implemented to alleviate a negative impactor enhance the view.

PLANS AND SPECIFICATIONS

Plans shall include all engineering drawingsand supporting documentation as well as otherplans required to manage the system such asa nutrient management plan for proper landapplication of by-products.

Prepare plans and specifications forgasification facilities in accordance with thecriteria of this standard and good engineeringpractice.

As a minimum, provide the following in theplans and specifications:

1. Environmental Evaluation

2. Layout and installation details of livestockfacilities, waste collection points, wastetransfer components, storage facilities andgasification system.

3. Documentation that all necessary outsidecommitments have been confirmed.

4. Location of all inflow and discharge pipes,construction materials, and necessaryappurtenances.

5. Details of support systems for allcomponents of the gasification facility.

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6. Fencing and signage as appropriate forsafety purposes.

OPERATION AND MAINTENANCE

Develop an operation and maintenance (O&M)plan and review it with the owner/operator priorto construction of a gasification facility. Identifyparameters considered critical to propersystem function in the Operation andMaintenance Plan. Ensure that the O&M planis consistent with the proper operation of allsystem components and containsrequirements including but not limited to:

• Recommended loading rates andcapacities of the gasification system.

• Proper operating procedures for thegasification system.

• Operation and maintenance manuals forpumps, blowers, instrumentation andcontrol devices, and other equipment usedas components of the gasification system.

• Description of the planned startupprocedures, normal operation, safetyissues, and normal maintenance items.This includes procedures for the plannedreplacement of components with less thana ten year service life.

• Alternative operation procedures in theevent of equipment malfunction.

• Shut-down procedures for bothmaintenance and for permanent closure.

• Troubleshooting guide.

Monitoring and reporting plan designed todemonstrate system performance on anongoing basis.

REFERENCES

Biochar for Environmental Management.Lehmann and Joseph. Earthscan. 2009.

Biomethane from Dairy Waste. A Sourcebookfor the Production and Use of RenewableNatural Gas in California. Western UnitedDairymen. 2005.http://www.suscon.org/news/biomethane reportiFuII Report.pdf

Guide For Siting Small-Scale Biomass Projectsin New York State. New York State EnergyResearch and Development Authority. 2009.http:llwww. nyserda.orq/publications/Reporto9-07

Guideline for Safe and Eco-friendly BiomassGasification — Gasification Guide. IntelligentEnergy Europe — European Commission.2009.http://qasificationcuide.euIgsq uploads/documenten/DI 0 FinalGuideline. pdf

Technical Guide Section IV Pennsylvania September 2012